Midland States Bancorp (MSBI) Q1 2026 earnings summary

Executive summary

• Net income for Q1 2026 was $18.5 million, reversing a net loss of $141.0 million in Q1 2025, primarily due to the absence of a prior year goodwill impairment and lower provision for credit losses.

• Diluted EPS was $0.74, with adjusted diluted EPS at $0.79; return on average assets was 1.16%.

• Net interest margin expanded to 3.91%, up 17 bps from last quarter, driven by lower deposit costs and improved securities mix.

• Total assets increased slightly to $6.55 billion as of March 31, 2026.

• Wealth Management assets under administration remained stable at $4.47 billion, with revenue of $8.2 million.

Financial highlights

• Net interest income was $57.4 million, benefiting from a 14 bp reduction in deposit costs.

• Noninterest income was $22.1 million, up year-over-year, including $2.1 million gains from servicing portfolio sales and $1.7 million losses from investment securities.

• Noninterest expense dropped to $50.4 million, reflecting the absence of a $154.0 million goodwill impairment in Q1 2025.

• Provision for credit losses was $5.0 million, down from $10.9 million in Q1 2025 and $11.8 million in Q4 2025.

• Efficiency ratio improved to 62.2% from 63.0% last quarter.

Outlook and guidance

• Management expects continued improvement in credit quality and efficiency, with a focus on growing the Community Bank and wealth management businesses.

• Near-term focus on stable total assets, relationship community banking, and growing regulatory capital.

• Effective tax rate for the full year is expected to be approximately 22%-23%.

• Nonperforming assets are trending toward a 0.75% target.