Union Bankshares, Inc.

What they do

Union Bankshares operates as a community bank, providing full retail, commercial, municipal banking, and wealth management and trust services through 18 branch locations, three loan centers, and several ATMs, along with digital channels. The company generates income primarily from interest and fees on loans and earnings on investments, with expenses driven by interest paid on deposits and borrowings, salaries, and other overhead. As of December 31, 2025, it had 195 full-time employees.

Revenue drivers

• Interest income on loans — The largest earning asset category; total loans were $1.12 billion as of June 30, 2026, with modest growth of $14.0 million year-over-year.
• Investment securities — Securities portfolio increased 27.0% to $308.0 million as of June 30, 2026, from $242.4 million a year earlier, due to a strategic decision to pre-invest future cash flows.
• Noninterest income — Includes gains on sale of real estate loans, loan servicing income, and service fees; mortgage loan sales were $56.9 million for the first half of 2026, similar to the prior year.

Recent performance

For Q2 2026, consolidated net income was $2.9 million ($0.61 per share) versus $2.4 million ($0.53 per share) in Q2 2025. Six-month net income was $5.9 million ($1.26 per share) compared to $4.9 million ($1.08 per share) in the prior year. Total assets reached $1.56 billion as of June 30, 2026, up 5.3% year-over-year, driven by securities and loan growth. Book value per share rose 16.7% to $18.28, aided by equity sales and a smaller accumulated other comprehensive loss. Credit loss expense decreased slightly, while noninterest expenses and income tax expense increased.

Strategy

Management highlights disciplined execution and balance sheet strength, focusing on growing net interest income and book value. A strategic decision to pre-invest future securities cash flows in Q4 2025 drove significant securities portfolio growth. The company is actively raising capital via an equity distribution agreement, having sold 384,066 shares for net proceeds of $8.6 million by June 30, 2026. They continue to sell qualifying mortgage loans to manage interest rate risk and maintain asset quality with an appropriate allowance for credit losses.

Risks

• Geographic concentration — A substantial portion of the loan portfolio is secured by real estate in Vermont and New Hampshire, making results vulnerable to adverse local economic conditions or natural hazards.
• Credit losses — If the allowance for credit losses proves insufficient to cover actual loan losses, earnings could decline; the adequacy of the ACL is a critical accounting estimate.
• Interest rate risk — Net interest income depends on interest rate levels and changes; the company faces risk from shifts in rates affecting both earning assets and funding costs.
• Regulatory and economic factors — Changes in regulation, inflation, federal tariff and trade policies, or eroding public confidence in the banking system could adversely affect operations.

Outlook

Management expresses confidence in the bank's positioning, citing strong asset quality and a talented team during a leadership transition. They continue to monitor macroeconomic indicators that may impact borrower behavior and repayment capacity. The company has not identified any events after June 30, 2026 that would materially affect its financial position, but forward-looking statements are subject to numerous risks including interest rates, competition, and economic conditions.