QCR Holdings Posts Strong Q3 Earnings, Net Income Jumps 32%

TL;DR

**QCRH is crushing it, with net income up 32% and capital markets revenue soaring – buy the dip!**

AI Summary

QCR Holdings Inc. reported a robust financial performance for the three months ended September 30, 2025, with net income increasing by 32.1% to $36.714 million from $27.785 million in the prior year. Diluted earnings per common share also saw a significant rise to $2.16, up from $1.64 in Q3 2024. Net interest income grew by 8.5% to $64.799 million, compared to $59.722 million in the same period last year, driven by a decrease in interest expense on deposits and FHLB advances. Total assets expanded to $9.568 billion as of September 30, 2025, from $9.026 billion at December 31, 2024, primarily due to a $395.203 million increase in loans/leases receivable held for investment. Noninterest income surged by 35.0% to $36.651 million, largely propelled by a 46.3% increase in capital markets revenue to $23.832 million. The allowance for credit losses slightly decreased to $88.770 million from $89.841 million, while the provision for credit losses increased to $4.305 million from $3.484 million. Stockholders' equity improved to $1.087 billion from $997.387 million at year-end 2024.

Why It Matters

QCRH's strong Q3 performance, marked by a 32.1% increase in net income and significant growth in capital markets revenue, signals robust operational efficiency and strategic success in a competitive banking landscape. For investors, this indicates a healthy return on equity and potential for continued share price appreciation, especially with diluted EPS rising to $2.16. Employees benefit from a growing, profitable company, potentially leading to job security and growth opportunities. Customers may see enhanced services as the bank's financial strength allows for further investment in technology and offerings. In the broader market, QCRH's ability to significantly boost noninterest income, particularly in capital markets, demonstrates resilience and adaptability, potentially setting a positive precedent for regional banks navigating evolving economic conditions.

Risk Assessment

Risk Level: medium — While QCRH shows strong growth, the provision for credit losses increased to $4.305 million for the three months ended September 30, 2025, up from $3.484 million in the prior year, indicating potential future loan quality concerns. Additionally, total liabilities increased to $8.481 billion from $8.029 billion at December 31, 2024, which could expose the company to higher interest rate risk or refinancing challenges.

Analyst Insight

Investors should consider QCRH's strong net income growth and significant capital markets revenue as positive indicators. However, monitor the rising provision for credit losses and overall increase in liabilities. A balanced approach would be to hold existing positions while closely watching upcoming earnings reports for trends in credit quality and liability management.

Financial Highlights

debt To Equity

N/A

revenue

$101.45M

operating Margin

N/A

total Assets

$9.568B

total Debt

N/A

net Income

$36.714M

eps

$2.16

gross Margin

N/A

cash Position

N/A

revenue Growth

N/A

Revenue Breakdown

Key Numbers

• $36.714M — Net Income (Q3 2025) (Increased 32.1% from $27.785M in Q3 2024)
• $2.16 — Diluted EPS (Q3 2025) (Increased from $1.64 in Q3 2024)
• $64.799M — Net Interest Income (Q3 2025) (Increased 8.5% from $59.722M in Q3 2024)
• $9.568B — Total Assets (Sept 30, 2025) (Increased from $9.026B at Dec 31, 2024)
• $36.651M — Total Noninterest Income (Q3 2025) (Increased 35.0% from $27.157M in Q3 2024)
• $23.832M — Capital Markets Revenue (Q3 2025) (Increased 46.3% from $16.290M in Q3 2024)
• $4.305M — Provision for Credit Losses (Q3 2025) (Increased from $3.484M in Q3 2024)
• $1.087B — Stockholders' Equity (Sept 30, 2025) (Increased from $997.387M at Dec 31, 2024)
• 16,838,653 — Common Shares Outstanding (Nov 1, 2025) (Current shares outstanding)
• $7.177B — Loans/leases receivable held for investment (Sept 30, 2025) (Increased from $6.782B at Dec 31, 2024)

Key Players & Entities

• QCR HOLDINGS INC (company) — Registrant
• $36.714 million (dollar_amount) — Net income for Q3 2025
• $27.785 million (dollar_amount) — Net income for Q3 2024
• $2.16 (dollar_amount) — Diluted earnings per common share for Q3 2025
• $1.64 (dollar_amount) — Diluted earnings per common share for Q3 2024
• $64.799 million (dollar_amount) — Net interest income for Q3 2025
• $59.722 million (dollar_amount) — Net interest income for Q3 2024
• $9.568 billion (dollar_amount) — Total assets as of September 30, 2025
• $36.651 million (dollar_amount) — Total noninterest income for Q3 2025
• $23.832 million (dollar_amount) — Capital markets revenue for Q3 2025

FAQ

Risk Factors

• Credit Risk and Loan Portfolio Quality [medium — financial]: The company maintains an allowance for credit losses of $88.770 million, which slightly decreased from $89.841 million. However, the provision for credit losses increased to $4.305 million from $3.484 million, indicating a cautious approach to potential future loan defaults.
• Interest Rate Sensitivity [medium — market]: Fluctuations in interest rates can impact net interest income. While the company reported an 8.5% increase in net interest income driven by lower interest expenses, continued shifts in the interest rate environment could affect future profitability.
• Regulatory Capital Requirements [high — regulatory]: As a financial institution, QCR Holdings Inc. is subject to various regulatory capital requirements. Maintaining adequate capital levels is crucial for compliance and operational stability.
• Cybersecurity and Data Breaches [medium — operational]: Like all financial institutions, QCR Holdings is exposed to risks associated with cybersecurity threats and potential data breaches, which could lead to financial losses and reputational damage.
• Economic Downturn Impact [medium — market]: A significant economic downturn could negatively impact loan demand, increase credit losses, and reduce the value of investment securities, affecting the company's overall financial performance.

Industry Context

QCR Holdings Inc. operates within the highly competitive banking and financial services industry. The sector is characterized by evolving regulatory landscapes, technological advancements, and fluctuating interest rate environments. Banks are increasingly focusing on noninterest income streams, such as capital markets, to diversify revenue and enhance profitability.

Regulatory Implications

As a regulated financial institution, QCR Holdings Inc. must adhere to stringent capital adequacy ratios and other regulatory requirements set forth by bodies like the Federal Reserve and FDIC. Compliance is critical to maintaining operational licenses and market confidence.

What Investors Should Do

1. Monitor Capital Markets Revenue Growth
2. Analyze Provision for Credit Losses Trend
3. Evaluate Net Interest Margin (NIM) Stability
4. Assess Loan Growth Sustainability

Key Dates

• 2025-09-30: Quarterly Financial Results — Reported strong net income growth of 32.1% and a significant increase in diluted EPS, indicating robust operational performance.
• 2025-09-30: Total Assets — Total assets grew to $9.568 billion, primarily driven by an increase in loans/leases receivable, signaling business expansion.
• 2025-09-30: Stockholders' Equity — Stockholders' equity improved to $1.087 billion, reflecting retained earnings and a stronger capital base.
• 2024-12-31: Year-End Financial Position — Provided the baseline for Q3 2025 comparisons, with total assets at $9.026 billion and stockholders' equity at $997.387 million.

Glossary

ACL

Allowance for credit losses, an estimate of the amount of loan and lease receivables that may not be collected. (Indicates the company's provision for potential loan defaults.)

CECL

Current Expected Credit Losses, an accounting standard that requires financial institutions to estimate and reserve for expected credit losses over the life of financial assets. (Governs how the allowance for credit losses is calculated.)

NIM

Net interest margin, a measure of the difference between the income generated by the bank and the income it pays out, expressed as a percentage of its interest-earning assets. (Key profitability metric for banks, reflecting efficiency in lending and borrowing.)

EPS

Earnings per share, the portion of a company's profit allocated to each outstanding share of common stock. (A fundamental measure of a company's profitability on a per-share basis.)

FHLB advances

Advances from the Federal Home Loan Bank, a source of funding for member financial institutions. (A component of the company's borrowings that impacts interest expense.)

OBS

Off-balance sheet, financial obligations or assets that are not recorded on the company's balance sheet. (Relevant for understanding the full scope of financial commitments and risks.)

Year-Over-Year Comparison

Compared to the prior year's comparable period, QCR Holdings Inc. has demonstrated substantial growth, with net income up 32.1% and diluted EPS rising to $2.16. Net interest income saw a healthy 8.5% increase, while noninterest income surged by 35.0%, largely due to a significant boost in capital markets revenue. Total assets have expanded, and stockholders' equity has improved, indicating a stronger financial position and successful business operations.

Key Financial Figures

• $1.00 — ange on which registered Common Stock, $1.00 Par Value QCRH The Nasdaq Global Ma

Filing Documents

• qcrh-20250930x10q.htm (10-Q) — 11527KB
• qcrh-20250930xex31d1.htm (EX-31.1) — 9KB
• qcrh-20250930xex31d2.htm (EX-31.2) — 9KB
• qcrh-20250930xex32d1.htm (EX-32.1) — 6KB
• qcrh-20250930xex32d2.htm (EX-32.2) — 7KB
• 0001104659-25-108483.txt ( ) — 43770KB
• qcrh-20250930.xsd (EX-101.SCH) — 100KB
• qcrh-20250930_cal.xml (EX-101.CAL) — 128KB
• qcrh-20250930_def.xml (EX-101.DEF) — 531KB
• qcrh-20250930_lab.xml (EX-101.LAB) — 832KB
• qcrh-20250930_pre.xml (EX-101.PRE) — 728KB
• qcrh-20250930x10q_htm.xml (XML) — 14078KB

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 10 Note 1. Summary of Significant Accounting Policies 10 Note 2. Investment Securities 12 Note 3. Loans/Leases Receivable 17 Note 4. Securitizations and Variable Interest Entities 26 Note 5. Derivatives and Hedging Activities 26 Note 6. Other Borrowings 29 Note 7. Subordinated Notes 30 Note 8. Income Taxes 31 Note 9. Earnings Per Share 32 Note 10. Fair Value 32 Note 11. Business Segment Information 35 Note 12. Regulatory Capital Requirements 37 Note 13. Commitments 38 Note 14. Subsequent Event 38 Item 2

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations Introduction 39 General 39 Critical Accounting Policies and Critical Accounting Estimates 39 Executive Overview 39 Strategic Financial Metrics 41 Strategic Developments 42 GAAP to Non-GAAP Reconciliations 43 Net Interest Income - (Tax Equivalent Basis) 45 Results of Operations 50 2 Table of Contents Interest Income 50 Interest Expense 50 Provision for Credit Losses 50 Noninterest Income 51 Noninterest Expense 54 Income Taxes 56 Financial Condition 57 Investment Securities 57 Loans/Leases 58 Allowance for Credit Losses on Loans/Leases and OBS Exposures 60 Nonperforming Assets 62 Deposits 63 Borrowings 63 Stockholders' Equity 65 Liquidity and Capital Resources 66 Special Note Concerning Forward-Looking Statements 67 Item 3

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 69 Item 4

Controls and Procedures

Controls and Procedures 71 Part II OTHER INFORMATION Item 1

Legal Proceedings

Legal Proceedings 72 Item 1A

Risk Factors

Risk Factors 72 Item 2 Unregistered Sales of Equity Securities and Use of Proceeds 72 Item 3 Defaults Upon Senior Securities 72 Item 4 Mine Safety Disclosures 72 Item 5 Other Information 72 Item 6 Exhibits 73

Signatures

Signatures Throughout this Quarterly Report on Form 10-Q, we use certain acronyms and abbreviations, as defined in Note 1 to the Consolidated Financial Statements. 3 Table of Contents QCR HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (UNAUDITED) As of September 30, 2025 and December 31, 2024 September 30, December 31, 2025 2024 (dollars in thousands) Assets Cash and due from banks $ 77,581 $ 91,732 Federal funds sold 22,200 27,150 Interest-bearing deposits at financial institutions 137,833 143,442 Securities held to maturity, at amortized cost (including securities pledged on other borrowings of $ 200,283 and $ 0 , respectively, net of allowance for credit losses) 954,115 835,797 Securities available for sale, at fair value 271,349 281,109 Securities trading, at fair value 83,225 83,529 Total securities 1,308,689 1,200,435 Loans receivable held for sale 1,457 2,143 Loans/leases receivable held for investment 7,177,464 6,782,261 Gross loans/leases receivable 7,178,921 6,784,404 Less allowance for credit losses ( 88,770 ) ( 89,841 ) Net loans/leases receivable 7,090,151 6,694,563 Bank-owned life insurance 112,049 109,575 Premises and equipment, net 193,170 159,153 Restricted investment securities 35,810 35,412 Other real estate owned, net — 661 Goodwill 138,595 138,595 Intangibles 9,077 11,061 Derivatives 207,775 186,781 Other assets 235,372 227,470 Total assets $ 9,568,302 $ 9,026,030 Liabilities and Stockholders' Equity Liabilities: Deposits: Noninterest-bearing $ 931,774 $ 921,160 Interest-bearing 6,448,294 6,140,027 Total deposits 7,380,068 7,061,187 Short-term borrowings 2,850 1,800 Federal Home Loan Bank advances 290,383 285,383 Other borrowings 130,609 — Subordinated notes 234,027 233,489 Junior subordinated debentures 48,958 48,860 D

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) September 30, 2025 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation : The interim unaudited Consolidated Financial Statements contained herein should be read in conjunction with the audited Consolidated Financial Statements and accompanying notes to the Consolidated Financial Statements for the fiscal year ended December 31, 2024, included in the Company's Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the SEC on February 28, 2025. Accordingly, footnote disclosures, which would substantially duplicate the disclosures contained in the audited Consolidated Financial Statements, have been omitted. The financial information of the Company included herein has been prepared in accordance with GAAP for interim financial reporting and has been prepared pursuant to the rules and regulations for reporting on Form 10-Q and Rule 10-01 of Regulation S-X. Such information reflects all adjustments (consisting of normal recurring adjustments) that are, in the opinion of management, necessary for a fair presentation of the financial position and results of operations for the periods presented. Any differences appearing between the numbers presented in financial statements and management's discussion and analysis are due to rounding. The results of the interim period ended September 30, 2025 are not necessarily indicative of the results expected for the year ending December 31, 2025, or for any other period. The acronyms and abbreviations identified below are used throughout this Quarterly Report on Form 10-Q. It may be helpful to refer back to this page as you read this report. ACL: Allowance for credit losses FTEs: Full-time equivalents AFS: Available for sale GAAP: Generally Accepted Accounting Principles Allowance: Allowance for credit losses GB: Guaranty Bank AOCI: Accumulated other comprehensive income (loss) GFED: Guaranty Federal Bancshares, Inc. ASC:

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