Ottawa Bancorp, Inc. Announces 2026 First Quarter Results
OTTAWA, Ill., April 28, 2026 (GLOBE NEWSWIRE) -- Ottawa Bancorp, Inc. (the “Company”) (OTCQX: OTTW), the holding company for OSB Community Bank (the “Bank”), announced net income of $0.6 million, or $0.26 per basic and diluted common share, for the three months ended March 31, 2026, compared to net income of $0.4 million, or $0.19 per basic and diluted common share, for the three months ended March 31, 2025. The loan portfolio, net of allowance, increased to $308.0 million as of March 31, 2026 from $305.8 million as of December 31, 2025 as originations exceeded payments and payoffs during the quarter. Non-performing loans decreased to $1.0 million at March 31, 2026 from $1.2 million at December 31, 2025. Thus, the ratio of non-performing loans to gross loans decreased from 0.38% at December 31, 2025 to 0.34% at March 31, 2026.
Through March 31, 2026, the Company has repurchased a total of 1,202,370 shares of its common stock under all of its stock repurchase programs at an average price of $13.68 per share.
Craig M. Hepner, President and Chief Executive Officer said, “I’m pleased to report that 2026 has started out on a positive note. Reinforcing the effectiveness of our pricing and funding strategies, we continued to see expansion in our net interest margin during the first quarter as asset yields continued to trend higher while our overall cost of funds trended lower. This resulted in a significant improvement in net earnings during the first quarter as compared to the same period a year ago.”
Mr. Hepner went on to say, “We continue to focus our efforts on reducing our reliance on higher cost wholesale funding and originating high quality, higher yielding commercial and commercial real estate loans. Our asset quality continued to improve during the quarter from already solid levels, as economic conditions within our primary markets remained relatively stable.”
Comparison of Results of Operations for the Three Months Ended March 31, 2026 and March 31, 2025
Net income for the three months ended March 31, 2026 was $0.6 million compared to $0.4 million for the three months ended March 31, 2025. Total interest and dividend income was $4.5 million for the three months ended March 31, 2026 compared to $4.1 million for the three months ended March 31, 2025. This increase was due to a $10.3 million dollar increase in interest-earning assets and an increase in the average yield on interest-earning assets which improved by 0.25% to 5.19%. Interest expense was $1.7 million for both the three months ended March 31, 2026 and 2025. Our average cost of funds decreased to 2.12% for the three months ended March 31, 2026 from 2.18% for the three months ended March 31, 2025. Net interest income after recovery of credit losses increased by $0.4 million to $2.9 million for the three months ended March 31, 2026 as compared to $2.5 million for the three months ended March 31, 2025. Total other income was $0.4 million for the three months ended March 31, 2026 compared to $0.2 million for the three months ended March 31, 2025, due mainly to an increase in loan origination and servicing income, as well as customer service fees. Total other expenses were $2.4 million for the three months ended March 31, 2026 compared to $2.2 million for the three months ended March 31, 2025. Increases in salaries and employee benefits expenses, as well as loan expenses, accounted for most of this increase. Loan expenses increased due to a one-time corrective adjustment to our Freddie Mac settlement account.
The Company recorded a recovery of approximately $81 thousand for the three months ended March 31, 2026 compared to a recovery of approximately $92 thousand for the three months ended March 31, 2025 to decrease the Allowance for Credit Losses (ACL) position. The ACL on loans was $4.1 million, or 1.30% of total gross loans, at March 31, 2026 compared to $4.2 million, or 1.35% of gross loans, at December 31, 2025. Net charge-offs during the first quarter of 2026 were approximately $55 thousand compared to net charge-offs of $120 thousand during the first quarter of 2025. The current period adjustment to the ACL is the result of the quarterly calculation of Current Expected Credit Losses (CECL). The required reserves on non-performing loans as of March 31, 2026 decreased by approximately $107 thousand compared to the required reserves as of March 31, 2025.
The Company recorded income tax expense of $0.3 million for the three-month period ended March 31, 2026 as compared to income tax expense of $0.2 million for the three months ended March 31, 2025 due to higher pretax income during the period.
Comparison of Financial Condition at March 31, 2026 and December 31, 2025
Total consolidated assets as of March 31, 2026 were $360.8 million, a decrease of $1.7 million, or 0.5%, from $362.6 million at December 31, 2025. The decrease was due primarily to a decrease of $3.0 million in cash and cash equivalents, a $0.2 million decrease in accrued interest receivable, a decrease of $0.4 million in securities available for sale and a decrease of $0.5 million in other assets. These decreases were partially offset by an increase of $2.2 million in loans, net of allowance and an increase of $0.1 million in mortgage servicing rights.
Cash and cash equivalents decreased $3.0 million, or 12.3%, to $21.3 million at March 31, 2026 from $24.3 million at December 31, 2025. The decrease in cash and cash equivalents was primarily the result of cash used in investing activities of $2.1 million and cash used in financing activities of $3.1 million exceeding cash provided by operating activities of $2.2 million.
Securities available for sale decreased $0.4 million, or 2.4%, to $15.6 million at March 31, 2026 from $16.0 million at December 31, 2025 as payments, calls and maturities during the period exceeded purchases and market value fluctuations.
Net loans increased $2.2 million, or 0.7%, to $308.0 million at March 31, 2026 compared to $305.8 million at December 31, 2025 primarily due to an increase of $5.0 million in non-residential real estate loans, and an increase of $1.3 million in multi-family loans. These increases were partially offset by a decrease of $1.1 million in commercial loans, a decrease of $3.0 million in one-to-four family residential loans and a decrease of $0.1 million in consumer direct loans. The ACL on loans decreased by $0.1 million at March 31, 2026 as compared to December 31, 2025.
Total deposits decreased $2.8 million, or 1.0%, to $295.3 million at March 31, 2026 from $298.1 million at December 31, 2025. During the three months ended March 31, 2026 certificate of deposit accounts decreased by $4.2 million, interest bearing DDA accounts decreased by $2.1 million, and non-interest bearing DDA accounts decreased by $0.1 million. Partially offsetting these decreases were increases in savings accounts of $1.6 million and increases in money market accounts of $2.0 million.
FHLB advances totaled $15.9 million at both March 31, 2026 and December 31, 2025.
Stockholders’ equity increased to $39.2 million at March 31, 2026 as compared to $39.0 million at December 31, 2025. The increase reflects net income of $0.6 million for the three months ended March 31, 2026. This increase was partially offset by a $0.1 million decrease in other comprehensive loss due to a decrease in fair value of securities available for sale during the period and cash dividends of $0.3 million paid to shareholders.
About Ottawa Bancorp, Inc.
Ottawa Bancorp, Inc. is the holding company for OSB Community Bank which provides various financial services to individual and corporate customers in the United States. The Bank offers various deposit accounts, including checking, money market, regular savings, club savings, certificates of deposit, and various retirement accounts. Its loan portfolio includes one-to-four family residential mortgage, multi-family and non-residential real estate, commercial, and construction loans as well as auto loans and home equity lines of credit. OSB Community Bank was founded in 1871 and is headquartered in Ottawa, Illinois. For more information about the Company and the Bank, please visit www.myosb.bank.
Cautionary Statement Regarding Forward-Looking Statements
This news release contains forward-looking statements within the meaning of the federal securities laws. Statements in this release that are not strictly historical are forward-looking and are based upon current expectations that may differ materially from actual results. These forward-looking statements, identified by words such as “will,” “expected,” “believe,” and “prospects,” involve risks and uncertainties that could cause actual results to differ materially from those anticipated by the statements made herein. These risks and uncertainties involve general economic trends and changes in interest rates, increased competition, changes in consumer demand for financial services, the possibility of unforeseen events affecting the industry generally, the uncertainties associated with newly developed or acquired operations, market disruptions, our ability to pay future dividends and if so at what level, our ability to receive any required regulatory approval or non-objection for the payment of dividends from the Bank to the Company or from the Company to stockholders, and our efforts to maximize stockholder value, including our ability to execute any capital management strategies, such as the repurchase of shares of the Company’s common stock, and our ability to execute any controlled growth and balance sheet strategies designed to lower the cost of funds and enhance earnings and liquidity. Ottawa Bancorp, Inc. undertakes no obligation to release revisions to these forward-looking statements publicly to reflect events or circumstances after the date hereof or to reflect the occurrence of unforeseen events, except as required to be reported under applicable law.
Ottawa Bancorp, Inc. & Subsidiary | |||||||||
| Consolidated Balance Sheets | |||||||||
| March 31, 2026 and December 31, 2025 | |||||||||
| (Unaudited) | |||||||||
| March 31, | December 31, | ||||||||
| 2026 | 2025 | ||||||||
| Assets | |||||||||
| Cash and due from banks | $ | 8,782,552 | $ | 14,340,734 | |||||
| Interest bearing deposits | 7,403,681 | 6,719,709 | |||||||
| Federal funds sold | 5,151,000 | 3,259,000 | |||||||
| Total cash and cash equivalents | 21,337,233 | 24,319,443 | |||||||
| Securities available for sale, at fair value | 15,621,142 | 16,002,114 | |||||||
| Loans, net of allowance for credit losses of $4,057,891 and $4,190,140 | |||||||||
| at March 31, 2026 and December 31, 2025, respectively | 308,020,371 | 305,758,202 | |||||||
| Mortgage servicing rights | 1,142,077 | 1,075,957 | |||||||
| Premises and equipment, net | 5,831,515 | 5,887,528 | |||||||
| Accrued interest receivable | 1,250,553 | 1,413,551 | |||||||
| Deferred tax assets, net | 2,100,343 | 2,133,620 | |||||||
| Federal Home Loan Bank stock | 1,380,798 | 1,380,798 | |||||||
| Cash value of life insurance | 528,295 | 528,464 | |||||||
| Goodwill | 649,869 | 649,869 | |||||||
| Other assets | 2,985,353 | 3,442,607 | |||||||
| Total assets | $ | 360,847,549 | $ | 362,592,153 | |||||
Liabilities and Stockholders' Equity | |||||||||
| Liabilities | |||||||||
| Deposits: | |||||||||
| Non-interest bearing | $ | 23,035,936 | $ | 23,086,883 | |||||
| Interest bearing | 272,240,311 | 275,026,699 | |||||||
| Total deposits | 295,276,247 | 298,113,582 | |||||||
| Accrued interest payable | 537,190 | 545,766 | |||||||
| FHLB advances | 15,860,000 | 15,860,000 | |||||||
| Long term debt | 1,201,923 | 1,238,661 | |||||||
| Allowance for credit losses on off-balance sheet credit exposures | 80,729 | 83,629 | |||||||
| Other liabilities | 5,971,865 | 5,047,185 | |||||||
| Total liabilities | 318,927,954 | 320,888,823 | |||||||
| Commitments and contingencies | |||||||||
| ESOP Repurchase Obligation | 2,672,922 | 2,672,922 | |||||||
| Stockholders' Equity | |||||||||
| Common stock, $.01 par value, 12,000,000 shares authorized; 2,301,478 and | |||||||||
| 2,292,784 shares issued at March 31, 2026 and December 31, 2025, respectively | 23,014 | 22,928 | |||||||
| Additional paid-in-capital | 21,184,779 | 21,060,890 | |||||||
| Retained earnings | 22,498,871 | 22,166,573 | |||||||
| Unallocated ESOP shares | (162,974 | ) | (162,974 | ) | |||||
| Unallocated management recognition plan shares | (156,936 | ) | (46,375 | ) | |||||
| Accumulated other comprehensive loss | (1,467,159 | ) | (1,337,712 | ) | |||||
| 41,919,595 | 41,703,330 | ||||||||
| Less: | |||||||||
| ESOP Owned Shares | (2,672,922 | ) | (2,672,922 | ) | |||||
| Total stockholders' equity | 39,246,673 | 39,030,408 | |||||||
| Total liabilities and stockholders' equity | $ | 360,847,549 | $ | 362,592,153 | |||||
| Ottawa Bancorp, Inc. & Subsidiary | ||||||||
| Consolidated Statements of Operations | ||||||||
| Three Months Ended March 31, 2026 and 2025 | ||||||||
| (Unaudited) | ||||||||
| Three Months Ended | ||||||||
| March 31, | ||||||||
| 2026 | 2025 | |||||||
| Interest and dividend income: | ||||||||
| Interest and fees on loans | $ | 4,135,339 | $ | 3,791,161 | ||||
| Securities: | ||||||||
| Residential mortgage-backed and related securities | 92,421 | 103,299 | ||||||
| State and municipal securities | 16,120 | 19,027 | ||||||
| Dividends on non-marketable equity securities | 24,500 | 28,500 | ||||||
| Interest-bearing deposits | 206,858 | 192,522 | ||||||
| Total interest and dividend income | 4,475,238 | 4,134,509 | ||||||
| Interest expense: | ||||||||
| Deposits | 1,546,736 | 1,518,972 | ||||||
| Borrowings | 145,094 | 169,420 | ||||||
| Total interest expense | 1,691,830 | 1,688,392 | ||||||
| Net interest income | 2,783,408 | 2,446,117 | ||||||
| Recovery of credit losses - loans | (77,642 | ) | (89,898 | ) | ||||
| Recovery of credit losses – off-balance sheet credit exposures | (2,900 | ) | (2,570 | ) | ||||
| Net interest income after recovery of credit losses | 2,863,950 | 2,538,585 | ||||||
| Other income: | ||||||||
| Gain on sale of loans, net | 31,334 | 21,239 | ||||||
| Loan origination and servicing income | 139,586 | 126,894 | ||||||
| Net origination (amortization) of mortgage servicing rights | 66,121 | (37,808 | ) | |||||
| Customer service fees | 124,005 | 107,223 | ||||||
| Change in cash surrender value of life insurance | (169 | ) | 74 | |||||
| Other | 7,938 | 6,537 | ||||||
| Total other income | 368,815 | 224,159 | ||||||
| Other expenses: | ||||||||
| Salaries and employee benefits | 1,357,168 | 1,207,957 | ||||||
| Directors’ fees | 39,000 | 45,000 | ||||||
| Occupancy | 139,822 | 160,128 | ||||||
| Deposit insurance premium | 41,414 | 45,000 | ||||||
| Legal and professional services | 113,715 | 82,844 | ||||||
| Data processing | 296,490 | 301,461 | ||||||
| Loan expense | 249,603 | 63,529 | ||||||
| Advertising | 20,108 | 41,472 | ||||||
| Other | 140,030 | 202,854 | ||||||
| Total other expenses | 2,397,350 | 2,150,245 | ||||||
| Income before income tax | 835,415 | 612,499 | ||||||
| Income tax expense | 252,684 | 176,977 | ||||||
| Net income | $ | 582,731 | $ | 435,522 | ||||
| Basic earnings per share | $ | 0.26 | $ | 0.19 | ||||
| Diluted earnings per share | $ | 0.26 | $ | 0.19 | ||||
| Dividends per share | $ | 0.11 | $ | 0.11 | ||||
| Ottawa Bancorp, Inc. & Subsidiary | ||||||
| Selected Financial Data and Ratios | ||||||
| (Unaudited) | ||||||
| At or for the | ||||||
| Three Months Ended | ||||||
| March 31, | ||||||
| 2026 | 2025 | |||||
| Performance Ratios: | ||||||
| Return on average assets (5) | 0.64 | % | 0.49 | % | ||
| Return on average stockholders' equity (5) | 5.76 | 4.34 | ||||
| Average stockholders' equity to average assets | 11.15 | 11.36 | ||||
| Stockholders' equity to total assets at end of period | 10.88 | 11.44 | ||||
| Net interest rate spread (1) (5) | 3.07 | 2.76 | ||||
| Net interest margin (2) (5) | 3.25 | 2.93 | ||||
| Other expense to average assets | 0.66 | 0.61 | ||||
| Efficiency ratio (3) | 76.05 | 80.4 | ||||
| Dividend payout ratio | 42.92 | 61.50 | ||||
| At or for the | At or for the | |||||||
| Three Months Ended | Twelve Months Ended | |||||||
| March 31, | December 31, | |||||||
| 2026 | 2025 | |||||||
| Regulatory Capital Ratios (4): | ||||||||
| Total risk-based capital (to risk-weighted assets) | 16.47 | % | 16.78 | % | ||||
| Tier 1 core capital (to risk-weighted assets) | 15.22 | 15.52 | ||||||
| Common equity Tier 1 (to risk-weighted assets) | 15.22 | 15.52 | ||||||
| Tier 1 leverage (to adjusted total assets) | 11.36 | 11.49 | ||||||
| Asset Quality Ratios: | ||||||||
| Net charge-offs to average gross loans outstanding | 0.02 | 0.01 | ||||||
| Allowance for credit losses on loans to gross loans outstanding | 1.30 | 1.35 | ||||||
| Non-performing loans to gross loans (6) | 0.34 | 0.38 | ||||||
| Non-performing assets to total assets (6) | 0.29 | 0.33 | ||||||
| Other Data: | ||||||||
| Book Value per common share | $ | 17.05 | $ | 17.27 | ||||
| Tangible Book Value per common share (7) | $ | 16.77 | $ | 16.99 | ||||
| Number of full-service offices | 3 | 3 | ||||||
| (1) Represents the difference between the weighted average yield on average interest-earning assets and the weighted average cost of funds on average interest-bearing liabilities. | ||||||||
| (2) Represents net interest income as a percent of average interest-earning assets. | ||||||||
| (3) Represents total other expenses divided by the sum of net interest income and total other income. | ||||||||
| (4) Ratios are for OSB Community Bank. | ||||||||
| (5) Annualized. | ||||||||
| (6) Non-performing assets consist of non-performing loans, foreclosed real estate and other foreclosed assets. Non-performing loans consist of all loans 90 days or more past due and all loans no longer accruing interest. (7) Non-GAAP measure. Excludes goodwill. | ||||||||
Contact: Craig Hepner
President and Chief Executive Officer
(815) 366-5437
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