MidWestOne Financial Group, Inc. Reports Financial Results For the First Quarter of 2025

IOWA CITY, Iowa, April 24, 2025 (GLOBE NEWSWIRE) -- MidWestOne Financial Group, Inc. (Nasdaq: MOFG) ("we," "our," or the "Company") today reported results for the first quarter of 2025. First Quarter 2025 Summary1 Net income of $15.1 million, or $0.73 per diluted common share. Net interest margin (tax equivalent) was 3.44%;2 core net interest margin expanded 10 basis points ("bps") to 3.36%.2Noninterest expenses were $36.3 million; efficiency ratio was 59.38%.2Return on average assets of 1.00%. Criticized loans ratio improved 54 bps to 5.47%; nonperforming assets ratio improved 7 bps to 0.33%.Tangible book value per share of $23.36,2 an increase of 4.4%.Common equity tier 1 ("CET1") capital ratio improved 24 bps to 10.97%. CEO Commentary Charles (Chip) Reeves, Chief Executive Officer of the Company, commented, "We are pleased with the continued execution of our strategic plan initiatives despite a more uncertain economic environment. Our return on average assets eclipsed 1% for the second straight quarter driven by disciplined balance sheet management, core net interest margin expansion of 10 bps2 and solid expense control. Loan growth was flat in the quarter, somewhat softer than anticipated, due to pay-offs and latter quarter market volatility. The majority of our asset quality metrics improved significantly, led by reductions in nonperforming assets and criticized loans. Net charge-offs increased to 29 basis points, with the majority of the increase due to a partial charge-off on a previously reserved CRE loan as we prepare for resolution. Driven by earnings and lower accumulated other comprehensive loss, tangible book value per share increased 4.4% to $23.362 and the CET1 ratio grew to 10.97%, edging closer to our target range of 11.0%-11.50%. Thank you to our team members who continued to execute well and serve our customers amidst market volatility. We are pleased with the transformation of our company and our solid foundation of increased capital, earnings power, asset quality, and a premium core deposit franchise position us well for uncertain economic times and the remainder of 2025.” 1 First Quarter Summary compares to the fourth quarter of 2024 (the "linked quarter") unless noted.2 Non-GAAP measure. See the separate Non-GAAP Measures section for a reconciliation to the most directly comparable GAAP measure. As of or for the quarter ended(Dollars in thousands, except per share amounts and as noted) March 31, December 31, March 31, 2025 2024 2024 Financial Results Revenue $57,575 $59,775 $44,481 Credit loss expense 1,687 1,291 4,689 Noninterest expense 36,293 37,372 35,565 Net income 15,138 16,330 3,269 Adjusted earnings(3) 15,301 16,112 4,504 Per Common Share Diluted earnings per share $0.73 $0.78 $0.21 Adjusted earnings per share(3) 0.73 0.77 0.29 Book value 27.85 26.94 33.53 Tangible book value(3) 23.36 22.37 27.14 Balance Sheet & Credit Quality Loans In millions $4,304.2 $4,315.6 $4,414.6 Investment securities In millions 1,305.5 1,328.4 1,862.2 Deposits In millions 5,489.1 5,478.0 5,585.2 Net loan charge-offs In millions 3.1 0.7 0.2 Allowance for credit losses ratio 1.25% 1.28% 1.27%Selected Ratios Return on average assets 1.00% 1.03% 0.20%Net interest margin, tax equivalent(3) 3.44% 3.43% 2.33%Return on average equity 10.74% 11.53% 2.49%Return on average tangible equity(3) 13.75% 14.80% 4.18%Efficiency ratio(3) 59.38% 59.06% 71.28% REVENUE REVIEW Revenue Change Change 1Q25 vs 1Q25 vs(Dollars in thousands) 1Q25 4Q24 1Q24 4Q24 1Q24Net interest income $ 47,439 $ 48,938 $ 34,731 (3)% 37%Noninterest income 10,136 10,837 9,750 (6)% 4%Total revenue, net of interest expense $ 57,575 $ 59,775 $ 44,481 (4)% 29% Total revenue for the first quarter of 2025 decreased $2.2 million from the fourth quarter of 2024 due to lower net interest income and noninterest income during the quarter. When compared to the first quarter of 2024, total revenue increased $13.1 million, due to higher net interest income and higher noninterest income. Net interest income of $47.4 million for the first quarter of 2025 decreased $1.5 million from the fourth quarter of 2024, due to lower earning asset volumes and yields, partially offset by lower funding volumes and costs. When compared to the first quarter of 2024, net interest income increased $12.7 million, due to higher earning asset yields and lower funding volumes and costs, partially offset by lower earning asset volumes. The Company's tax equivalent net interest margin was 3.44%3 in the first quarter of 2025, compared to 3.43%3 in the fourth quarter of 2024, driven by lower funding costs, partially offset by a decline in earning asset yields. Interest bearing liability costs during the first quarter of 2025 decreased 11 bps to 2.41%, due to reductions of short-term borrowings, interest bearing deposits, and long-term debt costs of 78 bps, 10 bps, and 7 bps, to 3.75%, 2.31%, and 6.41%, respectively, from the fourth quarter of 2024. The Company's tax equivalent net interest margin was 3.44%3 in the first quarter of 2025, compared to 2.33%3 in the first quarter of 2024, driven by higher earning asset yields and lower interest-bearing liability costs. Total earning assets yield increased 79 bps from the first quarter of 2024, primarily due to increases of 192 bps and 20 bps in total investment securities and loan yields, respectively. Interest bearing liability costs decreased 34 bps to 2.41%, due to short-term borrowing costs of 3.75%, long-term debt costs of 6.41%, and interest-bearing deposit costs of 2.31%, which decreased 107 bps, 45 bps, and 14 bps, respectively, from the first quarter of 2024. 3 Non-GAAP measure. See the separate Non-GAAP Measures section for a reconciliation to the most directly comparable GAAP measure. Noninterest Income Change Change 1Q25 vs 1Q25 vs(In thousands)1Q25 4Q24 1Q24 4Q24 1Q24Investment services and trust activities$3,544 $3,779 $3,503 (6)% 1%Service charges and fees 2,131 2,159 2,144 (1)% (1)%Card revenue 1,744 1,833 1,943 (5)% (10)%Loan revenue 1,194 1,841 856 (35)% 39%Bank-owned life insurance 1,057 719 660 47% 60%Investment securities gains, net 33 161 36 (80)% (8)%Other 433 345 608 26% (29)%Total noninterest income$10,136 $10,837 $9,750 (6)% 4% MSR adjustment (included above in Loan revenue)$(213) $164 $(368) (230)% (42)% Noninterest income for the first quarter of 2025 decreased $0.7 million from the linked quarter, primarily due to declines of $0.6 million and $0.2 million in loan revenue and investment services and trust activities revenue, respectively. The decrease in loan revenue was reflective of an unfavorable change in the fair value of our mortgage servicing rights of $0.4 million, coupled with a decrease in Small Business Administration ("SBA") gain on sale revenue of $0.3 million. The decrease in investment services and trust activities revenue was driven by a decline in assets under administration due to market volatility. Partially offsetting these decreases was an increase of $0.3 million in bank-owned life insurance revenue, due primarily to $0.4 million of death benefit recognized in the first quarter of 2025. Noninterest income for the first quarter of 2025 increased $0.4 million from the first quarter of 2024 due primarily to increases of $0.4 million and $0.3 million in bank-owned life insurance and loan revenue, respectively. The bank-owned life insurance increase was due primarily to the death benefit noted above. The increase in loan revenue was due primarily to the mortgage servicing right valuation adjustment, coupled with higher SBA gain on sale revenue and other loan income. Partially offsetting these increases were decreases of $0.2 million in each of card revenue and other revenue. EXPENSE REVIEW Noninterest Expense Change Change 1Q25 vs 1Q25 vs(In thousands)1Q25 4Q24 1Q24 4Q24 1Q24Compensation and employee benefits$21,212 $20,684 $20,930 3% 1%Occupancy expense of premises, net 2,588 2,772 2,813 (7)% (8)%Equipment 2,426 2,688 2,600 (10)% (7)%Legal and professional 2,226 2,534 2,059 (12)% 8%Data processing 1,698 1,719 1,360 (1)% 25%Marketing 552 793 598 (30)% (8)%Amortization of intangibles 1,408 1,449 1,637 (3)% (14)%FDIC insurance 917 980 942 (6)% (3)%Communications 159 154 196 3% (19)%Foreclosed assets, net 74 56 358 32% (79)%Other 3,033 3,543 2,072 (14)% 46% Total noninterest expense$36,293 $37,372 $35,565 (3)% 2% Merger-related Expenses (In thousands)1Q25 4Q24 1Q24Compensation and employee benefits$ — $ — $ 241Occupancy expense of premises, net — — 152Equipment — 21 149Legal and professional 40 — 573Data processing — 10 61Marketing — — 32Communications — — 1Other — — 105Total merger-related expenses$ 40 $ 31 $ 1,314 Noninterest expense for the first quarter of 2025 decreased $1.1 million from the linked quarter, primarily due to decreases in other noninterest expense, legal and professional, equipment, and occupancy expense of premises, net, of $0.5 million, $0.3 million, $0.3 million, and $0.2 million, respectively. The primary drivers of the decrease in other noninterest expense were declines in fraud loss expense of $0.3 million and customer deposit costs of $0.1 million. The $0.3 million decrease in legal and professional expense was primarily driven by lower litigation-related legal costs. The decrease in equipment of $0.3 million was primarily driven by fewer small equipment purchases, while the decrease in occupancy expense of premises, net was due primarily to lower property tax expense. Partially offsetting these decreases was an increase of $0.5 million in compensation and employee benefits which reflected an increase in equity compensation and payroll tax expenses. Noninterest expense for the first quarter of 2025 increased $0.7 million from the first quarter of 2024 primarily due to increases in other noninterest expense, data processing, and compensation and employee benefits of $1.0 million, $0.3 million and $0.3 million, respectively. The increase in other noninterest expense was due primarily to customer deposit costs while the increase in data processing was driven core banking system costs. The increase in compensation and employee benefits was primarily driven by medical benefits expenses, wages expense, and incentive expense due to improved performance. Partially offsetting these identified increases was a decline of $1.3 million in merger-related expenses. The Company's effective tax rate was 22.7% in the first quarter of 2025 and the linked quarter. The effective income tax rate for the full year 2025 is expected to be 22-23%. BALANCE SHEET REVIEW Total assets were $6.25 billion at March 31, 2025, compared to $6.24 billion at December 31, 2024 and $6.75 billion at March 31, 2024. The increase from December 31, 2024 was primarily due to higher cash balances, partially offset by lower securities balances. Compared to March 31, 2024, the decrease was primarily driven by the sale of assets associated with our Florida banking operations in the second quarter of 2024 coupled with the pay-off of Bank Term Funding Program ("BTFP") borrowings with proceeds received from securities sales transactions in the fourth quarter of 2024. Loans Held for InvestmentMarch 31, 2025 December 31, 2024 March 31, 2024 (Dollars in thousands)Balance % of Total Balance % of Total Balance % of Total Commercial and industrial$1,140,138 26.5%$1,126,813 26.1%$1,105,718 25.0%Agricultural131,409 3.1 119,051 2.8 113,029 2.6 Commercial real estate Construction and development293,280 6.8 324,896 7.5 403,571 9.1 Farmland180,633 4.2 182,460 4.2 184,109 4.2 Multifamily421,204 9.8 423,157 9.8 409,504 9.3 Other1,425,062 33.0 1,414,168 32.7 1,440,645 32.7 Total commercial real estate2,320,179 53.8 2,344,681 54.2 2,437,829 55.3 Residential real estate One-to-four family first liens471,688 11.0 477,150 11.1 495,408 11.2 One-to-four family junior liens182,346 4.2 179,232 4.2 182,001 4.1 Total residential real estate654,034 15.2 656,382 15.3 677,409 15.3 Consumer58,424 1.4 68,700 1.6 80,661 1.8 Loans held for investment, net of unearned income$4,304,184 100.0%$4,315,627 100.0%$4,414,646 100.0% Total commitments to extend credit$1,080,300 $1,080,737 $1,230,612 Loans held for investment, net of unearned income, decreased $11.4 million, or 0.3%, to $4.30 billion from $4.32 billion at December 31, 2024, primarily due to the reclassification of $11.0 million of credit card receivables to loans held for sale in the first quarter of 2025. Management expects the credit card portfolio sale to close in the fourth quarter of 2025. Loans held for investment, net of unearned income, decreased $110.5 million, or 2.5%, to $4.30 billion from $4.41 billion at March 31, 2024. The decrease from the first quarter of 2024 was driven primarily by the sale of loans associated with our Florida banking operations in the second quarter of 2024, partially offset by organic loan growth and higher line of credit usage. Investment SecuritiesMarch 31, 2025 December 31, 2024 March 31, 2024 (Dollars in thousands)Balance % of Total Balance % of Total Balance % of Total Available for sale$1,305,530 100.0%$1,328,433 100.0%$797,230 42.8%Held to maturity— —%— —%1,064,939 57.2%Total investment securities$1,305,530 $1,328,433 $1,862,169 Investment securities at March 31, 2025 were $1.31 billion, decreasing $22.9 million from December 31, 2024 and decreasing $556.6 million from March 31, 2024. The decrease from the fourth quarter of 2024 was primarily due to principal cash flows received from scheduled payments, calls, and maturities. The decrease from the first quarter of 2024 stemmed primarily from the sale of debt securities in connection with a balance sheet repositioning, as well as principal cash flows received from scheduled payments, calls, and maturities. DepositsMarch 31, 2025 December 31, 2024 March 31, 2024 (Dollars in thousands)Balance % of Total Balance % of Total Balance % of Total Noninterest bearing deposits$903,714 16.5%$951,423 17.4%$920,764 16.5%Interest checking deposits1,283,328 23.3 1,258,191 22.9 1,349,823 24.2 Money market deposits1,002,066 18.3 1,053,988 19.2 1,122,717 20.1 Savings deposits877,348 16.0 820,549 15.0 728,276 13.0 Time deposits of $250 and under818,012 14.9 826,793 15.1 787,851 14.1 Total core deposits4,884,468 89.0 4,910,944 89.6 4,909,431 87.9 Brokered time deposits200,000 3.6 200,000 3.7 205,000 3.7 Time deposits over $250404,674 7.4 367,038 6.7 470,805 8.4 Total deposits$5,489,142 100.0%$5,477,982 100.0%$5,585,236 100.0% Total deposits increased $11.2 million, or 0.2%, to $5.49 billion, from $5.48 billion at December 31, 2024. Total deposits decreased $96.1 million, or 1.7%, from $5.59 billion at March 31, 2024, primarily due to the deposits transferred in the sale of our Florida banking operations, partially offset by organic deposit growth in our targeted metropolitan markets. Borrowed FundsMarch 31, 2025 December 31, 2024 March 31, 2024 (Dollars in thousands)Balance % of Total Balance % of Total Balance % of Total Short-term borrowings$1,482 1.3%$3,186 2.7%$422,988 77.6%Long-term debt111,398 98.7%113,376 97.3%122,066 22.4%Total borrowed funds$112,880 $116,562 $545,054 Borrowed funds were $112.9 million at March 31, 2025, a decrease of $3.7 million from December 31, 2024 and a decrease of $432.2 million from March 31, 2024. The decrease compared to the linked quarter was due to lower customer repurchase agreement volumes and scheduled payments on long-term debt. The decrease compared to March 31, 2024 was primarily due to the pay-off of $405.0 million of BTFP borrowings and $13.0 million of a revolving credit facility, as well as scheduled payments on long-term debt. CapitalMarch 31, December 31, March 31,(Dollars in thousands)2025 (1) 2024 2024 Total shareholders' equity$579,625 $559,696 $528,040 Accumulated other comprehensive loss (63,098) (72,762) (60,804)MidWestOneFinancial Group, Inc. Consolidated Tier 1 leverage to average assets ratio 9.50% 9.15% 8.16%Common equity tier 1 capital to risk-weighted assets ratio 10.97% 10.73% 8.98%Tier 1 capital to risk-weighted assets ratio 11.84% 11.59% 9.75%Total capital to risk-weighted assets ratio 14.34% 14.07% 11.97%MidWestOneBank Tier 1 leverage to average assets ratio 10.42% 10.12% 9.36%Common equity tier 1 capital to risk-weighted assets ratio 13.02% 12.86% 11.20%Tier 1 capital to risk-weighted assets ratio 13.02% 12.86% 11.20%Total capital to risk-weighted assets ratio 14.21% 14.02% 12.25%(1) Regulatory capital ratios for March 31, 2025 are preliminary Total shareholders' equity at March 31, 2025 increased $19.9 million from December 31, 2024, driven primarily by an increase in retained earnings and a decrease in accumulated other comprehensive loss. Total shareholders' equity at March 31, 2025 increased $51.6 million from March 31, 2024, primarily due to increases in common stock and additional pain-in-capital stemming from the common equity capital raise in the third quarter of 2024, partially offset by a decrease in retained earnings. On April 22, 2025, the Board of Directors of the Company declared a cash dividend of $0.2425 per common share. The dividend is payable June 16, 2025, to shareholders of record at the close of business on June 2, 2025. No common shares were repurchased by the Company during the period December 31, 2024 through March 31, 2025 or for the subsequent period through April 24, 2025. The current share repurchase program allows for the repurchase of up to $15.0 million of the Company's common shares. As of March 31, 2025, $15.0 million remained available under this program. CREDIT QUALITY REVIEW Credit QualityAs of or For the Three Months EndedMarch 31, December 31, March 31,(Dollars in thousands) 2025 2024 2024 Credit loss expense related to loans$1,787 $1,891 $4,589 Net charge-offs 3,087 691 189 Allowance for credit losses 53,900 55,200 55,900 Pass$4,068,707 $4,056,361 $4,098,102 Special Mention 121,494 148,462 152,604 Classified 113,983 110,804 163,940 Criticized 235,477 259,266 316,544 Loans greater than 30 days past due and accruing$6,119 $9,378 $8,772 Nonperforming loans$17,470 $21,847 $29,267 Nonperforming assets 20,889 25,184 33,164 Net charge-off ratio(1) 0.29% 0.06% 0.02%Classified loans ratio(2) 2.65% 2.57% 3.71%Criticized loans ratio(3) 5.47% 6.01% 7.17%Nonperforming loans ratio(4) 0.41% 0.51% 0.66%Nonperforming assets ratio(5) 0.33% 0.40% 0.49%Allowance for credit losses ratio(6) 1.25% 1.28% 1.27%Allowance for credit losses to nonaccrual loans ratio(7) 309.47% 254.32% 197.53%(1) Net charge-off ratio is calculated as annualized net charge-offs divided by the sum of average loans held for investment, net of unearned income and average loans held for sale, during the period.(2) Classified loans ratio is calculated as classified loans divided by loans held for investment, net of unearned income, at the end of the period.(3) Criticized loans ratio is calculated as criticized loans divided by loans held for investment, net of unearned income, at the end of the period.(4) Nonperforming loans ratio is calculated as nonperforming loans divided by loans held for investment, net of unearned income, at the end of the period.(5) Nonperforming assets ratio is calculated as nonperforming assets divided by total assets at the end of the period.(6) Allowance for credit losses ratio is calculated as allowance for credit losses divided by loans held for investment, net of unearned income, at the end of the period.(7) Allowance for credit losses to nonaccrual loans ratio is calculated as allowance for credit losses divided by nonaccrual loans at the end of the period. Nonperforming loans and nonperforming assets ratios improved 10 bps and 7 bps, to 0.41% and 0.33%, respectively, compared to the linked quarter. In addition, special mention loan balances decreased $27.0 million, or 18%, while classified loan balances remained relatively stable with an increase of $3.2 million, or 3%. When compared to the same period of the prior year, the nonperforming loans and nonperforming asset ratios improved 25 bps and 16 bps, respectively, while the classified loan ratio improved 106 bps. Special mention loan balances decreased $31.1 million, or 20%. The net charge-off ratio increased 23 bps from the linked quarter and 27 bps from the same period in the prior year. As of March 31, 2025, the allowance for credit losses was $53.9 million and the allowance for credit losses ratio was 1.25%, compared with $55.2 million and 1.28%, respectively, at December 31, 2024. Credit loss expense of $1.7 million in the first quarter of 2025 primarily reflected additional reserve on pooled loans, offset by a reduction of $0.1 million in the reserve for unfunded loan commitments. Nonperforming Loans Roll ForwardNonaccrual 90+ Days Past Due & Still Accruing Total(Dollars in thousands) Balance at December 31, 2024$21,705 $142 $21,847Loans placed on nonaccrual or 90+ days past due & still accruing3,121 225 3,346Proceeds related to repayment or sale(4,158) — (4,158)Loans returned to accrual status or no longer past due(336) (49) (385)Charge-offs(2,774) (259) (3,033)Transfers to foreclosed assets(141) — (141)Transfer to nonaccrual— (6) (6)Balance at March 31, 2025$17,417 $53 $17,470 CONFERENCE CALL DETAILS The Company will host a conference call for investors at 11:00 a.m. CT on Friday, April 25, 2025. To participate, you may pre-register for this call utilizing the following link: https://www.netroadshow.com/events/login?show=29396e9f&confId=80376. After pre-registering for this event you will receive your access details via email. On the day of the call, you are also able to dial 1-833-470-1428 using an access code of 527448 at least fifteen minutes before the call start time. If you are unable to participate on the call, a replay will be available until July 24, 2025 by calling 1-866-813-9403 and using the replay access code of 162684. A transcript of the call will also be available on the Company’s web site (www.midwestonefinancial.com) within three business days of the call. ABOUT MIDWESTONE FINANCIAL GROUP, INC. MidWestOne Financial Group, Inc. is a financial holding company headquartered in Iowa City, Iowa. MidWestOne is the parent company of MidWestOne Bank, which operates banking offices in Iowa, Minnesota, Wisconsin, and Colorado. MidWestOne provides electronic delivery of financial services through its website, MidWestOne.bank. MidWestOne Financial Group, Inc. trades on the Nasdaq Global Select Market under the symbol “MOFG”. Cautionary Note Regarding Forward-Looking Statements This release contains certain “forward-looking statements” within the meaning of such term in the Private Securities Litigation Reform Act of 1995. We and our representatives may, from time to time, make written or oral statements that are “forward-looking” and provide information other than historical information. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any results, levels of activity, performance or achievements expressed or implied by any forward-looking statement. These factors include, among other things, the factors listed below. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of our management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “should,” “could,” “would,” “plans,” “goals,” “intend,” “project,” “estimate,” “forecast,” “may” or similar expressions. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those expressed in, or implied by, these statements. Readers are cautioned not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Additionally, we undertake no obligation to update any statement in light of new information or future events, except as required under federal securities law. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors that could have an impact on our ability to achieve operating results, growth plan goals and future prospects include, but are not limited to, the following: (1) the effects of changes in interest rates, including on our net income and the value of our securities portfolio; (2) fluctuations in the value of our investment securities; (3) effects on the U.S. economy resulting from the implementation of proposed policies and executive orders, including the imposition of tariffs, changes in immigration policy, changes to regulatory or other governmental agencies, changes in foreign policy and tax regulations; (4) volatility of rate-sensitive deposits; (5) asset/liability matching risks and liquidity risks; (6) the ability to successfully manage liquidity risk, which may increase dependence on non-core funding sources such as brokered deposits, and may negatively impact the Company’s cost of funds; (7) the concentration of large deposits from certain clients, including those who have balances above current FDIC insurance limits; (8) credit quality deterioration, pronounced and sustained reduction in real estate market values, or other uncertainties, including the impact of inflationary pressures and future monetary policies of the Federal Reserve in response thereto on economic conditions and our business, resulting in an increase in the allowance for credit losses, an increase in the credit loss expense, and a reduction in net earnings; (9) the sufficiency of the allowance for credit losses to absorb the amount of expected losses inherent in our existing loan portfolio; (10) the failure of assumptions underlying the establishment of allowances for credit losses and estimation of values of collateral and various financial assets and liabilities; (11) credit risks and risks from concentrations (by type of borrower, collateral, geographic area and by industry) within our loan portfolio; (12) changes in the economic environment, competition, or other factors that may affect our ability to acquire loans or influence the anticipated growth rate of loans and deposits and the quality of the loan portfolio and loan and deposit pricing; (13) governmental monetary and fiscal policies; (14) new or revised general economic, political, or industry conditions, nationally, internationally or in the communities in which we conduct business, including the risk of a recession; (15) the imposition of domestic or foreign tariffs or other governmental policies impacting the global supply chain and value of the agricultural or other products of our borrowers; (16) war or terrorist activities, including ongoing conflicts in the Middle East and the Russian invasion of Ukraine, widespread disease or pandemic, or other adverse external events, which may cause deterioration in the economy or cause instability in credit markets; (17) legislative and regulatory changes, including changes in banking, securities, trade, and tax laws and regulations and their application by our regulators, and including changes in interpretation or prioritization of such laws and regulations; (18) changes in accounting policies and practices, as may be adopted by state and federal regulatory agencies and the Financial Accounting Standards Board; (19) the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds, financial technology companies, and other financial institutions operating in our markets or elsewhere or providing similar services; (20) changes in the business and economic conditions generally and in the financial services industry, and the effects of recent developments and events in the financial services industry, including the large-scale deposit withdrawals over a short period of time that resulted in prior bank failures; (21) the occurrence of fraudulent activity, breaches, or failures of our or our third party vendors' information security controls or cyber-security related incidents, including as a result of sophisticated attacks using artificial intelligence and similar tools or as a result of insider fraud; (22) the ability to attract and retain key executives and employees experienced in banking and financial services; (23) our ability to adapt successfully to technological changes to compete effectively in the marketplace; (24) operational risks, including data processing system failures and fraud; (25) the costs, effects and outcomes of existing or future litigation or other legal proceedings and regulatory actions; (26) the risks of mergers or branch sales (including the sale of our Florida banking operations and the acquisition of Denver Bankshares, Inc.), including, without limitation, the related time and costs of implementing such transactions, integrating operations as part of these transactions and possible failures to achieve expected gains, revenue growth and/or expense savings from such transactions; (27) the economic impacts on the Company and its customers of climate change, natural disasters and exceptional weather occurrences, such as: tornadoes, floods and blizzards; and (28) other risk factors detailed from time to time in Securities and Exchange Commission filings made by the Company. MIDWESTONE FINANCIAL GROUP, INC. FIVE QUARTER CONSOLIDATED BALANCE SHEETS March 31, December 31, September 30, June 30, March 31,(In thousands) 2025 2024 2024 2024 2024 ASSETS Cash and due from banks$ 68,545 $ 71,803 $ 72,173 $ 66,228 $ 68,430 Interest earning deposits in banks 182,360 133,092 129,695 35,340 29,328 Federal funds sold — — — — 4 Total cash and cash equivalents 250,905 204,895 201,868 101,568 97,762 Debt securities available for sale at fair value 1,305,530 1,328,433 1,623,104 771,034 797,230 Held to maturity securities at amortized cost — — — 1,053,080 1,064,939 Total securities 1,305,530 1,328,433 1,623,104 1,824,114 1,862,169 Loans held for sale 13,836 749 3,283 2,850 2,329 Gross loans held for investment 4,315,546 4,328,413 4,344,559 4,304,619 4,433,258 Unearned income, net (11,362) (12,786) (15,803) (17,387) (18,612)Loans held for investment, net of unearned income 4,304,184 4,315,627 4,328,756 4,287,232 4,414,646 Allowance for credit losses (53,900) (55,200) (54,000) (53,900) (55,900)Total loans held for investment, net 4,250,284 4,260,427 4,274,756 4,233,332 4,358,746 Premises and equipment, net 90,031 90,851 90,750 91,793 95,986 Goodwill 69,788 69,788 69,788 69,388 71,118 Other intangible assets, net 23,611 25,019 26,469 27,939 29,531 Foreclosed assets, net 3,419 3,337 3,583 6,053 3,897 Other assets 246,990 252,830 258,881 224,621 226,477 Total assets$ 6,254,394 $ 6,236,329 $ 6,552,482 $ 6,581,658 $ 6,748,015 LIABILITIES Noninterest bearing deposits$ 903,714 $ 951,423 $ 917,715 $ 882,472 $ 920,764 Interest bearing deposits 4,585,428 4,526,559 4,451,012 4,529,947 4,664,472 Total deposits 5,489,142 5,477,982 5,368,727 5,412,419 5,585,236 Short-term borrowings 1,482 3,186 410,630 414,684 422,988 Long-term debt 111,398 113,376 115,051 114,839 122,066 Other liabilities 72,747 82,089 95,836 96,430 89,685 Total liabilities 5,674,769 5,676,633 5,990,244 6,038,372 6,219,975 SHAREHOLDERS' EQUITY Common stock 21,580 21,580 21,580 16,581 16,581 Additional paid-in capital 414,258 414,987 414,965 300,831 300,845 Retained earnings 227,790 217,776 206,490 306,030 294,066 Treasury stock (20,905) (21,885) (21,955) (22,021) (22,648)Accumulated other comprehensive loss (63,098) (72,762) (58,842) (58,135) (60,804)Total shareholders' equity 579,625 559,696 562,238 543,286 528,040 Total liabilities and shareholders' equity$ 6,254,394 $ 6,236,329 $ 6,552,482 $ 6,581,658 $ 6,748,015 MIDWESTONE FINANCIAL GROUP, INC. FIVE QUARTER CONSOLIDATED STATEMENTS OF INCOME Three Months Ended March 31, December 31, September 30, June 30, March 31,(In thousands, except per share data) 2025 2024 2024 2024 2024Interest income Loans, including fees$ 59,462 $ 62,458 $ 62,521 $ 61,643 $ 57,947Taxable investment securities 13,327 11,320 8,779 9,228 9,460Tax-exempt investment securities 703 728 1,611 1,663 1,710Other 1,247 3,761 785 242 418Total interest income 74,739 78,267 73,696 72,776 69,535Interest expense Deposits 25,484 27,324 29,117 28,942 27,726Short-term borrowings 25 115 5,043 5,409 4,975Long-term debt 1,791 1,890 2,015 2,078 2,103Total interest expense 27,300 29,329 36,175 36,429 34,804Net interest income 47,439 48,938 37,521 36,347 34,731Credit loss expense 1,687 1,291 1,535 1,267 4,689Net interest income after credit loss expense 45,752 47,647 35,986 35,080 30,042Noninterest income Investment services and trust activities 3,544 3,779 3,410 3,504 3,503Service charges and fees 2,131 2,159 2,170 2,156 2,144Card revenue 1,744 1,833 1,935 1,907 1,943Loan revenue 1,194 1,841 760 1,525 856Bank-owned life insurance 1,057 719 879 668 660Investment securities gains (losses), net 33 161 (140,182) 33 36Other 433 345 640 11,761 608Total noninterest income (loss) 10,136 10,837 (130,388) 21,554 9,750Noninterest expense Compensation and employee benefits 21,212 20,684 19,943 20,985 20,930Occupancy expense of premises, net 2,588 2,772 2,443 2,435 2,813Equipment 2,426 2,688 2,486 2,530 2,600Legal and professional 2,226 2,534 2,261 2,253 2,059Data processing 1,698 1,719 1,580 1,645 1,360Marketing 552 793 619 636 598Amortization of intangibles 1,408 1,449 1,470 1,593 1,637FDIC insurance 917 980 923 1,051 942Communications 159 154 159 191 196Foreclosed assets, net 74 56 330 138 358Other 3,033 3,543 3,584 2,304 2,072Total noninterest expense 36,293 37,372 35,798 35,761 35,565Income (loss) before income tax expense 19,595 21,112 (130,200) 20,873 4,227Income tax expense (benefit) 4,457 4,782 (34,493) 5,054 958Net income (loss)$ 15,138 $ 16,330 $ (95,707) $ 15,819 $ 3,269 Earnings (loss) per common share Basic$ 0.73 $ 0.79 $ (6.05) $ 1.00 $ 0.21Diluted$ 0.73 $ 0.78 $ (6.05) $ 1.00 $ 0.21Weighted average basic common shares outstanding 20,797 20,776 15,829 15,763 15,723Weighted average diluted common shares outstanding 20,849 20,851 15,829 15,781 15,774Dividends paid per common share$ 0.2425 $ 0.2425 $ 0.2425 $ 0.2425 $ 0.2425 MIDWESTONE FINANCIAL GROUP, INC. FINANCIAL STATISTICS As of or for the Three Months Ended March 31, December 31, March 31,(Dollars in thousands, except per share amounts) 2025 2024 2024 Earnings: Net interest income$47,439 $48,938 $34,731 Noninterest income 10,136 10,837 9,750 Total revenue, net of interest expense 57,575 59,775 44,481 Credit loss expense 1,687 1,291 4,689 Noninterest expense 36,293 37,372 35,565 Income before income tax expense 19,595 21,112 4,227 Income tax expense 4,457 4,782 958 Net income$15,138 $16,330 $3,269 Adjusted earnings(1)$15,301 $16,112 $4,504 Per Share Data: Diluted earnings$0.73 $0.78 $0.21 Adjusted earnings(1) 0.73 0.77 0.29 Book value 27.85 26.94 33.53 Tangible book value(1) 23.36 22.37 27.14 Ending Balance Sheet: Total assets$6,254,394 $6,236,329 $6,748,015 Loans held for investment, net of unearned income 4,304,184 4,315,627 4,414,646 Total securities 1,305,530 1,328,433 1,862,169 Total deposits 5,489,142 5,477,982 5,585,236 Short-term borrowings 1,482 3,186 422,988 Long-term debt 111,398 113,376 122,066 Total shareholders' equity 579,625 559,696 528,040 Average Balance Sheet: Average total assets$6,168,546 $6,279,975 $6,635,379 Average total loans 4,290,710 4,307,583 4,298,216 Average total deposits 5,398,819 5,464,900 5,481,114 Financial Ratios: Return on average assets 1.00% 1.03% 0.20%Return on average equity 10.74% 11.53% 2.49%Return on average tangible equity(1) 13.75% 14.80% 4.18%Efficiency ratio(1) 59.38% 59.06% 71.28%Net interest margin, tax equivalent(1) 3.44% 3.43% 2.33%Loans to deposits ratio 78.41% 78.78% 79.04%CET1 Ratio 10.97% 10.73% 8.98%Common equity ratio 9.27% 8.97% 7.83%Tangible common equity ratio(1) 7.89% 7.57% 6.43%Credit Risk Profile: Total nonperforming loans$17,470 $21,847 $29,267 Nonperforming loans ratio 0.41% 0.51% 0.66%Total nonperforming assets$20,889 $25,184 $33,164 Nonperforming assets ratio 0.33% 0.40% 0.49%Net charge-offs$3,087 $691 $189 Net charge-off ratio 0.29% 0.06% 0.02%Allowance for credit losses$53,900 $55,200 $55,900 Allowance for credit losses ratio 1.25% 1.28% 1.27%Allowance for credit losses to nonaccrual ratio 309.47% 254.32% 197.53% (1) Non-GAAP measure. See the Non-GAAP Measures section for a reconciliation to the most directly comparable GAAP measure. MIDWESTONE FINANCIAL GROUP, INC. AVERAGE BALANCE SHEET AND YIELD ANALYSIS Three Months Ended March 31, 2025 December 31, 2024 March 31, 2024(Dollars in thousands)AverageBalance InterestIncome/Expense AverageYield/Cost AverageBalance InterestIncome/Expense AverageYield/Cost Average Balance InterestIncome/Expense AverageYield/CostASSETS Loans, including fees (1)(2)(3)$4,290,710 $60,443 5.71% $4,307,583 $63,443 5.86% $4,298,216 $58,867 5.51%Taxable investment securities1,207,844 13,327 4.47% 1,080,716 11,320 4.17% 1,557,603 9,460 2.44%Tax-exempt investment securities (2)(4)105,563 865 3.32% 109,183 896 3.26% 328,736 2,097 2.57%Total securities held for investment(2)1,313,407 14,192 4.38% 1,189,899 12,216 4.08% 1,886,339 11,557 2.46%Other124,133 1,247 4.07% 309,904 3,761 4.83% 30,605 418 5.49%Total interest earning assets(2)$5,728,250 $75,882 5.37% $5,807,386 $79,420 5.44% $6,215,160 $70,842 4.58%Other assets440,296 472,589 420,219 Total assets$6,168,546 $6,279,975 $6,635,379 LIABILITIES AND SHAREHOLDERS’ EQUITY Interest checking deposits$1,240,586 $2,127 0.70% $1,252,481 $2,205 0.70% $1,301,470 $2,890 0.89%Money market deposits1,002,743 6,333 2.56% 1,046,571 7,197 2.74% 1,102,543 8,065 2.94%Savings deposits835,731 3,057 1.48% 799,931 3,158 1.57% 694,143 2,047 1.19%Time deposits1,397,595 13,967 4.05% 1,410,542 14,764 4.16% 1,446,981 14,724 4.09%Total interest bearing deposits4,476,655 25,484 2.31% 4,509,525 27,324 2.41% 4,545,137 27,726 2.45%Securities sold under agreements to repurchase2,705 5 0.75% 3,640 8 0.87% 5,330 11 0.83%Other short-term borrowings— 20 —% 6,465 107 6.58% 409,525 4,964 4.88%Total short-term borrowings2,705 25 3.75% 10,105 115 4.53% 414,855 4,975 4.82%Long-term debt113,364 1,791 6.41% 116,018 1,890 6.48% 123,266 2,103 6.86%Total borrowed funds116,069 1,816 6.35% 126,123 2,005 6.32% 538,121 7,078 5.29%Total interest bearing liabilities$4,592,724 $27,300 2.41% $4,635,648 $29,329 2.52% $5,083,258 $34,804 2.75%Noninterest bearing deposits922,164 955,375 935,977 Other liabilities82,280 125,536 88,611 Shareholders’ equity571,378 563,416 527,533 Total liabilities and shareholders’ equity$6,168,546 $6,279,975 $6,635,379 Net interest income(2) $48,582 $50,091 $36,038 Net interest spread(2) 2.96% 2.92% 1.83%Net interest margin(2) 3.44% 3.43% 2.33% Total deposits(5)$5,398,819 $25,484 1.91% $5,464,900 $27,324 1.99% $5,481,114 $27,726 2.03%Cost of funds(6) 2.01% 2.09% 2.33% (1)Average balance includes nonaccrual loans.(2)Tax equivalent. The federal statutory tax rate utilized was 21%.(3)Interest income includes net loan fees, loan purchase discount accretion and tax equivalent adjustments. Net loan fees were $256 thousand, $456 thousand, and $237 thousand for the three months ended March 31, 2025, December 31, 2024, and March 31, 2024, respectively. Loan purchase discount accretion was $1.2 million, $2.5 million, and $1.2 million for the three months ended March 31, 2025, December 31, 2024, and March 31, 2024, respectively. Tax equivalent adjustments were $981 thousand, $985 thousand, and $920 thousand for the three months ended March 31, 2025, December 31, 2024, and March 31, 2024, respectively. The federal statutory tax rate utilized was 21%.(4)Interest income includes tax equivalent adjustments of $162 thousand, $168 thousand, and $387 thousand for the three months ended March 31, 2025, December 31, 2024, and March 31, 2024, respectively. The federal statutory tax rate utilized was 21%.(5)Total deposits is the sum of total interest-bearing deposits and noninterest bearing deposits. The cost of total deposits is calculated as annualized interest expense on deposits divided by average total deposits.(6)Cost of funds is calculated as annualized total interest expense divided by the sum of average total deposits and borrowed funds. Non-GAAP Measures This earnings release contains non-GAAP measures for tangible common equity, tangible book value per share, tangible common equity ratio, return on average tangible equity, net interest margin (tax equivalent), core net interest margin, loan yield (tax equivalent), core yield on loans, efficiency ratio, adjusted earnings and adjusted earnings per share. Management believes these measures provide investors with useful information regarding the Company’s profitability, financial condition and capital adequacy, consistent with how management evaluates the Company’s financial performance. The following tables provide a reconciliation of each non-GAAP measure to the most comparable GAAP measure. Tangible Common Equity/Tangible Book Value per Share/Tangible Common Equity Ratio March 31, December 31, September 30, June 30, March 31,(Dollars in thousands, except per share data) 2025 2024 2024 2024 2024 Total shareholders’ equity $579,625 $559,696 $562,238 $543,286 $528,040 Intangible assets, net (93,399) (94,807) (96,257) (97,327) (100,649)Tangible common equity $486,226 $464,889 $465,981 $445,959 $427,391 Total assets $6,254,394 $6,236,329 $6,552,482 $6,581,658 $6,748,015 Intangible assets, net (93,399) (94,807) (96,257) (97,327) (100,649)Tangible assets $6,160,995 $6,141,522 $6,456,225 $6,484,331 $6,647,366 Book value per share $27.85 $26.94 $27.06 $34.44 $33.53 Tangible book value per share(1) $23.36 $22.37 $22.43 $28.27 $27.14 Shares outstanding 20,815,715 20,777,485 20,774,919 15,773,468 15,750,471 Common equity ratio 9.27% 8.97% 8.58% 8.25% 7.83%Tangible common equity ratio(2) 7.89% 7.57% 7.22% 6.88% 6.43% (1) Tangible common equity divided by shares outstanding. (2) Tangible common equity divided by tangible assets. Three Months EndedReturn on Average Tangible Equity March 31, December 31, March 31,(Dollars in thousands) 2025 2024 2024 Net income $15,138 $16,330 $3,269 Intangible amortization, net of tax(1) 1,047 1,075 1,228 Tangible net income $16,185 $17,405 $4,497 Average shareholders’ equity $571,378 $563,416 $527,533 Average intangible assets, net (94,169) (95,498) (95,296)Average tangible equity $477,209 $467,918 $432,237 Return on average equity 10.74% 11.53% 2.49%Return on average tangible equity(2) 13.75% 14.80% 4.18% (1) The income tax rate utilized was the blended marginal tax rate. (2) Annualized tangible net income divided by average tangible equity. Net Interest Margin, Tax Equivalent/Core Net Interest Margin Three Months Ended March 31, December 31, March 31,(Dollars in thousands) 2025 2024 2024 Net interest income $47,439 $48,938 $34,731 Tax equivalent adjustments: Loans(1) 981 985 920 Securities(1) 162 168 387 Net interest income, tax equivalent $48,582 $50,091 $36,038 Loan purchase discount accretion (1,166) (2,496) (1,152)Core net interest income $47,416 $47,595 $34,886 Net interest margin 3.36% 3.35% 2.25%Net interest margin, tax equivalent(2) 3.44% 3.43% 2.33%Core net interest margin(3) 3.36% 3.26% 2.26%Average interest earning assets $5,728,250 $5,807,386 $6,215,160 (1) The federal statutory tax rate utilized was 21%. (2) Annualized tax equivalent net interest income divided by average interest earning assets. (3) Annualized core net interest income divided by average interest earning assets. Three Months EndedLoan Yield, Tax Equivalent / Core Yield on Loans March 31, December 31, March 31,(Dollars in thousands) 2025 2024 2024 Loan interest income, including fees $59,462 $62,458 $57,947 Tax equivalent adjustment(1) 981 985 920 Tax equivalent loan interest income $60,443 $63,443 $58,867 Loan purchase discount accretion (1,166) (2,496) (1,152)Core loan interest income $59,277 $60,947 $57,715 Yield on loans 5.62% 5.77% 5.42%Yield on loans, tax equivalent(2) 5.71% 5.86% 5.51%Core yield on loans(3) 5.60% 5.63% 5.40%Average loans $4,290,710 $4,307,583 $4,298,216 (1) The federal statutory tax rate utilized was 21%. (2) Annualized tax equivalent loan interest income divided by average loans. (3) Annualized core loan interest income divided by average loans. Three Months EndedEfficiency Ratio March 31, December 31, March 31,(Dollars in thousands) 2025 2024 2024 Total noninterest expense $36,293 $37,372 $35,565 Amortization of intangibles (1,408) (1,449) (1,637)Merger-related expenses (40) (31) (1,314)Noninterest expense used for efficiency ratio $34,845 $35,892 $32,614 Net interest income, tax equivalent(1) $48,582 $50,091 $36,038 Plus: Noninterest income 10,136 10,837 9,750 Less: Investment securities gains, net 33 161 36 Net revenues used for efficiency ratio $58,685 $60,767 $45,752 Efficiency ratio (2) 59.38% 59.06% 71.28% (1) The federal statutory tax rate utilized was 21%. (2) Noninterest expense adjusted for amortization of intangibles and merger-related expenses divided by the sum of tax equivalent net interest income, noninterest income and net investment securities gains. Three Months EndedAdjusted Earnings March 31, December 31, March 31,(Dollars in thousands, except per share data) 2025 2024 2024 Net income $ 15,138 $ 16,330 $ 3,269 Less: Investment securities gains, net of tax(1) 25 119 27 Less: Mortgage servicing rights (loss) gain, net of tax(1) (158) 122 (276)Plus: Merger-related expenses, net of tax(1) 30 23 986 Adjusted earnings $ 15,301 $ 16,112 $ 4,504 Weighted average diluted common shares outstanding 20,849 20,851 15,774 Earnings per common share - diluted $ 0.73 $ 0.78 $ 0.21 Adjusted earnings per common share(2) $ 0.73 $ 0.77 $ 0.29 (1) The income tax rate utilized was the blended marginal tax rate. (2) Adjusted earnings divided by weighted average diluted common shares outstanding. Category: Earnings This news release may be downloaded from Corporate Profile | MidWestOne Financial Group, Inc. Source: MidWestOne Financial Group, Inc. Industry: Banks Contact: Charles N. ReevesBarry S. Ray Chief Executive OfficerChief Financial Officer 319.356.5800 319.356.5800

MidWestOne Financial Group, Inc. Reports Financial Results For the First Quarter of 2025

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