INBKZ · First Internet Bancorp - Fixed-

First Internet Bancorp reported strong first quarter 2026 results, with net income of $2.5 million ($0.29 diluted EPS) surging 166% year-over-year from $0.9 million ($0.11 EPS). The improvement was driven by 21% total revenue growth to $43.1 million, fueled by a 26% increase in net interest income to $31.6 million and a 10% rise in noninterest income to $11.5 million. Net interest margin expanded 54 basis points to 2.36% (FTE 2.45%), reflecting successful balance sheet repositioning and proactive liability management, including lower deposit costs. Pre-provision net revenue (non-GAAP) grew 51% to $18.1 million, demonstrating positive operating leverage.

Credit quality metrics showed mixed trends. The provision for credit losses increased to $16.3 million from $12.0 million in the prior quarter, driven by CECL re-measurement. Nonperforming loans rose to $61.6 million (1.63% of loans) from $58.5 million (1.56%) at year-end 2025, primarily due to fully-guaranteed SBA balances and accruing loans past due 90+ days, partially offset by lower nonaccrual franchise finance loans. Net charge-offs to average loans improved slightly to 1.65% from 1.68% in Q4 2025.

Management commentary highlighted strong loan production in construction and single tenant lease financing, with pipelines remaining solid. However, the company acknowledged that its full-year 2026 loan growth target of 15-17% may be ambitious due to higher-than-expected payoffs and potential tightening of underwriting standards amid macroeconomic uncertainty. The company continues to invest in AI and digital capabilities, with virtual customer service agents resolving 45% of inquiries and BaaS partnerships providing deposit funding flexibility. Capital ratios remained solid, with CET1 at 8.97% and total capital at 12.50%. Tangible book value per share held steady at $40.87.