First National Q1 Net Income Rises to $4.9M, EPS $0.54 as Deposits Jump 8.4%
First National Corporation reported Q1 net income of $4.9 million and EPS of $0.54, up from $0.18 year-ago, with ROA of 0.98% and ROE of 10.51%. Net loans grew by $14.7 million (4.0% annualized) and deposits rose $37.7 million (8.4% annualized), while NIM reached 3.99%.
1. Q1 Financial Results
First National recorded consolidated net income of $4.9 million in Q1 2026, translating to basic and diluted EPS of $0.54 compared with $0.18 per share in Q1 2025. Return on average assets rose to 0.98% and return on average equity reached 10.51%, exceeding both prior year and prior quarter levels.
2. Balance Sheet Expansion
Net loans increased by $14.7 million for a 4.0% annualized growth rate, fueled by stronger loan production in March. Deposit balances grew by $37.7 million, an 8.4% annualized rise in demand and interest-bearing accounts, while noninterest-bearing deposits comprised 29% of total funding and the tax-equivalent net interest margin improved to 3.99%.
3. Asset Quality and Provisions
The company reduced its provision for credit losses to $450 thousand from $951 thousand in Q4 2025, resulting in net charge-offs of $542 thousand. Non-performing assets declined to 0.21% of total assets and the allowance coverage ratio increased to 331% of non-performing loans.
4. Noninterest Income Trends
Noninterest income fell by $1.2 million to $3.8 million as a one-time $895 thousand recovery from an acquired loan was not repeated. Income from bank-owned life insurance, ATM and check card fees, and brokered mortgage services also saw modest decreases compared with the previous quarter.