Midland States Bancorp, Inc. · NASDAQ:MSBI
Midland States Bancorp — Q4 2021 Earnings Presentation
24 slides from Midland States Bancorp's earnings presentation, 2022
Slide 1: Fourth Quarter 2021 Earnings Call
Midland States Bancorp, Inc. NASDAQ: MSBI Fourth Quarter 2021 Earnings Call 1
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 expressing management’s current expectations, forecasts of future events or long-term goals may be based upon beliefs, expectations and a
Slide 3: Overview of 4Q21
Overview of 4Q21 • Net income of $23.1 million, or $1.02 diluted EPS • 4Q21 results included a $4.9 million FHLB advance prepayment penalty and a $1.8 million gain on 4Q21 Earnings termination of interest rate swap • Adjusted pre-tax, pre-provision earnings(1) of $36.3 million, up from $28.4 million
Slide 4: Loan Portfolio
Loan Portfolio • Total loans increased $309.2 million from prior quarter to $5.22 billion • Growth in CRE loans, conventional commercial loans, and consumer loans offset lower end of period balances on commercial FHA warehouse credit lines and lower PPP loans • Equipment finance balances increased $
Slide 5: Midland Equipment Finance Portfolio Overview
Midland Equipment Finance Portfolio Overview Portfolio Characteristics Total Deferred (as of 12/31/21) Loans and Leases Nationwide portfolio providing financing solutions As of As of As of to equipment vendors and end-users 6/30/21 9/30/21 12/31/21 Total Outstanding $945.2 million Loans and Leases (
Slide 6: GreenSky Consumer Loan Portfolio Overview
GreenSky Consumer Loan Portfolio Overview Portfolio Characteristics Prime Credit (as of 12/31/21) Average FICO score of 771 $874.5 million Total Outstanding (16.7% of total loans) No losses to MSBI in 10 year history of portfolio Number of Loans 412,663 Average Loan Size $2,119 Credit Enhancemen
Slide 7: Total Deposits
Total Deposits • Total deposits increased $509.3 million, or 9.1% from prior quarter, to $6.11 billion • Increase in deposits largely attributable to increase in commercial FHA servicing deposits and other commercial deposits • Noninterest-bearing deposits increased to 36.8% of total deposits at Dec
Slide 8: Net Interest Income/Margin
Net Interest Income/Margin • Net interest income increased 5.7% from the prior quarter due primarily to higher average earning assets • Net interest margin, excluding accretion income, decreased 6 bps from prior quarter due primarily to an increase in liquidity resulting from growth in commercial FH
Slide 9: Wealth Management
Wealth Management • During 4Q21, assets under administration increased $159.2 million, primarily due to market performance • Wealth Management revenue was consistent with prior quarter, as a decrease in estate and guardianship fees offset the increase in AUA Assets Under Administration Wealth Manage
Slide 10: Noninterest Income
Noninterest Income • Noninterest income increased 48.7% from prior quarter • Impairment on commercial MSRs impacted noninterest income by $2.1 million and $3.0 million in 4Q21 and 3Q21, respectively • Excluding the impact of the impairment of commercial MSRs, noninterest income increased 35.3% prima
Slide 11: Noninterest Expense and Operating Efficiency
Noninterest Expense and Operating Efficiency Noninterest Expense and Efficiency Ratio (1) • Efficiency Ratio (1) was 52.6% in 4Q21 vs. 58.8% in 3Q21 (Noninterest expense in millions) • Adjustments to non-interest expense: $55.0 70.0% ($ in millions) 4Q21 3Q21 $50.0 $48.9 Integration and ($0.2) ($0.2
Slide 12: Asset Quality
Asset Quality • Nonperforming loans decreased $12.0 million primarily due to the payoff of two non-accrual loans and the charge-off of a third non-accrual loan • Net charge-offs of $4.6 million, or 0.37% of average loans • Charge-offs primarily related to one acquired loan and equipment finance cred
Slide 13: Changes in Allowance for Credit Losses
Changes in Allowance for Credit Losses ($ in thousands) Specific Portfolio Economic Reserves Changes Factors Changes to specific reserves New loans Changes to macro- economic variables Changes in credit and forecasts quality including risk ratings and Changes to other deferrals economic qu
Slide 14: ACL by Portfolio
ACL by Portfolio ($ in thousands) Total Loans at % of Total Loans at % of Portfolio ACL ACL 12/31/21 Total Loans 9/30/21 Total Loans Commercial $ 770,670 $ 5,783 0.75% $ 799,189 $ 6,360 0.80% Warehouse Lines 91,927 - 0.00% 180,248 - 0.00% Commercial Other 679,518 8,592 1.26% 668,146 8,231 1.23% Equi
Slide 15: 2022 Outlook and Priorities
2022 Outlook and Priorities • Current expectation is to now continue participation in GreenSky partnership through at least 2023 New fintech partnership should provide $200-$250 million in loans over next 2-3 years • High-single-digit loan growth expected in 2022 Continued momentum of more produ
Slide 16: Appendix
APPENDIX Midland [=] States Bancorp, Inc.
Slide 17: Paycheck Protection Program Overview
Paycheck Protection Program Overview Paycheck Protection Program Paycheck Protection Program (as of 12/31/21) Loan Forgiveness Loans Outstanding $52.5 million As of 9/30/21 As of 12/31/21 Round 1 $5.3 million Loans Submitted to SBA $313.9 million $342.4 million Round 2 $47.2 million Loans Forgiven b
Slide 18: Loan Deferral Overview
Loan Deferral Overview Total Loan Deferrals Deferral Type (as of December 31, 2021) As of As of As of Jun. 30, 2021 Sep. 30, 2021 Dec. 31, 2021 Full Payment Deferral $1.4 million Total Loans Deferred $107.3 million $34.3 million $13.3 million Deferred Loans Making $11.9 million % of Total Loans 2.2%
Slide 19: Commercial Loans and Leases by Industry
Commercial Loans and Leases by Industry Industries as a percentage of Commercial, Wholesale Trade Health Care CRE and Equipment Finance Loans and Leases Other Services as of 12/31/21 2.8% 2.4% 2.9% General Freight Trucking 4.1% RE / Rental & Leasing 21.9% Retail Trade 4.1% Trans. / Ground Passenger
Slide 20: Commercial Real Estate Portfolio by Collateral Type
Commercial Real Estate Portfolio by Collateral Type Collateral type as a percentage of the Industrial / Warehouse Commercial Real Estate and Construction Office 7.8% Portfolio as of 12/31/21 6.6% All Others Hotel/Motel 5.1% 8.3% Residential 1-4 Family 4.0% Farmland 3.4% C-Store / Gas Station Multi-F
Slide 21: Capital and Liquidity Overview
Capital and Liquidity Overview Capital Ratios Liquidity Sources (as of 12/31/21) (as of 12/31/21) 15.00% ($ in millions) Cash and Cash Equivalents $ 673.3 12.19% Unpledged Securities 409.1 FHLB Committed Liquidity 863.7 11.21% FRB Discount Window Availability 55.9 10.49% 10.49% Total Estimated Liqui
Slide 22: Reconciliations of Non-GAAP Financial Measures: Adjusted Earnings
MIDLAND STATES BANCORP, INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES (unaudited) Adjusted Earnings Reconciliation For the Quarter Ended December 31, September 30, June 30, March 31, December 31, (dollars in thousands, except per share data) 2021 2021 2021 2021 2020 Income before income taxes
Slide 23: Reconciliations of Non-GAAP Financial Measures: Efficiency Ratio
MIDLAND STATES BANCORP, INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES (unaudited) (continued) Efficiency Ratio Reconciliation For the Quarter Ended December 31, September 30, June 30, March 31, December 31, (dollars in thousands) 2021 2021 2021 2021 2020 Noninterest expense - GAAP $ 45,757 $ 4
Slide 24: Reconciliations of Non-GAAP Financial Measures: Tangible Common Equity
MIDLAND STATES BANCORP, INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES (unaudited) (continued) Tangible Common Equity to Tangible Assets Ratio and Tangible Book Value Per Share As of December 31, September 30, June 30, March 31, December 31, (dollars in thousands, except per share data) 2021 20
Midland States Bancorp — Q4 2021 Earnings Presentation on 6ix