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Why Middlefield Banc (MBCN) Might be Well Poised for a Surge
ZACKS· 2025-08-25 17:20
Middlefield Banc Corp. (MBCN) could be a solid addition to your portfolio given a notable revision in the company's earnings estimates. While the stock has been gaining lately, the trend might continue since its earnings outlook is still improving.Analysts' growing optimism on the earnings prospects of this company is driving estimates higher, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term st ...
Middlefield Banc (MBCN) Moves 15.4% Higher: Will This Strength Last?
ZACKS· 2025-08-25 14:01
Middlefield Banc Corp. (MBCN) shares ended the last trading session 15.4% higher at $33.35. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 4.5% loss over the past four weeks.On Friday, during his speech at Jackson Hole, Federal Reserve Chair Jerome Powell signaled that a rate cut could come as early as September, citing rising risks in the labor market and easing inflation pressures. This marks a shift from the Fe ...
Middlefield Banc(MBCN) - 2025 Q2 - Quarterly Report
2025-08-12 20:12
[Part I – Financial Information](index=3&type=section&id=Part%201%20%E2%80%93%20Financial%20Information) This section presents the unaudited financial information for the company, including detailed financial statements and management's discussion and analysis [Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20%28unaudited%29) Unaudited financial statements for Q2 and 6M 2025 show increased assets, net income, and equity, driven by loan growth and net interest income [Consolidated Balance Sheet](index=4&type=section&id=Consolidated%20Balance%20Sheet) Total assets grew to $1.92 billion by June 30, 2025, fueled by loan and deposit increases, with stockholders' equity also rising Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $72,846 | $55,792 | | Net loans | $1,559,590 | $1,497,167 | | Total Assets | $1,924,369 | $1,853,359 | | **Liabilities & Equity** | | | | Total deposits | $1,593,618 | $1,445,693 | | Federal Home Loan Bank advances | $89,000 | $172,400 | | Total Liabilities | $1,708,317 | $1,642,797 | | Total Stockholders' Equity | $216,052 | $210,562 | [Consolidated Statement of Income](index=5&type=section&id=Consolidated%20Statement%20of%20Income) Net income significantly increased for both Q2 and the first six months of 2025, driven by higher net interest income and a real estate gain Key Income Statement Data (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Interest Income | $17,437 | $15,083 | $33,535 | $30,052 | | Provision for (Recovery of) Credit Losses | ($506) | $87 | ($411) | ($49) | | Noninterest Income | $3,078 | $1,760 | $5,022 | $3,556 | | Noninterest Expense | $13,651 | $11,902 | $25,844 | $23,867 | | **Net Income** | **$6,157** | **$4,164** | **$10,987** | **$8,331** | | **Diluted EPS** | **$0.76** | **$0.52** | **$1.36** | **$1.03** | [Consolidated Statement of Comprehensive Income (Loss)](index=7&type=section&id=Consolidated%20Statement%20of%20Comprehensive%20Income%20%28Loss%29) Comprehensive income for Q2 and 6M 2025 was lower than net income due to unrealized losses on available-for-sale securities Comprehensive Income (Loss) Summary (in thousands) | Metric | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Income | $6,157 | $4,164 | $10,987 | $8,331 | | Other Comprehensive Loss (net of tax) | ($2,497) | ($1,338) | ($2,864) | ($3,378) | | **Comprehensive Income (Loss)** | **$3,660** | **$2,826** | **$8,123** | **$4,953** | [Consolidated Statement of Changes in Stockholders' Equity](index=8&type=section&id=Consolidated%20Statement%20of%20Changes%20in%20Stockholders%27%20Equity) Stockholders' equity increased by June 30, 2025, primarily due to net income, despite offsetting dividends and comprehensive losses - For the six months ended June 30, 2025, total stockholders' equity increased by **$5.5 million**, reflecting the balance of net income, dividends, stock grants, and other comprehensive losses[22](index=22&type=chunk) [Consolidated Statement of Cash Flows](index=10&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) Cash and cash equivalents increased for the six months ended June 30, 2025, driven by operating and financing activities, offset by investing Summary of Cash Flows (in thousands) | Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $12,846 | $8,803 | | Net Cash used in Investing Activities | ($56,820) | ($17,942) | | Net Cash from Financing Activities | $61,028 | $561 | | **Net Increase (Decrease) in Cash** | **$17,054** | **($8,578)** | [Notes to Unaudited Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Financial%20Statements) Notes detail accounting policies, loan portfolio growth to $1.58 billion, decreased nonperforming loans, and a settled cyber-attack lawsuit covered by insurance - The total loan portfolio grew to **$1.58 billion** as of June 30, 2025, up from **$1.52 billion** at the end of 2024[66](index=66&type=chunk) - The Allowance for Credit Losses (ACL) on loans decreased slightly to **$22.3 million** at June 30, 2025, from **$22.4 million** at December 31, 2024, driven by portfolio activity, updated assumptions, and the economic outlook[72](index=72&type=chunk) - Nonperforming loans totaled **$25.1 million** as of June 30, 2025, a decrease from **$30.0 million** at December 31, 2024[87](index=87&type=chunk)[146](index=146&type=chunk) - A class action lawsuit related to an April 2023 cyber-attack was settled, with payments issued on May 15, 2025, and losses, including attorney fees and settlement costs, were within the coverage limits of the company's **$3 million** cyber risk insurance policy[103](index=103&type=chunk) [Management's Discussion and Analysis (MD&A)](index=40&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes strong H1 2025 performance to expanded net interest margin, asset growth, improved asset quality, and robust liquidity and capital [Financial Condition](index=45&type=section&id=Financial%20Condition) Total assets grew to $1.92 billion in H1 2025, driven by loan and deposit increases, while FHLB advances decreased and equity rose Loan Portfolio Changes (in thousands) | Loan Category | June 30, 2025 | Dec 31, 2024 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Commercial and industrial | $257,519 | $229,034 | $28,485 | 12.44% | | Construction and other | $123,531 | $103,608 | $19,923 | 19.23% | | Home equity lines of credit | $156,297 | $143,379 | $12,918 | 9.01% | | **Total loans** | **$1,581,925** | **$1,519,614** | **$62,311** | **4.10%** | Deposit Portfolio Changes (in thousands) | Deposit Category | June 30, 2025 | Dec 31, 2024 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Time Deposits | $334,755 | $247,704 | $87,051 | 35.14% | | Money market | $466,935 | $414,074 | $52,861 | 12.77% | | Interest-bearing demand | $236,239 | $208,291 | $27,948 | 13.42% | | **Total deposits** | **$1,593,618** | **$1,445,693** | **$147,925** | **10.23%** | - The company does not have a concentration in commercial real estate lending as of June 30, 2025, based on regulatory guidance, with commercial real estate loans representing **277.3%** of total risk-based capital, below the **300%** threshold that would trigger heightened scrutiny[135](index=135&type=chunk) [Results of Operations](index=52&type=section&id=Results%20of%20Operations) Net income significantly increased for Q2 and H1 2025, driven by higher net interest income and noninterest income, despite increased noninterest expenses - Net interest margin for the six months ended June 30, 2025, increased by **26 basis points** to **3.79%** compared to the same period in 2024, attributed to higher loan balances and lower costs on borrowings[157](index=157&type=chunk) - Noninterest income for the first six months of 2025 increased by **$1.5 million (41.2%)** year-over-year, primarily due to a **$1.2 million** gain on a real estate exchange and a **$633,000** bank-owned life insurance death benefit[167](index=167&type=chunk) - Noninterest expense for the first six months of 2025 rose by **$2.0 million (8.3%)** year-over-year, mainly due to an **$847,000** increase in salaries and a **$700,000** loss on a property recorded as held for sale[169](index=169&type=chunk) [Liquidity and Capital Resources](index=59&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity and capital, with substantial borrowing capacity and all regulatory capital ratios exceeding 'well-capitalized' standards - At June 30, 2025, the company had additional borrowing capacity of **$389.7 million** at the FHLB and **$149.5 million** at the Federal Reserve discount window[185](index=185&type=chunk) Regulatory Capital Ratios (Middlefield Banc Corp.) | Ratio | As of June 30, 2025 | Well-Capitalized Minimum (Bank only) | | :--- | :--- | :--- | | Leverage | 11.03% | 5.00% | | Common Equity Tier 1 | 11.72% | 6.50% | | Tier 1 Risk Based | 12.20% | 8.00% | | Total Risk Based | 13.45% | 10.00% | [Quantitative and Qualitative Disclosures about Market Risk](index=61&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company manages interest rate risk, with simulations showing limited impact on net interest income from rate changes within tolerance limits Interest Rate Sensitivity Analysis (June 30, 2025) | Change in Rates | % Change in Net Interest Income (NII) | % Change in Economic Value of Equity (EVE) | | :--- | :--- | :--- | | +200bp | (1.80%) | (2.40%) | | -100bp | 0.90% | (0.60%) | [Controls and Procedures](index=63&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective, with no material changes to internal control over financial reporting - The Chief Executive Officer and Chief Financial Officer have concluded that the Company's disclosure controls and procedures are effective[206](index=206&type=chunk) - No changes occurred in the Company's internal control over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, these controls[208](index=208&type=chunk) [Part II – Other Information](index=63&type=section&id=PART%20II%20%E2%80%93%20Other%20Information) This section provides additional disclosures including legal proceedings, risk factors, share repurchases, and other miscellaneous information [Legal Proceedings](index=63&type=section&id=Item%201.%20Legal%20Proceedings) A 2023 cyber-attack lawsuit was settled with costs covered by insurance, and no other legal proceedings are deemed material - A lawsuit related to a 2023 cyber-attack has been settled, and the costs associated with the lawsuit were paid by the insurance company in accordance with the policy[103](index=103&type=chunk)[209](index=209&type=chunk) [Risk Factors](index=63&type=section&id=Item%201a.%20Risk%20Factors) No material updates or changes to the company's risk factors have occurred since the December 31, 2024, Form 10-K report - No material updates or changes in risks faced by the Company have occurred since December 31, 2024[210](index=210&type=chunk) [Share Repurchases](index=63&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No common shares were repurchased during Q2 2025, with 250,052 shares remaining available under the authorized program - No shares were repurchased during the three months ended June 30, 2025, and the maximum number of shares that may yet be purchased under the program is **250,052**[211](index=211&type=chunk) [Other Disclosures and Exhibits](index=64&type=section&id=Item%203%2C%204%2C%205%20%26%206) The company reported no defaults on senior securities, no new director/officer trading plans, and included a list of exhibits - The company reports no defaults on senior securities and no new Rule 10b5-1 trading plans adopted by directors or officers in the quarter[213](index=213&type=chunk)
Middlefield Banc Corp. Announces 2025 Third-Quarter Cash Dividend Payment
Globenewswire· 2025-08-11 20:30
Group 1 - Middlefield Banc Corp. declared a quarterly cash dividend of $0.21 per common share, payable on September 12, 2025, to shareholders of record on August 29, 2025 [1] - The company has total assets of $1.92 billion as of June 30, 2025 [2] - Middlefield Banc Corp. operates 21 full-service banking centers and a brokerage office, serving multiple locations in Ohio [2] Group 2 - The company is headquartered in Middlefield, Ohio, and is the bank holding company of The Middlefield Banking Company [2] - Additional information about the company can be found on its website [3] - The press release includes forward-looking statements that may involve risks and uncertainties affecting the banking industry and the company's financial operations [3]
Middlefield Banc (MBCN) Q2 Earnings: Taking a Look at Key Metrics Versus Estimates
ZACKS· 2025-07-23 14:31
Core Insights - Middlefield Banc Corp. (MBCN) reported a revenue of $20.52 million for the quarter ended June 2025, reflecting a year-over-year increase of 21.8% [1] - The earnings per share (EPS) for the same quarter was $0.76, up from $0.52 in the previous year [1] - The reported revenue exceeded the Zacks Consensus Estimate by 10.3%, while the EPS surprise was 33.33% above the consensus estimate [1] Financial Performance Metrics - The efficiency ratio was reported at 64.5%, better than the average estimate of 67.5% from two analysts [4] - The net interest margin stood at 3.9%, surpassing the average estimate of 3.7% [4] - Average interest-earning assets were $1.83 billion, slightly above the estimated $1.8 billion [4] - Total noninterest income was $3.08 million, significantly higher than the estimated $1.85 million [4] - Net interest income reached $17.44 million, exceeding the average estimate of $16.75 million [4] Stock Performance - Over the past month, shares of Middlefield Banc have returned +0.9%, compared to a +5.9% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market [3]
Middlefield Banc Corp. (MBCN) Tops Q2 Earnings and Revenue Estimates
ZACKS· 2025-07-22 22:36
Core Viewpoint - Middlefield Banc Corp. reported quarterly earnings of $0.76 per share, exceeding the Zacks Consensus Estimate of $0.57 per share, and showing an increase from $0.52 per share a year ago, representing an earnings surprise of +33.33% [1] Financial Performance - The company posted revenues of $20.52 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 10.30%, compared to $16.84 million in the same quarter last year [2] - Over the last four quarters, Middlefield Banc has exceeded consensus EPS estimates three times and topped consensus revenue estimates three times [2] Stock Performance - Middlefield Banc shares have increased approximately 6.4% since the beginning of the year, while the S&P 500 has gained 7.2% [3] - The current Zacks Rank for Middlefield Banc is 3 (Hold), indicating expected performance in line with the market in the near future [6] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $0.55 on revenues of $18.65 million, and for the current fiscal year, it is $2.24 on revenues of $73.45 million [7] - The outlook for the industry, particularly the Banks - Northeast sector, is favorable, currently ranking in the top 30% of over 250 Zacks industries [8]
Middlefield Banc(MBCN) - 2025 Q2 - Quarterly Results
2025-07-22 20:07
[Financial Highlights](index=1&type=section&id=2025%20Second-Quarter%20Financial%20Highlights) Middlefield Banc Corp. reported strong Q2 2025 results, with diluted EPS up 46.2% and record total loans of $1.58 billion | Metric | Q2 2025 vs Q2 2024 | Value | | :--- | :--- | :--- | | Earnings per share (diluted) | Increased 46.2% | $0.76 | | Net Interest Margin | Expanded 37 bps | 3.88% | | Total Loans | Increased 5.6% | $1.58 billion | | Total Assets | Increased 5.3% | $1.92 billion | | Book Value per Share | Increased 4.3% | $26.74 | | Tangible Book Value per Share | Increased 6.1% | $21.60 | | Nonperforming assets to total assets | Decreased 32 bps (from Q4 2024) | 1.30% | - Net income for the quarter was boosted by a **$1.2 million** net gain on the exchange of real estate associated with the relocation of the Westerville, Ohio branch[3](index=3&type=chunk) - The company's strategy includes investing in its technology infrastructure, hiring experienced commercial bankers, and expanding its presence across Ohio markets[5](index=5&type=chunk) [Income Statement Analysis](index=2&type=section&id=Income%20Statement) Q2 2025 net interest income rose 15.6% to $17.4 million, with net income increasing 47.6% to $6.2 million | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Net Interest Income | $17.4 million | $15.1 million | +15.6% | | Net Interest Margin | 3.88% | 3.51% | +37 bps | | Net Income | $6.2 million | $4.2 million | +47.6% | | Diluted EPS | $0.76 | $0.52 | +46.2% | | Metric | Six Months 2025 | Six Months 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Net Interest Income | $33.5 million | $30.1 million | +11.6% | | Net Interest Margin | 3.79% | 3.53% | +26 bps | | Net Income | $11.0 million | $8.3 million | +32.5% | | Diluted EPS | $1.36 | $1.03 | +32.0% | - Noninterest income for Q2 2025 included a one-time, non-cash gain of **$1.2 million** from an exchange of real estate with the City of Westerville, Ohio[7](index=7&type=chunk) - Noninterest expense for Q2 2025 included a **$700,000** loss associated with recording a separate property in Westerville as held for sale[8](index=8&type=chunk) [Balance Sheet Analysis](index=2&type=section&id=Balance%20Sheet) As of June 30, 2025, total assets reached a record $1.92 billion and total loans $1.58 billion, driven by broad-based growth | Balance Sheet Item | June 30, 2025 | June 30, 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Total Assets | $1.92 billion | $1.83 billion | +5.3% | | Total Loans | $1.58 billion | $1.50 billion | +5.6% | | Total Deposits | $1.59 billion | $1.47 billion | +8.4% | | Total Liabilities | $1.71 billion | $1.62 billion | +5.4% | - The increase in total loans was primarily due to higher home equity lines of credit, commercial and industrial loans, and various real estate loan categories[10](index=10&type=chunk) - Deposit growth was mainly from money market and interest-bearing demand accounts, with brokered deposits increasing to **$165.1 million** from **$86.5 million** a year ago[12](index=12&type=chunk) - The Commercial Real Estate (CRE) portfolio totaled **$681.2 million**, with non-owner occupied properties making up the largest portion at **59.6%** of the CRE portfolio[13](index=13&type=chunk) [Stockholders' Equity and Dividends](index=3&type=section&id=Stockholders%27%20Equity%20and%20Dividends) Stockholders' equity increased 4.5% to $216.1 million, and the quarterly cash dividend rose 5% to $0.21 per share | Equity Metric | June 30, 2025 | June 30, 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Stockholders' Equity | $216.1 million | $206.8 million | +4.5% | | Book Value per Share | $26.74 | $25.63 | +4.3% | | Tangible Stockholders' Equity | $174.6 million | $164.3 million | +6.3% | | Tangible Book Value per Share | $21.60 | $20.37 | +6.0% | - The company increased its quarterly cash dividend by **$0.01**, or **5%**, to **$0.21** per share beginning in Q1 2025[16](index=16&type=chunk) - No shares of common stock were repurchased during the six months ended June 30, 2025[17](index=17&type=chunk) [Asset Quality](index=3&type=section&id=Asset%20Quality) Asset quality improved in H1 2025, with nonperforming assets to total assets decreasing to 1.30% due to loan payoffs | Asset Quality Metric | June 30, 2025 | Dec 31, 2024 | March 31, 2025 | | :--- | :--- | :--- | :--- | | Nonperforming assets to total assets | 1.30% | 1.62% | 1.56% | - Non-performing assets declined by **$4.9 million** since December 31, 2024, primarily due to the payoff of one previously disclosed non-accruing loan[21](index=21&type=chunk) - The year-over-year increase in nonperforming loans to **$25.1 million** was primarily due to a **$12.0 million** loan that was moved to nonaccrual status in the third quarter of 2024[20](index=20&type=chunk) - The allowance for credit losses was **$22.3 million**, or **1.41%** of total loans, at June 30, 2025[20](index=20&type=chunk) [Consolidated Financial Data](index=5&type=section&id=Consolidated%20Financial%20Data) This section provides detailed consolidated financial tables, including balance sheets, income statements, and key ratios Consolidated Balance Sheet Highlights (as of June 30, 2025) | Account | Amount (in thousands) | | :--- | :--- | | Total Assets | $1,924,369 | | Total Loans | $1,581,925 | | Allowance for credit losses | $22,335 | | Total Deposits | $1,593,618 | | Total Stockholders' Equity | $216,052 | Consolidated Income Statement Highlights (For the Three Months Ended June 30, 2025) | Account | Amount (in thousands) | | :--- | :--- | | Net Interest Income | $17,437 | | Provision for (recovery of) credit losses | $(506) | | Noninterest Income | $3,078 | | Noninterest Expense | $13,651 | | Net Income | $6,157 | Key Ratios and Per Share Data (For the Three Months Ended June 30, 2025) | Metric | Value | | :--- | :--- | | Net income per common share - diluted | $0.76 | | Book value per share | $26.74 | | Return on average assets (Annualized) | 1.29% | | Return on average tangible common equity (Annualized) | 14.31% | | Net interest margin | 3.88% | [About Middlefield Banc Corp. and Disclosures](index=4&type=section&id=About%20Middlefield%20Banc%20Corp.) This section outlines Middlefield Banc Corp.'s operations, non-GAAP measures, and forward-looking statements disclosures - Middlefield Banc Corp. is the bank holding company for The Middlefield Banking Company, with **$1.92 billion** in total assets as of June 30, 2025, operating **21 full-service banking centers** in Ohio[22](index=22&type=chunk) - The report includes non-GAAP measures like tangible book value and pre-tax, pre-provision income, which management believes provide a better understanding of underlying operational results[23](index=23&type=chunk) - The press release contains forward-looking statements that are subject to risks and uncertainties, including competitive pressures, interest rate changes, and economic conditions[24](index=24&type=chunk)
Middlefield Banc Corp. Reports 2025 Six-Month Financial Results
Globenewswire· 2025-07-22 20:05
Core Viewpoint - Middlefield Banc Corp. reported strong financial growth and profitability for the second quarter of 2025, with significant increases in total loans, net interest income, and net income compared to the previous year [3][7]. Financial Performance - Total loans increased by 5.6% year-over-year to a record $1.58 billion, reflecting an annualized growth rate of 8.2% since the beginning of the year [3][9]. - Net interest income for the second quarter rose by 15.6% to $17.4 million, compared to $15.1 million in the same period of 2024 [4]. - Net income for the second quarter was $6.2 million, or $0.76 per diluted share, up from $4.2 million, or $0.52 per diluted share, in the prior year [7]. - Noninterest income for the second quarter was $3.1 million, compared to $1.8 million for the same period last year [5]. Asset Quality - Nonperforming assets to total assets improved to 1.30% at June 30, 2025, down from 1.62% at December 31, 2024 [18]. - The allowance for credit losses stood at $22.3 million, or 1.41% of total loans, compared to $21.8 million, or 1.46% of total loans, at June 30, 2024 [17]. Balance Sheet Highlights - Total assets increased by 5.3% year-over-year to a record $1.92 billion [9]. - Total deposits rose by 8.4% year-over-year to $1.59 billion, driven by growth in money market and interest-bearing demand deposits [11]. - Stockholders' equity increased by 4.5% year-over-year to $216.1 million, with a per-share value of $26.74 [13]. Strategic Initiatives - The company is focused on expanding its presence in Central Ohio, with plans to open a new branch in Westerville in the second half of 2025 [3]. - Investments in technology infrastructure and hiring experienced commercial bankers are part of the strategy to enhance growth and profitability [3].
Middlefield Banc Corp. Announces Retirement of Darryl E. Mast from Board of Directors
Globenewswire· 2025-05-22 12:00
Core Points - Middlefield Banc Corp. announced the retirement of Darryl E. Mast from its Board of Directors, effective May 14, 2025 [1] - Mr. Mast has been a member of the Board since 2011 and has significantly contributed to the company's success [2] - Following Mr. Mast's retirement, the Board will remain at 11 members as his position will not be replaced [3] Company Overview - Middlefield Banc Corp. is headquartered in Middlefield, Ohio, and serves as the holding company for The Middlefield Banking Company [4] - As of March 31, 2025, the company reported total assets of $1.89 billion [4] - The Bank operates 21 full-service banking centers and a brokerage office, serving multiple locations in Ohio [4]
Middlefield Banc(MBCN) - 2025 Q1 - Quarterly Report
2025-05-13 20:08
Part I [Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20%28unaudited%29) This section presents Middlefield Banc Corp.'s unaudited consolidated financial statements for Q1 2025, including the balance sheet, income statement, comprehensive income, equity changes, cash flows, and detailed notes [Consolidated Balance Sheet](index=4&type=section&id=Consolidated%20Balance%20Sheet) As of March 31, 2025, total assets were $1.89 billion, a slight increase from $1.85 billion at year-end 2024, driven by loan and deposit growth Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | **Total Assets** | **$1,888,356** | **$1,853,359** | **$34,997** | **1.9%** | | Net Loans | $1,527,948 | $1,497,167 | $30,781 | 2.1% | | Total Deposits | $1,539,725 | $1,445,693 | $94,032 | 6.5% | | Federal Home Loan Bank advances | $110,000 | $172,400 | ($62,400) | (36.2%) | | **Total Liabilities** | **$1,674,563** | **$1,642,797** | **$31,766** | **1.9%** | | **Total Stockholders' Equity** | **$213,793** | **$210,562** | **$3,231** | **1.5%** | [Consolidated Statement of Income](index=5&type=section&id=Consolidated%20Statement%20of%20Income) For the three months ended March 31, 2025, net income increased 15.9% to $4.83 million, driven by higher net interest income and lower interest expense Q1 2025 vs Q1 2024 Income Statement (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net Interest Income | $16,098 | $14,969 | $1,129 | 7.5% | | Provision for (Recovery of) credit losses | $95 | ($136) | $231 | N/A | | Total Noninterest Income | $1,944 | $1,796 | $148 | 8.2% | | Total Noninterest Expense | $12,193 | $11,965 | $228 | 1.9% | | **Net Income** | **$4,830** | **$4,167** | **$663** | **15.9%** | | **Basic EPS** | **$0.60** | **$0.52** | **$0.08** | **15.4%** | [Consolidated Statement of Comprehensive Income (Loss)](index=7&type=section&id=Consolidated%20Statement%20of%20Comprehensive%20Income%20%28Loss%29) Comprehensive income for Q1 2025 more than doubled to $4.46 million, primarily due to higher net income and a significantly smaller other comprehensive loss Comprehensive Income (Loss) (in thousands) | Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Income | $4,830 | $4,167 | | Other comprehensive income (loss), net of tax | ($367) | ($2,040) | | **Comprehensive income (loss)** | **$4,463** | **$2,127** | [Consolidated Statement of Changes in Stockholders' Equity](index=8&type=section&id=Consolidated%20Statement%20of%20Changes%20in%20Stockholders%27%20Equity) Stockholders' equity increased to $213.8 million at March 31, 2025, driven by net income, partially offset by cash dividends and other comprehensive loss - Key drivers for the change in stockholders' equity in Q1 2025 were **net income of $4.83 million**, offset by **cash dividends of $1.70 million** (**$0.21 per share**) and an **other comprehensive loss of $0.37 million**[22](index=22&type=chunk) - In Q1 2024, the company repurchased **43,858 common shares** for **$1.06 million**, whereas no shares were repurchased in Q1 2025[22](index=22&type=chunk) [Consolidated Statement of Cash Flows](index=9&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) Cash and cash equivalents increased by $11.1 million in Q1 2025, primarily from financing activities, offsetting investing activities and supplemented by operations Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $8,018 | $5,440 | | Net cash provided by (used in) investing activities | ($26,824) | ($11,611) | | Net cash provided by (used in) financing activities | $29,884 | ($8,411) | | **Increase (decrease) in cash and cash equivalents** | **$11,078** | **($14,582)** | [Notes to Unaudited Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Financial%20Statements) The notes provide detailed supplementary information on accounting policies, fair value measurements, loan portfolio, allowance for credit losses, and subsequent events - Note 5 details fair value measurements, classifying assets into Level 1, 2, and 3 hierarchies. As of March 31, 2025, the vast majority of recurring fair value assets (**$158.4 million** of **$165.7 million**) are Level II, valued using observable market data[46](index=46&type=chunk)[48](index=48&type=chunk) - Note 7 provides an in-depth analysis of the loan portfolio and the Allowance for Credit Losses (ACL). The total ACL was **$22.4 million** as of March 31, 2025, a slight decrease from year-end 2024, with changes driven by portfolio activity and updated economic assumptions[70](index=70&type=chunk)[71](index=71&type=chunk) - Note 11 discloses two significant subsequent events in April 2025: a real estate exchange with the City of Westerville resulting in a **$1.2 million gain**, and a plan to sell another property resulting in a recognized **loss of $700,000**[107](index=107&type=chunk)[108](index=108&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=37&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial condition and results of operations for Q1 2025, highlighting increased EPS, expanded net interest margin, and improved asset quality - Financial highlights for Q1 2025 include a **17.6% YoY increase** in diluted EPS to **$0.60**, a **12 basis point increase** in annualized ROA to **1.04%**, and a **5% increase** in the quarterly dividend to **$0.21 per share**[117](index=117&type=chunk) - Total assets grew by **$35.0 million** to **$1.89 billion** since year-end 2024, driven by a **$30.7 million increase** in total loans. This growth was funded by a **$94.0 million increase** in deposits[126](index=126&type=chunk) - Net interest income rose **7.5% YoY** to **$16.1 million**, with the net interest margin expanding **15 basis points** to **3.69%**. This was attributed to lower costs on certain deposits and borrowings, and higher loan balances[155](index=155&type=chunk) [Changes in Financial Condition](index=38&type=section&id=Changes%20in%20Financial%20Condition) Total assets increased by $35.0 million to $1.89 billion at March 31, 2025, driven by loan and deposit growth, while short-term borrowings decreased Loan Portfolio Changes (Q1 2025 vs YE 2024, in thousands) | Loan Category | March 31, 2025 | Dec 31, 2024 | $ Change | | :--- | :--- | :--- | :--- | | Construction and other | $122,653 | $103,608 | $19,045 | | Commercial and industrial | $235,547 | $229,034 | $6,513 | | Home equity lines of credit | $147,154 | $143,379 | $3,775 | | **Total Loans** | **$1,550,349** | **$1,519,614** | **$30,735** | Deposit Portfolio Changes (Q1 2025 vs YE 2024, in thousands) | Deposit Category | March 31, 2025 | Dec 31, 2024 | $ Change | | :--- | :--- | :--- | :--- | | Money market | $481,664 | $414,074 | $67,590 | | Time | $275,673 | $247,704 | $27,969 | | Interest-bearing demand | $222,953 | $208,291 | $14,662 | | **Total Deposits** | **$1,539,725** | **$1,445,693** | **$94,032** | - The Allowance for Credit Losses (ACL) decreased slightly by **$46,000** to **$22.4 million**. Nonperforming loans stood at **$29.6 million**, down from **$30.0 million** at year-end 2024[142](index=142&type=chunk)[147](index=147&type=chunk) [Results of Operations](index=49&type=section&id=Results%20of%20Operations) Net income for Q1 2025 increased 15.9% to $4.8 million, driven by a 7.5% rise in net interest income and a modest 1.9% increase in noninterest expense - Net interest income increased by **$1.1 million** YoY, driven by a **$60.8 million** increase in the average balance of loans and a decrease in the cost of FHLB advances[155](index=155&type=chunk)[157](index=157&type=chunk) - Interest expense decreased by **$268,000** YoY, mainly due to a **$646,000** reduction in short-term borrowing expense as FHLB advances were paid down[158](index=158&type=chunk) - Noninterest income increased by **$148,000** YoY, largely due to a **$633,000** tax-free benefit from a bank-owned life insurance death claim[160](index=160&type=chunk) [Liquidity and Regulatory Capital](index=53&type=section&id=Liquidity%20and%20Regulatory%20Capital) The company maintained a strong liquidity position of $785.2 million at March 31, 2025, exceeding uninsured deposits, and met all 'well-capitalized' regulatory capital requirements - Total net available liquidity was **$785.2 million** at March 31, 2025, covering **51.0%** of total deposits[171](index=171&type=chunk) - Uninsured deposit balances were approximately **$486.4 million**, or **31.6%** of total deposits, at March 31, 2025[149](index=149&type=chunk) Regulatory Capital Ratios as of March 31, 2025 | Ratio | Middlefield Banc Corp. | The Middlefield Banking Company | Well-Capitalized Requirement (Bank) | | :--- | :--- | :--- | :--- | | Tier 1 Leverage | 10.92% | 10.87% | 5.00% | | Common Equity Tier 1 | 11.61% | 11.92% | 6.50% | | Tier 1 Risk Based | 12.09% | 11.92% | 8.00% | | Total Risk Based | 13.35% | 13.17% | 10.00% | [Quantitative and Qualitative Disclosures about Market Risk](index=55&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company manages interest rate risk through simulation modeling, projecting NII and EVE impacts within policy limits, indicating a slightly liability-sensitive position Interest Rate Sensitivity Analysis (as of March 31, 2025) | Change in Rates | % Change in Net Interest Income (NII) | % Change in Economic Value of Equity (EVE) | | :--- | :--- | :--- | | +200bp | (2.60%) | (3.00%) | | -100bp | 1.30% | (0.20%) | - The company's policy limits for interest rate risk are a maximum **10% reduction** in NII for a **+/- 200bp gradual rate shift** and a maximum **20% change** in EVE for a **+200bp immediate rate shock**. The current simulations are well within these guidelines[186](index=186&type=chunk)[187](index=187&type=chunk) [Controls and Procedures](index=57&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective, with no material changes to internal control over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[192](index=192&type=chunk) - No changes in internal control over financial reporting occurred during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[194](index=194&type=chunk) Part II [Legal Proceedings](index=57&type=section&id=Item%201.%20Legal%20Proceedings) A class action lawsuit related to the April 2023 cyber-attack has been settled, with final court approval granted on April 1, 2025, and losses covered by insurance - The class action lawsuit stemming from the April 2023 cyber-attack received final court approval for settlement on **April 1, 2025**[100](index=100&type=chunk) - Losses related to the incident are within the coverage limits of the company's **$3 million cyber risk insurance policy**, which has a **$50,000 deductible**[100](index=100&type=chunk) [Risk Factors](index=57&type=section&id=Item%201a.%20Risk%20Factors) There have been no material updates or changes to the company's risk factors since the year ended December 31, 2024 - No material changes in risk factors have occurred since **December 31, 2024**[196](index=196&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=57&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company did not repurchase any common shares in Q1 2025, with 250,052 shares remaining available for repurchase under the board-authorized program - No common shares were repurchased in the first quarter of 2025[197](index=197&type=chunk) - The company has authorization to repurchase an additional **250,052 shares** under its existing program as of **March 31, 2025**[197](index=197&type=chunk) [Other Information](index=58&type=section&id=Item%205.%20Other%20information) No Rule 10b5-1 or non-Rule 10b5-1 trading arrangements were adopted, modified, or terminated by any director or officer during the first quarter of 2025 - No Rule 10b5-1 or non-Rule 10b5-1 trading arrangements were adopted, modified, or terminated by any director or officer in Q1 2025[199](index=199&type=chunk) [Exhibits](index=59&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with or incorporated by reference into the Form 10-Q report, including articles of incorporation, various agreements, and certifications