Associated Banc-Corp’s ASB first-quarter 2026 earnings of 70 cents per share beat the Zacks Consensus Estimate by a penny. The bottom line compared favorably with 59 cents in the prior-year quarter.
Results reflected higher net interest income (NII) and non-interest income. A rise in loans and deposit balances, and lower provisions acted as tailwinds. However, higher expenses were an undermining factor.
Net income available to common equity was $117 million, up 18% year over year. Our estimate for the metric was $113.7 million.
ASB’s Revenues Rise, Expenses Up
Total revenues (FTE basis) for the quarter were $387.2 million, up from $349 million in the prior-year quarter. The top line outpaced the Zacks Consensus Estimate of $385 million.
NII was $309.2 million, increasing 7% year over year. The net interest margin was 3.03%, up 6 basis points (bps). The rise was driven by a lower average cost of total interest-bearing liabilities. We had expected NII and net interest yield to be $300.2 million and 3.04%, respectively.
Non-interest income totaled $75.9 million, improving 29% from the prior-year quarter. This primarily reflected increases in wealth management fees, service charges and deposit account fees, card-based fees, capital markets revenue and mortgage banking income. Our estimate for non-interest income was $72.5 million.
Non-interest expenses were $219 million, up 4% year over year. The rise mainly reflected higher personnel, technology, business development and advertising, equipment and legal and professional costs, partially offset by lower occupancy, FDIC assessment, loan and foreclosure costs, and other expenses. Our estimate for non-interest expenses was $213.9 million.
The adjusted efficiency ratio was 55.77%, down from 58.55% in the prior-year quarter. A fall in the efficiency ratio indicates an improvement in profitability.
Associated Banc-Corp’s Loans & Deposits Rise
As of March 31, 2026, total loans were $31.8 billion, up 2% sequentially. The rise was primarily driven by higher commercial and business lending and commercial real estate lending. Our estimate for total loans was $31.7 billion.
Total deposits rose 1% sequentially to $35.7 billion. Our estimate for total deposits was $36.4 billion.
Associated Banc-Corp’s Credit Quality Improves
In the reported quarter, the company recorded a provision for credit losses of $11 million, down from $13 million in the prior-year quarter. Our estimate for the metric was $16.1 million.
As of March 31, 2026, total non-performing assets were $143.9 million, down 9% year over year. Total non-accrual loans were $110.6 million, falling 18%.
Net charge-offs were $5 million, down 39% from the prior-year quarter.
Associated Banc-Corp’s Capital Ratios Improve
As of March 31, 2026, the common equity Tier 1 (CET1) capital ratio was 10.47%, up from 10.11% recorded in the corresponding period of 2025. The Tier 1 capital ratio was 11.01%, up from 10.68%.
ASB 2026 View
After including the impact of the acquisition of American National Corporation, management expects total period-end loan growth of 17-19% compared with ASB’s standalone results for the year ended Dec. 31, 2025.
Period-end total deposit growth is estimated in the range of 17-19%, while period-end core customer deposit growth is anticipated in the 19-21% band.
The company expects to share an updated 2026 NII and non-interest expense outlook following the finalization of purchase accounting adjustments tied to the acquisition of American National Corporation.
Total non-interest income is expected to rise 8-10%.
The annual effective tax rate is expected to be 19-21%.
Our Take on Associated Banc-Corp
Associated Banc-Corp’s solid quarterly performance highlights the benefits of its growth momentum and disciplined balance sheet management. Continued commercial and industrial loan growth, expanding core customer deposits, steady credit performance and a solid capital position bode well for the company’s sustained growth. The buyout of American National Corporation will also support its financials. However, rising expenses remain a near-term headwind.
Associated Banc-Corp Price, Consensus and EPS Surprise
Associated Banc-Corp price-consensus-eps-surprise-chart | Associated Banc-Corp Quote
ASB currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of ASB’s Peer Banks
Bank OZK OZK reported first-quarter 2026 adjusted earnings per share of $1.44, which missed the Zacks Consensus Estimate of $1.46. Also, the bottom line declined 2% year over year.
Results were primarily hurt by higher provisions for credit losses and a rise in operating expenses. A decline in non-interest income also acted as a headwind. Nevertheless, solid NII growth and healthy loans and deposits balances provided support to Bank OZK’s performance.
East West Bancorp, Inc.’s EWBC first-quarter 2026 earnings per share of $2.57 beat the Zacks Consensus Estimate of $2.46. Moreover, the bottom line increased 22.9% from the prior-year quarter’s level.
The results were primarily aided by an increase in NII and non-interest income alongside lower provisions. Also, loan and deposit balances increased sequentially in the quarter. However, higher non-interest expenses acted as a spoilsport for East West Bancorp.
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East West Bancorp, Inc. (EWBC): Free Stock Analysis Report
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This article originally published on Zacks Investment Research (zacks.com).