From The Motley Fool · Motley Fool Transcribing · · 2m
Old Second Bancorp Q3 2026 Earnings Results
Old Second Bancorp reports strong Q3 2026 earnings with improved credit metrics and strategic partnerships.
In brief
Old Second Bancorp reports strong Q3 2026 earnings with improved credit metrics and strategic partnerships. Old Second Bancorp achieved $28.9 million net income for Q3 2026 with a 5.27% net interest margin and reduced credit risk. Originally reported by The Motley Fool.
Q3 2026 Earnings
Old Second Bancorp reported net income of $28.9 million for Q3 2026, or $0.56 per diluted share.
Net Interest Margin
Net interest margin improved to 5.27% on a tax-equivalent basis, a 4 basis point increase from Q2 2026.
Loan Charge-offs
Net loan charge-offs totaled $12.7 million, primarily from a single commercial relationship and powersport loans.
Classified Loans
Classified loans decreased by $57.8 million to $74.2 million, the lowest level since before the pandemic.
Criticized Loans
Criticized loans declined by $61.3 million, or 38%, to 1.88% of total loans.
Efficiency Ratio
Efficiency ratio stood at 52.34% on a GAAP basis, with an adjusted ratio of 52.06%.
Return on Equity
Return on average tangible common equity reached 15.77% for Q3 2026.
Share Repurchases
Company repurchased 1.5 million shares for $39.5 million, reducing outstanding shares by 3%.
Dividend Increase
Common dividend increased by 14% to $0.08 per share, payable Nov. 9, 2026.
Total Loans
Total loans declined slightly to $5.24 billion due to prepayment activity and portfolio reduction.
Total Deposits
Total deposits decreased by $117.1 million, reflecting seasonal runoff and high-cost deposit attrition.
Allowance for Credit Losses
Allowance for credit losses decreased to $64.2 million, or 1.23% of total loans.
Mortgage Servicing Rights
Mortgage servicing rights increased by $623,000 due to higher market interest rates.
Ducati Partnership
Signed multiyear agreement with Ducati USA to boost loan originations in late 2026 and 2027.
Loan Growth Outlook
Targeted low single-digit growth for Q4 2026, supported by middle market and small business segments.
Repricing Tailwinds
45% of loan book and 25% of securities portfolio expected to reprice within 3-4 quarters.
Here's the gist
Old Second Bancorp achieved $28.9 million net income for Q3 2026 with a 5.27% net interest margin and reduced credit risk.
