EX-99.1 2 exhibit99_13q2024pressrele.htm EX-99.1 Document

Exhibit 99.1
nicoletbanksharesa08.jpg


FOR IMMEDIATE RELEASE
 .
NICOLET BANKSHARES, INC. ANNOUNCES THIRD QUARTER 2024 RESULTS

•Net income $33 million for third quarter 2024, compared to net income of $29 million in prior quarter, and net income of $17 million for third quarter 2023
•Net income of $90 million or adjusted net income (non-GAAP) of $87 million for the first nine months of 2024, compared to net income of $31 million or adjusted net income (non-GAAP) of $73 million for the first nine months of 2023
•Tangible common equity to tangible assets increased 64 bps to 9.21% at quarter end due to strong core earnings and a significant reduction in unrealized losses in the securities portfolio from lower expected interest rates
•Asset quality remains solid, as nonperforming assets declined to 31 bps – the lowest level in more than three years; annualized net charge-offs remain negligible at 2 bps of loans

Green Bay, Wisconsin, October 15, 2024 - Nicolet Bankshares, Inc. (NYSE: NIC) (“Nicolet”) announced third quarter 2024 net income of $33 million and earnings per diluted common share of $2.10, compared to net income of $29 million and earnings per diluted common share of $1.92 for second quarter 2024, and net income of $17 million and earnings per diluted common share of $1.14 for third quarter 2023. Net income for the nine months ended September 30, 2024 was $90 million and earnings per diluted common share of $5.84, compared to net income of $31 million and earnings per diluted common share of $2.05 for the nine months ended September 30, 2023.

Net income reflected certain non-core items and the related tax effect of each, including the first quarter 2023 balance sheet repositioning and third quarter 2023 change in Wisconsin state tax law (as detailed in the Reconciliation of Non-GAAP Financial Measures table below), as well as gains / (losses) on other assets and investments in all periods. For the nine months ended September 30, 2024, these non-core items positively impacted earnings per diluted common share $0.19, and negatively impacted earnings per diluted common share $2.82 for the nine months ended September 30, 2023.

“The third quarter produced strong results across all revenue lines, and demonstrated what happens when almost 1,000 people show up every day to make a difference,” said Mike Daniels, Chairman, President, and CEO of Nicolet. “Financial results were impressive with quarterly return on average assets of 1.50% and return on average tangible common equity of 17.77%. We saw growth in loans and core deposits. Revenue was up across wealth, mortgage, and all other fee income areas. And our net interest margin continued its upward trajectory as we were able to keep deposit and funding costs relatively stable during the quarter.”

“Furthermore, our credit quality remains exceptional as nonperforming assets fell to their lowest level in years. This not only speaks to the team’s ability to execute within Nicolet’s consistent credit culture, but also to the strength and resilience of our commercial customer base across the Upper Midwest. Despite facing higher interest rates, rising input costs due to inflation, and the challenges of finding qualified workers, our customers have shown their ability to adapt in this economy. Nicolet’s message of shared success is resonating within our walls and in the communities we serve,” Daniels continued.

Balance Sheet Review
At September 30, 2024, period end assets were $8.6 billion, an increase of $80 million (1%) from June 30, 2024, mostly from loan growth and improvements in the fair value of the available for sale securities portfolio. Total loans increased $28 million from June 30, 2024, while the securities portfolio increased $26 million from June 30, 2024, mostly due to the positive fair value movements. Total deposits of $7.3 billion at September 30, 2024, increased $19 million from June 30, 2024, the net of a $75 million increase in noninterest-bearing demand and a $56 million decrease in interest-bearing deposits. Total capital was $1.1 billion at September 30, 2024, an increase of $58 million over June 30, 2024, with solid earnings and improvements in the securities portfolio valuation partly offset by the quarterly common stock dividend.
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Asset Quality
Nonperforming assets were $26 million and represented 0.31% of total assets at September 30, 2024, compared to $29 million or 0.34% of total assets at June 30, 2024, and $32 million or 0.37% of total assets at September 30, 2023. The allowance for credit losses-loans was $66 million and represented 1.00% of total loans at September 30, 2024, compared to $65 million (or 1.00% of total loans) at June 30, 2024, and $63 million (or 1.01% of total loans) at September 30, 2023. Asset quality trends remain solid and loan net charge-offs were negligible.

Income Statement Review - Quarter
Net income was $33 million for third quarter 2024, compared to net income of $29 million for second quarter 2024.

Net interest income was $68 million for third quarter 2024, up $3 million from second quarter 2024. Interest income increased $4 million mostly due to the repricing of new and renewed loans in a higher interest rate environment, as well as solid loan growth, while interest expense increased $1 million due to both higher average balances and higher rates. The net interest margin for third quarter 2024 was 3.44%, up 9 bps from 3.35% for second quarter 2024. The yield on interest-earning assets increased 7 bps (to 5.68%) mostly due to higher average rates from the repricing of the loan portfolio, while the cost of funds increased 2 bps (to 3.11%) for third quarter 2024.

Noninterest income of $22 million for third quarter 2024 increased $3 million over second quarter 2024, with increases in most noninterest income categories. Wealth income increased $0.4 million on growth in assets under management (due to both net new accounts and positive fair value changes), while net mortgage income grew $0.2 million mostly from higher gains on sale. Net asset gains and deferred compensation plan asset market valuations during third quarter 2024 were attributable to positive movements in the market.

Noninterest expense of $49 million for third quarter 2024 increased $2 million over second quarter 2024. Personnel expense increased $3 million over second quarter 2024, including higher incentives commensurate with solid earnings, higher salaries, and the offsetting market value change in the deferred compensation plan liabilities. Non-personnel expenses combined decreased $0.4 million from second quarter 2024 on lower marketing (due to timing of marketing campaigns) and lower other noninterest expense (due to the board equity retainer granted in second quarter), partly offset by higher data processing.

About Nicolet Bankshares, Inc.
Nicolet Bankshares, Inc. is the bank holding company of Nicolet National Bank, a growing, full-service, community bank providing services ranging from commercial, agricultural and consumer banking to wealth management and retirement plan services. Founded in Green Bay in 2000, Nicolet National Bank operates branches primarily in Wisconsin, Michigan, and Minnesota. More information can be found at www.nicoletbank.com.

Use of Non-GAAP Financial Measures
This communication contains non-GAAP financial measures, such as non-GAAP adjusted net income, non-GAAP adjusted earnings per diluted common share, tangible book value per common share, return on average tangible common equity, and tangible common equity to tangible assets. Management believes such measures to be helpful to management, investors and others in understanding Nicolet’s results of operations and financial position. When non-GAAP financial measures are used, the comparable GAAP financial measures, as well as the reconciliation of the non-GAAP measures to the GAAP financial measures, are provided. See “Reconciliation of Non-GAAP Financial Measures (Unaudited)” below. The non-GAAP net income measure and related reconciliation provide information useful to investors in understanding the operating performance and trends of Nicolet and also aid investors in comparing Nicolet’s financial performance to the financial performance of peer banks. Management considers non-GAAP financial ratios to be critical metrics with which to analyze and evaluate financial condition and capital strengths. While non-GAAP financial measures are frequently used by stakeholders in the evaluation of a company, they have limitations as analytical tools and should not be considered in isolation or as a substitute for analyses of results as reported under GAAP.





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Nicolet Bankshares, Inc.
Consolidated Balance Sheets (Unaudited)
(In thousands, except share data)
9/30/20246/30/20243/31/202412/31/20239/30/2023
Assets
Cash and due from banks$124,076 $109,674 $81,677 $129,898 $109,414 
Interest-earning deposits303,908 298,856 345,747 361,533 436,466 
Cash and cash equivalents427,984 408,530 427,424 491,431 545,880 
Certificates of deposit in other banks3,189 3,924 5,639 6,374 7,598 
Securities available for sale, at fair value825,907 799,937 803,963 802,573 793,826 
Other investments60,443 60,796 60,464 57,560 58,367 
Loans held for sale11,121 9,450 5,022 4,160 6,500 
Loans6,556,840 6,529,134 6,397,617 6,353,942 6,239,257 
Allowance for credit losses - loans(65,785)(65,414)(64,347)(63,610)(63,160)
Loans, net
6,491,055 6,463,720 6,333,270 6,290,332 6,176,097 
Premises and equipment, net123,585 120,988 119,962 118,756 117,744 
Bank owned life insurance (“BOLI”)
185,011 171,972 170,746 169,392 168,223 
Goodwill and other intangibles, net389,727 391,421 393,183 394,366 396,208 
Accrued interest receivable and other assets119,096 126,279 126,989 133,734 145,719 
Total assets$8,637,118 $8,557,017 $8,446,662 $8,468,678 $8,416,162 
Liabilities and Stockholders' Equity
Liabilities:
Noninterest-bearing demand deposits
$1,839,617 $1,764,806 $1,665,229 $1,958,709 $2,020,074 
Interest-bearing deposits
5,420,380 5,476,272 5,500,503 5,239,091 5,162,314 
Total deposits
7,259,997 7,241,078 7,165,732 7,197,800 7,182,388 
Short-term borrowings— — — — — 
Long-term borrowings161,210 162,433 162,257 166,930 197,754 
Accrued interest payable and other liabilities66,584 62,093 55,018 64,941 61,559 
Total liabilities7,487,791 7,465,604 7,383,007 7,429,671 7,441,701 
Stockholders' Equity:
Common stock151 150 149 149 147 
Additional paid-in capital647,934 639,159 636,621 633,770 626,348 
Retained earnings
535,638 507,366 482,295 458,261 431,317 
Accumulated other comprehensive income (loss)
(34,396)(55,262)(55,410)(53,173)(83,351)
Total stockholders' equity1,149,327 1,091,413 1,063,655 1,039,007 974,461 
Total liabilities and stockholders' equity$8,637,118 $8,557,017 $8,446,662 $8,468,678 $8,416,162 
Common shares outstanding15,104,381 14,945,598 14,930,549 14,894,209 14,757,565 


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Nicolet Bankshares, Inc.
Consolidated Statements of Income (Unaudited)
For the Three Months EndedFor the Nine Months Ended
(In thousands, except per share data)
9/30/20246/30/20243/31/202412/31/20239/30/20239/30/20249/30/2023
Interest income:
Loans, including loan fees$100,824 $97,975 $93,648 $90,265 $87,657 $292,447 $250,890 
Taxable investment securities5,211 5,056 4,557 4,737 4,351 14,824 13,445 
Tax-exempt investment securities1,095 1,152 1,238 1,394 1,424 3,485 4,637 
Other interest income5,492 4,695 4,588 7,149 6,452 14,775 10,345 
Total interest income112,622 108,878 104,031 103,545 99,884 325,531 279,317 
Interest expense:
Deposits42,060 41,386 38,990 36,583 34,964 122,436 89,241 
Short-term borrowings2 — — — 474 2 4,794 
Long-term borrowings2,194 2,150 2,234 2,680 2,972 6,578 8,048 
Total interest expense44,256 43,536 41,224 39,263 38,410 129,016 102,083 
Net interest income68,366 65,342 62,807 64,282 61,474 196,515 177,234 
Provision for credit losses
750 1,350 750 1,000 450 2,850 3,990 
Net interest income after provision for credit losses
67,616 63,992 62,057 63,282 61,024 193,665 173,244 
Noninterest income:
Wealth management fee income7,085 6,674 6,485 6,308 6,057 20,244 17,439 
Mortgage income, net
2,853 2,634 1,364 1,856 2,020 6,851 5,308 
Service charges on deposit accounts
1,913 1,813 1,581 1,475 1,492 5,307 4,501 
Card interchange income
3,564 3,458 3,098 3,306 3,321 10,120 9,685 
BOLI income
1,455 1,225 1,347 1,161 1,090 4,027 3,363 
Asset gains (losses), net
1,177 616 1,909 5,947 31 3,702 (38,755)
Deferred compensation plan asset market valuations1,162 169 59 949 (457)1,390 988 
LSR income, net1,090 1,117 1,134 1,027 1,108 3,341 3,398 
Other noninterest income
2,079 1,903 2,445 2,405 1,879 6,427 5,611 
Total noninterest income
22,378 19,609 19,422 24,434 16,541 61,409 11,538 
Noninterest expense:
Personnel expense
28,937 26,285 26,510 26,937 23,944 81,732 72,172 
Occupancy, equipment and office
8,826 8,681 8,944 9,567 9,027 26,451 26,655 
Business development and marketing
1,823 2,040 2,142 1,854 1,869 6,005 5,936 
Data processing
4,535 4,281 4,270 7,043 4,643 13,086 12,849 
Intangibles amortization
1,694 1,762 1,833 1,842 1,986 5,289 6,230 
FDIC assessments990 990 1,033 950 1,500 3,013 3,049 
Merger-related expense— — — — — — 189 
Other noninterest expense
2,343 2,814 2,415 2,103 2,769 7,572 8,490 
Total noninterest expense
49,148 46,853 47,147 50,296 45,738 143,148 135,570 
Income before income tax expense40,846 36,748 34,332 37,420 31,827 111,926 49,212 
Income tax expense
8,330 7,475 6,542 6,759 14,669 22,347 18,357 
Net income$32,516 $29,273 $27,790 $30,661 $17,158 $89,579 $30,855 
Earnings per common share:
Basic
$2.16 $1.96 $1.86 $2.07 $1.16 $5.99 $2.10 
Diluted
$2.10 $1.92 $1.82 $2.02 $1.14 $5.84 $2.05 
Common shares outstanding:
Basic weighted average
15,05214,93714,90714,82314,74014,96614,716
Diluted weighted average
15,47915,27615,24915,14215,10015,33015,044
 
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Nicolet Bankshares, Inc.
Consolidated Financial Summary (Unaudited)
For the Three Months EndedFor the Nine Months Ended
(In thousands, except share & per share data)
9/30/20246/30/20243/31/202412/31/20239/30/20239/30/20249/30/2023
Selected Average Balances:
Loans
$6,542,532 $6,496,732 $6,398,838 $6,263,971 $6,230,336 $6,479,598 $6,223,396 
Investment securities
873,212 881,190 884,775 897,437 962,607 879,701 1,177,762 
Interest-earning assets
7,824,773 7,733,097 7,629,120 7,683,495 7,676,895 7,729,346 7,667,911 
Cash and cash equivalents431,632 374,176 364,375 558,473 513,250 390,213 283,032 
Goodwill and other intangibles, net
390,453 392,171 393,961 395,158 397,052 392,189 399,100 
Total assets
8,596,812 8,481,186 8,380,595 8,415,169 8,417,456 8,486,602 8,404,999 
Deposits
7,247,321 7,183,777 7,112,971 7,189,650 7,156,577 7,181,597 7,052,978 
Interest-bearing liabilities
5,653,259 5,658,642 5,509,882 5,358,445 5,385,292 5,607,430 5,329,540 
Stockholders’ equity (common)1,118,242 1,070,379 1,048,596 996,745 983,133 1,079,215 973,509 
Selected Ratios: (1)
Book value per common share$76.09 $73.03 $71.24 $69.76 $66.03 $76.09 $66.03 
Tangible book value per common share (2)
$50.29 $46.84 $44.91 $43.28 $39.18 $50.29 $39.18 
Return on average assets
1.50 %1.39 %1.33 %1.45 %0.81 %1.41 %0.49 %
Return on average common equity
11.57 11.00 10.66 12.20 6.92 11.09 4.24 
Return on average tangible common equity (2)
17.77 17.36 17.07 20.22 11.62 17.42 7.18 
Average equity to average assets
13.01 12.62 12.51 11.84 11.68 12.72 11.58 
Stockholders’ equity to assets
13.31 12.75 12.59 12.27 11.58 13.31 11.58 
Tangible common equity to tangible assets (2)
9.21 8.57 8.33 7.98 7.21 9.21 7.21 
Net interest margin
3.44 3.35 3.26 3.30 3.16 3.35 3.07 
Efficiency ratio
54.57 55.24 58.34 60.41 58.27 55.98 59.16 
Effective tax rate
20.39 20.34 19.06 18.06 46.09 19.97 37.30 
Selected Asset Quality Information:
Nonaccrual loans
$25,565 $27,838 $26,677 $26,625 $29,507 $25,565 $29,507 
Other real estate owned
859 1,147 1,245 1,267 2,031 859 2,031 
Nonperforming assets
$26,424 $28,985 $27,922 $27,892 $31,538 $26,424 $31,538 
Net loan charge-offs (recoveries)
$379 $283 $13 $550 $101 $675 $319 
Allowance for credit losses-loans to loans
1.00 %1.00 %1.01 %1.00 %1.01 %1.00 %1.01 %
Net charge-offs to average loans (1)
0.02 0.02 0.00 0.03 0.01 0.01 0.01 
Nonperforming loans to total loans
0.39 0.43 0.42 0.42 0.47 0.39 0.47 
Nonperforming assets to total assets
0.31 0.34 0.33 0.33 0.37 0.31 0.37 
Stock Repurchase Information:
Common stock repurchased ($) (3)
$— $— $— $— $— $— $1,519 
Common stock repurchased (shares) (3)
— — — — — — 26,853 
(1)Income statement-related ratios for partial-year periods are annualized.
(2)See Reconciliation of Non-GAAP Financial Measures below for a reconciliation of these financial measures.
(3)Reflects common stock repurchased under board of director authorizations for the common stock repurchase program.


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Nicolet Bankshares, Inc.
Consolidated Loan & Deposit Metrics (Unaudited)
(In thousands)
9/30/20246/30/20243/31/202412/31/20239/30/2023
Period End Loan Composition
Commercial & industrial$1,351,516 $1,358,152 $1,307,490 $1,284,009 $1,237,789 
Owner-occupied commercial real estate (“CRE”)
920,533 941,137 955,786 956,594 971,397 
Agricultural1,261,152 1,224,885 1,190,371 1,161,531 1,108,261 
Commercial3,533,201 3,524,174 3,453,647 3,402,134 3,317,447 
CRE investment1,226,982 1,198,020 1,188,722 1,142,251 1,130,938 
Construction & land development231,694 247,565 241,730 310,110 326,747 
Commercial real estate1,458,676 1,445,585 1,430,452 1,452,361 1,457,685 
Commercial-based loans4,991,877 4,969,759 4,884,099 4,854,495 4,775,132 
Residential construction85,811 90,904 84,370 75,726 76,289 
Residential first mortgage1,194,574 1,190,790 1,167,069 1,167,109 1,136,748 
Residential junior mortgage223,456 218,512 206,434 200,884 195,432 
Residential real estate
1,503,841 1,500,206 1,457,873 1,443,719 1,408,469 
Retail & other61,122 59,169 55,645 55,728 55,656 
Retail-based loans1,564,963 1,559,375 1,513,518 1,499,447 1,464,125 
Total loans$6,556,840 $6,529,134 $6,397,617 $6,353,942 $6,239,257 
Period End Deposit Composition
Noninterest-bearing demand
$1,839,617 $1,764,806 $1,665,229 $1,958,709 $2,020,074 
Interest-bearing demand
1,035,593 1,093,621 1,121,030 1,055,520 955,746 
Money market
1,928,977 1,963,559 2,027,559 1,891,287 1,933,227 
Savings763,024 762,529 765,084 768,401 789,045 
Time1,692,786 1,656,563 1,586,830 1,523,883 1,484,296 
Total deposits$7,259,997 $7,241,078 $7,165,732 $7,197,800 $7,182,388 
Brokered transaction accounts$159,547 $250,109 $265,818 $166,861 $146,517 
Brokered time deposits549,907 557,657 517,190 448,582 457,433 
Total brokered deposits$709,454 $807,766 $783,008 $615,443 $603,950 
Customer transaction accounts$5,407,664 $5,334,406 $5,313,085 $5,507,056 $5,551,575 
Customer time deposits1,142,879 1,098,906 1,069,639 1,075,301 1,026,863 
Total customer deposits (core)
$6,550,543 $6,433,312 $6,382,724 $6,582,357 $6,578,438 


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Nicolet Bankshares, Inc.
Net Interest Income and Net Interest Margin Analysis (Unaudited)
For the Three Months Ended
September 30, 2024June 30, 2024September 30, 2023
AverageAverageAverageAverageAverageAverage
(In thousands)BalanceInterestRateBalanceInterestRateBalanceInterestRate
ASSETS
Total loans (1) (2)
$6,542,532 $100,962 6.06 %$6,496,732 $98,086 5.99 %$6,230,336 $87,701 5.54 %
Investment securities (2)
873,212 6,666 3.05 %881,190 6,579 2.99 %962,607 6,235 2.59 %
Other interest-earning assets409,029 5,492 5.27 %355,175 4,695 5.24 %483,952 6,452 5.23 %
Total interest-earning assets7,824,773 $113,120 5.68 %7,733,097 $109,360 5.61 %7,676,895 $100,388 5.15 %
Other assets, net772,039 748,089 740,561 
Total assets$8,596,812 $8,481,186 $8,417,456 
LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing core deposits$4,723,464 $32,952 2.78 %$4,665,195 $31,713 2.73 %$4,491,858 $27,628 2.44 %
Brokered deposits768,058 9,108 4.72 %831,100 9,673 4.68 %651,745 7,336 4.47 %
Total interest-bearing deposits5,491,522 42,060 3.05 %5,496,295 41,386 3.03 %5,143,603 34,964 2.70 %
Wholesale funding161,737 2,196 5.31 %162,347 2,150 5.24 %241,689 3,446 5.58 %
Total interest-bearing liabilities5,653,259 $44,256 3.11 %5,658,642 $43,536 3.09 %5,385,292 $38,410 2.83 %
Noninterest-bearing demand deposits1,755,799 1,687,482 2,012,974 
Other liabilities69,512 64,683 36,057 
Stockholders' equity1,118,242 1,070,379 983,133 
Total liabilities and stockholders' equity$8,596,812 $8,481,186 $8,417,456 
Net interest income and rate spread$68,864 2.57 %$65,824 2.52 %$61,978 2.32 %
Net interest margin3.44 %3.35 %3.16 %
Loan purchase accounting accretion (3)
$1,527 0.09 %$1,527 0.08 %$1,637 0.10 %
Loan nonaccrual interest (4)
$(48)0.00 %$329 0.02 %$(257)(0.02)%
For the Nine Months Ended
September 30, 2024September 30, 2023
AverageAverageAverageAverage
(In thousands)BalanceInterestRateBalanceInterestRate
ASSETS
Total loans (1) (2)
$6,479,598 $292,792 5.95 %$6,223,396 $251,019 5.33 %
Investment securities (2)
879,701 19,442 2.95 %1,177,762 19,575 2.22 %
Other interest-earning assets370,047 14,775 5.26 %266,753 10,345 5.13 %
Total interest-earning assets7,729,346 $327,009 5.58 %7,667,911 $280,939 4.85 %
Other assets, net757,256 737,088 
Total assets$8,486,602 $8,404,999 
LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing core deposits$4,684,586 $95,921 2.74 %$4,365,843 $69,943 2.14 %
Brokered deposits759,791 26,515 4.66 %619,870 19,298 4.16 %
Total interest-bearing deposits5,444,377 122,436 3.00 %4,985,713 89,241 2.39 %
Wholesale funding163,053 6,580 5.30 %343,827 12,842 4.93 %
Total interest-bearing liabilities5,607,430 $129,016 3.07 %5,329,540 $102,083 2.56 %
Noninterest-bearing demand deposits1,737,220 2,067,265 
Other liabilities62,737 34,685 
Stockholders' equity1,079,215 973,509 
Total liabilities and stockholders' equity$8,486,602 $8,404,999 
Net interest income and rate spread$197,993 2.51 %$178,856 2.29 %
Net interest margin3.35 %3.07 %
Loan purchase accounting accretion (3)
$4,582 0.09 %$4,908 0.10 %
(1) Nonaccrual loans and loans held for sale are included in the daily average loan balances outstanding.
(2) The yield on tax-exempt loans and tax-exempt investment securities is computed on a tax-equivalent basis using a federal tax rate of 21%, and adjusted for the disallowance of interest expense.
(3) Loan purchase accounting accretion included in Total loans interest above, and the related impact to net interest margin.
(4) Loan nonaccrual interest included in Total loans interest above, and the related impact to net interest margin.
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Nicolet Bankshares, Inc.
Reconciliation of Non-GAAP Financial Measures (Unaudited)
For the Three Months EndedFor the Nine Months Ended
(In thousands, except per share data)
9/30/20246/30/20243/31/202412/31/20239/30/20239/30/20249/30/2023
Adjusted net income reconciliation: (1)
Net income (GAAP)$32,516 $29,273 $27,790 $30,661 $17,158 $89,579 $30,855 
Adjustments:
Provision expense (2)
— — — — — — 2,340 
Assets (gains) losses, net (3)
(1,177)(616)(1,909)(5,947)(31)(3,702)38,755 
Merger-related expense— — — — — — 189 
Contract termination charge— — — 2,689 — — — 
Adjustments subtotal(1,177)(616)(1,909)(3,258)(31)(3,702)41,284 
Tax on Adjustments (4)
(230)(120)(372)(635)(6)(722)8,050 
Tax - Wisconsin Tax Law Change (4)
— — — — 6,151 — 9,118 
Adjusted net income (Non-GAAP)$31,569 $28,777 $26,253 $28,038 $23,284 $86,599 $73,207 
Diluted earnings per common share:
Diluted earnings per common share (GAAP)$2.10 $1.92 $1.82 $2.02 $1.14 $5.84 $2.05 
Adjusted Diluted earnings per common share (Non-GAAP)$2.04 $1.88 $1.72 $1.85 $1.54 $5.65 $4.87 
Tangible assets: (5)
Total assets$8,637,118 $8,557,017 $8,446,662 $8,468,678 $8,416,162 
Goodwill and other intangibles, net389,727 391,421 393,183 394,366 396,208 
Tangible assets$8,247,391 $8,165,596 $8,053,479 $8,074,312 $8,019,954 
Tangible common equity: (5)
Stockholders’ equity (common)$1,149,327 $1,091,413 $1,063,655 $1,039,007 $974,461 
Goodwill and other intangibles, net389,727 391,421 393,183 394,366 396,208 
Tangible common equity$759,600 $699,992 $670,472 $644,641 $578,253 
Tangible average common equity: (5)
Average stockholders’ equity (common)$1,118,242 $1,070,379 $1,048,596 $996,745 $983,133 $1,079,215 $973,509 
Average goodwill and other intangibles, net390,453 392,171 393,961 395,158 397,052 392,189 399,100 
Average tangible common equity$727,789 $678,208 $654,635 $601,587 $586,081 $687,026 $574,409 
Note: Numbers may not sum due to rounding.
(1)The adjusted net income measure and related reconciliation provide information useful to investors in understanding the operating performance and trends of Nicolet and also to aid investors in the comparison of Nicolet’s financial performance to the financial performance of peer banks.
(2)Provision expense for 2023 is attributable to the expected loss on a bank subordinated debt investment.
(3)Includes the gains / (losses) on other assets and investments, as well as the impact of the March 2023 balance sheet repositioning which included the sale of $500 million (par value) U.S. Treasury held to maturity securities for a pre-tax loss of $38 million or an after-tax loss of $28 million, with the net proceeds used to reduce FHLB borrowings and the remainder held in investable cash.
(4)In July 2023, a new Wisconsin tax law change was signed which provided financial institutions with an exemption from state taxable income for interest, fees, and penalties earned on specific loans to existing Wisconsin-based business or agriculture purpose loans. The effective tax rate for periods prior to the July 1, 2023, effective date of this tax law change assumed an effective tax rate of 25%, and periods subsequent to the effective date assumed an effective tax rate of 19.5%. The adjusted net income reconciliation for first and second quarter 2023 is as originally reported, and has not been restated to reflect the $3 million excess tax expense of those quarters that was subsequently reversed in third quarter 2023 due to the Wisconsin tax law change. Thus, the adjusted net income reconciliation for the quarters of 2023 will not sum to the full year impact.
(5)The ratios of tangible book value per common share, return on average tangible common equity, and tangible common equity to tangible assets exclude goodwill and other intangibles, net. These financial ratios have been included as they are considered to be critical metrics with which to analyze and evaluate financial condition and capital strength.


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