Summary of Old National Bancorp (ONB) Q4 2025 Earnings Call

1Key Financial Results and Metrics

Earnings Per Share (EPS): GAAP EPS of $0.55; adjusted EPS of $0.62, a 5% increase quarter-over-quarter and a 27% increase year-over-year.

Return Metrics: Adjusted return on average tangible common equity (ROATCE) of nearly 20%; adjusted return on assets (ROA) of 1.37%.

Efficiency Ratio: Record low adjusted efficiency ratio of 46%.

Loan Growth: Total loans grew 6.4% annualized from the prior quarter.

Credit Quality: Criticized and classified loans decreased by 8%; total net charge-offs at 27 basis points.

Capital Position: Common Equity Tier 1 (CET1) ratio over 11%; tangible book value per share increased by 15% year-over-year.

2Strategic Updates and Business Highlights

Successful completion of the systems conversion and integration related to the Bremer Bank partnership, enhancing market presence in Minnesota and North Dakota.

Focus on organic growth and disciplined capital returns, with a commitment to investing in talent, technology, and client-facing capabilities.

Continued strong performance in fee income, particularly in mortgage and capital markets, driven by favorable rate conditions.

Commitment to maintaining a disciplined approach to pricing and managing deposit costs.

3Forward Guidance and Outlook

2026 Loan Growth: Expected growth of 4% to 6%, with a positive outlook on borrower sentiment driven by lower rates and economic clarity.

Net Interest Income (NII): Anticipated increase due to asset repricing and continued loan growth; guidance includes expectations for two additional rate cuts.

Expense Management: Expectation of controlled expenses with full realization of Bremer cost savings in Q1 2026.

Capital Management: Plans for increased share repurchases in 2026 while maintaining adequate capital for growth.

4Bad News, Challenges, or Points of Concern

Deposit Growth: Core deposits decreased by 3% annualized, primarily due to seasonally lower public funds balances.

Market Competition: Competitive pressures in certain markets, particularly regarding deposit pricing, though management noted rationality in pricing strategies.

Credit Risks: While credit metrics improved, ongoing active portfolio management is necessary, and there is a cautious outlook on macroeconomic uncertainties.

5Notable Q&A Insights

Margin Trajectory: Management indicated that day count impacts NII projections, with expectations for stable margins moving through 2026.

Capital Management: Plans for a more active share repurchase strategy in 2026 compared to 2025, balancing growth and capital returns.

Loan Growth Drivers: Positive sentiment among borrowers is expected to drive growth, with a focus on middle-market commercial and industrial sectors.

Wealth Management Strategy: Emphasis on talent acquisition to enhance growth in the wealth management segment, indicating potential for increased market penetration. Overall, Old National Bancorp reported a strong finish to 2025, with record financial performance and strategic initiatives aimed at sustaining growth and profitability in 2026, despite some challenges in deposit growth and competitive pressures.