Alerus Financial (ALRS) investor relations material

Executive summary

• Net income for Q1 2026 was $23.0 million, or $0.89 per diluted share, up 72.5% year-over-year, with strong returns on assets (1.79%) and tangible common equity (over 21%).

• Results driven by margin expansion, resilient fee income, disciplined expense management, and improved asset quality.

• Balance sheet remains healthy with stable loan balances and a 3.7% increase in deposits quarter-over-quarter.

• Diversified revenue streams, with over 40% fee-based, provide stability across cycles.

• Continued investment in talent and technology while maintaining expense discipline.

Financial highlights

• Net interest income for Q1 2026 was $44.9 million, up 9.1% year-over-year, with net interest margin rising to 3.77%.

• Adjusted diluted EPS was $0.89, including $6 million in share repurchases.

• Tangible book value per share rose 3.4% to $18.15; tangible common equity ratio improved to 8.85%.

• Noninterest income was $30.8 million, representing 40.7% of total revenue, with year-over-year growth in retirement, benefit, and mortgage banking services.

• Noninterest expense declined 2.9% sequentially, reflecting lower incentive compensation.

Outlook and guidance

• Loans expected to grow at a mid-single digit rate for 2026, despite $400 million in maturities.

• Deposits projected to grow in the low single digits; ample liquidity to support loan growth.

• Net interest margin guidance for 2026 is 3.55%-3.65%, including purchase accounting accretion.

• Adjusted non-interest income and total net revenue both expected to grow mid-single digits; non-interest expense growth in low single digits.

• Full-year return on assets expected to exceed 1.25%.