Old Second announced on October 21, 2026, that third-quarter net interest income totaled $84.05 million against a consensus estimate of $84.76 million. It also declared a 14% increase in its common dividend for the upcoming quarter.
Key Takeaways
- Net interest income narrowly missed consensus, while the fully tax-equivalent net interest margin improved to 5.27%.
- Old Second repurchased 1.5 million shares and declared a 14% quarterly dividend increase.
- Higher-than-anticipated loan losses contrasted with declines in nonperforming and classified loans.
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Old Second earnings reflect margin improvement
The bank’s fully tax-equivalent net interest margin rose from 5.23% in the preceding quarter and 5.05% a year earlier. The improvement accompanied net interest income that remained marginally short of analysts’ expectations.
The chief executive identified operational efficiency and margin management as key contributors to the quarter’s performance. Tangible book value per share edged down to $14.75 from $14.77 in the prior quarter.
Old Second Bancorp, which trades on Nasdaq under the ticker OSBC, is a community bank holding company headquartered in Aurora, Illinois. It primarily serves individuals, small and medium-sized businesses, and municipalities in the Chicago metropolitan area and northern Illinois.
Credit measures improve despite higher loan losses
Loan losses were higher than anticipated because of a known commercial account issue. Nonperforming loans declined 30% and classified loans fell 44%.
The bank bought back 1.5 million shares, equivalent to roughly 3% of total shares outstanding. That completed repurchase activity accompanied the declared dividend increase, which applies to the upcoming quarter.
The trailing 12-month price-to-earnings ratio was 14.27 times, compared with a five-year median of 10.08 times.
Insider share sales totaled approximately $8.3 million over the preceding 12 months, with no insider purchases recorded. Those transactions are separate from the bank’s own share repurchases.
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