Wintrust Financial (NASDAQ: WTFC) posts stronger Q1 2026 profit and balance sheet growth
Filing Impact
Filing Sentiment
Form Type
10-Q
Wintrust Financial reported solid Q1 2026 results with net income of $227,388 thousand, up from $189,039 thousand a year earlier. Basic EPS rose to $3.26 from $2.73, driven by higher net interest income of $579,024 thousand and stronger non‑interest revenue.
Total assets reached $72,157,433 thousand, loans grew to $54,071,292 thousand, and deposits increased to $58,914,382 thousand, showing ongoing balance sheet expansion. The provision for credit losses increased to $29,594 thousand, and net charge‑offs rose, reflecting conservative credit provisioning.
Comprehensive income was held back by a $71,054 thousand other comprehensive loss, mainly from unrealized losses on available‑for‑sale securities and derivatives as interest rates and market conditions shifted. Shareholders’ equity still improved to $7,378,100 thousand, supported by retained earnings and Series F preferred stock.
Positive
- None.
Negative
- None.
Insights
Wintrust posts strong Q1 earnings with higher credit costs and OCI pressure.
Wintrust Financial delivered notable profit growth in Q1 2026. Net income rose to $227,388 thousand from $189,039 thousand, while net interest income increased to $579,024 thousand. Both loans at $54,071,292 thousand and deposits at $58,914,382 thousand continued to expand.
Credit costs moved higher. The provision for credit losses increased to $29,594 thousand versus $23,963 thousand, and net charge‑offs reached about $18,418 thousand. The total allowance for credit losses climbed to $471,591 thousand, indicating a cautious stance on potential future losses.
Capital and liquidity stayed robust, with shareholders’ equity at $7,378,100 thousand. However, other comprehensive loss of $71,054 thousand from unrealized losses on securities and derivatives weighed on comprehensive income. Future filings will show how credit trends and market rates affect these reserves and valuation swings.
Key Figures
Net income: $227,388 thousand
Basic EPS: $3.26
Net interest income: $579,024 thousand
+5 more
8 metrics
Net income
$227,388 thousand
Three months ended March 31, 2026
Basic EPS
$3.26
Three months ended March 31, 2026
Net interest income
$579,024 thousand
Three months ended March 31, 2026
Total assets
$72,157,433 thousand
As of March 31, 2026
Total loans
$54,071,292 thousand
As of March 31, 2026
Total deposits
$58,914,382 thousand
As of March 31, 2026
Provision for credit losses
$29,594 thousand
Three months ended March 31, 2026
Allowance for credit losses
$471,591 thousand
As of March 31, 2026
Key Terms
allowance for credit losses, mortgage servicing rights, held-to-maturity securities, other comprehensive (loss) income, +1 more
5 terms
allowance for credit losses financial
"The Company's allowance for credit losses consists of the allowance for loan losses, the allowance for unfunded commitment losses and the allowance for held-to-maturity debt security losses."
Allowance for credit losses is a reserve set aside by a financial institution to cover potential losses from borrowers who may not repay their loans. It acts like a safety net, helping the institution prepare for loans that might turn sour. For investors, it signals how cautious the institution is about the quality of its loans and potential risks to its financial health.
mortgage servicing rights financial
"The Company recognizes MSR assets upon the sale of residential real estate loans to external third parties when it retains the obligation to service the loans."
Mortgage servicing rights are the contractual right to collect mortgage payments, manage escrow accounts, handle customer service and delinquency actions on a pool of home loans, in exchange for a portion of the loan’s payments. They matter to investors because their value behaves like a revenue stream that can rise or fall with interest rates and borrower behavior — similar to owning a toll bridge where income depends on traffic volume and maintenance costs — and thus affect a lender’s earnings and risk profile.
held-to-maturity securities financial
"Held-to-maturity securities, net of allowance for credit losses | $ | 3,270,207"
Held-to-maturity securities are debt investments—like bonds—that a company or investor intends and is able to keep until they mature and repay their face value. Think of them as money you lock in like a fixed-term certificate: they matter to investors because their value is recorded at amortized cost rather than market price, so they provide predictable interest income and reduce balance-sheet volatility but limit flexibility to sell.
other comprehensive (loss) income financial
"Total other comprehensive (loss) income | ( 71,054 ) | 98,320"
premium finance receivables financial
"Premium finance receivables—property & casualty | 7,890,331 | 8,183,416 | 7,239,862"
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________________________
FORM 10-Q
_________________________________________
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarterly period ended March 31, 2026
OR
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the transition period from to
Commission File Number 001-35077
_____________________________________
(Exact name of registrant as specified in its charter)
| (State of incorporation or organization) | (I.R.S. Employer Identification No.) | ||||
(Address of principal executive offices)
(847 ) 939-9000
(Registrant’s telephone number, including area code)
| Title of Each Class | Ticker Symbol | Name of Each Exchange on Which Registered | ||||||
Depositary Shares, Each Representing a 1/1,000th Interest in a Share of | ||||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☑ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):
| ☑ | Accelerated filer | ☐ | |||||||||||||||||||||
| Non-accelerated filer | ☐ | (Do not check if a smaller reporting company) | Smaller reporting company | ||||||||||||||||||||
| Emerging growth company | |||||||||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
Common Stock — no par value, 67,447,756 shares, as of April 30, 2026
Table of Contents
TABLE OF CONTENTS
| Page | ||||||||
| PART I. — FINANCIAL INFORMATION | ||||||||
| ITEM 1. | Financial Statements | 1 | ||||||
| ITEM 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 44 | ||||||
| ITEM 3. | Quantitative and Qualitative Disclosures About Market Risk | 68 | ||||||
| ITEM 4. | Controls and Procedures | 70 | ||||||
| PART II. — OTHER INFORMATION | ||||||||
| ITEM 1. | Legal Proceedings | 70 | ||||||
| ITEM 1A. | Risk Factors | 70 | ||||||
| ITEM 2. | Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities | 71 | ||||||
| ITEM 3. | Defaults Upon Senior Securities | NA | ||||||
| ITEM 4. | Mine Safety Disclosures | NA | ||||||
| ITEM 5. | Other Information | 71 | ||||||
| ITEM 6. | Exhibits | 71 | ||||||
Signatures | 72 | |||||||
Table of Contents
PART I
ITEM 1. FINANCIAL STATEMENTS
WINTRUST FINANCIAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CONDITION | |||||||||||||||||
| (Unaudited) | (Unaudited) | ||||||||||||||||
| (Dollars in thousands, except per share data) | March 31, 2026 | December 31, 2025 | March 31, 2025 | ||||||||||||||
| Assets | |||||||||||||||||
| Cash and due from banks | $ | $ | $ | ||||||||||||||
| Federal funds sold and securities purchased under resale agreements | |||||||||||||||||
| Interest-bearing deposits with banks | |||||||||||||||||
| Available-for-sale securities, at fair value | |||||||||||||||||
Held-to-maturity securities, at amortized cost, net of allowance for credit losses of $ | |||||||||||||||||
| Equity securities with readily determinable fair value | |||||||||||||||||
| Federal Home Loan Bank and Federal Reserve Bank stock | |||||||||||||||||
| Mortgage loans held-for-sale, at fair value | |||||||||||||||||
| Loans, net of unearned income | |||||||||||||||||
| Allowance for loan losses | ( | ( | ( | ||||||||||||||
| Net loans | |||||||||||||||||
| Premises, software and equipment, net | |||||||||||||||||
| Lease investments, net | |||||||||||||||||
| Accrued interest receivable and other assets | |||||||||||||||||
| Receivable on unsettled securities sales | |||||||||||||||||
| Goodwill | |||||||||||||||||
| Other acquisition-related intangible assets | |||||||||||||||||
| Total assets | $ | $ | $ | ||||||||||||||
| Liabilities and Shareholders’ Equity | |||||||||||||||||
| Deposits: | |||||||||||||||||
| Non-interest-bearing | $ | $ | $ | ||||||||||||||
| Interest-bearing | |||||||||||||||||
| Total deposits | |||||||||||||||||
| Federal Home Loan Bank advances | |||||||||||||||||
| Other borrowings | |||||||||||||||||
| Subordinated notes | |||||||||||||||||
| Junior subordinated debentures | |||||||||||||||||
| Accrued interest payable and other liabilities | |||||||||||||||||
| Total liabilities | |||||||||||||||||
| Shareholders’ Equity: | |||||||||||||||||
Preferred stock, no par value; | |||||||||||||||||
Series D - $ | |||||||||||||||||
Series E - $ | |||||||||||||||||
Series F - $ | |||||||||||||||||
Common stock, no par value; $ | |||||||||||||||||
| Surplus | |||||||||||||||||
Treasury stock, at cost, | ( | ( | ( | ||||||||||||||
| Retained earnings | |||||||||||||||||
| Accumulated other comprehensive loss | ( | ( | ( | ||||||||||||||
| Total shareholders’ equity | |||||||||||||||||
| Total liabilities and shareholders’ equity | $ | $ | $ | ||||||||||||||
See accompanying notes to unaudited consolidated financial statements.
1
Table of Contents
WINTRUST FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
| Three Months Ended | |||||||||||||||||||||||
| (Dollars in thousands, except per share data) | March 31, 2026 | March 31, 2025 | |||||||||||||||||||||
| Interest income | |||||||||||||||||||||||
| Interest and fees on loans | $ | $ | |||||||||||||||||||||
| Mortgage loans held-for-sale | |||||||||||||||||||||||
| Interest-bearing deposits with banks | |||||||||||||||||||||||
| Federal funds sold and securities purchased under resale agreements | |||||||||||||||||||||||
| Investment securities | |||||||||||||||||||||||
| Trading account securities | |||||||||||||||||||||||
| Federal Home Loan Bank and Federal Reserve Bank stock | |||||||||||||||||||||||
| Brokerage customer receivables | |||||||||||||||||||||||
| Total interest income | |||||||||||||||||||||||
| Interest expense | |||||||||||||||||||||||
| Interest on deposits | |||||||||||||||||||||||
| Interest on Federal Home Loan Bank advances | |||||||||||||||||||||||
| Interest on other borrowings | |||||||||||||||||||||||
| Interest on subordinated notes | |||||||||||||||||||||||
| Interest on junior subordinated debentures | |||||||||||||||||||||||
| Total interest expense | |||||||||||||||||||||||
| Net interest income | |||||||||||||||||||||||
| Provision for credit losses | |||||||||||||||||||||||
| Net interest income after provision for credit losses | |||||||||||||||||||||||
| Non-interest income | |||||||||||||||||||||||
| Wealth management | |||||||||||||||||||||||
| Mortgage banking | |||||||||||||||||||||||
| Service charges on deposit accounts | |||||||||||||||||||||||
| (Losses) gains on investment securities, net | ( | ||||||||||||||||||||||
| Fees from covered call options | |||||||||||||||||||||||
| Trading gains (losses), net | ( | ||||||||||||||||||||||
| Operating lease income, net | |||||||||||||||||||||||
| Other | |||||||||||||||||||||||
| Total non-interest income | |||||||||||||||||||||||
| Non-interest expense | |||||||||||||||||||||||
| Salaries and employee benefits | |||||||||||||||||||||||
| Software and equipment | |||||||||||||||||||||||
| Operating lease equipment | |||||||||||||||||||||||
| Occupancy, net | |||||||||||||||||||||||
| Data processing | |||||||||||||||||||||||
| Advertising and marketing | |||||||||||||||||||||||
| Professional fees | |||||||||||||||||||||||
| Amortization of other acquisition-related intangible assets | |||||||||||||||||||||||
| FDIC insurance | |||||||||||||||||||||||
| Other real estate owned expense, net | |||||||||||||||||||||||
| Other | |||||||||||||||||||||||
| Total non-interest expense | |||||||||||||||||||||||
| Income before taxes | |||||||||||||||||||||||
| Income tax expense | |||||||||||||||||||||||
| Net income | $ | $ | |||||||||||||||||||||
| Preferred stock dividends | |||||||||||||||||||||||
| Net income applicable to common shares | $ | $ | |||||||||||||||||||||
| Net income per common share—Basic | $ | $ | |||||||||||||||||||||
| Net income per common share—Diluted | $ | $ | |||||||||||||||||||||
| Cash dividends declared per common share | $ | $ | |||||||||||||||||||||
| Weighted average common shares outstanding | |||||||||||||||||||||||
| Dilutive potential common shares | |||||||||||||||||||||||
| Average common shares and dilutive common shares | |||||||||||||||||||||||
See accompanying notes to unaudited consolidated financial statements.
2
Table of Contents
WINTRUST FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)
| Three Months Ended | |||||||||||||||||||||||
| (In thousands) | March 31, 2026 | March 31, 2025 | |||||||||||||||||||||
| Net income | $ | $ | |||||||||||||||||||||
| Unrealized (losses) gains on available-for-sale securities | |||||||||||||||||||||||
| Before tax | ( | ||||||||||||||||||||||
| Tax effect | ( | ||||||||||||||||||||||
| Net of tax | ( | ||||||||||||||||||||||
| Reclassification of net losses on available-for-sale securities included in net income | |||||||||||||||||||||||
| Before tax | ( | ( | |||||||||||||||||||||
| Tax effect | |||||||||||||||||||||||
| Net of tax | ( | ( | |||||||||||||||||||||
| Reclassification of amortization of unrealized gains on investment securities transferred to held-to-maturity from available-for-sale | |||||||||||||||||||||||
| Before tax | |||||||||||||||||||||||
| Tax effect | ( | ( | |||||||||||||||||||||
| Net of tax | |||||||||||||||||||||||
| Net unrealized (losses) gains on available-for-sale securities | ( | ||||||||||||||||||||||
| Unrealized (losses) gains on derivative instruments | |||||||||||||||||||||||
| Before tax | ( | ||||||||||||||||||||||
| Tax effect | ( | ||||||||||||||||||||||
| Net unrealized (losses) gains on derivative instruments | ( | ||||||||||||||||||||||
| Foreign currency adjustment | |||||||||||||||||||||||
| Before tax | ( | ( | |||||||||||||||||||||
| Tax effect | |||||||||||||||||||||||
| Net foreign currency adjustment | ( | ( | |||||||||||||||||||||
| Total other comprehensive (loss) income | ( | ||||||||||||||||||||||
| Comprehensive income | $ | $ | |||||||||||||||||||||
See accompanying notes to unaudited consolidated financial statements.
3
Table of Contents
WINTRUST FINANCIAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (UNAUDITED) | |||||||||||||||||||||||||||||||||||||||||
| (Dollars in thousands, except per share data) | Preferred stock | Common stock | Surplus | Treasury stock | Retained earnings | Accumulated other comprehensive loss | Total shareholders’ equity | ||||||||||||||||||||||||||||||||||
| Balance at January 1, 2025 | $ | $ | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
| Other comprehensive income, net of tax | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Cash dividends declared on common stock, $ | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
Dividends on Series D preferred stock, $ | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
| Common stock issued for: | |||||||||||||||||||||||||||||||||||||||||
| Exercise of stock options | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Restricted stock awards | — | ( | ( | — | — | ( | |||||||||||||||||||||||||||||||||||
| Employee stock purchase plan | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Director compensation plan | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Balance at March 31, 2025 | $ | $ | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
| Balance at January 1, 2026 | $ | $ | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
| Other comprehensive loss, net of tax | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
Cash dividends declared on common stock, $ | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
Dividends on Series F preferred stock, $ | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
| Common stock issued for: | |||||||||||||||||||||||||||||||||||||||||
| Exercise of stock options | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Restricted stock awards | — | ( | ( | — | — | ( | |||||||||||||||||||||||||||||||||||
| Employee stock purchase plan | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Director compensation plan | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Balance at March 31, 2026 | $ | $ | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
See accompanying notes to unaudited consolidated financial statements.
4
Table of Contents
WINTRUST FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
| Three Months Ended | |||||||||||
| (In thousands) | March 31, 2026 | March 31, 2025 | |||||||||
| Operating Activities: | |||||||||||
| Net income | $ | $ | |||||||||
| Adjustments to reconcile net income to net cash provided by operating activities | |||||||||||
| Provision for credit losses | |||||||||||
| Depreciation, amortization and accretion, net | |||||||||||
| Stock-based compensation expense | |||||||||||
| Accretion of discount on securities, net | ( | ( | |||||||||
| Amortization (accretion) of discount and deferred fees on loans, net | ( | ||||||||||
| Mortgage servicing rights fair value changes | |||||||||||
| Non-designated derivatives fair value changes, net | |||||||||||
| Originations and purchases of mortgage loans held-for-sale | ( | ( | |||||||||
| Early buy-out exercises of mortgage loans held-for-sale guaranteed by U.S. government agencies, net of subsequent paydowns or payoffs | ( | ||||||||||
| Proceeds from sales of mortgage loans held-for-sale | |||||||||||
| Bank owned life insurance (“BOLI”) gains | ( | ( | |||||||||
| Decrease in trading securities, net | |||||||||||
| Decrease in brokerage customer receivables, net | |||||||||||
| Gains on mortgage loans sold | ( | ( | |||||||||
| Losses (gains) on investment securities, net, and dividend reinvestment on equity securities | ( | ||||||||||
| Losses on sales of premises and equipment, net | |||||||||||
| (Gains) losses on sales and fair value adjustments of other real estate owned, net | ( | ||||||||||
| Decrease in accrued interest receivable and other assets, net | |||||||||||
| Decrease in accrued interest payable and other liabilities, net | ( | ( | |||||||||
| Net Cash Provided by Operating Activities | |||||||||||
| Investing Activities: | |||||||||||
| Proceeds from payments and maturities of available-for-sale securities | |||||||||||
| Proceeds from payments, maturities and calls of held-to-maturity securities | |||||||||||
| Proceeds from sales of equity securities with readily determinable fair value | |||||||||||
| Proceeds from sales and capital distributions of equity securities without readily determinable fair value | |||||||||||
| Purchases of available-for-sale securities | ( | ( | |||||||||
| Purchases of equity securities with readily determinable fair value | ( | ( | |||||||||
| Purchases of equity securities without readily determinable fair value | ( | ( | |||||||||
| Purchases of Federal Home Loan Bank and Federal Reserve Bank stock, net | ( | ( | |||||||||
| Distributions from investments in partnerships, net | |||||||||||
| Proceeds from sales of other real estate owned | |||||||||||
| Decrease in interest-bearing deposits with banks, net | |||||||||||
| Increase in loans, net | ( | ( | |||||||||
| Redemption of BOLI | |||||||||||
| (Purchases) sales of premises and equipment, net | ( | ||||||||||
| Net Cash Used for Investing Activities | ( | ( | |||||||||
| Financing Activities: | |||||||||||
| Increase in deposit accounts, net | |||||||||||
| Decrease in other borrowings, net | ( | ( | |||||||||
| Issuance of common shares resulting from the exercise of stock options, employee stock purchase plan and director compensation plan | |||||||||||
| Common stock repurchases for tax withholdings related to stock-based compensation | ( | ( | |||||||||
| Dividends paid | ( | ( | |||||||||
| Net Cash Provided by Financing Activities | |||||||||||
| Net Increase in Cash and Cash Equivalents | |||||||||||
| Cash and Cash Equivalents at Beginning of Period | |||||||||||
| Cash and Cash Equivalents at End of Period | $ | $ | |||||||||
See accompanying notes to unaudited consolidated financial statements.
5
Table of Contents
WINTRUST FINANCIAL CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(1) Basis of Presentation
The interim consolidated financial statements of Wintrust Financial Corporation and its subsidiaries (collectively, “Wintrust” or the “Company”) presented herein are unaudited, but in the opinion of management, reflect all necessary adjustments of a normal or recurring nature for a fair presentation of results as of the dates and for the periods covered by the interim consolidated financial statements.
The accompanying interim consolidated financial statements are unaudited and do not include information or footnotes necessary for a complete presentation of financial condition, results of operations or cash flows in accordance with U.S. generally accepted accounting principles (“GAAP”). The interim unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 (“2025 Form 10-K”). Operating results reported for the period are not necessarily indicative of the results which may be expected for the entire year. Reclassifications of certain prior period amounts have been made to conform to the current period presentation.
The preparation of the financial statements requires management to make estimates, assumptions and judgments that affect the reported amounts of assets and liabilities. Management believes that the estimates made are reasonable; however, changes in estimates may be required if economic or other conditions develop differently from management’s expectations. Certain policies and accounting principles inherently have a greater reliance on the use of estimates, assumptions and judgments and as such have a greater possibility of producing results that could be materially different than originally reported. Management views critical accounting policies to be those which are highly dependent on subjective or complex judgments, estimates and assumptions, and where changes in those estimates and assumptions could have a significant impact on the financial statements. Management currently views the determination of the allowance for credit losses, including the allowance for loan losses, the allowance for unfunded commitment losses and the allowance for held-to-maturity securities losses, estimations of fair value, the valuations required for impairment testing of goodwill, the valuation and accounting for derivative instruments and income taxes as the accounting areas that require the most subjective and complex judgments, and as such could be the most subject to revision as new information becomes available. Descriptions of the Company’s significant accounting policies are included in Note (1) “Summary of Significant Accounting Policies” of the 2025 Form 10-K. In preparation of these financial statements, subsequent events were evaluated through the time the financial statements were issued. Financial statements are considered issued when they are widely distributed to all shareholders and other financial statement users or filed with the SEC.
(2) Recent Accounting Developments
Disaggregation of Income Statement Expenses
In November 2024, the FASB issued Accounting Standards Update (“ASU”) No. 2024-03, “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses,” which requires public business entities to disclose additional information about specific expense categories including employee compensation, depreciation, intangible asset amortization, etc., as well as qualitative descriptions of certain expenses, in the notes to the financial statements. This guidance is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. The guidance is to be applied either prospectively or retrospectively. Early adoption is permitted. The Company is currently evaluating the impact of adopting this new guidance on the consolidated financial statements.
Induced Conversions of Convertible Debt Instruments
In November 2024, the FASB issued ASU No. 2024-04, “Debt – Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments” to clarify the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. The Company adopted ASU No. 2024-04 as of January 1, 2026. Adoption of this standard did not impact the Company’s consolidated financial statements.
6
Table of Contents
Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity
In May 2025, the FASB issued ASU No. 2025-03, “Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity” which requires an entity involved in an acquisition transaction affected by primarily exchanging equity interests when the legal acquirer is a variable interest entity that meets the definition of a business, to consider specific factors when determining which entity is the accounting acquirer. This guidance is effective for fiscal years beginning after December 15, 2026, including interim periods therein, and is to be applied on a prospective basis to any acquisition transaction that occurs after the initial application date. Early adoption is permitted. The Company is currently evaluating the impact of adopting this new guidance on the consolidated financial statements.
Measurement of Credit Losses for Accounts Receivable and Contract Assets
In July 2025, the FASB issued ASU No. 2025-05, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets” which provides public business entities with a practical expedient—and private companies an accounting policy election—when estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under Topic Accounting Standards Codification (“ASC”) 606. In developing reasonable and supportable forecasts—if an entity elects the practical expedient—it assumes that current conditions as of the balance sheet date do not change for the remaining life of the assets in scope. The Company adopted ASU No. 2025-05 as of January 1, 2026. Adoption of this standard did not impact the Company’s consolidated financial statements as the Company did not elect the practical expedient.
Targeted Improvements to the Accounting for Internal-Use Software
In September 2025, the FASB issued ASU No. 2025-06, “Intangibles – Goodwill and Other Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software” which removes all references to prescriptive and sequential software development stages, instead requiring capitalization of software costs when management has authorized and committed to funding the software project, and it is probable that the project will be completed and the software will be used to perform the function needed. This guidance is effective for fiscal years beginning after December 15, 2027, including interim periods therein, and can be applied either prospectively, retrospectively, or through a modified transition approach. Early adoption is permitted at the beginning of an annual reporting period. The Company is currently evaluating the impact of adopting this new guidance on the consolidated financial statements.
Derivatives Scope Refinements & Scope Clarification for Share-Based Noncash Consideration
In September 2025, the FASB issued ASU No. 2025-07, “Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606): Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract” which covers two separate issues. Issue 1 adds a scope exception to exclude from derivative accounting non-exchange-traded contracts with underlyings linked to the occurrence or nonoccurrence of an event. Issue 2 clarifies that entities should apply the guidance in ASC 606—on noncash consideration—to a contract with share-based noncash consideration from a customer for the transfer of goods or services. This guidance is effective for fiscal years beginning after December 15, 2026, including interim periods therein, and can be applied either on a prospective or modified retrospective basis. Early adoption is permitted. The Company is currently evaluating the impact of adopting this new guidance on the consolidated financial statements.
Credit Losses - Purchased Loans
In November 2025, the FASB issued ASU No. 2025-08, “Financial Instruments - Credit Losses (Topic 326): Purchased Loans” which expands the population of acquired financial assets subject to the gross-up approach under Topic 326. Loans—excluding credit cards—acquired without credit deterioration and deemed “seasoned” are purchased seasoned loans and accounted for using the gross-up approach at acquisition. The Company early adopted ASU No. 2025-08 as of January 1, 2026. Adoption of this standard did not impact the Company’s consolidated financial statements in the current period as no acquisition occurred.
Hedge Accounting Improvements
In November 2025, the FASB issued ASU No. 2025-09, “Derivatives and Hedging (Topic 815): Hedge Accounting Improvements” which clarifies certain aspects of the guidance on hedge accounting and addresses several incremental hedge accounting issues arising from the global reference rate reform initiative. For public business entities, this guidance is effective for fiscal years beginning after December 15, 2026, including interim periods therein, and should be applied on a prospective basis for all hedging relationships. Early adoption is permitted. The Company is currently evaluating the impact of adopting this new guidance on the consolidated financial statements.
7
Table of Contents
Interim Reporting Scope Improvements
In December 2025, the FASB issued ASU No. 2025-11, “Interim Reporting (Topic 270): Narrow-Scope Improvements” which clarifies interim disclosure requirements and the applicability of Topic 270, resulting in a comprehensive list of interim disclosures required by GAAP. For public business entities, this guidance is effective for fiscal years beginning after December 15, 2027, including interim periods therein, and can be applied either on a prospective or retrospective basis. Early adoption is permitted. The Company is currently evaluating the impact of adopting this new guidance on the consolidated financial statements.
(3) Business Combinations
On August 1, 2024, the Company completed its previously announced acquisition of Macatawa Bank Corporation (“Macatawa”), the parent company of Macatawa Bank. Pursuant to the terms of the merger, each common share of Macatawa outstanding at the time of merger was converted into the right to receive 0.137 shares of Wintrust common stock, with cash paid in lieu of fractional shares. As a result, the Company issued approximately 4.7 million shares of common stock, the fair value of consideration paid was $499.3 million. Macatawa operates full-service branches located throughout communities in Kent, Ottawa and northern Allegan counties in the state of Michigan. Macatawa offers a full range of banking, retail and commercial lending, wealth management and ecommerce services to individuals, businesses and governmental entities. As of August 1, 2024, Macatawa had fair values of approximately $2.9 billion in assets, $2.3 billion in deposits and $1.3 billion in loans. In conjunction with the acquisition, the Company recorded $53.7 million discount on acquired loans, $33.5 million discount on securities and recorded total intangibles of $253.0 million. As of the first quarter of 2025, the purchase accounting was finalized and is no longer subject to change.
(4) Cash and Cash Equivalents
For purposes of the Consolidated Statements of Cash Flows, the Company considers cash and cash equivalents to include cash on hand, cash items in the process of collection, non-interest bearing amounts due from correspondent banks, federal funds sold and securities purchased under resale agreements with original maturities of three months or less. These items are included within the Company’s Consolidated Statements of Condition as cash and due from banks, and federal funds sold and securities purchased under resale agreements.
8
Table of Contents
(5) Investment Securities
The following tables are a summary of the investment securities portfolios as of the dates shown:
| March 31, 2026 | |||||||||||||||||||||||
| (In thousands) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||||||||
| Available-for-sale securities | |||||||||||||||||||||||
| U.S. Treasury | $ | $ | $ | $ | |||||||||||||||||||
| U.S. government agencies | ( | ||||||||||||||||||||||
| Municipal | ( | ||||||||||||||||||||||
| Corporate notes: | |||||||||||||||||||||||
| Financial issuers | ( | ||||||||||||||||||||||
| Other | |||||||||||||||||||||||
Mortgage-backed: (1) | |||||||||||||||||||||||
| Residential mortgage-backed securities | ( | ||||||||||||||||||||||
| Commercial (multi-family) mortgage-backed securities | ( | ||||||||||||||||||||||
| Collateralized mortgage obligations | ( | ||||||||||||||||||||||
| Total available-for-sale securities | $ | $ | $ | ( | $ | ||||||||||||||||||
| Held-to-maturity securities | |||||||||||||||||||||||
| U.S. government agencies | $ | $ | $ | ( | $ | ||||||||||||||||||
| Municipal | ( | ||||||||||||||||||||||
Mortgage-backed: (1) | |||||||||||||||||||||||
| Residential mortgage-backed securities | ( | ||||||||||||||||||||||
| Commercial (multi-family) mortgage-backed securities | ( | ||||||||||||||||||||||
| Collateralized mortgage obligations | ( | ||||||||||||||||||||||
| Corporate notes | ( | ||||||||||||||||||||||
| Total held-to-maturity securities | $ | $ | $ | ( | $ | ||||||||||||||||||
| Less: Allowance for credit losses | ( | ||||||||||||||||||||||
| Held-to-maturity securities, net of allowance for credit losses | $ | ||||||||||||||||||||||
| Equity securities with readily determinable fair value | $ | $ | $ | ( | $ | ||||||||||||||||||
(1)None of our mortgage-backed securities are subprime.
9
Table of Contents
| December 31, 2025 | |||||||||||||||||||||||
| Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
| Available-for-sale securities | |||||||||||||||||||||||
| U.S. Treasury | $ | $ | $ | $ | |||||||||||||||||||
| U.S. government agencies | ( | ||||||||||||||||||||||
| Municipal | ( | ||||||||||||||||||||||
| Corporate notes: | |||||||||||||||||||||||
| Financial issuers | ( | ||||||||||||||||||||||
| Other | ( | ||||||||||||||||||||||
Mortgage-backed: (1) | |||||||||||||||||||||||
| Residential mortgage-backed securities | ( | ||||||||||||||||||||||
| Commercial (multi-family) mortgage-backed securities | ( | ||||||||||||||||||||||
| Collateralized mortgage obligations | ( | ||||||||||||||||||||||
| Total available-for-sale securities | $ | $ | $ | ( | $ | ||||||||||||||||||
| Held-to-maturity securities | |||||||||||||||||||||||
| U.S. government agencies | $ | $ | $ | ( | $ | ||||||||||||||||||
| Municipal | ( | ||||||||||||||||||||||
Mortgage-backed: (1) | |||||||||||||||||||||||
| Residential Mortgage-backed securities | ( | ||||||||||||||||||||||
| Commercial (multi-family) mortgage-backed securities | ( | ||||||||||||||||||||||
| Collateralized mortgage obligations | ( | ||||||||||||||||||||||
| Corporate notes | ( | ||||||||||||||||||||||
| Total held-to-maturity securities | $ | $ | $ | ( | $ | ||||||||||||||||||
| Less: Allowance for credit losses | ( | ||||||||||||||||||||||
| Held-to-maturity securities, net of allowance for credit losses | $ | ||||||||||||||||||||||
| Equity securities with readily determinable fair value | $ | $ | $ | ( | $ | ||||||||||||||||||
(1)None of our mortgage-backed securities are subprime.
10
Table of Contents
| March 31, 2025 | |||||||||||||||||||||||
| Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
| Available-for-sale securities | |||||||||||||||||||||||
| U.S. Treasury | $ | $ | $ | $ | |||||||||||||||||||
| U.S. government agencies | ( | ||||||||||||||||||||||
| Municipal | ( | ||||||||||||||||||||||
| Corporate notes: | |||||||||||||||||||||||
| Financial issuers | ( | ||||||||||||||||||||||
| Other | ( | ||||||||||||||||||||||
Mortgage-backed: (1) | |||||||||||||||||||||||
| Residential mortgage-backed securities | ( | ||||||||||||||||||||||
| Commercial (multi-family) mortgage-backed securities | ( | ||||||||||||||||||||||
| Collateralized mortgage obligations | ( | ||||||||||||||||||||||
| Total available-for-sale securities | $ | $ | $ | ( | $ | ||||||||||||||||||
| Held-to-maturity securities | |||||||||||||||||||||||
| U.S. government agencies | $ | $ | $ | ( | $ | ||||||||||||||||||
| Municipal | ( | ||||||||||||||||||||||
Mortgage-backed: (1) | |||||||||||||||||||||||
| Residential mortgage-backed securities | ( | ||||||||||||||||||||||
| Commercial (multi-family) mortgage-backed securities | ( | ||||||||||||||||||||||
| Collateralized mortgage obligations | ( | ||||||||||||||||||||||
| Corporate notes | ( | ||||||||||||||||||||||
| Total held-to-maturity securities | $ | $ | $ | ( | $ | ||||||||||||||||||
| Less: Allowance for credit losses | ( | ||||||||||||||||||||||
| Held-to-maturity securities, net of allowance for credit losses | $ | ||||||||||||||||||||||
| Equity securities with readily determinable fair value | $ | $ | $ | ( | $ | ||||||||||||||||||
(1)None of our mortgage-backed securities are subprime.
Equity securities without readily determinable fair values totaled $69.3 million as of March 31, 2026. Equity securities without readily determinable fair values are included as part of accrued interest receivable and other assets in the Company’s Consolidated Statements of Condition. The Company monitors its equity investments without readily determinable fair values to identify potential transactions that may indicate an observable price change in orderly transactions for the identical or a similar investment of the same issuer, requiring adjustment to its carrying amount. During the three months ended March 31, 2026, the Company recorded no 20,000 related to such observable price changes. The Company conducts a quarterly assessment of its equity securities without readily determinable fair values to determine whether impairment exists in such securities, considering, among other factors, the nature of the securities, financial condition of the issuer and expected future cash flows. During the three months ended March 31, 2026 and March 31, 2025, the Company recorded no
11
Table of Contents
The following table presents the portion of the Company’s available-for-sale investment securities portfolios that have gross unrealized losses, reflecting the length of time that individual securities have been in a continuous unrealized loss position at March 31, 2026:
| Continuous unrealized losses existing for less than 12 months | Continuous unrealized losses existing for greater than 12 months | Total | |||||||||||||||||||||||||||||||||
| (In thousands) | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | |||||||||||||||||||||||||||||
| Available-for-sale securities | |||||||||||||||||||||||||||||||||||
| U.S. government agencies | $ | $ | $ | $ | ( | $ | $ | ( | |||||||||||||||||||||||||||
| Municipal | ( | ( | ( | ||||||||||||||||||||||||||||||||
| Corporate notes: | |||||||||||||||||||||||||||||||||||
| Financial issuers | ( | ( | |||||||||||||||||||||||||||||||||
Mortgage-backed: (1) | |||||||||||||||||||||||||||||||||||
| Residential mortgage-backed securities | ( | ( | ( | ||||||||||||||||||||||||||||||||
| Commercial (multi-family) mortgage-backed securities | ( | ( | ( | ||||||||||||||||||||||||||||||||
| Collateralized mortgage obligations | ( | ( | ( | ||||||||||||||||||||||||||||||||
| Total available-for-sale securities | $ | $ | ( | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||
(1)None of our mortgage-backed securities are subprime.
The Company conducts a regular assessment of its investment securities to determine whether securities are experiencing credit losses. Factors for consideration include the nature of the securities, credit ratings or financial condition of the issuer, the extent of the unrealized loss, expected cash flows, market conditions and the Company’s ability to hold the securities through the anticipated recovery period.
The Company does not consider available-for-sale securities with unrealized losses at March 31, 2026 to be experiencing credit losses and recognized no resulting allowance for credit losses for such individually assessed credit losses. The Company does not intend to sell these investments and it is more likely than not that the Company will not be required to sell these investments before recovery of the amortized cost bases, which may be the maturity dates of the securities. The unrealized losses within each category have occurred as a result of changes in interest rates, market spreads and market conditions subsequent to purchase. Available-for-sale securities with continuous unrealized losses existing for more than twelve months at March 31, 2026 were primarily mortgage-backed securities with unrealized losses due to increased market rates subsequent to the date the securities were purchased.
See Note (7) “Allowance for Credit Losses” in Item 1 of this report for further discussion regarding any credit losses associated with held-to-maturity securities at March 31, 2026.
The following table provides information as to the amount of gross gains and losses, adjustments and impairment on investment securities recognized in earnings and proceeds received through the sale or call of investment securities:
| Three months ended March 31, | |||||||||||||||||||||||
| (In thousands) | 2026 | 2025 | |||||||||||||||||||||
| Realized gains on investment securities | $ | $ | |||||||||||||||||||||
| Realized losses on investment securities | ( | ( | |||||||||||||||||||||
| Net realized gains (losses) on investment securities | ( | ||||||||||||||||||||||
| Unrealized gains on equity securities with readily determinable fair value | |||||||||||||||||||||||
| Unrealized losses on equity securities with readily determinable fair value | ( | ( | |||||||||||||||||||||
| Net unrealized (losses) gains on equity securities with readily determinable fair value | ( | ||||||||||||||||||||||
| Downward adjustments of equity securities without readily determinable fair values | ( | ||||||||||||||||||||||
| (Losses) gains on investment securities, net | $ | ( | $ | ||||||||||||||||||||
12
Table of Contents
The amortized cost and fair value of available-for-sale and held-to-maturity investment securities as of March 31, 2026, December 31, 2025 and March 31, 2025, by contractual maturity, are shown in the following table. Contractual maturities may differ from actual maturities as borrowers may have the right to call or repay obligations with or without call or prepayment penalties. Mortgage-backed securities are not included in the maturity categories in the following maturity summary as actual maturities may differ from contractual maturities because the underlying mortgages may be called or prepaid without penalties:
| March 31, 2026 | December 31, 2025 | March 31, 2025 | |||||||||||||||||||||||||||||||||
| (In thousands) | Amortized Cost | Fair Value | Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||||||||||||||||||||||
| Available-for-sale securities | |||||||||||||||||||||||||||||||||||
| Due in one year or less | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Due in one to five years | |||||||||||||||||||||||||||||||||||
| Due in five to ten years | |||||||||||||||||||||||||||||||||||
| Due after ten years | |||||||||||||||||||||||||||||||||||
| Mortgage-backed | |||||||||||||||||||||||||||||||||||
| Total available-for-sale securities | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Held-to-maturity securities | |||||||||||||||||||||||||||||||||||
| Due in one year or less | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Due in one to five years | |||||||||||||||||||||||||||||||||||
| Due in five to ten years | |||||||||||||||||||||||||||||||||||
| Due after ten years | |||||||||||||||||||||||||||||||||||
| Mortgage-backed | |||||||||||||||||||||||||||||||||||
| Total held-to-maturity securities | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Less: Allowance for credit losses | ( | ( | ( | ||||||||||||||||||||||||||||||||
| Held-to-maturity securities, net of allowance for credit losses | $ | $ | $ | ||||||||||||||||||||||||||||||||
Securities having a carrying value of $9.4 billion at March 31, 2026 as well as securities having a carrying value of $8.6 billion and $7.0 billion at December 31, 2025 and March 31, 2025, respectively, were pledged as collateral for public deposits, trust deposits, Federal Home Loan Bank (“FHLB”) advances, Federal Reserve Bank (“FRB”) discount window, securities sold under repurchase agreements and derivatives. At March 31, 2026, there were no securities of a single issuer, other than U.S. government-sponsored agency securities, which exceeded 10% of shareholders’ equity.
13
Table of Contents
(6) Loans
The following table shows the Company’s loan portfolio by category as of the dates shown:
| March 31, | December 31, | March 31, | |||||||||||||||
| (Dollars in thousands) | 2026 | 2025 | 2025 | ||||||||||||||
| Balance: | |||||||||||||||||
| Commercial | $ | $ | $ | ||||||||||||||
| Commercial real estate | |||||||||||||||||
| Home equity | |||||||||||||||||
| Residential real estate | |||||||||||||||||
| Premium finance receivables—property & casualty | |||||||||||||||||
| Premium finance receivables—life insurance | |||||||||||||||||
| Consumer and other | |||||||||||||||||
| Total loans, net of unearned income | $ | $ | $ | ||||||||||||||
| Mix: | |||||||||||||||||
| Commercial | % | % | % | ||||||||||||||
| Commercial real estate | |||||||||||||||||
| Home equity | |||||||||||||||||
| Residential real estate | |||||||||||||||||
| Premium finance receivables—property & casualty | |||||||||||||||||
| Premium finance receivables—life insurance | |||||||||||||||||
| Consumer and other | |||||||||||||||||
| Total loans, net of unearned income | % | % | % | ||||||||||||||
The Company’s loan portfolio is generally comprised of loans to consumers and small to medium-sized businesses, which, for the commercial and commercial real estate portfolios, are located primarily within the geographic market areas that the banks serve. Various niche lending businesses, including franchise lending and insurance agency lending, operate on a national level. The premium finance receivables portfolios are made to customers throughout the United States and Canada. The Company strives to maintain a loan portfolio that is diverse in terms of loan type, industry, borrower, and geographic concentrations. Such diversification reduces the exposure to economic downturns that may occur in different segments of the economy or in different industries.
Certain premium finance receivables are recorded net of unearned income. The unearned income portions of such premium finance receivables were $260.0 million at March 31, 2026, $268.6 million at December 31, 2025 and $261.1 million at March 31, 2025.
Total loans, excluding purchased credit deteriorated (“PCD”) loans, include net deferred loan fees and costs and fair value purchase accounting adjustments totaling $93.3 million at March 31, 2026, $77.9 million at December 31, 2025 and $80.1 million at March 31, 2025.
It is the policy of the Company to review each prospective credit in order to determine the appropriateness and, when required, the adequacy of security or collateral necessary to obtain when making a loan. The type of collateral, when required, will vary from liquid assets to real estate. The Company seeks to ensure access to collateral, in the event of default, through adherence to state lending laws and the Company’s credit monitoring procedures.
(7) Allowance for Credit Losses
In accordance with ASC 326, the Company is required to measure the allowance for credit losses of financial assets with similar risk characteristics on a collective or pooled basis. In considering the segmentation of financial assets measured at amortized cost into pools, the Company considered various risk characteristics in its analysis. Generally, the segmentation utilized represents the level at which the Company develops and documents its systematic methodology to determine the allowance for credit losses for the financial assets held at amortized cost, specifically the Company's loan portfolio and debt securities classified as held-to-maturity. Descriptions of the Company’s loan portfolio segments and major debt security types are included in Note (5) “Allowance for Credit Losses” of the 2025 Form 10-K.
14
Table of Contents
In accordance with ASC 326, the Company elected to not measure an allowance for credit losses on accrued interest. As such accrued interest is written off in a timely manner when deemed uncollectible. Any such write-off of accrued interest will reverse previously recognized interest income. In addition, the Company elected to not include accrued interest within presentation and disclosures of the carrying amount of financial assets held at amortized cost. This election is applicable to the various disclosures included within the Company's financial statements. Accrued interest related to financial assets held at amortized cost is included within accrued interest receivable and other assets within the Company's Consolidated Statements of Condition and totaled $326.0 million at March 31, 2026, $312.2 million at December 31, 2025, and $335.4 million at March 31, 2025.
The tables below show the aging of the Company’s loan portfolio by the segmentation noted above at March 31, 2026, December 31, 2025 and March 31, 2025:
| As of March 31, 2026 | 90+ days and still accruing | 60-89 days past due | 30-59 days past due | ||||||||||||||||||||||||||||||||
| (In thousands) | Nonaccrual | Current | Total Loans | ||||||||||||||||||||||||||||||||
| Loan Balances (includes PCD): | |||||||||||||||||||||||||||||||||||
| Commercial | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Commercial real estate | |||||||||||||||||||||||||||||||||||
| Construction and development | |||||||||||||||||||||||||||||||||||
| Non-construction | |||||||||||||||||||||||||||||||||||
| Home equity | |||||||||||||||||||||||||||||||||||
| Residential real estate, excluding early buy-out loans | |||||||||||||||||||||||||||||||||||
| Premium finance receivables—property & casualty | |||||||||||||||||||||||||||||||||||
| Premium finance receivables—life insurance | |||||||||||||||||||||||||||||||||||
| Consumer and other | |||||||||||||||||||||||||||||||||||
| Total loans, net of unearned income, excluding early buy-out loans | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Early buy-out loans guaranteed by U.S. government agencies (1) | |||||||||||||||||||||||||||||||||||
| Total loans, net of unearned income | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
(1)Early buy-out loans are insured or guaranteed by the Federal Housing Administration (FHA) or the U.S. Department of Veterans Affairs, subject to indemnifications and insurance limits for certain loans.
| As of December 31, 2025 | 90+ days and still accruing | 60-89 days past due | 30-59 days past due | ||||||||||||||||||||||||||||||||||||||
| (In thousands) | Nonaccrual | Current | Total Loans | ||||||||||||||||||||||||||||||||||||||
| Loan Balances (includes PCD): | |||||||||||||||||||||||||||||||||||||||||
| Commercial | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||
| Commercial real estate | |||||||||||||||||||||||||||||||||||||||||
| Construction and development | |||||||||||||||||||||||||||||||||||||||||
| Non-construction | |||||||||||||||||||||||||||||||||||||||||
| Home equity | |||||||||||||||||||||||||||||||||||||||||
| Residential real estate, excluding early buy-out loans | |||||||||||||||||||||||||||||||||||||||||
| Premium finance receivables—property & casualty | |||||||||||||||||||||||||||||||||||||||||
| Premium finance receivables—life insurance | |||||||||||||||||||||||||||||||||||||||||
| Consumer and other | |||||||||||||||||||||||||||||||||||||||||
| Total loans, net of unearned income, excluding early buy-out loans | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||
Early buy-out loans guaranteed by U.S. government agencies (1) | |||||||||||||||||||||||||||||||||||||||||
| Total loans, net of unearned income | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||
(1)Early buy-out loans are insured or guaranteed by the Federal Housing Administration (FHA) or the U.S. Department of Veterans Affairs, subject to indemnifications and insurance limits for certain loans.
15
Table of Contents
| As of March 31, 2025 | 90+ days and still accruing | 60-89 days past due | 30-59 days past due | ||||||||||||||||||||||||||||||||
| (In thousands) | Nonaccrual | Current | Total Loans | ||||||||||||||||||||||||||||||||
| Loan Balances (includes PCD): | |||||||||||||||||||||||||||||||||||
| Commercial | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Commercial real estate | |||||||||||||||||||||||||||||||||||
| Construction and development | |||||||||||||||||||||||||||||||||||
| Non-construction | |||||||||||||||||||||||||||||||||||
| Home equity | |||||||||||||||||||||||||||||||||||
| Residential real estate, excluding early buy-out loans | |||||||||||||||||||||||||||||||||||
| Premium finance receivables—property & casualty | |||||||||||||||||||||||||||||||||||
| Premium finance receivables—life insurance | |||||||||||||||||||||||||||||||||||
| Consumer and other | |||||||||||||||||||||||||||||||||||
| Total loans, net of unearned income, excluding early buy-out loans | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Early buy-out loans guaranteed by U.S. government agencies (1) | |||||||||||||||||||||||||||||||||||
| Total loans, net of unearned income | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Credit Quality Indicators
Credit quality indicators, specifically the Company's internal risk rating systems, reflect how the Company monitors credit losses and represents factors used by the Company when measuring the allowance for credit losses. Descriptions of the Company’s credit quality indicators by financial asset are included in Note (5) “Allowance for Credit Losses” of the 2025 Form 10-K.
The table below shows the Company’s loan portfolio by credit quality indicator and year of origination at March 31, 2026:
| Year of Origination | Revolving | Total | |||||||||||||||||||||||||||||||||
| (In thousands) | 2026 | 2025 | 2024 | 2023 | 2022 | Prior | Revolving | to Term | Loans | ||||||||||||||||||||||||||
| Loan Balances: | |||||||||||||||||||||||||||||||||||
| Commercial | |||||||||||||||||||||||||||||||||||
| Pass | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
| Special mention | |||||||||||||||||||||||||||||||||||
| Substandard accrual | |||||||||||||||||||||||||||||||||||
| Substandard nonaccrual/doubtful | |||||||||||||||||||||||||||||||||||
| Total commercial, industrial and other | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
| Construction and development | |||||||||||||||||||||||||||||||||||
| Pass | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
| Special mention | |||||||||||||||||||||||||||||||||||
| Substandard accrual | |||||||||||||||||||||||||||||||||||
| Substandard nonaccrual/doubtful | |||||||||||||||||||||||||||||||||||
| Total construction and development | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
| Non-construction | |||||||||||||||||||||||||||||||||||
| Pass | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
| Special mention | |||||||||||||||||||||||||||||||||||
| Substandard accrual | |||||||||||||||||||||||||||||||||||
| Substandard nonaccrual/doubtful | |||||||||||||||||||||||||||||||||||
| Total non-construction | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
| Home equity | |||||||||||||||||||||||||||||||||||
| Pass | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
| Special mention | |||||||||||||||||||||||||||||||||||
| Substandard accrual | |||||||||||||||||||||||||||||||||||
| Substandard nonaccrual/doubtful | |||||||||||||||||||||||||||||||||||
| Total home equity | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
| Residential real estate | |||||||||||||||||||||||||||||||||||
| Early buy-out loans guaranteed by U.S. government agencies | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
| Pass | |||||||||||||||||||||||||||||||||||
| Special mention | |||||||||||||||||||||||||||||||||||
16
Table of Contents
| Substandard accrual | |||||||||||||||||||||||||||||||||||
| Substandard nonaccrual/doubtful | |||||||||||||||||||||||||||||||||||
| Total residential real estate | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
| Premium finance receivables - property and casualty | |||||||||||||||||||||||||||||||||||
| Pass | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
| Special mention | |||||||||||||||||||||||||||||||||||
| Substandard accrual | |||||||||||||||||||||||||||||||||||
| Substandard nonaccrual/doubtful | |||||||||||||||||||||||||||||||||||
| Total premium finance receivables - property and casualty | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
Premium finance receivables - life (1) | |||||||||||||||||||||||||||||||||||
| Pass | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
| Special mention | |||||||||||||||||||||||||||||||||||
| Substandard accrual | |||||||||||||||||||||||||||||||||||
| Substandard nonaccrual/doubtful | |||||||||||||||||||||||||||||||||||
| Total premium finance receivables - life | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
| Consumer and other | |||||||||||||||||||||||||||||||||||
| Pass | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
| Special mention | |||||||||||||||||||||||||||||||||||
| Substandard accrual | |||||||||||||||||||||||||||||||||||
| Substandard nonaccrual/doubtful | |||||||||||||||||||||||||||||||||||
| Total consumer and other | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
| Total loans | |||||||||||||||||||||||||||||||||||
| Early buy-out loans guaranteed by U.S. government agencies | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
| Pass | |||||||||||||||||||||||||||||||||||
| Special mention | |||||||||||||||||||||||||||||||||||
| Substandard accrual | |||||||||||||||||||||||||||||||||||
| Substandard nonaccrual/doubtful | |||||||||||||||||||||||||||||||||||
| Total loans | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
| Gross write offs | |||||||||||||||||||||||||||||||||||
| Three months ended March 31, 2026 | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||
(1)For premium finance receivables - life, the year of origination represents when the borrower’s master loan agreement was initially established.
Held-to-maturity debt securities
The Company conducts an assessment of its investment securities, including those classified as held-to-maturity, at the time of purchase and on at least an annual basis to ensure such investment securities remain within appropriate levels of risk and continue to perform satisfactorily in fulfilling its obligations. The Company considers, among other factors, the nature of the securities and credit ratings or financial condition of the issuer. If available, the Company obtains a credit rating for issuers from a Nationally Recognized Statistical Rating Organization (“NRSRO”) for consideration. If no such rating is available for an issuer, the Company performs an internal rating based on the scale utilized within the loan portfolio. For purposes of the table below, the Company has converted any issuer rating from an NRSRO into the Company’s internal ratings based on Investment Policy and review by the Company’s management.
17
Table of Contents
| As of March 31, 2026 | Year of Origination | Total | ||||||||||||||||||||||||
| (In thousands) | 2026 | 2025 | 2024 | 2023 | 2022 | Prior | Balance | |||||||||||||||||||
| Amortized Cost Balances: | ||||||||||||||||||||||||||
| U.S. government agencies | ||||||||||||||||||||||||||
| 1-4 internal grade | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||
| 5-7 internal grade | ||||||||||||||||||||||||||
| 8-10 internal grade | ||||||||||||||||||||||||||
| Total U.S. government agencies | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||
| Municipal | ||||||||||||||||||||||||||
| 1-4 internal grade | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||
| 5-7 internal grade | ||||||||||||||||||||||||||
| 8-10 internal grade | ||||||||||||||||||||||||||
| Total municipal | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||
| Mortgage-backed securities | ||||||||||||||||||||||||||
| 1-4 internal grade | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||
| 5-7 internal grade | ||||||||||||||||||||||||||
| 8-10 internal grade | ||||||||||||||||||||||||||
| Total mortgage-backed securities | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||
| Corporate notes | ||||||||||||||||||||||||||
| 1-4 internal grade | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||
| 5-7 internal grade | ||||||||||||||||||||||||||
| 8-10 internal grade | ||||||||||||||||||||||||||
| Total corporate notes | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||
| Total held-to-maturity securities | $ | |||||||||||||||||||||||||
| Less: Allowance for credit losses | ( | |||||||||||||||||||||||||
| Held-to-maturity securities, net of allowance for credit losses | $ | |||||||||||||||||||||||||
Measurement of Allowance for Credit Losses
The Company's allowance for credit losses consists of the allowance for loan losses, the allowance for unfunded commitment losses and the allowance for held-to-maturity debt security losses. In accordance with ASC 326, the Company measures the allowance for credit losses at the time of origination or purchase of a financial asset, representing an estimate of lifetime expected credit losses on the related asset. When developing its estimate, the Company considers available information relevant to assessing the collectability of cash flows, from both internal and external sources. Historical credit loss experience is one input in the estimation process as well as inputs relevant to current conditions and reasonable and supportable forecasts. In considering past events, the Company considers the relevance, or lack thereof, of historical information due to changes in such things as financial asset underwriting or collection practices, and changes in portfolio mix due to changing business plans and strategies. In considering current conditions and forecasts, the Company considers both the current economic environment and the forecasted direction of the economic environment with emphasis on those factors deemed relevant to or driving changes in expected credit losses. As significant judgment is required, the review of the appropriateness of the allowance for credit losses is performed quarterly by various committees with participation by the Company's executive management.
| March 31, | December 31, | March 31, | ||||||||||||||||||||||||||||||
| (In thousands) | 2026 | 2025 | 2025 | |||||||||||||||||||||||||||||
| Allowance for loan losses | $ | $ | $ | |||||||||||||||||||||||||||||
| Allowance for unfunded lending-related commitments losses | ||||||||||||||||||||||||||||||||
| Allowance for loan losses and unfunded lending-related commitments losses | ||||||||||||||||||||||||||||||||
| Allowance for held-to-maturity securities losses | ||||||||||||||||||||||||||||||||
| Allowance for credit losses | $ | $ | $ | |||||||||||||||||||||||||||||
The allowance for credit losses is measured on a collective or pooled basis when similar risk characteristics exist, based upon the segmentation discussed above. The Company utilizes modeling methodologies that estimate lifetime credit loss rates on each pool. These methodologies include estimating the probability of default and loss given default on the commercial and commercial real estate segments, using the weighted-average remaining maturity methodology for the residential real estate, home equity, and consumer segments, and utilizing an assumption-based approach focusing on historical loss rates for the premium finance receivables segments. Historical credit loss history is adjusted for reasonable and supportable forecasts developed by the Company on a quantitative or qualitative basis and incorporates third party economic forecasts. Reasonable
18
Table of Contents
and supportable forecasts consider the macroeconomic factors that are most relevant to evaluating and predicting expected credit losses in the Company's financial assets. Currently, the Company utilizes an eight quarter forecast period using a single macroeconomic scenario provided by a third party and reviewed for potential adjustments within the Company's governance structure. For periods beyond the ability to develop reasonable and supportable forecasts, the Company reverts to historical loss rates at an input level, straight-line over a four quarter reversion period. Expected credit losses are measured over the contractual term of the financial asset with consideration of expected prepayments. Expected extensions, renewals or modifications of the financial asset are considered when the expected extension, renewal or modification is contained within the existing agreement and is not unconditionally cancelable. The methodologies discussed above are applied to both current asset balances on the Company's Consolidated Statements of Condition and off-balance sheet commitments (i.e. unfunded lending-related commitments).
Assets that do not share similar risk characteristics with a pool are assessed for the allowance for credit losses on an individual basis. These typically include assets experiencing financial difficulties, including assets rated as substandard nonaccrual and doubtful. If foreclosure is probable or the asset is considered collateral-dependent, expected credit losses are measured based upon the fair value of the underlying collateral adjusted for selling costs, if appropriate. Underlying collateral across the Company's segments consist primarily of real estate, land and construction assets as well as general business assets of the borrower. As of March 31, 2026, excluding loans carried at fair value, substandard nonaccrual loans totaling $64.7 million in carrying balance had no related allowance for credit losses.
The Company does not measure an allowance for credit losses on accrued interest receivable balances because these balances are written off in a timely manner as a reduction to interest income when assets are placed on nonaccrual status.
Loan portfolios
A summary of activity in the allowance for credit losses, specifically for the loan portfolio (i.e. allowance for loan losses and allowance for unfunded commitment losses), for the three months ended March 31, 2026 and March 31, 2025 is as follows:
| Three months ended March 31, 2026 | Commercial Real Estate | Home Equity | Residential Real Estate | Premium Finance Receivables | Consumer and Other | Total Loans | |||||||||||||||||||||||||||||||||||
| (In thousands) | Commercial | ||||||||||||||||||||||||||||||||||||||||
| Allowance for credit losses at beginning of period | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| Other adjustments | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Charge-offs | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
| Recoveries | |||||||||||||||||||||||||||||||||||||||||
| Provision for credit losses | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Allowance for credit losses at period end | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| By measurement method: | |||||||||||||||||||||||||||||||||||||||||
| Individually measured | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| Collectively measured | |||||||||||||||||||||||||||||||||||||||||
| Loans at period end | |||||||||||||||||||||||||||||||||||||||||
| Individually measured | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| Collectively measured | |||||||||||||||||||||||||||||||||||||||||
| Loans held at fair value | |||||||||||||||||||||||||||||||||||||||||
19
Table of Contents
| Three months ended March 31, 2025 | Commercial | Commercial Real Estate | Home Equity | Residential Real Estate | Premium Finance Receivables | Consumer and Other | Total Loans | ||||||||||||||||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||||||||||||||||||||
| Allowance for credit losses at beginning of period | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| Other adjustments | |||||||||||||||||||||||||||||||||||||||||
| Charge-offs | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||
| Recoveries | |||||||||||||||||||||||||||||||||||||||||
| Provision for credit losses | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Allowance for credit losses at period end | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| By measurement method: | |||||||||||||||||||||||||||||||||||||||||
| Individually measured | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| Collectively measured | |||||||||||||||||||||||||||||||||||||||||
| Loans at period end | |||||||||||||||||||||||||||||||||||||||||
| Individually measured | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| Collectively measured | |||||||||||||||||||||||||||||||||||||||||
| Loans held at fair value | |||||||||||||||||||||||||||||||||||||||||
For the three months ended March 31, 2026 and March 31, 2025, the Company recognized approximately $29.6 million and $24.0 million of provision for credit losses, respectively, related to loans and lending agreements. The provision for each period was primarily the result of losses experienced in the Commercial and Premium Finance Receivables portfolios along with growth across various segments, which was offset by improved macroeconomic forecasts related to CRE Price Index. Net charge-offs in the three month periods ended March 31, 2026 and March 31, 2025, totaled $18.4 million and $12.6 million, respectively.
Held-to-maturity debt securities
The allowance for credit losses on the Company’s held-to-maturity debt securities is presented as a reduction to the amortized cost basis of held-to-maturity securities on the Company's Consolidated Statements of Condition. For the three month periods ended March 31, 2026 and March 31, 2025, the Company recognized approximately $(3,000 ) and $(11,000 ), respectively, of provision for credit losses related to held-to-maturity securities. At March 31, 2026 and March 31, 2025, the Company did not identify any held-to-maturity debt securities within its portfolio that would require a charge-off.
Loan Modifications to Borrowers Experiencing Financial Difficulties
The Company’s approach to restructuring or modifying loans is built on its credit risk rating system, which requires credit management personnel to assign a credit risk rating to each loan. In each case, the loan officer is responsible for recommending a credit risk rating for each loan and ensuring the credit risk ratings are appropriate. These credit risk ratings are then reviewed and approved by the bank’s chief credit officer and/or concurrence credit officer. Credit risk ratings are determined by evaluating a number of factors, including a borrower’s financial strength, cash flow coverage, collateral protection and guarantees. The Company’s credit risk rating scale is one through ten with higher scores indicating higher risk. In the case of loans rated six or worse following modification, the Company’s Managed Assets Division evaluates the loan and the credit risk rating and determines that the loan has been restructured to be reasonably assured of repayment and of performance according to the modified terms and is supported by a current, well-documented credit assessment of the borrower’s financial condition and prospects for repayment under the revised terms. Based on the Company’s credit risk rating system, it considers that borrowers whose credit risk rating is 5 or better are not experiencing financial difficulties.
Restructurings may arise when, due to financial difficulties experienced by the borrower, the Company obtains through physical possession one or more collateral assets in satisfaction of all or part of an existing credit. Once possession is obtained, the Company reclassifies the appropriate portion of the remaining balance of the credit from loans to other real estate owned (“OREO”), which is included within other assets in the Consolidated Statements of Condition. For any residential real estate property collateralizing a consumer mortgage loan, the Company is considered to possess the related collateral only if legal title is obtained upon completion of foreclosure, or the borrower conveys all interest in the residential real estate property to the Company through completion of a deed in lieu of foreclosure or similar legal agreement. At March 31, 2026, the Company had no foreclosed residential real estate properties included within OREO. Further, the recorded investment in residential mortgage loans secured by residential real estate properties for which foreclosure proceedings are in process totaled $65.3 million and $65.1 million at March 31, 2026 and 2025, respectively.
20
Table of Contents
The tables below present a summary of the period-end balance of loans to borrowers experiencing financial difficulties during the three and three months ended March 31, 2026 and 2025:
Three Months Ended March 31, 2026 (Dollars in thousands) | Total | Percentage of Total Class of Loan | Extension of Term | Reduction of Interest Rate | Interest Only Payments | Delay in Contractual Payments | Extension of Term and Reduction of Interest Rate | |||||||||||||||||||||||||||||||||||||
| Commercial | $ | % | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
| Commercial real estate | ||||||||||||||||||||||||||||||||||||||||||||
| Construction and development | ||||||||||||||||||||||||||||||||||||||||||||
| Non-construction | ||||||||||||||||||||||||||||||||||||||||||||
| Premium finance receivables—property & casualty | ||||||||||||||||||||||||||||||||||||||||||||
| Total loans | $ | % | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
| Weighted Average Magnitude of Modifications: | ||||||||||||||||||||||||||
Three Months Ended March 31, 2026 (Dollars in thousands) | Total | Duration of Extension of Term (months) | Reduction of Interest Rate (bps) | Duration of Delay in Contractual Payments (months) | ||||||||||||||||||||||
| Commercial | $ | |||||||||||||||||||||||||
| Commercial real estate | ||||||||||||||||||||||||||
| Construction and development | — | |||||||||||||||||||||||||
| Non-construction | — | |||||||||||||||||||||||||
| Premium finance receivables—property & casualty | — | |||||||||||||||||||||||||
| Total loans | $ | |||||||||||||||||||||||||
Three Months Ended March 31, 2025 (Dollars in thousands) | Total | Percentage of Total Class of Loan | Extension of Term | Reduction of Interest Rate | Interest Only Payments | Delay in Contractual Payments | Extension of Term and Reduction of Interest Rate | |||||||||||||||||||||||||||||||||||||
| Commercial | $ | % | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
| Residential real estate | ||||||||||||||||||||||||||||||||||||||||||||
| Total loans | $ | % | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
| Weighted Average Magnitude of Modifications: | ||||||||||||||||||||||||||
Three Months Ended March 31, 2025 (Dollars in thousands) | Total | Duration of Extension of Term (months) | Reduction of Interest Rate (bps) | Duration of Delay in Contractual Payments (months) | ||||||||||||||||||||||
| Commercial | $ | — | ||||||||||||||||||||||||
| Residential real estate | — | |||||||||||||||||||||||||
| Total loans | $ | — | ||||||||||||||||||||||||
The Company had commitments of $31.2 million and $15.6 million as of March 31, 2026 and March 31, 2025, respectively, to lend additional funds to borrowers experiencing financial difficulty and for whom the Company has modified the terms of loans in the form of principal forgiveness, an interest rate reduction, an other-than insignificant payment delay or a term extension during the periods presented.
21
Table of Contents
The following table presents a summary of all modified loans for borrowers experiencing financial difficulties and such loans that were in payment default under the restructured terms during the respective periods below:
| (Dollars in thousands) | For the Twelve Months Ended March 31, 2026 | Three Months Ended March 31, 2026 | For the Twelve Months Ended March 31, 2025 | Three Months Ended March 31, 2025 | ||||||||||||||||||||||||||||||||||||||||||||||
| Total | Payments in Default (1) | Total | Payments in Default (1) | |||||||||||||||||||||||||||||||||||||||||||||||
| Commercial | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||
| Commercial real estate | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Construction and development | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Non-construction | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Home equity | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Residential real estate | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Premium finance receivables—property & casualty | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Total loans | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||
(1)Modified loans considered to be in payment default are over 30 days past due subsequent to the restructuring.
(8) Goodwill and Other Acquisition-Related Intangible Assets
A summary of the Company’s goodwill assets by reporting unit is presented in the following table:
| (In thousands) | December 31, 2025 | Goodwill Acquired | Impairment Loss | Foreign Currency Adjustments | March 31, 2026 | ||||||||||||||||||||||||
| Community banking | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Specialty finance | ( | ||||||||||||||||||||||||||||
| Wealth management | |||||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||
The Company assesses each reporting unit’s goodwill for impairment on at least an annual basis and considers potential indicators of impairment at each reporting date between annual goodwill impairment tests. At October 1, 2025, the Company utilized a qualitative approach for its annual goodwill impairment tests of the community banking, specialty finance and wealth management reporting units and determined that no impairment existed at that time.
At each reporting date between annual goodwill impairment tests, the Company considers potential indicators of impairment. The Company assessed whether events and circumstances resulted in it being more likely than not that the fair value of any reporting unit was less than its carrying value. Potential impairment indicators considered include the condition of the economy and banking industry; government intervention and regulatory updates; the impact of recent events to financial performance and cost factors of the reporting units; performance of the Company’s stock and other relevant events.
At the conclusion of this assessment of all reporting units, the Company determined that as of March 31, 2026, it was more likely than not that the fair value of all reporting units exceeded the respective carrying value of such reporting unit.
22
Table of Contents
A summary of acquisition-related intangible assets as of the dates shown and the expected amortization of finite-lived acquisition-related intangible assets as of March 31, 2026 is as follows:
| (In thousands) | March 31, 2026 | December 31, 2025 | March 31, 2025 | ||||||||||||||
| Community banking segment: | |||||||||||||||||
| Core deposit intangibles with finite lives: | |||||||||||||||||
| Gross carrying amount | $ | $ | $ | ||||||||||||||
| Accumulated amortization | ( | ( | ( | ||||||||||||||
| Net carrying amount | $ | $ | $ | ||||||||||||||
| Trademark with indefinite lives: | |||||||||||||||||
| Carrying amount | |||||||||||||||||
| Total net carrying amount | $ | $ | $ | ||||||||||||||
| Specialty finance segment: | |||||||||||||||||
| Customer list intangibles with finite lives: | |||||||||||||||||
| Gross carrying amount | $ | $ | $ | ||||||||||||||
| Accumulated amortization | ( | ( | ( | ||||||||||||||
| Net carrying amount | $ | $ | $ | ||||||||||||||
| Wealth management segment: | |||||||||||||||||
| Customer list and other intangibles with finite lives: | |||||||||||||||||
| Gross carrying amount | $ | $ | $ | ||||||||||||||
| Accumulated amortization | ( | ( | ( | ||||||||||||||
| Net carrying amount | $ | $ | $ | ||||||||||||||
| Total acquisition-related intangible assets: | |||||||||||||||||
| Gross carrying amount | $ | $ | $ | ||||||||||||||
| Accumulated amortization | ( | ( | ( | ||||||||||||||
| Total other acquisition-related intangible assets, net | $ | $ | $ | ||||||||||||||
| Estimated amortization | |||||
| Actual in three months ended March 31, 2026 | $ | ||||
Estimated remaining in 2026 | |||||
Estimated—2027 | |||||
Estimated—2028 | |||||
Estimated—2029 | |||||
Estimated—2030 | |||||
The core deposit intangibles recognized in connection with the Company’s bank acquisitions are amortized over a ten-year period on an accelerated basis. The customer list intangibles recognized in connection with the purchase of life insurance premium finance assets in 2009 are being amortized over an 18-year period on an accelerated basis. The customer list and other intangibles recognized in connection with prior acquisitions within the wealth management segment are being amortized over a period of up to ten years on a straight-line or accelerated basis. Indefinite-lived intangible assets consist of certain trade and domain names recognized in connection with prior acquisitions. As indefinite-lived intangible assets are not amortized, the Company assesses impairment on at least an annual basis. Total amortization expense associated with finite-lived acquisition-related intangibles totaled approximately $5.0 million and $5.6 million for the three months ended March 31, 2026 and 2025, respectively.
23
Table of Contents
(9) Mortgage Servicing Rights (“MSRs”)
The following is a summary of the changes in the carrying value of MSRs, accounted for at fair value, for the periods indicated:
| Three Months Ended | ||||||||||||||||||||||||||
| March 31, | March 31, | |||||||||||||||||||||||||
| (In thousands) | 2026 | 2025 | ||||||||||||||||||||||||
| Fair value at beginning of the period | $ | $ | ||||||||||||||||||||||||
| Additions from loans sold with servicing retained | ||||||||||||||||||||||||||
| Estimate of changes in fair value due to: | ||||||||||||||||||||||||||
| Payoffs, paydowns and repurchases | ( | ( | ||||||||||||||||||||||||
| Changes in valuation inputs or assumptions | ( | |||||||||||||||||||||||||
| Fair value at end of the period | $ | $ | ||||||||||||||||||||||||
| Unpaid principal balance of mortgage loans serviced for others | $ | $ | ||||||||||||||||||||||||
The Company recognizes MSR assets upon the sale of residential real estate loans to external third parties when it retains the obligation to service the loans and the servicing fee is more than adequate compensation. MSRs are included in other assets in the Consolidated Statements of Condition. The initial recognition of MSR assets from loans sold with servicing retained and subsequent changes in fair value of all MSRs are recognized in mortgage banking revenue. MSRs are subject to changes in value from actual and expected prepayment of the underlying loans.
The estimation of fair value related to MSRs is partly impacted by the Company exercising its early buyout options (“EBO”) on eligible loans previously sold to the Government National Mortgage Association (“GNMA”). Under such optional repurchase program, financial institutions acting as servicers are allowed to buy back from the securitized loan pool individual delinquent mortgage loans meeting certain criteria for which the institution was the original transferor of such loans. At the option of the servicer and without prior authorization from GNMA, the servicer may repurchase such delinquent loans for an amount equal to the remaining principal balance of the loan. At the time of such repurchase, any MSR value related to such loans is derecognized.
The MSR asset fair value is determined by using a discounted cash flow model that incorporates the objective characteristics of the portfolio as well as subjective valuation parameters that purchasers of servicing would apply to such portfolios sold into the secondary market. The subjective factors include loan prepayment speeds, discount rates, servicing costs and other economic factors. The Company uses a third party to assist in the valuation of MSRs.
Periodically, the Company will purchase options for the right to purchase securities not currently held within the banks’ investment portfolios or enter into interest rate swaps in which the Company elects not to designate such derivatives as hedging instruments. These option and swap transactions are designed primarily to economically hedge a portion of the fair value adjustments related to the Company’s MSRs. The gain or loss associated with these derivative contracts is included in mortgage banking revenue. For more information regarding these hedges outstanding as of March 31, 2026 and March 31, 2025, see Note (14) “Derivative Financial Instruments” in Item 1 of this report.
24
Table of Contents
(10) Deposits
The following table is a summary of deposits as of the dates shown:
| (Dollars in thousands) | March 31, 2026 | December 31, 2025 | March 31, 2025 | ||||||||||||||
| Balance: | |||||||||||||||||
| Non-interest-bearing | $ | $ | $ | ||||||||||||||
| NOW and interest-bearing demand deposits | |||||||||||||||||
| Wealth management deposits | |||||||||||||||||
| Money market | |||||||||||||||||
| Savings | |||||||||||||||||
| Time certificates of deposit | |||||||||||||||||
| Total deposits | $ | $ | $ | ||||||||||||||
| Mix: | |||||||||||||||||
| Non-interest-bearing | % | % | % | ||||||||||||||
| NOW and interest-bearing demand deposits | |||||||||||||||||
| Wealth management deposits | |||||||||||||||||
| Money market | |||||||||||||||||
| Savings | |||||||||||||||||
| Time certificates of deposit | |||||||||||||||||
| Total deposits | % | % | % | ||||||||||||||
Wealth management deposits represent deposit balances (primarily money market accounts) at the Company’s subsidiary banks from brokerage customers of Wintrust Investments, LLC (“Wintrust Investments”), Chicago Deferred Exchange Company (“CDEC”) and trust and asset management customers of the Company.
(11) FHLB Advances, Other Borrowings and Subordinated Notes
The following table is a summary of FHLB advances, other borrowings and subordinated notes as of the dates shown:
| (In thousands) | March 31, 2026 | December 31, 2025 | March 31, 2025 | ||||||||||||||
| FHLB advances | $ | $ | $ | ||||||||||||||
| Other borrowings: | |||||||||||||||||
| Notes payable | |||||||||||||||||
| Secured borrowings | |||||||||||||||||
| Other | |||||||||||||||||
| Total other borrowings | |||||||||||||||||
| Subordinated notes | |||||||||||||||||
| Total FHLB advances, other borrowings and subordinated notes | $ | $ | $ | ||||||||||||||
Descriptions of the Company’s FHLB advances, other borrowings, and subordinated notes are included in Note (11) “Federal Home Loan Bank Advances” Note (12) “Subordinated Notes” and Note (13) “Other Borrowings” of the 2025 Form 10-K.
Notes Payable
Notes payable balances represent the balances on the Company’s credit agreement with certain unaffiliated banks. The term loan facility was paid in full in December 2025. At March 31, 2026, there was no outstanding principal balance under the revolving credit facility. Borrowings under notes payable are secured by pledges of and first priority perfected security interests in the Company’s equity interest in its bank subsidiaries and contain several restrictive covenants, including the maintenance of various capital adequacy levels, asset quality and profitability ratios, and certain restrictions on dividends and other indebtedness. At March 31, 2026, the Company was in compliance with all such covenants.
25
Table of Contents
Secured Borrowings
The balance of secured borrowings primarily represents a third party Canadian transaction (“Canadian Secured Borrowing”). Under the Canadian Secured Borrowing, the Company, through its subsidiary, First Insurance Funding of Canada (“FIFC Canada”), sells an undivided co-ownership interest in all receivables owed to FIFC Canada to an unrelated third party in exchange for cash payments pursuant to a receivables purchase agreement (“Receivables Purchase Agreement”). On December 15, 2025, the Company entered into the Thirteenth Amending Agreement to the Receivables Purchase Agreement dated as of December 16, 2014. The amended Receivables Purchase Agreement provides for, among other things, an extension of the maturity date to December 15, 2026 and a decrease to the facility limit from C$650 million to C$580 million.
At March 31, 2026, the translated balance of the secured borrowings totaled $327.0 million compared to $408.0 million at December 31, 2025 and $319.6 million at March 31, 2025. The interest rate under the Receivables Purchase Agreement is the Canadian Commercial Paper Rate plus fee rate of 0.775 %.
The remaining $13.7 million, $14.1 million and $17.5 million within secured borrowings at March 31, 2026, December 31, 2025 and March 31, 2025, respectively, represent other sold interests in certain loans by the Company that were not considered sales and, as such, related proceeds received are reflected on the Company’s Consolidated Statements of Condition as a secured borrowing owed to the various unrelated third parties.
Other Borrowings
Other borrowings represented a promissory note (“Promissory Note”) issued by the Company in June 2017. The Promissory Note was paid in full in March 2026.
Subordinated Notes
At March 31, 2026, the Company had outstanding subordinated notes totaling $298.7 million compared to $298.6 million and $298.4 million at December 31, 2025 and March 31, 2025, respectively. The notes issued in 2019 have a stated interest rate of 4.85 % and mature in June 2029.
(12) Junior Subordinated Debentures
The junior subordinated debentures totaled $253.6 6.14 %. Descriptions of the Company’s Junior Subordinated Debentures are included in Note (14) “Junior Subordinated Debentures” in the 2025 Form 10-K.
(13) Segment Information
The Company’s operations consist of three primary segments: community banking, specialty finance and wealth management.
The three reportable segments are strategic business units that are separately managed as they offer different products and services and have different marketing strategies. In addition, each segment’s customer base has varying characteristics and each segment has a different regulatory environment. While the Company’s management monitors each of the sixteen bank subsidiaries’ operations and profitability separately, these subsidiaries have been aggregated into one reportable operating segment due to the similarities in products and services, customer base, operations, profitability measures, and economic characteristics.
For purposes of internal segment profitability, management allocates certain intersegment and parent company balances. Management allocates a portion of revenues to the specialty finance segment related to loans and leases originated by the specialty finance segment and sold or assigned to the community banking segment. Similarly, for purposes of analyzing the contribution from the wealth management segment, management allocates a portion of the net interest income earned by the community banking segment on deposit balances of customers of the wealth management segment to the wealth management segment. See Note (10) “Deposits” in Item 1 of this report for more information on these deposits. Finally, expenses incurred at the Wintrust parent company are allocated to each segment based on each segment’s risk-weighted assets.
The segment financial information provided in the following table has been derived from the internal profitability reporting system used by management to monitor and manage the financial performance of the Company. The accounting policies of the
26
Table of Contents
segments are substantially similar to those described in Note (1) “Summary of Significant Accounting Policies” in the 2025 Form 10-K.
Our Chief Executive Officer is our chief operating decision maker (“CODM”). The CODM uses income before taxes to review segment performance and allocate resources for each reportable segment. Financial information regarding each significant segment expense outlined below is regularly provided (at least monthly) to the CODM. For community banking and specialty finance segments, ‘Interest expense’ is a significant segment expense. Additionally, for each of the three reportable segments, ‘Salaries’, ‘Commissions and incentive compensation’ and ‘Benefits’ are significant segment expenses.
The following is a summary of certain operating information for reportable segments:
(In thousands) | Community Banking | Specialty Finance | Wealth Management | Total Operating Segments | Intersegment Eliminations | Consolidated | ||||||||||||||||||||||||||||||||
| Three Months Ended March 31, 2026: | ||||||||||||||||||||||||||||||||||||||
| Interest income | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Interest expense | ||||||||||||||||||||||||||||||||||||||
| Net interest income | ||||||||||||||||||||||||||||||||||||||
| Provision for credit losses | ||||||||||||||||||||||||||||||||||||||
| Non-interest income | ( | |||||||||||||||||||||||||||||||||||||
| Non-interest expense: | ||||||||||||||||||||||||||||||||||||||
| Salaries | ||||||||||||||||||||||||||||||||||||||
| Commissions and incentive compensation | ||||||||||||||||||||||||||||||||||||||
| Benefits | ||||||||||||||||||||||||||||||||||||||
Other segment expenses (1) | ( | |||||||||||||||||||||||||||||||||||||
| Total non-interest expense | ( | |||||||||||||||||||||||||||||||||||||
| Income before taxes | ||||||||||||||||||||||||||||||||||||||
| Income tax expense | ||||||||||||||||||||||||||||||||||||||
| Net income | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Total assets at period end | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Three Months Ended March 31, 2025: | ||||||||||||||||||||||||||||||||||||||
| Interest income | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Interest expense | ||||||||||||||||||||||||||||||||||||||
| Net interest income | ||||||||||||||||||||||||||||||||||||||
| Provision for credit losses | ||||||||||||||||||||||||||||||||||||||
| Non-interest income | ( | |||||||||||||||||||||||||||||||||||||
| Non-interest expense: | ||||||||||||||||||||||||||||||||||||||
| Salaries | ||||||||||||||||||||||||||||||||||||||
| Commissions and incentive compensation | ||||||||||||||||||||||||||||||||||||||
| Benefits | ||||||||||||||||||||||||||||||||||||||
Other segment expenses (1) | ( | |||||||||||||||||||||||||||||||||||||
| Total non-interest expense | ( | |||||||||||||||||||||||||||||||||||||
| Income before taxes | ||||||||||||||||||||||||||||||||||||||
| Income tax expense | ||||||||||||||||||||||||||||||||||||||
| Net income | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Total assets at period end | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
(1)Other segment items include non-interest expense categories such as ‘Software & Equipment’, ‘Data processing’, ‘Advertising and Marketing’, ‘FDIC Insurance’, and ‘Occupancy’. See “Non-Interest Expense” under Management’s Discussion and Analysis of Financial Condition and Results of Operations in Item 2 of this Form 10-Q for further discussion on non-interest expense.
(14) Derivative Financial Instruments
The Company primarily enters into derivative financial instruments as part of its strategy to manage its exposure to changes in interest rates. Derivative instruments represent contracts between parties that result in one party delivering cash to the other party based on a notional amount and an underlying term (such as a rate, security price or price index or commodity price) as
27
Table of Contents
specified in the contract. The amount of cash delivered from one party to the other is determined based on the interaction of the notional amount of the contract with the underlying term. Derivatives are also implicit in certain contracts and commitments.
The derivative financial instruments currently used by the Company to manage its exposure to interest rate risk include: (1) interest rate swaps, collars and floors to manage the interest rate risk of certain fixed and variable rate assets and variable rate liabilities; (2) interest rate lock commitments provided to customers to fund certain mortgage loans to be sold into the secondary market; (3) forward commitments for the future delivery of such mortgage loans to protect the Company from adverse changes in interest rates and corresponding changes in the value of mortgage loans held-for-sale; (4) covered call options to economically hedge specific investment securities and receive fee income, effectively enhancing the overall yield on such securities to compensate for potential net interest margin compression; and (5) options and swaps to economically hedge a portion of the fair value adjustments related to the Company’s mortgage servicing rights portfolio. The Company also enters into derivatives (typically interest rate swaps and commodity forward contracts) with certain qualified borrowers to facilitate the borrowers’ risk management strategies and concurrently enters into mirror-image derivatives with a third party counterparty, effectively making a market in the derivatives for such borrowers. Additionally, the Company enters into foreign currency contracts to manage foreign exchange risk associated with certain foreign currency denominated assets.
The Company recognizes derivative financial instruments in the consolidated financial statements at fair value regardless of the purpose or intent for holding the instrument. The Company records derivative assets and derivative liabilities on the Consolidated Statements of Condition within accrued interest receivable and other assets and accrued interest payable and other liabilities, respectively. Changes in the fair value of derivative financial instruments are either recognized in income or in shareholders’ equity as a component of accumulated other comprehensive income or loss depending on whether the derivative financial instrument qualifies for hedge accounting and, if so, whether it qualifies as a fair value hedge or cash flow hedge.
Changes in fair values of derivatives accounted for as fair value hedges are recorded in income in the same period and in the same income statement line as changes in the fair values of the hedged items that relate to the hedged risk(s). Changes in fair values of derivative financial instruments accounted for as cash flow hedges are recorded as a component of accumulated other comprehensive income or loss, net of deferred taxes, and reclassified to earnings when the hedged transaction affects earnings. Changes in fair values of derivative financial instruments not designated in a hedging relationship pursuant to ASC 815 are reported in non-interest income during the period of the change. Derivative financial instruments are valued by a third party and are corroborated by comparison with valuations provided by the respective counterparties. Fair values of certain mortgage banking derivatives (interest rate lock commitments and forward commitments to sell mortgage loans) are estimated based on changes in mortgage interest rates from the date of the loan commitment. The fair value of foreign currency derivatives is computed based on changes in foreign currency rates stated in the contract compared to those prevailing at the measurement date. Commodity derivative fair values are computed based on changes in the price per unit stated in the contract compared to those prevailing at the measurement date.
The table below presents the fair value of the Company’s derivative financial instruments as of March 31, 2026, December 31, 2025 and March 31, 2025:
| Derivative Assets | Derivative Liabilities | ||||||||||||||||||||||||||||||||||
| (In thousands) | March 31, 2026 | December 31, 2025 | March 31, 2025 | March 31, 2026 | December 31, 2025 | March 31, 2025 | |||||||||||||||||||||||||||||
| Derivatives designated as hedging instruments under ASC 815: | |||||||||||||||||||||||||||||||||||
| Interest rate derivatives designated as Cash Flow Hedges | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Interest rate derivatives designated as Fair Value Hedges | |||||||||||||||||||||||||||||||||||
| Total derivatives designated as hedging instruments under ASC 815 | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Derivatives not designated as hedging instruments under ASC 815: | |||||||||||||||||||||||||||||||||||
| Interest rate derivatives | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Interest rate lock commitments | |||||||||||||||||||||||||||||||||||
| Forward commitments to sell mortgage loans | |||||||||||||||||||||||||||||||||||
| Commodity forward contracts | |||||||||||||||||||||||||||||||||||
| Foreign exchange contracts | |||||||||||||||||||||||||||||||||||
| Total derivatives not designated as hedging instruments under ASC 815 | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Total Derivatives | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
28
Table of Contents
Cash Flow Hedges of Interest Rate Risk
The Company’s objectives in using interest rate derivatives are to add stability to net interest income and to manage its exposure to interest rate movements. To accomplish these objectives, the Company uses interest rate swaps, collars and floors as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts to or from a counterparty in exchange for the Company receiving or paying fixed-rate payments over the life of the agreements without the exchange of the underlying notional amount. Interest rate collars designated as cash flow hedges involve the settlement of amounts in which the interest rate specified in the contract exceeds the agreed upon cap strike rate or in which the interest rate specified in the contract is below the agreed upon floor strike rate at the end of each period. Interest rate floors designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty if interest rates fall below the strike rate on the contract in exchange for an upfront premium.
As of March 31, 2026, the Company had various interest rate collar, swap and floor derivatives designated as cash flow hedges of variable rate loans. When the relationship between the hedged item and hedging instrument is highly effective at achieving offsetting changes in cash flows attributable to the hedged risk, changes in the fair value of these cash flow hedges are recorded in accumulated other comprehensive income or loss and are subsequently reclassified to interest income as interest payments are made on such variable rate loans. The changes in fair value (net of tax) are separately disclosed in the Consolidated Statements of Comprehensive Income.
The table below provides details on these cash flow hedges, summarized by derivative type and maturity, as of March 31, 2026:
| March 31, 2026 | ||||||||||||||||||||
| (In thousands) | Notional Amount | Fair Value Asset (Liability) | ||||||||||||||||||
| Floor at 1-month CME Term SOFR | September 2028 - December 2029 | $ | $ | |||||||||||||||||
| Interest rate collars at 1-month CME term SOFR | October 2026 - September 2027 | ( | ||||||||||||||||||
Interest rate swaps at 1-month CME term SOFR (1) | July 2026 - March 2032 | |||||||||||||||||||
| Total Cash Flow Hedges | $ | $ | ||||||||||||||||||
(1)The notional amount includes forward-starting swaps that are not yet effective.
In the first quarter of 2022, the Company terminated interest rate swap derivative contracts designated as cash flow hedges of variable rate deposits with a total notional value of $1.0 billion and a five-year term effective July 2022. At the time of termination, the fair value of the derivative contracts totaled an asset of $66.5 million, with such adjustments to fair value recorded in accumulated other comprehensive income or loss.
For all such terminations, as the hedged forecasted transactions (interest payments on variable rate deposits) are still expected to occur over the remaining term of such terminated derivatives, such adjustments will remain in accumulated other comprehensive income or loss and be reclassified as a reduction to interest expense on a straight-line basis over the original term of the terminated derivative contracts.
A rollforward of the amounts in accumulated other comprehensive income or loss related to interest rate derivatives designated as cash flow hedges, including such derivative contracts terminated during the period, follows:
| Three Months Ended | |||||||||||||||||||||||
| (In thousands) | March 31, 2026 | March 31, 2025 | |||||||||||||||||||||
| Unrealized gain (loss) at beginning of period | $ | $ | ( | ||||||||||||||||||||
| Amount reclassified from accumulated other comprehensive income or loss to interest income or expense on deposits, loans, and other borrowings | ( | ||||||||||||||||||||||
| Amount of (loss) gain recognized in other comprehensive income or loss | ( | ||||||||||||||||||||||
| Unrealized gain at end of period | $ | $ | |||||||||||||||||||||
As of March 31, 2026, the Company estimated that during the next 12 months $25.4 million will be reclassified from accumulated other comprehensive income or loss as an increase to net interest income. Such estimate consists of $13.3 million reclassified as a reduction to interest expense on the terminated cash flow hedges discussed above and $12.1 million reclassified as an increase to interest income related to the interest rate collars, floors and swaps noted above that remain outstanding.
29
Table of Contents
Fair Value Hedges of Interest Rate Risk
Interest rate swaps designated as fair value hedges involve the payment of fixed amounts to a counterparty in exchange for the Company receiving variable payments over the life of the agreements without the exchange of the underlying notional amount. As of March 31, 2026, the Company had 13 interest rate swaps with an aggregate notional amount of $116.9 million that were designated as fair value hedges primarily associated with fixed rate commercial and industrial and commercial real estate loans as well as life insurance premium finance receivables.
For derivatives designated and that qualify as fair value hedges, the net gain or loss from the entire change in the fair value of the derivative instrument is recognized in the same income statement line item as the earnings effect, including the net gain or loss, of the hedged item (interest income earned on fixed rate loans) when the hedged item affects earnings.
The following amounts were recorded on the balance sheet related to cumulative basis adjustments for fair value hedges as of March 31, 2026:
| (In thousands) | March 31, 2026 | |||||||||||||||||||||||||
Derivatives in Fair Value Hedging Relationships | Location in the Statement of Condition | Carrying Amount of the Hedged Assets/(Liabilities) | Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/(Liabilities) | Cumulative Amount of Fair Value Hedging Adjustment Remaining for any Hedged Assets/(Liabilities) for which Hedge Accounting has been Discontinued | ||||||||||||||||||||||
| Interest rate swaps | Loans, net of unearned income | $ | $ | ( | $ | ( | ||||||||||||||||||||
| Available-for-sale debt securities | ( | |||||||||||||||||||||||||
The following table presents the loss or gain recognized related to derivative instruments that are designated as fair value hedges for the respective period:
(In thousands) Derivatives in Fair Value Hedging Relationships | Location of (Loss)/Gain Recognized in Income on Derivative | Three Months Ended | |||||||||||||||
| March 31, 2026 | |||||||||||||||||
| Interest rate swaps | Interest and fees on loans | $ | |||||||||||||||
Non-Designated Hedges
The Company does not use derivatives for speculative purposes. Derivatives not designated as accounting hedges are used to manage the Company’s economic exposure to interest rate movements and other identified risks but do not meet the strict hedge accounting requirements of ASC 815. Changes in the fair value of derivatives not designated in hedging relationships are recorded directly in earnings.
Interest Rate Derivatives—The Company has interest rate derivatives, including swaps and option products, resulting from a service the Company provides to certain qualified borrowers. The Company’s banking subsidiaries execute certain derivative products (typically interest rate swaps) directly with qualified commercial borrowers to facilitate their respective risk management strategies. For example, these arrangements allow the Company’s commercial borrowers to effectively convert a variable rate loan to a fixed rate. In order to minimize the Company’s exposure on these transactions, the Company simultaneously executes offsetting derivatives with third parties. In most cases, the offsetting derivatives have mirror-image terms, which result in the positions’ changes in fair value substantially offsetting through earnings each period. However, to the extent that the derivatives are not a mirror-image and because of differences in counterparty credit risk, changes in fair value will not completely offset resulting in some earnings impact each period. Changes in the fair value of these derivatives are included in other non-interest income. At March 31, 2026 and December 31, 2025, the Company had interest rate derivative transactions with an aggregate notional amount of approximately $15.5 billion and $15.2 billion, respectively, (all interest rate swaps and caps with customers and third parties) related to this program. At March 31, 2026 these interest rate derivatives had maturity dates ranging from April 2026 to August 2037.
Mortgage Banking Derivatives—These derivatives include interest rate lock commitments provided to customers to fund certain mortgage loans to be sold into the secondary market and forward commitments for the future delivery of such loans. It is the Company’s practice to enter into forward commitments for the future delivery of a portion of its residential mortgage loan production when interest rate lock commitments are entered into in order to economically hedge the effect of future changes in interest rates on its commitments to fund the loans as well as on its portfolio of mortgage loans held-for-sale. The Company’s
30
Table of Contents
mortgage banking derivatives have not been designated as being in hedge relationships. At March 31, 2026 and December 31, 2025, the Company had interest rate lock commitments with an aggregate notional amount of approximately $302.2 million and $161.9 million, and forward commitments to sell mortgage loans with an aggregate notional amount of approximately $481.5 million and $413.2 million, respectively. The fair values of these derivatives were estimated based on changes in mortgage rates from the dates of the commitments. Changes in the fair value of these mortgage banking derivatives are included in mortgage banking revenue.
Periodically, the Company will purchase mortgage and interest rate derivative contracts in which the Company elects to not designate such derivatives as hedging instruments. These contracts are designed primarily to economically hedge a portion of the fair value adjustments related to the Company’s mortgage servicing rights portfolio. The gain or loss associated with these derivative contracts is included in mortgage banking revenue. The Company held ten interest rate derivatives with an aggregate notional value of $327.0 million at March 31, 2026 and ten interest rate derivatives with an aggregate notional value of $362.0 million at December 31, 2025. At March 31, 2026, the Company had one to-be-announced forward-setting contract for mortgage-backed securities with an aggregate notional value of $56.0 million, for such purpose of economically hedging a portion of the fair value adjustment related to its mortgage servicing rights portfolio. At December 31, 2025, the Company had one such forward-setting contract with an aggregate notional value of $56.0 million.
Commodity Derivatives—The Company has commodity forward contracts resulting from a service the Company provides to certain qualified borrowers. The Company’s banking subsidiaries execute certain derivative products directly with qualified commercial borrowers to facilitate their respective risk management strategies. For example, these arrangements allow the Company’s commercial borrowers to effectively purchase or sell a given commodity at an agreed-upon price on an agreed-upon settlement date. In order to minimize the Company’s exposure on these transactions, the Company simultaneously executes offsetting derivatives with third parties. In most cases, the offsetting derivatives have mirror-image terms, which result in the positions’ changes in fair value substantially offsetting through earnings each period. However, to the extent that the derivatives are not a mirror-image and because of differences in counterparty credit risk, changes in fair value will not completely offset resulting in some earnings impact each period. Changes in the fair value of these derivatives are included in other non-interest income. At March 31, 2026 and December 31, 2025, the Company had commodity derivative transactions with an aggregate notional amount of approximately $6.3 million and $4.1 million, respectively, (all forward contracts with customers and third parties) related to this program. At March 31, 2026, these commodity derivatives had maturity dates ranging from April 2026 to October 2027.
Foreign Currency Derivatives—The Company has foreign currency derivative contracts resulting from a service the Company provides to certain qualified customers. The Company’s banking subsidiaries execute certain derivative products directly with qualified customers to facilitate their respective risk management strategies related to foreign currency fluctuations. For example, these arrangements allow the Company’s customers to effectively exchange the currency of one country for the currency of another country at an agreed-upon price on an agreed-upon settlement date. In order to minimize the Company’s exposure on these transactions, the Company simultaneously executes offsetting derivatives with third parties. In most cases, the offsetting derivatives have mirror-image terms, which result in the positions’ changes in fair value substantially offsetting through earnings each period. However, to the extent that the derivatives are not a mirror-image and because of differences in counterparty credit risk, changes in fair value will not completely offset resulting in some earnings impact each period. Changes in the fair value of these derivatives are included in other non-interest income. As of March 31, 2026 and December 31, 2025, the Company held foreign currency derivatives with an aggregate notional amount of approximately $63.0 million and $84.0 million, respectively.
Other Derivatives—Periodically, the Company will sell options to a bank or dealer for the right to purchase certain securities held within the banks’ investment portfolios (covered call options). These option transactions are designed to increase the total return associated with the investment securities portfolio. These options do not qualify as accounting hedges pursuant to ASC 815 and, accordingly, changes in the fair value of these contracts are recognized as other non-interest income. There were no
31
Table of Contents
Amounts included in the Consolidated Statements of Income related to derivative instruments not designated in hedge relationships were as follows:
| (In thousands) | Three Months Ended | ||||||||||||||||||||||||||||
| Derivative | Location in income statement | March 31, 2026 | March 31, 2025 | ||||||||||||||||||||||||||
| Interest rate swaps and caps | Trading gains (losses), net | $ | ( | $ | ( | ||||||||||||||||||||||||
| Mortgage banking derivatives | Mortgage banking | ||||||||||||||||||||||||||||
| Commodity contracts | Trading gains (losses), net | ( | |||||||||||||||||||||||||||
| Foreign exchange contracts | Trading gains (losses), net | ||||||||||||||||||||||||||||
| Covered call options | Fees from covered call options | ||||||||||||||||||||||||||||
| Derivative contract held as economic hedge on MSRs | Mortgage banking | ( | |||||||||||||||||||||||||||
Credit Risk
Derivative instruments have inherent risks, primarily market risk and credit risk. Market risk is associated with changes in the value of an underlying asset. Credit risk relates to the risk that the counterparty will fail to perform according to the terms of the agreement. The Company is exposed to the credit risk of its commercial borrowers and third party financial institutions who are counterparties to interest rate derivatives with the Company.
The counterparty credit risk associated with the mirror-image swaps executed with third party financial institutions is monitored and managed as part of the Company’s overall asset-liability management process, except that the counterparty credit risk related to derivatives entered into with certain qualified borrowers is managed through the Company’s standard loan underwriting process for commercial borrowers since these derivatives typically share in the collateral provided by the loan agreements.
When deemed necessary, appropriate types and amounts of collateral are obtained to minimize credit exposure. The Company hedges the market risk of derivatives transactions with commercial borrowers by entering into offsetting transactions with large, highly rated financial institutions. These exposures are generally secured by cash under bilateral Credit Support Annexes, which are a component of the International Swaps and Derivatives Association (“ISDA”) Master Agreements executed with counterparties.
Aggregate counterparty exposures are monitored against various types of credit limits established to contain risk within parameters. Counterparty credit risk is managed by the Counterparty Credit Risk Management team in accordance with Supervision & Regulatory 11-10, Interagency Counterparty Credit Risk Management Guidance, which was issued in 2011 in response to the financial crisis of 2008. The guidance addresses counterparty credit risk governance, measurement, management, and systems. Specifically, counterparty risk is managed through the establishment and regular review of exposure limits, formalization of limits in policy and procedure, ongoing review of models, and having a single platform to allow for the timely aggregation of exposures. The Counterparty Credit Risk Management team uses a variety of approaches to monitor counterparty financial performance, including monitoring of credit exposure versus limits, use of early warning reports, and daily and intraday monitoring of financial developments.
The Company has agreements with certain of its interest rate derivative counterparties that contain cross-default provisions, which provide that if the Company defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then the Company could also be declared in default on its derivative obligations. The Company also has agreements with certain of its derivative counterparties that contain a provision allowing the counterparty to terminate the derivative positions if the Company fails to maintain its status as a well or adequately capitalized institution, which would require the Company to settle its obligations under the agreements. If the Company were to breach any of these provisions, at a time when the derivatives subject to such agreements are in a liability position, and the derivatives were to be terminated as a result, the Company would be required to settle its obligations under the agreements at the termination value and would be required to pay any additional amounts due in excess of amounts previously posted as collateral with the respective counterparty. As of March 31, 2026, there were $1.9 million of derivatives that were subject to such agreements in a net liability position.
32
Table of Contents
The Company records interest rate derivatives subject to master netting agreements at their gross value and does not offset derivative assets and liabilities on the Consolidated Statements of Condition. The table below summarizes the Company’s interest rate derivatives and offsetting positions as of the dates shown.
| Derivative Assets | Derivative Liabilities | ||||||||||||||||||||||||||||||||||
| Fair Value | Fair Value | ||||||||||||||||||||||||||||||||||
| (In thousands) | March 31, 2026 | December 31, 2025 | March 31, 2025 | March 31, 2026 | December 31, 2025 | March 31, 2025 | |||||||||||||||||||||||||||||
| Gross Amounts Recognized | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Gross amounts not offset in the Statements of Condition | |||||||||||||||||||||||||||||||||||
| Offsetting Derivative Positions | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||
| Collateral Posted | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||
| Net Credit Exposure | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
(15) Fair Value of Assets and Liabilities
The Company measures, monitors and discloses certain of its assets and liabilities on a fair value basis. These financial assets and financial liabilities are measured at fair value in three levels, based on the markets in which the assets and liabilities are traded and the observability of the inputs used to determine fair value. These levels are:
•Level 1—unadjusted quoted prices in active markets for identical assets or liabilities.
•Level 2—inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability or inputs that are derived principally from or corroborated by observable market data by correlation or other means.
•Level 3—significant unobservable inputs that reflect the Company’s own assumptions that market participants would use in pricing the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation.
A financial instrument’s categorization within the above valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the assets or liabilities. The following is a description of the valuation methodologies used for the Company’s assets and liabilities measured at fair value on a recurring basis.
Available-for-sale debt securities, trading account securities and equity securities with readily determinable fair value—Fair values for available-for-sale debt securities, trading account securities and equity securities with readily determinable fair value are typically based on prices obtained from independent pricing vendors. Securities measured with these valuation techniques are generally classified as Level 2 of the fair value hierarchy. Typically, standard inputs such as benchmark yields, reported trades for similar securities, issuer spreads, benchmark securities, bids, offers and reference data including market research publications are used to determine the fair value of these securities. When these inputs are not available, broker/dealer quotes may be obtained by the vendor to determine the fair value of the security. We review the vendor’s pricing methodologies to determine if observable market information is being used, versus unobservable inputs. Fair value measurements using significant inputs that are unobservable in the market due to limited activity or a less liquid market are classified as Level 3 in the fair value hierarchy. The fair value of U.S. Treasury securities and certain equity securities with readily determinable fair value are based on unadjusted quoted prices in active markets for identical securities. As such, these securities are classified as Level 1 in the fair value hierarchy.
The Company’s Investment Operations Department is responsible for the valuation of Level 3 available-for-sale debt securities. The methodology and variables used as inputs in pricing Level 3 securities are derived from a combination of observable and unobservable inputs. The unobservable inputs are determined through internal assumptions that may vary from period to period due to external factors, such as market movement and credit rating adjustments.
33
Table of Contents
At March 31, 2026, the Company classified $114.2 million of municipal securities as Level 3. These municipal securities are bond issuances for various municipal government entities primarily located in the Chicago metropolitan area, southern Wisconsin and west Michigan and are privately placed, non-rated bonds without CUSIP numbers. The Company’s methodology for pricing these securities focuses on three distinct inputs: equivalent rating, yield and other pricing terms. To determine the rating for a given non-rated investment debt security, the Investment Operations Department references a rated, publicly issued bond by the same issuer if available. A reduction is then applied to the rating obtained from the comparable bond, as the Company believes if liquidated, a non-rated bond would be valued less than a similar bond with a verifiable rating. The reduction applied by the Company is one complete rating grade (i.e., a “AA” rating for a comparable bond would be reduced to “A” for the Company’s valuation). For bond issuances without comparable bond proxies, a rating of “BBB” was assigned. In the first quarter of 2026, all of the ratings derived by the Investment Operations Department using the above process were “BBB” or better. The fair value measurement noted above is sensitive to the rating input, as a higher rating typically results in an increased valuation. The remaining pricing inputs used in the bond valuation are observable. Based on the rating determined in the above process, Investment Operations obtains a corresponding current market yield curve available to market participants. Other terms including coupon, maturity date, redemption price, number of coupon payments per year, and accrual method are obtained from the individual bond term sheets. Certain municipal bonds held by the Company at March 31, 2026 are continuously callable. When valuing these bonds, the fair value is capped at par value as the Company assumes a market participant would not pay more than par for a continuously callable bond.
Mortgage loans held-for-sale—The fair value of mortgage loans held-for-sale is typically determined by reference to investor price sheets for loan products with similar characteristics. Loans measured with this valuation technique are classified as Level 2 in the fair value hierarchy.
At March 31, 2026, the Company classified $52.5 million of certain delinquent mortgage loans held-for-sale as Level 3. For such delinquent loans in which investor interest may be limited, the Company estimates fair value by discounting future scheduled cash flows for the specific loan through its life, adjusted for estimated credit losses. The Company uses a discount rate based on prevailing market coupon rates on loans with similar characteristics. The assumed weighted average discount rate used as an input to value these loans at March 31, 2026 was 5.63 %. The higher the rate utilized to discount estimated future cash flows, the lower the fair value measurement. Additionally, the weighted average credit discount used as an input to value the specific loans was 0.52 % with credit loss discount ranging from 0 %-37 % at March 31, 2026.
Loans held-for-investment—The fair value of loans held-for-investment is typically determined by reference to investor price sheets for loan products with similar characteristics. Loans measured with this valuation technique are classified as Level 2 in the fair value hierarchy.
The fair value for certain loans in which the Company previously elected the fair value option is estimated by discounting future scheduled cash flows for the specific loan through maturity, adjusted for estimated credit losses and prepayment or life assumptions. These loans primarily consist of early buyout loans guaranteed by U.S. government agencies that are delinquent and, as a result, investor interest may be limited. The Company uses a discount rate based on the actual coupon rate of the underlying loan. At March 31, 2026, the Company classified $55.4 million of loans held-for-investment carried at fair value as Level 3. The assumed weighted average discount rate used as an input to value these loans at March 31, 2026 was 6.13 %. The higher the rate utilized to discount estimated future cash flows, the lower the fair value measurement. As noted above, the fair value estimate also includes assumptions of prepayment speeds and average life as well as credit losses. The weighted average prepayments speed used as an input to value current loans was 9.26 % at March 31, 2026. Prepayment speeds are inversely related to the fair value of these loans as an increase in prepayment speeds results in a decreased valuation. For delinquent loans in which performance is not assumed and there is a higher probability of resolution of the loan ending in foreclosure, the weighted average life of such loans was 5.2 years. Average life is inversely related to the fair value of these loans as an increase in estimated life results in a decreased valuation. Additionally, the weighted average credit discount used as an input to value the specific loans was 1.65 % with credit loss discounts ranging from 0 %-55 % at March 31, 2026.
MSRs—Fair value for MSRs is determined utilizing a valuation model which calculates the fair value of each servicing right based on the present value of estimated future cash flows. The Company uses a discount rate commensurate with the risk associated with each servicing right, given current market conditions. At March 31, 2026, the Company classified $195.3 million of MSRs as Level 3. The weighted average discount rate used as an input to value the pool of MSRs at March 31, 2026 was 9.83 % with discount rates applied ranging from 9 %-12 %. The higher the rate utilized to discount estimated future cash flows, the lower the fair value measurement. The fair value of MSRs was also estimated based on other assumptions including prepayment speeds and the cost to service. Prepayment speeds ranged from 3 %-84 % or a weighted average prepayment speed of 10.05 %. Further, for current and delinquent loans, the Company assumed a weighted average cost of servicing of $76 and $399 , respectively, per loan. Prepayment speeds and the cost to service are both inversely related to the fair value of MSRs as
34
Table of Contents
an increase in prepayment speeds or the cost to service results in a decreased valuation. See Note (9) “Mortgage Servicing Rights (“MSRs”)” in Item 1 of this report for further discussion of MSRs.
Derivative instruments—The Company’s derivative instruments include swaps, collars and purchased options such as caps and floors, commitments to fund mortgages for sale into the secondary market (interest rate locks), forward commitments to end investors for the sale of mortgage loans, commodity future contracts and foreign currency contracts. Swaps, collars and purchased options such as caps and floors and commodity future contracts are valued by a third party, using models that primarily use market observable inputs, such as yield curves and commodity prices prevailing at the measurement date, and are classified as Level 2 in the fair value hierarchy. The credit risk associated with derivative financial instruments that are subject to master netting agreements is measured on a net basis by counterparty portfolio. The fair value for mortgage-related derivatives is based on changes in mortgage rates from the date of the commitments. The fair value of foreign currency derivatives is computed based on change in foreign currency rates stated in the contract compared to those prevailing at the measurement date.
At March 31, 2026, the Company classified $4.5 million of derivative assets related to interest rate locks as Level 3. The fair value of interest rate locks is based on prices obtained for loans with similar characteristics from third parties, adjusted for the pull-through rate, which represents the Company’s best estimate of the likelihood that a committed loan will ultimately fund. The weighted-average pull-through rate at March 31, 2026 was 87.31 % with pull-through rates applied ranging from 12 % to 100 %. Pull-through rates are directly related to the fair value of interest rate locks as an increase in the pull-through rate results in an increased valuation.
Nonqualified deferred compensation assets—The underlying assets relating to the nonqualified deferred compensation plan are included in a trust and primarily consist of non-exchange traded institutional funds which are priced based by an independent third party service. These assets are classified as Level 2 in the fair value hierarchy.
35
Table of Contents
The following tables present the balances of assets and liabilities measured at fair value on a recurring basis for the periods presented:
| March 31, 2026 | |||||||||||||||||||||||
| (In thousands) | Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||||
| Available-for-sale securities | |||||||||||||||||||||||
| U.S. Treasury | $ | $ | $ | $ | |||||||||||||||||||
| U.S. government agencies | |||||||||||||||||||||||
| Municipal | |||||||||||||||||||||||
| Corporate notes | |||||||||||||||||||||||
| Mortgage-backed | |||||||||||||||||||||||
| Equity securities with readily determinable fair value | |||||||||||||||||||||||
| Mortgage loans held-for-sale | |||||||||||||||||||||||
| Loans held-for-investment | |||||||||||||||||||||||
| MSRs | |||||||||||||||||||||||
| Nonqualified deferred compensation assets | |||||||||||||||||||||||
| Derivative assets | |||||||||||||||||||||||
| Total | $ | $ | $ | $ | |||||||||||||||||||
| Derivative liabilities | $ | $ | $ | $ | |||||||||||||||||||
| December 31, 2025 | ||||||||||||||||||||||||||
| (In thousands) | Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||||
| Available-for-sale securities | ||||||||||||||||||||||||||
| U.S. Treasury | $ | $ | $ | $ | ||||||||||||||||||||||
| U.S. government agencies | ||||||||||||||||||||||||||
| Municipal | ||||||||||||||||||||||||||
| Corporate notes | ||||||||||||||||||||||||||
| Mortgage-backed | ||||||||||||||||||||||||||
| Equity securities with readily determinable fair value | ||||||||||||||||||||||||||
| Mortgage loans held-for-sale | ||||||||||||||||||||||||||
| Loans held-for-investment | ||||||||||||||||||||||||||
| MSRs | ||||||||||||||||||||||||||
| Nonqualified deferred compensation assets | ||||||||||||||||||||||||||
| Derivative assets | ||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||||||||||||
| Derivative liabilities | $ | $ | $ | $ | ||||||||||||||||||||||
| March 31, 2025 | |||||||||||||||||||||||
| (In thousands) | Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||||
| Available-for-sale securities | |||||||||||||||||||||||
| U.S. Treasury | $ | $ | $ | $ | |||||||||||||||||||
| U.S. government agencies | |||||||||||||||||||||||
| Municipal | |||||||||||||||||||||||
| Corporate notes | |||||||||||||||||||||||
| Mortgage-backed | |||||||||||||||||||||||
| Equity securities with readily determinable fair value | |||||||||||||||||||||||
| Mortgage loans held-for-sale | |||||||||||||||||||||||
| Loans held-for-investment | |||||||||||||||||||||||
| MSRs | |||||||||||||||||||||||
| Nonqualified deferred compensation assets | |||||||||||||||||||||||
| Derivative assets | |||||||||||||||||||||||
| Total | $ | $ | $ | $ | |||||||||||||||||||
| Derivative liabilities | $ | $ | $ | $ | |||||||||||||||||||
The aggregate remaining contractual principal balance outstanding as of March 31, 2026, December 31, 2025 and March 31, 2025 for mortgage loans held-for-sale measured at fair value under ASC 825 was $387.9 million, $343.3 million and $319.6 million, respectively, while the aggregate fair value of mortgage loans held-for-sale was $383.4 million, $340.7 million and
36
Table of Contents
$316.8 million, for the same respective periods, as shown in the above tables. At March 31, 2026, $900,000 of mortgage loans held-for-sale were classified as nonaccrual compared to $700,000 as of December 31, 2025 and $2.8 million as of March 31, 2025. Additionally, there were $51.9 million of loans past due greater than 90 days and still accruing in the mortgage loans held-for-sale portfolio as of March 31, 2026 compared to $53.1 million as of December 31, 2025 and $56.2 million as of March 31, 2025. All of the nonaccrual loans and loans past due greater than 90 days and still accruing within the mortgage loans held-for-sale portfolio at March 31, 2026, December 31, 2025, and March 31, 2025 were individual delinquent mortgage loans bought back from GNMA at the unconditional option of the Company as servicer for those loans.
The aggregate remaining contractual principal balance outstanding as of March 31, 2026, December 31, 2025 and March 31, 2025 for loans held-for-investment measured at fair value under ASC 825 was $146.1 million, $148.1 million and $126.5 million, respectively, while the aggregate fair value of loans held-for-investment was $150.5 million, $151.6 million and $126.5 million, respectively, as shown in the above tables.
The changes in Level 3 assets measured at fair value on a recurring basis during the three months ended March 31, 2026 and 2025 are summarized as follows:
| Mortgage loans held-for-sale | Loans held-for- investment | Mortgage servicing rights | Derivative assets | ||||||||||||||||||||||||||||||||
| (In thousands) | Municipal | ||||||||||||||||||||||||||||||||||
| Balance at January 1, 2026 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||
| Total net (losses) gains included in: | |||||||||||||||||||||||||||||||||||
Net income (1) | ( | ||||||||||||||||||||||||||||||||||
| Other comprehensive income or loss | ( | ||||||||||||||||||||||||||||||||||
| Purchases | |||||||||||||||||||||||||||||||||||
| Settlements | ( | ( | ( | ||||||||||||||||||||||||||||||||
Net transfers into Level 3 | |||||||||||||||||||||||||||||||||||
| Balance at March 31, 2026 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||
(1)Changes in the balance of mortgage loans held-for-sale, MSRs, and derivative assets related to fair value adjustments are recorded as components of mortgage banking revenue. Changes in the balance of loans held-for-investment related to fair value adjustments are recorded as other non-interest income.
| Mortgage loans held-for-sale | Loans held-for- investment | Mortgage servicing rights | Derivative assets | ||||||||||||||||||||||||||||||||
| (In thousands) | Municipal | ||||||||||||||||||||||||||||||||||
| Balance at January 1, 2025 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||
| Total net gains (losses) included in: | |||||||||||||||||||||||||||||||||||
Net income (1) | ( | ||||||||||||||||||||||||||||||||||
| Other comprehensive income or loss | ( | ||||||||||||||||||||||||||||||||||
| Purchases | |||||||||||||||||||||||||||||||||||
| Settlements | ( | ( | ( | ||||||||||||||||||||||||||||||||
| Net transfers into Level 3 | |||||||||||||||||||||||||||||||||||
| Balance at March 31, 2025 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||
37
Table of Contents
Also, the Company may be required, from time to time, to measure certain other assets at fair value on a non-recurring basis in accordance with GAAP. These adjustments to fair value usually result from impairment charges on individual assets. For assets measured at fair value on a non-recurring basis that were still held in the balance sheet at the end of the period, the following table provides the carrying value of the related individual assets or portfolios at March 31, 2026:
| March 31, 2026 | Three Months Ended March 31, 2026 Fair Value Losses Recognized, net | ||||||||||||||||||||||||||||||||||
| (In thousands) | Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||||||||||||||||
| Individually assessed loans - foreclosure probable and collateral-dependent | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||
Other real estate owned (1) | |||||||||||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||
(1)Net fair value losses recognized on other real estate owned include valuation adjustments and charge-offs during the respective period.
Individually assessed loans—In accordance with ASC 326, the allowance for credit losses for loans and other financial assets
held at amortized cost should be measured on a collective or pooled basis when such assets exhibit similar risk characteristics. In instances in which a financial asset does not exhibit similar risk characteristics to a pool, the Company is required to measure such allowance for credit losses on an individual asset basis. For the Company’s loan portfolio, nonaccrual loans are considered to not exhibit similar risk characteristics as pools and thus are individually assessed. Credit losses are measured by estimating the fair value of the loan based on the present value of expected cash flows, the market price of the loan, or the fair value of the underlying collateral. Individually assessed loans are considered a fair value measurement where an allowance for credit loss is established based on the fair value of collateral. Appraised values on relevant real estate properties, which may require adjustments to market-based valuation inputs, are generally used on foreclosure probable and collateral-dependent loans within the real estate portfolios.
The Company’s Managed Assets Division is primarily responsible for the valuation of Level 3 inputs of individually assessed loans. For more information on individually assessed loans refer to Note (7) “Allowance for Credit Losses” in Item 1 of this report. At March 31, 2026, the Company had $132.9 million of individually assessed loans classified as Level 3. All of the $132.9 million of individually assessed loans were measured at fair value based on the underlying collateral of the loan as shown in the table above.
Other real estate owned —Other real estate owned is comprised of real estate acquired in partial or full satisfaction of loans and is included in other assets. Other real estate owned is recorded at its estimated fair value less estimated selling costs at the date of transfer, with any excess of the related loan balance over the fair value less expected selling costs charged to the allowance for loan losses. Subsequent changes in value are reported as adjustments to the carrying amount and are recorded in other non-interest expense. Gains and losses upon sale, if any, are also charged to other non-interest expense. Fair value is generally based on third party appraisals and internal estimates that are adjusted by a discount representing the estimated cost of sale and is therefore considered a Level 3 valuation.
The Company’s Managed Assets Division is primarily responsible for the valuation of Level 3 inputs for other real estate owned. At March 31, 2026, the Company had $17.4 million of other real estate owned classified as Level 3. The unobservable input applied to other real estate owned relates to the 10 % reduction to the appraisal value representing the estimated cost of sale of the foreclosed property. A higher discount for the estimated cost of sale results in a decreased carrying value.
38
Table of Contents
The valuation techniques and significant unobservable inputs used to measure both recurring and non-recurring Level 3 fair value measurements at March 31, 2026 were as follows:
| (Dollars in thousands) | Fair Value | Valuation Methodology | Significant Unobservable Input | Input / Range of Inputs | Weighted Average of Inputs | Impact to valuation from an increased or higher input value | |||||||||||||||||||||||||||||
| Measured at fair value on a recurring basis: | |||||||||||||||||||||||||||||||||||
| Municipal securities | $ | Bond pricing | Equivalent rating | BBB-AA+ | N/A | Increase | |||||||||||||||||||||||||||||
| Mortgage loans held-for-sale | Discounted cash flows | Discount rate | Decrease | ||||||||||||||||||||||||||||||||
| Credit discount | Decrease | ||||||||||||||||||||||||||||||||||
| Loans held-for-investment | Discounted cash flows | Discount rate | Decrease | ||||||||||||||||||||||||||||||||
| Credit discount | Decrease | ||||||||||||||||||||||||||||||||||
| Constant prepayment rate (CPR) - current loans | Decrease | ||||||||||||||||||||||||||||||||||
| Average life - delinquent loans (in years) | Decrease | ||||||||||||||||||||||||||||||||||
| MSRs | Discounted cash flows | Discount rate | Decrease | ||||||||||||||||||||||||||||||||
| Constant prepayment rate (CPR) | Decrease | ||||||||||||||||||||||||||||||||||
| Cost of servicing | $ | $ | Decrease | ||||||||||||||||||||||||||||||||
| Cost of servicing - delinquent | $ | $ | Decrease | ||||||||||||||||||||||||||||||||
| Derivatives | Discounted cash flows | Pull-through rate | % | Increase | |||||||||||||||||||||||||||||||
| Measured at fair value on a non-recurring basis: | |||||||||||||||||||||||||||||||||||
| Individually assessed loans - foreclosure probable and collateral-dependent | Appraisal value | Appraisal adjustment - cost of sale | Decrease | ||||||||||||||||||||||||||||||||
| Other real estate owned | Appraisal value | Appraisal adjustment - cost of sale | Decrease | ||||||||||||||||||||||||||||||||
39
Table of Contents
The Company is required under applicable accounting guidance to report the fair value of all financial instruments on the Consolidated Statements of Condition, including those financial instruments carried at cost. The table below presents the carrying amounts and estimated fair values of the Company’s financial instruments as of the dates shown:
| At March 31, 2026 | At December 31, 2025 | At March 31, 2025 | |||||||||||||||||||||||||||||||||
| Carrying | Fair | Carrying | Fair | Carrying | Fair | ||||||||||||||||||||||||||||||
| (In thousands) | Value | Value | Value | Value | Value | Value | |||||||||||||||||||||||||||||
| Financial Assets: | |||||||||||||||||||||||||||||||||||
| Cash and cash equivalents | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Interest-bearing deposits with banks | |||||||||||||||||||||||||||||||||||
| Available-for-sale securities | |||||||||||||||||||||||||||||||||||
| Held-to-maturity securities | |||||||||||||||||||||||||||||||||||
| Equity securities with readily determinable fair value | |||||||||||||||||||||||||||||||||||
| FHLB and FRB stock, at cost | |||||||||||||||||||||||||||||||||||
| Mortgage loans held-for-sale, at fair value | |||||||||||||||||||||||||||||||||||
| Loans held-for-investment, at fair value | |||||||||||||||||||||||||||||||||||
| Loans held-for-investment, at amortized cost | |||||||||||||||||||||||||||||||||||
| Nonqualified deferred compensation assets | |||||||||||||||||||||||||||||||||||
| Derivative assets | |||||||||||||||||||||||||||||||||||
| Accrued interest receivable and other | |||||||||||||||||||||||||||||||||||
| Total financial assets | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Financial Liabilities: | |||||||||||||||||||||||||||||||||||
| Non-maturity deposits | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Deposits with stated maturities | |||||||||||||||||||||||||||||||||||
| FHLB advances | |||||||||||||||||||||||||||||||||||
| Other borrowings | |||||||||||||||||||||||||||||||||||
| Subordinated notes | |||||||||||||||||||||||||||||||||||
| Junior subordinated debentures | |||||||||||||||||||||||||||||||||||
| Derivative liabilities | |||||||||||||||||||||||||||||||||||
| Accrued interest payable | |||||||||||||||||||||||||||||||||||
| Total financial liabilities | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Not all the financial instruments listed in the table above are subject to the disclosure provisions of ASC Topic 820, as certain assets and liabilities result in their carrying value approximating fair value. These include cash and cash equivalents, interest-bearing deposits with banks, brokerage customer receivables, FHLB and FRB stock, accrued interest receivable and accrued interest payable and non-maturity deposits.
The following methods and assumptions were used by the Company in estimating fair values of financial instruments that were not previously disclosed.
Held-to-maturity securities — Held-to-maturity securities include U.S. government-sponsored agency securities, municipal bonds issued by various municipal government entities primarily located in the Chicago metropolitan area, southern Wisconsin, and west Michigan and mortgage-backed securities. Fair values for held-to-maturity securities are typically based on prices obtained from independent pricing vendors. In accordance with ASC 820, the Company has generally categorized these held-to-maturity securities as a Level 2 fair value measurement. Fair values for certain other held-to-maturity securities are based on the bond pricing methodology discussed previously related to certain available-for-sale securities. In accordance with ASC 820, the Company has categorized these held-to-maturity securities as a Level 3 fair value measurement.
Loans held-for-investment, at amortized cost — Fair values are estimated for portfolios of loans with similar financial characteristics. Loans are analyzed by type (commercial, residential real estate, etc.) and category within each type (construction, non-construction, franchise lending etc.). Each category is further segmented by interest rate type (fixed and variable). The fair value of both fixed and variable rate loans is estimated by discounting scheduled cash flows through the estimated maturity using estimated market discount rates that reflect credit and interest rate risks inherent in the loan. In accordance with ASC 820, the Company has categorized loans as a Level 3 fair value measurement.
40
Table of Contents
Deposits with stated maturities — The fair value of certificates of deposit is based on the discounted value of contractual cash flows. The discount rate is estimated using the rates currently in effect for deposits of similar remaining maturities. In accordance with ASC 820, the Company has categorized deposits with stated maturities as a Level 3 fair value measurement.
FHLB advances — The fair value of FHLB advances is calculated using a discounted cash flow analysis based on current market rates of similar maturity debt securities to discount cash flows. In accordance with ASC 820, the Company has categorized FHLB advances as a Level 3 fair value measurement.
Subordinated notes — The fair value of the subordinated notes is based on a market price obtained from an independent pricing vendor. In accordance with ASC 820, the Company has categorized subordinated notes as a Level 2 fair value measurement.
(16) Stock-Based Compensation Plans
As of March 31, 2026, approximately 1,856,000 shares were available for future grants, assuming the maximum number of shares are issued for the performance awards outstanding, approved under the Company Stock Incentive Plans (“the Plans”). Descriptions of the Plans are included in Note (18) “Stock Compensation Plans and Other Employee Benefit Plans” of the 2025 Form 10-K.
Stock-based compensation expense recognized in the Consolidated Statements of Income was $11.3 million in the first quarter of 2026 and $10.4 million in the first quarter of 2025.
A summary of the Plans’ stock option activity for the three months ended March 31, 2026 and March 31, 2025 is presented below:
| Stock Options | Common Shares | Weighted Average Strike Price | Remaining Contractual Term (1) | Intrinsic Value (2) (in thousands) | |||||||||||||||||||
Outstanding at January 1, 2026 | $ | ||||||||||||||||||||||
| Granted | |||||||||||||||||||||||
| Exercised | ( | ||||||||||||||||||||||
| Forfeited or canceled | |||||||||||||||||||||||
Outstanding at March 31, 2026 | $ | $ | |||||||||||||||||||||
Exercisable at March 31, 2026 | $ | $ | |||||||||||||||||||||
| Stock Options | Common Shares | Weighted Average Strike Price | Remaining Contractual Term (1) | Intrinsic Value (2) (in thousands) | |||||||||||||||||||
Outstanding at January 1, 2025 | $ | ||||||||||||||||||||||
| Granted | |||||||||||||||||||||||
| Exercised | ( | ||||||||||||||||||||||
| Forfeited or canceled | |||||||||||||||||||||||
Outstanding at March 31, 2025 | $ | $ | |||||||||||||||||||||
Exercisable at March 31, 2025 | $ | $ | |||||||||||||||||||||
(1)Represents the remaining weighted average contractual life in years.
(2)Aggregate intrinsic value represents the total pre-tax intrinsic value (i.e., the difference between the Company’s stock price on the last trading day of the quarter and the option exercise price, multiplied by the number of shares) that would have been received by the option holders if they had exercised their options on the last day of the quarter. Options with exercise prices above the stock price on the last trading day of the quarter are excluded from the calculation of intrinsic value. The intrinsic value will change based on the fair market value of the Company’s stock.
The aggregate intrinsic value of options exercised during the three months ended March 31, 2026 and March 31, 2025, was approximately $250,000 and $467,000 , respectively. Cash received from option exercises under the Plans for the three months ended March 31, 2026 and March 31, 2025 was approximately $95,000 and $219,000 , respectively.
41
Table of Contents
A summary of the Plans’ restricted share activity for the three months ended March 31, 2026 and March 31, 2025 is presented below:
| Three months ended March 31, 2026 | Three months ended March 31, 2025 | ||||||||||||||||||||||
| Restricted Shares | Common Shares | Weighted Average Grant-Date Fair Value | Common Shares | Weighted Average Grant-Date Fair Value | |||||||||||||||||||
| Outstanding at January 1 | $ | $ | |||||||||||||||||||||
| Granted | |||||||||||||||||||||||
| Vested and issued | ( | ( | |||||||||||||||||||||
| Forfeited or canceled | ( | ( | |||||||||||||||||||||
Outstanding at March 31 | $ | $ | |||||||||||||||||||||
Vested, but deferred, at March 31 | $ | $ | |||||||||||||||||||||
A summary of the Plans’ performance-based stock award activity, based on the target level of the awards, for the three months ended March 31, 2026 and March 31, 2025 is presented below:
| Three months ended March 31, 2026 | Three months ended March 31, 2025 | ||||||||||||||||||||||
| Performance-based Stock | Common Shares | Weighted Average Grant-Date Fair Value | Common Shares | Weighted Average Grant-Date Fair Value | |||||||||||||||||||
| Outstanding at January 1 | $ | $ | |||||||||||||||||||||
| Granted | |||||||||||||||||||||||
| Added by performance factor at vesting, net | |||||||||||||||||||||||
| Vested and issued | ( | ( | |||||||||||||||||||||
| Forfeited or canceled | ( | ( | |||||||||||||||||||||
Outstanding at March 31 | $ | $ | |||||||||||||||||||||
Vested, but deferred, at March 31 | $ | $ | |||||||||||||||||||||
(17) Accumulated Other Comprehensive Income or Loss and Earnings Per Share
Accumulated Other Comprehensive Income or Loss
The following tables summarize the components of other comprehensive income or loss, including the related income tax effects, and the related amount reclassified to net income for the periods presented:
| (In thousands) | Accumulated Unrealized (Losses) Gains on Securities | Accumulated Unrealized Gains (Losses) on Derivative Instruments | Accumulated Foreign Currency Translation Adjustments | Total Accumulated Other Comprehensive (Loss) Income | |||||||||||||||||||
| Balance at January 1, 2026 | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
| Other comprehensive loss during the period, net of tax, before reclassifications | ( | ( | ( | ( | |||||||||||||||||||
| Amount reclassified from accumulated other comprehensive income or loss into net income, net of tax | ( | ( | |||||||||||||||||||||
| Amount reclassified from accumulated other comprehensive income or loss related to amortization of unrealized gains on investment securities transferred to held-to-maturity from available-for-sale, net of tax | ( | ( | |||||||||||||||||||||
| Net other comprehensive loss during the period, net of tax | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Balance at March 31, 2026 | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
| Balance at January 1, 2025 | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Other comprehensive income (loss) during the period, net of tax, before reclassifications | ( | ||||||||||||||||||||||
| Amount reclassified from accumulated other comprehensive income or loss into net income, net of tax | |||||||||||||||||||||||
| Amount reclassified from accumulated other comprehensive income or loss related to amortization of unrealized gains on investment securities transferred to held-to-maturity from available-for-sale, net of tax | ( | ( | |||||||||||||||||||||
| Net other comprehensive income (loss) during the period, net of tax | $ | $ | $ | ( | $ | ||||||||||||||||||
| Balance at March 31, 2025 | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
42
Table of Contents
| (In thousands) | Amount Reclassified from Accumulated Other Comprehensive Income or Loss for the | |||||||||||||||||||||||||||||||
| Details Regarding the Component of Accumulated Other Comprehensive Income or Loss | Three Months Ended | Impacted Line on the Consolidated Statements of Income | ||||||||||||||||||||||||||||||
| March 31, | ||||||||||||||||||||||||||||||||
| 2026 | 2025 | |||||||||||||||||||||||||||||||
| Accumulated unrealized losses on securities | ||||||||||||||||||||||||||||||||
| Losses included in net income | $ | ( | $ | ( | (Losses) gains on investment securities, net | |||||||||||||||||||||||||||
| ( | ( | Income before taxes | ||||||||||||||||||||||||||||||
| Tax effect | Income tax expense | |||||||||||||||||||||||||||||||
| Net of tax | $ | ( | $ | ( | Net income | |||||||||||||||||||||||||||
| Accumulated unrealized (losses) gains on derivative instruments | ||||||||||||||||||||||||||||||||
| Amount reclassified to interest income on loans | $ | ( | $ | Interest on Loans | ||||||||||||||||||||||||||||
| Amount reclassified to interest expense on deposits | ( | ( | Interest on deposits | |||||||||||||||||||||||||||||
| ( | Income before taxes | |||||||||||||||||||||||||||||||
| Tax effect | ( | Income tax expense | ||||||||||||||||||||||||||||||
| Net of tax | $ | $ | ( | Net income | ||||||||||||||||||||||||||||
Earnings per Share
The following table shows the computation of basic and diluted earnings per share for the periods indicated:
| Three Months Ended | |||||||||||||||||||||||||||||
| (Dollars in thousands, except per share data) | March 31, 2026 | March 31, 2025 | |||||||||||||||||||||||||||
| Net income | $ | $ | |||||||||||||||||||||||||||
| Less: Preferred stock dividends | |||||||||||||||||||||||||||||
| Net income applicable to common shares | (A) | $ | $ | ||||||||||||||||||||||||||
| Weighted average common shares outstanding | (B) | ||||||||||||||||||||||||||||
| Effect of dilutive potential common shares | |||||||||||||||||||||||||||||
| Common stock equivalents | |||||||||||||||||||||||||||||
| Weighted average common shares and effect of dilutive potential common shares | (C) | ||||||||||||||||||||||||||||
| Net income per common share: | |||||||||||||||||||||||||||||
| Basic | (A/B) | $ | $ | ||||||||||||||||||||||||||
| Diluted | (A/C) | $ | $ | ||||||||||||||||||||||||||
Potentially dilutive common shares can result from stock options, restricted stock unit awards and shares to be issued under the Employee Stock Purchase Plan and the Directors Deferred Fee and Stock Plan, being treated as if they had been either exercised or issued, computed by application of the treasury stock method. While potentially dilutive common shares are typically included in the computation of diluted earnings per share, potentially dilutive common shares are excluded from this computation in periods in which the effect of inclusion would either reduce the loss per share or increase the income per share.
At the January 2026 meeting of the Board of Directors of the Company (the “Board of Directors”), a quarterly cash dividend of $0.55 per share ($2.20 on an annualized basis) was declared. It was paid on February 19, 2026 to shareholders of record as of February 5, 2026.
43
Table of Contents
ITEM 2
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of the financial condition of Wintrust Financial Corporation and its subsidiaries (collectively, “Wintrust” or the “Company”) as of March 31, 2026 compared with December 31, 2025 and March 31, 2025, and the results of operations for the three month periods ended March 31, 2026 and March 31, 2025, should be read in conjunction with the unaudited consolidated financial statements and notes contained in this report and the risk factors discussed under Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 (“2025 Form 10-K”) and in Part II, Item 1A, of this Form 10-Q. This discussion contains forward-looking statements that involve risks and uncertainties and, as such, future results could differ significantly from management’s current expectations. See the last section of this discussion for further information on forward-looking statements.
Introduction
Wintrust is a financial holding company that provides traditional community and commercial banking services and offers a full array of wealth management services, primarily to customers in the Chicago metropolitan area, southern Wisconsin, northwest Indiana, and west Michigan, and operates other financing businesses on a national basis and in Canada through several non-bank businesses.
Overview
First Quarter Highlights
The Company recorded net income of $227.4 million for the first quarter of 2026 compared to $189.0 million in the first quarter of 2025. The results for the first quarter of 2026 demonstrate increased net interest income due to growth in earning assets as well as the Company’s ability to navigate disruptions in the current economic environment during the period due to the Company’s strong deposit franchise and balanced business model. Partially offsetting the increase in net interest income was an increase in non-interest expense. The increase in non-interest expense was a result of additional expenses to support growth. Comprehensive income includes 1) net income as presented on the Company’s Consolidated Statements of Income and 2) other comprehensive income or loss from unrealized gains and losses on the Company’s available-for-sale investment securities portfolios and derivative contracts designated as cash flow hedges as well as foreign currency translation adjustments. Comprehensive income totaled $156.3 million for the first quarter of 2026 compared to $287.4 million for the first quarter of 2025.
The Company increased its loan portfolio from $48.7 billion at March 31, 2025 and $53.1 billion at December 31, 2025 to $54.1 billion at March 31, 2026. The increase in the current period compared to the prior periods was a result of growth in several portfolios, including the commercial, commercial real estate, and residential real estate loans held for investment portfolios. For more information regarding changes in the Company’s loan portfolio, see Financial Condition – Interest Earning Assets and Note (6) “Loans” of the Consolidated Financial Statements in Item 1 of this report.
The Company recorded net interest income of $579.0 million in the first quarter of 2026 compared to $526.5 million in the first quarter of 2025. This increase in net interest income recorded in the first quarter of 2026 compared to the first quarter of 2025 resulted primarily from growth in earning assets, specifically a $5.0 billion increase in average loans. Net interest margin held steady at 3.54% (3.56% on a fully taxable-equivalent basis, non-GAAP) in the first quarter of 2026 and 2025 (see “Net Interest Income” for further detail).
Non-interest income totaled $134.1 million in the first quarter of 2026 compared to $116.6 million in the first quarter of 2025. The increase is primarily due to an increase in wealth management revenue of $8.0 million, an increase in operating lease income of $3.9 million, and an increase in mortgage banking revenue of $2.9 million in the first quarter of 2026 compared to the first quarter of 2025. This was partially offset by net losses on investment securities of $31,000 compared to approximately $3.2 million in net gains recognized in the first quarter of 2025 (see “Non-Interest Income” for further detail).
Non-interest expense totaled $382.6 million in the first quarter of 2026, an increase of $16.5 million, or 5%, compared to the first quarter of 2025. This increase compared to the first quarter of 2025 was primarily attributable to increased salaries and employee benefits of $16.9 million (see “Non-Interest Expense” for further detail).
Management considers the maintenance of adequate liquidity to be important to the management of risk. Accordingly, during the first quarter of 2026, the Company continued its practice of maintaining appropriate funding capacity to provide the
44
Table of Contents
Company with adequate liquidity for its ongoing operations. In this regard, the Company benefited from its strong deposit base, a liquid investment portfolio and its access to funding from a variety of external funding sources. See “Shareholders’ Equity”, “Deposits” and “Other Funding Sources” for additional information regarding liquidity sources.
RESULTS OF OPERATIONS
Earnings Summary
The Company’s key operating measures and growth rates for the three months ended March 31, 2026, as compared to the same period last year, are shown below:
| Three months ended | |||||||||||||||||
| (Dollars in thousands, except per share data) | March 31, 2026 | March 31, 2025 | Percentage (%) or Basis Point (bp) Change | ||||||||||||||
| Net income | $ | 227,388 | $ | 189,039 | 20 | % | |||||||||||
Pre-tax income, excluding provision for credit losses (non-GAAP) (1) | 330,534 | 277,018 | 19 | ||||||||||||||
| Net income per common share—Diluted | 3.22 | 2.69 | 20 | ||||||||||||||
Net revenue (2) | 713,166 | 643,108 | 11 | ||||||||||||||
| Net interest income | 579,024 | 526,474 | 10 | ||||||||||||||
| Net interest margin | 3.54 | % | 3.54 | % | — | bps | |||||||||||
Net interest margin - fully taxable-equivalent (non-GAAP) (1) | 3.56 | 3.56 | — | ||||||||||||||
Net overhead ratio (3) | 1.44 | 1.58 | (14) | ||||||||||||||
| Return on average assets | 1.32 | 1.20 | 12 | ||||||||||||||
| Return on average common equity | 12.76 | 12.21 | 55 | ||||||||||||||
Return on average tangible common equity (non-GAAP) (1) | 14.89 | 14.72 | 17 | ||||||||||||||
| At end of period | |||||||||||||||||
| Total assets | $ | 72,157,433 | $ | 65,870,066 | 10 | % | |||||||||||
| Total loans, excluding loans held-for-sale | 54,071,292 | 48,708,390 | 11 | ||||||||||||||
| Total loans, including loans held-for-sale | 54,454,697 | 49,025,194 | 11 | ||||||||||||||
| Total deposits | 58,914,382 | 53,570,038 | 10 | ||||||||||||||
| Total shareholders’ equity | 7,378,100 | 6,600,537 | 12 | ||||||||||||||
Book value per common share (1) | 103.10 | 92.47 | 11 | ||||||||||||||
Tangible common book value per share (1) | 89.90 | 78.83 | 14 | ||||||||||||||
| Market price per common share | 138.94 | 112.46 | 24 | ||||||||||||||
| Allowance for loan and unfunded lending-related commitment losses to total loans | 0.87 | % | 0.92 | % | (5) | bps | |||||||||||
(1)See following section titled “Supplemental Non-GAAP Financial Measures/Ratios” for additional information on this performance measure/ratio.
(2)Net revenue is net interest income plus non-interest income.
(3)The net overhead ratio is calculated by netting total non-interest expense and total non-interest income, annualizing this amount, and dividing by that period’s total average assets. A lower ratio indicates a higher degree of efficiency.
Certain returns, yields, performance ratios, and quarterly growth rates are “annualized” throughout this report to represent an annual time period. This is done for analytical purposes to better discern for decision-making purposes underlying performance trends when compared to full-year or year-over-year amounts. For example, balance sheet growth rates are most often expressed in terms of an annual rate. As such, 5% growth during a quarter would represent an annualized growth rate of 20%.
SUPPLEMENTAL NON-GAAP FINANCIAL MEASURES/RATIOS
The accounting and reporting policies of Wintrust conform to generally accepted accounting principles (“GAAP”) in the United States and prevailing practices in the banking industry. However, certain non-GAAP performance measures and ratios are used by management to evaluate and measure the Company’s performance. These include taxable-equivalent net interest income (including its individual components), taxable-equivalent net interest margin (including its individual components), the taxable-equivalent efficiency ratio, tangible common equity ratio, tangible book value per common share, return on average tangible common equity and pre-tax income, excluding provision for credit losses. Management believes that these measures and ratios provide users of the Company’s financial information a more meaningful view of the performance of the Company’s interest-earning assets and interest-bearing liabilities and of the Company’s operating efficiency. Other financial holding companies may define or calculate these measures and ratios differently.
Management reviews yields on certain asset categories and the net interest margin of the Company and its banking subsidiaries on a fully taxable-equivalent (“FTE”) basis. In this non-GAAP presentation, net interest income is adjusted to reflect tax-exempt interest income on an equivalent before-tax basis using tax rates effective as of the end of the period. This measure
45
Table of Contents
ensures comparability of net interest income arising from both taxable and tax-exempt sources. Net interest income on a FTE basis is also used in the calculation of the Company’s efficiency ratio. The efficiency ratio, which is calculated by dividing non-interest expense by total taxable-equivalent net revenue (less securities gains or losses), measures how much it costs to produce one dollar of revenue. Securities gains or losses are excluded from this calculation to better match revenue from daily operations to operational expenses. Management considers the tangible common equity ratio and tangible book value per common share as useful measurements of the Company’s equity. The Company references the return on average tangible common equity as a measurement of profitability. Management considers pre-tax income, excluding provision for credit losses as a useful measurement of the Company’s core net income.
A reconciliation of certain non-GAAP performance measures and ratios used by the Company to evaluate and measure the Company’s performance to the most directly comparable GAAP financial measures is shown below:
| Three Months Ended | |||||||||||||||||||||||||||||
| March 31, | December 31, | March 31, | |||||||||||||||||||||||||||
| (Dollars and shares in thousands) | 2026 | 2025 | 2025 | ||||||||||||||||||||||||||
| Reconciliation of Non-GAAP Net Interest Margin and Efficiency Ratio: | |||||||||||||||||||||||||||||
| (A) Interest Income (GAAP) | $ | 927,560 | $ | 956,326 | $ | 886,965 | |||||||||||||||||||||||
| Taxable-equivalent adjustment: | |||||||||||||||||||||||||||||
- Loans | 2,026 | 2,134 | 2,206 | ||||||||||||||||||||||||||
| - Liquidity Management Assets | 586 | 661 | 690 | ||||||||||||||||||||||||||
| - Other Earning Assets | — | — | 3 | ||||||||||||||||||||||||||
| (B) Interest Income (non-GAAP) | $ | 930,172 | $ | 959,121 | $ | 889,864 | |||||||||||||||||||||||
| (C) Interest Expense (GAAP) | 348,536 | 372,452 | 360,491 | ||||||||||||||||||||||||||
| (D) Net Interest Income (GAAP) (A minus C) | 579,024 | 583,874 | 526,474 | ||||||||||||||||||||||||||
| (E) Net Interest Income, fully taxable-equivalent (non-GAAP) (B minus C) | 581,636 | 586,669 | 529,373 | ||||||||||||||||||||||||||
| Net interest margin (GAAP) | 3.54 | % | 3.52 | % | 3.54 | % | |||||||||||||||||||||||
| Net interest margin, fully taxable-equivalent (non-GAAP) | 3.56 | 3.54 | 3.56 | ||||||||||||||||||||||||||
| (F) Non-interest income | $ | 134,142 | $ | 130,390 | $ | 116,634 | |||||||||||||||||||||||
| (G) (Losses) gains on investment securities, net | (31) | 1,505 | 3,196 | ||||||||||||||||||||||||||
| (H) Non-interest expense | 382,632 | 384,453 | 366,090 | ||||||||||||||||||||||||||
| Efficiency ratio (H/(D+F-G)) | 53.65 | % | 53.94 | % | 57.21 | % | |||||||||||||||||||||||
| Efficiency ratio (non-GAAP) (H/(E+F-G)) | 53.45 | 53.73 | 56.95 | ||||||||||||||||||||||||||
| Reconciliation of Non-GAAP Tangible Common Equity Ratio: | |||||||||||||||||||||||||||||
| Total shareholders’ equity (GAAP) | $ | 7,378,100 | $ | 7,258,715 | $ | 6,600,537 | |||||||||||||||||||||||
| Less: Non-convertible preferred stock (GAAP) | (425,000) | (425,000) | (412,500) | ||||||||||||||||||||||||||
| Less: Acquisition-related intangible assets (GAAP) | (890,698) | (895,959) | (913,004) | ||||||||||||||||||||||||||
| (I) Total tangible common shareholders’ equity (non-GAAP) | $ | 6,062,402 | $ | 5,937,756 | $ | 5,275,033 | |||||||||||||||||||||||
| (J) Total assets (GAAP) | $ | 72,157,433 | $ | 71,142,046 | $ | 65,870,066 | |||||||||||||||||||||||
| Less: Acquisition-related intangible assets (GAAP) | (890,698) | (895,959) | (913,004) | ||||||||||||||||||||||||||
| (K) Total tangible assets (non-GAAP) | $ | 71,266,735 | $ | 70,246,087 | $ | 64,957,062 | |||||||||||||||||||||||
| Common equity to assets ratio (GAAP) (L/J) | 9.6 | % | 9.6 | % | 9.4 | % | |||||||||||||||||||||||
| Tangible common equity ratio (non-GAAP) (I/K) | 8.5 | 8.5 | 8.1 | ||||||||||||||||||||||||||
| Reconciliation of Non-GAAP Tangible Book Value per Common Share: | |||||||||||||||||||||||||||||
| Total shareholders’ equity | $ | 7,378,100 | $ | 7,258,715 | $ | 6,600,537 | |||||||||||||||||||||||
| Less: Non-convertible preferred stock (GAAP) | (425,000) | (425,000) | (412,500) | ||||||||||||||||||||||||||
| (L) Total common equity | $ | 6,953,100 | $ | 6,833,715 | $ | 6,188,037 | |||||||||||||||||||||||
| (M) Actual common shares outstanding | 67,437 | 66,975 | 66,919 | ||||||||||||||||||||||||||
| Book value per common share (L/M) | $ | 103.10 | $ | 102.03 | $ | 92.47 | |||||||||||||||||||||||
| Tangible book value per common share (non-GAAP) (I/M) | 89.90 | 88.66 | 78.83 | ||||||||||||||||||||||||||
46
Table of Contents
| Reconciliation of Non-GAAP Return on Average Tangible Common Equity: | |||||||||||||||||||||||||||||
| (N) Net income applicable to common shares | $ | 219,021 | $ | 214,657 | $ | 182,048 | |||||||||||||||||||||||
| Add: Acquisition-related intangible asset amortization | 4,958 | 4,999 | 5,618 | ||||||||||||||||||||||||||
| Less: Tax effect of acquisition-related intangible asset amortization | (1,210) | (1,310) | (1,421) | ||||||||||||||||||||||||||
| After-tax acquisition-related intangible asset amortization | $ | 3,748 | $ | 3,689 | $ | 4,197 | |||||||||||||||||||||||
| (O) Tangible net income applicable to common shares (non-GAAP) | $ | 222,769 | $ | 218,346 | $ | 186,245 | |||||||||||||||||||||||
| Total average shareholders’ equity | $ | 7,387,713 | $ | 7,166,608 | $ | 6,460,941 | |||||||||||||||||||||||
| Less: Average preferred stock | (425,000) | (425,000) | (412,500) | ||||||||||||||||||||||||||
| (P) Total average common shareholders’ equity | $ | 6,962,713 | $ | 6,741,608 | $ | 6,048,441 | |||||||||||||||||||||||
| Less: Average acquisition-related intangible assets | (894,211) | (901,022) | (916,069) | ||||||||||||||||||||||||||
| (Q) Total average tangible common shareholders’ equity (non-GAAP) | $ | 6,068,502 | $ | 5,840,586 | $ | 5,132,372 | |||||||||||||||||||||||
| Return on average common equity, annualized (N/P) | 12.76 | % | 12.63 | % | 12.21 | % | |||||||||||||||||||||||
| Return on average tangible common equity, annualized (non-GAAP) (O/Q) | 14.89 | 14.83 | 14.72 | ||||||||||||||||||||||||||
| Reconciliation of Non-GAAP Pre-Tax, Pre-Provision Income: | |||||||||||||||||||||||||||||
| Income before taxes | $ | 300,940 | $ | 302,223 | $ | 253,055 | |||||||||||||||||||||||
| Add: Provision for credit losses | 29,594 | 27,588 | 23,963 | ||||||||||||||||||||||||||
| Pre-tax income, excluding provision for credit losses (non-GAAP) | $ | 330,534 | $ | 329,811 | $ | 277,018 | |||||||||||||||||||||||
Critical Accounting Estimates
The Company’s Consolidated Financial Statements are prepared in accordance with GAAP in the United States, prevailing practices of the banking industry, and the application of accounting policies of which are described in Note (1) “Summary of Significant Accounting Policies” to the Consolidated Financial Statements in Item 8 of the Company’s 2025 Form 10-K. These policies require numerous estimates and strategic or economic assumptions, which may prove inaccurate or subject to variations. Changes in underlying factors, assumptions or estimates could have a material impact on the Company’s future financial condition and results of operations. At March 31, 2026, management views critical accounting estimates to include the determination of the allowance for credit losses, estimations of fair value, and the valuation and accounting for derivative instruments, as the accounting areas that require the most subjective and complex judgments, and as such could be most subject to revision as new information becomes available. These estimates were reviewed by the Audit Committee of the Company’s Board of Directors and are discussed in further detail below.
Allowance for Credit Losses, including the Allowance for Loan Losses, Allowance for Losses on Lending-Related Commitments and Allowance for Held-to-Maturity Debt Securities
The allowance for credit losses represents management’s estimate of expected credit losses over the life of a financial asset carried at amortized cost. Determining the amount of the allowance for credit losses is considered a critical accounting estimate because it requires significant judgment and includes the use of estimates related to the fair value of the underlying collateral and amount and timing of expected future cash flows on individually assessed financial assets, estimated credit losses on pools of loans with similar risk characteristics, and consideration of reasonable and supportable forecasts of macroeconomic conditions, all of which are susceptible to significant change. At March 31, 2026, the loan and held-to-maturity debt securities portfolios represent 79% of total assets on the Company’s consolidated balance sheet. The Company also maintains an allowance for lending-related commitments, specifically unfunded loan commitments and letters of credit, which relates to certain amounts the Company is committed to lend (not unconditionally cancelable) but for which funds have not yet been disbursed.
Key macroeconomic variable data points that are significant inputs into our credit loss models for the commercial and commercial real estate portfolios are the Baa corporate credit spread, the Dow Jones Total Stock Market Index for the commercial portfolio, and the Commercial Real Estate Pricing Index ("CREPI") related to the commercial real estate portfolio. Holding all other inputs constant, the table below shows the impact of changes in these key macroeconomic variable data points on the estimate of allowance for credit losses.
| Impact to estimated allowance for credit losses from an increased or higher input value | ||||||||||||||
| Baa Credit Spread | Increases | |||||||||||||
| Dow Jones Total Stock Market Index | Decreases | |||||||||||||
| CRE Pricing Index | Decreases | |||||||||||||
47
Table of Contents
Holding all other inputs constant, the following table provides a sensitivity analysis for the commercial and commercial real estate portfolios based on a 10 basis point change in Baa credit spreads from the assumption utilized in the estimate of that portfolio’s allowance for credit losses at March 31, 2026:
| Baa Credit Spread | ||||||||
| Narrows | Widens | |||||||
| Commercial | Decreases estimate by 5%-10% | Increases estimate by 5%-10% | ||||||
| Commercial Real Estate: | ||||||||
| Construction | Decreases estimate by 5%-10% | Increases estimate by 5%-10% | ||||||
| Non-Construction | Decreases estimate by 2%-3% | Increases estimate by 2-3% | ||||||
Holding all other inputs constant, the following table provides a sensitivity analysis for the commercial portfolio based on a 10% change in the Dow Jones Total Stock Market Index from the assumption utilized in the estimate of that portfolio’s allowance for credit losses at March 31, 2026:
| Dow Jones Total Stock Market Index | ||||||||
| Increases | Decreases | |||||||
| Commercial | Decreases estimate by 5%-10% | Increases estimate by 5%-10% | ||||||
Holding all other inputs constant, the following table provides a sensitivity analysis for the commercial real estate construction and non-construction portfolios based on a 10% change in CREPI from the assumption utilized in the estimate of that portfolio’s allowance for credit losses at March 31, 2026:
| CRE Pricing Index | ||||||||
| Increases | Decreases | |||||||
| Commercial Real Estate: | ||||||||
| Construction | Decreases estimate by 30%-35% | Increases estimate by 125%-130% | ||||||
| Non-Construction | Decreases estimate by 25%-30% | Increases estimate by 40%-45% | ||||||
See Note (7) “Allowance for Credit Losses” to the Consolidated Financial Statements in Item 1 of this report and the section titled “Credit Quality” in Item 2 of this report for a description of the methodology used to determine the allowance for credit losses.
For a more detailed discussion on these critical accounting estimates, see “Summary of Critical Accounting Estimates” beginning on page 56 of the 2025 Form 10-K.
Net Income
Net income for the quarter ended March 31, 2026 totaled $227.4 million, an increase of $38.3 million, or 20%, compared to the quarter ended March 31, 2025. On a per share basis, net income for the first quarter of 2026 totaled $3.22 per diluted common share compared to $2.69 for the first quarter of 2025.
The increase in net income for the first quarter of 2026 as compared to the same period in the prior year is primarily attributable to increased net interest income and an increase in non-interest income, partially offset by increased non-interest expense primarily due to increased salary and employee benefits expenses. See “Net Interest Income,” “Non-interest Income,” “Non-interest Expense” and “Credit Quality” for further detail.
Net Interest Income
The primary source of the Company’s revenue is net interest income. Net interest income is the difference between interest income and fees on earning assets, such as loans and securities, and interest expense on the liabilities to fund those assets, including interest-bearing deposits and other borrowings. The amount of net interest income is affected by both changes in the level of interest rates, and the amount and composition of earning assets and interest bearing liabilities.
48
Table of Contents
Quarter Ended March 31, 2026 compared to the Quarters Ended December 31, 2025 and March 31, 2025
The following table presents a summary of the Company’s average balances, net interest income and related net interest margins, including a calculation on a fully taxable-equivalent basis, for the first quarter of 2026 as compared to the fourth quarter of 2025 (sequential quarters) and first quarter of 2025 (linked quarters):
| Average Balance for three months ended, | Interest for three months ended, | Yield/Rate for three months ended, | |||||||||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in thousands) | Mar 31, 2026 | Dec 31, 2025 | Mar 31, 2025 | Mar 31, 2026 | Dec 31, 2025 | Mar 31, 2025 | Mar 31, 2026 | Dec 31, 2025 | Mar 31, 2025 | ||||||||||||||||||||||||||||||||||||||||||||
Interest-bearing deposits with banks, securities purchased under resale agreements and cash equivalents (1) | $ | 2,247,083 | $ | 2,842,829 | $ | 3,520,048 | $ | 19,214 | $ | 27,267 | $ | 36,945 | 3.47 | % | 3.81 | % | 4.26 | % | |||||||||||||||||||||||||||||||||||
Investment securities (2) | 10,616,617 | 10,084,138 | 8,409,735 | 100,864 | 96,122 | 72,706 | 3.85 | 3.78 | 3.51 | ||||||||||||||||||||||||||||||||||||||||||||
| FHLB and FRB stock | 291,972 | 284,643 | 281,702 | 5,564 | 5,497 | 5,307 | 7.73 | 7.66 | 7.64 | ||||||||||||||||||||||||||||||||||||||||||||
Liquidity management assets (3) (8) | $ | 13,155,672 | $ | 13,211,610 | $ | 12,211,485 | $ | 125,642 | $ | 128,886 | $ | 114,958 | 3.87 | % | 3.87 | % | 3.82 | % | |||||||||||||||||||||||||||||||||||
Other earning assets (3) (4) (8) | — | — | 13,140 | — | — | 92 | — | — | 2.84 | ||||||||||||||||||||||||||||||||||||||||||||
| Mortgage loans held-for-sale | 317,047 | 357,672 | 286,710 | 4,615 | 5,607 | 4,246 | 5.90 | 6.22 | 6.01 | ||||||||||||||||||||||||||||||||||||||||||||
Loans, net of unearned income (3) (5) (8) | 52,845,685 | 52,193,637 | 47,833,380 | 799,915 | 824,628 | 770,568 | 6.14 | 6.27 | 6.53 | ||||||||||||||||||||||||||||||||||||||||||||
Total earning assets (8) | $ | 66,318,404 | $ | 65,762,919 | $ | 60,344,715 | $ | 930,172 | $ | 959,121 | $ | 889,864 | 5.69 | % | 5.79 | % | 5.98 | % | |||||||||||||||||||||||||||||||||||
| Allowance for loan and investment security losses | (391,810) | (404,075) | (375,371) | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Cash and due from banks | 534,189 | 517,616 | 476,423 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Other assets | 3,628,340 | 3,615,808 | 3,661,275 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total assets | $ | 70,089,123 | $ | 69,492,268 | $ | 64,107,042 | |||||||||||||||||||||||||||||||||||||||||||||||
| NOW and interest-bearing demand deposits | $ | 6,081,218 | $ | 6,133,333 | $ | 6,046,189 | $ | 29,666 | $ | 31,681 | $ | 33,600 | 1.98 | % | 2.05 | % | 2.25 | % | |||||||||||||||||||||||||||||||||||
| Wealth management deposits | 1,858,560 | 1,925,808 | 1,574,480 | 8,941 | 10,011 | 8,606 | 1.95 | 2.06 | 2.22 | ||||||||||||||||||||||||||||||||||||||||||||
| Money market accounts | 21,156,125 | 20,475,659 | 17,581,141 | 155,299 | 163,585 | 146,374 | 2.98 | 3.17 | 3.38 | ||||||||||||||||||||||||||||||||||||||||||||
| Savings accounts | 6,921,251 | 6,814,263 | 6,479,444 | 30,672 | 34,371 | 35,923 | 1.80 | 2.00 | 2.25 | ||||||||||||||||||||||||||||||||||||||||||||
| Time deposits | 9,782,112 | 10,045,136 | 9,406,126 | 84,609 | 92,530 | 95,730 | 3.51 | 3.65 | 4.13 | ||||||||||||||||||||||||||||||||||||||||||||
| Interest-bearing deposits | $ | 45,799,266 | $ | 45,394,199 | $ | 41,087,380 | $ | 309,187 | $ | 332,178 | $ | 320,233 | 2.74 | % | 2.90 | % | 3.16 | % | |||||||||||||||||||||||||||||||||||
| Federal Home Loan Bank advances | 3,451,312 | 3,203,483 | 3,151,309 | 27,701 | 26,408 | 25,441 | 3.26 | 3.27 | 3.27 | ||||||||||||||||||||||||||||||||||||||||||||
| Other borrowings | 442,200 | 547,507 | 582,139 | 4,026 | 5,956 | 6,792 | 3.69 | 4.32 | 4.73 | ||||||||||||||||||||||||||||||||||||||||||||
| Subordinated notes | 298,661 | 298,576 | 298,306 | 3,719 | 3,737 | 3,714 | 5.05 | 4.97 | 5.05 | ||||||||||||||||||||||||||||||||||||||||||||
| Junior subordinated debentures | 253,566 | 253,566 | 253,566 | 3,903 | 4,173 | 4,311 | 6.24 | 6.53 | 6.90 | ||||||||||||||||||||||||||||||||||||||||||||
Total interest-bearing liabilities | $ | 50,245,005 | $ | 49,697,331 | $ | 45,372,700 | $ | 348,536 | $ | 372,452 | $ | 360,491 | 2.81 | % | 2.97 | % | 3.22 | % | |||||||||||||||||||||||||||||||||||
| Non-interest-bearing deposits | 10,963,887 | 11,080,254 | 10,732,156 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Other liabilities | 1,492,518 | 1,548,075 | 1,541,245 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Equity | 7,387,713 | 7,166,608 | 6,460,941 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 70,089,123 | $ | 69,492,268 | $ | 64,107,042 | |||||||||||||||||||||||||||||||||||||||||||||||
Interest rate spread (6) (8) | 2.88 | % | 2.82 | % | 2.76 | % | |||||||||||||||||||||||||||||||||||||||||||||||
| Less: Fully taxable-equivalent adjustment | (2,612) | (2,795) | (2,899) | (0.02) | (0.02) | (0.02) | |||||||||||||||||||||||||||||||||||||||||||||||
Net free funds/contribution (7) | $ | 16,073,399 | $ | 16,065,588 | $ | 14,972,015 | 0.68 | 0.72 | 0.80 | ||||||||||||||||||||||||||||||||||||||||||||
Net interest income/margin (GAAP) (8) | $ | 579,024 | $ | 583,874 | $ | 526,474 | 3.54 | % | 3.52 | % | 3.54 | % | |||||||||||||||||||||||||||||||||||||||||
| Fully taxable-equivalent adjustment | 2,612 | 2,795 | 2,899 | 0.02 | 0.02 | 0.02 | |||||||||||||||||||||||||||||||||||||||||||||||
Net interest income/margin, fully taxable-equivalent (non-GAAP) (8) | $ | 581,636 | $ | 586,669 | $ | 529,373 | 3.56 | % | 3.54 | % | 3.56 | % | |||||||||||||||||||||||||||||||||||||||||
(1)Includes interest-bearing deposits with banks and securities purchased under resale agreements with original maturities of greater than three months. Cash equivalents include federal funds sold and securities purchased under resale agreements with original maturities of three months or less.
(2)Investment securities includes investment securities classified as available-for-sale and held-to-maturity, and equity securities with readily determinable fair values. Equity securities without readily determinable fair values are included within other assets.
(3)Interest income on tax-advantaged loans, trading securities and investment securities reflects a tax-equivalent adjustment based on the marginal federal corporate tax rate in effect as of the applicable period. The total adjustments for the three months ended March 31, 2026, December 31, 2025 and March 31, 2025 were $2.6 million, $2.8 million and $2.9 million, respectively.
(4)Other earning assets include brokerage customer receivables and trading account securities.
(5)Loans, net of unearned income, include nonaccrual loans.
(6)Interest rate spread is the difference between the yield earned on earning assets and the rate paid on interest-bearing liabilities.
(7)Net free funds are the difference between total average earning assets and total average interest-bearing liabilities. The estimated contribution to net interest margin from net free funds is calculated using the rate paid for total interest-bearing liabilities.
(8)See “Supplemental Non-GAAP Financial Measures/Ratios” for additional information on this performance measure/ratio.
49
Table of Contents
For the first quarter of 2026, net interest income totaled $579.0 million, a decrease of $4.9 million as compared to the fourth quarter of 2025, and an increase of $52.6 million as compared to the first quarter of 2025. Net interest margin was 3.54% (3.56% on a FTE basis, non-GAAP) during the first quarter of 2026 compared to 3.52% (3.54% on a FTE basis, non-GAAP) during the fourth quarter of 2025, and 3.54% (3.56% on a FTE basis, non-GAAP) during the first quarter of 2025.
Analysis of Changes in Net Interest Income on a FTE basis (non-GAAP)
The following table presents an analysis of the changes in the Company’s net interest income on a FTE basis (non-GAAP) comparing the three month period ended March 31, 2026 to each of the three month periods ended December 31, 2025 and March 31, 2025. The reconciliations set forth the changes in the net interest income on a FTE basis (non-GAAP) as a result of changes in volumes, changes in rates and differing number of days in each period:
First Quarter of 2026 Compared to Fourth Quarter of 2025 | First Quarter of 2026 Compared to First Quarter of 2025 | ||||||||||||||||
| (In thousands) | |||||||||||||||||
Net interest income, FTE basis (non-GAAP) (1) for comparative period | $ | 586,669 | $ | 529,373 | |||||||||||||
| Change due to mix and growth of earning assets and interest-bearing liabilities (volume) | 4,134 | 48,465 | |||||||||||||||
| Change due to interest rate fluctuations (rate) | 3,870 | 3,798 | |||||||||||||||
| Change due to number of days in each period | (13,037) | — | |||||||||||||||
| Less: FTE adjustment | (2,612) | (2,612) | |||||||||||||||
Net interest income (GAAP) (1) for the period ended March 31, 2026 | $ | 579,024 | $ | 579,024 | |||||||||||||
| FTE adjustment | 2,612 | 2,612 | |||||||||||||||
Net interest income, FTE basis (non-GAAP) (1) | $ | 581,636 | $ | 581,636 | |||||||||||||
(1) See “Supplemental Non-GAAP Financial Measures/Ratios” for additional information on this performance measure/ratio.
Deposit beta
The Company defines deposit betas as the change in the cost of the Company’s deposits relative to the change in the upper limit of the federal funds target range established by the Federal Open Market Committee. The Company evaluates deposit betas across both rising and declining interest rate environments. During the prior rising interest rate cycle, which began in the first quarter of 2022 and concluded in the second quarter of 2024, deposit costs increased as rates rose, resulting in cumulative deposit betas of 53% for total deposits and 66% for interest-bearing deposits. For the current declining interest rate cycle, measured from June 30, 2024 to March 31, 2026, our cumulative deposit betas were 41% for total deposits and 57% for interest-bearing deposits.
50
Table of Contents
Non-interest Income
The following table presents non-interest income by category for the periods presented:
| Three Months Ended | $ Change | % Change | |||||||||||||||||||||
| (Dollars in thousands) | March 31, 2026 | March 31, 2025 | |||||||||||||||||||||
| Brokerage | $ | 5,301 | $ | 4,757 | $ | 544 | 11 | % | |||||||||||||||
| Trust and asset management | 36,758 | 29,285 | 7,473 | 26 | |||||||||||||||||||
Total wealth management (1) | 42,059 | 34,042 | 8,017 | 24 | |||||||||||||||||||
| Mortgage banking | 23,396 | 20,529 | 2,867 | 14 | |||||||||||||||||||
| Service charges on deposit accounts | 20,970 | 19,362 | 1,608 | 8 | |||||||||||||||||||
| (Losses) gains on investment securities, net | (31) | 3,196 | (3,227) | NM | |||||||||||||||||||
| Fees from covered call options | 4,669 | 3,446 | 1,223 | 35 | |||||||||||||||||||
| Trading gains (losses), net | 10 | (64) | 74 | NM | |||||||||||||||||||
| Operating lease income, net | 19,154 | 15,287 | 3,867 | 25 | |||||||||||||||||||
| Other: | |||||||||||||||||||||||
| Interest rate swap fees | 4,041 | 2,269 | 1,772 | 78 | |||||||||||||||||||
| BOLI | 948 | 796 | 152 | 19 | |||||||||||||||||||
| Administrative services | 1,243 | 1,393 | (150) | (11) | |||||||||||||||||||
| Foreign currency remeasurement losses | (368) | (183) | (185) | NM | |||||||||||||||||||
| Changes in fair value on EBOs and loans held-for-investment | (287) | 383 | (670) | NM | |||||||||||||||||||
| Early pay-offs of capital leases | 1,198 | 768 | 430 | 56 | |||||||||||||||||||
| Miscellaneous | 17,140 | 15,410 | 1,730 | 11 | |||||||||||||||||||
| Total Other | 23,915 | 20,836 | 3,079 | 15 | |||||||||||||||||||
| Total Non-interest Income | $ | 134,142 | $ | 116,634 | $ | 17,508 | 15 | % | |||||||||||||||
(1)Wealth management revenue is comprised of the trust and asset management revenue of Wintrust Private Trust Company, N.A. (“WPT”) and Great Lakes Advisors, the brokerage commissions, managed money fees and insurance product commissions at Wintrust Investments and fees from tax-deferred like-kind exchange services provided by CDEC.
NM - Not Meaningful.
Notable contributions to the change in non-interest income are as follows:
Mortgage banking revenue increased for the three months ended March 31, 2026 as compared to the same period in 2025 due primarily to higher production revenue. Mortgage banking revenue includes revenue from activities related to originating, selling and servicing residential real estate loans for the secondary market. A main factor in the mortgage banking revenue recognized by the Company is the volume of mortgage loans originated or purchased for sale and the related production margins. Mortgage loans originated for sale totaled $594.0 million in the first quarter of 2026 as compared to $460.5 million in the first quarter of 2025. The increase in quarterly origination volume was driven primarily by a favorable rate environment and modest improvements in housing supply relative to the prior year. Mortgage rates in early 2026 remained below year-ago levels despite intra-quarter volatility, contributing to improved borrower demand and higher level of refinancing activity. The percentage of origination volume from refinancing activities was 48% for the three months ended March 31, 2026, as compared to 23% for the same period in 2025.
The Company records MSRs at fair value on a recurring basis. For the three months ended March 31, 2026, the fair value of the MSRs portfolio slightly increased by $253,000, reflecting $6.4 million of capitalization from newly retained servicing rights and a fair value adjustment of $460,000, largely offset by $6.6 million of reductions due to payoffs, paydowns and repurchases of the existing portfolio. See Note (9) “Mortgage Servicing Rights (“MSRs”)” to the Consolidated Financial Statements in Item 1 of this report for a summary of the changes in the carrying value of MSRs.
Mortgage banking revenue is also impacted by changes in the fair value of derivative contracts held to economically hedge a portion of the fair value adjustments related to the Company’s MSRs portfolio. The change in fair value of the derivative contracts held as an economic hedge was an unfavorable $900,000 for the three months ended March 31, 2026 compared to a favorable $4.9 million for the three months ended March 31, 2025.
Wealth management revenue increased by $8.0 million in the first quarter of 2026 as compared to the same period of 2025 primarily due to increased trust and asset management revenue. Wealth management revenue is comprised of the trust and asset management revenue of Wintrust Private Trust Company and Great Lakes Advisors, the brokerage commissions, managed
51
Table of Contents
money fees and insurance product commissions at Wintrust Investments and fees from tax-deferred like-kind exchange services provided by the Chicago Deferred Exchange Company.
Service charges on deposits increased for the three months ended March 31, 2026 as compared to the same period in 2025 primarily as a result of increased commercial account analysis service fees. Service charges on deposit accounts include fees charged to deposit customers for various services, including account analysis services, and are based on factors such as the size and type of customer, type of product and number of transactions. The fees are based on a standard schedule of fees and, depending on the nature of the service performed, the service is performed at a point in time or over a period of a month.
The Company recognized net losses on investment securities for the three months ended March 31, 2026 of $31,000. The Company recognized net gains on investment securities for the three months ended March 31, 2025 of $3.2 million. The net losses for the three months ended March 31, 2026 were primarily the result of unrealized losses on the Company’s equity investment securities with a readily determinable fair value. See Note (5) “Investment Securities” to the Consolidated Financial Statements in Item 1 of this report for more information on net gains and losses on investment securities.
Operating lease income increased in the first quarter of 2026 as a result of additional lease rental income due to growth in leased assets as compared to the first quarter of 2025.
Fees from covered call options for the three months ended March 31, 2026 increased $1.2 million, when compared to the same period in the prior year. The increased income was primarily because the Company sold more options than in the comparative period. The Company has routinely written call options with terms of less than three months against certain U.S. Treasury and agency securities held in its portfolio for liquidity and other purposes. Management has effectively entered into these transactions with the goal of economically hedging security positions and enhancing its overall return on its investment portfolio. These option transactions are designed to increase the total return associated with holding certain investment securities and do not qualify as hedges pursuant to accounting guidance. There were no outstanding call option contracts at March 31, 2026 and 2025.
Miscellaneous non-interest income includes loan servicing fees, income from other investments, and other fees. This category of income increased $1.7 million for the three months ended March 31, 2026 compared to the same period in 2025. For the three months ended March 31, 2026, miscellaneous income increased compared to the same period in 2025 primarily due to higher fees earned on card-related arrangements, letters of credit and syndication fees.
52
Table of Contents
The table below presents additional selected information regarding mortgage banking for the respective periods.
| Three Months Ended | ||||||||||||||||||||||||||||||||
| (Dollars in thousands) | March 31, 2026 | March 31, 2025 | ||||||||||||||||||||||||||||||
| Originations: | ||||||||||||||||||||||||||||||||
| Retail originations | $ | 441,749 | $ | 348,468 | ||||||||||||||||||||||||||||
| Veterans First originations | 152,244 | 111,985 | ||||||||||||||||||||||||||||||
| Total originations for sale (A) | $ | 593,993 | $ | 460,453 | ||||||||||||||||||||||||||||
| Originations for investment | 371,540 | 217,177 | ||||||||||||||||||||||||||||||
| Total originations | $ | 965,533 | $ | 677,630 | ||||||||||||||||||||||||||||
| As percentage of originations for sale: | ||||||||||||||||||||||||||||||||
| Retail originations | 74 | % | 76 | % | ||||||||||||||||||||||||||||
| Veterans First originations | 26 | 24 | ||||||||||||||||||||||||||||||
| Purchases | 52 | % | 77 | % | ||||||||||||||||||||||||||||
| Refinances | 48 | 23 | ||||||||||||||||||||||||||||||
| Production Margin: | ||||||||||||||||||||||||||||||||
Production revenue (B) (1) | $ | 13,028 | $ | 9,941 | ||||||||||||||||||||||||||||
| Total originations for sale (A) | $ | 593,993 | $ | 460,453 | ||||||||||||||||||||||||||||
Add: Current period end mandatory interest rate lock commitments to fund originations for sale (2) | 218,156 | 197,297 | ||||||||||||||||||||||||||||||
Less: Prior period end mandatory interest rate lock commitments to fund originations for sale (2) | 122,804 | 103,946 | ||||||||||||||||||||||||||||||
| Total mortgage production volume (C) | $ | 689,345 | $ | 553,804 | ||||||||||||||||||||||||||||
| Production margin (B/C) | 1.89 | % | 1.80 | % | ||||||||||||||||||||||||||||
| Mortgage Servicing: | ||||||||||||||||||||||||||||||||
| Loans serviced for others (D) | $ | 12,534,513 | $ | 12,402,352 | ||||||||||||||||||||||||||||
| MSRs, at fair value (E) | 195,276 | 196,307 | ||||||||||||||||||||||||||||||
| Percentage of MSRs to loans serviced for others (E/D) | 1.56 | % | 1.58 | % | ||||||||||||||||||||||||||||
| Servicing income | $ | 10,353 | $ | 10,611 | ||||||||||||||||||||||||||||
| MSR Fair Value Asset Activity | ||||||||||||||||||||||||||||||||
| MSR - FV at Beginning of Period | $ | 195,023 | $ | 203,788 | ||||||||||||||||||||||||||||
| MSR - current period capitalization | 6,434 | 4,669 | ||||||||||||||||||||||||||||||
| MSR - collection of expected cash flows - paydowns | (1,620) | (1,590) | ||||||||||||||||||||||||||||||
| MSR - collection of expected cash flows - payoffs and repurchases | (5,021) | (3,046) | ||||||||||||||||||||||||||||||
| MSR - changes in fair value model assumptions | 460 | (7,514) | ||||||||||||||||||||||||||||||
| MSR Fair Value at end of period | $ | 195,276 | $ | 196,307 | ||||||||||||||||||||||||||||
| Summary of Mortgage Banking Revenue | ||||||||||||||||||||||||||||||||
| Operational: | ||||||||||||||||||||||||||||||||
Production revenue (1) | $ | 13,028 | $ | 9,941 | ||||||||||||||||||||||||||||
| MSR - current period capitalization | 6,434 | 4,669 | ||||||||||||||||||||||||||||||
| MSR - collection of expected cash flows - paydowns | (1,620) | (1,590) | ||||||||||||||||||||||||||||||
| MSR - collection of expected cash flows - payoffs and repurchases | (5,021) | (3,046) | ||||||||||||||||||||||||||||||
| Servicing Income | 10,353 | 10,611 | ||||||||||||||||||||||||||||||
| Other Revenue | (45) | (172) | ||||||||||||||||||||||||||||||
| Total operational mortgage banking revenue | $ | 23,129 | $ | 20,413 | ||||||||||||||||||||||||||||
| Fair Value: | ||||||||||||||||||||||||||||||||
| MSR - changes in fair value model assumptions | $ | 460 | $ | (7,514) | ||||||||||||||||||||||||||||
| (Loss) gain on derivative contract held as an economic hedge, net | (900) | 4,897 | ||||||||||||||||||||||||||||||
| Changes in FV on early buy-out loans guaranteed by US Govt held-for-sale | 707 | 2,733 | ||||||||||||||||||||||||||||||
| Total fair value mortgage banking revenue | $ | 267 | $ | 116 | ||||||||||||||||||||||||||||
| Total mortgage banking revenue | $ | 23,396 | $ | 20,529 | ||||||||||||||||||||||||||||
(1)Production revenue represents revenue earned from the origination and subsequent sale of mortgages, including gains on loans sold and fees from originations, changes in other related financial instruments carried at fair value, processing and other related activities, and excludes servicing fees, changes in the fair value of servicing rights and changes to the mortgage recourse obligation and other non-production revenue.
(2)Certain volume adjusted for the estimated pull-through rate of the loan, which represents the Company’s best estimate of the likelihood that a committed loan will ultimately fund.
53
Table of Contents
Non-interest Expense
The following table presents non-interest expense by category for the periods presented:
| Three Months Ended | $ Change | % Change | |||||||||||||||||||||
| (Dollars in thousands) | March 31, 2026 | March 31, 2025 | |||||||||||||||||||||
| Salaries and employee benefits: | |||||||||||||||||||||||
| Salaries | $ | 129,086 | $ | 123,917 | $ | 5,169 | 4 | % | |||||||||||||||
| Commissions and incentive compensation | 57,407 | 52,536 | 4,871 | 9 | |||||||||||||||||||
| Benefits | 41,954 | 35,073 | 6,881 | 20 | |||||||||||||||||||
| Total salaries and employee benefits | 228,447 | 211,526 | 16,921 | 8 | |||||||||||||||||||
| Software and equipment | 35,654 | 34,717 | 937 | 3 | |||||||||||||||||||
| Operating lease equipment | 10,987 | 10,471 | 516 | 5 | |||||||||||||||||||
| Occupancy, net | 20,566 | 20,778 | (212) | (1) | |||||||||||||||||||
| Data processing | 11,266 | 11,274 | (8) | (0) | |||||||||||||||||||
| Advertising and marketing | 13,218 | 12,272 | 946 | 8 | |||||||||||||||||||
| Professional fees | 7,375 | 9,044 | (1,669) | (18) | |||||||||||||||||||
| Amortization of other acquisition-related intangible assets | 4,958 | 5,618 | (660) | (12) | |||||||||||||||||||
| FDIC insurance | 10,990 | 10,926 | 64 | 1 | |||||||||||||||||||
| OREO expense, net | 207 | 643 | (436) | (68) | |||||||||||||||||||
| Other: | |||||||||||||||||||||||
| Lending expenses, net of deferred originations costs | 6,510 | 5,866 | 644 | 11 | |||||||||||||||||||
| Travel and entertainment | 5,426 | 5,270 | 156 | 3 | |||||||||||||||||||
| Miscellaneous | 27,028 | 27,685 | (657) | (2) | |||||||||||||||||||
| Total other | 38,964 | 38,821 | 143 | 0 | |||||||||||||||||||
| Total Non-interest Expense | $ | 382,632 | $ | 366,090 | $ | 16,542 | 5 | % | |||||||||||||||
NM - Not meaningful.
Notable contributions to the change in non-interest expense are as follows:
Salaries and employee benefits expense increased for the three months ended March 31, 2026 as compared to the same period in 2025. The increase was primarily due to annual merit increases and higher health insurance costs.
Professional fees expense decreased for the three months ended March 31, 2026 as compared to the same period in 2025 primarily due to lower consulting fees. Professional fees include legal, audit, and tax fees, external loan review costs, consulting arrangements and normal regulatory exam assessments.
Software and equipment expense increased for the three months ended March 31, 2026 as compared to the same period in 2025 as a result of higher software license fees as well as higher computer and software depreciation expense as the Company invests in enhancements to the digital customer experience, upgrades to infrastructure and enhancements to information security capabilities. Software and equipment expense includes furniture, equipment and computer software, depreciation, and repairs and maintenance costs.
Miscellaneous non-interest expense includes ATM expenses, correspondent bank charges, directors’ fees, telephone, postage, corporate insurance, dues and subscriptions, problem loan expenses and other miscellaneous operational losses and costs.
Income Taxes
The Company recorded income tax expense of $73.6 million in the first quarter of 2026 compared to $64.0 million in the first quarter of 2025. The effective tax rates were 24.4% in the first quarter of 2026 compared to 25.3% in the first quarter of 2025. The effective tax rates were partially impacted by the tax effects related to share-based compensation which fluctuate based on the Company’s stock price and timing of employee stock option exercises and vesting of other shared-based awards. The Company recorded net excess tax benefits of $6.6 million in the first quarter of 2026, compared to net excess tax benefits of $3.7 million in the first quarter of 2025 related to share-based compensation.
54
Table of Contents
Operating Segment Results
The Company’s operations consist of three primary segments: community banking, specialty finance and wealth management. Refer to Note (13) “Segment Information” to the Consolidated Financial Statements in Item 1 of this report for further information on the Company’s primary segments. The Company’s profitability is primarily dependent on the net interest income, provision for credit losses, non-interest income and operating expenses of its community banking segment.
The community banking segment’s net interest income for the quarter ended March 31, 2026 totaled $450.6 million as compared to $419.0 million for the same period in 2025, an increase of $31.6 million, or 8%. The increase in the three month period was primarily attributable to growth in average earning assets coupled with a relatively stable net interest margin. The community banking segment’s non-interest income totaled $77.9 million in the first quarter of 2026, an increase of $4.4 million, or 6%, when compared to the first quarter of 2025 total of $73.5 million. The increase in the three month period was primarily the result of an increase in mortgage banking revenue offset by an increase in losses recognized on investment securities. The community banking segment recorded provision for credit losses of $27.3 million for the three months ended March 31, 2026, compared to $22.4 million for the same period in 2025. The increase in provision for credit losses for the three month period was primarily the result of uncertainty within the macroeconomic forecast related to Baa corporate credit spread coupled with loan growth and higher net charge-offs. Non-interest expenses increased by $9.0 million for the three months ended March 31, 2026 compared to the same period in 2025, primarily due to an increase in salaries, commissions, and incentive compensation. The community banking segment’s net income for the quarter ended March 31, 2026 totaled $150.5 million, an increase of $16.3 million as compared to net income in the first quarter of 2025 of $134.3 million.
The specialty finance segment’s net interest income totaled $107.1 million for the quarter ended March 31, 2026, compared to $91.3 million for the same period in 2025, an increase of $15.8 million, or 17%. The increase for the three month period was primarily due to loan growth. The specialty finance segment’s provision for credit losses totaled $2.3 million for the three months ended March 31, 2026 compared to $1.5 million for the same period in 2025. The increase in provision for credit losses for the three month period was primarily the result of slightly higher net charge-offs within premium finance receivables coupled with uncertainty within the macroeconomic forecast related to Baa corporate credit spread, which impacted lease financing. The specialty finance segment’s non-interest income increased to $35.7 million from $31.0 million for the three months ended March 31, 2026 and 2025, respectively. Non-interest expenses increased by $6.2 million for the three months ended March 31, 2026 compared to the same period in 2025, primarily because of annual employee compensation increases and discretionary bonuses. Our property and casualty insurance premium finance operations, life insurance finance operations, lease financing operations and other specialty finance operations accounted for 40%, 26%, 24% and 10%, respectively, of the net revenues of our specialty finance business for the three month period ended March 31, 2026. The net income of the specialty finance segment for the quarter ended March 31, 2026 totaled $63.1 million as compared to $50.3 million for the quarter ended March 31, 2025.
The wealth management segment reported net interest income of $10.3 million for the first quarter of 2026 compared to $5.4 million in the same quarter of 2025, an increase of $5.0 million. Net interest income for this segment is primarily comprised of an allocation of net interest income earned by the community banking segment on non-interest-bearing and interest-bearing wealth management customer account balances on deposit at the banks. Wealth management customer account balances on deposit at the banks averaged $1.9 billion and $1.6 billion in the first three months of 2026 and 2025, respectively. This segment recorded non-interest income of $43.3 million for the first quarter of 2026 compared to $33.8 million for the first quarter of 2025. The increase in the three month period was primarily due to higher trust and asset management revenue driven by an increase in asset valuations. On a quarter-to-date basis, non-interest expense remained relatively stable for the three month period ended March 31, 2026 compared to the same period in 2025. Distribution of wealth management services through each bank continues to be a focus of the Company. The Company is committed to growing the wealth management segment in order to better service its customers and create a more diversified revenue stream. The wealth management segment’s net income totaled $13.8 million for the first quarter of 2026 compared to $4.5 million for the first quarter of 2025.
Financial Condition
Total assets were $72.2 billion at March 31, 2026, representing an increase of $6.3 billion, or 10%, when compared to March 31, 2025 and an increase of approximately $1.0 billion, or 6% on an annualized basis, when compared to December 31, 2025. Total funding, which includes deposits, all notes and advances, including secured borrowings and the junior subordinated debentures, was $63.3 billion at March 31, 2026, $62.2 billion at December 31, 2025, and $57.8 billion at March 31, 2025. See Notes (5), (6), (10), (11) and (12) of the Consolidated Financial Statements presented under Item 1 of this report for additional period-end detail on the Company’s interest-earning assets and funding liabilities.
55
Table of Contents
Interest-Earning Assets
The following table sets forth, by category, the composition of average earning asset balances and the relative percentage of total average earning assets for the periods presented:
| Three Months Ended | |||||||||||||||||||||||||||||||||||
| March 31, 2026 | December 31, 2025 | March 31, 2025 | |||||||||||||||||||||||||||||||||
| (Dollars in thousands) | Balance | Percent | Balance | Percent | Balance | Percent | |||||||||||||||||||||||||||||
| Mortgage loans held-for-sale | $ | 317,047 | 1 | % | $ | 357,672 | 1 | % | $ | 286,710 | 1 | % | |||||||||||||||||||||||
| Loans, net of unearned income | |||||||||||||||||||||||||||||||||||
| Commercial | 16,867,384 | 25 | % | 16,498,233 | 25 | 15,363,740 | 25 | ||||||||||||||||||||||||||||
Commercial real estate | 14,063,359 | 21 | 13,823,140 | 21 | 12,931,000 | 21 | |||||||||||||||||||||||||||||
Home equity | 473,334 | 1 | 484,916 | 1 | 449,095 | 1 | |||||||||||||||||||||||||||||
Residential real estate | 4,287,724 | 6 | 4,140,238 | 6 | 3,542,189 | 6 | |||||||||||||||||||||||||||||
| Premium finance receivables—property & casualty | 7,946,434 | 12 | 8,196,606 | 12 | 7,192,332 | 12 | |||||||||||||||||||||||||||||
| Premium finance receivables—life insurance | 9,074,298 | 14 | 8,905,172 | 14 | 8,248,690 | 14 | |||||||||||||||||||||||||||||
Other loans | 133,152 | 0 | 145,332 | 0 | 106,334 | 0 | |||||||||||||||||||||||||||||
Total loans, net of unearned income (1) | $ | 52,845,685 | 79 | % | $ | 52,193,637 | 79 | % | $ | 47,833,380 | 79 | % | |||||||||||||||||||||||
Liquidity management assets (2) | 13,155,672 | 20 | 13,211,610 | 20 | 12,211,485 | 20 | |||||||||||||||||||||||||||||
Other earning assets (3) | — | 0 | — | 0 | 13,140 | 0 | |||||||||||||||||||||||||||||
| Total average earning assets | $ | 66,318,404 | 100 | % | $ | 65,762,919 | 100 | % | $ | 60,344,715 | 100 | % | |||||||||||||||||||||||
| Total average assets | $ | 70,089,123 | $ | 69,492,268 | $ | 64,107,042 | |||||||||||||||||||||||||||||
| Total average earning assets to total average assets | 95 | % | 95 | % | 94 | % | |||||||||||||||||||||||||||||
(1)Includes non-accrual loans.
(2)Liquidity management assets include investment securities, other securities, interest-earning deposits with banks, federal funds sold and securities purchased under resale agreements.
(3)Other earning assets include brokerage customer receivables and trading account securities.
Mortgage loans held-for-sale. Mortgage loans held-for-sale represents such loans awaiting subsequent sale in the secondary market with such sales eliminating the interest-rate risk associated with these loans, as they are predominantly long-term fixed rate loans, and provide a source of non-interest revenue. The decrease in the average balance for the first quarter of 2026 as compared to the sequential period is primarily due to lower mortgage originations for sale.
Loans, net of unearned income. Growth realized in the combined commercial and commercial real estate loan categories for the first quarter of 2026 as compared to the sequential and prior year periods is primarily attributable to increased business development efforts. The aggregate balances of these loan categories comprised 59% in the first quarter of 2026, 58% in the fourth quarter of 2025 and 59% of the average loan portfolio in the first quarter of 2025.
Residential real estate loans averaged $4.3 billion in the first quarter of 2026, and increased $745.5 million, or 21%, from the average balance of $3.5 billion in the same period of 2025. Additionally, compared to the quarter ended December 31, 2025, the average balance increased $147.5 million, or 14% on an annualized basis. Growth is due to the Company continuing to originate non-agency mortgages that are held-for-investment.
The increase in the premium finance receivables during the first quarter of 2026 compared to the first quarter of 2025 was the result of effective marketing and customer servicing. Approximately $5.1 billion of premium finance receivables were originated in the first quarter of 2026 compared to $4.8 billion during the same period of 2025. Premium finance receivables consist of a property and casualty portfolio and a life portfolio comprising approximately 47% and 53%, respectively, of the average total balance of premium finance receivables for the first quarter of 2026, and 47% and 53%, respectively, for the first quarter of 2025.
Other loans represent a wide variety of personal and consumer loans to individuals. Consumer loans generally have shorter terms and higher interest rates than mortgage loans but generally involve more credit risk due to the type and nature of the collateral.
56
Table of Contents
Liquidity management assets. Funds that are not utilized for loan originations are used to purchase investment securities and short term money market investments, to sell as federal funds and to maintain in interest bearing deposits with banks. The balances of these assets can fluctuate based on management’s ongoing effort to manage liquidity and for asset liability management purposes. The Company will continue to prudently evaluate and utilize liquidity sources as needed, including the management of availability with the FHLB and FRB and utilization of the revolving credit facility with unaffiliated banks.
Maturities and Sensitivities of Loans to Changes in Interest Rates
The following table classifies the loan portfolio at March 31, 2026 by date at which the loans reprice or mature, and the type of rate exposure:
| As of March 31, 2026 | One year or less | From one to five years | From five to fifteen years | After fifteen years | |||||||||||||||||||||||||
| (In thousands) | Total | ||||||||||||||||||||||||||||
| Commercial | |||||||||||||||||||||||||||||
| Fixed rate | $ | 521,142 | $ | 4,062,342 | $ | 2,182,827 | $ | 19,916 | $ | 6,786,227 | |||||||||||||||||||
| Variable rate | 10,975,702 | 1,292 | — | — | 10,976,994 | ||||||||||||||||||||||||
| Total commercial | $ | 11,496,844 | $ | 4,063,634 | $ | 2,182,827 | $ | 19,916 | $ | 17,763,221 | |||||||||||||||||||
| Commercial real estate | |||||||||||||||||||||||||||||
| Fixed rate | $ | 860,484 | $ | 2,648,718 | $ | 345,954 | $ | 71,217 | $ | 3,926,373 | |||||||||||||||||||
| Variable rate | 10,225,429 | 10,419 | 65 | — | 10,235,913 | ||||||||||||||||||||||||
| Total commercial real estate | $ | 11,085,913 | $ | 2,659,137 | $ | 346,019 | $ | 71,217 | $ | 14,162,286 | |||||||||||||||||||
| Home equity | |||||||||||||||||||||||||||||
| Fixed rate | $ | 9,160 | $ | 1,141 | $ | — | $ | 8 | $ | 10,309 | |||||||||||||||||||
| Variable rate | 460,955 | — | — | — | 460,955 | ||||||||||||||||||||||||
| Total home equity | $ | 470,115 | $ | 1,141 | $ | — | $ | 8 | $ | 471,264 | |||||||||||||||||||
| Residential real estate | |||||||||||||||||||||||||||||
| Fixed rate | $ | 20,050 | $ | 4,549 | $ | 68,021 | $ | 1,052,334 | $ | 1,144,954 | |||||||||||||||||||
| Variable rate | 126,191 | 776,281 | 2,417,740 | — | 3,320,212 | ||||||||||||||||||||||||
| Total residential real estate | $ | 146,241 | $ | 780,830 | $ | 2,485,761 | $ | 1,052,334 | $ | 4,465,166 | |||||||||||||||||||
| Premium finance receivables - property & casualty | |||||||||||||||||||||||||||||
| Fixed rate | $ | 7,762,445 | $ | 127,886 | $ | — | $ | — | $ | 7,890,331 | |||||||||||||||||||
| Variable rate | — | — | — | — | — | ||||||||||||||||||||||||
| Total premium finance receivables - property & casualty | $ | 7,762,445 | $ | 127,886 | $ | — | $ | — | $ | 7,890,331 | |||||||||||||||||||
| Premium finance receivables - life insurance | |||||||||||||||||||||||||||||
| Fixed rate | $ | 55,951 | $ | 88,566 | $ | — | $ | — | $ | 144,517 | |||||||||||||||||||
| Variable rate | 9,051,865 | — | — | — | 9,051,865 | ||||||||||||||||||||||||
| Total premium finance receivables - life insurance | $ | 9,107,816 | $ | 88,566 | $ | — | $ | — | $ | 9,196,382 | |||||||||||||||||||
| Consumer and other | |||||||||||||||||||||||||||||
| Fixed rate | $ | 29,654 | $ | 8,473 | $ | 857 | $ | 842 | $ | 39,826 | |||||||||||||||||||
| Variable rate | 82,816 | — | — | — | 82,816 | ||||||||||||||||||||||||
| Total consumer and other | $ | 112,470 | $ | 8,473 | $ | 857 | $ | 842 | $ | 122,642 | |||||||||||||||||||
| Total per category | |||||||||||||||||||||||||||||
| Fixed rate | $ | 9,258,886 | $ | 6,941,675 | $ | 2,597,659 | $ | 1,144,317 | $ | 19,942,537 | |||||||||||||||||||
| Variable rate | 30,922,958 | 787,992 | 2,417,805 | — | 34,128,755 | ||||||||||||||||||||||||
| Total loans, net of unearned income | $ | 40,181,844 | $ | 7,729,667 | $ | 5,015,464 | $ | 1,144,317 | $ | 54,071,292 | |||||||||||||||||||
Less: Existing cash flow hedging derivatives (1) | (5,900,000) | ||||||||||||||||||||||||||||
| Total loans repricing or maturing in one year or less, adjusted for cash flow hedging activity | $ | 34,281,844 | |||||||||||||||||||||||||||
| Variable Rate Loan Pricing by Index: | |||||||||||||||||||||||||||||
SOFR tenors (2) | $ | 22,224,818 | |||||||||||||||||||||||||||
12- month CMT (3) | 7,992,586 | ||||||||||||||||||||||||||||
| Prime | 3,011,508 | ||||||||||||||||||||||||||||
| Fed Funds | 625,005 | ||||||||||||||||||||||||||||
| Other U.S. Treasury tenors | 175,047 | ||||||||||||||||||||||||||||
| Other | 99,791 | ||||||||||||||||||||||||||||
| Total variable rate | $ | 34,128,755 | |||||||||||||||||||||||||||
(1)Excludes cash flow hedges with future effective starting dates and those that have matured as of March 31, 2026. The $5.90 billion of cash flow hedging derivatives includes receive fixed swaps, collars and floors of which $4.95 billion were impacting the cash flows of loans indexed to one-month SOFR as of March 31, 2026.
(2) SOFR - Secured Overnight Financing Rate.
(3) CMT - Constant Maturity Treasury Rate.
57
Table of Contents
CREDIT QUALITY
Commercial and Commercial Real Estate Loan Portfolios
Our commercial and commercial real estate loan portfolios are comprised primarily of lines of credit for working capital purposes and commercial real estate loans. The table below sets forth information regarding the types and amounts of our loans within these portfolios as of March 31, 2026 and 2025:
| As of March 31, 2026 | As of March 31, 2025 | ||||||||||||||||||||||||||||||||||||||||||||||
| Allowance | Allowance | ||||||||||||||||||||||||||||||||||||||||||||||
| % of | For Credit | % of | For Credit | ||||||||||||||||||||||||||||||||||||||||||||
| Total | Losses | Total | Losses | ||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in thousands) | Balance | Balance | Allocation | Balance | Balance | Allocation | |||||||||||||||||||||||||||||||||||||||||
| Commercial | $ | 17,763,221 | 55.6 | % | $ | 210,959 | $ | 15,931,326 | 55.2 | % | $ | 201,183 | |||||||||||||||||||||||||||||||||||
| Commercial Real Estate: | |||||||||||||||||||||||||||||||||||||||||||||||
| Construction and development | $ | 2,323,942 | 7.3 | % | $ | 74,092 | $ | 2,448,881 | 8.5 | % | $ | 71,388 | |||||||||||||||||||||||||||||||||||
| Non-construction | 11,838,344 | 37.1 | % | 150,778 | 10,466,020 | 36.3 | 138,622 | ||||||||||||||||||||||||||||||||||||||||
| Total commercial real estate | $ | 14,162,286 | 44.4 | % | $ | 224,870 | $ | 12,914,901 | 44.8 | % | $ | 210,010 | |||||||||||||||||||||||||||||||||||
| Total commercial and commercial real estate | $ | 31,925,507 | 100.0 | % | $ | 435,829 | $ | 28,846,227 | 100.0 | % | $ | 411,193 | |||||||||||||||||||||||||||||||||||
| Commercial real estate - primary collateral location by state: | |||||||||||||||||||||||||||||||||||||||||||||||
| Illinois | $ | 7,220,810 | 51.0 | % | $ | 6,911,417 | 53.5 | % | |||||||||||||||||||||||||||||||||||||||
| Wisconsin | 872,118 | 6.2 | 908,337 | 7.0 | |||||||||||||||||||||||||||||||||||||||||||
| Michigan | 865,943 | 6.1 | 893,828 | 6.9 | |||||||||||||||||||||||||||||||||||||||||||
| Total primary markets | $ | 8,958,871 | 63.3 | % | $ | 8,713,582 | 67.4 | % | |||||||||||||||||||||||||||||||||||||||
| Florida | 540,342 | 3.8 | 437,500 | 3.4 | |||||||||||||||||||||||||||||||||||||||||||
| Indiana | 513,564 | 3.6 | 440,278 | 3.4 | |||||||||||||||||||||||||||||||||||||||||||
| Texas | 385,490 | 2.7 | 306,709 | 2.4 | |||||||||||||||||||||||||||||||||||||||||||
| Georgia | 318,222 | 2.3 | 246,730 | 1.9 | |||||||||||||||||||||||||||||||||||||||||||
| California | 318,014 | 2.3 | 261,860 | 2.0 | |||||||||||||||||||||||||||||||||||||||||||
| Colorado | 311,650 | 2.2 | 250,564 | 1.9 | |||||||||||||||||||||||||||||||||||||||||||
| Arizona | 301,915 | 2.1 | 224,201 | 1.7 | |||||||||||||||||||||||||||||||||||||||||||
| Tennessee | 249,965 | 1.8 | 296,895 | 2.3 | |||||||||||||||||||||||||||||||||||||||||||
| North Carolina | 237,621 | 1.7 | 187,549 | 1.5 | |||||||||||||||||||||||||||||||||||||||||||
| Other | 2,026,632 | 14.2 | 1,549,033 | 12.1 | |||||||||||||||||||||||||||||||||||||||||||
| Total commercial real estate | $ | 14,162,286 | 100.0 | % | $ | 12,914,901 | 100.0 | % | |||||||||||||||||||||||||||||||||||||||
We make commercial loans for many purposes, including working capital lines, which are generally renewable annually and supported by business assets, personal guarantees and additional collateral. Such loans may vary in size based on customer need. As a result of growth and impacts related to uncertainty regarding future economic performance, the Company’s commercial loan portfolio allowance for credit losses increased to $211.0 million as of March 31, 2026 compared to $201.2 million as of March 31, 2025.
Our commercial real estate loans are generally secured by a first mortgage lien and assignment of rents on the property. Since most of our bank branches are located in the Chicago metropolitan area, southern Wisconsin and west Michigan, 63.3% of our commercial real estate loan portfolio is located in this region as of March 31, 2026. We have been able to effectively manage our total non-performing commercial real estate loans, aided by our credit management process. As of March 31, 2026, our allowance for credit losses related to this portfolio was $224.9 million compared to $210.0 million as of March 31, 2025. The increase in the allowance for credit losses is primarily a result of growth in the portfolio and impacts related to uncertainty regarding future economic performance. The table below sets forth the commercial real estate loans by property type and owner vs. non-owner occupied.
58
Table of Contents
| (In thousands) | March 31, 2026 | March 31, 2025 | ||||||||||||||||||||||||||||||||||||
| Commercial Real Estate: | Owner Occupied | Non-Owner Occupied | Total | % of Total | Average Size of Loan | Owner Occupied | Non-Owner Occupied | Total | % of Total | Average Size of Loan | ||||||||||||||||||||||||||||
| Residential construction | $ | 1,323 | $ | 51,774 | $ | 53,097 | 0 | % | $ | 487 | $ | 1,530 | $ | 54,319 | $ | 55,849 | 0 | % | $ | 458 | ||||||||||||||||||
| Commercial construction | 185,124 | 1,774,251 | 1,959,375 | 14 | 5,099 | 201,889 | 1,884,908 | 2,086,797 | 16 | 5,296 | ||||||||||||||||||||||||||||
| Land | 5,472 | 305,998 | 311,470 | 2 | 1,811 | 5,687 | 300,548 | 306,235 | 2 | 1,781 | ||||||||||||||||||||||||||||
| Office | 283,299 | 1,369,183 | 1,652,482 | 12 | 1,569 | 288,398 | 1,353,157 | 1,641,555 | 13 | 1,505 | ||||||||||||||||||||||||||||
| Industrial | 1,070,939 | 2,253,038 | 3,323,977 | 24 | 2,236 | 932,404 | 1,745,151 | 2,677,555 | 21 | 1,850 | ||||||||||||||||||||||||||||
| Retail | 346,735 | 1,122,923 | 1,469,658 | 10 | 1,280 | 343,206 | 1,059,631 | 1,402,837 | 11 | 1,207 | ||||||||||||||||||||||||||||
| Multi-family | 97,338 | 3,468,081 | 3,565,419 | 25 | 1,578 | 100,647 | 2,990,667 | 3,091,314 | 24 | 1,328 | ||||||||||||||||||||||||||||
| Mixed use and other | 628,158 | 1,198,650 | 1,826,808 | 13 | 1,314 | 592,843 | 1,059,916 | 1,652,759 | 13 | 1,198 | ||||||||||||||||||||||||||||
| Total commercial real estate | $ | 2,618,388 | $ | 11,543,898 | $ | 14,162,286 | 100 | % | $ | 1,769 | $ | 2,466,604 | $ | 10,448,297 | $ | 12,914,901 | 100 | % | $ | 1,595 | ||||||||||||||||||
The Company also participates in mortgage warehouse lending, which is included above within commercial, industrial and other, by providing interim funding to unaffiliated mortgage bankers to finance residential mortgages originated by such bankers for sale into the secondary market. The Company’s loans to the mortgage bankers are secured by the business assets of the mortgage companies as well as the specific mortgage loans funded by the Company, after they have been pre-approved for purchase by third party end lenders. The Company may also provide interim financing for packages of mortgage loans on a bulk basis in circumstances where the mortgage bankers desire to competitively bid on a number of mortgages for sale as a package in the secondary market.
Past Due Loans and Non-Performing Assets
Our ability to manage credit risk depends in large part on our ability to properly identify and manage problem loans. To do so, the Company operates a credit risk rating system under which our credit management personnel assigns a credit risk rating to each loan at the time of origination and review loans on a regular basis to determine each loan’s credit risk rating on a scale of 1 through 10 with higher scores indicating higher risk. Description of the Company’s credit risk rating structure used is included in Item 7 - Management’s Discussion and Analysis of Financial Condition and Results of Operations of the 2025 Form 10-K.
If based on current information and events, it is probable that the Company will be unable to collect all amounts due to it according to the contractual terms of the loan agreement, a loan is individually assessed for measuring the allowance for credit losses and, if necessary, a reserve is established. In determining the appropriate reserve for collateral-dependent loans, the Company considers the results of appraisals for the associated collateral.
59
Table of Contents
Non-performing Assets (1)
The following table sets forth the Company's non-performing assets performing under the contractual terms of the loan agreement as of the dates shown.
| (Dollars in thousands) | March 31, 2026 | December 31, 2025 | March 31, 2025 | |||||||||||||||||
| Loans past due greater than 90 days and still accruing: | ||||||||||||||||||||
| Commercial | $ | — | $ | — | $ | 46 | ||||||||||||||
| Commercial real estate | — | — | — | |||||||||||||||||
| Home equity | — | — | — | |||||||||||||||||
| Residential real estate | — | — | — | |||||||||||||||||
| Premium finance receivables—property and casualty | 15,823 | 19,115 | 18,081 | |||||||||||||||||
| Premium finance receivables—life insurance | — | — | 2,962 | |||||||||||||||||
| Consumer and other | 10 | 42 | 98 | |||||||||||||||||
| Total loans past due greater than 90 days and still accruing | 15,833 | 19,157 | 21,187 | |||||||||||||||||
| Nonaccrual loans: | ||||||||||||||||||||
| Commercial | 87,750 | 78,059 | 70,560 | |||||||||||||||||
| Commercial real estate | 16,757 | 25,147 | 26,187 | |||||||||||||||||
| Home equity | 1,142 | 1,221 | 2,070 | |||||||||||||||||
| Residential real estate | 27,360 | 32,862 | 22,522 | |||||||||||||||||
| Premium finance receivables—property and casualty | 33,891 | 29,354 | 29,846 | |||||||||||||||||
| Premium finance receivables—life insurance | — | — | — | |||||||||||||||||
| Consumer and other | 16 | 8 | 18 | |||||||||||||||||
| Total nonaccrual loans | 166,916 | 166,651 | 151,203 | |||||||||||||||||
| Total non-performing loans: | ||||||||||||||||||||
| Commercial | 87,750 | 78,059 | 70,606 | |||||||||||||||||
| Commercial real estate | 16,757 | 25,147 | 26,187 | |||||||||||||||||
| Home equity | 1,142 | 1,221 | 2,070 | |||||||||||||||||
| Residential real estate | 27,360 | 32,862 | 22,522 | |||||||||||||||||
| Premium finance receivables—property and casualty | 49,714 | 48,469 | 47,927 | |||||||||||||||||
| Premium finance receivables—life insurance | — | — | 2,962 | |||||||||||||||||
| Consumer and other | 26 | 50 | 116 | |||||||||||||||||
| Total non-performing loans | $ | 182,749 | $ | 185,808 | $ | 172,390 | ||||||||||||||
| Other real estate owned | 17,439 | 20,839 | 22,625 | |||||||||||||||||
| Total non-performing assets | $ | 200,188 | $ | 206,647 | $ | 195,015 | ||||||||||||||
| Total non-performing loans by category as a percent of its own respective category’s period-end balance: | ||||||||||||||||||||
| Commercial | 0.49 | % | 0.46 | % | 0.44 | % | ||||||||||||||
| Commercial real estate | 0.12 | 0.18 | 0.20 | |||||||||||||||||
| Home equity | 0.24 | 0.25 | 0.45 | |||||||||||||||||
| Residential real estate | 0.61 | 0.76 | 0.61 | |||||||||||||||||
| Premium finance receivables—property and casualty | 0.63 | 0.59 | 0.66 | |||||||||||||||||
| Premium finance receivables—life insurance | — | — | 0.04 | |||||||||||||||||
| Consumer and other | 0.02 | 0.04 | 0.10 | |||||||||||||||||
| Total non-performing loans | 0.34 | % | 0.35 | % | 0.35 | % | ||||||||||||||
| Total non-performing assets, as a percentage of total assets | 0.28 | % | 0.29 | % | 0.30 | % | ||||||||||||||
| Total nonaccrual loans as a percentage of total loans | 0.31 | % | 0.31 | % | 0.31 | % | ||||||||||||||
| Allowance for credit losses as a percentage of nonaccrual loans | 282.38 | % | 276.15 | % | 296.25 | % | ||||||||||||||
(1)Excludes early buy-out loans guaranteed by U.S. government agencies. Early buy-out loans are insured or guaranteed by the FHA or the U.S. Department of Veterans Affairs, subject to indemnifications and insurance limits for certain loans.
At this time, management believes reserves are appropriate to absorb losses that are expected upon the ultimate resolution of these credits. Significant increases may occur in subsequent periods due to ongoing macroeconomic uncertainty and related impacts on borrowers. Management will continue to actively review and monitor its loan portfolios, in an effort to identify problem credits in a timely manner.
Loan Portfolio Aging
As of March 31, 2026, excluding early buy-out loans guaranteed by U.S. government agencies, $66.7 million, or 0.1% of all loans, were 60 to 89 days (or two payments) past due and $284.3 million, or 0.5% of all loans, were 30 to 59 days (or one payment) past due. As of December 31, 2025, excluding early buy-out loans guaranteed by U.S. government agencies, $94.8 million, or 0.2% of all loans, were 60 to 89 days (or two payments) past due and $264.7 million, or 0.5% of all loans, were 30 to 59 days (or one payment) past due. Many of the commercial and commercial real estate loans shown as 60 to 89 days and 30
60
Table of Contents
to 59 days past due are included on the Company’s internal problem loan reporting system. Loans on this system are closely monitored by management on a monthly basis. The Company's home equity and residential loan portfolios continue to exhibit low delinquency ratios. Home equity loans at March 31, 2026 that were current with regard to the contractual terms of the loan agreement represent 99.2% of the total home equity portfolio. Residential real estate loans, excluding early buy-out loans guaranteed by U.S. government agencies, at March 31, 2026 that were current with regards to the contractual terms of the loan agreements comprise 98.6% of total residential real estate loans outstanding. For more information regarding delinquent loans as of March 31, 2026, see Note (7) “Allowance for Credit Losses” in Item 1 of this report.
Non-performing Loans Rollforward, excluding early buy-out loans guaranteed by U.S. government agencies
The table below presents a summary of non-performing loans for the periods presented:
| Three Months Ended | |||||||||||||||||||||||
| March 31, | March 31, | ||||||||||||||||||||||
| (In thousands) | 2026 | 2025 | |||||||||||||||||||||
| Balance at beginning of period | $ | 185,808 | $ | 170,823 | |||||||||||||||||||
| Additions from becoming non-performing in the respective period | 24,969 | 27,721 | |||||||||||||||||||||
| Return to performing status | (3,663) | (1,207) | |||||||||||||||||||||
| Payments received | (13,780) | (15,965) | |||||||||||||||||||||
| Transfer to OREO or other assets | (868) | — | |||||||||||||||||||||
| Charge-offs | (10,930) | (8,600) | |||||||||||||||||||||
| Net change for premium finance receivables | 1,213 | (382) | |||||||||||||||||||||
| Balance at end of period | $ | 182,749 | $ | 172,390 | |||||||||||||||||||
Allowance for Credit Losses
The allowance for credit losses, specifically the allowance for loans losses and the allowance for unfunded commitment losses, represents management’s estimate of lifetime expected credit losses in the loan portfolio. The allowance for credit losses is determined quarterly using a methodology that incorporates important risk characteristics of each loan. A description of how the Company determines the allowance for credit losses is included in Item 7 - Management’s Discussion and Analysis of Financial Condition and Results of Operations of the 2025 Form 10-K.
Management determined that the allowance for credit losses was appropriate at March 31, 2026, and that the loan portfolio is well diversified and well secured, without undue concentration in any specific risk area. While this process involves a high degree of management judgment, the allowance for credit losses is based on a comprehensive, well documented, and consistently applied analysis of the Company’s loan portfolio. This analysis takes into consideration all available information existing as of the financial statement date, including environmental factors such as economic, industry, geographical and political factors, when considered applicable. The relative level of allowance for credit losses is reviewed and compared to industry peers. This review encompasses levels of total non-performing loans, portfolio mix, portfolio concentrations and overall levels of net charge-off. Historical trending of both the Company’s results and the industry peers is also reviewed to analyze comparative significance.
61
Table of Contents
Allowance for Credit Losses
The following table summarizes the activity in our allowance for credit losses, specifically related to loans and unfunded lending-related commitments, during the periods indicated.
| Three Months Ended | |||||||||||||||||||||||
| (Dollars in thousands) | March 31, 2026 | March 31, 2025 | |||||||||||||||||||||
| Allowance for credit losses at beginning of period | $ | 460,205 | $ | 436,603 | |||||||||||||||||||
| Provision for credit losses - other | 29,597 | 23,974 | |||||||||||||||||||||
| Other adjustments | (50) | 4 | |||||||||||||||||||||
| Charge-offs: | |||||||||||||||||||||||
| Commercial | 8,428 | 9,722 | |||||||||||||||||||||
| Commercial real estate | 7,260 | 454 | |||||||||||||||||||||
| Home equity | — | — | |||||||||||||||||||||
| Residential real estate | 350 | — | |||||||||||||||||||||
| Premium finance receivables - property & casualty | 7,431 | 7,114 | |||||||||||||||||||||
| Premium finance receivables - life insurance | — | 12 | |||||||||||||||||||||
| Consumer and other | 180 | 147 | |||||||||||||||||||||
| Total charge-offs | 23,649 | 17,449 | |||||||||||||||||||||
| Recoveries: | |||||||||||||||||||||||
| Commercial | 1,419 | 929 | |||||||||||||||||||||
| Commercial real estate | 6 | 12 | |||||||||||||||||||||
| Home equity | 303 | 216 | |||||||||||||||||||||
| Residential real estate | 1 | 136 | |||||||||||||||||||||
| Premium finance receivables - property & casualty | 3,437 | 3,487 | |||||||||||||||||||||
| Premium finance receivables - life insurance | — | — | |||||||||||||||||||||
| Consumer and other | 65 | 29 | |||||||||||||||||||||
| Total recoveries | 5,231 | 4,809 | |||||||||||||||||||||
| Net charge-offs | (18,418) | (12,640) | |||||||||||||||||||||
| Allowance for credit losses at period end | $ | 471,334 | $ | 447,941 | |||||||||||||||||||
| Annualized net charge-offs (recoveries) by category as a percentage of its own respective category’s average: | |||||||||||||||||||||||
| Commercial | 0.17 | % | 0.23 | % | |||||||||||||||||||
| Commercial real estate | 0.21 | 0.01 | |||||||||||||||||||||
| Home equity | (0.26) | (0.20) | |||||||||||||||||||||
| Residential real estate | 0.03 | (0.02) | |||||||||||||||||||||
| Premium finance receivables - property & casualty | 0.20 | 0.20 | |||||||||||||||||||||
| Premium finance receivables - life insurance | — | 0.00 | |||||||||||||||||||||
| Consumer and other | 0.35 | 0.45 | |||||||||||||||||||||
| Total loans, net of unearned income | 0.14 | % | 0.11 | % | |||||||||||||||||||
| Loans at period-end | $ | 54,071,292 | $ | 48,708,390 | |||||||||||||||||||
| Allowance for loan losses as a percentage of loans at period end | 0.72 | % | 0.78 | % | |||||||||||||||||||
| Allowance for loan and unfunded loan-related commitment losses as a percentage of loans at period end | 0.87 | 0.92 | |||||||||||||||||||||
See Note (7) “Allowance for Credit Losses” of the Consolidated Financial Statements presented under Item 1 of this report for further discussion of activity within the allowance for credit losses during the period and the relationship with respective loan balances for each loan category and the total loan portfolio.
62
Table of Contents
Other Real Estate Owned
In certain circumstances, the Company is required to take action against the real estate collateral of specific loans. The Company uses foreclosure only as a last resort for dealing with borrowers experiencing financial hardships. The Company employs extensive contact and restructuring procedures to attempt to find other solutions for our borrowers. The tables below present a summary of other real estate owned and show the activity for the respective periods and the balance for each property type:
| Three Months Ended | ||||||||||||||||||||||||||
| (In thousands) | March 31, 2026 | March 31, 2025 | ||||||||||||||||||||||||
| Balance at beginning of period | $ | 20,839 | $ | 23,116 | ||||||||||||||||||||||
| Disposal/resolved | (4,760) | — | ||||||||||||||||||||||||
| Transfers in at fair value, less costs to sell | 1,360 | — | ||||||||||||||||||||||||
| Fair value adjustments | — | (491) | ||||||||||||||||||||||||
| Balance at end of period | $ | 17,439 | $ | 22,625 | ||||||||||||||||||||||
| Period End | |||||||||||||||||
| (In thousands) | March 31, 2026 | December 31, 2025 | March 31, 2025 | ||||||||||||||
| Residential real estate | $ | — | $ | — | $ | — | |||||||||||
| Commercial real estate | 17,439 | 20,839 | 22,625 | ||||||||||||||
| Total | $ | 17,439 | $ | 20,839 | $ | 22,625 | |||||||||||
Deposits
Total deposits at March 31, 2026 were $58.9 billion, an increase of $5.3 billion, or 10%, compared to total deposits at March 31, 2025. See Note (10) “Deposits” to the Consolidated Financial Statements in Item 1 of this report for a summary of period end deposit balances.
The following table sets forth, by category, the maturity of time certificates of deposit as of March 31, 2026:
Time Certificates of Deposit Maturity/Re-pricing Analysis As of March 31, 2026 (Dollars in thousands) | Total Time Certificates of Deposits | Weighted-Average Rate of Maturing Time Certificates of Deposit | ||||||||||||||||||||||||||||||||||||
| 1-3 months | $ | 2,650,966 | 3.45 | % | ||||||||||||||||||||||||||||||||||
| 4-6 months | 5,018,880 | 3.51 | ||||||||||||||||||||||||||||||||||||
| 7-9 months | 1,589,764 | 3.37 | ||||||||||||||||||||||||||||||||||||
| 10-12 months | 822,123 | 3.40 | ||||||||||||||||||||||||||||||||||||
| 13-18 months | 243,686 | 2.88 | ||||||||||||||||||||||||||||||||||||
| 19-24 months | 70,182 | 2.85 | ||||||||||||||||||||||||||||||||||||
| 24+ months | 91,180 | 2.72 | ||||||||||||||||||||||||||||||||||||
| Total | $ | 10,486,781 | 3.44 | % | ||||||||||||||||||||||||||||||||||
63
Table of Contents
The following table sets forth, by category, the composition of average deposit balances and the relative percentage of total average deposits for the periods presented:
| Three Months Ended | |||||||||||||||||||||||||||||||||||
| March 31, 2026 | December 31, 2025 | March 31, 2025 | |||||||||||||||||||||||||||||||||
| (Dollars in thousands) | Balance | Percent | Balance | Percent | Balance | Percent | |||||||||||||||||||||||||||||
| Non-interest-bearing | $ | 10,963,887 | 20 | % | $ | 11,080,254 | 20 | % | $ | 10,732,156 | 21 | % | |||||||||||||||||||||||
| NOW and interest-bearing demand deposits | 6,081,218 | 11 | 6,133,333 | 11 | 6,046,189 | 11 | |||||||||||||||||||||||||||||
| Wealth management deposits | 1,858,560 | 3 | 1,925,808 | 3 | 1,574,480 | 3 | |||||||||||||||||||||||||||||
| Money market | 21,156,125 | 37 | 20,475,659 | 36 | 17,581,141 | 34 | |||||||||||||||||||||||||||||
| Savings | 6,921,251 | 12 | 6,814,263 | 12 | 6,479,444 | 13 | |||||||||||||||||||||||||||||
| Time certificates of deposit | 9,782,112 | 17 | 10,045,136 | 18 | 9,406,126 | 18 | |||||||||||||||||||||||||||||
| Total average deposits | $ | 56,763,153 | 100 | % | $ | 56,474,453 | 100 | % | $ | 51,819,536 | 100 | % | |||||||||||||||||||||||
Total average deposits for the first quarter of 2026 were $56.8 billion, an increase of $4.9 billion, or 10%, from the first quarter of 2025. Total deposits increased in the first quarter of 2026 as compared to the first quarter of 2025 primarily as a result of the Company’s increased marketing efforts to retain and attract deposits to support continued loan growth.
Wealth management deposits are funds from the brokerage customers of Wintrust Investments, CDEC and trust and asset management customers of the Company which have been placed into deposit accounts of the banks (“wealth management deposits” in the table above). Wealth Management deposits consist primarily of money market accounts. Consistent with reasonable interest rate risk parameters, these funds have generally been invested in loan production of the banks as well as other investments suitable for banks.
Brokered Deposits
While the Company obtains a portion of its total deposits through brokered deposits, the Company does so primarily as an asset-liability management tool to assist in the management of interest rate risk, and the Company does not consider brokered deposits to be a vital component of its current liquidity resources. Historically, brokered deposits have represented a small component of the Company’s total deposits outstanding, as set forth in the table below:
| March 31, | December 31, | ||||||||||||||||||||||||||||
| (Dollars in thousands) | 2026 | 2025 | 2025 | 2024 | 2023 | ||||||||||||||||||||||||
| Total deposits | $ | 58,914,382 | $ | 53,570,038 | $ | 57,717,191 | $ | 52,512,349 | $ | 45,397,170 | |||||||||||||||||||
Brokered deposits (1) | 4,322,797 | 4,214,776 | 4,123,822 | 3,598,102 | 4,216,718 | ||||||||||||||||||||||||
Brokered deposits as a percentage of total deposits (1) | 7.3 | % | 7.9 | % | 7.1 | % | 6.9 | % | 9.3 | % | |||||||||||||||||||
(1)Brokered deposits include certificates of deposit obtained through deposit brokers, deposits received through the Certificate of Deposit Account Registry Program, as well as wealth management deposits of brokerage customers from unaffiliated companies which have been placed into deposit accounts of the banks.
Other Funding Sources
Although deposits are the Company’s primary source of funding its interest-earning assets, the Company’s ability to manage the types and terms of deposits is somewhat limited by customer preferences and market competition. As a result, in addition to deposits and the issuance of equity securities and the retention of earnings, the Company uses several other funding sources to support its growth. These sources include FHLB advances, notes payable, short-term borrowings, secured borrowings, subordinated debt and junior subordinated debentures. The Company evaluates the terms and unique characteristics of each source, as well as its asset-liability management position, in determining the use of such funding sources.
64
Table of Contents
The following table sets forth, by category, the composition of the average balances of other funding sources for the quarterly periods presented:
| Three Months Ended | |||||||||||||||||
| March 31, | December 31, | March 31, | |||||||||||||||
| (In thousands) | 2026 | 2025 | 2025 | ||||||||||||||
| FHLB advances | $ | 3,451,312 | $ | 3,203,483 | $ | 3,151,309 | |||||||||||
| Other borrowings: | |||||||||||||||||
Notes payable | — | 101,581 | 142,686 | ||||||||||||||
| Short-term borrowings | 22 | 44 | 23 | ||||||||||||||
| Secured borrowings | 392,037 | 389,942 | 382,668 | ||||||||||||||
| Other | 50,141 | 55,940 | 56,762 | ||||||||||||||
| Total other borrowings | $ | 442,200 | $ | 547,507 | $ | 582,139 | |||||||||||
| Subordinated notes | 298,661 | 298,576 | 298,306 | ||||||||||||||
| Junior subordinated debentures | 253,566 | 253,566 | 253,566 | ||||||||||||||
| Total other funding sources | $ | 4,445,739 | $ | 4,303,132 | $ | 4,285,320 | |||||||||||
See Note (11) “FHLB Advances, Other Borrowings and Subordinated Notes” and Note (12) “Junior Subordinated Debentures” of the Consolidated Financial Statements presented under Item 1 of this report for details of period end balances and other information for these various funding sources. The Company hereby incorporates by reference Note (11) and Note (12) of the Consolidated Financial Statements presented under Item 1 of this report in its entirety.
Shareholders’ Equity
The following tables reflect various consolidated measures of capital as of the dates presented and the capital guidelines established for a bank holding company:
| March 31, 2026 | December 31, 2025 | March 31, 2025 | |||||||||||||||
| Tier 1 Leverage Ratio | 9.8 | % | 9.6 | % | 9.6 | % | |||||||||||
| Risk-based capital ratios: | |||||||||||||||||
| Tier 1 Capital Ratio | 11.1 | 11.0 | 10.8 | ||||||||||||||
| Common Equity Tier 1 Capital Ratio | 10.4 | 10.3 | 10.1 | ||||||||||||||
| Total Capital Ratio | 12.6 | 12.4 | 12.5 | ||||||||||||||
| Other ratio: | |||||||||||||||||
Total average equity-to-total average assets (1) | 10.5 | 10.3 | 10.1 | ||||||||||||||
(1)Based on quarterly average balances.
| Minimum Capital Requirements | Minimum Ratio + Capital Conservation Buffer (1) | Minimum Well Capitalized (2) | |||||||||||||||
| Tier 1 Leverage Ratio | 4.0 | % | N/A | N/A | |||||||||||||
| Risk-based capital ratios: | |||||||||||||||||
| Tier 1 Capital Ratio | 6.0 | 8.5 | 6.0 | ||||||||||||||
| Common Equity Tier 1 Capital Ratio | 4.5 | 7.0 | N/A | ||||||||||||||
| Total Capital Ratio | 8.0 | 10.5 | 10.0 | ||||||||||||||
(1)Reflects the Capital Conservation Buffer of 2.5%.
(2)Reflects the well-capitalized standard applicable to the Company for purposes of the Federal Reserve’s Regulation Y. The Federal Reserve has not yet revised the well-capitalized standard for bank holding companies to reflect the higher capital requirements imposed under the U.S. Basel III Rule or to add Common Equity Tier 1 Capital Ratio and Tier 1 Leverage Ratio requirements to this standard. As a result, the Common Equity Tier 1 Capital Ratio and Tier 1 Leverage Ratio are denoted as “N/A” in this column. If the Federal Reserve were to apply the same or a very similar well-capitalized standard to bank holding companies as the standard applicable to our subsidiary banks, we believe the Company’s capital ratios as of March 31, 2026 would exceed such revised well-capitalized standard.
65
Table of Contents
The Company’s principal sources of funds at the holding company level are dividends from its subsidiaries, borrowings under its loan agreement with unaffiliated banks and proceeds from the issuances of subordinated debt and additional equity. Refer to Notes (11) and (12) of the Consolidated Financial Statements in Item 1 for further information on these various funding sources. See Note (23) “Shareholders’ Equity” of the Consolidated Financial Statements presented under Item 7 of the 2025 Form 10-K for details on the Company’s issuance of Series F Preferred Stock and associated Depositary Shares in May 2025 and redemption of the Company’s Series D Preferred Stock and Series E Preferred Stock in July 2025.
The Board of Directors approves dividends from time to time, however, the ability to declare a dividend is limited by the Company’s financial condition, the terms of the Company’s Preferred Stock, the terms of the Company’s Trust Preferred Securities offerings and under certain financial covenants in the Company’s credit facilities. In January of 2026, the Company declared a quarterly cash dividend of $0.55 per common share. In January, April, July and October of 2025, the Company declared a quarterly cash dividend of $0.50 per common share.
At the April 2026 meeting of the Board of Directors, a quarterly cash dividend of $0.55 per common share ($2.20 on an annualized basis) was declared. It is payable on May 28, 2026 to shareholders of record as of May 14, 2026.
The Company continues to leverage its capital management framework to assess and monitor risk when making capital decisions. Management is committed to maintaining the Company’s capital levels above the “Well Capitalized” levels established by the FRB for bank holding companies.
LIQUIDITY
The Company manages the liquidity position of its banking operations to ensure that sufficient funds are available to meet customers’ needs for loans and deposit withdrawals. The management process includes the utilization of stress testing processes and other aspects of the Company's liquidity management framework to assess and monitor risk, and inform decision making. The liquidity to meet the demands of customers is provided by maturing assets, liquid assets that can be converted to cash and the ability to attract funds from external sources. Liquid assets refer to money market assets such as Federal funds sold and interest-bearing deposits with banks, as well as available-for-sale debt securities and equity securities with readily determinable fair values which are not pledged to secure public funds. In addition, trade date receivables represent certain sales or calls of available-for-sale securities that await cash settlement, typically in the month following the trade date.
We maintain our liquid assets to ensure that we would have the balance sheet strength to serve our clients. As a result, the Company believes that it has sufficient funds and access to funds to effectively meet its working capital and other needs. The Company will continue to prudently evaluate liquidity sources, including the management of availability with the FHLB and FRB and utilization of the revolving credit facility with unaffiliated banks. Please refer to Management’s Discussion and Analysis of Financial Condition and Results of Operation -Interest-Earning Assets, -Deposits, -Other Funding Sources and -Shareholders’ Equity sections of this report for additional information regarding the Company’s liquidity position.
INFLATION
A banking organization’s assets and liabilities are primarily monetary. Changes in the rate of inflation typically do not have as great an impact on the financial condition of a bank as do changes in interest rates. Moreover, interest rates do not necessarily change at the same percentage as inflation. Accordingly, changes in inflation are not expected to have as material an impact on the Company’s business as entities operating in other industries. An analysis of the Company’s asset and liability structure provides the best indication of how the organization is positioned to respond to changing interest rates. See “Quantitative and Qualitative Disclosures About Market Risk” section of this report for additional information.
FORWARD-LOOKING STATEMENTS
This document contains forward-looking statements within the meaning of federal securities laws. Forward-looking information can be identified through the use of words such as “intend,” “plan,” “project,” “expect,” “anticipate,” “believe,” “estimate,” “contemplate,” “possible,” “will,” “may,” “should,” “would” and “could.” Forward-looking statements and information are not historical facts, are premised on many factors and assumptions, and represent only management’s expectations, estimates and projections regarding future events. Similarly, these statements are not guarantees of future performance and involve certain risks and uncertainties that are difficult to predict, and which may include, but are not limited to, those listed below and the Risk Factors discussed under Item 1A of the Company’s 2025 Annual Report on Form 10-K and in any of the Company’s subsequent Securities and Exchange Commission filings. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and is including this statement for purposes of invoking these safe harbor provisions. Such forward-looking statements may be
66
Table of Contents
deemed to include, among other things, statements relating to the Company’s future financial performance, the performance of its loan portfolio, the expected amount of future credit reserves and charge-offs, delinquency trends, growth plans, regulatory developments, securities that the Company may offer from time to time, and management’s long-term performance goals, as well as statements relating to the anticipated effects on the Company’s financial condition and results of operations from expected developments or events, the Company’s business and growth strategies, including future acquisitions of banks, specialty finance or wealth management businesses, internal growth and plans to form additional de novo banks or branch offices. Actual results could differ materially from those addressed in the forward-looking statements as a result of numerous factors and uncertainties, including the following:
•economic conditions and events that affect the economy, housing prices, the job market and other factors that may adversely affect the Company’s liquidity and the performance of its loan portfolios, including an actual or threatened U.S. government shutdown, debt default or rating downgrade, particularly in the markets in which it operates;
•negative effects suffered by us or our customers resulting from changes in U.S. or international trade policies;
•the extent of defaults and losses on the Company’s loan portfolio, which may require further increases in its allowance for credit losses;
•estimates of fair value of certain of the Company’s assets and liabilities, which could change in value significantly from period to period;
•the financial success and economic viability of the borrowers of our commercial loans;
•commercial real estate market conditions in the Chicago metropolitan area, southern Wisconsin and west Michigan;
•the extent of commercial and consumer delinquencies and declines in real estate values, which may require further increases in the Company’s allowance for credit losses;
•inaccurate assumptions in our analytical and forecasting models used to manage our loan portfolio;
•changes in the level and volatility of interest rates, the capital markets and other market indices that may affect, among other things, the Company’s liquidity and the value of its assets and liabilities;
•the interest rate environment, including a prolonged period of low interest rates or rising interest rates, either broadly or for some types of instruments, which may affect the Company’s net interest income and net interest margin, and which could materially adversely affect the Company’s profitability;
•competitive pressures in the financial services business which may affect the pricing of the Company’s loan and deposit products as well as its services (including wealth management services), which may result in loss of market share and reduced income from deposits, loans, advisory fees and income from other products;
•failure to identify and complete favorable acquisitions in the future or unexpected losses, difficulties or developments related to the Company’s recent or future acquisitions;
•unexpected difficulties and losses related to FDIC-assisted acquisitions;
•harm to the Company’s reputation;
•any negative perception of the Company’s financial strength;
•ability of the Company to raise additional capital on acceptable terms when needed;
•disruption in capital markets, which may lower fair values for the Company’s investment portfolio;
•ability of the Company to use technology to provide products and services that will satisfy customer demands and create efficiencies in operations and to manage risks associated therewith;
•failure or breaches of our security systems or infrastructure, or those of third parties;
•security breaches, including denial of service attacks, hacking, social engineering attacks, malware intrusion and similar events or data corruption attempts and identity theft;
•adverse effects on our information technology systems, or those of third parties, resulting from failures, human error or cyberattacks (including ransomware);
•adverse effects of failures by our vendors to provide agreed upon services in the manner and at the cost agreed, particularly our information technology vendors;
•increased costs as a result of protecting our customers from the impact of stolen debit card information;
•accuracy and completeness of information the Company receives about customers and counterparties to make credit decisions;
•ability of the Company to attract and retain senior management experienced in the banking and financial services industries;
•environmental liability risk associated with lending activities;
•the impact of any claims or legal actions to which the Company is subject, including any effect on our reputation;
•losses incurred in connection with repurchases and indemnification payments related to mortgages and increases in reserves associated therewith;
•the loss of customers as a result of technological changes allowing consumers to complete their financial transactions without the use of a bank;
•the soundness of other financial institutions and the impact of recent failures of financial institutions, including broader financial institution liquidity risk and concerns;
67
Table of Contents
•the expenses and delayed returns inherent in opening new branches and de novo banks;
•liabilities, potential customer loss or reputational harm related to closings of existing branches;
•examinations and challenges by tax authorities, and any unanticipated impact of tax legislation;
•changes in accounting standards, rules and interpretations, and the impact on the Company’s financial statements;
•the ability of the Company to receive dividends from its subsidiaries;
•a decrease in the Company’s capital ratios, including as a result of declines in the value of its loan portfolios, or otherwise;
•legislative or regulatory changes, particularly changes in regulation of financial services companies and/or the products and services offered by financial services companies;
•changes in laws, regulations, rules, standards and contractual obligations regarding data privacy and cybersecurity;
•a lowering of our credit rating;
•changes in U.S. monetary policy and changes to the Federal Reserve’s balance sheet, including changes in response to persistent inflation or otherwise;
•regulatory restrictions upon our ability to market our products to consumers and limitations on our ability to profitably operate our mortgage business;
•increased costs of compliance, heightened regulatory capital requirements and other risks associated with changes in regulation and the regulatory environment;
•the impact of heightened capital requirements;
•increases in the Company’s FDIC insurance premiums, or the collection of special assessments by the FDIC;
•delinquencies or fraud with respect to the Company’s premium finance business;
•credit downgrades among commercial and life insurance providers that could negatively affect the value of collateral securing the Company’s premium finance loans;
•the Company’s ability to comply with covenants under its credit facility;
•fluctuations in the stock market, which may have an adverse impact on the Company’s wealth management business and brokerage operation; and
•widespread outages of operational, communication, or other systems, whether internal or provided by third parties, natural or other disasters (including acts of terrorism, armed hostilities and pandemics), and the effects of climate change.
Therefore, there can be no assurances that future actual results will correspond to any forward-looking statement. The reader is cautioned not to place undue reliance on any forward-looking statement made by the Company. Any such statement speaks only as of the date the statement was made or as of such date that may be referenced within the statement. The Company undertakes no obligation to update any forward-looking statement to reflect the impact of circumstances or events after the date of this report. Persons are advised, however, to consult further disclosures management makes on related subjects in its reports filed with the Securities and Exchange Commission and in its press releases.
ITEM 3
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
As an ongoing part of its financial strategy, the Company attempts to manage the impact of fluctuations in market interest rates on net interest income. This effort entails providing a reasonable balance between interest rate risk, credit risk, liquidity risk and maintenance of yield. Asset-liability management policies are established and monitored by management in conjunction with the boards of directors of the banks, subject to general oversight by the Risk Management Committee of the Company’s Board. The policies establish guidelines for acceptable limits on the sensitivity of the market value of assets and liabilities to changes in interest rates.
Interest rate risk arises when the maturity or re-pricing periods and interest rate indices of the interest-earning assets, interest-bearing liabilities, and derivative financial instruments are different. It is the risk that changes in the level of market interest rates will result in disproportionate changes in the value of, and the net earnings generated from, the Company’s interest-earning assets, interest-bearing liabilities and derivative financial instruments. The Company continuously monitors not only the organization’s current net interest margin, but also the historical trends of these margins. In addition, management attempts to identify potential adverse changes in net interest income in future years as a result of interest rate fluctuations by performing simulation analysis of various interest rate environments. If a potential adverse change in net interest margin and/or net income is identified, management is prepared to take appropriate action with its asset-liability structure to mitigate these potentially adverse situations. Please refer to Item 2 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for further discussion of the net interest margin.
Since the Company’s primary source of interest-bearing liabilities is from customer deposits, the Company’s ability to manage the types and terms of such deposits is somewhat limited by customer preferences and local competition in the market areas in which the banks operate. The rates, terms and interest rate indices of the Company’s interest-earning assets result primarily
68
Table of Contents
from the Company’s strategy of investing in loans and securities that permit the Company to limit its exposure to interest rate risk, together with credit risk, while at the same time achieving an acceptable interest rate spread.
The Company’s exposure to interest rate risk is reviewed on a regular basis by management and the Risk Management Committees of the boards of directors of the banks and the Company. The objective of the review is to measure the effect on net income and to adjust balance sheet and derivative financial instruments to minimize the inherent risk while at the same time maximize net interest income.
The following interest rate scenarios display the percentage change in net interest income over a one-year time horizon assuming increases and decreases of 100 and 200 basis points as compared to projected net interest income in a scenario with no assumed rate changes. The Static Shock Scenario results incorporate actual cash flows and repricing characteristics for balance sheet instruments following an instantaneous, parallel change in market rates based upon a static (i.e. no growth or constant) balance sheet. Conversely, the Ramp Scenario results incorporate management’s projections of future volume and pricing of each of the product lines following a gradual, parallel change in market rates over twelve months. Actual results may differ from these simulated results due to timing, magnitude, and frequency of interest rate changes as well as changes in market conditions and management strategies. The interest rate sensitivity for both the Static Shock and Ramp Scenarios at March 31, 2026, December 31, 2025 and March 31, 2025 is as follows:
| Static Shock Scenarios | +200 Basis Points | +100 Basis Points | -100 Basis Points | -200 Basis Points | |||||||||||||||||||
| March 31, 2026 | (0.8) | % | (0.1) | % | (1.0) | % | (1.9) | % | |||||||||||||||
| December 31, 2025 | (1.6) | (0.5) | (0.5) | (0.8) | % | ||||||||||||||||||
| March 31, 2025 | (1.8) | (0.6) | (0.2) | (1.2) | % | ||||||||||||||||||
| Ramp Scenarios | +200 Basis Points | +100 Basis Points | -100 Basis Points | -200 Basis Points | |||||||||||||||||||
| March 31, 2026 | (0.1) | % | 0.0 | % | (0.1) | % | (0.3) | % | |||||||||||||||
| December 31, 2025 | (0.0) | 0.1 | (0.1) | (0.2) | % | ||||||||||||||||||
| March 31, 2025 | 0.2 | 0.2 | (0.1) | (0.5) | % | ||||||||||||||||||
One method utilized by financial institutions, including the Company, to manage interest rate risk is to enter into derivative financial instruments. Derivative financial instruments include interest rate swaps, interest rate caps, floors and collars, futures, forwards, option contracts and other financial instruments with similar characteristics. Additionally, the Company enters into commitments to fund certain mortgage loans (interest rate locks) to be sold into the secondary market and forward commitments for the future delivery of mortgage loans to third party investors. See Note (14) “Derivative Financial Instruments” of the Consolidated Financial Statements in Item 1 of this report for further information on the Company’s derivative financial instruments.
As shown above, the magnitude of potential changes in net interest income in various interest rate scenarios has continued to remain relatively neutral. Management has taken action to reposition its sensitivity to interest rates to stabilize net interest margin following the rise in short term interest rates in 2022 and 2023. To this end, management has executed various derivative instruments including collars, floors, and receive-fixed swaps to hedge variable-rate loan exposures. The Company will continue to monitor current and projected interest rates and may execute additional derivatives to mitigate potential fluctuations in the net interest margin in future periods.
Periodically, the Company enters into certain covered call option transactions related to certain securities held by the Company. The Company uses these option transactions (rather than entering into other derivative interest rate contracts, such as interest rate floors) to economically hedge positions and compensate for net interest margin compression by increasing the total return associated with the related securities through fees generated from these options. Although the revenue received from these options is recorded as non-interest income rather than interest income, the increased return attributable to the related securities from these options contributes to the Company’s overall profitability. The Company’s exposure to interest rate risk may be impacted by these transactions. To further mitigate this risk, the Company may acquire fixed-rate term debt or use financial derivative instruments. There were no covered call options outstanding as of March 31, 2026 and March 31, 2025. See Note (14) “Derivative Financial Instruments” of the Consolidated Financial Statements in Item 1 of this report for further information on the Company’s fees from covered call options for the three months ended March 31, 2026 and March 31, 2025.
69
Table of Contents
ITEM 4
CONTROLS AND PROCEDURES
As of the end of the period covered by this report, management of the Company, under the supervision and with the participation of the Chief Executive Officer and Chief Financial Officer, carried out an evaluation of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as defined under Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (“Exchange Act”). Based upon, and as of the date of that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective, in ensuring the information relating to the Company (and its consolidated subsidiaries) required to be disclosed by the Company in the reports it files or submits under the Exchange Act was recorded, processed, summarized and reported in a timely manner.
There were no changes in the Company’s internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f)) during the period that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.
PART II —
Item 1: Legal Proceedings
In accordance with applicable accounting principles, the Company establishes an accrued liability for litigation and threatened litigation actions and proceedings when those actions present loss contingencies, which are both probable and estimable. In actions for which a loss is reasonably possible in future periods, the Company determines whether it can estimate a loss or range of possible loss. To determine whether a possible loss is estimable, the Company reviews and evaluates its material litigation on an ongoing basis, in conjunction with any outside counsel handling the matter, in light of potentially relevant factual and legal developments. This review may include information learned through the discovery process, rulings on substantive or dispositive motions, and settlement discussions.
Wintrust Mortgage Fair Lending Matter
On May 25, 2022, a Wintrust Mortgage customer filed a putative class action and asserted individual claims against Wintrust Mortgage and Wintrust Financial Corporation in the District Court for the Northern District of Illinois. Plaintiff alleged that Wintrust Mortgage discriminated against black/African American borrowers and brings class claims under the Equal Credit Opportunity Act, Sections 1981 and 1982 under Chapter 42 of the United States Code; and the Fair Housing Act of 1968. Plaintiff also asserted individual claims under theories of promissory estoppel, fraudulent inducement, and breach of contract. On September 23, 2022, Wintrust filed a motion to dismiss the entire suit and the court granted that motion to dismiss on September 27, 2023 and gave Plaintiff until October 20, 2023 to file an amended complaint. Plaintiff timely filed an amended complaint. Wintrust moved to dismiss the amended complaint on November 21, 2023 and on February 5, 2026, the court granted Wintrust’s motion with prejudice. Plaintiff filed an appeal of the second dismissal with the United States Court of Appeals for the Seventh Circuit. Briefing of the appeal is expected to conclude by the end of the third quarter of 2026.
Other Matters
In addition, the Company and its subsidiaries, from time to time, are subject to pending and threatened legal action and proceedings arising in the ordinary course of business.
Based on information currently available and upon consultation with counsel, management believes that the eventual outcome of any pending or threatened legal actions and proceedings described above, including our ordinary course litigation, will not have a material adverse effect on the operations or financial condition of the Company. However, it is possible that the ultimate resolution of these matters, if unfavorable, may be material to the results of operations or financial condition for a particular period.
Item 1A: Risk Factors
There have been no material changes from the risk factors set forth under Part I, Item 1A “Risk Factors” in the 2025 Form 10-K.
70
Table of Contents
Item 2: Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities
No purchases of the Company’s common shares were made by or on behalf of the Company or any “affiliated purchaser” as defined in Rule 10b-18(a)(3) under the Exchange Act, as amended, during the three months ended March 31, 2026.
Item 5: Other Information
Securities Trading Plans of Directors and Officers
During the three months ended March 31, 2026, none of our directors or officers adopted or terminated a Rule 10b5-1 trading plan or adopted or terminated a non-Rule 10b5-1 trading arrangement (as each term is defined in Item 408(a) of Regulation S-K under the Exchange Act).
Item 6: Exhibits:
(a)Exhibits
31.1 | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |||||||
31.2 | Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |||||||
32.1 | Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |||||||
| 101.INS | The XBRL Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document (1) | |||||||
| 101.SCH | XBRL Taxonomy Extension Schema Document | |||||||
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | |||||||
| 101.LAB | XBRL Taxonomy Extension Label Linkbase Document | |||||||
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | |||||||
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | |||||||
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | |||||||
(1)Includes the following financial information included in the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2026, formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) the Consolidated Statements of Condition, (ii) the Consolidated Statements of Income, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Changes in Shareholders’ Equity, (v) the Consolidated Statements of Cash Flows, and (vi) Notes to Consolidated Financial Statements
71
Table of Contents
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
WINTRUST FINANCIAL CORPORATION (Registrant) | ||||||||||||||
| Date: | May 6, 2026 | /s/ DAVID L. STOEHR | ||||||||||||
| David L. Stoehr | ||||||||||||||
| Executive Vice President and Chief Financial Officer (Principal Financial Officer and duly authorized officer) | ||||||||||||||
| Date: | May 6, 2026 | /s/ JEFFREY D. HAHNFELD | ||||||||||||
| Jeffrey D. Hahnfeld | ||||||||||||||
| Executive Vice President, Controller and Chief Accounting Officer (Principal Accounting Officer and duly authorized officer) | ||||||||||||||
72
FAQ
How did Wintrust Financial (WTFC) perform financially in Q1 2026?
Wintrust Financial reported higher profitability in Q1 2026, with net income of $227.4 million versus $189.0 million a year earlier. Net interest income reached $579.0 million, supported by loan and deposit growth across its community banking, specialty finance, and wealth management segments.
What were Wintrust Financial (WTFC) earnings per share in Q1 2026?
Wintrust’s Q1 2026 basic EPS was $3.26, up from $2.73 in Q1 2025, while diluted EPS increased to $3.22 from $2.69. The improvement reflects stronger net income and modest growth in weighted average common shares outstanding during the quarter.
How large are Wintrust Financial (WTFC) loans and deposits as of March 31, 2026?
As of March 31, 2026, Wintrust reported total loans of $54.1 billion and total deposits of $58.9 billion. The loan book spans commercial, commercial real estate, residential, and premium finance receivables, while deposits are diversified across non‑interest‑bearing, money market, savings, and time accounts.
What happened to Wintrust Financial (WTFC) credit provisions in Q1 2026?
Wintrust’s provision for credit losses in Q1 2026 was $29.6 million, up from $24.0 million a year earlier. Net charge‑offs also rose, and the total allowance for credit losses increased to $471.6 million, reflecting management’s conservative approach to potential credit risk in the portfolio.
How did unrealized securities and derivatives positions affect Wintrust (WTFC) in Q1 2026?
Wintrust recorded total other comprehensive loss of $71.1 million in Q1 2026, mainly from unrealized losses on available‑for‑sale securities and derivative instruments. These non‑cash valuation changes reduced comprehensive income, though net income remained strong and shareholders’ equity increased overall.
What is Wintrust Financial (WTFC) total asset and equity position at March 31, 2026?
At March 31, 2026, Wintrust reported total assets of $72.2 billion and total shareholders’ equity of $7.38 billion. Equity includes $425.0 million of Series F preferred stock and strong retained earnings of $4.72 billion, supporting the company’s capital base.