Catalyst Bancorp, Inc. (CLST) - Q2 2026 Filing Summary
Business Context and Reporting Period
This Form 10-Q covers the quarterly period ended June 30, 2026. Catalyst Bancorp, Inc. is the holding company for Catalyst Bank, a community-oriented savings bank serving south-central Louisiana. The Company operates as a non-accelerated filer and a smaller reporting company. A significant subsequent event occurred on July 14, 2026, with the completion of the acquisition of Lakeside Bancshares, Inc. and Lakeside Bank.
Key Financial Metrics
| Metric | Q2 2026 (Three Months) | YTD 2026 (Six Months) | Balance Sheet (June 30, 2026) |
|---|---|---|---|
| Net Income | $524,000 | $1,082,000 | - |
| Earnings Per Share (Diluted) | $0.14 | $0.30 | - |
| Total Assets | - | - | $290.0 million |
| Total Loans (Net) | - | - | $160.6 million |
| Total Deposits | - | - | $196.4 million |
| Shareholders' Equity | - | - | $82.5 million |
| Net Interest Margin | 3.86% | 3.84% | - |
| Efficiency Ratio | 80.64% | 79.72% | - |
| Allowance for Credit Losses | - | - | $2.2 million (1.34% of loans) |
Material Changes vs. Prior Period
- Net Income: Q2 2026 net income was flat at $524,000 compared to $521,000 in Q2 2025. YTD 2026 net income decreased slightly to $1.1 million from $1.1 million in YTD 2025.
- Interest Income: Total interest income increased 3.6% in Q2 and 4.7% YTD, driven primarily by a 92.9% increase in investment securities income due to higher balances and yields.
- Provision for Credit Losses: The Company recorded a reversal of credit losses of $104,000 in Q2 and $174,000 YTD, compared to zero provision in the prior year periods. This was driven by declining loan balances and improved asset quality.
- Non-Interest Expense: Expenses increased 9.3% in Q2 and 12.1% YTD. This includes merger-related expenses of $87,000 (Q2) and $182,000 (YTD) associated with the Lakeside acquisition.
- Loan Portfolio: Total loans decreased 4.4% to $162.8 million, primarily due to a $5.0 million construction loan converting to commercial real estate and a $5.9 million commercial loan payoff.
- Deposits: Total deposits grew 6.0% to $196.4 million, driven by growth in high-yield savings accounts.
Outlook, Risks, and Unusual Items
- Acquisition of Lakeside Bancshares: On July 14, 2026, the Company completed the acquisition of Lakeside Bancshares for $41.1 million in cash. Preliminary estimates indicate the combined entity will have approximately $632 million in assets, $387 million in loans, and $480 million in deposits. Purchase accounting remains preliminary.
- Asset Quality: Non-performing loans decreased to $2.3 million (1.43% of total loans) from $2.6 million in the prior year. The allowance for credit losses covers 94.1% of non-performing loans.
- Share Repurchases: The Company repurchased 40,820 shares YTD 2026 at an average price of $16.00. Repurchases were paused during the Lakeside due diligence period. Approximately 148,091 shares remain available under the current plan.
- Risk Factors: Key risks include integration challenges with the Lakeside acquisition, interest rate volatility affecting net interest margin, and general economic conditions in the Acadiana region.
Investor Verification Checklist
- Verify the final purchase accounting and goodwill valuation for the Lakeside Bancshares acquisition once the measurement period concludes.
- Monitor the integration progress and realization of cost synergies from the Lakeside merger.
- Review the composition of the loan portfolio, specifically the conversion of construction loans to amortizing real estate loans and its impact on yield.
- Assess the sustainability of deposit growth, particularly in high-yield savings accounts, and its impact on future interest expense.
- Confirm the status of the $148,091 shares remaining available for repurchase under the November 2025 plan.