Executive Summary

Q3 2025 was transformational but mixed: reported diluted EPS was -$1.55 on a GAAP basis due to a $53.4M loss from securities repositioning, while core diluted EPS was $1.21 as net interest margin expanded 28 bps to 4.45% and net interest income rose to $62.5M .
Core EPS beat S&P Global consensus ($0.99 vs. $1.21), but GAAP earnings missed materially given the intentional bond sale loss; EBIT and normalized net income screens below consensus due to one-time items [Functions:GetEstimates].
Balance sheet scale-up from closing the NBC Oklahoma merger drove loans to $4.27B and deposits to $5.09B; CET1 fell to 12.87% with tangible common equity/tangible assets at 9.69% .
Catalysts: dividend increased 20% to $0.18, sub debt reissued ($75M), Frontier Holdings merger announced (Nebraska entry) with management guiding Q4 2025 NIM of 4.40–4.50% and 2026 NIM of 4.20–4.35% .

What Went Well and What Went Wrong

What Went Well
- Net interest margin expanded to 4.45% (core ~4.35% after normalization), driven by NBC accretion, funding mix, and mid-quarter securities repositioning; net interest income rose to $62.5M (+$12.7M QoQ) .
- Strategic execution: NBC closed and integrated (adds ~$665M loans, ~$808M deposits), sub debt reissued ($75M), Frontier merger announced (Omaha/Lincoln scale) .
- Core profitability intact: core net income $23.3M and core diluted EPS $1.21 despite one-time losses; efficiency ratio improved to 58.31% from 63.62% .
What Went Wrong
- Intentional bond portfolio repositioning generated a pre-tax loss of $53.4M, driving GAAP net loss of $29.7M and diluted EPS of -$1.55 .
- Non-interest expense climbed to $49.1M (+$9.1M QoQ) on merger costs and OREO loss; adjusted non-interest expense increased 8.3% QoQ .
- Capital ratios moderated: CET1 of 12.87% (vs. 15.07% in Q2); classified assets/regulatory capital rose to 12.37% with NBC additions (non-accrual +$7.0M; classified +$16.7M) .

Management quotes:

“Transformational quarters like these are not possible without excellent operators… Our teams are motivated to realize the benefits of our continued expansion efforts” — Brad S. Elliott, Chairman & CEO .
“Margin improved 28 basis points… normalizing purchase accounting… core margin of 4.35%” — CFO Chris Navratil .
“We enter the year with capital to grow… positioning the company to earn $5 per share in 2026” — CEO Brad Elliott .

Financial Results

Metric	Q3 2024	Q2 2025	Q3 2025
Net Interest Income ($USD Millions)	$46.0	$49.8	$62.5
Provision for Credit Losses ($USD Millions)	$1.18	$0.02	$6.23
Total Non-Interest Income ($USD Millions)	$9.32	$8.59	($44.48)
Total Non-Interest Expense ($USD Millions)	$30.33	$40.00	$49.08
Income (Loss) Before Tax ($USD Millions)	$23.84	$18.37	($37.30)
Net Income (Loss) ($USD Millions)	$19.85	$15.26	($29.66)
Diluted EPS ($USD)	$1.28	$0.86	($1.55)
Core Diluted EPS ($USD)	$1.32	$0.99	$1.21
Net Interest Margin (%)	3.87%	4.17%	4.45%
Efficiency Ratio (%)	52.59%	63.62%	58.31%

Balance Sheet & Capital	Q3 2024	Q2 2025	Q3 2025
Loans Held-for-Investment (EOP, $USD Millions)	$3,600.9	$3,600.7	$4,268.6
Deposits (EOP, $USD Millions)	$4,362.9	$4,234.9	$5,094.8
CET1 Ratio (%)	11.37%	15.07%	12.87%
TCE / Tangible Assets (%)	8.21%	10.63%	9.69%

Credit KPIs	Q3 2024	Q2 2025	Q3 2025
ACL / Total Loans (%)	1.21%	1.26%	1.25%
NPAs / Total Assets (%)	0.60%	0.85%	0.83%
Classified Assets / Regulatory Capital (%)	8.32%	11.39%	12.37%
Net Charge-offs (Annualized / Avg Loans, %)	—	0.06%	0.10%

Loan Composition (EOP, $USD Millions)	Q3 2024	Q2 2025	Q3 2025
Commercial Real Estate	$1,916.9	$1,854.3	$2,216.2
Commercial & Industrial	$670.7	$753.3	$907.4
Residential Real Estate	$567.1	$565.8	$590.6
Agricultural Real Estate	$259.6	$226.1	$272.1
Agricultural	$89.5	$95.0	$174.5
Consumer	$97.2	$106.2	$107.8
Total Loans HFI	$3,600.9	$3,600.7	$4,268.6

KPIs commentary:

Cost of total deposits rose to 1.98% (from 1.93%) and cost of interest-bearing deposits to 2.58% (+11 bps QoQ), largely reflecting NBC liabilities; loan yield rose to 7.18% (+23 bps QoQ) and NIM to 4.45% .
Brokered deposits declined to 3.0% of total; organic deposits up ~$37M QoQ .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Net Interest Margin (%)	Q4 2025	—	4.40–4.50%	New
Net Interest Margin (%)	FY 2026	—	4.20–4.35%	New
Provision for Credit Losses ($USD Millions)	Q4 2025	—	0.5–1.5	New
Provision for Credit Losses ($USD Millions)	FY 2026	—	8.0–10.0	New
Core Non-Interest Income ($USD Millions)	Q4 2025	—	8.50–9.0	New
Core Non-Interest Expense ($USD Millions)	Q4 2025	—	37.5–40.0	New
Effective Tax Rate (%)	Q4 2025	—	17–19	New
Avg Deposits ($USD Millions)	Q4 2025	—	5,000–5,100	New
Avg Loans ($USD Millions)	Q4 2025	—	4,250–4,300	New
Avg Earning Assets ($USD Millions)	Q4 2025	—	5,550–5,650	New
Net Interest Margin (%)	FY 2025	3.95–4.05% (full-year view from Q1)	—	Maintained earlier; superseded by Q4/Q26 views
Dividend per Share ($USD)	Quarterly	$0.15 prior [implied]	$0.18 declared (+20%)	Raised

Note: The Q3 presentation also compared realized Q3 metrics to internal range estimates (e.g., NIM 4.45% vs. 4.15–4.25%) .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 2025)	Previous Mentions (Q2 2025)	Current Period (Q3 2025)	Trend
M&A strategy	NBC announced; capital ready; active pipeline	NBC closed July; disciplined M&A; seller dynamics driven by age/ownership	NBC integrated; Frontier announced; sub debt reissued to fund growth	Scaling footprint; continued M&A execution
Net interest margin & asset mix	Core margin 4.27%; defend margin amid cuts	Core margin 4.17%; remixing boosts NII; guide maintenance	NIM 4.45%; normalized core ~4.35%; Q4 guide 4.40–4.50%	Improving; supported by accretion and repositioning
Deposit pricing/costs	Rational competition; mirror Fed moves	Some remaining repricing; competitive environment	Cost up modestly due to NBC; strategy consistently lowers higher-rate tiers	Stable execution; mix dilution from acquired liabilities
Loan growth vs. payoffs	+$131M Q1; pipelines strong	Production robust; payoffs elevated; pipelines up	Organic growth modest; NBC adds scale; pipelines ~$475M (75% prob)	Growth resuming; payoff normalization expected
Asset quality/QSR	NPAs down; watch QSR exposure	One large QSR to non-accrual; classified up but contained	NBC added $7M non-accrual; classified +$16.7M; legacy trends improving	Mixed: acquired portfolios add NPAs; legacy stabilizing
Macro/tariffs/inflation	Tariffs uncertain; added reserve conservatism	Outlook liability-neutral to rate cuts	Inflation still a concern; consumer tightening; liability floors in loans	Conservative stance maintained

Management Commentary

Strategic roadmap executed: “We have accomplished our goal via two mergers… enter both Oklahoma City and Omaha in 2025” .
Margin drivers and balance sheet neutral stance: “Margin improved 28 bps… purchase accounting 13 bps, non-accrual 7 bps… balance sheet remains neutrally positioned” .
Credit outlook: “ACL coverage is sufficient to absorb more than 10 years of current period annualized losses… credit trends remain stable” .
2026 ambition: “Positioning the company to earn $5 per share in 2026” .

Q&A Highlights

Deposit costs and pricing post-Fed cut: management consistently lowered top-tier rates in line with FOMC moves; competition rational; NBC liabilities drove QoQ cost lift .
Loan growth: production up, payoff normalization expected; Omaha growth potential post-Frontier; NBC clients leveraging larger hold limits .
Margin guide and levers: liability and asset repricing levers; loan rate floors provide cushion; Frontier funding mix to be optimized post-close .
Provision outlook: 2026 provision range reflects conservatism; excludes day-two CECL .
Securities portfolio role: ratio expected to remain mid-to-high teens of earning assets post M&A .

Estimates Context

S&P Global Consensus vs Actual (Q3 2025)	Consensus	Actual	Delta
Primary EPS (Normalized) ($USD)	0.99*	1.21 (core diluted EPS)	+0.22*
Diluted EPS (GAAP) ($USD)	—	-1.55	—
EBIT ($USD)	$15.5M*	($28.5M)*	Miss*
Net Income Normalized ($USD)	$18.9M*	($29.7M) GAAP	Miss*
Revenue ($USD)	$54.2M*	Not comparable for banks; NII $62.5M	N/A*

Values marked with an asterisk were retrieved from S&P Global. Note: For banks, S&P’s “Revenue” may not align with reported net interest income plus non-interest income; GAAP diluted EPS and normalized/core EPS differ markedly due to the $53.4M securities loss .

Implications:

Core EPS beat consensus; GAAP miss driven by deliberate bond portfolio loss. Expect estimate models to adjust for accretion normalization and lower core non-interest expense in Q4 .

Key Takeaways for Investors

Core profitability intact and improving: margin expansion (to 4.45%) and higher NII offset one-time losses; normalized NIM guidance supports sustained core earnings into Q4/FY26 .
Balance sheet scale and accretion: NBC added ~$665M loans/$808M deposits; Frontier adds Nebraska scale; watch CET1/TCE trajectories as integration proceeds .
Funding mix optimization: near-term deposit costs elevated from NBC; management targeting lower-cost funding and liability repricing; brokered deposits at 3% .
Credit manageable: NPAs/classified increased from NBC, but legacy trends improved; NCOs remain low; provisioning driven by day-two CECL .
Tactical repositioning payoff: bond portfolio sales raised asset yields from ~2.20% to ~5.00%; expect incremental NIM tailwinds in Q4 as accretion normalizes .
Shareholder returns: dividend raised 20%; buyback program renewed; sub debt reissued to fund strategic growth .
Trading setup: near-term narrative hinges on core earnings resilience versus GAAP noise; positive catalysts include Q4 NIM sustainment, deposit cost moderation, and Frontier approval/close .

Sources: Q3 2025 8-K/press release, investor presentation, and earnings call transcript . Values marked with an asterisk were retrieved from S&P Global via analyst estimates tools.

EQUITY BANCSHARES INC (EQBK)·Q3 2025 Earnings Summary