Midland States Bancorp, Inc. · NASDAQ:MSBI
Midland States Bancorp — Q3 2017 Earnings Presentation
15 slides from Midland States Bancorp's earnings presentation, 2017
Slide 1: Midland States Bancorp, Inc. Third Quarter 2017 Earnings Call
Midland States Bancorp, Inc. NASDAQ: MSBI Third Quarter 2017 Earnings Call
Slide 2: Forward-Looking Statements
Forward-Looking Statements. This presentation may contain forward-looking statements within the meaning of the federal securities laws. Forward-looking statements express management’s current expectations, forecasts of future events or long-term goals, and may be based upon beliefs, expectations and
Slide 3: Overview of 3Q17 and Recent Developments
Overview of 3Q17 and Recent Developments Announced on October 16, 2017 • Leading market share in Rockford, IL MSA Alpine Acquisition • $1.3 billion in total assets • $1.0 billion wealth management business System conversion completed in third quarter Centrue Integration • On track to realize project
Slide 4: Net Interest Income/Margin
Net Interest Income/Margin • Net interest income increased 25% from 2Q17, primarily due to the full quarter impact of Centrue • Net interest margin, excluding accretion income, declined 6 bps, due to full quarter impact of Centrue’s lower yielding assets • Average rate on new and renewed loans incre
Slide 5: Non-Interest Income
Non-Interest Income • Fee generating businesses accounted for 30% of total revenue in 3Q17 • Fee income increased 13.1% from 2Q17 due to full quarter impact of Centrue • Strong growth in deposit service charges and interchange revenue Non-Interest Income (in millions) $30.5 $16.3 $14.9 $15.4 $13.6 3
Slide 6: Wealth Management
Wealth Management • Wealth Management group offers Trust and Estate services, Investment Management, Financial Planning and Employer Sponsored Retirement Plans • Surpassed $2 billion in assets under administration • Total revenue increased 2% from the prior quarter • Year-over-year organic growth in
Slide 7: Love Funding – Commercial FHA Revenue
Love Funding – Commercial FHA Revenue • Commercial FHA origination and servicing business for multifamily and healthcare facilities • Long-term replacement reserve deposits for maintenance/capex of properties and escrow deposits are low-cost sources of funds • Annual revenue expected to be $18-$20 m
Slide 8: Non-Interest Expense and Operating Efficiency
Non-Interest Expense and Operating Efficiency Non-Interest Expense and Efficiency Ratio1 • Efficiency Ratio1 was 69.0% (Non-Interest expense in millions) in 3Q17 vs. 66.5% in 2Q17 • Integration and acquisition related expenses $48.4 $8.3 million in 3Q17 $7.5 million in 2Q17 • 3Q17 expenses inclu
Slide 9: Loan Portfolio
Loan Portfolio • Total loans declined $26 million during 3Q17 • Elevated payoffs in commercial portfolio largely from companies or properties that were sold, as well as lower rated credits exiting the bank • Continued growth in residential real estate, consumer and construction portfolios Loan Portf
Slide 10: Total Deposits
Total Deposits • Average community banking deposits trended higher throughout 3Q17 • Repositioning of non-core funding sources as brokered CDs replaced with lower-cost FHLB advances • $108 million fluctuation in end-of-period servicing deposits • Total deposits declined $219 million in 3Q17 Deposit
Slide 11: Asset Quality
Asset Quality • Non-performing loans increased due to downgrade of one commercial real estate loan • Net charge-offs totaled $0.1 million in 3Q17, or 1 bp of average loans • Provision for loan losses of $1.5 million in 3Q17 • ALL + credit marks/total loans of 0.99% at September 30, 2017 Non-performi
Slide 12: Outlook
Outlook • Accretive acquisitions continue to drive shareholder value • Significant increase in scale and deeper presence throughout Illinois • Recurring revenue of wealth management becoming larger percentage of revenue mix • Expanded base of low-cost deposits • Midland positioned to be a higher per
Slide 13: Appendix
APPENDIX
Slide 14: Reconciliations of Non-GAAP Financial Measures
MIDLAND STATES BANCORP, INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES For the Quarter Ended September 30, June 30, March 31, December 31, September 30, (in thousands, except per share data) 2017 2017 2017 2016 2016 Adjusted Earnings Reconciliation Income before income taxes - GAAP $ 2,316 $ 4,
Slide 15: Reconciliations of Non-GAAP Financial Measures: Tangible Common Equity
MIDLAND STATES BANCORP, INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES Tangible Common Equity to Tangible Assets Ratio and Tangible Book Value Per Share As of Se pte mbe r 30, June 30, March 31, De ce mbe r 31, Se pte mbe r 30, (dollars in thousands, except per share data) 2017 2017 2017 2016 2
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