First Mid Bancshares, Inc. Announces Fourth Quarter 2023 Results

Published

MATTOON, Ill., Jan. 25, 2024 (GLOBE NEWSWIRE) -- First Mid Bancshares, Inc. (NASDAQ: FMBH) (the “Company”) today announced its financial results for the quarter and year ended December 31, 2023.

Highlights

  • Net income of $18.1 million, or $0.76 diluted EPS
  • Adjusted net income (non-GAAP) of $22.4 million, or $0.94 diluted EPS
  • Completed the merger and integration of Blackhawk Bank (“Blackhawk”)
  • Sold additional bonds to reposition balance sheet helping drive a strong net interest margin of 3.33%
  • Strong asset quality performance continued with minimal net charge offs for the quarter
  • Board of Directors declares regular quarterly dividend of $0.23 per share

“We capped off 2023 with a strong quarter of financial results,” said Joe Dively, Chairman and Chief Executive Officer. “This was the first full quarter inclusive of Blackhawk and the value of the transaction is evident in our results. We completed another step in the Blackhawk related balance sheet repositioning by selling additional bonds with proceeds of $79.7 million used to reduce brokered CDs and wholesale borrowings, improving our net interest margin.”

“During the quarter, we completed the merger of Blackhawk into First Mid Bank & Trust and the related core system conversion. Our employees worked extremely hard to make the transition as seamless as possible for our customers in what was our largest, most complex integration. I am proud of the efforts of our team and their support of our customers,” Dively concluded.

Net Interest Income Net interest income for the fourth quarter of 2023 increased by $7.0 million, or 13.9% compared to the third quarter of 2023. Interest income and interest expense increased in the quarter by $9.5 million and $2.5 million, respectively. The increase in interest income was primarily driven by the addition of Blackhawk, loan growth, and the repricing of loans with higher interest rates. Accretion income for the quarter was $4.6 million, an increase compared to $2.6 million in the prior quarter. The increase in interest expense was primarily driven by the addition of Blackhawk and higher interest rates. During the quarter, the Company sold $79.7 million of bonds and used the proceeds to payoff maturing brokered CDs and wholesale borrowings.            

In comparison to the fourth quarter of 2022, net interest income increased $11.8 million, or 25.8%. The increase was primarily driven by the addition of Blackhawk. For the same period, interest income increased by $29.2 million, while interest expense increased $17.4 million.                     

Net Interest MarginNet interest margin, on a tax equivalent basis (non-GAAP), was 3.33% for the fourth quarter of 2023, which was 27 basis points higher compared to the prior quarter. Earning asset yields increased by 29 basis points and the average cost of funds increased 2 basis points.        

In comparison to the fourth quarter of last year, the net interest margin increased 26 basis points, with an average earning asset increase of 111 basis points versus the average cost of funds increase of 85 basis points.

Loan Portfolio Total loans ended the quarter at $5.58 billion, representing an increase of $40.5 million. The growth was spread among several categories with the largest increase in Ag operating loans. Overall, loan demand slightly improved and we saw an increase in line draws during the period. Most of the new originations and renewed loans in the period were at rates in the 8.00% to 8.50% range. 

Asset Quality The fourth quarter was another strong period with respect to the Company’s asset quality metrics. The allowance for credit losses (“ACL”) increased by $0.4 million to $68.7 million with an ending ACL to total loans ratio of 1.23%. In addition to the ACL, an unearned discount of $49.9 million remains at quarter end. Provision expense was recorded in the amount of $0.6 million with net charge offs of $0.1 million in the quarter. Also, at the end of the fourth quarter, the ratio of non-performing loans to total loans was 0.36%, and the ACL to non-performing loans was 341.19%.   The ratio of nonperforming assets to total assets was 0.28% and nonperforming loans were $20.1 million at quarter end. For the quarter, special mention loans were $74.1 million and substandard loans were $28.9 million.        

DepositsTotal deposits ended the quarter at $6.12 billion, which represented a decrease of $222.7 million from the prior quarter. Of the decline, $73.2 million came from time deposits, including brokered, where the Company used proceeds from its bond sales to pay these off at maturity. The remaining portion of the decline in balances was driven primarily by seasonal cash flow operating needs of commercial customers. Noninterest bearing deposits increased by $9.2 million in the quarter. The Company’s average rate on cost of funds increased to 1.85% compared to 1.83% in the prior quarter and 1.00% in the fourth quarter of 2022.                

Noninterest IncomeNoninterest income represented 31% of our total net revenues for the year.

Noninterest income for the fourth quarter of 2023 was $21.8 million compared to $23.1 million in the third quarter of 2023.   Excluding securities gains for both periods, noninterest income increased $2.1 million in the current quarter. The increase was primarily driven by the full quarter benefit of Blackhawk, along with higher insurance revenues.     

In comparison to the fourth quarter of 2022, noninterest income increased $3.6 million, or 19.6%, due to a combination of organic growth and the addition of Blackhawk’s operating costs for the period.                  

Noninterest Expenses      Noninterest expense for the fourth quarter of 2023 totaled $57.0 million compared to $47.1 million in the prior quarter. The increase was primarily driven by the full quarter of Blackhawk and approximately $5.6 million in nonrecurring acquisition related costs.

In comparison to the fourth quarter of 2022, noninterest expenses increased $17.7 million. In addition to $5.6 million in nonrecurring integration related costs during the period, the increase was primarily driven by the addition of Blackhawk.

The Company’s efficiency ratio, as adjusted in the non-GAAP reconciliation table herein, for the fourth quarter 2023 was 58.9% compared to 58.6% in the prior quarter and 58.1% for the same period last year.

Capital Levels, Dividend and TaxesThe Company’s capital levels remained strong and above the “well capitalized” levels. Capital levels ended the period as follows:

Total capital to risk-weighted assets 14.84%  
Tier 1 capital to risk-weighted assets 12.02%  
Common equity tier 1 capital to risk-weighted assets 11.62%  
Leverage ratio 9.33%  
   

Tangible book value per share increased in the period to $22.20 on a combination of both earnings growth and improvement in the unrealized loss position in the bond portfolio impacting accumulated other comprehensive income (“AOCI”).

The Company’s Board of Directors approved a regular quarterly dividend of $0.23 payable on March 1, 2024 for shareholders of record on February 16, 2024.

The Company’s effective tax rate for the fourth quarter was 16.6% and 22.0% for the year. The lower rate in the current period was primarily due to $0.8 million of refunds for amendments filed on Wisconsin state taxes.

About First Mid: First Mid Bancshares, Inc. (“First Mid”) is the parent company of First Mid Bank & Trust, N.A., First Mid Insurance Group, Inc., and First Mid Wealth Management Co. First Mid is a $7.6 billion community-focused organization that provides a full-suite of financial services including banking, wealth management, brokerage, Ag services, and insurance through a sizeable network of locations throughout Illinois, Missouri, Texas, and Wisconsin and a loan production office in the greater Indianapolis area. Together, our First Mid team takes great pride in providing solutions and services to the customers and communities and has done so over the last 159 years. More information about the Company is available on our website at www.firstmid.com.

Non-GAAP Measures: In addition to reports presented in accordance with generally accepted accounting principles (“GAAP”), this release contains certain non-GAAP financial measures. The Company believes that such non-GAAP financial measures provide investors with information useful in understanding the Company’s financial performance. Readers of this release, however, are urged to review these non-GAAP financial measures in conjunction with the GAAP results as reported. These non-GAAP financial measures are detailed as supplemental tables and include “Adjusted Net Income,” “Adjusted Diluted EPS,” “Efficiency Ratio,” “Net Interest Margin, tax equivalent,” and “Tangible Book Value per Common Share”. While the Company believes these non-GAAP financial measures provide investors with a broader understanding of the capital adequacy, funding profile and financial trends of the Company, this information should be considered as supplemental in nature and not as a substitute to the related financial information prepared in accordance with GAAP. These non-GAAP financial measures may also differ from the similar measures presented by other companies.

Forward Looking Statements This document may contain certain forward-looking statements about First Mid, such as discussions of First Mid’s pricing and fee trends, credit quality and outlook, liquidity, new business results, expansion plans, anticipated expenses and planned schedules. First Mid intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Forward-looking statements, which are based on certain assumptions and describe future plans, strategies and expectations of First Mid are identified by use of the words “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project,” or similar expressions. Actual results could differ materially from the results indicated by these statements because the realization of those results is subject to many risks and uncertainties, including, among other things, changes in interest rates; general economic conditions and those in the market areas of First Mid; legislative and/or regulatory changes; monetary and fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal Reserve Board; the quality or composition of First Mid’s loan or investment portfolios and the valuation of those investment portfolios; demand for loan products; deposit flows; competition, demand for financial services in the market areas of First Mid; accounting principles, policies and guidelines; and the impact of the global COVID-19 pandemic on First Mid’s businesses. Additional information concerning First Mid, including additional factors and risks that could materially affect First Mid’s financial results, are included in First Mid’s filings with the SEC, including its Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q. Forward-looking statements speak only as of the date they are made. Except as required under the federal securities laws or the rules and regulations of the SEC, we do not undertake any obligation to update or review any forward-looking information, whether as a result of new information, future events or otherwise.

Investor Contact: Aaron HoltVP, Shareholder Relations217-258-0463 aholt@firstmid.com

Matt SmithChief Financial Officer217-258-1528msmith@firstmid.com

– Tables Follow –

       
  FIRST MID BANCSHARES, INC.
  Condensed Consolidated Balance Sheets
  (In thousands, unaudited)
   
  As of
  December 31, September 30, December 31,
   2023   2023   2022 
       
Assets      
Cash and cash equivalents $143,064  $383,237  $152,433 
Investment securities  1,179,402   1,226,746   1,223,720 
Loans (including loans held for sale)  5,580,565   5,540,065   4,826,212 
Less allowance for credit losses  (68,675)  (68,241)  (59,093)
Net loans  5,511,890   5,471,824   4,767,119 
Premises and equipment, net  101,396   102,004   90,473 
Goodwill and intangibles, net  264,231   267,793   169,897 
Bank owned life insurance  166,125   165,022   151,756 
Other assets  220,686   238,668   188,817 
  Total assets $7,586,794  $7,855,294  $6,744,215 
       
Liabilities and Stockholders' Equity      
Deposits:      
Non-interest bearing $1,398,234  $1,389,022  $1,256,514 
Interest bearing  4,725,425   4,957,302   4,000,487 
Total deposits  6,123,659   6,346,324   5,257,001 
Repurchase agreement with customers  213,721   214,978   221,414 
Other borrowings  263,787   364,953   465,071 
Junior subordinated debentures  24,058   24,003   19,364 
Subordinated debt  106,755   106,648   94,553 
Other liabilities  61,610   60,440   53,657 
  Total liabilities  6,793,590   7,117,346   6,111,060 
       
  Total stockholders' equity  793,204   737,948   633,155 
Total liabilities and stockholders' equity $7,586,794  $7,855,294  $6,744,215 
       

FIRST MID BANCSHARES, INC.
Condensed Consolidated Statements of Income
(In thousands, except per share data, unaudited)
         
  Three Months Ended Twelve Months Ended
  December 31, December 31,
   2023  2022   2023  2022
Interest income:        
Interest and fees on loans $78,676 $53,128  $262,423 $185,869
Interest on investment securities  8,515  7,285   32,119  29,380
Interest on federal funds sold & other deposits  2,736  296   5,624  642
  Total interest income  89,927  60,709   300,166  215,891
Interest expense:        
Interest on deposits  25,900  9,227   77,294  18,813
Interest on securities sold under agreements to repurchase  1,754  1,163   6,565  1,795
Interest on other borrowings  3,073  3,345   16,789  6,193
Interest on jr. subordinated debentures  545  315   1,859  868
Interest on subordinated debt  1,193  987   4,196  3,945
  Total interest expense  32,465  15,037   106,703  31,614
Net interest income  57,462  45,672   193,463  184,277
Provision for credit losses  552  805   6,104  4,806
Net interest income after provision for loan  56,910  44,867   187,359  179,471
Non-interest income:        
Wealth management revenues  4,998  6,201   20,793  22,492
Insurance commissions  5,398  4,719   24,814  21,622
Service charges  3,298  2,375   10,881  9,112
Net securities gains/(losses)  46  (48)  3,383  33
Mortgage banking revenues  954  65   2,282  1,190
ATM/debit card revenue  4,233  3,209   14,347  12,422
Other  2,841  1,686   10,286  7,811
Total non-interest income  21,768  18,207   86,786  74,682
Non-interest expense:        
Salaries and employee benefits  29,925  23,610   104,962  98,594
Net occupancy and equipment expense  7,977  6,126   26,946  24,257
Net other real estate owned (income) expense  800  87   1,862  330
FDIC insurance  1,015  464   3,339  1,805
Amortization of intangible assets  3,560  1,537   9,127  6,290
Stationary and supplies  404  298   1,346  1,295
Legal and professional expense  2,065  1,607   7,379  6,996
ATM/debit card expense  1,332  1,309   5,322  4,300
Marketing and donations  679  681   3,005  2,999
Other  9,268  3,653   22,452  15,995
Total non-interest expense  57,025  39,372   185,740  162,861
Income before income taxes  21,653  23,702   88,405  91,292
Income taxes  3,582  3,063   19,470  18,340
Net income $18,071 $20,639  $68,935 $72,952
         
Per Share Information        
Basic earnings per common share $0.76 $1.01  $3.17 $3.62
Diluted earnings per common share  0.76  1.01   3.15  3.60
         
Weighted average shares outstanding  23,837,853  20,461,046   21,780,217  20,169,077
Diluted weighted average shares outstanding  23,921,758  20,535,220   21,868,788  20,243,635
         

FIRST MID BANCSHARES, INC.
Condensed Consolidated Statements of Income
(In thousands, except per share data, unaudited)
           
  For the Quarter Ended
  December 31, September 30, June 30, March 31, December 31,
   2023  2023  2023   2023   2022 
Interest income:          
Interest and fees on loans $78,676 $69,143 $58,368  $56,236  $53,128 
Interest on investment securities  8,515  9,284  7,193   7,127   7,285 
Interest on federal funds sold & other deposits  2,736  2,011  569   308   296 
  Total interest income  89,927  80,438  66,130   63,671   60,709 
Interest expense:          
Interest on deposits  25,900  22,047  16,580   12,767   9,227 
Interest on securities sold under agreements to repurchase  1,754  1,625  1,723   1,463   1,163 
Interest on other borrowings  3,073  4,749  4,084   4,883   3,345 
Interest on jr. subordinated debentures  545  545  390   379   315 
Interest on subordinated debt  1,193  1,029  986   988   987 
  Total interest expense  32,465  29,995  23,763   20,480   15,037 
Net interest income  57,462  50,443  42,367   43,191   45,672 
Provision for credit losses  552  5,911  458   (817)  805 
Net interest income after provision for loan  56,910  44,532  41,909   44,008   44,867 
Non-interest income:          
Wealth management revenues  4,998  4,940  5,341   5,514   6,201 
Insurance commissions  5,398  5,199  5,737   8,480   4,719 
Service charges  3,298  2,994  2,386   2,203   2,375 
Securities gains, net  46  3,389  (6)  (46)  (48)
Mortgage banking revenues  954  846  332   150   65 
ATM/debit card revenue  4,233  3,766  3,265   3,083   3,209 
Other  2,841  1,919  2,431   3,095   1,686 
Total non-interest income  21,768  23,053  19,486   22,479   18,207 
Non-interest expense:          
Salaries and employee benefits  29,925  25,422  23,544   26,071   23,610 
Net occupancy and equipment expense  7,977  6,929  6,035   6,005   6,126 
Net other real estate owned (income) expense  800  902  27   133   87 
FDIC insurance  1,015  785  1,076   463   464 
Amortization of intangible assets  3,560  2,568  1,477   1,522   1,537 
Stationary and supplies  404  335  315   292   298 
Legal and professional expense  2,065  1,844  1,780   1,690   1,607 
ATM/debit card expense  1,332  1,751  1,016   1,223   1,309 
Marketing and donations  679  764  908   654   681 
Other  9,268  5,796  3,864   3,524   3,653 
Total non-interest expense  57,025  47,096  40,042   41,577   39,372 
Income before income taxes  21,653  20,489  21,353   24,910   23,702 
Income taxes  3,582  5,372  4,786   5,730   3,063 
Net income $18,071 $15,117 $16,567  $19,180  $20,639 
           
Per Share Information          
Basic earnings per common share $0.76 $0.68 $0.81  $0.94  $1.01 
Diluted earnings per common share  0.76  0.68  0.80   0.93   1.01 
           
Weighted average shares outstanding  23,837,853  22,220,438  20,528,717   20,492,254   20,461,046 
Diluted weighted average shares outstanding  23,921,758  22,319,334  20,628,239   20,563,972   20,535,220 
           

  FIRST MID BANCSHARES, INC.
  Consolidated Financial Highlights and Ratios
  (Dollars in thousands, except per share data)
  (Unaudited)
  As of and for the Quarter Ended
  December 31, September 30, June 30, March 31, December 31,
   2023   2023   2023   2023   2022 
           
Loan Portfolio           
Construction and land development $205,077  $189,206  $151,574  $159,157  $144,264 
Farm real estate loans  391,132   399,834   392,220   401,957   410,327 
1-4 Family residential properties  542,469   531,699   418,932   424,545   440,180 
Multifamily residential properties  319,129   327,067   303,482   301,808   294,346 
Commercial real estate  2,384,704   2,392,834   2,056,529   2,003,647   2,030,011 
     Loans secured by real estate  3,842,511   3,840,640   3,322,737   3,291,114   3,319,128 
Agricultural operating loans  196,272   179,447   148,318   146,847   166,838 
Commercial and industrial loans  1,266,159   1,242,653   1,094,522   1,078,021   1,082,960 
Consumer loans  91,014   99,542   80,241   88,430   97,775 
All other loans  184,609   177,783   167,598   156,219   159,511 
Total loans  5,580,565   5,540,065   4,813,416   4,760,631   4,826,212 
           
Deposit Portfolio           
Non-interest bearing demand deposits $1,398,234  $1,389,022  $1,171,047  $1,262,181  $1,256,514 
Interest bearing demand deposits  1,837,296   1,940,162   1,477,765   1,419,791   1,389,283 
Savings deposits  710,586   734,377   602,523   639,691   636,699 
Money Market  1,129,950   1,161,957   923,259   878,452   1,267,726 
Time deposits  1,047,593   1,120,806   1,044,991   830,663   706,779 
Total deposits  6,123,659   6,346,324   5,219,585   5,030,778   5,257,001 
           
Asset Quality          
Non-performing loans $20,128  $21,269  $18,637  $15,163  $19,170 
Non-performing assets  21,292   23,565   22,615   19,225   23,539 
Net charge-offs (recoveries)  118   181   (38)  53   489 
Allowance for credit losses to non-performing loans  341.19%  320.85%  315.07%  383.98%  308.26%
Allowance for credit losses to total loans outstanding  1.23%  1.23%  1.22%  1.22%  1.22%
Nonperforming loans to total loans  0.36%  0.38%  0.39%  0.32%  0.40%
Nonperforming assets to total assets  0.28%  0.30%  0.34%  0.29%  0.35%
Special Mention loans  74,050   73,732   40,687   47,022   39,853 
Substandard and Doubtful loans  28,945   30,575   28,255   29,931   34,352 
           
Common Share Data          
Common shares outstanding  23,827,137   23,830,038   20,528,192   20,519,717   20,452,376 
Book value per common share $33.29  $30.97  $32.18  $32.26  $30.96 
Tangible book value per common share (1)  22.20   19.73   23.48   24.05   22.65 
Tangible book value per common share excluding other comprehensive income at period end (1)  27.93   27.24   30.87   30.77   30.06 
Market price of stock  34.66   26.56   24.14   27.22   32.08 
           
Key Performance Ratios and Metrics          
End of period earning assets $6,780,160  $7,007,282  $6,023,553  $5,995,674  $6,063,953 
Average earning assets  6,948,309   6,593,781   6,049,626   6,052,264   6,000,106 
Average rate on average earning assets (tax equivalent)  5.18%  4.89%  4.43%  4.32%  4.07%
Average rate on cost of funds  1.85%  1.83%  1.59%  1.38%  1.00%
Net interest margin (tax equivalent) (1)  3.33%  3.06%  2.84%  2.94%  3.07%
Return on average assets  0.93%  0.90%  0.99%  1.15%  1.24%
Adjusted return on average assets (1)  1.16%  0.94%  1.03%  1.18%  1.25%
Return on average common equity  9.76%  8.70%  10.07%  12.11%  13.51%
Adjusted return on average common equity (1)  12.11%  9.82%  10.42%  11.92%  13.60%
Efficiency ratio (tax equivalent) (1)  58.91%  58.60%  60.37%  59.01%  58.07%
Full-time equivalent employees  1,187   1,224   995   988   1,043 
           
1 Non-GAAP financial measure. Refer to reconciliation to the comparable GAAP measure.         
           

FIRST MID BANCSHARES, INC.
Net Interest Margin
(In thousands, unaudited)
  For the Quarter Ended December 31, 2023
  QTD Average   Average
  Balance Interest Rate
INTEREST EARNING ASSETS      
Interest bearing deposits $186,849  $2,560 5.44%
Federal funds sold  8,842   122 5.47%
Certificates of deposits investments  1,630   54 13.14%
Investment Securities:      
  Taxable (total less municipals)  946,620   6,522 2.76%
  Tax-exempt (Municipals)  259,662   2,524 3.89%
Loans (net of unearned income)  5,544,706   78,938 5.65%
       
Total interest earning assets  6,948,309   90,720 5.18%
       
NONEARNING ASSETS      
Cash and due from banks  137,282     
Premises and equipment  101,641     
Other nonearning assets  618,063     
Allowance for loan losses  (68,584)    
       
Total assets $7,736,711     
       
INTEREST BEARING LIABILITIES      
Demand deposits $2,999,731  $16,077 2.13%
Savings deposits  724,347   190 0.10%
Time deposits  1,074,569   9,633 3.56%
Total interest bearing deposits  4,798,647   25,900 2.14%
Repurchase agreements  230,977   1,754 3.01%
FHLB advances  336,939   3,060 3.60%
Federal funds purchased  -   1 0.00%
Subordinated debt  106,684   1,193 4.44%
Jr. subordinated debentures  24,029   545 9.00%
Other debt  -   12 0.00%
Total borrowings  698,629   6,565 3.73%
Total interest bearing liabilities  5,497,276   32,465 2.34%
       
NONINTEREST BEARING LIABILITIES      
Demand deposits  1,463,572  Average cost of funds1.85%
Other liabilities  35,248     
Stockholders' equity  740,615     
       
Total liabilities & stockholders' equity $7,736,711     
       
Net Interest Earnings / Spread   $58,255 2.84%
       
Impact of Non-Interest Bearing Funds     0.49%
       
Tax effected yield on interest earning assets       3.33%
       

FIRST MID BANCSHARES, INC.
Reconciliation of Non-GAAP Financial Measures
(In thousands, unaudited)
           
  As of and for the Quarter Ended
  December 31, September 30, June 30, March 31, December 31,
  2023 2023 2023 2023 2022
           
Net interest income as reported $57,462  $50,443  $42,367  $43,191  $45,672 
Net interest income, (tax equivalent)  58,255   51,212   43,109   43,947   46,464 
Average earning assets  6,948,309   6,593,781   6,049,626   6,052,264   6,000,106 
Net interest margin (tax equivalent)  3.33%  3.06%  2.84%  2.94%  3.07%
           
           
Common stockholder's equity $793,204  $737,948  $660,687  $661,865  $633,155 
Goodwill and intangibles, net  264,231   267,793   178,615   168,373   169,897 
Common shares outstanding  23,827   23,830   20,528   20,520   20,452 
Tangible Book Value per common share $22.20  $19.73  $23.48  $24.05  $22.65 
Accumulated other comprehensive loss (AOCI)  (136,427)  (178,903)  (151,566)  (137,901)  (151,507)
Adjusted tangible book value per common share $27.93  $27.24  $30.87  $30.77  $30.06 
           

FIRST MID BANCSHARES, INC.
Reconciliation of Non-GAAP Financial Measures
(In thousands, except per share data, unaudited)
           
  As of and for the Quarter Ended
  December 31, September 30,June 30, March 31, December 31,
   2023   2023   2023   2023   2022 
Adjusted earnings Reconciliation          
Net Income - GAAP $18,071  $15,117  $16,567  $19,180  $20,639 
Adjustments (post-tax): (1)          
Acquisition ACL on non-PCD assets in provision expense  -   2,985   -   -   - 
Nonrecurring severance expense  -   -   -   416   - 
Net (gain)/loss on securities sales  (36)  (2,677)  -   -   - 
Integration and acquisition expenses  4,385   1,653   589   135   131 
Total non-recurring adjustments (non-GAAP) $4,348  $1,962  $589  $551  $131 
           
Adjusted earnings - non-GAAP $22,419  $17,079  $17,156  $19,731  $20,770 
Adjusted diluted earnings per share (non-GAAP) $0.94  $0.77  $0.83  $0.96  $1.01 
Adjusted return on average assets - non-GAAP  1.16%  0.94%  1.03%  1.18%  1.25%
Adjusted return on average common equity - non-GAAP  12.11%  9.82%  10.42%  11.92%  13.60%
           
Efficiency Ratio Reconciliation          
Noninterest expense - GAAP $57,025  $47,096  $40,042  $41,577  $39,372 
Other real estate owned property income (expense)  (800)  (902)  (27)  (133)  (87)
Amortization of intangibles  (3,560)  (2,568)  (1,477)  (1,522)  (1,537)
Nonrecurring severance expense  -   -   -   (527)  - 
Integration and acquisition expenses  (5,550)  (2,093)  (745)  (171)  (166)
  Adjusted noninterest expense (non-GAAP) $47,115  $41,533  $37,793  $39,224  $37,582 
           
Net interest income -GAAP $57,462  $50,443  $42,367  $43,192  $45,672 
Effect of tax-exempt income (1)  793   769   742   755   792 
  Adjusted net interest income (non-GAAP) $58,255  $51,212  $43,109  $43,947  $46,464 
           
Noninterest income - GAAP $21,768  $23,053  $19,486  $22,479  $18,207 
Net (gain)/loss on securities sales  (46)  (3,389)  6   46   48 
  Adjusted noninterest income (non-GAAP) $21,722  $19,664  $19,492  $22,525  $18,255 
           
  Adjusted total revenue (non-GAAP) $79,977  $70,876  $62,601  $66,472  $64,719 
           
Efficiency ratio (non-GAAP)  58.91%  58.60%  60.37%  59.01%  58.07%
           
(1) Nonrecurring items (post-tax) and tax-exempt income are calculated using an estimated effective tax rate of 21%.     

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Source: First Mid Bancshares, Inc.

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