Earnings

First Guaranty Turns a Third-Quarter Loss Into Profit

The Tip Desk · November 12, 2026 · 3 min read

Net income was $12.0 million, or $0.69 a share, after an estimated $17.6 million net pre-tax contribution from selling Texas operations.

First Guaranty Bancshares (FGBI), the Louisiana community-bank holding company, reported net income of $12.0 million for the three months ended September 30, 2026, or $0.69 a share, after a $45.0 million loss, or $3.01 a share, a year earlier. Income available to common shareholders was $11.37 million.

The Louisiana community-bank holding company said third-quarter results were impacted by the sale of First Guaranty Bank’s Texas operations and by strategic changes after an FDIC and OFI consent order effective August 7, 2026.

On July 31, 2026, the bank completed the sale of its Texas operations to Armstrong Bank of Muskogee, Oklahoma, including five branches, about $234 million of deposits and $88 million of loans. The transaction included a 7.65% deposit premium of $17.9 million, a $2.1 million gain on related real estate, $1.9 million of legal and professional fees, a $0.7 million write-off of remaining core deposit acquisition intangibles and $0.1 million of one-time severance. Loans were sold at par. First Guaranty estimated the Texas sale contributed about $17.6 million to pre-tax income.

Net interest income was $17.65 million, down from $22.24 million a year earlier, as loan interest income fell to $27.42 million from $39.33 million and total interest expense declined to $26.22 million from $31.26 million. Provision for credit losses was $3.75 million, versus $47.93 million a year earlier, lifting net interest income after provision to $13.90 million from a $25.70 million loss. Return on average assets was 1.36% and return on average common equity was 22.74%.

Total noninterest income was $19.82 million, versus $1.86 million a year earlier, driven by $16.14 million of net gains on sale of branches from the Texas operations sale. Total noninterest expense was $18.86 million, versus $30.18 million a year earlier, including $12.90 million of goodwill impairment in the year-ago quarter and $7.03 million of salaries and employee benefits.

Chief Executive Officer Michael R. Mineer said the quarter marked another step in strengthening the company’s financial position. The bank also continued to reduce higher-cost funding sources.

To comply with the consent order, which includes reducing excess leverage to meet a 9.0% Tier 1 leverage ratio requirement and reducing classified and non-performing assets, the bank paid off $135.0 million of FHLB advances early, incurring a $0.5 million pre-payment penalty. It used the One-Way sell feature of reciprocal deposits to reduce surplus cash and deposits by $291.4 million as of September 30, 2026, and redeemed $130.6 million of brokered deposits. Long-term FHLB advances were zero at quarter-end, versus $135.0 million a year earlier.

Substandard assets declined by $31.2 million in the third quarter. The bank signed a sales agreement for its largest OREO property of $22.6 million, written down $0.7 million in the quarter, and a letter of intent to sell its second-largest non-performing loan of $11.4 million. Both transactions are expected to close in the fourth quarter. Other real estate, net, was $28.0 million at September 30, 2026, versus $12.1 million a year earlier.

The bank’s Tier 1 leverage ratio improved to 8.29% and total risk-based capital increased to 18.79% after the Texas sale and higher-cost funding reductions. Mineer said work remains, and that actions taken throughout 2026 have strengthened the balance sheet and reduced risk.

Total assets were $3.15 billion at September 30, 2026, versus $3.80 billion a year earlier. Loans net of unearned income were $1.58 billion, and total deposits were $2.85 billion.

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