VersaBank reported a 53% year-over-year increase in net income to C$10.1 million for its fiscal third quarter ended September 3, 2026, as total assets surpassed C$7 billion for the first time. The Canadian digital lender posted record revenue of C$38.8 million, up 23% from the prior year, while adjusted net income rose 27% to C$12.3 million.
The bank’s credit asset portfolio expanded 29% annually to a record C$6.16 billion, with the U.S. Structured Receivable Program (SRP) contributing US$220 million in new fundings during the quarter. Total U.S. SRP fundings for fiscal 2026 exceeded US$720 million, with 90% originating from the core SRP structure. Digital Banking USA revenue surged 199% year-over-year to C$9.3 million, while net income from U.S. operations jumped 803% to C$3.9 million. The SRP portfolio now stands at C$5.2 billion, representing 85% of total credit assets.
Net interest margin on credit assets declined 11 basis points year-over-year to 2.44%, reflecting broader funding cost pressures. The overall net interest margin fell to 2.19%, down 6 basis points annually, though the cost of funds improved 17 basis points to 3.16%. Non-interest expenses totaled C$25.2 million, up 16% from a year earlier but down 8% sequentially. Adjusted non-interest expenses were C$22.1 million, with C$2.3 million attributed to share-based compensation and transitory costs.
Capital ratios declined from the prior year, with the CET1 ratio at 11.47% compared to 13.56% in Q3 2025, and the leverage ratio at 7.64% versus 8.90% previously. Book value per common share reached a record C$17.45, a 6% annual increase.
Management reaffirmed guidance for at least US$3 billion in additional U.S. SRP fundings in fiscal 2027, which would expand the credit asset portfolio by approximately 60%. The bank targets a core non-interest expense run rate of C$19.8 million per quarter in fiscal 2027, excluding C$10 million tied to the DRTC divestiture. Net interest margin is expected to trend toward 2.3% as liquidity conditions normalize.
