Midland States Bancorp (MSBI) Q3 2024 earnings summary

Executive summary

• Q3 2024 net income ranged from $16.2 million to $18.5 million, with diluted EPS of $0.74, reflecting improved profitability and higher noninterest income.

• Tangible book value per share increased to $24.90, and CET1 ratio rose to 9.00%.

• Wealth Management assets under administration rose to $4.27 billion, driven by new assets and market performance.

• Community bank and St. Louis region loans grew, while equipment finance and consumer portfolios declined.

• Management emphasized improved capital, liquidity, and a focus on higher-quality, lower-risk lending.

Financial highlights

• Total assets were $7.8 billion, total loans $5.7 billion, and total deposits $6.3 billion as of September 30, 2024.

• Net interest income was $55.0 million, with net interest margin at 3.10%, down from prior year.

• Noninterest income reached $19.3 million, up from $11.5 million in Q3 2023, driven by wealth management and investment gains.

• Noninterest expense increased to $46.7 million, mainly due to higher salaries and data processing.

• Efficiency ratio improved to 62.8% from 65.2% in the prior quarter.

Outlook and guidance

• Positioned to benefit from lower interest rates, with lower funding costs expected to expand net interest margin in 2025.

• Loan pipeline remains steady; new community bank loan production will partially offset runoff from GreenSky and equipment finance portfolios.

• Disciplined expense management and investments in talent and technology to drive future growth.

• Wealth Management revenue expected to trend higher; BaaS initiative continues to seek quality FinTech partners.

• No material changes to risk factors or critical accounting policies anticipated for the remainder of 2024.