Successful Signature Closing Coupled with Combined Industry Leading Growth and Performance Metrics
JERICHO, N.Y., Oct. 27, 2026 /PRNewswire/ -- Esquire Financial Holdings, Inc. (NASDAQ: ESQ) (the "Company"), the financial holding company for Esquire Bank, National Association ("Esquire Bank" or the "Bank"), (collectively "Esquire") today announced its operating results for the third quarter and year-to-date of 2026.
Effective August 1, 2026, Esquire completed its previously announced acquisition of Signature Bancorporation, Inc., the parent company of Signature Bank of Chicago (collectively "Signature"). The following summarizes key highlights on August 1, 2026, as well as other merger related items:
- Signature's closing balance sheet - The fair values of the acquired assets, loans, and deposits were $1.90 billion, $1.36 billion, and $1.65 billion, respectively, giving rise to $246.9 million in goodwill and a $49.3 million core deposit intangible. The combined results for the third quarter of 2026 include two months of activity for Signature.
- Combined closing balance sheet - The combined assets, loans, deposits, equity, goodwill and core deposit intangible were approximately $4.75 billion, $3.31 billion, $3.92 billion, $778.7 million, and $296.2 million, respectively, on a purchase price of $466.1 million. The combination was approximately 10% accretive to tangible book value. Prior period information presented reflects Esquire's pre-merger financial information.
- Core systems conversions are in progress and targeted for April 2027. There has been no material client attrition to date and the combined company's financial information and performance metrics remain materially unchanged with certain performance metrics improving from announcement date as noted below.
"This transformational merger enhances our operating profile, expands our resources, and diversifies our balance sheet, bringing together two institutions with highly complementary commercial banking operations and capabilities for continued expansion nationally," stated Andrew C. Sagliocca, Vice Chairman, CEO & President. "Most importantly, the merger unites two highly talented management teams with strong client relationships and market expertise, positioning the combined company for continued industry-leading growth, performance metrics and enhanced success."
Significant achievements and key performance metrics during the current quarter and year-to-date of 2026 include:
- Net income increased $4.5 million, or 34.7%, to $17.5 million for the third quarter of 2026, compared to $13.0 million in the second quarter of 2026. Diluted earnings per share were $1.57, compared to $1.49 in the prior linked quarter. Excluding $8.9 million of pretax merger expenses ($7.1 million, net of tax) and $938 thousand of discrete tax benefits related to share-based compensation, adjusted(1) net income and diluted earnings per share for the third quarter of 2026 were $23.6 million and $2.12, respectively. For the second quarter of 2026, adjusted(1) net income and diluted earnings per share were $14.0 million and $1.60, respectively, excluding pretax merger expenses of $1.1 million ($970 thousand, net of tax).
- Returns on average assets and equity were 1.73% and 11.11%, respectively, for the third quarter of 2026, compared to 2.09% and 17.06% in the prior linked quarter. Excluding the previously noted after-tax merger expenses and discrete tax benefit item, adjusted(1) returns on average assets and tangible equity(1) were an industry leading 2.34% and 23.10%, respectively, as compared to 2.25% and 18.33%, respectively, for the linked quarter.
- Strong net interest margin of 5.74%, compared to 5.96% in the prior linked quarter, considering the impact of the Signature merger. The current quarter's net interest margin was positively impacted by approximately 6 basis points as the acquired interest-earning assets and interest-bearing liabilities of Signature, at fair value, impacted the combined net interest margin for two out of the three months in the current quarter.
- Loans increased $1.52 billion ($1.38 billion from the Signature merger), or 80.1%, to $3.43 billion from June 30, 2026. The remaining increase was primarily driven by organic litigation-related loan growth of $159.6 million, or 48.9% annualized, to $1.46 billion and represented 42.5% of total loans, compared to 68.1% in the prior linked quarter. Since the acquisition date of Signature on August 1, 2026, loans increased $111.4 million, or 20.1% annualized, to $3.43 billion in the current quarter, primarily driven by litigation-related loan growth.
- Deposits increased $1.80 billion ($1.65 billion from the Signature merger), or 82.5%, to $3.98 billion from June 30, 2026. The remaining increase was primarily driven by litigation-related deposit growth. Noninterest bearing demand deposits totaled $1.11 billion, or 27.9% of total deposits, and the cost of funds for the quarter ended September 30, 2026, including demand deposits, was 1.13%. Since the acquisition date of Signature on August 1, 2026, total deposits increased $55.0 million, or 8.4% annualized, to $3.98 billion in the current quarter.
- Off-balance sheet ("OBS") sweep funds totaled $775.5 million, with approximately 32.9% available for additional on-balance sheet liquidity, while the associated administrative service payments ("ASP") fee income totaled $1.1 million for the current quarter. Additional available liquidity totaled approximately $865.2 million, excluding cash, OBS sweep funds, and unsecured borrowing capacity.
- Solid credit metrics, asset quality, and reserve coverage ratios with the allowance for credit losses totaling $44.7 million, or 1.30% of loans, and nonperforming loans and nonperforming assets totaling $8.6 million and $9.6 million, respectively, representing 0.25% of total loans and 0.20% of total assets, respectively.
- Noninterest income increased $1.5 million, or 23.5%, to $7.9 million, representing 12.8% of total revenue, led by our payment processing platform with 94,000 small business clients nationally. Our tech-enabled payments platform allowed us to perform commercial treasury clearing services for $10.5 billion in credit and debit card payment volume across 152.2 million transactions in all 50 states. Other noninterest income included ASP fee income and other client related services charges totaling $1.1 million and $1.4 million, respectively.
- Efficiency ratio(1) was 58.6% for the current quarter (including $8.9 million of merger expenses and $1.8 million of core deposit intangible ("CDI") amortization) compared to 50.1% in the prior linked quarter (including $1.1 million of merger expenses). The adjusted efficiency ratios(1) were 41.1% in the current quarter compared to 47.6% in the prior linked quarter, excluding the previously mentioned merger charges and CDI amortization.
- Key recognitions during the current quarter include: (1) ranked #3 among the top-performing publicly traded U.S. banks in Bank Director's 2026 RankingBanking; and (2) named a top deposit franchise by S&P Global Market Intelligence for the third consecutive year.
- Strong capital foundation with common equity tier 1 ("CET1") and tangible common equity to tangible assets(1) ("TCE/TA") ratios of 12.95% and 10.91%, respectively. The Bank remains well above the bank regulatory "Well Capitalized" standards.
"The Signature merger extends our client-centric approaches to a larger, more diversified client base, building long-term relationships that allow our clients to grow, while concurrently generating strong organic growth for our combined company," stated Tony Coelho, Chairman of the Board. "With a broader client base, a more diversified loan and deposit foundation, and more resources to allow greater scale, we are positioned to pursue long-term growth while preserving access to key decision-makers to ensure continuity of services that our clients value and have come to expect."
"The success of the current quarter's growth, performance metrics, and merger closing is a credit to our caring and diligent management teams and valued employees in New York and Chicago as well as our BDOs across the country," stated Andrew C. Sagliocca, Vice Chairman, CEO & President. "The Signature merger coupled with our combined asset size, enhanced resources, and diversified loan and deposit platforms positions Esquire for continued industry leading growth and performance, exceeding our initial earnings expectations when we announced the merger on March 12, 2026."
(1) | See non-GAAP reconciliation provided at the end of this news release. |
Third Quarter 2026 vs. 2025
Net income for the quarter ended September 30, 2026 was $17.5 million, or $1.57 per diluted share, compared to $14.1 million, or $1.62 per diluted share for the same period in 2025. Returns on average assets and equity for the current quarter were 1.73% and 11.11%, respectively, compared to 2.61% and 20.83% for the same period of 2025. Adjusted(1) net income, diluted earnings per share, return on average assets, and return on average tangible common equity were $23.6 million, $2.12, 2.34% and 23.10%, respectively.
Net interest income increased $22.2 million, or 70.6%, to $53.5 million, due to growth in average interest earning assets totaling $1.64 billion (approximately $1.19 billion related to the Signature merger), or 79.7%, to $3.70 billion. We continue to generate strong organic growth in the quarter funded with low-cost core deposits from our combined regional business development teams and existing relationship banking efforts. Our net interest margin decreased 30 basis points to 5.74%, primarily due to the impact of the Signature merger. The resilience of our combined net interest margin reflects the strength of both the legacy Esquire franchise and the Signature acquired net interest earning assets at fair value, driving industry leading returns. Our net interest margin was positively impacted by approximately 6 basis points in the current quarter as the acquired interest-earning assets and interest-bearing liabilities of Signature, at fair value, impacted the combined net interest margin for two out of the three months in the current quarter. Average loan yields decreased 41 basis points to 7.57%, primarily due to the composition of the acquired loans in the merger. Average loans increased $1.36 billion (approximately $903.9 million related to the Signature merger), or 88.7%, to $2.89 billion, with the remaining organic growth led by our litigation-related loans totaling $420.0 million, or 44.2%, to $1.37 billion in the current quarter. Loan interest income increased $24.4 million, or 79.0%, to $55.2 million with $26.0 million related to growth in average loan volumes (primarily driven by the merger and litigation-related commercial loan growth), offset by $1.7 million from decreases in average loan rates, primarily a result of the acquired Signature loan portfolio. Average securities increased $142.1 million, or 42.1%, to $479.8 million with yields increasing 23 basis points to 4.04% with both increases driven by the Signature merger. Average deposits increased $1.49 billion ($1.08 billion related to the Signature merger), or 80.6%, to $3.34 billion. We continue to generate core organic deposit growth led by our litigation-related (both IOLTA/NOW and money market) growth totaling $398.5 million, or 31.8%. Our cost of deposits, including noninterest bearing demand deposits, increased 10 basis points to 1.13%, primarily due to the Signature merger. Our loan-to-deposit ratio was 86% at September 30, 2026.
The provision for credit losses was $1.8 million for the third quarter of 2026, a $50 thousand increase from the third quarter of 2025. As of September 30, 2026, our allowance to loans ratio was 1.30%, as compared to 1.37% in the prior year quarter. Based on management's evaluation of current credit risk in our loan portfolio, including the acquired loans from the Signature merger, management believes the allowance for credit losses is adequate at September 30, 2026.
Noninterest income totaled $7.9 million in the current quarter, an increase of $1.7 million ($1.5 million related to fee income generated by Signature's existing banking platform and related commercial client base) from the third quarter of 2025. Payment processing income was $5.4 million for the third quarter of 2026, an increase of $375 thousand compared to the prior year quarter, as fee income growth has been muted in the legacy Esquire payment processing platform, primarily due to changes in our overall merchant risk profile and merchant composition. Payment processing volumes for the legacy Esquire credit and debit card processing platform increased $416.0 million, or 4.1%, to $10.5 billion while transaction volume totaled 152.2 million for the current quarter. We continue to focus on the expansion of merchant sales channels through our current and future ISOs, new merchant originations, active management of our merchant risk profiles, potential commercial clients in the Chicago and Midwest markets from our Signature merger, and by expanding our technology and other resources in the payment vertical. The Company utilizes proprietary and industry leading/customized technology to ensure card brand and regulatory compliance, to support multiple processing platforms, to manage daily risk across 94,000 small business merchants in all 50 states, and to perform commercial treasury clearing services for $10.5 billion in volume across 152.2 million transactions in the current quarter. ASP fees totaled $1.1 million, an increase of $321 thousand from the prior year quarter, and are directly impacted by the average balance of OBS sweep funds as well as current short-term market interest rates. Other customer related fees and services charges totaling $1.4 million are primarily related to fee income generated by Signature's existing banking platform and related commercial client base.
Noninterest expense increased $17.6 million, or 95.9%, to $36.0 million for the third quarter of 2026 compared to the same period in 2025. The increase primarily reflects the acquisition of Signature, including two months of its operating expenses totaling $5.1 million following the August 1, 2026 closing, $8.9 million of merger expenses, and $1.8 million of core deposit intangible amortization, together with continued investment in personnel and technology to support organic growth. Employee compensation and benefits costs increased $5.1 million ($3.4 million related to the Signature merger), or 47.1%, to $16.0 million, reflecting the addition of Signature's personnel and continued investment in our employees across all departments as well as technology to primarily support our national litigation franchise.
Other noninterest expenses increased $2.0 million ($1.7 million related to the Signature merger) to $9.3 million, reflecting the expanded operating footprint and infrastructure of the combined company, together with ongoing investment in business development, client service and risk management.
The Company's efficiency ratio was 58.6% for the three months ended September 30, 2026, as compared to 48.9% in 2025. The adjusted(1) efficiency ratio was 41.1%, excluding merger related expenses of $8.9 million and amortization of core deposit intangible of $1.8 million. Signature's complementary limited-branch commercial banking model and technology-enabled operations provide additional scale to support continued growth while maintaining investment in experienced bankers, client service and risk management.
The effective tax rate was 26.0% for the third quarter of 2026, as compared to 19.5% in the prior year quarter. The increase was primarily due to certain incremental discrete tax benefits related to share-based compensation in the prior year quarter. Excluding the merger related charges (and related tax effect) as well as certain discrete tax benefits related to share-based compensation, our adjusted(1) effective tax rate was approximately 27.4% in the current quarter.
(1) | See non-GAAP reconciliation provided at the end of this news release. |
Year-to-Date 2026 vs. 2025
Net income for the nine months ended September 30, 2026 was $42.7 million, or $4.48 per diluted share, compared to $37.4 million, or $4.32 per diluted share for the same period in 2025. Returns on average assets and equity were 1.93% and 13.94%, respectively, compared to 2.46% and 19.60% for the same period of 2025. Adjusted(1) net income, diluted earnings per share, return on average assets, and return on average tangible common equity were $51.3 million, $5.38, 2.32% and 20.52%, respectively.
Net interest income increased $35.1 million, or 39.7%, to $123.3 million, due to growth in average interest earning assets totaling $838.6 million (approximately $402.7 million related to the Signature merger), or 42.7%, to $2.80 billion. We continued to generate strong organic growth for the year, funded with low-cost core deposits from our regional business development teams and existing relationship banking efforts. Our net interest margin decreased 13 basis points to 5.88%, primarily from the impact of the Signature merger. Average loan yields decreased 18 basis points to 7.71%, primarily due to the composition of the acquired loans in the merger, while average loans increased $720.5 million ($304.6 million related to the Signature merger), or 49.2%, to $2.18 billion, with average legacy litigation-related loan growth totaling $393.7 million, or 44.4%. Loan interest income increased $39.5 million, or 45.7%, to $125.9 million with $41.6 million related to growth in average loan volumes, driven primarily by the merger and litigation related commercial growth, offset by $2.1 million in decreases from average loan rates, primarily as a result of acquired loans and, to a lesser extent, decreases in short-term market interest rates. Average securities increased $46.7 million to $379.6 million with yields increasing 13 basis points to 3.91%, with both increases primarily driven by the Signature merger. Average deposits increased $759.6 million ($363.0 million related to the Signature merger), or 43.2%, to $2.52 billion. We continue to generate core organic deposit growth, led by our litigation-related (both IOLTA/NOW and money market) growth totaling $368.4 million, or 31.3%. Our cost of deposits, including noninterest bearing demand deposits, increased 8 basis points to 1.07% primarily due to the Signature merger.
The provision for credit losses was $7.4 million for the nine months ended September 30, 2026, a $625 thousand increase from the comparable period in 2025. As of September 30, 2026, our allowance to loans ratio was 1.30%. Based on management's evaluation of current credit risk in our loan portfolio, management believes the allowance for credit losses is adequate at September 30, 2026.
Noninterest income totaled $20.7 million for the nine months ended September 30, 2026, an increase of $1.8 million ($1.5 million related to fee income generated by Signature's existing banking platform and related commercial client base) from the same period in 2025. Payment processing income was $15.7 million for the nine months ended September 30, 2026, an increase of $625 thousand compared to 2025, as growth in the legacy Esquire payment processing income has been muted, primarily due to changes in our overall merchant risk profile and merchant composition. Payment processing volumes for the legacy Esquire credit and debit card processing platform increased $1.3 billion, or 4.3%, to $30.8 billion while transaction volume totaled 442.1 million for the current nine months. ASP fees totaled $3.3 million, an increase of $1.0 million from the same period in 2025, a direct result of the average balance of OBS sweep funds. In 2025, we recognized a $432 thousand gain on the sale of a fintech investment.
Noninterest expense increased $25.6 million, or 49.0%, to $77.7 million for 2026 compared to the same period in 2025. The increase primarily reflects $11.2 million in merger expenses, approximately $5.1 million in Signature's operating expenses for the two months following the August 1, 2026 merger closing, and $1.8 million of core deposit intangible amortization, together with continued investment in the Company's personnel, technology and business development capabilities. Employee compensation and benefits costs increased $9.7 million ($3.4 million related to the Signature merger), or 31.0%, to $40.8 million, reflecting the addition of Signature's personnel and continued investment in employees across all departments as well as technology to primarily support our national litigation franchise. Other noninterest expenses increased $3.1 million to $23.9 million ($1.7 million related to the Signature merger), reflecting the expanded operations of the combined company and continued investment to support organic growth.
The Company's efficiency ratio was 54.0% for 2026, as compared to 48.7% in 2025. The adjusted(1) efficiency ratio was 44.6%, excluding the merger expenses of $11.2 million, amortization of core deposit intangible of $1.8 million, and accelerated stock compensation of $398 thousand.
The effective tax rate was 27.5% for the nine months ended September 30, 2026, as compared to 22.5% in the prior year period. The increase was primarily due to certain incremental discrete tax benefits related to share-based compensation in the prior year period.
(1) | See non-GAAP reconciliation provided at the end of this news release. |
Asset Quality
At September 30, 2026, we had five nonperforming loans totaling $8.6 million and one property acquired in the Signature merger in other real estate owned ("OREO") totaling $1.0 million. Nonperforming loans included two legacy Esquire loans totaling $5.1 million, and three acquired Signature nonperforming loans totaling $3.5 million. These loans were individually evaluated based on borrower-specific credit information and expected recoveries and their carrying amount is deemed collectible. The allowance for credit losses was $44.7 million, or 1.30% of total loans, as compared to $21.1 million, or 1.37% of total loans at September 30, 2025. The increase in the allowance for credit losses primarily related to the merger with Signature. The ratio of nonperforming loans to total loans and nonperforming assets to total assets were 0.25% and 0.20%, respectively, at September 30, 2026. Based on management's evaluation of current credit risk in our loan portfolio, the Signature merger, increases in the general reserves considering loan growth, loan composition, and the current uncertain economic and short-term interest rate environment, management believes the allowance for credit losses is adequate at September 30, 2026.
The following table provides information regarding asset quality for the periods presented:
September 30, | December 31, | September 30, | |||||||
2026 | 2025 | 2025 | |||||||
(in thousands) | |||||||||
Nonperforming loans held for investment | |||||||||
Multifamily | $ | 4,400 | $ | 7,836 | $ | 7,910 | |||
Commercial real estate | 2,108 | - | - | ||||||
Construction | 396 | - | - | ||||||
Commercial | 1,690 | 736 | 736 | ||||||
Total nonperforming loans held for investment | $ | 8,594 | $ | 8,572 | $ | 8,646 | |||
OREO | 1,000 | - | - | ||||||
Nonperforming assets | $ | 9,594 | $ | 8,572 | $ | 8,646 | |||
Nonperforming loans to total loans | 0.25 | % | 0.49 | % | 0.56 | % | |||
Nonperforming loans to total assets | 0.18 | 0.36 | 0.40 | ||||||
Nonperforming assets to total assets | 0.20 | 0.36 | 0.40 | ||||||
Balance Sheet - September 30, 2026 vs. 2025
At September 30, 2026, total assets increased $2.62 billion ($1.90 billion related to the Signature merger), or 120.0%, to $4.81 billion. This increase was primarily attributable to the merger with Signature as well as organic loan growth totaling $497.3 million, or 32.1%. Our higher yielding commercial loans increased $1.09 billion ($667.6 million related to the Signature merger), or 103.6%, to $2.13 billion with commercial litigation-related loans increasing $461.4 million, or 46.5%, to $1.45 billion. Our commercial relationship banking sales pipeline remained robust, anchored by our regional senior BDOs (supported by commercial lending, risk, and operations) located in key markets throughout the U.S., including the Signature team with a focus on the Chicago and Midwest markets. The regional BDOs focused on our litigation vertical are supported by our best-in-class technology stack including, but not limited to; our proprietary CRM system, digital marketing cloud and lending based technology built on Salesforce supporting client relationships and lead acquisition initiatives; account-based digital marketing (or "ABM") with significant thought leadership content; and artificial intelligence (or "AI") for advanced data analytics across our platform powering personalized and real-time ABM content to both current clients and prospective clients. These BDOs have also significantly expanded our participation in local, state, and national trial associations across the country. The merger with Signature strengthens this growth potential in the Chicago and Midwest markets by adding an established Chicago commercial banking franchise and experienced bankers/BDOs with deep client relationships in the nation's fourth largest legal markets for contingent fee plaintiff law firms, with Los Angeles, CA and New York City, NY rounding out the top two metro markets.
The merger also broadened our commercial lending and core deposit base, diversified our loan and funding mix, and provided additional scale and resources to support continued growth nationally. Our available-for-sale securities portfolio increased $193.5 million to $458.7 million due primarily to the acquisition of Signature. Our held-to-maturity securities portfolio totaled $54.0 million, a decrease of $8.3 million, due to portfolio amortization.
The following table provides information regarding the composition of our loan portfolio for the periods presented:
September 30, | December 31, | September 30, | |||||||||||||||||||
2026 | 2025 | 2025 | |||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||
Real estate: | |||||||||||||||||||||
Multifamily | $ | 455,550 | 13.3 | % | $ | 372,800 | 21.2 | % | $ | 365,309 | 23.6 | % | |||||||||
Commercial real estate | 534,084 | 15.6 | 107,293 | 6.1 | 105,634 | 6.8 | |||||||||||||||
1?-?4 family | 42,101 | 1.2 | 9,835 | 0.6 | 10,013 | 0.7 | |||||||||||||||
Construction | 99,286 | 2.9 | - | - | - | - | |||||||||||||||
Total real estate | 1,131,021 | 33.0 | 489,928 | 27.9 | 480,956 | 31.1 | |||||||||||||||
Commercial: | |||||||||||||||||||||
Litigation related | 1,454,450 | 42.5 | 1,178,325 | 67.0 | 993,072 | 64.2 | |||||||||||||||
Other | 680,034 | 19.9 | 67,230 | 3.8 | 55,517 | 3.6 | |||||||||||||||
Total commercial | 2,134,484 | 62.4 | 1,245,555 | 70.8 | 1,048,589 | 67.8 | |||||||||||||||
Consumer | 159,698 | 4.6 | 22,762 | 1.3 | 17,181 | 1.1 | |||||||||||||||
Total loans held for investment | $ | 3,425,203 | 100.0 | % | $ | 1,758,245 | 100.0 | % | $ | 1,546,726 | 100.0 | % | |||||||||
Deferred loan fees and unearned premiums, net | 334 | 182 | 254 | ||||||||||||||||||
Loans, held for investment | $ | 3,425,537 | $ | 1,758,427 | $ | 1,546,980 | |||||||||||||||
The following table provides information regarding the composition of our deposits for the periods presented:
September 30, | December 31, | September 30, | ||||||||||||||||
2026 | 2025 | 2025 | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||
Deposits: | ||||||||||||||||||
DDA | $ | 1,110,420 | 27.9 | % | $ | 576,455 | 27.9 | % | $ | 605,533 | 32.2 | % | ||||||
Savings | 150,555 | 3.8 | 37,458 | 1.8 | 22,172 | 1.2 | ||||||||||||
NOW | 1,625,985 | 40.9 | 1,230,885 | 59.7 | 1,022,482 | 54.4 | ||||||||||||
Money Market | 1,027,732 | 25.8 | 212,037 | 10.3 | 223,196 | 11.9 | ||||||||||||
Time | 63,198 | 1.6 | 6,172 | 0.3 | 6,057 | 0.3 | ||||||||||||
Total Deposits | $ | 3,977,890 | 100.0 | % | $ | 2,063,007 | 100.0 | % | $ | 1,879,440 | 100.0 | % | ||||||
Total deposits were $3.98 billion as of September 30, 2026, a $2.10 billion ($1.65 billion related to the Signature merger), or 111.7%, increase from September 30, 2025. This increase was primarily attributable to the merger with Signature as well as organic deposit growth totaling $447.4 million, or 23.8%, with the NOW/IOLTA and money market categories totaling $362.6 million and $211.6 million, respectively, offset by noninterest bearing demand decreasing $123.0 million. Our deposit strategy focuses on building full-service commercial banking relationships through lending, payment processing and tailored treasury management solutions, with deposit growth driven primarily by our client relationships rather than rate competition. The merger with Signature strengthens this strategy by adding an established, relationship-focused commercial banking franchise with a diversified, low-cost core deposit base in the Chicago and Midwest markets. The merger broadened our funding sources, reduced our reliance on litigation-related deposits and enhanced our capacity to support continued growth across our national platforms. Our longer duration IOLTA, escrow and settlement deposits represent $1.56 billion, or 39.3%, of total deposits. As of September 30, 2026, uninsured deposits were $1.67 billion, or 42.1%, of our total deposits, excluding $24.1 million of the Company's deposits held at the Bank. Approximately 50% of our uninsured deposits represent clients with full commercial relationship banking with us including, but not limited to, commercial loans, payment processing, and various commercial service-oriented relationships including law firm operating accounts, law firm IOLTA/escrow accounts, merchant reserves, ISO reserves, ACH processing, and custodial accounts.
Due to the nature of our larger mass tort and class action settlements related to the litigation vertical, we participate in FDIC insured sweep programs as well as treasury secured money market funds. As of September 30, 2026, OBS sweep funds totaled approximately $775.5 million, with approximately $255.4 million, or 32.9%, available to be swept on balance sheet as reciprocal client relationship deposits. Our core low-cost deposit growth and off-balance sheet client funds continue to clearly demonstrate our highly efficient, full service commercial relationships and tech-enabled cash management platform on a national basis.
At September 30, 2026, we had the ability to borrow, on a secured basis, up to $823.2 million from the FHLB of New York and $42.0 million from the FRB of New York discount window. The increase in our borrowing capacity was due to the Signature merger. At September 30, 2026 we had a $2.2 million outstanding borrowing with the FHLB of Chicago as a result of the merger. Historically, we have not leveraged our balance sheet to generate earnings and have always utilized core client deposits to fund our asset growth and related earnings.
Stockholders' equity increased $507.4 million to $786.6 million as of September 30, 2026, primarily attributable to equity consideration of $466.1 million as a result of the merger with Signature as well as increases in retained earnings (net income less dividends paid to stockholders), and to a lesser extent, additional paid-in-capital from share-based compensation, offset by increases in other comprehensive losses related to our available-for-sale securities portfolio and treasury stock.
The Bank remains well above bank regulatory "Well Capitalized" standards.
Earnings Call Information
The Company will conduct a conference call on Tuesday, October 27, 2026 at 10:00 a.m. (ET), during which Andrew C. Sagliocca, Vice Chairman, Chief Executive Officer and President, and Michael Lacapria, Senior Vice President and Chief Financial Officer, will discuss Esquire's third quarter financial performance, followed by a question-and-answer period.
The live audio webcast can be accessed via the following link: https://events.q4inc.com/attendee/886920992
Corresponding presentation slides and a replay of the conference call will be available on Esquire's Investor Relations web page at investorrelations.esquirebank.com. The conference call may also be accessed by telephone using the dial-in information below:
Conference Call Details
North America: (833) 461-5787
Meeting ID: 886 920 992
About Esquire Financial Holdings, Inc.
Esquire Financial Holdings, Inc. is a financial holding company headquartered in Jericho, New York. Its wholly owned subsidiary, Esquire Bank, is a full-service commercial bank, with five branch offices in Jericho, NY, Los Angeles, CA, and Chicago, IL, as well as an administrative office in Boca Raton, Florida. The Bank is dedicated to serving the financial needs of the litigation industry and small businesses nationally, as well as commercial and retail customers in the New York, Chicago, and Los Angeles metropolitan areas. The Bank offers tailored financial and payment processing solutions to the litigation community and their clients as well as dynamic and flexible payment processing solutions to small business owners. For more information, visit www.esquirebank.com.
Cautionary Note Regarding Forward-Looking Statements
This press release includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 relating to future results of the Company. Forward-looking statements are subject to many risks and uncertainties, including, but not limited to: changes in business plans as circumstances warrant; changes in general economic, business and political conditions, including changes in the financial markets; the ability to complete; any failure to realize the anticipated benefits of the Signature transaction when expected or at all; risks relating to the integration of the Company and Signature; potential adverse reactions or changes to business or employee relationships, including those resulting from the completion of the merger and integration of the companies and other risks detailed in the "Cautionary Note Regarding Forward-Looking Statements," "Risk Factors" and other sections of the Company's Annual Report on Form 10-K and Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission. The forward-looking statements included in this press release are not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking statements. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "might," "should," "could," "predict," "potential," "believe," "expect," "attribute," "continue," "will," "anticipate," "seek," "estimate," "intend," "plan," "projection," "goal," "target," "aim," "would," "annualized" and "outlook," or similar terminology. Any forward-looking statements presented herein are made only as of the date of this press release, and the Company does not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise, except as may be required by law.
ESQUIRE FINANCIAL HOLDINGS, INC. Consolidated Statement of Condition (unaudited) (dollars in thousands except per share data) | ||||||||||
September 30, | December 31, | September 30, | ||||||||
2026 | 2025 | 2025 | ||||||||
ASSETS | ||||||||||
Cash and cash equivalents | $ | 471,501 | $ | 235,887 | $ | 240,759 | ||||
Securities available-for-sale, at fair value | 458,672 | 246,505 | 265,132 | |||||||
Securities held-to-maturity, at cost | 53,997 | 60,193 | 62,288 | |||||||
Securities, restricted at cost | 9,506 | 3,173 | 3,173 | |||||||
Loans, held for investment | 3,425,537 | 1,758,427 | 1,546,980 | |||||||
Less: allowance for credit losses | (44,677) | (24,022) | (21,119) | |||||||
Loans, net of allowance | 3,380,860 | 1,734,405 | 1,525,861 | |||||||
Premises and equipment, net | 3,769 | 4,379 | 4,408 | |||||||
Goodwill | 246,883 | - | - | |||||||
Core deposit intangible | 47,499 | - | - | |||||||
Other assets | 132,718 | 81,119 | 82,690 | |||||||
Total Assets | $ | 4,805,405 | $ | 2,365,661 | $ | 2,184,311 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||
Demand deposits | $ | 1,110,420 | $ | 576,455 | $ | 605,533 | ||||
Savings, NOW and money market deposits | 2,804,272 | 1,480,380 | 1,267,850 | |||||||
Certificates of deposit | 63,198 | 6,172 | 6,057 | |||||||
Total deposits | 3,977,890 | 2,063,007 | 1,879,440 | |||||||
Other liabilities | 40,900 | 13,056 | 25,644 | |||||||
Total liabilities | 4,018,790 | 2,076,063 | 1,905,084 | |||||||
Total stockholders' equity | 786,615 | 289,598 | 279,227 | |||||||
Total Liabilities and Stockholders' Equity | $ | 4,805,405 | $ | 2,365,661 | $ | 2,184,311 | ||||
Selected Financial Data | ||||||||||
Common shares outstanding | 12,159,646 | 8,552,405 | 8,565,491 | |||||||
Book value per share | $ | 64.69 | $ | 33.86 | $ | 32.60 | ||||
Tangible book value per share (1) | 40.48 | 33.86 | 32.60 | |||||||
Tangible equity to tangible assets (1) | 10.91 | 12.24 | 12.78 | |||||||
Capital Ratios | ||||||||||
Consolidated Company | ||||||||||
Tier 1 leverage ratio | 11.76 | % | 13.25 | % | 13.59 | % | ||||
Common equity tier 1 capital ratio | 13.45 | 15.37 | 16.75 | |||||||
Tier 1 capital ratio | 13.45 | 15.37 | 16.75 | |||||||
Total capital ratio | 14.14 | 16.62 | 18.00 | |||||||
Bank | ||||||||||
Tier 1 leverage ratio | 11.20 | % | 11.87 | % | 12.00 | % | ||||
Common equity tier 1 capital ratio | 12.95 | 14.18 | 15.27 | |||||||
Tier 1 capital ratio | 12.95 | 14.18 | 15.27 | |||||||
Total capital ratio | 13.65 | 15.43 | 16.52 | |||||||
Asset Quality | ||||||||||
Nonperforming loans | $ | 8,594 | $ | 8,572 | $ | 8,646 | ||||
Nonperforming assets | 9,594 | 8,572 | 8,646 | |||||||
Allowance for credit losses to total loans | 1.30 | % | 1.37 | % | 1.37 | % | ||||
Nonperforming loans to total loans | 0.25 | 0.49 | 0.56 | |||||||
Nonperforming loans to total assets | 0.18 | 0.36 | 0.40 | |||||||
Nonperforming assets to total assets | 0.20 | 0.36 | 0.40 | |||||||
Allowance to nonperforming loans | 520 | 280 | 244 | |||||||
___________________ | ||||||||||
(1) See non-GAAP reconciliation provided at the end of this news release. | ||||||||||
ESQUIRE FINANCIAL HOLDINGS, INC. Consolidated Income Statement (unaudited) (dollars in thousands except per share data) | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | June 30, | September 30, | September 30, | |||||||||||||
2026 | 2026 | 2025 | 2026 | 2025 | ||||||||||||
Interest income | $ | 63,138 | $ | 41,301 | $ | 36,131 | $ | 143,472 | $ | 101,180 | ||||||
Interest expense | 9,632 | 5,553 | 4,792 | 20,214 | 12,978 | |||||||||||
Net interest income | 53,506 | 35,748 | 31,339 | 123,258 | 88,202 | |||||||||||
Provision for credit losses | 1,800 | 2,900 | 1,750 | 7,400 | 6,775 | |||||||||||
Net interest income after provision for credit losses | 51,706 | 32,848 | 29,589 | 115,858 | 81,427 | |||||||||||
Noninterest income: | ||||||||||||||||
Payment processing fees | 5,444 | 5,126 | 5,069 | 15,713 | 15,088 | |||||||||||
Administrative service income | 1,052 | 1,092 | 731 | 3,281 | 2,254 | |||||||||||
Other noninterest income | 1,389 | 165 | 433 | 1,729 | 1,619 | |||||||||||
Total noninterest income | 7,885 | 6,383 | 6,233 | 20,723 | 18,961 | |||||||||||
Noninterest expense: | ||||||||||||||||
Employee compensation and benefits | 15,958 | 12,605 | 10,852 | 40,784 | 31,133 | |||||||||||
Merger expenses | 8,887 | 1,070 | 210 | 11,229 | 210 | |||||||||||
Amortization of core deposit intangible | 1,827 | - | - | 1,827 | - | |||||||||||
Other expenses | 9,295 | 7,430 | 7,298 | 23,889 | 20,827 | |||||||||||
Total noninterest expense | 35,967 | 21,105 | 18,360 | 77,729 | 52,170 | |||||||||||
Income before income taxes | 23,624 | 18,126 | 17,462 | 58,852 | 48,218 | |||||||||||
Income taxes | 6,142 | 5,148 | 3,405 | 16,181 | 10,864 | |||||||||||
Net income | $ | 17,482 | $ | 12,978 | $ | 14,057 | $ | 42,671 | $ | 37,354 | ||||||
Earnings Per Share | ||||||||||||||||
Basic | $ | 1.65 | $ | 1.57 | $ | 1.74 | $ | 4.71 | $ | 4.65 | ||||||
Diluted | 1.57 | 1.49 | 1.62 | 4.48 | 4.32 | |||||||||||
Basic - adjusted (1) | 2.23 | 1.69 | 1.60 | 5.67 | 4.51 | |||||||||||
Diluted - adjusted (1) | 2.12 | 1.60 | 1.49 | 5.38 | 4.19 | |||||||||||
Weighted average basic shares | 10,598,905 | 8,274,280 | 8,094,441 | 9,050,562 | 8,038,047 | |||||||||||
Weighted average diluted shares | 11,143,493 | 8,726,355 | 8,690,130 | 9,532,466 | 8,646,398 | |||||||||||
Selected Financial Data | ||||||||||||||||
Return on average assets | 1.73 | % | 2.09 | % | 2.61 | % | 1.93 | % | 2.46 | % | ||||||
Return on average equity | 11.11 | 17.06 | 20.83 | 13.94 | 19.60 | |||||||||||
Net interest margin | 5.74 | 5.96 | 6.04 | 5.88 | 6.01 | |||||||||||
Efficiency ratio | 58.6 | 50.1 | 48.9 | 54.0 | 48.7 | |||||||||||
Adjusted return on average assets (1) | 2.34 | 2.25 | 2.41 | 2.32 | 2.39 | |||||||||||
Adjusted return on average tangible equity (1) | 23.10 | 18.33 | 19.20 | 20.52 | 19.03 | |||||||||||
Adjusted efficiency ratio (1) | 41.1 | 47.6 | 48.3 | 44.6 | 48.5 | |||||||||||
Cash dividends paid per common share | $ | 0.200 | $ | 0.200 | $ | 0.175 | $ | 0.600 | $ | 0.525 | ||||||
____________________ | ||||||||||||||||
(1) See non-GAAP reconciliation provided at the end of this news release. | ||||||||||||||||
ESQUIRE FINANCIAL HOLDINGS, INC. Consolidated Average Balance Sheets and Average Yield/Cost (unaudited) (dollars in thousands) | |||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||
September 30, | June 30, | September 30, | |||||||||||||||||||||||
2026 | 2026 | 2025 | |||||||||||||||||||||||
Average | Average | Average | Average | Average | Average | ||||||||||||||||||||
Balance | Interest | Yield/Cost | Balance | Interest | Yield/Cost | Balance | Interest | Yield/Cost | |||||||||||||||||
INTEREST EARNING ASSETS | |||||||||||||||||||||||||
Loans, held for investment | $ | 2,892,413 | $ | 55,207 | 7.57 | % | $ | 1,876,857 | $ | 36,417 | 7.78 | % | $ | 1,532,484 | $ | 30,839 | 7.98 | % | |||||||
Securities, includes restricted stock | 479,845 | 4,884 | 4.04 | % | 322,761 | 3,046 | 3.79 | % | 337,705 | 3,244 | 3.81 | % | |||||||||||||
Interest earning cash and other | 328,772 | 3,047 | 3.68 | % | 205,031 | 1,838 | 3.60 | % | 189,418 | 2,048 | 4.29 | % | |||||||||||||
Total interest earning assets | 3,701,030 | 63,138 | 6.77 | % | 2,404,649 | 41,301 | 6.89 | % | 2,059,607 | 36,131 | 6.96 | % | |||||||||||||
NONINTEREST EARNING ASSETS | 299,758 | 80,188 | 74,791 | ||||||||||||||||||||||
TOTAL AVERAGE ASSETS | $ | 4,000,788 | $ | 2,484,837 | $ | 2,134,398 | |||||||||||||||||||
INTEREST BEARING LIABILITIES | |||||||||||||||||||||||||
Savings, NOW, Money Market deposits | $ | 2,327,225 | $ | 9,132 | 1.56 | % | $ | 1,571,288 | $ | 5,502 | 1.40 | % | $ | 1,275,061 | $ | 4,739 | 1.47 | % | |||||||
Time deposits | 45,239 | 417 | 3.66 | % | 6,415 | 50 | 3.13 | % | 6,092 | 52 | 3.39 | % | |||||||||||||
Total interest bearing deposits | 2,372,464 | 9,549 | 1.60 | % | 1,577,703 | 5,552 | 1.41 | % | 1,281,153 | 4,791 | 1.48 | % | |||||||||||||
Borrowings | 6,134 | 83 | 5.37 | % | 42 | 1 | 9.55 | % | 42 | 1 | 9.45 | % | |||||||||||||
Total interest bearing liabilities | 2,378,598 | 9,632 | 1.61 | % | 1,577,745 | 5,553 | 1.41 | % | 1,281,195 | 4,792 | 1.48 | % | |||||||||||||
NONINTEREST BEARING LIABILITIES | |||||||||||||||||||||||||
Demand deposits | 966,305 | 581,150 | 568,107 | ||||||||||||||||||||||
Other liabilities | 31,474 | 20,752 | 17,341 | ||||||||||||||||||||||
Total noninterest bearing liabilities | 997,779 | 601,902 | 585,448 | ||||||||||||||||||||||
Stockholders' equity | 624,411 | 305,190 | 267,755 | ||||||||||||||||||||||
TOTAL AVG. LIABILITIES AND EQUITY | $ | 4,000,788 | $ | 2,484,837 | $ | 2,134,398 | |||||||||||||||||||
Net interest income | $ | 53,506 | $ | 35,748 | $ | 31,339 | |||||||||||||||||||
Net interest spread | 5.16 | % | 5.48 | % | 5.48 | % | |||||||||||||||||||
Net interest margin | 5.74 | % | 5.96 | % | 6.04 | % | |||||||||||||||||||
Deposits (including nonint. demand deposits) | $ | 3,338,769 | $ | 9,549 | 1.13 | % | $ | 2,158,853 | $ | 5,552 | 1.03 | % | $ | 1,849,260 | $ | 4,791 | 1.03 | % | |||||||
ESQUIRE FINANCIAL HOLDINGS, INC. Consolidated Average Balance Sheets and Average Yield/Cost (unaudited) (dollars in thousands) | |||||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||
2026 | 2025 | ||||||||||||||||
Average | Average | Average | Average | ||||||||||||||
Balance | Interest | Yield/Cost | Balance | Interest | Yield/Cost | ||||||||||||
INTEREST EARNING ASSETS | |||||||||||||||||
Loans, held for investment | $ | 2,184,198 | $ | 125,922 | 7.71 | % | $ | 1,463,667 | $ | 86,411 | 7.89 | % | |||||
Securities, includes restricted stock | 379,554 | 11,108 | 3.91 | % | 332,872 | 9,413 | 3.78 | % | |||||||||
Interest earning cash and other | 237,249 | 6,442 | 3.63 | % | 165,824 | 5,356 | 4.32 | % | |||||||||
Total interest earning assets | 2,801,001 | 143,472 | 6.85 | % | 1,962,363 | 101,180 | 6.89 | % | |||||||||
NONINTEREST EARNING ASSETS | 152,358 | 68,370 | |||||||||||||||
TOTAL AVERAGE ASSETS | $ | 2,953,359 | $ | 2,030,733 | |||||||||||||
INTEREST BEARING LIABILITIES | |||||||||||||||||
Savings, NOW, Money Market deposits | $ | 1,789,012 | $ | 19,591 | 1.46 | % | $ | 1,196,256 | $ | 12,748 | 1.42 | % | |||||
Time deposits | 20,070 | 534 | 3.56 | % | 7,628 | 227 | 3.98 | % | |||||||||
Total interest bearing deposits | 1,809,082 | 20,125 | 1.49 | % | 1,203,884 | 12,975 | 1.44 | % | |||||||||
Borrowings | 2,204 | 89 | 5.40 | % | 42 | 3 | 9.55 | % | |||||||||
Total interest bearing liabilities | 1,811,286 | 20,214 | 1.49 | % | 1,203,926 | 12,978 | 1.44 | % | |||||||||
NONINTEREST BEARING LIABILITIES | |||||||||||||||||
Demand deposits | 709,641 | 555,235 | |||||||||||||||
Other liabilities | 23,229 | 16,796 | |||||||||||||||
Total noninterest bearing liabilities | 732,870 | 572,031 | |||||||||||||||
Stockholders' equity | 409,203 | 254,776 | |||||||||||||||
TOTAL AVG. LIABILITIES AND EQUITY | $ | 2,953,359 | $ | 2,030,733 | |||||||||||||
Net interest income | $ | 123,258 | $ | 88,202 | |||||||||||||
Net interest spread | 5.36 | % | 5.45 | % | |||||||||||||
Net interest margin | 5.88 | % | 6.01 | % | |||||||||||||
Deposits (including nonint. demand deposits) | $ | 2,518,723 | $ | 20,125 | 1.07 | % | $ | 1,759,119 | $ | 12,975 | 0.99 | % | |||||
ESQUIRE FINANCIAL HOLDINGS, INC.
Consolidated Non-GAAP Financial Measure Reconciliation (unaudited)
(dollars in thousands except per share data)
We believe that these non-GAAP financial measures provide information that is important to investors and that is useful in understanding our financial position, results and ratios. However, these non-GAAP financial measures are supplemental and are not a substitute for an analysis based on GAAP measures. As other companies may use different calculations for this measure, this presentation may not be comparable to other similarly titled measures by other companies.
Adjusted net income, which is used to compute adjusted earnings per share and adjusted return on average assets, excludes the impact of merger expenses, accelerated stock compensation, net of tax, and tax benefits related to exercise of expiring stock options that lowered our effective tax rate to 26.0% and 19.5% in the third quarter of 2026 and 2025, respectively.
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | June 30, | September 30, | September 30, | ||||||||||||
2026 | 2026 | 2025 | 2026 | 2025 | |||||||||||
Net income - GAAP | $ | 17,482 | $ | 12,978 | $ | 14,057 | $ | 42,671 | $ | 37,354 | |||||
Adjustments to net income: | |||||||||||||||
Merger expenses | 8,887 | 1,070 | 210 | 11,229 | 210 | ||||||||||
Accelerated stock compensation | - | - | - | 398 | - | ||||||||||
Tax benefits related to exercise of expiring stock options | (938) | - | (1,310) | (938) | (1,310) | ||||||||||
Income tax effect of adjustments | (1,812) | (100) | - | (2,032) | - | ||||||||||
Adjusted net income | $ | 23,619 | $ | 13,948 | $ | 12,957 | $ | 51,328 | $ | 36,254 | |||||
Diluted earnings per share - GAAP | $ | 1.57 | $ | 1.49 | $ | 1.62 | $ | 4.48 | $ | 4.32 | |||||
Adjusted diluted earnings per share - non-GAAP | 2.12 | 1.60 | 1.49 | 5.38 | 4.19 | ||||||||||
Average assets | $ | 4,000,788 | $ | 2,484,837 | $ | 2,134,398 | $ | 2,953,359 | $ | 2,030,733 | |||||
Return on average assets - GAAP | 1.73 | % | 2.09 | % | 2.61 | % | 1.93 | % | 2.46 | % | |||||
Adjusted return on average assets - non-GAAP | 2.34 | 2.25 | 2.41 | 2.32 | 2.39 | ||||||||||
Adjusted return on average tangible equity excludes the impact of merger expenses, accelerated stock compensation, amortization of core deposit intangible ("CDI"), net of tax, and tax benefits related to exercise of expiring stock options.
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | June 30, | September 30, | September 30, | ||||||||||||
2026 | 2026 | 2025 | 2026 | 2025 | |||||||||||
Net income - GAAP | $ | 17,482 | $ | 12,978 | $ | 14,057 | $ | 42,671 | $ | 37,354 | |||||
Adjustments to net income: | |||||||||||||||
Merger expenses | 8,887 | 1,070 | 210 | 11,229 | 210 | ||||||||||
Amortization of CDI, net of tax | 1,334 | - | - | 1,334 | - | ||||||||||
Accelerated stock compensation | - | - | - | 398 | - | ||||||||||
Tax benefits related to exercise of expiring stock options | (938) | - | (1,310) | (938) | (1,310) | ||||||||||
Income tax effect of adjustments | (1,812) | (100) | - | (2,032) | - | ||||||||||
Adjusted net income | $ | 24,953 | $ | 13,948 | $ | 12,957 | $ | 52,662 | $ | 36,254 | |||||
Average equity | $ | 624,411 | $ | 305,190 | $ | 267,755 | $ | 409,203 | $ | 254,776 | |||||
Less average: | |||||||||||||||
Goodwill | 163,461 | - | - | 55,086 | - | ||||||||||
CDI | 32,388 | - | - | 10,914 | - | ||||||||||
Average tangible equity | $ | 428,562 | $ | 305,190 | $ | 267,755 | $ | 343,203 | $ | 254,776 | |||||
Return on average equity - GAAP | 11.11 | % | 17.06 | % | 20.83 | % | 13.94 | % | 19.60 | % | |||||
Adjusted return on average tangible equity - non-GAAP | 23.10 | 18.33 | 19.20 | 20.52 | 19.03 | ||||||||||
ESQUIRE FINANCIAL HOLDINGS, INC.
Consolidated Non-GAAP Financial Measure Reconciliation (unaudited)
(dollars in thousands except per share data)
The following table presents a reconciliation of efficiency ratio (non-GAAP) and adjusted efficiency ratio (non-GAAP).
Adjusted noninterest expense, which is used to compute the adjusted efficiency ratio, excludes the impact of merger expenses, amortization of CDI, and accelerated stock compensation.
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | June 30, | September 30, | September 30, | ||||||||||||
2026 | 2026 | 2025 | 2026 | 2025 | |||||||||||
Efficiency ratio - non-GAAP(1) | 58.6 | % | 50.1 | % | 48.9 | % | 54.0 | % | 48.7 | % | |||||
Noninterest expense - GAAP | $ | 35,967 | $ | 21,105 | $ | 18,360 | $ | 77,729 | $ | 52,170 | |||||
Less: merger expenses | 8,887 | 1,070 | 210 | 11,229 | 210 | ||||||||||
Less: amortization of CDI | 1,827 | - | - | 1,827 | - | ||||||||||
Less: accelerated stock compensation | - | - | - | 398 | - | ||||||||||
Adjusted noninterest expense - non-GAAP | $ | 25,253 | $ | 20,035 | $ | 18,150 | $ | 64,275 | $ | 51,960 | |||||
Net interest income - GAAP | 53,506 | 35,748 | 31,339 | 123,258 | 88,202 | ||||||||||
Noninterest income - GAAP | 7,885 | 6,383 | 6,233 | 20,723 | 18,961 | ||||||||||
Total revenue - GAAP | $ | 61,391 | $ | 42,131 | $ | 37,572 | $ | 143,981 | $ | 107,163 | |||||
Adjusted efficiency ratio - non-GAAP(2) | 41.1 | % | 47.6 | % | 48.3 | % | 44.6 | % | 48.5 | % | |||||
(1) | The reported efficiency ratio is a non-GAAP measure calculated by dividing GAAP noninterest expense by the sum of GAAP net interest income and GAAP noninterest income. | |
(2) | The adjusted efficiency ratio is a non-GAAP measure calculated by dividing adjusted noninterest expense by the sum of GAAP net interest income and GAAP noninterest income. |
The following reconciles book value per common share and equity to assets (GAAP) to tangible book value per common share and tangible equity to tangible assets (non-GAAP).
Management believes that reporting the non-GAAP measures of tangible common equity and tangible assets more closely approximates the adequacy of capital for regulatory purposes.
September 30, | December 31, | September 30, | |||||||
2026 | 2025 | 2025 | |||||||
Tangible Equity | |||||||||
Total stockholders' equity | $ | 786,615 | $ | 289,598 | $ | 279,227 | |||
Less: | |||||||||
Goodwill | 246,883 | - | - | ||||||
CDI | 47,499 | - | - | ||||||
Tangible equity | $ | 492,233 | $ | 289,598 | $ | 279,227 | |||
Tangible Assets | |||||||||
Total assets | $ | 4,805,405 | $ | 2,365,661 | $ | 2,184,311 | |||
Less: | |||||||||
Goodwill | 246,883 | - | - | ||||||
CDI | 47,499 | - | - | ||||||
Tangible assets | $ | 4,511,023 | $ | 2,365,661 | $ | 2,184,311 | |||
Shares outstanding | 12,159,646 | 8,552,405 | 8,565,491 | ||||||
Book value per common share - GAAP | $ | 64.69 | $ | 33.86 | $ | 32.60 | |||
Tangible book value per common share - non-GAAP | $ | 40.48 | $ | 33.86 | $ | 32.60 | |||
Equity to assets - GAAP | 16.37 | % | 12.24 | % | 12.78 | % | |||
Tangible equity to tangible assets - non-GAAP | 10.91 | % | 12.24 | % | 12.78 | % | |||
SOURCE Esquire Financial Holdings, Inc.
