What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-11-08 compared with 2024-08-07 · 192 added, 140 removed, 1146 unchanged (22% of the section changed)

3 unchanged sentences

(In thousands, except share data)

June 30, 2024

September 30, 2024

December 31, 2023

6 unchanged sentences

Investment securities:

Available-for-sale, at fair value (amortized cost of $ 1,311,109 and $ 1,363,721 at June 30, 2024 and December 31, 2023, respectively)

Held-to-maturity, at amortized cost (estimated fair value of $ 2,277 and $ 2,286 at June 30, 2024 and December 31, 2023, respectively)

Available-for-sale, at fair value (amortized cost of $ 1,274,661 and $ 1,363,721 at September 30, 2024 and December 31, 2023, respectively)

Held-to-maturity, at amortized cost (estimated fair value of $ 2,298 and $ 2,286 at September 30, 2024 and December 31, 2023, respectively)

Equity securities, at fair value

38 unchanged sentences

Three months ended

Six months ended

Nine months ended

September 30,

(In thousands, except per share data)

21 unchanged sentences

Service charges

Securities losses, net

Securities gains (losses), net

Mortgage banking revenue, net

22 unchanged sentences

Three months ended

Six months ended

Nine months ended

September 30,

(In thousands)

Other comprehensive income (loss)

Unrealized gains (losses) on available-for-sale securities, net of tax benefit (expense) of ($ 208 ) and ($ 5,583 ) for three months ended June 30, 2024 and 2023, respectively and $ 4,017 and $ 39 for the six months ended June 30, 2024 and 2023, respectively

reclassification adjustment for realized gains (losses) included in net income, net of tax benefit (expense) of $ 43 and $ 1 for three months ended June 30, 2024 and 2023, respectively and $ 43 and $ 14 for the six months ended June 30, 2024 and 2023, respectively

Unrealized gains (losses) on available-for-sale securities, net of tax benefit (expense) of ($ 11,316 ) and $ 10,183 for three months ended September 30, 2024 and 2023, respectively and ($ 7,300 ) and $ 10,223 for the nine months ended September 30, 2024 and 2023, respectively

reclassification adjustment for realized gains (losses) included in net income, net of tax benefit (expense) of $ 77 and ($ 983 ) for three months ended September 30, 2024 and 2023, respectively and $ 119 and ($ 968 ) for the nine months ended September 30, 2024 and 2023, respectively

Other comprehensive income (loss), net of taxes

3 unchanged sentences

Condensed Consolidated Statements of Changes in Stockholders’ Equity (unaudited)

For the three months ended June 30, 2024 and 2023

For the three months ended September 30, 2024 and 2023

(In thousands)

1 unchanged sentence

Income (Loss)

March 31, 2024

June 30, 2024

Other comprehensive income, net tax

2 unchanged sentences

Issuance of 9,384 common shares pursuant to the employee stock purchase plan

Grant of restricted units pursuant to 2017 stock incentive plan

Deferred compensation

Vested restricted shares/units compensation expense

September 30, 2024

June 30, 2023

March 31, 2023

Other comprehensive loss, net tax

Cash dividends on common stock ( .230 /share)

Forfeiture of 700 restricted shares pursuant to the 2017 stock incentive plan

Issuance of 11,624 common shares pursuant to the employee stock purchase plan

Issuance of 3,290,222 common shares pursuant to the acquisition of Blackhawk Bancorp, Inc., net proceeds

Deferred compensation

Vested restricted shares/units compensation expense

June 30, 2023

September 30, 2023

First Mid Bancshares, Inc.

Condensed Consolidated Statements of Changes in Stockholders’ Equity (unaudited)

For the six months ended June 30, 2024

For the nine months ended September 30, 2024

(In thousands)

10 unchanged sentences

Vested restricted shares/units compensation expense

June 30, 2024

September 30, 2024

First Mid Bancshares, Inc.

Condensed Consolidated Statements of Changes in Stockholders’ Equity (unaudited)

For the six months ended June 30, 2023

For the nine months ended September 30, 2023

(In thousands)

6 unchanged sentences

Issuance of 28,762 common shares pursuant to the employee stock purchase plan

Issuance of 3,290,222 common shares pursuant to the acquisition of Blackhawk Bancorp, Inc., net proceeds

Purchase of 170 shares of treasury stock

3 unchanged sentences

Vested restricted shares/units compensation expense

June 30, 2023

September 30, 2023

See accompanying notes to unaudited condensed consolidated financial statements.

1 unchanged sentence

Condensed Consolidated Stateme nts of Cash Flows (unaudited)

Six months ended June 30,

Nine months ended September 30,

(In thousands)

7 unchanged sentences

Operating lease payments

Loss on investment securities, net

Loss (gain) on investment securities, net

(Gain) loss on sales and write downs of other real estate owned, net

Loss on sale of other assets

Gain on sale of loans held for sale, net

4 unchanged sentences

Proceeds from sale of loans held for sale

Decrease in other assets

Decrease (increase) in other assets

Decrease in other liabilities

1 unchanged sentence

Cash flows from investing activities:

Proceeds from maturities of certificates of deposit investments

Purchases of certificates of deposit investments

1 unchanged sentence

Proceeds from maturities of securities available-for-sale

Proceeds from maturities of securities held-to-maturity

Purchases of securities available-for-sale

Purchase of securities held-to-maturity

Net decrease in loans

Net (increase) decrease in loans

Purchases of premises and equipment

Proceeds from sale of premises and equipment

Proceeds from sales of other real property owned

Proceeds from bank owned life insurance death benefit

Net cash used in acquisition

Net cash (used in) provided by acquisition

Net cash provided by investing activities

15 unchanged sentences

Condensed Consolidated Statements of Cash Flows (unaudited)

Six months ended June 30,

Nine months ended September 30,

(In thousands)

6 unchanged sentences

Initial recognition of lease liabilities

Dividends reinvested in common stock

Supplemental disclosures for purchases of capital stock

Fair value of assets acquired

Consideration paid:

Common stock issued

Total consideration paid

Fair value of liabilities assumed

Notes to Condensed Consolidated Financial Statements (unaudited)

6 unchanged sentences

All significant intercompany balances and transactions have been eliminated in consolidation.

The financial information reflects all adjustments which, in the opinion of management, are necessary for a fair presentation of the results of the interim periods ended June 30, 2024 and 2023, and all such adjustments are of a normal recurring nature.

Certain amounts in the prior year’s consolidated financial statements may have been reclassified to conform to the June 30, 2024 presentation and there was no impact on net income or stockholders’ equity.

The results of the interim period ended June 30, 2024 are not necessarily indicative of the results expected for the year ending December 31, 2024.

The financial information reflects all adjustments which, in the opinion of management, are necessary for a fair presentation of the results of the interim periods ended September 30, 2024 and 2023, and all such adjustments are of a normal recurring nature.

Certain amounts in the prior year’s consolidated financial statements may have been reclassified to conform to the September 30, 2024 presentation and there was no impact on net income or stockholders’ equity.

The results of the interim period ended September 30, 2024 are not necessarily indicative of the results expected for the year ending December 31, 2024.

The Company operates as a one-segment entity for financial reporting purposes.

21 unchanged sentences

There have been no stock options awarded under any Company plan since 2008.

The Company has awarded 53,766 and 59,950 shares of restricted stock during the six months ended June 30, 2024 and 2023, respectively, and 39,150 and 37,900 restricted stock units during the six months ended June 30, 2024 and 2023 , respectively.

The Company has awarded 53,766 and 60,550 shares of restricted stock during the nine months ended September 30, 2024 and 2023, respectively, and 39,150 and 37,900 restricted stock units during the nine months ended September 30, 2024 and 2023 , respectively.

Employee Stock Purchase Plan

4 unchanged sentences

A maximum of 600,000 shares of common stock may be issued under the ESPP.

During the six months ended June 30, 2024 and 2023, 15,935 shares and 17,138 shares, respectively, were issued pursuant to the ESPP.

During the nine months ended September 30, 2024 and 2023, 25,319 shares and 28,762 shares, respectively, were issued pursuant to the ESPP.

Captive Insurance Company

5 unchanged sentences

It has elected to be taxed under Section 831(b) of the Internal Revenue Code.

Pursuant to Section 831(b), if gross premiums do not exceed $ 2,800,000 , then the Captive is taxable solely on its investment income.

Pursuant to Section 831(b), if gross premiums do not exceed $ 2.8 million , then the Captive is taxable solely on its investment income.

The Captive is included in the Company's consolidated financial statements and its federal income return.

33 unchanged sentences

Accumulated Other Comprehensive Loss

The components of accumulated other comprehensive loss included in stockholders’ equity as of June 30, 2024 and December 31, 2023 are as follows (in thousands):

The components of accumulated other comprehensive loss included in stockholders’ equity as of September 30, 2024 and December 31, 2023 are as follows (in thousands):

Unrealized Losses on Securities

June 30, 2024

September 30, 2024

Net unrealized losses on securities available-for-sale

Balance at June 30, 2024

Balance at September 30, 2024

December 31, 2023

1 unchanged sentence

Balance at December 31, 2023

Amounts reclassified from accumulated other comprehensive loss and the affected line items in the statements of income during the three and six months ended June 30, 2024 and 2023, were as follows (in thousands):

Amounts reclassified from accumulated other comprehensive loss and the affected line items in the statements of income during the three and nine months ended September 30, 2024 and 2023, were as follows (in thousands):

Amounts Reclassified from

1 unchanged sentence

Three months ended

Six months ended

Nine months ended

September 30,

Affected Line Item in the Statements of Income

12 unchanged sentences

The adoption of this accounting pronouncement will have no impact on the Financial Statements aside from additional disclosures presented in the Notes to Consolidated Financial Statements.

In November 2023, the Financial Accounting Standards Board issued ASU No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures.

The amendments in this update require annual and interim disclosures on significant segment expenses that are regularly provided to the chief operating decision maker and require annual and interim disclosures on “other segment items” that comprise the difference between segment revenue less segment expense compared to the reported measure of segment profit or loss.

In addition, the amendments will require all annual disclosures that are currently required to be reported on an interim basis and requires disclosure of the title and position of the chief operating decision maker and how that position uses the information to assess segment performance and the allocation of resources.

ASU 2023-07 also requires entities that have a single reportable segment, such as the Company, to provide all disclosures required in this update and the existing segment disclosures in Topic 280.

The amendments in this update are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

The Company is evaluating the accounting and disclosure requirements of ASU 2023-07 and does not expect them to have a material effect on the consolidated financial statements.

Note 2 -- Earnings Per Share

1 unchanged sentence

Diluted net income per common share available to common stockholders is computed using the weighted average number of common shares outstanding, increased by the Company’s stock options, unless anti-dilutive.

The components of basic and diluted net income per common share available to common stockholders for the three and six months ended June 30, 2024 and 2023 were as follows:

The components of basic and diluted net income per common share available to common stockholders for the three and nine months ended September 30, 2024 and 2023 were as follows:

Three months ended

Six months ended

Nine months ended

September 30,

Basic net income per common share

10 unchanged sentences

Diluted earnings per common share

There were no shares excluded when computing diluted earnings per share for the three and six months ended June 30, 2024 and 2023 because they were anti-dilutive.

There were no shares excluded when computing diluted earnings per share for the three and nine months ended September 30, 2024 and 2023 because they were anti-dilutive.

Note 3 -- Investment Securities

The amortized cost, gross unrealized gains and losses and estimated fair values for available-for-sale and held-to-maturity securities by major security type at June 30, 2024 and December 31, 2023 were as follows (in thousands):

June 30, 2024

The amortized cost, gross unrealized gains and losses and estimated fair values for available-for-sale and held-to-maturity securities by major security type at September 30, 2024 and December 31, 2023 were as follows (in thousands):

September 30, 2024

Available-for-sale:

21 unchanged sentences

Total held-to-maturity

The Company also had $ 4,258,000 and $ 4,074,000 of equity securities, at fair value, as of June 30, 2024 and December 31, 2023, respectively.

The Company also had $ 4.4 million and $ 4.1 million of equity securities, at fair value, as of September 30, 2024 and December 31, 2023, respectively.

The Company's held-to-maturity securities are annuities for which the risk of loss is minimal.

As such, as of June 30, 2024, the Company did not record an allowance for credit losses on its held-to-maturity securities.

Realized gains and losses resulting from sales of securities were as follows during the three and six months ended June 30, 2024 and 2023 (in thousands):

As such, as of September 30, 2024, the Company did not record an allowance for credit losses on its held-to-maturity securities.

Realized gains and losses resulting from sales of securities were as follows during the three and nine months ended September 30, 2024 and 2023 (in thousands):

Three months ended

Six months ended

The following table indicates the expected maturities of investment securities classified as available-for-sale presented at fair value, and held-to-maturity presented at amortized cost, at June 30, 2024 and the weighted average yield for each range of maturities (dollars in thousands):

Nine months ended

September 30,

The following table indicates the expected maturities of investment securities classified as available-for-sale presented at fair value, and held-to-maturity presented at amortized cost, at September 30, 2024 and the weighted average yield for each range of maturities (dollars in thousands):

Available-for-sale:

17 unchanged sentences

Treasury and other U.S.

government agencies and corporations, there were no investment securities of any single issuer, the book value of which exceeded 10 % of stockholders' equity at June 30, 2024.

Investment securities carried at approximately $ 728 million and $ 831 million at June 30, 2024 and December 31, 2023, respectively, were pledged to secure public deposits and repurchase agreements and for other purposes as permitted or required by law.

The following table presents the aging of gross unrealized losses and fair value by investment category as of June 30, 2024 and December 31, 2023 (in thousands):

government agencies and corporations, there were no investment securities of any single issuer, the book value of which exceeded 10 % of stockholders' equity at September 30, 2024.

Investment securities carried at approximately $ 834.1 million and $ 831.0 million at September 30, 2024 and December 31, 2023, respectively, were pledged to secure public deposits and repurchase agreements and for other purposes as permitted or required by law.

The following table presents the aging of gross unrealized losses and fair value by investment category as of September 30, 2024 and December 31, 2023 (in thousands):

Less than 12 months

12 months or more

June 30, 2024

September 30, 2024

Available-for-sale:

15 unchanged sentences

Government Corporations and Agencies.

At June 30, 2024 there were thirty-two available-for-sale securities with a fair value of $ 196.3 million and unrealized losses of $ 25.2 million in a continuous unrealized loss position for twelve months or more.

At September 30, 2024 there were twenty-eight available-for-sale securities with a fair value of $ 193.5 million and unrealized losses of $ 18.1 million in a continuous unrealized loss position for twelve months or more.

At December 31, 2023, there were thirty-six available-for-sale securities with a fair value of $ 210.1 million and unrealized losses of $ 26.2 million in a continuous unrealized loss position for twelve months or more.

3 unchanged sentences

Obligations of states and political subdivisions.

At June 30, 2024, there were zero obligations of states and political subdivisions with a fair value of $ 247.1 million and unrealized losses of $ 56.1 million in a continuous unrealized loss position for twelve months or more.

At September 30, 2024, there were two hundred forty-seven obligations of states and political subdivisions with a fair value of $ 251.1 million and unrealized losses of $ 45.7 million in a continuous unrealized loss position for twelve months or more.

At December 31, 2023 there were two hundred thirty-seven obligations of states and political subdivisions with a fair value of $ 241.6 million and unrealized losses of $ 49.0 million in a continuous unrealized loss position for twelve months or more.

1 unchanged sentence

GSE Residential.

At June 30, 2024, there were two hundred fifty mortgage-backed securities with a fair value of $ 535.9 million and unrealized losses of $ 114.5 million in a continuous unrealized loss position for twelve months or more.

At September 30, 2024, there were two hundred forty-two mortgage-backed securities with a fair value of $ 547.2 million and unrealized losses of $ 93.3 million in a continuous unrealized loss position for twelve months or more.

At December 31, 2023, there were two hundred sixty-three mortgage-backed securities with a fair value of $ 566.2 million and unrealized losses of $ 113.0 million in a continuous unrealized loss position for twelve months or more.

Other securities.

At June 30, 2024, there were forty other securities with a fair value of $ 57.2 million and unrealized losses of $ 4.1 million in a continuous unrealized loss position for twelve months or more.

At September 30, 2024, there were forty other securities with a fair value of $ 58.3 million and unrealized losses of $ 3.0 million in a continuous unrealized loss position for twelve months or more.

At December 31, 2023, there were forty-three other securities with a fair value of $ 57.9 million and unrealized losses of $ 4.4 million in a continuous unrealized loss position for twelve months or more.

4 unchanged sentences

Interest on substantially all loans is credited to income based on the principal amount outstanding.

A summary of loans at June 30, 2024 and December 31, 2023 follows (in thousands):

June 30, 2024

A summary of loans at September 30, 2024 and December 31, 2023 follows (in thousands):

September 30, 2024

December 31, 2023

15 unchanged sentences

These loans are primarily for 1-4 family residential properties.

Accrued interest on loans, which is excluded from the amortized cost of the balances above, totaled $ 32.3 million and $ 29.9 million at June 30, 2024 and December 31, 2023, respectively.

Accrued interest on loans, which is excluded from the amortized cost of the balances above, totaled $ 32.5 million and $ 29.9 million at September 30, 2024 and December 31, 2023, respectively.

Most of the Company’s business activities are with customers located near the Company's branch locations in Illinois, Missouri, Texas, and Wisconsin.

At June 30, 2024, the Company’s loan portfolio included $ 601.6 million of loans to borrowers whose businesses are directly related to agriculture.

At September 30, 2024, the Company’s loan portfolio included $ 618.4 million of loans to borrowers whose businesses are directly related to agriculture.

Of this amount, $ 508.2 million was concentrated in corn and other grain farming.

21 unchanged sentences

The Company’s commercial real estate portfolio is below the thresholds that would designate a concentration in commercial real estate lending, as established by the federal banking regulators.

The following table represents the gross commercial real estate loans by property type as of June 30, 2024 (in thousands):

June 30, 2024

The following table represents the gross commercial real estate loans by property type as of September 30, 2024 (in thousands):

September 30, 2024

Commercial real estate

2 unchanged sentences

Shopping centers and malls

Hotels and motels

Industrial and warehouse

Hotels and motels

Skilled nursing facility

Medical office

Assisted living facility

Medical office

Other property types

71 unchanged sentences

While inflationary pressures have caused some risk in this segment, most projects are associated with financially strong borrowers.

The qualitative factors for this segment, on a net basis, declined by a minor amount for the quarter due to balances falling below an internal concentration threshold.

The qualitative factors for this segment increased by a minor amount for the quarter due to balances hitting 90 % of an internal concentration threshold.

Agricultural Real Estate Loans.

13 unchanged sentences

Commercial Real Estate Owner Occupied Loans.

This segment has remained stable, despite macro concerns over commercial real estate.

The Company has previously increased qualitative factors for those conditions, but believes the stability in the portfolio for the period did not require the need for additional adjustments.

This segment has remained stable, despite macro segment concerns over commercial real estate.

The Company has previously increased qualitative factors for those conditions, but believes the stability in the portfolio and improvement in the macro-economic environment warranted a moderate decrease in the factor for the period.

Commercial Real Estate Non Owner Occupied Loans.

3 unchanged sentences

Losses in this segment are very low.

Commodity prices have been volatile but yield expectations are increasing from previous concerns from the weather.

The qualitative factors of this segment were increased in prior periods and the Company

did not believe any further increase was warranted in this period.

Commodity prices have remained depressed for an extended period but yields have experienced increases from previous concerns from the weather.

The qualitative factors of this segment were increased in

prior periods and the Company added to the factor again at a minor level.

Commercial and Industrial Loans.

20 unchanged sentences

The subsequent measurement of expected credit losses for all acquired loans is the same as the subsequent measurement of expected credit losses for originated loans.

The following table presents the activity in the allowance for credit losses based on portfolio segment for the three and six months ended June 30, 2024 (in thousands):

The following table presents the activity in the allowance for credit losses based on portfolio segment for the three and nine months ended September 30, 2024 (in thousands):

and Industrial

Three months ended

June 30, 2024

September 30, 2024

Beginning balance

3 unchanged sentences

Ending balance

Six months ended

June 30, 2024

Nine months ended

September 30, 2024

Beginning balance

3 unchanged sentences

Ending balance

The following tables present the activity in the allowance for credit losses based on portfolio segment for the three and six months ended June 30, 2023 and for the year ended December 31, 2023 (in thousands):

The following tables present the activity in the allowance for credit losses based on portfolio segment for the three and nine months ended September 30, 2023 and for the year ended December 31, 2023 (in thousands):

Construction and Land Development

6 unchanged sentences

Three months ended

June 30, 2023

September 30, 2023

Beginning balance

Initial allowance on loans purchased with credit deterioration

Provision for credit loss expense

2 unchanged sentences

Ending balance

Six months ended

June 30, 2023

Nine months ended

September 30, 2023

Beginning balance

Initial allowance on loans purchased with credit deterioration

Provision for credit loss expense

17 unchanged sentences

Loans at these respective delinquency thresholds for which the Company can clearly document that the loan is both well-secured and in the process of collection, such that collection will occur regardless of delinquency status, need not be charged off.

The following table presents the amortized cost basis of collateral-dependent loans by class of loans that were individually evaluated to determine expected credit losses, and the related allowance for credit losses, as of June 30, 2024 (in thousands):

Agricultural real estate

1-4 family residential properties

17 unchanged sentences

Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered pass rated loans.

The following tables present the credit risk profile of the Company’s loan portfolio on amortized cost basis based on risk rating category and year of origination as of June 30, 2024 (in thousands):

The following tables present the credit risk profile of the Company’s loan portfolio on amortized cost basis based on risk rating category and year of origination as of September 30, 2024 (in thousands):

Term Loans by Origination Year

June 30, 2024

September 30, 2024

Construction and land development loans

47 unchanged sentences

Current period gross writeoffs

The following table presents the Company’s loan portfolio aging analysis at June 30, 2024 and December 31, 2023 (in thousands):

The following table presents the Company’s loan portfolio aging analysis at September 30, 2024 and December 31, 2023 (in thousands):

> 90 Days and

June 30, 2024

September 30, 2024

Construction and land development

36 unchanged sentences

Non-Accrual Loans

The following table presents the amortized cost basis of loans on nonaccrual status and of nonaccrual loans individually evaluated for which no allowance was recorded as of June 30, 2024 and December 31, 2023 (in thousands).

The following table presents the amortized cost basis of loans on nonaccrual status and of nonaccrual loans individually evaluated for which no allowance was recorded as of September 30, 2024 and December 31, 2023 (in thousands).

There were no loans past due over eighty-nine days that were still accruing.

June 30, 2024

September 30, 2024

December 31, 2023

8 unchanged sentences

Consumer loans

Interest income that would have been recorded under the original terms of such nonaccrual loans totaled $ 487,000 and $ 122,000 for the six months ended June 30, 2024 and 2023, respectively.

Interest income that would have been recorded under the original terms of such nonaccrual loans totaled $ 516,000 and $ 173,000 for the nine months ended September 30, 2024 and 2023, respectively.

Loan Modification Disclosures Pursuant to ASU 2022-02

The following table shows the amortized cost of loans at June 30, 2024 and 2023 that were both experiencing financial difficulty and modified segregated by portfolio segment and type of modification.

The following table shows the amortized cost of loans at September 30, 2024 and 2023 that were both experiencing financial difficulty and modified segregated by portfolio segment and type of modification.

The percentage of the amortized cost of loans that were modified to borrowers in financial distress as compared to outstanding loans is also presented below.

Modifications

June 30, 2024

September 30, 2024

Agricultural real estate

4 unchanged sentences

Consumer loans

June 30, 2023

September 30, 2023

Agricultural real estate

5 unchanged sentences

The Company closely monitors the performance of loans that have been modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts.

The following table shows the performance of such loans that have been modified in the last twelve months ended June 30, 2024 and 2023.

June 30, 2024

The following table shows the performance of such loans that have been modified in the last twelve months ended September 30, 2024 and 2023.

September 30, 2024

1-4 family residential properties

Commercial real estate

Loans secured by real estate

1 unchanged sentence

Consumer loans

June 30, 2023

September 30, 2023

1-4 family residential properties

Loans secured by real estate

Commercial and industrial loans

Consumer loans

The following table shows the financial effect of loan modifications during the current quarter to borrowers experiencing financial difficulty for the three and six months ended June 30, 2024 and 2023.

The following table shows the financial effect of loan modifications during the current quarter to borrowers experiencing financial difficulty for the three months ended September 30, 2024 and 2023.

Weighted Average

2 unchanged sentences

Term Extension

June 30, 2024

September 30, 2024

Commercial and industrial loans

Consumer loans

June 30, 2023

September 30, 2023

Commercial and industrial loans

1 unchanged sentence

A loan is considered to be in payment default once it is 90 days past due under the modified terms.

There were no loans modified during the prior twelve months that experienced defaults for six months ended June 30, 2024 or for the three and six months ended June 30, 2023.

There were no loans modified during the prior twelve months that experienced defaults for nine months ended September 30, 2024 or for the three and nine months ended September 30, 2023.

Purchased Credit Deteriorated (PCD) Loans

7 unchanged sentences

The Company has goodwill from business combinations, intangible assets from branch acquisitions, identifiable intangible assets assigned to core deposit relationships and customer lists of First Mid Wealth Management Company and First Mid Insurance.

The following table presents gross carrying value and accumulated amortization by major intangible asset class as of June 30, 2024 and December 31, 2023 (in thousands):

June 30, 2024

The following table presents gross carrying value and accumulated amortization by major intangible asset class as of September 30, 2024 and December 31, 2023 (in thousands):

September 30, 2024

December 31, 2023

16 unchanged sentences

Fair value of time deposits

Fair value of subordinated and jr subordinated debentures

Fair value of subordinated and junior subordinated debentures

Increase in core deposit intangible

Increase in mortgage servicing rights

During the quarter ended September 30, 2024, goodwill of $ 6.9 million was recorded for the acquisition of the stock of Mid Rivers Insurance Group, Inc.

(MRIG) in connection with its insurance business.

First Mid Insurance was assigned all this goodwill.

The following provides a reconciliation of the purchase price paid for Mid Rivers Insurance Group, Inc.

and the amount of goodwill recorded (in thousands):

Unallocated purchase price

Less purchase accounting adjustments:

Insurance Company intangible

Other liabilities

During the quarter ended June 30, 2023, goodwill of $ 6.0 million was recorded for the acquisition of the stock of Purdum, Gray, Ingledue, Beck, Inc., in connection with its insurance business.

7 unchanged sentences

The Company has mortgage servicing rights acquired in previous acquisitions.

The following table summarizes the activity pertaining to mortgage servicing rights included in intangible assets as of June 30, 2024, June 30, 2023 and December 31, 2023 (in thousands):

June 30, 2024

June 30, 2023

The following table summarizes the activity pertaining to mortgage servicing rights included in intangible assets as of September 30, 2024, September 30, 2023 and December 31, 2023 (in thousands):

September 30, 2024

September 30, 2023

December 31, 2023

5 unchanged sentences

Ending balance

Total amortization expense for three and six months ended June 30, 2024 and 2023 was as follows (in thousands):

Total amortization expense for three and nine months ended September 30, 2024 and 2023 was as follows (in thousands):

Three months ended

Six months ended

Nine months ended

September 30,

Core deposit intangibles

11 unchanged sentences

In accordance with the provisions of SFAS No.

142, “ Goodwill and Other Intangible Assets ,” codified within ASC 350, the Company performed testing of goodwill for impairment as of May 31, 2023 and determined that, as of that date, goodwill was not impaired.

142, “ Goodwill and Other Intangible Assets ,” codified within ASC 350, the Company performed testing of goodwill for impairment as of September 30, 2024 and determined that, as of that date, goodwill was not impaired.

Management also concluded that the remaining amounts and amortization periods were appropriate for all intangible assets.

Note 6 -- Repurchase Agreements and Other Borrowings

Securities sold under agreements to repurchase were $ 206.0 million at June 30, 2024, an decrease of $ 7.8 million from $ 213.7 million at December 31, 2023.

Securities sold under agreements to repurchase were $ 204.3 million at September 30, 2024, a decrease of $ 9.4 million from $ 213.7 million at December 31, 2023.

All the transactions have overnight maturities with a weighted average rate of 3.05 % .

7 unchanged sentences

Collateral pledged by class for repurchase agreements are as follows (in thousands):

June 30, 2024

September 30, 2024

December 31, 2023

2 unchanged sentences

Mortgage-backed securities:

Gross FHLB borrowings, were $ 263.6 million and $ 263.6 million at June 30, 2024 and December 31, 2023, respectively.

At June 30, 2024 the advances were as follows:

Gross FHLB borrowings, were $ 238.6 million and $ 263.6 million at September 30, 2024 and December 31, 2023, respectively.

At September 30, 2024 the advances were as follows:

Term (in years)

9 unchanged sentences

June 27, 2029

October 3, 2029

25 unchanged sentences

The fair value of derivatives is based on models using observable market data as of the measurement date and are therefore classified in Level 2 of the valuation hierarchy.

The following table presents the Company’s assets and liabilities that are measured at fair value on a recurring basis and the level within the fair value hierarchy in which the fair value measurements fall as of June 30, 2024 and December 31, 2023 (in thousands):

The following table presents the Company’s assets and liabilities that are measured at fair value on a recurring basis and the level within the fair value hierarchy in which the fair value measurements fall as of September 30, 2024 and December 31, 2023 (in thousands):

Fair Value Measurements Using

2 unchanged sentences

for Identical

June 30, 2024

September 30, 2024

Available-for-sale securities:

25 unchanged sentences

interest swaps

The change in fair value of assets measured on a recurring basis using significant unobservable inputs (Level 3) for the three and six months ended June 30, 2024 and 2023 is summarized as follows (in thousands):

Three months ended June 30, 2024

Six months ended June 30, 2024

The change in fair value of assets measured on a recurring basis using significant unobservable inputs (Level 3) for the three and nine months ended September 30, 2024 and 2023 is summarized as follows (in thousands):

Three months ended September 30, 2024

Nine months ended September 30, 2024

Obligation of State and Political Subdivisions

3 unchanged sentences

Ending balance

Three months ended June 30, 2023

Six months ended June 30, 2023

Three months ended September 30, 2023

Nine months ended September 30, 2023

Obligation of State and Political Subdivisions

12 unchanged sentences

Management establishes a specific allowance for individually evaluated loans that have an estimated fair value that is below the carrying value.

The total carrying amount of loans for which a change in specific allowance has occurred as of June 30, 2024 was $ 899,000 and a fair value of $ 597,000 resulting in specific loss exposures of $ 302,000 .

The total carrying amount of loans for which a change in specific allowance has occurred as of September 30, 2024 was $ 594,000 and a fair value of $ 579,000 resulting in specific loss exposures of $ 15,000 .

When there is little prospect of collecting principal or interest, loans, or portions of loans, may be charged-off to the allowance for credit losses.

8 unchanged sentences

Gains and losses on the disposition of other real estate owned and foreclosed assets are netted and posted to other noninterest expense.

The total carrying amount of other real estate owned as of June 30, 2024 was $ 1.5 million .

The total carrying amount of other real estate owned as of September 30, 2024 was $ 1.8 million .

Other real estate owned included in the total carrying amount and measured at fair value on a nonrecurring basis during the period amounted to $ 47,000 .

The following table presents the fair value measurement of assets measured at fair value on a nonrecurring basis and the level within the fair value hierarchy in which the fair value measurements fall at June 30, 2024 and December 31, 2023 (in thousands):

The following table presents the fair value measurement of assets measured at fair value on a nonrecurring basis and the level within the fair value hierarchy in which the fair value measurements fall at September 30, 2024 and December 31, 2023 (in thousands):

Fair Value Measurements Using

2 unchanged sentences

for Identical

June 30, 2024

September 30, 2024

Collateral dependent loans

4 unchanged sentences

Sensitivity of Significant Unobservable Inputs

The following table presents quantitative information about unobservable inputs used in Level 3 fair value measurements other than goodwill at June 30, 2024 and December 31, 2023.

June 30, 2024

The following table presents quantitative information about unobservable inputs used in Level 3 fair value measurements other than goodwill at September 30, 2024 and December 31, 2023.

September 30, 2024

Unobservable Inputs

11 unchanged sentences

Discount to reflect realizable value less estimated selling costs

The following tables present estimated fair values of the Company’s financial instruments at June 30, 2024 and December 31, 2023 in accordance with ASC 825 (in thousands):

June 30, 2024

The following tables present estimated fair values of the Company’s financial instruments at September 30, 2024 and December 31, 2023 in accordance with ASC 825 (in thousands):

September 30, 2024

Financial assets

108 unchanged sentences

Three months ended

Six months ended

Nine months ended

September 30,

Net interest income

8 unchanged sentences

Acquisition costs are expensed as incurred as a component of non-interest expense and primarily include, but are not limited to, severance costs, professional services, data processing fees, and marketing and advertising expenses.

The Company incurred acquisition costs related to the Blackhawk acquisition, pre-tax, of $ 2.38 million and $ 561,000 , respectively, during the six months ended June 30, 2024 and June 30, 2023 and $ 175,000 and $ 468,000 , respectively, during the three months ended June 30, 2024 and June 30, 2023.

The Company incurred acquisition costs related to the Blackhawk acquisition, pre-tax, of $ 2.5 million and $ 2.6 million, respectively, during the nine months ended September 30, 2024 and 2023 and $ 0.1 million and $ 2.1 million, respectively, during the three months ended September 30, 2024 and 2023 .

Note 9 -- Leases

Effective January 1, 2019, the Company adopted ASU 2016-02, Leases (Topic 842).

As of June 30, 2024, substantially all the Company's leases are operating leases for real estate property for bank branches, ATM locations, and office space.

As of September 30, 2024, substantially all the Company's leases are operating leases for real estate property for bank branches, ATM locations, and office space.

These leases are generally for periods of 1 to 25 years with various renewal options.

13 unchanged sentences

The following table contains supplemental balance sheet information related to leases (dollars in thousands):

June 30, 2024

June 30, 2023

September 30, 2024

September 30, 2023

December 31, 2023

12 unchanged sentences

Total lease liability

The components of lease expense for the three and six months ended June 30, 2024 and 2023 were as follows (in thousands):

The components of lease expense for the three and nine months ended September 30, 2024 and 2023 were as follows (in thousands):

Three months ended

Six months ended

Nine months ended

September 30,

Operating lease cost

7 unchanged sentences

Cash paid for amounts included in the measurement of lease liabilities was (in thousands):

June 30, 2024

June 30, 2023

September 30, 2024

September 30, 2023

Operating cash flows from operating leases

3 unchanged sentences

Derivatives Designated as Hedging Instruments

The following table provides the outstanding notional balances and fair values of outstanding derivatives designated as hedging instruments as of June 30, 2024 and December 31, 2023 (in thousands):

June 30, 2024

The following table provides the outstanding notional balances and fair values of outstanding derivatives designated as hedging instruments as of September 30, 2024 and December 31, 2023 (in thousands):

September 30, 2024

Fair value hedges:

5 unchanged sentences

Other liabilities

The effects of the fair value hedges on the Company's income statement during the three and six months ended June 30, 2024 and 2023 were as follows (in thousands):

The effects of the fair value hedges on the Company's income statement during the three and nine months ended September 30, 2024 and 2023 were as follows (in thousands):

Three months ended

Six months ended

Nine months ended

September 30,

Location of Gain (Loss) on Derivatives

2 unchanged sentences

Three months ended

Six months ended

Nine months ended

September 30,

Location of Gain (Loss) on Hedged Items

1 unchanged sentence

Interest income on loans

As of June 30, 2024, the following amounts were recorded on the consolidated balance sheet related to cumulative basis adjustment for fair value hedges (in thousands):

As of September 30, 2024, the following amounts were recorded on the consolidated balance sheet related to cumulative basis adjustment for fair value hedges (in thousands):

Line Item in the Balance Sheet in Which

5 unchanged sentences

Derivatives Not Designated as Hedging Instruments

The following amounts represent the notional amounts and gross fair value of derivative contracts not designated as hedging instruments outstanding during the six months ended June 30, 2024 (dollars in thousands):

June 30, 2024

The following amounts represent the notional amounts and gross fair value of derivative contracts not designated as hedging instruments outstanding during the nine months ended September 30, 2024 (dollars in thousands):

September 30, 2024

Interest rate swap agreements

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements