Timberland Bancorp (TSBK) Financials

Timberland Bancorp’s latest quarter showed continued earnings growth, although results remained below the recent peak reached in the first quarter of fiscal 2026. For Q3 2026, net income increased to $7.7 million from $7.1 million in the year-ago quarter and $7.1 million in Q2. Basic earnings per share rose to $0.99, compared with $0.90 in Q3 2025 and $0.91 in Q2.

The longer-term trend is favorable. Net interest income increased from $16.0 million in Q1 2024 to $18.8 million in Q3 2026, while total assets grew from $1.90 billion to $2.06 billion. Shareholders’ equity also expanded from $237.4 million to $273.2 million over that period, supported by retained earnings despite ongoing share repurchases and dividends.

• Net interest income continues to improve: Q3 2026 net interest income rose 6.7% year over year to $18.8 million, reflecting growth in loan-related interest income and a stronger earning-asset base.
• Earnings and EPS are above year-ago levels: Net income grew 8.7% from Q3 2025, and basic EPS increased 10% to $0.99. The lower share count from repurchases helped support per-share results.
• Core revenue is expanding: Total revenue increased to $21.8 million from $20.5 million in the comparable quarter and has generally trended upward from the $18.8 million reported in Q1 2024.
• Deposits and the balance sheet have grown: Total deposits reached approximately $1.76 billion in Q3 2026, up from $1.67 billion a year earlier. Total assets increased 5.3% year over year to $2.06 billion.
• Capital strength has improved: Total common equity rose to $273.2 million from $256.7 million in Q3 2025. Long-term debt also declined to $10 million from $20 million in Q2 and Q3 2025.
• Operating cash flow remains positive: Timberland generated $8.4 million of operating cash flow in Q3 2026. Operating cash flow has remained positive in each of the reported quarters, despite fluctuations caused by working-capital changes.
• Shareholder returns continue: The company repurchased $2.9 million of common stock and paid $2.3 million of dividends during Q3 2026, although the income statement data reports zero cash dividends per share and should be reconciled with future filings.
• Liquidity has shifted toward interest-bearing assets: Cash and due from banks increased to $32.8 million, while interest-bearing deposits at other banks declined sequentially to $213.3 million. The combined liquidity position remains substantial, but the mix can affect future interest income.
• Cash declined sharply during the quarter: Net cash decreased by $48.6 million in Q3 2026, primarily because the company purchased $54.5 million of investment securities and recorded $62.3 million of net investing cash outflows.
• Credit-loss provisions and expenses remain elevated: The provision for credit losses increased to $600,000 from $444,000 a year earlier. Non-interest expense also rose 4.2% year over year to $11.6 million, limiting the benefit from higher revenue.

Overall, Timberland Bancorp’s statements show a profitable and growing institution with improving net interest income, deposits, assets and capital. However, quarterly earnings have been uneven—net income fell from $8.2 million in Q1 2026 to $7.1 million in Q2 before recovering in Q3—and the latest quarter consumed significant cash through investment-security purchases. Investors should monitor credit-loss provisions, deposit costs and whether the company can sustain earnings growth without relying on favorable interest-rate or investment-market conditions.