Midland States Bancorp, Inc. Announces 2025 Second Quarter Results

Core Viewpoint - Midland States Bancorp, Inc. reported a significant decrease in net income for the second quarter of 2025, reflecting a recovery from a substantial loss in the previous quarter, with ongoing improvements in credit quality and profitability expected for the remainder of the year [1][2][4]. Financial Performance - Net income available to common shareholders for Q2 2025 was $9.8 million, or $0.44 per diluted share, down from $23.5 million, or $1.06 per diluted share in Q2 2024 [1][7]. - Compared to Q1 2025, which had a net loss of $143.2 million due to goodwill impairment, the company showed a recovery in profitability [2][19]. - Pre-provision net revenue increased to $32.2 million in Q2 2025 from $27.0 million in Q1 2025 [7]. - The net interest margin expanded by 7 basis points to 3.56% in Q2 2025, compared to 3.49% in Q1 2025 [7][15]. Credit Quality - Non-performing assets decreased to $111 million, or 1.56% of total assets, down from $151 million, or 2.08% in Q1 2025 [5][7]. - The company reported limited new substandard or non-performing loans during the quarter, with substandard accruing loans and non-performing loans decreasing to $58.5 million and $109.5 million, respectively [8][19]. - Net charge-offs for the quarter were $29.9 million, with significant charge-offs in the specialty finance portfolio [8][21]. Capital and Liquidity - Capital levels increased quarter-over-quarter, with a common equity tier 1 capital ratio of 9.02% and total capital to risk-weighted assets at 14.50% [7][20]. - The company successfully exited two larger non-performing relationships totaling $29 million after the quarter-end, which is expected to further improve the non-performing asset ratio [5][19]. Loan Portfolio and Deposits - Total loans as of June 30, 2025, were $5.06 billion, reflecting an increase of $46.6 million from March 31, 2025 [14]. - Total deposits were $5.95 billion, a slight increase of $10.5 million from the previous quarter, with notable increases in commercial and public fund deposits [14][29]. Wealth Management - Wealth management revenue totaled $7.4 million in Q2 2025, with assets under administration reaching $4.18 billion [14][21].