QCR Holdings, Inc. Announces Record Quarterly Net Income of $36.7 Million for the Third Quarter of 2025

Board Approves New Share Repurchase Program Authorization for Up to 1.7 Million Shares

Third Quarter 2025 Highlights

• Record third quarter net income of $36.7 million, or $2.16 per diluted share

• Record adjusted net income¹ of $36.9 million, or $2.17 per diluted share

• Net interest income growth of 18% annualized and NIM TEY¹ expansion of five basis points to 3.51%

• ROAA of 1.57% annualized

• Capital markets revenue of $23.8 million, up 141% on a linked-quarter basis

• Loan growth of 15% annualized

• Tangible book value per share¹ growth of $2.50, or 19% annualized

• Repurchased 115,735 shares, a total of 129,056 through October 20^th, 2025
  
  

MOLINE, Ill., Oct. 22, 2025 (GLOBE NEWSWIRE) -- QCR Holdings, Inc. (NASDAQ: QCRH) (the “Company”) today announced record quarterly net income of $36.7 million and diluted earnings per share (“EPS”) of $2.16 for the third quarter of 2025, compared to net income of $29.0 million and diluted EPS of $1.71 for the second quarter of 2025.

Adjusted net income¹ and adjusted diluted EPS¹ for the third quarter of 2025 were $36.9 million and $2.17, respectively, compared to $29.4 million and $1.73, respectively, for the second quarter of 2025 and $30.3 million, and $1.78 respectively for the third quarter of
2024.

“We delivered outstanding third quarter results, achieving record net income and strong EPS growth of 26% compared to the second quarter,” said Todd Gipple, President and Chief Executive Officer. “Our exceptional performance was driven by a strong rebound in capital markets revenue, as well as robust loan growth and continued net interest margin expansion that led to a significant increase in net interest income.”

Strong Margin Expansion Fuels Significant Net Interest Income Growth

Net interest income for the third quarter of 2025 totaled $64.8 million, an increase of $2.7 million, or 18% annualized, from the second quarter of 2025, driven by strong earning asset growth, expanded loan and investment yields, and a stable cost of funds. Net interest margin (“NIM”) was 3.00% and NIM on a tax-equivalent yield (“TEY”) basis¹ was 3.51% for the third quarter, as compared to 2.97% and 3.46% for the prior quarter, respectively.

“Our NIM TEY¹ increased five basis points from the second quarter of 2025, exceeding the high end of our guidance range,” said Nick Anderson, Chief Financial Officer. “Looking ahead, we anticipate continued margin expansion and are guiding to an increase in fourth quarter NIM TEY¹ ranging from 3 to 7 basis points, assuming no further Federal Reserve rate cuts,” added Mr. Anderson.

Robust Noninterest Income from Capital Markets and Wealth Management Revenue

Noninterest income for the third quarter of 2025 was $36.7 million, up 66% from $22.1 million in the second quarter of 2025. The Company generated $23.8 million of capital markets revenue in the third quarter of 2025 compared to $9.9 million in the prior quarter. Wealth Management revenue totaled $5.0 million for the quarter, representing an 8% increase from the second quarter of 2025 and a 15% annualized increase year-over-year.

“During the third quarter of 2025, activity rebounded sharply in our low-income housing tax credit (“LIHTC”) lending business, underscoring the continued demand for affordable housing and the strength of our seasoned team. Developers are actively navigating the broader macroeconomic challenges from earlier in the year, demonstrating resilience and a commitment to advancing their projects. We continue to view LIHTC lending as a highly durable, highly profitable, and differentiated line of business for QCRH, anchored by our deep network of developer relationships and the historically high-quality assets that our platform consistently delivers,” said Mr. Gipple.

“Our LIHTC lending team has worked incredibly hard to extend our market position the past three quarters, gaining additional projects from our long-term developer relationships and creating new relationships with 10 experienced LIHTC developer clients. These new clients are some of the best LIHTC developers in the country and this success will further extend our LIHTC lending platform. Given the strength of our pipeline, we are increasing our capital markets revenue guidance to be in a range of between $55 and $65 million over the next four quarters,” added Mr. Gipple.

Noninterest Expense Discipline Helps Drive Operating Leverage

Noninterest expense for the third quarter of 2025 totaled $56.6 million compared to $49.6 million for the second quarter of 2025 and $53.6 million for the third quarter of 2024. The $7.0 million linked-quarter increase was primarily due to robust capital markets revenue and loan growth in the quarter, which drove variable compensation higher. Professional and data processing expenses and occupancy and equipment expenses related to the Company’s digital transformation also contributed to the increase in noninterest expense.

The Company’s highly incentivized variable compensation structure is designed to enhance operating leverage and provide expense flexibility across changing revenue cycles. “For the third quarter, the Company’s efficiency ratio¹ of 55.78% was our lowest in four years. Compared to the first nine months of 2024, adjusted noninterest expenses¹ remain well controlled, up less than 1% on an annualized basis, while adjusted net income¹ has grown by 9% annualized,” said Mr. Anderson.

For the fourth quarter of 2025, the Company expects noninterest expense to be in the range of $52 to $55 million, which assumes capital markets revenue and loan growth are within their guidance ranges and includes costs for the digital transformation, including the successful completion of the first core operating system conversion in early October.

Loan Growth Accelerates in both LIHTC and Traditional Bank Lending

In the third quarter of 2025, the Company’s total loans and leases held for investment grew by $253.7 million, to $7.2 billion. “Loan growth was 17% annualized when adding back the impact from the planned runoff of m2 Equipment Finance (“m2”) loans and leases. Third quarter loan growth was driven by acceleration in both our LIHTC lending and traditional lending businesses. With a strong pipeline in place, we anticipate solid loan growth through year-end and are guiding to gross loan growth in a range of 10% to 15% in the final quarter of the year,” said Mr. Gipple.

Core Deposit Strength Continues

Total core deposits increased by $99.0 million, or 6% annualized from the second quarter, while average deposit balances increased $164.8 million. Year-to-date, core deposits have increased by $410.2 million, or 8% annualized. The deposit mix remained stable while total brokered deposits declined by $37.2 million. The Company’s total deposits have averaged $7.3 billion year-to-date, an increase of $536.0 million, or 8%.

“We continue to generate strong deposit growth across our markets. These results reflect the success of our relationship-driven strategy of growing core deposits, providing a solid funding base that supports future growth,” added Mr. Gipple.

Asset Quality Further Strengthens and Remains Excellent

The nonperforming assets (“NPAs”) to total assets ratio was 0.45% as of September 30, 2025, down one basis point from the prior quarter. NPAs totaled $42.7 million at the end of the third quarter of 2025, consistent with the prior quarter.

Total criticized loans decreased by $5.6 million on a linked-quarter basis. The ratio of criticized loans to total loans and leases as of September 30, 2025 decreased to 2.01% as compared to 2.16% as of June 30, 2025, and remains well below the Company’s long-term historical average.

The Company recorded a total provision for credit losses of $4.3 million during the quarter, which was up slightly from $4.0 million in the prior quarter. Net charge-offs were $4.2 million during the third quarter of 2025, a decrease of $2.1 million from the prior quarter driven by significantly lower m2 portfolio charge-offs. Credit loss expenses for the m2 portfolio are down 45%, or $4 million, and nonperforming assets are down 29% year-over-year, reflecting both the runoff of the higher-risk assets and the improved seasoning of the remaining portfolio. The allowance for credit losses to total loans held for investment was 1.24% as of September 30, 2025.

Continued Strong Tangible Book Value and Regulatory Capital

The Company’s tangible book value per share¹ (“TBV”) increased by $2.50, or 19% annualized, during the third quarter of 2025 due to the combination of strong earnings and improved accumulated other comprehensive losses partially offset by share repurchases.

As of September 30, 2025, the Company’s tangible common equity to tangible assets ratio (“TCE”)¹ increased five basis points to 9.97%. The improvement in TCE¹ was driven by strong earnings during the quarter. The total risk-based capital ratio decreased to 14.03% and the common equity tier 1 ratio decreased to 10.34% due to solid earnings growth during the quarter, offset by strong loan growth and share repurchases. By comparison, these ratios were 9.92%, 14.26%, and 10.43%, respectively, as of June 30, 2025. The Company remains committed to maintaining strong regulatory capital.

Opportunistic Share Repurchases and New Share Repurchase Plan Authorization

From the beginning of the third quarter through October 20^th, the Company returned $10.0 million of capital to shareholders with 129,056 shares repurchased at an average price of $77.49 per share. Additionally, the Company’s Board of Directors authorized a new share repurchase program on October 20, 2025, permitting the repurchase of up to 1,700,000 shares of its outstanding common stock, or approximately 10% of the outstanding shares as of September 30, 2025. This program replaces the Company’s prior repurchase program announced on May 19, 2022, which has been terminated.

“The opportunistic repurchases were completed at attractive valuation levels of TBV¹. The new share repurchase program authorization equips us with a flexible capital allocation tool, enabling us to continue repurchasing shares when it aligns with our strategic and financial objectives, underscoring our confidence in the long-term earnings power of the Company and our commitment to enhancing shareholder value,” said Mr. Gipple.

Conference Call Details
The Company will host an earnings call/webcast tomorrow, October 23, 2025, at 10:00 a.m. Central Time. Dial-in information for the call is toll-free: 888-346-9286 (international 412-317-5253). Participants should request to join the QCR Holdings, Inc. call. The event will be available for replay through October 30, 2025. The replay access information is 877-344-7529 (international 412-317-0088); access code 5245751. A webcast of the teleconference can be accessed on the Company’s News and Events page at www.qcrh.com. An archived version of the webcast will be available at the same location shortly after the live event has ended.

About Us
QCR Holdings, Inc., headquartered in Moline, Illinois, is a relationship-driven, multi-bank holding company serving the Quad Cities, Cedar Rapids, Cedar Valley, Des Moines/Ankeny and Springfield communities through its wholly owned subsidiary banks. The banks provide full-service commercial and consumer banking and trust and wealth management services. Quad City Bank & Trust Company, based in Bettendorf, Iowa, commenced operations in 1994, Cedar Rapids Bank & Trust Company, based in Cedar Rapids, Iowa, commenced operations in 2001, Community State Bank, based in Ankeny, Iowa, was acquired by the Company in 2016, and Guaranty Bank, based in Springfield, Missouri, was acquired by the Company in 2018. Additionally, the Company serves the Waterloo/Cedar Falls, Iowa community through Community Bank & Trust, a division of Cedar Rapids Bank & Trust Company. The Company has 36 locations in Iowa, Missouri, and Illinois. As of September 30, 2025, the Company had $9.6 billion in assets, $7.2 billion in loans and $7.4 billion in deposits. For additional information, please visit the Company’s website at www.qcrh.com.

Endnotes
¹Adjusted non-GAAP measurements of financial performance exclude non-core and/or nonrecurring income and expense items that management believes are not reflective of the anticipated future operation of the Company’s business. The Company believes these adjusted measurements provide a better comparison for analysis and may provide a better indicator of future performance. See GAAP to non-GAAP reconciliations.

Special Note Concerning Forward-Looking Statements. This document contains, and future oral and written statements of the Company and its management may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of the Company. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of the Company’s management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “bode”, “predict,” “suggest,” “project”, “appear,” “plan,” “intend,” “estimate,” ”annualize,” “may,” “will,” “would,” “could,” “should,” “likely,” “might,” “potential,” “continue,” “annualized,” “target,” “outlook,” as well as the negative forms of those words, or other similar expressions. Additionally, all statements in this document, including forward-looking statements, speak only as of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.

A number of factors, many of which are beyond the ability of the Company to control or predict, could cause actual results to differ materially from those in its forward-looking statements. These factors include, but are not limited to: (i) the strength of the local, state, national and international economies and financial markets, including effects of inflationary pressures, the threat or implementation of tariffs, trade wars and changes to immigration policy; (ii) changes in, and the interpretation and prioritization of, local, state and federal laws, regulations and governmental policies (including those concerning the Company’s general business); (iii) the economic impact of any future terrorist threats and attacks, widespread disease or pandemics, acts of war or threats thereof (including the Russian invasion of Ukraine and ongoing conflicts in the Middle East), or other adverse events that could cause economic deterioration or instability in credit markets, and the response of the local, state and national governments to any such adverse external events; (iv) new or revised accounting policies and practices, as may be adopted by state and federal regulatory agencies, the FASB, the Securities and Exchange Commission (the “SEC”) or the PCAOB; (v) the imposition of tariffs or other governmental policies impacting the value of products produced by the Company’s commercial borrowers; (vi) increased competition in the financial services sector, including from non-bank competitors such as credit unions, fintech companies, and digital asset service providers and the inability to attract new customers; (vii) rapid technological changes implemented by us and our third-party vendors, including the development and implementation of tools incorporating artificial intelligence; (viii) unexpected results of acquisitions, including failure to realize the anticipated benefits of the acquisitions and the possibility that transaction and integration costs may be greater than anticipated; (ix) the loss of key executives and employees, talent shortages and employee turnover; (x) changes in consumer spending; (xi) unexpected outcomes and costs of existing or new litigation or other legal proceedings and regulatory actions involving the Company; (xii) the economic impact on the Company and its customers of climate change, natural disasters and exceptional weather occurrences such as tornadoes, floods and blizzards; (xiii) fluctuations in the value of securities held in our securities portfolio, including as a result of changes in interest rates; (xiv) credit risk and risks from concentrations (by type of borrower, geographic area, collateral and industry) within our loan portfolio and large loans to certain borrowers (including CRE loans); (xv) the overall health of the local and national real estate market; (xvi) the ability to maintain an adequate level of allowance for credit losses on loans; (xvii) the concentration of large deposits from certain clients who have balances above current FDIC insurance limits and who may withdraw deposits to diversify their exposure; (xviii) the ability to successfully manage liquidity risk, which may increase dependence on non-core funding sources such as brokered deposits, and may negatively impact the Company’s cost of funds; (xix) the level of non-performing assets on our balance sheet; (xx) interruptions involving our information technology and communications systems or third-party servicers; (xxi) the occurrence of fraudulent activity, breaches or failures of our third-party vendors’ information security controls or cybersecurity-related incidents, including as a result of sophisticated attacks using artificial intelligence and similar tools or as a result of insider fraud; (xxii) changes in the interest rates and repayment rates of the Company’s assets; (xxiii) the effectiveness of the Company’s risk management framework, (xxiv) the effects of the current U.S. government shutdown, including the impact of prolonged closures or staffing reductions at government agencies effecting our business (for instance, the U.S. Department of Housing and Urban Development involvement with our LIHTC lending business), and (xxv) the ability of the Company to manage the risks associated with the foregoing. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. Additional information concerning the Company and its business, including additional factors that could materially affect the Company’s financial results, is included in the Company’s filings with the SEC.

Contact:
Nick W. Anderson
Chief Financial Officer
(309) 743-7707
nanderson@qcrh.com

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