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Mar 31, 2020
MidwestOne Q1 2020 Earnings Report
Reported a net loss due to credit loss expense, but saw increases in noninterest income and decreases in noninterest expenses.
Key Takeaways
MidwestOne Financial Group, Inc. reported a net loss for the first quarter of 2020 of $2.0 million, or $0.12 per diluted common share. The quarter was dominated by the activity to prepare and deal with the effects of the COVID-19 pandemic. Credit loss expense for the first quarter was $21.7 million, which reduced diluted earnings per common share by approximately $0.99.
Approved approximately $332 million of PPP loans for 2,190 customers through April 28, 2020.
Net Loss of $2.0 million, or a Loss of $0.12 Per Diluted Share due to Credit Loss Expense of $21.7 million
Pre-tax, Pre-provision Net Revenue of $17.6 million, an increase of $5.4 million.
Ending deposit balances rose $131.2 million, or 4%, from year-end 2019
Revenue by Segment
Forward Guidance
The company expects net interest margin improvement in the second quarter as funding costs are adjusted.
Positive Outlook
- Expect to see net interest margin improvement in the second quarter as funding costs are adjusted.
- Online banking user sessions and online account openings increased.
- Excellent deposit growth.
- Very good fee income across our footprint.
- Improved expense management.
Challenges Ahead
- The quarter was dominated by the activity to prepare and deal with the effects of the COVID-19 pandemic on our employees, customers and communities.
- Credit loss expense of $21.7 million is related to the worsening forecast for the U.S. and our regional economy due to the significant slowing we’ve seen in current and forecasted economic activity.
- Net interest income decreased in the first quarter of 2020 to $37.4 million from $39.6 million in the linked quarter, reflecting net interest margin compression and lower loan purchase discount accretion.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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