MidWestOne Financial Group, Inc. Reports Financial Results for the Second Quarter of 2024
MidWestOne Financial Group (Nasdaq: MOFG) reported its Q2 2024 financial results. The company achieved net income of $15.8 million, or $1.00 per diluted share, and revenue of $57.9 million, which included an $11.1 million gain from the sale of its Florida banking operations. Noninterest expense stood at $35.8 million, with $854,000 in merger-related costs.
Key highlights: the divestiture of Florida operations for a 7.5% deposit premium, and a 9% reduction in classified loans. The net interest margin increased to 2.41% from 2.33%. The tangible book value per share rose to $28.27.
Additionally, noninterest income surged by 121% from the previous quarter, largely due to the Florida sale. However, net interest income declined by 2% year-over-year, impacted by increased funding costs. Total assets decreased to $6.58 billion due to the sale of Florida operations.
MidWestOne Financial Group (Nasdaq: MOFG) ha riportato i risultati finanziari del Q2 2024. L'azienda ha raggiunto un utile netto di 15,8 milioni di dollari, ovvero 1,00 dollaro per azione diluita, e ricavi di 57,9 milioni di dollari, che includevano un guadagno di 11,1 milioni di dollari derivante dalla vendita delle operazioni bancarie in Florida. Le spese non da interessi si sono attestate a 35,8 milioni di dollari, con 854.000 dollari in costi legati alla fusione.
Principali punti salienti: la dismissione delle operazioni in Florida con un premio sui depositi del 7,5% e una riduzione del 9% nei prestiti classificati. Il margine d'interesse netto è aumentato al 2,41% rispetto al 2,33%. Il valore contabile tangibile per azione è salito a 28,27 dollari.
Inoltre, il reddito non da interessi è aumentato del 121% rispetto al trimestre precedente, principalmente grazie alla vendita in Florida. Tuttavia, il reddito netto da interessi è diminuito del 2% su base annua, influito dall'aumento dei costi di finanziamento. Il totale degli attivi è sceso a 6,58 miliardi di dollari a causa della vendita delle operazioni in Florida.
MidWestOne Financial Group (Nasdaq: MOFG) reportó sus resultados financieros del Q2 2024. La empresa logró un ingreso neto de 15,8 millones de dólares, o 1,00 dólar por acción diluida, y ingresos de 57,9 millones de dólares, que incluyeron una ganancia de 11,1 millones de dólares de la venta de sus operaciones bancarias en Florida. Los gastos no por intereses fueron de 35,8 millones de dólares, con 854.000 dólares en costos relacionados con fusiones.
Aspectos clave: la desinversión de las operaciones en Florida por un premio del 7,5% en depósitos, y una reducción del 9% en préstamos clasificados. El margen de interés neto aumentó al 2,41% desde el 2,33%. El valor en libros tangible por acción subió a 28,27 dólares.
Además, los ingresos no por intereses se dispararon un 121% respecto al trimestre anterior, principalmente debido a la venta de Florida. Sin embargo, el ingreso neto por intereses disminuyó un 2% en comparación interanual, afectado por los mayores costos de financiamiento. Los activos totales disminuyeron a 6,58 mil millones de dólares debido a la venta de las operaciones en Florida.
MidWestOne Financial Group (Nasdaq: MOFG)은 2024년 2분기 재무 결과를 발표했습니다. 회사는 1580만 달러의 순이익, 즉 희석주당 1.00 달러를 달성했으며, 5790만 달러의 매출을 기록했습니다. 여기에는 플로리다 은행 운영 매각으로 인한 1110만 달러의 이익이 포함되어 있습니다. 이자 외 비용은 3580만 달러로, 인수 관련 비용이 854,000 달러였습니다.
주요 하이라이트: 플로리다 운영의 매각을 통해 7.5%의 예금 프리미엄을 얻었고, 분류된 대출이 9% 감소했습니다. 순이자 마진은 2.33%에서 2.41%로 증가했습니다. 주당 실질 장부 가치는 28.27 달러로 상승했습니다.
또한, 이자 외 수익은 플로리다 매각 덕분에 이전 분기 대비 121% 급증했습니다. 그러나 순이자 수익은 자금 조달 비용 상승으로 인해 전년 대비 2% 감소했습니다. 총 자산은 플로리다 운영 매각으로 인해 65억8000만 달러로 감소했습니다.
MidWestOne Financial Group (Nasdaq: MOFG) a publié ses résultats financiers pour le 2e trimestre 2024. L'entreprise a réalisé un bénéfice net de 15,8 millions de dollars, soit 1,00 dollar par action diluée, et des recettes de 57,9 millions de dollars, comprenant un gain de 11,1 millions de dollars provenant de la vente de ses opérations bancaires en Floride. Les frais non liés aux intérêts se sont élevés à 35,8 millions de dollars, dont 854 000 dollars de coûts liés à la fusion.
Points forts : la cession des opérations de Floride pour une prime de dépôt de 7,5 % et une réduction de 9 % des prêts classés. Le marge d'intérêt net a augmenté de 2,33 % à 2,41 %. La valeur comptable tangible par action est passée à 28,27 dollars.
De plus, le revenu non lié aux intérêts a grimpé de 121 % par rapport au trimestre précédent, principalement en raison de la vente en Floride. Cependant, le revenu net d'intérêts a diminué de 2 % d'une année sur l'autre, affecté par l'augmentation des coûts de financement. Le total des actifs a diminué à 6,58 milliards de dollars en raison de la vente des opérations en Floride.
MidWestOne Financial Group (Nasdaq: MOFG) hat die Finanzzahlen für das Q2 2024 veröffentlicht. Das Unternehmen erzielte einen Nettoverdienst von 15,8 Millionen Dollar, was 1,00 Dollar pro verwässerter Aktie entspricht, und Einnahmen von 57,9 Millionen Dollar, die einen Gewinn von 11,1 Millionen Dollar aus dem Verkauf seiner Bankgeschäfte in Florida beinhalteten. Die nicht zinstragenden Aufwendungen lagen bei 35,8 Millionen Dollar, einschließlich 854.000 Dollar an fusionsbedingten Kosten.
Wichtige Highlights: die Veräußerung der Florida-Betriebe zu einem Einlageprämie von 7,5 % und eine Reduzierung der klassifizierten Kredite um 9 %. Die Nettozinsspanne erhöhte sich von 2,33 % auf 2,41 %. Der tatsächliche Buchwert pro Aktie stieg auf 28,27 Dollar.
Darüber hinaus stieg das nicht zinstragende Einkommen im Vergleich zum Vorquartal um 121 %, hauptsächlich aufgrund des Verkaufs in Florida. Der Nettozinsertrag fiel jedoch im Jahresvergleich um 2 %, was auf gestiegene Finanzierungskosten zurückzuführen war. Die Gesamtaktiva sanken auf 6,58 Milliarden Dollar aufgrund des Verkaufs der Florida-Betriebe.
- Net income of $15.8 million, or $1.00 per diluted share.
- Revenue increased to $57.9 million, including an $11.1 million gain on the sale of Florida banking operations.
- Tangible book value per share increased to $28.27, up 4%.
- Net interest margin improved to 2.41%, up from 2.33% in Q1 2024.
- Noninterest income surged by 121% from the previous quarter.
- Classified loans declined by 9%.
- Net interest income decreased by 2% year-over-year.
- Total assets decreased to $6.58 billion, driven by the sale of Florida banking operations.
Insights
MidWestOne Financial Group delivered a strong quarter marked by strategic execution and improved profitability. Key highlights include:
- Net income of $15.8 million ($1.00 per diluted share), up significantly from $3.3 million in Q1 2024
- Revenue increased 30% quarter-over-quarter to $57.9 million
- Net interest margin expanded 8 basis points to 2.41%
- Completed sale of Florida banking operations for a 7.5% deposit premium
The sale of Florida operations for a premium demonstrates management's ability to optimize the company's footprint and unlock value. The 8 bp net interest margin expansion is particularly impressive in the current environment, driven by higher earning asset yields outpacing funding cost increases.
Asset quality metrics improved, with classified loans declining 9% and the net charge-off ratio at a low 0.05%. The 1.26% allowance for credit losses provides a solid buffer against potential loan losses.
Overall, MidWestOne appears well-positioned with a strengthened balance sheet, improved profitability and strategic focus on core growth markets. The stock could see upside if the company maintains this positive momentum in coming quarters.
IOWA CITY, Iowa, July 25, 2024 (GLOBE NEWSWIRE) -- MidWestOne Financial Group, Inc. (Nasdaq: MOFG) (“we”, “our”, or the "Company”) today reported results for the second quarter of 2024.
Second Quarter 2024 Summary1
- Completed sale of our Florida banking operations for a
7.5% deposit premium.- Included in the sale were
$133.3 million of deposits and$163.6 million of loans.
- Included in the sale were
- Net income of
$15.8 million , or$1.00 per diluted common share.- Revenue of
$57.9 million , which included gain on sale of$11.1 million and a positive MSR valuation adjustment of$129 thousand . - Noninterest expense of
$35.8 million , which included merger-related costs of$854 thousand .
- Revenue of
- Net interest margin (tax equivalent) expanded 8 bps to
2.41% 2. - Classified loans declined
9% ; net charge-off ratio was0.05% . - Tangible book value per share of
$28.27 2, an increase of$1.13 or4%
CEO Commentary
Charles (Chip) Reeves, Chief Executive Officer of the Company, commented, “We delivered another solid quarter of strategic plan execution highlighted by the divestiture of our Florida operations for a
I’m also very pleased with the level of talent acquisition in the first half of 2024 and second quarter highlights included our new EVP, Chief Information Officer and new SVP, Chief Marketing Officer. Even with significant talent, product and platform investments, our core noninterest expense levels approximate year ago levels.
These accomplishments are due to the engagement and expertise of our collective MOFG team, and we are humbled to once again receive the honor of being an Iowa, and USA, Top Workplace."
_________________________
1 Second Quarter Summary compares to the first quarter of 2024 (the "linked quarter") unless noted.
2 Non-GAAP measure. See the separate Non-GAAP Measures section for a reconciliation to the most directly comparable GAAP measure.
As of or for the quarter ended | Six Months Ended | |||||||||||||||||||
(Dollars in thousands, except per share amounts and as noted) | June 30, | March 31, | June 30, | June 30, | June 30, | |||||||||||||||
2024 | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||
Financial Results | ||||||||||||||||||||
Revenue | $ | 57,901 | $ | 44,481 | $ | 45,708 | $ | 102,382 | $ | 81,738 | ||||||||||
Credit loss expense | 1,267 | 4,689 | 1,597 | 5,956 | 2,530 | |||||||||||||||
Noninterest expense | 35,761 | 35,565 | 34,919 | 71,326 | 68,238 | |||||||||||||||
Net income | 15,819 | 3,269 | 7,594 | 19,088 | 8,991 | |||||||||||||||
Per Common Share | ||||||||||||||||||||
Diluted earnings per share | $ | 1.00 | $ | 0.21 | $ | 0.48 | $ | 1.21 | $ | 0.57 | ||||||||||
Book value | 34.44 | 33.53 | 31.96 | 34.44 | 31.96 | |||||||||||||||
Tangible book value(1) | 28.27 | 27.14 | 26.26 | 28.27 | 26.26 | |||||||||||||||
Balance Sheet & Credit Quality | ||||||||||||||||||||
LoansIn millions | $ | 4,287.2 | $ | 4,414.6 | $ | 4,018.6 | $ | 4,287.2 | $ | 4,018.6 | ||||||||||
Investment securities In millions | 1,824.1 | 1,862.2 | 2,003.1 | 1,824.1 | 2,003.1 | |||||||||||||||
DepositsIn millions | 5,412.4 | 5,585.2 | 5,445.4 | 5,412.4 | 5,445.4 | |||||||||||||||
Net loan charge-offs In millions | 0.5 | 0.2 | 0.9 | 0.7 | 1.2 | |||||||||||||||
Allowance for credit losses ratio | 1.26 | % | 1.27 | % | 1.25 | % | 1.26 | % | 1.25 | % | ||||||||||
Selected Ratios | ||||||||||||||||||||
Return on average assets | 0.95 | % | 0.20 | % | 0.47 | % | 0.58 | % | 0.28 | % | ||||||||||
Net interest margin, tax equivalent(1) | 2.41 | % | 2.33 | % | 2.52 | % | 2.37 | % | 2.63 | % | ||||||||||
Return on average equity | 11.91 | % | 2.49 | % | 6.03 | % | 7.23 | % | 3.61 | % | ||||||||||
Return on average tangible equity(1) | 15.74 | % | 4.18 | % | 8.50 | % | 9.98 | % | 5.65 | % | ||||||||||
Efficiency ratio(1) | 56.29 | % | 71.28 | % | 71.13 | % | 62.83 | % | 66.56 | % | ||||||||||
(1)Non-GAAP measure. See the Non-GAAP Measures section for a reconciliation to the most directly comparable GAAP measure. | ||||||||||||||||||||
GEOGRAPHIC RE-ALIGNMENT
Florida Banking Operations Divestiture
On June 7, 2024, we completed the sale of our Florida banking operations for a
Denver Bankshares, Inc. Acquisition
On January 31, 2024, we completed our acquisition of Denver Bankshares, Inc. ("DNVB") and its wholly-owned banking subsidiary, the Bank of Denver. The assets acquired and liabilities assumed have been accounted for under the acquisition method of accounting. The assets and liabilities, both tangible and intangible, were recorded at their fair values as of the January 31, 2024 acquisition date, net of any applicable tax effects. The Company considers all purchase accounting estimates provisional and fair values are subject to refinement for up to one year after the close date.
The table below summarizes the amounts recognized at the acquisition date for each major class of assets acquired and liabilities assumed:
(In thousands) | As of January 31, 2024 | |||
Merger consideration | ||||
Cash consideration | $ | 32,600 | ||
Identifiable net assets acquired, at fair value | ||||
Assets acquired | ||||
Cash and due from banks | 462 | |||
Interest earning deposits in banks | 3,517 | |||
Debt securities | 52,493 | |||
Loans held for investment | 207,095 | |||
Premises and equipment | 13,470 | |||
Core deposit intangible | 7,100 | |||
Other assets | 4,987 | |||
Total assets acquired | 289,124 | |||
Liabilities assumed | ||||
Deposits | (224,248 | ) | ||
Short-term borrowings | (37,500 | ) | ||
Other liabilities | (3,417 | ) | ||
Total liabilities assumed | (265,165 | ) | ||
Identifiable net assets acquired, at fair value | 23,959 | |||
Goodwill | $ | 8,641 | ||
REVENUE REVIEW
Revenue | Change | Change | |||||||||||||
2Q24 vs | 2Q24 vs | ||||||||||||||
(Dollars in thousands) | 2Q24 | 1Q24 | 2Q23 | 1Q24 | 2Q23 | ||||||||||
Net interest income | $ | 36,347 | $ | 34,731 | $ | 36,962 | 5 | % | (2 | )% | |||||
Noninterest income | 21,554 | 9,750 | 8,746 | 121 | % | 146 | % | ||||||||
Total revenue, net of interest expense | $ | 57,901 | $ | 44,481 | $ | 45,708 | 30 | % | 27 | % | |||||
Total revenue for the second quarter of 2024 increased
Net interest income of
The Company's tax equivalent net interest margin was
The Company's tax equivalent net interest margin was
Noninterest Income | Change | Change | ||||||||||||||
2Q24 vs | 2Q24 vs | |||||||||||||||
(In thousands) | 2Q24 | 1Q24 | 2Q23 | 1Q24 | 2Q23 | |||||||||||
Investment services and trust activities | $ | 3,504 | $ | 3,503 | $ | 3,119 | — | % | 12 | % | ||||||
Service charges and fees | 2,156 | 2,144 | 2,047 | 1 | % | 5 | % | |||||||||
Card revenue | 1,907 | 1,943 | 1,847 | (2 | )% | 3 | % | |||||||||
Loan revenue | 1,525 | 856 | 909 | 78 | % | 68 | % | |||||||||
Bank-owned life insurance | 668 | 660 | 616 | 1 | % | 8 | % | |||||||||
Investment securities gains (losses), net | 33 | 36 | (2 | ) | (8 | )% | n/m | |||||||||
Other | 11,761 | 608 | 210 | n/m | n/m | |||||||||||
Total noninterest income | $ | 21,554 | $ | 9,750 | $ | 8,746 | 121 | % | 146 | % | ||||||
MSR adjustment (included above in Loan revenue) | 129 | (368 | ) | (581 | ) | (135 | )% | (122 | )% | |||||||
Gain on branch sale (included above in Other) | 11,056 | — | — | n/m | n/m | |||||||||||
(n/m) - Not meaningful | ||||||||||||||||
Noninterest income for the second quarter of 2024 increased
Noninterest income for the second quarter of 2024 increased
_________________________
3 Non-GAAP measure. See the separate Non-GAAP Measures section for a reconciliation to the most directly comparable GAAP measure.
EXPENSE REVIEW
Noninterest Expense | Change | Change | |||||||||||||
2Q24 vs | 2Q24 vs | ||||||||||||||
(In thousands) | 2Q24 | 1Q24 | 2Q23 | 1Q24 | 2Q23 | ||||||||||
Compensation and employee benefits | $ | 20,985 | $ | 20,930 | $ | 20,386 | — | % | 3 | % | |||||
Occupancy expense of premises, net | 2,435 | 2,813 | 2,574 | (13 | )% | (5 | )% | ||||||||
Equipment | 2,530 | 2,600 | 2,435 | (3 | )% | 4 | % | ||||||||
Legal and professional | 2,253 | 2,059 | 1,682 | 9 | % | 34 | % | ||||||||
Data processing | 1,645 | 1,360 | 1,521 | 21 | % | 8 | % | ||||||||
Marketing | 636 | 598 | 1,142 | 6 | % | (44 | )% | ||||||||
Amortization of intangibles | 1,593 | 1,637 | 1,594 | (3 | )% | — | % | ||||||||
FDIC insurance | 1,051 | 942 | 862 | 12 | % | 22 | % | ||||||||
Communications | 191 | 196 | 260 | (3 | )% | (27 | )% | ||||||||
Foreclosed assets, net | 138 | 358 | (6 | ) | (61 | )% | n/m | ||||||||
Other | 2,304 | 2,072 | 2,469 | 11 | % | (7 | )% | ||||||||
Total noninterest expense | $ | 35,761 | $ | 35,565 | $ | 34,919 | 1 | % | 2 | % | |||||
(n/m) - Not meaningful |
Merger-related Expenses | ||||||||
(In thousands) | 2Q24 | 1Q24 | 2Q23 | |||||
Compensation and employee benefits | $ | 73 | $ | 241 | $ | — | ||
Occupancy expense of premises, net | — | 152 | — | |||||
Equipment | 28 | 149 | — | |||||
Legal and professional | 462 | 573 | — | |||||
Data processing | 251 | 61 | — | |||||
Marketing | — | 32 | — | |||||
Communications | 8 | 1 | — | |||||
Other | 32 | 105 | — | |||||
Total merger-related expenses | $ | 854 | $ | 1,314 | $ | — | ||
Noninterest expense for the second quarter of 2024 increased
Noninterest expense for the second quarter of 2024 increased
The Company's effective tax rate was
BALANCE SHEET REVIEW
Total assets were
Loans Held for Investment | June 30, 2024 | March 31, 2024 | June 30, 2023 | ||||||||||||
Balance | % of Total | Balance | % of Total | Balance | % of Total | ||||||||||
(Dollars in thousands) | |||||||||||||||
Commercial and industrial | $ | 1,120,983 | 26.1 | % | $ | 1,105,718 | 25.0 | % | $ | 1,089,269 | 27.1 | % | |||
Agricultural | 107,983 | 2.5 | 113,029 | 2.6 | 106,148 | 2.6 | |||||||||
Commercial real estate | |||||||||||||||
Construction and development | 351,646 | 8.2 | 403,571 | 9.1 | 313,836 | 7.8 | |||||||||
Farmland | 183,641 | 4.3 | 184,109 | 4.2 | 183,378 | 4.6 | |||||||||
Multifamily | 430,054 | 10.0 | 409,504 | 9.3 | 305,519 | 7.6 | |||||||||
Other | 1,348,515 | 31.5 | 1,440,645 | 32.7 | 1,331,886 | 33.1 | |||||||||
Total commercial real estate | 2,313,856 | 54.0 | 2,437,829 | 55.3 | 2,134,619 | 53.1 | |||||||||
Residential real estate | |||||||||||||||
One-to-four family first liens | 492,541 | 11.5 | 495,408 | 11.2 | 448,096 | 11.2 | |||||||||
One-to-four family junior liens | 176,105 | 4.1 | 182,001 | 4.1 | 168,755 | 4.2 | |||||||||
Total residential real estate | 668,646 | 15.6 | 677,409 | 15.3 | 616,851 | 15.4 | |||||||||
Consumer | 75,764 | 1.8 | 80,661 | 1.8 | 71,762 | 1.8 | |||||||||
Loans held for investment, net of unearned income | $ | 4,287,232 | 100.0 | % | $ | 4,414,646 | 100.0 | % | $ | 4,018,649 | 100.0 | % | |||
Total commitments to extend credit | $ | 1,200,605 | $ | 1,230,612 | $ | 1,296,719 | |||||||||
Loans held for investment, net of unearned income, decreased
Loans held for investment, net of unearned income, increased
Investment Securities | June 30, 2024 | March 31, 2024 | June 30, 2023 | ||||||||||||
(Dollars in thousands) | Balance | % of Total | Balance | % of Total | Balance | % of Total | |||||||||
Available for sale | $ | 771,034 | 42.3 | % | $ | 797,230 | 42.8 | % | $ | 903,520 | 45.1 | % | |||
Held to maturity | 1,053,080 | 57.7 | % | 1,064,939 | 57.2 | % | 1,099,569 | 54.9 | % | ||||||
Total investment securities | $ | 1,824,114 | $ | 1,862,169 | $ | 2,003,089 | |||||||||
Investment securities at June 30, 2024 were
Deposits | June 30, 2024 | March 31, 2024 | June 30, 2023 | ||||||||||||
(Dollars in thousands) | Balance | % of Total | Balance | % of Total | Balance | % of Total | |||||||||
Noninterest bearing deposits | $ | 882,472 | 16.3 | % | $ | 920,764 | 16.5 | % | $ | 897,923 | 16.5 | % | |||
Interest checking deposits | 1,284,243 | 23.7 | 1,349,823 | 24.2 | 1,397,276 | 25.7 | |||||||||
Money market deposits | 1,043,376 | 19.3 | 1,122,717 | 20.1 | 1,096,432 | 20.1 | |||||||||
Savings deposits | 745,639 | 13.8 | 728,276 | 13.0 | 585,967 | 10.8 | |||||||||
Time deposits of | 803,301 | 14.8 | 787,851 | 14.1 | 648,586 | 11.9 | |||||||||
Total core deposits | 4,759,031 | 87.9 | 4,909,431 | 87.9 | 4,626,184 | 85.0 | |||||||||
Brokered time deposits | 196,000 | 3.6 | 205,000 | 3.7 | 365,623 | 6.7 | |||||||||
Time deposits over | 457,388 | 8.5 | 470,805 | 8.4 | 453,640 | 8.3 | |||||||||
Total deposits | $ | 5,412,419 | 100.0 | % | $ | 5,585,236 | 100.0 | % | $ | 5,445,447 | 100.0 | % | |||
Deposits declined
Borrowed Funds | June 30, 2024 | March 31, 2024 | June 30, 2023 | ||||||||||||
(Dollars in thousands) | Balance | % of Total | Balance | % of Total | Balance | % of Total | |||||||||
Short-term borrowings | $ | 414,684 | 78.3 | % | $ | 422,988 | 77.6 | % | $ | 362,054 | 74.2 | % | |||
Long-term debt | 114,839 | 21.7 | % | 122,066 | 22.4 | % | 125,752 | 25.8 | % | ||||||
Total borrowed funds | $ | 529,523 | $ | 545,054 | $ | 487,806 | |||||||||
Borrowed funds were
Capital | June 30, | March 31, | June 30, | ||||||||
(Dollars in thousands) | 2024(1) | 2024 | 2023 | ||||||||
Total shareholders' equity | $ | 543,286 | $ | 528,040 | $ | 501,341 | |||||
Accumulated other comprehensive loss | (58,135 | ) | (60,804 | ) | (82,704 | ) | |||||
MidWestOneFinancial Group, Inc. Consolidated | |||||||||||
Tier 1 leverage to average assets ratio | 8.29 | % | 8.16 | % | 8.47 | % | |||||
Common equity tier 1 capital to risk-weighted assets ratio | 9.56 | % | 8.98 | % | 9.36 | % | |||||
Tier 1 capital to risk-weighted assets ratio | 10.35 | % | 9.75 | % | 10.15 | % | |||||
Total capital to risk-weighted assets ratio | 12.62 | % | 11.97 | % | 12.26 | % | |||||
MidWestOneBank | |||||||||||
Tier 1 leverage to average assets ratio | 9.24 | % | 9.36 | % | 9.42 | % | |||||
Common equity tier 1 capital to risk-weighted assets ratio | 11.55 | % | 11.20 | % | 11.31 | % | |||||
Tier 1 capital to risk-weighted assets ratio | 11.55 | % | 11.20 | % | 11.31 | % | |||||
Total capital to risk-weighted assets ratio | 12.61 | % | 12.25 | % | 12.22 | % | |||||
(1) Regulatory capital ratios for June 30, 2024 are preliminary | |||||||||||
Total shareholders' equity at June 30, 2024 increased
Accumulated other comprehensive loss at June 30, 2024 decreased
On July 23, 2024, the Board of Directors of the Company declared a cash dividend of
No common shares were repurchased by the Company during the period March 31, 2024 through June 30, 2024 or for the subsequent period through July 25, 2024. The current share repurchase program allows for the repurchase of up to
CREDIT QUALITY REVIEW
Credit Quality | As of or For the Three Months Ended | ||||||||||
June 30, | March 31, | June 30, | |||||||||
(Dollars in thousands) | 2024 | 2024 | 2023 | ||||||||
Credit loss expense related to loans | $ | 467 | $ | 4,589 | $ | 1,497 | |||||
Net charge-offs | 524 | 189 | 897 | ||||||||
Allowance for credit losses | 53,900 | 55,900 | 50,400 | ||||||||
Pass | $ | 3,991,692 | $ | 4,098,102 | $ | 3,769,309 | |||||
Special Mention / Watch | 146,253 | 152,604 | 133,904 | ||||||||
Classified | 149,287 | 163,940 | 115,436 | ||||||||
Loans greater than 30 days past due and accruing | $ | 9,358 | $ | 8,772 | $ | 6,201 | |||||
Nonperforming loans | $ | 25,128 | $ | 29,267 | $ | 14,448 | |||||
Nonperforming assets | 31,181 | 33,164 | 14,448 | ||||||||
Net charge-off ratio(1) | 0.05 | % | 0.02 | % | 0.09 | % | |||||
Classified loans ratio(2) | 3.48 | % | 3.71 | % | 2.87 | % | |||||
Nonperforming loans ratio(3) | 0.59 | % | 0.66 | % | 0.36 | % | |||||
Nonperforming assets ratio(4) | 0.47 | % | 0.49 | % | 0.22 | % | |||||
Allowance for credit losses ratio(5) | 1.26 | % | 1.27 | % | 1.25 | % | |||||
Allowance for credit losses to nonaccrual loans ratio(6) | 218.26 | % | 197.53 | % | 355.03 | % | |||||
(1)Net charge-off ratio is calculated as annualized net charge-offs divided by the sum of average loans held for investment, net of unearned income and average loans held for sale, during the period. | |||||||||||
(2)Classified loans ratio is calculated as classified loans divided by loans held for investment, net of unearned income, at the end of the period. | |||||||||||
(3)Nonperforming loans ratio is calculated as nonperforming loans divided by loans held for investment, net of unearned income, at the end of the period. | |||||||||||
(4)Nonperforming assets ratio is calculated as nonperforming assets divided by total assets at the end of the period. | |||||||||||
(5)Allowance for credit losses ratio is calculated as allowance for credit losses divided by loans held for investment, net of unearned income, at the end of the period. | |||||||||||
(6)Allowance for credit losses to nonaccrual loans ratio is calculated as allowance for credit losses divided by nonaccrual loans at the end of the period. | |||||||||||
Compared to the linked quarter, the nonperforming loans and nonperforming assets ratios declined 7 bps and 2 bps, to
As of June 30, 2024, the allowance for credit losses was
Nonperforming Loans Roll Forward | Nonaccrual | 90+ Days Past Due & Still Accruing | Total | ||||||||
(Dollars in thousands) | |||||||||||
Balance at March 31, 2024 | $ | 28,300 | $ | 967 | $ | 29,267 | |||||
Loans placed on nonaccrual or 90+ days past due & still accruing | 964 | 446 | 1,410 | ||||||||
Proceeds related to repayment or sale | (1,856 | ) | (1 | ) | (1,857 | ) | |||||
Loans returned to accrual status or no longer past due | (25 | ) | (596 | ) | (621 | ) | |||||
Charge-offs | (508 | ) | (158 | ) | (666 | ) | |||||
Transfers to foreclosed assets | (2,180 | ) | — | (2,180 | ) | ||||||
Transfer to nonaccrual | — | (225 | ) | (225 | ) | ||||||
Balance at June 30, 2024 | $ | 24,695 | $ | 433 | $ | 25,128 | |||||
CONFERENCE CALL DETAILS
The Company will host a conference call for investors at 11:00 a.m. CT on Friday, July 26, 2024. To participate, you may pre-register for this call utilizing the following link: https://www.netroadshow.com/events/login?show=25afc13e&confId=68332. After pre-registering for this event you will receive your access details via email. On the day of the call, you are also able to dial 1-833-470-1428 using an access code of 162387 at least fifteen minutes before the call start time. If you are unable to participate on the call, a replay will be available until October 24, 2024 by calling 1-866-813-9403 and using the replay access code of 323537. A transcript of the call will also be available on the Company’s web site (www.midwestonefinancial.com) within three business days of the call.
ABOUT MIDWESTONE FINANCIAL GROUP, INC.
MidWestOne Financial Group, Inc. is a financial holding company headquartered in Iowa City, Iowa. MidWestOne is the parent company of MidWestOne Bank, which operates banking offices in Iowa, Minnesota, Wisconsin, and Colorado. MidWestOne provides electronic delivery of financial services through its website, MidWestOne.bank. MidWestOne Financial Group, Inc. trades on the Nasdaq Global Select Market under the symbol “MOFG”.
Cautionary Note Regarding Forward-Looking Statements
This release contains certain “forward-looking statements” within the meaning of such term in the Private Securities Litigation Reform Act of 1995. We and our representatives may, from time to time, make written or oral statements that are “forward-looking” and provide information other than historical information. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any results, levels of activity, performance or achievements expressed or implied by any forward-looking statement. These factors include, among other things, the factors listed below. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of our management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “should,” “could,” “would,” “plans,” “goals,” “intend,” “project,” “estimate,” “forecast,” “may” or similar expressions. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those expressed in, or implied by, these statements. Readers are cautioned not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Additionally, we undertake no obligation to update any statement in light of new information or future events, except as required under federal securities law.
Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors that could have an impact on our ability to achieve operating results, growth plan goals and future prospects include, but are not limited to, the following: (1) the risks of mergers or branch sales (including the recent sale of our Florida banking operations and the acquisition of DNVB), including, without limitation, the related time and costs of implementing such transactions, integrating operations as part of these transactions and possible failures to achieve expected gains, revenue growth and/or expense savings from such transactions; (2) credit quality deterioration, pronounced and sustained reduction in real estate market values, or other uncertainties, including the impact of inflationary pressures on economic conditions and our business, resulting in an increase in the allowance for credit losses, an increase in the credit loss expense, and a reduction in net earnings; (3) the effects of sustained high interest rates, including on our net income and the value of our securities portfolio; (4) changes in the economic environment, competition, or other factors that may affect our ability to acquire loans or influence the anticipated growth rate of loans and deposits and the quality of the loan portfolio and loan and deposit pricing; (5) fluctuations in the value of our investment securities; (6) governmental monetary and fiscal policies; (7) changes in and uncertainty related to benchmark interest rates used to price loans and deposits; (8) legislative and regulatory changes, including changes in banking, securities, trade, and tax laws and regulations and their application by our regulators, and any changes in response to the recent failures of other banks; (9) the ability to attract and retain key executives and employees experienced in banking and financial services; (10) the sufficiency of the allowance for credit losses to absorb the amount of actual losses inherent in our existing loan portfolio; (11) our ability to adapt successfully to technological changes to compete effectively in the marketplace; (12) credit risks and risks from concentrations (by geographic area and by industry) within our loan portfolio; (13) the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds, financial technology companies, and other financial institutions operating in our markets or elsewhere or providing similar services; (14) the failure of assumptions underlying the establishment of allowances for credit losses and estimation of values of collateral and various financial assets and liabilities; (15) volatility of rate-sensitive deposits; (16) operational risks, including data processing system failures or fraud; (17) asset/liability matching risks and liquidity risks; (18) the costs, effects and outcomes of existing or future litigation; (19) changes in general economic, political, or industry conditions, nationally, internationally or in the communities in which we conduct business, including the risk of a recession; (20) changes in accounting policies and practices, as may be adopted by state and federal regulatory agencies and the Financial Accounting Standards Board; (21) war or terrorist activities, including the ongoing Israeli-Palestinian conflict and the Russian invasion of Ukraine, widespread disease or pandemic, or other adverse external events, which may cause deterioration in the economy or cause instability in credit markets; (22) the occurrence of fraudulent activity, breaches, or failures of our or our third-party vendors' information security controls or cyber-security related incidents, including as a result of sophisticated attacks using artificial intelligence and similar tools; (23) the imposition of tariffs or other domestic or international governmental policies impacting the value of the agricultural or other products of our borrowers; (24) potential changes in federal policy and at regulatory agencies as a result of the upcoming 2024 presidential election; (25) the concentration of large deposits from certain clients who have balances above current FDIC insurance limits; (26) the effects of recent developments and events in the financial services industry, including the large-scale deposit withdrawals over a short period of time that resulted in recent bank failures; and (27) other risk factors detailed from time to time in Securities and Exchange Commission filings made by the Company.
MIDWESTONE FINANCIAL GROUP, INC.
FIVE QUARTER CONSOLIDATED BALANCE SHEETS
June 30, | March 31, | December 31, | September 30, | June 30, | |||||||||||||||
(In thousands) | 2024 | 2024 | 2023 | 2023 | 2023 | ||||||||||||||
ASSETS | |||||||||||||||||||
Cash and due from banks | $ | 66,228 | $ | 68,430 | $ | 76,237 | $ | 71,015 | $ | 75,955 | |||||||||
Interest earning deposits in banks | 35,340 | 29,328 | 5,479 | 3,773 | 68,603 | ||||||||||||||
Federal funds sold | — | 4 | 11 | — | — | ||||||||||||||
Total cash and cash equivalents | 101,568 | 97,762 | 81,727 | 74,788 | 144,558 | ||||||||||||||
Debt securities available for sale at fair value | 771,034 | 797,230 | 795,134 | 872,770 | 903,520 | ||||||||||||||
Held to maturity securities at amortized cost | 1,053,080 | 1,064,939 | 1,075,190 | 1,085,751 | 1,099,569 | ||||||||||||||
Total securities | 1,824,114 | 1,862,169 | 1,870,324 | 1,958,521 | 2,003,089 | ||||||||||||||
Loans held for sale | 2,850 | 2,329 | 1,045 | 2,528 | 2,821 | ||||||||||||||
Gross loans held for investment | 4,304,619 | 4,433,258 | 4,138,352 | 4,078,060 | 4,031,377 | ||||||||||||||
Unearned income, net | (17,387 | ) | (18,612 | ) | (11,405 | ) | (12,091 | ) | (12,728 | ) | |||||||||
Loans held for investment, net of unearned income | 4,287,232 | 4,414,646 | 4,126,947 | 4,065,969 | 4,018,649 | ||||||||||||||
Allowance for credit losses | (53,900 | ) | (55,900 | ) | (51,500 | ) | (51,600 | ) | (50,400 | ) | |||||||||
Total loans held for investment, net | 4,233,332 | 4,358,746 | 4,075,447 | 4,014,369 | 3,968,249 | ||||||||||||||
Premises and equipment, net | 91,793 | 95,986 | 85,742 | 85,589 | 85,831 | ||||||||||||||
Goodwill | 69,388 | 71,118 | 62,477 | 62,477 | 62,477 | ||||||||||||||
Other intangible assets, net | 27,939 | 29,531 | 24,069 | 25,510 | 26,969 | ||||||||||||||
Foreclosed assets, net | 6,053 | 3,897 | 3,929 | — | — | ||||||||||||||
Other assets | 224,621 | 226,477 | 222,780 | 244,036 | 227,495 | ||||||||||||||
Total assets | $ | 6,581,658 | $ | 6,748,015 | $ | 6,427,540 | $ | 6,467,818 | $ | 6,521,489 | |||||||||
LIABILITIES | |||||||||||||||||||
Noninterest bearing deposits | $ | 882,472 | $ | 920,764 | $ | 897,053 | $ | 924,213 | $ | 897,923 | |||||||||
Interest bearing deposits | 4,529,947 | 4,664,472 | 4,498,620 | 4,439,111 | 4,547,524 | ||||||||||||||
Total deposits | 5,412,419 | 5,585,236 | 5,395,673 | 5,363,324 | 5,445,447 | ||||||||||||||
Short-term borrowings | 414,684 | 422,988 | 300,264 | 373,956 | 362,054 | ||||||||||||||
Long-term debt | 114,839 | 122,066 | 123,296 | 124,526 | 125,752 | ||||||||||||||
Other liabilities | 96,430 | 89,685 | 83,929 | 100,601 | 86,895 | ||||||||||||||
Total liabilities | 6,038,372 | 6,219,975 | 5,903,162 | 5,962,407 | 6,020,148 | ||||||||||||||
SHAREHOLDERS' EQUITY | |||||||||||||||||||
Common stock | 16,581 | 16,581 | 16,581 | 16,581 | 16,581 | ||||||||||||||
Additional paid-in capital | 300,831 | 300,845 | 302,157 | 301,889 | 301,424 | ||||||||||||||
Retained earnings | 306,030 | 294,066 | 294,784 | 295,862 | 290,548 | ||||||||||||||
Treasury stock | (22,021 | ) | (22,648 | ) | (24,245 | ) | (24,315 | ) | (24,508 | ) | |||||||||
Accumulated other comprehensive loss | (58,135 | ) | (60,804 | ) | (64,899 | ) | (84,606 | ) | (82,704 | ) | |||||||||
Total shareholders' equity | 543,286 | 528,040 | 524,378 | 505,411 | 501,341 | ||||||||||||||
Total liabilities and shareholders' equity | $ | 6,581,658 | $ | 6,748,015 | $ | 6,427,540 | $ | 6,467,818 | $ | 6,521,489 | |||||||||
MIDWESTONE FINANCIAL GROUP, INC.
FIVE QUARTER CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended | Six Months Ended | ||||||||||||||||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | June 30, | June 30, | |||||||||||||||||
(In thousands, except per share data) | 2024 | 2024 | 2023 | 2023 | 2023 | 2024 | 2023 | ||||||||||||||||
Interest income | |||||||||||||||||||||||
Loans, including fees | $ | 61,643 | $ | 57,947 | $ | 54,093 | $ | 51,870 | $ | 49,726 | $ | 119,590 | $ | 96,216 | |||||||||
Taxable investment securities | 9,228 | 9,460 | 9,274 | 9,526 | 9,734 | 18,688 | 20,178 | ||||||||||||||||
Tax-exempt investment securities | 1,663 | 1,710 | 1,789 | 1,802 | 1,822 | 3,373 | 3,949 | ||||||||||||||||
Other | 242 | 418 | 230 | 374 | 68 | 660 | 312 | ||||||||||||||||
Total interest income | 72,776 | 69,535 | 65,386 | 63,572 | 61,350 | 142,311 | 120,655 | ||||||||||||||||
Interest expense | |||||||||||||||||||||||
Deposits | 28,942 | 27,726 | 27,200 | 23,128 | 20,117 | 56,668 | 35,436 | ||||||||||||||||
Short-term borrowings | 5,409 | 4,975 | 3,496 | 3,719 | 2,118 | 10,384 | 3,904 | ||||||||||||||||
Long-term debt | 2,078 | 2,103 | 2,131 | 2,150 | 2,153 | 4,181 | 4,277 | ||||||||||||||||
Total interest expense | 36,429 | 34,804 | 32,827 | 28,997 | 24,388 | 71,233 | 43,617 | ||||||||||||||||
Net interest income | 36,347 | 34,731 | 32,559 | 34,575 | 36,962 | 71,078 | 77,038 | ||||||||||||||||
Credit loss expense | 1,267 | 4,689 | 1,768 | 1,551 | 1,597 | 5,956 | 2,530 | ||||||||||||||||
Net interest income after credit loss expense | 35,080 | 30,042 | 30,791 | 33,024 | 35,365 | 65,122 | 74,508 | ||||||||||||||||
Noninterest income | |||||||||||||||||||||||
Investment services and trust activities | 3,504 | 3,503 | 3,193 | 3,004 | 3,119 | 7,007 | 6,052 | ||||||||||||||||
Service charges and fees | 2,156 | 2,144 | 2,148 | 2,146 | 2,047 | 4,300 | 4,055 | ||||||||||||||||
Card revenue | 1,907 | 1,943 | 1,802 | 1,817 | 1,847 | 3,850 | 3,595 | ||||||||||||||||
Loan revenue | 1,525 | 856 | 909 | 1,462 | 909 | 2,381 | 2,329 | ||||||||||||||||
Bank-owned life insurance | 668 | 660 | 656 | 626 | 616 | 1,328 | 1,218 | ||||||||||||||||
Investment securities gains (losses), net | 33 | 36 | (5,696 | ) | 79 | (2 | ) | 69 | (13,172 | ) | |||||||||||||
Other | 11,761 | 608 | 850 | 727 | 210 | 12,369 | 623 | ||||||||||||||||
Total noninterest income | 21,554 | 9,750 | 3,862 | 9,861 | 8,746 | 31,304 | 4,700 | ||||||||||||||||
Noninterest expense | |||||||||||||||||||||||
Compensation and employee benefits | 20,985 | 20,930 | 17,859 | 18,558 | 20,386 | 41,915 | 39,993 | ||||||||||||||||
Occupancy expense of premises, net | 2,435 | 2,813 | 2,309 | 2,405 | 2,574 | 5,248 | 5,320 | ||||||||||||||||
Equipment | 2,530 | 2,600 | 2,466 | 2,123 | 2,435 | 5,130 | 4,606 | ||||||||||||||||
Legal and professional | 2,253 | 2,059 | 2,269 | 1,678 | 1,682 | 4,312 | 3,418 | ||||||||||||||||
Data processing | 1,645 | 1,360 | 1,411 | 1,504 | 1,521 | 3,005 | 2,884 | ||||||||||||||||
Marketing | 636 | 598 | 700 | 782 | 1,142 | 1,234 | 2,128 | ||||||||||||||||
Amortization of intangibles | 1,593 | 1,637 | 1,441 | 1,460 | 1,594 | 3,230 | 3,346 | ||||||||||||||||
FDIC insurance | 1,051 | 942 | 900 | 783 | 862 | 1,993 | 1,611 | ||||||||||||||||
Communications | 191 | 196 | 183 | 206 | 260 | 387 | 521 | ||||||||||||||||
Foreclosed assets, net | 138 | 358 | 45 | 2 | (6 | ) | 496 | (34 | ) | ||||||||||||||
Other | 2,304 | 2,072 | 2,548 | 2,043 | 2,469 | 4,376 | 4,445 | ||||||||||||||||
Total noninterest expense | 35,761 | 35,565 | 32,131 | 31,544 | 34,919 | 71,326 | 68,238 | ||||||||||||||||
Income before income tax expense | 20,873 | 4,227 | 2,522 | 11,341 | 9,192 | 25,100 | 10,970 | ||||||||||||||||
Income tax expense (benefit) | 5,054 | 958 | (208 | ) | 2,203 | 1,598 | 6,012 | 1,979 | |||||||||||||||
Net income | $ | 15,819 | $ | 3,269 | $ | 2,730 | $ | 9,138 | $ | 7,594 | $ | 19,088 | $ | 8,991 | |||||||||
Earnings per common share | |||||||||||||||||||||||
Basic | $ | 1.00 | $ | 0.21 | $ | 0.17 | $ | 0.58 | $ | 0.48 | $ | 1.21 | $ | 0.57 | |||||||||
Diluted | $ | 1.00 | $ | 0.21 | $ | 0.17 | $ | 0.58 | $ | 0.48 | $ | 1.21 | $ | 0.57 | |||||||||
Weighted average basic common shares outstanding | 15,763 | 15,723 | 15,693 | 15,689 | 15,680 | 15,743 | 15,665 | ||||||||||||||||
Weighted average diluted common shares outstanding | 15,781 | 15,774 | 15,756 | 15,711 | 15,689 | 15,775 | 15,688 | ||||||||||||||||
Dividends paid per common share | $ | 0.2425 | $ | 0.2425 | $ | 0.2425 | $ | 0.2425 | $ | 0.2425 | $ | 0.4850 | $ | 0.4850 | |||||||||
MIDWESTONE FINANCIAL GROUP, INC.
FINANCIAL STATISTICS
As of or for the Three Months Ended | As of or for the Six Months Ended | ||||||||||||||||||
June 30, | March 31, | June 30, | June 30, | June 30, | |||||||||||||||
(Dollars in thousands, except per share amounts) | 2024 | 2024 | 2023 | 2024 | 2023 | ||||||||||||||
Earnings: | |||||||||||||||||||
Net interest income | $ | 36,347 | $ | 34,731 | $ | 36,962 | $ | 71,078 | $ | 77,038 | |||||||||
Noninterest income | 21,554 | 9,750 | 8,746 | 31,304 | 4,700 | ||||||||||||||
Total revenue, net of interest expense | 57,901 | 44,481 | 45,708 | 102,382 | 81,738 | ||||||||||||||
Credit loss expense | 1,267 | 4,689 | 1,597 | 5,956 | 2,530 | ||||||||||||||
Noninterest expense | 35,761 | 35,565 | 34,919 | 71,326 | 68,238 | ||||||||||||||
Income before income tax expense | 20,873 | 4,227 | 9,192 | 25,100 | 10,970 | ||||||||||||||
Income tax expense | 5,054 | 958 | 1,598 | 6,012 | 1,979 | ||||||||||||||
Net income | $ | 15,819 | $ | 3,269 | $ | 7,594 | $ | 19,088 | $ | 8,991 | |||||||||
Per Share Data: | |||||||||||||||||||
Diluted earnings | $ | 1.00 | $ | 0.21 | $ | 0.48 | $ | 1.21 | $ | 0.57 | |||||||||
Book value | 34.44 | 33.53 | 31.96 | 34.44 | 31.96 | ||||||||||||||
Tangible book value(1) | 28.27 | 27.14 | 26.26 | 28.27 | 26.26 | ||||||||||||||
Ending Balance Sheet: | |||||||||||||||||||
Total assets | $ | 6,581,658 | $ | 6,748,015 | $ | 6,521,489 | $ | 6,581,658 | $ | 6,521,489 | |||||||||
Loans held for investment, net of unearned income | 4,287,232 | 4,414,646 | 4,018,649 | 4,287,232 | 4,018,649 | ||||||||||||||
Total securities | 1,824,114 | 1,862,169 | 2,003,089 | 1,824,114 | 2,003,089 | ||||||||||||||
Total deposits | 5,412,419 | 5,585,236 | 5,445,447 | 5,412,419 | 5,445,447 | ||||||||||||||
Short-term borrowings | 414,684 | 422,988 | 362,054 | 414,684 | 362,054 | ||||||||||||||
Long-term debt | 114,839 | 122,066 | 125,752 | 114,839 | 125,752 | ||||||||||||||
Total shareholders' equity | 543,286 | 528,040 | 501,341 | 543,286 | 501,341 | ||||||||||||||
Average Balance Sheet: | |||||||||||||||||||
Average total assets | $ | 6,713,573 | $ | 6,635,379 | $ | 6,465,810 | $ | 6,674,476 | $ | 6,494,777 | |||||||||
Average total loans | 4,419,697 | 4,298,216 | 4,003,717 | 4,358,957 | 3,935,791 | ||||||||||||||
Average total deposits | 5,514,924 | 5,481,114 | 5,454,517 | 5,498,020 | 5,500,350 | ||||||||||||||
Financial Ratios: | |||||||||||||||||||
Return on average assets | 0.95 | % | 0.20 | % | 0.47 | % | 0.58 | % | 0.28 | % | |||||||||
Return on average equity | 11.91 | % | 2.49 | % | 6.03 | % | 7.23 | % | 3.61 | % | |||||||||
Return on average tangible equity(1) | 15.74 | % | 4.18 | % | 8.50 | % | 9.98 | % | 5.65 | % | |||||||||
Efficiency ratio(1) | 56.29 | % | 71.28 | % | 71.13 | % | 62.83 | % | 66.56 | % | |||||||||
Net interest margin, tax equivalent(1) | 2.41 | % | 2.33 | % | 2.52 | % | 2.37 | % | 2.63 | % | |||||||||
Loans to deposits ratio | 79.21 | % | 79.04 | % | 73.80 | % | 79.21 | % | 73.80 | % | |||||||||
Common equity ratio | 8.25 | % | 7.83 | % | 7.69 | % | 8.25 | % | 7.69 | % | |||||||||
Tangible common equity ratio(1) | 6.88 | % | 6.43 | % | 6.40 | % | 6.88 | % | 6.40 | % | |||||||||
Credit Risk Profile: | |||||||||||||||||||
Total nonperforming loans | $ | 25,128 | $ | 29,267 | $ | 14,448 | $ | 25,128 | $ | 14,448 | |||||||||
Nonperforming loans ratio | 0.59 | % | 0.66 | % | 0.36 | % | 0.59 | % | 0.36 | % | |||||||||
Total nonperforming assets | $ | 31,181 | $ | 33,164 | $ | 14,448 | $ | 31,181 | $ | 14,448 | |||||||||
Nonperforming assets ratio | 0.47 | % | 0.49 | % | 0.22 | % | 0.47 | % | 0.22 | % | |||||||||
Net charge-offs | $ | 524 | $ | 189 | $ | 897 | $ | 713 | $ | 1,230 | |||||||||
Net charge-off ratio | 0.05 | % | 0.02 | % | 0.09 | % | 0.03 | % | 0.06 | % | |||||||||
Allowance for credit losses | $ | 53,900 | $ | 55,900 | $ | 50,400 | $ | 53,900 | $ | 50,400 | |||||||||
Allowance for credit losses ratio | 1.26 | % | 1.27 | % | 1.25 | % | 1.26 | % | 1.25 | % | |||||||||
Allowance for credit losses to nonaccrual ratio | 218.26 | % | 197.53 | % | 355.03 | % | 218.26 | % | 355.03 | % | |||||||||
(1)Non-GAAP measure. See the Non-GAAP Measures section for a reconciliation to the most directly comparable GAAP measure. | |||||||||||||||||||
MIDWESTONE FINANCIAL GROUP, INC.
AVERAGE BALANCE SHEET AND YIELD ANALYSIS
Three Months Ended | ||||||||||||||||||||||||||
June 30, 2024 | March 31, 2024 | June 30, 2023 | ||||||||||||||||||||||||
(Dollars in thousands) | Average Balance | Interest Income/ Expense | Average Yield/ Cost | Average Balance | Interest Income/ Expense | Average Yield/ Cost | Average Balance | Interest Income/ Expense | Average Yield/ Cost | |||||||||||||||||
ASSETS | ||||||||||||||||||||||||||
Loans, including fees(1)(2)(3) | $ | 4,419,697 | $ | 62,581 | 5.69 | % | $ | 4,298,216 | $ | 58,867 | 5.51 | % | $ | 4,003,717 | $ | 50,439 | 5.05 | % | ||||||||
Taxable investment securities | 1,520,253 | 9,228 | 2.44 | % | 1,557,603 | 9,460 | 2.44 | % | 1,698,003 | 9,734 | 2.30 | % | ||||||||||||||
Tax-exempt investment securities(2)(4) | 322,092 | 2,040 | 2.55 | % | 328,736 | 2,097 | 2.57 | % | 345,934 | 2,253 | 2.61 | % | ||||||||||||||
Total securities held for investment(2) | 1,842,345 | 11,268 | 2.46 | % | 1,886,339 | 11,557 | 2.46 | % | 2,043,937 | 11,987 | 2.35 | % | ||||||||||||||
Other | 20,452 | 242 | 4.76 | % | 30,605 | 418 | 5.49 | % | 9,078 | 68 | 3.00 | % | ||||||||||||||
Total interest earning assets(2) | $ | 6,282,494 | $ | 74,091 | 4.74 | % | $ | 6,215,160 | $ | 70,842 | 4.58 | % | $ | 6,056,732 | $ | 62,494 | 4.14 | % | ||||||||
Other assets | 431,079 | 420,219 | 409,078 | |||||||||||||||||||||||
Total assets | $ | 6,713,573 | $ | 6,635,379 | $ | 6,465,810 | ||||||||||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||||||||||||||||
Interest checking deposits | $ | 1,297,356 | $ | 3,145 | 0.97 | % | $ | 1,301,470 | $ | 2,890 | 0.89 | % | $ | 1,420,741 | $ | 1,971 | 0.56 | % | ||||||||
Money market deposits | 1,072,688 | 7,821 | 2.93 | % | 1,102,543 | 8,065 | 2.94 | % | 999,436 | 5,299 | 2.13 | % | ||||||||||||||
Savings deposits | 738,773 | 2,673 | 1.46 | % | 694,143 | 2,047 | 1.19 | % | 603,905 | 288 | 0.19 | % | ||||||||||||||
Time deposits | 1,470,956 | 15,303 | 4.18 | % | 1,446,981 | 14,724 | 4.09 | % | 1,490,332 | 12,559 | 3.38 | % | ||||||||||||||
Total interest bearing deposits | 4,579,773 | 28,942 | 2.54 | % | 4,545,137 | 27,726 | 2.45 | % | 4,514,414 | 20,117 | 1.79 | % | ||||||||||||||
Securities sold under agreements to repurchase | 5,300 | 10 | 0.76 | % | 5,330 | 11 | 0.83 | % | 159,583 | 423 | 1.06 | % | ||||||||||||||
Other short-term borrowings | 442,546 | 5,399 | 4.91 | % | 409,525 | 4,964 | 4.88 | % | 132,495 | 1,695 | 5.13 | % | ||||||||||||||
Total short-term borrowings | 447,846 | 5,409 | 4.86 | % | 414,855 | 4,975 | 4.82 | % | 292,078 | 2,118 | 2.91 | % | ||||||||||||||
Long-term debt | 120,256 | 2,078 | 6.95 | % | 123,266 | 2,103 | 6.86 | % | 135,329 | 2,153 | 6.38 | % | ||||||||||||||
Total borrowed funds | 568,102 | 7,487 | 5.30 | % | 538,121 | 7,078 | 5.29 | % | 427,407 | 4,271 | 4.01 | % | ||||||||||||||
Total interest bearing liabilities | $ | 5,147,875 | $ | 36,429 | 2.85 | % | $ | 5,083,258 | $ | 34,804 | 2.75 | % | $ | 4,941,821 | $ | 24,388 | 1.98 | % | ||||||||
Noninterest bearing deposits | 935,151 | 935,977 | 940,103 | |||||||||||||||||||||||
Other liabilities | 96,553 | 88,611 | 78,898 | |||||||||||||||||||||||
Shareholders’ equity | 533,994 | 527,533 | 504,988 | |||||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 6,713,573 | $ | 6,635,379 | $ | 6,465,810 | ||||||||||||||||||||
Net interest income(2) | $ | 37,662 | $ | 36,038 | $ | 38,106 | ||||||||||||||||||||
Net interest spread(2) | 1.89 | % | 1.83 | % | 2.16 | % | ||||||||||||||||||||
Net interest margin(2) | 2.41 | % | 2.33 | % | 2.52 | % | ||||||||||||||||||||
Total deposits(5) | $ | 5,514,924 | $ | 28,942 | 2.11 | % | $ | 5,481,114 | $ | 27,726 | 2.03 | % | $ | 5,454,517 | $ | 20,117 | 1.48 | % | ||||||||
Cost of funds(6) | 2.41 | % | 2.33 | % | 1.66 | % | ||||||||||||||||||||
(1) Average balance includes nonaccrual loans. | ||||||||||||||||||||||||||
(2) Tax equivalent. The federal statutory tax rate utilized was | ||||||||||||||||||||||||||
(3) Interest income includes net loan fees, loan purchase discount accretion and tax equivalent adjustments. Net loan fees were | ||||||||||||||||||||||||||
(4) Interest income includes tax equivalent adjustments of | ||||||||||||||||||||||||||
(5) Total deposits is the sum of total interest-bearing deposits and noninterest bearing deposits. The cost of total deposits is calculated as annualized interest expense on deposits divided by average total deposits. | ||||||||||||||||||||||||||
(6) Cost of funds is calculated as annualized total interest expense divided by the sum of average total deposits and borrowed funds. | ||||||||||||||||||||||||||
MIDWESTONE FINANCIAL GROUP, INC.
AVERAGE BALANCE SHEET AND YIELD ANALYSIS
Six Months Ended | |||||||||||||||||
June 30, 2024 | June 30, 2023 | ||||||||||||||||
(Dollars in thousands) | Average Balance | Interest Income/ Expense | Average Yield/ Cost | Average Balance | Interest Income/ Expense | Average Yield/ Cost | |||||||||||
ASSETS | |||||||||||||||||
Loans, including fees(1)(2)(3) | $ | 4,358,957 | $ | 121,448 | 5.60 | % | $ | 3,935,791 | $ | 97,645 | 5.00 | % | |||||
Taxable investment securities | 1,538,928 | 18,688 | 2.44 | % | 1,754,382 | 20,178 | 2.32 | % | |||||||||
Tax-exempt investment securities(2)(4) | 325,414 | 4,137 | 2.56 | % | 371,381 | 4,902 | 2.66 | % | |||||||||
Total securities held for investment(2) | 1,864,342 | 22,825 | 2.46 | % | 2,125,763 | 25,080 | 2.38 | % | |||||||||
Other | 25,529 | 660 | 5.20 | % | 16,919 | 312 | 3.72 | % | |||||||||
Total interest earning assets(2) | $ | 6,248,828 | $ | 144,933 | 4.66 | % | $ | 6,078,473 | $ | 123,037 | 4.08 | % | |||||
Other assets | 425,648 | 416,304 | |||||||||||||||
Total assets | $ | 6,674,476 | $ | 6,494,777 | |||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||
Interest checking deposits | $ | 1,299,413 | $ | 6,035 | 0.93 | % | $ | 1,468,030 | $ | 3,820 | 0.52 | % | |||||
Money market deposits | 1,087,616 | 15,886 | 2.94 | % | 965,180 | 8,568 | 1.79 | % | |||||||||
Savings deposits | 716,458 | 4,720 | 1.32 | % | 628,338 | 560 | 0.18 | % | |||||||||
Time deposits | 1,458,969 | 30,027 | 4.14 | % | 1,454,210 | 22,488 | 3.12 | % | |||||||||
Total interest bearing deposits | 4,562,456 | 56,668 | 2.50 | % | 4,515,758 | 35,436 | 1.58 | % | |||||||||
Securities sold under agreements to repurchase | 5,315 | 21 | 0.79 | % | 152,734 | 873 | 1.15 | % | |||||||||
Other short-term borrowings | 426,036 | 10,363 | 4.89 | % | 121,959 | 3,031 | 5.01 | % | |||||||||
Total short-term borrowings | 431,351 | 10,384 | 4.84 | % | 274,693 | 3,904 | 2.87 | % | |||||||||
Long-term debt | 121,761 | 4,181 | 6.91 | % | 137,258 | 4,277 | 6.28 | % | |||||||||
Total borrowed funds | 553,112 | 14,565 | 5.30 | % | 411,951 | 8,181 | 4.00 | % | |||||||||
Total interest bearing liabilities | $ | 5,115,568 | $ | 71,233 | 2.80 | % | $ | 4,927,709 | $ | 43,617 | 1.78 | % | |||||
Noninterest bearing deposits | 935,564 | 984,592 | |||||||||||||||
Other liabilities | 92,581 | 80,690 | |||||||||||||||
Shareholders’ equity | 530,763 | 501,786 | |||||||||||||||
Total liabilities and shareholders’ equity | $ | 6,674,476 | $ | 6,494,777 | |||||||||||||
Net interest income(2) | $ | 73,700 | $ | 79,420 | |||||||||||||
Net interest spread(2) | 1.86 | % | 2.30 | % | |||||||||||||
Net interest margin(2) | 2.37 | % | 2.63 | % | |||||||||||||
Total deposits(5) | $ | 5,498,020 | $ | 56,668 | 2.07 | % | $ | 5,500,350 | $ | 35,436 | 1.30 | % | |||||
Cost of funds(6) | 2.37 | % | 1.49 | % | |||||||||||||
(1) Average balance includes nonaccrual loans. | |||||||||||||||||
(2) Tax equivalent. The federal statutory tax rate utilized was | |||||||||||||||||
(3) Interest income includes net loan fees, loan purchase discount accretion and tax equivalent adjustments. Net loan fees were | |||||||||||||||||
(4) Interest income includes tax equivalent adjustments of | |||||||||||||||||
(5) Total deposits is the sum of total interest-bearing deposits and noninterest bearing deposits. The cost of total deposits is calculated as annualized interest expense on deposits divided by average total deposits. | |||||||||||||||||
(6) Cost of funds is calculated as annualized total interest expense divided by the sum of average total deposits and borrowed funds. | |||||||||||||||||
Non-GAAP Measures
This earnings release contains non-GAAP measures for tangible common equity, tangible book value per share, tangible common equity ratio, return on average tangible equity, net interest margin (tax equivalent), core net interest margin, loan yield (tax equivalent), core yield on loans, and efficiency ratio. Management believes these measures provide investors with useful information regarding the Company’s profitability, financial condition and capital adequacy, consistent with how management evaluates the Company’s financial performance. The following tables provide a reconciliation of each non-GAAP measure to the most comparable GAAP measure.
Tangible Common Equity/Tangible Book Value | ||||||||||||||||||||
per Share/Tangible Common Equity Ratio | June 30, | March 31, | December 31, | September 30, | June 30, | |||||||||||||||
(Dollars in thousands, except per share data) | 2024 | 2024 | 2023 | 2023 | 2023 | |||||||||||||||
Total shareholders’ equity | $ | 543,286 | $ | 528,040 | $ | 524,378 | $ | 505,411 | $ | 501,341 | ||||||||||
Intangible assets, net | (97,327 | ) | (100,649 | ) | (86,546 | ) | (87,987 | ) | (89,446 | ) | ||||||||||
Tangible common equity | $ | 445,959 | $ | 427,391 | $ | 437,832 | $ | 417,424 | $ | 411,895 | ||||||||||
Total assets | $ | 6,581,658 | $ | 6,748,015 | $ | 6,427,540 | $ | 6,467,818 | $ | 6,521,489 | ||||||||||
Intangible assets, net | (97,327 | ) | (100,649 | ) | (86,546 | ) | (87,987 | ) | (89,446 | ) | ||||||||||
Tangible assets | $ | 6,484,331 | $ | 6,647,366 | $ | 6,340,994 | $ | 6,379,831 | $ | 6,432,043 | ||||||||||
Book value per share | $ | 34.44 | $ | 33.53 | $ | 33.41 | $ | 32.21 | $ | 31.96 | ||||||||||
Tangible book value per share(1) | $ | 28.27 | $ | 27.14 | $ | 27.90 | $ | 26.60 | $ | 26.26 | ||||||||||
Shares outstanding | 15,773,468 | 15,750,471 | 15,694,306 | 15,691,738 | 15,685,123 | |||||||||||||||
Common equity ratio | 8.25 | % | 7.83 | % | 8.16 | % | 7.81 | % | 7.69 | % | ||||||||||
Tangible common equity ratio(2) | 6.88 | % | 6.43 | % | 6.90 | % | 6.54 | % | 6.40 | % | ||||||||||
(1) Tangible common equity divided by shares outstanding. | ||||||||||||||||||||
(2) Tangible common equity divided by tangible assets. | ||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
Return on Average Tangible Equity | June 30, | March 31, | June 30, | June 30, | June 30, | |||||||||||||||
(Dollars in thousands) | 2024 | 2024 | 2023 | 2024 | 2023 | |||||||||||||||
Net income | $ | 15,819 | $ | 3,269 | $ | 7,594 | $ | 19,088 | $ | 8,991 | ||||||||||
Intangible amortization, net of tax(1) | 1,195 | 1,228 | 1,196 | 2,423 | 2,510 | |||||||||||||||
Tangible net income | $ | 17,014 | $ | 4,497 | $ | 8,790 | $ | 21,511 | $ | 11,501 | ||||||||||
Average shareholders’ equity | $ | 533,994 | $ | 527,533 | $ | 504,988 | $ | 530,763 | $ | 501,786 | ||||||||||
Average intangible assets, net | (99,309 | ) | (95,296 | ) | (90,258 | ) | (97,302 | ) | (91,125 | ) | ||||||||||
Average tangible equity | $ | 434,685 | $ | 432,237 | $ | 414,730 | $ | 433,461 | $ | 410,661 | ||||||||||
Return on average equity | 11.91 | % | 2.49 | % | 6.03 | % | 7.23 | % | 3.61 | % | ||||||||||
Return on average tangible equity(2) | 15.74 | % | 4.18 | % | 8.50 | % | 9.98 | % | 5.65 | % | ||||||||||
(1) The combined income tax rate utilized was | ||||||||||||||||||||
(2) Annualized tangible net income divided by average tangible equity. | ||||||||||||||||||||
Net Interest Margin, Tax Equivalent/ Core Net Interest Margin | Three Months Ended | Six Months Ended | ||||||||||||||||||
June 30, | March 31, | June 30, | June 30, | June 30, | ||||||||||||||||
(Dollars in thousands) | 2024 | 2024 | 2023 | 2024 | 2023 | |||||||||||||||
Net interest income | $ | 36,347 | $ | 34,731 | $ | 36,962 | $ | 71,078 | $ | 77,038 | ||||||||||
Tax equivalent adjustments: | ||||||||||||||||||||
Loans(1) | 938 | 920 | 713 | 1,858 | 1,429 | |||||||||||||||
Securities(1) | 377 | 387 | 431 | 764 | 953 | |||||||||||||||
Net interest income, tax equivalent | $ | 37,662 | $ | 36,038 | $ | 38,106 | $ | 73,700 | $ | 79,420 | ||||||||||
Loan purchase discount accretion | (1,261 | ) | (1,152 | ) | (984 | ) | (2,413 | ) | (2,173 | ) | ||||||||||
Core net interest income | $ | 36,401 | $ | 34,886 | $ | 37,122 | $ | 71,287 | $ | 77,247 | ||||||||||
Net interest margin | 2.33 | % | 2.25 | % | 2.45 | % | 2.29 | % | 2.56 | % | ||||||||||
Net interest margin, tax equivalent(2) | 2.41 | % | 2.33 | % | 2.52 | % | 2.37 | % | 2.63 | % | ||||||||||
Core net interest margin(3) | 2.33 | % | 2.26 | % | 2.46 | % | 2.29 | % | 2.56 | % | ||||||||||
Average interest earning assets | $ | 6,282,494 | $ | 6,215,160 | $ | 6,056,732 | $ | 6,248,828 | $ | 6,078,473 | ||||||||||
(1) The federal statutory tax rate utilized was | ||||||||||||||||||||
(2) Annualized tax equivalent net interest income divided by average interest earning assets. | ||||||||||||||||||||
(3) Annualized core net interest income divided by average interest earning assets. | ||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
Loan Yield, Tax Equivalent / Core Yield on Loans | June 30, | March 31, | June 30, | June 30, | June 30, | |||||||||||||||
(Dollars in thousands) | 2024 | 2024 | 2023 | 2024 | 2023 | |||||||||||||||
Loan interest income, including fees | $ | 61,643 | $ | 57,947 | $ | 49,726 | $ | 119,590 | $ | 96,216 | ||||||||||
Tax equivalent adjustment(1) | 938 | 920 | 713 | 1,858 | 1,429 | |||||||||||||||
Tax equivalent loan interest income | $ | 62,581 | $ | 58,867 | $ | 50,439 | $ | 121,448 | $ | 97,645 | ||||||||||
Loan purchase discount accretion | (1,261 | ) | (1,152 | ) | (984 | ) | (2,413 | ) | (2,173 | ) | ||||||||||
Core loan interest income | $ | 61,320 | $ | 57,715 | $ | 49,455 | $ | 119,035 | $ | 95,472 | ||||||||||
Yield on loans | 5.61 | % | 5.42 | % | 4.98 | % | 5.52 | % | 4.93 | % | ||||||||||
Yield on loans, tax equivalent(2) | 5.69 | % | 5.51 | % | 5.05 | % | 5.60 | % | 5.00 | % | ||||||||||
Core yield on loans(3) | 5.58 | % | 5.40 | % | 4.95 | % | 5.49 | % | 4.89 | % | ||||||||||
Average loans | $ | 4,419,697 | $ | 4,298,216 | $ | 4,003,717 | $ | 4,358,957 | $ | 3,935,791 | ||||||||||
(1) The federal statutory tax rate utilized was | ||||||||||||||||||||
(2) Annualized tax equivalent loan interest income divided by average loans. | ||||||||||||||||||||
(3) Annualized core loan interest income divided by average loans. | ||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
Efficiency Ratio | June 30, | March 31, | June 30, | June 30, | June 30, | |||||||||||||||
(Dollars in thousands) | 2024 | 2024 | 2023 | 2024 | 2023 | |||||||||||||||
Total noninterest expense | $ | 35,761 | $ | 35,565 | $ | 34,919 | $ | 71,326 | $ | 68,238 | ||||||||||
Amortization of intangibles | (1,593 | ) | (1,637 | ) | (1,594 | ) | (3,230 | ) | (3,346 | ) | ||||||||||
Merger-related expenses | (854 | ) | (1,314 | ) | — | (2,168 | ) | (136 | ) | |||||||||||
Noninterest expense used for efficiency ratio | $ | 33,314 | $ | 32,614 | $ | 33,325 | $ | 65,928 | $ | 64,756 | ||||||||||
Net interest income, tax equivalent(1) | $ | 37,662 | $ | 36,038 | $ | 38,106 | $ | 73,700 | $ | 79,420 | ||||||||||
Plus: Noninterest income | 21,554 | 9,750 | 8,746 | 31,304 | 4,700 | |||||||||||||||
Less: Investment securities (losses) gains, net | 33 | 36 | (2 | ) | 69 | (13,172 | ) | |||||||||||||
Net revenues used for efficiency ratio | $ | 59,183 | $ | 45,752 | $ | 46,854 | $ | 104,935 | $ | 97,292 | ||||||||||
Efficiency ratio(2) | 56.29 | % | 71.28 | % | 71.13 | % | 62.83 | % | 66.56 | % | ||||||||||
(1) The federal statutory tax rate utilized was | ||||||||||||||||||||
(2) Noninterest expense adjusted for amortization of intangibles and merger-related expenses divided by the sum of tax equivalent net interest income, noninterest income and net investment securities gains. | ||||||||||||||||||||
Category: Earnings
This news release may be downloaded from https://www.midwestonefinancial.com/corporate-profile/default.aspx
Source: MidWestOne Financial Group, Inc.
Industry: Banks
Contact: | |||
Charles N. Reeves | Barry S. Ray | ||
Chief Executive Officer | Chief Financial Officer | ||
319.356.5800 | 319.356.5800 |
FAQ
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