Q2 2024 Old Second Bancorp Inc Earnings Call Transcript
Key Points
- Old Second Bancorp Inc (OSBC) reported a net income of $21.9 million or $0.48 per diluted share for the second quarter of 2024, with a return on assets of 1.57%.
- The company's tangible equity ratio increased by 35 basis points to 9.39%, indicating a strengthening balance sheet.
- Common equity Tier 1 capital increased to 12.41%, reflecting strong capital positioning.
- Net interest margin improved slightly to 4.63% for the second quarter, driven by higher rates on variable securities and loans.
- Asset quality metrics improved with a reduction in substandard and criticized loans, down to $187.4 million, more than 40% below peak levels.
- Earnings were negatively impacted by a $3.8 million provision for credit losses, reducing after-tax earnings by $0.06 per diluted share.
- Interest expense on average interest-bearing liabilities increased by $3.2 million or 31.3%, driven by higher rates and deposit pricing.
- Net charge-offs increased to $5.8 million in the second quarter, up from $3.7 million in the first quarter of 2024.
- Total loans only increased by $7.2 million from the prior-linked quarter, indicating modest loan growth.
- Deposit flows showed signs of seasonality and stabilization, with average deposits decreasing by $4.3 million linked quarter.
Good morning, everyone, and thank you for joining us today for Old Second Bancorp, Incorporated, second-quarter 2024 earnings call. On the call today are Jim Eccher, the company's Chairman, President, and CEO; Brad Adams, the company's COO and CFO; and Gary Collins, the Vice Chairman of our Board.
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 and the current economic environment.
These statements are not a guarantee of future performance, and results may differ materially from those projected. Management would 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 our earnings release, which is available on our website at
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