third quarter 2026
Filed Oct 21, 2026Old National Bancorp Reports Record Third Quarter 2026 Results
Old National reported record net income applicable to common shares of $250.0 million, record adjusted EPS of $0.66, a record efficiency ratio of 46.1%, loan and deposit growth, and a 19.6% ROATCE. Net interest income increased, while expense discipline more than offset lower noninterest income.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net interest income, three months ended September 30, 2026GAAP | $584.3M | – | – |
| Net interest income, tax equivalent basis, three months ended September 30, 2026non-GAAP | $592.0M | – | – |
| Total revenue, tax equivalent basis, three months ended September 30, 2026non-GAAP | $720.4M | – | – |
| Provision for credit losses, three months ended September 30, 2026GAAP | $33.58M | – | – |
| Noninterest income, three months ended September 30, 2026GAAP | $128.4M | – | – |
| Noninterest expense, three months ended September 30, 2026GAAP | $355.4M | – | – |
| Adjusted noninterest expense, three months ended September 30, 2026non-GAAP | $354.7M | – | – |
| Income before income taxes, three months ended September 30, 2026GAAP | $323.8M | – | – |
| Income tax expense, three months ended September 30, 2026GAAP | $69.78M | – | – |
| Effective tax rate, three months ended September 30, 2026GAAP | 21.6% | – | – |
| Adjusted fully taxable equivalent effective tax rate, three months ended September 30, 2026non-GAAP | 23.4% | – | – |
| Net income, three months ended September 30, 2026GAAP | $254.0M | – | – |
| Net income applicable to common shares, three months ended September 30, 2026GAAP | $250.0M | – | – |
| Adjusted net income applicable to common shares, three months ended September 30, 2026non-GAAP | $249.7M | – | – |
| EPS, diluted, three months ended September 30, 2026GAAP | $0.66 | – | – |
| Adjusted EPS, diluted, three months ended September 30, 2026non-GAAP | $0.66 | – | – |
| Pre-provision net revenue, three months ended September 30, 2026non-GAAP | $365.0M | – | – |
| Adjusted pre-provision net revenue, three months ended September 30, 2026non-GAAP | $364.8M | – | – |
| Net interest margin, three months ended September 30, 2026GAAP | 3.47% | – | – |
| Net interest margin, fully taxable equivalent, three months ended September 30, 2026non-GAAP | 3.52% | down 2 bps | – |
| Efficiency ratio, three months ended September 30, 2026non-GAAP | 46.1% | – | – |
| Adjusted efficiency ratio, three months ended September 30, 2026non-GAAP | 44.9% | – | – |
| Return on average assets, three months ended September 30, 2026GAAP | 1.37% | – | – |
| Return on average equity, three months ended September 30, 2026GAAP | 12.0% | – | – |
| Return on average tangible common equity, three months ended September 30, 2026non-GAAP | 19.6% | – | – |
| Adjusted return on average tangible common equity, three months ended September 30, 2026non-GAAP | 19.6% | – | – |
| End-of-period total loans, September 30, 2026GAAP | $51.15B | up $362.3 million or 2.9% annualized | – |
| End-of-period total deposits, September 30, 2026GAAP | $57.64B | up 10.6% annualized | – |
| Net charge-offs to average loans, three months ended September 30, 2026GAAP | 0.27% | – | – |
| Allowance for credit losses to end-of-period loans, September 30, 2026other | 1.20% | – | – |
| Nonaccrual loans to end-of-period loans, September 30, 2026GAAP | 0.92% | – | – |
| 30+ day delinquencies to end-of-period loans, September 30, 2026GAAP | 0.25% | – | – |
| Preliminary Tier 1 common equity to risk-weighted assets, September 30, 2026other | 11.11% | up 2 bps | – |
| Preliminary total risk-based capital, September 30, 2026other | 13.59% | down 6 bps | – |
| Tangible common equity to tangible assets, September 30, 2026non-GAAP | 7.28% | – | – |
Amounts quoted below without a unit are in thousands, as in the filing’s tables. Per-share figures are as printed.
Capital returns
- Repurchased $100 million, or 3.9 million shares, of common stock during the quarter.
- Paid $55 million of quarterly common stock cash dividends during the quarter.
- Combined payout ratio of 62%.
- Cash dividends of $0.145 per common share.
What drove it
- Net interest income on a fully taxable equivalent basis increased to $592.0 million compared to $586.5 million, driven by high quality loan and deposit growth, partly offset by core deposit pricing and funding mix.
- Period-end total loans were $51.2 billion, including commercial and industrial growth of $148.0 million and commercial real estate growth of $157.3 million.
- Average total deposits for the third quarter were $56.9 billion, an increase of $1.3 billion.
- Adjusted noninterest expense decreased to $354.7 million, compared to $360.1 million.
- Noninterest income was down 9.1% excluding pension plan gains and realized debt securities gains, driven by approximately $10 million of elevated other income in the second quarter of 2026 due to market value adjustments, higher company-owned life insurance income and an asset recovery.
Concerns
- Net interest margin on a fully taxable equivalent basis decreased 2 bps to 3.52%.
- Cost of total deposits was 1.79%, increasing 8 bps, and the cost of total interest-bearing deposits increased 8 bps to 2.31%.
- Noninterest income was $128.4 million compared to $153.6 million.
- Net charge-offs were $34.1 million, or 27 bps of average loans, compared to 26 bps.
- Nonaccrual loans as a percentage of total loans were 0.92% compared to 0.91%.
- Tangible common equity to tangible assets was 7.28% compared to 7.68%, driven by the $391 million impact of rates on other comprehensive income.
- Period-end commercial pipeline totaled $4.4 billion, down 20% from record levels at the end of the second quarter.
What to watch
- Net interest margin, including the effect of core deposit pricing and funding mix.
- Deposit costs, which were 179 bps for total deposits and 231 bps for interest-bearing deposits.
- The conversion of the $4.4 billion period-end commercial pipeline into loan growth.
- Credit trends in net charge-offs, 30+ day delinquencies and nonaccrual loans.
- Noninterest-income normalization following the elevated other income recorded in the second quarter of 2026.
- Capital ratios and tangible common equity following the $391 million impact of rates on other comprehensive income and shareholder distributions.
Balance sheet and cash flow
- Cash and due from banks of $507,214 as of September 30, 2026.
- Total assets of $74,423,980 as of September 30, 2026.
- Total borrowed funds of $7,134,231 as of September 30, 2026.
- Total shareholders' equity of $8,295,211 as of September 30, 2026.
- A loan to deposit ratio of 89%.
- Operating cash flow and free cash flow were not reported.
Analysis
Old National delivered record third-quarter earnings, reporting net income applicable to common shares of $250.0 million and diluted EPS of $0.66. Adjusted net income applicable to common shares was $249.7 million and adjusted diluted EPS was $0.66. Profitability remained high, with ROATCE of 19.6% and adjusted ROATCE of 19.6%. The company also reported a record efficiency ratio of 46.1% and a record adjusted efficiency ratio of 44.9%.
Core balance-sheet growth supported net interest income. Net interest income on a fully taxable equivalent basis was $592.0 million, compared to $586.5 million, with management attributing the increase to high quality loan and deposit growth. Period-end total loans were $51.2 billion, up $362.3 million or 2.9% annualized, while period-end total deposits were $57.6 billion, up 10.6% annualized. Commercial and industrial loans grew $148.0 million and commercial real estate loans grew $157.3 million.
Margin pressure persisted despite the higher net interest income. Fully taxable equivalent NIM declined 2 bps to 3.52%, as core deposit pricing and funding mix partly offset earning-asset growth and favorable rate and volume mix. Total deposit costs were 179 bps, up 8 bps, and interest-bearing deposit costs were 231 bps, also up 8 bps. The loan to deposit ratio was 89%, which the company said, together with existing funding sources, provided strong liquidity.
Noninterest income moderated from an elevated second quarter, totaling $128.4 million compared to $153.6 million. Excluding pension plan gains and realized debt securities gains, management said noninterest income declined 9.1% because the second quarter included approximately $10 million of elevated other income from market value adjustments, higher company-owned life insurance income and an asset recovery. Expense control was a meaningful offset: adjusted noninterest expense was $354.7 million, compared to $360.1 million, supporting adjusted PPNR of $364.8 million.
Credit measures were broadly stable but warrant monitoring. Provision expense was $33.6 million compared to $36.2 million, while net charge-offs were $34.1 million, or 27 bps of average loans, compared to 26 bps. Delinquencies improved to 0.25% from 0.29%, but nonaccrual loans were 0.92% of total loans compared to 0.91%. Capital remained solid, with preliminary Tier 1 common equity to risk-weighted assets of 11.11%, while tangible common equity to tangible assets declined to 7.28% from 7.68%, driven by the $391 million impact of rates on other comprehensive income. The company returned $155 million to shareholders through repurchases and dividends during the quarter.
Management, verbatim
With our strong 3rd quarter results, highlighted by record net income, a record efficiency ratio, and growth in both deposits and loans, Old National continues to demonstrate the strength and consistency of our operating model.
Jim Ryan, Chairman and CEO
Our disciplined focus on fundamentals continues to drive profitable growth, positive operating leverage, and meaningful value creation for our shareholders. As we look ahead, we remain very well positioned to build on this momentum and capitalize on opportunities across our growing franchise.
Jim Ryan, Chairman and CEO
Not in the filing
stated, not guessed- Forward financial guidance was not provided.
- Previous-release outlook was not provided.
- Gross margin was not reported.
- Operating income was not reported.
- Operating cash flow was not reported.
- Free cash flow was not reported.
- Reportable business-segment revenue was not reported.
- CFO commentary was not provided.
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.