Peapack-Gladstone Financial Corp. reported a net income of $15.8 million for the second quarter of 2026, marking a 99% surge compared to the same period last year, according to company earnings data released on July 28, 2026. The New Jersey-based financial institution achieved $86.1 million in revenue, a 23% increase year-over-year, while total deposits expanded by $231 million as management focused on lower-cost funding structures and operational account growth.
Deposit Growth and Funding Structure Improvements
According to Chief Executive Officer Doug Kennedy, the bank’s core deposit expansion reflects improving client relationships and a deliberate shift toward low-cost funding. Of the $231 million added to deposits during the second quarter, 35% originated from noninterest-bearing accounts. Overall, noninterest-bearing accounts accounted for 56% of total deposit growth for the period, strengthening the bank’s liquidity profile.
During the earnings call Q&A session, Kennedy told analysts that Peapack-Gladstone expects to maintain an average deposit growth rate of approximately $200 million per quarter. The wealth management division also contributed to noninterest income diversification, growing 6% since the start of the year. Total loans increased by $236 million, driven by balanced expansion across commercial and industrial (C&I), equipment finance, and commercial real estate (CRE) portfolios.
Asset Quality Pressures and Multifamily Portfolio Adjustments
Despite positive balance sheet growth, Peapack-Gladstone faced rising credit risks during the quarter. Nonperforming assets expanded to $72.2 million, prompting management to initiate foreclosure proceedings on multifamily real estate loans. The multifamily portfolio contracted by $21 million during the quarter and by $58 million on a cumulative basis since the beginning of the year as the bank executed selective portfolio adjustments.
To address potential credit losses, the company set aside $8.1 million in credit loss provisions. Kennedy stated that leadership is closely monitoring the timing of when nonperforming assets will reach a cyclical peak, describing the current elevated risk metrics as an interim adjustment phase aimed at establishing a healthier, higher-yielding loan portfolio over the long term.
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