First Mid Bancshares (FMBH) Q2 2024 earnings summary

Executive summary

• Net income for the six months ended June 30, 2024 was $40.2 million, with Q2 net income at $19.7 million and adjusted net income at $20.1 million; diluted EPS was $1.68 for the half and $0.82 for Q2.

• Margin expansion and diversified loan growth contributed to higher net interest income, supported by the Blackhawk Bank and MRIG acquisitions.

• Non-interest income increased, driven by insurance commissions, Blackhawk Bank customer activity, and the MRIG acquisition.

• Non-interest expense rose due to acquisition-related costs and amortization.

• Quarterly dividend increased by $0.01 to $0.24 per share.

Financial highlights

• Net interest income before provision for loan losses was $112.2 million for the first half of 2024, up from $85.6 million year-over-year; Q2 net interest income rose $1.3 million sequentially and $14.4 million year-over-year.

• Net interest margin (tax equivalent) rose to 3.36% in Q2, up from 2.89% year-over-year.

• Total loans ended at $5.56 billion, up $61.3 million from prior quarter; net loan balances decreased by $22.4 million for the half.

• Noninterest income was $22.4 million in Q2, up 15.1% year-over-year, and $46.9 million for the half, up 11.8%.

• Noninterest expense was $104.8 million for the half, up 28.4%, and $51.4 million in Q2, up $11.3 million year-over-year.

• Provision for credit losses was $726,000 for the half; net charge-offs were $1.09 million.

• Total nonperforming loans were $19.1 million at June 30, 2024, up slightly from $18.6 million a year ago.

Outlook and guidance

• Management expects continued strong capital and liquidity positions, with regulatory capital ratios above well-capitalized standards.

• Lower Illinois tax rate expected going forward due to legislative changes, though Q2 included a $1.0 million nonrecurring tax expense.

• MRIG acquisition anticipated to drive further noninterest income growth and deepen customer relationships.

• The company continues to monitor credit quality, interest rate risk, and economic conditions, especially in agriculture and commercial real estate.