Nicolet(NIC) - 2025 Q2 - Quarterly Results

Financial Performance Highlights Second Quarter 2025 Performance Overview Nicolet Bankshares achieved a record $36 million net income in Q2 2025, driven by loan and deposit growth, mortgage revenue, and an expanding net interest margin Net Income and Diluted EPS (Millions of USD) | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net Income | $36 million | $33 million | $29 million | | Diluted EPS | $2.34 | $2.08 | $1.92 | - CEO Mike Daniels attributed consistent performance to strong loan and core deposit growth, seasonal mortgage revenue, and healthy net interest margin expansion[3] Key Financial Metrics Q2 2025 saw record net income, the highest return on average assets since March 2023, a 14 bps NIM increase, and solid loan and deposit growth - Record quarterly net income of $36 million[6] - Return on Average Assets (ROAA) reached 1.62%, highest since March 2023[6] - Net Interest Margin (NIM) increased 14 bps over Q1 2025 to 3.72%[6] - Quarter-over-quarter loan growth of $94 million (5.6% annualized) and core deposit growth of $68 million (4.1% annualized)[6] - Repurchased 257,402 common shares for $30 million during the quarter[6] Financial Condition Analysis Balance Sheet Review Total assets were $8.9 billion as of June 30, 2025, with $94 million loan growth and $68 million core deposit growth, partially offset by reduced brokered deposits Balance Sheet Summary (Millions of USD) | Balance Sheet Item | June 30, 2025 | Change from Mar 31, 2025 | | :--- | :--- | :--- | | Total Assets | $8.9 billion | -$44 million | | Total Loans | - | +$94 million | | Total Deposits | $7.5 billion | -$31 million | | Core Deposits | - | +$68 million | | Brokered Deposits | - | -$99 million | | Total Capital | $1.2 billion | +$7 million | Asset Quality Asset quality remained strong in Q2 2025, with nonperforming assets at 0.32% of total assets and a stable 1.00% allowance for credit losses Asset Quality Ratios | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :--- | :--- | :--- | :--- | | Nonperforming Assets / Total Assets | 0.32% | 0.33% | 0.34% | | Allowance for Credit Losses / Total Loans | 1.00% | 1.00% | 1.00% | - Asset quality trends remain solid, with negligible loan net charge-offs for the quarter[5] Detailed Financial Review Income Statement Analysis (Quarterly) Q2 2025 net income rose to $36 million, driven by a $4 million increase in net interest income and a 14 bps NIM expansion to 3.72% - Net interest income grew by $4 million sequentially, driven by solid loan growth, with net interest margin expanding 14 bps to 3.72%[8] - Noninterest income increased by $2 million quarter-over-quarter, primarily from seasonal mortgage improvements and favorable deferred compensation asset valuations[9] - Noninterest expense rose by $2 million sequentially, with personnel costs increasing $3 million due to higher incentives from strong earnings[10] Consolidated Financial Statements & Metrics Consolidated Balance Sheets As of June 30, 2025, total assets reached $8.93 billion, supported by increased net loans to $6.77 billion and total deposits to $7.54 billion year-over-year Consolidated Balance Sheet (Thousands of USD) | (In thousands) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Total Assets | $8,930,809 | $8,557,017 | | Loans, net | $6,770,733 | $6,463,720 | | Total Deposits | $7,541,673 | $7,241,078 | | Total Stockholders' Equity | $1,190,098 | $1,091,413 | Consolidated Statements of Income Q2 2025 net income reached $36.0 million, a significant increase from Q2 2024, primarily driven by a rise in net interest income to $75.1 million Consolidated Statements of Income (Thousands of USD) | For the Three Months Ended (In thousands) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Net Interest Income | $75,109 | $65,342 | | Total Noninterest Income | $20,633 | $19,609 | | Total Noninterest Expense | $49,919 | $46,853 | | Net Income | $36,035 | $29,273 | Consolidated Financial Summary & Key Ratios Q2 2025 financial summary shows strong profitability and efficiency, with ROAA improving to 1.62%, NIM expanding to 3.72%, and efficiency ratio decreasing to 51.79% Selected Financial Ratios | Selected Ratios | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Return on average assets | 1.62% | 1.39% | | Return on average common equity | 12.21% | 11.00% | | Net interest margin | 3.72% | 3.42% | | Efficiency ratio | 51.79% | 55.24% | - The company repurchased 257,402 shares of common stock for approximately $30.0 million during Q2 2025[16] Loan and Deposit Composition As of June 30, 2025, total loans were $6.84 billion, with commercial loans at $5.25 billion, and total deposits were $7.54 billion, including $6.78 billion in core customer deposits Period End Loan Composition (Thousands of USD) | Period End Loan Composition (6/30/2025) | Amount (In thousands) | | :--- | :--- | | Commercial-based loans | $5,252,368 | | Retail-based loans | $1,586,773 | | Total loans | $6,839,141 | Period End Deposit Composition (Thousands of USD) | Period End Deposit Composition (6/30/2025) | Amount (In thousands) | | :--- | :--- | | Total customer deposits (core) | $6,783,198 | | Total brokered deposits | $758,475 | | Total deposits | $7,541,673 | Net Interest Income and Margin Analysis Q2 2025 net interest margin increased to 3.72%, driven by a higher average rate on earning assets (5.82%) while the cost of interest-bearing liabilities remained stable Net Interest Margin and Rate Analysis | For the Three Months Ended | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net Interest Margin | 3.72% | 3.58% | 3.42% | | Average Rate on Earning Assets | 5.82% | 5.67% | 5.68% | | Average Rate on Bearing Liabilities | 2.86% | 2.83% | 3.09% | Non-GAAP Financial Measures Use of Non-GAAP Measures Nicolet uses non-GAAP measures like tangible book value and return on average tangible common equity to enhance understanding of operational performance and capital strength - The company utilizes non-GAAP measures including adjusted net income, tangible book value per common share, and return on average tangible common equity[12] - Management considers these measures useful for understanding operating performance, trends, and for peer bank comparisons[12] Reconciliation of Non-GAAP Measures The report reconciles GAAP to non-GAAP figures, showing Q2 2025 adjusted net income of $36.2 million and tangible common equity of $805.0 million Non-GAAP Adjusted Net Income Reconciliation (Thousands of USD) | Reconciliation (Q2 2025, In thousands) | Amount | | :--- | :--- | | Net income (GAAP) | $36,035 | | Adjustments: Assets gains, net | $199 | | Tax on Adjustments | $39 | | Adjusted net income (Non-GAAP) | $36,195 | Non-GAAP Tangible Common Equity Reconciliation (Thousands of USD) | Tangible Reconciliation (June 30, 2025, In thousands) | Amount | | :--- | :--- | | Total stockholders' equity (GAAP) | $1,190,098 | | Less: Goodwill and other intangibles, net | $385,107 | | Tangible common equity (Non-GAAP) | $804,991 |