United Bancorp's Q4 Earnings Rise Y/Y on Loan Demand

Core Insights - United Bancorp, Inc. (UBCP) shares increased by 2.6% following the earnings report for Q4 2025, outperforming the S&P 500's decline of 1.1% during the same period [1] - The company reported an earnings per share (EPS) of 35 cents, a 12.9% increase from 31 cents in Q4 2024 [1] Financial Performance - Total interest income for Q4 2025 grew by 5.2% year-over-year to $10.6 million, primarily due to an 8.3% increase in interest income on loans [2] - Net interest income rose by 8.6% to $6.9 million, while net income reached $2 million, reflecting a 10% year-over-year increase [2] - Full-year net income for 2025 was $7.8 million, up 4.7%, with EPS increasing to $1.34, a 5.5% rise compared to $1.27 in 2024 [3] Balance Sheet and Asset Growth - Total assets increased by $40.8 million (5%) to $857.4 million as of Dec. 31, 2025 [4] - Average loans rose by 3.5% year-over-year to $497.9 million, and average deposits increased by 2.5% to $635.3 million [4] Interest Margin and Credit Quality - The net interest margin improved by 19 basis points to 3.70% from 3.51% the previous year, aided by organic loan growth and strategic balance sheet management [5] - Nonaccrual loans rose to $2.3 million (0.46% of gross loans), but were still considered manageable [6] Management Commentary and Strategic Outlook - CFO Randall Greenwood noted that the performance was achieved amid significant investment initiatives, which increased noninterest expenses by 19.5% in the quarter [7] - The company is responding to macroeconomic headwinds through balance sheet expansion and interest margin management [8] Future Plans and Growth Drivers - CEO Scott Everson emphasized the goal of growing total assets to over $1 billion, with infrastructure investments expected to enhance efficiency and customer acquisition [11] - Strong demand in the small business commercial loan segment, which comprises 81% of total loans, is anticipated to be a key growth driver [12] Shareholder Returns - Total cash dividends increased by 7.6% to 92 cents in 2025, including a 16.7% rise in the special dividend, resulting in a total dividend yield of 6.4% [14]