Highlights

  • Q3 net income reached USD 14.7M, up from USD 7.3M in Q3 2024.
  • Total assets grew to USD 4.3B, driven primarily by the Fentura merger.
  • GAAP net interest margin increased to 3.73% from 3.17% year-over-year.

ChoiceOne Financial Services, Inc. (NASDAQ:COFS), parent of ChoiceOne Bank, reported net income of USD 14,681,000 for the three months ended September 30, 2025, compared to USD 7,348,000 in the same period of 2024. For the nine months ended September 30, 2025, net income was USD 14,309,000 versus USD 19,568,000 a year earlier. Excluding merger expenses and merger-related provisions for credit losses, net income totaled USD 14,681,000 for Q3 and USD 37,657,000 year-to-date.

Diluted earnings per share were USD 0.97 and USD 1.05 for Q3 and nine months, respectively, compared to USD 0.85 and USD 2.46 in the prior year. Excluding merger impacts, diluted EPS were USD 0.97 and USD 2.76 for the respective periods.

Impact of Fentura Merger
 On March 1, 2025, ChoiceOne completed the merger with Fentura Financial, Inc., which brought approximately USD 1.8B in total assets, USD 1.4B in loans, and USD 1.4B in deposits. Merger-related expenses totaled USD 13.9M or USD 1.02 per diluted share for the first nine months, while merger-related provision for credit losses was USD 9.5M or USD 0.69 per diluted share.

Balance Sheet and Loans
 Total assets reached USD 4.3B as of September 30, 2025, up USD 1.6B from a year earlier, largely due to the merger. Core loans, excluding held-for-sale loans and loans to other financial institutions, declined USD 10.3M in Q3 on an annualized basis but grew organically by USD 65.3M over the past twelve months. The merger added USD 1.4B to core loans. Loan interest income increased USD 23.9M in Q3 compared to the prior year, including USD 3.6M from purchased loan accretion.

Deposits, excluding brokered deposits, increased by USD 8.0M from the prior quarter and USD 1.3B year-over-year, mainly reflecting the merger. Non-interest-bearing deposits decreased by USD 39.9M in Q3, while interest-bearing demand deposits increased to USD 73.4M. Uninsured deposits accounted for USD 1.2B or 33.2% of total deposits on September 30, 2025.

Net Interest Income and Margin
 GAAP net interest margin increased to 3.73% in Q3 2025 from 3.17% in Q3 2024. GAAP net interest income rose to USD 37.6M, primarily due to additional net interest income attributable to the merger and accretion from purchased loans, which contributed 36 basis points to the margin.

Asset Quality and Capital Position
 Asset quality remains solid, with annualized net loan charge-offs of 0.03% and nonperforming loans at 0.69% of total loans. Shareholders’ equity increased to USD 449.6M from USD 247.7M in the prior year, reflecting merger-related stock issuance and prior share offerings. Total risk-based capital ratio stood at 12.8%, compared to 13.1% a year earlier.

Management Commentary
 Kelly Potes, CEO, stated: "Our strong financial performance this quarter is due to our outstanding employees and customers. With the Merger behind us, our team is focused on serving our clients and growing our core business. I am thankful for our employees for their hard work and our customers who trust us to be their community bank."