Mbt Financial Corp (MBTF) 8-K Earnings Release

Monroe, Mich. – MBT Financial Corp. (NASDAQ: MBTF), the parent company of Monroe Bank & Trust, reported a preliminary net profit of $4,974,000 ($0.21 per share, basic and diluted), in the third quarter of 2018, compared to a profit of $3,933,000 ($0.17 per share, basic and diluted), in the third quarter of 2017. The profit for the first nine months of 2018 was $13,821,000 ($0.60 per share, basic and diluted), compared to $10,753,000 ($0.47 per share, basic and diluted) for the first nine months of 2017. The company also announced that it will pay a quarterly dividend of $0.10 per common share on November 15, 2018 to shareholders of record as of November 8, 2018. This is an increase of $0.04 per share compared to the dividend paid in the same quarter last year.

The Net Interest Income for the third quarter of 2018 increased $986,000, or 9.6% as the net interest margin improved from 3.38% in the third quarter of 2017 to 3.62% in the third quarter of 2018. Higher interest rates and the continued shifting of assets from investment securities to loans improved the yield on earning assets while the cost of interest bearing liabilities remained low.

The Company did not record a provision for loan losses this quarter or in the third quarter of 2017. Asset quality continues to be strong, and recoveries of previously charged off loans exceeded charge offs during the third quarter of 2018. This provided sufficient growth in the Allowance for Loan Losses to maintain its adequacy even though the amount of loans increased. Total Loans increased $11.8 million, or 1.6% during the third quarter of 2018, and $57.6 million, or 8.3% so far this year. The Allowance for Loan and Lease Losses increased from $7.7 million at the end of 2017 to $8.0 million at the end of the third quarter of 2018. Due to the loan growth, the Allowance as a percent of loans decreased since the beginning of the year from 1.10% to 1.06%.

Non-interest income for the third quarter of 2018 increased $5,000, or 0.1% compared to the third quarter of 2017. Excluding gains and losses on securities and other real estate transactions in both periods, the non-interest income increased $253,000, or 6.5%. Non-interest expense increased $206,000, or 2.3%, mainly due to increases in salaries and benefits, equipment, and EFT/ATM expenses.

Total assets of the company decreased $8.3 million, or 0.6%, compared to December 31, 2017, to $1.34 billion. Capital decreased $11.3 million during the first nine months of 2018 because the payment of the special and regular dividends exceeded the net income and because the AOCL increased due to an increase in the unrealized loss on Available For Sale investment securities. The ratio of equity to assets decreased from 9.85% at the end of 2017 to 9.06% at the end of the third quarter of 2018. The Bank’s Tier 1 Leverage ratio decreased from 10.33% as of December 31, 2017 to 9.86% as of September 30, 2018.

H. Douglas Chaffin, President and CEO, commented, “We are pleased with our results for this quarter, as our loan growth reflected our service to our customers in Southeast Michigan and Northwest Ohio, and our earnings improvement provides value to our shareholders. On October 10, 2018, we announced that we signed a definitive agreement to merge with First Merchants Corporation (NASDAQ: FRME), headquartered in Muncie, Indiana. This merger will provide tremendous benefits to our customers, shareholders and communities, and we look forward to continuing the legacy of exceptional customer service, local responsiveness, and strong community engagement that has defined Monroe Bank and Trust for 160 years.”

Conference Call

MBT Financial Corp. will hold a conference call to discuss the Third Quarter 2018 results on Friday, October 26, 2018, at 10:00 a.m. Eastern Time. The call will be webcast and can be accessed at the Investor Relations/Corporate Profile page of MBT Financial Corp.’s web site www.monroe.bank. The call can also be accessed in the United States by calling toll free (877) 510-3783. The toll free number for callers in Canada is (855) 669-9657 and international callers can access the call at (412) 902-4136. A replay will be available one hour after the conclusion of the call at (877) 344-7529, Conference #10124598. The replay is available to callers from Canada at (855) 669-9658 and international callers at (412) 317-0088. The replay will be available until November 26, 2018 at 9:00 a.m. Eastern. The webcast will be archived on the Company’s web site.

About the Company:

MBT Financial Corp. (NASDAQ:MBTF), a bank holding company headquartered in Monroe, Michigan, is the parent company of Monroe Bank & Trust. Founded in 1858, Monroe Bank & Trust helps customers’ remarkable stories unfold through an uncommon, optimistic culture. As one of the largest community banks in Southeast Michigan, with over $1.3 billion in assets, this full-service bank offers a complete range of business and personal accounts, mobile and online banking, offices and ATMs across Monroe and Wayne Counties, credit and mortgage options, investment and retirement services and award-winning community outreach. The bank believes in its customers, helping them with everything from day-to-day needs to long-term goals, and is ranked fourth among all Michigan banks for total trust assets. The bank believes in its communities, supporting over 300 organizations with sponsorships and also more than 8,000 employee volunteer hours through the Monroe Bank & Trust ENLIST Volunteerism program. The bank believes in the power of knowledge, helping thousands of students and adults thrive through the Monroe Bank & Trust Financial Education program. Monroe Bank & Trust is proud to be a trusted partner to communities and clients, and an employer of choice. We are Monroe Bank & Trust, and we believe in the story of you.

For more information about Monroe Bank & Trust, visit www.monroe.bank.

Or, contact:

Julian Broggio

SVP, Director of Marketing

(734) 240-2341

julian.broggio@monroe.bank

MBT FINANCIAL CORP.

CONSOLIDATED FINANCIAL HIGHLIGHTS - UNAUDITED

	Quarterly															Year to Date
	2018			2018			2018			2017			2017
(dollars in thousands except per share data)	3rd Qtr			2nd Qtr			1st Qtr			4th Qtr			3rd Qtr			2018			2017

EARNINGS
Net interest income	$	11,217		$	10,833		$	10,536		$	10,373		$	10,231		$	32,586		$	29,690
FTE Net interest income	$	11,321		$	10,945		$	10,638		$	10,552		$	10,394		$	32,904		$	30,160
Provision for loan and lease losses	$	-		$	-		$	(100	)	$	(500	)	$	-		$	(100	)	$	(200	)
Non interest income	$	4,040		$	4,403		$	3,784		$	3,657		$	4,035		$	12,227		$	12,225
Non interest expense	$	9,156		$	9,186		$	9,792		$	9,115		$	8,950		$	28,134		$	27,020
Net income	$	4,974		$	4,945		$	3,902		$	(144	)	$	3,933		$	13,821		$	10,753
Basic earnings per share	$	0.21		$	0.22		$	0.17		$	(0.01	)	$	0.17		$	0.60		$	0.47
Diluted earnings per share	$	0.21		$	0.21		$	0.17		$	(0.01	)	$	0.17		$	0.60		$	0.47
Average shares outstanding		22,985,176			22,978,225			22,943,736			22,884,010			22,871,451			22,969,182			22,852,935
Average diluted shares outstanding		23,114,431			23,101,035			23,063,200			23,044,241			23,040,960			23,092,771			23,034,533

PERFORMANCE RATIOS
Return on average assets		1.47	%		1.52	%		1.19	%		-0.04	%		1.18	%		1.39	%		1.09	%
Return on average common equity		16.22	%		16.63	%		12.80	%		-0.42	%		11.54	%		15.21	%		10.85	%

Base Margin		3.60	%		3.57	%		3.48	%		3.37	%		3.30	%		3.55	%		3.24	%
FTE Adjustment		0.03	%		0.04	%		0.03	%		0.06	%		0.05	%		0.03	%		0.05	%
Loan Fees		-0.01	%		0.03	%		0.01	%		0.00	%		0.03	%		0.01	%		0.01	%
FTE Net Interest Margin		3.62	%		3.64	%		3.52	%		3.43	%		3.38	%		3.59	%		3.30	%

Efficiency ratio		59.09	%		61.79	%		67.41	%		62.80	%		62.52	%		62.68	%		64.33	%
Full-time equivalent employees		289			280			281			288			295			283			290

CAPITAL
Average equity to average assets		9.07	%		9.11	%		9.31	%		10.34	%		10.21	%		9.16	%		10.01	%
Book value per share	$	5.28		$	5.24		$	5.11		$	5.79		$	5.94		$	5.28		$	5.94
Cash dividend per share	$	0.10		$	0.07		$	0.66		$	0.06		$	0.06		$	0.83		$	0.86

ASSET QUALITY
Loan Charge-Offs	$	97		$	51		$	12		$	14		$	306		$	160		$	814
Loan Recoveries	$	125		$	124		$	331		$	170		$	179		$	580		$	566
Net Charge-Offs	$	(28	)	$	(73	)	$	(319	)	$	(156	)	$	127		$	(420	)	$	248

Allowance for loan and lease losses	$	7,986		$	7,958		$	7,885		$	7,666		$	8,010		$	7,986		$	8,010

Nonaccrual Loans	$	4,494		$	3,360		$	3,453		$	3,658		$	3,050		$	4,494		$	3,050
Loans 90 days past due	$	5		$	-		$	-		$	3		$	5		$	5		$	5
Restructured loans	$	6,854		$	8,211		$	8,290		$	9,625		$	9,859		$	6,854		$	9,859
Total non performing loans	$	11,353		$	11,571		$	11,743		$	13,286		$	12,914		$	11,353		$	12,914
Other real estate owned & other assets	$	1,445		$	394		$	1,229		$	1,452		$	1,686		$	1,445		$	1,686
Total non performing assets	$	12,798		$	11,965		$	12,972		$	14,738		$	14,600		$	12,798		$	14,600

Classified Loans	$	10,458		$	9,604		$	8,866		$	8,273		$	9,206		$	10,458		$	9,206
Other real estate owned & other assets	$	1,445		$	394		$	1,229		$	1,452		$	1,686		$	1,445		$	1,686
Total classified assets	$	11,903		$	9,998		$	10,095		$	9,725		$	10,892		$	11,903		$	10,892

Net loan charge-offs to average loans		-0.01	%		-0.04	%		-0.18	%		-0.09	%		0.07	%		-0.08	%		0.05	%
Allowance for loan losses to total loans		1.06	%		1.07	%		1.09	%		1.10	%		1.15	%		1.06	%		1.15	%
Non performing loans to gross loans		1.51	%		1.56	%		1.63	%		1.91	%		1.86	%		1.51	%		1.86	%
Non performing assets to total assets		0.96	%		0.91	%		0.98	%		1.09	%		1.08	%		0.96	%		1.08	%
Classified assets to total capital		8.36	%		7.17	%		7.44	%		6.64	%		7.59	%		8.36	%		7.59	%
Allowance to non performing loans		70.34	%		68.78	%		67.15	%		57.70	%		62.03	%		70.34	%		62.03	%

END OF PERIOD BALANCES
Loans and leases	$	752,895		$	741,120		$	722,640		$	695,325		$	693,866		$	752,895		$	693,866
Total earning assets	$	1,223,623		$	1,208,138		$	1,214,209		$	1,229,425		$	1,220,844		$	1,223,623		$	1,220,844
Total assets	$	1,339,122		$	1,321,885		$	1,326,056		$	1,347,420		$	1,347,352		$	1,339,122		$	1,347,352
Deposits	$	1,166,276		$	1,147,494		$	1,193,363		$	1,198,164		$	1,195,335		$	1,166,276		$	1,195,335
Interest Bearing Liabilities	$	909,545		$	892,760		$	900,120		$	898,326		$	897,408		$	909,545		$	897,408
Shareholders' equity	$	121,351		$	120,354		$	117,502		$	132,658		$	135,969		$	121,351		$	135,969
Tier 1 Capital (Bank)	$	134,354		$	131,441		$	127,783		$	138,819		$	135,470		$	134,354		$	135,470
Total Shares Outstanding		22,990,208			22,983,255			22,973,261			22,907,844			22,875,505			22,990,208			22,875,505

AVERAGE BALANCES
Loans and leases	$	750,909		$	726,746		$	705,874		$	693,586		$	686,259		$	728,010		$	671,995
Total earning assets	$	1,238,252		$	1,207,102		$	1,224,359		$	1,220,426		$	1,220,620		$	1,223,291		$	1,221,946
Total assets	$	1,341,473		$	1,308,543		$	1,327,708		$	1,324,847		$	1,324,723		$	1,325,958		$	1,323,295
Deposits	$	1,176,264		$	1,166,187		$	1,192,570		$	1,184,592		$	1,187,768		$	1,178,281		$	1,188,546
Interest Bearing Liabilities	$	908,079		$	892,433		$	898,089		$	884,979		$	895,376		$	899,570		$	905,615
Shareholders' equity	$	121,690		$	119,260		$	123,636		$	136,963		$	135,188		$	121,522		$	132,473

MBT FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED

	Quarter Ended September 30,					Nine Months Ended September 30,
Dollars in thousands (except per share data)	2018			2017		2018			2017
Interest Income
Interest and fees on loans	$	9,164		$	8,095	$	26,117		$	23,168
Interest on investment securities-
Tax-exempt		415			327		1,262			943
Taxable		2,120			2,054		6,417			6,507
Interest on balances due from banks		193			182		376			392
Total interest income		11,892			10,658		34,172			31,010

Interest Expense
Interest on deposits		456			427		1,270			1,317
Interest on borrowed funds		219			-		316			3
Total interest expense		675			427		1,586			1,320

Net Interest Income		11,217			10,231		32,586			29,690
Provision For (Recovery Of) Loan Losses		-			-		(100	)		(200	)

Net Interest Income After
Provision For (Recovery Of) Loan Losses		11,217			10,231		32,686			29,890

Other Income
Income from wealth management services		1,193			1,155		3,556			3,830
Service charges and other fees		993			1,076		2,894			3,136
Debit Card income		763			719		2,269			2,147
Net gain on sales of securities		(91	)		150		(193	)		227
Net gain (loss) on other real estate owned		-			7		536			(89	)
Origination fees on mortgage loans sold		152			87		306			261
Bank Owned Life Insurance income		350			377		1,052			1,130
Other		680			464		1,807			1,583
Total other income		4,040			4,035		12,227			12,225

Other Expenses
Salaries and employee benefits		5,381			5,313		16,714			16,020
Occupancy expense		660			694		2,001			2,124
Equipment expense		881			783		2,548			2,271
Marketing expense		389			375		1,233			961
Professional fees		550			570		1,736			1,779
EFT/ATM expense		297			256		844			763
Other real estate owned expense		25			33		61			95
FDIC deposit insurance assessment		97			107		296			321
Bonding and other insurance expense		129			120		398			367
Telephone expense		84			83		233			302
Other		663			616		2,070			2,017
Total other expenses		9,156			8,950		28,134			27,020

Profit Before Income Taxes		6,101			5,316		16,779			15,095
Income Tax Expense		1,127			1,383		2,958			4,342
Net Profit	$	4,974		$	3,933	$	13,821		$	10,753

Basic Earnings Per Common Share	$	0.21		$	0.17	$	0.60		$	0.47

Diluted Earnings Per Common Share	$	0.21		$	0.17	$	0.60		$	0.47

Dividends Declared Per Common Share	$	0.10		$	0.06	$	0.83		$	0.86

MBT FINANCIAL CORP.
CONSOLIDATED BALANCE SHEETS

	(Unaudited)
Dollars in thousands	September 30, 2018			December 31, 2017

Assets
Cash and Cash Equivalents
Cash and due from banks
Non-interest bearing	$	17,436		$	18,233
Interest bearing		20,548			34,777
Total cash and cash equivalents		37,984			53,010

Interest Bearing Time Deposits in Other Banks		11,946			15,196
Securities - Held to Maturity		31,073			37,163
Securities - Available for Sale		399,758			442,816
Equity Securities		7,403			4,148
Loans held for sale		183			346

Loans		752,712			694,979
Allowance for Loan Losses		(7,986	)		(7,666	)
Loans - Net		744,726			687,313

Accrued interest receivable and other assets		19,187			20,463
Other Real Estate Owned		997			1,412
Bank Owned Life Insurance		59,205			58,153
Premises and Equipment - Net		26,660			27,400
Total assets	$	1,339,122		$	1,347,420

Liabilities
Deposits:
Non-interest bearing	$	291,731		$	299,838
Interest-bearing		874,545			898,326
Total deposits		1,166,276			1,198,164

Federal Home Loan Bank advances		35,000			-
Accrued interest payable and other liabilities		16,495			16,598
Total liabilities		1,217,771			1,214,762

Shareholders' Equity
Common stock (no par value)		23,403			22,840
Retained Earnings		112,343			117,524
Unearned Compensation		(19	)		-
Accumulated other comprehensive loss		(14,376	)		(7,706	)
Total shareholders' equity		121,351			132,658
Total liabilities and shareholders' equity	$	1,339,122		$	1,347,420

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Mbt Financial Corp provided additional information to their SEC Filing as exhibits

Exhibit 99: Additional Exhibits

Ticker: MBTF
CIK: 1118237
Form Type: 8-K Corporate News
Accession Number: 0001437749-18-018825
Submitted to the SEC: Thu Oct 25 2018 5:02:24 PM EST
Accepted by the SEC: Thu Oct 25 2018
Period: Thursday, October 25, 2018
Industry: National Commercial Banks