The 5 Most Interesting Analyst Questions From Old Second Bancorp’s Q4 Earnings Call

Midwest regional bank Old Second Bancorp met Wall Streets revenue expectations in Q4 CY2025, with sales up 29.9% year on year to $95.54 million. Its non-GAAP profit of $0.58 per share was 8.1% above analysts’ consensus estimates.

Old Second Bancorp (OSBC) Q4 CY2025 Highlights:

• Revenue: $95.54 million vs analyst estimates of $95.29 million (29.9% year-on-year growth, in line)
• Adjusted EPS: $0.58 vs analyst estimates of $0.54 (8.1% beat)
• Adjusted Operating Income: $39.6 million vs analyst estimates of $41.7 million (41.5% margin, 5% miss)
• Market Capitalization: $1.05 billion

StockStory’s Take

Old Second Bancorp’s fourth quarter delivered results that aligned with Wall Street’s revenue expectations, while non-GAAP earnings per share outpaced analyst forecasts. Management attributed the quarter’s performance to strong net interest margin, prudent cost control, and ongoing benefits from the integration of recent acquisitions. CEO Jim Eccher noted that the company’s “exceptionally strong net interest margin at 5.09%” was a key driver, alongside an increased tangible equity ratio and steady asset quality. However, management also highlighted higher net charge-offs in the Powersports portfolio, acknowledging, “losses given default are running a bit higher than we expected,” though they emphasized contribution margins in that segment remain robust.

Looking ahead, Old Second Bancorp’s outlook centers on maintaining stable margins, controlling expense growth, and achieving mid-single-digit loan growth, while managing credit risk in the Powersports segment. COO and CFO Brad Adams indicated that expense growth will be moderated by cost saves from previous integrations, but inflationary pressures in employee benefits are expected. Management also highlighted the importance of optimizing the bank’s funding mix as brokered deposits run off. Eccher stated, “We’re very bullish on our 2026 performance,” pointing to a strong loan pipeline and further improvements in the Powersports business as potential catalysts.

Key Insights from Management’s Remarks

Management credited robust net interest margin, integration progress, and focused growth strategies for shaping the quarter’s outcome and setting the stage for future performance.

• Powersports portfolio dynamics: Management emphasized that although net charge-offs rose in the Powersports loan book, the segment’s higher yields and contribution margin outweighed elevated losses. CEO Jim Eccher described the business as “very good,” noting contribution margin is at a multi-year high and anticipating continued profitability despite higher charge-offs in the current rate environment.
• Net interest margin resilience: The bank maintained an above-5% tax-equivalent net interest margin, driven by a favorable funding mix and disciplined deposit cost management. Adams highlighted that the current funding structure, including a temporary reliance on brokered deposits, supports margin resilience amid shifting interest rates.
• Loan growth and headwinds: While organic loan production was strong, run-off in acquired commercial real estate participations—particularly from West Suburban—offset growth. Eccher observed that pipeline activity is at its highest in several quarters, supporting optimism for mid-single-digit loan growth in the coming year.
• Expense management and integration: Noninterest expenses declined, reflecting the completion of integration-related costs from the Evergreen acquisition and other cost-saving initiatives. Adams stated that expense growth should remain modest, aided by branch closures and ongoing efficiency improvements.
• Asset quality trends: Asset quality remained generally stable, with a slight increase in nonperforming loans and classified assets. Special mention loans declined significantly, signaling early-stage improvement, though management cautioned that some credit normalization is expected as economic conditions evolve.

Drivers of Future Performance

Old Second Bancorp’s management expects stable margins, measured loan growth, and careful expense control to guide results, while credit discipline and funding optimization remain priorities.

• Loan growth opportunities: Management targets mid-single-digit loan growth, supported by a robust pipeline across multiple verticals. Eccher noted that strong production in the fourth quarter and early 2026 positions the bank well, though runoff in legacy portfolios will remain a headwind.
• Margin and funding mix: Adams expects net interest margin to hold near current levels, with further improvements reliant on completing the transition away from higher-cost brokered deposits. The funding mix will be closely managed as wholesale funding is replaced by core deposits over time.
• Expense and credit risk management: Expense growth is anticipated to remain moderate, with inflationary pressures in benefits partially offset by cost saves from prior integrations and branch closures. Management remains vigilant on credit risk—particularly in Powersports—expecting elevated but manageable charge-offs while monitoring classified and special mention loan trends.

Catalysts in Upcoming Quarters

In the coming quarters, our analysts will be monitoring (1) the pace of core deposit replacement as brokered funding continues to run off, (2) the trajectory of net charge-offs and contribution margins within the Powersports portfolio, and (3) the ability to sustain mid-single-digit loan growth against the backdrop of legacy portfolio runoff. Execution on expense control initiatives and early signs of asset quality improvement will also be closely watched.

Old Second Bancorp currently trades at $19.68, down from $21.47 just before the earnings. At this price, is it a buy or sell? Find out in our full research report (it’s free).

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Midwest regional bank Old Second Bancorp met Wall Streets revenue expectations in Q4 CY2025, with sales up 29.5% year on year to $95.21 million. Its non-GAAP profit of $0.58 per share was 8.1% above analysts’ consensus estimates.

Old Second Bancorp (OSBC) Q4 CY2025 Highlights:

• Net Interest Income: $83.05 million vs analyst estimates of $82.45 million (34.9% year-on-year growth, 0.7% beat)
• Net Interest Margin: 5.1% vs analyst estimates of 5% (8.3 basis point beat)
• Revenue: $95.21 million vs analyst estimates of $95.29 million (29.5% year-on-year growth, in line)
• Efficiency Ratio: 54% vs analyst estimates of 54.3% (36.2 basis point beat)
• Adjusted EPS: $0.58 vs analyst estimates of $0.54 (8.1% beat)
• Tangible Book Value per Share: $14.12 vs analyst estimates of $13.99 (14% year-on-year growth, 0.9% beat)
• Market Capitalization: $1.07 billion

Company Overview

Dating back to 1871 as one of the Chicago area's longest-standing financial institutions, Old Second Bancorp is an Illinois-based community bank offering deposit services, commercial and consumer loans, wealth management, and mortgage products through its 53 branch locations.

Sales Growth

In general, banks make money from two primary sources. The first is net interest income, which is interest earned on loans, mortgages, and investments in securities minus interest paid out on deposits. The second source is non-interest income, which can come from bank account, credit card, wealth management, investing banking, and trading fees. Thankfully, Old Second Bancorp’s 21.1% annualized revenue growth over the last five years was incredible. Its growth beat the average banking company and shows its offerings resonate with customers, a helpful starting point for our analysis.

We at StockStory place the most emphasis on long-term growth, but within financials, a half-decade historical view may miss recent interest rate changes, market returns, and industry trends. Old Second Bancorp’s recent performance shows its demand has slowed significantly as its annualized revenue growth of 8.8% over the last two years was well below its five-year trend.

This quarter, Old Second Bancorp’s year-on-year revenue growth of 29.5% was excellent, and its $95.21 million of revenue was in line with Wall Street’s estimates.

Net interest income made up 82% of the company’s total revenue during the last five years, meaning Old Second Bancorp barely relies on non-interest income to drive its overall growth.

Markets consistently prioritize net interest income growth over fee-based revenue, recognizing its superior quality and recurring nature compared to the more unpredictable non-interest income streams.

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Tangible Book Value Per Share (TBVPS)

Banks profit by intermediating between depositors and borrowers, making them fundamentally balance sheet-driven enterprises. Market participants emphasize balance sheet quality and sustained book value growth when evaluating these institutions.

When analyzing banks, tangible book value per share (TBVPS) takes precedence over many other metrics. This measure isolates genuine per-share value by removing intangible assets of debatable liquidation worth. Traditional metrics like EPS are helpful but face distortion from M&A activity and loan loss accounting rules.

Old Second Bancorp’s TBVPS grew at an impressive 7.7% annual clip over the last five years. TBVPS growth has also accelerated recently, growing by 14.7% annually over the last two years from $10.73 to $14.12 per share.

Over the next 12 months, Consensus estimates call for Old Second Bancorp’s TBVPS to grow by 13.6% to $16.05, decent growth rate.

Key Takeaways from Old Second Bancorp’s Q4 Results

It was good to see Old Second Bancorp beat analysts’ EPS expectations this quarter. We were also happy its tangible book value per share narrowly outperformed Wall Street’s estimates. Overall, this print had some key positives. The stock remained flat at $21.46 immediately following the results.

Should you buy the stock or not? We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).

Midwest regional bank Old Second Bancorp will be reporting results this Wednesday after market close. Here’s what investors should know.

Old Second Bancorp beat analysts’ revenue expectations by 3.6% last quarter, reporting revenues of $96.22 million, up 34.6% year on year. It was a very strong quarter for the company, with an impressive beat of analysts’ tangible book value per share estimates and a solid beat of analysts’ revenue estimates.

Is Old Second Bancorp a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.

This quarter, analysts are expecting Old Second Bancorp’s revenue to grow 29.6% year on year to $95.29 million, improving from the 4.6% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.54 per share.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Old Second Bancorp has only missed Wall Street’s revenue estimates once over the last two years, exceeding top-line expectations by 1.5% on average.

Looking at Old Second Bancorp’s peers in the regional banks segment, some have already reported their Q4 results, giving us a hint as to what we can expect. First Horizon delivered year-on-year revenue growth of 8.1%, beating analysts’ expectations by 3.2%, and BOK Financial reported revenues up 12.7%, topping estimates by 7.6%. First Horizon traded up 102% following the results.

Read our full analysis of First Horizon’s results here and BOK Financial’s results here.

Investors in the regional banks segment have had steady hands going into earnings, with share prices up 1.4% on average over the last month. Old Second Bancorp’s stock price was unchanged during the same time and is heading into earnings with an average analyst price target of $22.92 (compared to the current share price of $20.66).

Old Second Bancorp has been treading water for the past six months, recording a small return of 4.1% while holding steady at $19.74. The stock also fell short of the S&P 500’s 11.1% gain during that period.

Does this present a buying opportunity for OSBC? Or is its underperformance reflective of its story and business quality? Find out in our full research report, it’s free.

Why Does OSBC Stock Spark Debate?

Dating back to 1871 as one of the Chicago area's longest-standing financial institutions, Old Second Bancorp is an Illinois-based community bank offering deposit services, commercial and consumer loans, wealth management, and mortgage products through its 53 branch locations.

Two Things to Like:

1. Net Interest Income Skyrockets, Fueling Growth Opportunities

Our experience and research show the market cares primarily about a bank’s net interest income growth as one-time fees are considered a lower-quality and non-recurring revenue source.

Old Second Bancorp’s net interest income has grown at a 24.4% annualized rate over the last five years, much better than the broader banking industry and faster than its total revenue. Its growth was driven by both an increase in its outstanding loans and net interest margin, which represents how much a bank earns in relation to its outstanding loan book.

2. Elite Net Interest Margin Powers Best-In-Class Loan Book

Net interest margin (NIM) serves as a critical gauge of a bank's fundamental profitability by showing the spread between interest income and interest expenses. It's essential for understanding whether a firm can sustainably generate returns from its lending operations.

Over the past two years, we can see that Old Second Bancorp’s net interest margin averaged an elite 4.8%, indicating the company has a high-yielding loan book and a low cost of funds.

One Reason to be Careful:

Lackluster Revenue Growth

Long-term growth is the most important, but within financials, a stretched historical view may miss recent interest rate changes and market returns. Old Second Bancorp’s recent performance shows its demand has slowed significantly as its annualized revenue growth of 4.7% over the last two years was well below its five-year trend.

Note: Quarters not shown were determined to be outliers, impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.

Final Judgment

Old Second Bancorp’s merits more than compensate for its flaws. With its shares trailing the market in recent months, the stock trades at 1.2× forward P/B (or $19.74 per share). Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.

Wrapping up Q3 earnings, we look at the numbers and key takeaways for the regional banks stocks, including Old Second Bancorp and its peers.

Regional banks, financial institutions operating within specific geographic areas, serve as intermediaries between local depositors and borrowers. They benefit from rising interest rates that improve net interest margins (the difference between loan yields and deposit costs), digital transformation reducing operational expenses, and local economic growth driving loan demand. However, these banks face headwinds from fintech competition, deposit outflows to higher-yielding alternatives, credit deterioration (increasing loan defaults) during economic slowdowns, and regulatory compliance costs. Recent concerns about regional bank stability following high-profile failures and significant commercial real estate exposure present additional challenges.

The 101 regional banks stocks we track reported a satisfactory Q3. As a group, revenues beat analysts’ consensus estimates by 1.3%.

Thankfully, share prices of the companies have been resilient as they are up 9.7% on average since the latest earnings results.

Old Second Bancorp

Dating back to 1871 as one of the Chicago area's longest-standing financial institutions, Old Second Bancorp is an Illinois-based community bank offering deposit services, commercial and consumer loans, wealth management, and mortgage products through its 53 branch locations.

Old Second Bancorp reported revenues of $96.22 million, up 34.6% year on year. This print exceeded analysts’ expectations by 3.6%. Overall, it was a very strong quarter for the company with a solid beat of analysts’ tangible book value per share estimates and an impressive beat of analysts’ revenue estimates.

Interestingly, the stock is up 10.1% since reporting and currently trades at $19.77.

We think Old Second Bancorp is a good business, but is it a buy today? Read our full report here, it’s free.

Best Q3: Customers Bancorp

Originally founded with a "high-tech, high-touch" branch-light banking strategy, Customers Bancorp is a bank holding company that provides commercial and consumer banking services through its Customers Bank subsidiary, with a focus on business lending and digital banking.

Customers Bancorp reported revenues of $231.8 million, up 38.3% year on year, outperforming analysts’ expectations by 6.9%. The business had a stunning quarter with an impressive beat of analysts’ net interest income estimates and a solid beat of analysts’ revenue estimates.

The market seems happy with the results as the stock is up 19.5% since reporting. It currently trades at $78.37.

Weakest Q3: The Bancorp

Operating behind the scenes of many popular fintech apps and prepaid cards you might use daily, The Bancorp is a bank holding company that specializes in providing banking services to fintech companies and offering specialty lending products.

The Bancorp reported revenues of $174.7 million, up 38.8% year on year, falling short of analysts’ expectations by 9.9%. It was a disappointing quarter as it posted a significant miss of analysts’ revenue estimates and a significant miss of analysts’ net interest income estimates.

The Bancorp delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 9.6% since the results and currently trades at $69.81.

Read our full analysis of The Bancorp’s results here.

QCR Holdings

With roots dating back to 1993 and a name reflecting its original Quad Cities market, QCR Holdings (NASDAQGM:QCRH) operates four community banks across Iowa and Missouri, providing commercial, consumer banking, and trust services to businesses and individuals.

QCR Holdings reported revenues of $112.3 million, up 15.4% year on year. This result beat analysts’ expectations by 11.3%. It was an exceptional quarter as it also logged a beat of analysts’ EPS estimates and a solid beat of analysts’ revenue estimates.

QCR Holdings scored the biggest analyst estimates beat among its peers. The stock is up 17.1% since reporting and currently trades at $83.71.

Read our full, actionable report on QCR Holdings here, it’s free.

TowneBank

Founded in 1998 with a commitment to community-centered banking in the Hampton Roads region, TowneBank is a community-focused financial institution providing banking, lending, and wealth management services to individuals and businesses in Virginia and North Carolina.

TowneBank reported revenues of $215.7 million, up 23.6% year on year. This number met analysts’ expectations. Aside from that, it was a mixed quarter as it also produced an impressive beat of analysts’ tangible book value per share estimates but a miss of analysts’ net interest income estimates.

The stock is up 3.3% since reporting and currently trades at $34.75.

Read our full, actionable report on TowneBank here, it’s free.

Old Second Bancorp trades at $20.26 and has moved in lockstep with the market. Its shares have returned 7.5% over the last six months while the S&P 500 has gained 10.5%.

Is OSBC a buy right now? Find out in our full research report, it’s free.

Why Does Old Second Bancorp Spark Debate?

Dating back to 1871 as one of the Chicago area's longest-standing financial institutions, Old Second Bancorp is an Illinois-based community bank offering deposit services, commercial and consumer loans, wealth management, and mortgage products through its 53 branch locations.

Two Things to Like:

1. Net Interest Income Skyrockets, Fueling Growth Opportunities

While bank generate revenue from multiple sources, investors view net interest income as a cornerstone - its predictable, recurring characteristics stand in sharp contrast to the volatility of one-time fees.

Old Second Bancorp’s net interest income has grown at a 24.4% annualized rate over the last five years, much better than the broader banking industry and faster than its total revenue. Its growth was driven by both an increase in its outstanding loans and net interest margin, which represents how much a bank earns in relation to its outstanding loan book.

2. Elite Net Interest Margin Powers Best-In-Class Loan Book

Net interest margin (NIM) represents the unit economics of a bank by measuring the profitability of its interest-bearing assets relative to its interest-bearing liabilities. It's a fundamental metric that investors use to assess lending premiums and returns.

Over the past two years, we can see that Old Second Bancorp’s net interest margin averaged an elite 4.8%, indicating the company has a high-yielding loan book and a low cost of funds.

One Reason to be Careful:

Lackluster Revenue Growth

Long-term growth is the most important, but within financials, a stretched historical view may miss recent interest rate changes and market returns. Old Second Bancorp’s recent performance shows its demand has slowed significantly as its annualized revenue growth of 4.7% over the last two years was well below its five-year trend.

Final Judgment

Old Second Bancorp has huge potential even though it has some open questions, but at $20.26 per share (or 1.2× forward P/B), is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.