Carter Bankshares, Inc. (CARE) Cash Flow Statement

The 2026Q1 spike appears to reflect the $34.1M provision reversal and non-interest income items noted in prior income statement analysis, rather than a durable step-up in earnings power. Excluding that quarter, the underlying run-rate of roughly $5M to $9M per quarter suggests organic capital build is modest relative to the balance sheet. Investors should monitor whether recurring earnings can sustain regulatory capital buffers without reliance on reserve releases.

The large sale-side activity in 2026Q2 and 2026Q3 suggests management has been actively reducing or restructuring the securities portfolio, possibly to fund loan demand or manage unrealized losses in AOCI. Such sales may indicate a shift away from long-duration holdings, though the cash flow data alone cannot confirm the underlying motive. Further investigation of the securities footnote would be needed to determine realized losses and reinvestment yields.

Because provisions are non-cash estimates, their swings flow through net income and distort the operating cash flow to net income relationship, as reflected in erratic OCF/NI ratios ranging from -9.01 to 3.54. This pattern suggests reserve decisions, not operating cash generation, are setting reported earnings. Investors should treat the cash flow statement as secondary here and focus on reserve adequacy and charge-off trends.

The $27.1M repurchase in 2026Q3 is large relative to the $7.8M net income for that quarter, which suggests buybacks were funded from balance sheet liquidity rather than current earnings. Dividend coverage from reported net income appears thin in the most recent quarter, though it looks adequate on a multi-quarter basis. Sustainability of repurchases would depend on whether capital ratios remain comfortably above regulatory minimums.