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    WTFC
    Earnings call· Jun 2026(Q2 FY26)

    WINTRUST FINANCIAL CORP WTFC

    Jul 21, 2026 Source

    Executive summary

    Wintrust Financial Corporation Q2 FY26 — Record Net Income and Strong Growth

    Wintrust reported its sixth consecutive record quarter of net income, driven by robust organic loan and deposit growth, which management attributes to its differentiated customer experience. Despite some competitive pressures on loan yields and a slight dip in net interest margin, the company maintained stable credit quality and well-managed expenses, leading to solid operating leverage. Management remains optimistic about continued growth and capital generation for the remainder of the year.

    Highlights

    5

    • Sixth consecutive record quarter of net income, reaching $233.7 million, up from $227 million in Q1 FY26.

    • Very strong loan growth of approximately $1.6 billion, representing 12% annualized growth.

    • Exceptional deposit growth of approximately $2.2 billion, representing 15% annualized growth, without increasing deposit costs.

    • Net interest income up 13% quarter-over-quarter on an annualized basis.

    • Nonperforming loans decreased to $179.3 million or 0.32% from $182.7 million or 0.34% in the prior quarter.

    Concerns

    4

    • Loan yields moved down 7 basis points from prior quarter to 6.07% due to back book repricing of commercial insurance premium finance and competitive market pressures.

    • Net interest margin negatively impacted by 4 basis points, including 2 bps from premium finance repricing and 1 bp from competitive spread compression.

    • Mortgage revenues expected to fall back into the low $20 million range in Q3 FY26 as home buying seasonality subsides.

    • Advertising and marketing expenses increased by $7.2 million QoQ due to seasonal sports sponsorships and summertime events.

    Guidance & targets

    11
    CategoryTargetConfidence
    Loan growth
    mid- to high single digits
    high materiality
    High
    Deposit growth
    largely fund that loan growth
    high materiality
    High
    Net interest margin (NIM)
    a few basis points either side of 350
    high materiality
    Medium
    Net interest income (NII) growth
    solid growth
    high materiality
    High
    Operating leverage
    good operating leverage
    high materiality
    High
    Expenses
    remain well managed
    medium materiality
    High
    Credit performance
    solid credit performance
    high materiality
    High
    CET1 and other capital ratios
    increase
    high materiality
    High
    Mortgage revenues
    fall back into the low $20 million range
    medium materiality
    High
    Expense growth
    mid-single-digit expense growth, 26 over 25
    high materiality
    High
    Premium finance growth
    low single digits year-over-year
    medium materiality
    Medium

    Operational metrics

    9
    Loan yield
    6.07%down 7 bps from prior quarter
    Q2 FY26

    Loan yields for the quarter.

    Interest-bearing deposit cost
    2.74%flat to prior quarter
    Q2 FY26

    Cost of interest-bearing deposits.

    Mortgage banking revenue
    $34.1 millionup $4 million from Q1 FY26
    Q2 FY26

    Improvement due to spring buying season.

    BOLI income
    $2 millionhigher than Q1 FY26
    Q2 FY26

    Higher earnings on BOLI investments.

    Security gains
    $1.8 millionmore than Q1 FY26
    Q2 FY26

    Security gains recorded in the quarter.

    Tax rate
    26.5%
    Q2 FY26

    Q2 tax rate, considered a good estimate for future.

    New branch deposits
    $70 million
    within 90 days

    Deposits generated by a new branch opening.

    Swap portfolio positive impact
    1 bp
    Q2 FY26

    Positive impact from the derivatives book.

    Swap portfolio notional value
    $6 billion
    current

    Target notional value for the swap portfolio.

    Industry KPIs

    11
    MetricValueDetails
    Loans$1.6 billionUSD
    Deposits$2.2 billionUSD
    Cet1 ratio10.4%%
    Capital returns—
    Allowance reserves—
    Net interest income$18.3 millionUSD
    Net interest margin3.52%%
    Net charge offs npls0.32%%
    Total operating expenses$397.5 millionUSD
    Provision for credit losses$20 million to $30 million rangeUSD
    Efficiency ratio operating leverage—

    Deals & partnerships

    1
    Northern TrustIntent to purchase the Guardianship Services business

    Announced on July 6, expected to close later this year. Described as a good bolt-on acquisition to a well-known business.

    Risks & headwinds

    6
    Competitive market pressures on loan yieldsQ2 FY26, ongoing

    7 basis points decline in loan yields QoQ to 6.07%; 1 basis point negative impact on NIM

    Mitigation: Maintaining discipline on pricing, turning down deals with irrational pricing, focusing on value proposition and market share gains.

    Back book repricing of commercial insurance premium finance portfolioQ2 FY26, Q3 FY26

    2 basis points negative impact on NIM in Q2 FY26; expected 1-2 basis points impact in Q3 FY26

    Mitigation: The repricing cycle takes 9 months and will be complete after Q3 FY26.

    Seasonality of mortgage banking revenueQ3 FY26

    Mortgage revenues expected to fall back into the low $20 million range in Q3 FY26 from $34.1 million in Q2 FY26

    Mitigation: Anticipated and managed as part of normal business cycles.

    Seasonal increase in advertising and marketing expensesQ2 FY26, Q3 FY26

    $7.2 million increase in Q2 FY26 compared to Q1 FY26

    Mitigation: Expected to trend down in Q4 unless major sports events extend; strategic spend to support new branch openings and market share gains.

    Flattening property insurance premiums impacting premium finance growthOngoing

    Expected low single-digit year-over-year growth for premium finance business

    Mitigation: Growth in units and other professional coverages offsetting property market softness; maintaining discipline on pricing for larger deals.

    Impact of cash sorting and new product introductions (e.g., Chase Smart Cash)Ongoing

    Modest impact so far

    Mitigation: Monitoring developments, reacting accordingly, focusing on differentiated customer experience and market share gains.

    What to watch in Q3 FY26

    5

    Net Interest Margin (NIM) trajectory

    next quarter (Q3 FY26)
    Current3.52%
    Targeta few basis points either side of 350

    Why it matters

    NIM is a key driver of profitability for banks, and its stability or compression due to competitive pressures and repricing will impact NII growth.

    We continue to expect our net interest margin to be a few basis points either side of 350. We're very neutral in terms of rates up or down in the market. So where we land will depend on whether the competitive pricing pressures that Dave mentioned continue and to what degree.

    Q&A highlights

    6

    What drove the strong deposit growth, and what is the outlook for deposit pricing in Q3/Q4?

    Strong deposit growth was driven by municipal seasonality, good commercial growth (leading to treasury management fees), and retail growth, ahead of new branch openings. Deposit costs were flat. Management expects continued strong deposit growth in H2, though not at the same Q2 level, with pricing remaining rational.

    “We were very pleased that even with that growth, the deposit cost was flat. So -- all in all, a very strong deposit growth quarter. And I think we would look to not quite the same number, but strong deposit growth in the second half of the year. Pricing remains relatively rational in the market.”

    asked by Jon Arfstrom · answered by Timothy Crane

    2 min read6 chapters

    Detailed Narrative

    01

    Strategic Priorities and Performance

    Wintrust continues to focus on three key strategic priorities: exceptional customer experience, disciplined growth, and future investment. These priorities drove strong Q2 FY26 results, including record net income for the sixth consecutive quarter, robust loan and deposit growth, stable net interest margin, well-managed expenses, and consistent credit quality. The company emphasizes organic growth, building relationships one client at a time.

    02

    Deposit and Loan Dynamics

    The quarter saw exceptional deposit growth of $2.2 billion (15% annualized) without increasing deposit costs, which funded solid loan growth of $1.6 billion (12% annualized). This growth was broad-based across lending segments, with the insurance funding portfolio growing by $722 million. Management noted that period-end loans were $1.2 billion higher than average loans, providing a strong start for Q3.

    03

    Net Interest Margin and Income

    Net interest income increased by $18.3 million QoQ, driven by a $2.1 billion increase in average earning assets. The net interest margin was 3.52%, a 4 basis point decline QoQ, primarily due to a 2 basis point impact from premium finance portfolio repricing and 1 basis point from competitive spread compression. Management expects NIM to remain around 3.50% +/- a few basis points, with solid NII growth.

    04

    Credit Quality Stability

    Credit quality remained strong and stable, with nonperforming loans decreasing to 0.32% and charge-offs at 10 basis points. The provision for credit losses stayed consistent in the $20 million to $30 million range for the sixth consecutive quarter. Commercial real estate (CRE) NPLs remained low at 0.12%, and the CRE office exposure was steady at $1.6 billion, representing 2.9% of the total loan portfolio.

    05

    Expense Management and Investments

    Noninterest expenses increased to $397.5 million, primarily due to merit increases, higher mortgage commissions, and seasonal advertising. However, the company also recorded a $5.2 million reversal of FDIC assessment expense. Wintrust continues to invest in digital banking enhancements and plans to open new branches in Lakeview, Montgomery, and Northwest Indiana, supporting future growth and market presence.

    06

    M&A and Capital Outlook

    The company announced an intent to acquire Northern Trust's Guardianship Services business, a bolt-on acquisition expected to close later this year. Management expects CET1 and other capital ratios to increase in coming quarters, providing flexibility for capital deployment, with a preference for investing in business growth and acquisitions over buybacks or debt repayment.

    AI-generated summary of the company’s earnings call. Not investment advice.