Union Bankshares' Net Income Soars 160% on Strong Interest Income

TL;DR

**UNB crushed it this quarter, net income up 160% — definitely one to watch for continued growth.**

AI Summary

UNION BANKSHARES INC reported a significant increase in net income for the three months ended September 30, 2025, reaching $3.436 million, up 159.5% from $1.324 million in the same period of 2024. Basic earnings per common share also surged to $0.75 from $0.29 year-over-year. For the nine months ended September 30, 2025, net income rose to $8.332 million, a 44.7% increase from $5.760 million in 2024. This growth was primarily driven by a 18.3% increase in total interest and dividend income to $19.207 million for the quarter, and a 18.2% increase to $56.223 million for the nine-month period. Net interest income after credit loss expense increased by 20.4% to $10.843 million for the quarter. Total assets grew by 3.0% to $1.573 billion as of September 30, 2025, from $1.528 billion at December 31, 2024, largely due to an increase in loans to $1.174 billion from $1.155 billion. The company also saw a substantial increase in total noninterest income, which more than doubled to $3.350 million for the quarter, primarily due to net gains on sales of loans held for sale and the absence of net losses on sales of investment securities available-for-sale, which were $1.293 million in Q3 2024.

Why It Matters

This strong performance by UNION BANKSHARES INC indicates robust operational efficiency and effective asset management, which is crucial for investor confidence in the regional banking sector. The significant increase in net income and EPS suggests a healthy return on investment for shareholders, potentially making UNB an attractive option in a competitive market. For employees, this financial stability could translate into job security and growth opportunities. Customers may benefit from a more stable and expanding bank, potentially leading to better services and lending products. In the broader market, UNB's growth could signal positive trends for other smaller reporting companies, especially given the current economic climate.

Risk Assessment

Risk Level: medium — While net income is up significantly, the company still holds substantial gross unrealized losses on investment securities available-for-sale, totaling $35.520 million as of September 30, 2025. This represents a potential future risk if these securities need to be sold, despite a decrease from $43.583 million at December 31, 2024. Additionally, the allowance for credit losses on loans increased to $8.397 million from $7.680 million, indicating a slight uptick in perceived credit risk.

Analyst Insight

Investors should consider UNB's strong earnings growth and increased net interest income as a positive indicator. However, they should also monitor the unrealized losses on investment securities and the rising allowance for credit losses. A deeper dive into the loan portfolio quality and interest rate sensitivity would be prudent to assess long-term sustainability.

Financial Highlights

debt To Equity

19.26

revenue

$31.872M

operating Margin

N/A

total Assets

$1.573B

total Debt

$287.140M

net Income

$3.436M

eps

$0.75

gross Margin

N/A

cash Position

$35.473M

revenue Growth

+14.1%

Revenue Breakdown

Key Numbers

• $3.436M — Net Income (Q3 2025) (Increased 159.5% from $1.324M in Q3 2024)
• $0.75 — Basic EPS (Q3 2025) (Increased from $0.29 in Q3 2024)
• $19.207M — Total Interest & Dividend Income (Q3 2025) (Increased 18.3% from Q3 2024)
• $11.156M — Net Interest Income (Q3 2025) (Increased 18.3% from $9.430M in Q3 2024)
• $3.350M — Total Noninterest Income (Q3 2025) (Increased 108.7% from $1.605M in Q3 2024)
• $1.573B — Total Assets (Sept 30, 2025) (Increased 3.0% from $1.528B at Dec 31, 2024)
• $1.174B — Loans (Sept 30, 2025) (Increased from $1.155B at Dec 31, 2024)
• $35.520M — Gross Unrealized Losses on AFS Securities (Sept 30, 2025) (Decreased from $43.583M at Dec 31, 2024)
• $8.397M — Allowance for Credit Losses on Loans (Sept 30, 2025) (Increased from $7.680M at Dec 31, 2024)
• 4,582,423 — Common Shares Outstanding (Oct 24, 2025) (Increased from 4,538,009 at Dec 31, 2024)

Key Players & Entities

• UNION BANKSHARES INC (company) — Registrant
• $3.436 million (dollar_amount) — Net income for Q3 2025
• $1.324 million (dollar_amount) — Net income for Q3 2024
• $8.332 million (dollar_amount) — Net income for nine months ended Sept 30, 2025
• $5.760 million (dollar_amount) — Net income for nine months ended Sept 30, 2024
• $19.207 million (dollar_amount) — Total interest and dividend income for Q3 2025
• $56.223 million (dollar_amount) — Total interest and dividend income for nine months ended Sept 30, 2025
• $1.573 billion (dollar_amount) — Total assets as of Sept 30, 2025
• $1.174 billion (dollar_amount) — Total loans as of Sept 30, 2025
• $35.520 million (dollar_amount) — Gross unrealized losses on AFS securities as of Sept 30, 2025

FAQ

Risk Factors

• Credit Risk [high — financial]: The company's primary financial risk stems from its loan portfolio. As of September 30, 2025, the allowance for credit losses on loans was $8.397 million, an increase from $7.680 million at December 31, 2024. While the allowance has increased, a significant deterioration in loan quality or economic downturn could lead to higher-than-anticipated credit losses.
• Interest Rate Sensitivity [medium — market]: Fluctuations in interest rates can impact net interest income. The company's net interest income increased by 20.4% to $10.843 million for the quarter, suggesting a favorable interest rate environment or effective asset-liability management. However, adverse rate movements could compress margins.
• Investment Portfolio Valuation [medium — market]: The company holds $260.404 million in investment securities available-for-sale as of September 30, 2025. Unrealized losses on these securities, while decreasing to $35.520 million from $43.583 million at year-end, can impact accumulated other comprehensive income and potentially require recognition of losses if sold.
• Operational and Cybersecurity Risks [medium — operational]: Like all financial institutions, Union Bankshares is exposed to operational risks, including the potential for system failures, fraud, and cybersecurity breaches. While not explicitly detailed in the provided excerpts, these risks are inherent in the banking sector and could lead to financial losses and reputational damage.
• Regulatory Compliance [high — regulatory]: As a bank, Union Bankshares is subject to extensive regulation. Changes in banking laws, capital requirements, or compliance standards could increase operating costs and impact profitability. The company must maintain robust compliance programs to mitigate these risks.

Industry Context

Union Bankshares operates within the highly competitive U.S. regional banking sector. The industry is characterized by increasing digital adoption, evolving regulatory landscapes, and a focus on efficiency. Regional banks are often challenged by larger national institutions and nimble fintech competitors, necessitating strong customer relationships and strategic product offerings.

Regulatory Implications

As a financial institution, Union Bankshares is subject to stringent regulatory oversight from bodies like the Federal Reserve and FDIC. Compliance with capital adequacy ratios, lending standards, and consumer protection laws is paramount. Any shifts in monetary policy or regulatory frameworks can significantly impact the bank's operations and profitability.

What Investors Should Do

1. Monitor loan portfolio quality and credit loss trends.
2. Analyze the drivers of noninterest income growth.
3. Assess the impact of interest rate changes on net interest margin.
4. Evaluate the bank's capital adequacy and liquidity position.

Key Dates

• 2025-09-30: End of Q3 2025 — Reporting period for the strong net income growth and asset expansion.
• 2024-09-30: End of Q3 2024 — Comparison period showing significant year-over-year improvements in profitability.
• 2025-12-31: End of Fiscal Year 2024 — Balance sheet comparison point for asset and loan growth.
• 2025-10-24: Common Shares Outstanding Recorded — Indicates a slight increase in shares outstanding, impacting EPS calculations.

Glossary

Allowance for Credit Losses on Loans

An estimate of the amount of uncollectible loans in a company's loan portfolio. It is a contra-asset account that reduces the carrying value of loans on the balance sheet. (Indicates the bank's provision for potential loan defaults, with an increase suggesting a more conservative stance or anticipation of credit deterioration.)

Investment securities available-for-sale

Securities that are not classified as held-to-maturity or trading securities. They are reported at fair value on the balance sheet, with unrealized gains and losses recorded in other comprehensive income. (Represents a significant portion of the bank's assets, and its valuation can impact equity through accumulated other comprehensive income.)

Net interest income

The difference between interest income generated by a bank's assets (like loans and securities) and the interest expense paid on its liabilities (like deposits and borrowings). (A core measure of a bank's profitability from its lending and borrowing activities.)

Noninterest income

Revenue generated from sources other than net interest income, such as service fees, wealth management, and gains on asset sales. (Diversifies revenue streams and can be a significant contributor to overall profitability, as seen with the gains on sales of loans.)

Accumulated other comprehensive loss

A component of equity that includes unrealized gains and losses on certain investments and other items that are not included in net income. (Reflects the impact of market fluctuations on the bank's investment portfolio, which can affect total equity.)

Federal funds sold and overnight deposits

Short-term lending of funds between banks, typically overnight, to meet reserve requirements or manage liquidity. (Represents a component of the bank's short-term investments and liquidity management.)

Year-Over-Year Comparison

Compared to the prior year's third quarter, Union Bankshares has demonstrated exceptional performance, with net income soaring by 159.5% and basic EPS increasing from $0.29 to $0.75. This surge is largely attributable to a robust 18.3% rise in total interest and dividend income and a remarkable more-than-doubling of total noninterest income, driven by gains on loan sales. Total assets have also seen a modest 3.0% increase, reflecting growth in the loan portfolio. The allowance for credit losses has increased, indicating a prudent approach to managing potential credit risks.

Key Financial Figures

• $2.00 — ction 12(b) of the Act: Common Stock, $2.00 par value UNB Nasdaq Stock Market (Tit
• $2 — as of October 24, 2025. Common Stock, $2 par value 4,582,423 shares UNION BANK

Filing Documents

• unb-20250930.htm (10-Q) — 2475KB
• a93025exhibit311.htm (EX-31.1) — 9KB
• a93025exhibit312.htm (EX-31.2) — 8KB
• a93025exhibit321.htm (EX-32.1) — 4KB
• a93025exhibit322.htm (EX-32.2) — 4KB
• 0000706863-25-000103.txt ( ) — 11746KB
• unb-20250930.xsd (EX-101.SCH) — 42KB
• unb-20250930_cal.xml (EX-101.CAL) — 111KB
• unb-20250930_def.xml (EX-101.DEF) — 264KB
• unb-20250930_lab.xml (EX-101.LAB) — 641KB
• unb-20250930_pre.xml (EX-101.PRE) — 502KB
• unb-20250930_htm.xml (XML) — 2782KB

FINANCIAL INFORMATION

PART I FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements. Unaudited Interim Consolidated Financial Statements of Union Bankshares, Inc. and Subsidiary Consolidated Balance Sheets 1 Consolidated Statements of Income 2 Consolidated Statements of Comprehensive Income 3 Consolidated Statements of Changes in Stockholders' Equity 4 Consolidated Statements of Cash Flows 5 Notes to Unaudited Interim Consolidated Financial Statements 7

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. 28

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk. 46

Controls and Procedures

Item 4. Controls and Procedures. 46

OTHER INFORMATION

PART II OTHER INFORMATION

Legal Proceedings

Item 1. Legal Proceedings. 47

Risk Factors

Item 1A. Risk Factors. 47

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. 47

Exhibits

Item 6. Exhibits. 47

FINANCIAL INFORMATION

PART I FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements UNIO N B ANKSHARES, INC. AND SUBSIDIARY CONSOLIDATED BALANCE SHEETS September 30, 2025 December 31, 2024 (Unaudited) Assets (Dollars in thousands) Cash and due from banks $ 4,923 $ 5,168 Federal funds sold and overnight deposits 30,550 10,670 Cash and cash equivalents 35,473 15,838 Interest bearing deposits in banks 8,457 9,462 Investment securities available-for-sale 260,404 250,504 Other investments 1,967 1,754 Total investments 262,371 252,258 Loans held for sale 4,529 5,204 Loans 1,174,273 1,155,736 Allowance for credit losses on loans ( 8,397 ) ( 7,680 ) Net deferred loan costs 2,107 2,162 Net loans 1,167,983 1,150,218 Premises and equipment, net 19,980 20,225 Other assets 75,124 75,153 Total assets $ 1,573,917 $ 1,528,358 Liabilities and Stockholders' Equity Liabilities Deposits Noninterest bearing $ 227,202 $ 226,048 Interest bearing 651,261 714,862 Time 311,123 227,984 Total deposits 1,189,586 1,168,894 Borrowed funds 270,841 259,696 Subordinated notes 16,299 16,273 Accrued interest and other liabilities 19,512 17,015 Total liabilities 1,496,238 1,461,878 Commitments and Contingencies Stockholders' Equity Common stock, $ 2.00 par value; 7,500,000 shares authorized; 5,054,654 shares issued at September 30, 2025 and 5,012,084 shares issued at December 31, 2024 10,110 10,024 Additional paid-in capital 4,234 3,031 Retained earnings 95,148 91,722 Treasury stock at cost; 472,233 shares at September 30, 2025 and 474,075 shares at December 31, 2024 ( 4,283 ) ( 4,300 ) Accumulated other comprehensive loss ( 27,530 ) ( 33,997 ) Total stockholders' equity 77,679 66,480 Total liabilities and stockholders' equity $ 1,573,917 $ 1,528,358 See accompanying notes to unaudited interim consolidated financial statements. Union Bankshares, Inc. Page 1 UNION BANKSHARES, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF INCOME (Unaudited) Three Months Ended September 30, Nine Months Ended September

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