Oct 29, 2026 earnings call — Loan growth rebound and margin improvement
Net income was $11.6 million for the third quarter, a 25% increase versus Q3 2025.
Revenue $0.0B (est $0.0B) · EPS $0.67 (est $0.67)
Key quotes
"For the quarter ended 9/30/2026, our loan portfolio increased 1.5% when compared to the second quarter."
"We have zero past dues over 30 days, no other real estate, and no non-accruals."
"Yeah, I think the rate hikes certainly slow down our net interest margin improvement. We have a fairly high deposit beta base, and with each incremental increase, that will slow down our net interest margin improvement."
Analyst Q&A 3
Loan growth, margin, and problem loans
Q (Brendan Nosal · Hovde): He asked what changed to allow the strong loan growth and how growth looks going forward. He also asked about the near-term margin impact of recent rate hikes, the status of criticized assets, and a run-rate tax rate.
A: Management said entering Q3 they expected about $90 million in payoffs and now see about $30 million that will pay off by year-end; new production and some large transactions have largely covered payoffs and the pipeline looks good. They said rate hikes will slow net interest margin improvement but asset repricing over the next 12 months should help; criticized credits are well-secured, making payments, and being monitored. They said this quarter's tax rate would be a good run rate.
"I think the rate hikes certainly slow down our net interest margin improvement." — Jane Funk (CFO)
Which markets drive loan growth
Q (Adam Kroll · Piper Sandler): He asked whether any one market is driving loan growth and for details on fixed-rate loan repricings. He also asked about deposit beta assumptions and expectations for Q4 expense run rate and 2027 spending plans.
A: They said no single market is driving growth; Des Moines/Central Iowa is about half the portfolio but the pipeline is spread across markets, and recent larger closed deals included $25 million from Des Moines, $23 million from Iowa City, and $22 million from the Minnesota market. They said over the next 12 months about $550 million of fixed-rate loans will reprice with a weighted average around 450-ish basis points. They said deposit betas will likely be similar to the last cycle, Q4 expenses should be similar to this year, and technology/product spending may increase in 2027–2028 though specifics are not yet determined.
"Over the next 12 months, we've got about $550 million in fixed rate loans that we'll reprice, and I think the weighted average rate is somewhere around 450-ish basis points." — Jane Funk (CFO)
New loan yields and deposit competition
Q (Brendan Nosal · Hovde): He asked where new loan production yields are coming in and how the competitive environment for core deposits has changed since the Fed raised rates in September.
A: They said new loan production is coming on the sheet in the high sixes. They said deposit competition has heated back up the last couple of months, deposit pricing is really intense after market signals of rate hikes, betas are likely to be on the higher side similar to the prior cycle, and they are focused on deposit sensitivity and retaining and growing the deposit base.
"The competition has certainly heated back up quite a bit the last couple of months." — Jane Funk (CFO)