Columbia Banking System COLB posted first-quarter 2026 operating earnings of 72 cents per share, beating the Zacks Consensus Estimate of 68 cents. The figure improved 7.5% from 67 cents in the prior-year quarter.
Net income (GAAP) was $192 million compared with $87 million in the year-ago quarter.
Quarterly results reflected higher net interest income (NII) and a rise in non-interest income. However, higher provisions and non-interest expenses were the undermining factors.
COLB’s NII Trends Stay Supportive, Fee Businesses Improve
Total revenues came in at $677 million, up 37.9% year over year. The metric also beat the Zacks Consensus Estimate of $673.1 million.
COLB’s NII was $594 million, up 39.8% from the first quarter of 2025. The increase reflects the larger balance sheet following the Pacific Premier acquisition and a more profitable mix of assets and liabilities during the period.
The net interest margin expanded 36 basis points year over year to 3.96%. Funding costs were lower than the year-ago quarter, with the cost of interest-bearing deposits at 2.04%, improving 48 basis points from 2.52%. The company also cited active management of deposit rates and mix as contributing factors.
Columbia’s non-interest income was $83 million, up 25.8% from the year-ago level. Within the quarter, management noted that customer activity typically slows in the first quarter, which weighed on certain customer-driven categories such as swap, syndication and international banking revenues versus the immediately preceding quarter.
COLB Cost Structure Reflects Integration Progress
Columbia Banking System’s non-interest expenses were $394 million, up 15.9% from the first quarter of 2025. The year-over-year increase reflected higher costs across several categories on a larger operating base, including salaries and employee benefits of $196 million, up 35.2% from $145 million.
Merger and restructuring expenses were $24 million, up from $14 million in the year-ago quarter. Even so, management highlighted that acquisition-related cost savings are being realized as system conversions and branch consolidations were completed in the first quarter of 2026, and the company expects to realize the previously disclosed cost savings by June 30, 2026.
COLB’s Loans & Deposits Decline Sequentially
As of March 31, 2026, loans and leases were $47.7 billion, down marginally sequentially. The decline reflected continued expected run-off in below-market-rate transactional loans, partially offset by growth in commercial loans.
Total deposits declined 1% sequentially to $53.5 billion. The decrease reflected an intentional reduction in brokered deposits, partially offset by an increase in customer deposits.
Columbia Banking System’s Credit Quality Deteriorates
COLB’s provision for credit losses was $28 million, up 3.7% from $27 million in the year-ago quarter. Net charge-offs were 0.30% of average loans and leases (annualized), down from 0.32% a year earlier. Non-performing assets totaled $264 million, up 48.3% from $178 million, and the non-performing assets-to-total assets ratio moved to 0.40% from 0.35% in the first quarter of 2025.
Columbia Banking System’s Capital Ratios Improve
As of March 31, 2026, the estimated total risk-based capital ratio was 13.3%, up from 12.9% in the first quarter of 2025. The estimated common equity Tier 1 (CET1) risk-based capital ratio was 11.5%, up from 10.6% in the prior-year quarter.
COLB’s Share Repurchases Update
In the reported quarter, Columbia Banking System repurchased 6.5 million common shares at an average price of $30.74.
Our Viewpoint on COLB
Columbia Banking System’s scaled Western footprint, granular deposit base and relationship banking focus support NII and balanced fee income growth. The net interest margin’s stability reflects deposit repricing and lower wholesale funding. In the quarter, COLB noted that it completed the systems conversion and nine branch consolidations tied to the Pacific Premier acquisition. Management expects to realize all previously disclosed cost savings by June 30, 2026.
However, integration and amortization costs keep expenses elevated. Planned transactional loan run-off is expected to limit near-term growth.
Columbia Banking System, Inc. Price, Consensus and EPS Surprise
Columbia Banking System, Inc. price-consensus-eps-surprise-chart | Columbia Banking System, Inc. Quote
At present, COLB carries a Zacks Rank 3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Banks
First Horizon Corporation FHN posted first-quarter 2026 earnings per share of 53 cents, surpassing the Zacks Consensus Estimate of 49 cents. This compares favorably with 42 cents in the year-ago quarter.
FHN’s results benefited from higher NII and a rise in non-interest income, along with improved credit quality. However, the rise in expenses remains a headwind.
WaFd, Inc.’s WAFD second-quarter fiscal 2026 (ended March 31) adjusted earnings of 83 cents per share beat the Zacks Consensus Estimate of 74 cents. The bottom line also jumped 27.7% year over year.
WAFD’s results reflected higher NII and non-interest income. However, elevated expenses and provisions were the undermining factors. A decline in loans and deposits was another headwind.
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This article originally published on Zacks Investment Research (zacks.com).