Northpointe Bancshares (NYSE:NPB) released first-quarter financial results and hosted an earnings call on Wednesday. Read the complete transcript below.
This content is powered by Benzinga APIs. For comprehensive financial data and transcripts, visit https://www.benzinga.com/apis/.
Access the full call at https://event.choruscall.com/mediaframe/webcast.html?webcastid=PRc9lWLG
Summary
Northpointe Bancshares reported earnings of $0.62 per diluted share, with a return on average assets of 1.28% and a return on average tangible common equity of 15.71%.
The company achieved robust growth in its Mortgage Purchase Program (MPP), with balances ending the quarter at $3.9 billion, a 51% annualized growth over the prior period.
The company reaffirmed its guidance for 2026, expecting MPP balances to increase to between $4.1 and $4.3 billion by year-end.
Asset quality improved, with net charge-offs declining significantly and non-performing assets decreasing by $2.0 million from the prior quarter.
The company’s strategic focus remains on expanding its MPP business, optimizing capital ratios, and leveraging digital banking channels to drive deposit growth.
Full Transcript
OPERATOR
Greetings. Welcome to NorthPoint Bank Shares Incorporated First Quarter 2026 Earnings Call. All participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press Star 0 on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to Brad Howes, Executive Vice President and Chief Financial Officer. Thank you. You may begin.
Brad Howes (Executive Vice President and Chief Financial Officer)
Good morning and welcome to Northpointe Bancshares’ first quarter 2026 earnings call. My name is Brad Howes and I am the Chief Financial Officer. With me today are Chuck Williams, our Chairman and CEO, and Kevin Comps, our President. Additional earnings materials, including the presentation slides that we will refer to on today’s call are available on Northpointe Bancshares’ investor relations website, ir.northpointe.com As a reminder, during today’s call we may make forward looking statements which are subject to risks and uncertainties and are intended to be covered by the safe harbor provisions of federal securities law. For a list of factors that may cause actual results to differ materially from expectations, please refer to the disclosures contained within our SEC filings. We will also reference non-GAAP financial measures and encourage you to review the non-GAAP reconciliations provided in both our earnings release and presentation slides. The agenda for today’s call will include prepared remarks followed by a question and answer session. With that, I’ll turn the call over to Chuck.
Chuck Williams (Chairman and CEO)
Thank you, Brad. Good morning everyone and thank you for joining. With the first quarter completed, we’re off to a very good start in 2026. Despite the macroeconomic uncertainty, our business model remains resilient and our exceptional team members continue to perform well. For the quarter, we earned $0.62 per diluted share on and with a return on average assets of 1.28% and a return on average tangible common equity of 15.71%. Factoring in the impact of dividends paid, our tangible book value per share increased by over 16% annualized over the prior period. Our first quarter results were anchored by robust growth and continued market share gains in our mortgage purchase program or mortgage purchase program (MPP) business, strong performance in our residential lending channel, a modest reduction in our wholesale funding ratio and an improvement in overall asset quality. We’ve added a new slide which is on page four of our earnings call presentation which I think really tells the story well. We’re proud to be one of the only entirely mortgage focused banks in the country. While certain aspects of our financial performance are naturally sensitive to mortgage rates, our diversification across the mortgage Space has historically insulated us from dramatic income statement volatility typically associated with the mortgage industry. As outlined in the charts, we’ve continued to deliver consistent financial performance and grow tangible book value despite a challenging and volatile interest rate environment. One of the biggest drivers of our performance is the success we’ve achieved in our mortgage purchase program (MPP) business. Let me walk through a few highlights. mortgage purchase program (MPP) balances ended the quarter at 3.9 billion, an impressive growth rate of 51% annualized over the prior period. Total loans funded through the channel was 11.2 billion for the quarter, which is very strong considering the first quarter is typically slower due to normal seasonality in the mortgage business. By comparison, total loans funded was 6.7 billion for the first quarter of 2025. We have funded 4.6 billion in total loans during March, which is our highest volume month on record. I believe our first quarter results combined with the momentum we have gained set us up nicely to meet or exceed our 2026 growth plan. I’d like to now turn the call over to Kevin to provide more details on our business lines.
Kevin Comps (President)
Thanks Chuck Good morning everyone. Let’s start with our MPP business on slide 6. Compared to the prior quarter period, ending MPP balances increased by 435.7 million and average balances increased by 59.3 million, with most of the balance growth occurring towards the end of the quarter. As I’ve discussed on prior calls, these are net of any MPP balances participated up at March 31, 2026. We had participated $412.7 million to our partner banks, down slightly from the level at December 31, 2025. Let me break down our first quarter 2026 growth a bit further. First, we brought in 8 new clients which totaled 205 million in additional capacity. Second, we increased facility size for 11 existing clients which totaled 465 million in additional capacity. And third, the overall utilization of our existing clients remained strong during the quarter averaging 57%. Average MPP yields were 6.59% and fee adjusted yields were 6.82%. During the first quarter of 2026. Our average yield was down 39 basis points from the prior quarter, which is consistent with the decrease in Secured Overnight Financing Rate (SOFR) over that same time period. Turning now to retail banking on Slide 7, I’d like to highlight the results of the 3 main businesses within that segment. Starting with residential lending, which includes both our traditional retail and our consumer direct channels. We closed 693.7 million in mortgages during the first quarter, which is down from 762.0 million in the prior quarter. During the first quarter of 2026, saleable volume was 626.6 million. Of that, 39% was in the consumer direct channel and 61% was in the traditional retail channel. This compares to 671.3 million in saleable volume during the fourth quarter of 2025, with 35% of the volume in the consumer direct channel and 65% in the traditional retail channel. Refinance activity made up 59% of the total salable volume in the first quarter of 2026, up from 51% in the fourth quarter of 2025. In both periods we saw a drop in mortgage rates which spurred additional refinance activity. As we discussed previously, it only takes a 25 to 50 basis point decline in mortgage rates to drive additional refinance activity and we were able to take advantage of that temporary drop in both of the last two quarters. The additional refinance activity helped maintain strong volumes and revenues in what is typically a slower buying season. Mortgage rate lock Commitments increased by 12% over the prior quarter driven by an increase in refinance activity, with purchase activity down modestly from the prior quarter. We sold approximately 68% of the saleable mortgages service released in the first quarter of 2026, which is down from 79% in the prior quarter. We continue to look for opportunities to create additional efficiencies using technology and hire new talented lenders within the channel. During the first quarter we hired seven new mortgage professionals in two new markets to help us continue to grow the channel. In the middle of slide 7 we highlight our digital deposit banking channel where we feature our direct customer platform and competitive product suite. We ended the fourth quarter with 5.0 billion in total deposits, an increase from the prior quarter. The breakout of these deposits is detailed in the Appendix on slide 13. The majority of our deposit growth when compared to the prior quarter was driven by normal seasonality in our custodial deposit balances as well as higher levels of brokered network deposits which had more attractive rates than brokered CDs. On the right side of slide 7, we highlight our specialty mortgage servicing channel where we focus on servicing first lien home equity lines tied seamlessly to demand deposit sweep accounts, including what we commonly refer to as All-in-One (AIO) loans. Excluding the adjustment for the change in fair value of MSRs. We earned 2.2 million in loan servicing fees for Q1, which is flat from the prior quarter, including loans we outsourced to a subservicer we serviced 15,900 loans for others with a total UPB of 5.2 billion as of the first quarter of 2026. Turning lastly to slide 8, we saw a nice improvement in our overall asset quality metrics during the quarter. Consistent with prior quarters, we are not seeing any systemic credit quality or borrower issues in any of our portfolios. We had net charge offs …
This post was originally published here
