Burke & Herbert Financial Services Corp. Announces Fourth Quarter and Full Year 2025 Results and Declares Common Stock Dividend
ALEXANDRIA, Va., Jan. 22, 2026 (GLOBE NEWSWIRE) -- Burke & Herbert Financial Services Corp. (the "Company" or "Burke & Herbert") (NASDAQ:BHRB) reported financial results for the quarter and the year ended December 31, 2025. In addition, at its meeting on January 22, 2026, the board of directors declared a $0.55 per share regular cash dividend to be paid on March 2, 2026, to shareholders of record as of the close of business on February 13, 2026.
From David P. Boyle, Company Chair and Chief Executive Officer
"Our fourth quarter 2025 results are a fitting cap to a year marked by disciplined execution. Our balance sheet remains strong and well-positioned, asset quality metrics improved, and we once again delivered top quartile returns compared to our peers. At the beginning of the year, we set goals to achieve a more granular, diverse and relationship-based loan portfolio, to grow our core deposits and non-interest income by delivering our full suite of products and services, and to continue our expansion into new and existing markets. We accomplished those goals and I am incredibly proud of the teamwork demonstrated across the Company to deliver what we said we would. By staying true to our core values of serving & leading, delivering more, elevating everyone, and always being invested in the long-term success of those around us, the foundation as we enter 2026 is solid. I'm grateful for the support of our shareholders and look forward to delivering increased value for them, our customers, our employees, and our communities."
Q4 2025 Highlights
For the quarter, net income applicable to common shares totaled $30.0 million, and diluted earnings per common share ("EPS") was $1.98.
For the quarter, the annualized return on average assets was 1.49% and the annualized return on average equity was 14.14%.
For the twelve months ended December 31, 2025, net income applicable to common shares totaled $116.4 million, and diluted earnings per common share was $7.72.
For the twelve months ended December 31, 2025, the return on average assets was 1.48% and the return on average equity was 14.76%.
Ending total gross loans were $5.4 billion and ending total deposits were $6.4 billion; ending loan-to-deposit ratio was 84.1%. The net interest margin (non-GAAP1) was 4.11% for the three months ended December 31, 2025 and 4.14% for the twelve months ended December 31, 2025.
The balance sheet remains strong with ample liquidity. Total liquidity, including all available borrowing capacity with cash and cash equivalents, totaled $4.8 billion at the end of the fourth quarter.
Asset quality metrics remain within the Company's moderate risk profile with adequate reserve coverage.
The Company continues to be well-capitalized, ending the quarter with 13.2%2 Common Equity Tier 1 capital to risk-weighted assets, 15.9%2 Total risk-based capital to risk-weighted assets, and a leverage ratio of 10.9%.2
Donations made by the Burke & Herbert Bank Foundation in support of communities across our footprint surpassed $1 million.
On December 18, 2025, the Company and LINKBANCORP, Inc. ("LINK") (NASDAQ:LNKB) announced the signing of a definitive merger agreement under which LINK will merge with and into the Company in an all-stock transaction (the "transaction"). When and if the proposed transaction is completed, the combined organization will create a financial holding company with approximately $11 billion in assets and more than 100 locations across Delaware, Kentucky, Maryland, Pennsylvania, Virginia, and West Virginia, with more than 1,000 employees serving our communities. Completion of the proposed transaction is subject to receiving the requisite approvals of the Company's and LINK's shareholders, receipt of all required regulatory approvals, and fulfillment of other customary closing conditions.
Results of Operations
Fourth Quarter 2025 compared to Third Quarter 2025
The Company reported fourth quarter 2025 net income applicable to common shares of $30.0 million, or $1.98 per diluted common share, compared to third quarter 2025 net income applicable to common shares of $29.7 million, or $1.97 per diluted common share.
Period-end total gross loans were $5.4 billion at December 31, 2025, a decrease of $171.8 million from September 30, 2025, as the Company exited approximately $201.5 million of non-strategic loans while originating $383.3 million of new, relationship-based loan commitments.
Period-end total deposits were $6.4 billion at December 31, 2025, a decrease of $8.1 million from September 30, 2025. Excluding a $60.0 million decrease in brokered deposits, core deposits increased $51.9 million.
Net interest income for the quarter was $74.9 million compared to $73.8 million in the prior quarter due to a decrease in interest expense of $1.2 million. The decrease in total interest expense was primarily driven by lower deposit costs from a decrease in the balance of brokered time deposits and lower rates on certain deposit products.
Net interest margin on a fully taxable equivalent basis (non-GAAP1) increased to 4.11% versus 4.08% in the third quarter of 2025, mainly attributable to a decrease in yield on interest-bearing liabilities compared to the third quarter of 2025.
Accretion income on loans during the quarter was $8.7 million, and the amortization expense impact on interest expense was $1.4 million, or 39.3 bps of net interest margin on an annualized basis in the fourth quarter of 2025. In the prior quarter, accretion income on loans during the quarter was $8.2 million, and the amortization expense impact on interest expense was $1.4 million, or 36.7 bps of net interest margin on an annualized basis.
The cost of total deposits, including non-interest bearing deposits, was 1.80% in the fourth quarter of 2025, compared to 1.87% in the third quarter of 2025. The decrease in the cost of deposits was mostly due to a decrease in the rate paid on interest-bearing deposits compared to the third quarter of 2025.
The Company recorded credit provision expense in the fourth quarter of 2025 of $136 thousand and the Company's allowance for credit losses at December 31, 2025, was $67.8 million, or 1.3% of total loans.
Total non-interest income for the fourth quarter of 2025 was $11.6 million compared to $11.6 million in the prior quarter. While collection of death proceeds from company-owned life insurance increased non-interest income by $1.7 million in the fourth quarter, this increase was offset by decreases in other categories of non-interest income including service charges and fees, net gains (losses) on securities and other non-interest income in the fourth quarter of 2025 compared to the third quarter of 2025.
Non-interest expense for the fourth quarter of 2025 was $48.5 million compared to $48.1 million in the third quarter of 2025, with all categories remaining relatively flat quarter over quarter.
Regulatory capital ratios2
The Company continues to be well-capitalized with capital ratios that are above regulatory requirements. As of December 31, 2025, our Common Equity Tier 1 capital to risk-weighted asset and Total risk-based capital to risk-weighted asset ratios were 13.2%2 and 15.9%2, respectively, and significantly above the well-capitalized requirements of 6.5% and 10%, respectively. The leverage ratio was 10.9%2 compared to a 5% level to be considered well-capitalized.
Burke & Herbert Bank & Trust Company ("the Bank"), the Company's wholly-owned bank subsidiary, also continues to be well-capitalized with capital ratios that are above regulatory requirements. As of December 31, 2025, the Bank's Common Equity Tier 1 capital to risk-weighted asset and Total risk-based capital to risk-weighted asset ratios were 14.8%2 and 15.9%,2 respectively, and significantly above the well-capitalized requirements. In addition, the Bank's leverage ratio of 11.6%2 is considered to be well-capitalized.
For more information about the Company's financial condition, including additional disclosures pertinent to recent events in the banking industry, please see our financial statements and supplemental information attached to this release.
About Burke & Herbert
Burke & Herbert Financial Services Corp. is the financial holding company for Burke & Herbert Bank & Trust Company. Burke & Herbert Bank & Trust Company is the oldest continuously operating bank under its original name headquartered in the greater Washington, D.C. metropolitan area. With over 75 branches across Delaware, Kentucky, Maryland, Virginia, and West Virginia, Burke & Herbert Bank & Trust Company offers a full range of business and personal financial solutions designed to meet customers' banking, borrowing, and investment needs. Learn more at investor.burkeandherbertbank.com.
Cautionary Note Regarding Forward-Looking Statements
This presentation includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including with respect to (or based on) the beliefs, goals, intentions, and expectations of Burke & Herbert and LINK regarding the proposed transaction, revenues, earnings, earnings per share, loan production, asset quality, and capital levels, among other matters; our estimates of future costs and benefits of the actions we may take; our assessments of expected losses on loans; our assessments of interest rate and other market risks; our ability to achieve our financial and other strategic goals; the expected timing of completion of the proposed transaction; the expected cost savings, synergies, returns and other anticipated benefits from the proposed transaction; and other statements that are not historical facts. Forward–looking statements are typically identified by such words as "believe," "expect," "anticipate," "intend," "outlook," "estimate," "forecast," "project," "will," "should," and other similar words and expressions, and are subject to numerous assumptions, risks, and uncertainties, which change over time. Forward-looking statements include, without limitation, those relating to the terms, timing and closing of the proposed transaction. Additionally, forward–looking statements speak only as of the date they are made; Burke & Herbert and LINK do not assume any duty, and do not undertake, to update such forward–looking statements, whether written or oral, that may be made from time to time, whether as a result of new information, future events, or otherwise. Furthermore, because forward–looking statements are subject to assumptions and uncertainties, actual results or future events could differ, possibly materially, from those indicated in or implied by such forward-looking statements as a result of a variety of factors, many of which are beyond the control of Burke & Herbert and LINK. Such statements are based upon the current beliefs and expectations of the management of Burke & Herbert and LINK and are subject to significant risks and uncertainties outside of the control of the parties. Caution should be exercised against placing undue reliance on forward-looking statements. The factors that could cause actual results to differ materially include the following: the occurrence of any event, change or other circumstances that could give rise to the right of one or both of the parties to terminate the definitive merger agreement between Burke & Herbert and LINK; the outcome of any legal proceedings that may be instituted against Burke & Herbert or LINK; the possibility that the proposed transaction will not close when expected or at all because required regulatory, shareholder or other approvals are not received or other conditions to the closing are not satisfied on a timely basis or at all, or are obtained subject to conditions that are not anticipated (and the risk that required regulatory approvals may result in the imposition of conditions that could adversely affect the combined company or the expected benefits of the proposed transaction); the ability of Burke & Herbert and LINK to meet expectations regarding the timing, completion and accounting and tax treatments of the proposed transaction; the risk that any announcements relating to the proposed transaction could have adverse effects on the market price of the common stock of either or both parties to the proposed transaction; the possibility that the anticipated benefits of the proposed transaction will not be realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of the two companies or as a result of the strength of the economy and competitive factors in the areas where Burke & Herbert and LINK do business; certain restrictions during the pendency of the proposed transaction that may impact the parties' ability to pursue certain business opportunities or strategic transactions; the possibility that the transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events; diversion of management's attention from ongoing business operations and opportunities; the possibility that the parties may be unable to achieve expected synergies and operating efficiencies in the merger within the expected timeframes or at all and to successfully integrate LINK's operations and those of Burke & Herbert; such integration may be more difficult, time-consuming or costly than expected; revenues following the proposed transaction may be lower than expected; Burke & Herbert's and LINK's success in executing their respective business plans and strategies and managing the risks involved in the foregoing; the dilution caused by Burke & Herbert's issuance of additional shares of its capital stock in connection with the proposed transaction; effects of the announcement, pendency or completion of the proposed transaction on the ability of Burke & Herbert and LINK to retain customers and retain and hire key personnel and maintain relationships with their suppliers, and on their operating results and businesses generally; and risks related to the potential impact of general economic, political and market factors on the companies or the proposed transaction and other factors that may affect future results of Burke & Herbert and LINK; and the other factors discussed in the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of each of Burke & Herbert's and LINK's Quarterly Report on Form 10–Q for the quarters ended March 31, 2025, June 30, 2025 and September 30, 2025, and other reports Burke & Herbert and LINK file with the SEC.
Additional Information and Where to Find It
In connection with the proposed transaction, Burke & Herbert will file a registration statement on Form S-4 with the SEC to register the shares of Burke & Herbert common stock to be issued in connection with the proposed transaction. The registration statement will include a joint proxy statement of Burke & Herbert and LINK, which also constitutes a prospectus of Burke & Herbert, that will be sent to shareholders of Burke & Herbert and shareholders of LINK seeking certain approvals related to the proposed transaction. Each of Burke & Herbert and LINK may file with the SEC other relevant documents concerning the proposed transaction. This presentation does not constitute an offer to sell or a solicitation of an offer to buy any securities or a solicitation of any vote or approval, nor shall there be any offer or sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of the Securities Act of 1933, as amended. INVESTORS AND SHAREHOLDERS OF BURKE & HERBERT AND LINK AND THEIR RESPECTIVE AFFILIATES ARE URGED TO READ, WHEN AVAILABLE, THE REGISTRATION STATEMENT ON FORM S-4, THE JOINT PROXY STATEMENT/PROSPECTUS TO BE INCLUDED WITHIN THE REGISTRATION STATEMENT ON FORM S-4 AND ANY OTHER RELEVANT DOCUMENTS FILED OR TO BE FILED WITH THE SEC IN CONNECTION WITH THE PROPOSED TRANSACTION, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT BURKE & HERBERT, LINK AND THE PROPOSED TRANSACTION. Investors and shareholders will be able to obtain a free copy of the registration statement, including the joint proxy statement/prospectus, as well as other relevant documents filed with the SEC containing information about Burke & Herbert and LINK, without charge, at the SEC's website www.sec.gov. Copies of documents filed with the SEC by Burke & Herbert will be made available free of charge in the "Investor Relations" section of Burke & Herbert's website, www.burkeandherbertbank.com, under the heading "Financials." Copies of documents filed with the SEC by LINK will be made available free of charge in the "Investor Relations" section of LINK's website, www.linkbank.com, under the heading "Financials." The information on Burke & Herbert's or LINK's respective websites is not, and shall not be deemed to be, a part of this presentation or incorporated into other filings either company makes with the SEC.
Participants in Solicitation
Burke & Herbert, LINK, and certain of their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from shareholders of Burke & Herbert and shareholders of LINK in respect of the proposed transaction under the rules of the SEC. Information regarding Burke & Herbert's directors and executive officers is available in its definitive proxy statement, which was filed with the SEC on March 31, 2025, and certain other documents filed by Burke & Herbert with the SEC. Information regarding LINK's directors and executive officers is available in its definitive proxy statement, which was filed with the SEC on April 17, 2025, and certain other documents filed by LINK with the SEC. Other information regarding the participants in the solicitation of proxies in respect of the proposed transaction and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the joint proxy statement/prospectus and other relevant materials to be filed with the SEC. Free copies of these documents, when available, may be obtained as described in the preceding paragraph.
Burke & Herbert Financial Services Corp.Consolidated Statements of Income (unaudited)(In thousands)
Three Months Ended
Twelve Months Ended
December 31,
September 30,
December 31,
2025
2024
2025
2025
2024
Interest income
Taxable loans, including fees
$
93,828
$
97,903
$
95,132
$
382,794
$
311,303
Tax-exempt loans, including fees
44
37
47
180
118
Taxable securities
8,955
9,868
9,062
36,807
39,817
Tax-exempt securities
5,295
3,191
4,863
17,364
10,243
Other interest income
3,018
1,794
2,105
7,848
4,680
Total interest income
111,140
112,793
111,209
444,993
366,161
Interest expense
Deposits
29,401
35,919
30,286
121,969
118,664
Short-term borrowings
4,471
3,383
4,379
16,480
14,189
Subordinated debt
2,320
2,754
2,748
10,527
7,412
Other interest expense
26
27
26
105
111
Total interest expense
36,218
42,083
37,439
149,081
140,376
Net interest income
74,922
70,710
73,770
295,912
225,785
Credit loss expense - loans and available-for-sale securities
135
960
574
2,326
20,475
Credit loss (recapture) - off-balance sheet credit exposures
1
(127
)
(312
)
(803
)
3,745
Total provision for credit losses
136
833
262
1,523
24,220
Net interest income after credit loss expense
74,786
69,877
73,508
294,389
201,565
Non-interest income
Fiduciary and wealth management
2,923
2,429
2,664
10,455
8,411
Service charges and fees
2,002
1,742
2,070
8,197
6,719
Net gains (losses) on securities
(95
)
744
212
156
1,357
Income from company-owned life insurance
2,803
1,887
1,152
8,130
4,686
Bank debit and other card revenue
3,164
3,064
3,192
12,264
9,772
Other non-interest income
837
1,925
2,295
6,917
5,221
Total non-interest income
11,634
11,791
11,585
46,119
36,166
Non-interest expense
Salaries and wages
20,332
25,818
20,848
83,441
77,089
Pensions and other employee benefits
4,889
4,840
4,429
18,521
17,186
Occupancy
3,396
3,630
3,479
14,441
11,577
Equipment rentals, depreciation and maintenance
3,733
4,531
3,908
15,825
23,174
Core deposit intangible amortization
3,684
4,298
3,683
15,553
11,460
ATM, card and network expense
1,107
2,099
1,200
4,753
5,398
FDIC and other regulatory assessments
926
829
976
3,904
3,329
Other operating
10,432
15,365
9,569
39,122
48,620
Total non-interest expense
48,499
61,410
48,092
195,560
197,833
Income before income taxes
37,921
20,258
37,001
144,948
39,898
Income tax expense
7,667
465
7,037
27,632
4,190
Net income
30,254
19,793
29,964
117,316
35,708
Preferred stock dividends
225
225
225
900
675
Net income applicable to common shares
$
30,029
$
19,568
$
29,739
$
116,416
$
35,033
Burke & Herbert Financial Services Corp.Consolidated Balance Sheets(In thousands)
December 31, 2025
December 31, 2024
(Unaudited)
(Audited)
Assets
Cash and due from banks
$
53,497
$
35,554
Interest-earning deposits with banks
235,630
99,760
Cash and cash equivalents
289,127
135,314
Securities available-for-sale, at fair value
1,615,954
1,432,371
Restricted stock, at cost
42,187
33,559
Loans held-for-sale, at fair value
365
2,331
Loans
5,387,676
5,672,236
Allowance for credit losses
(67,823
)
(68,040
)
Net loans
5,319,853
5,604,196
