Timberland Bancorp reported higher earnings for fiscal 2026 and a stronger fourth quarter than the preceding three months, as its net interest margin widened and loan balances grew. The Hoquiam, Washington-based bank holding company also raised its quarterly dividend by 3% and repurchased shares during the quarter.
The results show a mixed comparison with the year-earlier quarter: reported earnings were lower, but that period included a $1.04 million benefit from a bank-owned life insurance claim. Timberland also made a fourth-quarter investor presentation available.
Key details
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Full-year earnings increased. Net income for the fiscal year ended September 30, 2026, rose 7% to $31.17 million from $29.16 million a year earlier. Diluted earnings per share climbed 8% to $3.96 from $3.67, a record annual result for the company.
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Fourth-quarter earnings rose from the prior quarter. Net income was $8.11 million, or $1.04 per diluted share, compared with $7.72 million, or 98 cents per share, in the June quarter. That represents increases of about 5% in net income and 6% in earnings per share.
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Year-over-year quarterly results were lower on a reported basis. Net income declined from $8.45 million to $8.11 million, while earnings per share fell from $1.07 to $1.04. The year-earlier quarter included a $1.04 million bank-owned life insurance claim benefit, which lifted its results.
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Net interest margin expanded. The fourth-quarter margin was 3.96%, up 11 basis points from the preceding quarter and 14 basis points from the year-earlier quarter. Timberland attributed the improvement to its pricing approach on both loans and deposits.
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Loans grew, and credit indicators were described as steady to modestly improved. Net loans increased 2% from the prior quarter. Non-performing assets, delinquencies and substandard loans improved modestly, according to the company. Net charge-offs increased, largely because Timberland charged off loans against specific reserves established in earlier periods.
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The company reported stronger quarterly returns. Return on average assets was 1.56%, and return on average equity was 11.72%.
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Timberland increased its dividend and continued repurchasing shares. The quarterly cash dividend rose 3% to 31 cents per share, the company’s 56th consecutive quarterly dividend. It is payable November 27 to shareholders of record November 12. Timberland also repurchased 40,395 shares during the quarter and reported tangible book value per share of $33.54.
Plain-English implications
The quarter’s improvement in earnings, margin and loan growth came alongside a higher dividend and share repurchases. Timberland’s year-over-year quarterly comparison is weighed down by the prior-year insurance benefit, while its full-year results show growth in both net income and earnings per share.