EX-99.1 2 dex991.htm PRESS RELEASE Press Release

Exhibit 99.1

 

   News Release
LOGO    First Midwest Bancorp, Inc.   

First Midwest Bancorp, Inc.

One Pierce Place, Suite 1500

Itasca, Illinois 60143

(630) 875-7450

FOR IMMEDIATE RELEASE    CONTACT:    Paul F. Clemens
         Chief Financial Officer
         (630) 875-7347
TRADED:     NASDAQ Global Select Market       www.firstmidwest.com
SYMBOL:    FMBI      

FIRST MIDWEST BANCORP, INC. ANNOUNCES 2010

SECOND QUARTER RESULTS

Increased Core Operating Performance – Improved Credit Quality – Solid Capital

Operating Performance

 

•  

Net income of $7.8 million for second quarter 2010 vs. $8.1 million for first quarter 2010 and $2.7 million for second quarter 2009.

 

•  

Pre-tax, pre-provision core operating earnings of $33.0 million for second quarter 2010, up $1.4 million, or 4.3%, from first quarter 2010 and up $1.2 million, or 3.7%, from second quarter 2009.

 

•  

Average core transactional deposits up approximately $561.0 million, or 15.0%, from second quarter 2009.

 

•  

Total loan balances remain stable with Commercial and Industrial up $39 million, or 11% annualized, from March 31, 2010.

Capital and Credit

 

•  

Tangible common equity to risk-based assets of 10.71%, up 19 basis points from first quarter 2010.

 

•  

Non-performing loans reduced by $24.1 million, or 10.8%, from March 31, 2010 and $63.4 million, or 24%, from June 30, 2009.

 

•  

Loan loss reserves to non-performing loans of 73% at June 30, 2010, compared to 65% at March 31, 2010 and 48% at June 30, 2009.

ITASCA, IL, JULY 21, 2010 – Today First Midwest Bancorp, Inc. (the “Company” or “First Midwest”) (NASDAQ NGS: FMBI), the holding company of First Midwest Bank, reported results of operations and financial condition for second quarter 2010. Net income for the quarter was $7.8 million, before adjustment for preferred dividends and non-vested restricted shares, with net income of $5.2 million, or $0.07 per share, available to common shareholders after such adjustments. This

 

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compares to net income available to common shareholders of $5.4 million, or $0.08 per share, for first quarter 2010 and net income available to common shareholders of $63,000, or $0.00 per share, for second quarter 2009.

Summary Update

In making the announcement, Michael L. Scudder, President and Chief Executive Officer of First Midwest Bancorp, Inc., said, “Performance for the quarter reflected continued success in growing our core business and ongoing efforts to improve overall credit performance. While higher credit-related costs weighed against overall earnings, our core operating performance was solid, reflecting both linked quarter and year-over-year advances. Growth in commercial lending and overall stable loan levels, as well as a notable increase in fee-based revenues from our asset management and card-based businesses, reflect a targeted investment in our sales resources and calling activity. During the quarter, we acquired Peotone Bank and Trust Company from the FDIC, adding to our existing market footprint. In what remains a difficult environment, improvement was noted in virtually every measure of asset quality, with nonperforming loans down approximately 11% from the first quarter of 2010.”

Mr. Scudder continued, “While we have seen signs of economic improvement, the pace of recovery remains slow, due to consumer and business uncertainty as well as persistent weakness in real estate. These same conditions combine to create continued challenges as the industry and the Company strive to reduce problem asset levels and remediation costs. At the same time, I firmly believe First Midwest’s core earnings strength, market presence and leading capital foundation leave us well positioned to pursue opportunities to grow our core business.”

Operating Performance

The Company generated pre-tax, pre-provision core operating earnings of $33.0 million for second quarter 2010, compared to $31.6 million for first quarter 2010 and $31.8 million for second quarter 2009. The 4% increases compared to both prior periods were the result of higher net interest income derived from higher yields on earning assets and significantly lower funding costs. These increases more than offset higher expenses incurred to remediate troubled assets. A reconciliation of earnings in accordance with U.S. generally accepted accounting principles (“GAAP”) to the non-GAAP financial measures of pre-tax, pre-provision core operating earnings is presented on page 12 of this earnings release.

Total loans as of June 30, 2010 of $5.2 billion were relatively unchanged from March 31, 2010, although commercial and industrial loans increased by 11% annualized. The year-over-year decline of

 

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$132.4 million from June 30, 2009 was due primarily to a 44% decrease in the residential and commercial construction and land loan portfolios, as the Company continued to remediate and reduce exposure to these lending categories.

Covered assets were $251.6 million at June 30, 2010, as compared to $207.6 million at March 31, 2010, and consist of loans, other real estate owned, and FDIC indemnification assets from the two FDIC-assisted acquisitions completed in October 2009 and April 2010. The quarter-over-quarter increase in covered assets is due to the acquisition of approximately $50 million of such assets from the former Peotone Bank and Trust Company on April 23, 2010, as discussed later in this release.

Average core transactional deposits for second quarter 2010 were $4.3 billion, an increase of $560 million, or 15.0%, from second quarter 2009. Excluding core transactional deposits acquired through FDIC-assisted transactions, the year-over-year increase in core transactional deposits was $470 million, or 12.6%, and reflects targeted marketing activities, higher seasonal balances maintained by municipal customers, and customers’ desires to maintain more liquid deposits.

Tax-equivalent net interest margin was 4.21% for second quarter 2010 compared to 4.28% for first quarter 2010. The decline in medium and long-term rates from the prior quarter resulted in a reduction in earning asset yields of 16 basis points, partially offsetting the decrease in cost of funds of 13 basis points. Also during the second quarter, average earning assets increased, mitigating the impact of the decline in interest rates and contributing $1.7 million to net interest income.

Tax-equivalent net interest margin improved 68 basis points to 4.21% for second quarter 2010 from 3.53% for second quarter 2009, reflecting the impact of a comparative decline in short and long-term interest rates. A $360.0 million decline in lower yielding securities, decreased reliance on higher costing wholesale funds, and improved market liquidity all contributed to the reduction in the Company’s cost of funds.

Fee-based revenues of $21.9 million for second quarter 2010 were up 9.2% from first quarter 2010, reflecting increases in all major fee categories. These revenues increased 3.1% compared to second quarter 2009 with the decline in service charge fees more than offset by a 15.1% increase in other service charges, commissions and fees (primarily merchant fee income), an 11.1% increase in card-based fees, and a 6.6% increase in trust and advisory fees.

Total noninterest income increased 12.3% from first quarter 2010 due to the bargain purchase gain stemming from the acquisition of Peotone Bank and Trust Company. Compared to second quarter 2009, total noninterest income decreased 13.0% as a result of differences in net securities gains, the fair value adjustment related to the Company’s non-qualified deferred compensation plan, in addition to the bargain purchase gain on the Peotone Bank and Trust Company transaction.

 

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Total noninterest expense for second quarter 2010 increased approximately $2.0 million from first quarter 2010, due primarily to a $1.0 million increase in losses and write downs realized on other real estate owned, as well as a normal seasonal increase in marketing expenditures.

Total noninterest expense increased 13.9% in second quarter 2010 compared to second quarter 2009, substantially due to an $8.5 million increase in losses, write downs, and operating expenses associated with other real estate owned, $841 thousand in higher loan remediation costs (including costs to convert and value loans acquired in the FDIC-assisted transactions) as well as higher marketing, merchant processing, and technology costs. Such increases were partially offset by a $3.5 million decline in FDIC insurance premiums and a $1.7 million decline in salaries and benefits expense due primarily to the reduction in compensation related to the decline in fair value of assets underlying the non-qualified deferred compensation plan.

Acquisition of Peotone Bank and Trust Company

On April 23, 2010, the Company acquired certain loans and deposits of the former Peotone Bank and Trust Company in an FDIC-assisted transaction generating a pre-tax bargain purchase gain of $4.3 million. Loans comprise the majority of the assets acquired and are subject to a loss sharing arrangement with the FDIC whereby the Company is indemnified against the majority of any losses incurred related to these loans. The loans acquired from the former Peotone Bank and Trust Company, including the FDIC indemnification asset, total $53.1 million at June 30, 2010. These assets are excluded from the asset quality presentation in this release, given the loss share indemnification from the FDIC.

Asset Quality

Non-performing loans, excluding covered loans, represented 3.84% of total loans at June 30, 2010, compared to 4.31% and 4.93% at March 31, 2010 and June 30, 2009, respectively. Loans 30-89 days delinquent stood at $32.0 million, or 0.61% of total loans, approximating the March 31, 2010 level of $28.0 million.

The reserve for loan losses represented 2.79% of total loans outstanding at June 30, 2010, unchanged from March 31, 2010 and up from 2.39% at June 30, 2009. The reserve for loan losses as a percentage of non-performing loans, excluding covered loans, improved to 73% at June 30, 2010, compared to 65% at March 31, 2010 and 48% at June 30, 2009. Charge offs, excluding covered loans, for second quarter 2010 were $20.2 million compared to $18.3 million and $27.7 million for first quarter 2010 and second quarter 2009, respectively.

 

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Other real estate owned was $57.0 million at June 30, 2010, compared to $62.6 million at March 31, 2010 and $50.6 million at June 30, 2009. The Company sold $21.6 million of OREO during second quarter 2010 at a loss of $5.5 million. OREO write-downs of $3.4 million were also recorded as the Company continues to align values with current market conditions.

Securities Portfolio

Approximately 95% of the Company’s $1.1 billion available-for-sale portfolio is comprised of municipals, collateralized mortgage obligations (“CMOs”), and agency pass-through securities. The remainder consists of trust-preferred collateralized debt obligation pools (“CDOs”) with a fair value of $13.7 million and an unrealized loss of $36.8 million, and miscellaneous other securities totaling $36.5 million. Net securities gains were $1.1 million for second quarter 2010 and were net of other-than-temporary impairment charges of $1.1 million primarily related to the Company’s CDOs.

 

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Capital Management

As reflected in the following table, all regulatory mandated ratios for characterization as “well-capitalized” were exceeded as of June 30, 2010.

 

     June 30,
2010		     March 31,
2010		     Minimum
“Well-
Capitalized”
Level		     Excess Over
Required
Minimums at
June 30, 2010
                       (Amounts in millions)

Regulatory capital ratios:

           

Total capital to risk-weighted assets

    17.31 %    17.23 %    10.00 %    73 %    $ 465

Tier 1 capital to risk-weighted assets

    15.25 %    15.17 %    6.00 %    154 %    $ 588

Tier 1 leverage to average assets

    12.69 %    13.06 %    5.00 %    154 %    $ 588

Regulatory capital ratios, excluding preferred stock:

           

Total capital to risk-weighted assets

    14.27 %    14.20 %    10.00 %    43 %    $ 272

Tier 1 capital to risk-weighted assets

    12.21 %    12.14 %    6.00 %    104 %    $ 382

Tier 1 leverage to average assets

    10.17 %    10.45 %    5.00 %    103 %    $ 382

Tier 1 common capital to risk-weighted assets

    10.88 %    10.81 %    N/A      N/A        N/A

Tangible equity ratios:

           

Tangible common equity to tangible assets

    9.05 %    9.17 %    N/A      N/A        N/A

Tangible common equity, excluding other comprehensive loss, to tangible assets

    9.22 %    9.42 %    N/A      N/A        N/A

Tangible common equity to risk-weighted assets

    10.71 %    10.52 %    N/A      N/A        N/A

The Board of Directors reviews the Company’s capital plan each quarter, giving consideration to the current and expected operating environment, as well as an evaluation of various capital alternatives.

 

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About the Company

First Midwest is the premier relationship-based banking franchise in the growing Chicagoland banking market. As one of the Chicago metropolitan area’s largest independent bank holding companies, First Midwest provides the full range of both business and retail banking and trust and investment management services through 98 offices located in 64 communities, primarily in metropolitan Chicago.

Safe Harbor Statement

This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are not historical facts but instead represent only the Company’s beliefs regarding future events, many of which, by their nature, are inherently uncertain and outside of the Company’s control. It is possible that actual results and the Company’s financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements. For a discussion of some of the risks and important factors that could affect the Company’s future results, see “Risk Factors” in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2009 and other reports filed with the Securities and Exchange Commission. Forward-looking statements represent management’s best judgment as of the date hereof based on currently available information. Except as required by law, the Company undertakes no duty to update the contents of this press release after the date hereof.

Conference Call

A conference call to discuss the Company’s results, outlook and related matters will be held on Wednesday, July 21 2010 at 10:00 A.M. (ET). Members of the public who would like to listen to the conference call should dial (866) 800-8652 (U.S. domestic) or (617) 614-2705 (international) and enter passcode number 547 12 550. The number should be dialed 10 to 15 minutes prior to the start of the conference call. There is no charge to access the call. The conference call will also be accessible as an audio webcast through the Investor Relations section of the Company’s website, www.firstmidwest.com/investorrelations. For those unable to listen to the live broadcast, a replay will be available on the Company’s website or by dialing (888) 286-8010 (U.S. domestic) or (617) 801-6888 (international) passcode number 397 65 478 beginning at 1:00 P.M. (ET) on July 21, 2010 until 11:59 P.M. (ET) on July 28, 2010. Please direct any questions regarding obtaining access to the conference call to First Midwest Bancorp, Inc. Investor Relations, via e-mail, at investor.relations@firstmidwest.com.

 

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Accompanying Financial Statements and Tables

Accompanying this press release is the following unaudited financial information:

 

•  

Operating Highlights, Balance Sheet Highlights, and Capital Ratios

 

•  

Condensed Consolidated Statements of Financial Condition

 

•  

Condensed Consolidated Statements of Income

 

•  

Pre-Tax, Pre-Provision Core Operating Earnings

 

•  

Loan Portfolio Composition

 

•  

Asset Quality

 

•  

Charge-off Data

 

•  

Securities Available-for-Sale

Press Release and Additional Information Available on Website

This press release, the accompanying financial statements and tables, and certain additional unaudited Selected Financial Information are available through the “Investor Relations” section of First Midwest’s website at www.firstmidwest.com.

 

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First Midwest Bancorp, Inc.   Press Release Dated July 21, 2010

 

Operating Highlights

Unaudited

(Dollar amounts in thousands except per share data)

 

     Quarters Ended  
     June 30,
2010		     March 31,
2010		     June 30,
2009		  

Net income

    $ 7,809      $ 8,081      $ 2,663   

Net income applicable to common shares

      5,171        5,428        63   

Diluted earnings per common share

    $ 0.07      $ 0.08      $ —     

Return on average common equity

      2.16 %      2.38 %      0.04 % 

Return on average assets

      0.40 %      0.43 %      0.13 % 

Net interest margin

      4.21 %      4.28 %      3.53 % 

Efficiency ratio

      57.92 %      58.41 %      61.45 % 

Balance Sheet Highlights

Unaudited

(Dollar amounts in thousands except per share data)

 

     As Of
     June 30,
2010		    March 31,
2010		    June 30,
2009

Total assets

    $ 7,805,089    $ 7,592,907    $ 7,767,312

Total loans, excluding covered loans

      5,208,347      5,195,874      5,340,771

Covered assets (1)

      251,572      207,609      0

Total deposits

      6,123,565      5,864,104      5,766,656

Total stockholders’ equity

      1,155,512      1,143,768      892,053

Common stockholders’ equity

      962,512      950,768      699,053

Book value per share

    $ 13.00    $ 12.84    $ 14.22

Period end shares outstanding

      74,049      74,046      49,161

 

(1)

Covered assets are subject to a loss sharing agreement with the Federal Deposit Insurance Corporation (“FDIC”) whereby the Company is indemnified against the majority of any losses incurred related to these loans and other real estate owned.

Capital Ratios

Unaudited

 

     As Of  
     June 30,
2010		     March 31,
2010		     June 30,
2009		  

Regulatory capital ratios:

       

Total capital to risk-weighted assets

    17.31 %    17.23 %    15.21 % 

Tier 1 capital to risk-weighted assets

    15.25 %    15.17 %    12.38 % 

Tier 1 leverage to average assets

    12.69 %    13.06 %    9.87 % 

Regulatory capital ratios, excluding preferred stock:

       

Total capital to risk-weighted assets

    14.27 %    14.20 %    12.17 % 

Tier 1 capital to risk-weighted assets

    12.21 %    12.14 %    9.33 % 

Tier 1 leverage to average assets

    10.17 %    10.45 %    7.44 % 

Tier 1 common capital to risk-weighted assets

    10.88 %    10.81 %    7.36 % 

Tangible common equity ratios:

       

Tangible common equity to tangible assets

    9.05 %    9.17 %    5.56 % 

Tangible common equity, excluding other comprehensive loss, to tangible assets

    9.22 %    9.42 %    6.23 % 

Tangible common equity to risk-weighted assets

    10.71 %    10.52 %    6.57 % 

 

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First Midwest Bancorp, Inc.   Press Release Dated July 21, 2010

 

Condensed Consolidated Statements of Financial Condition

Unaudited

(Amounts in thousands)

 

     June 30,  
     2010     2009  

Assets

     

Cash and due from banks

    $ 136,982      $ 132,231   

Funds sold and other short-term investments

      236,098        7,723   

Trading account securities, at fair value

      13,067        12,203   

Securities available-for-sale, at fair value

      1,090,109        1,450,082   

Securities held-to-maturity, at amortized cost

      87,843        86,245   

Federal Home Loan Bank and Federal Reserve Bank stock, at cost

      59,864        54,768   

Loans, excluding covered loans

      5,208,347        5,340,771   

Covered loans (1)

      164,924        —     

Reserve for loan losses

      (145,027 )      (127,528 ) 
                

Net loans

      5,228,244        5,213,243   
                

Other real estate owned (“OREO”), excluding covered assets

      57,023        50,640   

Covered other real estate owned (1)

      10,657        —     

FDIC indemnification asset (1)

      75,991        —     

Premises, furniture, and equipment

      132,335        115,702   

Investment in bank owned life insurance

      198,399        197,564   

Goodwill and other intangible assets

      281,255        282,592   

Accrued interest receivable and other assets

      197,222        164,319   
                

Total assets

    $ 7,805,089      $ 7,767,312   
                

Liabilities and Stockholders’ Equity

     

Deposits

     

Transactional deposits

    $ 4,218,383      $ 3,778,879   

Time deposits

      1,905,182        1,987,777   
                

Total deposits

      6,123,565        5,766,656   

Borrowed funds

      328,470        792,176   

Subordinated debt

      137,739        232,342   

Accrued interest payable and other liabilities

      59,803        84,085   
                

Total liabilities

      6,649,577        6,875,259   
                

Preferred stock

      190,553        189,921   

Common stock

      858        613   

Additional paid-in capital

      435,605        193,623   

Retained earnings

      819,890        850,950   

Accumulated other comprehensive loss

      (12,803 )      (49,482 ) 

Treasury stock, at cost

      (278,591 )      (293,572 ) 
                

Total stockholders’ equity

      1,155,512        892,053   
                

Total liabilities and stockholders’ equity

    $ 7,805,089      $ 7,767,312   
                

 

(1)

Total covered assets equal $251,572 and are comprised of covered loans, covered OREO, and an FDIC indemnification asset.

 

10

First Midwest Bancorp, Inc.   Press Release Dated July 21, 2010

 

Condensed Consolidated Statements of Income

Unaudited

(Amounts in thousands, except per share data)

 

     Quarters Ended  
     June 30,
2010		     March 31,
2010		     June 30,
2009		  

Interest Income

       

Loans

    $ 65,439      $ 64,480      $ 64,071   

Securities

      13,699        13,952        20,678   

Covered assets, excluding covered OREO

      2,598        2,962        —     

Other

      538        385        390   
                        

Total interest income

      82,274        81,779        85,139   
                        

Interest Expense

       

Deposits

      9,626        10,545        17,152   

Borrowed funds

      749        1,010        3,893   

Subordinated debt

      2,280        2,286        3,703   
                        

Total interest expense

      12,655        13,841        24,748   
                        

Net interest income

      69,619        67,938        60,391   

Provision for loan losses

      21,526        18,350        36,262   
                        

Net interest income after provision for loan losses

      48,093        49,588        24,129   
                        

Noninterest Income

       

Service charges on deposit accounts

      9,052        8,381        9,687   

Trust and investment management fees

      3,702        3,593        3,471   

Other service charges, commissions, and fees

      4,628        4,172        4,021   

Card-based fees

      4,497        3,893        4,048   
                        

Subtotal, fee-based revenues

      21,879        20,039        21,227   

Bank owned life insurance income

      349        248        1,159   

Securities gains, net

      1,121        3,057        6,635   

Gain on FDIC-assisted transaction

      4,303        —          —     

Other

      (342 )      977        2,373   
                        

Total noninterest income

      27,310        24,321        31,394   
                        

Noninterest Expense

       

Salaries and employee benefits

      26,540        26,884        28,229   

FDIC insurance

      2,546        2,532        6,034   

Net occupancy expense

      5,657        6,040        5,194   

Losses realized on other real estate owned

      8,924        7,879        2,387   

Other real estate owned expense, net

      2,926        2,908        914   

Loan remediation expense

      1,836        2,001        995   

Other professional fees

      3,816        4,539        2,730   

Other

      15,210        12,690        12,750   
                        

Total noninterest expense

      67,455        65,473        59,233   
                        

Income (loss) before taxes

      7,948        8,436        (3,710 ) 

Income tax expense (benefit)

      139        355        (6,373 ) 
                        

Net income

      7,809        8,081        2,663   

Preferred dividends

      (2,573 )      (2,572 )      (2,566 ) 

Net income applicable to non-vested restricted shares

      (65 )      (81 )      (34 ) 
                        

Net Income Applicable to Common Shares

    $ 5,171      $ 5,428      $ 63   
                        

Diluted Earnings Per Common Share

    $ 0.07      $ 0.08      $ —     

Dividends Declared Per Common Share

    $ 0.01      $ 0.01      $ 0.01   

Weighted Average Diluted Common Shares Outstanding

      73,028        70,469        48,501   

 

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First Midwest Bancorp, Inc.   Press Release Dated July 21, 2010

 

Pre-Tax, Pre-Provision Core Operating Earnings (1)

Unaudited

(Dollar amounts in thousands)

 

     Quarters Ended  
     June 30,
2010		     March 31,
2010		     June 30,
2009		  

Income (loss) before taxes

    $ 7,948      $ 8,436      $ (3,710 ) 

Provision for loan losses

      21,526        18,350        36,262   
                        

Pre-tax, pre-provision earnings

      29,474        26,786        32,552   
                        

Non-Operating Items

       

Securities gains (losses), net

      1,121        3,057        6,635   

Gains on FDIC-assisted transaction

      4,303        —          —     

Losses realized on other real estate owned

      (8,924 )      (7,879 )      (2,387 ) 

FDIC special deposit insurance assessment

      —          —          (3,500 ) 
                        

Total non-operating items

      (3,500 )      (4,822 )      748   
                        

Pre-tax, pre-provision core operating earnings

    $ 32,974      $ 31,608      $ 31,804   
                        

Risk-weighted assets

    $ 6,362,015      $ 6,381,679      $ 6,335,010   

Pre-tax, pre-provision core operating earnings to risk-weighted assets

      2.07 %      1.98 %      2.01 % 

 

(1)

The Company’s accounting and reporting policies conform to U.S. generally accepted accounting principles (“GAAP”) and general practice within the banking industry. As a supplement to GAAP, the Company has provided this non-GAAP performance result. The Company believes that this non-GAAP financial measure is useful because it allows investors to assess the Company’s operating performance. Although this non-GAAP financial measure is intended to enhance investors’ understanding of the Company’s business and performance, this non-GAAP financial measure should not be considered an alternative to GAAP.

 

12

First Midwest Bancorp, Inc.   Press Release Dated July 21, 2010

 

Loan Portfolio Composition, Excluding Covered Loans

Unaudited

(Dollar amounts in thousands)

 

     As Of    Percent Change From  
     6/30/10    % of
Total		     3/31/10    6/30/09    3/31/10     6/30/09  

Commercial and industrial

    $ 1,494,119    28.7 %    $ 1,454,714    $ 1,457,413    2.7 %    2.5 % 

Agricultural and farmland

      199,597    3.8 %      200,527      210,675    (0.5 %)    (5.3 %) 

Commercial real estate:

                

Office, retail, and industrial

      1,220,191    23.4 %      1,239,583      1,117,748    (1.6 %)    9.2 % 

Construction:

                

Residential construction and land

      241,094    4.6 %      276,322      458,913    (12.7 %)    (47.5 %) 

Commercial construction and land

      202,041    3.9 %      233,662      325,425    (13.5 %)    (37.9 %) 
                                       

Total construction

      443,135    8.5 %      509,984      784,338    (13.1 %)    (43.5 %) 
                                       

Multifamily

      369,281    7.1 %      348,178      305,976    6.1 %    20.7 % 

Investor-owned rental property

      120,436    2.3 %      121,040      132,173    (0.5 %)    (8.9 %) 

Other commercial real estate

      711,287    13.7 %      669,462      626,959    6.2 %    13.5 % 
                                       

Total commercial real estate

      2,864,330    55.0 %      2,888,247      2,967,194    (0.8 %)    (3.5 %) 
                                       

Consumer:

                

Home equity

      458,066    8.8 %      464,655      480,706    (1.4 %)    (4.7 %) 

Real estate 1-4 family

      145,457    2.8 %      139,840      171,186    4.0 %    (15.0 %) 

Other consumer

      46,778    0.9 %      47,891      53,597    (2.3 %)    (12.7 %) 
                                       

Total consumer

      650,301    12.5 %      652,386      705,489    (0.3 %)    (7.8 %) 
                                       

Total loans, excluding covered loans

    $ 5,208,347    100.0 %    $ 5,195,874    $ 5,340,771    0.2 %    (2.5 %) 
                                       

Office, Retail, and Industrial

                

Office

    $ 415,846    34.1 %    $ 396,749    $ 356,946    4.8 %    16.5 % 

Retail

      310,819    25.5 %      346,218      297,829    (10.2 %)    4.4 % 

Industrial

      493,526    40.4 %      496,616      462,973    (0.6 %)    6.6 % 
                                       

Total office, retail, and industrial

    $ 1,220,191    100.0 %    $ 1,239,583    $ 1,117,748    (1.6 %)    9.2 % 
                                       

 

13

First Midwest Bancorp, Inc.   Press Release Dated July 21, 2010

 

Asset Quality, Excluding Covered Assets

Unaudited

(Dollar amounts in thousands)

 

     As Of  
     6/30/10     % of Loan
Category		     % of Total     3/31/10     6/30/09  

Non-accrual loans:

           

Commercial and industrial

    $ 39,942      2.67 %    20.6 %    $ 38,095      $ 41,542   

Agricultural and farmland

      1,139      0.57 %    0.6 %      2,532        452   

Office, retail, and industrial

      17,170      1.41 %    8.9 %      18,204        13,058   

Residential construction and land

      71,148      29.51 %    36.7 %      93,412        143,231   

Commercial construction and land

      20,457      10.13 %    10.6 %      20,023        3,833   

Multi-family

      7,904      2.14 %    4.1 %      8,349        10,632   

Investor-owned rental property

      6,083      5.05 %    3.1 %      5,947        2,787   

Other commercial real estate

      15,867      2.23 %    8.2 %      15,859        14,642   

Consumer

      13,979      2.15 %    7.2 %      13,652        7,076   
                                    

Total non-accrual loans, excluding covered loans

      193,689      3.72 %    100.0 %      216,073        237,253   
                                    

90 days past due loans (still accruing interest):

           

Commercial and industrial

      2,209      0.15 %    35.2 %      3,938        7,174   

Agricultural and farmland

      —        0.00 %    0 %      —          1,931   

Office, retail, and industrial

      1,550      0.13 %    24.7 %      676        1,013   

Residential construction and land

      —        0 %    0 %      —          5,022   

Commercial construction and land

      —        0 %    0 %      —          881   

Multi-family

      —        0 %    0 %      368        699   

Investor-owned rental property

      116      0.10 %    1.8 %      201        592   

Other commercial real estate

      1,387      0.19 %    22.1 %      23        1,154   

Consumer

      1,018      0.16 %    16.2 %      2,789        7,605   
                                    

Total 90 days past due loans

      6,280      0.12 %    100.0 %      7,995        26,071   
                                    

Total non-performing loans, excluding covered loans

      199,969            224,068        263,324   

Restructured loans, still accruing

      9,030            5,168        18,877   

OREO, excluding covered OREO

      57,023            62,565        50,640   
                            

Total non-performing assets, excluding covered assets

    $ 266,022          $ 291,801      $ 332,841   
                            

30-89 days past due loans

    $ 32,012          $ 28,018      $ 38,128   

Reserve for loan losses and unfunded commitments

    $ 145,477          $ 144,824      $ 127,528   

Asset Quality Ratios, Excluding Covered Assets

           

Non-accrual loans to loans

      3.72 %          4.16 %      4.44 % 

Non-performing loans to loans

      3.84 %          4.31 %      4.93 % 

Non-performing assets to loans plus OREO

      5.05 %          5.55 %      6.17 % 

Reserve for loan losses to loans

      2.79 %          2.79 %      2.39 % 

Reserve for loan losses to non-accrual loans

      75 %          67 %      54 % 

Reserve for loan losses to non-performing loans

      73 %          65 %      48 % 

 

14

First Midwest Bancorp, Inc.   Press Release Dated July 21, 2010

 

Charge-off Data, Excluding Charge-offs on Covered Loans

Unaudited

(Dollar amounts in thousands)

 

     Quarters Ended  
     6/30/10     % of Loan
Category		     % of Total     3/31/10     6/30/09  

Net loans charged-off:

           

Commercial and industrial

    $ 2,679      0.18 %    13.2 %    $ 4,463      $ 7,006   

Agricultural and farmland

      546      0.27 %    2.7 %      141        —     

Office, retail, and industrial

      2,353      0.19 %    11.6 %      1,644        217   

Residential construction and land

      9,994      4.15 %    49.4 %      4,452        8,427   

Commercial construction and land

      115      0.06 %    0.6 %      270        734   

Multifamily

      485      0.13 %    2.4 %      512        1,086   

Investor-owned rental property

      982      0.82 %    4.9 %      254        12   

Other commercial real estate

      525      0.07 %    2.6 %      4,195        2,451   

Consumer

      2,543      0.39 %    12.6 %      2,403        4,802   
                                    

Total net loans charged-off, excluding covered assets

    $ 20,222      0.39 %    100.0 %    $ 18,334      $ 24,735   
                                    

Net loan charge-offs, excluding covered charge-offs to average loans, annualized:

           

Quarter-to-date

      1.56 %    —        —          1.43 %      1.85 % 

Year-to-date

      1.49 %    —        —          1.43 %      1.91 % 

 

15

First Midwest Bancorp, Inc.   Press Release Dated July 21, 2010

 

Covered Assets (1)

Unaudited

(Dollar amounts in thousands)

 

     As Of
     June 30,
2010		    March 31,
2010		    December 31,
2009

Loans

    $ 164,924    $ 144,369    $ 146,319

Other real estate owned

      10,657      8,649      8,981

FDIC indemnification asset

      75,991      54,591      67,945
                    

Total covered assets

    $ 251,572    $ 207,609    $ 223,245
                    

90 days or more past due loans

    $ 47,912    $ 52,464    $ 30,286

30-89 days past due loans

    $ 13,725    $ 10,175    $ 22,988

Net charge-offs – quarter to date

    $ 651    $ 0    $ 0

 

(1)

Covered assets are subject to a loss sharing agreement with the Federal Deposit Insurance Corporation (“FDIC”) whereby the Company is indemnified against the majority of any losses incurred related to these loans and other real estate owned.

 

16

First Midwest Bancorp, Inc.   Press Release Dated July 21, 2010

 

Securities Available-For-Sale

Unaudited

(Dollar amounts in thousands)

 

     U.S.
Treasury
and
Agency		     Collateralized
Mortgage
Obligations		     Other
Mortgage
Backed		     State
and
Municipal		     Collateralized
Debt
Obligations		     Other     Total  

As of June 30, 2010

               

Amortized cost

    $ 9,919      $ 264,240      $ 119,933      $ 622,268      $ 50,547      $ 34,966      $ 1,101,873   

Gross unrealized gains (losses):

               

Gross unrealized gains

      12        7,055        7,779        13,413        0        1,734        29,993   

Gross unrealized losses

      (1 )      (1,582 )      (19 )      (3,079 )      (36,883 )      (193 )      (41,757 ) 
                                                        

Net unrealized gains (losses)

      11        5,473        7,760        10,334        (36,883 )      1,541        (11,764 ) 
                                                        

Fair value

    $ 9,930      $ 269,713      $ 127,693      $ 632,602      $ 13,664      $ 36,507      $ 1,090,109   
                                                        

As of March 31, 2010

               

Amortized cost

    $ 755      $ 269,457      $ 181,953      $ 635,036      $ 51,596      $ 34,949      $ 1,173,746   

Gross unrealized gains (losses):

               

Gross unrealized gains

      1        8,807        8,533        8,046        —          1,177        26,564   

Gross unrealized losses

      —          (1,761 )      (29 )      (6,666 )      (39,418 )      (397 )      (48,271 ) 
                                                        

Net unrealized gains (losses)

      1        7,046        8,504        1,380        (39,418 )      780        (21,707 ) 
                                                        

Fair value

    $ 756      $ 276,503      $ 190,457      $ 636,416      $ 12,178      $ 35,729      $ 1,152,039   
                                                        

As of June 30, 2009

               

Amortized cost

    $ —        $ 382,526      $ 221,481      $ 767,856      $ 71,789      $ 59,646      $ 1,503,298   

Gross unrealized gains (losses):

               

Gross unrealized gains

      —          8,349        6,786        4,907        —          140        20,182   

Gross unrealized losses

      —          (3,456 )      (15 )      (14,778 )      (51,474 )      (3,675 )      (73,398 ) 
                                                        

Net unrealized gains (losses)

      —          4,893        6,771        (9,871 )      (51,474 )      (3,535 )      (53,216 ) 
                                                        

Fair value

    $ —        $ 387,419      $ 228,252      $ 757,985      $ 20,315      $ 56,111      $ 1,450,082   
                                                        

 

17