Provident Financial Services reported lower third-quarter earnings than in the prior quarter and a year earlier, while its adjusted measures of underlying profitability improved. Results included a $17.5 million one-time charge tied to debt extinguishment, along with costs for a completed technology conversion and branch restructuring.
The bank also reported higher revenue and year-over-year growth in deposits. For the first nine months of 2026, net income was ahead of the same period last year.
Key details
- Third-quarter net income was $69.2 million, or 53 cents per share. That compared with $78.1 million, or 60 cents per share, in the second quarter and $71.7 million, or 55 cents per share, in the third quarter of 2025.
- The quarter included several identified expenses: a $17.5 million loss from extinguishing debt, $3.7 million in costs related to the company’s core systems conversion and $465,000 in branch restructuring expenses.
- Excluding those items, core net income was $84.3 million, or 65 cents per share, for the quarter. For the first nine months, core net income was $243.5 million, or $1.87 per share. These adjusted figures are the company’s measure of results excluding the listed expenses.
- Nine-month reported net income rose to $226.7 million, or $1.74 per share, from $207.7 million, or $1.59 per share, in the first nine months of 2025.
- Core pre-provision net revenue (PPNR) reached $119.5 million, or 92 cents per share, up from $108.7 million, or 83 cents per share, in the year-earlier quarter. PPNR measures revenue less operating expenses before credit-loss provisions.
- Profitability and margin measures improved year over year. Annualized core return on average assets was 1.30%, versus 1.16% a year earlier. Net interest margin was 3.50%, compared with 3.43%; the company’s core net interest margin, which excludes certain purchase-accounting effects and interest recoveries, was 3.16%, up 22 basis points from a year earlier and 7 basis points from the prior quarter.
- The company said revenue reached a record and core deposits grew at an annualized rate of nearly 6%. It also said it completed its previously announced core systems conversion during the quarter and kept its adjusted efficiency ratio below 50%.
- Annualized returns for the quarter were 1.07% on average assets, 9.39% on average equity and 13.80% on average tangible equity.
What changes for investors
The systems conversion is complete, though the quarter still included related costs. The main distinction in the results is between reported earnings, which absorbed the debt and other specified charges, and the higher core earnings figure that excludes them. The company also reported improving core margins and year-over-year PPNR growth alongside deposit growth.