MidWestOne Financial Group, Inc. Reports Financial Results for the Third Quarter of 2024
IOWA CITY, Iowa, Oct. 24, 2024 (GLOBE NEWSWIRE) -- MidWestOne Financial Group, Inc. (NASDAQ:MOFG) ("we", "our", or the "Company") today reported results for the third quarter of 2024.
Third Quarter 2024 Summary1
Completed a common equity capital raise, resulting in net proceeds to the Company of $118.6 million to facilitate a balance sheet repositioning. $140.4 million of securities impairment related to the repositioning was recognized in pre-tax earnings.
Subsequent to quarter-end:
Sold $1.0 billion of debt securities with a weighted average yield of 1.58%, and a weighted average life of 5.6 years.
Purchased $589.8 million of debt securities, with a weighted average yield of 4.65%, and paid in full $418.7 million of Bank Term Funding Program borrowings with a weighted average cost of 4.77%.
The estimated earn back period for the securities losses is 4.5 years.
Recognized a net loss for the quarter of $95.7 million, or $(6.05) per diluted common share, reflecting the effects of the capital raise and balance sheet repositioning. Adjusted earnings were $9.1 million2, or $0.582 per diluted common share, which included a $1.2 million fraud loss related to a single incident.
Net interest margin (tax equivalent) expanded 10 basis points ("bps") to 2.51%.2
Annualized loan growth of 3.9%.
Noninterest bearing deposits increased 4.0% from the linked quarter.
Nonperforming assets ratio improved 8 bps to 0.39%; classified loans declined $14.5 million to $134.8 million; net charge-off ratio was 0.16%.
CEO Commentary
Charles (Chip) Reeves, Chief Executive Officer of the Company, commented, "Our successful common equity capital raise and balance sheet repositioning are significant, transformational steps towards our goal of creating a high performing company. We were pleased with the market receptivity of the oversubscribed common equity offering and the balance sheet repositioning financial results exceeded our communicated expectations. We are appreciative of our existing and new shareholders who supported this transformation and our team who executed the strategy so well."
Mr. Reeves continued, "We also kept our eye on the ball during the quarter, delivering positive results in a number of strategic initiatives. Our deposit franchise continues to show its strength as deposit costs rose minimally and our treasury management investments led to 4% linked quarter non-interest bearing deposit growth. Our commercial banking teams drove 4% annualized loan growth, improved asset quality, and good progress in our SBA lending and gain on sale initiatives. In addition, we continued to invest in our franchise, with both talent and technology, while maintaining expense discipline."
_________________________1Third Quarter Summary compares to the second quarter of 2024 (the "linked quarter") unless noted. 2Non-GAAP measure. See the separate Non-GAAP Measures section for a reconciliation to the most directly comparable GAAP measure.
As of or for the quarter ended
Nine Months Ended
(Dollars in thousands, except per share amounts and as noted)
September 30,
June 30,
September 30,
September 30,
September 30,
2024
2024
2023
2024
2023
Financial Results
Revenue
$
(92,867
)
$
57,901
$
44,436
$
9,515
$
126,174
Credit loss expense
1,535
1,267
1,551
7,491
4,081
Noninterest expense
35,798
35,761
31,544
107,124
99,782
Net (loss) income
(95,707
)
15,819
9,138
(76,619
)
18,129
Adjusted earnings(1)
9,141
8,132
8,875
21,762
28,046
Per Common Share
Diluted (loss) earnings per share
$
(6.05
)
$
1.00
$
0.58
$
(4.86
)
$
1.15
Adjusted earnings per share(1)
0.58
0.52
0.56
1.38
1.79
Book value
27.06
34.44
32.21
27.06
32.21
Tangible book value(1)
22.43
28.27
26.60
22.43
26.60
Balance Sheet & Credit Quality
Loans In millions
$
4,328.8
$
4,287.2
$
4,066.0
$
4,328.8
$
4,066.0
Investment securities In millions
1,623.1
1,824.1
1,958.5
1,623.1
1,958.5
Deposits In millions
5,368.7
5,412.4
5,363.3
5,368.7
5,363.3
Net loan charge-offs In millions
1.7
0.5
0.5
2.4
1.7
Allowance for credit losses ratio
1.25
%
1.26
%
1.27
%
1.25
%
1.27
%
Selected Ratios
Return on average assets
(5.78
)%
0.95
%
0.56
%
(1.54
)%
0.37
%
Net interest margin, tax equivalent(1)
2.51
%
2.41
%
2.35
%
2.42
%
2.54
%
Return on average equity
(69.05
)%
11.91
%
7.14
%
(19.03
)%
4.81
%
Return on average tangible equity(1)
(82.78
)%
15.74
%
9.68
%
(22.17
)%
7.03
%
Efficiency ratio(1)
70.32
%
56.29
%
66.06
%
65.20
%
66.40
%
(1) Non-GAAP measure. See the Non-GAAP Measures section for a reconciliation to the most directly comparable GAAP measure.
REVENUE REVIEW
Revenue
Change
Change
3Q24 vs
3Q24 vs
(Dollars in thousands)
3Q24
2Q24
3Q23
2Q24
3Q23
Net interest income
$
37,521
$
36,347
$
34,575
3
%
9
%
Noninterest (loss) income
(130,388
)
21,554
9,861
n/m
n/m
Total revenue, net of interest expense
$
(92,867
)
$
57,901
$
44,436
n/m
n/m
(n/m) - Not meaningful
Total revenue for the third quarter of 2024 decreased $150.8 million from the second quarter of 2024 and decreased $137.3 million compared to the third quarter of 2023, due to lower noninterest income, partially offset by higher net interest income. Excluding the pre-tax securities loss of $140.4 million stemming from the balance sheet repositioning, total revenue for the third quarter was $47.5 million, a decline of $10.4 million from the second quarter of 2024 and an increase of $3.1 million from the third quarter of 2023.
Net interest income of $37.5 million for the third quarter of 2024 increased $1.2 million from the second quarter of 2024, due to higher earning asset yields and lower funding volumes, partially offset by lower earning asset volumes and higher funding costs. When compared to the third quarter of 2023, net interest income increased $2.9 million, due to higher earning asset volumes and yields, partially offset by higher funding costs and volumes. We expect net interest income to be higher going forward as a result of the balance sheet repositioning.
The Company's tax equivalent net interest margin was 2.51%3 in the third quarter of 2024, compared to 2.41%3 in the second quarter of 2024, as higher earning asset yields more than offset increased funding costs. Total earning assets yield during the third quarter of 2024 increased 10 bps from the second quarter of 2024 due primarily to an increase in loan yields of 17 bps. Funding costs during the third quarter of 2024 increased 2 bps to 2.87%, due primarily to the 4 bps increase in interest bearing deposit costs to 2.58%, which was partially offset by a reduction in short-term borrowing costs and long-term debt of 10 bps and 4 bps, to 4.76% and 6.91%, respectively from the second quarter of 2024.
The Company's tax equivalent net interest margin was 2.51%3 in the third quarter of 2024, compared to 2.35%3 in the third quarter of 2023, driven by higher earning asset volumes and yields, partially offset by higher funding costs and volumes. Total earning assets yield increased 58 bps from the third quarter of 2023, primarily from a 67 bps increase in loan yields. Funding costs increased 54 bps to 2.87%, due to interest bearing deposit costs of 2.58%, short-term borrowing costs of 4.76%, and long-term debt costs of 6.91%, which increased 53 bps, 47 bps and 13 bps, respectively from the third quarter of 2023.
_________________________3 Non-GAAP measure. See the separate Non-GAAP Measures section for a reconciliation to the most directly comparable GAAP measure.
Noninterest (Loss) Income
Change
Change
3Q24 vs
3Q24 vs
(In thousands)
3Q24
2Q24
3Q23
2Q24
3Q23
Investment services and trust activities
$
3,410
$
3,504
$
3,004
(3
)%
14
%
Service charges and fees
2,170
2,156
2,146
1
%
1
%
Card revenue
1,935
1,907
1,817
1
%
6
%
Loan revenue
760
1,525
1,462
(50
)%
(48
)%
Bank-owned life insurance
879
668
626
32
%
40
%
Investment securities (losses) gains, net
(140,182
)
33
79
n/m
n/m
Other
640
11,761
727
(95
)%
(12
)%
Total noninterest (loss) income
$
(130,388
)
$
21,554
$
9,861
n/m
n/m
MSR adjustment (included above in Loan revenue)
$
(1,026
)
$
129
$
283
n/m
n/m
Gain on branch sale (included above in Other)
—
11,056
—
n/m
n/m
(n/m) - Not meaningful
Noninterest income for the third quarter of 2024 decreased $151.9 million from the linked quarter, due primarily to the securities impairment of $140.4 million related to the Company's balance sheet repositioning and a decrease of $11.1 million in other revenue. The decrease in other revenue reflected the $11.1 million gain from the sale of our Florida banking operations in the second quarter of 2024 that did not recur in the third quarter of 2024. In addition, loan revenue decreased $765 thousand due to a $1.2 million unfavorable change in the value of our mortgage servicing rights, partially offset by an increase of $0.4 million in SBA gain on sale revenue.
Noninterest income for the third quarter of 2024 decreased $140.2 million from the third quarter of 2023, due primarily to the balance sheet repositioning-related securities impairment previously noted. Also contributing to the decline in noninterest income was a decrease in loan revenue stemming from the unfavorable year-over-year change in the fair value of our mortgage servicing rights, which was partially offset by an increase of $0.5 million in SBA gain on sale. Partially offsetting these decreases in noninterest income was an increase of $0.4 million in investment services and trust activities revenue, driven by growth in assets under administration and transaction fees, and an increase of $0.3 million in bank-owned life insurance due primarily to $0.2 million of death benefits recognized in the third quarter of 2024.
EXPENSE REVIEW
Noninterest Expense
Change
Change
3Q24 vs
3Q24 vs
(In thousands)
3Q24
2Q24
3Q23
2Q24
3Q23
Compensation and employee benefits
$
19,943
$
20,985
$
18,558
(5
)%
7
%
Occupancy expense of premises, net
2,443
2,435
2,405
—
%
2
%
Equipment
2,486
2,530
2,123
(2
)%
17
%
Legal and professional
2,261
2,253
1,678
—
%
35
%
Data processing
1,580
1,645
1,504
(4
)%
5
%
Marketing
619
636
782
(3
)%
(21
)%
Amortization of intangibles
1,470
1,593
1,460
(8
)%
1
%
FDIC insurance
923
1,051
783
(12
)%
18
%
Communications
159
191
206
(17
)%
(23
)%
Foreclosed assets, net
330
138
2
139
%
n/m
Other
3,584
2,304
2,043
56
%
75
%
Total noninterest expense
$
35,798
$
35,761
$
31,544
—
%
13
%
(n/m) - Not meaningful
Merger-related Expenses
(In thousands)
3Q24
2Q24
3Q23
Compensation and employee benefits
$
—
$
73
$
—
Occupancy expense of premises, net
—
—
—
Equipment
—
28
—
Legal and professional
127
462
11
Data processing
—
251
—
Marketing
—
—
—
Communications
—
8
—
Other
6
32
—
Total merger-related expenses
$
133
$
854
$
11
Noninterest expense for the third quarter of 2024 compared to the linked quarter was stable at $35.8 million, with increases of $1.3 million and $0.2 million in other expense and foreclosed assets, net, respectively. The increase in other expense was primarily driven by a $1.2 million fraud loss related to a single instance recorded in the third quarter of 2024, while the increase in foreclosed assets, net, expense was attributable to a $0.3 million write-down and higher operating expenses of one other real estate owned relationship, partially offset by a $0.4 million gain on sale of a separate other real estate owned relationship. Partially offsetting these increases in noninterest expense were declines in all other noninterest expense categories, with the largest decrease in compensation and employee benefits, which stemmed from the sale of our Florida banking operations in the second quarter of 2024. Further decreases in noninterest expense categories were also driven by a $0.7 million decline in merger-related expenses.
Noninterest expense for the third quarter of 2024 increased $4.3 million from the third quarter of 2023 primarily due to increases in all noninterest expense categories, except marketing and communications. The largest contributors to the increase in noninterest expense were increases of $1.5 million, $1.4 million, and $0.6 million in other, compensation and employee benefits, and legal and professional expense, respectively. The increase in other expense was primarily driven by a $1.2 million fraud loss recorded in the third quarter of 2024. The increase in compensation and employee benefits expense was driven by annual compensation adjustments and increased incentive and commission expense. The increase in legal and professional expense stemmed from increased costs for legal fees, consulting, personnel procurement, merger-related expenses, and accounting and tax fees. Partially offsetting these increases was a decline of $0.2 million in marketing expense.
The Company's effective tax rate was 26.5% in the third quarter of 2024, compared to 24.2% in the linked quarter. The increase in the effective tax rate reflected the impact of the investment security impairments recorded in the third quarter of 2024 related to the balance sheet repositioning. The effective income tax rate for the fourth quarter of 2024 and full year 2025 is expected to be 22-23%.
BALANCE SHEET REVIEW
Total assets were $6.55 billion at September 30, 2024, compared to $6.58 billion at June 30, 2024 and $6.47 billion at September 30, 2023. The decrease from June 30, 2024 was primarily driven by lower securities balances stemming from impairment recognized in the third quarter of 2024 related to the balance sheet repositioning, fair value adjustments recognized in connection with the re-classification of securities from held-to-maturity to available-for-sale, and scheduled calls, maturities, and paydowns, partially offset by higher cash and loan balances. Compared to September 30, 2023, the increase was primarily driven by assets acquired in the Denver Bankshares, Inc. ("DNVB") transaction, as well as higher cash and loan balances, partially offset by the sale of assets associated with our Florida banking operations, and lower securities balances.
Loans Held for Investment
September 30, 2024
June 30, 2024
September 30, 2023
Balance
% ofTotal
Balance
% ofTotal
Balance
% ofTotal
(Dollars in thousands)
Commercial and industrial
$
1,149,758
26.6
%
$
1,120,983
26.1
%
$
1,078,773
26.5
%
Agricultural
112,696
2.6
107,983
2.5
111,950
2.8
Commercial real estate
Construction and development
386,920
8.9
351,646
8.2
331,868
8.2
Farmland
182,164
4.2
183,641
4.3
182,621
4.5
Multifamily
409,544
9.5
430,054
10.0
337,509
8.3
Other
1,353,513
31.2
1,348,515
31.5
1,324,019
32.5
Total commercial real estate
2,332,141
53.8
2,313,856
54.0
2,176,017
53.5
Residential real estate
One-to-four family first liens
485,210
11.2
492,541
11.5
456,771
11.2
One-to-four family junior liens
176,827
4.1
176,105
4.1
173,275
4.3
Total residential real estate
662,037
15.3
668,646
15.6
630,046
15.5
Consumer
72,124
1.7
75,764
1.8
69,183
1.7
Loans held for investment, net of unearned income
$
4,328,756
100.0
%
$
4,287,232
100.0
%
$
4,065,969
100.0
%
Total commitments to extend credit
$
1,149,815
$
1,200,605
$
1,251,345
Loans held for investment, net of unearned income, increased $41.5 million, or 1.0%, to $4.33 billion from $4.29 billion at June 30, 2024. The increase from the second quarter of 2024 was driven primarily by organic loan growth and higher line of credit usage.
Loans held for investment, net of unearned income, increased $262.8 million, or 6.5%, to $4.33 billion from $4.07 billion at September 30, 2023. The increase from the third quarter of 2023 was driven primarily by the loans acquired in the DNVB transaction, organic loan growth, and higher line of credit usage. Partially offsetting these identified increases was a decline stemming from the sale of loans associated with our Florida banking operations.
Investment Securities
September 30, 2024
June 30, 2024
September 30, 2023
(Dollars in thousands)
Balance
% of Total
Balance
% of Total
Balance
% of Total
Available for sale
$
1,623,104
100.0
%
$
771,034
42.3
%
$
872,770
44.6
%
Held to maturity
—
—
%
1,053,080
57.7
%
1,085,751
55.4
%
Total investment securities
$
1,623,104
$
1,824,114
$
1,958,521
Investment securities at September 30, 2024 were $1.62 billion, decreasing $201.0 million from June 30, 2024 and $335.4 million from September 30, 2023. The decrease from the second quarter of 2024 stemmed from impairment recognized in the third quarter of 2024 related to the balance sheet repositioning, fair value adjustments recognized in the third quarter of 2024 in connection with the re-classification of held-to-maturity securities to available-for-sale, and principal cash flows received from scheduled payments, calls, and maturities. The decrease from the third quarter of 2023 was primarily due to the balance sheet repositioning executed in the fourth quarter of 2023, impairment recognized in the third quarter of 2024 related to the balance sheet repositioning, fair value adjustments recognized in the third quarter of 2024 in connection with the re-classification of held-to-maturity securities to available-for-sale, and principal cash flows received from scheduled payments, calls, and maturities.
Deposits
September 30, 2024
June 30, 2024
September 30, 2023
(Dollars in thousands)
Balance
% of Total
Balance
% of Total
Balance
% of Total
Noninterest bearing deposits
$
917,715
17.1
%
$
882,472
16.3
%
$
924,213
17.2
%
Interest checking deposits
1,230,605
23.0
1,284,243
23.7
1,334,481
24.9
Money market deposits
1,038,575
19.3
1,043,376
19.3
1,127,287
21.0
Savings deposits
768,298
14.3
745,639
13.8
619,805
11.6
Time deposits of $250 and under
844,298
15.7
803,301
14.8
703,646
13.1
Total core deposits
4,799,491
89.4
4,759,031
87.9
4,709,432
87.8
Brokered time deposits
200,000
3.7
196,000
3.6
220,063
4.1
Time deposits over $250
369,236
6.9
457,388
8.5
433,829
8.1
Total deposits
$
5,368,727
100.0
%
$
5,412,419
100.0
%
$
5,363,324
100.0
%
Total deposits declined $43.7 million, or 0.8%, to $5.37 billion, from $5.41 billion at June 30, 2024. Noninterest bearing deposits increased $35.2 million, while core deposits increased $40.5 million from June 30, 2024. Time deposits over $250 decreased $88.2 million from June 30, 2024, primarily as a result of a decline in public funds. Total deposits increased $5.4 million, or 0.1%, from $5.36 billion at September 30, 2023, primarily due to $224.2 million of deposits assumed in the DNVB acquisition, partially offset by $133.3 million of deposits divested as part of the sale of our Florida banking operations and a decline of $20.1 million in brokered deposits.
Borrowed Funds
September 30, 2024
June 30, 2024
September 30, 2023
(Dollars in thousands)
Balance
% of Total
Balance
% of Total
Balance
% of Total
Short-term borrowings
$
410,630
78.1
%
$
414,684
78.3
%
$
373,956
75.0
%
Long-term debt
115,051
21.9
%
114,839
21.7
%
124,526
25.0
%
Total borrowed funds
$
525,681
$
529,523
$
498,482
Borrowed funds were $525.7 million at September 30, 2024, a decrease of $3.8 million from June 30, 2024 and an increase of $27.2 million from September 30, 2023. The decrease compared to the linked quarter was due to a decrease in overnight borrowings from the Federal Home Loan Bank ("FHLB") and scheduled payments on long-term debt, partially offset by an increase in long-term FHLB borrowings. The increase compared to September 30, 2023 was due to higher Bank Term Funding Program borrowings, partially offset by lower overnight borrowings from the Federal Home Loan Bank, securities sold under agreements to repurchase, and scheduled payments on long-term debt.
Capital
September 30,
June 30,
September 30,
(Dollars in thousands)
2024 (1)
2024
2023
Total shareholders' equity
$
562,238
$
543,286
$
505,411
Accumulated other comprehensive loss
(58,842
)
(58,135
)
(84,606
)
MidWestOne Financial Group, Inc. Consolidated
Tier 1 leverage to average assets ratio
8.78
%
8.29
%
8.58
%
Common equity tier 1 capital to risk-weighted assets ratio
9.91
%
9.56
%
9.52
%
Tier 1 capital to risk-weighted assets ratio
10.70
%
10.35
%
10.31
%
Total capital to risk-weighted assets ratio
12.96
%
12.62
%
12.45
%
MidWestOne Bank
Tier 1 leverage to average assets ratio
9.69
%
9.24
%
9.51
%
Common equity tier 1 capital to risk-weighted assets ratio
11.83
%
11.55
%
11.43
%
Tier 1 capital to risk-weighted assets ratio
11.83
%
11.55
%
11.43
%
Total capital to risk-weighted assets ratio
12.88
%
12.61
%
12.36
%
(1) Regulatory capital ratios for September 30, 2024 are preliminary
Total shareholders' equity at September 30, 2024 increased $19.0 million from June 30, 2024, primarily driven by an increase in the balance of common stock and additional paid-in-capital stemming from the common stock capital raise executed in the third quarter of 2024, partially offset by a decline in retained earnings. Total shareholders' equity at September 30, 2024 increased $56.8 million from September 30, 2023, primarily due to increases in common stock and additional paid-in-capital stemming from the common stock issuance previously described and decreases in accumulated other comprehensive loss and treasury stock, partially offset by a decline in retained earnings.
On October 23, 2024, the Board of Directors of the Company declared a cash dividend of $0.2425 per common share. The dividend is payable December 16, 2024, to shareholders of record at the close of business on December 2, 2024.
No common shares were repurchased by the Company during the period June 30, 2024 through September 30, 2024 or for the subsequent period through October 24, 2024. The current share repurchase program allows for the repurchase of up to $15.0 million of the Company's common shares. As of September 30, 2024, $15.0 million remained available under this program.
CREDIT QUALITY REVIEW
Credit Quality
As of or For the Three Months Ended
September 30,
June 30,
September 30,
(Dollars in thousands)
2024
2024
2023
Credit loss expense related to loans
$
1,835
$
467
$
1,651
Net charge-offs
1,735
524
451
Allowance for credit losses
54,000
53,900
51,600
Pass
$
4,016,683
$
3,991,692
$
3,785,908
Special Mention / Watch
177,241
146,253
163,222
Classified
134,832
149,287
116,839
Loans greater than 30 days past due and accruing
$
11,940
$
9,358
$
6,449
Nonperforming loans
$
21,954
$
25,128
$
28,987
Nonperforming assets
25,537
31,181
28,987
Net charge-off ratio(1)
0.16
%
0.05
%
0.04
%
Classified loans ratio(2)
3.11
%
3.48
%
2.87
%
Nonperforming loans ratio(3)
0.51
%
0.59
%
0.71
%
Nonperforming assets ratio(4)
0.39
%
0.47
%
0.45
%
Allowance for credit losses ratio(5)
1.25
%
1.26
%
1.27
%
Allowance for credit losses to nonaccrual loans ratio(6)
260.84
%
218.26
%
178.63
%
(1) Net charge-off ratio is calculated as annualized net charge-offs divided by the sum of average loans held for investment, net of unearned income and average loans held for sale, during the period.
(2) Classified loans ratio is calculated as classified loans divided by loans held for investment, net of unearned income, at the end of the period.
(3) Nonperforming loans ratio is calculated as nonperforming loans divided by loans held for investment, net of unearned income, at the end of the period.
(4) Nonperforming assets ratio is calculated as nonperforming assets divided by total assets at the end of the period.
(5) Allowance for credit losses ratio is calculated as allowance for credit losses divided by loans held for investment, net of unearned income, at the end of the period.
(6)Allowance for credit losses to nonaccrual loans ratio is calculated as allowance for credit losses divided by nonaccrual loans at the end of the period.
Compared to the linked quarter, the nonperforming loans and nonperforming assets ratios each declined 8 bps, to 0.51% and 0.39%, respectively, due to the proactive resolution of several large troubled assets. Special mention/watch loan balances increased $31.0 million, or 21%, from the linked quarter, while classified loan balances decreased $14.5 million, or 10%, from the linked quarter. When compared to the same period of the prior year, the nonperforming loans and nonperforming asset ratios decreased 20 bps and 6 bps, respectively. The net charge-off ratio increased 11 bps from the linked quarter and increased 12 bps from the same period in the prior year.
As of September 30, 2024, the allowance for credit losses was $54.0 million and the allowance for credit losses ratio was 1.25%, compared with $53.9 million and 1.26%, respectively, at June 30, 2024. Credit loss expense of $1.5 million in the third quarter of 2024 reflected an additional reserve taken to support organic loan growth, offset by a reduction of $0.3 million in the reserve for unfunded loan commitments.
Nonperforming Loans Roll Forward
Nonaccrual
90+ Days Past Due& Still Accruing
Total
(Dollars in thousands)
Balance at June 30, 2024
$
24,695
$
433
$
25,128
Loans placed on nonaccrual or 90+ days past due & still accruing
6,426
1,326
7,752
Proceeds related to repayment or sale
(7,761
)
(1
)
(7,762
)
Loans returned to accrual status or no longer past due
(500
)
(339
)
(839
)
Charge-offs
(1,609
)
(167
)
(1,776
)
Transfers to foreclosed assets
(549
)
—
(549
)
Balance at September 30, 2024
$
20,702
$
1,252
$
21,954
CONFERENCE CALL DETAILS
The Company will host a conference call for investors at 11:00 a.m. CT on Friday, October 25, 2024. To participate, you may pre-register for this call utilizing the following link: https://www.netroadshow.com/events/login?show=e1a9f566&confId=71942.
After pre-registering for this event you will receive your access details via email. On the day of the call, you are also able to dial 1-833-470-1428 using an access code of 019041 at least fifteen minutes before the call start time. If you are unable to participate on the call, a replay will be available until January 23, 2025 by calling 1-866-813-9403 and using the replay access code of 718549. A transcript of the call will also be available on the Company's web site (www.midwestonefinancial.com) within three business days of the call.
ABOUT MIDWESTONE FINANCIAL GROUP, INC.
MidWestOne Financial Group, Inc. is a financial holding company headquartered in Iowa City, Iowa. MidWestOne is the parent company of MidWestOne Bank, which operates banking offices in Iowa, Minnesota, Wisconsin, and Colorado. MidWestOne provides electronic delivery of financial services through its website, MidWestOne.bank. MidWestOne Financial Group, Inc. trades on the Nasdaq Global Select Market under the symbol "MOFG".
Cautionary Note Regarding Forward-Looking Statements
This release contains certain "forward-looking statements" within the meaning of such term in the Private Securities Litigation Reform Act of 1995. We and our representatives may, from time to time, make written or oral statements that are "forward-looking" and provide information other than historical information. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any results, levels of activity, performance or achievements expressed or implied by any forward-looking statement. These factors include, among other things, the factors listed below. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of our management and on information currently available to management, are generally identifiable by the use of words such as "believe," "expect," "anticipate," "should," "could," "would," "plans," "goals," "intend," "project," "estimate," "forecast," "may" or similar expressions. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those expressed in, or implied by, these statements. Readers are cautioned not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Additionally, we undertake no obligation to update any statement in light of new information or future events, except as required under federal securities law.
Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors that could have an impact on our ability to achieve operating results, growth plan goals and future prospects include, but are not limited to, the following: (1) the risks of mergers or branch sales (including the recent sale of our Florida banking operations and the acquisition of DNVB), including, without limitation, the related time and costs of implementing such transactions, integrating operations as part of these transactions and possible failures to achieve expected gains, revenue growth and/or expense savings from such transactions; (2) credit quality deterioration, pronounced and sustained reduction in real estate market values, or other uncertainties, including the impact of inflationary pressures on economic conditions and our business, resulting in an increase in the allowance for credit losses, an increase in the credit loss expense, and a reduction in net earnings; (3) the effects of changes in interest rates, including on our net income and the value of our securities portfolio; (4) changes in the economic environment, competition, or other factors that may affect our ability to acquire loans or influence the anticipated growth rate of loans and deposits and the quality of the loan portfolio and loan and deposit pricing; (5) fluctuations in the value of our investment securities; (6) governmental monetary and fiscal policies; (7) changes in and uncertainty related to benchmark interest rates used to price loans and deposits; (8) legislative and regulatory changes, including changes in banking, securities, trade, and tax laws and regulations and their application by our regulators, and any changes in response to the failures of other banks; (9) the ability to attract and retain key executives and employees experienced in banking and financial services; (10) the sufficiency of the allowance for credit losses to absorb the amount of actual losses inherent in our existing loan portfolio; (11) our ability to adapt successfully to technological changes to compete effectively in the marketplace; (12) credit risks and risks from concentrations (by geographic area and by industry) within our loan portfolio; (13) the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds, financial technology companies, and other financial institutions operating in our markets or elsewhere or providing similar services; (14) the failure of assumptions underlying the establishment of allowances for credit losses and estimation of values of collateral and various financial assets and liabilities; (15) volatility of rate-sensitive deposits; (16) operational risks, including data processing system failures or fraud; (17) asset/liability matching risks and liquidity risks; (18) the costs, effects and outcomes of existing or future litigation; (19) changes in general economic, political, or industry conditions, nationally, internationally or in the communities in which we conduct business, including the risk of a recession; (20) changes in accounting policies and practices, as may be adopted by state and federal regulatory agencies and the Financial Accounting Standards Board; (21) war or terrorist activities, including the ongoing conflict in the Middle East and the Russian invasion of Ukraine, widespread disease or pandemic, or other adverse external events, which may cause deterioration in the economy or cause instability in credit markets; (22) the occurrence of fraudulent activity, breaches, or failures of our or our third-party vendors' information security controls or cyber-security related incidents, including as a result of sophisticated attacks using artificial intelligence and similar tools; (23) the imposition of tariffs or other domestic or international governmental policies impacting the value of the agricultural or other products of our borrowers; (24) potential changes in federal policy and at regulatory agencies as a result of the upcoming 2024 presidential election; (25) the concentration of large deposits from certain clients, including those who have balances above current FDIC insurance limits; (26) the effects of recent developments and events in the financial services industry, including the large-scale deposit withdrawals over a short period of time that resulted in recent bank failures; and (27) other risk factors detailed from time to time in Securities and Exchange Commission filings made by the Company.
MIDWESTONE FINANCIAL GROUP, INC. FIVE QUARTER CONSOLIDATED BALANCE SHEETS
September 30,
June 30,
March 31,
December 31,
September 30,
(In thousands)
2024
2024
2024
2023
2023
ASSETS
Cash and due from banks
$
72,173
$
66,228
$
68,430
$
76,237
$
71,015
Interest earning deposits in banks
129,695
35,340
29,328
