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EX - 99.1 2 osbc - 20210721 ex9912268f5.htm EX - 99.1 Old Second Bancorp , Inc. ( NASDAQ : OSBC ) Contact : Bradley S. Adams Chief Financial Officer ( 630 ) 906-5484 Exhibit 99.1 For Immediate Release July 21 , 2021 Old Second Reports Second Quarter Net Income of $ 8.8 million , or $ 0.30 per Diluted _ Share AURORA , IL , July 21 , 2021 Old Second Bancorp , Inc. ( the “ Company , ” “ we , ” “ us , ” and “ our ” ) ( NASDAQ : OSBC ) , the parent company of Old Second National Bank ( the “ Bank ” ) , today announced financial results for the second quarter of 2021. Our net income was $ 8.8 million , or $ 0.30 per diluted share , for the second quarter of 2021 , compared to net income of $ 11.9 million , or $ 0.40 per diluted share , for the first quarter of 2021 , and net income of $ 9.2 million , or $ 0.31 per diluted share , for the second quarter of 2020 . Net income for the second quarter of 2021 reflected a $ 3.5 million pre - tax release of provision for credit losses , compared to a $ 3.0 million pre - tax release in the first quarter of 2021 , and a $ 2.1 million pre - tax provision expense in the second quarter of 2020. Mortgage banking income totaled $ 1.6 million in the second quarter of 2021 , compared to $ 5.7 million in the first quarter of 2021 , and $ 5.1 million in the second quarter of 2020. Mortgage servicing rights experienced a mark to market loss of $ 1.0 million during the second quarter of 2021 , compared to a $ 1.1 million gain in the prior quarter and a $ 445,000 loss in the second quarter of Net gain on sales of mortgage loans totaled $ 1.9 million in the second quarter of 2021 , compared to $ 3.7 million in the first quarter of 2021 , and $ 4.6 million in the second quarter of 2020 , as mortgage origination and refinancing volumes declined in the current period . 2020 . Operating Results • Second quarter 2021 net income was $ 8.8 million , reflecting a decrease in earnings of $ 3.1 million from the first quarter of 2021 , and a decrease of $ 418,000 from the second quarter of 2020 . Net interest and dividend income was $ 22.0 million for the second quarter of 2021 , a decrease of $ 1.6 million , or 6.8 % , from the first quarter of 2021 , and a decrease of $ 754,000 , or 3.3 % , from second quarter of 2020 . Interest and dividend income for the second quarter of 2021 was $ 24.2 million , or $ 1.2 million less than the first quarter of 2021 , and $ 1.5 million less than the second quarter of 2020 , primarily due to a decrease in market interest rates over the past year . Interest and dividend income was favorably impacted by loan fees earned on forgiven Paycheck Protection Program ( " PPP " ) loans during the first and second quarters of 2021. We originated 746 PPP loans totaling $ 136.7 million in 2020 , and as of June 30 , 2021 , $ 11.6 million on 35 PPP loans originated during the first round of the PPP loan program remained outstanding . During the first and second quarters of 2021 , we originated $ 62.3 million , or 574 loans , under the second round of the PPP loan program , of which $ 58.6 million , or 483 loans , remain outstanding as of June 30 , 2021. Net loan interest and fee income recorded in 2021 year to date on all PPP loans totaled $ 1.6 million , and approximately $ 2.3 million of net PPP loan fees remain unearned as of June 30 , 2021 . Interest expense for the second quarter of 2021 totaled $ 2.2 million , compared to $ 1.8 million for the first quarter of 2021 , and $ 3.0 million for the second quarter of 2020. The $ 393,000 increase in interest expense in the second quarter of 2021 , compared to the first quarter of 2021 , was primarily due to the April 6 , 2021 , issuance of $ 60.0 million of 3.50 % Fixed - to - Floating Rate Subordinated Notes due April 15 , 2031 , which bear interest at a fixed annual rate of 3.50 % until April 14 , 2026 . The reduction in interest expense in the year over year period was due to a decrease in market interest rates , which impacted all interest bearing deposit categories . We recorded a $ 3.5 million release of provision expense in the second quarter of 2021 , compared to a $ 3.0 million release of provision expense in the first quarter of 2021 , and a $ 2.1 million provision for credit losses in the second quarter of 2020 , as the projected impact of the COVID - 19 pandemic on future credit losses is currently anticipated to be less than prior projections . Our allowance for credit