Amalgamated Financial NASDAQ: AMAL reported what executives described as a record second quarter of 2026, with management citing balance sheet growth, deposit strength and improved operating leverage as key drivers of higher profitability.
President and Chief Executive Officer Priscilla Sims Brown said the quarter “showcases the power of the franchise” the company has built, pointing to record net income of $34.8 million and core net income of $33.1 million. She said return on average assets exceeded 1.4%, return on tangible common equity topped 16% and the company’s core efficiency ratio remained below 50%.
Revenue approached $100 million in the quarter, while revenue per share exceeded $3 for the second consecutive quarter, according to Sims Brown. She said the results supported Amalgamated’s decision to raise its full-year 2026 guidance.
Deposits Reach Record Level
Management emphasized the company’s deposit franchise as a defining strength in the quarter. Sims Brown said on-balance sheet deposits increased by $280 million, or 3.4%, to a record $8.5 billion.
The increase included approximately $212 million of growth in political deposits, which rose to $2.1 billion. Labor deposits increased by $30 million, while social and philanthropy deposits rose by $55 million. Off-balance sheet deposits were more than $1 billion.
Sims Brown said the company’s deposit-led growth strategy gives the bank flexibility to shape its balance sheet and redeploy liquidity into higher-yielding assets, including loans, PACE assessments and securities.
Loan Growth and Asset Repositioning Support Earnings
Total loans increased by approximately $115 million during the quarter, while loans in “growth mode” commercial lending rose by approximately $155 million, or 4.5%, Sims Brown said.
Chief Financial Officer Jason Darby said the quarter demonstrated that deposit-led balance sheet expansion is translating into earnings growth through asset optimization. He said Amalgamated added $276 million in commercial loans, PACE assessments and traditional securities at attractive yields, while non-growth loan portfolios generated about $39 million of cash through planned runoff.
During the question-and-answer portion of the call, Chief Banking Officer Sam Brown said the company was “really proud” of the loan growth in the quarter, particularly the $155 million in commercial production. He said the bank was positive across its asset classes and was able to redeploy runoff from lower-yielding assets into a more optimized mix.
Darby added that Amalgamated continues to expect quarterly net loan growth near the high end of its previously stated 1.5% to 2% sequential range, saying the company expects to be closer to 2% in the third and fourth quarters.
Guidance Raised for Net Interest Income and Core Earnings
Darby said Amalgamated is increasing its full-year 2026 net interest income outlook from a prior high-end target of $333 million to a new range of $338 million to $340 million. The company also raised its core pre-tax, pre-provision earnings outlook from a prior high-end target of $185 million to a new range of $188 million to $190 million.
“These are meaningful increases that reflect our confidence in the bank, the momentum we’re seeing across the balance sheet, and our ability to convert growth into earnings and sustainable shareholder value appreciation,” Darby said.
Darby said net interest margin benefited in the quarter from the speed at which the bank deployed asset growth. He said some margin and net interest income were pulled forward into the quarter but should remain with the company through the year. He said margin should moderate in the back half of 2026, with possible modest compression in the fourth quarter due to deposit mix shifts related to political deposit outflows.
Darby said the company is targeting $9.6 billion of assets, funded through excess liquidity that would typically reside off balance sheet. He said Amalgamated expects to reach that target early in the third quarter. By year-end, he said, the company’s goal is to have off-balance sheet deposits near zero and little to no debt or leverage, depending on the timing of political deposit outflows.
Credit Stable; Expenses Expected to Rise
Darby said overall credit performance was stable in the quarter. Provision expense normalized after reserve actions taken in the prior quarter, criticized classified balances declined by approximately $9 million and pass-rated loans represented about 97% of the total portfolio.
He said the bank remains actively engaged in managing a previously discussed multifamily relationship and continues to believe its reserve position appropriately reflects current conditions and risk assessments.
On expenses, Darby said Amalgamated expects costs to rise in the third and fourth quarters, with approximately $49 million of expenses in each period as a benchmark. He said that would push total expense guidance from the previously discussed $188 million to around $190 million.
Darby said third-quarter expense growth will include planned costs tied to the company’s move from its existing headquarters into a new facility. In the fourth quarter, he said those costs will not recur, but the company expects layered expenses related to technology infrastructure, back-office risk and compliance, and compensation.
Sims Brown said Amalgamated remains focused on investing in its future while maintaining operating discipline. She said investments in technology, modernization, talent and infrastructure are intended to support scalability and efficiency over time.
Management Highlights Technology and Clean Energy Opportunities
Executives also pointed to technology investment as part of the company’s long-term strategy. Sims Brown said Amalgamated is expanding its use of AI-enabled tools and building technology infrastructure to support efficient and scalable growth. Darby said the bank plans to update investors in future quarters on AI adoption, utilization and “agentification” as it works toward scalable efficiency.
Asked about clean energy demand, Sam Brown said demand continues to increase and that Amalgamated’s role in financing that demand remains strong. He cited a Deloitte study that estimated a need for 30 to 66 gigawatts of renewable power generation by 2030 and said the broader need is estimated at about 225 gigawatts, excluding capacity already identified for retirement.
Brown said renewables and storage maintain a cost advantage over gas and that the country cannot meet demand without multiple energy sources. He said Amalgamated will remain careful in selecting assets, focusing on long-term contracted revenues, investment-grade counterparties and fixed-rate amortizing debt.
In closing remarks, Sims Brown said the company is “exceptionally well-positioned,” citing its balance sheet, deposit franchise, improving profitability and strategy for scaling through investments in people, technology and AI-enabled capabilities.
About Amalgamated Financial (NASDAQ:AMAL)
Amalgamated Financial Corp. NASDAQ: AMAL is the bank holding company for Amalgamated Bank, a fully insured commercial bank with a historic mission of serving labor unions, progressive non-profits and mission-driven organizations. Founded in 1923 by the Amalgamated Clothing Workers of America, Amalgamated Bank has grown into a national institution offering a broad suite of banking services, including deposit accounts, commercial and consumer lending, cash management, and treasury solutions tailored to organizations with social responsibility or union affiliations.
In addition to core banking, Amalgamated Financial provides wealth management and trust services, retirement plan consulting and impact investing strategies.
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