Annual Report Reveals Mixed 2025 Results with Major Acquisition Driving Growth Amidst Rising Nonperforming Loans
OSBC sits 43% above its 52-week low of $14.14.
Summary
Old Second Bancorp reported a decline in 2025 GAAP net income and EPS, despite significant asset and loan growth from a major acquisition, with a notable increase in nonperforming loans and credit loss provisions.
Key Events · Earnings and Guidance · OSBC
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Net Income and EPS Decline
Net income available to common stockholders decreased to $80.3 million ($1.62 diluted EPS) in 2025 from $85.3 million ($1.87 diluted EPS) in 2024, primarily due to acquisition-related costs and higher credit loss provisions.
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Significant Acquisition Completed
The company completed its acquisition of Bancorp Financial, Inc. on July 1, 2025, adding approximately $1.43 billion in total assets, $1.20 billion in loans, and $1.23 billion in deposits. The consideration paid totaled $189.4 million, consisting of 7.9 million shares of common stock and $48.9 million in cash.
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Deterioration in Asset Quality
Nonperforming loans increased by 74.4% to $52.8 million in 2025 from $30.3 million in 2024. The provision for credit losses also significantly increased to $27.6 million in 2025 from $12.8 million in 2024, partly due to the acquisition and increased charge-offs in the newly acquired powersport loan segment.
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Dividend Increase and Share Repurchase
The Board of Directors declared a cash dividend of $0.07 per share, an increase from $0.06 in the prior quarter. A share repurchase program was re-authorized in January 2026 for up to 1,908,042 shares, following the repurchase of 326,854 shares in 2025.
Analysis · OSBC · Finance
Old Second Bancorp's 2025 annual report highlights significant balance sheet expansion driven by the Bancorp Financial acquisition, which added $1.43 billion in assets and $1.20 billion in loans. However, GAAP net income and diluted EPS declined year-over-year, and the provision for credit losses more than doubled to $27.6 million. Nonperforming loans also saw a substantial 74.4% increase to $52.8 million, indicating a deterioration in asset quality. While the company increased its quarterly dividend and re-authorized a share repurchase program, the negative trends in profitability and asset quality, alongside increased operating expenses related to the acquisition, present a mixed financial picture for investors.
At the time of this filing, OSBC was trading at $20.24 on NASDAQ in the Finance sector, with a market capitalization of approximately $1.1B. The 52-week trading range was $14.14 to $22.00. This filing was assessed with neutral market sentiment and an importance score of 7 out of 10.