Stock Yards Bancorp reported record third-quarter earnings, with net income rising to $43.5 million, or $1.40 per diluted share. The Louisville-based bank said higher net interest income and record fee income helped drive the result, while loan payoffs continued to restrain growth.
The quarter was also the first full period to include the contribution from its merger with Field & Main Bancorp. Stock Yards completed the core systems conversion in mid-October and said it plans to manage its assets below $10 billion at year-end as it prepares to cross that regulatory threshold in 2027.
Key details
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Earnings increased from both comparison periods. Third-quarter net income was $43.5 million, up from $40.1 million in the second quarter of 2026 and $36.2 million in the third quarter of 2025. Diluted earnings per share were $1.40, compared with $1.31 and $1.23, respectively.
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Net interest income and margin expanded. Net interest income rose to $92.6 million from $87.8 million in the prior quarter and $77.0 million a year earlier. Net interest margin was 3.88%, up from 3.84% in the second quarter and 3.56% a year ago.
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Fee income reached a record. Non-interest income totaled $27.6 million, compared with $26.7 million in the prior quarter and $24.5 million a year earlier. Wealth management and trust revenue, treasury management fees and brokerage income each set records; card income also contributed to results.
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Loan growth was positive but below management’s expectations. Elevated loan payoffs continued to offset solid loan production. The company said its pipeline remained steady heading into the fourth quarter, while noting that payoffs are expected to remain a near-term headwind.
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Expenses rose year over year. Non-interest expenses were $64.1 million, up from $63.8 million in the second quarter and $53.8 million a year earlier. The efficiency ratio improved to 53.29% from 55.64% sequentially, but was slightly higher than the 52.99% reported a year ago.
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Credit costs were lower than a year earlier. Stock Yards recorded a $950,000 provision for credit losses, compared with no provision in the second quarter and $2.0 million in the third quarter of 2025. Management cited strong credit quality but did not provide additional credit metrics in the earnings announcement.
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The Field & Main merger is contributing to results. The third quarter was the first full quarter reflecting the acquisition. Stock Yards completed the core systems conversion in mid-October, an important integration step, though management said further integration work remains.
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The company is managing around the $10 billion asset threshold. Total assets remained above $10 billion at Sept. 30. Management said it remains committed to keeping the balance sheet below that level at year-end as it prepares for an official transition across the threshold in 2027.
Plain-English implications
The quarter’s earnings growth came alongside a wider net interest margin and stronger fee income, while loan payoffs limited balance-sheet growth. The merger is already contributing to reported results, and the systems conversion marks a significant integration milestone. Stock Yards’ plan to manage assets below $10 billion at year-end makes its balance-sheet size part of its transition planning into 2027.