OSBC

- Old Second Bancorp reported third quarter 2026 results with net interest income of US$84.05 million and net income of US$28.94 million, alongside a completed 3.01% share repurchase tranche and a US$0.08 per share cash dividend declared in October. - The combination of stronger earnings per share, active buybacks totaling US$39.5 million, and a higher quarterly dividend indicates management's focus on per share value and capital return discipline. - We will look at how Old Second Bancorp's sharp third quarter earnings improvement interacts with the existing investment narrative around net interest margin. Compare Old Second Bancorp's income and capital return profile with a hand picked 7 dividend fortresses that show how other issuers are using cash flows to reward shareholders. For an investor in Old Second Bancorp, the core belief is that a high net interest margin, disciplined funding costs and specialty lending can keep supporting earnings, even as credit costs remain a swing factor. The latest quarter shows net interest income of US$84.05 million and net income of US$28.94 million, which supports that earnings power story. The bigger short term catalyst is whether credit quality and net charge offs ease enough for that margin to translate cleanly into profits. Elevated losses in C&I, office CRE and powersports remain the main risk. The fresh results do not remove that issue, but they do not materially worsen it either. The most directly relevant update for that thesis is Old Second Bancorp's completed buyback of 1,533,104 shares for US$39.5 million in the third quarter. Retiring roughly 3.01% of the share count supports per share metrics like EPS and return on tangible equity, as long as the underlying income base holds up. When you pair that capital return with the US$0.08 per share dividend declared on October 20, the story becomes clearer. Management is using a mix of repurchases and cash payouts while working through credit clean up, runoff of higher beta deposits and specialty lending expansion. For you, the key question is whether that capital deployment still feels appropriate given the ongoing credit and regional concentration risks. Old Second Bancorp's analyst blueprint ties the near term story about credit clean up and buybacks to a longer term earnings and revenue path. Forecasts in the latest Simply Wall St report sketch out what needs to happen on both the income statement and the valuation multiple for that narrative to hold together. Consensus assumptions call for revenue to rise at about 1.5% a year over the next three years, with profit margins moving from 27.1% today to 38.8% by around 2029. That margin bridge is what links modest top line expansion to a much higher earnings base, helped by the expected reduction in share count of roughly 3.41% per year as repurchases continue. On the earnings side, analysts project Old Second Bancorp could reach US$138.4 million of profit and US$2.65 in EPS by 2029, compared with US$92.4 million of earnings today. That implies an earnings increase of about US$46 million over the period, which is a meaningful step up in absolute income even before considering the benefit of having fewer shares outstanding. Valuation expectations in the same report link those fundamentals to a P/E reset. The consensus view assumes the stock trades on an 11.4x earnings multiple by 2029, down from 13.6x today and roughly in line with the cited US banks sector P/E of 11.4x. The discount rate applied in the analysis, at around 7.2% to 7.24%, frames what future cash flows need to look like to justify the analyst price targets. Old Second Bancorp's narrative projects US$357.0 million revenue and US$138.4 million earnings by 2029. This requires 1.5% yearly revenue growth and an earnings increase of about US$46.0 million from US$92.4 million today. Price targets in the consensus snapshot cluster around US$28.00 per share, with a high case of US$30.00 and a low case of US$25.00 against a current share price of US$24.66 as of late October 2026. That spread shows some disagreement about how cleanly credit issues will be managed and how much weight to put on the projected margin and earnings uplift. For you as a shareholder or prospective investor, the key practical takeaway is alignment. The analyst model assumes steady but not rapid revenue expansion, higher profitability, and continued buybacks that shrink the equity base. The question to test is whether those building blocks around loan growth, credit costs, and funding mix feel realistic given your own view of Old Second Bancorp's balance sheet and the regional banking sector it operates in. Uncover why Old Second Bancorp's fair value indicates a 14% potential upside to its current price, which could narrow quickly. Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so trust your own analysis and judgment. - A great starting point for your Old Second Bancorp research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision. - See our latest analysis for Old Second Bancorp. The report includes a comprehensive fundamental analysis summarized in a single visual, the Snowflake, making it easy to evaluate Old Second Bancorp's overall financial health at a glance. If you want to put Old Second Bancorp in context and pressure test your thesis, it helps to scan a wider field of opportunities using the Simply Wall St Screener. - Prefer resilient businesses that aim to keep risk in check, even when conditions change quickly? Start with a 30 resilient stocks with low risk scores that can help you focus on more defensively positioned stocks. - If balance sheet strength matters most to you, compare Old Second Bancorp with a curated list of solid balance sheet and fundamentals (23 results) and see which companies align better with your risk tolerance. - Looking for under followed opportunities with robust fundamentals? Use the 18 high quality undiscovered gems to surface candidates that might not yet be widely traded but still meet your quality filters. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include OSBC. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Old Second Bancorp's third quarter results missed Wall Street's expectations, as modest revenue growth was offset by a notable increase in net loan charge-offs. Management attributed the underwhelming performance to a large, previously flagged commercial and industrial credit, which drove higher loan losses. CEO James Eccher emphasized that, despite these challenges, the quarter saw significant improvement in key credit metrics such as reductions in classified and criticized loans. He noted, "We think we have turned the corner… and feel as good about the loan book today as we have in several years." Is now the time to buy OSBC? Find out in our full research report (it's free). - Revenue: $97.42 million vs analyst estimates of $98.18 million (1.2% year-on-year growth, 0.8% miss) - Adjusted EPS: $0.55 vs analyst expectations of $0.58 (5.2% miss) - Market Capitalization: $1.23 billion While we enjoy listening to the management's commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. - Nathan Race (Piper Sandler) asked about the sustainability of lower charge-offs going forward. CEO James Eccher expressed confidence, citing significant reductions in criticized and classified loans and stating, "We think we have turned the corner." - Nathan Race (Piper Sandler) inquired about net interest margin expectations amid increased deposit pricing competition. CFO Bradley Adams explained that the margin could decline by around 5 basis points due to higher funding costs and share repurchases but believes margins will remain above 3.25%. - Nathan Race (Piper Sandler) questioned the bank's future appetite for share buybacks versus M&A. Adams replied that capital is sufficient to continue buybacks while also remaining ready for smaller, strategic acquisitions. - Jeff Rulis (D.A. Davidson) asked whether higher rates are impacting loan demand or credit quality, especially in the powersports segment. Head of National Specialty Lending Darin Campbell said application volumes are up, and Eccher noted that short loan durations and ongoing stress testing help mitigate repricing risk. - Brian Martin (Janney Capital) queried about the expense outlook and whether credit resolution offers a tailwind. Adams responded that while there are always moving parts in expenses, keeping growth in the 3-4% range is a positive achievement given ongoing cost pressures. Looking ahead, the StockStory team will watch (1) whether credit quality improvements are sustained, particularly regarding reductions in criticized and classified loans; (2) the impact of new lending partnerships, especially Ducati USA, on loan growth and originations; and (3) how deposit growth and pricing trends affect net interest margin in a competitive funding environment. Execution on expense discipline and strategic capital deployment will also be key markers of success. Old Second Bancorp currently trades at $24.77, in line with $24.87 just before the earnings. In the wake of this quarter, is it a buy or sell? Find out in our full research report (it's free for active Edge members). WHILE YOU'RE HERE: Top 9 Market-Beating Stocks. The best stocks don't just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses. But our AI platform says the party isn't over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. - Management attributes the quarter's performance to an exceptionally strong net interest margin of 5.27%, driven by higher short-term rates and the repricing of lower-yielding loans. - A significant $12.7 million net loan charge-off was primarily driven by a single commercial relationship in the warehousing and distribution sector that has faced deteriorating cash flow for over a year. - Credit quality metrics showed a major inflection point, with classified loans reaching their lowest levels since before COVID-19 and criticized loans declining by 38% during the quarter. - Loan growth was nominally flat as strong origination activity was offset by outsized prepayment levels and a strategic effort to reduce the syndication portfolio by $53 million. - The efficiency ratio remains a core strength at 52.06%, reflecting strong operating leverage despite modest increases in salary and occupancy costs. - Management emphasized that the bank is now participating at the marginal funding rate as the loan-to-deposit ratio nears its ceiling at 98.3%. - Management expects to give back approximately 5 basis points of net interest margin in the fourth quarter due to increased deposit competition and the cost of share repurchases. - Loan growth for the fourth quarter of 2026 is targeted at low single-digit levels, supported by a broad-based pipeline in small business, middle market, and healthcare sectors. - A new multi-year partnership with Ducati USA is expected to provide a modest lift to originations in late 2026 and a substantial boost throughout 2027. - Approximately 45% of the loan book and 25% of the securities portfolio are scheduled to reprice over the next three to four quarters, providing a potential tailwind to yields. - Expense growth is projected to remain modest in the 3% to 4% range annually, despite anticipated 20% increases in employee health insurance costs. - The company aggressively repurchased 1.5 million shares for $39.2 million in Q3, signaling confidence in its capital position and earnings trajectory. - The common dividend was increased by 14% for the fourth quarter of 2026, reflecting the resilience of the income statement. - Management continues to monitor 'powersport' business charge-offs, which totaled $3.1 million this quarter and are expected to remain a recurring, though manageable, credit factor. - Strategic M&A remains a priority, with management indicating they have sufficient capital to continue both 5% annual share buybacks and 'fill-in' type acquisitions. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. - Management expressed high confidence that they have turned a corner, noting that the single large credit loss is largely behind them as the underlying business is under contract for sale. - They reiterated a normalized charge-off range of 35 to 40 basis points, supported by the fact that classified loans are at their lowest levels in years. - The compression is driven by the loss of free funding from share repurchases and the need to fund new loan growth at marginal market rates. - Management noted that while 50% of the book is variable, the benefit from Fed rate hikes has already been largely realized, leading to a more stable but slightly pressured outlook. - Application volume remains strong and slightly up year-over-year, though the bank has increased its turn-down rate by about 7% due to signs of consumer debt distress. - The bank is seeing significant growth in its electric car financing business and expects the Ducati partnership to provide a substantial boost to originations in 2027. - Management has reduced the syndication book by over 60% since 2021, viewing it as transactional rather than 'franchise enhancing.' - The portfolio now stands at approximately $285 million and is no longer expected to be a material headwind to total loan growth moving forward.

- Interested in Old Second Bancorp, Inc.? Here are five stocks we like better. - Third-quarter net income was $28.9 million, or $0.56 per diluted share, supported by a higher net interest margin and improved credit classifications, though results were partly offset by elevated charge-offs. - Net loan charge-offs totaled $12.7 million, largely tied to one commercial borrower, but classified, nonperforming and criticized loans all declined. Management said the isolated credit issue is largely behind the company. - The tax-equivalent net interest margin rose to 5.27%, and management expects low-single-digit loan growth in the fourth quarter while remaining active in share repurchases and targeting annual buybacks of roughly 5% of outstanding shares. Old Second Bancorp (NASDAQ:OSBC) reported third-quarter 2026 net income of $28.9 million, or $0.56 per diluted share, as a higher net interest margin and improving credit classifications were partly offset by elevated loan charge-offs tied primarily to one commercial relationship. On an adjusted basis, excluding mortgage servicing rights valuation adjustments, the company earned $28.5 million, or $0.55 per diluted share. Return on assets was 1.69%, while return on average tangible common equity was 15.77%. The company reported a 52.34% efficiency ratio for the quarter. → Aurora Rejects Curaleaf's Higher Bid, But the Takeover Fight Isn't Over "Despite the isolated charge-off, it was a pretty solid quarter for the company," Chairman, President and Chief Executive Officer Jim Eccher said. He added that the bank's improving credit metrics and performance across the rest of its operations left management optimistic about the outlook. Third-quarter results included $12.7 million of net loan charge-offs. Commercial and industrial charge-offs totaled $9.2 million, with $6 million of that amount previously reserved. The bulk of the C&I losses related to a warehousing and distribution borrower whose cash flow deteriorated over the past year. → Could Quantinuum's Breakthrough Make Its Sell-Off a Bargain? Eccher said the company believes that credit is "largely behind us," noting that the borrower is under contract to be sold at a lower price. The remaining $3.1 million of charge-offs came from the company's powersport portfolio, a level comparable with the preceding quarter. Management pointed to broad improvement in other credit indicators. Classified loans declined to $57.8 million, nonperforming loans fell to $16.8 million, and criticized loans decreased by $61.3 million, or 38%, during the quarter. Eccher said classified loans as a percentage of total loans had not been this low since before the COVID-19 pandemic. → IonQ's Bold Expansion Could Leave Shareholders Paying the Price The allowance for credit losses on loans declined to $64.2 million, or 1.23% of total loans, at Sept. 30, from $70.4 million, or 1.34% of loans, at the end of the second quarter. Chief Operating Officer and Chief Financial Officer Brad Adams said the reserve reduction largely reflected the decline in classified loans, though he does not expect a substantial additional reduction because the company expects to replenish reserves for recurring powersport charge-offs. Net interest income rose to $84 million in the third quarter from $83.3 million in the prior quarter and increased $1.3 million from a year earlier. The tax-equivalent net interest margin expanded 4 basis points sequentially to 5.27%, up 22 basis points from the prior-year quarter. Loan yields rose 3 basis points during the quarter, while the total yield on earning assets increased 6 basis points to 6.40%. The cost of interest-bearing deposits increased 2 basis points, and total cost of deposits was 1.02%, compared with 1.00% in the second quarter and 1.33% a year earlier. Average loans increased by $5.5 million, while average deposits fell by $78 million. Adams attributed the deposit decline largely to seasonal factors, remaining runoff in higher-beta deposits, and wholesale deposits obtained through prior acquisitions. Management said loan originations were stronger than reported balances suggested, but higher prepayments and the deliberate reduction of the syndicated loan portfolio offset production. Loan prepayments through the first nine months of 2026 had already reached the full-year 2025 total, according to Adams. Old Second expects low-single-digit loan growth in the fourth quarter. Adams said the company could give back roughly 5 basis points of margin as loan growth requires more marginal funding and deposit competition increases, but added that he expects the bank to remain above a 5.20% margin in the near-to-intermediate term. About 45% of the loan portfolio is expected to reprice over the next three to four quarters, Eccher said, along with roughly 25% of the securities portfolio. Adams said about half of the loan portfolio is variable rate and generally reprices with a 30-day lag. Total loans declined by approximately $7.8 million during the quarter, while the loan-to-deposit ratio rose to 98.3% from 96.4% in the prior quarter. Eccher said outsized payoffs and a $53 million reduction in the syndicated loan portfolio constrained reported loan growth. The company has reduced its syndicated loan balances by more than 60% from the end of 2021, when the portfolio peaked at $550 million. Adams said the company will continue participating in some syndicated credits but no longer views the business as a primary strategic focus. Management said commercial loan pipelines were broad-based, with activity in small business, middle market, C&I, healthcare, investment commercial real estate, sponsored lending and investment leasing. Eccher said the fourth-quarter pipeline was shaping up as one of the company's strongest in a long time and could support a strong start to 2027. In national specialty lending, Head of National Specialty Lending Darin Campbell said application volumes were modestly higher than a year earlier, while underwriting standards had led the company to decline more applications due to higher consumer debt burdens. He said originations remained similar to the prior year and collector car lending was up significantly. Campbell also said Old Second recently launched a multiyear endorsed agreement with Ducati USA. He said the arrangement had generated positive dealer feedback and initial application flow, with management expecting it to support fourth-quarter originations and provide a more substantial boost in 2027. Adams said he expects deposits to grow in the fourth quarter and believes most post-acquisition deposit attrition is now behind the company. Old Second repurchased 1.5 million shares during the third quarter for approximately $39.2 million. Through the first nine months of 2026, the company repurchased 3.4 million shares at an average price of $22.74, representing a $74.7 million reduction in equity. The repurchases contributed to a modest decline in tangible book value per share to $14.75 from $14.77 in the prior quarter and reduced the tangible equity-to-tangible assets ratio to 11.0% from 11.19%. Adams said the company expects to remain active in buybacks, citing its capital position and earnings outlook. He said investors could reasonably expect Old Second to repurchase about 5% of its shares annually while retaining the capacity for smaller, "fill-in" acquisitions. The company increased its common dividend by 14% in the fourth quarter of 2026. Management said it continues to evaluate acquisition opportunities, although Adams characterized the Chicago-area market as active but not more robust than it was a year ago. Noninterest expense increased $370,000 from the second quarter, driven by compensation, incentive, employee insurance, occupancy and equipment costs. Adams said management expects expense growth of roughly 3% to 4% annually, despite pressure from projected increases in health care costs. Old Second Bancorp, Inc is a bank holding company headquartered in Aurora, Illinois. Through its principal subsidiary, Old Second National Bank, the company provides banking and financial services to individuals, families, businesses and governmental entities. Its offerings include checking and savings accounts, certificates of deposit, residential and commercial real estate lending, commercial and industrial loans, consumer loans, treasury management and cash-management services. The bank also provides wealth management, trust and investment-related services through its financial services operations. Founded in 1871, Old Second has a long history of serving communities in northern Illinois, including the Fox Valley and Chicago metropolitan area. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Old Second Bancorp Q3 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for October 2026.

Image source: The Motley Fool. Thursday, Oct. 22, 2026 - Chairman, President, and Chief Executive Officer - James L. Eccher - Chief Operating Officer and Chief Financial Officer - Bradley S. Adams - Head of National Specialty Lending - Darin Campbell Operator: Good morning, everyone, and thank you for joining us today for Old Second Bancorp Inc. Third Quarter 26 Earnings Call. On the call today are Mr. James L. Eccher, the company's chairman, president, and chief executive officer. Mr. Bradley S. Adams, the company's chief operating officer and chief financial officer. And Mr. Darin Campbell, the company's head of National Specialty Lending. I will start with a reminder that Old Second's comments today will contain forward-looking statements about the company's business, strategies and prospects, which are based on management's existing expectations in the current economic environment. These statements are not a guarantee of future performance and results may differ materially from those projected. Management would also ask you to refer to the company's SEC filings for a full discussion of the company's risk factors. The company does not undertake any duty to update such forward-looking statements. On today's call, we will also be discussing certain non GAAP financial measures. These non GAAP measures are described and reconciled to their GAAP counterparts in the earnings release, which is available on our website at oldsecond.com. On the home page and under the investor relations tab. Now I would like to turn the call over to Mr. Jim Eccher. James L. Eccher: Okay. Good morning, and thank you for joining us. As customary I have several prepared opening remarks, give you my overview of the quarter, then turn it over to Bradley for additional details. I will then conclude with certain summary comments and thoughts about the future. Before we open it up to questions. From a GAAP perspective, net income was $28.9 million or $0.56 per diluted share in the third quarter Return on assets was 1.69%. Third quarter 26 return on average tangible common equity was 15.77% and the efficiency ratio is 52.34%. Excluding all adjusting items, which for the quarter was limited to MSR valuation adjustments, Net income for the third quarter was $28.5 million or $0.55 per diluted share. Third quarter 26 earnings were impacted by $12.7 million of net loan charge offs, which consisted of commercial and industrial loan net charge offs of $9.2 million primarily related to 1 relationship we have discussed on prior calls, $6.0 million of that $9.2 million was previously reserved for. This credit is a warehousing and distribution business that has seen its cash flow position deteriorate over the last year. We feel this credit is now largely behind us. The remaining portion of the charge off is related to the powersport business, which totaled $3.1 million, which is comparable to the prior quarter powersport charge off level. Tangible book value per share declined slightly to $14.75 as of September 30 from $14.77 as of June 30. And the tangible equity to tangible asset ratio decreased 19 basis points from last quarter from 11.19% to 11%. The modest declines in these metrics are primarily due to stock repurchases of approximately $39.5 million and a change in the value of the securities portfolio due to higher rates during the quarter. Our financials reflect an exceptionally strong net interest margin at 5.27%. For the third quarter 26. that is a 4 basis point improvement from last quarter and 22 basis point increase over the prior year on a tax equivalent basis. Pre provision net revenues increased in the third quarter of 2026 from the prior quarter primarily due to day count. Slightly higher average loan balances, and lower average savings and time deposit balances. Total cost of deposits was 102 basis points for the third quarter compared to 100 basis points for the prior linked quarter and 133 basis points for the third quarter 2025. The third quarter of 2026 compared to last quarter, tax equivalent income on average earning assets increased and interest expense on average interest bearing liabilities increased nominally. Loan to deposit ratio is now 98.3% as the end of the third quarter compared to 96.4% last quarter and 91.4% as of September 30, 2025. Total loans declined nominally about $7.8 million during the third quarter, Tax equivalent loan yields increased 3 basis points during the quarter compared to the linked quarter, but reflected a 1 basis point decrease for the quarter year-over-year. The increase in yield in comparison to the prior quarter was driven by higher short term rates, and repricing of lower yielding loans. We expect this to continue in the near term. Turning to credit. Asset quality trends improved significantly during the quarter excluding the elevated charge offs resulting from the single credit we just discussed. Classified loans decreased $57.8 million and non performing loans decreased $16.8 million. Criticized loans, an early indicator of stress, declined by $61.3 million or 38% during the quarter. As a percentage of loans, classified loans have not been this low since before COVID. Needless to say, we are extremely pleased with the credit trajectory and its implication for future quarters. The allowance for credit losses on loans was $64.2 million as of September 30, or 1.23% of total loans. from $70.4 million at the end of the second quarter, which was 1.34% of loans. Unemployment and GDP forecast views and future loss rate assumptions remain fairly static from last quarter, with no material changes in the unemployment assumptions on the upper end of the range based on recent Fed projections. Non-interest income declined $191 thousand in the third quarter of 2026 compared to the prior linked quarter and nominally from the prior-year linked quarter. Wealth management continues to reflect strong performance and growth quarter-over-linked-quarter and prior-year linked quarters. Mortgage banking income increased $436 thousand compared to the linked quarter, and increased $762 thousand compared to the like period. Like prior year period, primarily due to the changes in mortgage servicing rights marked to market valuations. MSR mark to market valuations increased $775 thousand quarter-over-linked-quarter. and $1 million over the prior year period. Total non interest expense for the third quarter of 2026 increased $370 thousand from the prior linked quarter driven by higher regular salaries, higher officer incentive, and employee insurance costs within salaries and employee benefits. An increase in occupancy furniture and equipment due to continued capital projects and growth in real estate taxes and office equipment cost. These increases were partially offset by a decrease in other expense from several 1-off expenses in the prior quarter. Our efficiency ratio continues to be excellent, as the tax equivalent efficiency ratio adjusted to exclude core deposit intangibles OREO cost, and the adjustments to net income as noted earlier, was 52.06% for the third quarter compared to 50.8% for the second quarter. Overall, the company continues to perform at an exceptionally high level, Operating leverage is strong. The margin is largely stable, and feed businesses are performing well. The improvement in key credit metrics, including reductions in classified and criticized during the third quarter, will allow us to finish the year over the next quarter in a much better position. To demonstrate the full earnings power of Old Second. I will now turn it over to Bradley for more color. Bradley S. Adams: Thanks, Jim. Net interest income increased to $84.0 million relative to last quarter at $83.3 million. also increased $1.3 million from last year. Loan yields increased 3 basis points while securities yields declined 5 basis points in the third quarter. Total yield on earning assets increased 6 basis points over the linked quarter to 640 basis points. Cost of interest bearing deposits increased modestly at 2 basis points total cost of interest bearing liabilities increased 1 basis point to 1.74%. The end result was a 4 basis point increase in the tax equivalent NIM to 27, versus 23 last quarter. Obviously, we believe this continues to be exceptional margin performance. Average loans increased $5.5 million, or only 0.1%. Over linked quarter and average deposits, however, decreased by $78 million or 1.4% Other runoff is largely seasonal this quarter, with some residual runoff and high beta effectively wholesale deposit captions. Origination activity in the third quarter was much better than it appears and in line with budget. But was offset by significant pay down and pay. payoff activity Loan prepayments through the first 3 quarters have already reached full year 2025 levels. Certainly, the market environment, including ongoing interest rate volatility, and due to high energy prices, broad based inflation has resulted in outsized payoffs, it appears to us. Lending teams are continuing to work very hard and pipelines for the fourth quarter are building, which should also bode well. for the first quarter of 2027 as well. From a stock repurchase perspective, we acquired 1.5 million shares during the third quarter. Resulting in a reduction to equity and a growth in treasury stock of $39.2 million Year to date repurchases total 3.4 million shares at an average price of $22.74. that is a $74.7 million reduction in equity This has a negative impact on the net interest margin, obviously, but positive impact on earnings per share. We do expect to continue being active in the repurchase shares given our extremely strong capital position and current and expected earnings trends. In addition, based on the strength of the balance sheet and resilient income statements trends, Old Second elected to increase the common dividend in the fourth quarter of 2026 by 14%. As we continue to deliver growth commensurate with the bank's performance. Overall, margin trends still feel very good. Obviously, rates along the curve went up quite a bit. With recent instability in The Middle East and previous expectations for rate cuts have reversed course to under rate hikes. If those trends remain stable from here and high cost deposit attrition slows, I would expect to maintain exceptional margin performance. I do believe at this point, however, that we are likely to give back 5 basis points or so with our current loan growth expectations and the rapid rise we have seen in deposit competition recently. Loan growth in the fourth quarter of 2026 is being targeted in the low single level. Expense growth will continue to be modest in the quarters ahead. that is it from my view, and I will turn the call back over to Jim. James L. Eccher: Thanks, Bradley. In closing, we feel despite the isolated charge-off, it was a pretty solid quarter for the company. We are optimistic due to the improvement in credit metrics this quarter. And the rest of the bank is performing ahead of our expectations. We remain positive about loan growth opportunities and the potential for more strategic growth opportunity as well. That concludes our prepared comments this morning. So I will turn it over to the moderator and open it up for questions. Operator: Confirmation tone will indicate your line is in the question queue. And you may press star 2 if you would like to remove your question from the queue. It may be necessary to pick up your handset before pressing the star keys. 1 moment, please, while we poll for questions. Thank you. Our first question today is coming from Nathan Race with Piper Sandler. Your line is live. Nathan Race: Hey, guys. Good morning. Thanks for taking my questions. James L. Eccher: Morning, Nate. Nathan Race: Jim, obviously, you know, a disappointing charge-off number. Obviously, you mentioned you had this, you know, previously allocated for And, we have been through several quarters with, you know, some credit noise, But just given the reductions in both nonperformers and criticized loans in the quarter, can you just help us in terms of your degree of confidence that we are now in a position today where we can expect charge-offs to be consistently lower. I think we have talked about a range of maybe 35 to 40 basis points as kind of a Yep. Normalized range going forward. But can you just talk to kind of your degree of confidence that we can expect that to unfold going forward? James L. Eccher: Sure, Nate. Yeah. I mean, this is obviously the 1-- the 1 charge-off, this has been a lingering credit that we have been working out for the better part of a year. We have-- the company is under contract to be sold, albeit at a much lower price. So it is we feel we have got this now largely behind us. Think what we are most encouraged about, Nate, is that significant reductions in classifieds and even special mention we have got to go back to October 2019. Way before COVID to have classifieds at this level. So we think we have turned the corner an inflection point with a lot of this credit and understanding we are. We are going to have a certain degree of powersport charge offs on quarter over quarter, but we feel as good about the loan book today as we have in several years. Nathan Race: Okay. Great. that is helpful. And, Bradley, a little surprised to hear your comments around, giving back 5 bps of margin in the fourth quarter, just given how low beta your deposit franchise has historically been. You know, I appreciate deposit pricing competition's increasing these days, but just given how much repricing you have in assets tied to short term rates, curious if you can kind of just unpack some of that a bit. Just in terms of what your beta expectations are. For the fourth quarter. And, again, if you could remind us what kind of you have repricing on the left side of the balance sheet. Tied to short term rates. Bradley S. Adams: So there is a couple things going on. What I would say from the expectation of giving back a few basis points the drivers of it. 1 is how many shares we have repurchased. Obviously, we. We are giving up a fair amount free funding in order to do that. That has a negative implication. The other thing is the loan to deposit ratio is pretty much nearing the ceiling at this point. So for the first time in a while, we are participating at the marginal funding rate relative to our loan growth expectations. And I think that is probably the biggest driver in what I am talking about. There are, as you point out, things on the other side that are to the good. You know, at any given time, 50% of our of our book is variable. And generally, it reprices with a 30 day lag, and then we move relative to SOFR but SOFR is ahead of what the Fed's been doing, and that rate's been high for a while. So we have been seeing that benefit for quite some time. That being said, we do have some. Jim was positively giddy the other day talking about this 3.5% commercial real estate loan that repriced in the 45% of our loan book is going to reprice in the next 3 to 4 quarters. 25% of our securities portfolio is going to reprice at the same time. So there will be some tailwind there. The net of all that is we are going to hang out pretty high at these levels, but you know, guessing within plus or minus 5 basis points Clearly, I have been pretty bad at it over the last year or so, but I have been bad on the right side of it. So maybe I am hedging a bit. Maybe I am right. I still think we are we are solidly above a 25 margin for the near and intermediate term. Nathan Race: Okay. Great. And then do you guys just kinda speak to just the buyback appetite? Obviously, really stepped up on the buybacks in 3Q and over the course of this year. You know, to what extent do you guys wanna continue down the path at similar clip to what we have seen recently? And, within that context, curious, you know, how you wanna balance buybacks with perhaps an acquisition at some point, perhaps sometime next year. Bradley S. Adams: I have plenty of capital to do both, Nate. I mean, as you can see, even this quarter, we did not shrink capital, and we bought back 3% of shares. I think it is reasonable for investors to expect us to take out 5% of shares a year and still have the ability to execute on the type of M&A that we are looking for. Which as we have talked about in the past is relatively smaller than, you know, what we have talked about a couple of years ago. it is kind of fill-in type stuff is, from our perspective, is where the value would be at this point. Nathan Race: Okay. that is really helpful. I will step back. Thanks, guys. James L. Eccher: Yep. Thanks, mate. Operator: Thank you. Our next question is coming from David Konrad with KBW. Your line is live. Analyst: Hey. Good morning. James L. Eccher: Good morning. So loans were roughly flat this quarter with prior prepayments. And I think you said the outlook is low single digit growth from here. But I was just curious how the pipeline's looking and where you expect to see that growth in the coming quarters? Yeah. I think Brad pointed out in his comments that loan production was better than maybe what the results showed. I mean, it is probably 1 of those stronger quarters in the last 6, 7 quarters. I think what we saw was outsized prepayments, 2x of what we would normally see in a quarter. Couple that with the fact that we have been actively trying to work down our syndications portfolio As you know, we have had a significant syndication portfolio come over with West Suburban. We reduced that $53 million this quarter alone. So had we not had that and the outsized payoffs, we would have had a really good quarter. As far as the pipeline is concerned, as a. As of right now, it is looking like 1 of the more solid fourth quarters we have had in a long time, and we are optimistic we are going to get out of the gates pretty well in the first quarter of next year as well. that is helpful. Appreciate it. that is it for me. Thank you. Operator: Thank you. Our next question is coming from Jeff Rulis with D.A. Davidson. Your line is live. Jeff Rulis: Thanks. Good morning. Wanted to kind of maybe jump off of the loan demand and higher rates. I guess, initially, you are seeing any pullback on the consumer power sports from a loan demand standpoint, is that any impact that you are seeing out there? James L. Eccher: Yep. Yeah. Darin Campbell: This is Darin Campbell. Yeah. No. We are not seeing any pullback at this point. Application volume for us this year is up a little bit over last year from that. Application process. I will say we have turned down more applications this year. Compared to last year just for consumer distress. So we. We are accounting for more debt that is we are seeing on credit reports. So we have turned down, as I said, about 7%, but originations is very similar to the same time last year. Applications is up a little bit. So overall, strong. Our electric car business is actually up quite a bit. This year as well, so we are seeing a lot of demand in that area. as well. So overall good. Yeah. James L. Eccher: Jeff, I think you look at the commercial bank, our pipeline build right now is pretty broad based. We are seeing it building in small business, middle market, C and I, health care. Investment CRE, and even sponsored investment leasing. So we are as pleased as we could be with. And normally, fourth quarter is pretty soft, but pipelines are really pretty good right now. Jeff Rulis: Appreciate that. And I guess the other side of that is I think, Jim, you noted that nice to see the benefit of repricing in the book. The flip side of that is any thoughts on just kind of repricing risk on the credit side as maybe higher rates as customers face that I guess, color on are you helping with borrowers in terms of that repricing risk potentially? James L. Eccher: Yeah. I mean, keep in mind our loan book you know, it is very short duration. So, you know, a significant part of some of these credits have already been in a higher rate environment, but you know, we stress test you know, constantly We have, you know, we feel you know, early stage indicators are low. And no concerns at this point. Darin, you want to add anything on the consumer side? Darin Campbell: I think. Yeah. Brian, just 1 other thing that is worth mentioning on the call, we are very excited to announce that we signed a multiyear endorsed agreement with Ducati USA. So we have been working on for quite some time to get to the finish line. That partnership was announced and launched last week. The dealer feedback that we have received from the dealer network has been tremendous. The application flow has already started to come in. So that is been exciting. And as we think about growth going forward even in our fourth quarter, this will give us a little lift for the fourth quarter. But if you think about 2027, there will be a substantial boost for us in originations next year. And Ducati is 1 of the, you know, the best motorcycle brands that is in the market. So we could not be more excited about this opportunity for us. Jeff Rulis: Okay. Sounds good on the production side. But, again, on Jim, the credit and the repricing on the credit front, Feel good about that given the short duration. Bradley S. Adams: Yeah. This is Bradley. I think what you have seen from us in terms of the spike in classified and criticized over the past 3 years has been that very thing. Got it. But, yeah, I think it is pretty safe to say we are through that. Jeff Rulis: Okay. Fair enough. Thanks. Operator: Our next question is coming from David Konrad with Raymond James. Your line is live. Analyst: Hey. Good morning, guys. Thanks for taking my questions. I am filling in for David Konrad. A lot of my questions have been asked and answered, but maybe just on deposits. You have been talking about optimizing your deposit base. Really since the Evergreen acquisition closed to more resemble the legacy old second deposit base. We saw another step down in deposits this quarter, and you specifically called out the runoff of higher cost funding acquired from Evergreen. So I am just wondering how much work is left to do on that front and should we expect to see further deposit runoff in the coming quarters? Bradley S. Adams: I think you will see deposit growth in the fourth quarter. And I think that most of the attrition post that acquisition is largely behind us. My expectation would be the deposits would grow from here. Some of that will come at a little bit more rate. And, obviously, we remain on the lookout, to supplement our deposit base through M&A activity as well. Great. Thanks, Graham. Analyst: Yep. Operator: Our next question is coming from Brandon Rudd with Stephens Inc. Your line is live. Analyst: Morning. Thanks for taking my questions. The first 1, maybe kind of an adjacent question to a prior 1. Just on the reserve, it is come down for the past few quarters now. Are there any remaining specific allocations within that? Or is this 1.23% kind of the steady state you anticipate going forward? Bradley S. Adams: Yeah. I mean, we. there is certainly some reserve allocations built into the portfolio, but I think the drawdown in that reserve is largely reflective of the fact that our classified have come down significantly. Right? Right. We will not run much lower from here just due to the fact we will continually have to replace you know, power sports charge offs quarter over quarter, but I do not see a majority drawdown of reserves at this moment. Okay. Perfect. Thank you. And then just 1 on expenses. It came in a touch higher than what we had in our model. Is this, like, 51.5 million a good expectation for the near term? And then growing, you know, 3% to 4% annually after that? Yep. Yep. That makes perfect sense. Alright. Thank you very much. Thanks, Bradley. Operator: Thank you. As a reminder, ladies and gentlemen, if you do have a question, please press 1 on your telephone keypad. Our next question is coming from Brian Martin with Janney Capital. Your line is live. Brian Martin: Hey. Good morning, guys. James L. Eccher: Hey, Brian. Hey, Brian. Brian Martin: Bradley. Maybe just 1 follow-up on the expense 1. Just the resolution of some of these credits that you have gone through the last couple quarters, is that a tailwind to the expense line? I mean, I get your comments about the outlook, but is that the reason, I guess, maybe we get a little improvement or if there is any on the on the expense side? Bradley S. Adams: So, I mean, that is the big delta between kind of the way you look at things and the way I look at things, Brian. Is there is always ins and outs and what have you in every quarter and this quarter, for example, our third party expenses are elevated. Next quarter, it will be something else. But there is always stuff coming and going. And I look at it much more granularly than probably it appears. Like, my income statement has, like, 42 captions for expenses, and yours has, like, 4. But there is always stuff moving around. I think that you know, in a world where inflation in any real sense is probably between 4 and 5, being in that 3 to 4 range is a pretty good thing given I mean, I do not know if you have noticed. Your employer's probably cutting your health care benefits and increasing your cost, but our costs are projected in that caption to be up pretty close to 20% next year. it is shocking. So there is a lot of things going on, and I actually feel like that 3 to 4% range is doing pretty damn good. And I feel great about it. Yeah. Brian Martin: that is what I meant, Bradley. I guess it seems like you will have other stuff. This gives you a little bit of a tailwind or at least a little help to offset some of those other items. Bradley S. Adams: So just I mean, it helps us deliver on that. On that guidance I just gave for sure. Yeah. I would not expect. I think we are doing a lot of heavy lifting to be at that level. Is the point I would like to make. Gotcha. that is clear. Thank you, Bradley. Brian Martin: And then just on the opportunity set on-- I know you talked about strategic opportunities, Jim. Just the opportunity set in terms of what is out there. Are you seeing more opportunities today? Are there less out there today? Just kind of how's the environment on opportunities in the market. Yeah. James L. Eccher: I mean, Brian, you know Chicago as well as anybody who is been a handful of transactions obviously announced. And, you know, we continue to have conversations. I would not say it is more robust now than it was a year ago. They are active and ongoing. We are hopeful, you know, we are hopeful an opportunity arises next year. Yeah. Okay. Brian Martin: And then the last 2 for me were just the new rates on loans in, I guess, what you are putting on the securities book, Bradley. Just kinda reconcile to those numbers Jim gave in terms of what is repricing here. What are new rates on securities you are thinking about? Is it kind of 5% ish and then on loans? I am-- Bradley S. Adams: I am not adding the securities book at this point given where we are in deposit competition. It would be largely static in terms of what you would see there. If there are you know, flows coming out, we will be replaced at similar rates. So I would not expect any real movement in the securities book. In terms of loans, you know, it. it is still in the kind of mid-6%s type range would be my guess. Okay. Brian Martin: Gotcha. And then the last 1 was just on the syndication book. I know you mentioned it is been running off, Jim, obviously. Just where it stands today, and I guess if that runoff is just gonna continue. it is just a steady decline in that book. Is that how to think about that? James L. Eccher: So it is not gonna really impact the. Yeah. I mean, we are. You know, at our peak, we were $550 million in syndications. We have reduced that by over 60% since the end of 21. Yeah. Roughly $285 million. Will we go to zero? No. it is just not going to be a material part of our balance sheet. We just view that business as transactional, not franchise enhancing type business, but we will continue to do some of it. it is just not gonna be a primary focus. Brian Martin: Okay. And the payoffs will just. You know, I guess that is what I was getting at. The payoffs will not be a major factor in terms of as we go forward here. Like, maybe it has been as you wound it down. It will not be as much of a headwind as it has been. James L. Eccher: You are correct. Yeah. Okay. Brian Martin: that is all I had, guys. Thanks for the calls. Or the questions. James L. Eccher: Yep. Thanks, Brian. Thanks, Brian. Operator: Thank you. Ladies and gentlemen, if you do have any final questions or Okay. As there are no further questions on the lines at this time, I would like to turn the call back over to Mr. Jim Eccher for any closing remarks. James L. Eccher: Okay. Thanks, everyone, for joining us this morning. Look forward to talking to you again next quarter. Goodbye. Operator: Thank you. Ladies and gentlemen, this does conclude today's call. You may disconnect your lines at this time. And we thank you for your participation. Before you buy stock in Old Second Bancorp, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Old Second Bancorp wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $350,756!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,363,905!* Now, it's worth noting Stock Advisor's total average return is 922% — a market-crushing outperformance compared to 213% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of October 22, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Old Second Bancorp (OSBC) Q3 2026 Earnings Call Transcript was originally published by The Motley Fool

This article first appeared on GuruFocus. - Net Income (GAAP): $28.9 million, or $0.56 per diluted share, in Q3 2026. - Net Income (Adjusted): $28.5 million, or $0.55 per diluted share, excluding MSR valuation adjustments. - Return on Assets: 1.69% for Q3 2026. - Return on Average Tangible Common Equity: 15.77% for Q3 2026. - Efficiency Ratio: 52.34% (GAAP); 52.06% on a tax-equivalent basis adjusted for core deposit intangibles, OREO costs, and net income adjustments, versus 50.8% in Q2. - Net Interest Income: $83.3 million, up $0.84 million from the prior quarter and up $1.3 million year over year. - Net Interest Margin: 5.27% tax-equivalent, up 4 basis points from last quarter and up 22 basis points year over year; management expects to give back roughly 5 basis points going forward. - Total Yield on Earning Assets: 6.40%, up 6 basis points over the linked quarter. - Cost of Deposits: 102 basis points, versus 100 basis points in the prior quarter and 133 basis points in Q3 2025. - Cost of Interest-Bearing Liabilities: 174 basis points, up 1 basis point from the prior quarter. - Net Loan Charge-Offs: $12.7 million, including $9.2 million of C&I net charge-offs (primarily one warehousing/distribution relationship, $6 million previously reserved) and $3.1 million related to the Powersport business. - Provision for Credit Losses (Allowance): $64.2 million, or 1.23% of total loans, down from $70.4 million (1.34%) at the end of Q2. - Classified Loans: Decreased $57.8 million during the quarter. - Non-Performing Loans: Decreased $16.8 million during the quarter. - Criticized Loans: Declined $61.3 million, or 38%, during the quarter. - Total Loans: Declined nominally by about $7.8 million during Q3; average loans increased $5.5 million (0.1%) over the linked quarter; Q4 loan growth targeted in the low single digits. - Total Deposits: Average deposits decreased $78 million, or 1.4%, over the linked quarter, largely seasonal runoff. - Loan-to-Deposit Ratio: 98.3% at quarter end, versus 96.4% last quarter and 91.4% as of September 30, 2025. - Non-Interest Income: Declined $191,000 versus the prior quarter and nominally versus the prior-year quarter; mortgage banking income rose $436,000 linked-quarter and $762,000 year over year, driven by MSR mark-to-market valuations (up $775,000 linked-quarter and $1 million year over year); wealth management showed strong growth. - Non-Interest Expense: Increased $370,000 from the prior quarter, driven by higher salaries, officer incentives, employee insurance, occupancy, furniture and equipment, and real estate taxes, partially offset by lower other expense. - Tangible Book Value per Share: $14.75 as of September 30, down slightly from $14.77 as of June 30. - Tangible Equity to Tangible Assets: 11.00%, down 19 basis points from 11.19% last quarter, primarily due to ~$39.5 million of stock repurchases and securities portfolio valuation changes. - Share Repurchases: 1.5 million shares acquired in Q3 for $39.2 million; year-to-date 3.4 million shares at an average price of $22.74, a $74.7 million reduction in equity. - Dividend: Common dividend increased 14% for Q4 2026. - Warning! GuruFocus has detected 8 Warning Sign with OSBC. - Is OSBC fairly valued? Test your thesis with our free DCF calculator. Release Date: October 22, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. - Old Second Bancorp Inc reported a strong net interest margin of 5.27%, up 4 basis points from last quarter and 22 basis points year-over-year. - Asset quality improved significantly with classified loans decreasing $57.8 million and non-performing loans decreasing $16.8 million. - Criticized loans declined by $61.3 million or 38% during the quarter, reaching the lowest level since before COVID. - The company increased its common dividend by 14% in Q4 2026, reflecting confidence in its financial strength. - Old Second Bancorp Inc has a solid capital position, allowing for continued share repurchases (5% annually) and potential M&A opportunities. - Old Second Bancorp Inc recorded $12.7 million in net loan charge-offs, including $9.2 million from a single commercial and industrial relationship. - Total loans declined nominally by $7.8 million during the quarter, with significant paydowns and payoffs offsetting strong origination activity. - The loan-to-deposit ratio increased to 98.3%, nearing the ceiling and potentially limiting future loan growth without additional deposit funding. - Deposits decreased by $78 million or 1.4% from the prior quarter, partly due to seasonal runoff and high-cost deposit attrition. - The company expects to give back about 5 basis points of net interest margin in Q4 due to share repurchases, deposit competition, and loan growth expectations. Q: Nathan Race of Piper Sandler asked whether, after several quarters of credit noise and the large charge-off this quarter, management is now confident charge-offs will consistently run in the 35-40 basis point normal range going forward.A: CEO Jim Eccher said the lingering credit (a warehousing and distribution business now under contract to be sold at a much lower price) is largely behind us. He pointed to significant reductions in classifieds and special mention loans classifieds are at their lowest level since October 2019, before COVID and said the company has turned the corner and feels as good about the loan book as it has in several years, though some Powersport charge-offs will continue quarter to quarter. Q: Nathan Race of Piper Sandler asked CFO Brad Adams to unpack the guidance for giving back roughly 5 basis points of margin in Q4, given the historically low-beta deposit franchise, including beta expectations and the amount of assets repricing off short-term rates.A: CFO Brad Adams cited three drivers: the large share repurchases (which give up free funding), a loan-to-deposit ratio nearing its ceiling (98.3%) that forces participation at the marginal funding rate, and rising deposit competition. Offsets include about 50% of the loan book being variable and repricing with a 30-day lag off SOFR, plus 45% of loans and 25% of securities repricing over the next three to four quarters. He still expects to stay solidly above a 5.20% margin near and intermediate term. Q: Nathan Race of Piper Sandler asked how aggressively Old Second will continue buying back stock and how it will balance repurchases with a potential acquisition next year.A: CFO Brad Adams said the company has plenty of capital to do both it bought back 3% of shares this quarter without shrinking capital. He said it is reasonable for investors to expect about 5% of shares retired per year while retaining the ability to execute M&A, which would be smaller, fill-in type deals rather than the larger transactions discussed a couple of years ago. Q: Mark Shotley of KBW asked about the loan pipeline and where low single-digit growth is expected to come from in coming quarters, given roughly flat loans this quarter.A: CEO Jim Eccher said loan production was stronger than the results suggest one of the best quarters in the last six or seven but was offset by prepayments running about double normal levels and deliberate runoff of the syndications portfolio inherited from West Suburban, which was reduced by $53 million this quarter. He called the current pipeline one of the more solid fourth quarters in a long time and expects a good start to 2027. Q: Jeff Rulis of DA Davidson asked whether higher rates are causing any pullback in consumer Powersport loan demand or creating repricing risk on the credit side, and whether the bank is helping borrowers manage that risk.A: Head of National Specialty Lending Darin Campbell said application volume is up slightly year over year and originations are similar to last year, though the bank has declined about 7% more applications due to consumer distress visible on credit reports; the Pleasurecraft (powersports) business is up considerably. On credit, he noted the loan book is very short duration, much of it already repriced into a higher-rate environment, and constant stress testing shows low early-stage indicators. CFO Brad Adams added that the classified/criticized spike of the past three years reflected exactly that repricing, and it is now largely through. Q: Jeff Rulis of DA Davidson followed up on loan production, prompting management to discuss new growth initiatives.A: CEO Jim Eccher announced a multi-year endorsed agreement with Ducati USA, launched the prior week, which he said has received tremendous dealer feedback and already generated application flow. It should provide a modest boost in Q4 2026 and a substantial boost to 2027 originations, calling Ducati one of the best motorcycle brands in the market. Q: Ken Cote of Raymond James asked how much work remains in optimizing the deposit base toward the legacy Old Second profile after the Evergreen acquisition, and whether further runoff of higher-cost acquired funding should be expected.A: CFO Brad Adams said most post-acquisition attrition is largely behind us and he expects deposit growth in the fourth quarter, some of it at somewhat higher rates. He added the company remains on the lookout to supplement its deposit base through M&A. Q: Brandon Rod of Stevens Inc asked whether the allowance for credit losses, which has declined for several quarters to 1.23% of loans, still contains specific allocations or is now at a steady state.A: CEO Jim Eccher said some reserve allocations remain in the portfolio, but the drawdown largely reflects the significant decline in classified loans. He does not expect a major further reduction because the bank will need to continually replace Powersport charge-offs each quarter. Q: Brandon Rod of Stevens Inc asked whether roughly $51.5 million in quarterly expenses is a good near-term expectation, growing 3-4% annually thereafter.A: CFO Brad Adams confirmed that guidance. Later, responding to Brian Martin of Breen Capital, he noted third-party expense was elevated this quarter and line items always move around, but with real inflation running 4-5% and health care costs projected up nearly 20% next year, delivering 3-4% expense growth represents significant heavy lifting. Q: Brian Martin of Breen Capital asked about the M&A opportunity set whether more or fewer opportunities exist today and about new rates on loans and securities.A: CEO Jim Eccher said a handful of transactions have been announced and conversations are active and ongoing, but the environment is not more robust than a year ago; he is hopeful an opportunity arises next year. CFO Brad Adams said the securities book is largely static, with runoff replaced at similar rates and no new purchases given deposit competition, while new loan rates are in the mid-6% range. Q: Brian Martin of Breen Capital asked where the syndications book stands and whether runoff will continue as a steady decline or cease to be a material factor.A: CEO Jim Eccher said syndications peaked at $550 million and have been reduced by over 60% since the end of 2021 to roughly $285 million. The bank views the business as transactional and non-franchise-enhancing, will continue some of it but not as a primary focus, and payoffs will no longer For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Old Second Bancorp (OSBC) came out with quarterly earnings of $0.55 per share, missing the Zacks Consensus Estimate of $0.59 per share. This compares to earnings of $0.53 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of -6.78%. A quarter ago, it was expected that this financial holding company would post earnings of $0.54 per share when it actually produced earnings of $0.55, delivering a surprise of +1.85%. Over the last four quarters, the company has surpassed consensus EPS estimates two times. Old Second Bancorp, which belongs to the Zacks Banks - Midwest industry, posted revenues of $97.12 million for the quarter ended September 2026, missing the Zacks Consensus Estimate by 0.93%. This compares to year-ago revenues of $95.88 million. The company has topped consensus revenue estimates two times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Old Second Bancorp shares have added about 28.7% since the beginning of the year versus the S&P 500's gain of 12.7%. While Old Second Bancorp has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Old Second Bancorp was favorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #2 (Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.60 on $98.88 million in revenues for the coming quarter and $2.22 on $387.23 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Banks - Midwest is currently in the top 24% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, First Financial Corp. (THFF), is yet to report results for the quarter ended September 2026. This holding company for First Financial Bank is expected to post quarterly earnings of $2.00 per share in its upcoming report, which represents a year-over-year change of +14.3%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. First Financial Corp.'s revenues are expected to be $73 million, up 11% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Old Second Bancorp, Inc. (OSBC) : Free Stock Analysis Report First Financial Corporation Indiana (THFF) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

AURORA, IL / ACCESS Newswire / October 21, 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 third quarter of 2026. Our net income was $28.9 million, or $0.56 per diluted share, for the third quarter of 2026, compared to net income of $28.2 million, or $0.54 per diluted share, for the second quarter of 2026. Adjusted net income1 was $28.5 million, or adjusted diluted earnings per share1 of $0.55, for the third quarter of 2026, compared to adjusted net income1 of $28.7 million, or adjusted diluted earnings per share1 of $0.55, for the second quarter of 2026. Notable Items2 - Net interest and dividend income was $84.0 million, reflecting an increase of $720,000, or 0.86%. - Net interest margin (NIM) on a fully tax-equivalent basis1 was 5.27%, an increase of four basis points. - Provision for credit losses of $6.8 million compared to $7.5 million, a decrease of $750,000. - Noninterest income was $13.1 million, a decrease of $191,000, or 1.44%, compared to $13.3 million. - Noninterest expense was $51.6 million, an increase of $370,000, or 0.72%, compared to $51.3 million. - Efficiency ratio increased 62 basis points to 52.34%; adjusted efficiency ratio was 52.06%1. - Provision for income tax of $9.8 million, compared to $9.7 million, with an effective tax rate of 25.31% and 25.53%, respectively. - Return on average assets of 1.69%, compared to 1.65%. - Return on average tangible common equity (ROATCE)1 of 15.77%; adjusted ROATCE1 of 15.53%. - On October 20, 2026, our Board of Directors declared a cash dividend of $0.08 per share of common stock, payable on November 9, 2026, to stockholders of record as of October 30, 2026. Chairman, President and Chief Executive Officer Jim Eccher said, "Old Second reported strong results in the third quarter of 2026 led by robust margin performance and disciplined operating efficiency. Loan losses remained higher than we wanted this quarter due to one previously identified commercial relationship, but the trends are extremely encouraging with nonperforming and classified loans declining by 30% and 44%, respectively. Criticized loans, an early indicator of future credit trends, also improved significantly during the quarter and now stand at just 1.88% of total loans, compared to 3.05% last quarter. Criticized assets also declined significantly quarter over quarter, decreasing to 1.91% of total loans from 3.08% in the previous quarter. Profitability remains excellent with the tax-equivalent net interest margin increasing by four basis points this quarter to 5.27%, which demonstrates the benefits of a strong core deposit base and diversified loan portfolio. This level of performance and a strong capital position afforded Old Second the opportunity to repurchase 1.5 million common shares this quarter, or approximately 3% of all outstanding shares. Third quarter return on average assets and return on average tangible common equity were 1.69% and 15.77%, respectively, and the efficiency ratio was a very healthy 52.34%. Based on the strength of the balance sheet and income statement trends, Old Second elected in this fourth quarter to increase the common dividend by 14%, as we continue to regularly deliver dividend growth commensurate with the bank's performance. We are proud of our performance for the quarter, believe we have turned the corner on credit and look forward to delivering solid results to our stockholders for the remainder of the year." Results of Operations: Our net income was $28.9 million, or $0.56 per diluted share, for the third quarter of 2026, compared to net income of $28.2 million, or $0.54 per diluted share. Net Interest Margin continued to be strong and nominal increases in the cost of funds were outweighed by stronger yields on loans during the quarter. - Net interest margin on a fully tax-equivalent1 basis improved four basis points, to 5.27%. - Loan yields increased three basis points on higher average loan balances during the quarter but investment yields decreased five basis points driven by maturities and paydowns of securities. - Cost of funds increased two basis points to 1.23%, driven by higher costs on deposits, discussed below, as well as other short-term borrowings due to higher average FHLB overnight borrowings. Noninterest Income decreased $191,000, or 1.44%, in the third quarter of 2026. - Mortgage banking income increased in the period mainly due to $623,000 of mortgage servicing rights ("MSR") mark to market gains compared to $152,000 of losses in the previous quarter, primarily the result of increased rates during the quarter. - The cash surrender value of BOLI decreased $673,000 in the current quarter primarily due to market rate changes impacting company-owned life insurance, which is included within the same line item. Noninterest Expense increased $370,000, or 0.72%. - Salaries and employee benefits increased $743,000, driven by higher salaries, officer incentive accruals, and employee insurance premiums, partially offset by decreases in payroll taxes and deferred compensation expense due to market interest rate changes. - Occupancy, furniture and equipment increased $166,000 due to an increase in real estate taxes and office equipment maintenance. - Advertising and marketing expense increased $120,000 due to a 2026 brand awareness campaign. - Professional fees increased $257,000 due to consulting and management fees related to the 2026 brand awareness campaign as well as an increase in loan-related legal fees. - Other expenses decreased $868,000 primarily due to decreases in director deferred compensation expense stemming from market interest rate changes, a decrease in litigation expense as two nonrecurring items with limited exposure were recorded in the prior quarter, and a decrease in miscellaneous expenses as the previous quarter included an accrual related to powersport loan gap insurance refunds due to customers related to loan prepayments. - Efficiency ratio for the quarter was 52.34% compared to 51.72% and the adjusted efficiency ratio1 was 52.06% compared to 50.80%. Loans decreased $7.8 million driven primarily by decreases in commercial and commercial real estate - investor. - Total loans were $5.24 billion. - Average loans (including loans held-for-sale) for the third quarter of 2026 totaled $5.23 billion, reflecting an increase of $4.0 million. Credit Quality key performance metrics improved significantly during the quarter, although charge-offs were higher than expected and were concentrated in a single commercial relationship. - Nonperforming loans totaled $39.6 million compared to $56.5 million. The $16.8 million decrease reflects a $17.2 million decline in nonaccrual loans partially offset by a slight increase to loans past due 90 days or more accruing. Nonaccrual changes include $9.1 million of net principal paydowns, $6.2 million of full charge-offs, and $3.3 million of partial charge-offs, partially offset by $1.4 million of additions to nonaccrual. - Nonperforming loans to total loans was 0.76% compared to 1.08%. - Classified loans totaled $74.2 million compared to $132.1 million. - Criticized loans (special mention, substandard and doubtful) to total loans was 1.88% compared to 3.05%. The quarter-over-quarter decrease is driven by a decrease of $3.4 million in special mention loans, a decrease of $17.2 million of nonaccrual loans, and a decrease of $40.7 million in substandard accruing. - Provision for credit losses of $6.8 million was driven by $3.1 million of net charge-offs related to powersport loans, and non-powersport charge-offs were primarily isolated to two commercial loans on a single relationship. Deposits experienced declines in noninterest bearing 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 $5.33 billion, a decrease of $117.1 million, or 2.15%. - Cost of deposits increased two basis points to 1.02% as the cost of NOW, money market, and savings accounts all reflected increases, which were partially offset by a five basis point decline in the cost of time deposits. - Average interest-bearing deposits decreased $55.5 million and average noninterest bearing deposits decreased $22.6 million. Capital decreased due to share repurchases and an increase in accumulated other comprehensive unrealized loss on available-for-sale securities, partially offset by strong net income. - Stockholders' equity decreased $24.3 million primarily due to $3.6 million of dividends declared, an $11.5 million increase in the unrealized losses on securities and swaps due to market interest rate increases, and a $39.2 million increase in treasury stock from share repurchases, net of stock award vestings, partially offset by net income of $28.9 million. - Share repurchases of 1,533,104 shares at an average price paid per share of $25.76 during the third quarter, for a total reduction to capital of $39.5 million, including excise taxes. - ROATCE1 was 15.77% compared to 15.58%. - Tangible common equity to tangible assets1 was 11.00% compared to 11.19%. Cautionary Note Regarding Forward-Looking Statements This earnings release and statements by our management may contain forward-looking statements within the meaning of 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, building capital, credit quality trends, the adequacy of our allowance for credit losses, and future share repurchases. 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 the allowance for credit losses, 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; - adverse developments in the commercial real estate market, including increased vacancy rates, declining property values, or borrower distress, particularly in the office sector, which could result in increased credit losses or require additional provisions; - 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 affected 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 disruptions in transportation, and disruptions caused by widespread cybersecurity incidents. Additional risks and uncertainties are contained in the "Risk Factors" and forward-looking statements disclosures 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, October 22, 2026, at 10:00 a.m. Eastern Time (9:00 a.m. Central Time) to discuss our third 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/2239/54568 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 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 13, found in the full earnings release at www.oldsecond.com under the Investor Relations tab, provide a reconciliation of each non-GAAP financial measure to the most comparable GAAP equivalent. 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, adjusted diluted earnings per share, adjusted return on average assets, net interest income and net interest margin on a fully tax-equivalent basis, our adjusted efficiency ratio, tangible common equity to tangible assets, and return on average tangible common equity, including on an adjusted 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. The tangible measures exclude goodwill and other intangible assets, and management believes they are useful in evaluating our capital adequacy and the return generated on our tangible capital base. 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 14, found in the full earnings release at www.oldsecond.com, under the Investor Relations tab. Financial Highlights | | Quarters Ended | (Dollars in thousands - unaudited) | | September 30, | | | June 30, | | | March 31, | | | December 31, | | | September 30, | | | 2026 | | | 2026 | | | 2026 | | | 2025 | | | 2025 | Balance sheet summary | | | | | | | | | | | | | | | Total assets | | $ | 6,778,591 | | | $ | 6,870,305 | | | $ | 6,849,221 | | | $ | 6,902,675 | | | $ | 6,991,754 | Total securities available-for-sale | | | 978,576 | | | | 1,040,760 | | | | 1,115,443 | | | | 1,090,523 | | | | 1,157,480 | Total loans | | | 5,238,057 | | | | 5,245,870 | | | | 5,185,237 | | | | 5,252,131 | | | | 5,264,505 | Total deposits | | | 5,327,564 | | | | 5,444,688 | | | | 5,564,999 | | | | 5,596,069 | | | | 5,760,250 | Total liabilities | | | 5,900,039 | | | | 5,967,494 | | | | 5,955,924 | | | | 6,005,907 | | | | 6,125,069 | Total equity | | | 878,552 | | | | 902,811 | | | | 893,297 | | | | 896,768 | | | | 866,685 | | | | | | | | | | | | | | | | | | | | | Total tangible assets | | $ | 6,629,195 | | | $ | 6,719,760 | | | $ | 6,697,509 | | | $ | 6,749,787 | | | $ | 6,836,565 | Total tangible equity | | | 729,156 | | | | 752,266 | | | | 741,585 | | | | 743,880 | | | | 711,496 | | | | | | | | | | | | | | | | | | | | | Income statement summary | | | | | | | | | | | | | | | | | | | | Net interest income | | $ | 84,049 | | | $ | 83,329 | | | $ | 81,144 | | | $ | 83,051 | | | $ | 82,775 | Provision for credit losses | | | 6,750 | | | | 7,500 | | | | 9,500 | | | | 3,000 | | | | 19,653 | Noninterest income | | | 13,070 | | | | 13,261 | | | | 12,630 | | | | 12,154 | | | | 13,109 | Noninterest expense | | | 51,622 | | | | 51,252 | | | | 50,210 | | | | 52,935 | | | | 63,163 | Net income | | | 28,940 | | | | 28,179 | | | | 25,585 | | | | 28,787 | | | | 9,871 | Effective tax rate | | | 25.31 | % | | | 25.53 | % | | | 24.89 | % | | | 26.69 | % | | | 24.46 | % | | | | | | | | | | | | | | | | | | | | Profitability ratios | | | | | | | | | | | | | | | | | | | | Return on average assets (ROAA) | | | 1.69 | % | | | 1.65 | % | | | 1.51 | % | | | 1.64 | % | | | 0.56 | % Return on average equity (ROAE) | | | 12.76 | | | | 12.57 | | | | 11.43 | | | | 12.92 | | | | 4.61 | Net interest margin (tax-equivalent) 1 | | | 5.27 | | | | 5.23 | | | | 5.14 | | | | 5.09 | | | | 5.05 | Efficiency ratio | | | 52.34 | | | | 51.72 | | | | 52.40 | | | | 53.98 | | | | 64.46 | Return on average tangible common equity (ROATCE) 1 | | | 15.77 | | | | 15.58 | | | | 14.20 | | | | 16.15 | | | | 6.16 | Tangible common equity to tangible assets (TCE/TA) 1 | | | 11.00 | | | | 11.19 | | | | 11.07 | | | | 11.02 | | | | 10.41 | | | | | | | | | | | | | | | | | | | | | Per share data | | | | | | | | | | | | | | | | | | | | Diluted earnings per share | | $ | 0.56 | | | $ | 0.54 | | | $ | 0.48 | | | $ | 0.54 | | | $ | 0.18 | Tangible book value per share | | | 14.75 | | | | 14.77 | | | | 14.35 | | | | 14.12 | | | | 13.51 | | | | | | | | | | | | | | | | | | | | | Company capital ratios 3 | | | | | | | | | | | | | | | | | | | | Common equity tier 1 capital ratio | | | 13.13 | % | | | 13.28 | % | | | 13.13 | % | | | 12.99 | % | | | 12.44 | % Tier 1 risk-based capital ratio | | | 13.56 | | | | 13.70 | | | | 13.55 | | | | 13.41 | | | | 12.85 | Total risk-based capital ratio | | | 15.05 | | | | 15.26 | | | | 15.64 | | | | 15.46 | | | | 15.10 | Tier 1 leverage ratio | | | 11.99 | | | | 12.05 | | | | 11.88 | | | | 11.70 | | | | 11.21 | | | | | | | | | | | | | | | | | | | | | Bank capital ratios 3, 4 | | | | | | | | | | | | | | | | | | | | Common equity tier 1 capital ratio | | | 13.65 | % | | | 13.72 | % | | | 13.80 | % | | | 13.17 | % | | | 13.14 | % Tier 1 risk-based capital ratio | | | 13.65 | | | | 13.72 | | | | 13.80 | | | | 13.17 | | | | 13.14 | Total risk-based capital ratio | | | 14.63 | | | | 14.77 | | | | 14.88 | | | | 14.22 | | | | 14.39 | Tier 1 leverage ratio | | | 12.05 | | | | 12.05 | | | | 12.09 | | | | 11.49 | | | | 11.45 | 1 See 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. 3 Both 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. 4 The 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. CONTACT: Bradley S. Adams Chief Financial Officer (630) 906-5484 SOURCE: Old Second Bancorp Inc. View the original press release on ACCESS Newswire

Old Second Bancorp (OSBC) reported $97.12 million in revenue for the quarter ended September 2026, representing a year-over-year increase of 1.3%. EPS of $0.55 for the same period compares to $0.53 a year ago. The reported revenue represents a surprise of -0.93% over the Zacks Consensus Estimate of $98.03 million. With the consensus EPS estimate being $0.59, the EPS surprise was -6.78%. While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance. Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance. Here is how Old Second Bancorp performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts: - Net Interest Margin: 5.3% compared to the 5.2% average estimate based on five analysts. - Efficiency Ratio: 52.3% compared to the 51.9% average estimate based on five analysts. - Average Balance - Total interest earning assets: $6.35 billion compared to the $6.45 billion average estimate based on four analysts. - Total nonperforming loans: $39.64 million compared to the $54 million average estimate based on two analysts. - Total Nonperforming Assets: $40.92 million compared to the $54.25 million average estimate based on two analysts. - Total noninterest income: $13.07 million versus $13.34 million estimated by five analysts on average. - Net Interest Income (TE): $84.35 million versus the four-analyst average estimate of $84.82 million. - Other income: $1.43 million versus $1.68 million estimated by four analysts on average. - Wealth management: $3.68 million versus the four-analyst average estimate of $3.76 million. - Service charges on deposits: $3.13 million compared to the $3.11 million average estimate based on four analysts. - Net interest and dividend income: $84.05 million versus the three-analyst average estimate of $84.11 million. - Change in cash surrender value of BOLI: $0.8 million compared to the $1.32 million average estimate based on three analysts. View all Key Company Metrics for Old Second Bancorp here>>> Shares of Old Second Bancorp have returned +1.8% over the past month versus the Zacks S&P 500 composite's +1% change. The stock currently has a Zacks Rank #2 (Buy), indicating that it could outperform the broader market in the near term. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Old Second Bancorp, Inc. (OSBC) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research