Lexington, South Carolina, October 21st / PRNewswire / -- First Community Corporation (Nasdaq ticker: FCCO, the holding company of First Community Bank) today announced its financial results for the third quarter of 2026, as well as provided an overview of the business performance and company activities during that period.

Key points for the third quarter of 2026 include:

• The net profit for the third quarter was $8.044 million, a year-on-year increase of 54.9% and a month-on-month increase of 5.9%. After excluding the after-tax impact of merger and acquisition expenses, the net profit was $8.123 million, a year-on-year increase of 44.3% and a month-on-month increase of 1.8%.
• The net profit for the 9-month period ending September 30, 2026, was $21.137 million, representing a 47.0% increase compared to the same period in 2025. After excluding the after-tax impact of merger and acquisition expenses, the net profit for the 9-month period was $22.857 million, showing a year-on-year growth of 52.5%.
• The diluted earnings per share for the third quarter were $0.85, representing a year-over-year increase of 26.9% and a quarter-over-quarter increase of 6.3%. Excluding the after-tax impact of merger and acquisition expenses, the diluted earnings per share for the third quarter were $0.86, showing a year-over-year increase of 19.4% and a quarter-over-quarter increase of 2.4%.
• The diluted earnings per share for the 9 months ending September 30, 2026, were $2.24, representing a 21.1% increase from the same period in 2025. Excluding the after-tax impact of acquisition costs, the diluted earnings per share for the 9 months were $2.42, showing a year-over-year increase of 25.4%.
• Calculated on a tax-equivalent basis, the net interest margin is 3.59%, which represents an expansion of 8 basis points compared to the second quarter of 2026. This is the tenth consecutive quarter of expansion.
• As of September 30, 2026, the total loans amounted to 1.61 billion US dollars, an increase of 32.1 million US dollars this quarter, representing an annualized growth rate of 8.1%. From the beginning of the year to September 30, loan growth amounted to 299.4 million US dollars, of which 195.7 million US dollars were related to the acquisitions of Signature Bank, of, and Georgia. Excluding the impact of the balance on the first day of the acquisition, the organic loan growth for the first nine months of 2026 was 103.7 million US dollars, with an annualized growth rate of 10.6%.
• As of September 30, 2026, shareholders' equity accounted for 9.74% of total assets, which is higher than the 8.14% as of December 31, 2025. Capital ratios, including the ratio of tangible common shareholders' equity to tangible assets ( TCE ) and leverage ratio, have increased to 8.50% and 9.52%, respectively, up from 7.47% and 8.66% as of December 31, 2025.
• Key asset quality indicators continue to be strong: in the third quarter of 2026, net write-offs (including overdrafts) amounted to $9,000; net loan recoveries excluding overdrafts were $5,000; non-performing assets accounted for 0.04%; and overdue loans accounted for 0.27%.
• Investment advisors earned $2.605 million, a year-on-year increase of 39.9% and a month-on-month increase of 14.0%. As of now, the total income for investment advisors has reached $7.162 million, with a year-on-year growth of 32.2%. The managed asset size ( AUM ) as of September 30, 2026, is $1.404 billion, which is higher than $1.378 billion on June 30, 2026, $1.170 billion on December 31, 2025, and $1.103 billion on September 30, 2025.
• The cash dividend for common stock is $0.17 per share, marking the 99th consecutive quarter in which cash dividends have been distributed to common stockholders.

In the third quarter of 2026, the net profit was $8.044 million, with diluted earnings per share amounting to $0.85. In comparison, the net profit and diluted earnings per share for the same period last year were $5.192 million and $0.67 respectively; for the previous quarter, they were $7.595 million and $0.80 respectively. After excluding the impact of merger and acquisition expenses after tax, the net profit was $8.123 million, representing a year-on-year increase of 44.3% and a quarter-on-quarter increase of 1.8%. The diluted earnings per share after excluding the impact of merger and acquisition expenses after tax were $0.86, showing a year-on-year increase of 19.4% and a quarter-on-quarter increase of 2.4%. The company stated that the reported results include the impact of the acquisition of Signature Bank of Georgia completed on January 8, 2026.

For the first nine months ending September 30, 2026, the net profit was $21.137 million, compared to $14.375 million in the same period of 2025. The diluted earnings per share for the first nine months of 2026 were $2.24, an increase from $1.85 in the same period of 2025. After excluding the after-tax impact of merger and acquisition expenses, the net profit for the first nine months was $22.857 million, representing a year-on-year increase of 52.5%. The diluted earnings per share for the first nine months after excluding the after-tax impact of merger and acquisition expenses were $2.42, a year-on-year increase of 25.4%. The company stated that the reported results also include the impact of the acquisitions of Signature Bank, of, and Georgia.

The board of directors has approved a cash dividend of $0.17 per share for the third quarter of 2026. The dividend will be paid on November 17, 2026, to common stockholders registered as of November 3, 2026. First Community Corporation CEO and President Mike Crapps stated: "The entire board is delighted that our performance has enabled the company to continue paying a cash dividend for the 99th consecutive quarter."

The company stated that the bank's various regulatory capital ratios are all above the "capital adequacy" levels required by regulations. As of September 30, 2026, the bank's leverage ratio, tier 1 risk capital ratio, and total risk capital ratio were 9.52%, 13.23%, and 14.37%, respectively, compared to 8.55%, 13.10%, and 14.15% as of September 30, 2025. As of September 30, 2026, the bank's common equity tier 1 capital ratio was 13.23%, which is higher than 13.10% as of September 30, 2025. The company's shareholders' equity as a percentage of total assets was 9.74%, which is higher than 8.14% as of December 31, 2025, and 7.82% as of September 30, 2025. The ratio of the company's tangible common equity shareholders' equity to tangible assets ( TCE ) was 8.50%, which is higher than 7.47% as of December 31, 2025, and 7.15% as of September 30, 2025.

As of September 30, 2026, the book value per share was $24.49, which is higher than $21.78 on December 31, 2025, and $21.01 on September 30, 2025. The tangible book value ( TBV ) increased to $21.09 per share as of September 30, 2026, up from $19.84 on December 31, 2025, and $19.06 on September 30, 2025.

On May 7, 2026, the company announced that it had approved the use of up to $7.5 million in capital to repurchase its common shares, which represents approximately 3.3% of the total shareholders' equity as of September 30, 2026. Under this repurchase plan, the company may repurchase shares from time to time until May 7, 2027. The company stated that no shares were repurchased in the third quarter, but this plan provides an opportunity for future capital management.

The company believes that the quality of its assets remains strong. As of September 30, 2026, non-performing assets ( NPA ) accounted for 0.04% of total assets, amounting to $990,000; whereas as of June 30, 2026, this proportion and amount were 0.04% and $887,000, respectively. The delinquency rate for all loans was 0.27%, which is higher than the 0.26% rate as of June 30, 2026. In the third quarter of 2026, the bank's net write-offs (including overdrafts) amounted to $9,000, and the net recovery of loans excluding overdrafts was $5,000. From the beginning of the year to September 30, 2026, the company's net write-offs (including overdrafts) totaled $35,000, and the net recovery of loans excluding overdrafts was $12,000. As of September 30, 2026, classified loans plus other real estate ( OREO ) accounted for 2.45% of the bank's regulatory risk capital; as of September 30, 2026, subprime loans amounted to $5.9 million, compared to $1.3 million as of December 31, 2025. The credit loss provision for the third quarter of 2026 was $193,000, and as of September 30, 2026, the loan loss provision was $18.703 million, accounting for 1.16% of total loans.

In the third quarter of 2026, total loans increased by $32.1 million to reach $1.61 billion as of September 30, 2026, with a quarter-on-quarter annualized growth rate of 8.1%. Commercial loans issued in the third quarter amounted to $53.3 million, in addition to which there were $17.9 million in withdrawals from unutilized commercial building loans. Some of the loan growth was offset by loan repayments and early repayments during this quarter, with the latter declining by approximately 16.9% compared to the second quarter of 2026.

The loan portfolio yield was 6.08% in the third quarter of 2026, higher than 6.02% in the second quarter. The accounting amortization of the acquired Signature Bank of Georgia loan portfolios resulted in amortization expenses of $143,000 in the third quarter, which caused the loan portfolio yield to decrease by 0.04% for that quarter. In contrast, the amortization expense in the second quarter was $178,000, and in the first quarter it was $437,000, causing the loan portfolio yield to decrease by 0.05% and 0.12% respectively.

As of September 30, 2026, the total deposits amounted to 2.005 billion US dollars, which is lower than the 2.025 billion US dollars as of June 30, 2026. Securities sold under repurchase agreements related to customer cash management accounts or corporate fund collection accounts amounted to 101.5 million US dollars, which is higher than the 96.5 million US dollars as of June 30, 2026. The average balance of total deposits plus securities sold under repurchase agreements remained relatively stable in the third quarter at 2.119 billion US dollars, compared to 2.120 billion US dollars in the second quarter. Net deposits, which are total deposits minus time deposits, were 1.695 billion US dollars, slightly lower than the 1.702 billion US dollars as of June 30, 2026. The average net deposits in the third quarter also remained relatively stable at 1.699 billion US dollars, compared to 1.697 billion US dollars in the second quarter. Interest-free deposits amounted to 534.1 million US dollars, accounting for 26.6% of total deposits, which is higher than the 527.9 million US dollars and 26.1% as of June 30, 2026. As of September 30, 2026, the average balance of customer deposit accounts was 33,893 US dollars, with an average balance of 17,657 US dollars for personal accounts and 72,690 US dollars for non-personal accounts. The company believes that these indicators reflect the diversification and quality of its bank deposit business. The deposit cost in the third quarter remained at 1.76%, unchanged from the second quarter; the funding cost also remained at 1.82%, the same as in the previous quarter.

As of September 30, 2026, the bank's other short-term investments mainly consisted of interest-bearing cash for the Federal Reserve, amounting to $107.5 million, which is lower than the $130.5 million as of June 30, 2026. The portfolio size was $516 million, higher than the $510.8 million at the end of June 2026. The yield in the third quarter rose to 3.36%, compared to 3.33% in the second quarter. As of September 30, 2026, the effective duration of the total portfolio was 3.5 years. The cumulative other comprehensive loss ( AOCL ) as of September 30, 2026, was $22.9 million, up from $18.2 million at June 30, 2026, due to rising market interest rates.

In the third quarter of 2026, net interest income amounted to $20.238 million, which is higher than $19.501 million in the second quarter of 2026 and $15.994 million in the third quarter of 2025. To date, net interest income has reached $58.108 million, exceeding the $45.708 million for the first nine months of 2025. Calculated on a tax-equivalent basis, the net interest margin in the third quarter of 2026 was 3.59%, up from 3.51% in the second quarter and 3.27% in the third quarter of 2025. This tenth consecutive quarter of expanding interest margins is mainly due to improvements in the yield of the loan portfolio, a better structure of interest-generating assets resulting from the growth of the loan portfolio, and the maintenance of stable deposit costs and funding costs. As of September 30, 2026, loans accounted for 71.9% of interest-generating assets, up from 70.7% as of June 30, 2026. The accounting amortization of the acquired Signature Bank of Georgia loan portfolios resulted in amortization expenses of $143,000 in the third quarter, which caused the net interest margin to decline by 0.03% for that quarter. In contrast, amortization expenses were $178,000 in the second quarter and $437,000 in the first quarter, causing the net interest margin to decline by 0.03% and 0.08% respectively. Both deposit costs and funding costs remained at 1.76% and 1.82% on a quarter-on-quarter basis.

In the third quarter of 2026, non-interest income amounted to $5.988 million, representing a growth of 6.2% compared to $5.637 million in the second quarter of 2026 and 34.0% compared to $4.469 million in the third quarter of 2025. This includes a one-time income of $797,000, which came from the settlement of a SBA loan that was written off before the acquisition by First Community by Signature Bank, of, and Georgia. As of September 30, 2026, non-interest income for the year to date has reached $16.415 million, an increase of 29.7% compared to $12.657 million in the first nine months of 2025.

In the third quarter of 2026, the total volume of mortgage loan business amounted to 45.9 million US dollars, which included 23 million US dollars in fixed-rate loans sold on the secondary market, 7.6 million US dollars in adjustable-rate mortgages ( ARM ), and 15.3 million US dollars in construction loans. The total fees income from mortgage loan business in the third quarter was 614,000 US dollars, of which 608,000 US dollars were related to the sale of fixed-rate loans on the secondary market, with a sales yield of 2.65%. In contrast, in the third quarter of 2025, the total volume of this business was 51.6 million US dollars, including 32 million US dollars in fixed-rate loans sold on the secondary market, ARM 4.2 million US dollars, and 15.4 million US dollars in construction loans. In the third quarter of 2025, the fees income related to the sale of fixed-rate loans on the secondary market was 931,000 US dollars, with a sales yield of 2.91%.

In the third quarter of 2026, financial planning and investment advisory services generated revenue of $2.605 million, which is higher than $2.286 million in the second quarter of 2026 and $1.862 million in the third quarter of 2025. The managed asset size ( AUM ) as of September 30, 2026, was $1.404 billion, up from $1.378 billion on June 30, 2026, and $1.103 billion on September 30, 2025.

In the third quarter of 2026, the total fees income from government-guaranteed loan business was $534,000, which is lower than the $704,000 in the second quarter. The volume of this business in the third quarter included loans worth $16.48 million of SBA, compared to $16.14 million in the second quarter. In the third quarter of 2026, the company sold loans worth $5.1 million and received a premium of $426,000, with a sales yield of 8.36%. In contrast, in the second quarter, loans worth $8.94 million were sold, generating a premium of $671,000, with a sales yield of 7.50%.

In the third quarter of 2026, non-interest expenses amounted to $15.63 million, which is higher than $15.273 million in the second quarter. Due to the planned expansion of media spending in the third quarter, marketing and public relations expenses increased by $245,000 compared to the previous quarter. Other expenses increased by $341,000, mainly due to a reversal of $270,000 related to acquisition-related accruals that were disclosed in the second quarter. On a quarter-on-quarter basis, acquisition expenses decreased by $399,000 to $104,000 in the third quarter. In addition, other real estate expenses ($ORE) decreased by $86,000 in the third quarter, resulting in a remaining total of $83,000 for the bank as of September 30, 2026.

About First Community Corporation

The stock of First Community Corporation is traded on the NASDAQ capital market, with the code “FCCO”. The company is a holding firm headquartered in central South Carolina, owned by First Community Bank. First Community Bank is a full-service commercial bank that provides deposit and loan products and services, residential mortgage loans, financial planning/investment advisory services, as well as SBA / USDA loans. First Community serves customers in central South Carolina, the Aiken and Upper State areas, as well as the Piedmont region, and also in Augusta and Atlanta, Georgia. For more information, please visit www.firstcommunitybankers.com.

Forward-looking Statements

This press release and certain statements made by management may contain “forward-looking statements” as defined by the Private Securities Litigation Reform Act of 1995, such as those relating to future plans, objectives, forecasts, and expectations. Therefore, they are forward-looking in nature. Forward-looking statements can be identified by words such as “expected,” “anticipated,” “intended,” “believed,” “possible,” “perhaps,” “will,” “planned,” “targeted,” “future,” “prospective,” and other expressions that indicate future periods. Forward-looking statements are subject to risks, uncertainties, and other factors, and actual results may differ significantly from those anticipated.These risks, uncertainties, and other factors include but are not limited to: (1) The expected cost savings or other benefits from acquiring Signature Bank, of, and Georgia may not be realized; (2) The acquisition may potentially disrupt customer or employee relationships; (3) Competitive pressures among deposit institutions and other financial firms may intensify, affecting pricing, expenses, third-party relationships, and revenue; (4) The overall economy of the United States and the local economy in the regions where the company operates may perform differently than anticipated; (5) Adverse changes in loan delinquency rates, write-off amounts, loan loss provisions, loan growth rates, or the quality of the loan portfolio may lead to increased losses and expenses related to credit risk; (6) Changes in legislation, regulation, policies, or administrative practices, whether from judicial, governmental, or legislative actions; (7) Adverse conditions in the stock market, public debt market, and other capital markets (including changes in interest rates) may continue to have a negative impact on the company; (8) Changes in interest rates have already and may continue to affect the company's deposit and financing costs, net profit, income from early repayments, mortgage banking business income, and other future cash flows, or may affect the market value of assets including investment securities; (9) Technical and network security risks, including potential attacks or business interruptions, reputational risks, and financial losses due to failures in the company's and its suppliers' and other third parties' computer systems; (10) High inflation poses adverse risks to the overall economy and may indirectly pose challenges to customers and the company's business; (11) An increase in FDIC assessment fees, which may continue to rise, thereby increasing operating costs; (12) Events beyond the company's control may have unstable effects on financial markets and the economy, such as pandemics, wars or terrorist activities, disruptions in key utilities, government shutdowns, and a deterioration of the global economy.Unstable credit markets, disruptions in the customer supply chain or transportation; (13) Risks related to the previously announced leadership transition, including the ability to retain key employees, maintain customer relationships, and successfully integrate new executive responsibilities; as well as (14) Risks, uncertainties, and other factors disclosed in the company's recently submitted 10-K annual report, 10-Q quarterly report, or 8-K filing, which can be found on the SEC website.

Although the company believes that the assumptions underlying the forward-looking statements are reasonable, any assumptions may prove to be inaccurate. The company cannot guarantee that the results envisioned in these forward-looking statements will necessarily materialize. The inclusion of such forward-looking information should not be construed as a statement by the company or any individual that the anticipated future events, plans, or expectations will certainly come to pass. Except as required by law, the company has no obligation to publicly update or revise any forward-looking statements due to new information, future events, or other reasons.

The following table adjusts the non-GAAP indicators during the listed period with GAAP.

Some of the financial information mentioned above was calculated using methods other than GAAP. The financial indicators that are not GAAP include 'Tangible Book Value per Share', 'Ratio of Tangible Assets to Shareholders' Equity of Tangible Common Stock', 'Average Return on Tangible Common Equity', 'Earnings Before Tax and Provisions', 'Net Profit After Excluding the After-tax Impact of Acquisition Costs', and 'Diluted Earnings Per Share After Excluding the After-tax Impact of Acquisition Costs'.

“Tangible book value per share” is defined as total equity minus recognized intangible assets, divided by the total number of outstanding common shares.

The ratio of 'tangible common shareholders' equity to tangible assets' is defined as total common equity minus recognized intangible assets, divided by total assets minus recognized intangible assets.

"The average return on tangible common equity" is defined as the annualized net profit divided by the average total equity minus the average recognized intangible assets.

"Pre-tax, pre-provision income" is defined as net interest income plus non-interest income, minus non-interest expenses.

"Net profit after excluding the after-tax impact of acquisition costs" is defined as net profit plus acquisition costs, minus the income tax corresponding to those acquisition costs. In the case of non-GAAP adjustments, deductible acquisition costs are taxed at the company's marginal tax rate of 23.84%, while non-deductible acquisition-related costs are taxed at 0%. The after-tax adjustment represents the combined impact of these two parts.

The "diluted earnings per share after excluding the impact of acquisition costs after tax" is defined as (net profit plus acquisition costs, minus the income tax corresponding to the acquisition costs) divided by the average number of diluted outstanding shares. In the case of non-GAAP adjustments, deductible acquisition costs are taxed at the company's marginal tax rate of 23.84%, while non-deductible acquisition-related costs are taxed at 0%. The post-tax adjustment represents the combined impact of these two parts.

Management believes that these non-GAAP indicators help investors and management to evaluate and compare the company's performance over different periods in a more meaningful way. Non-GAAP indicators have their limitations as analytical tools; investors should not consider them in isolation, nor should they be used as a substitute for analyzing the company's results reported according to GAAP.