Rhinebeck Bancorp, Inc. (RBKB) - Q3 2025 Filing Summary
Business Context and Reporting Period
This Form 10-Q covers the quarterly period ended September 30, 2025. Rhinebeck Bancorp, Inc. is a Maryland corporation and the parent holding company of Rhinebeck Bank, a New York chartered stock savings bank. The Company operates 13 branches and 2 representative offices in Dutchess, Ulster, Orange, and Albany counties, providing commercial and consumer banking services. The Company is classified as a non-accelerated filer and a smaller reporting company.
Key Financial Metrics
| Metric | Q3 2025 (Three Months) | Q3 2024 (Three Months) | YTD 2025 (Nine Months) | YTD 2024 (Nine Months) |
|---|---|---|---|---|
| Net Income (Loss) | $2.7 million | ($8.1 million) | $7.7 million | ($6.0 million) |
| Diluted EPS | $0.25 | ($0.75) | $0.70 | ($0.55) |
| Net Interest Income | $12.0 million | $9.7 million | $34.6 million | $27.5 million |
| Net Interest Margin | 3.93% | 3.25% | 3.90% | 3.06% |
| Provision for Credit Losses | $0.9 million | $0.9 million | $1.2 million | $1.4 million |
| Total Assets | $1.32 billion | $1.26 billion (Dec 31, 2024) | N/A | |
| Total Deposits | $1.12 billion | $1.02 billion (Dec 31, 2024) | N/A | |
| Cash & Equivalents | $103.5 million | $37.5 million (Dec 31, 2024) | N/A | |
| Stockholders' Equity | $133.0 million | $121.8 million (Dec 31, 2024) | N/A |
Material Changes vs. Prior Period
- Profitability Turnaround: The Company reported a net income of $2.7 million in Q3 2025, a significant improvement from a net loss of $8.1 million in Q3 2024. The prior year's loss was heavily impacted by a $12.0 million pre-tax loss from a balance sheet restructuring involving the sale of investment securities.
- Net Interest Margin Expansion: NIM expanded by 68 basis points to 3.93% in Q3 2025 compared to 3.25% in Q3 2024. This was driven by higher yields on loans and securities and a decline in the cost of interest-bearing liabilities.
- Liquidity Position: Cash and cash equivalents increased by $66.0 million (176%) to $103.5 million, primarily due to deposit growth and proceeds from the reduction of available-for-sale securities.
- Loan Portfolio Shift: Net loans increased slightly by $5.9 million. Notably, the Company executed a strategic reduction in indirect automobile loans of $61.6 million, while commercial real estate loans grew by $57.8 million.
- Deposit Growth: Total deposits increased by $95.0 million (9.3%), driven by growth in money market accounts and certificates of deposit as the Bank promoted higher-yielding products.
Guidance, Outlook, and Management Commentary
- Strategic Pivot in Mortgage Origination: The Bank has discontinued direct residential mortgage origination. It has partnered with Homestead Funding Corporation to originate mortgages, which the Bank will then purchase and service. This move addresses shifting industry dynamics and competition from non-bank lenders.
- Branch Optimization: The Bank announced the closure of its Middletown branch effective January 27, 2026, to enhance operational efficiency. The Goshen branch will extend hours to include Saturday service starting January 31, 2026, to accommodate affected customers.
- Capital Position: The Bank remains "well capitalized" under regulatory frameworks. Total capital to risk-weighted assets was 13.88% as of September 30, 2025.
- Interest Rate Risk: Management utilizes an Asset/Liability Management Committee (ALCO) to monitor interest rate risk. Net Economic Value (EVE) modeling indicates sensitivity to rate changes, with a projected 17.3% decrease in EVE if rates rise 400 basis points.
- Risks: Key risks include general economic conditions, changes in loan delinquencies, liquidity management, and the impact of inflation and interest rate fluctuations on margins.
Investor Verification Checklist
- Non-Recurring Items: Verify the impact of the $12.0 million loss from the 2024 balance sheet restructuring on year-over-year comparisons.
- Asset Quality: Review the allowance for credit losses (ACL) adequacy given the shift from consumer auto loans to commercial real estate loans.
- Liquidity Strategy: Assess the sustainability of the $103.5 million cash position and the reliance on deposit growth versus wholesale funding (FHLB advances decreased significantly).
- Branch Closure Costs: Monitor for any one-time costs associated with the planned closure of the Middletown branch in early 2026.
- Securities Portfolio: Review the unrealized losses on available-for-sale securities ($8.9 million) and the Company's intent to hold these assets to maturity.