QCR Holdings, Inc.

What they do

QCRH runs four wholly-owned banking subsidiaries: Quad City Bank & Trust in Bettendorf, Iowa; Cedar Rapids Bank & Trust in Cedar Rapids, Iowa; Community State Bank in Ankeny, Iowa; and Guaranty Bank in Springfield, Missouri. The banks provide commercial and consumer banking plus trust and asset management services in the Quad Cities, Cedar Rapids, Waterloo/Cedar Falls, Des Moines/Ankeny and Springfield/Joplin markets. A subsidiary of QCBT, m2, is based in Waukesha, Wisconsin and lends and leases machinery and equipment to C&I businesses, though the company announced in September 2024 it would stop offering new loans and leases through m2.

Revenue drivers

• Commercial banking (four bank segments) — Net interest income and fee income from commercial and consumer lending and deposits; the four banks reported segment assets at December 31, 2025 of $2.71B (QCBT with m2), $2.86B (CRBT), $1.72B (CSB) and $2.41B (GB).
• Capital markets / LIHTC lending — Tax-credit lending and loan offtake activity; second-quarter 2026 capital markets revenue from LIHTC loan production was $16.7 million, up 69% year over year.
• Wealth management and trust — Trust and asset management services at the bank subsidiaries; assets under management rose 9% and revenue rose 7% on a linked-quarter basis in second-quarter 2026.
• m2 Equipment Finance — Direct financing leases and equipment financing agreements to C&I businesses through a QCBT subsidiary; the company is running off this portfolio after discontinuing new originations in September 2024.

Recent performance

For the second quarter of 2026, QCRH reported net income of $36.3 million, or $2.19 diluted EPS, versus $33.4 million and $1.99 in first-quarter 2026 and $29.0 million and $1.71 in second-quarter 2025. Return on average assets was 1.51% and the efficiency ratio improved 310 basis points to 54.6%. Total loans grew $216.9 million, or 12% annualized, excluding $443.6 million of LIHTC loan offtake transactions and planned m2 runoff; traditional loan growth was 7% annualized on the same basis. Noninterest income was $29.4 million, up from $23.0 million in the prior quarter, and the company repurchased 149,639 shares at an average price of $90.01.

Strategy

Management is pursuing an asset- and capital-light model, executing LIHTC loan offtake transactions including a Freddie Mac permanent loan securitization and a construction loan portfolio sale totaling $443.6 million in the second quarter. It is winding down new m2 Equipment Finance originations and completed its second core conversion during the quarter. The company repurchased shares opportunistically and reported criticized loans to total loans at the lowest level since fourth-quarter 2019. Wealth management and capital markets are positioned as growth engines, alongside continued traditional commercial lending in its Iowa and Missouri markets.

Risks

• Interest rate risk — The 10-K lists interest rate risk as a principal risk, and the company describes its balance sheet as liability sensitive, with cost of funds falling to 2.61% in second-quarter 2026 from 3.01% a year earlier as the Federal Reserve cut rates.
• Commercial real estate credit — The 10-K specifically cites the ability to manage credit risk, including in the commercial real estate portfolio, and maintain an adequate allowance for credit losses.
• Loan portfolio concentration — The 10-K identifies concentrations within the loan portfolio as a material credit and lending risk.
• Regulatory and legislative change — The 10-K cites the extensive regulatory framework applicable to the company and the impact of recent and future legislative and regulatory changes.

Outlook

Management reaffirmed gross loan growth guidance of 10% to 15% annualized for the final two quarters of 2026, saying strong pipelines should let increased lending activity fully offset the near-term net interest income impact of LIHTC offtake transactions. It expects those transactions to expand capital markets revenue opportunities over time.