Highlights

  • Third quarter 2026 net income was $17.5 million, or $1.57 per diluted share, against $14.1 million, or $1.62, a year earlier.
  • Esquire completed its acquisition of Signature Bancorporation, Inc. effective August 1, 2026, on a purchase price of $466.1 million.
  • Net interest margin was 5.74% for the quarter, compared with 5.96% in the prior linked quarter.
  • Core systems conversions are in progress and targeted for April 2027, according to the company.

Esquire Financial Holdings (NASDAQ: ESQ) shares were trading at USD 129.41 on October 27, 2026, up 4.50%, with a relative volume at time of 4.27. The financial holding company for Esquire Bank, National Association, completed its acquisition of Signature Bancorporation, Inc. effective August 1, 2026, and reported third quarter 2026 results on October 27, 2026, with management discussing 2027 guidance on its earnings call.

Esquire is incorporated in Maryland and lists its principal executive offices in Jericho, New York. Through Esquire Bank, it provides commercial banking and a payments platform, with a national litigation vertical serving plaintiff law firms. The company said its payment processing platform serves 94,000 small business clients across all 50 states. With the Signature merger, the combined company has operations in New York and Chicago.

Third Quarter 2026 Results

Net income was $17.5 million, or $1.57 per diluted share, compared with $13.0 million, or $1.49 per diluted share, in the second quarter of 2026. Excluding $8.9 million of pretax merger expenses and $938 thousand of discrete tax benefits, adjusted net income, a non-GAAP measure, was $23.6 million, or $2.12 per diluted share. For the nine months ended September 30, 2026, net income was $42.7 million, or $4.48 per diluted share, compared with $37.4 million, or $4.32, a year earlier.

Returns on average assets and equity were 1.73% and 11.11%, compared with 2.61% and 20.83% in the third quarter of 2025. Net interest income was $53.5 million. Net interest margin was 5.74%, which the company said decreased 30 basis points from a year earlier, primarily from the Signature merger. The provision for credit losses was $1.8 million.

Noninterest income was $7.9 million. Payment processing income was $5.4 million, and the company said fee income growth has been muted at the legacy payments platform due to changes in its merchant risk profile and composition. Noninterest expense was $36.0 million, including $8.9 million of merger expenses and $1.8 million of core deposit intangible amortization. The efficiency ratio was 58.6%, compared with 48.9% in 2025, and the adjusted efficiency ratio, a non-GAAP measure, was 41.1%. The effective tax rate was 26.0%.

Signature Merger, Balance Sheet and Credit

Signature's acquired assets, loans and deposits had fair values of $1.90 billion, $1.36 billion and $1.65 billion, producing $246.9 million of goodwill and a $49.3 million core deposit intangible. The combined closing balance sheet showed assets of approximately $4.75 billion and equity of $778.7 million.

Loans were $3.43 billion and deposits were $3.98 billion at September 30, 2026. Litigation-related loans were $1.46 billion, or 42.5% of total loans, compared with 68.1% in the prior linked quarter. Noninterest bearing demand deposits were $1.11 billion.

The allowance for credit losses was $44.7 million, or 1.30% of loans. Nonperforming loans were $8.6 million and nonperforming assets were $9.6 million. The common equity tier 1 ratio was 12.95%, and the tangible common equity to tangible assets ratio, a non-GAAP measure, was 10.91%.

Outlook and Management Commentary

Management said core systems conversions are targeted for April 2027 and that there has been no material client attrition to date. The company stated it believes results will be higher than the earnings expectations it announced with the merger on March 12, 2026.

On the earnings call, management gave 2027 guidance of about $500 million of loan growth, diluted earnings per share of $9.00, a net interest margin of 5.70% to 5.75%, fee income of $33 million to $34 million, and noninterest expense of $138 million to $140 million. The net interest margin assumes one additional rate increase. Management said the dividend payout decision will be discussed at the board meeting and will weigh capital preservation against growth. These are management expectations and are subject to change.