8-K

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934

Date of Report: July 21,2006
(Date of earliest event reported)

QCR Holdings, Inc.
(Exact name of Registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation)
0-22208	42-1397595
(Commission File Number)	(I.R.S. Employer Identification Number)
3551 Seventh Street, Suite 204, Moline, Illinois	61265
(Address of principal executive offices)	(Zip Code)
(309) 736-3580
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02.     Results of Operations and Financial Condition

On July 21, 2006, QCR Holdings, Inc. issued an earnings release announcing their Company’s financial results for the second quarter, ended June 30,2006. The news release is attached hereto as Exhibit 99.1.

Item 9.01      Financial Statements and Exhibits

                      (d) Exhibits

                      99.1     News release dated July 21, 2006

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by theundersigned hereunto duly authorized.

	QCR HOLDINGS, INC.
Dated:  July 21, 2006	By:	/s/ Todd A. Gipple
		Todd A. Gipple
		Executive Vice President
		and Chief Financial Officer

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EX-99.1

Exhibit 99.1

PRESS RELEASE

FOR IMMEDIATE RELEASE	Contact:
July 21, 2006	Todd A. Gipple
	Executive Vice President
	Chief Financial Officer
	(309) 743-7745

QCR Holdings, Inc.
Announces Earnings Results For the Second Quarter of 2006

          QCR Holdings, Inc. (Nasdaq /QCRH) today announced that earnings for the second quarter ended June 30, 2006 were $1.2 million, or basic and diluted earnings per share of $0.26.  For the same quarter one year ago, the Company reported earnings of $1.3 million, or basic earnings per share of $0.28 and diluted earnings per share of $0.27.  Earnings for the first quarter of 2006 were $833 thousand, or basic and diluted earnings per share of $0.18.

          Earnings for the six months ended June 30, 2006 were $2.0 million, or basic and diluted earnings per share of $0.44.  For the comparable period in 2005, the Company had earnings of $2.6 million, or basic earnings per share of $0.57 and diluted earnings per share of $0.56.   

          During the first six months of 2006, the Company’s total assets increased by 11%, or $114.0 million, to $1.16 billion from $1.04 billion at December 31, 2005.  During this same period, net loans/leases increased by 15%, or $109.9 million, to $857.3 million from $747.4 million at December 31, 2005.  Total deposits increased by 15% to $804.1 million at June 30, 2006 when compared to $698.5 million at December 31, 2005.  Stockholders’ equity rose to $56.1 million at June 30, 2006 as compared to $54.5 million at December 31, 2005.

          The Company’s net income for the quarter ended June 30, 2006 was $1.2 million, which was an improvement of 44%, or $370 thousand from the previous quarter.  Quarter-to-quarter total revenue increased by $2.2 million, or 12%, while total expense increased by $1.5 million, or 9%.   In a comparison of the second quarter of 2006 to the first quarter of 2006, the combination of a 2% increase in net interest income, or $136 thousand, an increase in noninterest income of 29%, or $800 thousand, and a 35% decrease in the provision for loan/lease losses, or $192 thousand, was partially offset by an increase in noninterest expenses of 6%, or $489 thousand.  The gain on sale of a foreclosed asset at Quad City Bank & Trust contributed $745 thousand, or 93%, of the quarter-to-quarter increase in noninterest income.  A 9% increase in salaries and employee benefits expense was the primary contributor to the increase in noninterest expenses during the second quarter.

          “During the second quarter, our net interest margin continued to experience stress created by the combination of a flat yield curve and significant competition”, stated Mr. Douglas M. Hultquist, President and CEO.  “However, despite the narrowing of our net interest spread for the fourth consecutive quarter, the Company’s net interest income grew $136 thousand, or 2%, from the first quarter.  The negative effects of increased average rates on the liability side of our balance sheet were more than offset by the positive effects of very strong loan/lease growth at our subsidiary banks.”

          “During the second quarter of 2006, Quad City Bank & Trust completed the sale of a foreclosed asset, which resulted in a pretax gain of $745 thousand,” stated Michael Bauer, Chairman of the Company and President and Chief Executive Officer at Quad City Bank & Trust.  “Also during the second quarter, the improved credit positions on a few large commercial loans at Quad City Bank & Trust resulted in reduced provisions to the allowance for estimated losses on loans/leases in both May and June.  The result of these reserve reversals produced an aggregate positive effect to second quarter net income of $290 thousand.”

          Mr. Hultquist concluded, “Previously, we announced our hiring of a team of bankers in the Milwaukee market, who since June have been setting up and operating as a branch of Rockford Bank & Trust.  During the second quarter, this new operation experienced an after-tax start-up loss of $219 thousand.  We firmly believe that the negative impact on earnings created by the expenditures necessary to establish our Wisconsin operation represents our contribution to a long-term investment, which should provide the Company and its shareholders with significant benefits in the future.”

          Quad City Bank & Trust, the Company’s first subsidiary bank, had total consolidated assets of $766.6 million at June 30, 2006, which was an increase of  $43.0 million from December 31, 2005.  At the close of the second quarter of 2006, Quad City Bank & Trust had net loans/leases of $574.9 million and deposits of $525.2 million, which were increases from December 31, 2005 of 11% and 10%, respectively.  The bank realized after-tax net income of $2.1 million for the second quarter of 2006, which was an increase of $665 thousand from $1.4 million for the first quarter of 2006.  The gain on sale of a foreclosed asset, in combination with the negative provisions to the allowance for estimated losses on loan/leases, contributed significantly to the quarter-to-quarter increase in net income.  At June 30, year-to-date earnings for the bank were $3.5 million, which is an increase of $191thousand, or 6%, from one year ago.

          Cedar Rapids Bank & Trust, which opened in September of 2001, surpassed the threshold of $300 million in total assets during the second quarter.  The bank reached total assets of $309.6 million at June 30, 2006, for an increase of $19.9 million from December 31, 2005.  At the end of the second quarter of 2006, Cedar Rapids Bank & Trust had net loans of $221.9 million and deposits of $219.7 million, which were increases from December 31, 2005 of 9% and 13%, respectively.  After-tax net income for Cedar Rapids Bank & Trust for the second quarter of 2006 was $366 thousand, which was a decrease of $22 thousand from $388 thousand for the first quarter.  At June 30, year-to-date earnings for the bank were $754 thousand, which is an increase of $27 thousand, or 4%, from one year ago.

          The Company’s newest banking subsidiary, Rockford Bank & Trust, reached total assets of $79.2 million, net loans of $60.5 million, and deposits of $60.3 million at June 30, 2006.  This represents growth from December 31, 2005 of $37.9 million, $35.0 million and $34.7 million, respectively.  During the second quarter, the Wisconsin operation contributed $8.2 million to net loan growth and $407 thousand to deposit growth.  Rockford Bank & Trust, which opened January 3, 2005, experienced a net operating loss of $556 thousand for the second quarter of 2006 compared to a loss of $320 thousand for the first quarter.  The Wisconsin operation accounted for $219 thousand of the second quarter loss.  At June 30, year-to-date losses for the bank were $876 thousand compared to losses of $669 thousand for the first six months of 2005.  The results of operations in both Rockford and Milwaukee are consistent with the Company’s expectations for this de novo charter.  In December 2005, Rockford Bank & Trust opened a second location in a temporary facility on Guilford Road at Alpine Road in Rockford, and construction of the permanent facility is underway with completion expected in October 2006.

          In August 2005, the Company acquired M2 Lease Funds, LLC.  Since that time, the growth and earnings at this subsidiary have been consistent with the Company’s expectations.  At June 30, 2006, M2 Lease Funds had total assets of $46.0 million and pretax net income of $592 thousand year-to-date and $269 thousand for the second quarter.

          “Nonperforming assets at June 30, 2006 were $7.8 million, which were up from $3.7 million at the end of 2005,” stated Mr. Bauer.  He continued, “A single commercial relationship at Quad City Bank & Trust contributed $4.3 million to nonperforming assets, when the related loans were placed into nonaccrual status.  At the close of the second quarter of 2006, nonaccrual loans increased to $7.3 million, from $2.6 million at December 31, 2005, and accruing loans past due 90 days or more decreased $454 thousand from the end of the year.  Also, during the first six months of 2006, two properties were sold, which had been held in other real estate owned (OREO) at December 31, 2005.”  He continued,  “The maintenance of our credit quality always remains a strong focus.  Management is continually monitoring the Company’s loan/lease portfolio and the level of allowance for loan/lease losses.  The Company’s allowance for loan/lease losses to total loans/leases was 1.12% at June 30, 2006.  The Company’s diligent efforts in recent months has reduced its exposure to loss on several loans at Quad City Bank & Trust, and in turn, reduced the level of provisions for loan/lease losses required at June 30, 2006.” 

          QCR Holdings, Inc., headquartered in Moline, Illinois, is a multi-bank holding company, which serves the Quad City, Cedar Rapids, Rockford and Milwaukee communities through its wholly owned subsidiary banks.  Quad City Bank and Trust Company, which is based in Bettendorf, Iowa and commenced operations in 1994, Cedar Rapids Bank and Trust Company, which is based in Cedar Rapids, Iowa and commenced operations in 2001, and Rockford Bank and Trust Company, which is based in Rockford, Illinois and commenced operations in 2005, provide full-service commercial and consumer banking and trust and asset management services.  The Company also engages in credit card processing through its wholly owned subsidiary, Quad City Bancard, Inc., based in Moline, Illinois and commercial leasing through its 80% owned subsidiary, M2 Lease Funds, LLC, based in Milwaukee, Wisconsin.

          Special Note Concerning Forward-Looking Statements.  This document contains, and future oral and written statements of the Company and its management may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of the Company.  Forward-looking statements, which may be based upon beliefs, expectations and assumptions of the Company’s management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “predict,” “suggest,” “appear,” “plan,” “intend,” “estimate,” “annualize,” “may,” “will,” “would,” “could,” “should” or other similar expressions.  Additionally, all statements in this document, including forward-looking statements, speak only as of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.

          A number of factors, many of which are beyond the ability of the Company to control or predict, could cause actual results to differ materially from those in its forward-looking statements.  These factors include, among others, the following: (i) the strength of the local and national economy; (ii) the economic impact of any future terrorist threats and attacks, and the response of the United Sates to any such threats and attacks; (iii) changes in state and federal laws, regulations and governmental policies concerning the Company’s general business; (iv) changes in interest rates and prepayment rates of the Company’s assets; (v) increased competition in the financial services sector and the inability to attract new customers; (vi) changes in technology and the ability to develop and maintain secure and reliable electronic systems; (vii) the loss of key executives or employees; (viii) changes in consumer spending; (ix) unexpected results of our strategy to establish denovo banks in new markets; (x) unexpected outcomes of existing or new litigation involving the Company; and (xi) changes in accounting policies and practices.  These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements.  Additional information concerning the Company and its business, including additional factors that could materially affect the Company’s financial results, is included in the Company’s filings with the Securities and Exchange Commission.

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QCR HOLDINGS, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited)

	As of
(dollars in thousands, except share data)	June 30, 2006			March 31, 2006			December 31, 2005			June 30, 2005
SELECTED BALANCE SHEET DATA
Total assets	$	1,156,572		$	1,066,154		$	1,042,614		$	920,061
Securities	$	184,503		$	184,241		$	182,365		$	153,975
Total loans/leases	$	867,085		$	785,750		$	756,254		$	674,278
Allowance for estimated loan/lease losses	$	9,744		$	9,362		$	8,884		$	8,662
Total deposits	$	804,103		$	747,388		$	698,504		$	595,716
Total stockholders’ equity	$	56,175		$	55,459		$	54,467		$	52,939
Common shares outstanding		4,548,256			4,537,711			4,531,224			4,519,559
Book value per common share	$	12.35		$	12.22		$	12.02		$	11.71
Closing stock price	$	17.24		$	19.22		$	19.70		$	21.00
Market capitalization	$	78,412		$	87,215		$	89,265		$	94,911
Market price/book value		139.59	%		157.26	%		163.89	%		179.28	%
Full time equivalent employees		333			315			305			286
Tier 1 leverage capital ratio		6.68	%		6.68	%		6.87	%		7.81	%

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QCR HOLDINGS, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited)

	As of
(dollars in thousands)	June 30, 2006		March 31, 2006		December 31, 2005		June 30, 2005
ANALYSIS OF LOAN DATA
Nonaccrual loans/leases	$	7,316	$	2,598	$	2,579	$	5,226
Accruing loans/leases past due 90 days or more		150		104		604		1,350
Other real estate owned		318		332		545		1,402
Total nonperforming assets	$	7,784	$	3,034	$	3,728	$	7,978
Net charge-offs (calendar year-to-date)	$	35	$	66	$	1,689	$	754
Loan/lease mix:
Commercial loans	$	676,579	$	619,477	$	593,741	$	548,107
Direct financing leases		43,656		37,132		35,700		—
Real estate loans		75,456		62,810		59,536		64,731
Installment and other consumer loans		71,394		66,331		67,277		61,440
Total loans/leases	$	867,085	$	785,750	$	756,254	$	674,278
ANALYSIS OF DEPOSIT DATA
Deposit mix:
Noninterest-bearing	$	126,018	$	110,864	$	114,176	$	103,981
Interest-bearing		678,085		636,524		584,328		491,735
Total deposits	$	804,103	$	747,388	$	698,504	$	595,716

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QCR HOLDINGS, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited)

	For the Quarter Ended									For the Six Months Ended
(dollars in thousands, except per share data)		June 30, 2006			March 31, 2006			June 30, 2005			June 30, 2006			June 30, 2005
SELECTED INCOME STATEMENT DATA
Interest income	$	16,223		$	14,869		$	11,539		$	31,092		$	22,219
Interest expense		8,970			7,752			4,782			16,722			8,974
Net interest income		7,253			7,117			6,757			14,370			13,245
Provision for loan/lease losses		352			544			(147	)		895			154
Net interest income after provision for loan/lease losses		6,901			6,573			6,904			13,475			13,091
Noninterest income		3,596			2,796			2,435			6,392			4,952
Noninterest expense		8,682			8,194			7,443			16,876			14,196
Income before taxes		1,815			1,175			1,896			2,991			3,847
Minority interest in income of consolidated subsidiary		48			53			—			101			—
Income tax expense		564			289			634			853			1,261
Net income	$	1,203		$	833		$	1,262		$	2,037		$	2,586
Earnings per common share (basic)	$	0.26		$	0.18		$	0.28		$	0.44		$	0.57
Earnings per common share (diluted)	$	0.26		$	0.18		$	0.27		$	0.44		$	0.56
Earnings per common share (basic) LTM *	$	0.94		$	0.95		$	1.20
AVERAGE BALANCES
Assets	$	1,105,624		$	1,056,610		$	901,609		$	1,081,117		$	890,099
Deposits	$	759,828		$	738,765		$	589,851		$	749,298		$	591,548
Loans/leases	$	817,612		$	764,038		$	660,877		$	790,825		$	654,400
Stockholders’ equity	$	55,971		$	54,926		$	52,207		$	55,449		$	51,684
KEY RATIOS
Return on average assets (annualized)		0.44	%		0.32	%		0.56	%		0.38	%		0.58	%
Return on average common equity (annualized)		8.60	%		6.07	%		9.67	%		7.35	%		10.01	%
Price earnings ratio LTM *		18.34	x		20.23	x		17.50	x		18.34	x		17.50	x
Net interest margin (TEY)		2.90	%		2.98	%		3.33	%		2.94	%		3.29	%
Nonperforming assets / total assets		0.67	%		0.28	%		0.87	%		0.67	%		0.87	%
Net charge-offs / average loans/leases		0.00	%		0.01	%		0.00	%		0.00	%		0.12	%
Allowance / total loans/leases		1.12	%		1.19	%		1.28	%		1.12	%		1.28	%
Efficiency ratio		80.03	%		82.66	%		80.98	%		81.28	%		78.01	%

* LTM: Last twelve months

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QCR HOLDINGS, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited)

	For the Quarter Ended								For the Six Months Ended
(dollars in thousands, except share data)	June 30, 2006			March 31, 2006			June 30, 2005		June 30, 2006			June 30, 2005
ANALYSIS OF NONINTEREST INCOME
Merchant credit card fees, net of processing costs	$	492		$	496		$	384	$	988		$	803
Trust department fees		741			781			720		1,522			1,455
Deposit service fees		479			465			396		944			778
Gain on sales of loans, net		287			205			351		492			605
Securities losses, net		(71	)		(143	)		—		(214	)		—
Gains on sale of foreclosed assets		745			5			—		750			—
Earnings on cash surrender value of life insurance		163			250			140		413			319
Investment advisory and management fees		363			301			200		664			340
Other		397			436			244		833			652
Total noninterest income	$	3,596		$	2,796		$	2,435	$	6,392		$	4,952
ANALYSIS OF NONINTEREST EXPENSE
Salaries and employee benefits	$	5,483		$	5,048		$	4,120	$	10,531		$	8,017
Professional and data processing fees		768			791			825		1,559			1,437
Advertising and marketing		384			243			308		627			568
Occupancy and equipment expense		1,275			1,250			1,022		2,525			1,998
Stationery and supplies		168			169			164		337			312
Postage and telephone		248			225			198		473			395
Bank service charges		143			136			139		279			257
Insurance		153			133			154		286			307
Other		60			199			513		259			905
Total noninterest expenses	$	8,682		$	8,194		$	7,443	$	16,876		$	14,196
WEIGHTED AVERAGE SHARES
Common shares outstanding (a)		4,543,169			4,535,591			4,514,459		4,576,755			4,508,886
Incremental shares from assumed conversion:
Options and Employee Stock Purchase Plan		45,215			50,280			99,797		47,722			103,892
Adjusted weighted average shares (b)		4,588,384			4,585,871			4,614,256		4,624,477			4,612,778

(a)     Denominator for Basic Earnings Per Share

(b)     Denominator for Diluted Earnings Per Share

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