Company: OSBC
Filing Date: 2025-02-26
Form Type: 425
Source: 0000357173-25-000023
Chunk: 5

Company: OLD SECOND BANCORP INC
Filing Date: 2025-02-26
Form: 425
Chunk 5
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Q:Got it. Okay. And if we do see deal closed third quarter, do you have a targeted conversion date?

Bradley Adams - EVP, Chief Operating & Chief Financial Officer, Old Second Bancorp, Inc.

Bradley Adams - EVP, Chief Operating & Chief Financial Officer, Old Second Bancorp, Inc.

Q:Got it. Okay. And then just on the margin front, the projected impact. So, net of the planned balance sheet restructuring, I just want to get an idea of how you expect that to trend and where you think you'll add?

Bradley Adams - EVP, Chief Operating & Chief Financial Officer, Old Second Bancorp, Inc.

I don't expect this deal to be dilutive to our margin as reported in the fourth quarter by very much. Some of that will depend on what shakes out with interest rates over the next few months and what kind of execution we get on various trades. But plus or minus 5 to 10 basis points, it should look relatively the same.

And I think what's interesting here is that this transaction is obviously accretive to earnings as we project. It is not dilutive to margin and the marks are relatively modest based on things that we've been looking at over the last year, that's a relatively rare animal. And we're extremely excited to move forward with it.

Q:Okay. Got it. And if I could just sneak one more in. On Slide 10, looking at the net charge-off history, do you expect this loss history to be mirrored at Old Second, say, looks like an average of 1% charge-offs?

Bradley Adams - EVP, Chief Operating & Chief Financial Officer, Old Second Bancorp, Inc.

The nature of this business is going to continue as it is. Darin has proven that he knows how to run this business, and I don't expect it to change. So, I think that what we found is that there's a high degree of predictability here. And what we've offered in this slide is a proxy that shows what investors can expect and that is mainly the Fred data as it relates to other consumer, which is consumer lending ex credit cards. So that gives investors an idea of what this business looks like, and you can also see the corresponding yields.

The net result of that is an exceptionally attractive risk-adjusted return profile. I don't expect anything to change, some investors may have questions on whether or not we expect losses or consumer lending being particularly scary at some point over the next