Old Second Bancorp, Inc. Reports First Quarter 2026 Net Income of $25.6 Million, or $0.48 per Diluted Share

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AURORA, IL / ACCESS Newswire / April 22, 2026 / Old Second Bancorp, Inc. (the “Company,” “Old Second,” “we,” “us,” and “our”) (NASDAQ:OSBC), the parent company of Old Second National Bank (the “Bank”), today announced financial results for the first quarter of 2026. Our net income was $25.6 million, or $0.48 per diluted share, for the first quarter of 2026, compared to net income of $28.8 million, or $0.54 per diluted share, for the fourth quarter of 2025. Adjusted net income¹ was $26.0 million, or adjusted diluted earnings per share¹ of $0.49, for the first quarter of 2026, compared to adjusted net income¹ of $30.8 million, or adjusted diluted earnings per share¹ of $0.58, for the fourth quarter of 2025.

Notable Items²

Net interest and dividend income was $81.1 million, reflecting a decrease of $1.9 million, or 2.30%.
Net interest margin (NIM) on a fully tax-equivalent basis¹ was 5.14%, an increase of 5 basis points.
Provision for credit losses of $9.5 million compared to $3.0 million.
Noninterest income was $12.6 million, an increase of $476,000, or 3.92%, compared to $12.2 million.
Noninterest expense was $50.2 million, a decrease of $2.7 million, or 5.15%, compared to $52.9 million.
Efficiency ratio improved 158 basis points to 52.40%; adjusted efficiency ratio was 51.70%¹.
Provision for income tax of $8.5 million, compared to $10.5 million with an effective tax rate of 24.89% and 26.69%, respectively.
Return on average assets of 1.51%, compared to 1.64%.
Return on tangible common equity (ROATCE)¹ of 14.20%; adjusted ROATCE¹ of 14.41%.
On April 15, 2026, we paid down $30 million of the total $60 million subordinated debt outstanding and due in 2031.
On April 21, 2026, our Board of Directors declared a cash dividend of $0.07 per share of common stock, payable on May 11, 2026, to stockholders of record as of May 1, 2026.

Chairman, President and Chief Executive Officer Jim Eccher said “Old Second reported strong results in the first quarter of 2026 led by exceptional margin performance and disciplined operating efficiency. Tangible book value per share increased by 1.63% on a linked quarter basis despite the reduction to equity from our stock repurchases of $23.1 million, or 1.2 million shares, during the quarter. Nonperforming assets increased due to a few larger relationships, but we believe we are adequately reserved for any future losses with an Allowance for Credit Losses on loans (“ACL”) to total loans of 1.39% and ACL to nonperforming loans of 95.53%. Credit deterioration in the first quarter largely resulted from one downtown Chicago office credit and one cash-flow-dependent commercial relationship. Otherwise results remain solid with first quarter return on average assets and return on average common equity of 1.51% and 11.43%, respectively. The tax equivalent net interest margin expanded to 5.14% and the efficiency ratio was a very healthy 52.40%. This strong bottom-line performance and a well-positioned balance sheet drove an increase in the tangible common equity capital ratio to 11.07% from 11.02% for the prior linked period. We are proud of our performance from both a bottom-line perspective and in positioning ourselves to deliver better results to our stockholders over the remainder of the year.”

Results of Operations:

Our net income was $25.6 million, or $0.48 per diluted share, for the first quarter of 2026, compared to net income of $28.8 million, or $0.54 per diluted share.

Loans declined $66.9 million driven by decreases in commercial real estate, construction, and powersport.

Total loans were $5.19 billion.
Average loans (including loans held-for-sale) for the first quarter of 2026 totaled $5.21 billion, reflecting a decrease of $70.9 million.
Yield on loans, including loans held for sale, declined 5 basis points.

Credit Quality key performance metrics were impacted by a few larger credits.

Nonperforming loans totaled $75.5 million compared to $52.8 million. The increase of $22.7 million was partially driven by $9.8 million of loans past due greater than 90 days, still accruing, which are in the process of renewal.
Nonperforming loans to total loans was 1.46% compared to 1.01%.
Classified loans totaled $148.6 million compared to $150.1 million.
Criticized loans (special mention, substandard and doubtful) to total loans was 3.64% compared to 3.12%. The quarter-over-quarter increase is driven by an increase of $26.4 million in special mention loans, an increase of $14.7 million of nonaccrual loans driven by one large commercial relationship, partially offset by a decrease of $16.2 million in substandard accruing.
Provision for credit losses of $9.5 million was driven by powersport charge-offs, and larger than normal charge-offs in commercial and commercial real estate; the non-powersport charge-offs were primarily isolated to two loan relationships.

Deposits experienced seasonal declines in savings as well as declines in time deposits as higher rate brokered deposits and other exception-priced time deposits assumed from Bancorp Financial, Inc. rolled off.

Total deposits were $5.56 billion, a decrease of $31.1 million, or 0.56%.
Cost of deposits decreased 10 basis points to 1.05%.
Average interest-bearing deposits and non-interest bearing deposits decreased $119.2 million and $42.9 million, respectively.

Net Interest Margin continued to be strong, and declines in the cost of funds outweighed softer yields during the quarter.

Net interest margin on a fully tax-equivalent basis improved 5 basis points.
Loan yields declined 5 basis points on lower average balances while investment yields increased 4 basis points driven on higher yield outpacing the decline in balance.
Cost of funds declined 8 basis points driven by lower cost of deposits, specifically a 10-basis point decline on the cost of savings accounts, an 11-basis point decline in the cost of money markets, and a 16-basis point decline in the cost of time deposits.

Noninterest Income increased $476,000, or 3.92%, in the first quarter of 2026, excluding mark to market losses on MSR and changes in BOLI cash surrender values, the change was nominal.

Card related income declined in the period due to a reduction in debit card related fees based on seasonally lower transaction volume.
Other income growth in the period was driven by an increase in powersport related loan servicing fees and dealer charge-back income.

Noninterest Expense decreased $2.7 million or 5.15%.

$1.3 million decrease in salaries and employee benefits, driven by declines to salaries, officer incentive accruals, and insurance premiums, partially offset by increases in payroll taxes and 401K company match on 2025 incentive payments paid in 2026.
$1.4 million decrease in computer and data processing due to prior quarter acquisition-related core conversion expenses.
Efficiency ratio for the quarter was 52.40% compared to 53.98% and the adjusted efficiency ratio¹ was 51.70% compared to 51.28%.

Capital continued to grow due to strong net income.

Stockholders’ equity decreased $3.5 million partially comprised of $3.7 million of dividends declared, a $20.0 million increase in treasury stock from share repurchases, and an increase of $2.4 million in AOCI unrealized losses on securities, partially offset by net income of $25.6 million.
Share repurchases of 1,175,859 shares at an average price paid per share of $19.63, for a total reduction to capital of $23.1 million.
ROATCE¹ was 14.20% compared to 16.15%.
Tangible common equity to tangible assets¹ was 11.07% compared to 11.02%.

Cautionary Note Regarding Forward-Looking Statements

This earnings release and statements by our management may contain forward-looking statements within the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “should,” “anticipate,” “expect,” “estimate,” “intend,” “believe,” “may,” “likely,” “will,” “forecast,” “project,” “looking forward,” “optimistic,” “hopeful,” “potential,” “progress,” “prospect,” “remain,” “deliver,” “continue,” “trend,” “momentum,” “remainder,” “beyond,” “build,” and “near” or other statements that indicate future events or expectations. Examples of forward-looking statements include, but are not limited to, statements regarding the economic outlook, balance sheet growth, and building capital. Such forward-looking statements are subject to risks, uncertainties, and other factors, which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements:

the strength of the United States economy in general and the strength of the local economies in which we conduct our operations may be different than expected;
the rate of delinquencies and amounts of charge-offs, the level of allowance for credit loss, the rates of loan growth, or adverse changes in asset quality in our loan portfolio, which may result in increased credit risk-related losses and expenses;
changes in legislation, regulation, policies, or administrative practices, whether by judicial, governmental, or legislative action;
risks related to pending or future acquisitions, if any, including execution and integration risks;
adverse conditions in the stock market, the public debt market and other capital markets (including changes in interest rate conditions) could have a negative impact on us;
changes in interest rates, which have and may continue to affect our deposit and funding costs, net income, prepayment penalty income, mortgage banking income, and other future cash flows, or the market value of our assets, including our investment securities;
elevated inflation which causes adverse risk to the overall economy, and could indirectly pose challenges to our clients and to our business; and
the adverse effects of events beyond our control that may have a destabilizing effect on financial markets and the economy, such as trade disputes, epidemics and pandemics, war or terrorist activities, essential utility outages, deterioration in the global economy, instability in the credit markets, disruptions in our customers’ supply chains or disruption in transportation, and disruptions caused by widespread cybersecurity incidents.

Additional risks and uncertainties are contained in the “Risk Factors” and forward-looking statements disclosure in our most recent Annual Report on Form 10-K, and Quarterly Reports on Form 10-Q. The inclusion of this forward-looking information should not be construed as a representation by us or any person that future events, plans, or expectations contemplated by us will be achieved. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.

Conference Call

We will host a call on Thursday, April 23, 2026, at 10:00 a.m. Eastern Time (9:00 a.m. Central Time) to discuss our first quarter 2026 financial results. Investors may listen to our earnings call via a live webcast by accessing the link provided below, or alternatively, on the Events section of the Old Second Investor Relations website (https://investors.oldsecond.com/events). Investors are encouraged to register at the webcast link at least 10 minutes prior to the scheduled start of the call.

Webcast URL: https://www.webcaster5.com/Webcast/Page/2239/53807

A replay of the webcast will be available under the Events section of the Old Second Investor Relations website (https://investors.oldsecond.com/events) for up to one year after the earnings call date.

Non-GAAP Presentations

Management has disclosed in this earnings release certain non-GAAP financial measures to evaluate and measure our performance, including the presentation of adjusted net income, net interest income and net interest margin on a fully tax-equivalent basis, and our efficiency ratio calculations on a tax-equivalent basis. The net interest margin on a fully tax-equivalent basis is calculated by dividing net interest income on a tax equivalent basis by average earning assets for the period. Consistent with industry practice, management has disclosed the efficiency ratio including and excluding certain items, which is discussed in the efficiency ratio presentation on page 13 of the full earnings release found at www.oldsecond.com, under the Investor Relations tab.

We consider the use of select non-GAAP financial measures and ratios to be useful for financial and operational decision-making and useful in evaluating period-to-period comparisons. We believe that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding certain expenditures or assets or by adjusting certain items that we believe are not indicative of our primary business operating results or by presenting certain metrics on a fully tax-equivalent basis. We believe these measures provide investors with information regarding balance sheet profitability, and we believe that management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, analyzing, and comparing past, present and future periods.

These non-GAAP financial measures should not be considered as a substitute for GAAP financial measures, and we strongly encourage investors to review the GAAP financial measures included in this earnings release and not to place undue reliance upon any single financial measure. In addition, because non-GAAP financial measures are not standardized, it may not be possible to compare the non-GAAP financial measures presented in this earnings release with other companies’ non-GAAP financial measures having the same or similar names. The tables beginning on page 12 of the full earnings release, found at www.oldsecond.com, under the Investor Relations tab, provide a reconciliation of each non-GAAP financial measure to the most comparable GAAP equivalent.

Financial Highlights

	Quarters Ended
(Dollars in thousands – unaudited)	March 31,			December 31,			September 30,			June 30,			March 31,
	2026			2025			2025			2025			2025
Balance sheet summary
Total assets	$	6,849,221		$	6,902,675		$	6,991,754		$	5,701,294		$	5,727,686
Total securities available-for-sale		1,115,443			1,090,523			1,157,480			1,177,688			1,146,721
Total loans		5,185,237			5,252,131			5,264,505			3,998,667			3,940,232
Total deposits		5,564,999			5,596,069			5,760,250			4,798,439			4,852,791
Total liabilities		5,955,924			6,005,907			6,125,069			4,982,645			5,033,195
Total equity		893,297			896,768			866,685			718,649			694,491

Total tangible assets	$	6,697,509		$	6,749,787		$	6,836,565		$	5,588,090		$	5,613,460
Total tangible equity		741,585			743,880			711,496			605,445			580,265

Income statement summary
Net interest income	$	81,144		$	83,051		$	82,775		$	64,234		$	62,904
Provision for credit losses		9,500			3,000			19,653			2,500			2,400
Noninterest income		12,630			12,154			13,109			10,898			10,201
Noninterest expense		50,210			52,935			63,163			43,419			44,505
Net income		25,585			28,787			9,871			21,822			19,830
Effective tax rate		24.89	%		26.69	%		24.46	%		25.30	%		24.31	%

Profitability ratios
Return on average assets (ROAA)		1.51	%		1.64	%		0.56	%		1.53	%		1.42	%
Return on average equity (ROAE)		11.43			12.92			4.61			12.39			11.76
Net interest margin (tax-equivalent) ¹		5.14			5.09			5.05			4.85			4.88
Efficiency ratio		52.40			53.98			64.46			55.99			56.46
Return on average tangible common equity (ROATCE) ¹		14.20			16.15			6.16			15.29			14.70
Tangible common equity to tangible assets (TCE/TA) ¹		11.07			11.02			10.41			10.83			10.34

Per share data
Diluted earnings per share	$	0.48		$	0.54		$	0.18		$	0.48		$	0.43
Tangible book value per share		14.35			14.12			13.51			13.44			12.88

Company capital ratios³
Common equity tier 1 capital ratio		13.13	%		12.99	%		12.44	%		13.77	%		13.47	%
Tier 1 risk-based capital ratio		13.55			13.41			12.85			14.31			14.01
Total risk-based capital ratio		15.64			15.46			15.10			16.55			16.24
Tier 1 leverage ratio		11.88			11.70			11.21			11.83			11.58

Bank capital ratios ^{3, 4}
Common equity tier 1 capital ratio		13.80	%		13.17	%		13.14	%		14.02	%		13.64	%
Tier 1 risk-based capital ratio		13.80			13.17			13.14			14.02			13.64
Total risk-based capital ratio		14.88			14.22			14.39			14.99			14.58
Tier 1 leverage ratio		12.09			11.49			11.45			11.59			11.27

¹See the discussion entitled “Non-GAAP Presentations” above and the full earnings release, found at www.oldsecond.com, under the Investor Relations tab, that provides a reconciliation of all non-GAAP financial measures to the most comparable GAAP equivalents.

² All comparisons throughout this release are on a linked-quarter basis, unless otherwise noted.

³Both the Company and the Bank ratios are inclusive of a capital conservation buffer of 2.50%, and both are subject to the minimum capital adequacy guidelines of 7.00%, 8.50%, 10.50%, and 4.00% for the Common equity tier 1, Tier 1 risk-based, Total risk-based and Tier 1 leverage ratios, respectively.

⁴The prompt corrective action provisions are applicable only at the Bank level, and are 6.50%, 8.00%, 10.00%, and 5.00% for the Common equity tier 1, Tier 1 risk-based, Total risk-based and Tier 1 leverage ratios, respectively.