Nicolet Bankshares Reports Q2 2026 Net Income of $57M, Core EPS of $2.99
Nicolet Bankshares announced Q2 2026 net income of $57 million with core net income of $65 million (non-GAAP), supported by net interest income of $141 million and a net interest margin of 4.14%. The bank repurchased 267,310 shares for $40 million and authorized $150 million in additional buybacks, while declaring a quarterly dividend of $0.36 per share. Results were bolstered by the full-quarter inclusion of MidWestOne balances following the February 2026 acquisition, with the pending sale of Denver branches to Sunwest Bank expected to close in Q3 2026.
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Nicolet Bankshares, Inc. announced second quarter 2026 net income of $57 million and diluted earnings per common share of $2.62, compared to net income of $15 million and diluted EPS of $0.81 for first quarter 2026, and net income of $36 million and diluted EPS of $2.34 for second quarter 2025. Net income included certain non-core items, primarily merger-related expenses, that negatively impacted diluted EPS by $0.37 for second quarter 2026 and $1.94 for first quarter 2026, resulting in core diluted earnings per common share (non-GAAP) of $2.99 and $2.75, respectively.
"Our second quarter results reflect the strength of the Nicolet model and the disciplined execution of our team," said Mike Daniels, Chairman, President, and CEO. "Core earnings remained strong, net interest margin expanded, credit quality continued to perform well, allowing us to repurchase stock throughout the quarter, and tangible book value increased. I'm particularly pleased with the progress we've made integrating MidWestOne."
Key Financial Highlights
The following table summarizes key performance metrics for second quarter 2026 compared to first quarter 2026 and second quarter 2025:
| Metric: | Q2 2026 | Q1 2026 | Q2 2025 |
|---|---|---|---|
| Net Income: | $57 million | $15 million | $36 million |
| Core Net Income (non-GAAP): | $65 million | $52 million | — |
| Diluted EPS: | $2.62 | $0.81 | $2.34 |
| Core Diluted EPS (non-GAAP): | $2.99 | $2.75 | — |
| Net Interest Income: | $141 million | $110 million | $75 million |
| Net Interest Margin: | 4.14% | 3.98% | 3.72% |
| Return on Average Assets: | 1.47% | 0.50% | 1.62% |
| Core Return on Average Assets (non-GAAP): | 1.69% | 1.68% | 1.63% |
| Return on Average Tangible Common Equity: | 19.07% | 6.49% | 18.72% |
| Core Return on Average Tangible Common Equity (non-GAAP): | 21.59% | 19.30% | 18.80% |
| Return on Average Equity: | 10.09% | 3.44% | 12.21% |
Balance Sheet and Asset Quality
At June 30, 2026, period-end assets were $15.4 billion, a decrease of $160 million from March 31, 2026, largely due to lower cash and cash equivalents. Total loans decreased $32 million from March 31, 2026, while investments grew $20 million. Total deposits of $12.5 billion at June 30, 2026, decreased $101 million from March 31, 2026, including a $100 million decrease in brokered deposits and a $1 million decrease in core deposits. Long-term borrowings decreased $87 million from the prior quarter due to the early redemption of junior subordinated debentures. Total capital was $2.3 billion at June 30, 2026, an increase of $15 million over March 31, 2026.
The following table presents selected balance sheet metrics:
| Metric: | 6/30/2026 | 3/31/2026 |
|---|---|---|
| Total Assets: | $15.4 billion | $15.6 billion |
| Total Loans: | $10,848,164 thousand | $10,879,694 thousand |
| Total Deposits: | $12,523,336 thousand | $12,624,364 thousand |
| Total Capital: | $2.3 billion | — |
| Nonperforming Assets: | $75 million (0.49% of assets) | $79 million (0.51% of assets) |
| Allowance for Credit Losses–Loans: | $134 million (1.23% of loans) | $133 million (1.23% of loans) |
Asset quality trends remain solid and loan net charge-offs were negligible.
Income Statement Review
Net interest income was $141 million for second quarter 2026, $32 million (29%) higher than first quarter 2026, driven by a full quarter of MidWestOne balances. The net interest margin for second quarter 2026 was 4.14%, compared to 3.98% for first quarter 2026, with a portion of the increase attributable to loan purchase accounting accretion (which added 23 bps and 18 bps to second and first quarter net interest margin, respectively). The yield on interest-earning assets increased 13 bps to 5.86%, while the cost of interest-bearing liabilities decreased 7 bps to 2.29%.
Noninterest income was $36 million for second quarter 2026, up $11 million compared to first quarter 2026. Noninterest expense was $104 million for second quarter 2026, a $6 million decrease from first quarter 2026, mostly due to a $33 million decrease in merger-related expense offset by a full quarter of MidWestOne expenses.
MidWestOne Acquisition Impact
Nicolet's financial performance was impacted by the timing and size of the MidWestOne Financial Group, Inc. acquisition on February 13, 2026. At acquisition, MidWestOne added total assets of $6.1 billion, loans of $4.4 billion, and deposits of $5.3 billion. Certain income statement results, average balances, and related ratios for 2026 include partial contributions from MidWestOne from the acquisition date.
Share Repurchases and Dividend
Nicolet repurchased 267,310 common shares for $40 million during second quarter 2026 and authorized $150 million in additional repurchases. On July 21, 2026, the Board of Directors declared a quarterly cash dividend of $0.36 per share, payable on September 15, 2026, to shareholders of record as of September 1, 2026.
Sale of Denver Branches
On April 21, 2026, Nicolet National Bank entered into a definitive purchase and assumption agreement to sell its Denver, Colorado banking branches (acquired in the MidWestOne transaction) to Sunwest Bank. The all-cash transaction has received regulatory approval and is expected to close in third quarter 2026, subject to standard closing conditions. As of June 30, 2026, the Denver locations had total loans of approximately $402 million and deposits of approximately $388 million.
Nicolet expects to issue its third quarter 2026 earnings release on October 20, 2026.
How will the upcoming sale of the Denver branches in the third quarter impact the bank's net interest margin and deposit funding costs?
What is the expected timeline for fully realizing merger-related cost synergies following the integration of MidWestOne?
With the authorization of an additional $150 million in share repurchases, what is the management's target for tangible book value growth by the end of 2026?
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