Main Street Financial Services Corp. Announces Record Q2 2026 Earnings, Highlighted by 66% Net Income Growth

2026 Second-Quarter Financial Highlights

• Net income increased for the second quarter by 65.7%, totaling $6.1 million, or $0.78 per common share, compared to $3.7 million, or $0.47 per common share, for the second quarter of 2025.
• Return on average tangible common equity (ROATCE) increased 38.3% to 20.04%, compared to 14.49% in the second quarter of 2025.
• Return on average assets (ROA) improved 55 basis points to 1.58%, compared to 1.03% in the second quarter of 2025.
• Deposits increased $24.5 million, or 7.2% annualized, during the second quarter of 2026 and $51.9 million, or 7.9% annualized, for the six months ended June 30, 2026.
• Loans increased $10.9 million, or 3.5% annualized, during the second quarter of 2026 and $63.6 million, or 10.6% annualized, for the six months ended June 30, 2026.
• Efficiency ratio of 49.07% compared to 62.17% for the quarter ended June 30, 2025
• Declared a cash dividend of $0.15 per share on July 10, 2026, following strong quarterly operating results.

Wooster, Ohio, July 23, 2026 – Main Street Financial Services Corp. (OTCQX: MSWV), (the “Company”), the holding company parent of Main Street Bank Corp. reported net income (unaudited) of $6.1 million, or $0.78 per common share, for the three months ended June 30, 2026, an increase of $2.4 million, or 65.7%, when compared to $3.7 million, $0.47 per common share, for the quarter ended June 30, 2025. Return on average assets increased to 1.58% from 1.03% and return on average equity rose to 18.05% from 13.42%. The Company’s efficiency ratio improved to 49.07%, compared to 62.17% in the second quarter of 2025, as revenue growth outpaced expense levels.

"Another record quarter is a testament to what a strong community bank can accomplish when talented employees, loyal customers, and disciplined execution come together," said Mark R. Witmer, Chairman, President, and CEO of Main Street Financial Services Corp. "We continue to invest in our people, deepen customer relationships, and responsibly grow our balance sheet, positioning the company for continued success well beyond this quarter."

Second Quarter 2026 Financial Results

Net interest income was $14.1 million for the quarter ended June 30, 2026, an increase of 13.3% from $12.5 million for the quarter ended June 30, 2025. The net interest margin of 3.85% for the second quarter of 2026 increased 17 basis points from 3.68% for the second quarter of 2025. Loan yields for the quarter ended June 30, 2026, were 6.59%, an increase of 11 basis points compared to the quarter ended June 30, 2025. Excluding purchase accounting accretion, the core loan portfolio generated a yield of approximately 6.53%, reflecting disciplined pricing and favorable portfolio mix. Purchase accounting accretion on acquired loans contributed 6 basis points to overall loan yield during the second quarter of 2026, compared to approximately 23 basis points during the second quarter of 2025. During the second quarter of 2026, $95.2 million of the existing loan portfolio repriced and the bank funded $37.6 million in term loans and extended $13.5 million of lines of credit commitments at current market rates.

Investment yields decreased 13 basis points to 3.89% as of June 30, 2026, compared to the quarter ended June 30, 2025. The decrease was driven by the maturity of higher-yielding securities during the second half of 2025, which impacted overall investment income. The cost of funds for the second quarter of 2026 was 2.47%, a decrease of 6 basis points when compared to the second quarter of 2025. Funding costs reflect increased local deposit growth and reduced reliance on wholesale funding, including FHLB advances. The cost of deposits was 2.43% for the quarter ended June 30, 2026, a 6-basis point increase when compared to 2.37% for the quarter ended June 30, 2025. The cost of borrowings for the quarter ended June 30, 2026, totaled 5.20%, an increase of 77 basis points when compared to the quarter ended June 30, 2025. The increase is due to other borrowings as there were no Federal Home Loan Bank advances in the quarter ended June 30, 2026.

Noninterest income totaled $1.3 million for the quarter ended June 30, 2026, an increase of $349,000, or 38.5%, when compared to the same period in 2025. The increase resulted from management's fee structure review aimed at improving revenue performance.

Noninterest expense totaled $7.5 million for the quarter ended June 30, 2026, a decrease of $767,000, 9.2%, compared to $8.3 million for the same period in 2025. The decrease was driven by a decrease in salaries and employee benefits, legal, and other expenses. These decreases were partially offset by higher franchise taxes and net occupancy and equipment expenses. Overall, the Company maintained disciplined expense management while absorbing higher regulatory and operating costs associated with growth.

Provision for income taxes for the quarter ended June 30, 2026, was $1.6 million, reflecting an effective tax rate of 20.6%.

June 30, 2026, Financial Condition

As of June 30, 2026, the Company had total assets of $1.55 billion with net loan balances totaling $1.27 billion. Loan balances grew by $10.9 million, or 3.5% annualized, during the second quarter of 2026. The increase is primarily attributed to organic growth across the loan portfolios.

The allowance for credit losses increased $91,000, or 2.7% annualized, during the second quarter to $13.8 million at June 30, 2026. The allowance for credit losses as a percentage of total loans was 1.07% for June 30, 2026. The allowance for credit losses and the related provision for credit losses is based on management’s judgment and evaluation of the loan portfolio. Management believes the current allowance for credit losses is adequate, however, changing economic and other conditions may require future adjustments to the allowance for credit losses.

Total liabilities were $1.42 billion at June 30, 2026, with deposits totaling $1.38 billion and wholesale funding totaling $0. Deposits grew by $24.5 million, or 7.2% annualized, during the second quarter of 2026, mainly attributed to growth from Maximize Money Market accounts and the Short-Term Relationship Certificates of Deposits. The Company primarily utilizes FHLB advances as the primary source of wholesale funding due to their accessibility and alignment with prevailing market rates.

Total stockholders’ equity was $138 million at June 30, 2026, an increase of $4.9 million in the second quarter and a $9.2 million increase when compared to December 31, 2025. Total stockholders’ equity increased during the second quarter of 2026 primarily from net income of $6.1 million, an increase in accumulated other comprehensive income of $552,000 and partially offset by dividends of $1.2 million.

Credit Quality

A provision for credit losses and unfunded commitments of $154,000 was recorded for the quarter ended June 30, 2026. The provision increase primarily reflects growth in the loan portfolio during the quarter. Net charge-offs for the quarter ending June 30, 2026 were $59,000, compared to $35,000 as of June 30, 2025.

Total nonperforming loans (NPLs) were $8.5 million at June 30, 2026, an increase of $2.1 million for the quarter. The NPL to average loan receivable ratio was 0.67% as of June 30, 2026. Past due loan balances of 30 days and more decreased from $11.5 million at March 31, 2026, to $9.6 million, or 0.76% of net loans outstanding, at June 30, 2026.

Main Street Financial Services Corp. is a holding company headquartered in Wooster, Ohio. Its primary subsidiary, Main Street Bank Corp. was founded in 1899 and provides full-service banking, commercial lending, and mortgage services across its branch infrastructure. Today, Main Street Bank Corp. operates twenty branch locations in Wooster, Ohio, Wheeling, West Virginia and other surrounding communities in Ohio and West Virginia. Additional information about Main Street Bank Corp. is available at www.mymainstreetbank.bank.

Non-GAAP Disclosure

This press release includes disclosures of the Company’s return on average equity, return on average assets, net income, and efficiency ratios which exclude amounts the Company views as unrelated to its normalized operations, including securities gains/losses, acquisition costs, restructuring costs, legal settlements, and system conversion costs. The financial measures are not prepared in accordance with generally accepted accounting principles in the United States (GAAP). A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flow that excludes or includes amounts that are required to be disclosed by GAAP. The Company believes that these non-GAAP financial measures provide both management and investors a more complete understanding of the underlying operational results and trends and the Company’s marketplace performance. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the numbers prepared in accordance with GAAP.

Forward-Looking-Statements
This release contains forward-looking statements that are not historical facts and that are intended to be “forward-looking statements” as that term is defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements may include, but are not limited to, statements about the Company’s plans, objectives, expectations and intentions and other statements contained in this release that are not historical facts and pertain to the Company’s future operating results. When used in this release, the words “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates” and similar expressions are generally intended to identify forward-looking statements. Actual results may differ materially from the results discussed in these forward-looking statements, because such statements are inherently subject to significant assumptions, risks, and uncertainties, many of which are difficult to predict and are generally beyond the Company’s control. These include but are not limited to: the possibility of adverse economic developments that may, among other things, increase default and delinquency risks in the Company’s loan portfolios; shifts in interest rates; shifts in the rate of inflation; shifts in the demand for the Company’s loan and other products; unforeseen increases in costs and expenses; lower-than-expected revenue or cost savings in connection with acquisitions; changes in accounting policies; changes in the monetary and fiscal policies of the federal government; and changes in laws, regulations and the competitive environment.  Unless legally required, the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact Information:

Matthew Hartzler
Executive Vice President, Chief Financial Officer
(330) 264-5767