FINANCIAL UPDATE Remaining Consistent Despite COVID


ROGER MEALY, EVP/Chief Financial Officer, Midwest Independent Bancshares, Inc.


rmealy@mibanc.com


Assets totaled $249 million at the end of the third quarter. This level is somewhat below our average for the year but was consistent throughout the quarter. This is lower than our historical numbers primarily due to the Federal Reserve eliminating the deposit reserve requirement in March, which amounted to a decrease in our Fed required average balance by $42 million, and therefore, lowering our total assets. MIB operates at a much higher level


than our asset size would suggest. At the end of the quarter, we had just under $8 billion in assets under management – reaching all-time highs. This amount not only includes the book assets, but loans sold downstream to respondent banks, Fed Funds pool, EBA pool, and safekeeping assets. Our fed funds and EBA pools continue at high levels and averaged about $2.5 billion during the quarter alone, well over historical levels. MIB continues to be extremely well


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capitalized with a Common Equity Tier 1 Capital Ratio (CET1) of 21.0 percent, a Tier 1 Leverage Ratio of 15.9 percent, and Total Capital Ratio of 22.2 percent. Our loan portfolio totaled $140 million


at the end of the quarter, a decrease of $5 million during the quarter. We have a concentration in bank stock loans which historically pay back faster than commercial loans, and when banks have “good” years they may pay down at an accelerated rate, which can create some volatility in the portfolio.


MIB has no OREO properties,


classified assets, past dues, or delinquent loans at the end of the quarter, so our asset quality remains excellent. We have had very few requests for payment modifications due to COVID-19. Our investment portfolio remained


flat at $27 million at the end of the quarter versus the prior quarter-end despite the continuation of multiple calls and some maturities. We continue to work diligently in conjunction with First Bankers’ Banc Securities, Inc. to keep our investment portfolio conservative and sound. Total deposits at quarter-end were


$201 million, a decline from the prior quarter-end which was at our highest level of the year. Our DDA accounts, however, remain above historical levels as our customer banks continue to have good liquidity. We have seen healthy balance levels all year long. Net earnings of Midwest Independent


BankersBank through the third quarter of 2020 total $2.3 million, delivering an ROA of 1.09 percent – good earnings combined with lower-than-historical assets. We have now surpassed total year earnings from 2019. We have had some one-time expense savings due to COVID-19 impacts related to travel, entertainment, events, sports tickets, etc. which has certainly helped contribute to the bottom line.


4 MIDWEST INDEPENDENT BANKERSBANK MIBANC.com


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