株探米国株
日本語 英語
エドガーで原本を確認する
0001412665false00014126652024-04-252024-04-25

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) April 25, 2024
MidWestOne Financial Group, Inc.
(Exact name of registrant as specified in its charter)
Commission file number 001-35968
 
Iowa   42-1206172
(State or other jurisdiction
of incorporation)
  
(I.R.S. Employer
Identification Number)
102 South Clinton Street
Iowa City, Iowa 52240
(Address of principal executive offices, including zip code)
(319) 356-5800
(Registrant’s telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):
 
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
Common stock, $1.00 par value MOFG The Nasdaq Stock Market LLC
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐


Item 2.02.     Results of Operations and Financial Condition.
On April 25, 2024, MidWestOne Financial Group, Inc. (the “Company”) issued a press release announcing its earnings for the three months ended March 31, 2024. The press release is furnished herewith as Exhibit 99.1. In addition, the Company is providing a financial supplement furnished as Exhibit 99.2 to this Current Report on Form 8-K.
The information in this item and the attached press release and financial supplement shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in any such filing.
Item 8.01.    Other Events.
The Board of Directors of the Company declared a cash dividend of $0.2425 per common share on April 25, 2024. The dividend is payable June 17, 2024, to shareholders of record at the close of business on June 3, 2024.
Item 9.01.    Financial Statements and Exhibits.
(d)    Exhibits.
MidWestOne Financial Group, Inc. press release dated April 25, 2024
MidWestOne Financial Group, Inc. financial supplement dated April 25, 2024
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)



SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

MIDWESTONE FINANCIAL GROUP, INC.
Dated: April 25, 2024 By:
/s/ BARRY S. RAY
Barry S. Ray
Chief Financial Officer



EX-99.1 2 financialresultsq12024.htm EX-99.1 Document

mofglogoa01a.jpg
FOR IMMEDIATE RELEASE April 25, 2024

MIDWESTONE FINANCIAL GROUP, INC.
REPORTS FINANCIAL RESULTS FOR THE
FIRST QUARTER OF 2024

Iowa City, Iowa - MidWestOne Financial Group, Inc. (Nasdaq: MOFG) (“we”, “our”, or the "Company”) today reported results for the first quarter of 2024.
First Quarter 2024 Summary1
•Completed acquisition of Denver Bankshares, Inc. ("DNVB"), the related core banking system conversion, and closure of the legacy MidWestOne Denver banking office.
•Net income of $3.3 million, or $0.21 per diluted common share.
◦Revenue was $44.5 million, comprised of net interest income of $34.7 million and noninterest income of $9.8 million, which included a negative MSR valuation adjustment of $368 thousand.
◦Credit loss expense of $4.7 million, which included day 1 credit loss expense of $3.2 million related to the DNVB acquisition.
◦Noninterest Expense of $35.6 million, which included merger-related costs of $1.3 million, OREO write-down expense of $311 thousand, and non-acquisition related severance expense of $261 thousand.
•Net interest margin (tax equivalent) expanded 11 bps to 2.33%2.
•Annualized adjusted loan growth (excluding acquired DNVB loan balances) of 8%.
•Continued momentum in Wealth Management with revenue growth of 10%.
•Nonperforming assets ratio remained stable at 0.49%; net charge-off ratio was 0.02%.
CEO Commentary
Charles (Chip) Reeves, Chief Executive Officer of the Company, commented, “We are very pleased with the underlying strength of the first quarter as we continue to execute on our strategic initiatives. During the quarter we closed and integrated Denver Bankshares, the front end of our geographic realignment announced in late September 2023, and our Florida divestiture remains on track for a June 2024 closing.

Importantly, our net interest margin expanded this quarter, rising 11 bps, with net interest income increasing 7% from the fourth quarter of 2023. This outcome reflected the strategic balance sheet actions taken in 2023, the completed merger of DNVB, and continued loan growth in our targeted metro markets.

In Commercial Banking and Wealth Management, our customer and banker acquisition strategies led to robust balance sheet, assets under management, and revenue gains, and we will continue to invest in these critical business lines. Even amidst significant talent, platform, and product investments, we have been able to re-allocate resources to maintain expense discipline.

We welcome our new Bank of Denver team members, and I am proud of our entire MidWestOne team for their commitment to our customers and execution of our strategic plan."

1 First Quarter Summary compares to the fourth quarter of 2023 (the "linked quarter") unless noted.
2 Non-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
(Dollars in thousands, except per share amounts and as noted) March 31, December 31, March 31,
2024 2023 2023
Financial Results
Revenue $ 44,481  $ 36,421  $ 36,030 
Credit loss expense 4,689  1,768  933 
Noninterest expense 35,565  32,131  33,319 
Net income 3,269  2,730  1,397 
Per Common Share
Diluted earnings per share $ 0.21  $ 0.17  $ 0.09 
Book value 33.53  33.41  31.94 
Tangible book value(1)
 27.14  27.90  26.13 
Balance Sheet & Credit Quality
Loans In millions
 $ 4,414.6  $ 4,126.9  $ 3,919.4 
Investment securities In millions
 1,862.2  1,870.3  2,071.8 
Deposits In millions
 5,585.2  5,395.7  5,555.2 
Net loan charge-offs In millions
 0.2  2.1  0.3 
Allowance for credit losses ratio 1.27  % 1.25  % 1.27  %
Selected Ratios
Return on average assets 0.20  % 0.17  % 0.09  %
Net interest margin, tax equivalent(1)
 2.33  % 2.22  % 2.75  %
Return on average equity 2.49  % 2.12  % 1.14  %
Return on average tangible equity(1)
 4.18  % 3.57  % 2.70  %
Efficiency ratio(1)
 71.28  % 70.16  % 62.32  %
(1) Non-GAAP measure. See the Non-GAAP Measures section for a reconciliation to the most directly comparable GAAP measure.
DENVER BANKSHARES, INC. ACQUISITION

On January 31, 2024, we completed our acquisition of Denver Bankshares, Inc, and its wholly-owned banking subsidiary, the Bank of Denver. The assets acquired and liabilities assumed have been accounted for under the acquisition method of accounting. The assets and liabilities, both tangible and intangible, were recorded at their fair values as of the January 31, 2024 acquisition date, net of any applicable tax effects. The Company considers all purchase accounting estimates provisional and fair values are subject to refinement for up to one year after the close date.
The table below summarizes the amounts recognized at the acquisition date for each major class of assets acquired and liabilities assumed:
(In thousands) As of January 31, 2024
Merger consideration
     Cash consideration $ 32,600 
Identifiable net assets acquired, at fair value
Assets acquired
     Cash and due from banks 462 
     Interest earning deposits in banks 3,517 
     Debt securities 52,493 
     Loans held for investment 207,095 
     Premises and equipment 13,470 
     Core deposit intangible 7,100 
     Other assets 4,987 
          Total assets acquired 289,124 
Liabilities assumed
     Deposits (224,248)
     Short-term borrowings (37,500)
     Other liabilities (3,417)
          Total liabilities assumed (265,165)
Identifiable net assets acquired, at fair value 23,959 
Goodwill $ 8,641 






2

REVENUE REVIEW

Revenue Change Change
1Q24 vs 1Q24 vs
(Dollars in thousands) 1Q24 4Q23 1Q23 4Q23 1Q23
Net interest income $ 34,731  $ 32,559  $ 40,076  7  % (13) %
Noninterest income 9,750  3,862  (4,046) 152  % n/m
Total revenue, net of interest expense $ 44,481  $ 36,421  $ 36,030  22  % 23  %
Results are not meaningful (n/m)
Total revenue for the first quarter of 2024 increased $8.1 million from the fourth quarter of 2023 due to higher noninterest income and net interest income during the quarter. When compared to the first quarter of 2023, total revenue increased $8.5 million due to higher noninterest income, partially offset by lower net interest income.
Net interest income of $34.7 million for the first quarter of 2024 increased $2.2 million from the fourth quarter of 2023, primarily due to higher interest earning asset volumes and yields, partially offset by higher interest bearing liabilities volumes and funding costs. When compared to the first quarter of 2023, net interest income decreased $5.3 million, primarily due to higher funding costs and volumes, partially offset by higher interest earning asset volumes and yields.
The Company's tax equivalent net interest margin was 2.33%3 in the first quarter of 2024, compared to 2.22%3 in the fourth quarter of 2023, as higher earning asset yields more than offset increased funding costs. Total interest earning assets yield during the first quarter of 2024 increased 20 bps from the fourth quarter of 2023, as a result of increased loan and securities yields of 17 bps and 10 bps, respectively. The cost of interest bearing liabilities during the first quarter of 2024 increased 10 bps, to 2.75%, due primarily to interest bearing deposit costs of 2.45% and long-term debt of 6.86%, which increased 6 bps and 7 bps, respectively, from the fourth quarter of 2023, as well as a mix-shift to increased short-term borrowings. Our cycle-to-date interest bearing deposit beta was 41%.
The Company's tax equivalent net interest margin was 2.33%3 in the first quarter of 2024, compared to 2.75%3 in the first quarter of 2023, driven by higher funding costs, partially offset by higher interest earning asset yields. The cost of interest bearing liabilities increased 116 bps to 2.75%, due to interest bearing deposit costs of 2.45%, short-term borrowing costs of 4.82%, and long-term debt costs of 6.86%, which increased 107 bps, 200 bps and 67 bps, respectively from the first quarter of 2023. Total interest earning assets yield increased 56 bps from the first quarter of 2023, primarily as a result of an increase in loan yields of 56 bps.
Noninterest Income (Loss) Change Change
1Q24 vs 1Q24 vs
(In thousands) 1Q24 4Q23 1Q23 4Q23 1Q23
Investment services and trust activities $ 3,503  $ 3,193  $ 2,933  10  % 19  %
Service charges and fees 2,144  2,148  2,008  —  % 7  %
Card revenue 1,943  1,802  1,748  8  % 11  %
Loan revenue 856  909  1,420  (6) % (40) %
Bank-owned life insurance 660  656  602  1  % 10  %
Investment securities gains (losses), net 36  (5,696) (13,170) n/m n/m
Other 608  850  413  (28) % 47  %
Total noninterest income (loss) $ 9,750  $ 3,862  $ (4,046) 152  % n/m
MSR Valuation Adjustment (included in loan revenue) (368) (105) 315  250  % (217) %
Results are not meaningful (n/m)
Noninterest income for the first quarter of 2024 increased $5.9 million from the linked quarter, primarily due to investment securities losses, net, of $5.7 million recorded in the fourth quarter of 2023 as part of a balance sheet repositioning, which did not recur in the first quarter of 2024. Investment services and trust activities income increased $0.3 million during the first quarter of 2024, as a result of growth in assets under administration and market valuation.

3 Non-GAAP measure. See the separate Non-GAAP Measures section for a reconciliation to the most directly comparable GAAP measure.


3

Noninterest income for the first quarter of 2024 increased $13.8 million from the first quarter of 2023, primarily due to the investment securities losses, net, of $13.2 million recorded in the first quarter of 2023 as part of a balance sheet repositioning, which did not recur in the first quarter of 2024. Investment services and trust activities income increased $0.6 million compared to the first quarter of 2023, due to growth in assets under administration. Partially offsetting these identified increases was a decline of $0.6 million in loan revenue, which primarily reflected the unfavorable year-over-year change in the fair value of our mortgage servicing rights, from a positive adjustment of $315 thousand in the first quarter of 2023 to a negative adjustment of $368 thousand in the first quarter of 2024.
EXPENSE REVIEW
Noninterest Expense Change Change
1Q24 vs 1Q24 vs
(In thousands) 1Q24 4Q23 1Q23 4Q23 1Q23
Compensation and employee benefits $ 20,930  $ 17,859  $ 19,607  17  % 7  %
Occupancy expense of premises, net 2,813  2,309  2,746  22  % 2  %
Equipment 2,600  2,466  2,171  5  % 20  %
Legal and professional 2,059  2,269  1,736  (9) % 19  %
Data processing 1,360  1,411  1,363  (4) % —  %
Marketing 598  700  986  (15) % (39) %
Amortization of intangibles 1,637  1,441  1,752  14  % (7) %
FDIC insurance 942  900  749  5  % 26  %
Communications 196  183  261  7  % (25) %
Foreclosed assets, net 358  45  (28) 696  % n/m
Other 2,072  2,548  1,976  (19) % 5  %
     Total noninterest expense $ 35,565  $ 32,131  $ 33,319  11  % 7  %
Results are not meaningful (n/m)
Merger-related Expenses
(In thousands) 1Q24 4Q23 1Q23
Compensation and employee benefits $ 241  $ —  $ 70 
Occupancy expense of premises, net 152  —  — 
Equipment 149  —  — 
Legal and professional 573  180  — 
Data processing 61  —  65 
Marketing 32  38  — 
Communications 1  —  — 
Other 105  27  1 
Total merger-related expenses $ 1,314  $ 245  $ 136 
Noninterest expense for the first quarter of 2024 increased $3.4 million from the linked quarter primarily due to increases of $3.1 million, $0.5 million, and $0.3 million in compensation and employee benefits, occupancy expense of premises, net, and foreclosed assets, net, respectively. The increase in compensation and employee benefits was primarily driven by annual compensation adjustments, increased headcount as a result of the DNVB acquisition, increased incentive and commission expense, and merger-related expenses. The increase in occupancy was primarily driven by additional expense as a result of the DNVB acquisition, merger-related expenses, and increased costs for snow removal. The increase in foreclosed assets expense was driven by a $0.3 million write-down of other real estate owned.
Noninterest expense for the first quarter of 2024 increased $2.2 million from the first quarter of 2023, primarily due to increases of $1.3 million, $0.4 million, and $0.4 million in compensation and employee benefits, equipment, and foreclosed assets, net, respectively. The increase in compensation and employee benefits was primarily driven by annual compensation adjustments, increased headcount as a result of the DNVB acquisition, increased incentive and commission expense, and merger-related expenses. The increase in equipment reflected higher software costs and merger-related expenses. The increase in foreclosed assets, net, was due to a $0.3 million write-down of other real estate owned. Partially offsetting these increases was a decline of $0.4 million in marketing.
The Company's effective tax rate was 22.7% in the first quarter of 2024. The effective income tax rate for 2024 is expected to be 21-23%.


4

BALANCE SHEET REVIEW
Total assets were $6.75 billion at March 31, 2024, compared to $6.43 billion at December 31, 2023 and $6.41 billion at March 31, 2023. The increase from December 31, 2023 was primarily driven by the assets acquired from the acquisition of DNVB and organic loan growth. Compared to March 31, 2023, the increase was primarily driven by the assets acquired from the acquisition of DNVB, organic loan growth, and higher cash balances, partially offset by lower securities balances resulting from balance sheet repositioning executed in 2023.
Loans Held for Investment March 31, 2024 December 31, 2023 March 31, 2023
Balance % of Total Balance % of Total Balance % of Total
(Dollars in thousands)
Commercial and industrial $ 1,105,718  25.0  % $ 1,075,003  26.0  % $ 1,080,514  27.6  %
Agricultural 113,029  2.6  118,414  2.9  106,641  2.7 
Commercial real estate
Construction and development 403,571  9.1  323,195  7.8  320,924  8.2 
Farmland 184,109  4.2  184,955  4.5  182,528  4.7 
Multifamily 409,504  9.3  383,178  9.3  255,065  6.5 
Other 1,440,645  32.7  1,333,982  32.4  1,290,454  33.0 
Total commercial real estate 2,437,829  55.3  2,225,310  54.0  2,048,971  52.4 
Residential real estate
One-to-four family first liens 495,408  11.2  459,798  11.1  448,459  11.4 
One-to-four family junior liens 182,001  4.1  180,639  4.4  162,403  4.1 
Total residential real estate 677,409  15.3  640,437  15.5  610,862  15.5 
Consumer 80,661  1.8  67,783  1.6  72,377  1.8 
Loans held for investment, net of unearned income $ 4,414,646  100.0  % $ 4,126,947  100.0  % $ 3,919,365  100.0  %
Total commitments to extend credit $ 1,230,612  $ 1,210,796  $ 1,205,902 
Loans held for investment, net of unearned income, increased $287.7 million, or 7.0%, to $4.41 billion from $4.13 billion at December 31, 2023 and $495.3 million, or 12.6%, from $3.92 billion at March 31, 2023. This increase from the fourth quarter of 2023 was driven by loans acquired in the DNVB acquisition, organic loan growth, and higher line of credit usage. The increase from the first quarter of 2023 was driven by loans acquired in the DNVB acquisition and organic loan growth.
Investment Securities March 31, 2024 December 31, 2023 March 31, 2023
(Dollars in thousands) Balance % of Total Balance % of Total Balance % of Total
Available for sale $ 797,230  42.8  % $ 795,134  42.5  % $ 954,074  46.1  %
Held to maturity 1,064,939  57.2  % 1,075,190  57.5  % 1,117,709  53.9  %
Total investment securities $ 1,862,169  $ 1,870,324  $ 2,071,783 
Investment securities at March 31, 2024 were $1.86 billion, decreasing $8.2 million from December 31, 2023 and $209.6 million from March 31, 2023. The decrease from the fourth quarter of 2023 was primarily due to the principal cash flows received from scheduled payments, calls, and maturities. The decrease from the first quarter of 2023 was primarily due to balance sheet repositioning executed in 2023.
Deposits March 31, 2024 December 31, 2023 March 31, 2023
(Dollars in thousands) Balance % of Total Balance % of Total Balance % of Total
Noninterest bearing deposits $ 920,764  16.5  % $ 897,053  16.6  % $ 989,469  17.8  %
Interest checking deposits 1,349,823  24.2  1,320,435  24.5  1,476,948  26.6 
Money market deposits 1,122,717  20.1  1,105,493  20.5  969,238  17.4 
Savings deposits 728,276  13.0  650,655  12.1  631,811  11.4 
Time deposits of $250 and under 787,851  14.1  752,214  13.9  599,302  10.8 
Total core deposits 4,909,431  87.9  4,725,850  87.6  4,666,768  84.0 
Brokered time deposits 205,000  3.7  221,039  4.1  366,539  6.6 
Time deposits over $250 470,805  8.4  448,784  8.3  521,846  9.4 
Total deposits
 $ 5,585,236  100.0  % $ 5,395,673  100.0  % $ 5,555,153  100.0  %
Deposits increased $189.6 million, or 3.5%, to $5.59 billion, from $5.40 billion at December 31, 2023, primarily due to the $224.2 million of deposits assumed in the DNVB acquisition. Total deposits increased $30.1 million, or 0.5%, from $5.56 billion at March 31, 2023 due to the DNVB acquisition, partially offset by a decline of $161.5 million in brokered deposits.




5

Borrowed Funds March 31, 2024 December 31, 2023 March 31, 2023
(Dollars in thousands) Balance % of Total Balance % of Total Balance % of Total
Short-term borrowings $ 422,988  77.6  % $ 300,264  70.9  % $ 143,981  51.1  %
Long-term debt 122,066  22.4  % 123,296  29.1  % 137,981  48.9  %
Total borrowed funds $ 545,054  $ 423,560  $ 281,962 

Borrowed funds were $545.1 million at March 31, 2024, an increase of $121.5 million from December 31, 2023 and an increase of $263.1 million from March 31, 2023. The increase compared to the linked quarter was due to higher Bank Term Funding Program borrowings and other short-term borrowings, partially offset by lower Federal Home Loan Bank overnight borrowings. The increase compared to March 31, 2023 was primarily due to higher Bank Term Funding Program borrowings and other short-term borrowings, partially offset by lower Federal Home Loan Bank overnight borrowings and securities sold under agreements to repurchase.
Capital March 31, December 31, March 31,
(Dollars in thousands)
2024 (1)
 2023 2023
Total shareholders' equity $ 528,040  $ 524,378  $ 500,650 
Accumulated other comprehensive loss (60,804) (64,899) (78,885)
MidWestOne Financial Group, Inc. Consolidated
Tier 1 leverage to average assets ratio 8.16  % 8.58  % 8.30  %
Common equity tier 1 capital to risk-weighted assets ratio 8.98  % 9.59  % 9.39  %
Tier 1 capital to risk-weighted assets ratio 9.75  % 10.38  % 10.18  %
Total capital to risk-weighted assets ratio 11.97  % 12.53  % 12.31  %
MidWestOne Bank
Tier 1 leverage to average assets ratio 9.36  % 9.39  % 9.28  %
Common equity tier 1 capital to risk-weighted assets ratio 11.20  % 11.54  % 11.40  %
Tier 1 capital to risk-weighted assets ratio 11.20  % 11.54  % 11.40  %
Total capital to risk-weighted assets ratio 12.25  % 12.49  % 12.31  %
(1) Regulatory capital ratios for March 31, 2024 are preliminary
Total shareholders' equity at March 31, 2024 increased $3.7 million from December 31, 2023, driven by decreases in accumulated other comprehensive loss and treasury stock, partially offset by the decline in additional paid-in capital and retained earnings. Total shareholders' equity at March 31, 2024 increased $27.4 million from March 31, 2023, driven by decreases in accumulated other comprehensive loss and treasury stock, coupled with an increase in retained earnings.
Accumulated other comprehensive loss at March 31, 2024 decreased $4.1 million compared to December 31, 2023, primarily due to an increase in available for sale securities valuations. Accumulated other comprehensive loss decreased $18.1 million from March 31, 2023, primarily due to an increase in available for sale securities valuations and the recognition of the loss from the fourth quarter of 2023 sale of securities.
On April 25, 2024, the Board of Directors of the Company declared a cash dividend of $0.2425 per common share. The dividend is payable June 17, 2024, to shareholders of record at the close of business on June 3, 2024.
No common shares were repurchased by the Company during the period December 31, 2023 through March 31, 2024 or for the subsequent period through April 25, 2024. The current share repurchase program allows for the repurchase of up to $15.0 million of the Company's common shares.


6

CREDIT QUALITY REVIEW

Credit Quality As of or For the Three Months Ended
March 31, December 31, March 31,
(Dollars in thousands) 2024 2023 2023
Credit loss expense related to loans $ 4,589  $ 1,968  $ 933 
Net charge-offs 189  2,068  333 
Allowance for credit losses 55,900  51,500  49,800 
Pass $ 4,098,102  $ 3,846,012  $ 3,728,522 
Special Mention / Watch 152,604  113,029  92,075 
Classified 163,940  167,906  98,768 
Loans greater than 30 days past due and accruing $ 8,772  $ 10,778  $ 4,932 
Nonperforming loans $ 29,267  $ 26,359  $ 14,442 
Nonperforming assets 33,164  30,288  14,442 
Net charge-off ratio(1)
 0.02  % 0.20  % 0.03  %
Classified loans ratio(2)
 3.71  % 4.07  % 2.52  %
Nonperforming loans ratio(3)
 0.66  % 0.64  % 0.37  %
Nonperforming assets ratio(4)
 0.49  % 0.47  % 0.23  %
Allowance for credit losses ratio(5)
 1.27  % 1.25  % 1.27  %
Allowance for credit losses to nonaccrual loans ratio(6)
 197.53  % 198.91  % 344.88  %
(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 remained stable, with slight increases in both ratios of 2 bps, to 0.66% and 0.49%, respectively. Special mention/watch balances increased $39.6 million from the linked quarter primarily due to two trucking industry relationships, while the classified loans ratio decreased 36 bps from the linked quarter. When compared to the prior year, the nonperforming loans and assets ratios increased 29 bps and 26 bps, respectively. Further, the net charge-off ratio declined 18 bps from the linked quarter and 1 bp from the same period in the prior year.
As of March 31, 2024, the allowance for credit losses was $55.9 million and the allowance for credit losses ratio was 1.27%, compared with $51.5 million and 1.25% at December 31, 2023. Credit loss expense of $4.7 million in the first quarter of 2024 reflected $3.2 million of day 1 credit loss expense related to the DNVB acquisition, as well as additional reserve taken to support organic loan growth.
Nonperforming Loans Roll Forward Nonaccrual 90+ Days Past Due & Still Accruing Total
(Dollars in thousands)
Balance at December 31, 2023
 $ 25,891  $ 468  $ 26,359 
Loans placed on nonaccrual or 90+ days past due & still accruing 3,509  1,034  4,543 
Acquired loan portfolio 6  164  170 
Proceeds related to repayment or sale (306) (1) (307)
Loans returned to accrual status or no longer past due (352) (293) (645)
Charge-offs (183) (353) (536)
Transfers to foreclosed assets (265) (16) (281)
Transfer to nonaccrual —  (36) (36)
Balance at March 31, 2024
 $ 28,300  $ 967  $ 29,267 
CONFERENCE CALL DETAILS
The Company will host a conference call for investors at 11:00 a.m. CT on Friday, April 26, 2024. To participate, you may pre-register for this call utilizing the following link: https://www.netroadshow.com/events/login?show=0114d1d0&confId=63215. After pre-registering for this event you will receive your access details via email.


7

On the day of the call, you are also able to dial 1-833-470-1428 using an access code of 891090 at least fifteen minutes before the call start time. If you are unable to participate on the call, a replay will be available until July 25, 2024 by calling 1-866-813-9403 and using the replay access code of 561214. 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, Florida, 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”.


8

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 sale of our Florida branches and the recent 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 significant increases in inflation and interest rates since 2020, 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, including the 1.0% excise tax on stock buybacks by publicly traded companies and any changes in response to the recent 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 Israeli-Palestinian conflict 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 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.


9

MIDWESTONE FINANCIAL GROUP, INC.
FIVE QUARTER CONSOLIDATED BALANCE SHEETS
  March 31, December 31, September 30, June 30, March 31,
(In thousands) 2024 2023 2023 2023 2023
ASSETS
Cash and due from banks $ 68,430  $ 76,237  $ 71,015  $ 75,955  $ 63,945 
Interest earning deposits in banks 29,328  5,479  3,773  68,603  5,273 
Federal funds sold 4  11  —  —  — 
Total cash and cash equivalents 97,762  81,727  74,788  144,558  69,218 
Debt securities available for sale at fair value 797,230  795,134  872,770  903,520  954,074 
Held to maturity securities at amortized cost 1,064,939  1,075,190  1,085,751  1,099,569  1,117,709 
Total securities 1,862,169  1,870,324  1,958,521  2,003,089  2,071,783 
Loans held for sale 2,329  1,045  2,528  2,821  2,553 
Gross loans held for investment 4,433,258  4,138,352  4,078,060  4,031,377  3,932,900 
Unearned income, net (18,612) (11,405) (12,091) (12,728) (13,535)
Loans held for investment, net of unearned income 4,414,646  4,126,947  4,065,969  4,018,649  3,919,365 
Allowance for credit losses (55,900) (51,500) (51,600) (50,400) (49,800)
Total loans held for investment, net 4,358,746  4,075,447  4,014,369  3,968,249  3,869,565 
Premises and equipment, net 95,986  85,742  85,589  85,831  86,208 
Goodwill 71,118  62,477  62,477  62,477  62,477 
Other intangible assets, net 29,531  24,069  25,510  26,969  28,563 
Foreclosed assets, net 3,897  3,929  —  —  — 
Other assets 226,477  222,780  244,036  227,495  219,585 
Total assets $ 6,748,015  $ 6,427,540  $ 6,467,818  $ 6,521,489  $ 6,409,952 
LIABILITIES               
Noninterest bearing deposits $ 920,764  $ 897,053  $ 924,213  $ 897,923  $ 989,469 
Interest bearing deposits 4,664,472  4,498,620  4,439,111  4,547,524  4,565,684 
Total deposits 5,585,236  5,395,673  5,363,324  5,445,447  5,555,153 
Short-term borrowings 422,988  300,264  373,956  362,054  143,981 
Long-term debt 122,066  123,296  124,526  125,752  137,981 
Other liabilities 89,685  83,929  100,601  86,895  72,187 
Total liabilities 6,219,975  5,903,162  5,962,407  6,020,148  5,909,302 
SHAREHOLDERS' EQUITY               
Common stock 16,581  16,581  16,581  16,581  16,581 
Additional paid-in capital 300,845  302,157  301,889  301,424  300,966 
Retained earnings 294,066  294,784  295,862  290,548  286,767 
Treasury stock (22,648) (24,245) (24,315) (24,508) (24,779)
Accumulated other comprehensive loss (60,804) (64,899) (84,606) (82,704) (78,885)
Total shareholders' equity 528,040  524,378  505,411  501,341  500,650 
Total liabilities and shareholders' equity $ 6,748,015  $ 6,427,540  $ 6,467,818  $ 6,521,489  $ 6,409,952 




10

MIDWESTONE FINANCIAL GROUP, INC.
FIVE QUARTER CONSOLIDATED STATEMENTS OF INCOME
  Three Months Ended
March 31, December 31, September 30, June 30, March 31,
(In thousands, except per share data) 2024 2023 2023 2023 2023
Interest income
Loans, including fees $ 57,947  $ 54,093  $ 51,870  $ 49,726  $ 46,490 
Taxable investment securities 9,460  9,274  9,526  9,734  10,444 
Tax-exempt investment securities 1,710  1,789  1,802  1,822  2,127 
Other 418  230  374  68  244 
Total interest income 69,535  65,386  63,572  61,350  59,305 
Interest expense
Deposits 27,726  27,200  23,128  20,117  15,319 
Short-term borrowings 4,975  3,496  3,719  2,118  1,786 
Long-term debt 2,103  2,131  2,150  2,153  2,124 
Total interest expense 34,804  32,827  28,997  24,388  19,229 
Net interest income 34,731  32,559  34,575  36,962  40,076 
Credit loss expense 4,689  1,768  1,551  1,597  933 
Net interest income after credit loss expense 30,042  30,791  33,024  35,365  39,143 
Noninterest income (loss)
Investment services and trust activities 3,503  3,193  3,004  3,119  2,933 
Service charges and fees 2,144  2,148  2,146  2,047  2,008 
Card revenue 1,943  1,802  1,817  1,847  1,748 
Loan revenue 856  909  1,462  909  1,420 
Bank-owned life insurance 660  656  626  616  602 
Investment securities gains (losses), net 36  (5,696) 79  (2) (13,170)
Other 608  850  727  210  413 
Total noninterest income (loss) 9,750  3,862  9,861  8,746  (4,046)
Noninterest expense
Compensation and employee benefits 20,930  17,859  18,558  20,386  19,607 
Occupancy expense of premises, net 2,813  2,309  2,405  2,574  2,746 
Equipment 2,600  2,466  2,123  2,435  2,171 
Legal and professional 2,059  2,269  1,678  1,682  1,736 
Data processing 1,360  1,411  1,504  1,521  1,363 
Marketing 598  700  782  1,142  986 
Amortization of intangibles 1,637  1,441  1,460  1,594  1,752 
FDIC insurance 942  900  783  862  749 
Communications 196  183  206  260  261 
Foreclosed assets, net 358  45  2  (6) (28)
Other 2,072  2,548  2,043  2,469  1,976 
Total noninterest expense 35,565  32,131  31,544  34,919  33,319 
Income before income tax expense 4,227  2,522  11,341  9,192  1,778 
Income tax expense (benefit) 958  (208) 2,203  1,598  381 
Net income $ 3,269  $ 2,730  $ 9,138  $ 7,594  $ 1,397 
Earnings per common share
Basic $ 0.21  $ 0.17  $ 0.58  $ 0.48  $ 0.09 
Diluted $ 0.21  $ 0.17  $ 0.58  $ 0.48  $ 0.09 
Weighted average basic common shares outstanding 15,723  15,693  15,689  15,680  15,650 
Weighted average diluted common shares outstanding 15,774  15,756  15,711  15,689  15,691 
Dividends paid per common share $ 0.2425  $ 0.2425  $ 0.2425  $ 0.2425  $ 0.2425 






11

MIDWESTONE FINANCIAL GROUP, INC.
FINANCIAL STATISTICS
As of or for the Three Months Ended
March 31, December 31, March 31,
(Dollars in thousands, except per share amounts) 2024 2023 2023
Earnings:
Net interest income $ 34,731  $ 32,559  $ 40,076 
Noninterest income 9,750  3,862  (4,046)
     Total revenue, net of interest expense 44,481  36,421  36,030 
Credit loss expense 4,689  1,768  933 
Noninterest expense 35,565  32,131  33,319 
     Income before income tax expense 4,227  2,522  1,778 
Income tax expense (benefit) 958  (208) 381 
     Net income $ 3,269  $ 2,730  $ 1,397 
Per Share Data:
Diluted earnings $ 0.21  $ 0.17  $ 0.09 
Book value 33.53  33.41  31.94 
Tangible book value(1)
 27.14  27.90  26.13 
Ending Balance Sheet:
Total assets $ 6,748,015  $ 6,427,540  $ 6,409,952 
Loans held for investment, net of unearned income 4,414,646  4,126,947  3,919,365 
Total securities 1,862,169  1,870,324  2,071,783 
Total deposits 5,585,236  5,395,673  5,555,153 
Short-term borrowings 422,988  300,264  143,981 
Long-term debt 122,066  123,296  137,981 
Total shareholders' equity 528,040  524,378  500,650 
Average Balance Sheet:
Average total assets $ 6,635,379  $ 6,459,705  $ 6,524,065 
Average total loans 4,298,216  4,080,243  3,867,110 
Average total deposits 5,481,114  5,443,323  5,546,694 
Financial Ratios:
Return on average assets 0.20  % 0.17  % 0.09  %
Return on average equity 2.49  % 2.12  % 1.14  %
Return on average tangible equity(1)
 4.18  % 3.57  % 2.70  %
Efficiency ratio(1)
 71.28  % 70.16  % 62.32  %
Net interest margin, tax equivalent(1)
 2.33  % 2.22  % 2.75  %
Loans to deposits ratio 79.04  % 76.49  % 70.55  %
Common equity ratio 7.83  % 8.16  % 7.81  %
Tangible common equity ratio(1)
 6.43  % 6.90  % 6.48  %
Credit Risk Profile:
Total nonperforming loans $ 29,267  $ 26,359  $ 14,442 
Nonperforming loans ratio 0.66  % 0.64  % 0.37  %
Total nonperforming assets $ 33,164  $ 30,288  $ 14,442 
Nonperforming assets ratio 0.49  % 0.47  % 0.23  %
Net charge-offs $ 189  $ 2,068  $ 333 
Net charge-off ratio 0.02  % 0.20  % 0.03  %
Allowance for credit losses $ 55,900  $ 51,500  $ 49,800 
Allowance for credit losses ratio 1.27  % 1.25  % 1.27  %
Allowance for credit losses to nonaccrual ratio 197.53  % 198.91  % 344.88  %
(1) Non-GAAP measure. See the Non-GAAP Measures section for a reconciliation to the most directly comparable GAAP measure.




12

MIDWESTONE FINANCIAL GROUP, INC.
AVERAGE BALANCE SHEET AND YIELD ANALYSIS
  Three Months Ended
  March 31, 2024 December 31, 2023 March 31, 2023
(Dollars in thousands) Average
Balance		 Interest
Income/
Expense		   Average
Yield/
Cost		  
Average
Balance
Interest
Income/
Expense
   Average
Yield/
Cost		 Average Balance Interest
Income/
Expense		   Average
Yield/
Cost
ASSETS      
Loans, including fees (1)(2)(3)
 $ 4,298,216  $ 58,867    5.51  %   $ 4,080,243  $ 54,939  5.34  % $ 3,867,110  $ 47,206    4.95  %
Taxable investment securities 1,557,603  9,460    2.44  %   1,593,699  9,274  2.31  % 1,811,388  10,444    2.34  %
Tax-exempt investment securities (2)(4)
 328,736  2,097    2.57  %   338,243  2,217  2.60  % 397,110  2,649    2.71  %
Total securities held for investment(2)
 1,886,339  11,557  2.46  % 1,931,942  11,491  2.36  % 2,208,498  13,093  2.40  %
Other 30,605  418    5.49  %   22,937  230  3.98  % 24,848  244    3.98  %
Total interest earning assets(2)
 $ 6,215,160  $ 70,842    4.58  %   $ 6,035,122  $ 66,660  4.38  % $ 6,100,456  $ 60,543    4.02  %
Other assets 420,219      424,583  423,609   
Total assets $ 6,635,379      $ 6,459,705  $ 6,524,065   
LIABILITIES AND SHAREHOLDERS’ EQUITY      
Interest checking deposits $ 1,301,470  $ 2,890  0.89  % $ 1,305,759  $ 2,991  0.91  % $ 1,515,845  $ 1,849  0.49  %
Money market deposits 1,102,543  8,065  2.94  % 1,103,637  7,954  2.86  % 930,543  3,269  1.42  %
Savings deposits 694,143  2,047    1.19  %   639,766  1,493  0.93  % 653,043  272    0.17  %
Time deposits 1,446,981  14,724    4.09  %   1,463,498  14,762  4.00  % 1,417,688  9,929    2.84  %
Total interest bearing deposits 4,545,137  27,726    2.45  %   4,512,660  27,200  2.39  % 4,517,119  15,319    1.38  %
Securities sold under agreements to repurchase 5,330  11  0.83  % 8,661  17  0.78  % 145,809  450  1.25  %
Other short-term borrowings 409,525  4,964  4.88  % 273,963  3,479  5.04  % 111,306  1,336  4.87  %
Short-term borrowings 414,855  4,975    4.82  %   282,624  3,496  4.91  % 257,115  1,786    2.82  %
Long-term debt 123,266  2,103    6.86  %   124,495  2,131  6.79  % 139,208  2,124    6.19  %
Total borrowed funds 538,121  7,078  5.29  % 407,119  5,627  5.48  % 396,323  3,910  4.00  %
Total interest bearing liabilities $ 5,083,258  $ 34,804    2.75  %   $ 4,919,779  $ 32,827  2.65  % $ 4,913,442  $ 19,229    1.59  %
Noninterest bearing deposits 935,977      930,663  1,029,575   
Other liabilities 88,611      98,027  82,501   
Shareholders’ equity 527,533  511,236  498,547 
Total liabilities and shareholders’ equity $ 6,635,379      $ 6,459,705  $ 6,524,065   
Net interest income(2)
 $ 36,038  $ 33,833  $ 41,314 
Net interest spread(2)
   1.83  %     1.73  %   2.43  %
Net interest margin(2)
 2.33  % 2.22  % 2.75  %
Total deposits(5)
 $ 5,481,114  $ 27,726  2.03  % $ 5,443,323  $ 27,200  1.98  % $ 5,546,694  $ 15,319  1.12  %
Cost of funds(6)
 2.33  % 2.23  % 1.31  %
(1) Average balance includes nonaccrual loans.
(2) Tax equivalent. The federal statutory tax rate utilized was 21%.
(3) Interest income includes net loan fees, loan purchase discount accretion and tax equivalent adjustments. Net loan fees were $237 thousand, $207 thousand, and $95 thousand for the three months ended March 31, 2024, December 31, 2023, and March 31, 2023, respectively. Loan purchase discount accretion was $1.2 million, $765 thousand, and $1.2 million for the three months ended March 31, 2024, December 31, 2023, and March 31, 2023, respectively. Tax equivalent adjustments were $920 thousand, $846 thousand, and $716 thousand for the three months ended March 31, 2024, December 31, 2023, and March 31, 2023, respectively. The federal statutory tax rate utilized was 21%.
(4) Interest income includes tax equivalent adjustments of $387 thousand, $428 thousand, and $522 thousand for the three months ended March 31, 2024, December 31, 2023, and March 31, 2023, respectively. The federal statutory tax rate utilized was 21%.
(5) Total deposits is the sum of total interest-bearing deposits and noninterest bearing deposits. The cost of total deposits is calculated as annualized interest expense on deposits divided by average total deposits.
(6) Cost of funds is calculated as annualized total interest expense divided by the sum of average total deposits and borrowed funds.









13

Non-GAAP Measures
This earnings release contains non-GAAP measures for tangible common equity, tangible book value per share, tangible common equity ratio, return on average tangible equity, net interest margin (tax equivalent), core net interest margin, loan yield (tax equivalent), core yield on loans, and efficiency ratio. Management believes these measures provide investors with useful information regarding the Company’s profitability, financial condition and capital adequacy, consistent with how management evaluates the Company’s financial performance. The following tables provide a reconciliation of each non-GAAP measure to the most comparable GAAP measure.
Tangible Common Equity/Tangible Book Value
per Share/Tangible Common Equity Ratio March 31, December 31, September 30, June 30, March 31,
(Dollars in thousands, except per share data) 2024 2023 2023 2023 2023
Total shareholders’ equity $ 528,040  $ 524,378  $ 505,411  $ 501,341  $ 500,650 
Intangible assets, net
 (100,649) (86,546) (87,987) (89,446) (91,040)
Tangible common equity $ 427,391  $ 437,832  $ 417,424  $ 411,895  $ 409,610 
Total assets $ 6,748,015  $ 6,427,540  $ 6,467,818  $ 6,521,489  $ 6,409,952 
Intangible assets, net
(100,649) (86,546) (87,987) (89,446) (91,040)
Tangible assets $ 6,647,366  $ 6,340,994  $ 6,379,831  $ 6,432,043  $ 6,318,912 
Book value per share $ 33.53  $ 33.41  $ 32.21  $ 31.96  $ 31.94 
Tangible book value per share(1)
 $ 27.14  $ 27.90  $ 26.60  $ 26.26  $ 26.13 
Shares outstanding 15,750,471  15,694,306  15,691,738  15,685,123  15,675,325 
Common equity ratio 7.83  % 8.16  % 7.81  % 7.69  % 7.81  %
Tangible common equity ratio(2)
 6.43  % 6.90  % 6.54  % 6.40  % 6.48  %
(1) Tangible common equity divided by shares outstanding.
(2) Tangible common equity divided by tangible assets.
Three Months Ended
Return on Average Tangible Equity March 31, December 31, March 31,
(Dollars in thousands) 2024 2023 2023
Net income $ 3,269  $ 2,730  $ 1,397 
Intangible amortization, net of tax(1)
 1,228  1,081  1,314 
Tangible net income $ 4,497  $ 3,811  $ 2,711 
Average shareholders’ equity $ 527,533  $ 511,236  $ 498,547 
Average intangible assets, net
(95,296) (87,258) (92,002)
Average tangible equity $ 432,237  $ 423,978  $ 406,545 
Return on average equity
 2.49  % 2.12  % 1.14  %
Return on average tangible equity(2)
 4.18  % 3.57  % 2.70  %
(1) The combined income tax rate utilized was 25%.
(2) Annualized tangible net income divided by average tangible equity.


14

Net Interest Margin, Tax Equivalent/
Core Net Interest Margin		 Three Months Ended
March 31, December 31, March 31,
(Dollars in thousands) 2024 2023 2023
Net interest income $ 34,731  $ 32,559  $ 40,076 
Tax equivalent adjustments:
Loans(1)
 920  846  716 
Securities(1)
 387  428  522 
Net interest income, tax equivalent $ 36,038  $ 33,833  $ 41,314 
Loan purchase discount accretion (1,152) (765) (1,189)
Core net interest income $ 34,886  $ 33,068  $ 40,125 
Net interest margin 2.25  % 2.14  % 2.66  %
Net interest margin, tax equivalent(2)
 2.33  % 2.22  % 2.75  %
Core net interest margin(3)
 2.26  % 2.17  % 2.67  %
Average interest earning assets $ 6,215,160  $ 6,035,122  $ 6,100,456 
(1) The federal statutory tax rate utilized was 21%.
(2) Annualized tax equivalent net interest income divided by average interest earning assets.
(3) Annualized core net interest income divided by average interest earning assets.
Three Months Ended
Loan Yield, Tax Equivalent / Core Yield on Loans March 31, December 31, March 31,
(Dollars in thousands) 2024 2023 2023
Loan interest income, including fees $ 57,947  $ 54,093  $ 46,490 
Tax equivalent adjustment(1)
 920  846  716 
Tax equivalent loan interest income $ 58,867  $ 54,939  $ 47,206 
Loan purchase discount accretion (1,152) (765) (1,189)
Core loan interest income $ 57,715  $ 54,174  $ 46,017 
Yield on loans 5.42  % 5.26  % 4.88  %
Yield on loans, tax equivalent(2)
 5.51  % 5.34  % 4.95  %
Core yield on loans(3)
 5.40  % 5.27  % 4.83  %
Average loans $ 4,298,216  $ 4,080,243  $ 3,867,110 
(1) The federal statutory tax rate utilized was 21%.
(2) Annualized tax equivalent loan interest income divided by average loans.
(3) Annualized core loan interest income divided by average loans.
Three Months Ended
Efficiency Ratio March 31, December 31, March 31,
(Dollars in thousands) 2024 2023 2023
Total noninterest expense $ 35,565  $ 32,131  $ 33,319 
Amortization of intangibles (1,637) (1,441) (1,752)
Merger-related expenses (1,314) (245) (136)
Noninterest expense used for efficiency ratio $ 32,614  $ 30,445  $ 31,431 
Net interest income, tax equivalent(1)
 $ 36,038  $ 33,833  $ 41,314 
Plus: Noninterest income 9,750  3,862  (4,046)
Less: Investment securities (losses) gains, net 36  (5,696) (13,170)
Net revenues used for efficiency ratio $ 45,752  $ 43,391  $ 50,438 
Efficiency ratio (2)
 71.28  % 70.16  % 62.32  %
(1) The federal statutory tax rate utilized was 21%.
(2) Noninterest expense adjusted for amortization of intangibles and merger-related expenses divided by the sum of tax equivalent net interest income, noninterest income and net investment securities gains.









15

Contact:
Charles N. Reeves Barry S. Ray
Chief Executive Officer Chief Financial Officer
319.356.5800 319.356.5800


16
EX-99.2 3 ex992q12024earningsrelea.htm EX-99.2 ex992q12024earningsrelea
First Quarter 2024 Earnings Conference Call April 26, 2024

 
2 Forward Looking Statements & Non-GAAP Measures This presentation 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 sale of our Florida branches and the recent 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 significant increases in inflation and interest rates since 2020, 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, including the 1.0% excise tax on stock buybacks by publicly traded companies and any changes in response to the recent 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 Israeli-Palestinian conflict 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 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. Non-GAAP Measures This presentation contains non-GAAP measures for tangible common equity, tangible book value per share, tangible common equity ratio, loan yield, tax equivalent, efficiency ratio, pre-tax, pre-provision earnings, return on average tangible equity, and net interest margin, tax equivalent. Management believes these measures provide investors with useful information regarding the Company’s profitability, financial condition and capital adequacy, consistent with how management evaluates the Company’s financial performance. A reconciliation of each non-GAAP measure to the most comparable GAAP measure is included, as necessary, in the Non-GAAP Financial Measures section.

 
3 Financial Highlights Total assets $ 6,748.0 4.99 % 5.27 % Total loans held for investment, net 4,414.6 6.97 12.64 Total deposits 5,585.2 3.51 0.54 Balance Sheet Equity to assets ratio 7.83 % (33) bps 2 bps Tangible common equity ratio (non-GAAP) 6.43 (47) (5) CET1 risk-based capital ratio 8.98 (61) (41) Total risk-based capital ratio 11.97 (56) (34) Loans to deposits ratio 79.04 % 255 849 Capital and Liquidity Net interest margin, tax equivalent (non-GAAP) 2.33 % 11 bps (42) bps Cost of total deposits 2.03 5 91 Return on average assets 0.20 3 11 Return on average tangible equity (non-GAAP) 4.18 61 148 Efficiency ratio (non-GAAP) 71.28 112 896 Profitability Nonperforming loans ratio 0.66 % 2 bps 29 bps Nonperforming assets ratio 0.49 2 26 Net charge-off ratio 0.02 (18) (1) Allowance for credit losses ratio 1.27 2 0 Credit Risk Profile 1Q24 Financial Highlights – See the section "Non-GAAP Financial measures." – Note: Financial metrics as of or for the quarter ended March 31, 2024. Change vs. Dollars in millions 1Q24 4Q23 1Q23

 
4 Denver Bankshares, Inc. Acquisition Deposit Market Share Rank 19 Banking Offices 2 Deposit Market Share 0.62% Median HHI $96,990 2023 - 2028 Projected HHI Change 15.91% 2023 - 2028 Projected Pop. Growth 4.65% February 2024 Unemployment Rate 4.2% Source: S&P Capital IQ (Deposit Market Share (June 2023), Median HHI, 2023 - 2028 Projected HHI, and 2023-2028 Projected Population Growth) Source: U.S. Bureau of Labor Statistics (February 2024 Unemployment Rate). *Deposit market share data per FDIC as of June 30, 2023. **Banking office information is as of 3/31/24. Dollars are reported in millions. Note: Core market information excludes Florida banking offices, gross loans, and deposits, in addition to brokered time deposits of $205.0 million. Merger Update • On January 31, 2024, MidWestOne Financial Group, Inc. ("MOFG," or "MidWestOne") acquired Denver Bankshares, Inc. ("DNVB"), a bank holding company for the Bank of Denver. • As consideration for the merger, we paid cash in the amount of $32.6 million. • During the first quarter of 2024, the core banking system conversion was completed. In addition, we closed and consolidated the operations of a MidWestOne banking office located in Denver, Colorado into the former Bank of Denver banking office. Denver Demographics and MOFG Market Share* MOFG Core Markets (After Acquisition)** Assets Acquired and Liabilities Assumed In thousands January 31, 2024 Identifiable net assets acquired, at fair value Assets acquired: Cash and due from banks $ 462 Interest earning deposits in banks 3,517 Debt securities 52,493 Loans held for investment 207,095 Premises and equipment 13,470 Core deposit intangible 7,100 Other assets 4,987 Total assets acquired $ 289,124 Liabilities assumed: Deposits (224,248) Short-term borrowings (37,500) Other liabilities (3,417) Total liabilities assumed $ (265,165) Identifiable net assets acquired, at fair value $ 23,959 State Banking Offices Total Gross Loans in Market Total Deposits in Market Iowa Community 22 $ 846.4 $ 1,753.3 Iowa Metro 17 1,495.1 1,832.8 Twin Cities 15 1,256.0 1,220.8 Denver 2 673.4 428.6

 
5 MOFG's Five Strategic Pillars to Deliver Improved Results Exceptional Customer and Employee Engagement 1 Enhance MOFG's award winning culture with a continued focus on performance and financial results 2 Protect and enhance MOFG's dominant community bank franchise through product expansion 3 Continue to hire exceptional relationship bankers and wealth management professionals 4 Develop specialty commercial banking verticals by continuing to attract experienced professionals 5 Continue to identify and execute on opportunities for efficiency gains and cost reduction Strong Core Local Banking Model Sophisticated Commercial Banking and Wealth Management Specialty Business Lines Improving our Efficiency and Operations

 
6 Strategic Plan Updates The sale of MOFG's Florida operations is on-track for an expected closed in 2Q 2024. Loan growth (excluding acquired DNVB loan balances) of 8%. Completed the acquisition of DNVB on January 31, 2024, the conversion of core banking system, and the consolidation of the legacy MidWestOne Denver banking office into a former Bank of Denver banking office. Continued momentum in Wealth Management, with linked quarter revenue growth of 10%, and recruited seasoned, new EVP, Head of Wealth Management. Senior level hires in Credit Administration, Commercial Banking, Wealth Management and Marketing.

 
7 Commercial Loan Portfolio Commercial and Industrial, 30% Agricultural, 3% Farmland, 5% Construction & Development, 11% Multifamily, 11% CRE-Other, 40% Commercial Loan Portfolio Mix - March 31, 2024 Commercial Loan Portfolio of $3.7 billion Commercial Loan Growth in Targeted Regions $ in Millions $865.4 $1,075.7 $883.5 $1,083.4 Iowa Metro Twin Cities 03/31/22 03/31/23 03/31/24 $247.8 $612.5 Denver 03/31/22 03/31/23 03/31/24 11% CAGR 11% CAGR

 
8 Credit $ m illi on s Nonperforming Assets $14.4 $14.4 $29.0 $30.3 $33.2 3/31/2023 6/30/2023 9/30/2023 12/31/2023 3/31/2024 $ m illi on s Net Charge-Offs $0.3 $0.9 $0.5 $2.1 $0.2 1Q23 2Q23 3Q23 4Q23 1Q24 Credit Quality Measures $ millions 1Q23 2Q23 3Q23 4Q23 1Q24 Nonperforming assets ratio 0.23 % 0.22 % 0.45 % 0.47 % 0.49 % Net charge-off ratio 0.03 % 0.09 % 0.04 % 0.20 % 0.02 % Loans greater than 30 days past due and accruing $4.9 $6.2 $6.4 $10.8 $8.8 Allowance for credit losses ratio 1.27 % 1.25 % 1.27 % 1.25 % 1.27 % (1) Nonperforming assets in the third quarter of 2023 increased primarily due to a single commercial relationship. (1)

 
9 Commercial Real Estate 3.8% 96.2% NOO CRE Office All Other Loans Non-Owner Occupied CRE Office March 31, 2024 $ millions 1Q24 Construction & Development $ 403.6 Farmland 184.1 Multifamily 409.5 CRE Other: NOO CRE Office 166.1 OO CRE Office 91.3 Industrial and Warehouse 429.1 Retail 285.0 Hotel 126.2 Other 342.9 Total Commercial Real Estate $ 2,437.8 Commercial Real Estate Portfolio(2) March 31, 2024 Portfolio Highlights March 31, 2024 $ millions Average NOO CRE Office outstanding principal $ 1.3 Commercial Real Estate Concentration: % of Total Capital Regulatory Threshold Construction, land development and other land 60 % 100 % Total CRE loans(1) 251 % 300 % (1)Total CRE loans includes construction, land development and other land, in addition to multifamily and NOO CRE. (2) Represents the amortized cost of the CRE portfolio.

 
10 Focusing on Growth in Wealth Management $2.44 $2.74 $2.73 $3.01 $3.10 2020 2021 2022 2023 1Q24 $— $1.00 $2.00 $3.00 $4.00 Investment Services and Trust Activity Revenue • Asset amounts presented are in billions of dollars • Revenue amounts presented are in millions of dollars $9.6 $11.7 $11.2 $12.2 $3.5 $3.2 $4.2 $3.9 $3.8 $1.2 $6.4 $7.5 $7.3 $8.4 $2.3 Investment Services Trust 2020 2021 2022 2023 1Q24 $5.0 $10.0 $15.0 Wealth Management Assets Under Administration • Hired a new Head of Wealth Management, with deep expertise in investment strategies and relationship management • Built momentum in the Twin Cities with a talented Wealth Management team focused on leveraging strong relationships with our Retail and Commercial colleagues • Strengthened Wealth Management capabilities with the addition of an experienced team in Eastern Iowa that collectively has more than 120 years of experience • Expanded our presence to a new office in Cedar Rapids, Iowa, a targeted metropolitan market • Invested in financial technology that will improve the customer experience and streamline internal processes

 
11 Financial Performance

 
12 Balance Sheet 1Q24 vs. 4Q23 1Q24 vs. 1Q23 Period end balances, $ millions 1Q24 $ Change % Change $ Change % Change Loans $4,414.6 $287.7 7 % $495.2 13 % Investment securities $1,862.2 $(8.1) — % $(209.6) (10) % Interest earning deposits in banks $29.3 $23.8 433 % $24.0 453 % Deposits $5,585.2 $189.5 4 % $30.0 1 % Borrowed funds $545.1 $121.5 29 % $263.1 93 % Shareholders' equity $528.0 $3.6 1 % $27.3 5 % 1Q24 1Q24 Period end 1Q24 4Q23 vs. 4Q23 1Q23 vs. 1Q23 Tangible book value per share (non-GAAP) $27.14 $27.90 (3) % $26.13 4 % Common equity Tier 1 capital ratio 9.0 % 9.6 % (60) bps 9.4 % (40) bps AOCI $(60.8) $(64.9) 6 % $(78.9) 23 % Return on average tangible equity (non-GAAP) 4.18 % 3.57 % 61 bps 2.70 % 148 bps – See the section "Non-GAAP Financial Measures."

 
13 Balance Sheet- Average Loans and Deposits – IB Deposits represent interest bearing deposits and NIB Deposits represent noninterest bearing deposits. – Loan yield, tax equivalent is a non-GAAP measure. See the Section "Non-GAAP Financial Measures." Av er ag e ba la nc es , $ bi lli on s Average Deposits $5.55 $5.44 $5.48 $4.52 $4.51 $4.55 $1.03 $0.93 $0.94 1.38% 2.39% 2.45% IB Deposits NIB Deposits Cost of IB Deposits 1Q23 4Q23 1Q24 Av er ag e ba la nc es , $ bi lli on s Average Loans $3.87 $4.08 $4.30 4.95% 5.34% 5.51% Loans Loan yield, tax equivalent 1Q23 4Q23 1Q24

 
14 Balance Sheet - Debt Securities Portfolio Municipals, 15% MBS, 1% CLO, 8% CMO, 22% Corporate, 54% 2.40% 2.35% 2.36% 2.36% 2.46% Total Securities Held for Investment (FTE) 1Q23 2Q23 3Q23 4Q23 1Q24 Investment Securities Yield Available for Sale Debt Securities Portfolio Mix March 31, 2024(1) Municipals, 50% MBS, 7% CMO, 43% Held to Maturity Debt Securities Portfolio Mix March 31, 2024(1) • Investment Portfolio Mix: ◦ AFS Securities - $0.8 billion ◦ HTM Securities - $1.1 billion • Investment Portfolio Duration (Years): ◦ AFS Securities - 2.8 ◦ HTM Securities - 6.2 ◦ Total Securities - 4.8 • Allowance for credit losses for investments is $0 Portfolio Composition (1) Percentages may not total 100% due to rounding.

 
15 Income Statement % Change 1Q24 vs. $ millions 1Q24 4Q23 1Q23 4Q23 1Q23 Net interest income $34.7 $32.6 $40.1 6 % (13) % Noninterest income 9.8 3.9 (4.0) 151 % n/m Total revenue 44.5 36.5 36.1 22 % 23 % Noninterest expense 35.6 32.1 33.3 11 % 7 % Pre-tax, pre-provision earnings (non-GAAP) $8.9 $4.4 $2.8 102 % 218 % Credit loss expense $4.7 $1.8 $0.9 161 % 422 % Income tax expense (benefit) $1.0 $(0.2) $0.4 n/m 150 % Net income $3.3 $2.7 $1.4 22 % 136 % 1Q24 1Q24 1Q24 4Q23 1Q23 vs. 4Q23 vs. 1Q23 Net interest margin (non-GAAP) 2.33 % 2.22 % 2.75 % 11 bps (42) bps Efficiency ratio (non-GAAP) 71.28 % 70.16 % 62.32 % (112) bps (896) bps Diluted EPS $0.21 $0.17 $0.09 24 % 133 % Results are not meaningful (n/m) – See the section "Non-GAAP Financial Measures."

 
16 Non-GAAP Financial Measures

 
17 Non-GAAP Financial Measures Tangible Common Equity / Tangible Book Value per Share / Tangible Common Equity Ratio March 31, 2023 December 31, 2023 March 31, 2024 dollars in thousands Total shareholders' equity $ 500,650 $ 524,378 $ 528,040 Intangible assets, net (91,040) (86,546) (100,649) Tangible common equity $ 409,610 $ 437,832 $ 427,391 Total assets $ 6,409,952 $ 6,427,540 $ 6,748,015 Intangible assets, net (91,040) (86,546) (100,649) Tangible assets $ 6,318,912 $ 6,340,994 $ 6,647,366 Book value per share $ 31.94 $ 33.41 $ 33.53 Tangible book value per share (1) $ 26.13 $ 27.90 $ 27.14 Shares outstanding 15,675,325 15,694,306 15,750,471 Tangible common equity ratio (2) 6.48 % 6.90 % 6.43 % (1) Tangible common equity divided by shares outstanding. (2) Tangible common equity divided by tangible assets. Loan Yield, Tax Equivalent For the Three Months Ended March 31, 2023 December 31, 2023 March 31, 2024 dollars in thousands Loan interest income, including fees $ 46,490 $ 54,093 $ 57,947 Tax equivalent adjustment (1) 716 846 920 Tax equivalent loan interest income $ 47,206 $ 54,939 $ 58,867 Yield on loans, tax equivalent (2) 4.95 % 5.34 % 5.51 % Average Loans $ 3,867,110 $ 4,080,243 $ 4,298,216 (1) The federal statutory tax rate utilized was 21%. (2) Annualized tax equivalent loan interest income divided by average loans.

 
18 Non-GAAP Financial Measures Efficiency Ratio For the Three Months Ended March 31, 2023 December 31, 2023 March 31, 2024 dollars in thousands Total noninterest expense $ 33,319 $ 32,131 $ 35,565 Amortization of intangibles (1,752) (1,441) (1,637) Merger-related expenses (136) (245) (1,314) Noninterest expense used for efficiency ratio $ 31,431 $ 30,445 $ 32,614 Net interest income, tax equivalent (1) $ 41,314 $ 33,833 $ 36,038 Noninterest income (4,046) 3,862 9,750 Investment securities (losses) gains, net (13,170) (5,696) 36 Net revenues used for efficiency ratio $ 50,438 $ 43,391 $ 45,752 Efficiency ratio 62.32 % 70.16 % 71.28 % (1) The federal statutory tax rate utilized was 21%. (2) Noninterest expense adjusted for amortization of intangibles and merger-related expenses divided by the sum of tax equivalent net interest income, noninterest income and net investment securities (losses) gains. Pre-tax / Pre-provision Net Revenue For the Three Months Ended March 31, 2023 December 31, 2023 March 31, 2024 dollars in thousands Net interest income $ 40,076 $ 32,559 $ 34,731 Noninterest income (4,046) 3,862 9,750 Noninterest expense (33,319) (32,131) (35,565) Pre-tax / Pre-provision Net Revenue $ 2,711 $ 4,290 $ 8,916

 
19 Non-GAAP Financial Measures Return on Average Tangible Equity For the Three Months Ended March 31, 2023 December 31, 2023 March 31, 2024 dollars in thousands Net income $ 1,397 $ 2,730 $ 3,269 Intangible amortization, net of tax (1) 1,314 1,081 1,228 Tangible net income $ 2,711 $ 3,811 $ 4,497 Average shareholders' equity $ 498,547 $ 511,236 $ 527,533 Average intangible assets, net (92,002) (87,258) (95,296) Average tangible equity $ 406,545 $ 423,978 $ 432,237 Return on average equity 1.14 % 2.12 % 2.49 % Return on average tangible equity (2) 2.70 % 3.57 % 4.18 % (1) The combined income tax rate utilized was 25%. (2) Annualized tangible net income divided by average tangible equity. Net Interest Margin, Tax Equivalent For the Three Months Ended March 31, 2023 December 31, 2023 March 31, 2024 dollars in thousands Net interest Income $ 40,076 $ 32,559 $ 34,731 Tax equivalent adjustments: Loans (1) 716 846 920 Securities (1) 522 428 387 Net Interest Income, tax equivalent $ 41,314 $ 33,833 $ 36,038 Average interest earning assets $ 6,100,456 $ 6,035,122 $ 6,215,160 Net interest margin, tax equivalent (2) 2.75 % 2.22 % 2.33 % (1) The federal statutory tax rate utilized was 21%. (2) Annualized tax equivalent net interest income divided by average interest earning assets.