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NICOLET BANKSHARES INC (NIC)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 delivered another record quarter: net income $41.735M and diluted EPS $2.73 vs. $2.34 in Q2 and $2.10 in Q3 2024, driven by NIM expansion and stronger noninterest income .
  • Net interest margin expanded 14 bps sequentially to 3.86% as asset yields ticked up and funding costs fell; brokered deposits declined while core deposits rose sharply, improving mix .
  • Wall Street consensus EPS and revenue were exceeded; EPS of $2.66 (adjusted) and revenue near $102M both beat S&P Global estimates; magnitude suggests upward revisions to forward models are likely* (see Estimates Context).
  • Capital return remained active: $21M buybacks (155,393 shares) and a previously announced $0.32 dividend payable Sept 15; management tone is confident, emphasizing top‑decile profitability and momentum .

What Went Well and What Went Wrong

  • What Went Well

    • Margin/Spread: NIM rose to 3.86% (+14 bps QoQ) with asset yields +3 bps and interest‑bearing liability costs −10 bps; net interest income grew to $79.264M (+$4.155M QoQ) .
    • Funding mix improvement: Core deposits up $223M QoQ (+13% annualized) while brokered deposits fell $153M; overall deposits rose $70M QoQ to $7.611B .
    • Noninterest income strength: Total noninterest income increased to $23.619M (+$2.986M QoQ), led by wealth (+$0.818M) and mortgage (+$0.661M), plus favorable equity securities valuation gains .

  • What Went Wrong

    • Expense creep: Noninterest expense ticked up to $50.088M (+$0.169M QoQ), with personnel costs +$0.323M; however, mix improved with declines in several categories .
    • Provisioning stayed active: Provision for credit losses was $0.950M (vs. $1.050M in Q2), reflecting prudent reserving despite stable asset quality .
    • Limited formal guidance: The company did not provide quantitative forward guidance; investors must extrapolate from margin commentary and funding trends .

Management quotes (tone/confidence):

  • “We just produced some of the best quarterly financial metrics in our history… top decile of banks in the country.” — Mike Daniels, Chairman, President & CEO .

Financial Results

MetricQ1 2025Q2 2025Q3 2025
Net Interest Income ($USD Millions)$71.206 $75.109 $79.264
Noninterest Income ($USD Millions)$18.223 $20.633 $23.619
Provision for Credit Losses ($USD Millions)$1.500 $1.050 $0.950
Total Noninterest Expense ($USD Millions)$47.787 $49.919 $50.088
Net Income ($USD Millions)$32.592 $36.035 $41.735
Diluted EPS ($USD)$2.08 $2.34 $2.73
Net Interest Margin (%)3.58% 3.72% 3.86%
Efficiency Ratio (%)52.94% 51.79% 49.10%

Segment/KPI breakdown

KPIQ2 2025Q3 2025
Total Loans (Period-End, $USD Millions)$6,839.141 $6,874.711
Total Deposits (Period-End, $USD Millions)$7,541.673 $7,611.465
Core Customer Deposits (Period-End, $USD Millions)$6,783.198 $7,006.076
Brokered Deposits (Period-End, $USD Millions)$758.475 $605.389
Nonperforming Assets ($USD Millions)$28.616 $28.230
NPA / Total Assets (%)0.32% 0.31%

Loan composition (selected categories)

CategoryQ2 2025 ($USD Millions)Q3 2025 ($USD Millions)
Commercial & Industrial$1,412.621 $1,415.841
Agricultural$1,346.924 $1,378.070
Construction & Land Development$298.122 $324.209
Residential First Mortgage$1,205.841 $1,199.512
Retail & Other$43.374 $43.896

Estimates vs. Actuals (S&P Global)

MetricQ3 2025 ConsensusQ3 2025 ActualBeat/Miss
EPS (Adjusted) ($USD)2.37*2.66 Beat*
Revenue ($USD Millions)76.94*101.93*Beat*
EPS # of Estimates5*——
Revenue # of Estimates4*——

Values retrieved from S&P Global.*

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Dividend per share (quarterly)Q3 2025—$0.32 payable Sept 15, 2025 Maintained/Communicated
Share Repurchase AuthorizationApril 2025+$60M authorized increment OngoingMaintained
NIM OutlookQ4 2025—Management aims to hold NIM roughly flat with potential minor giveback (“a bip or two”) amid rate cuts Qualitative outlook
Formal Revenue/Margin/OpEx/Tax GuidanceQ3 2025Not providedNot providedN/A

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 2025)Previous Mentions (Q2 2025)Current Period (Q3 2025)Trend
Net Interest Margin trajectoryNIM 3.58%; slight pressure from higher interest expense NIM 3.72%; expansion on loan growth and stable rates NIM 3.86%; further expansion on higher yields and lower funding costs Improving, expected flat near‑term
Deposit mix (core vs. brokered)Core deposits +$62M from YE’24 Core +$68M; brokered −$99M QoQ Core +$223M QoQ; brokered −$153M Mix strengthening toward core
Loan growth focus+$119M from YE’24; emphasis on C&I +$94M; mostly commercial-based +$36M; construction & agricultural led Moderate growth, tilted to CRE‑construction/ag
Asset qualityNPA ~0.33% of assets; charge-offs negligible NPA 0.32%; stable NPA 0.31%; stable; charge-offs negligible Stable/benign
Capital returnBuybacks $26M (Q1) Buybacks $30M (Q2) Buybacks $21M (Q3); dividend $0.32 Ongoing repurchases & dividend
Strategic/M&ABoard increased buyback authorization; cautious on M&A —Announced acquisition of MidWestOne (10/24) with 35–40% EPS accretion modeled and Durbin impact in 2027 Transformational; scale-up, conservative assumptions

Management Commentary

  • “Return on Average Assets and Return on Average Tangible Common Equity… should easily put us in the top decile of banks in the country.” — Mike Daniels, CEO .
  • “Net interest margin… up 14 bps… yield on interest‑earning assets increased 3 bps… cost of interest‑bearing liabilities decreased 10 bps.” — Q3 press release .
  • “Core deposit growth of $223 million… partly offset by a $153 million decrease in brokered deposits.” — Q3 press release .
  • On M&A strategy and margin outlook: “With a couple of rate cuts, we are hoping to stay flat [NIM]. We might give a bip or two back…” — M&A call Q&A .
  • On deal accretion: “Fully phased-in EPS accretion of approximately 35%–40%… Durbin impact roughly $8.5 million beginning in 2027.” — CFO Phil Moore .

Q&A Highlights

  • Margin durability: Management aims to keep NIM roughly flat in Q4 despite expected rate cuts; recent expansion viewed as “solid core number” .
  • Culture/integration: Emphasis on “lead local” and relationship banking to export Nicolet’s culture across Iowa, Twin Cities, and Denver; integration plan staged with systems conversion post legal close .
  • Revenue synergies: Wealth management and employee benefits cited as largest cross‑sell opportunities; conservative cost‑save assumptions (25%) with no modeled revenue synergies .
  • Durbin impact and scale: Anticipated ~$8.5M interchange headwind post $10B; majority of “$10B bank” cost infrastructure already in place .

Estimates Context

  • S&P Global consensus EPS was $2.37 vs. actual adjusted EPS $2.66 (beat), and revenue consensus $76.94M vs. actual $101.93M (beat)*.
  • Magnitude of beats, combined with stronger margin and core deposit trends, implies potential upward revisions to out‑quarter estimates as mix and NIM dynamics persist*.

Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Strong beat vs. consensus on EPS and revenue; momentum supported by NIM expansion and improved funding mix* .
  • Core deposit inflows and brokered deposit reductions de‑risk funding; expect continued margin resilience near‑term .
  • Noninterest income drivers (wealth, mortgage) showed positive sequential trends, diversifying revenue .
  • Capital return remains robust (buybacks and dividend); TBV dilution from repurchases modest amid strong ROATCE .
  • Asset quality stable with NPA at 0.31% of assets and negligible net charge‑offs; reserve ratio steady at 1.00% of loans .
  • Post‑quarter M&A announcement is a medium‑term catalyst: modeled accretion, broader footprint, and potential synergies in wealth and C&I, with Durbin impact factored .
  • Trading implications: near‑term strength likely anchored by NIM/earnings beats and M&A narrative; watch Q4 NIM trajectory and funding mix for confirmation, and monitor regulatory/operational milestones on the MidWestOne integration .

Additional references on market reaction and beats:

  • Earnings beat coverage and revenue surprise .
  • MarketBeat summary of EPS/revenue beats and call timing .
  • Nasdaq brief on profit advance and net interest income .

Notes:

  • No dedicated Q3 2025 “earnings‑call‑transcript” was available in the document set; management commentary and Q&A were derived from the October 24 M&A Announcement call –.
  • Cross‑references: All quantitative figures in tables are sourced from the Q3, Q2, and Q1 2025 earnings 8‑Ks/press releases, except S&P Global estimate fields as noted with an asterisk – – – – –.