Midland States Bancorp, Inc. Announces 2025 Fourth Quarter Results

Core Insights - Midland States Bancorp reported a net loss of $5.1 million, or $0.24 per diluted share, for Q4 2025, contrasting with a net income of $5.3 million, or $0.24 per diluted share, in Q3 2025, and a net loss of $33.0 million, or $1.52 per diluted share, in Q4 2024 [1][8][21] Financial Performance - The financial results for Q4 2025 included a loss of $21.4 million from the sale of the equipment finance portfolio and a $1.6 million loss from a small consumer loan portfolio. Adjusted earnings, excluding these losses, were $11.9 million, or $0.53 per diluted share [2][8] - The net interest margin for Q4 2025 was 3.74%, down from 3.79% in Q3 2025, but showed an increase of 5 basis points when excluding interest recoveries from the previous quarter [8][16] - Noninterest income increased to $26.9 million in Q4 2025 from $20.0 million in Q3 2025, driven by $6.6 million in additional credit enhancement income [22] Asset Quality and Loan Portfolio - The ratio of nonperforming assets to total assets was 1.02%, consistent with the prior quarter, while nonperforming loans decreased to $65.5 million from $68.7 million in Q3 2025 [8][9] - Total loans decreased to $4.35 billion, a reduction of $515.6 million from Q3 2025, primarily due to the sale of the equipment finance portfolio [14] - The provision for credit losses on loans was $11.8 million for Q4 2025, down from $20.5 million in Q3 2025, reflecting a replenishment of reserves following higher net charge-offs [13][21] Capital Position - The common equity tier 1 capital ratio improved to 9.89%, approaching the target of 10.0%. The total capital to risk-weighted assets ratio was 15.16% [6][25] - The company repurchased $9.6 million of common stock during Q4 2025, with approximately $15 million remaining under the share repurchase program [6][24] Business Outlook - The company aims to continue improving credit quality and has taken significant steps to reduce risk in its loan portfolio while enhancing its balance sheet without raising additional capital [5] - Revenue trends remain positive, with a strong net interest margin and approximately 6.5% annualized loan growth in the Community Bank, alongside record performance in the wealth management business [7][12]