Q1 2009 Earning Report of Midwest Banc Holdings, Inc.

MBHI 8-K 4/24/2009

Section 1: 8-K (FORM 8-K)

Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) April 24, 2009

MIDWEST BANC HOLDINGS, INC.
(Exact Name of Registrant as Specified in Its Charter)

Delaware 001-13735 36-3252484
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)

501 West North Avenue
Melrose Park, Illinois 60160
(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (708) 865-1053

N/A
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

Item 1.01. Entry into a Material Definitive Agreement
Item 2.04. Triggering Events that Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-
Balance Sheet Arrangement
Item 2.02. Results of Operations and Financial Condition
Item 9.01. Financial Statements and Exhibit
SIGNATURES
EX-1.1
EX-99.1

Table of Contents

Item 1.01. Entry into a Material Definitive Agreement.

Item 2.04. Triggering Events that Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet
Arrangement.
Midwest Banc Holdings, Inc. (the “Company”), has agreed with its lender to extend its short-term revolving line of credit until June 3, 2009, and
to reduce the revolving line of credit to $15 million from $25 million. The loan bears interest at prime plus 155 basis points with a floor of 4.25%.
Currently, the Company has $8.6 million outstanding on the line of credit and $55.0 million outstanding under a term note with the same lender.
These loans are secured by the stock of Midwest Bank and Trust Company. A copy of the short-term revolving line of credit documents are
attached hereto as Exhibit 1.01.
The Company is obligated to meet certain covenants under the loan agreements relating to these loans. A breach of any of these covenants
could result in a default under the loan agreements. Upon the occurrence of an event of default, all amounts outstanding under loan agreements
could become immediately due and payable and the lender could terminate all commitments to extend further credit. The lender also could, at its
option, increase the interest rate on those loans by 300 basis points. If the Company is unable to repay those amounts, the lender could proceed
against the collateral granted to it to secure the indebtedness. If the lender accelerates the repayment of borrowings, the Company may not have
sufficient assets to make the payments when due.
The Company has advised the lender that its ratio of non-performing loans to total loans was 3.5% at March 31, 2009, thereby violating one of
the covenants in the loan agreements. In addition, the Company suffered a net loss for the first quarter of 2009, thereby causing another covenant
violation.
The Company is seeking a waiver of these covenant violations. It is also negotiating with the lender for a renewal of the line of credit for a
longer period and for revisions to other terms of both loans, including the covenants. In connection therewith the Company has agreed to provide
additional information, including credit quality projections, to the lender.
As previously reported, the Company sought covenant waivers on two occasions since December 31, 2007. The lender waived a covenant
violation in the first quarter of 2008 resulting from the Company’s net loss recognized in that period. On March 4, 2009, the lender waived a
covenant violation for the third quarter of 2008 resulting from the Company’s net loss recognized in that period, contingent upon the Company
making accelerated principal payments under the aforementioned term loan agreement in the amounts and on or prior to the dates shown below:
July 1, 2009 — $5.0 million
October 1, 2009 — $5.0 million
January 4, 2010 — $5.0 million
Previously, no principal payments were due under the term loan agreement until the final maturity date of September 28, 2010. This waiver
further provides that if the Company raises $15.0 million in new capital pursuant to an offering of common or convertible preferred stock, then the
Company shall not be obligated to make any of the accelerated principal payments specified above that fall due after the date on which the
Company receives such $15.0 million in new capital until the final maturity date of September 28, 2010. The Company has the capacity to satisfy all
payment obligations outlined above.

Item 2.02. Results of Operations and Financial Condition.
On April 28, 2009, the Company announced its earnings results for the quarter ended March 31, 2009. Attached as Exhibit 99.1 is a copy of the
press release relating to the Company’s earnings results, which is incorporated herein by reference.

2

Table of Contents

Note: the information in this report provided in item 2.02 (including the exhibit) is furnished pursuant to Item 2.02 and shall not be deemed to be
“filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, or incorporated
by reference in any filing under the Securities Acto f 1933, as amended, or the Exchange, except as shall be expressly set forth by specific reference
in such a filing.

Item 9.01. Financial Statements and Exhibit.
(d) Exhibits. The following materials are filed as exhibits to this Current Report on Form 8-K:
Exhibit 1.01 Short-term revolving line of credit loan agreement.
Exhibit 99.1 Press Release.

3

Table of Contents

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 hereunto duly authorized.

Midwest Banc Holdings, Inc.

By: /s/ JoAnn Sannasardo Lilek
JoAnn Sannasardo Lilek
Executive Vice President and Chief Financial Officer

April 30, 2009

4
(Back To Top)

Section 2: EX-1.1 (EX-1.1)

Exhibit 1.1

M&I Marshall & Ilsley Bank
770 North Water Street
Milwaukee, WI 53202-3509
414 765-7700
mibank.com

April 3 2009
Ms. JoAnn S. Lilek
Executive Vice President & CFO
501 W. North Avenue
Melrose Park, IL 60160-1603

Dear Ms. Lilek:
This Letter Agreement (the “Agreement”) is made and entered into as of this 3rd day of April 2009, by and between Midwest Banc Holdings,
Inc. (the “Borrower”) and M&I Marshall & Ilsley Bank (the “Lender”).
Borrower covenants that so long as any obligation is owed to Lender or Lender has any outstanding commitment to lend to Borrower, under the
terms and conditions of any promissory note from Borrower to Lender under the Revolving Loan(s), in the aggregate principal amount of
$15,000,000.00 (the “Revolving Credit Limit”) dated April 3, 2009, a promissory note from Borrower to Lender under the Term Loan #1, in the
aggregate principal amount of $55,000,000.00 dated March 31, 2008, a promissory note from Borrower to Lender under the Term Loan #2 (a
“Subordinated Term Note”), in the aggregate principal amount of $15,000,000.00 dated March 31, 2008; or under any note(s) evidencing a loan,
(the “Note(s)”) and all extensions, renewals or modifications of the Note(s), and any other obligation of Borrower to Lender, including but not
limited to all obligations, indebtedness and liabilities arising pursuant to or in connection with any interest rate swap transaction, basis swap,
forward rate transaction, interest rate option, price risk hedging transaction or any similar transaction between the Borrower and Lender
(collectively, the foregoing obligations are referred to herein as the “Obligations”):
1. Lender shall have received the following security documents (the “Security Documents”) in form and substance satisfactory to Lender:
(i) Promissory Note(s);
(ii) Commercial Pledge Agreement;
(iii) 100% of Midwest Bank and Trust Company stock; and
(iv) Irrevocable Stock or Bond Power.
(Subsections (ii), (iii) and (iv) above shall not apply to the Term Loan #2
(a “Subordinated Term Note”.)

2. Borrower and/or Midwest Bank and Trust Company (the “Bank”) shall furnish to Lender, as soon as available, such financing information
respecting Borrower and/or Bank as Lender from time to time requests, and without request furnish to Lender:
(i) Within 120 days after the end of each fiscal year of Borrower, a balance sheet of Borrower as of the close of such fiscal year and
related statements of income and retained earnings and cash flow for such year all in reasonable detail and satisfactory in scope to
Lender, prepared in accordance with generally accepted accounting principles applied on a consistent basis, audited by an
independent certified public accountant, selected by Borrower and acceptable to Lender.
(ii) Within 45 days after the end of each quarter, a balance sheet of Borrower as of the end of such quarter and related statements of
income and retained earnings and cash flow for the period from the beginning of the fiscal year to the end of such quarter, prepared in
accordance with generally accepted accounting principles applied on a consistent basis, subject to normal year-end adjustments,
certified by a financial representative of Borrower.
(iii) Copies of all quarterly Federal Financial Institution Examination Council Form 031 (“Call Reports”) required by Midwest Bank and
Trust Company (the “Bank”) no later than the due date required by these agencies prepared in accordance with agency requirements,
certified by the financial representatives of Bank now owned or hereafter acquired.
(iv) Within 45 days after the end of each third month, grid price monitoring will be required.
3. Borrower and/or Bank shall timely perform and observe the following financial covenant(s), all calculated in accordance with generally
accepted accounting principles applied on a consistent basis. A financial covenant violation will be an indication of an adverse change to
the Borrower’s financial condition:
(i) Bank shall maintain at all times a ratio of Non-performing Loans to Total Loans of not greater than 3.00%, tested quarterly. “Non-
performing Loans” means loans outstanding which are not accruing interest, have been classified as renegotiated pursuant to
guidelines established by the Federal Financial Institutions Examination council or are 90 days or more past due in the payment of
principal or interest. “Total Loans” means the sum of loans and direct lease financings, net of unearned income by Bank.

(ii) Bank must report a quarterly profit, tested quarterly, excluding charges related to acquisitions.
(iii) Bank must remain well capitalized, tested quarterly.
4. Borrower and/or Bank shall not merge into or consolidate with any other business enterprise or another business enterprise shall not
merge into the Borrower and/or Bank, without prior written consent of Lender. For the mergers where the Borrower is the “surviving”
entity, approval by the Lender shall be obtained following the announcement of a definitive agreement.
5. An event of default will occur if either the Borrower or Bank becomes subject to an adverse regulatory action (including a Memorandum
of Understanding which limits in any way the ability of the bank to pay dividends to the holding company, a written agreement or Cease
& Desist order).
6. Use of the Revolving Loan(s) for the purpose of acquisitions must be approved by Lender following the announcement of a definitive
agreement.
7. All outstanding debt is due on the sale of Bank or Borrower or of substantially all of the assets of either.
8. In the event of a change in executive management, Borrower shall provide Lender with an acceptable succession plan within 90 days.
9. Other Borrower debt greater than $2,000,000 is prohibited without prior written consent of Lender; excluding Trust Preferred
indebtedness, which approval will not be unreasonably withheld.
10. Borrower may at its option, at any time, prepay Term Loan #1, in part; provided, however, that the Borrower may not prepay Term Loan #1
in its entirety, so long as any portion of Term Loan #2 (a “Subordinated Term Note”) remains outstanding, unless Term Loan #1 has been
accelerated by the Lender.
11. It shall be considered an additional event of default if Borrower becomes the subject of any bankruptcy, or receivership proceedings
(voluntary or involuntary). Upon the occurrence of any bankruptcy or receivership proceedings, Lender at its option, will accelerate the
maturity of Term Loan #2 (a “Subordinated Term Note”) to five years from the original funding or the entire amount owed will then be due.
12. All credit is cross-collateralized and cross-defaulted, without limitation, all debts, obligations and liabilities to Lender arising out of credit
previously granted, credit contemporaneously granted, and credit granted in the future by Lender to

Borrower. This covenant shall not apply to Term Loan #2 (a “Subordinated Term Note”).
13. This Letter Agreement amends and restates in its entirety an existing Letter Agreement dated April 4, 2008 by and between Borrower and
Lender.
A breach of any term or condition in this Agreement or Obligations shall constitute an additional event of default under the Note(s) and Lender
may, at its option, declare the Note(s) due and payable, and may pursue all remedies available to it with regard to the Note(s). The undersigned
shall reimburse Lender for all expenses incurred by it in protecting or enforcing its rights under this Note(s), including without limitation, costs of
administration of the Note(s) and costs of collection before and after judgment, including reasonable attorney’s fees and legal expenses. There will
be a 10 day cure period for payment defaults and a 30 day cure period for covenant defaults. Any cure period shall begin on the date of receipt of
notice thereof. This applies to the line of credit and term loan reference herein.
In the case of any ambiguity or conflict between this Agreement, any note evidencing a Loan, or any Security Document, this Agreement will
govern.
Please confirm your acknowledgment and acceptance of the terms and conditions of this Agreement by signing and dating below.

Very truly yours, Very truly yours,

By: By:
David R. Ball, Senior Vice President Title:

Accepted and Agreed as of April 3, 2009

By: /s/ JoAnn S. Lilek
JoAnn S. Lilek, Executive VP/CFO

PROMISSORY NOTE

Principal Loan Date Maturity Loan No Call / Coll Account Officer Initials
$15,000,000.00 04-03-2009 06-03-2009 37956985-10000 / 00005106953 06564
References in the boxes above are for Lender’s use only and do not limit the applicability of this document to any particular loan or item.
Any item above containing “***” has been omitted due to text length limitations.

Borrower: Midwest Bank Holdings, Inc. Lender: M&I Marshall & Ilsley Bank
501 W North Ave Correspondent Banking
Melrose Park, IL 60160-1603 770 N. Water Street
Milwaukee, WI 53202

Principal Amount: $15,000,000.00 Date of Note: April 3, 2009
PROMISE TO PAY. Midwest Banc Holdings, Inc, (“Borrower”) promises to pay to M&I Marshall & Ilsley Bank (“Lender”), or order, in lawful
money of the United State of America, the principal amount of Fifteen Million & 00/100 Dollars ($15,000,000.00) or so much as may be outstanding,
together with interest on the unpaid outstanding principal balance of each advance. Interest shall be calculated from the date of each advance until
repayment of each advance.
PAYMENT. Borrower will pay this loan in one payment of all outstanding principal plus all accrued unpaid interest on June 3, 2009. In addition,
Borrower will pay regular monthly payments of all accrued unpaid interest due as of each payment date, beginning May 3, 2009, with all
subsequent interest payments to be due on the same day of each month after that. Unless otherwise agreed or required by applicable law,
payments will be applied to Accrued Interest, Principal, Late Charges, and Escrow. Borrower will pay Lender at Lender’s address shown above or
at such other place as Lender may designate in writing.
VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from time to time based on changes in an index which is the One
Month British Bankers Association (BBA) LIBOR as reported by a major news service selected by Lender (such as Reuters, Bloomberg or
Moneyline Telerate) (the “Index”). The Index is not necessarily the lowest rate charged by Lender on its loans and is set by Lender at its sole
discretion. If the index becomes unavailable during the term of this loan, Lender may designate a substitute Index after notifying Borrower, Lender
will tell Borrower the current index rate upon Borrower’s request. The interest rate change will not occur more often than each 1st day of each
calendar month and as defined in Exhibit — “Applicable Margin”. Borrower understands that Lender may make loans based on other rates as well.
The index currently is 0.495% per annum. The interest rate to be applied to the unpaid principal balance of this Note will be calculated as described
in the “INTEREST CALCULATION METHOD” paragraph using a rate of 1.550 percentage points over the Index, adjusted if necessary for any
minimum and maximum rate limitations described below, resulting in an initial rate of 4.250% per annum based on a year of 360 days. NOTICE.
Under no circumstances will the interest rate on this Note be less than 4.250% per annum or more than the maximum rate allowed by applicable law.
INTEREST CALCULATION METHOD. Interest on this Note is computed on a 365/360 basis; that is, by applying the ratio of the interest rate over
a year of 360 days, multiplied by the outstanding principal balance, multiplied by the actual number of days the principal balance is outstanding.
All interest payable under this Note is computed using this method. This calculation method results in a higher effective interest rate than the
numeric interest rate stated in this Note.
PREPAYMENT. Borrower may pay without penalty all or a portion of the amount owed earlier than it is due. Early payments will not, unless agreed
to by Lender in writing, relieve Borrower of Borrower’s obligation to continue to make payments of accrued unpaid interest. Rather, early payments
will reduce the principal balance due. Borrower agrees not to send Lender payments marked “paid in full”, “without recourse”, or similar language.
If Borrower sends such a payment, Lender may accept it without losing any of Lender’s rights under this Note, and Borrower will remain obligated
to pay any further amount owed to Lender. All written communications concerning disputed amounts, including any check or other payment
instrument that indicates that the payment constitutes “payment in full” of the amount owed or that is tendered with other conditions or limitations
or as full satisfaction of a disputed amount must be mailed or delivered to M&I Marshall & Ilsley Bank, P.O. 3114 Milwaukee, WI 53201-3114.
LATE CHARGE. If a payment is not made on or before the 10th day after its due date, Borrower will be charged 5.000% or the unpaid portion of
the regularly scheduled payment.
INTEREST AFTER DEFAULT. Upon default, including failure to pay upon final maturity, the interest rate on this Note shall be increased by
adding a 3.000 percentage point margin (“Default Rate Margin”). The Default Rate Margin shall also apply to each succeeding interest rate change
that would have applied had there been no default. However, in no event will the interest rate exceed the maximum interest rate limitations under
applicable law.

DEFAULT. Each of the following shall constitute an event of default (“Event of Default “) under this Note:
Payment Default. Borrower fails to make any payment when due under this Note.
Other Defaults. Borrower fails to comply with or to perform any other term, obligation, covenant or condition contained in this Note or in any
of the related documents or to comply with or to perform any term, obligation, covenant or condition contained in any other agreement between
Lender and Borrower.
Default in Favor of Third Parties. Borrower or any Grantor defaults under any loan, extension of credit, security agreement, purchase or sales
agreement, or any other agreement, in favor of any other creditor or person that may materially affect any of Borrower’s property or Borrower’s
ability to repay this Note or perform Borrower’s obligations under this Note or any of the related documents.
False Statements. Any warranty, representation or statement made or furnished to Lender by Borrower or on Borrower’s behalf under this Note
or the related documents is false or misleading in any material respect, either now or at the time made or furnished or becomes false or
misleading at any time thereafter.
Insolvency. The dissolution or termination of Borrower’s existence as a going business, the insolvency of Borrower, the appointment of a
receiver for any part of Borrower’s property, any assignment for the benefit of creditors, any type of creditor workout, or the commencement of
any proceeding under any bankruptcy or insolvency laws by or against Borrower.
Creditor or Forfeiture Proceedings. Commencement foreclosure or forfeiture proceedings, whether by judicial proceeding, self-help,
repossession or any other method, by any creditor of Borrower or by any governmental agency against any collateral securing the loan. This
includes a garnishment of any of Borrower’s accounts, including deposit accounts, with Lender. However, this Event of Default shall not apply
if there is a good faith dispute by Borrower as to the validity or reasonableness of the claim which is the basis of the creditor or forfeiture
proceeding and if Borrower gives Lender written notice of the creditor or forfeiture proceeding and deposits with Lender monies or a surety
bond for the creditor or forfeiture proceeding, in an amount determined by Lender, in its sole discretion, as being an adequate reserve or bond
for the dispute.
Events Affecting Guarantor. Any of the preceding events occurs with respect to any guarantor, endorser, surety, or accommodation party of
any of the indebtedness or any guarantor, endorser, surety, or accommodation party dies or becomes incompetent, or revokes or disputes the
validity of, or liability under, any guaranty of the indebtedness evidenced by this Note.
Change in Ownership. Any change in ownership of twenty-five percent (25%) or more of the common stock of Borrower.
Adverse Change. A material adverse change occurs in Borrower’s financial condition, or Lender believes the prospect of payment or
performance of this Note is impaired.
Insecurity. Lender in good faith believes itself insecure.
LENDER’S RIGHTS. Upon default, Lender may declare the entire unpaid principal balance under this Note and all accrued unpaid interest
immediately due, and then Borrower will pay that amount.
ATTORNEYS’ FEES EXPENSES. Lender may hire or pay someone else to help collect this Note if Borrower does not pay. Borrower will pay
Lender that amount. This includes, subject to any limits under applicable law, Lender’s attorneys’ fees and Lender’s legal expenses, whether or not
there is a lawsuit, including attorneys’ fees, expenses for bankruptcy proceedings (including efforts to modify or vacate any

automatic stay or injunction), and appeals. If not prohibited by applicable law, Borrower also will pay any court costs, in addition to all other sums
provided by law.
JURY WAIVER. Lender and Borrower hereby waive the right to any jury trial in any action, proceeding, or counterclaim brought by either Lender
or Borrower against the other.
GOVERNING LAW. This Note will be governed by federal law applicable to Lender and, to the extent not preempted by federal law, the laws of
the State of Wisconsin without regard to its conflicts of law provisions. This Note has been accepted by Lender in the State of Wisconsin.
CHOICE OF VENUE. If there is a lawsuit, Borrower agrees upon Lender’s request to submit to the jurisdiction of the courts of Milwaukee County,
State of Wisconsin.
DISHONORED ITEM FEE. Borrower will pay a fee to Lender of $15.00 if Borrower makes a payment on Borrower’s loan and the check or
preauthorized charge with which Borrower pays is later dishonored.
RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a right of setoff in all Borrower’s accounts with Lender (whether
checking, savings, or some other account). This includes all accounts Borrower holds jointly with someone else and all accounts Borrower may
open in the future. However, this does not include any IRA or Keogh accounts, or any trust accounts for which setoff would be prohibited by law.
Borrower authorizes Lender, to extent permitted by applicable law, to charge or setoff all sums owing on the debt against any and all such
accounts, and, at Lender’s option, to administratively freeze all such accounts to allow Lender to protect Lender’s charge and setoff rights
provided in this paragraph.
LINE OF CREDIT. This Note evidences a revolving line of credit. Advances under this Note, as well as directions for payment from Borrower’s
accounts, may be requested orally or in writing by Borrower or by an authorized person. Lender may, but need not, require that all oral requests be
confirmed in writing. Borrower agrees to be liable for all sums either: (A) advanced in accordance with the instructions of an authorized person or
(B) credited to any of Borrower’s accounts with Lender. The unpaid principal balance owing on this Note at any time may be evidenced by
endorsements on this Note or by Lender’s internal records, including daily computer print-outs. Lender will have no obligation to advance funds
under this Note if: (A) Borrower or any guarantor is in default under the terms of this Note or any agreement that Borrower or any guarantor has
with Lender, including any agreement made in connection with the signing of this Note; (B) Borrower or any guarantor ceases doing business or is
insolvent; (C) any guarantor seeks, claims or otherwise attempts to limit, modify or revoke such guarantor’s guarantee of this Note or any other
loan with Lender; (D) Borrower has applied funds provided pursuant to this Note for purposes other than those authorized by Lender; or
(E) Lender in good faith believes itself insecure.
HEDGING INSTRUMENTS. Obligations and indebtedness includes, without limitation all obligations, indebtedness and liabilities arising pursuant
to or in connection with any interest rate swap transaction, basis swap, forward rate transaction, interest rate option, price risk hedging transaction
or any similar transaction between the Borrower and Lender.
APPLICABLE MARGIN. An exhibit, titled “Applicable Margin,” is attached to this Note and by this reference is made a part of this Note just as if
all the provisions, terms and conditions of the Exhibit had been fully set forth in this Note.
PRIOR NOTE. This Promissory Note provides for the renewal or refinance of the existing debt evidenced by the Promissory Note dated March 24,
2006, in the original principal amount of $50,000,000.00 as may have been modified, extended or amended. This Note is not intended to satisfy or
extinguish the underlying debt and obligation evidenced by the March 24, 2006 Promissory Note, but rather set forth the terms and conditions on
which such debt is being renewed or refinanced.

SUCCESSOR INTERESTS. The terms of this Note shall be binding upon Borrower, and upon Borrower’s heirs, personal representatives,
successors and assigns and shall inure to the benefit of Lender and its successors and assigns.
GENERAL PROVISIONS. This Note benefits Lender and its successors and assigns, and binds Borrower and Borrower’s heirs, successors,
assigns, and representatives. If any part of this Note cannot be enforced, this fact will not affect the rest of the Note. Lender may delay or forgo
enforcing any of its rights or remedies under this Note without losing them. Borrower and any other person who signs, guarantees or endorses
this Note, to the extent allowed by law, waive presentment, demand for payment, and notice of dishonor. Upon any change in the terms of this
Note, and unless otherwise expressly stated in writing, no party who signs this Note, whether as maker, guarantor, accommodation maker or
endorser, shall be released from liability. All such parties agree that Lender may renew or extend (repeatedly and for any length of time) this loan or
release any party or guarantor or collateral; or impair, fail to realize upon or perfect Lender’s security interest in the collateral; and take any other
action deemed necessary by Lender without the consent of or notice to anyone. All such parties also agree that Lender may modify this loan
without the consent of or notice to anyone other than the party with whom the modification in made. The obligations under this Note are joint and
several.

PROMISSORY NOTE
Loan No: 37956985-10000- (Continued) Page 3

PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS NOTE, INCLUDING THE
VARIABLE INTEREST RATE PROVISIONS, BORROWER AGREES TO THE TERMS OF THE NOTE.

BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY NOTE.
BORROWER:


JoAnn S. Lilek, Executive V. P. & CFO of Midwest
Banc Holdings, Inc.

APPLICABLE MARGIN

Principal Loan Date Maturity Loan No Call / Coll Account Officer
$15,000,000.00 04-03-2009 06-03-2009 37956985-10000 / 00005106953 06564 Initials

References in the boxes above, are for Lander’s use only and do not limit the applicability of this document to any particular loan or item.

Borrower: Midwest Banc Holdings, Inc. Lender: M&I Marshall & Ilsley Bank
Melrose Park, II 60160-1603 770 N. Water Street
Milwaukee, WI 53202

This APPLICABLE MARGIN is attached to and by this reference is made a part of the Promissory Note, dated April 3, 2009, and executed in
connection with a loan or other financial accommodations between M&I MARSHALL & ILSLEY BANK and Midwest Banc Holdings, Inc.

Initial pricing will be Libor + 155 bp. Pricing will be subject to a performance-based grid below.

Company is profitable for two consecutive quarters Libor + 155bp
ROA> .50% - 1.03% for two consecutive quarters Libor + 140bp
ROA> 1.04% for two consecutive quarters Libor + 125bp

* ROA to exclude restructuring charges associated with merger and acquisition activity.

THIS APPLICABLE MARGIN IS EXECUTED ON APRIL 3, 2009.
BORROWER:


Banc Holdings, Inc.

DISBURSEMENT REQUEST AND AUTHORIZATION

Principal Loan Date Maturity Loan No Call / Coll Account Officer
$15,000,000.00 04-03-2009 06-03-2009 37956985-10000 / 00005106953 06564 Initials

References in the boxes above are for Lender’s use only and do not limit the applicability of this document to any particular loan or item.

Borrower: Midwest Banc Holdings, Inc. Lender: M&I Marshall & Ilsley Bank
Melrose Park, IL. 60160-1603 770 N. Water Street
Milwaukee, WI 53202

LOAN TYPE. This is a Variable Rate Nondisclosable Revolving Line of Credit Loan to a Corporation for $15,000,000.00 due on June 3, 2009. This is
a secured renewal of the following described indebtedness: This Promissory Note provides for the renewal or refinance of the existing debt
evidenced by the Promissory Note, dated March 24, 2006. In the original principal amount of $50,000,000.00, as may have been modified, extended
or amended. This Note is not intended to satisfy or extinguish the underlying debt and obligation evidenced by the March 24, 2006 Promissory
Note, but rather set forth the terms and conditions on which such debt is being renewed or referenced.

PRIMARY PURPOSE OF LOAN. The primary purpose of this loan is for:
o Personal, Family or Household purposes or Personal Investment.
o Agricultural Purposes.
þ Business Purposes.

SPECIFIC PURPOSE. The specific purpose of this loan is: working capital.

DISBURSEMENT INSTRUCTIONS. Borrower understands that no loan proceeds will be disbursed until all of Lender’s conditions for making the
loan have been satisfied. Please disburse the loan proceeds of $15,000,000.00 as follows:

Undishursed Funds: $15,000,000.00
Note Principal: $15,000,000.00

CHARGES PAID IN CASH. Borrower has paid or will pay in cash as agreed the following charges:

Prepaid Finance Charges Paid in Cash: $ 0.00
Other Charges Paid in Cash:
$20.00 Lien Search $20.00

Total Charges Paid in Cash: $20.00

JOINT CREDIT INTENT. If the application was for joint credit, all persons signing below confirm that their intent at time of application was to
apply for joint credit.
INSTRUCTIONS TO BANKER.
1) Please put an “X” next to the fees listed above that RCC is to pay.
2) Please complete the following section as applicable:
a) Bank deposited fees into account number:
Total dollar amount deposited into this account: $
b) Bank deposited fees into customer related:
Total dollar amount deposited into this account: $

IF BORROWER IS AN ORGANIZATION: If Organization has used any other name, OR if Organization was a successor by merger, consolidation,
acquisition or otherwise during the past 5 years, list name(s) below:

.
FINANCIAL CONDITION. BY SIGNING THIS AUTHORIZATION, BORROWER REPRESENTS AND WARRANTS TO LENDER THAT THE
INFORMATION PROVIDED ABOVE IS TRUE AND CORRECT AND THAT THERE HAS BEEN NO MATERIAL ADVERSE CHANGE IN

BORROWER’S FINANCIAL CONDITION AS DISCLOSED IN BORROWER’S MOST RECENT FINANCIAL STATEMENT TO LENDER. THIS
AUTHORIZATION IS DATED APRIL 3, 2009.

DISBURSEMENT REQUEST AND AUTHORIZATION
Loan No: 37956985-10000- (Continued) Page 2

BORROWER:


Banc Holdings, Inc.

(Back To Top)

Section 3: EX-99.1 (EX-99.1)

Exhibit 99.1

Midwest Banc Holdings, Inc. Reports Q1 Results

MELROSE PARK, Ill. — April 28, 2009 — Midwest Banc Holdings, Inc. (NASDAQ:MBHI) today reported a net loss per common share
of $(0.27), for the first quarter ended March 31, 2009. This compares to earnings per share of $0.12 in the fourth quarter of 2008 and a
net loss per share of $(0.22) for the first quarter of 2008.

Overview

“Throughout our 50 years of service to the Chicago area market, Midwest has remained committed to its customers and the
community,” stated Jay Fritz, CEO of Midwest. “We continue to successfully serve our customers and, in fact, grew loans over
$80 million in the first quarter lending to credit-worthy individuals and businesses. This continued lending is important to our customers
because it helps them manage in this very challenging environment and, in turn, will bolster the overall economy.”

“That being said, we are closely monitoring our portfolio in this difficult market,” he continued. “We are committed to safety and
soundness and focused on increasing shareholder value. Our bank is well-capitalized with a 10.51 percent total risk based capital ratio.
We are currently taking measured steps to reduce expenses and control growth to preserve capital. However, we remain committed to
servicing our customers and will continue to aggressively seek new business relationships that satisfy our underwriting criteria.”

Key Developments
• In January 2009, Jay Fritz, formerly the chief operating officer was appointed president and chief executive officer. Fritz moved into
this position without any salary or other benefit increase;

• The chief executive officer and all executive vice presidents as a group (15 people – the “executive officers”) did not receive bonuses,
whether in the form of cash, restricted stock or options for 2008;

• Net interest income increased by $1.3 million compared to the fourth quarter due to loan growth, improved net interest margin and
the continued inclusion of interest rate floors in loan pricing;

• Recorded $13.0 million provision for loan losses increasing the allowance for loan losses to $53.0 million or 2.0 percent of loans;

• Nonaccrual loans increased $19.2 million to $80.3 million or 3.1 percent of loans;

• Non-interest expense decreased $3.9 million compared to the fourth quarter, due largely to a reduction in compensation and benefits
expense and professional fees;
• Loans increased $81.3 million compared to the fourth quarter reflecting high quality marketplace opportunities which Midwest will
continue to moderate through pricing discipline;
• Strong sales efforts have produced increased average core deposits of $14.4 million compared to the fourth quarter;

• A successful retail CD campaign produced over $100 million of new deposits;
• Average brokered CDs decreased $49.4 million compared to the fourth quarter;
• Midwest renewed for 60 days a line credit for $15.0 million with its correspondent bank, of which $8.6 million is currently
outstanding; and

• As a result of economic conditions leading to an increase in nonaccrual loans and provisions for loan losses, Midwest as of
March 31, 2009 was in violation of two covenants contained in the loan agreement with its correspondent bank, for which Midwest is
currently seeking covenant waivers.

Compliance with TARP

Midwest took several steps with regard to executive compensation and prudent lending practices:
• The executive officers covered by the Treasury regulations amended their compensation arrangements with Midwest prior to the
receipt of the Dec. 2008 TARP investment to ensure that the arrangements complied with the Capital Purchase Program executive
compensation rules.

• In a manner consistent with prudent lending practices, Midwest has grown the loan portfolio $81 million from Dec. 31, 2008 to
March 31, 2009.
• During the first quarter Midwest also renewed $208 million of loans.

Capital

At March 31, 2009 Midwest Bank’s total risk based capital ratio was 10.51 percent and the Bank’s tier 1 risk based capital ratio was
7.52 percent. All of the Bank’s capital ratios exceed the regulatory guidelines for classification as “well-capitalized,” which is the
highest regulatory capital rating given to financial institutions.

Loan Portfolio & Asset Quality

From Dec. 31, 2008 to March 31, 2009 Midwest grew loans $81.3 million. Loan growth in the first quarter was facilitated by the new
capital raised in December under the TARP program. Average total loans increased $44.0 million during the first quarter.

In the first quarter, Midwest recorded a provision for loan losses of $13.0 million and recognized net loan charge-offs totaling
$4.4 million.
Loan Portfolio
As of March 31, 2009
(dollars in
millions)

Total Total Percent
Balance Availability Commitment Availability
Loan Type - Source of Repayment
Land $ 98.4 $ 1.0 $ 99.4 1.0 percent
Land Development, Residential 30.9 1.7 32.6 5.2
Land Development, Commercial 23.0 5.9 28.9 20.4
Land Development, Teardown 8.2 0.5 8.7 5.7
Condominium 68.1 14.2 82.3 17.3
Residential Construction 87.9 7.5 95.4 7.9
Commercial Construction 45.1 3.1 48.2 6.4
Residential Non-Builder 9.6 1.0 10.6 9.4
Buy Farmland 1.8 — 1.8 —
Letters of Credit — 0.2 0.2 100.0
Other 0.1 — 0.1 —
Total Const. & Land Development 373.1 35.1 408.2 8.6

1-4 Residential 68.5 — 68.5 —
1-4 ARM 50.7 0.1 50.8 0.2
Total Residential 119.2 0.1 119.3 0.1

Home Equity Fixed 17.1 0.7 17.8 3.9
Home Equity Floating 196.3 118.6 314.9 37.7
Total Home Equity 213.4 119.3 332.7 35.9

CRE — Non-Owner Occupied 764.5 36.7 801.2 4.6
CRE — Owner Occupied 563.2 46.6 609.8 7.6
Total CRE 1,327.7 83.3 1,411.0 5.9

Commercial & Industrial 538.1 348.8 886.9 39.3

Agricultural 9.2 0.9 10.1 8.9

Consumer 6.4 2.3 8.7 26.4

Overdrafts, Settlement, Miscellaneous 3.9 — — —

Total Portfolio $2,591.0 $ 589.8 $ 3,176.9 18.6 percent

• Total construction and land loan commitments are 91 percent funded.

• Land loans represent 3.8 percent of the loan portfolio.
Loan Quality
(dollars in millions)

As of March 31, 2009
30 - 89 Days Nonaccrual 2009
Past Due Loans Specifically Amount ($)
Loan Type Balance $ Percent $ Percent Reserved Charged-off
Land $ 98.4 $ 0.6 0.6 percent $ 5.0 5.1 percent $ 0.1 $ —
Land Development, Residential 30.9 0.2 0.6 0.6 1.9 — —
Land Development, Commercial 23.0 — — 0.6 2.6 — —
Land Development, Teardown 8.2 — — — — — —
Condominium 68.1 — — 9.8 14.4 0.9 —
Residential Construction 87.9 4.8 5.5 5.8 6.6 0.1 0.2
Commercial Construction 45.1 — — 3.5 7.8 — —
Residential Non-Builder 9.6 3.3 34.4 1.0 10.4 0.1 —
Buy Farmland 1.8 — — — — — —
Other 0.1 — — — — — —
Total Const. & Land Development 373.1 8.9 2.4 26.3 7.0 1.2 0.2

1-4 Residential 68.5 1.0 1.5 1.6 2.3 0.2 —
1-4 ARM 50.7 2.9 5.7 3.3 6.5 0.1 —
Total Residential 119.2 3.9 3.3 4.9 4.1 0.3 —

Home Equity Fixed 17.1 — — — — — —
Home Equity Floating 196.3 3.1 1.6 1.7 0.9 0.2 —
Total Home Equity 213.4 3.1 1.5 1.7 0.8 0.2 —

CRE — Non-Owner Occupied 764.5 14.6 1.9 12.1 1.6 1.3 —
CRE — Owner Occupied 563.2 3.6 0.6 19.1 3.4 1.8 —
Total CRE 1,327.7 18.2 1.4 31.2 2.3 3.1 —

Commercial & Industrial 538.1 4.0 0.7 16.2 3.0 6.8 4.5

Agricultural 9.2 — — — — — —

Consumer 6.4 0.1 1.6 — — — —

Overdrafts, Settlement,
Miscellaneous 3.9 — — — — — 0.1

Total Portfolio $2,591.0 $ 38.2 1.5 percent $ 80.3 3.1 percent $ 11.6 $ 4.8

During the first quarter Midwest completed a thorough review of the loan portfolio. The C&I portfolio experienced the most duress in the
first quarter; $12.6 million moved to non-accrual status, mostly due to the following three credits:
• The largest, a $6.5 million loan to a company that markets to realtors, has been negatively affected by the real estate
downturn.

• A $2.8 million loan relationship with an energy company. The borrower is currently operating under a forbearance agreement.

• A $2.8 million loan relationship with a full-service tradeshow display company in which the recent death of the principal caused
business problems. The borrower is currently operating under a forbearance agreement

Liquidity

Midwest expanded its effective liquidity management during the first quarter. The Bank’s liquidity position supported strong asset
growth while liquid assets, including Federal Reserve Bank cash and unencumbered securities, improved by $137.7 million or 3.8 times
the amount as of Dec. 31, 2008. As of March 31, 2009, non-interest bearing demand deposits increased $8.9 million from Dec. 31,
2008 levels or 2.7 percent, and total deposits, excluding demand deposit accounts and brokered deposits, increased by $150.4 million
or 9.2 percent. Reliance on brokered CDs was reduced by $28.1 million, a reduction of 6.4 percent compared to Dec. 31, 2008. The
Company’s liquidity position continues to improve and the core deposit gathering continues to show favorable trends.

Net Interest Margin

Net interest margin increased 12 basis points from 2.51 percent in the fourth quarter to 2.63 percent in the first quarter. Significant
margin improvement came from the narrowing of average prime and LIBOR spreads when compared to the fourth quarter. This benefit
was slightly offset by some variable rate loans which have yet to renew and become subject to recently implemented pricing floors and
an increase in nonaccrual loans. The strong loan growth in the first quarter positively impacted the margin. Maturities of approximately
$300 million of brokered CDs during the first quarter were replaced at lower rates helping to significantly reduce overall costs. Average
brokered CD balances decreased almost $50 million when compared to the fourth quarter.

Noninterest Expense

Noninterest expense for the first quarter 2009 was $21.8 million compared to $25.7 million in the fourth quarter 2008. Despite an
increase in FDIC insurance premiums of $670 thousand in the first quarter, noninterest expense declined $3.9 million. The decrease
was primarily attributable to a $2.7 million decline in salaries and benefits when compared to the fourth quarter. This was due in large
part to the difference in first quarter officer incentive expense including the reversal of $850 thousand accrued in prior periods. This
reversal was related to a reduction in previously planned staff bonuses and a recent decision to forego all 2008 bonuses for executive
officers. Professional services were down 35 percent, or $1.1 million compared to the fourth quarter due to expenses related to legal,
printing and consulting fees associated with the TARP and other capital raising efforts in the fourth quarter. Excluding non-recurring
items, on a normalized basis noninterest expense for the first quarter 2008 was $21.7 million.

Financial Highlights
Earnings

Income (loss) per common share was $(0.27) for the first quarter, compared to:
— $ 0.12 for fourth quarter 2008
— $ (0.22) for first quarter 2008

Net income (loss) was $(5.3) million for the first quarter, compared to:
— $ 4.4 million for fourth quarter 2008
— $ (5.4) million for first quarter 2008

Net interest margin was 2.63 percent for the first quarter, compared to:
— 2.51 percent for fourth quarter 2008
— 2.82 percent for first quarter 2008

Loans and Loan Quality

Average loans in the first quarter increased $44.0 million compared to fourth quarter 2008

Gross loans in the first quarter 2009 increased $81.3 million compared to fourth quarter 2008 facilitated by receipt of TARP investment

Annualized net charge-off rate was 0.70 percent for the first quarter 2009, compared to:
— 2.39 percent for the fourth quarter 2008
— 1.93 percent for the first quarter 2008

Nonaccrual loans at March 31, 2009 were $80.3 million or 3.10 percent of loans, compared to:
— 2.43 percent of loans at Dec. 31, 2008
— 1.90 percent of loans at March 31, 2008

Nonperforming assets (includes troubled debt restructuring) at March 31, 2009 were $109.9 million, or 2.96 percent of assets,
compared to:
— 2.36 percent of assets at Dec. 31, 2008
— 1.33 percent of assets at March 31, 2008

Allowance for loan losses at March 31, 2009 was $53.0 million, or 2.05 percent of loans, compared to:
— 1.77 percent of loans at Dec. 31, 2008
— 0.82 percent of loans at March 31, 2008

Allowance for loan losses to nonaccrual loans was 66 percent at March 31, 2009, compared to:
— 73 percent at Dec. 31, 2008
— 43 percent at March 31, 2008

Foreclosed properties at March 31, 2009 were $18.5 million compared to:
— $ 12.0 million at Dec. 31, 2008
— $ 2.5 million at March 31, 2008

Loan delinquencies 30-89 days were 1.48 percent of loans at March 31, 2009, compared to:
— 1.03 percent at Dec. 31, 2008
— 0.82 percent at March 31, 2008

Company Bank
Capital Ratios at March 31, 2009:
— Tier 1 risk-based 7.39% 7.52%
— Total risk-based 9.16% 10.51%
— Tier 1 leverage 6.22% 6.33%

Additional financial data are contained in the accompanying statements, tables and schedules.

Hosting a Conference Call

Midwest will conduct a conference call to discuss these results Wednesday, April 29, 2009, at 11:00 a.m. Eastern time / 10:00 a.m.
Central time.

The webcast and call will be hosted by members of management. A brief discussion of results and trends will be followed by questions
from professional investors and analysts invited to participate in the interactive portion of the discussion. Interested parties wishing to
participate in the interactive portion of the call can dial in to 800-860-2442 or +1 412-858-4600 for international calls. The live webcast
can be accessed and will be available for replay at www.midwestbank.com. The audio replay may be accessed through May 7, 2009,
at 877-344-7529 or +1 412-317-0088. The replay passcode is 429301.

About Midwest

Midwest Banc Holdings, Inc., with $3.7 billion in assets, has provided a range of retail and commercial financial services for more than
50 years, through its two principal operating subsidiaries: Midwest Bank and Trust Company and Midwest Financial and Investment
Services, Inc.

Midwest Bank operates 28 full-service community banking centers throughout the greater Chicagoland area meeting the diverse needs
of businesses and consumers through commercial banking, wealth management, corporate trust and retail banking areas. Midwest
Financial Services provides securities and insurance brokerage services.

Forward-Looking Statements

This press release contains certain “Forward-Looking Statements” within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and should be reviewed in conjunction with the
Company’s Annual Report on Form 10-K and other publicly available information regarding the Company, copies of which are available
from the Company upon request. Such publicly available information sets forth certain risks and uncertainties related to the Company’s
business which should be considered in evaluating “Forward-Looking Statements.”

Contacts
John B. Pelling, III, 708-498-2013
Vice President – Investor Relations
IR@midwestbank.com

Financial Highlights
(In thousands, except per share data and percentages)

Three Months Ended
March 31, Dec. 31, Sept. 30, June 30, March 31,
2009 2008 2008 2008 2008
Income Statement Data:
Net (loss) income $ (5,320) $ 4,429 $ (159,714) $ 2,428 $ (5,416)

Per Share Data:
Basic and diluted (loss) earnings $ (0.27) $ 0.12 $ (5.76) $ 0.06 $ (0.22)
Cash dividends declared — — — 0.13 0.13
Book value 6.38 6.56 5.89 11.76 12.14
“If converted” book value(10) 7.18 7.35 6.74 12.06 12.41
Tangible book value(1) 3.05 3.21 2.51 5.48 5.79
“If converted” tangible book value(1)(10) 4.16 4.31 3.68 6.37 6.65
Stock price at period end 1.01 1.40 4.00 4.87 12.78

Share Data:
Common shares outstanding – at period end 27,929 27,893 27,859 27,859 27,839
Basic — average 27,925 27,863 27,859 27,855 27,838
Diluted — average 27,925 27,863 27,859 27,958 27,838

Selected Financial Ratios:
Return on average assets (0.59) percent 0.49 percent (17.25) percent 0.26 percent (0.59) percent
Return on average equity (7.12) 7.17 (181.60) 2.57 (5.69)
Net interest margin (tax equivalent) 2.63 2.51 2.77 2.89 2.82
Efficiency ratio(2)(3) 84 105 387 70 66
Dividend payout ratio — — — 233 N/M
Loans to deposits at period end 102 104 99 107 103
Loans to assets at period end 70 70 70 67 66
Equity to assets at period end 8.11 8.57 5.78 9.95 10.22
Tangible equity to tangible assets at period end(1)(4) 5.75 6.11 3.24 5.51 5.75
Tier 1 capital to risk-weighted assets 7.39 8.30 6.26 9.09 9.33
Total capital to risk-weighted assets 9.16 10.07 8.04 10.43 10.61
Tier 1 leverage ratio 6.22 6.90 4.94 7.38 7.47

Full time equivalent employees 542 536 550 543 543

Balance Sheet Data:
Total earning assets $3,339,448 $3,195,408 $3,176,629 $3,275,580 $3,298,143
Average earning assets 3,268,589 3,219,078 3,263,571 3,274,335 3,276,965
Average assets 3,648,873 3,590,313 3,682,449 3,686,350 3,686,269
Average loans 2,543,770 2,499,802 2,512,653 2,459,486 2,459,830
Average securities 688,334 668,830 715,219 762,889 765,966
Average deposits 2,474,262 2,478,948 2,411,013 2,384,764 2,415,385
Tangible shareholders’ equity(1) 208,098 212,289 113,101 195,751 204,295
Average equity 303,019 245,795 349,878 379,677 382,603

See footnotes at end of statements, tables and schedules.

Statement of Income
(In Thousands, except per share data)

Three Months Ended
2008 2008 2008 2008
2009
Interest Income
Loans $ 34,549 $ 35,558 $ 37,364 $37,392 $ 40,806
Securities
Taxable 6,940 7,381 7,739 8,977 9,060
Exempt from federal income taxes 550 551 574 593 598
Dividends from FRB and FHLB stock 190 190 184 184 183
Short-term investments 37 54 27 98 148
Total interest income 42,266 43,734 45,888 47,244 50,795

Interest Expense
Deposits 13,685 15,524 15,301 16,111 19,089
Federal funds purchased and FRB discount window
advances 29 14 563 672 815
Securities sold under repurchase agreements 3,205 3,264 3,338 3,482 3,178
Advances from the FHLB 3,029 3,126 2,779 2,437 3,482
Junior subordinated debentures 739 911 864 876 1,045
Revolving note payable 43 204 96 94 80
Term note payable 282 616 565 575 887
Subordinated debt 152 243 229 232 3
Total interest expense 21,164 23,902 23,735 24,479 28,579

Net interest income 21,102 19,832 22,153 22,765 22,216
Provision for loan losses 13,000 20,000 41,950 4,415 5,400
Net interest income after provision for loan losses 8,102 (168) (19,797) 18,350 16,816

Noninterest Income
Service charges on deposit accounts 1,894 1,908 1,918 1,953 1,963
(Losses) gains on securities transactions — — (16,652) 44 12
Impairment loss on securities — — (47,801) — (17,586)
Gains on sales of loans — — (75) — —
Insurance and brokerage commissions 320 333 448 683 560
Trust 282 241 451 482 449
Increase in CSV of life insurance 842 875 911 865 858
Gain on sale of property — — — — 15,196
Other 5 375 288 367 338
Total noninterest income (loss) 3,343 3,732 (60,512) 4,394 1,790

Noninterest Expenses
Salaries and employee benefits 11,083 13,819 12,515 11,015 13,040
Occupancy and equipment 3,245 3,511 3,211 3,093 2,899
Professional services 2,102 3,240 2,016 1,796 1,538
Marketing 688 842 575 713 576
Foreclosed properties 345 66 24 237 5
Amortization of intangible assets 573 590 590 591 590
Merger related charges — — 77 80 114
Loss on extinguishment of debt — — — — 7,121
Goodwill impairment charge — — 80,000 — —
Other 3,725 3,610 4,288 2,843 2,726
Total noninterest expenses 21,761 25,678 103,296 20,368 28,609

(Loss) income before income taxes (10,316) (22,114) (183,605) 2,376 (10,003)
Benefit for income taxes (4,996) (26,543) (23,891) (52) (4,587)
Net (Loss) Income $ (5,320) $ 4,429 $(159,714) $ 2,428 $ (5,416)

Net (loss) income available to common shareholders $ (7,443) $ 3,207 $(160,550) $ 1,592 $ (6,251)

Basic and diluted (loss) earnings per share $ (0.27) $ 0.12 $ (5.76) $ 0.06 $ (0.22)
Cash dividends declared per share $ — $ — $ — $ 0.13 $ 0.13

Top line revenue (5) $ 24,445 $ 23,564 $ (38,359) $27,159 $ 24,006
Noninterest income to top line revenue 14 percent 16 percent N/M 16 percent 7 percent

Balance Sheet .

(In thousands)

2009 2008 2008 2008 2008
Assets
Cash $ 56,516 $ 61,330 $ 111,769 $ 85,015 $ 71,080
Short-term investments 1,762 1,735 1,674 3,042 31,415

Securities available-for-sale 685,858 621,949 618,215 710,803 737,089
Securities held-to-maturity 29,082 30,267 30,817 31,389 32,674
Total securities 714,940 652,216 649,032 742,192 769,763

Federal Reserve and FHLB stock, at cost 31,698 31,698 31,698 29,264 29,264

Loans 2,591,048 2,509,759 2,494,225 2,501,082 2,467,701
Allowance for loan losses (53,011) (44,432) (39,428) (22,606) (20,344)
Net loans 2,538,037 2,465,327 2,454,797 2,478,476 2,447,357

Cash value of life insurance 85,517 84,675 83,800 82,889 82,024
Premises and equipment 38,528 38,313 38,216 38,739 38,232
Foreclosed properties 18,534 12,018 8,025 2,375 2,527
Goodwill and other intangibles 92,972 93,546 94,136 174,947 176,861
Other 134,560 129,354 110,230 89,781 81,923
Total assets $3,713,064 $3,570,212 $3,583,377 $3,726,720 $3,730,446

Liabilities and Shareholders’ Equity
Liabilities
Deposits
Noninterest-bearing $ 343,422 $ 334,495 $ 334,545 $ 334,813 $ 313,727
Interest-bearing 2,200,583 2,078,296 2,178,459 2,005,230 2,090,985
Total deposits 2,544,005 2,412,791 2,513,004 2,340,043 2,404,712

Federal funds purchased & FRB discount window 55,000 — — 198,000 184,500
Securities sold under repurchase agreements 297,650 297,650 297,650 297,650 394,764
FHLB advances 340,000 380,000 380,000 340,000 190,000
Junior subordinated debentures 60,807 60,791 60,774 60,757 60,741
Revolving note payable 8,600 8,600 20,600 7,600 6,500
Term note payable 55,000 55,000 55,000 55,000 55,000
Subordinated debt 15,000 15,000 15,000 15,000 15,000
Other 35,932 34,546 34,112 41,972 38,073
Total liabilities 3,411,994 3,264,378 3,376,140 3,356,022 3,349,290

Shareholders’ Equity
Preferred equity 122,976 122,748 43,125 43,125 43,125
Common equity 178,362 185,208 175,806 335,662 336,877
Accumulated other comprehensive income (loss) (268) (2,122) (11,694) (8,089) 1,154
Total shareholders’ equity 301,070 305,834 207,237 370,698 381,156
Total liabilities and shareholders’ equity $3,713,064 $3,570,212 $3,583,377 $3,726,720 $3,730,446

Loan Portfolio Composition — Source of Repayment

March 31, 2009 Dec. 31, 2008
Percent of Percent of
($ in millions) Total ($ in millions) Total
Commercial $ 1,106 43 $ 1,090 43
Construction 373 14 366 15
Commercial real estate 774 30 730 29
Consumer 220 8 201 8

Residential mortgage 119 5 123 5
Total loans, gross excluding deferred fees $ 2,592 100 $ 2,510 100

Net Interest Margin
(In thousands)
For the Three Months Ended
March 31, 2009 Dec. 31, 2008 March 31, 2008
Average Average Average Average Average Average
Balance Rate Balance Rate Balance Rate
Interest-Earning Assets:
Short-term investments $ 4,787 3.09 percent $ 18,748 1.15 percent $ 21,939 2.70 percent
Securities:
Taxable(6) 629,783 4.41 610,160 4.84 704,119 5.43
Exempt from federal income taxes(6) 58,551 5.78 58,670 5.78 61,847 5.95
Total securities 688,334 4.52 668,830 4.92 765,966 5.48
FRB and FHLB stock 31,698 2.40 31,698 2.40 29,230 2.50
Loans (7)(8)(9) 2,543,770 5.44 2,499,802 5.70 2,459,830 6.65
Total interest-earning assets $3,268,589 5.22 percent $3,219,078 5.48 percent $3,276,965 6.31 percent

Noninterest-Earning Assets:
Cash $ 69,006 $ 63,352 $ 55,634
Premises and equipment 38,166 38,208 41,325
Allowance for loan losses (46,503) (41,522) (27,287)
Other 319,615 311,197 339,632
Total noninterest-earning assets 380,284 371,235 409,304
Total assets $3,648,873 $3,590,313 $3,686,269

Interest-Bearing Liabilities:
Deposits:
Interest-bearing demand deposits $ 173,291 0.59 percent $ 176,803 0.72 percent $ 217,515 1.37 percent
Money-market demand and savings accounts 351,778 0.86 334,217 0.94 411,091 1.78
Time deposits 1,618,236 3.13 1,637,302 3.52 1,470,272 4.49
Total interest-bearing deposits 2,143,305 2.55 2,148,322 2.89 2,098,878 3.64
Borrowings:
Fed funds purch & repurchase agreements 333,990 3.87 305,242 4.30 402,774 3.97
FHLB advances 363,000 3.34 380,000 3.29 315,158 4.42
Junior subordinated debentures 60,799 4.86 60,783 6.00 60,733 6.88
Revolving note payable 8,600 2.00 17,470 4.67 6,368 5.03
Term note payable 55,000 2.05 55,000 4.48 69,835 5.08
Subordinated debt 15,000 4.05 15,000 6.48 165 7.27
Total borrowings 836,389 3.58 833,495 4.02 855,033 4.44
Total interest-bearing liabilities $2,979,694 2.84 percent $2,981,817 3.21 percent $2,953,911 3.87 percent

Noninterest-Bearing Liabilities:
Noninterest-bearing demand deposits $ 330,957 $ 330,626 $ 316,507
Other liabilities 35,203 32,075 33,248
Total noninterest-bearing liabilities 366,160 362,701 349,755
Shareholders’ equity 303,019 245,795 382,603
Total liabilities and shareholders’ equity $3,648,873 $3,590,313 $3,686,269

2.63 percent 2.51 percent 2.82 percent
Net interest margin (tax equivalent)(6)(9)


Credit Risk Management
(In thousands)
Three Months Ended
2009 2008 2008 2008 2008
Loan Quality
Nonaccrual loans $ 80,332 $ 61,104 $ 60,474 $ 40,956 $ 46,916
Troubled debt restructuring 11,006 11,006 — — —
Nonperforming loans 91,338 72,110 60,474 40,956 46,916
Foreclosed properties 18,534 12,018 8,025 2,375 2,527

Nonperforming assets $ 109,872 $ 84,128 $ 68,499 $ 43,331 $ 49,443

90+ days past due and accruing $ — $ — $ — $ 4,320 $ —

Loans $2,591,048 $2,509,759 $2,494,225 $2,501,082 $2,467,701

Loan-related assets $2,609,582 $2,521,777 $2,502,250 $2,503,457 $2,470,228

Nonaccrual loans to loans 3.10 percent 2.43 percent 2.42 percent 1.64 percent 1.90 percent

Nonperforming assets to loan-related assets 4.21 percent 3.34 percent 2.74 percent 1.73 percent 2.00 percent

Nonperforming assets to total assets 2.96 percent 2.36 percent 1.91 percent 1.16 percent 1.33 percent

Allowance for Loan Losses
Beginning balance $ 44,432 $ 39,428 $ 22,606 $ 20,344 $ 26,748
Provision for loan losses 13,000 20,000 41,950 4,415 5,400
Net chargeoffs (recoveries) 4,421 14,996 25,128 2,153 11,804
Ending balance $ 53,011 $ 44,432 $ 39,428 $ 22,606 $ 20,344

Net chargeoffs to average loans 0.70 percent 2.39 percent 3.98 percent 0.35 percent 1.93 percent

Delinquencies 30 – 89 days to loans 1.48 percent 1.03 percent 0.99 percent 0.35 percent 0.82 percent

Allowance for loan losses to Loans at period end 2.05 percent 1.77 percent 1.58 percent 0.90 percent 0.82 percent
Nonaccrual loans 66 percent 73 percent 65 percent 55 percent 43 percent

Footnotes
(In thousands)
(1) Shareholders’ equity less goodwill and net core deposit intangible and other intangibles.

2009 2008 2008 2008 2008
Shareholders’ equity $301,070 $305,834 $207,237 $ 370,698 $ 381,156
Core deposit intangible & other intangibles, net (14,110) (14,683) (15,274) (15,864) (16,454)
Goodwill (78,862) (78,862) (78,862) (159,083) (160,407)
Tangible shareholders’ equity $208,098 $212,289 $113,101 $ 195,751 $ 204,295

(2) Excludes net gains or losses on securities transactions.

(3) Noninterest expense less amortization and foreclosed properties expenses divided by the sum of net interest income (tax
equivalent) plus noninterest income.
(4) Total assets less goodwill and net core deposit intangible and other intangibles.

2009 2008 2008 2008 2008
Total assets $3,713,064 $3,570,212 $3,583,377 $3,726,720 $3,730,446
Core deposit intangible & other intangibles, net (14,110) (14,683) (15,274) (15,864) (16,454)
Goodwill (78,862) (78,862) (78,862) (159,083) (160,407)
Tangible assets $3,620,092 $3,476,667 $3,489,241 $3,551,773 $3,553,585

(5) Includes net interest income and noninterest income.

(6) Adjusted for 35 percent tax rate and for the dividends-received deduction where applicable.
(7) Nonaccrual loans are included in the average balance; however, these loans are not earning any interest.

(8) Includes loan fees.
(9) Reconciliation of reported net interest income to tax equivalent net interest income.

Three Months Ended
March 31, Dec. 31, March 31,
2009 2008 2008
Net interest income $ 21,102 $19,832 $ 22,216
Tax equivalent adjustment to net interest income 357 363 892
Net interest income, tax equivalent basis $ 21,459 $20,195 $ 23,108

(10) Reconciliation of common equity to shareholders’ equity.

2009 2008 2008 2008 2008
Preferred equity $122,976 $122,748 $ 43,125 $ 43,125 $ 43,125
Common equity 178,094 183,086 164,112 327,573 338,031
Shareholders’ equity $301,070 $305,834 $207,237 $370,698 $381,156

Reconciliation of tangible common equity to tangible shareholders’ equity.

2009 2008 2008 2008 2008
Preferred equity $122,976 $122,748 $ 43,125 $ 43,125 $ 43,125
Tangible common equity 85,122 89,541 69,976 152,626 161,170
Tangible shareholders’ equity $208,098 $212,289 $113,101 $195,751 $204,295

Reconciliation of common shares outstanding at period end to “if converted” shares outstanding.

2009 2008 2008 2008 2008
Common shares outstanding 27,929 27,893 27,859 27,859 27,839
Resulting common shares if preferred shares were

converted 2,875 2,875 2,875 2,875 2,875
“If converted” shares outstanding 30,804 30,768 30,734 30,734 30,714

(Back To Top)

Q1 2009 Earning Report of Midwest Banc Holdings, Inc.

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Viewers also liked

Viewers also liked (8)

Similar to Q1 2009 Earning Report of Midwest Banc Holdings, Inc.

Similar to Q1 2009 Earning Report of Midwest Banc Holdings, Inc. (20)

More from earningreport earningreport

More from earningreport earningreport (20)

Recently uploaded

Recently uploaded (20)

Q1 2009 Earning Report of Midwest Banc Holdings, Inc.