Midland States Bancorp, Inc. · NASDAQ:MSBI
Midland States Bancorp — Q1 2017 Earnings Presentation
18 slides from Midland States Bancorp's earnings presentation, 2017
Slide 1: Midland States Bancorp, Inc. First Quarter 2017 Earnings Call
Midland States Bancorp, Inc. NASDAQ: MSBI First 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: First Quarter 2017 Summary
First Quarter 2017 Summary Strong Earnings Net income of $8.5 million or $0.52 per diluted share Positive Trends in Strong loan growth, expanding NIM, higher non-interest income, greater efficiencies and Key Metrics improvement in credit quality Robust Loan Growth Total loans increased 23% on an ann
Slide 4: Business Unit Review - Love Funding
Business Unit Review - Love Funding • Commercial FHA origination and servicing business focused on multifamily and healthcare facilities • Long-term replacement reserve deposits for maintenance/capex of properties and escrow deposits are low-cost sources of funds • Originated $217 million in rate lo
Slide 5: Business Unit Review - Residential Mortgage
Business Unit Review - Residential Mortgage • Residential mortgage loan origination and servicing • $77 million in mortgage rate locks on loans originated for sale • 1Q17 net gain on sale reflects the seasonally lower activity Net Gain on Sale Purchase / Refinance Mix (in millions) 23% 27% $145 37%
Slide 6: Business Unit Review - Heartland Business Credit
Business Unit Review - Heartland Business Credit • Equipment leasing sourced from a network of equipment manufacturers and brokers • Strong production with $22 million in originations • Attractive yields – average rate (ex. accretion) on lease finance portfolio was 5.44% • 25% portfolio growth vs. 1
Slide 7: Business Unit Review – Wealth Management
Business Unit Review – Wealth Management • Wealth Management group offers Trust and Estate services, Investment Management, Financial Planning and Employer Sponsored Retirement Plans • Assets under administration increased by $211 million, or 13% from 4Q16 • Excluding CedarPoint acquisition, assets
Slide 8: Net Interest Income/Margin
Net Interest Income/Margin • Net interest income increased 5.8% from 4Q16 primarily due to higher interest income on loans due to strong loan growth and higher net interest margin • Net interest margin, excluding accretion income, increased by 10 basis points, due to higher average loan yields Net I
Slide 9: Non-Interest Income
Non-Interest Income • Fee generating businesses drive 37% of total revenue in 1Q17 Non-Interest Income (in millions) $30.5 $16.3 $14.9 $14.0 $12.6 1Q 2016 2Q 2016 3Q 2016 4Q 2016 1Q 2017 Commercial FHA Residential Mortgage Wealth Management Gain on Sale of CMOs All other, net 9
Slide 10: Non-Interest Expense and Operating Efficiency
Non-Interest Expense and Operating Efficiency Non-Interest Expense and Efficiency Ratio1 • Efficiency Ratio1 decreased (Non-Interest expense in millions) to 66% in 1Q17 vs. 77% in 4Q16 $34.1 • $1.3 million in integration and $30.9 77% $30.8 acquisition-related expenses $28.7 in 1Q17 $27.6 • Excludin
Slide 11: Loan Portfolio
Loan Portfolio • Total loans at quarter end increased by $135 million in 1Q17 vs. 4Q16 • Increases across all major portfolios with the strongest growth coming from commercial real estate, residential real estate and consumer loan portfolios • Growth in the consumer loan portfolio was primarily driv
Slide 12: Total Deposits
Total Deposits • Total deposits at quarter end increased by $123 million in 1Q17 vs. 4Q16 • Majority of growth came in checking accounts and money market accounts • Increased the level of brokered deposits in 1Q17 to support the strong growth in total loans Deposit Mix Total Deposits (in millions, a
Slide 13: Asset Quality
Asset Quality • Non-performing loans decreased by $2.7 million from 4Q16 • Net charge-offs totaled $0.6 million in 1Q17, or 10 bps of average loans • Recorded a provision for loan losses of $1.5 million in 1Q17 Non-performing Loans / Total Loans NCO / Average Loans (Total Loans as of quarter-end) 1.
Slide 14: Outlook
Outlook • Economic conditions in our markets remain healthy • Expect continuation of positive trends in revenue growth and credit quality • Centrue acquisition on track to close in mid-2017 • Investment in resources needed to execute the Centrue integration will result in higher expense levels until
Slide 15: Appendix
APPENDIX
Slide 16: Reconciliations of Non-GAAP Financial Measures
MIDLAND STATES BANCORP, INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES For the Quarter Ended March 31, December 31, September 30, June 30, March 31, (dollars in thousands, except per share data) 2017 2016 2016 2016 2016 Adjusted Earnings Reconciliation Income before income taxes - GAAP $ 11,473
Slide 17: 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 March 31, December 31, September 30, June 30, March 31, (dollars in thousands, except per share data) 2017 2016 2016 2016 2016 Sharehold
Slide 18: Additional Information
Additional Information. Midland has filed a registration statement on Form S-4 with the Securities and Exchange Commission (SEC) in connection with its proposed acquisition of Centrue. The registration statement includes a proxy statement of Midland and Centrue that also constitutes a prospectus of
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