Midland States Bancorp, Inc. · NASDAQ:MSBI
Midland States Bancorp — Q1 2017 Earnings Presentation
18 slides from Midland States Bancorp's earnings presentation, Apr 27, 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
2 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, expe
Slide 3: First Quarter 2017 Summary
First Quarter 2017 Summary 3 Robust Loan Growth Operational Excellence Strong Earnings Wealth Management Acquisition Net income of $8.5 million or $0.52 per diluted share Total loans increased 23% on an annualized basis Expanded Wealth Management business with acquisition of CedarPoint Investment Ad
Slide 4: Business Unit Review - Love Funding
$6.2 $7.8 $3.8 $3.9 $6.4 $0.3 $0.8 ($0.5) ($0.2) $0.3 1Q 2016 2Q 2016 3Q 2016 4Q 2016 1Q 2017 Gain Servicing $227 $281 $73 $159 $217 1Q 2016 2Q 2016 3Q 2016 4Q 2016 1Q 2017 Loan Rate Locks • Commercial FHA origination and servicing business focused on multifamily and healthcare facilities • Long - t
Slide 5: Business Unit Review - Residential Mortgage
Business Unit Review - Residential Mortgage Purchase / Refinance Mix 5 • 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 (in millions) 56% 70% 62% 63%
Slide 6: Business Unit Review - Heartland Business Credit
$26.5 $32.8 $22.1 $29.1 $22.4 1Q 2016 2Q 2016 3Q 2016 4Q 2016 1Q 2017 New Originations Business Unit Review - Heartland Business Credit 6 • Equipment leasing sourced from a network of equipment manufacturers and brokers • Strong production with $22 million in originations • Attractive yields – avera
Slide 7: Business Unit Review - Wealth Management
$1.79 $1.87 $1.94 $2.50 $2.87 1Q 2016 2Q 2016 3Q 2016 4Q 2016 1Q 2017 $1,190 $1,198 $1,235 $1,658 $1,869 1Q 2016 2Q 2016 3Q 2016 4Q 2016 1Q 2017 • Wealth Management group offers Trust and Estate services, Investment Management, Financial Planning and Employer Sponsored Retirement Plans • Assets unde
Slide 8: 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 Interest Income/Margin NIM /
Slide 9: Non-Interest Income
Non - Interest Income 9 • Fee generating businesses drive 37% of total revenue in 1Q17 Non - Interest Income (in millions) $12.6 $14.0 $14.9 $30.5 $16.3 1Q 2016 2Q 2016 3Q 2016 4Q 2016 1Q 2017 Commercial FHA Residential Mortgage Wealth Management Gain on Sale of CMOs All other, net
Slide 10: Non-Interest Expense and Operating Efficiency
Non - Interest Expense and Operating Efficiency 10 • Efficiency Ratio 1 decreased to 66% in 1Q17 vs. 77% in 4Q16 • $1.3 million in integration and acquisition - related expenses in 1Q17 • Excluding integration and acquisition - related expenses and branch network optimization charges in 1Q17, nonint
Slide 11: Loan Portfolio
Loan Portfolio Total Loans 11 • 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
Slide 12: Total Deposits
Total Deposits Total Deposits 12 • 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 (in millions
Slide 13: Asset Quality
Asset Quality NCO / Average Loans 13 • 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 (Total Loans as of quarte
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 unt
Slide 15: Appendix
APPENDIX
Slide 16: Adjusted Earnings Reconciliation
16 (dollars in thousands, except per share data) Adjusted Earnings Reconciliation Income before income taxes - GAAP $ 11,473 $ 19,910 $ 12,153 $ 10,472 $ 7,896 Adjustments to other income: Gain on sales of investment securities, net 67 14,387 39 72 204 Other than-temporary-impairment on investment s
Slide 17: Tangible Common Equity to Tangible Assets Ratio and Tangible Book Value Per Share
17 Tangible Common Equity to Tangible Assets Ratio and Tangible Book Value Per Share (dollars in thousands, except per share data) Shareholders' Equity to Tangible Common Equity Total shareholders' equity—GAAP $ 334,333 $ 321,770 $ 321,749 $ 316,268 $ 238,386 Adjustments: Goodwill (50,807) (48,836)
Slide 18: Additional Information
18 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 prospec
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