10-Q

SECURITIES AND EXCHANGE COMMISSION
FORM 10-Q
Washington, D.C. 20549


(Mark One)

[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarter ended March 31, 2002 or

[  ]    Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from__________________to ____________________.

Commission File Number 0-10967
____________________________________________________________________________________________

FIRST MIDWEST BANCORP, INC. (Exact name of Registrant as specified in its charter)
Delaware (State or other jurisdiction of incorporation or organization)	36-3161078 (IRS Employer Identification No.)
300 Park Blvd., Suite 405, P.O. Box 459 Itasca, Illinois 60143-9768 (Address of principal executive offices) (zip code) (630) 875-7450 (Registrant's telephone number, including area code) Common Stock, $.01 Par Value Preferred Share Purchase Rights Securities Registered Pursuant to Section 12(g) of the Act
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [  ].
As of May 13, 2002, 48,464,083 shares of the Registrant's $.01 par value common stock were outstanding, excluding treasury shares.
Exhibit Index is located on page 23*.

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FIRST MIDWEST BANCORP, INC.

FORM 10-Q

TABLE OF CONTENTS

Page
Part I. FINANCIAL INFORMATON
Item 1. Financial Statements
Consolidated Statements of Condition	3*
Consolidated Statements of Income	4*
Consolidated Statements of Cash Flows	5*
Notes to Consolidated Financial Statements	6*
Item 2. Management's Discussion and Analysis of Financial Condition                 and Results of Operations	11*
Part II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K	22*

2

PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS FIRST MIDWEST BANCORP, INC. CONSOLIDATED STATEMENTS OF CONDITION (Amounts in thousands)
				March 31, 2002		December 31, 2001
				(Unaudited)
Assets
	Cash and due from banks			$	182,559	$		155,822
	Federal funds sold and other short-term investments				9,344	4,334
	Mortgages held for sale				10,306	15,240
	Securities available for sale, at market value				1,907,294	1,771,607
	Securities held to maturity, at amortized cost				96,956	89,227
	Loans, net of unearned discount				3,373,742	3,372,306
	Reserve for loan losses				(47,774)	(47,745)
			Net loans		3,325,968	3,324,561
	Premises, furniture and equipment				81,625	77,172
	Accrued interest receivable				33,535	32,027
	Investment in corporate owned life insurance				136,819	135,280
	Goodwill				16,397	16,397
	Other intangible assets				1,138	1,313
	Other assets				40,848	44,939
			Total assets	$	5,842,789	$	5,667,919
Liabilities
	Demand deposits			$	733,217	$		738,175
	Savings deposits				449,351	421,079
	NOW accounts				679,397	662,530
	Money market deposits				569,231	584,030
	Time deposits				1,738,982	1,788,107
			Total deposits		4,170,178	4,193,921
	Borrowed funds				1,174,370	971,851
	Accrued interest payable				8,806	10,231
	Other liabilities				42,612	44,649
			Total liabilities		5,395,966	5,220,652
Stockholders' equity
	Preferred stock, no par value; 1,000 shares authorized, none issued				-	-
	Common stock, $.01 par value; authorized 60,000 shares; issued 56,927 shares    outstanding: March 31, 2002-48,534 shares; December 31, 2001-48,725 shares				569	569
	Additional paid-in capital				72,500	74,961
	Retained earnings				551,400	537,600
	Accumulated other comprehensive (loss) income, net of tax				(1,129)	5,265
	Treasury stock, at cost: March 31, 2002 - 8,393 shares    December 31, 2001 - 8,202 shares				(176,517)	(171,128)
		Total stockholders' equity			446,823	447,267
		Total liabilities and stockholders' equity		$	5,842,789	$	5,667,919
See notes to consolidated financial statements.

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FIRST MIDWEST BANCORP, INC. CONSOLIDATED STATEMENTS OF INCOME (Amounts in thousands) (Unaudited)
		Quarters Ended March 31,
		2002		2001
Interest Income
Loans		$	56,937	$	69,212
Securities available for sale		25,665		31,829
Securities held to maturity		1,179		1,407
Federal funds sold and other short-term investments		162		193
	Total interest income	83,943		102,641
Interest Expense
Deposits		22,616		40,117
Borrowed funds		7,080		15,636
	Total interest expense	29,696		55,753
	Net interest income	54,247		46,888
Provision for loan losses		5,055		3,458
	Net interest income after provision for loan losses	49,192		43,430
Noninterest Income
Service charges on deposit accounts		5,756		5,492
Trust and investment management fees		2,708		2,673
Other service charges, commissions, and fees		4,293		4,267
Corporate owned life insurance income		1,698		2,268
Security gains, net		-		704
Other income		1,687		1,522
	Total noninterest income	16,142		16,926
Noninterest Expense
Salaries and wages		15,126		14,361
Retirement and other employee benefits		4,433		4,077
Occupancy expense of premises		3,515		4,114
Equipment expense		1,882		1,954
Technology and related costs		2,466		2,541
Professional services		1,726		1,357
Advertising and promotions		969		891
Other expenses		5,519		5,798
	Total noninterest expense	35,636		35,093
Income before income tax expense		29,698		25,263
Income tax expense		7,627		5,939
	Net income	$	22,071	$	19,324
Per Share Data
	Basic earnings per share	$	0.45	$	0.38
	Diluted earnings per share	$	0.45	$	0.38
	Cash dividends per share	$	0.17	$	0.16
	Weighted average shares outstanding	48,647		51,081
	Weighted average diluted shares outstanding	49,047		51,356
See notes to consolidated financial statements.

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FIRST MIDWEST BANCORP, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Amounts in thousands) (Unaudited)
					Quarters Ended March 31,
					2002		2001
Operating Activities
Net income				$		22,071	$		19,324
Adjustments to reconcile net income to net cash provided by operating activities:
	Provision for loan losses			5,055			3,458
	Depreciation of premises, furniture, and equipment			2,100			2,168
	Net amortization (accretion) of premium (discount) on securities			1,992			(28)
	Net (gains) on sales of securities			-			(704)
	Net (gains) on sales of other real estate owned			(43)			(54)
	Net losses on sales of premises, furniture, and equipment			153			29
	Tax benefits from employee exercises of nonqualified stock options			605			252
	Net decrease (increase) in deferred income taxes			1,060			(321)
	Net amortization of goodwill and other intangibles			175			748
	Originations and purchases of mortgage loans held for sale			(59,369)			(35,934)
	Proceeds from sales of mortgage loans held for sale			64,303			31,725
	Net (increase) in corporate owned life insurance			(1,539)			(2,998)
	Net (increase) decrease in accrued interest receivable			(1,508)			3,089
	Net (decrease) in accrued interest payable			(1,425)			(3,310)
	Net decrease (increase) in other assets			8,045			(1,062)
	Net (decrease) increase in other liabilities			(1,982)			2,439
		Net cash provided by operating activities		39,693			18,821
Investing Activities
Securities available for sale:
	Proceeds from maturities, repayments, and calls			147,665			236,241
	Proceeds from sales			-			354,581
	Purchases			(296,703)			(376,934)
Securities held to maturity:
	Proceeds from maturities, repayments, and calls			1,386			5,825
	Purchases			(9,115)			(16,921)
Net (increase) in loans				(8,341)			(49,676)
Proceeds from sales of other real estate owned				1,263			414
Proceeds from sales of premises, furniture, and equipment				1,297			1
Purchases of premises, furniture, and equipment				(8,003)			(1,506)
		Net cash (used) provided by investing activities		(170,551)			152,025
Financing Activities
Net (decrease) in deposit accounts				(23,743)			(106,592)
Net increase (decrease) in borrowed funds				202,519			(46,844)
Purchase of treasury stock				(12,157)			(5,118)
Proceeds from issuance of treasury stock				7			4
Cash dividends paid				(8,303)			(8,185)
Exercise of stock options				4,282			821
			Net cash provided (used) by financing activities	162,605			(165,914)
			Net increase in cash and cash equivalents	31,747			4,932
			Cash and cash equivalents at beginning of period	160,156			184,493
			Cash and cash equivalents at end of period	$		191,903	$	189,425
See notes to consolidated financial statements.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands, except per share data)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accompanying unaudited interim consolidated financial statements of First Midwest Bancorp, Inc. ("First Midwest" or the "Company") have been prepared in accordance with generally accepted accounting principles and with the rules and regulations of the Securities and Exchange Commission for interim financial reporting. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of Management, all normal and recurring adjustments that are necessary to fairly present the results for the interim periods presented have been included. The preparation of financial statements requires Management to make estimates and assumptions that affect the recorded amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates. In addition, certain reclassifications have been made to the 2001 data to conform to the 2002 presentation. For further information with respect to significant accounting policies followed by First Midwest in the preparation of its consolidated financial statements, refer to First Midwest's Annual Report on Form 10-K for the year ended December 31, 2001.

Reserve for Loan Losses

The reserve for loan losses is maintained at a level believed adequate by Management to absorb probable losses inherent in the loan portfolio and is based on the size and current risk characteristics of the loan portfolio; an assessment of individual problem loans; actual and anticipated loss experience; and current economic events in specific industries and geographical areas including unemployment levels, regulatory guidance, general economic conditions, and other pertinent factors. Determination of the reserve is inherently subjective as it requires significant estimates, including the amounts and timing of expected future cash flows on impaired loans, estimated losses on pools of homogeneous loans based on historical loss experience, and consideration of current economic trends, all of which may be susceptible to significant change. Loan losses are charged off against the reserve, while recoveries of amounts previously charged off are credited to the reserve. A provision for loan loss es is charged to operating expense based on Management's periodic evaluation of the factors previously mentioned, as well as other pertinent factors.

Based on an estimation done pursuant to either Financial Accounting Standards Board ("FASB") Statement No. 5, "Accounting for Contingencies," or FASB Statement Nos. 114 and 118, "Accounting by Creditors for Impairment of a Loan," the reserve for loan losses consists of three elements: (i) specific reserves established for expected losses resulting from analysis developed through specific credit allocations on individual loans for which the recorded investment in the loan exceeds its fair value; (ii) general allocated reserves based on historical loan loss experience for each loan category; and (iii) unallocated reserves based on general economic conditions as well as specific economic factors in the markets in which the Company operates.

The specific reserve allocations are based on a regular analysis of impaired loans over a fixed-dollar amount where the internal credit rating is at or below a predetermined classification. A loan is considered impaired when it is probable that First Midwest will be unable to collect all contractual principal and interest due according to the terms of the loan agreement. Loans subject to impairment valuation are defined as nonaccrual and restructured loans exclusive of smaller homogeneous loans such as home equity, installment, and 1-4 family residential loans. The fair value of the loan is determined based on the present value of expected future cash flows discounted at the loan's effective interest rate, the market price of the loan, or the fair value of the underlying collateral less costs to sell, if the loan is collateral dependent.

The general allocated portion of the reserve based on historical loan loss experience is determined statistically using a loss migration analysis that examines loss experience and the related internal gradings of loans charged-off. The loss migration analysis is performed quarterly and loss factors are updated regularly based on actual experience. The general allocated element of the reserve for loan losses also includes consideration of the amounts necessary for concentrations and changes in portfolio mix and volume.

The unallocated portion of the reserve reflects Management's estimate of probable inherent but undetected losses within the portfolio due to uncertainties in economic conditions, delays in obtaining information, including unfavorable information about a borrower's financial condition, the difficulty in identifying triggering events that correlate perfectly to subsequent loss rates, and risk factors that have not yet manifested themselves in loss allocation factors. In addition, the unallocated reserve includes a component that explicitly accounts for the inherent imprecision in loan loss migration models. Also, loss data representing a complete economic cycle is not available for all sectors. The uncertainty following the events of September 11^th and the recessionary environment also impact the allocation model's estimate of loss. The historical losses used in the migration analysis may not be representative of actual losses inherent in the portfolio that have not yet been r ealized.

6

Goodwill And Other Intangible Assets

Effective January 1, 2002, First Midwest adopted FASB No. 142, "Goodwill and Other Intangible Assets", which addresses the accounting and reporting for acquired goodwill and other intangible assets and supersedes APB Opinion 17. Under FASB No. 142, goodwill and intangible assets deemed to have indefinite lives will no longer be amortized but reviewed for impairment annually, or more frequently if certain indicators arise. First Midwest is required to complete the initial step of transitional impairment test within six months of adoption of FASB No. 142 and to complete the final step of the transitional impairment test by the end of the fiscal year. Any impairment loss resulting from the transitional impairment test will be recorded as a cumulative effect of a change in accounting principal with any subsequent impairment losses reflected in operating income in the income statement. In addition, the Statement requires the reassessment of identifiable intangibles with identifiabl e lives and continue to be amortized.

First Midwest has completed the transitional impairment test required upon adoption of FASB No. 142 and determined that there is no impairment to its recorded goodwill balances. For additional disclosures regarding goodwill and other intangible assets, see Note 5 on page * of this Form 10-Q.

Accounting For Long-Lived Assets

Effective January 1, 2002, First Midwest adopted FASB Statement No. 144, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed of," ("FASB No. 144") which addresses how and when to measure impairment on long-lived assets and how to account for long-lived assets that an entity plans to dispose of either through sale, abandonment, exchange, or distribution to owners. The new provisions supersede FASB No. 121, which addressed asset impairment, and certain provisions of APB Opinion 30 related to reporting the effects of the disposal of a business segment and requires expected future operating losses from discontinued operations to be recorded in the period in which the losses are incurred rather than the measurement date. Under FASB No. 144, more dispositions may qualify for discontinued operations treatment in the income statement. The adoption of FASB No. 144 had no material impact on the Company's financial position or results of operations in the first quarter 2002.

2. SECURITIES

The aggregate amortized cost, gross unrealized gains and losses, and market value of securities were as follows:

		March 31, 2002								December 31, 2001
		Amortized		Gross Unrealized				Market		Amortized		Gross Unrealized				Market
		Cost		Gains		Losses		Value		Cost		Gains		Losses		Value
Securities Available    for Sale
U.S. Treasury		$	200	$	3	$	-	$	203	$	200	$	5	$	-	$	205
U.S. Agency		148,702		164		(569)		148,297		70,217		208		(30)		70,395
Mortgage-backed		1,221,006		8,879		(5,945)		1,223,940		1,152,535		12,091		(2,887)		1,161,739
State and municipal		473,506		9,510		(4,399)		478,617		473,873		9,347		(4,046)		479,174
Other		63,624		57		(7,444)		56,237		63,167		51		(3,124)		60,094
	Total	$	1,907,038	$	18,613	$	(18,357)	$	1,907,294	$	1,759,992	$	21,702	$	(10,087)	$	1,771,607
Securities Held    to Maturity
U.S. Treasury		$	2,005	$	-	$	-	$	2,005	$	2,006	$	40	$	-	$	2,046
U.S. Agency		126		-		-		126		126		-		-		126
State and municipal		70,567		132		-		70,699		63,452		127		(4)		63,575
Other		24,258		-		-		24,258		23,643		-		-		23,643
	Total	$	96,956	$	132	$	-	$	97,088	$	89,227	$	167	$	(4)	$	89,390

For additional details of the securities available for sale portfolio and the related impact of unrealized gains/(losses) thereon, see Note 7 to the interim consolidated financial statements on page 10*.

7

3. LOANS

Total loans, net of deferred loan fees and other discounts of $1.9 million and $2.3 million at March 31, 2002 and December 31, 2001, respectively were as follows:

		March 31,		December 31,
		2002		2001
Commercial and industrial		$	854,039	$	827,281
Agricultural		82,029		87,188
Consumer		937,953		947,246
Real estate - 1 - 4 family		179,672		196,741
Real estate - commercial		996,295		998,857
Real estate - construction		323,754		314,993
	Total loans, net of unearned discount	$	3,373,742	$	3,372,306

First Midwest concentrates its lending activity in the geographic market areas that it serves, generally lending to consumers and small to mid-sized businesses from whom deposits are garnered in the same market areas. As a result, First Midwest strives to maintain a loan portfolio that is diverse in terms of loan type, industry, borrower and geographic concentrations. Such diversification reduces the exposure to economic downturns that may occur in different segments of the economy or in different industries. As of March 31, 2002 and December 31, 2001, there were no significant loan concentrations with any single borrower, industry or geographic segment.

4. RESERVE FOR LOAN LOSSES/IMPAIRED LOANS

A summary of the transactions in the reserve for loan losses and details regarding impaired loans for the quarters ended March 31, 2002 and 2001 are summarized below:

			Quarters Ended March 31,
			2002		2001
Balance at beginning of period			$	47,745	$	45,093
	Loans charged-off		(5,865)		(3,704)
	Recoveries of loans previously charged-off		839		574
		Net loans (charged-off)	(5,026)		(3,130)
	Provision for loan losses		5,055		3,458
Balance at end of period			$	47,774	$	45,421
Impaired Loans:
	Requiring valuation reserve (1)		$	4,253	$	7,934
	Not requiring valuation reserve		8,015		8,071
		Total impaired loans	$	12,268	$	16,005
Valuation reserve related to impaired loans			$	3,090	$	1,417
Average impaired loans			$	13,698	$	14,493
Interest income recognized on impaired loans			$	7	$	36
(1)		These impaired loans require a valuation reserve allocation because the value of the loans is less than the recorded investments in the loans.

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5. GOODWILL AND OTHER INTANGIBLE ASSETS

Effective January 1, 2002, First Midwest adopted Financial Accounting Standards Board ("FASB") No. 142, "Goodwill and Other Intangible Assets." In accordance with the Statement, First Midwest discontinued the amortization of goodwill which is not deductible for income tax purposes. A reconciliation of previously reported net income and earnings per share as adjusted for the exclusion of goodwill amortization is presented below had First Midwest accounted for goodwill under FASB No. 142 for all periods presented:

		Quarters Ended March 31,
		2002		2001
Reported net income		$	22,071	$	19,324
Add back of goodwill amortization		-		540
Adjusted net income		$	22,071	$	19,864
Basic earning per share:
	Reported net income	$	0.45	$	0.38
	Goodwill amortization	-		0.01
	Adjusted net income	$	0.45	$	0.39
Diluted earnings per share:
	Reported net income	$	0.45	$	0.38
	Goodwill amortization		-		0.01
	Adjusted net income	$	0.45	$	0.39

First Midwest's carrying value of goodwill was $16.4 million at March 31, 2002 and December 31, 2001. Information regarding the Company's other intangible assets follows:

		March 31, 2002						December 31, 2001
		Carrying Amount		Accumulated Amortization		Net		Carrying Amount		Accumulated Amortization			Net
Other intangible assets:
	Core deposit premium	$	5,359	$	4,390	$	969	$	6,892	$	5,766	$		1,126
	Other identified intangibles		423	254		169			423	236		187
	Total	$	5,782	$	4,644	$	1,138	$	7,315	$	6,002	$		1,313

Amortization expense of other intangible assets, which is deductible for income tax purposes, was $175 and $208 for the three months ended March 31, 2002 and 2001, respectively.

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6. EARNINGS PER COMMON SHARE

The following table sets forth the computation of basic and diluted earnings per share for the quarters ended March 31, 2002 and 2001:

		Quarters Ended March 31,
		2002		2001
Basic Earnings Per Share:
	Net income	$	22,071	$	19,324
	Average common shares outstanding	48,647		51,081
	Basic earnings per share	$	0.45	$	0.38
Diluted Earnings Per Share:
	Net income	$	22,071	$	19,324
	Average common shares outstanding	48,647		51,081
	Dilutive effect of stock options	400		275
	Diluted average common shares outstanding	49,047		51,356
	Diluted earnings per share	$	0.45	$	0.38

7. COMPREHENSIVE INCOME

The components of comprehensive income, net of related taxes, for the quarters ended March 31, 2002 and 2001 are as follows:

		Quarters Ended March 31,
		2002		2001
Net Income		$	22,071	$	19,324
Unrealized holding (losses) gains on securities available    for sale, net of reclassification adjustment		(6,929)		12,377
Unrealized holding gains (losses) on hedging activity		535		(517)
	Comprehensive Income	$	15,677	$	31,184
Disclosure of Reclassification Amount:
Unrealized holding (losses) gains on securities    available for sale arising during the period		$	(6,929)	$		12,806
Less: Reclassification adjustment for net    gains realized during the period		-		429
Net unrealized holding (losses) gains on    securities available for sale				$		12,377
		$	(6,929)

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Provided below is the change in accumulated other comprehensive (loss) income for the quarters ended March 31, 2002 and 2001:

			Quarters Ended March 31,
			2002		2001
Beginning balance			$	5,265	$	(7,039)
Current year change			(6,394)		11,860
Ending balance			$	(1,129)	$	4,821
Ending balance consists of:
	Accumulated unrealized gains on securities available for sale		$	156	$	5,338
	Accumulated unrealized (losses) on hedging activities			(1,285)		(517)
		Total accumulated other comprehensive (loss) income	$	(1,129)	$	4,821

For additional details of the securities available for sale portfolio and the related impact of unrealized gains/(losses) thereon, see Note 2 to the interim consolidated financial statements on page 7*.

8. SUPPLEMENTARY CASH FLOW INFORMATION

Supplemental disclosures to the Consolidated Statements of Cash Flows for the quarters ended March 31, 2002 and 2001 are as follows:

	Quarters Ended March 31,
	2002		2001
Income taxes paid	$	8	$	38
Interest paid to depositors and creditors	31,121		59,063
Non cash transfers of loans to foreclosed real estate	1,879		269
Dividends declared but unpaid	8,271		8,153

9. CONTINGENT LIABILITIES AND OTHER MATTERS

There are certain legal proceedings pending against First Midwest and its Subsidiaries in the ordinary course of business at March 31, 2002. In assessing these proceedings, including the advice of counsel, First Midwest believes that liabilities arising from these proceedings, if any, would not have a material adverse effect on the consolidated financial condition of First Midwest.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

The discussion presented below provides an analysis of First Midwest's results of operations and financial condition for the quarters ended March 31, 2002 and 2001. Management's discussion and analysis should be read in conjunction with the Consolidated Financial Statements and accompanying notes presented elsewhere in this report as well as First Midwest's 2001 Annual Report on Form 10-K. Results of operations for the quarter ended March 31, 2002 are not necessarily indicative of results to be expected for the full year of 2002. Unless otherwise stated, all earnings per share data included in this section and throughout the remainder of this discussion are presented on a diluted basis. All financial information is presented in thousands, except per share data.

Summary of Performance

Net income for the quarter ended March 31, 2002 increased to a record $22,071, or $.45 per diluted share, as compared to the 2001 first quarter of $19,324, or $.38 per diluted share, representing an increase of 18.4% on a diluted share basis. Performance for the 2002 quarter resulted in record annualized return on average assets of 1.55% as compared to 1.36% for the same quarter of 2001 and annualized return on average equity of 19.4% as compared to 17.1% for the 2001 quarter. The elimination of goodwill amortization expense resulting from the implementation of FASB No. 142 (effective January 1, 2002) added $540 (after tax) and $.01 per share to first quarter 2002 net income and diluted earnings per share, respectively.

11

Cash basis diluted earnings (which excludes amortization of goodwill and core deposit intangibles resulting from acquisitions) increased to $.45 per share for first quarter 2002 as compared to 2001's $.39 per share, representing an increase of 15.4%. On a cash basis, the annualized return on average assets (which excludes from average assets goodwill and core deposit intangibles) was 1.57% for first quarter 2002 as compared to 2001's 1.41%, while annualized return on average equity for first quarter 2002 was 19.5% as compared to 2001's 17.7%.

Net interest margin for first quarter 2002 was 4.32%, a 55 basis point improvement over the 3.77% for 2001's like quarter. With the yield curve remaining steep through first quarter 2002, net interest margin was stable and essentially unchanged from the 4.33% earned in fourth quarter 2001.

Excluding net security gains realized in first quarter 2001, noninterest income totaled $16,142 and was essentially flat in first quarter 2002 as compared to the same quarter in 2001. Factoring out the elimination of goodwill amortization expense referred to previously total noninterest expenses for first quarter 2002 were 3.2% above the prior year's like quarter but decreased 1.3% on a linked-quarter basis. The efficiency ratio for the first quarter 2002 continued to improve to a record 47.3% as compared to 51.4% for 2001's like quarter.

The provision for loan losses for first quarter 2002 totaled $5,055, exceeding net charge-offs by $29. Net loan charge-offs for the first quarter 2002 were .61% of average loans, up from .39% for first quarter 2001 and .49% for full year 2001.

Net Interest Income, Earning Assets, and Funding Sources

Net Interest Income/Margin

The accounting policies underlying the recognition of interest income on loans, securities and other earnings assets are included in the "Notes to Consolidated Financial Statements" contained in First Midwest's 2001 Annual Report on Form 10-K.

Net interest income on a tax equivalent basis totaled $57,760 for first quarter 2002, representing an increase of $7,244, or 14.3%, over the 2001 period of $50,516, with net interest margin for the 2002 quarter improving by 55 basis points to 4.32% as compared to 3.77% for the 2001 quarter. The year-over-year increase in margin was principally driven by the interest rate reductions initiated by the Federal Reserve beginning in the first quarter 2001 and continuing over the course of the year with short-term interest rates dropping an average of 320 basis points over this time frame while longer term interest rates remained relatively flat. As such, this market dynamic positively benefited the Company's liability-sensitive Consolidated Statements of Condition resulting in interest-bearing liabilities repricing more quickly in response to the changing market interest rates than interest-earning assets. As shown in the Volume/Rate Analysis on page *, the increase in net interest income is attributable to the reduction in interest expense paid on interest-bearing liabilities totaling $26,057 for first quarter 2002 exceeding the reduction in interest income earned on interest-earning assets totaling $18,813 for such quarter.

The decrease in interest expense was predominately attributable to a 224 basis point drop in the interest rates paid on these liabilities as a result of the favorable interest rate environment previously discussed, as well as certain measures taken to shift interest-bearing liabilities terms and repricing characteristics more favorably with the current falling interest rate environment. These measures included shortening the maturity of certain interest-bearing liabilities, sales and customer promotional incentives, and a strategic change in the maturity structure of borrowed funds. These measures are more fully described in the subsequent discussion on core funding sources found on Page 14.

The reduction in interest income was driven by a 139 basis point decline in the interest rates earned on assets. Average earning assets for the first quarter of 2002 were essentially stable at $5,343,050 as compared to the year-ago like period. The most significant components of earning assets, loans and securities, are generally less sensitive to movement in market interest rates as the underlying cash flows do not reprice as quickly. Consequently, this characteristic in combination with the planned use of cash flows from the securities portfolio to fund higher yielding loans helped reduce the effect of the decline in short term market rates on interest income.

Anticipating that the next move in interest rates is likely to be upward, the Company undertook certain steps during the second half of 2001 and first quarter 2002 intended to insulate net interest income against rising rates. These steps included a reduction in the liability sensitivity of the balance sheet through the lengthening of liabilities (primarily time deposits and Federal Home Loan Bank ("FHLB") advances) and the reinvestment of cash flows from mortgage-backed securities into short maturity securities. Although these strategies have slowed the upward momentum in net interest margin achieved over the last 5 quarters, the Company believes they will stabilize future performance in this key component of the income statement.

12

A description and analysis of First Midwest's rate sensitivity position and management policies is included in the "Notes to Consolidated Financial Statements" contained in First Midwest's 2001 Annual Report on Form 10-K.

Securities Portfolio

The following tables set forth the average and period end carrying values of the securities portfolios and changes therein as of the following periods:

			Average Balances
			2002		2001				March 31 % Change From
			March 31		December 31		March 31		12/31/01	3/31/01
By type:
	U.S. Treasury		$	2,205	$	2,289	$	2,396	(3.7)	(8.0)
	U.S. Agency		114,686		75,754		255,643		51.4	(55.1)
	Mortgage-backed		1,225,781		1,166,189		1,198,413		5.1	2.3
	State and municipal		539,994		537,907		542,472		0.4	(0.5)
	Other		87,677		84,858		86,917		3.3	0.9
		Total	$	1,970,343	$	1,866,997	$	2,085,841	5.5	(5.5)
By classification:
	Available for sale		$	1,877,896	$	1,780,862	$	2,000,944	5.4	(6.1)
	Held to maturity			92,447		86,135		84,897	7.3	8.9
		Total	$	1,970,343	$	1,866,997	$	2,085,8411	5.5	(5.5)

			As of Period End
			2002		2001				March 31 % Change From
			March 31		December 31		March 31		12/31/01	3/31/01
By type:
	U.S. Treasury		$	2,208	$	2,211	$	2,231	(0.1)	(0.1)
	U.S. Agency		148,423		70,521		167,927		110.5	(11.6)
	Mortgage-backed		1,223,940		1,161,739		1,219,315		5.4	0.4
	State and municipal		549,184		542,626		557,192		1.2	(1.4)
	Other		80,495		83,737		86,511		(3.9)	(7.0)
		Total	$	2,004,250	$	1,860,834	$	2,033,176	7.7	(1.4)
By classification:
	Available for sale		$	1,907,294	$	1,771,607	$	1,937,236	7.7	(1.5)
	Held to maturity			96,956		89,227		95,940	8.7	1.1
		Total	$	2,004,250	$	1,860,834	$	2,033,176	7.7	(1.4)

For the period ending March 31, 2002, the total average carrying value of the securities portfolio totaled $1,970,343, decreasing 5.5% from the year-ago like period of $2,085,841 and up 5.5% on a linked quarter basis. The year over year reduction is primarily due to a reduction in the U.S. Agency portfolio as a result of liquidity needs to fund loan growth. This reduction was essentially reversed by the end of the first quarter 2002 through a $100 million floating rate securities purchase in U.S. Agencies and $100 million mortgage-backed securities purchase both funded with wholesale funds and offset by cash flows utilized to fund loan growth.

13

Loan Growth

The following tables summarize growth in loans based upon both average and period end balances:

			Average Balances
			2002		2001				March 31 % Change From
			March 31		December 31		March 31		12/31/01	3/31/01
Commercial and industrial			$	826,739	$	831,832	$	819,145	(0.6)	0.9
Agricultural			81,543		90,942		67,261		(10.3)	21.2
Consumer			942,014		963,467		926,694		(2.2)	1.7
Real estate - 1 - 4 family			188,304		208,989		247,407		(9.9)	(23.9)
Real estate - commercial			1,000,716		992,885		910,012		0.8	10.0
Real estate - construction			321,061		322,118		287,483		(0.3)	11.7
	Total net loans		$	3,360,377	$	3,410,233	$	3,258,002	(1.5)	3.1
	Total net loans excluding
		real estate - 1-4 family	$	3,172,073	$	3,201,244	$	3,010,595	(0.9)	5.4

			As of Period End
			2002		2001				March 31 % Change From
			March 31		December 31		March 31		12/31/01	3/31/01
Commercial and industrial			$	854,039	$	827,281	$	827,463	3.2	3.2
Agricultural			82,029		87,188		67,792		(5.9)	21.0
Consumer			937,953		947,246		929,659		(1.0)	0.9
Real estate - 1 - 4 family			179,672		196,741		241,250		(8.7)	(25.5)
Real estate - commercial			996,295		998,857		951,072		(0.3)	4.8
Real estate - construction			323,754		314,993		262,237		2.8	23.5
	Total net loans		$	3,373,742	$	3,372,306	$	3,279,473	0.0	2.9
	Total net loans excluding
		real estate - 1-4 family	$	3,194,070	$	3,175,565	$	3,038,223	0.6	5.1

Total average loans for first quarter 2002 were 3.1% higher than the same period in 2001 with all loan categories except 1-4 family real estate experiencing growth. Excluding real estate 1-4 family loans, total average loan growth was 5.4% as compared to the year-ago like period. On a linked-quarter basis, however, loan growth was essentially flat. In furtherance of its asset liability management strategies, First Midwest initiated a planned reduction it its real estate 1-4 family loan portfolio, retaining originated floating rate and other certain qualifying mortgages while selling all other originations.

14

Core Funding Sources

The following table provides a comparison of average core funding sources for the quarters ended March 31, 2002 and 2001 based upon average balances. Average, rather than period-end balances are more meaningful in analyzing funding sources because of the inherent fluctuations that occur on a monthly basis within most deposit categories.

		Average Balances
		2002		2001				March 31 % Change From
		March 31		December 31		March 31		12/31/01	3/31/01
Demand deposits		$	712,057	$	719,121	$	656,312	(1.0)	8.5
Savings deposits		433,456		418,074		450,701		3.7	(3.8)
NOW accounts		685,583		583,719		438,707		17.5	56.3
Money market deposits		570,216		603,887		531,628		(5.6)	7.3
Time deposits		1,736,593		1,865,489		2,054,015		(6.9)	(15.5)
	Total deposits		4,137,905		4,190,290		4,131,363	(1.3)	0.2
Securities sold under agreements to
	repurchase		528,950		510,396		708,947	3.6	(25.4)
Federal funds purchased			258,974		254,291		198,729	1.8	30.3
Federal Home Loan Bank advances			326,389		267,554		203,222	22.0	60.6
	Total borrowed funds		1,114,313		1,032,241		1,110,898	8.0	0.3
	Total funding sources	$	5,252,218	$	5,222,531	$	5,242,261	0.6	0.2

Total deposits for first quarter 2002 were basically unchanged from the 2001 first quarter and decreased modestly on a linked-quarter basis, both in terms of period-end and average balances. Additionally, First Midwest experienced a movement in the composition of its deposit base from longer term time deposits to short term non-indexed NOW accounts as a part of its measures to reduce its liability sensitivity.

Wholesale funding increased during first quarter 2002 as a result of a $200 million securities purchase funded with a combination of repurchase agreements and Federal Home Loan Bank ("FHLB") advances. This transaction was initiated to take advantage of the historic steepness in the long end of the yield curve during the quarter and is expected to result in a positive spread of approximately 128 basis points for the next two years. Also in first quarter 2002, First Midwest lengthened the duration of its FHLB advances from a weighted average maturity of 11 months at March 31, 2001 to 23 months at March 31, 2002 in anticipation of an upward fluctuation in interest rates over the next forward period.

15

Volume/Rate Analysis

The table below summarizes the changes in average interest-earning assets and interest-bearing liabilities as well as the average rates earned and paid on these assets and liabilities, respectively, for the quarters ended March 31, 2002 and 2001. The table also details the increase and decrease in income and expense for each major category of assets and liabilities and analyzes the extent to which such variances are attributable to volume and rate changes. Interest income and yields are presented on a tax-equivalent basis.

Quarters Ended March 31, 2002 and 2001
		Average Balances								Average Interest Rates Earned/Paid					Interest Income/Expense							Increase/(Decrease) in Interest Income/Expense Due to:
													Basis
							Increase						Points							Increase
		2002		2001			(Decrease)			2002		2001	Inc/(Dec)		2002		2001			(Decrease)		Volume		Rate		Total
Fed funds sold and other    short-term investments		$	4,662		$	5,966	$	(1,304)		1.89%		6.44%	(4.55%)		$	22	$	96		$	(74)	$	(17)	$$	(57)	$	(74)
Mortgages held for sale		7,668		5,583			2,085			7.30%		6.95%	0.35%		140		97			43		38		5		43
Securities available for sale		1,877,896		2,000,944			(123,048)			6.11%		6.98%	(0.87%)	%	28,695		34,908			(6,213)		(2,059)		(4,154)		(6,213)
Securities held to maturity		92,447		84,897			7,550			6.76%	6	8.46%	(1.70%)		1,563		1,796			(233)		185		(418)		(233)
Loans net of unearned    discount		3,360,377		3,258,002			102,375			6.79%		8.52%	(1.73%)		57,036		69,372			(12,336)		2,261		(14,597)		(12,336)
Total interest-earning assets		$	5,343,050	$		5,355,392	$	(12,342)		6.55%		7.94%	(1.39%)		$	87,456	$	106,269		$	(18,813)	$	408	$	(19,221)	$	(18,813)
Savings deposits		$	433,456	$		450,701	$	(17,245)		0.98%		1.94%	(0.96%)		$	1,067	$	2,185		$	(1,118)	$	(81)	$	(1,037)	$	(1,118)
NOW accounts		685,583		438,707			246,876		2	1.83%	1	1.92%	(0.09%)		3,129		2,109			1,020		1,121		(101)		1,020
Money market deposits		570,216		531,628			38,588			1.98%		4.07%	(2.09%)		2,820		5,409			(2,589)		426		(3,015)		(2,589)
Time deposits		1,736,593		2,054,015			(317,422)		3	3.59%		5.92%	(2.33%)		15,600		30,414			(14,814)		(4,178)		(10,636)		(14,814)
Borrowed funds		1,114,313		1,110,898			3,415			2.54%		5.63%	(3.09%)		7,080		15,636			(8,556)		48		(8,604)		(8,556)
Total interest-bearing
	liabilities	$	4,540,161	$		4,585,949	$	(45,788)		2.62%		4.86%	(2.24%)		$	29,696	$	55,753		$	(26,057)	$	(2,664)	$$	(23,393)	$	(26,057)
Net interest margin / income										4.32%		3.77%	0.55%	%	$	57,760	$	50,516	$		7,244	$	3,072	$	4,172	$		7,244

			2002		2001
Net Interest Margin Trend By Quarter				1st	4th	3rd	2nd	1st
	Yield on interest earning assets			6.55%	6.91%	7.44%	7.69%	7.94%
	Rates paid on interest bearing liabilities			2.62%	3.04%	3.71%	4.27%	4.86%
		Net interest margin		4.32%	4.33%	4.27%	4.04%	3.77%

16

Noninterest Income

Excluding $704 in net security gains realized in first quarter 2001, total noninterest income remained flat at $16,142 in first quarter 2002 as compared to $16,222 for the same 2001 quarter. Nonetheless, the first quarter 2002 saw continued improvement across all major components of noninterest income excluding corporate-owned life insurance. The factors resulting in the year-to-year changes are discussed below.

Service charges on deposit accounts increased 4.8% to $5,756 in the first quarter of 2002 as compared to $5,492 for the same 2001 period. The $264 increase is primarily attributable to higher service charges on business checking accounts as a result of greater transaction volumes. Other service charges, commissions and fees increased by $26 to $4,293 for the quarter ended March 31, 2002 over the prior year's like quarter 2001 quarter of $4,267 with increases seen in commissions on mortgage sales and higher debit card fee income offset by a reduction in other earnings and commissions.

Trust and investment management fees for the first quarter 2002 increased $35, or 1.3%, to $2,708 as compared to $2,673 for the prior year's like quarter due to growth in new business and expansion of existing relationships. Likewise trust assets under management grew by approximately $143 million from $1.845 billion at March 31, 2001 to $1.988 billion at March 31, 2002. Trust fees generally follow the amount of total assets under management, as well as conditions in the equity and credit markets, as such fees on certain accounts are based on market value.

First Midwest's investment in corporate owned life insurance generated $1,698 in income for the first quarter 2002 for a decrease of $570, or 25.1%, as compared to the same 2001 period. Life insurance policies are maintained only on officers of the Company with their consents. The decrease in the 2002 quarter was related to the renegotiation in first quarter 2001 of certain of the underlying insurance contracts through the establishment of a stable value insurance contract enhancement as well as a shortening in the duration of the underlying assets undertaken to provide stability to this income stream. This redeployment into shorter duration assets combined with the accelerated decrease in market interest rates that occurred during the third and fourth quarters of 2001 resulted in the lower level of income being credited on the life insurance assets in first quarter 2002.

Other income increased by $165, or 10.8%, to $1,687 for the first quarter 2002 as compared to $1,522 for the year-ago like period. Such increase is primarily attributable to gains on sale of assets and higher credit card fee income offset in part with lower ATM revenues.

Noninterest Expense

Noninterest expense totaled $35,636 for the quarter ended March 31, 2002 as compared to the same period in 2001 of $35,093 for an increase of $543, or 1.5%. Factoring out the elimination of goodwill amortization expense pursuant to the adoption of FASB No. 142, total noninterest expenses for first quarter 2002 was 3.2% above the 2001 quarter. A comparison of the major categories of noninterest expense is discussed below.

Salaries and wages increased by $765, or 5.3%, to $15,126 for the quarter ended March 31, 2002 as compared to prior year levels of $14,361 largely due to annual salary increases approximating 4.3% and higher commissions paid to the mortgage origination sales staff as a result of greater sales volumes.

Retirement and other employee benefits increased by $365, or 8.7%, to $4,433 in the first quarter of 2002 compared to the year-ago like period of $4,077. Higher employee healthcare insurance and increases in payroll taxes in connection with the salary and wage change as well as an increase in unemployment tax rates principally accounted for the increase in the current period.

For the quarter ended March 31, 2002, occupancy expenses decreased $599, or 14.6%, as compared to the 2001 period of $4,114. The decrease in occupancy expense is primarily attributable to a reduction in snow removal costs and lower utility costs resulting from favorable weather conditions in 2002 as compared to prior year. The current quarter decrease in equipment expense of $72, or 3.7%, as compared to the 2001 period of $1,954, is reflective of cost savings realized in connection with the renegotiation of terms on various equipment maintenance contract costs conducted in the third quarter 2001.

Technology and related costs decreased $75, or 3.0%, to $2,466 in first quarter 2002 as compared to $2,541 for the 2001 period due to lower data network costs as a result of renegotiated contract terms.

17

Professional services increased by $369, or 27.2%, to $1,726 for the quarter ended March 31, 2002 as compared to the year-ago like period of $1,357. Of such increase, $183 is attributable to the costs associated with a home equity promotion. Also contributing to the increase are greater legal fees in connection with loan remediation activities.

Advertising and promotions increased $78, or 8.8%, for the quarter ended March 31, 2002 as compared to the same period in 2001. The expense levels in the 2002 period saw a return to more normalized levels as the prior year experienced a shift in marketing strategy and the scaling back of certain advertising programs.

Other expenses decreased $279, or 4.8%, for the first quarter 2002 as compared to the prior year period primarily due to the elimination of $540 in goodwill expense as referred to above and was partially offset by a $144 loss on sale of Company-owned land incurred during first quarter 2002.

As a result of top line revenue growth from net interest income and continued strong cost controls, the efficiency ratio for first quarter 2002 dropped to a record 47.3% as compared to 51.4% for first quarter 2001 and 49.7% for full year 2001.

Income Tax Expense

First Midwest's accounting policies underlying the recognition of income taxes in the statement of condition and income are included in the "Notes to Consolidated Financial Statements" contained in its 2001 Annual Report on Form 10-K.

Income tax expense totaled $7,627 for the quarter ended March 31, 2002, increasing from $5,939 for the same year-ago like period and reflects effective income tax rates of 25.7% and 23.5%, respectively. The increase in effective tax rate is primarily attributable to a decrease in corporate owned life insurance income in 2002.

Credit Quality and the Reserve for Loan Losses

The following table summarizes certain credit quality data for the last five calendar quarters:

		2002		2001
		March 31		December 31		September 30		June 30		March 31
Nonaccrual loans		$	15,277	$	16,847	$	21,425	$	20,518	$	22,453
Foreclosed real estate		4,289		3,630		3,651		2,425		1,246
	Total nonperforming assets	$	19,566	$	20,477	$	25,076	$	22,943	$	23,699
90 days past due and still accruing interest		$	4,739	$	5,783	$	6,117	$	5,187	$	5,339
Nonperforming loans to total loans			0.45%		0.50%		0.62%		0.61%		0.68%
Nonperforming assets to total loans plus     foreclosed real estate			0.58%		0.61%		0.73%		0.68%		0.72%
Reserve for loan losses to loans			1.42%		1.42%		1.38%		1.38%		1.39%
Reserve for loan losses to     nonperforming loans			313%		283%		223%		228%		202%
Provision for loan losses		$	5,055	$	6,313	$	5,248	$	4,065	$	3,458
Net loans charged-off		$	5,026	$	6,313	$	4,208	$	2,781	$	3,130
Net loans charged-off to average loans			0.61%		0.73%		0.49%		0.34%		0.39%

Nonaccrual loans, totaling $15,277 at March 31, 2002 are comprised of commercial, industrial and agricultural loans (56%), real estate loans (35%) and consumer loans (9%). Foreclosed real estate, totaling $4,289 at March 31, 2002 primarily represents real estate loans on 1-4 family properties. First Midwest's disclosure with respect to impaired loans is contained in Note 4 to the interim consolidated financial statements, located on page 8*.

18

Nonperforming loans continued to improve in first quarter 2002, dropping 9% on a linked-quarter basis and 32% as compared to quarter-end March 2001. As a consequence, nonperforming loans declined at March 31, 2002 to .45% of loans from .50% at year-end 2001 and .68% at the end of first quarter 2001. Reflecting further credit quality improvement, loans 90 days or more past due decreased by over $1 million on a linked-quarter basis.

Transactions in the reserve for loan losses during the quarters ended March 31, 2002 and 2001 are summarized in the following table:

			Quarters Ended March 31,
			2002		2001
Balance at beginning of period			$	47,745	$	45,093
	Loans charged-off		(5,865)		(3,704)
	Recoveries of loans previously charged-off		839		574
		Net loans (charged-off)	(5,026)		(3,130)
	Provision for loan losses		5,055		3,458
Balance at end of period			$	47,774	$	45,421

Reflective of the continued weakened economy and an aggressive charge-off strategy, loan charge-offs, net of recoveries, for the 2002 first quarter totaled $5,026, or .61% of average loans, up from first quarter 2001 of $3,130, or .39% of average loans, but improved from .73% on a linked-quarter basis. Provisions for loan losses fully covered net charge-offs for first quarter 2002 resulting in the ratio of the reserve for loan losses to total loans at quarter-end being maintained at 1.42%, the same level as year-end 2001. As a consequence of the general improvement in credit quality, the reserve for loan losses at March 31, 2002 represented 313% of nonperforming loans as compared to 202% at the end of 2001's first quarter and 283% at year-end 2001.

The accounting policies underlying the establishment and maintenance of the reserve for loan losses through provisions charged to operating expense are included in Note 1 to the "Notes to Consolidated Financial Statements" on page * of this Form 10-Q.

The provision for loan losses in any given period is dependent upon many factors, including loan growth, changes in the composition of the loan portfolio, net charge-offs, delinquencies, collateral values, Management's assessment of current and prospective economic conditions, and the level of the reserve for loan losses. First Midwest maintains a reserve for loan losses to absorb losses inherent in the loan portfolio. The appropriate level of the reserve for loan losses is determined by systematically performing a review of the loan portfolio quality as required by First Midwest's credit administration policy. The reserve for loan losses consists of three elements; (i) specific reserves established for any impaired commercial, real estate commercial and real estate construction loan for which the recorded investment in the loan exceeds the measured value of the loan; (ii) reserves based on historical loan loss experience; and, (iii) reserves based on general economic conditions as well as specific economic factors in the markets in which First Midwest operates.

Loans within the portfolio that are selected for review to determine whether specific reserves are required include both loans over a specified dollar limit as well as loans where the internal credit rating is below a predetermined classification. Loans subject to this review process generally include commercial and agricultural loans, real estate commercial and real estate construction loans. Specific reserves for these loans are determined in accordance with the accounting policies referred to above. Consumer and other retail loan reserve allocations are based upon the evaluation of pools or groups of such loans. The portion of the reserve based on historical loan loss experience is determined statistically using a loss migration analysis that examines loss experience and the related internal rating of loans charged off. The loss migration analysis is performed quarterly and loss factors are periodically updated based on actual experience. The portion of the res erve based on general economic conditions and other factors is considered the unallocated portion of the reserve. This portion is determined based upon general economic conditions and involves a higher degree of subjectivity in its determination. This segment of the reserve considers risk factors that may not have manifested themselves in First Midwest's historical loss experience, which is used to determine the allocated component of the reserve.

The distribution of the loan portfolio is presented in Note 3 to the interim consolidated financial statement located on page *. The loan portfolio consists predominantly of loans originated by First Midwest from its primary markets and generally represents credit extension to multi-relationship customers.

19

Capital

Capital Measurements

The table below compares First Midwest's capital structure to the minimum capital ratios required by its primary regulator, the Federal Reserve Board ("FRB"). Both First Midwest and its bank subsidiary First Midwest Bank ("FMB") are subject to the minimum capital ratios defined by banking regulators pursuant to the FDIC Improvement Act ("FDICIA") and have capital measurements in excess of the levels required by their bank regulatory authority to be considered "well-capitalized," which is the highest capital category established under the FDICIA.

		Actual		Capital Required
		First Midwest	FMB	Minimum Required FRB	Minimum Well- Capitalized FDICIA
As of March 31, 2002:
	Tier I capital to risk-based assets	9.94%	9.26%	4.00%	6.00%
	Total capital to risk-based assets	11.05%	10.37%	8.00%	10.00%
	Leverage ratio	7.45%	6.97%	3.00%	5.00%
As of December 31, 2001:
	Tier I capital to risk-based assets	9.96%	9.68%	4.00%	6.00%
	Total capital to risk-based assets	11.08%	10.81%	8.00%	10.00%
	Leverage ratio	7.43%	7.25%	3.00%	5.00%

Dividends

As a result of improved performance from operations as well as First Midwest's perceived future prospects, the Board of Directors has increased the quarterly dividend every year since 1993. The following table summarizes the dividend increases declared during the years 1994 through 2001:

Date	Quarterly Rate Per Share		% Increase
November 2001	$	0.170	6%
November 2000		0.160	11%
November 1999		0.144	13%
November 1998		0.128	7%
November 1997		0.120	13%
November 1996		0.106	18%
February 1996		0.090	13%
February 1995		0.080	15%
February 1994		0.070	13%

20

Capital Management

First Midwest has continued to follow a policy of retaining sufficient capital to support growth in total assets and returning excess capital to shareholders in the form of dividends and through common stock repurchases, with the latter resulting in an increase in the percentage ownership of the Company by existing shareholders.

In August, 2001, First Midwest's Board of Directors authorized the repurchase of up to 3.125 million of its common shares, or 6.25% of shares outstanding. The 2001 plan is the eighth such program since the Company's formation in 1983 and authorizes repurchases in both open market and privately negotiated transactions and has no execution time limit.

The following table summarizes the shares repurchased by First Midwest for the prior three calendar years and for the current quarter:

	Quarter		Years Ended December 31,
	Ended March 31, 2002		2001		2000		1999
Shares repurchased	428		2,604		607		3,336
Cost	$	12,157	$	64,582	$	12,195	$	70,043

As of March 31, 2002, First Midwest had 1,528 shares remaining to be repurchased under its current share repurchase authorization.

FORWARD LOOKING STATEMENTS

Statements made in the preceding "Management's Discussion and Analysis of Financial Condition and Results of Operations" section which are not purely historical are forward-looking statements with respect to the goals, plan objectives, intentions, expectations, financial condition, results of operations, future performance and business of First Midwest, including, without limitation, (i) loan and deposit growth, market interest rates on net interest income and net interest margin, wholesale funding sources, provision and reserve for loan losses, nonperforming loan levels and net charge-offs, collateral value and economic conditions, noninterest income and expenses, diluted earnings per share growth rates for 2002, and dividends to shareholders, and (ii) statements preceded by, followed by or that include the words "may", "would", "could", "should", "expects", "projects", "anticipates", "believes", "estimates", "plans", "intends", "targets" or similar expressions.

Forward-looking statements involve inherent risks and uncertainties, and important factors (many of which are beyond First Midwest's control) that could cause actual results to differ materially from those set forth in the forward-looking statements, including the following, in addition to those contained in First Midwest's reports on file with the Securities and Exchange Commission: general economic or industry conditions, nationally and/or in the communities in which First Midwest conducts business, changes in the interest rate environment, legislation or regulatory requirements, conditions of the securities markets, deposit flows, cost of funds, demand for loan products, demand for financial services, competition, changes in quality or composition of First Midwest's loan and investment portfolios, assumptions used to evaluate the appropriate level of the reserve for loan losses, the impact of future earnings performance and capital levels on dividends declared by the Board of Directors , changes in accounting principals, policies or guidelines, financial or political instability, acts of war or terrorism, other economic, competitive, governmental, regulatory and technical factors affecting First Midwest's operations, products, services and prices.

Accordingly, results actually achieved may differ materially from expected results in these statements. Forward-looking statements speak only as of the date they are made. First Midwest does not undertake, and specifically disclaims, any obligation to update any forward-looking statements to reflect events or circumstances occurring after the date of such statement.

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PART II. OTHER INFORMATION

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits - See Exhibit Index appearing on page 23*.

(b) Forms 8-K and 8-K/A -

On February 27, 2002, First Midwest filed a report on Form 8-K to make available the slide presentation presented at the Super Community Bank Conference.

• On February 22, 2002, First Midwest filed a report on Form 8-K to announce the retirement of its CFO.

• On February 20, 2002, First Midwest filed a report on Form 8-K to announce the declaration of its 1st quarter 2002 dividend.

• On February 19, 2002 First Midwest filed a report on Form 8-K announcing its participation in the Super Community Bank Conference.

• On January 17, 2002, First Midwest filed a report on Form 8-K announcing its earnings results for the quarter and year ended December 31, 2001.

SIGNATURES

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 thereunto duly authorized.

First Midwest Bancorp, Inc.

/s/ DONALD J. SWISTOWICZ

Donald J. Swistowicz
Executive Vice President*

Date: May 14, 2002

* Duly authorized to sign on behalf of the Registrant.

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EXHIBIT INDEX

Exhibit Number	Description of Documents	Sequential Page #
3	Restated Certificate of Incorporation	24
15	Acknowledgment of Ernst & Young LLP	34
99	Independent Accountant's Review Report	35

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EX-3

Exhibit 3

RESTATED CERTIFICATE OF INCORPORATION OF

FIRST MIDWEST BANCORP, INC.

ARTICLE FIRST. Name.

The name of the Corporation is FIRST MIDWEST BANCORP, INC.

ARTICLE SECOND. Registered Agent.

The registered office of the Corporation in the State of Delaware is located at 306 South State Street, in the City of Dover, County of Kent. The name of its registered agent at such address is United States Corporation Company.

ARTICLE THIRD. Purpose.

The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware.

ARTICLE FOURTH. Authorized Stock

The total number of shares of stock which the Corporation shall have authority to issue is One Hundred One Million (101,000,000) shares, of which One Million (1,000,000) shares shall be shares of Preferred Stock without par value (hereinafter sometimes referred to as "Preferred Stock"), and One Hundred Million (100,000,000) shares shall be shares of Common Stock, $0.01 par value per share (hereinafter sometimes referred to as "Common Stock").

PART I - PREFERRED STOCK

The Board of Directors is expressly authorized to adopt, from time to time, a resolution or resolutions providing for the issue of Preferred Stock in one or more series, to fix the number of shares in each such series and to fix the designations and the powers, preferences and relative, optional or other special rights, and the qualifications, limitations and restrictions thereof, of each such series. The authority of the Board of Directors with respect to each such series shall include a determination of the following (which may vary as between the different series of Preferred Stock):

(a) The number of shares constituting the series and the distinctive designation of the series;

(b) The dividend rate on the shares of the series, the conditions and dates upon which dividends thereon shall be payable, the extent, if any, to which dividends thereon shall be cumulative, and the relative rights of preference, if any, of payment of dividends thereon;

(c) Whether or not the shares of the series are redeemable and, if redeemable, including whether such shares shall be redeemable for cash, property or rights or any combination thereof and the times during which such shares shall be redeemable and the amount per share payable in case of redemption, which amount may, but need not, vary according to the time and circumstances of such action;

(d) The amount payable in respect of the shares of the series, in the event of any liquidation, dissolution or winding up of the Corporation, which amount may, but need not, vary according to the time or circumstances of such action, and the relative rights of preference, if any, of payment of such amount;

(e) Any requirement as to a sinking fund for the shares of the series, or any requirement as to the redemption, purchase or other retirement by the Corporation of the shares of the series;

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(f) The right, if any, to exchange or convert shares of the series into shares of any other series or class of stock of the Corporation and the rate or basis, time, manner and condition of exchange or conversion;

(g) The voting rights, if any, to which the holders of shares of the series shall be entitled; and

(h) Any other term, condition or provision [not involving any further participation in the assets or profits of the Corporation other than as permitted and provided for pursuant to the provisions of paragraphs (b), (c), (d), (e) and (f) of this Part I] with respect to the series as the Board of Directors may deem advisable and as shall not be inconsistent with the provisions of this Article Fourth.

PART II - COMMON STOCK

(a) Dividends. Subject to any rights to receive dividends to which the holders of any outstanding Preferred Stock may be entitled, the holders of the Common Stock shall be entitled to receive dividends, if and when declared payable from time to time by the Board of Directors from any funds legally available therefore.

(b) Liquidation. In the event of any liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, after payment or provision for payment of the debts and other liabilities of the Corporation and the preferential amounts to which the holders of any outstanding Preferred Stock shall be entitled, the holders of the Common Stock shall be entitled to share ratably in the remaining assets of the Corporation. The merger or consolidation of the Corporation into or with any other corporation, or the merger of any other corporation into it, or a sale of all or substantially all of the assets of the Corporation, or any purchase or redemption of shares of stock of the Corporation of any class, shall not be deemed to be a liquidation, dissolution or winding up of the Corporation for purposes of this paragraph (b).

(c) Voting. Each outstanding share of Common Stock of the Corporation shall entitle the holder thereof to one vote, and, except as otherwise stated or expressed in a resolution or resolutions adopted by the Board of Directors providing for the issue of any Preferred stock or as otherwise provided by law, the exclusive voting power for all purposes shall be vested in the holders of Common Stock.

PART III - GENERAL PROVISIONS

(a) No Stockholder Consents in Lieu of Voting. No action required to be taken or which may be taken at any annual or special meeting of stockholders of the Corporation may be taken without a meeting, and the power of stockholders to consent in writing, without a meeting, to the taking of any action is specifically denied.

(b) Right to Call Special Meetings. Special meetings of the stockholders of the Corporation may be called only by the Board of Directors or the Chairman of the Board of Directors or President of the Corporation; provided, however, that, notwithstanding the foregoing, a special meeting of stockholders may be called by the holders of at least 51% of the voting power of the then outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors (the "Voting Stock") solely for the purpose of removing a director or directors for cause [it being understood that, for purposes of this paragraph (b), each share of the Voting Stock shall have the number of votes granted to it pursuant to this Article Fourth].

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(c) Removal of Directors. No director may be removed from office except for cause; provided, that, in addition to any affirmative vote required by law or any other provision of this Restated Certificate of Incorporation, the removal of any director shall require the affirmative vote of the holders of at least 67% of the voting power of the then outstanding Voting Stock [it being understood that, for purposes of this paragraph (c), each share of the Voting Stock shall have the number of votes granted to it pursuant to this Article Fourth], and such affirmative vote shall be required notwithstanding the fact that a lesser percentage may be specified by law or in any agreement with any national securities exchange or otherwise.

(d) Advance Notice of Stockholder Proposals. At any annual or special meeting of stockholders, proposals by stockholders and persons nominated by stockholders for election as directors shall be considered only if advance notice thereof has been timely given as provided herein by a stockholder of record as of the time of such notice who is entitled to vote at the meeting and such proposals or nominations are otherwise proper for consideration under applicable law and this Restated Certificate of Incorporation and the By-laws of the Corporation. Notice of any proposal to be presented by any stockholder or of the name of any person to be nominated by any stockholder for election as a director of the Corporation at any meeting of stockholders shall be delivered to the Secretary of the Corporation at its principal executive office not less than 120 nor more than 180 days prior to the date of the meeting; provided, however, that if the date of the meeting is first publicly announced or disclosed (in a public filing or otherwise) less than 130 days prior to the date of the meeting, such advance notice shall be given not more than 10 days after such date is first so announced or disclosed. Public notice shall be deemed to have been given more than 130 days in advance of the annual meeting if the Corporation shall have previously disclosed, in the By-laws or otherwise, that the annual meeting in each year is to be held on a determinable date, unless and until the Board determines to hold the meeting on a different date. Any stockholder who gives notice of any such proposal shall deliver therewith the text of the proposal to be presented and a brief written statement of the reasons why such stockholder favors the proposal and setting forth such stockholder's name and address, the number and class of all shares of each class of stock of the Corporation beneficially owned by such stockholder and any material interest of such stockholder in the proposal (other than as a stockholder). Any st ockholder desiring to nominate any person for election as a director of the Corporation shall deliver with such notice a statement in writing setting forth the name of the person to be nominated, the number and class of all shares of each class of stock of the Corporation beneficially owned by such person, the information regarding any such person required by paragraphs (a), (e) and (f) of Item 401 of Regulation S-K adopted by the Securities and Exchange Commission (or the corresponding provisions of any regulation subsequently adopted by the Securities and Exchange Commission applicable to this Corporation), such person's signed consent to serve as a director of the Corporation if elected, such stockholder's name and address and the number and class of all shares of each class of stock of the Corporation beneficially owned by such stockholder. As used herein, shares "beneficially owned" shall mean all shares as to which such person, together with such person's affiliates and associates (as defined in Rule 12b-2 under the Securities Exchange Act of 1934), may be deemed to beneficially own pursuant to Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, as well as all shares as to which such person, together with such person's affiliates and associates, has the right to become the beneficial owner pursuant to any agreement or understanding, or upon the exercise of warrants, options or rights to convert or exchange (whether such rights are exercisable immediately or only after the passage of time or the occurrence of conditions). The person presiding at the meeting, in addition to making any other determinations that may be appropriate to the conduct of the meeting, shall determine whether such notice has been duly given and shall direct that proposals and nominees not be considered if such notice has not

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been given.

ARTICLE FIFTH. Board of Directors.

(a) The business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors.

(b) The number of directors constituting the Board of Directors of the Corporation shall be such number, not fewer than three nor more than twenty, as shall be fixed from time to time by resolution of the Board of Directors adopted by the affirmative vote of at least a majority of all members thereof.

(c) The Board of Directors shall be and is divided into three classes, Class I, Class II and Class III, which shall be as nearly equal in number as possible. Each director shall serve for a term ending on the date of the third annual meeting of stockholders of the Corporation following the annual meeting at which such director was elected; provided, however, that (1) each director in Class I elected at the annual meeting of stockholders in 1985 shall hold office until the annual meeting of stockholders in 1986, (2) each director in Class II elected at the annual meeting of stockholders in 1985 shall hold office until the annual meeting of stockholders in 1987, and (3) each director in Class III elected at the annual meeting of stockholders in 1985 shall hold office until the annual meeting of stockholders in 1988.

(d) In the event of any increase or decrease in the authorized number of directors, (1) each director then serving as such shall nevertheless continue as a director of the class of which he or she is a member until the expiration of his or her current term, or his or her prior death, retirement, resignation, or removal, and (2) the newly created or eliminated directorships resulting from such increase or decrease shall be apportioned by the Board of Directors among the three classes of directors so as to maintain such classes as nearly equal in number as possible.

(e) Notwithstanding any of the foregoing provisions of this Article Fifth, each director shall serve until his or her successor is elected and qualified or until his or her death, retirement, resignation or removal. Should a vacancy occur or be created, whether arising through death, retirement, resignation or removal of a director or through an increase in the number of directors of any class, such vacancy shall be filled by a majority vote of the remaining directors of all classes then in office although less than a quorum, or by the sole remaining director. A director so elected to fill a vacancy shall serve for the remainder of the then present term of office of the class in which the vacancy shall have occurred or shall have been created.

(f) Notwithstanding any of the foregoing provisions of this Article Fifth, whenever the holders of any outstanding class or series of Preferred Stock shall have the right, voting separately by class or series, to elect directors at an annual or special meeting of stockholders, the election, term of office, filling of vacancies and other features of such directorships shall be governed by the terms of this Restated Certificate of Incorporation and of the resolution of the Board of Directors providing for the issue of such class or series of Preferred Stocked applicable thereto, and such directors so elected shall not be divided into classes pursuant to this Article Fifth, unless expressly provided by such terms.

(g) The Board of Directors, by resolution adopted by the affirmative vote of at least a majority of all members thereof, shall have concurrent power with the stockholders to adopt, amend or repeal the By-laws of the Corporation; provided, however, that the By-laws of the Corporation shall not be adopted, amended or repealed by the stockholders except by the affirmative vote of the holders of at least 67% of the voting power of the then outstanding Voting Stock, voting together as a single class [it being understood that, for purposes of this paragraph (h), each share of the Voting Stock shall have the number of votes granted to it pursuant to Article Fourth hereof], and such affirmative vote shall be required notwithstanding the fact that a lesser percentage may be specified by law or in any agreement with any national securities exchange or otherwise.

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(h) Wherever the term "Board of Directors" is used in this Restated Certificate of Incorporation, such term shall mean the Board of Directors of the Corporation; provided, however, that, to the extent any committee of directors of the Corporation is lawfully entitled to exercise the powers of the Board of Directors, such committee, to the extent provided by resolution of the Board of Directors or the By-laws, may exercise any power or authority of the Board of Directors under this Restated Certificate of Incorporation in the management of the business and affairs of the Corporation.

(i) The books of the Corporation (subject to the provisions of the laws of the State of Delaware) may be kept outside of the State of Delaware at such places as may be from time to time designated by the Board of Directors. Elections of directors need not be by ballot unless the By-laws so provide.

(j) No Director of the Corporation shall be personally liable to the Corporation or any of its stockholders for monetary damages for breach of fiduciary duty as a Director, except to the extent that such exemption from liability or limitation thereof is not permitted under the General Corporation Law of the State of Delaware, as it may be in effect from time to time. No amendment to or repeal of this paragraph (k) shall apply to or have any effect on the liability or alleged liability of any Director of the Corporation for or with respect to any acts or omissions of such Director occurring prior to such amendment or repeal.

ARTICLE SIXTH. Indemnification.

Without limiting in any manner any power of the Corporation conferred by statute, each person who is or was a director or officer of the Corporation shall be indemnified by the Corporation to the full extent permitted by the General Corporation Law of the State of Delaware, as it may be in effect from time to time, against any liability, cost or expense incurred by him in his capacity as a director or officer or arising out of his status as a director or officer.

ARTICLE SEVENTH. Certain Business Combinations.

(a) Higher Vote for Certain Business Combinations.

In addition to any affirmative vote required by law or any other provision of this Restated Certificate of Incorporation, and except as otherwise expressly provided in paragraph (b) of this Article Seventh:

(1) Any merger or consolidation of the Corporation or any Subsidiary with (A) any Interested Stockholder or (B) any other corporation (whether or not itself an Interested Stockholder) which is, or after such merger or consolidation would be, an Affiliate of an Interested Stockholder; or

(2) Any sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one transaction or a series of transactions) to or with any Interested Stockholder or any Affiliate of any Interested Stockholder of any assets of the Corporation or any Subsidiary having an aggregate Fair Market Value of $5 million or more; or

(3) The issuance or transfer by the Corporation or any Subsidiary (in one transaction or a series of transactions) of any securities of the Corporation or any Subsidiary to any Interested Stockholder or any Affiliate of any Interested Stockholder in exchange for cash, securities or other property (or a combination thereof) having an aggregate Fair Market value of $5 million or more; or

(4) The adoption of any plan or proposal for the liquidation or dissolution of the Corporation proposed by or on behalf of an Interested Stockholder or any Affiliate of any Interested Stockholder; or

(5) Any reclassification of securities (including any reverse stock split), or recapitalization of the Corporation, or any merger or consolidation of the Corporation with any of its Subsidiaries or

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any other transaction (whether or not with or into or otherwise involving an Interested Stockholder) which has the effect, directly or indirectly, of increasing the proportionate share of the outstanding shares of any class of equity or convertible securities of the Corporation or any Subsidiary which is directly or indirectly owned by any Interested Stockholder or any Affiliate of any Interested Stockholder;

shall require the affirmative vote of the holders of at least 80% of the voting power of the then outstanding Voting Stock, voting together as a single class [it being understood that, for purposes of this paragraph (a), each share of the Voting Stock shall have the number of votes granted to it pursuant to Article Fourth hereof]. Such affirmative vote shall be required notwithstanding the fact that no vote may be required, or that a lesser percentage may be specified, by law or in any agreement with any national securities exchange or otherwise. The term "Business Combination", as used in this Article Seventh, means any transaction which is referred to in any one or more of clauses (1) through (5) of this paragraph (a).

(b) When Higher Vote is Not Required.

The provisions of paragraph (a) of this Article Seventh shall not be applicable to any particular Business Combination, and such Business Combination shall require only such affirmative vote, if any, as is required by law or any other provision of this Restated Certificate of Incorporation or the By-laws of the Corporation, if all the conditions specified in either subparagraph (b) (1) or (2) below are met:

(1) Approval by Disinterested Directors.

Such Business Combination shall have been approved by a majority of the Disinterested Directors.

(2) Price and Procedure Requirements.

All of the following conditions shall have been met:

(A) The aggregate amount of the cash and the Fair Market value as of the date of the consummation of such Business Combination of consideration other than cash to be received per share by holders of Common Stock in such Business Combination shall be at least equal to the highest of the following:

(i) (if applicable) the highest per share price (including any brokerage commissions, transfer taxes and soliciting dealers' fees) paid by the Interested Stockholder involved for any shares of Common Stock acquired by it (I) within the two-year period ending on the date of the first public announcement of the proposal of such Business Combination (the "Announcement Date") or (II) in the transaction in which it became an Interested Stockholder, whichever is higher;

(ii) (if applicable) an amount which bears the same or a greater percentage relationship to the Fair Market Value per share of Common Stock on the Announcement Date or on the date on which the Interested Stockholder involved became an Interested Stockholder (such latter date is referred to in this Article Seventh as the "Determination Date"), whichever is higher, as the highest per share price determined under subparagraph (b)(2)(A)(i) bears to the Fair Market Value per share of Common Stock on the first day within the two-year period ending on the Announcement Date on which such Interested Stockholder acquired beneficial ownership of any share of Common Stock; and

(iii) the Fair Market Value per share of Common Stock on the Announcement Date or on the Determination Date, whichever is higher.

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(B) The aggregate amount of the cash and the Fair Market Value as of the date of the consummation of such Business Combination of consideration other than cash to be received per share by holders of shares of any class of outstanding Voting Stock, other than Common Stock, shall be at least equal to the highest of the following [it being intended that the requirements of this subparagraph (b)(2)(B) shall be required to be met with respect to each class of outstanding Voting Stock, other than Common Stock, whether or not the Interested Stockholder involved has previously acquired any shares of such class of Voting Stock]:

(i) (if applicable) the highest per share price (including any brokerage commissions, transfer taxes and soliciting dealers' fees) paid by the Interested Stockholder involved for any share of such class of Voting Stock acquired by it (I) with the two-year period ending on the Announcement Date or (II) in the transaction in which it became an Interested Stockholder, whichever is higher;

(ii) (if applicable) the highest preferential amount per share to which the holders of shares of such class of Voting Stock are entitled in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Corporation;

(iii) (if applicable) an amount which bears the same or a greater percentage relationship to the Fair Market Value per share of such class of Voting Stock on the Announcement Date or on the Determination Date, whichever is higher, as the highest per share price determined under subparagraph (b)(2)(B)(i) bears to the Fair Market Value per share of such class of Voting Stock on the first day within two year period ending on the Announcement Date on which the Interested Stockholder involved acquired beneficial ownership of any share of such class of Voting Stock; and

(iv) the Fair Market Value per share of such class of Voting Stock on the Announcement Date or on the Determination Date, whichever is higher.

(C) The consideration to be received by holders of a particular class of outstanding Voting Stock (including Common Stock) shall be in cash or in the same form as the Interested Stockholder involved has previously paid for shares of such class of Voting Stock. If such Interested Stockholder has paid for shares of any class of Voting Stock with varying forms of consideration, the form of consideration for such class of Voting Stock shall be either cash or the form used to acquire the largest number of shares of such class of Voting Stock previously acquired by it. The prices determined in accordance with subparagraphs (b)(2)(A) and (b)(2)(B) shall be subject to appropriate adjustment in the event of any stock dividend, stock split, combination of shares or similar event.

(D) After the Interested Stockholder involved has become an Interested Stockholder and prior to the consummation of such Business Combination: (i) there shall have been (I) no reduction in the annual rate of dividends paid on the Common Stock (except as necessary to reflect any subdivision of the Common Stock), except as approved by a majority of the Disinterested Directors, and (II) an increase in such annual rate of dividends as necessary to reflect any reclassification (including any reverse stock split), recapitalization, reorganization or any similar transaction which has the effect of reducing the number of outstanding shares of the Common Stock, unless the failure so to increase such annual rate is approved by a majority of the Disinterested Directors; and (ii) such Interested Stockholder shall not have become the beneficial owner of any additional shares of Voting Stock except as part of the transaction which results in such Interested Stockholder becoming an Interested Stockho lder.

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(E) After the Interested Stockholder involved has become an Interested Stockholder, such Interested Stockholder shall not have received the benefit, directly or indirectly (except proportionately as a stockholder), of any loans, advances, guarantees, pledges or other financial assistance or any tax credits or other tax advantages provided by the Corporation, whether in anticipation of or in connection with such Business Combination or otherwise.

(F) A proxy or information statement describing the proposed Business Combination and complying with the requirements of the Securities Exchange Act of 1934 and the rules and regulations thereunder (or any subsequent provisions replacing such Act, rules or regulations) shall be mailed to public stockholders of the Corporation at least 30 days prior to the consummation of such Business Combination (whether or not such proxy or information statement is required to be mailed pursuant to such Act or subsequent provisions).

(c) Certain Definitions.

For purposes of this Restated Certificate of Incorporation:

(1) The term "person" means any individual, firm, corporation or other entity.

(2) The term "Interested Stockholder" means any person (other than the Corporation or any Subsidiary and other than any profit-sharing, employee stock ownership or other employee benefit plan of the Corporation or any Subsidiary or any trustee of or fiduciary with respect to any such plan when acting in such capacity) who or which:

(A) is the beneficial owner, directly or indirectly, of 5% or more of the voting power of the outstanding Voting Stock; or

(B) is an Affiliate of the Corporation and at any time within the two-year period ending on the date in question was the beneficial owner, directly or indirectly, of 5% or more of the voting power of the then outstanding Voting Stock; or

(C) is an assignee of or has otherwise succeeded to any shares of Voting Stock which were at any time within the two-year period ending on the date in question beneficially owned by any Interested Stockholder, if such assignment or succession shall have occurred in the course of a transaction or series of transactions not involving a public offering within the meaning of the Securities Act of 1933, as amended.

(3) A person shall be a "beneficial owner" of any Voting Stock:

(A) which such person or any of his or its Affiliates or Associates beneficially owns, directly or indirectly, or

(B) which such person or any of his or its Affiliates or Associates has (i) the right to acquire (whether such right is exercisable immediately or only after the passage of time), pursuant to any agreement, arrangement or understanding or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise, or (ii) the right to vote pursuant to any agreement, arrangement or understanding; or

(C) which are beneficially owned, directly or indirectly, by any other person with which such person or any of its Affiliates or Associates has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting or disposing of any shares of Voting Stock.

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(4) For purposes of determining whether a person is an Interested Stockholder pursuant to subparagraph (c)(2), the number of shares of Voting Stock deemed to be outstanding shall include shares deem owned through application of subparagraph (c)(3) but shall not include any other shares of Voting Stock which may be issuable pursuant to any agreement, arrangement or understanding, or upon exercise of conversion rights, warrants or options, or otherwise. The phrase "Interested Stockholder involved" means, in respect of any Business Combination, the Interested Stockholder that, or whose Affiliate, is a party to or otherwise involved (other than merely as a stockholder of the Corporation) in such Business Combination.

(5) The terms "Affiliate" and "Associate" shall have the respective meanings ascribed to such terms in Rule 12b-2 of the General Rules and Regulations under the Securities Exchange Act of 1934, as in effect on March 1, 1985.

(6) The term "Subsidiary" means any corporation of which a majority of any class of equity security is owned, directly or indirectly, by the corporation; provided, however, that, for purposes of the definition of Interested Stockholder set forth in subparagraph (c)(2), the term "Subsidiary" shall mean only a corporation of which a majority of each class of equity security is owned, directly or indirectly, by the Corporation.

(7) The term "Disinterested Director" means, in respect of any Business Combination, any member of the Board of Directors who is unaffiliated with the Interested Stockholder involved in such Business Combination and who was a member of the Board of Directors prior to the time that such Interested Stockholder became an Interested Stockholder, and any successor of a Disinterested Director who is unaffiliated with such Interested Stockholder and who is recommended to succeed a Disinterested Director by a majority of Disinterested Directors then on the Board of Directors.

(8) The term "Fair Market Value" means: (A) in the case of stock, the highest closing sale price during the 30-day period ending on the date in question of a share of such stock on the Composite Tape for New York Stock Exchange-Listed Stocks, or, if such stock is not quoted on the Composite Tape, on the New York Stock Exchange, or, if such stock is not listed on such Exchange, on the principal United States securities exchange registered under the Securities Exchange Act of 1934 on which such stock is listed, or, if such stock is not listed on any such exchange, the highest closing bid quotation with respect to a share of such stock during the 30-day period ending on the date in question on the National Association of Securities Dealers, Inc. Automated Quotations System or any system then in use, or if no such quotations are available, the fair market value on the date in question of a share of such stock as determined by the Board of Directors in good faith; and (B) in the case of property other than cash or stock, the fair market value of such property on the date in question as determined by the Board of Directors in good faith.

(9) In the event of any Business Combination in which the Corporation survives, the phrase "consideration other than cash to be received", as used in subparagraphs (b)(2)(A) and (b)(2)(B), shall include the shares of any Common Stock and the shares of any other class of outstanding Voting Stock retained by the holders of such shares.

(d) Certain Powers of the Board of Directors.

A majority of the Board of Directors shall have the power and duty to determine, for purposes of this Article Seventh, on the basis of information known to them after reasonable inquiry, (1) whether a person is an Interested Stockholder, (2) the number of shares of Voting Stock beneficially owned by any person, (3) whether a person is an Affiliate or Associate of another, and (4) whether the assets which are the subject of any Business Combination have, or the consideration to be received for the

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issuance or transfer of securities by the Corporation or any Subsidiary in any Business Combination has, an aggregate Fair Market Value of $5 million or more. A majority of the Board of Directors shall have the further power to interpret all of the terms and provisions of this Article Seventh.

(e) No Effect on Fiduciary Obligations of Interested Stockholders.

Nothing contained in this Article Seventh shall be construed to relieve any Interested Stockholder from any fiduciary obligation imposed by law.

ARTICLE EIGHTH. Considerations for Board of Directors in Evaluation of Certain Acquisition Proposals.

In connection with the exercise of its judgment in determining what is in the best interests of the Corporation and its stockholders when evaluating a proposal by another person or persons to make a tender or exchange offer for any equity security of the Corporation or any Subsidiary, to merge or consolidate with the Corporation or any Subsidiary or to purchase or otherwise acquire all or substantially all of the assets of the Corporation or any Subsidiary, the Board of Directors of the Corporation shall, in addition to considering the adequacy of the amount to be paid in connection with any such transaction, consider all of the following factors and any other factors which it deems relevant: (a) the social and economic effects of the transaction on the Corporation and its Subsidiaries, the employees, depositors, loan and other customers and creditors or the Corporation and its Subsidiaries and the other elements of the communities in which the Corporation and its Subsidiaries operate or are located; (b) the business and financial condition and earnings prospects of the acquiring person or persons, including, but not limited to, debt service and other existing or likely financial obligations of the acquiring person or persons, and the possible effect of such conditions upon the Corporation and its Subsidiaries and the other elements of the communities in which the Corporation and its

Subsidiaries operate or are located; and (c) the competence, experience, and integrity of the acquiring person or persons and its or their management.

ARTICLE NINTH. Perpetual Existence.

The Corporation shall have perpetual existence.

ARTICLE TENTH. Amendments and Repeal.

(a) Notwithstanding the fact that a lesser percentage vote for the amendment or repeal of this Restated Certificate of Incorporation shall be specified by law or in any agreement with any national securities exchange or otherwise, and in addition to any affirmative vote required by law or any other provision of this Restated Certificate of Incorporation, the provisions of this Article Tenth and of Articles Fourth through Ninth hereof may not be amended or repealed in any respect, unless such action is approved by the affirmative vote of the holders of at least 80% of the voting power of the then outstanding Voting Stock, voting together as a single class [it being understood that, for purposes of this paragraph (a), each share of the Voting Stock shall have the number of votes granted to it pursuant to Article Fourth hereof]; provided, however, that the foregoing provisions of this paragraph (a) shall not be applicable to any particular proposal to amend or repeal any provision of this Restated Certificate of Incorporation, and such proposed amendment or repeal shall require only such affirmative vote as is required by law or any other provision of this Restated Certificate of Incorporation or the By-laws of the Corporation, if such proposed amendment or repeal shall have been approved by resolution of the Board of Directors adopted by the affirmative vote of at least 80% of all members thereof.

(b) Subject to paragraph (a) of this Article Tenth, the Corporation reserves the right to amend, alter, change or repeal any provision of this Restated Certificate of Incorporation, in the manner now or hereafter prescribed by the laws of the State of Delaware, and all rights and powers conferred herein upon stockholders and directors are granted subject to this reservation. All references herein to "this Restated Certificate of Incorporation" shall be deemed to encompass this Restated Certificate of Incorporation, as the same shall be amended from time to time.

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EX-15

Exhibit 15

ACKNOWLEDGEMENT OF INDEPENDENT AUDITORS

The Board of Directors
First Midwest Bancorp, Inc.:

We are aware of the incorporation by reference in the following Registration Statements of our report dated May 14, 2002 relating to the Unaudited consolidated interim financial statements of First Midwest Bancorp, Inc. that are included in its Form 10-Q for the quarter ended March 31, 2002.

• Registration Statement (Form S-3 No. 33-20439) pertaining to the First Midwest Bancorp, Inc. Dividend Reinvestment and Stock Purchase Plan

• Registration Statement (Form S-8 No. 33-25136) pertaining to the First Midwest Bancorp, Inc Savings and Profit Sharing Plan

• Registration Statement (Form S-8 No. 33-42980) pertaining to the First Midwest Bancorp, Inc. 1989 Omnibus Stock and Incentive Plan
• Registration Statement (Form S-8 No. 333-42273) pertaining to the First Midwest Bancorp, Inc. 1989 Omnibus Stock and Incentive Plan

• Registration Statement (Form S-8 No. 333-61090) pertaining to the First Midwest Bancorp, Inc. 1989 Omnibus Stock and Incentive Plan
• Registration Statement (Form S-8 No. 333-50140) pertaining to the First Midwest Bancorp, Inc. Non-employee Director Stock Option Plan

• Registration Statement (Form S-8 No. 333-63095) pertaining to the First Midwest Bancorp, Inc. Non-employee Director Stock Option Plan

• Registration Statement (Form S-8 No. 333-63097) pertaining to the First Midwest Bancorp, Inc. Nonqualified Retirement Plan

/s/ Ernst & Young, LLP

Chicago, Illinois

May 14, 2002

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EX-99

Exhibit 99

Independent Accountants' Review Report

The Board of Directors
First Midwest Bancorp, Inc.:

We have reviewed the accompanying consolidated statements of condition of First Midwest Bancorp, Inc. and subsidiaries as of March 31, 2002, and the related consolidated statements of income for the three-month period ended March 31, 2002 and 2001, and the consolidated statements of cash flows for the three-month period ended March 31, 2002 and 2001. These financial statements are the responsibility of the Company's management.

We conducted our reviews in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data, and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with auditing standards generally accepted in the United States, which will be performed for the full year with the objective of expressing an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our reviews, we are not aware of any material modifications that should be made to the accompanying consolidated financial statements referred to above for them to be in conformity with accounting principles generally accepted in the United States.

We have previously audited, in accordance with auditing standards generally accepted in the United States, the consolidated statement of condition of First Midwest Bancorp, Inc. as of December 31, 2001, and the related consolidated statements of income, shareholders' equity, and cash flows for the year then ended (not presented herein) and in our report dated January 15, 2002, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated statement of condition as of December 31, 2001, is fairly stated, in all material respects, in relation to the consolidated statement of condition from which it has been derived.

/s/ Ernst & Young, LLP

Chicago, Illinois

May 14, 2002

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