8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported):
APRIL 30, 2014
FIRST MID-ILLINOIS BANCSHARES, INC.
(Exact name of registrant as specified in its charter)
Delaware	0-13368		37-1103704
(State of other jurisdiction	(Commission File Number)		(IRS Employer
of incorporation)			Identification No.)
1421 CHARLESTON AVENUE
MATTOON, IL		61938
(Address of principal executive offices)		(Zip Code)
(217) 234-7454
(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[ ]	Written communications pursuant to Rule 425 under the Securities Act (17CFR 230.425)
[ ]	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17CFR 240.14a-12)
[ ]	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17CFR 240.14d-2(b))
[ ]	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17CFR 240.13e-4(c))

Item 2.02.     Results of Operations and Financial Condition.

Incorporated by reference is the quarterly report to stockholders issued by First Mid-Illinois Bancshares, Inc. (the "Company") on April 30, 2014, attached as Exhibit 99.1, providing information concerning the Company's financial statements and operations as of March 31, 2014.

Item 8.01     Other Events.

On April 28, 2014, the Company was notified by The NASDAQ Stock Market LLC that it is authorized to transfer its common stock and related common stock purchase rights from the OTC Bulletin Board to a listing on the NASDAQ Global Market. The Company expects to begin trading on the NASDAQ Global Market on May 12, 2014. Until the transfer is complete, the Company's common stock will continue to be quoted on the OTC Bulletin Board. Following the transfer to the NASDAQ Global Market, the Company's common stock will continue to trade under the ticker symbol "FMBH."

The Company issued a press release on April 30, 2014 regarding this transfer. A copy of the press release is attached as Exhibit 99.2 and is incorporated by reference herein.

Item 9.01.     Financial Statements and Exhibits.

(d)  Exhibits

Exhibit 99.1     Quarterly Report to Stockholders as of and for the period ending March 31, 2014

Exhibit 99.2    Press Release, April 30, 2014

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.

FIRST MID-ILLINOIS BANCSHARES, INC.

Dated: April 30, 2014

By:    

Joseph R. Dively

Chairman and Chief Executive Officer

INDEX TO EXHIBITS

Exhibit
Number	Description
99.1	Quarterly Report to Stockholders
99.2	Press Release, April 30, 2014

EX-99.1

Exhibit 99.1

QUARTERLY REPORT TO STOCKHOLDERS

2014 FIRST QUARTER

First Mid Announces:

* NASDAQ Global Market Exchange Listing

* Growth in Earnings and Earnings Per Share

* Strength in Asset Quality Metrics

* Enhancements in Technology

I am excited to announce that the common stock for First Mid-Illinois Bancshares, Inc. has been approved for listing on The NASDAQ Stock Market LLC (“NASDAQ”) under our ticker symbol “FMBH”. Trading on NASDAQ is expected to begin May 12, 2014. Until that date, the Company’s common stock will continue trading on the OTC Bulletin Board. We believe moving to NASDAQ is a significant step in our ongoing strategy to enhance shareholder value. This action will increase the Company’s visibility in the marketplace, resulting in an increase in the universe of potential investors in the Company and greater liquidity and efficiency in our stock trading. You will notice that we have enhanced the Quarterly Report format by adding quarterly financial information in addition to year-to-date and providing key financial ratios. We hope that this will provide shareholders useful financial information about First Mid in a condensed format to supplement the SEC Forms 10-Q and 10-K.

I am also pleased to report that First Mid-Illinois Bancshares, Inc. has started 2014 well with growth in earnings and earnings per share. Net income for the first quarter of 2014 was $3,607,000 compared to $3,528,000 for the first quarter of 2013. On a per share basis, diluted earnings per share was $.43 for the first three months of 2014 compared to $.41 for the same period last year.

Net income for the first quarter of 2014 was higher than last year as we increased net interest income with growth in loans and a higher net interest margin, reduced the provision for loan losses with lower non-performing assets and net recoveries for the quarter, and increased fees for trust and wealth management and electronic services. Overall, the banking industry is experiencing declines in mortgage banking revenues as mortgage refinance activity has slowed and First Mid has experienced a similar decline. It is positive that our first quarter results were higher than last year as we were able to offset the decrease in mortgage banking revenues with growth in other areas.

Net interest income for the first quarter of 2014 was $12.5 million compared to $12.2 million for the same period in 2013. As mentioned, loan balances increased over the past year with total loans at $992 million as of March 31, 2014 compared to $983 million at year-end 2013 and $903 million as of March 31, 2013. The growth in loans was a mixture of commercial operating, commercial real estate, and agricultural real estate across our market area. Deposit balances also increased since year-end but declined from last March as we continued to maintain our low funding costs. With changing the mix of balance sheet assets from investments to higher-yielding loans and continuing to hold deposit costs at low levels, we saw an improvement in the net interest margin in the second half of 2013 and into this year. The net interest margin on a tax equivalent basis was 3.50% for the first three months of 2014 compared to 3.40% for the same period in 2013.

I mentioned that our provision for loan losses declined to $323,000 for the first three months of 2014 compared to $480,000 last year. During the first quarter of 2014, we had net recoveries of previous charge-offs of $31,000. With our history of having lower charge-offs than peers, this is the first time in several years that recoveries exceeded charge-offs for a quarter. Also, our non-performing loans and other real estate owned declined to $6.1 million at March 31, 2014 compared to $7.0 million at December 31, 2013 and $9.4 million at March 31, 2013. The continued positive trend in these two metrics allowed us to reduce the provision for loan losses for the first quarter. We also continue to have a strong coverage ratio of the allowance for loan losses to the level of non-performing loans of 248%.

Non-interest income for the first quarter of $4.5 million was lower than the $4.6 million for the same period last year. As mentioned previously, mortgage banking revenue declined by $188,000 as refinances slowed with higher mortgage rates. We also had $162,000 more in security gains during the first quarter of last year. Fees from electronic services were $90,000 higher than last year and partially offset the decline. These fees were higher as customers continue to increase their use of electronic services. Revenues from trust and wealth management services were also $119,000 higher than the first quarter of last year as we had greater revenue from retirement services area and higher brokerage fees. Insurance commissions were $72,000 higher than last year with greater income from carriers based upon claims experience and increased new business.

Operating expenses for the first quarter were $11.0 million compared to $10.6 million for the first quarter of last year. Salaries and benefits expense included greater officer salary costs and higher retirement plan expense. Occupancy costs were also higher primarily due to higher building maintenance expenses from snow removal.

Our regulatory capital ratios remained strong and in excess of the regulatory minimums to be considered well-capitalized. Our Tier 1 Capital and Total Capital Ratios at March 31, 2014 were slightly below last March primarily due to an increase in risk-weighted assets (which is the denominator of these ratios) due to the growth in loan balances that have a higher capital requirement while the Leverage Ratio increased slightly.

Throughout the first quarter, we also made customer service improvements in our electronic distribution channels. To enhance customer accessibility and streamline product and service layout, we completed a redesign of our website, www.firstmid.com. The new website offers visitors a responsive design and therefore a more user-friendly experience when accessing the site by mobile device, tablet, or PC. I encourage you to take a look at the improvements. In addition, we also re-launched our Mobile Banking App, re-branded to First Mid-Illinois Bank and Trust, N.A. Customers can now easily find and download the App from Google Play or Apple providing easier mobile access for balance inquiries and regular banking transactions. I believe you will find these improvements will enhance and expand our service delivery and make for a better overall electronic banking experience. As always, your feedback is appreciated.

Thank you for your continued support of First Mid-Illinois Bancshares, Inc.

Sincerely,

Joseph R. Dively

Chairman and Chief Executive Officer

217-258-9520

jdively@firstmid.com

April 30, 2014

First Mid-Illinois Bancshares, Inc.

1421 Charleston Avenue

Mattoon, Illinois 61938

217-234-7454

www.firstmid.com

First Quarter 2014 Financial Results
FIRST MID-ILLINOIS BANCSHARES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)	(unaudited)						(unaudited)
	March 31,			December 31			March 31,
	2014			2013			2013
Assets
Cash and due from banks	$	72,588		$	65,102		$	72,628
Investment securities	447,851			488,724			535,120
Loans (including loans held for sale)	991,731			982,804			902,965
Less allowance for loan losses	(13,603		)	(13,249		)	(11,984		)
Net loans	978,128			969,555			890,981
Premises and equipment, net	28,062			28,578			29,268
Goodwill and intangibles, net	28,078			28,240			28,744
Other assets	28,365			25,299			20,972
Total assets	$	1,583,072		$	1,605,498		$	1,577,713
Liabilities and Stockholders’ Equity
Deposits:
Non-interest bearing	$	226,079		$	235,448		$	251,233
Interest bearing	1,079,746			1,052,168			1,058,936
Total deposits	1,305,825			1,287,616			1,310,169
Repurchase agreements with customers	81,277			119,187			76,372
Other borrowings	11,000			20,000			5,000
Junior subordinated debentures	20,620			20,620			20,620
Other liabilities	10,473			8,694			8,453
Total liabilities	1,429,195			1,456,117			1,420,614
Total stockholders’ equity	153,877			149,381			157,099
Total liabilities and stockholders’ equity	$	1,583,072		$	1,605,498		$	1,577,713

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS'EQUITY
(in thousands)(unaudited)
	Three months ended
	March 31,
	2014			2013
Balance at beginning of period	$	149,381		$	156,687
Net income	3,607			3,528
Dividends on preferred stock and common stock	(1,102		)	(1,104		)
Issuance of preferred and common stock	496			463
Purchase of treasury stock	(902		)	(1,158		)
Deferred compensation and other adjustments	(35		)	(6		)
Changes in accumulated other comprehensive income	2,432			(1,311		)
Balance at end of period	$	153,877		$	157,099

First Quarter 2014 Financial Results
FIRST MID-ILLINOIS BANCSHARES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)(unaudited)	Three months ended
	March 31,
	2014		2013
Interest income:
Interest and fees on loans	$	10,812	$	10,435
Interest on investment securities	2,523		2,741
Interest on federal funds sold & other deposits	27		26
Total interest income	13,362		13,202
Interest expense:
Interest on deposits	609		796
Interest on repurchase agreements with customers	12		15
Interest on other borrowings	68		57
Interest on subordinated debt	126		130
Total interest expense	815		998
Net interest income	12,547		12,204
Provision for loan losses	323		480
Net interest income after provision for loan losses	12,224		11,724
Non-interest income:
Trust revenues	933		893
Brokerage commissions	250		171
Insurance commissions	558		486
Service charges	1,144		1,140
Securities gains (losses), net	191		353
Mortgage banking revenues	98		286
ATM / debit card revenue	973		883
Other	334		338
Total non-interest income	4,481		4,550
Non-interest expense:
Salaries and employee benefits	6,053		5,797
Net occupancy and equipment expense	2,149		2,043
Amortization of intangible assets	162		170
Legal and professional expense	562		548
Other	2,034		2,054
Total non-interest expense	10,960		10,612
Income before income taxes	5,745		5,662
Income taxes	2,138		2,134
Net income	$	3,607	$	3,528
Per Share Information
Basic earnings per common share	$	0.43	$	0.41
Diluted earnings per common share	$	0.43	$	0.41
Dividends per common share	$	—	$	—

First Quarter 2014 Financial Results
FIRST MID-ILLINOIS BANCSHARES, INC.
SELECTED FINANCIAL HIGHLIGHTS	As Of
	(unaudited)						(unaudited)
	March 31,			December 31,			March 31,
	2014			2013			2013
SHARE AND PER COMMON SHARE DATA
Book value per common share	$17.36			$16.54			$17.71
Tangible book value per common share	$12.58			$11.75			$12.87
Common shares outstanding	5,865,438			5,883,780			5,932,295
Market price of stock	$21.05			$22.00			$23.95
REGULATORY CAPITAL RATIOS
Leverage ratio	10.17		%	10.12		%	9.78		%
Total capital to risk-weighted assets	15.46		%	15.58		%	16.06		%
Tier 1 capital to risk-weighted assets	14.24		%	14.37		%	14.89		%
Common equity tier 1 capital to risk weighted assets	7.83		%	7.78		%	7.84		%
Preferred stockholders' equity	$	52,030,000		$	52,035,000		$	52,035,000
Common stockholders' equity	$	101,847,000		$	97,346,000		$	105,064,000
ASSET QUALITY
Allowance for loan losses to non-performing loans	248.0		%	204.8		%	145.1		%
Allowance for loan losses to total loans outstanding	1.37		%	1.35		%	1.33		%
Total net charge-offs (1)	$(31,000)			$214,000			$272,000
Total non-performing loans and other real estate owned	$6,067,000			$7,037,000			$9,439,000

	Three months ended
	(unaudited)				(unaudited)
	March 31,		December 31,		March 31,
	2014		2013		2013
PERFORMANCE RATIOS (1)
Return on average assets (2)	0.91	%	0.92	%	0.89	%
Return on average common equity (2)	9.96	%	10.10	%	9.21	%
Net interest margin (3)	3.50	%	3.52	%	3.40	%

(1) Financial information is provided as of the date listed except Performance Ratios and Total Net charge-offs which are as of the three-month period ending on the date listed

(2) Annualized net income for period

(3) On a tax equivalent basis (TE), assuming a federal income tax rate of 35%

EX-99.2

Exhibit 99.2

FOR IMMEDIATE RELEASE
April 30, 2014
Media Contact:  Mandy Lewis	Investor Contact: Lee Ann Perry
VP, Director of Marketing	VP, Shareholder Services
217-258-0675	217-258-0493
mlewis@firstmid.com	lperry@firstmid.com

FIRST MID-ILLINOIS BANCSHARES, INC.

COMMON STOCK TO BEGIN TRADING ON NASDAQ UNDER FMBH

MATTOON, IL, - First Mid-Illinois Bancshares, Inc., officially announced at its Annual Shareholder meeting on April 30 that its common stock was approved by The NASDAQ Stock Market LLC for listing on the NASDAQ Global Market. First Mid-Illinois Bancshares, Inc. is the parent company of First Mid-Illinois Bank and Trust, which offers full service banking and financial services through 37 locations in 25 communities across Illinois. Trading on NASDAQ is expected to begin on May 12, 2014 under the ticker symbol “FMBH”.

Joe Dively, Chairman and CEO of First Mid-Illinois, stated, “Listing on the NASDAQ is a significant step in our ongoing efforts to enhance shareholder value. This action should increase the Company’s visibility in the marketplace by providing a larger trading platform for potential investors and the capacity for greater liquidity and efficiency in our stock trading. As we look to celebrate our 150th anniversary early next year, this milestone should further enhance the long-term value of the Company and support growth initiatives whether that is through acquisition or organic growth.”

About First Mid-Illinois Bancshares, Inc.:

First Mid-Illinois Bancshares, Inc. is the parent company of First Mid-Illinois Bank & Trust, N.A. (First Mid) and First Mid Insurance Group. A community bank with over $1.6 billion in assets headquartered in Mattoon, IL, First Mid offers comprehensive banking, trust and wealth management services, and insurance through 37 banking centers located in 25 Illinois communities. Established in 1865, First Mid’s vision is to be the best financial institution in the region, where service is provided at a level above expectation, and to be recognized as such by customers, employees and the communities it serves. More information about First Mid is available at www.firstmid.com.

Forward-Looking Statements:

This news release contains forward-looking statements about First Mid-Illinois Bancshares, Inc., for which the Company intends claims protection of the safe harbor provisions 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 the Company, 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 those described in Item 1A - “Risk Factors” and other sections of the Company’s Annual Report on Form 10-K and the Company’s other filings with the SEC. Furthermore, 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.

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