FALSE000146602600014660262025-01-232025-01-23

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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): January 23, 2025
Midland States Bancorp, Inc.
(Exact Name of Registrant as Specified in Its Charter)
Illinois 001-35272 37-1233196
(State or Other Jurisdiction of Incorporation) (Commission File Number) (IRS Employer Identification No.)

1201 Network Centre Drive
Effingham, Illinois 62401
(Address of Principal Executive Offices) (Zip Code)
 
(217) 342-7321
(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 classTrading symbol(s)Name of each exchange on which registered
Common Stock, $0.01 par valueMSBIThe Nasdaq Market LLC
Depositary Shares, each representing a 1/40th interest in a share of 7.75% fixed rate reset non-cumulative perpetual preferred stock, Series A, $2.00 par valueMSBIPThe Nasdaq 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 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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 January 23, 2025, Midland States Bancorp, Inc. (the “Company”) issued a press release announcing its financial results for the fourth quarter of 2024. The press release is attached as Exhibit 99.1.
Item 7.01. Regulation FD Disclosure.
On January 23, 2025, the Company made available on its website a slide presentation regarding the Company's fourth quarter 2024 financial results. The slide presentation is attached as Exhibit 99.2.
The information set forth under Items 2.02 and 7.01 in this Form 8-K and the attached exhibits shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, and shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in any such filing.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.  
Exhibit No.Description
Press Release of Midland States Bancorp, Inc., dated January 23, 2025
Slide Presentation of Midland States Bancorp, Inc. regarding fourth quarter 2024 financial results
104Cover Page Interactive Data File (embedded within the Inline XBRL document)
SIGNATURE
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 thereunto duly authorized.
 Date: January 23, 2025
By:/s/ Eric T. Lemke
  Eric T. Lemke
  Chief Financial Officer




EXHIBIT 99.1

Midland States Bancorp, Inc. Announces 2024 Fourth Quarter Results

Fourth Quarter 2024 Highlights:
•Net loss available to common shareholders of $54.8 million, or $2.52 per diluted share
•Adjusted pre-tax, pre-provision earnings of $21.5 million, compared to $27.5 million in prior quarter
•Sold $87.1 million LendingPoint consumer loan portfolio, recognizing net charge-offs and provision for credit losses of $17.3 million
•Committed to a plan to sell $371.7 million Greensky portfolio, recognizing net charge-offs and provision for credit losses of $33.4 million
•Net charge-offs on loans of $102.7 million and provision for credit losses on loans of $93.5 million to address credit issues in the loan portfolio including credit losses for LendingPoint and Greensky portfolios
•Net interest margin of 3.19%, compared to 3.10% in prior quarter
•Wealth management revenue of $7.7 million, compared to $7.1 million in prior quarter
•Common equity tier 1 capital ratio of 8.37%, compared to 9.00% at September 30, 2024 and 8.40% at December 31, 2023
•Total risk-based capital ratio of 13.38%, compared to 13.98% at September 30, 2024 and 13.20% at December 31, 2023
Effingham, IL, January 23, 2025 (GLOBE NEWSWIRE) -- Midland States Bancorp, Inc. (Nasdaq: MSBI) (the “Company”) today reported net loss available to common shareholders of $54.8 million, or $2.52 per diluted share, for the fourth quarter of 2024, compared to net income of $16.2 million, or $0.74 per diluted share, for the third quarter of 2024. This also compares to net income available to common shareholders of $18.5 million, or $0.84 per diluted share, for the fourth quarter of 2023.
During the fourth quarter of 2024, the Company took several actions to address its credit quality issues and exit its non-core consumer loan portfolios. Our deteriorating credit quality issues were primarily within three sectors of our business: non-core consumer loans, Specialty Finance Group, and Midland Equipment Financing.
In the quarter, the Company decided to accelerate the reduction of our non-core consumer loan portfolio through sales. These loans were originated by our Fintech partners, LendingPoint and Greensky. As a result of LendingPoint’s system conversion in the third quarter of 2023, our portfolio experienced significant credit deterioration and servicing-related deficiencies. In December 2024, we sold our $87.1 million LendingPoint portfolio, recognizing net charge-offs and provision for credit losses of $17.3 million on the sale. We also committed to a plan to sell $371.7 million of our Greensky consumer loan portfolio and recognized net charge-offs and provision for credit losses of $33.4 million when these loans


were transferred to held for sale. We expect to provide partial financing on the sale with senior secured loans to a special purpose entity with credit subordination and a 20% risk weighting.
The Specialty Finance Group provides bridge loan financing for commercial real estate projects, primarily multi-family and healthcare. These projects can include construction and seek short term financing in anticipation of obtaining permanent secondary market financing. The loans are typically outside of the Company’s primary market areas. We completed a strategic review of this portfolio including obtaining updated appraisals on loans that had shown elevated credit risk in the third and fourth quarters. As a result of this review, five loans with balances of $57.8 million were moved from substandard to non-performing with recognized charge-offs of $6.6 million. In addition, updated appraisals were obtained for five non-performing loans with balances of $55.8 million which resulted in charge-offs of $18.8 million recognized in the fourth quarter of 2024. In addition, we recognized impairment expense on an OREO property related to a former assisted living loan of $2.1 million in the fourth quarter of 2024.
The strategic review also included all criticized loans, construction loans and loans that failed our stress test in all portfolios, including our community bank. This resulted in charge-offs of almost all specific reserves. In addition, the Company tightened credit standards going forward and will not originate new construction loans in the Specialty Finance Group. Our strategic actions around credit administration will better position the Company going forward.
The equipment finance portfolio includes loans and leases originated to customers throughout the United States. During 2024, we experienced elevated charge-offs primarily within the trucking industry. Charge-offs in this portfolio were $15.3 million in the fourth quarter of 2024 as we evaluated equipment values for nonaccrual assets. Nonaccrual loans and leases in the finance portfolio decreased to $11.3 million from $21.4 million at September 30, 2024. Additionally, based on further deterioration in the industry, we evaluated salvage values of the leases and loans related to this industry, along with the carrying values of repossessed and off-lease equipment, and recognized impairment expense of $7.6 million.
Jeffrey G. Ludwig, President and Chief Executive Officer of the Company, said, “Improving credit quality is our number one priority and in the fourth quarter we took significant steps to reduce credit risk and address our underlying credit issues. During the quarter we made the difficult decision to exit our non-core consumer portfolio and charge-off deteriorating credits in an effort to better position the Company to grow our core community banking business. Our team also reviewed our credit risk appetite profile and tightened standards going forward. On a positive note, substandard accruing loans decreased significantly in the quarter with minimal downgrades to substandard accruing. Delinquencies decreased during the quarter as well.
“We are seeing positive trends in new client additions in both our community bank and wealth management, net interest margin expanded in the quarter and with the actions we took in the quarter to reduce credit risk, we believe we are well positioned to deliver solid financial performance in 2025. We will continue to make investments in talent, technology, and marketing to further enhance our ability to generate profitable growth in the coming years” said Mr. Ludwig.
Balance Sheet Highlights
Total assets were $7.53 billion at December 31, 2024, compared to $7.75 billion at September 30, 2024, and $7.87 billion at December 31, 2023. At December 31, 2024, portfolio loans were $5.17 billion, compared to $5.75 billion at September 30, 2024, and $6.13 billion at December 31, 2023.


Loans
During the fourth quarter of 2024, outstanding loans declined by $581.2 million, or 10.1%, from September 30, 2024, primarily as a result of the Company’s decision to sell the Greensky and LendingPoint consumer loan portfolios, and the continuation of the Company’s plan to decrease its equipment financing portfolio to focus on commercial loan opportunities in our community banking regions.
Consumer loans decreased $506.0 million to $157.2 million at December 31, 2024, primarily due to the loan portfolio sale, transfer to held for sale, and loan paydowns. Equipment finance loan and lease balances decreased $51.7 million during the fourth quarter of 2024 as the Company continued to reduce its concentration of this product within the overall loan portfolio. Equipment financing and consumer loans comprised 15.6% and 3.0%, respectively, of the loan portfolio at December 31, 2024, compared to 15.0% and 11.5%, respectively, at September 30, 2024.
As of
December 31,September 30,June 30,March 31,December 31,
(in thousands)20242024202420242023
Loan Portfolio
Commercial loans$921,930 $863,922 $939,458 $913,564 $951,387 
Equipment finance loans416,969 442,552 461,409 494,068 531,143 
Equipment finance leases391,390 417,531 428,659 455,879 473,350 
Commercial FHA warehouse lines8,004 50,198 — 8,035 — 
Total commercial loans and leases1,738,293 1,774,203 1,829,526 1,871,546 1,955,880 
Commercial real estate2,591,664 2,510,472 2,421,505 2,397,113 2,406,845 
Construction and land development299,842 422,253 476,528 474,128 452,593 
Residential real estate380,557 378,657 378,393 378,583 380,583 
Consumer157,218 663,234 746,042 837,092 935,178 
Total loans$5,167,574 $5,748,819 $5,851,994 $5,958,462 $6,131,079 
Loan Quality
Substandard accruing loans decreased $88.7 million to $78.8 million at December 31, 2024, as compared to September 30, 2024. This decrease was the result of a payoff of a $15.4 million relationship and the transfer of $75.1 million of problem loans to nonaccrual status. No significant new substandard loans were identified during the quarter.
Nonperforming loans increased $25.6 million to $140.1 million at December 31, 2024, as compared to September 30, 2024. Charged off nonperforming loans in the fourth quarter of 2024 totaled $48.9 million, partially offsetting the amount of loans transferred to nonaccrual status in the quarter.



As of and for the Three Months Ended
(in thousands)December 31,September 30,June 30,March 31,December 31,
20242024202420242023
Asset Quality
Loans 30-89 days past due$36,522 $55,329 $54,045 $58,854 $82,778 
Nonperforming loans140,138 114,556 112,124 104,979 56,351 
Nonperforming assets148,290 126,771 123,774 116,721 67,701 
Substandard accruing loans78,800 167,549 135,555 149,049 184,224 
Net charge-offs102,660 11,379 2,874 4,445 5,117 
Loans 30-89 days past due to total loans0.71 %0.96 %0.92 %0.99 %1.35 %
Nonperforming loans to total loans2.71 %1.99 %1.92 %1.76 %0.92 %
Nonperforming assets to total assets1.97 %1.64 %1.60 %1.49 %0.86 %
Allowance for credit losses to total loans1.46 %1.49 %1.58 %1.31 %1.12 %
Allowance for credit losses to nonperforming loans53.81 %74.90 %82.22 %74.35 %121.56 %
Net charge-offs to average loans7.23 %0.78 %0.20 %0.30 %0.33 %
The Company recognized provision expense for credit losses on loans of $93.5 million in the fourth quarter of 2024, and recorded net loan charge-offs of $102.7 million. Provision expense for credit losses on loans was $5.0 million and $7.0 million in the third quarter of 2024 and fourth quarter of 2023, respectively. For the year ended December 31, 2024, the Company recognized provision expense for credit losses of $129.3 million and recorded net charge-offs of $121.4 million.
The allowance for credit losses on loans totaled $75.4 million at December 31, 2024, compared to $85.8 million at September 30, 2024, and $68.5 million at December 31, 2023. The allowance as a percentage of total loans was 1.46% at December 31, 2024, compared to 1.49% at September 30, 2024, and 1.12% at December 31, 2023.
Deposits
Total deposits were $6.20 billion at December 31, 2024, compared with $6.26 billion at September 30, 2024. Noninterest-bearing deposits increased $4.9 million while interest-bearing deposits decreased $64.5 million. Brokered time deposits represented 4.2% of total deposits at December 31, 2024.
As of
December 31,September 30,June 30,March 31,December 31,
(in thousands)20242024202420242023
Deposit Portfolio
Noninterest-bearing demand$1,055,564 $1,050,617 $1,108,521 $1,212,382 $1,145,395 
Interest-bearing:
Checking2,378,256 2,389,970 2,343,533 2,394,163 2,511,840 
Money market1,173,630 1,187,139 1,143,668 1,128,463 1,135,629 
Savings507,305 510,260 538,462 555,552 559,267 
Time822,981 849,413 852,415 845,190 862,865 
Brokered time259,507 269,437 131,424 188,234 94,533 
Total deposits$6,197,243 $6,256,836 $6,118,023 $6,323,984 $6,309,529 


Results of Operations Highlights
Net Interest Income and Margin
During the fourth quarter of 2024, net interest income and net interest margin, on a tax-equivalent basis, increased to $56.3 million and 3.19%, respectively, compared to $55.2 million and 3.10%, respectively, in the third quarter of 2024. The actions taken by the Federal Reserve Bank to lower short term interest rates resulted in lower funding costs for the Company. Net interest income and net interest margin, on a tax-equivalent basis, were $58.3 million and 3.21%, respectively, in the fourth quarter of 2023.
Average interest-earning assets for the fourth quarter of 2024 were $7.01 billion, compared to $7.07 billion for the third quarter of 2024. The yield on interest-earning assets decreased 11 basis points to 5.80% compared to the third quarter of 2024, due in part to interest reversals of $1.5 million on substandard loans transferred to nonaccrual status in the fourth quarter and the impact of interest rate cuts enacted by the Federal Reserve Bank. Interest-earning assets averaged $7.20 billion for the fourth quarter of 2023.
Average loans were $5.65 billion for the fourth quarter of 2024, compared to $5.78 billion for the third quarter of 2024 and $6.20 billion for the fourth quarter of 2023. The yield on loans was 6.04% for the fourth quarter of 2024, compared to 6.15% for the third quarter of 2024 and 6.00% for the fourth quarter of 2023.
Investment securities averaged $1.21 billion for the fourth quarter of 2024, and yielded 4.73%, compared to an average balance and yield of $1.16 billion and 4.71%, respectively, for the third quarter of 2024. Investment securities averaged $883.2 million and yielded 4.16% for the fourth quarter of 2023. The Company purchased additional higher-yielding investments during 2024, resulting in the increased average balance and yield.
Average interest-bearing liabilities for the fourth quarter of 2024 were $5.69 billion, compared to $5.76 billion for the third quarter of 2024. The cost of funds decreased 24 basis points to 3.21% compared to the third quarter of 2024. Interest-bearing liabilities averaged $5.88 billion for the fourth quarter of 2023.
Average interest-bearing deposits were $5.24 billion for the fourth quarter of 2024, compared to $5.13 billion for the third quarter of 2024, and $5.30 billion for the fourth quarter of 2023. Cost of interest-bearing deposits was 3.04% in the fourth quarter of 2024, which represented a 21 basis point decrease from the third quarter of 2024, due to the recent rate cuts enacted by the Federal Reserve Bank.


For the Three Months Ended
(dollars in thousands)December 31, 2024September 30, 2024December 31, 2023
Interest-earning assetsAverage BalanceInterest & FeesYield/RateAverage BalanceInterest & FeesYield/RateAverage BalanceInterest & FeesYield/Rate
Cash and cash equivalents$96,676 $1,101 4.53 %$75,255 $1,031 5.45 %$77,363 $1,054 5.41 %
Investment securities(1)
1,213,248 14,417 4.73 1,162,751 13,752 4.71 883,153 9,257 4.16 
Loans(1)(2)
5,652,586 85,877 6.04 5,783,408 89,344 6.15 6,196,362 93,757 6.00 
Loans held for sale12,854 129 4.00 7,505 124 6.57 4,429 81 7.26 
Nonmarketable equity securities35,171 632 7.15 41,137 788 7.62 41,192 715 6.89 
Total interest-earning assets7,010,535 102,156 5.80 7,070,056 105,039 5.91 7,202,499 104,864 5.78 
Noninterest-earning assets669,300 653,279 695,293 
Total assets$7,679,835 $7,723,335 $7,897,792 
Interest-Bearing Liabilities
Interest-bearing deposits$5,241,702 $40,016 3.04 %$5,132,640 $41,970 3.25 %$5,295,296 $39,156 2.93 %
Short-term borrowings31,853 214 2.68 53,577 602 4.47 13,139 15 0.47 
FHLB advances & other borrowings284,033 2,880 4.03 428,739 4,743 4.40 430,207 4,750 4.38 
Subordinated debt80,410 1,498 7.41 89,120 1,228 5.48 93,512 1,281 5.43 
Trust preferred debentures51,132 1,292 10.05 50,990 1,341 10.46 50,541 1,402 11.00 
Total interest-bearing liabilities5,689,130 45,900 3.21 5,755,066 49,884 3.45 5,882,695 46,604 3.14 
Noninterest-bearing deposits1,066,520 1,075,712 1,142,062 
Other noninterest-bearing liabilities117,478 97,235 108,245 
Shareholders’ equity806,707 795,322 764,790 
Total liabilities and shareholder’s equity$7,679,835 $7,723,335 $7,897,792 
Net Interest Margin$56,256 3.19 %$55,155 3.10 %$58,260 3.21 %
Cost of Deposits2.52 %2.69 %2.41 %

(1)Interest income and average rates for tax-exempt loans and investment securities are presented on a tax-equivalent basis, assuming a federal income tax rate of 21%. Tax-equivalent adjustments totaled $0.2 million for each of the three months ended December 31, 2024, September 30, 2024 and December 31, 2023, respectively.
(2)Average loan balances include nonaccrual loans. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs.
For the year ended December 31, 2024, net interest income, on a tax-equivalent basis, decreased to $222.8 million, with a tax-equivalent net interest margin of 3.15%, compared to net interest income, on a tax-equivalent basis, of $236.8 million, and a tax-equivalent net interest margin of 3.26% for the year ended December 31, 2023.
The yield on earning assets increased 26 basis points to 5.83% for the year ended December 31, 2024 compared to the prior year. However, the cost of interest-bearing liabilities increased at a faster rate during this period, increasing 44 basis points to 3.31% for the year ended December 31, 2024.


For the Years Ended
(dollars in thousands)December 31, 2024December 31, 2023
Interest-earning assetsAverage BalanceInterest & FeesYield/RateAverage BalanceInterest & FeesYield/Rate
Cash and cash equivalents$76,675 $3,958 5.16 %$77,046 $3,922 5.09 %
Investment securities(1)
1,116,186 51,682 4.63 854,576 30,361 3.55 
Loans(1)(2)
5,840,216 353,447 6.05 6,292,260 367,762 5.84 
Loans held for sale7,185 392 5.45 4,034 260 6.45 
Nonmarketable equity securities39,108 3,070 7.85 43,318 2,819 6.51 
Total interest-earning assets7,079,370 412,549 5.83 7,271,234 405,124 5.57 
Noninterest-earning assets665,308 635,490 
Total assets$7,744,678 $7,906,724 
Interest-Bearing Liabilities
Interest-bearing deposits$5,167,787 $160,676 3.11 %$5,241,723 $136,947 2.61 %
Short-term borrowings45,251 1,960 4.33 23,406 68 0.29 
FHLB advances & other borrowings381,525 16,495 4.32 460,781 20,709 4.49 
Subordinated debt89,028 5,271 5.92 95,986 5,266 5.49 
Trust preferred debentures50,938 5,380 10.56 50,298 5,289 10.52 
Total interest-bearing liabilities5,734,529 189,782 3.31 5,872,194 168,279 2.87 
Noninterest-bearing deposits1,106,388 1,173,873 
Other noninterest-bearing liabilities109,777 90,562 
Shareholders’ equity793,984 770,095 
Total liabilities and shareholders’ equity$7,744,678 $7,906,724 
Net Interest Margin$222,767 3.15 %$236,845 3.26 %
Cost of Deposits2.56 %2.13 %

(1)Interest income and average rates for tax-exempt loans and investment securities are presented on a tax-equivalent basis, assuming a federal income tax rate of 21%. Tax-equivalent adjustments totaled $0.8 million for each of the years ended December 31, 2024 and 2023, respectively.
(2)Average loan balances include nonaccrual loans. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs.
Noninterest Income
Noninterest income was $19.6 million for the fourth quarter of 2024, compared to $19.3 million for the third quarter of 2024. Noninterest income for the fourth quarter of 2023 was $20.5 million, and included incremental servicing revenues of $2.2 million and $1.6 million related to our commercial FHA servicing portfolio and the Greensky portfolio, respectively. Also included was a $1.1 million one-time gain from the sale of Visa B stock, offset by $2.9 million of losses on the sale of investment securities. Excluding


these transactions, noninterest income for the fourth quarter of 2024, the third quarter of 2024, and the fourth quarter of 2023 was $19.6 million, $19.3 million, and $18.5 million, respectively.
For the Three Months EndedFor the Years Ended
December 31,September 30,December 31, December 31,December 31,
(in thousands)20242024202320242023
Noninterest income
Wealth management revenue$7,660 $7,104 $6,604 $28,697 $25,572 
Service charges on deposit accounts3,506 3,411 3,246 13,154 11,990 
Interchange revenue3,528 3,506 3,585 13,955 14,302 
Residential mortgage banking revenue637 697 451 2,418 1,903 
Income on company-owned life insurance1,975 1,982 1,753 7,683 4,439 
Loss on sales of investment securities, net(34)(44)(2,894)(230)(9,372)
Other income2,289 2,683 7,768 12,066 17,756 
Total noninterest income$19,561 $19,339 $20,513 $77,743 $66,590 

Wealth management revenue totaled $7.7 million in the fourth quarter of 2024, an increase of $0.6 million, or 7.8%, as compared to the third quarter of 2024, due to increases in trust and estate fees. Assets under administration were $4.15 billion at December 31, 2024 compared to $4.27 billion and $3.73 billion at September 30, 2024 and December 31, 2023, respectively.
Income on company-owned life insurance income totaled $2.0 million, $2.0 million and $1.8 million for the fourth quarter of 2024, the third quarter of 2024, and the fourth quarter of 2023, respectively.
On a full year basis, noninterest income increased $11.2 million, or 16.7%. Wealth management revenue increased $3.1 million due to increases in assets under administration and estate fees. Income on company-owned life insurance increased $3.2 million. The Company surrendered certain low-yielding life insurance policies and purchased additional policies in the third quarter of 2023, resulting in the increase in revenue. In 2024, we recognized net losses on the sales of investment securities of $0.2 million compared to $9.4 million in 2023, as we took advantage of certain market conditions last year to reposition out of lower yielding securities into other structures, which resulted in improved overall margin, liquidity and capital allocations. Several one-time transactions were recognized in other noninterest income in 2023, including incremental servicing revenues of $2.2 million and $1.6 million related to our commercial FHA servicing portfolio and the Greensky portfolio, respectively. In addition, the Company recognized a $1.1 million one-time gain from the sale of Visa B stock, a gain of $0.7 million on the redemption of subordinated debt and a gain of $0.8 million on the sale of OREO.
Noninterest Expense
Noninterest expense was $54.2 million in the fourth quarter of 2024, compared to $46.7 million in the third quarter of 2024 and $44.5 million in the fourth quarter of 2023. Noninterest expense for the fourth quarter of 2024 included $7.6 million of impairment on equipment financing operating lease collateral and surrendered equipment, and $2.1 million of impairment on an OREO property. Excluding these items, noninterest expense for the fourth quarter of 2024, the third quarter of 2024, and the fourth quarter of 2023 was $44.5 million, $46.7 million, and $44.5 million, respectively.


On a full year basis, in addition to the fourth quarter expenses previously described, costs related to upgrades to our ATM fleet, loan collection expenses, and settlement of various lawsuits drove the increase in noninterest expense as compared to the prior year.
The efficiency ratio for the quarter ended December 31, 2024 was 71.42% compared to 62.76% for the quarter ended September 30, 2024, and 55.22% for the fourth quarter of 2023.
For the Three Months EndedFor the Years Ended
December 31,September 30,December 31, December 31,December 31,
(in thousands)20242024202320242023
Noninterest expense
Salaries and employee benefits$22,283 $24,382 $24,031 $93,639 $93,438 
Occupancy and equipment4,286 4,393 3,934 16,785 15,986 
Data processing7,278 6,955 6,963 28,160 26,286 
Professional services1,580 1,744 2,072 7,822 7,049 
Amortization of intangible assets952 951 1,130 4,008 4,758 
Impairment on leased assets and surrendered assets7,601 — — 7,601 — 
FDIC insurance1,383 1,402 1,147 5,278 4,779 
Other expense8,820 6,906 5,211 29,969 21,606 
Total noninterest expense$54,183 $46,733 $44,488 $193,262 $173,902 
Income Tax Expense
Income tax benefit was $19.6 million for the fourth quarter of 2024, compared to expenses of $4.1 million for the third quarter of 2024 and $6.4 million for the fourth quarter of 2023. The resulting effective tax rates were 27.2%, 18.1% and 23.7%, respectively.
Capital
At December 31, 2024, Midland States Bank and the Company exceeded all regulatory capital requirements under Basel III, and Midland States Bank met the qualifications to be a ‘‘well-capitalized’’ financial institution, as summarized in the following table:
As of December 31, 2024
Midland States BankMidland States Bancorp, Inc.
Minimum Regulatory Requirements (2)
Total capital to risk-weighted assets12.75%13.38%10.50%
Tier 1 capital to risk-weighted assets11.54%11.11%8.50%
Common equity Tier 1 capital to risk-weighted assets11.54%8.37%7.00%
Tier 1 leverage ratio9.71%9.36%4.00%
Tangible common equity to tangible assets (1)
N/A6.14%N/A
(1) A non-GAAP financial measure. Refer to page 17 for a reconciliation to the comparable GAAP financial measure.
(2) Includes the capital conservation buffer of 2.5%, as applicable.
The impact of rising interest rates on the Company’s investment portfolio and cash flow hedges resulted in an accumulated other comprehensive loss of $82.0 million at December 31, 2024, which reduced tangible book value by $3.81 per share.


Stock Repurchase Program
As previously disclosed, on December 5, 2023, the Company’s board of directors authorized a new share repurchase program, pursuant to which the Company was authorized to repurchase up to $25.0 million of common stock through December 31, 2024. During the fourth quarter of 2024, the Company did not repurchased any shares of its common stock. The program terminated effective December 31, 2024.
About Midland States Bancorp, Inc.
Midland States Bancorp, Inc. is a community-based financial holding company headquartered in Effingham, Illinois, and is the sole shareholder of Midland States Bank. As of December 31, 2024, the Company had total assets of approximately $7.53 billion, and its Wealth Management Group had assets under administration of approximately $4.15 billion. The Company provides a full range of commercial and consumer banking products and services and business equipment financing, merchant credit card services, trust and investment management, insurance and financial planning services. For additional information, visit https://www.midlandsb.com/ or https://www.linkedin.com/company/midland-states-bank.
Non-GAAP Financial Measures
Some of the financial measures included in this press release are not measures of financial performance recognized in accordance with GAAP.
These non-GAAP financial measures include “Adjusted Earnings,” “Adjusted Earnings Available to Common Shareholders,” “Adjusted Diluted Earnings Per Common Share,” “Adjusted Return on Average Assets,” “Adjusted Return on Average Shareholders’ Equity,” “Adjusted Return on Average Tangible Common Equity,” “Adjusted Pre-Tax, Pre-Provision Earnings,” “Adjusted Pre-Tax, Pre-Provision Return on Average Assets,” “Efficiency Ratio,” “Tangible Common Equity to Tangible Assets,” “Tangible Book Value Per Share,” “Tangible Book Value Per Share excluding Accumulated Other Comprehensive Income,” and “Return on Average Tangible Common Equity.” The Company believes these non-GAAP financial measures provide both management and investors a more complete understanding of the Company’s funding profile and profitability. These non-GAAP financial measures are supplemental and are not a substitute for any analysis based on GAAP financial measures. Not all companies use the same calculation of these measures; therefore, the measures in this press release may not be comparable to other similarly titled measures as presented by other companies.
Forward-Looking Statements
Readers should note that in addition to the historical information contained herein, this press release includes "forward-looking statements" within the meanings of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including but not limited to statements about the Company’s plans, objectives, future performance, goals and future earnings levels. These statements are subject to many risks and uncertainties, including changes in interest rates and other general economic, business and political conditions, the impact of inflation, increased deposit volatility and potential regulatory developments; changes in the financial markets; changes in business plans as circumstances warrant; risks relating to acquisitions; changes to U.S. tax laws, regulations and guidance; and other risks detailed from time to time in filings made by the Company with the Securities and Exchange Commission. Readers should note that the forward-looking statements included in this press release are not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-


looking statements. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "will," "propose," "may," "plan," "seek," "expect," "intend," "estimate," "anticipate," "believe," "continue," or similar terminology. Any forward-looking statements presented herein are made only as of the date of this press release, and the Company does not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.
CONTACTS:
Jeffrey G. Ludwig, President and CEO, at jludwig@midlandsb.com or (217) 342-7321
Eric T. Lemke, Chief Financial Officer, at elemke@midlandsb.com or (217) 342-7321



MIDLAND STATES BANCORP, INC.
CONSOLIDATED FINANCIAL SUMMARY (unaudited)
As of and for the Three Months Ended
As of and
for the Years Ended
December 31,September 30,December 31, December 31,December 31,
(dollars in thousands, except per share data)20242024202320242023
Earnings Summary
Net interest income$56,035 $54,950 $58,077 $221,957 $236,017 
Provision for credit losses93,540 5,000 6,950 129,340 21,132 
Noninterest income19,561 19,339 20,513 77,743 66,590 
Noninterest expense54,183 46,733 44,488 193,262 173,902 
(Loss) income before income taxes(72,127)22,556 27,152 (22,902)107,573 
Income tax (benefit) expense(19,586)4,080 6,441 (9,472)32,113 
Net (loss) income(52,541)18,476 20,711 (13,430)75,460 
Preferred dividends2,228 2,229 2,228 8,913 8,913 
Net (loss) income available to common shareholders$(54,769)$16,247 $18,483 $(22,343)$66,547 
Diluted (loss) earnings per common share$(2.52)$0.74 $0.84 $(1.05)$2.97 
Weighted average common shares outstanding - diluted21,753,711 21,678,242 21,822,328 21,737,958 22,124,402 
(Loss) return on average assets(2.72)%0.95 %1.04 %(0.17)%0.95 %
(Loss) return on average shareholders' equity(25.91)%9.24 %10.74 %(1.69)%9.80 %
(Loss) return on average tangible common equity (1)
(41.76)%12.69 %15.41 %(4.40)%13.89 %
Net interest margin3.19 %3.10 %3.21 %3.15 %3.26 %
Efficiency ratio (1)
71.42 %62.76 %55.22 %64.31 %55.91 %
Adjusted Earnings Performance Summary (1)
Adjusted (loss) earnings available to common shareholders$(54,735)$16,223 $19,793 $(22,344)$76,576 
Adjusted diluted (loss) earnings per common share$(2.52)$0.74 $0.89 $(1.05)$3.42 
Adjusted (loss) return on average assets(2.72)%0.95 %1.11 %(0.17)%1.08 %
Adjusted (loss) return on average shareholders' equity(25.89)%9.23 %11.42 %(1.69)%11.10 %
Adjusted (loss) return on average tangible common equity(41.74)%12.67 %16.51 %(4.40)%15.98 %
Adjusted pre-tax, pre-provision earnings$21,460 $27,523 $35,898 $106,437 $136,303 
Adjusted pre-tax, pre-provision return on average assets1.11 %1.42 %1.80 %1.37 %1.72 %
Market Data
Book value per share at period end$29.10 $33.08 $31.61 
Tangible book value per share at period end (1)
$21.01 $24.90 $23.35 
Tangible book value per share excluding accumulated other comprehensive income at period end (1)
$24.82 $27.74 $26.91 
Market price at period end$24.40 $22.38 $27.56 
Common shares outstanding at period end21,494,485 21,393,905 21,551,402 
Capital
Total capital to risk-weighted assets13.38 %13.98 %13.20 %
Tier 1 capital to risk-weighted assets11.11 %11.65 %10.91 %
Common equity tier 1capital to risk-weighted assets8.37 %9.00 %8.40 %
Tier 1 leverage ratio9.36 %10.10 %9.71 %
Tangible common equity to tangible assets (1)
6.14 %7.03 %6.55 %
Wealth Management
Trust assets under administration$4,153,080 $4,268,539 $3,733,355 
(1) Non-GAAP financial measures. Refer to pages 15 - 17 for a reconciliation to the comparable GAAP financial measures.



MIDLAND STATES BANCORP, INC.
CONSOLIDATED FINANCIAL SUMMARY (unaudited) (continued)
As of
December 31,September 30,June 30,March 31,December 31,
(in thousands)20242024202420242023
Assets
Cash and cash equivalents$114,766 $121,873 $124,646 $167,316 $135,061 
Investment securities1,212,366 1,216,795 1,099,654 1,044,900 920,396 
Loans5,167,574 5,748,819 5,851,994 5,958,462 6,131,079 
Allowance for credit losses on loans(75,414)(85,804)(92,183)(78,057)(68,502)
Total loans, net5,092,160 5,663,015 5,759,811 5,880,405 6,062,577 
Loans held for sale346,565 8,001 5,555 5,043 3,811 
Premises and equipment, net85,710 84,672 83,040 81,831 82,814 
Other real estate owned6,413 8,646 8,304 8,920 9,112 
Loan servicing rights, at lower of cost or fair value17,842 18,400 18,902 19,577 20,253 
Goodwill161,904 161,904 161,904 161,904 161,904 
Other intangible assets, net12,100 13,052 14,003 15,019 16,108 
Company-owned life insurance211,168 209,193 207,211 205,286 203,485 
Other assets268,061 245,932 274,244 241,608 251,347 
Total assets$7,529,055 $7,751,483 $7,757,274 $7,831,809 $7,866,868 
Liabilities and Shareholders' Equity
Noninterest-bearing demand deposits$1,055,564 $1,050,617 $1,108,521 $1,212,382 $1,145,395 
Interest-bearing deposits5,141,679 5,206,219 5,009,502 5,111,602 5,164,134 
Total deposits6,197,243 6,256,836 6,118,023 6,323,984 6,309,529 
Short-term borrowings87,499 13,849 7,208 214,446 34,865 
FHLB advances and other borrowings258,000 425,000 600,000 255,000 476,000 
Subordinated debt77,749 82,744 91,656 93,617 93,546 
Trust preferred debentures51,205 51,058 50,921 50,790 50,616 
Other liabilities121,246 103,737 103,694 102,966 110,459 
Total liabilities6,792,942 6,933,224 6,971,502 7,040,803 7,075,015 
Total shareholders’ equity736,113 818,259 785,772 791,006 791,853 
Total liabilities and shareholders’ equity$7,529,055 $7,751,483 $7,757,274 $7,831,809 $7,866,868 



MIDLAND STATES BANCORP, INC.
CONSOLIDATED FINANCIAL SUMMARY (unaudited) (continued)
For the Three Months EndedFor the Years Ended
December 31,September 30,December 31, December 31,December 31,
(in thousands, except per share data)20242024202320242023
Net interest income:
Interest income$101,935 $104,834 $104,681 $411,739 $404,296 
Interest expense45,900 49,884 46,604 189,782 168,279 
Net interest income56,035 54,950 58,077 221,957 236,017 
Provision for credit losses on loans92,270 5,000 6,950 128,270 21,132 
Provision for credit losses on unfunded commitments1,270 — — 1,070 — 
Total provision for credit losses93,540 5,000 6,950 129,340 21,132 
Net interest income after provision for credit losses(37,505)49,950 51,127 92,617 214,885 
Noninterest income:
Wealth management revenue7,660 7,104 6,604 28,697 25,572 
Service charges on deposit accounts3,506 3,411 3,246 13,154 11,990 
Interchange revenue3,528 3,506 3,585 13,955 14,302 
Residential mortgage banking revenue637 697 451 2,418 1,903 
Income on company-owned life insurance1,975 1,982 1,753 7,683 4,439 
Loss on sales of investment securities, net(34)(44)(2,894)(230)(9,372)
Other income2,289 2,683 7,768 12,066 17,756 
Total noninterest income19,561 19,339 20,513 77,743 66,590 
Noninterest expense:
Salaries and employee benefits22,283 24,382 24,031 93,639 93,438 
Occupancy and equipment4,286 4,393 3,934 16,785 15,986 
Data processing7,278 6,955 6,963 28,160 26,286 
Professional services1,580 1,744 2,072 7,822 7,049 
Amortization of intangible assets952 951 1,130 4,008 4,758 
Impairment on leased assets and surrendered assets7,601 — — 7,601 — 
FDIC insurance1,383 1,402 1,147 5,278 4,779 
Other expense8,820 6,906 5,211 29,969 21,606 
Total noninterest expense54,183 46,733 44,488 193,262 173,902 
(Loss) income before income taxes(72,127)22,556 27,152 (22,902)107,573 
Income tax (benefit) expense(19,586)4,080 6,441 (9,472)32,113 
Net (loss) income(52,541)18,476 20,711 (13,430)75,460 
Preferred stock dividends2,228 2,229 2,228 8,913 8,913 
Net (loss) income available to common shareholders$(54,769)$16,247 $18,483 $(22,343)$66,547 
Basic (loss) earnings per common share$(2.52)$0.74 $0.84 $(1.05)$2.97 
Diluted (loss) earnings per common share$(2.52)$0.74 $0.84 $(1.05)$2.97 



MIDLAND STATES BANCORP, INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES (unaudited)
Adjusted Earnings Reconciliation
For the Three Months EndedFor the Years Ended
December 31,September 30,December 31, December 31,December 31,
(dollars in thousands, except per share data)20242024202320242023
(Loss) income before income tax (benefit) expense - GAAP$(72,127)$22,556 $27,152 $(22,902)$107,573 
Adjustments to noninterest income:
Loss on sales of investment securities, net34 44 2,894 230 9,372 
(Gain) on sale of Visa B shares— — (1,098)— (1,098)
Loss (gain) on repurchase of subordinated debt13 (77)— (231)(676)
Total adjustments to noninterest income47 (33)1,796 (1)7,598 
Adjusted (loss) earnings pre tax - non-GAAP(72,080)22,523 28,948 (22,903)115,171 
Adjusted (loss) earnings tax (benefit) expense(19,573)4,071 6,927 (9,472)29,682 
Adjusted (loss) earnings - non-GAAP(52,507)18,452 22,021 (13,431)85,489 
Preferred stock dividends2,228 2,229 2,228 8,913 8,913 
Adjusted (loss) earnings available to common shareholders$(54,735)$16,223 $19,793 $(22,344)$76,576 
Adjusted diluted (loss) earnings per common share$(2.52)$0.74 $0.89 $(1.05)$3.42 
Adjusted (loss) return on average assets(2.72)%0.95 %1.11 %(0.17)%1.08 %
Adjusted (loss) return on average shareholders' equity(25.89)%9.23 %11.42 %(1.69)%11.10 %
Adjusted (loss) return on average tangible common equity(41.74)%12.67 %16.51 %(4.40)%15.98 %
Adjusted Pre-Tax, Pre-Provision Earnings Reconciliation
For the Three Months EndedFor the Years Ended
December 31,September 30,December 31, December 31,December 31,
(dollars in thousands)20242024202320242023
Adjusted (loss) earnings pre tax - non-GAAP$(72,080)$22,523 $28,948 $(22,903)$115,171 
Provision for credit losses93,540 5,000 6,950 129,340 21,132 
Adjusted pre-tax, pre-provision earnings - non-GAAP$21,460 $27,523 $35,898 $106,437 $136,303 
Adjusted pre-tax, pre-provision return on average assets1.11 %1.42 %1.80 %1.37 %1.72 %



MIDLAND STATES BANCORP, INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES (unaudited)
Efficiency Ratio Reconciliation
For the Three Months EndedFor the Years Ended
December 31,September 30,December 31, December 31,December 31,
(dollars in thousands)20242024202320242023
Noninterest expense - GAAP$54,183 $46,733 $44,488 $193,262 $173,902 
Net interest income - GAAP$56,035 $54,950 $58,077 $221,957 $236,017 
Effect of tax-exempt income221 205 183 810 828 
Adjusted net interest income56,256 55,155 58,260 222,767 236,845 
Noninterest income - GAAP19,561 19,339 20,513 77,743 66,590 
Loss on sales of investment securities, net34 44 2,894 230 9,372 
(Gain) on sale of Visa B shares— — (1,098)— (1,098)
Loss (gain) on repurchase of subordinated debt13 (77)— (231)(676)
Adjusted noninterest income19,608 19,306 22,309 77,742 74,188 
Adjusted total revenue$75,864 $74,461 $80,569 $300,509 $311,033 
Efficiency ratio71.42 %62.76 %55.22 %64.31 %55.91 %
Return on Average Tangible Common Equity
For the Three Months EndedFor the Years Ended
December 31,September 30,December 31, December 31,December 31,
(dollars in thousands)20242024202320242023
Net (loss) income available to common shareholders$(54,769)$16,247 $18,483 $(22,343)$66,547 
Average total shareholders' equity—GAAP$806,707 $795,322 $764,790 $793,984 $770,095 
Adjustments:
Preferred Stock(110,548)(110,548)(110,548)(110,548)(110,548)
Goodwill(161,904)(161,904)(161,904)(161,904)(161,904)
Other intangible assets, net(12,551)(13,506)(16,644)(14,011)(18,376)
Average tangible common equity$521,704 $509,364 $475,694 $507,521 $479,267 
(Loss) return on average tangible common equity(41.76)%12.69 %15.41 %(4.40)%13.89 %



MIDLAND STATES BANCORP, INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES (unaudited) (continued)
Tangible Common Equity to Tangible Assets Ratio and Tangible Book Value Per Share
As of
December 31,September 30,June 30,March 31,December 31,
(dollars in thousands, except per share data)20242024202420242023
Shareholders' Equity to Tangible Common Equity
Total shareholders' equity—GAAP$736,113 $818,259 $785,772 $791,006 $791,853 
Adjustments:
Preferred Stock(110,548)(110,548)(110,548)(110,548)(110,548)
Goodwill(161,904)(161,904)(161,904)(161,904)(161,904)
Other intangible assets, net(12,100)(13,052)(14,003)(15,019)(16,108)
Tangible common equity451,561 532,755 499,317 503,535 503,293 
Less: Accumulated other comprehensive loss (AOCI)(81,960)(60,640)(82,581)(81,419)(76,753)
Tangible common equity excluding AOCI$533,521 $593,395 $581,898 $584,954 $580,046 
Total Assets to Tangible Assets:
Total assets—GAAP$7,529,055 $7,751,483 $7,757,274 $7,831,809 $7,866,868 
Adjustments:
Goodwill(161,904)(161,904)(161,904)(161,904)(161,904)
Other intangible assets, net(12,100)(13,052)(14,003)(15,019)(16,108)
Tangible assets$7,355,051 $7,576,527 $7,581,367 $7,654,886 $7,688,856 
Common Shares Outstanding21,494,485 21,393,905 21,377,215 21,485,231 21,551,402 
Tangible Common Equity to Tangible Assets6.14 %7.03 %6.59 %6.58 %6.55 %
Tangible Book Value Per Share$21.01 $24.90 $23.36 $23.44 $23.35 
Tangible Book Value Per Share, excluding AOCI$24.82 $27.74 $27.22 $27.23 $26.91 


1 Midland States Bancorp, Inc. NASDAQ: MSBI Fourth Quarter 2024 Earnings Presentation

 
22 Forward-Looking Statements. This presentation may contain forward-looking statements within the meaning of the federal securities laws. Forward-looking statements expressing management’s current expectations, forecasts of future events or long-term goals may be based upon beliefs, expectations and assumptions of the Company’s management, and are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “plan,” “intend,” “estimate,” “may,” “will,” “would,” “could,” “should” or other similar expressions. All statements in this presentation speak only as of the date they are made, and the Company undertakes no obligation to update any statement. A number of factors, many of which are beyond the ability of the Company to control or predict, could cause actual results to differ materially from those in its forward-looking statements including changes in interest rates and other general economic, business and political conditions, the impact of inflation, increased deposit volatility and potential regulatory developments. These risks and uncertainties should be considered in evaluating forward-looking statements, and undue reliance should not be placed on such statements. Additional information concerning the Company and its businesses, including additional factors that could materially affect the Company’s financial results, are included in the Company’s filings with the Securities and Exchange Commission. Use of Non-GAAP Financial Measures. This presentation may contain certain financial information determined by methods other than in accordance with accounting principles generally accepted in the United States (“GAAP”). These non-GAAP financial measures include “Adjusted Earnings,” "Adjusted Earnings Available to Common Shareholders," “Adjusted Diluted Earnings Per Common Share,” “Adjusted Return on Average Assets,” “Adjusted Return on Average Shareholders’ Equity,” “Adjusted Return on Average Tangible Common Equity,” “Adjusted Pre-Tax, Pre-Provision Earnings,” “Adjusted Pre-Tax, Pre-Provision Return on Average Assets,” “Efficiency Ratio,” “Tangible Common Equity to Tangible Assets,” “Tangible Book Value Per Share,” “Tangible Book Value Per Share excluding Accumulated Other Comprehensive Income,”and “Return on Average Tangible Common Equity.” The Company believes that these non-GAAP financial measures provide both management and investors a more complete understanding of the Company’s funding profile and profitability. These non-GAAP financial measures are supplemental and are not a substitute for any analysis based on GAAP financial measures. Not all companies use the same calculation of these measures; therefore this presentation may not be comparable to other similarly titled measures as presented by other companies. Reconciliations of these non-GAAP measures are provided in the Appendix section of this presentation.

 
33 Company Snapshot Financial Highlights as of December 31, 2024 $7.5 Billion Total Assets $5.2 Billion Total Loans $6.2 Billion Total Deposits $4.2 Billion Assets Under Administration YTD Adjusted ROAA(1): (0.17)% YTD Adjusted Return on TCE(1): (4.40)% TCE/TA: 6.14% YTD PTPP(1) ROAA: 1.37% Dividend Yield: 5.08% Price/Tangible Book: 1.16x Notes: (1) Represents a non-GAAP financial measure. See “Non-GAAP Reconciliation” in the appendix. Founded in 1881, this Illinois state- chartered community bank focuses on in-market relationships while having national diversification through equipment finance. • 53 Branches in Illinois and Missouri • 16 successful acquisitions since 2008

 
4 Overview of 4Q24 Financial Performance Proactive Credit Administration Actions and Loan Sales Successfully Growing Community Bank Positive Trends in Key Metrics 4 • Net loss available to common shareholders of ($54.8 million), or ($2.52) diluted EPS • Pre-tax, pre-provision earnings(1) of $21.5 million • Strong noninterest income of $19.6 million • Exited or agreed to exit portfolios with Lending Point and GreenSky • Key strategic decisions in loan portfolios to reduce credit risk going forward • Downgrade and charge-off of previously identified problem loans • Generally stable asset quality throughout remainder of the portfolio • Another good quarter of business development in community bank with full banking relationships added with high quality in-market clients • Community bank loans relatively stable during 4Q24, offset by intentional reduction of equipment finance and sale of non-core consumer portfolios • Loan portfolio continues to shift towards in-market C&I and CRE loans resulting in higher quality loan portfolio • Net interest margin expanded 9 bps to 3.19% • Wealth management revenue increased due to impact of new wealth advisors added in 2024 • Increased liquidity with loan-to-deposit ratio decreasing to 83.4% from 91.9% at the end of the prior quarter Notes: (1) Represents a non-GAAP financial measure. See “Non-GAAP Reconciliation” in the appendix.

 
5 Targeted Credit Management Efforts Addressing Credit Metrics to Improve Earnings & Liquidity in 2025 Non-Core Consumer Loans Specialty Finance Group Midland Equipment Finance Total NCOs: $52.6M Total NCOs: $25.2M Total NCOs: $15.3M Financial ImpactAction Overview • Strategic decision to exit these portfolios • Sold 100% of $87.1M LendingPoint portfolio with proceeds to reduce wholesale funding at a loss of $17.3M • Committed to sell $371.7M Greensky portfolio at a loss of $33.4M to close in Q1’25 (89% of the portfolio) • Portfolio originated by FinTech partners LendingPoint & Greensky • Unsecured portfolios which have exhibited increasing delinquencies & deterioration • Nationwide portfolio providing bridge loan financing for commercial real estate • Primarily multifamily and healthcare • Impacted by macroeconomic factors resulting in elevated NPLs • Strategic review resulted in downgrades and charge-offs • Moved $57.8M to non-performing from substandard & recorded $6.6M in NCOs • Updated appraisals received resulted in $18.8M in NCOs • Stopped future origination of construction/rehab • Loans & leases for customers across the U.S. • Deterioration has been experienced primarily in the trucking industry • Tightened underwriting standards to eliminate new trucking contracts, refocus on higher quality segments • Evaluated equipment values for nonaccrual assets resulting in charge-offs of $15.3M • Adjusted valuations on repossessed equipment and equipment on operating leases resulting in $7.6M impairment Impairment Losses: $7.6M Impairment Losses: $2.1M

 
6 Capital Ratios and Strategy 6 • Capital initiatives result in capital levels consistent with prior years • Internal capital generated from strong profitability and slower balance sheet growth expected to raise CET1 ratio to 9.25-9.50% by the end of 2025 • Capital actions and strong profitability expected to enable MSBI to raise capital ratios while maintaining current dividend payout Consolidated Capital Ratios (as of December 31, 2024 & 2023) 11.54% 9.71% 11.54% 12.75% 11.44% 10.18% 11.44% 12.40% 2024 2023 Common Eq. Tier 1 Tier 1 Leverage Tier 1 RBC Total RBC 6.14% 8.37% 9.36% 11.11% 13.38% 6.55% 8.40% 9.71% 10.91% 13.20% 2024 2023 TCE/TA Common Eq. Tier 1 Tier 1 Leverage Tier 1 RBC Total RBC Bank Capital Ratios (as of December 31, 2024 & 2023)

 
7 Liquidity Overview 7 Liquidity Sources (in millions) December 31, 2024 September 30, 2024 Cash and Cash Equivalents $ 114.8 $ 121.9 Unpledged Securities 672.4 532.8 FHLB Committed Liquidity 1,290.2 1,086.3 FRB Discount Window Availability 538.8 552.8 Total Estimated Liquidity $ 2,616.2 $ 2,293.8 Conditional Funding Based on Market Conditions Additional Credit Facility $ 360.0 $ 433.0 Brokered CDs (additional capacity) $ 350.0 $ 350.0 • Continue to see improvements in its committed liquidity capacity quarter over quarter and year over year • Internal guideline for additional brokered deposit capacity limited to 10% of total deposits

 
8 Loan Portfolio 8 • Total loans decreased $581.2 million from prior quarter to $5.17 billion • Decrease primarily driven by sale of Lending Point portfolio, transferring GreenSky portfolio to held for sale and the continual intentional decline in equipment finance portfolio • Decrease in non-core portfolios partially offset by new loan production from high quality commercial clients that provide full banking relationships • Investments made to increase business development efforts in St. Louis resulted in total loans increasing at an annualized rate of 8% during 4Q24 in this market Loan Portfolio Mix (in millions, as of quarter-end) 4Q 2024 3Q 2024 4Q 2023 Commercial loans and leases $ 1,738 $ 1,773 $ 1,956 Commercial real estate 2,592 2,510 2,407 Construction and land development 300 422 453 Residential real estate 381 379 381 Consumer 157 663 935 Total Loans $ 5,168 $ 5,749 $ 6,131 Total Loans ex. Commercial FHA Lines $ 5,160 $ 5,699 $ 6,131 $6,131 $5,958 $5,852 $5,749 $5,168 6.00% 5.99% 6.03% 6.15% 6.04% Total Loans Average Loan Yield 4Q 2023 1Q 2024 2Q 2024 3Q 2024 4Q 2024 Total Loans and Average Loan Yield (in millions, as of quarter-end)

 
9 Loan Segments 9 • Total loans in our Community Bank increased $24 million from prior quarter to $3.20 billion • Loans in St. Louis region increased $18 million or 8% annualized in 4Q24 • Focused on core, in-market loan relationships • Continuing to add talent in faster growing markets to drive quality loan relationships and commercial deposits Loan Portfolio Segments (in millions, as of quarter-end) 4Q 2024 3Q 2024 4Q 2023 Regions: Eastern $ 900 $ 903 $ 855 Northern 715 731 728 Southern 720 695 731 St. Louis 868 850 774 Community Bank $ 3,203 $ 3,179 $ 3,088 Other: FHA Warehouse Line $ 8 $ 50 $ — Specialty Finance 1,038 1,003 1,114 Equipment Finance 808 860 1,004 Non-Core Consumer(1) and other 111 657 925 Total Loans $ 5,168 $ 5,749 $ 6,131 Loan Segment Mix Community Bank, 61.5% Specialty Finance, 19.9% Equipment Finance, 15.5% BaaS, 2.1% FHA Warehouse, 1.0% Notes: (1) includes loans originated through Greensky relationship

 
10 Total Deposits 10 • Total deposits decreased $59.6 million from prior quarter, primarily due to decreases in higher cost time deposits • Impact of new commercial deposit relationships offset seasonal outflow of commercial deposits resulting in a slight increase in noninterest-bearing demand deposits from end of prior quarter • Stable deposit mix and lower interest rates resulted in 17 basis point decline in cost of deposits Deposit Mix (in millions, as of quarter-end) 4Q 2024 3Q 2024 4Q 2023 Noninterest-bearing demand $ 1,056 $ 1,051 $ 1,145 Interest-bearing: Checking 2,378 2,390 2,512 Money market 1,174 1,187 1,136 Savings 507 510 559 Time 823 849 863 Brokered time 260 269 95 Total Deposits $ 6,197 $ 6,257 $ 6,310 $6,310 $6,324 $6,118 $6,257 $6,197 2.41% 2.49% 2.55% 2.69% 2.52% Total Deposits Cost of Deposits 4Q 2023 1Q 2024 2Q 2024 3Q 2024 4Q 2024 Total Deposits and Cost of Deposits (in millions, as of quarter-end)

 
11 Deposit Summary 11 Deposits by Channel (in millions, as of quarter-end) 4Q 2024 3Q 2024 4Q 2023 Retail $ 2,750 $ 2,695 $ 2,758 Commercial 1,210 1,219 1,392 Public Funds 506 574 569 Wealth & Trust 341 332 322 Servicing 896 959 952 Brokered Deposits 473 391 210 Other 21 87 107 Total Deposits $ 6,197 $ 6,257 $ 6,310 $6,310 $6,324 $6,118 $6,257 $6,197 Retail Commercial Public Funds Wealth & Trust Servicing Brokered Deposits Other 4Q 2023 1Q 2024 2Q 2024 3Q 2024 4Q 2024 • Retail and commercial deposits remained relatively stable to slightly positive from prior quarter • Public funds and servicing deposits decreased $68 and $63 million due to seasonal factors • Total brokered deposits increased $82 million in 4Q24, limiting reliance on FHLB Advances • Interest rates will decrease for servicing and brokered deposits, reducing pressure on cost of funds Trend of Deposit Channel Mix (in millions, as of quarter-end)

 
12 1.7% 70.1% 8.4% 5.7% 6.6% 7.5% US GSE & US Agency MBS - agency MBS - non agency State & Muni Corporate Other Investment Portfolio As of December 31, 2024 12 Fair Value of Investments by Type • All Investments are classified as Available for Sale • Average T/E Yield is 4.73% for 4Q24 • Average Duration is 4.87 years • Purchased $119 million with T/E Yield of 5.42% and sold $15 million with T/E floating Yield of 5.54% in 4Q24 Investments by Yield and DurationInvestment Mix & Unrealized Gain (Loss) (in millions) Fair Value Book Value Unrealized Gain (Loss) US GSE & US Agency $ 20 $ 22 $ (2) MBS - agency 847 940 (93) MBS - non agency 101 103 (2) State & Municipal 69 76 (7) Corporate 80 87 (7) Other 90 90 — Total Investments $ 1,208 $ 1,317 $ (109) Duration Y ie ld -1 0 1 2 3 4 5 6 7 8 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% $1.21 billion

 
13 3.21% 3.18% 3.12% 3.10% 3.19% 4Q 2023 1Q 2024 2Q 2024 3Q 2024 4Q 2024 $58.1 $55.9 $55.1 $55.0 $56.0 4Q 2023 1Q 2024 2Q 2024 3Q 2024 4Q 2024 Net Interest Income/Margin 13 • Net interest income increased from prior quarter due to expanded net interest margin • Net interest margin increased 9 bp to 3.19% as the decrease in the average cost of deposits exceeded the decrease in the average yield on earning assets • Average rate on new and renewed loan originations was 7.14% in 4Q24 and higher than average rates on loan payoffs making them accretive to net interest margin • Successfully reducing deposit rates and maintaining stable deposit balances Net Interest Income (in millions) Net Interest Margin

 
14 Loans & Securities - Repricing and Maturity 14 Total Loans and Leases (net of unearned income)(1) (in millions) As of December 31, 2024 Repricing Term Rate Structure 3 mos or less 3-12 mos 1-3 years 3-5 years 5-10 years 10-15 years Over 15 years Total Floating Rate Adjustable Rate Fixed Rate Commercial loans and leases $ 749 $ 248 $ 524 $ 184 $ 28 $ 4 $ 1 $ 1,738 $ 599 $ 74 $ 1,065 Commercial real estate 943 353 771 371 139 14 1 2,592 625 250 1,717 Construction and land development 207 31 49 12 1 — — 300 163 3 134 Residential real estate 68 41 52 56 59 34 71 381 55 108 218 Consumer 17 39 71 21 9 — — 157 3 — 154 Total $ 1,984 $ 712 $ 1,467 $ 644 $ 236 $ 52 $ 73 $ 5,168 $ 1,445 $ 435 $ 3,288 % of Total 38 % 14 % 28 % 12 % 5 % 1 % 1 % 100 % 28 % 8 % 64 % Weighted Average Rate 6.84 % 5.62 % 5.31 % 5.90 % 4.70 % 4.48 % 4.75 % 5.95 % 7.53 % 4.99 % 5.44 % Investment Securities Available for Sale(2) (in millions) As of December 31, 2024 Maturity & Projected Cash Flow Distribution 1 year or less 1-3 years 3-5 years 5-10 years Over 10 years Total Amortized Cost $ 158 $ 199 $ 220 $ 347 $ 391 $ 1,317 % of Total 12 % 15 % 17 % 26 % 30 % 100 % Notes: (1) Based on projected principal payments for all loans plus the next reset for floating and adjustable rate loans and the maturity date of fixed rate loans. (2) Projected principal cash flows for securities. Differences between amortized cost and total principal are included in Over 10 years.

 
15 Wealth Management 15 • Assets under administration decreased $116 million mainly due to market performance and resolution of estates and trusts • Wealth Management fees increased due to additional trust and estate fees collected in the quarter • Continual hiring of wealth advisors positively impacting new business development Assets Under Administration (in millions) $3,733 $3,888 $3,996 $4,269 $4,153 4Q 2023 1Q 2024 2Q 2024 3Q 2024 4Q 2024 $6.60 $7.13 $6.80 $7.10 $7.66 4Q 2023 1Q 2024 2Q 2024 3Q 2024 4Q 2024 Wealth Management Revenue (in millions)

 
16 $20.5 $21.2 $17.7 $19.3 $19.6 Wealth Management Interchange Service Charges on Deposits Residential Mortgage All Other 4Q 2023 1Q 2024 2Q 2024 3Q 2024 4Q 2024 Noninterest Income 16 • Noninterest income increased from prior quarter. • Wealth Management revenue was $0.6 million higher from additional trust and estate fees • Service charges and interchange revenue increased $0.1 million in the current quarter • Income from limited partnership investments decreased $0.3 million • Fee income expected to be $19.0 - $19.5 million in the near-term quarters Noninterest Income (in millions)

 
17 $44.5 $44.9 $47.5 $46.7 $54.2 55.2% 58.0% 65.2% 62.8% 71.4% Noninterest Expense Efficiency Ratio 4Q 2023 1Q 2024 2Q 2024 3Q 2024 4Q 2024 Noninterest Expense and Operating Efficiency 17 Noninterest Expense and Efficiency Ratio (1) (Noninterest expense in millions) • Efficiency Ratio (1) was 71.4% in 4Q 2024 vs. 62.8% in 3Q 2024 • 4Q24 Noninterest Expenses includes: ◦ $7.6 million MEF impairment on operating lease collateral and surrendered equipment ◦ $2.1 million OREO impairment • Near-term operating expense run- rate expected to be approximately $48.5 - $49.0 million Notes: (1) Represents a non-GAAP financial measure. See “Non-GAAP Reconciliation” in the appendix.

 
18 Asset Quality 18 • Nonperforming loans increased from prior quarter • Net charge-offs to average loans was 7.23% driven by non-core consumer, equipment finance and specialty finance portfolios • Taking steps to improve asset quality through focus on relationship lending and tighter credit standards • Focus on reducing non-performing loans in 2025 Nonperforming Loans / Total Loans (Total Loans as of quarter-end) NCO / Average Loans 0.68% 1.49% 1.56% 1.55% 2.49% 0.24% 0.27% 0.36% 0.37% 0.22% 0.07% 0.92% 1.76% 1.92% 1.99% 2.71% LendingPoint Equipment Finance All other 4Q 2023 1Q 2024 2Q 2024 3Q 2024 4Q 2024 0.33% 0.30% 0.20% 0.78% 7.23% 2.45% 1.07% 1.35% 2.36% Greensky LendingPoint Equipment Finance All other 4Q 2023 1Q 2024 2Q 2024 3Q 2024 4Q 2024

 
19 ACL by Portfolio 19 ($ in thousands) December 31, 2024 September 30, 2024 Portfolio Loans Net Charge-offs ACL ACL % of Total Loans Loans Net Charge-offs ACL ACL % of Total Loans Commercial $ 818,496 $ 9,353 $ 8,675 1.06 % $ 797,318 $ 14 $ 9,263 1.16 % Commercial Other 528,407 8,347 11,987 2.27 % 559,354 1,993 14,844 2.65 % Equipment Finance Loans 416,969 7,913 11,542 2.77 % 442,552 1,979 11,236 2.54 % Equipment Finance Leases 391,390 7,369 14,480 3.70 % 417,531 2,896 13,724 3.29 % CRE non-owner occupied 1,628,961 3,074 15,589 0.96 % 1,630,930 — 13,623 0.84 % CRE owner occupied 440,806 — 4,110 0.93 % 455,101 32 5,017 1.10 % Multi-family 454,249 6,083 5,818 1.28 % 355,988 (2) 3,619 1.02 % Farmland 67,648 115 224 0.33 % 68,453 — 269 0.39 % Construction and Land Development 299,842 17,991 3,550 1.18 % 422,253 (2) 12,061 2.86 % Residential RE First Lien 315,775 595 7,382 2.34 % 315,634 12 4,738 1.50 % Other Residential 64,782 (79) 601 0.93 % 63,023 85 614 0.97 % Consumer 96,202 100 495 0.51 % 90,626 5 531 0.59 % Consumer Other(1) 61,016 49,712 2,503 4.10 % 572,608 6,346 7,501 1.31 % Total Loans $ 5,167,574 $ 102,660 $ 75,414 1.46 % $ 5,748,819 $ 11,379 $ 85,804 1.49 % Notes: (1) Primarily consists of loans originated through GreenSky relationship

 
20 2025 Outlook and Priorities 20 • The Company has made several key strategic decisions to improve credit quality and forward earnings: ◦ To focus on in-market lending opportunities with full relationships ◦ A more conservative underwriting criteria for the Specialty Finance Group and Equipment Finance ◦ Exiting non-core consumer lending portfolios • These decisions position us for lower credit risk going forward • Capital, liquidity, and reserves are well positioned • Prudent risk management will remain top priority with business development efforts focused on adding new commercial and retail relationships throughout our markets • Capitalizing on market disruption resulting from M&A to add new clients and banking talent • Well positioned to benefit from lower interest rates with lower funding costs expected to lead to expanded net interest margin • Positive trends in key areas should lead to improved financial performance in 2025 * Continued disciplined expense management while making investments in the business to increase market share, add clients, and generate profitable growth in the future * Wealth Management revenue trending higher due to contributions of new advisors * BaaS initiative continuing to seek high quality FinTech partners

 
21 APPENDIX 21

 
2222 Industries as a percentage of Commercial, CRE and Equipment Finance Loans and Leases with outstanding balances of $4.63 billion as of December 31, 2024 ($s in millions) RE/Rental & Leasing $1,664.3 35.9% All Others $530.1 11.5% Skilled Nursing $403.7 8.7% Construction - General $302.2 6.5% Manufacturing $242.4 5.2% Finance and Insurance $226.9 4.9% Accommodation & Food Svcs $313.2 6.8% Trans./Ground Passenger $159.9 3.5% Assisted Living $100.0 2.2% Ag., Forestry, & Fishing $150.6 3.3% General Freight Trucking $154.7 3.3% Retail Trade $168.6 3.6% Wholesale Trade $57.4 1.2% Other Services $101.0 2.2% Commercial Loans and Leases by Industry Health Care $54.7 1.2%

 
23 Commercial Real Estate Portfolio by Collateral Type 23 CRE Concentration (as of December 31, 2024) CRE as a % of Total Loans 56.0% CRE as a % of Total Risk-Based Capital (1) 285.3% Notes: (1) Represents non-owner occupied CRE loans only Collateral type as a percentage of the Commercial Real Estate and Construction Portfolio with outstanding balances of $2.89 billion as of December 31, 2024 ($s in millions) Skilled Nursing $400.9 13.9% Retail $460.3 15.9% Multi-Family $547.0 18.9% Industrial/Warehouse $235.7 8.2% Assisted Living $120.7 4.2% Hotel/Motel $228.8 7.9% All Other $157.8 5.5% Office $146.3 5.1% Farmland $66.4 2.3% Residential 1-4 Family $90.2 3.1% Raw Land $23.1 0.8% Restaurant $31.5 1.1% Mixed Use/Other $107.1 3.7% Medical Building $80.6 2.8% Special Purpose $130.2 4.5% C-Store/Gas Station $65.0 2.2%

 
2424 MIDLAND STATES BANCORP, INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES (unaudited) Efficiency Ratio Reconciliation For the Quarter Ended December 31, September 30, June 30, March 31, December 31, 2024 2024 2024 2024 2023 (dollars in thousands) Noninterest expense - GAAP $ 54,183 $ 46,733 $ 47,479 $ 44,867 $ 44,488 Net interest income - GAAP $ 56,035 $ 54,950 $ 55,052 $ 55,920 $ 58,077 Effect of tax-exempt income 221 205 170 215 183 Adjusted net interest income 56,256 55,155 55,222 56,135 58,260 Noninterest income - GAAP 19,561 19,339 17,656 21,187 20,513 Loss on sales of investment securities, net 34 44 152 — 2,894 (Gain) on sale of Visa B shares — — — — — Loss (gain) on repurchase of subordinated debt 13 (77) (167) — — Adjusted noninterest income 19,608 19,306 17,641 21,187 22,309 Adjusted total revenue $ 75,864 $ 74,461 $ 72,863 $ 77,322 $ 80,569 Efficiency ratio 71.42 % 62.76 % 65.16 % 58.03 % 55.22 %

 
v3.24.4
Cover
Jan. 23, 2025
Cover [Abstract]  
Document Type 8-K
Document Period End Date Jan. 23, 2025
Entity Registrant Name Midland States Bancorp, Inc.
Entity Incorporation, State or Country Code IL
Entity File Number 001-35272
Entity Tax Identification Number 37-1233196
Entity Address, Address Line One 1201 Network Centre Drive
Entity Address, City or Town Effingham
Entity Address, State or Province IL
Entity Address, Postal Zip Code 62401
City Area Code 217
Local Phone Number 342-7321
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company false
Amendment Flag false
Entity Central Index Key 0001466026
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