While the broader market has struggled with the S&P 500 down 1.3% since September 2025, Old Second Bancorp has surged ahead as its stock price has climbed by 11.4% to $19.61 per share. This was partly due to its solid quarterly results, and the run-up might have investors contemplating their next move.
Is it too late to buy OSBC? Find out in our full research report, it’s free.
Why Does Old Second Bancorp Spark Debate?
Dating back to 1871 as one of the Chicago area's longest-standing financial institutions, Old Second Bancorp (NASDAQ: OSBC) is an Illinois-based community bank offering deposit services, commercial and consumer loans, wealth management, and mortgage products through its 53 branch locations.
Two Positive Attributes:
1. Net Interest Income Skyrockets, Fueling Growth Opportunities
While bank generate revenue from multiple sources, investors view net interest income as a cornerstone - its predictable, recurring characteristics stand in sharp contrast to the volatility of one-time fees.
Old Second Bancorp’s net interest income has grown at a 26.1% annualized rate over the last five years, much better than the broader banking industry and faster than its total revenue. Its growth was driven by both an increase in its outstanding loans and net interest margin, which represents how much a bank earns in relation to its outstanding loan book.
2. Elite Net Interest Margin Powers Best-In-Class Loan Book
Net interest margin (NIM) serves as a critical gauge of a bank's fundamental profitability by showing the spread between interest income and interest expenses. It's essential for understanding whether a firm can sustainably generate returns from its lending operations.
Over the past two years, we can see that Old Second Bancorp’s net interest margin averaged an elite 4.8%, indicating the company has a high-yielding loan book and a low cost of funds.
One Reason to be Careful:
Lackluster Revenue Growth
We at StockStory place the most emphasis on long-term growth, but within financials, a stretched historical view may miss recent interest rate changes, market returns, and industry trends. Old Second Bancorp’s recent performance shows its demand has slowed significantly as its annualized revenue growth of 8.8% over the last two years was well below its five-year trend. 
Note: Quarters not shown were determined to be outliers, impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.
Final Judgment
Old Second Bancorp’s positive characteristics outweigh the negatives, and with its shares topping the market in recent months, the stock trades at 1× forward P/B (or $19.61 per share). Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
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