First Internet Bancorp reported second quarter 2026 results that management described as an inflection point, with total revenue growing 23% year over year to $41.1 million and non-GAAP diluted earnings per share rising to $0.27 from $0.02 in the prior year period. Pre-provision net revenue increased 28% to $15.0 million, while the net interest margin on a fully taxable equivalent basis expanded 43 basis points to 2.47%, driven by lower deposit costs and an improved funding mix. Provision for credit losses declined 18% from the first quarter to $13.4 million, and non-performing loans fell to $60.1 million, or 1.58% of total loans, marking the first sequential decline in several quarters. Small business lending delinquencies dropped sharply to $1.5 million from $13.3 million in the prior quarter, and early-stage delinquencies in the franchise finance portfolio have fallen over 85% since the end of 2025. The company raised its full-year non-interest income guidance to $40.5 million to $41 million, citing strength in Banking-as-a-Service fees and loan sale premiums, while lowering its net interest income outlook to $141 million to $142 million due to a smaller balance sheet and elevated payoffs. Full-year EPS guidance was maintained at $2.35 to $2.45, and the company expects continued net interest margin expansion supported by the repricing of $445 million in certificates of deposit maturing in the third quarter at a weighted average cost of 4.04%.
First Internet BancorpQ2 earnings beat with revenue up 23%, EPS up from $0.02 to $0.27, and improved credit trends.
