WINTRUST FINANCIAL CORP
For the period ended Dec 31, 2025. Filed Feb 26, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Feb 26, 2026
WTFC$151.27-0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-28.
0001015328-25-000093
Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-K
Period ended 2025-12-31; filed 2026-02-26.
0001015328-26-000007
Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 288 previous paragraphs and 280 current paragraphs.
176 unchanged; 94 reworded; 9 added; 16 removed; 2 previous and 1 current paragraphs rearranged.
Tables are not compared: 29 previous and 31 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (9)
Current report
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 December 31, 2025:
Current report
NM—Not Meaningful
Current report
Operating lease income totaled $62.3 million in 2025 compared to $58.7 million in 2024. The increase in 2025 was primarily related to growth in business from the Company’s leasing divisions.
Current report
NM—Not Meaningful
Current report
Income Taxes
Current report
PCD-Purchased credit deteriorated.
Current report
On July 15, 2025, the Company redeemed all 5,000,000 issued and outstanding shares of the Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series D (the “Series D Preferred Stock”), for a redemption price of $25.00 per share or $125.0 million. Also, the Company redeemed all 11,500 issued and outstanding shares of 6.875% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series E (the “Series E Preferred Stock”), and all of the related 11,500,000 issued and outstanding depositary shares (the “Depositary Shares”), each representing a 1/1,000 th interest in a share of Series E Preferred Stock, for a redemption price of $25,000 per share of Series E Preferred Stock (or $25.00 per Depositary Share) or $287.5 million. The regular quarterly dividends on the Series D Preferred Stock and the Series E Preferred Stock represented by the Depositary Shares were paid separately on July 15, 2025 to holders of record on July 1, 2025. Accordingly, the redemption price did not include any accrued and unpaid dividends.
Current report
In May 2025, the Company issued 17,000 shares of fixed-rate reset non-cumulative perpetual preferred stock, Series F, liquidation preference $25,000 per share (the “Series F Preferred Stock”) as part of a $425 million public offering of 17,000,000 depository shares, each representing a 1/1000th interest in a share of Series F Preferred Stock. When, as and if declared, dividends on the Series F Preferred Stock are payable quarterly in arrears at a fixed rate of 7.875% per annum starting October 15, 2025. The redemption of the Series D Preferred Stock and Series E Preferred Stock in July 2025 was funded with a portion of the net proceeds from the issuance of the Series F Preferred Stock.
Current report
In January and April of 2025, Wintrust declared cash dividends aggregating $0.82 per share and $859.38 per share of Series D and Series E Preferred Stock, respectively. In connection with the redemption of the Series D and Series E Preferred Stock, no further dividends were declared on these series following their redemption. In July and October of 2025, Wintrust declared cash dividends aggregating $1,274.22 per share of Series F Preferred Stock.
Removed paragraphs (16)
Previous report
The Company has continued its practice of writing call options against certain investment securities to economically hedge the securities positions and receive fee income to compensate for net interest margin compression. In 2024, the Company recognized $10.2 million in fees on covered call options compared to $21.9 million in 2023.
Previous report
The Company utilizes “back to back” interest rate derivative transactions, primarily interest rate swaps, to receive floating rate interest payments related to customer loans. In these arrangements, the Company makes a floating rate loan to a borrower who prefers to pay a fixed rate. To accommodate the risk management strategy of certain qualified borrowers, the Company enters a swap with its borrower to effectively convert the borrower's variable rate loan to a fixed rate. However, in order to minimize the Company's exposure on these transactions and continue to receive a floating rate, the Company simultaneously executes an offsetting mirror-image swap with various third parties.
Previous report
Business Combination
Previous report
On April 3, 2023, the Company completed its acquisition of Rothschild & Co Asset Management US Inc. and Rothschild & Co Risk Based Investments LLC from Rothschild & Co North America Inc. As of the acquisition date, the Company acquired approximately $12.6 million in net assets. As the transaction was determined to be a business combination, the Company recorded goodwill of approximately $2.6 million on the purchase.
Previous report
A portion of the Company’s assets and liabilities are carried at fair value on the Consolidated Statements of Condition, with changes in fair value recorded either through earnings or other comprehensive income in accordance with applicable accounting principles generally accepted in the United States. These include the Company’s trading account securities, available-for-sale debt securities, equity securities with a readily determinable fair value, derivatives, mortgage loans held-for-sale, certain loans held-for-investment and mortgage servicing rights (“MSRs”). The determination of fair value is important for certain other assets, including goodwill and other intangible assets, loans individually assessed when measuring a related allowance for credit loss, and other real estate owned that are periodically evaluated for impairment using fair value estimates.
Previous report
Impairment Testing of Goodwill
Previous report
The Company performs impairment testing of goodwill for each of its reporting units on an annual basis or more frequently when events warrant, using a qualitative or quantitative approach. Using a qualitative approach, the Company reviews any recent events or circumstances that would indicate it is more likely than not that the fair value of a reporting unit is less than its carrying amount. These events and circumstances include the performance of the Company, the condition of the related industry in which the reporting unit operates and general economic environment and other factors. If the Company determines it is not more likely than not that there is impairment based on an evaluation of these events and circumstances, the Company may forgo the quantitative approach.
Previous report
Using a quantitative approach, the Company compares each reporting unit’s fair value to its carrying value. If the carrying value of a reporting unit was determined to have been higher than its fair value, the Company would measure and recognize an impairment loss for the amount by which the carrying value exceeds the fair value of the reporting unit. Any impairment loss would not exceed the total amount of goodwill allocated to the reporting unit. Valuations are estimated in good faith by management through the use of publicly available valuations of comparable entities and discounted cash flow models using internal financial projections in the reporting unit’s business plan.
Previous report
Under both a qualitative and quantitative approach, the goodwill impairment analysis requires management to make subjective judgments in determining if an indicator of impairment has occurred. Events and factors that may significantly affect the analysis include: a significant decline in the Company’s expected future cash flows, a substantial increase in the discount rate, a sustained, significant decline in the Company’s stock price and market capitalization, a significant adverse change in legal factors or in the business climate. Other factors might include changing competitive forces, customer behaviors and attrition, revenue trends, cost structures, along with specific industry and market conditions. Adverse change in these factors could have a significant impact on the recoverability of intangible assets and could have a material impact on the Company’s consolidated financial statements.
Previous report
As of December 31, 2024, the Company had three reporting units: Community Banking, Specialty Finance and Wealth Management. Based on the Company’s 2024 annual goodwill impairment testing, which was performed quantitatively, the Company concluded that the fair value of each reporting unit more likely than not exceeded the carrying amounts of the respective reporting units.
Previous report
The Company is subject to the income tax laws of the United States, its states, Canada and other jurisdictions where it conducts business. These laws are complex and subject to potentially different interpretations by the taxpayer and the various taxing authorities. In determining the provision for income taxes, management must make judgments and estimates about the application of these inherently complex laws, related regulations and case law. In the process of preparing the Company’s tax returns, management attempts to make reasonable interpretations of the tax laws. These interpretations are subject to challenge by the tax authorities upon audit or to reinterpretation based on management’s ongoing assessment of facts and evolving case law. Management reviews its uncertain tax positions and recognition of the benefits of such positions on a regular basis.
Previous report
On a quarterly basis, management assesses the reasonableness of its effective tax rate based upon its current best estimate of net income and the applicable taxes expected for the full year. Deferred tax assets and liabilities are reassessed on a quarterly basis, if business events or circumstances warrant. Additionally, any enactment of new tax rates requires the Company to re-measure its existing deferred tax assets and liabilities to reflect the new tax rate, with such adjustments recognized in current year earnings. See Note (17) “Income Taxes” to the Consolidated Financial Statements in Item 8 for a further discussion of income taxes.
Previous report
Professional fees expense increased in 2024 compared to 2023 primarily as a result of increased fees on consulting services and legal costs associated with the Macatawa acquisition. Professional fees include legal, audit, and tax fees, external loan review costs, consulting arrangements and normal regulatory exam assessments.
Previous report
(1)This includes activity for premium finance receivables and indirect consumer loans.
Previous report
Short-term borrowings include securities sold under repurchase agreements of customer sweep accounts in connection with master repurchase agreements at the banks. At December 31, 2024, the Company had none of these types of borrowings compared to $13.4 million at December 31, 2023. This funding category typically fluctuates based on customer preferences and daily liquidity needs of the banks, their customers and the banks’ operating subsidiaries. See Note (13) “Other Borrowings” to the Consolidated Financial Statements in Item 8 for further discussion of these borrowings.
Previous report
In June 2022, the Company sold a total of 3,450,000 shares of its common stock through a public offering. Net proceeds to the Company totaled approximately $285.7 million, net of estimated issuance costs.
Reworded paragraphs (94)
Previous wording
The Company recorded net income of $695.0 million for the year of 2024 compared to $622.6 million and $509.7 million for the years of 2023 and 2022, respectively. The results for 2024 demonstrate increased net interest income primarily due to increased growth in earning assets, as well as increased wealth management revenue and mortgage banking revenues as a result of a favorable fair value adjustments of MSRs, net of servicing hedge, and an increase in loans originated for sale, partially offset by payoffs, paydowns and repurchases of the existing portfolio.
Current wording
The Company recorded net income of $823.8 million for the year of 2025 compared to $695.0 million and $622.6 million for the years of 2024 and 2023, respectively. The results for 2025 were driven by increased net interest income primarily due to increased growth in earning assets.
Previous wording
The Company increased its loan portfolio from $42.1 billion at December 31, 2023 to $48.1 billion at December 31, 2024. This increase was primarily due to growth in several portfolios, including the commercial, industrial and other, commercial real estate, property and casualty premium finance receivables, and residential real estate portfolios. For more information regarding changes in the Company’s loan portfolio, see “Analysis of Financial Condition – Interest Earning Assets” and Note (4) “Loans” to the Consolidated Financial Statements presented under Item 8 of this Annual Report on Form 10-K.
Current wording
The Company increased its loan portfolio from $48.1 billion at December 31, 2024 to $53.1 billion at December 31, 2025. This increase was across all major loan portfolios. For more information regarding changes in the Company’s loan portfolio, see “Analysis of Financial Condition – Interest Earning Assets” and Note (4) “Loans” to the Consolidated Financial Statements presented under Item 8 of this Annual Report on Form 10-K.
Previous wording
The Company recorded net interest income of $2.0 billion in 2024 compared to $1.8 billion and $1.5 billion in 2023 and 2022, respectively. The higher level of net interest income recorded in 2024 compared to 2023 resulted primarily from a $5.7 billion increase in average earning assets partially offset by a 15 basis point decline in the net interest margin in 2024 (see “Net Interest Margin” section later in this Item 7 for further detail).
Current wording
The Company recorded net interest income of $2.2 billion in 2025 compared to $2.0 billion and $1.8 billion in 2024 and 2023, respectively. The higher level of net interest income recorded in 2025 compared to 2024 resulted primarily from a $7.4 billion increase in average earning assets (see “Net Interest Margin” section later in this Item 7 for further detail).
Previous wording
Non-interest income totaled $488.3 million in 2024, increasing $54.2 million, or 12%, compared to 2023. The increase in non-interest income in 2024 compared to 2023 was primarily attributable to a $20.0 million gain recognized in the first quarter of 2024 related to the sale of the Company’s Retirement Benefits Advisors (“RBA”) division within its wealth management business and an increase in mortgage banking revenues as a result of favorable fair value adjustments of MSRs, net of servicing hedge, and an increase in loans originated for sale, partially offset by payoffs, paydowns and repurchases of the existing portfolio (see “Non-Interest Income” section later in this Item 7 for further detail).
Current wording
Non-interest income totaled $501.9 million in 2025, increasing $13.6 million, or 3%, compared to 2024. The increase in non-interest income in 2025 compared to 2024 was primarily attributable to service charges on deposits, gains on investment securities and fees from covered call options. This was offset by a decrease in other non-interest income which included a $20.0 million gain recognized in the first quarter of 2024 related to the sale of the Company’s RBA division within its wealth management business and a slight decrease in mortgage banking revenues (see “Non-Interest Income” section later in this Item 7 for further detail).
Previous wording
Non-interest expense totaled $1.4 billion in 2024, increasing $90.2 million, or 7%, compared to 2023. The increase compared to 2023 was primarily attributable to an $69.1 million increase in salary and employee benefits expense and a $18.2 million increase in software and equipment expense (see “Non-Interest Expense” section later in this Item 7 for further detail).
Current wording
Non-interest expense totaled $1.5 billion in 2025, increasing $109.3 million, or 8%, compared to 2024. The increase compared to 2024 was primarily attributable to a $56.2 million increase in salary and employee benefits expense and a $19.6 million increase in software and equipment expense (see “Non-Interest Expense” section later in this Item 7 for further detail).
Previous wording
Management considers the maintenance of adequate liquidity to be important to the management of risk. Accordingly, during 2024, the Company continued its practice of maintaining appropriate funding capacity to provide the 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. The Company had overnight liquid funds and interest-bearing deposits with banks of $4.9 billion and $2.5 billion at December 31, 2024 and 2023, respectively.
Current wording
Management considers the maintenance of adequate liquidity to be important to the management of risk. Accordingly, during 2025, the Company continued its practice of maintaining appropriate funding capacity to provide the 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. The Company had overnight liquid funds and interest-bearing deposits with banks of $3.6 billion and $4.9 billion at December 31, 2025 and 2024, respectively.
Previous wording
The economic environment in 2024 included the return of a more normal shaped yield curve that is no longer inverted as the Federal Reserve Open Market Committee pivoted to reduce short term interest rates in the second half of 2024. Additionally, overall economic forecasts improved resulting in favorable credit trends for banks. The Company has employed certain strategies to manage net income in the current environment, including those discussed below.
Current wording
In 2025, the Federal Reserve Open Market Committee continued its current cycle of reducing short term interest rates in part due to declining inflation. However, longer term interest rates did not experience a commensurate reduction resulting in an upward sloping yield curve. Although uncertainty prevails, overall economic forecasts improved resulting in generally favorable credit trends for banks. The Company has employed certain strategies to manage net income in the current environment, including those discussed below.
Previous wording
The Company has leveraged its operating strengths to grow its earning assets base while maintaining a stable net interest margin in 2024. In 2024, the Company's net interest margin decreased to 3.51% (3.53% on a fully tax-equivalent basis, non-GAAP) as compared to 3.66% (3.68% on a fully tax-equivalent basis, non-GAAP) in 2023, primarily due to increased deposit competition following bank failures in 2023. Significant growth in earning assets resulted in the Company’s net interest income increasing by $124.7 million in 2024 compared to 2023. Based on contractual terms, approximately 74% of our current loan balances are projected to reprice or mature in 2025. The magnitude of potential changes in net interest income in various interest rate scenarios has continued to remain relatively neutral. As the current interest rate cycle progressed, management took action to reposition its sensitivity to interest rates. To this end, management has executed various derivative instruments including collars 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.
Current wording
The Company has leveraged its operating strengths to grow its earning assets base while maintaining a stable net interest margin in 2025. In 2025, the Company’s net interest margin increased to 3.52% (3.53% on a fully tax-equivalent basis, non-GAAP) as compared to 3.51% (3.53% on a fully tax-equivalent basis, non-GAAP) in 2024, as the Company was able to reprice deposits to offset the impact of earning asset repricing. Significant growth in earning assets resulted in the Company’s net interest income increasing by $261.5 million in 2025 compared to 2024. 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.
Previous wording
The interest rate environment impacts the profitability and mix of the Company’s mortgage banking business which generated revenues of $93.2 million in 2024 and $83.1 million in 2023, representing 4% of total net revenue in both 2024 and 2023. Mortgage banking revenue is primarily comprised of gains on sales of mortgage loans originated for new home purchases as well as mortgage refinancing. Mortgage revenue is also impacted by changes in the fair value of MSRs and EBOs guaranteed by U.S. government agencies. Mortgage originations for sale totaled $2.6 billion and $2.0 billion in 2024 and 2023, respectively. In 2024, approximately 75% of originations were mortgages associated with new home purchases, while 25% of originations were related to refinancing of mortgages. In 2023, approximately 83% of originations were mortgages associated with new home purchases, while 17% of originations were related to refinancing of mortgages.
Current wording
The interest rate environment impacts the profitability and mix of the Company’s mortgage banking business which generated revenues of $90.8 million in 2025 and $93.2 million in 2024, representing 3% and 4% of total net revenue in 2025 and 2024, respectively. Mortgage banking revenue is primarily comprised of gains on sales of mortgage loans originated for new home purchases as well as mortgage refinancing. Mortgage revenue is also impacted by changes in the fair value of MSRs and EBOs guaranteed by U.S. government agencies. Mortgage originations for sale totaled $2.6 billion in 2025 and 2024. In 2025, approximately 68% of originations were mortgages associated with new home purchases, while 32% of originations were related to refinancing of mortgages. In 2024, approximately 75% of originations were mortgages associated with new home purchases, while 25% of originations were related to refinancing of mortgages.
Previous wording
Management believes expense management is important to enhance profitability amid increased competition. Cost control and an efficient infrastructure should position the Company appropriately as it continues its growth strategy. Management continues to be disciplined in its approach to growth and plans to leverage the Company's existing expense infrastructure to expand its presence in existing and complimentary markets. Potentially impacting the cost control strategies discussed above, the Company anticipates increased costs resulting from the regulatory environment in which we operate as well as wage inflation, higher FDIC insurance assessments and continued investment in technology.
Current wording
Management believes expense management is important to enhance profitability amid increased competition. Cost control and an efficient infrastructure should position the Company appropriately as it continues its growth strategy. Management continues to be disciplined in its approach to growth and plans to leverage the Company’s existing expense infrastructure to expand its presence in existing and complimentary markets. Potentially impacting the cost control strategies discussed above, the Company anticipates increased costs resulting from the regulatory environment in which we operate as well as wage inflation and continued investment in technology.
Previous wording
•The Company’s 2024 provision for credit losses totaled $101.0 million compared to a provision of $114.4 million in 2023 and a provision of $78.6 million in 2022. The lower provision in 2024 was primarily the result of improvements in the macroeconomic forecast, specifically the Company’s macroeconomic forecasts of key model inputs (most notably, Commercial Real Estate Price Index and Baa corporate credit spreads) despite growth in the Company's loan portfolios. Net charge-offs increased to $94.4 million in 2024 (of which $67.8 million related to commercial and commercial real estate loans), compared to $45.5 million in 2023 (of which $27.8 million related to commercial and commercial real estate loans) and $20.3 million in 2022 (of which $10.1 million related to commercial and commercial real estate loans).
Current wording
•The Company’s 2025 provision for credit losses totaled $95.6 million compared to a provision of $101.0 million in 2024 and a provision of $114.4 million in 2023. The lower provision in 2025 was primarily the result of improvements in the macroeconomic forecast, specifically the Company’s macroeconomic forecasts of key model inputs (most notably Baa corporate credit spreads) despite growth in the Company's loan portfolios. Net charge-offs decreased to $72.3 million in 2025 (of which $56.9 million related to commercial and commercial real estate loans), compared to $94.4 million in 2024 (of which $67.8 million related to commercial and commercial real estate loans) and $45.5 million in 2023 (of which $27.8 million related to commercial and commercial real estate loans).
Previous wording
•The Company's allowance for loan and unfunded lending-related commitment losses increased to $436.6 million at December 31, 2024, reflecting an increase of $9.3 million, or 2%, when compared to 2023. At December 31, 2024, approximately $222.9 million, or 51%, of the allowance for loan and unfunded lending-related commitment losses was associated with commercial real estate loans and an additional $175.8 million, or 40%, was associated with commercial loans.
Current wording
•The Company’s allowance for loan and unfunded lending-related commitment losses increased to $460.2 million at December 31, 2025, reflecting an increase of $23.6 million, or 5%, when compared to 2024. At December 31, 2025, approximately $246.9 million, or 54%, of the allowance for loan and unfunded lending-related commitment losses was associated with commercial real estate loans and an additional $178.5 million, or 39%, was associated with commercial loans.
Previous wording
•The Company has significant exposure to commercial real estate. At December 31, 2024, $12.9 billion, or 27%, of our loan portfolio was commercial real estate, with approximately 68.5% located in our market area. The commercial real estate loan portfolio was comprised of $2.4 billion in construction and development loans, and $10.5 billion in non-construction loans. In analyzing the commercial real estate market, the Company does not rely upon the assessment of broad market statistical data, in large part because the Company’s market area is diverse and covers many communities, each of which is impacted differently by economic forces affecting the Company’s general market area. As such, the extent of the decline in real estate valuations can vary meaningfully among the different types of commercial and other real estate loans made by the Company. The Company uses its multi-chartered structure and local management knowledge to analyze and manage the local market conditions at each of its banks.
Current wording
•The Company has significant exposure to commercial real estate. At December 31, 2025, $13.9 billion, or 26%, of our loan portfolio was commercial real estate, with approximately 63.9% located in our market area. The commercial real estate loan portfolio was comprised of $2.4 billion in construction and development loans, and $11.5 billion in non-construction loans. In analyzing the commercial real estate market, the Company does not rely upon the assessment of broad market statistical data, in large part because the Company’s market area is diverse and covers many communities, each of which is impacted differently by economic forces affecting the Company’s general market area. As such, the extent of the decline in real estate valuations can vary meaningfully among the different types of commercial and other real estate loans made by the Company. The Company uses its multi-chartered structure and local management knowledge to analyze and manage the local market conditions at each of its banks.
Previous wording
•Excluding early buy-out loans guaranteed by U.S. government agencies, total non-performing loans (loans on non-accrual status and loans more than 90 days past due and still accruing interest) were $170.8 million (of which $21.0 million, or 12%, was related to commercial real estate) at December 31, 2024, an increase of $31.8 million compared to December 31, 2023. Non-performing loans as a percentage of total loans were 0.36% at December 31, 2024 compared to 0.33% at December 31, 2023.
Current wording
•Excluding early buy-out loans (“EBO”) guaranteed by U.S. government agencies, total non-performing loans (loans on non-accrual status and loans more than 90 days past due and still accruing interest) were $185.8 million (of which $25.1 million, or 14%, was related to commercial real estate) at December 31, 2025, an increase of $15.0 million compared to December 31, 2024. Non-performing loans as a percentage of total loans were 0.35% at December 31, 2025 compared to 0.36% at December 31, 2024.
Previous wording
•The Company’s other real estate owned increased by $9.8 million to $23.1 million during 2024, from $13.3 million at December 31, 2023. The $23.1 million of other real estate owned as of December 31, 2024 was comprised entirely of commercial real estate property.
Current wording
•The Company’s other real estate owned decreased by $2.3 million to $20.8 million during 2025, from $23.1 million at December 31, 2024. The $20.8 million of other real estate owned as of December 31, 2025 was comprised entirely of commercial real estate property.
Previous wording
The Company enters into residential mortgage loan sale agreements with investors in the normal course of business. The Company’s practice is generally not to retain long-term fixed-rate mortgages on its balance sheet in order to mitigate interest rate risk, and consequently sells most of such mortgages into the secondary market. These agreements provide recourse to investors through certain representations concerning credit information, loan documentation, collateral and insurability. Investors request the Company to indemnify them against losses on certain loans or to repurchase loans which the investors believe do not comply with applicable representations. An increase in requests for loss indemnification can negatively impact mortgage banking revenue as additional recourse expense. The liability for estimated losses on repurchase and indemnification claims for residential mortgage loans previously sold to investors was approximately $188,000 at December 31, 2024 and $152,000 at December 31, 2023.
Current wording
The Company enters into residential mortgage loan sale agreements with investors in the normal course of business. The Company’s practice is generally not to retain long-term fixed-rate mortgages on its balance sheet in order to mitigate interest rate risk, and consequently sells most of such mortgages into the secondary market. These agreements provide recourse to investors through certain representations concerning credit information, loan documentation, collateral and insurability. Investors request the Company to indemnify them against losses on certain loans or to repurchase loans which the investors believe do not comply with applicable representations. An increase in requests for loss indemnification can negatively impact mortgage banking revenue as additional recourse expense. The liability for estimated losses on repurchase and indemnification claims for residential mortgage loans previously sold to investors was approximately $578,000 at December 31, 2025 and $188,000 at December 31, 2024.
Previous wording
Measurement of the allowance for credit losses. The Company adopted CECL as of January 1, 2020, which requires the estimate of expected credit losses over the entire life of financial assets measured at amortized cost. To measure lifetime expected credit losses, the Company adjusts credit loss estimates for reasonable and supportable forecasts of macroeconomic conditions. Such forecasts can significantly impact the profitability of our community banks as changing estimates of lifetime losses from period to period can result in significant fluctuations in provision for credit losses during those periods. In 2024, such fluctuations in provision for credit losses favorably impacted the profitability of our community banks, primarily as a result of improvement in key variables (Baa credit spread and Commercial Real Estate Price Index) within forecasted macroeconomic conditions.
Current wording
Measurement of the allowance for credit losses. The Company adopted CECL as of January 1, 2020, which requires the estimate of expected credit losses over the entire life of financial assets measured at amortized cost. To measure lifetime expected credit losses, the Company adjusts credit loss estimates for reasonable and supportable forecasts of macroeconomic conditions. Such forecasts can significantly impact the profitability of our community banks as changing estimates of lifetime losses from period to period can result in significant fluctuations in provision for credit losses during those periods. In 2025, such fluctuations in provision for credit losses favorably impacted the profitability of our community banks, primarily as a result of improvement in a key variable (Baa credit spread) within forecasted macroeconomic conditions.
Previous wording
Mortgage banking revenue. Our community banking franchise is also influenced by the level of fees generated by the origination of residential mortgages and the sale of such mortgages into the secondary market by Wintrust Mortgage. The Company recognized an increase of $10.1 million in mortgage banking revenue in 2024 compared to 2023 as a result of higher origination volumes and favorable fair value adjustments of MSRs in 2024 compared to 2023. Mortgage originations for sale totaled $2.6 billion and $2.0 billion in 2024 and 2023, respectively, and was driven by growth in both purchase and refinance originations as housing inventories have improved and interest rates pulled back from peak levels reached in 2023. Partially offsetting the impact of higher originations and production margins was the change in fair value on EBOs guaranteed by U.S. government agencies.
Current wording
Mortgage banking revenue. Our community banking franchise is also influenced by the level of fees generated by the origination of residential mortgages and the sale of such mortgages into the secondary market by Wintrust Mortgage. The Company recognized a decrease of $2.4 million in mortgage banking revenue in 2025 compared to 2024 primarily as a result of unfavorable fair value adjustments of MSRs in 2025 compared to 2024. This was partially offset by gains recognized on derivative contracts held as an economic hedge and by changes in the fair value of early buy-out loans guaranteed by the U.S. government held-for-sale. Mortgage originations for sale totaled $2.6 billion in both 2025 and 2024, respectively.
Previous wording
The primary driver of profitability related to the financing of life insurance premiums is the net interest spread that Wintrust Life Finance can produce between the yields on the loans generated and the cost of funds allocated to the business unit. Profitability of financing both commercial and life insurance premiums is also meaningfully impacted by leveraging information technology systems, maintaining operational efficiency and increasing average loan size, each of which allows us to expand our loan volume without significant capital investment.
Current wording
The primary driver of profitability related to the financing of life insurance premiums is the net interest spread that Wintrust Life Finance can produce between the yields on the loans generated and the cost of funds allocated to the business unit.
Previous wording
Our business is heavily regulated and supervised by federal agencies, state agencies and the federal & provincial governments of Canada. Both the scope of the laws and regulations and the intensity of the supervision to which our business is subject have increased in recent years, initially in response to the financial crisis, and more recently in light of other factors such as the regional banking uncertainty in early 2023, technological updates, and market changes. Many of these changes have occurred as a result of the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank Act”) and its implementing regulations, most of which are now in place. We expect that our business will remain subject to extensive regulation and supervision.
Current wording
Our business is heavily regulated and supervised by federal agencies, state agencies and the federal & provincial governments of Canada. The scope of the laws, regulations and supervision to which our business is subject have increased in response to factors such as the regional banking uncertainty in early 2023, technological updates, and market changes. We expect that our business will remain subject to extensive regulation and supervision.
Previous wording
The exact impact of the changing regulatory environment on our business and operations depends upon legislative or regulatory changes to reform the financial regulatory framework and the actions of our competitors, customers, and other market participants. Legislative and regulatory changes could have a significant impact on us by, for example, requiring us to change our business practices; requiring us to meet more stringent capital, liquidity and leverage ratio requirements; limiting our ability to pursue business opportunities; imposing additional costs and compliance obligations on us; limiting fees we can charge for services; impacting the value of our assets; or otherwise adversely affecting our businesses and our earnings’ capabilities. We have already experienced significant increases in compliance related costs in recent years, and we are now subject to more stringent risk-based capital and leverage ratio requirements than we were prior to the adoption of the U.S. Basel III Rules. We are also now subject to many mortgage-related rules promulgated by the CFPB that materially restructured the origination, services and securitization of residential mortgages in the United States. As discussed under Supervision and Regulation in Item 1, the FDIC adopted a final rule, applicable to all insured depository institutions, to increase initial base deposit insurance assessment rate schedules uniformly by 2 basis points, which began in the first quarterly assessment period of 2023. There was no change to the initial base deposit insurance assessment rate in 2024. Additionally, there was a special assessment by the FDIC that was levied on banks with an asset size above $5 billion to recoup losses from certain bank failures that occurred early in 2023. Special assessment payments began in June of 2024. We will continue to monitor the impact that the implementation of applicable rules, regulations and policies arising out of any legislative or regulatory changes may have on our organization. For further discussion of the laws and regulations applicable to us and our subsidiary banks, please refer to “Business-Supervision and Regulation.”
Current wording
The exact impact of the changing regulatory environment on our business and operations depends upon legislative or regulatory changes to reform the financial regulatory framework and the actions of our competitors, customers, and other market participants. Legislative and regulatory changes could have a significant impact on us by, for example, requiring us to change our business practices; requiring us to meet more stringent capital, liquidity and leverage ratio requirements; limiting our ability to pursue business opportunities; imposing additional costs and compliance obligations on us; limiting fees we can charge for services; impacting the value of our assets; or otherwise adversely affecting our businesses and our earnings’ capabilities. We have already experienced significant increases in compliance related costs in recent years, and we are now subject to more stringent risk-based capital and leverage ratio requirements than we were prior to the adoption of the U.S. Basel III Rules. We are also now subject to many mortgage-related rules promulgated by the CFPB that materially restructured the origination, services and securitization of residential mortgages in the United States. As discussed under Supervision and Regulation in Item 1, the FDIC adopted a final rule, applicable to all insured depository institutions, to increase initial base deposit insurance assessment rate schedules uniformly by 2 basis points, which began in the first quarterly assessment period of 2023. There was no change to the initial base deposit insurance assessment rate in 2025. Additionally, there was a special assessment by the FDIC that was levied on banks with an asset size above $5 billion to recoup losses from certain bank failures that occurred early in 2023. Special assessment payments began in June of 2024. The final scheduled payment will be made in March 2026. We will continue to monitor the impact that the implementation of applicable rules, regulations and policies arising out of any legislative or regulatory changes may have on our organization. For further discussion of the laws and regulations applicable to us and our subsidiary banks, please refer to “Business-Supervision and Regulation.”
Previous wording
On August 1, 2024, the Company completed its previously announced acquisition of Macatawa, the parent company of Macatawa Bank. In conjunction with the completed acquisition, the Company issued approximately 4.7 million shares of common stock. Macatawa operates 26 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 carrying values of approximately $2.7 billion in assets, $2.3 billion in deposits and $1.4 billion in loans. As of December 31, 2024, the Company recorded preliminary goodwill of approximately $142.1 million on the purchase. The initial purchase accounting for the acquisition, in accordance with GAAP, for this business combination is not finalized and is therefore subject to change. See Note (7) “Business Combinations” to the Consolidated Financial Statements in Item 8 for a further discussion of recent and other transactions.
Current wording
On August 1, 2024, the Company completed its previously announced acquisition of Macatawa, the parent company of Macatawa Bank. In conjunction with the completed acquisition, the Company issued approximately 4.7 million shares of common stock. 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. As of the first quarter of 2025, the purchase accounting was finalized and is no longer subject to change. See Note (7) “Business Combinations” to the Consolidated Financial Statements in Item 8 for a further discussion of recent and other transactions.
Previous wording
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. 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 material impact on the Company’s future financial condition and results of operations. At December 31, 2024, management views critical accounting estimates to include the determination of the allowance for credit 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 most subject to revision as new information becomes available. These estimates were reviewed with the Audit Committee of the Company’s Board of Directors and are discussed more fully below.
Current wording
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. 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 material impact on the Company’s future financial condition and results of operations. At December 31, 2025, 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.
Previous wording
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 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 December 31, 2024, the loan and held-to-maturity debt securities portfolios represent 80% 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.
Current wording
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 December 31, 2025, 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.
Previous wording
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, as well as the Commercial Real Estate Pricing Index (“CREPI”) specifically 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.
Current wording
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. While the Dow Jones Total Stock Market Index is not a new macroeconomic variable, we have included the impact analysis due to the significant volatility experienced in this variable in 2025. 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.
Previous wording
Holding all other inputs constant, the following table provides a sensitivity analysis for the commercial and commercial real estate portfolios based on a 20 basis point change in Baa credit spreads from the assumption utilized in the estimate of that portfolio’s allowance for credit losses at December 31, 2024:
Current wording
Holding all other inputs constant, the following table provides a sensitivity analysis for the commercial and commercial real estate portfolios based on a 35 basis point change in Baa credit spreads from the assumption utilized in the estimate of that portfolio’s allowance for credit losses at December 31, 2025:
Previous wording
Fair value is generally defined as the amount at which an asset or liability could be exchanged in a current transaction between willing, unrelated parties, other than in a forced or liquidation sale. Fair value is based on quoted market prices in an active market, or if market prices are not available, is estimated using models employing techniques such as matrix pricing or discounting expected cash flows. The significant assumptions used in the models, which include assumptions for interest rates, discount rates, prepayments and credit losses, are independently verified against observable market data where possible. Where observable market data is not available, the estimate of fair value becomes more subjective and involves a high degree of judgment. In this circumstance, fair value is estimated based on management’s judgment regarding the value that market participants would assign to the asset or liability. This valuation process takes into consideration factors such as market illiquidity. Imprecision in estimating these factors can impact the amount recorded on the balance sheet for a particular asset or liability with related impacts to earnings or other comprehensive income. See Note (22) “Fair Value of Assets and Liabilities” to the Consolidated Financial Statements in Item 8 for a further discussion of fair value measurements.
Current wording
A portion of the Company’s assets and liabilities are carried at fair value on the Consolidated Statements of Condition, with changes in fair value recorded either through earnings or other comprehensive income in accordance with GAAP. Certain asset and liability fair value estimates require significant management judgment and are disclosed as Level 3 in the fair value hierarchy. Level 3 includes a portion of the following portfolios: municipal securities, mortgage loans held-for-sale, loans held-for-investment, MSRs, and derivative assets. Since market prices are not available, Level 3 fair values are estimated using models employing techniques such as matrix pricing or discounting expected cash flows. The significant assumptions used in the models include assumptions for interest rates, discount rates, prepayments and credit losses. In this circumstance, fair value is estimated based on management’s judgment regarding the value that market participants would assign to the asset or liability because there are no observable markets to compare the assumptions to. This valuation process takes into consideration factors such as market illiquidity. Imprecision in estimating these factors can impact the amount recorded on the balance sheet for a particular asset or liability with related impacts to earnings or other comprehensive income. See Note (22) “Fair Value of Assets and Liabilities” to the Consolidated Financial Statements in Item 8 for a further discussion of fair value measurements.
Previous wording
Accounting for derivatives differs significantly depending on whether a derivative is designated as an accounting hedge, which is a transaction intended to reduce a risk associated with specific assets or liabilities or future expected cash flows at the time it is purchased. In order to qualify as an accounting hedge, a derivative must be designated as such at inception by management and meet certain criteria. Management must also continue to evaluate whether the instrument effectively reduces the risk associated with the hedged item. To determine if a derivative instrument continues to be an effective hedge, the Company must make assumptions and judgments about the continued effectiveness of the hedging strategies and the nature and timing of forecasted transactions. If the Company’s hedging strategy were to become ineffective, hedge accounting would no longer apply and the reported results of operations or financial condition could be materially affected. See Note (21) “Derivative Financial Instruments” to the Consolidated Financial Statements in Item 8 for a further discussion of derivative accounting.
Current wording
The Company utilizes derivative instruments to manage risks such as interest rate risk or market risk. The Company’s policy prohibits using derivatives for speculative purposes. Accounting for derivatives differs significantly depending on whether a derivative is designated as an accounting hedge. To determine if a derivative instrument continues to be an effective hedge, the Company must make assumptions and judgments about the continued effectiveness of the hedging strategies and the nature and timing of forecasted transactions. If the Company’s hedging strategy were to become ineffective, hedge accounting would no longer apply and the reported results of operations or financial condition could be materially affected. See Note (21) “Derivative Financial Instruments” to the Consolidated Financial Statements in Item 8 for a further discussion of derivative accounting.
Previous wording
The following discussion of Wintrust’s results of operations requires an understanding that a majority of the Company’s bank subsidiaries have been started as de novo banks since December 1991. Wintrust has a strategy of continuing to build its customer base and securing broad product penetration in each marketplace that it serves. The Company has expanded its banking franchise from three banks with five offices in 1994 to 16 banks with 205 offices at the end of 2024. FIRST Insurance Funding and Wintrust Life Finance have matured into separate divisions that generated, on a national basis, $18.1 billion in total premium finance receivables in 2024 within the United States. FIFC Canada, acquired in 2012, originated $1.9 billion in Canadian property and casualty premium finance receivables in 2024. The Company’s leasing business increased its portfolio of assets, including direct financing leases, loans and equipment on operating leases, to $3.9 billion as of December 31, 2024. In addition, the wealth management companies have been building a team of experienced professionals who are located within a majority of the banks.
Current wording
The following discussion of Wintrust’s results of operations requires an understanding that a majority of the Company’s bank subsidiaries have been started as de novo banks since December 1991. Wintrust has a strategy of continuing to build its customer base and securing broad product penetration in each marketplace that it serves. The Company has expanded its banking franchise from three banks with five offices in 1994 to 16 banks with 209 offices at the end of 2025. FIRST Insurance Funding and Wintrust Life Finance have matured into separate divisions that generated, on a national basis, $19.9 billion in total premium finance receivables in 2025 within the United States. FIFC Canada, acquired in 2012, originated $1.9 billion in Canadian property and casualty premium finance receivables in 2025. The Company’s leasing business increased its portfolio of assets, including direct financing leases, loans and equipment on operating leases, to $4.5 billion as of December 31, 2025. In addition, the wealth management companies have been building a team of experienced professionals who are located within a majority of the banks.
Previous wording
Net income for the year ended December 31, 2024, totaled $695.0 million, or $10.31 per diluted common share, compared to $622.6 million, or $9.58 per diluted common share, in 2023, and $509.7 million, or $8.02 per diluted common share, in 2022. During 2024, net income increased by $72.4 million and earnings per diluted common share increased by $0.73. Net interest income increased in 2024 compared to 2023 primarily as a result of growth in average earning assets in 2024. Non-interest income increased primarily due to a $20.0 million gain recognized in the first quarter of 2024 related to the sale of the Company’s RBA division within its wealth management business and an increase in mortgage banking revenue in 2024 as compared 2023 primarily as a result of favorable fair value adjustments of MSRs, net of servicing hedge, and an increase in loans originated for sale, partially offset by unfavorable adjustments to the Company’s held-for-sale portfolio of EBOs guaranteed by U.S. government agencies, which are held at fair value.
Current wording
Net income for the year ended December 31, 2025, totaled $823.8 million, or $11.40 per diluted common share, compared to $695.0 million, or $10.31 per diluted common share, in 2024, and $622.6 million, or $9.58 per diluted common share, in 2023. During 2025, net income increased by $128.8 million and earnings per diluted common share increased by $1.09. Net interest income increased in 2025 compared to 2024 primarily as a result of growth in average earning assets in 2025. Non-interest income increased primarily due to an increase in service charges on deposit accounts, gains on investment securities, and fees from covered call options in 2025 as compared to 2024.
Previous wording
Other items impacting net income in 2024 compared to 2023 include increased salary and employee benefits expenses.
Current wording
Other items impacting net income in 2025 compared to 2024 include increased salary and employee benefits expenses, as well as software and equipment expense.
Previous wording
Net interest income in 2024 totaled $1.96 billion, up from $1.84 billion in 2023 and up from $1.50 billion in 2022, representing an increase of $124.7 million, or 7%, in 2024 and an increase of $342.5 million, or 23%, in 2023. The table presented later in this section, titled “Changes in Interest Income and Expense,” presents the dollar amount of changes in interest income and expense, by major category, attributable to changes in the volume of the balance sheet category and changes in the rate earned or paid with respect to that category of assets or liabilities for 2024 and 2023.
Current wording
Net interest income in 2025 totaled $2.22 billion, up from $1.96 billion in 2024 and up from $1.84 billion in 2023, representing an increase of $261.5 million, or 13%, in 2025 and an increase of $124.7 million, or 7%, in 2024. The table presented later in this section, titled “Changes in Interest Income and Expense,” presents the dollar amount of changes in interest income and expense, by major category, attributable to changes in the volume of the balance sheet category and changes in the rate earned or paid with respect to that category of assets or liabilities for 2025 and 2024.
Previous wording
Average earning assets increased $5.7 billion, or 11%, in 2024 and $2.8 billion, or 6%, in 2023. Loans are the most significant component of the earning asset base as they earn interest at a higher rate than the majority of other earning assets. Average loans increased $4.4 billion, or 11%, in 2024 and $3.6 billion, or 10%, in 2023. Total average loans as a percentage of total average earning assets were 80%, 80% and 77% in 2024, 2023 and 2022, respectively. The average yield on loans was 6.82% in 2024, 6.32% in 2023 and 4.12% in 2022, reflecting an increase of 50 basis points in 2024 and an increase of 220 basis points in 2023. The higher loan yields in 2024 compared to 2023 is primarily a result of new loan originations at higher market rates along with existing loans repricing at higher levels in 2024 compared to 2023. The average yield on liquidity management assets was 3.85% in 2024, 3.53% in 2023 and 2.15% in 2022, reflecting an increase of 32 basis points in 2024 and an increase of 138 basis points in 2023. The higher yield in 2024 compared to 2023 is a result of investment security purchases at higher market rates. The average rate paid on interest-bearing deposits, the largest component of the Company’s interest-bearing liabilities, was 3.58% in 2024, 2.81% in 2023 and 0.62% in 2022, representing an increase of 77 basis points in 2024 and an increase of 219 basis points in 2023. The higher level of interest-bearing deposits rates in 2024 compared to 2023 is primarily a result of increased deposit competition driving interest rates higher in 2024 compared to 2023. As a result of the above, net interest margin decreased to 3.51% (3.53% on a fully taxable-equivalent basis, non-GAAP) in 2024 compared to 3.66% (3.68% on a fully taxable-equivalent basis, non-GAAP) in 2023.
Current wording
Average earning assets increased $7.4 billion, or 13%, in 2025 and $5.7 billion, or 11%, in 2024. Loans are the most significant component of the earning asset base as they earn interest at a higher rate than the majority of other earning assets. Average loans increased $5.5 billion, or 12%, in 2025 and $4.4 billion, or 11%, in 2024. Total average loans as a percentage of total average earning assets was 80% in 2025, 2024 and 2023. The average yield on loans was 6.43% in 2025, 6.82% in 2024 and 6.32% in 2023, reflecting a decrease of 39 basis points in 2025 and an increase of 50 basis points in 2024. The lower loan yields in 2025 compared to 2024 is primarily due to existing loans repricing to lower rates as a result of the decrease in short term interest rates that began in late 2024. The average yield on liquidity management assets was 3.86% in 2025, 3.85% in 2024 and 3.53% in 2023, reflecting an increase of one basis point in 2025 and an increase of 32 basis points in 2024. The higher yield in 2025 compared to 2024 is due to investment security purchases at higher market rates partially offset by lower yields on interest bearing cash related to reductions in the federal funds rate. The average rate paid on interest-bearing deposits, the largest component of the Company’s interest-bearing liabilities, was 3.09% in 2025, 3.58% in 2024 and 2.81% in 2023, representing a decrease of 49 basis points in 2025 and an increase of 77 basis points in 2024. The lower level of interest-bearing deposits rates in 2025 compared to 2024 is primarily a result of repricing existing deposits in conjunction with declining short term interest rates. As a result of the above, net interest margin increased to 3.52% (3.53% on a fully taxable-equivalent basis, non-GAAP) in 2025 compared to 3.51% (3.53% on a fully taxable-equivalent basis, non-GAAP) in 2024.
Previous wording
(3)Interest income on tax-advantaged loans, trading securities and investment securities reflects a tax-equivalent adjustment based on a marginal federal corporate tax rate in effect as of the applicable period. The total adjustments for the years ended December 31, 2024, 2023 and 2022 were $11.9 million, $10.1 million and $5.6 million, respectively.
Current wording
(3)Interest income on tax-advantaged loans, trading securities and investment securities reflects a tax-equivalent adjustment based on a marginal federal corporate tax rate in effect as of the applicable period. The total adjustments for the years ended December 31, 2025, 2024 and 2023 were $11.4 million, $11.9 million and $10.1 million, respectively.
Previous wording
Mortgage banking revenue increased in 2024 as compared 2023 primarily as a result of a favorable fair value adjustments of MSRs, net of servicing hedge, and a increase in loans originated for sale, partially offset by payoffs, paydowns and repurchases of the existing portfolio. 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. Mortgage loans originated for sale totaled $2.6 billion for the year ended 2024 compared to $2.0 billion for the same period of 2023. The increase in originations was primarily driven by growth in both purchase and refinance originations as housing inventories have improved and interest rates pulled back from peak levels reached in 2023. The percentage of origination volume from refinancing activities was 25% in 2024 as compared to 17% in 2023.
Current wording
Mortgage banking revenue decreased in 2025 as compared 2024 primarily as a result of an unfavorable fair value adjustment of MSRs partially offset by favorable hedge performance. 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. Mortgage loans originated for sale totaled $2.6 billion for the years ended 2025 and 2024. The percentage of origination volume from refinancing activities was 32% in 2025 as compared to 25% in 2024.
Previous wording
The Company records MSRs at fair value on a recurring basis. During 2024, the fair value of the MSRs portfolio increased due to a favorable fair value adjustment of $4.4 million and retained servicing rights which led to capitalization of $30.0 million, partially offset by reduction in value of $23.0 million due to payoffs and paydowns of the existing portfolio. See Note (6) “Mortgage Servicing Rights (“MSRs”)” to the Consolidated Financial Statements in Item 8 for a summary of the changes in the carrying value of MSRs.
Current wording
The Company records MSRs at fair value on a recurring basis. During 2025, retained servicing rights led to capitalization of $26.0 million, partially offset by a reduction in value of $23.7 million due to payoffs and paydowns of the existing portfolio, as well as an unfavorable fair value adjustment of $11.1 million. Changes in the fair value of MSRs were partially offset by gains of $5.3 million on servicing hedges, resulting in a net decrease in the fair value of the MSR portfolio during the year. See Note (6) “Mortgage Servicing Rights (“MSRs”)” to the Consolidated Financial Statements in Item 8 for a summary of the changes in the carrying value of MSRs.
Previous wording
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 during 2024 was a $7.9 million unfavorable valuation adjustment compared to a $1.3 million favorable valuation adjustment in 2023. The table below presents additional selected information regarding mortgage banking for the respective periods.
Current wording
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 during 2025 was a $5.3 million favorable valuation adjustment compared to a $7.9 million unfavorable valuation adjustment in 2024. The table below presents additional selected information regarding mortgage banking for the respective periods.
Previous wording
Wealth management revenue increased by $15.6 million in 2024 compared to the same period in 2023 primarily due to increased asset management fees as a result of higher assets under management when compared to the same period in the prior year. Trust and asset management fees are based primarily on the market value of the assets under management or administration as well as volume of tax-deferred like-kind exchange services provided during a period.
Current wording
Wealth management revenue increased by $1.2 million in 2025 compared to the same period in 2024 primarily due to increased asset management fees as a result of higher assets under management when compared to the same period in the prior year. Trust and asset management fees are based primarily on the market value of the assets under management or administration as well as volume of tax-deferred like-kind exchange services provided during a period.
Previous wording
Service charges on deposit accounts increased in 2024 compared to 2023 primarily as a result of higher fees associated with commercial account analysis fees.
Current wording
Service charges on deposit accounts increased in 2025 compared to 2024 primarily as a result of higher fees associated with commercial account analysis 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.
Previous wording
Net losses on investment securities in 2024 were primarily the result of unrealized losses on equity investments. The Company did not recognize any credit-related write-downs or other-than-temporary impairment charges within its available-for-sale or held-to-maturity investment securities portfolio in 2024 or 2023, respectively.
Current wording
Net gains on investment securities in 2025 were primarily the result of unrealized gains on equity investment securities with a readily determinable fair value. The Company did not recognize any credit-related write-downs or other-than-temporary impairment charges within its available-for-sale or held-to-maturity investment securities portfolio in 2025 or 2024, respectively. See Note (3) “Investment Securities” to the Consolidated Financial Statements in Item 8 of this report for more information on net gains and losses on investment securities.
Showing the first 40 of 94 pairs. Open the source sections for the rest.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Profitability of financing both commercial and life insurance premiums is also meaningfully impacted by leveraging information technology systems, maintaining operational efficiency and increasing average loan size, each of which allows us to expand our loan volume without significant capital investment.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
The Company utilizes derivative instruments to manage risks such as interest rate risk or market risk. The Company’s policy prohibits using derivatives for speculative purposes.
Previous report — wording carried elsewhere
Loan modifications are assessed at the time of the modification and on a quarterly basis to measure an allowance for credit loss. The carrying amount of the loan is compared to the expected payments to be received, discounted at the loan’s original rate, or for collateral dependent loans, to the fair value of the collateral. Any shortfall is recorded as a reserve.