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Press Release


Midland States Bancorp, Inc. Announces 2025 Second Quarter Results

EFFINGHAM, Ill., July 24, 2025 (GLOBE NEWSWIRE) -- Midland States Bancorp, Inc. (Nasdaq: MSBI) (the “Company”) today reported net income available to common shareholders of $9.8 million, or $0.44 per diluted share, for the second quarter of 2025, compared to net income available to common shareholders of $23.5 million, or $1.06 per diluted share, for the second quarter of 2024.

This also compares to a net loss of $143.2 million, or $6.58 per diluted share, for the first quarter of 2025, which included impairment of goodwill of $154.0 million.

2025 Second Quarter Results

  • Net income available to common shareholders of $9.8 million, or $0.44 per diluted share, for the second quarter of 2025
  • Adjusted earnings of $9.8 million, or $0.44 per diluted share, compared to $10.8 million, or $0.49 per diluted share, in prior quarter
  • Pre-provision net revenue of $32.2 million, or $1.48 per diluted share, for the second quarter of 2025 compared to $27.0 million, or $1.24 per diluted share, for the first quarter of 2025
  • Net interest margin of 3.56%, compared to 3.49% in prior quarter
  • Nonperforming assets to total assets of 1.56%, compared to 2.08% in prior quarter
  • Total capital to risk-weighted assets of 14.50% and common equity tier 1 capital of 9.02%

Discussion of Outlook; President & Chief Executive Officer, Jeffrey G. Ludwig:

“Second quarter marked a notable step in returning Midland to a more normalized operating environment, with progress on several strategic initiatives ranging from growing our community bank to further improving our credit quality. Capital levels increased quarter-over-quarter, and we continue to target growing our common equity tier 1 capital ratio to our target of 10.0%.

During the quarter, we had limited new substandard or nonperforming loans identified, and importantly saw our non-performing assets decrease to $111 million, or 1.56% of total assets, versus $151 million, or 2.08% of total assets in the first quarter. After quarter-end, the bank successfully exited two larger non-performing relationships in July totaling $29 million, which all else equal would bring our non-performing asset ratio down another 41 basis points. Tighter underwriting standards in our equipment finance and specialty finance portfolios have already begun to meaningfully reduce our exposure to these higher-risk portfolios. In addition, we completed the previously announced sale of our GreenSky loans in April further improving our capital and liquidity.

Profitability trends were also favorable in the second quarter, with net interest margin expanding 7 basis points to 3.56%, pre-provision net revenue growing to $32.2 million, and strong contribution from our wealth management platform. We expect further improvement in profitability over the balance of 2025.”

Key Points for Second Quarter and Outlook

Acceleration of Credit Clean-up; Tightened Underwriting Standards

  • Substandard accruing loans and nonperforming loans decreased to $58.5 million and $109.5 million at June 30, 2025, respectively. No significant new substandard or nonperforming loans were identified during the quarter.
  • Net charge-offs were $29.9 million for the quarter, including:
    • $13.9 million of charge-offs in our specialty finance portfolio, of which $10.2 million was specifically reserved for in a prior quarter
    • $4.7 million of fully reimbursed charge-offs related to our third party lending programs
    • $3.9 million of charge-offs in our equipment finance portfolio as we continue to see credit issues primarily in the trucking industry
  • Provision for credit losses on loans was $17.4 million for the second quarter of 2025, primarily as a result of continued trends in the equipment finance portfolio.
  • Allowance for credit losses on loans was $92.7 million, or 1.83% of total loans.

The table below summarizes certain information regarding the Company’s loan portfolio asset quality as of June 30, 2025.

    As of and for the Three Months Ended
(dollars in thousands)
   June 30,   March 31,   December 31,   September 30,   June 30,
    2025       2025       2024       2024       2024  
Asset Quality                    
Loans 30-89 days past due   $ 40,959     $ 48,221     $ 43,681     $ 55,329     $ 54,045  
Nonperforming loans     109,512       145,690       150,907       114,556       112,124  
Nonperforming assets     111,174       151,264       157,409       126,771       123,774  
Substandard accruing loans     58,478       77,620       84,058       167,549       135,555  
Net charge-offs     29,854       16,878       112,776       22,302       13,883  
Loans 30-89 days past due to total loans     0.81 %     0.96 %     0.85 %     0.97 %     0.93 %
Nonperforming loans to total loans     2.16 %     2.90 %     2.92 %     2.00 %     1.92 %
Nonperforming assets to total assets     1.56 %     2.08 %     2.10 %     1.65 %     1.61 %
Allowance for credit losses to total loans     1.83 %     2.10 %     2.15 %     2.64 %     2.67 %
Allowance for credit losses to nonperforming loans     84.64 %     72.19 %     73.69 %     131.87 %     138.63 %
Net charge-offs to average loans     2.34 %     1.35 %     7.94 %     1.53 %     0.94 %
                                         

Solid Growth Trends in Community Bank & Wealth Management 

  • Total loans at June 30, 2025 were $5.06 billion, an increase of $46.6 million from March 31, 2025. Key changes in the loan portfolio were as follows:
    • Loans originated by our Community Bank increased $58.9 million, or 1.8%, from March 31, 2025. Pipelines remain strong and we continued to add to our sales teams in the second quarter.
    • Non-core loans originated through third-party programs increased $212.8 million from March 31, 2025, as a result of the financing of the sale of the GreenSky portfolio.
    • We continue to pursue an intentional decrease in our Specialty Finance loan portfolio, as we tighten credit standards. Balances in this loan portfolio decreased $173.3 million during the quarter.
    • Equipment finance portfolio balances declined $51.8 million during the quarter as we continue to reduce the overall balances in this unit and tighten underwriting standards.
  • Total deposits were $5.95 billion at June 30, 2025, an increase of $10.5 million from March 31, 2025. The increase in deposits reflects the following:
    • Commercial and public fund deposits increased $70.5 million and $127.8 million, respectively, in the quarter.
    • Noninterest-bearing deposits decreased $16.5 million in the quarter.
    • Retail and servicing deposits decreased $34.7 million and $56.9 million, respectively, in the quarter.
    • Brokered deposits, including both money market and time deposits, decreased by $109.4 million.
    • Servicing deposits decreased $284.4 million in July 2025 due to the acquisition of one of our servicing customers, expected to positively impact future margin.
  • Wealth Management revenue totaled $7.4 million in the second quarter of 2025. Assets under administration were $4.18 billion at June 30, 2025. The Company added three new sales positions in the second quarter of 2025 and continues to experience strong pipelines.

Net Interest Margin

  • Net interest margin was 3.56%, up 7 basis points compared to the first quarter, and we saw a continued decline in the cost of funding. Rate cuts enacted by the Federal Reserve Bank in late 2024 continue to result in a lower cost of deposits for the Company, which fell to 2.19% in the second quarter of 2025.

The following table summarizes certain factors affecting the Company’s net interest margin for the second quarter of 2025.

    For the Three Months Ended
(dollars in thousands)   June 30, 2025   March 31, 2025   June 30, 2024
Interest-earning assets   Average
Balance		   Interest &
Fees		   Yield/
Rate		   Average
Balance		   Interest &
Fees		   Yield/
Rate		   Average
Balance		   Interest &
Fees		   Yield/
Rate
Cash and cash equivalents   $ 67,326   $ 716   4.27 %   $ 68,671   $ 718   4.24 %   $ 65,250   $ 875   5.40 %
Investment securities(1)     1,367,180     17,164   5.04       1,311,887     15,517   4.80       1,098,452     12,805   4.69  
Loans(1)(2)     5,123,558     79,240   6.20       5,057,394     78,118   6.26       5,915,523     92,581   6.29  
Loans held for sale     44,642     377   3.39       326,348     4,563   5.67       4,910     84   6.84  
Nonmarketable equity securities     38,803     694   7.17       35,614     647   7.37       44,216     963   8.76  
Total interest-earning assets     6,641,509     98,191   5.93       6,799,914     99,563   5.94       7,128,351     107,308   6.05  
Noninterest-earning assets     513,801             667,940             669,370        
Total assets   $ 7,155,310           $ 7,467,854           $ 7,797,721        
                                     
Interest-Bearing Liabilities                                    
Interest-bearing deposits   $ 4,845,609   $ 32,290   2.67 %   $ 5,074,007   $ 34,615   2.77 %   $ 5,101,365   $ 39,476   3.11 %
Short-term borrowings     60,117     573   3.82       73,767     700   3.85       30,449     308   4.07  
FHLB advances & other borrowings     363,505     3,766   4.16       299,578     3,163   4.28       500,758     5,836   4.69  
Subordinated debt     77,757     1,394   7.19       77,752     1,387   7.23       93,090     1,265   5.47  
Trust preferred debentures     51,439     1,206   9.40       51,283     1,200   9.49       50,921     1,358   10.73  
Total interest-bearing liabilities     5,398,427     39,229   2.91       5,576,387     41,065   2.99       5,776,583     48,243   3.36  
Noninterest-bearing deposits     1,075,945             1,052,181             1,132,451        
Other noninterest-bearing liabilities     108,819             123,613             104,841        
Shareholders’ equity     572,119             715,673             783,846        
Total liabilities and shareholder’s equity   $ 7,155,310           $ 7,467,854           $ 7,797,721        
                                     
Net Interest Margin       $ 58,962   3.56 %       $ 58,498   3.49 %       $ 59,065   3.33 %
                                     
Cost of Deposits           2.19 %           2.29 %           2.55 %

(1) Interest income and average rates for tax-exempt loans and investment securities are presented on a tax-equivalent basis, assuming a federal income tax rate of 21%. Tax-equivalent adjustments totaled $0.3 million, $0.2 million and $0.2 million for the three months ended June 30, 2025, March 31, 2025 and June 30, 2024, respectively.

(2) Average loan balances include nonaccrual loans. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs.


Trends in Noninterest Income and Expense

  • Noninterest income was $23.5 million for the second quarter of 2025, compared to $17.8 million for the first quarter of 2025. Noninterest income for the second quarter of 2025 included credit enhancement income of $3.8 million, primarily related to an increase in charge-offs in our third-party loan origination and servicing program which were fully reimbursed by our program sponsor.
  • Noninterest expense was $50.0 million for the second quarter of 2025, compared to $203.0 million for the first quarter of 2025, which included goodwill impairment of $154.0 million. The Company continues to experience higher levels of professional services, legal fees and other expenses related to loan collections and the restatement of our financial statements.

Second Quarter 2025 Financial Highlights and Key Performance Indicators (KPIs):

    As of and for the Three Months Ended
    June 30,   March 31,   December 31,   September 30,   June 30,
      2025       2025       2024       2024       2024  
Return on average assets     0.67 %     (7.66 )%     (1.59 )%     1.05 %     1.33 %
Pre-provision net revenue to average assets(1)     1.81 %     1.47 %     1.83 %     2.21 %     2.07 %
Net interest margin     3.56 %     3.49 %     3.34 %     3.34 %     3.33 %
Efficiency ratio (1)     60.60 %     64.29 %     62.31 %     53.61 %     55.79 %
Noninterest expense to average assets     2.80 %     11.02 %     3.04 %     2.56 %     2.62 %
Net charge-offs to average loans     2.34 %     1.35 %     7.94 %     1.53 %     0.94 %
Tangible book value per share at period end (1)   $ 20.68     $ 20.54     $ 19.83     $ 22.70     $ 21.07  
Diluted earnings (loss) per common share   $ 0.44     $ (6.58 )   $ (1.52 )   $ 0.83     $ 1.06  
Common shares outstanding at period end     21,515,138       21,503,036       21,494,485       21,393,905       21,377,215  
Trust assets under administration   $ 4,181,180     $ 4,101,414     $ 4,153,080     $ 4,268,539     $ 3,996,175  

(1) Non-GAAP financial measures. Refer to page 10 for a reconciliation to the comparable GAAP financial measures.


Capital

At June 30, 2025, Midland States Bank and the Company exceeded all regulatory capital requirements under Basel III, and Midland States Bank met the qualifications to be a ‘‘well-capitalized’’ financial institution, as summarized in the following table:

  As of June 30, 2025
  Midland States Bank   Midland States
Bancorp, Inc.		   Minimum Regulatory
Requirements (2)
Total capital to risk-weighted assets 13.74%   14.50%   10.50%
Tier 1 capital to risk-weighted assets 12.49%   12.07%   8.50%
Common equity Tier 1 capital to risk-weighted assets 12.49%   9.02%   7.00%
Tier 1 leverage ratio 9.93%   9.59%   4.00%
Tangible common equity to tangible assets (1) N/A   6.27%   N/A

(1) A non-GAAP financial measure. Refer to page 10 for a reconciliation to the comparable GAAP financial measure.
(2) Includes the capital conservation buffer of 2.5%, as applicable.


About Midland States Bancorp, Inc.

Midland States Bancorp, Inc. is a community-based financial holding company headquartered in Effingham, Illinois, and is the sole shareholder of Midland States Bank. As of June 30, 2025, the Company had total assets of approximately $7.11 billion, and its Wealth Management Group had assets under administration of approximately $4.18 billion. The Company provides a full range of commercial and consumer banking products and services and business equipment financing, merchant credit card services, trust and investment management, insurance and financial planning services. For additional information, visit https://www.midlandsb.com/ or https://www.linkedin.com/company/midland-states-bank.

Non-GAAP Financial Measures

Some of the financial measures included in this press release are not measures of financial performance recognized in accordance with GAAP.

These non-GAAP financial measures include “Pre-provision net revenue,” “Pre-provision net revenue per diluted share,” “Pre-provision net revenue to average assets,” “Efficiency ratio,” “Tangible common equity to tangible assets,” and “Tangible book value per share.” The Company believes these non-GAAP financial measures provide both management and investors a more complete understanding of the Company’s funding profile and profitability. These non-GAAP financial measures are supplemental and are not a substitute for any analysis based on GAAP financial measures. Not all companies use the same calculation of these measures; therefore, the measures in this press release may not be comparable to other similarly titled measures as presented by other companies.

Forward-Looking Statements

Readers should note that in addition to the historical information contained herein, this press release includes "forward-looking statements" within the meanings of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including but not limited to statements about the Company’s plans, objectives, future performance, goals and future earnings levels, including currently anticipated levels of noninterest income and operating expenses. These statements are subject to many risks and uncertainties, including changes in interest rates and other general economic, business and political conditions; the impact of federal trade policy, inflation, increased deposit volatility and potential regulatory developments; changes in the financial markets; changes in business plans as circumstances warrant; changes to U.S. tax laws, regulations and guidance; and other risks detailed from time to time in filings made by the Company with the Securities and Exchange Commission. Readers should note that the forward-looking statements included in this press release are not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking statements. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "will," "propose," "may," "plan," "seek," "expect," "intend," "estimate," "anticipate," "believe," "continue," or similar terminology. Any forward-looking statements presented herein are made only as of the date of this press release, and the Company does not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

CONTACTS:
Jeffrey G. Ludwig, President and CEO, at jludwig@midlandsb.com or (217) 342-7321
Eric T. Lemke, Chief Financial Officer, at elemke@midlandsb.com or (217) 342-7321

 
MIDLAND STATES BANCORP, INC.
CONSOLIDATED FINANCIAL SUMMARY (unaudited)
                     
    As of
    June 30,   March 31,   December 31,   September 30,   June 30,
(dollars in thousands)     2025       2025       2024       2024       2024  
Assets                    
Cash and cash equivalents   $ 176,587     $ 102,006     $ 114,766     $ 121,873     $ 124,646  
Investment securities     1,354,652       1,368,405       1,212,366       1,216,795       1,099,654  
Loans     5,064,695       5,018,053       5,167,574       5,728,237       5,829,057  
Allowance for credit losses on loans     (92,690 )     (105,176 )     (111,204 )     (151,067 )     (155,443 )
Total loans, net     4,972,005       4,912,877       5,056,370       5,577,170       5,673,614  
Loans held for sale     7,899       287,821       344,947       8,001       5,555  
Premises and equipment, net     86,240       86,719       85,710       84,672       83,040  
Other real estate owned     393       4,183       4,941       8,646       8,304  
Loan servicing rights, at lower of cost or fair value     16,720       17,278       17,842       18,400       18,902  
Goodwill     7,927       7,927       161,904       161,904       161,904  
Other intangible assets, net     10,362       11,189       12,100       13,052       14,003  
Company-owned life insurance     214,392       212,336       211,168       209,193       207,211  
Credit enhancement asset     5,800       5,615       16,804       20,633       18,202  
Other assets     254,901       268,448       267,891       263,850       293,039  
Total assets   $ 7,107,878     $ 7,284,804     $ 7,506,809     $ 7,704,189     $ 7,708,074  
                     
Liabilities and Shareholders' Equity                    
Noninterest-bearing demand deposits   $ 1,074,212     $ 1,090,707     $ 1,055,564     $ 1,050,617     $ 1,108,521  
Interest-bearing deposits     4,872,707       4,845,727       5,141,679       5,206,219       5,009,502  
Total deposits     5,946,919       5,936,434       6,197,243       6,256,836       6,118,023  
Short-term borrowings     8,654       40,224       87,499       13,849       7,208  
FHLB advances and other borrowings     345,000       498,000       258,000       425,000       600,000  
Subordinated debt     77,759       77,754       77,749       82,744       91,656  
Trust preferred debentures     51,518       51,358       51,205       51,058       50,921  
Other liabilities     104,323       109,597       124,266       103,481       103,487  
Total liabilities     6,534,173       6,713,367       6,795,962       6,932,968       6,971,295  
Total shareholders’ equity     573,705       571,437       710,847       771,221       736,779  
Total liabilities and shareholders’ equity   $ 7,107,878     $ 7,284,804     $ 7,506,809     $ 7,704,189     $ 7,708,074  


MIDLAND STATES BANCORP, INC.
CONSOLIDATED FINANCIAL SUMMARY (unaudited) (continued)
                     
    For the Three Months Ended
    June 30,   March 31,   December 31,   September 30,   June 30,
(dollars in thousands, except per share data)    2025     2025       2024       2024       2024  
Net interest income:                    
Interest income   $ 97,924   $ 99,355     $ 104,470     $ 108,994     $ 107,138  
Interest expense     39,229     41,065       45,900       49,884       48,243  
Net interest income     58,695     58,290       58,570       59,110       58,895  
Provision for credit losses:                    
Provision for credit losses on loans     17,369     10,850       74,183       17,925       8,482  
Recapture of credit losses on unfunded commitments     —     —       —       —       (200 )
Total provision for credit losses     17,369     10,850       74,183       17,925       8,282  
Net interest income after provision for credit losses     41,326     47,440       (15,613 )     41,185       50,613  
Noninterest income:                    
Wealth management revenue     7,379     7,350       7,660       7,104       6,801  
Service charges on deposit accounts     3,351     3,305       3,506       3,411       3,121  
Interchange revenue     3,463     3,151       3,528       3,506       3,563  
Residential mortgage banking revenue     756     676       637       697       557  
Income on company-owned life insurance     2,068     2,334       1,975       1,981       1,925  
Loss on sales of investment securities, net     —     —       (34 )     (44 )     (152 )
Credit enhancement income (loss)     3,848     (578 )     15,810       14,206       14,328  
Other income     2,669     1,525       2,289       2,684       1,841  
Total noninterest income     23,534     17,763       35,371       33,545       31,984  
Noninterest expense:                    
Salaries and employee benefits     25,685     26,416       22,283       24,382       22,872  
Occupancy and equipment     4,166     4,498       4,286       4,393       3,964  
Data processing     7,035     6,919       7,278       6,955       7,205  
Professional services     2,792     2,741       1,580       1,744       2,243  
Impairment on goodwill     —     153,977       —       —       —  
Amortization of intangible assets     827     911       952       951       1,016  
Impairment on leased assets and surrendered assets     —     —       7,601       —       —  
FDIC insurance     1,422     1,463       1,383       1,402       1,219  
Other expense     8,065     6,080       13,336       9,937       12,265  
Total noninterest expense     49,992     203,005       58,699       49,764       50,784  
Income (loss) before income taxes     14,868     (137,802 )     (38,941 )     24,966       31,813  
Income tax expense (benefit)     2,844     3,172       (8,172 )     4,535       6,094  
Net income (loss)     12,024     (140,974 )     (30,769 )     20,431       25,719  
Preferred stock dividends     2,228     2,228       2,228       2,229       2,228  
Net income (loss) available to common shareholders   $ 9,796   $ (143,202 )   $ (32,997 )   $ 18,202     $ 23,491  
                     
Basic earnings (loss) per common share   $ 0.44   $ (6.58 )   $ (1.52 )   $ 0.83     $ 1.06  
Diluted earnings (loss) per common share   $ 0.44   $ (6.58 )   $ (1.52 )   $ 0.83     $ 1.06  
Weighted average common shares outstanding     21,820,190     21,795,570       21,748,428       21,675,818       21,731,195  
Weighted average diluted common shares outstanding     21,820,190     21,795,570       21,753,711       21,678,242       21,734,849  


MIDLAND STATES BANCORP, INC.
CONSOLIDATED FINANCIAL SUMMARY (unaudited)(continued)
                     
    As of
    June 30,   March 31,   December 31,   September 30,   June 30,
(dollars in thousands)    2025    2025    2024    2024    2024
Loan Portfolio Mix                    
Commercial loans   $ 1,178,792   $ 879,286   $ 934,847   $ 879,590   $ 955,667
Equipment finance loans     364,526     390,276     416,970     442,552     461,409
Equipment finance leases     347,155     373,168     391,390     417,531     428,659
Commercial FHA warehouse lines     1,068     —     8,004     50,198     —
Total commercial loans and leases     1,891,541     1,642,730     1,751,211     1,789,871     1,845,735
Commercial real estate     2,412,761     2,592,325     2,591,664     2,510,472     2,421,505
Construction and land development     258,729     264,966     299,842     422,253     476,528
Residential real estate     361,261     373,095     380,557     378,658     378,393
Consumer     140,403     144,937     144,300     626,983     706,896
Total loans   $ 5,064,695   $ 5,018,053   $ 5,167,574   $ 5,728,237   $ 5,829,057
                     
Loan Portfolio Segment                    
Regions                    
Eastern   $ 901,848   $ 897,792   $ 899,611   $ 902,993   $ 884,343
Northern     753,590     747,028     714,562     730,752     724,782
Southern     778,124     711,787     720,188     694,810     699,893
St. Louis     884,685     902,743     868,190     850,327     825,291
Total Community Bank     3,318,247     3,259,350     3,202,551     3,178,882     3,134,309
Specialty finance     701,244     874,567     1,038,238     1,018,961     1,107,508
Equipment finance     711,681     763,444     808,359     860,083     890,068
Non-core loan program and other(1)     333,523     120,692     118,426     670,311     697,172
Total loans   $ 5,064,695   $ 5,018,053   $ 5,167,574   $ 5,728,237   $ 5,829,057
                     
Deposit Portfolio Mix                    
Noninterest-bearing demand   $ 1,074,212   $ 1,090,707   $ 1,055,564   $ 1,050,617   $ 1,108,521
Interest-bearing:                    
Checking     2,180,717     2,161,282     2,378,256     2,389,970     2,343,533
Money market     1,216,357     1,154,403     1,173,630     1,187,139     1,143,668
Savings     511,470     522,663     507,305     510,260     538,462
Time     818,813     818,732     822,981     849,413     852,415
Brokered time     145,350     188,647     259,507     269,437     131,424
Total deposits   $ 5,946,919   $ 5,936,434   $ 6,197,243   $ 6,256,836   $ 6,118,023
                     
Deposit Portfolio by Channel                    
Retail   $ 2,811,838   $ 2,846,494   $ 2,749,650   $ 2,695,077   $ 2,742,494
Commercial     1,145,369     1,074,837     1,209,815     1,218,657     1,217,068
Public Funds     618,172     490,374     505,912     574,704     568,889
Wealth & Trust     304,626     301,251     340,615     332,242     298,659
Servicing     785,659     842,567     896,436     958,662     931,892
Brokered Deposits     248,707     358,063     473,451     390,558     238,708
Other     32,548     22,848     21,364     86,936     120,313
Total deposits   $ 5,946,919   $ 5,936,434   $ 6,197,243   $ 6,256,836   $ 6,118,023

(1) Non-core loan programs refer to loan portfolios originated through third parties or capital markets, including loans to finance the sale of the GreenSky portfolio.

 
MIDLAND STATES BANCORP, INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES (unaudited)
                     
Adjusted Earnings Reconciliation
                     
    For the Three Months Ended
    June 30,   March 31,   December 31,   September 30,   June 30,
(dollars in thousands, expect per share data)     2025       2025       2024       2024       2024  
Income (loss) before income tax (benefit) expense - GAAP   $ 14,868     $ (137,802 )   $ (38,941 )   $ 24,966     $ 31,813  
Adjustments to noninterest income:                    
Loss on sales of investment securities, net     —       —       34       44       152  
Loss (gain) on repurchase of subordinated debt     —       —       13       (77 )     (167 )
Total adjustments to noninterest income     —       —       47       (33 )     (15 )
Adjustments to noninterest expense:                    
Impairment on goodwill     —       (153,977 )     —       —       —  
Total adjustments to noninterest expense     —       (153,977 )     —       —       —  
Adjusted earnings (loss) pre tax - non-GAAP     14,868       16,175       (38,894 )     24,933       31,798  
Adjusted earnings (loss) tax (benefit) expense     2,844       3,172       (8,159 )     4,526       6,090  
Adjusted earnings (loss) - non-GAAP     12,024       13,003       (30,735 )     20,407       25,708  
Preferred stock dividends     2,228       2,228       2,228       2,229       2,228  
Adjusted earnings (loss) available to common shareholders   $ 9,796     $ 10,775     $ (32,963 )   $ 18,178     $ 23,480  
Adjusted diluted earnings (loss) per common share   $ 0.44     $ 0.49     $ (1.52 )   $ 0.82     $ 1.06  
                     
Pre-Provision Net Revenue Reconciliation
                     
    For the Three Months Ended
    June 30,   March 31,   December 31,   September 30,   June 30,
(dollars in thousands)     2025       2025       2024       2024       2024  
Income (loss) before income taxes   $ 14,868     $ (137,802 )   $ (38,941 )   $ 24,966     $ 31,813  
Provision for credit losses     17,369       10,850       74,183       17,925       8,282  
Impairment on goodwill     —       153,977       —       —       —  
Pre-provision net revenue   $ 32,237     $ 27,025     $ 35,242     $ 42,891     $ 40,095  
Pre-provision net revenue per diluted share   $ 1.48     $ 1.24     $ 1.62     $ 1.98     $ 1.84  
Pre-provision net revenue to average assets     1.81 %     1.47 %     1.83 %     2.21 %     2.07 %


MIDLAND STATES BANCORP, INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES (unaudited)
                     
Efficiency Ratio Reconciliation
                     
    For the Three Months Ended
    June 30,   March 31,   December 31,   September 30,   June 30,
(dollars in thousands)     2025       2025       2024       2024       2024  
Noninterest expense - GAAP   $ 49,992     $ 203,005     $ 58,699     $ 49,764     $ 50,784  
Impairment on goodwill     —       (153,977 )     —       —       —  
Adjusted noninterest expense   $ 49,992     $ 49,028     $ 58,699     $ 49,764     $ 50,784  
                     
Net interest income - GAAP   $ 58,695     $ 58,290     $ 58,570     $ 59,110     $ 58,895  
Effect of tax-exempt income     267       208       220       205       170  
Adjusted net interest income     58,962       58,498       58,790       59,315       59,065  
                     
Noninterest income - GAAP     23,534       17,763       35,371       33,545       31,984  
Loss on sales of investment securities, net     —       —       34       44       152  
Loss (gain) on repurchase of subordinated debt     —       —       13       (77 )     (167 )
Adjusted noninterest income     23,534       17,763       35,418       33,512       31,969  
                     
Adjusted total revenue   $ 82,496     $ 76,261     $ 94,208     $ 92,827     $ 91,034  
                     
Efficiency ratio     60.60 %     64.29 %     62.31 %     53.61 %     55.79 %


Tangible Common Equity to Tangible Assets Ratio and Tangible Book Value Per Share
                     
    As of
    June 30,   March 31,   December 31,   September 30,   June 30,
(dollars in thousands, except per share data)     2025       2025       2024       2024       2024  
Shareholders' Equity to Tangible Common Equity                        
Total shareholders' equity—GAAP   $ 573,705     $ 571,437     $ 710,847     $ 771,221     $ 736,779  
Adjustments:                    
Preferred Stock     (110,548 )     (110,548 )     (110,548 )     (110,548 )     (110,548 )
Goodwill     (7,927 )     (7,927 )     (161,904 )     (161,904 )     (161,904 )
Other intangible assets, net     (10,362 )     (11,189 )     (12,100 )     (13,052 )     (14,003 )
Tangible common equity     444,868       441,773       426,295       485,717       450,324  
                     
Total Assets to Tangible Assets:                    
Total assets—GAAP   $ 7,107,878     $ 7,284,804     $ 7,506,809     $ 7,704,189     $ 7,708,074  
Adjustments:                    
Goodwill     (7,927 )     (7,927 )     (161,904 )     (161,904 )     (161,904 )
Other intangible assets, net     (10,362 )     (11,189 )     (12,100 )     (13,052 )     (14,003 )
Tangible assets   $ 7,089,589     $ 7,265,688     $ 7,332,805     $ 7,529,233     $ 7,532,167  
                     
Common Shares Outstanding     21,515,138       21,503,036       21,494,485       21,393,905       21,377,215  
                     
Tangible Common Equity to Tangible Assets     6.27 %     6.08 %     5.81 %     6.45 %     5.98 %
Tangible Book Value Per Share   $ 20.68     $ 20.54     $ 19.83     $ 22.70     $ 21.07  

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Source: Midland States Bancorp, Inc.

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