Old National Bancorp Reports Strong Q1 Earnings with Loan & Deposit Growth, Notes Rising Unrealized Losses on Securities
Summary
Old National Bancorp reported strong Q1 2026 earnings with significant loan and deposit growth, but also disclosed increasing unrealized losses on its investment securities portfolio, indicating ongoing interest rate sensitivity.
Key Events
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Strong Q1 2026 Financial Performance
Net income applicable to common shareholders rose to $229.6 million, or $0.59 per diluted common share, compared to $212.6 million ($0.55 diluted EPS) in Q4 2025 and $140.6 million ($0.44 diluted EPS) in Q1 2025.
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Robust Loan and Deposit Growth
Total loans increased by $967.7 million (8% annualized) to $49.7 billion, and total deposits grew by $584.3 million (4% annualized) to $55.7 billion during the quarter.
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Increasing Unrealized Losses on Investment Securities
Net unrealized losses on available-for-sale securities increased to $656.3 million (from $570.4 million in Q4 2025), and held-to-maturity securities had unrealized losses of $391.9 million (from $355.3 million in Q4 2025), reflecting interest rate sensitivity.
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Significant Capital Activities
The company issued $450 million in 5.768% fixed-to-floating rate subordinated notes due 2036 and repurchased $104.1 million of common stock under its existing share repurchase program during Q1 2026.
Analysis
Old National Bancorp delivered strong first-quarter 2026 financial results, with net income applicable to common shareholders increasing to $229.6 million ($0.59 diluted EPS) from $212.6 million ($0.55 diluted EPS) in the prior quarter and $140.6 million ($0.44 diluted EPS) in Q1 2025. This performance was driven by robust loan and deposit growth, alongside disciplined expense management. However, the company also reported a notable increase in unrealized losses on its investment securities portfolio, with available-for-sale securities showing net unrealized losses of $656.3 million (up from $570.4 million in Q4 2025) and held-to-maturity securities at $391.9 million (up from $355.3 million). While management states no intent to sell these securities, the growing unrealized losses highlight interest rate risk exposure. Credit quality showed mixed signals, with an increase in provision for credit losses and net charge-offs, but a decrease in non-performing loans. The company also completed a $450 million subordinated notes issuance and repurchased $104.1 million in common stock under its existing program, reflecting active capital management.
At the time of this filing, ONB was trading at $23.55 on NASDAQ in the Finance sector, with a market capitalization of approximately $9.1B. The 52-week trading range was $19.39 to $26.17. This filing was assessed with neutral market sentiment and an importance score of 7 out of 10.