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NICOLET BANKSHARES INC (NIC)·Q2 2025 Earnings Summary

Executive Summary

  • Record quarter: Net income rose to $36.0m and diluted EPS to $2.34, up 10% and 12% QoQ, respectively; ROAA reached 1.62% and NIM expanded 14 bps to 3.72% as stable rates and solid loan growth supported spread and volume .
  • Broad-based operating strength: Net interest income grew $4m QoQ to $75.1m; noninterest income increased $2.4m on seasonal mortgage revenue and favorable deferred compensation asset marks; efficiency improved to 51.79% .
  • Funding mix improved: Core deposits increased $68m QoQ while brokered deposits fell $99m; time deposits ticked down and noninterest-bearing demand balances rose QoQ, supporting cost of funds control (up just 3 bps) .
  • Capital return accelerated: Board raised the quarterly dividend to $0.32 (+14%) in May and the company repurchased $30m of stock (257k shares) in Q2 (following $26m in Q1); buyback authorization was increased by $60m on April 15 .

What Went Well and What Went Wrong

  • What Went Well

    • Spread and earning asset momentum: NIM rose 14 bps QoQ to 3.72% as asset yields increased 15 bps to 5.82% while interest-bearing liability costs increased only 3 bps to 2.86% .
    • Core franchise resilience: Core deposits grew $68m QoQ as brokered deposits declined $99m, improving the funding mix; management emphasized “strong performance and continued consistency” and top-decile profitability .
    • Operating leverage: Noninterest income increased on seasonal mortgages and market-driven deferred comp asset gains while efficiency improved to 51.79% .

  • What Went Wrong

    • Expense pressure from incentives/marks: Personnel expense rose $2.6m QoQ on higher incentives and deferred comp liability marks; total noninterest expense increased $2.1m QoQ .
    • Slight total deposit decline: Total deposits fell $31m QoQ due to actively reducing brokered deposits, partly offset by core deposit growth; requires continued execution to sustain funding gains .
    • Modest provision build: Provision for credit losses was $1.05m (vs. $1.50m in Q1), while ACL/loans held flat at 1.00%; asset quality remained solid but bears monitoring amid loan growth .

Financial Results

Metric (USD Millions, unless noted)Q2 2024Q4 2024Q1 2025Q2 2025
Net Interest Income$65.342 $71.550 $71.206 $75.109
Noninterest Income$19.609 $20.858 $18.223 $20.633
Total Operating Revenue (NII + Noninterest)$84.951 $92.408 $89.429 $95.742
Provision for Credit Losses$1.350 $1.000 $1.500 $1.050
Noninterest Expense$46.853 $48.205 $47.787 $49.919
Income Before Tax$36.748 $43.203 $40.142 $44.773
Net Income$29.273 $34.480 $32.592 $36.035
Diluted EPS ($)$1.92 $2.19 $2.08 $2.34
Adjusted Diluted EPS ($, Non-GAAP)$1.88 $2.17 $2.10 $2.35
Net Interest Margin (%)3.42% 3.61% 3.58% 3.72%
ROAA (%)1.39% 1.57% 1.49% 1.62%
Efficiency Ratio (%)55.24% 52.17% 52.94% 51.79%

Notes: Adjusted EPS and efficiency reflect company definitions and reconciliations .

Segment/Balance Composition (Period-End)

  • Loans (selected): Commercial-based loans $5,252m vs. $5,187m (Q1’25) vs. $4,970m (Q2’24); Retail-based loans $1,587m vs. $1,559m (Q1’25) vs. $1,559m (Q2’24); Total loans $6,839m vs. $6,746m (Q1’25) vs. $6,529m (Q2’24) .
  • Deposits (selected): Noninterest DDA $1,800m vs. $1,689m (Q1’25) vs. $1,765m (Q2’24); Interest-bearing demand $1,267m vs. $1,239m vs. $1,094m; Time $1,769m vs. $1,861m vs. $1,657m; Total deposits $7,542m vs. $7,572m vs. $7,241m; Brokered deposits $758m vs. $857m vs. $808m; Core deposits $6,783m vs. $6,715m vs. $6,433m .

Key Credit/Capital KPIs

  • Nonperforming assets/Assets: 0.32% (Q2’25) vs. 0.33% (Q1’25) vs. 0.34% (Q2’24); ACL/Loans: 1.00% across periods; Net charge-offs to avg loans: 0.02% across periods .
  • Book value per share: $79.74 (Q2’25) vs. $78.11 (Q1’25) vs. $73.03 (Q2’24); Tangible book value per share: $53.94 vs. $52.59 vs. $46.84 .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent Guidance/ActionChange
Dividend per shareQ2 2025 (payable 6/13/25)$0.28 (Q1’25)$0.32Raised 14%
Share repurchase authorizationAnnounced 4/15/25~$10m remaining under prior authorization (as of 3/31/25)Board increased authorization by $60mExpanded authorization
Quantitative revenue/margin/expense guidanceQ3/Q4 2025NoneNoneMaintained “no formal guidance” stance (community banks typically refrain)

Earnings Call Themes & Trends

Note: We could not retrieve the Q2 2025 earnings call transcript. MarketBeat lists the call on July 15, 2025 at 12:30 PM ET .

TopicPrevious Mentions (Q4 2024, Q1 2025)Current Period (Q2 2025)Trend
Net interest margin and funding costsQ4: NIM up 10 bps QoQ on lower deposit costs; cost of funds down 21 bps; asset yields dipped 8 bps . Q1: NIM down 3 bps QoQ; liability costs down 7 bps; NIB DDA lower .NIM +14 bps to 3.72%; asset yield +15 bps; liability cost +3 bps; strong loan growth .Improving since Q1; positive spread dynamics.
Core deposits vs. brokeredQ4: Mix shifted toward interest-bearing; total deposits +$144m QoQ . Q1: Core +$62m; brokered +$107m QoQ .Core +$68m; brokered −$99m QoQ; total deposits −$31m .Mix improving (lower brokered).
Mortgage/fee incomeQ4: Mortgage +$0.5m QoQ; noninterest income −$2m QoQ . Q1: Seasonal mortgage decline .Seasonal mortgage rebound; deferred comp asset marks favorable .Seasonal upturn aided by markets.
Asset qualityStable NPAs ~0.33%; ACL 1.00%; net charge-offs negligible . Q1 stable .NPAs/Assets 0.32%; ACL/loans 1.00%; charge-offs negligible .Stable/benign.
Capital return & M&A postureQ4: Initiated buybacks; positive on 2025 M&A landscape . Q1: “High-level M&A conversations,” prioritizing buybacks near-term .$30m repurchases in Q2; dividend raised to $0.32 in May .Ongoing capital returns; optionality on M&A.
Management toneConfident, top-quartile profitability .“Strong performance and continued consistency… top decile of community banks” .Confident/constructive.

Management Commentary

  • “Our quarterly results again demonstrated strong performance and continued consistency in a volatile market… Our net interest margin continued to grow at a healthy pace as rates remained stable, and our profitability metrics are likely to place us near the top decile of community banks.” — Mike Daniels, Chairman, President & CEO .
  • “We remain focused at all levels of Nicolet to keep this momentum going and continue to create shared success for our customers, communities, shareholders, and each other.” — Mike Daniels .
  • Q1 strategic stance on capital: “While we continue to have high-level M&A conversations… our Board increased our stock buyback authorization, and affirmed that the best acquisition we can make… is in our own company through share repurchases.” — Mike Daniels .

Q&A Highlights

  • We were unable to source the Q2 2025 call transcript; MarketBeat recorded the call occurred July 15, 2025 at 12:30 PM ET .

Estimates Context

  • EPS: Actual $2.35 vs. consensus $2.18, +$0.17 beat; 5 estimates*.
  • Revenue: Actual $94.692m vs. consensus $72.887m, +$21.805m beat; 4 estimates*.
MetricQ2 2025 Actual*Q2 2025 Consensus*Surprise*# of Estimates*
Primary EPS$2.35$2.18+$0.175
Revenue ($m)$94.692$72.887+$21.8054

Values retrieved from S&P Global.*

Key Takeaways for Investors

  • NIM inflection plus earning asset growth is driving operating leverage; modest liability cost increases (+3 bps) against +15 bps asset yields should remain a positive earnings driver near-term if funding mix continues to improve .
  • Funding mix discipline is visible: core deposits up and brokered down; continued reduction of brokered balances would be a catalyst for lower funding costs and stronger NIM resilience through 2H25 .
  • Fee tailwinds emerged seasonally in mortgages and via market marks; watch sustainability into Q3 as deferred comp marks reverse with markets and mortgage seasonality fades .
  • Capital deployment is shareholder-friendly (dividend raise + aggressive buybacks); with ROAA at 1.62% and stable credit, capital returns likely remain a support to EPS and TBVPS trajectory .
  • Credit quality remains a non-issue (NPAs/Assets 0.32%, ACL/Loans 1.00%); negligible net charge-offs suggest low loss content, supporting stable provisioning into 2H25 absent macro shocks .
  • Estimate resets: Given the sizable revenue and EPS beats, buyside should expect upward revisions unless management signals conservatism on funding costs or fee normalization in Q3*.
  • Monitoring list: deposit beta behavior as rates evolve, sustainability of core growth vs. brokered runoff, and any incremental color on M&A optionality from management in future events .

Supporting detail and sources:

  • Q2 2025 8-K and press release: performance metrics, balance sheet and income statement detail, ratios, and composition ; -.
  • Prior quarters for trend analysis: Q1 2025 8-K/press (operations, NIM, deposits, buyback authorization) -; Q4 2024 8-K (quarter/year detail, NIM, efficiency) -.
  • Dividend actions: May 20, 2025 dividend raise to $0.32 (press and SEC 8-K) .