Middlefield Banc Corp. Reports 2024 Twelve-Month Financial Results

Source: Nasdaq GlobeNewswire / 23 Jan 2025 15:15:55 America/Chicago

MIDDLEFIELD, Ohio, Jan. 23, 2025 (GLOBE NEWSWIRE) -- Middlefield Banc Corp. (NASDAQ: MBCN) today reported financial results for the twelve months ended December 31, 2024.

2024 Fourth Quarter Financial Highlights:

Earnings increased 36.4% year-over-year to $0.60 per diluted share
Return on average assets (annualized) increased 26 basis points year-over-year to 1.04%
Asset quality remained stable compared to the 2024 third quarter with nonperforming assets to total assets of 1.62%

2024 Full Year Financial Highlights:

Total loans increased 2.8% to a record $1.52 billion
Book value increased 2.6% year-over-year to $26.08 per share at December 31, 2024
Tangible book value⁽¹⁾ increased 3.9% year-over-year to $20.88 per share at December 31, 2024
Returned $7.5 million back to shareholders through the Company's quarterly dividend policy and share repurchases

⁽¹⁾See non-GAAP reconciliation under the section “GAAP to Non-GAAP Reconciliations”

Ronald L. Zimmerly, Jr., President and Chief Executive Officer, stated, “Our 2024 fourth quarter marks one of the most profitable quarters in Middlefield’s 124-year history, supported by the talents of our team and the strengths of our community banking platform. During the quarter, we experienced higher net interest income, grew non-interest income, achieved stable asset quality, and controlled operating expenses. These results produced record fourth quarter net income and a 26-basis point year-over-year expansion in our annualized return on average assets. I am proud of this performance, highlighting Middlefield’s resilience and ability to navigate a dynamic banking environment.”

“While we expect competition for deposits will continue, our loan pipeline remains robust, and our continued quarter over quarter increase in loans is indicative of strong origination activity across our Ohio markets. We believe 2025 will be another good year of profitable growth for Middlefield, reflecting our longstanding commitment to our communities, disciplined underwriting standards, and continued investments in our business,” concluded Mr. Zimmerly.

Income Statement
Net interest income for the twelve months ended December 31, 2024, decreased $4.5 million to $60.7 million, compared to $65.2 million for the same period last year. The net interest margin for the twelve months ended December 31, 2024, was 3.52%, compared to 3.97% last year. Net interest income for the 2024 fourth quarter increased $179,000 to $15.6 million, compared to $15.4 million for the 2023 fourth quarter. The net interest margin for the 2024 fourth quarter was 3.56%, compared to 3.63% for the same period of 2023.

For the twelve months ended December 31, 2024, noninterest income increased $522,000 to $7.2 million, compared to $6.7 million for the same period in 2023. Noninterest income for the 2024 fourth quarter was $1.9 million, compared to $1.6 million for the same period the previous year.

Noninterest expense for the twelve months ended December 31, 2024, was $47.5 million, compared to $48.1 million for the same period in 2023. For the 2024 fourth quarter, noninterest expense was $11.8 million, compared to $12.2 million for the 2023 fourth quarter.

Net income for the twelve months ended December 31, 2024, was $15.5 million, or $1.92 per diluted share, compared to $17.4 million, or $2.14 per diluted share, for the same period last year. Net income for the 2024 fourth quarter was $4.8 million, or $0.60 per diluted share, compared to $3.5 million, or $0.44 per diluted share, for the same period last year.

For the twelve months ended December 31, 2024, pre-tax, pre-provision net income was $20.4 million, compared to $23.8 million last year. For the 2024 fourth quarter, pre-tax, pre-provision net income was $5.7 million, compared to $4.8 million for the same period of 2023. (See non-GAAP reconciliation under the section “GAAP to Non-GAAP Reconciliations”.)

Balance Sheet
Total assets at December 31, 2024, increased 1.7% to $1.85 billion, compared to $1.82 billion at December 31, 2023. Total loans at December 31, 2024, were $1.52 billion, compared to $1.48 billion at December 31, 2023. The 2.8% year-over-year increase in total loans was primarily due to originations within the residential real estate and non-owner occupied loan segments as well as home equity lines of credit, offset by a decrease in construction and other loans due to the conversion to permanent loans. The investment securities available-for-sale portfolio was $165.8 million at December 31, 2024, compared with $170.8 million at December 31, 2023.

Total liabilities at December 31, 2024, increased 1.6% to $1.64 billion, compared to $1.62 billion at December 31, 2023. Total deposits at December 31, 2024, were $1.45 billion, compared to $1.43 billion at December 31, 2023. The 1.3% year-over-year increase in deposits was primarily due to growth in money market accounts, partially offset by declines in time deposits, noninterest-bearing demand, and savings accounts. Noninterest-bearing demand deposits were 26.1% of total deposits at December 31, 2024, compared to 28.1% at December 31, 2023. At December 31, 2024, the Company had brokered deposits of $35.1 million, compared to $90.3 million at December 31, 2023.

Michael C. Ranttila, Chief Financial Officer, stated, “The rate environment was volatile during the fourth quarter, which temporarily increased our accumulated other comprehensive loss. Against this backdrop, we also strategically let brokered deposits mature during the fourth quarter to see how the market would respond to the December 2024 Fed rate cut. Despite these impacts, our capital levels continue to expand, and at December 31, 2024, our equity to assets ratio improved year-over-year and from September 30, 2024 levels. Overall liquidity remains robust with access to the Federal Reserve Board’s discount window, cash and investments of $221.6 million, and additional borrowing capacity of $381.7 million on Federal Home Loan Bank advances at December 31, 2024.”

Middlefield's CRE portfolio included the following categories at December 31, 2024:

	Balance		Percent of			Percent of			Weighted Average
	(in thousands)		CRE Portfolio			Loan Portfolio			Loan-to-Value

Multi-Family	$	89,849		13.1	%		5.9	%		58.3	%
Owner Occupied
Real Estate and Rental and Leasing		62,647		9.2	%		4.1	%		56.0	%
Other Services (except Public Administration)		30,320		4.4	%		2.0	%		53.9	%
Manufacturing		16,617		2.4	%		1.1	%		49.0	%
Agriculture, Forestry, Fishing and Hunting		12,881		1.9	%		0.8	%		36.9	%
Accommodation and Food Services		11,272		1.6	%		0.7	%		56.5	%
Other		47,710		6.9	%		3.1	%		53.8	%
Total Owner Occupied	$	181,447		26.4	%		11.8	%
Non-Owner Occupied
Real Estate and Rental and Leasing		338,981		49.6	%		22.3	%		69.6	%
Accommodation and Food Services		40,398		5.9	%		2.7	%		54.9	%
Health Care and Social Assistance		20,144		2.9	%		1.3	%		56.7	%
Manufacturing		7,108		1.0	%		0.5	%		51.1	%
Other		5,660		1.1	%		0.4	%		73.7	%
Total Non-Owner Occupied	$	412,291		60.5	%		27.2	%
Total CRE	$	683,587		100.0	%		44.9	%

Stockholders' Equity and Dividends
At December 31, 2024, stockholders' equity was $210.6 million, compared to $205.7 million at December 31, 2023. The 2.4% year-over-year increase in stockholders' equity was primarily from higher retained earnings, partially offset by an increase in the unrealized loss on the available-for-sale investment portfolio and stock acquired under the Company's stock repurchase program. On a per-share basis, shareholders' equity at December 31, 2024, was $26.08, compared to $25.41 at December 31, 2023.

At December 31, 2024, tangible stockholders' equity⁽¹⁾ was $168.6 million, compared to $162.7 million at December 31, 2023. On a per-share basis, tangible stockholders' equity⁽¹⁾ was $20.88 at December 31, 2024, compared to $20.10 at December 31, 2023. ⁽¹⁾See non-GAAP reconciliation under the section “GAAP to Non-GAAP Reconciliations”.

For the twelve months ended December 31, 2024, the Company declared cash dividends of $0.80 per share, totaling $6.5 million.

For the twelve months ended December 31, 2024, the Company repurchased 43,858 shares of its common stock, at an average price of $24.00 per share. The repurchases occurred during the first quarter of 2024.

At December 31, 2024, the Company's equity-to-assets ratio was 11.36%, compared to 11.28% at December 31, 2023.

Asset Quality
For the twelve months ended December 31, 2024, the Company recorded a provision for credit losses of $2.0 million, versus a provision for credit losses of $3.0 million for the same period last year. For the 2024 fourth quarter, the Company recorded a recovery of credit losses of $177,000, compared to a provision for credit losses of $554,000 for the same period of 2023.

Net charge-offs were $1.4 million, or 0.10% of average loans, for the twelve months ended December 31, 2024, compared to net recoveries of $31,000, or 0.00% of average loans, for the same period last year. Net charge-offs were $151,000, or 0.04% of average loans, annualized, for the 2024 fourth quarter, compared to net recoveries of $117,000, or (0.03%) of average loans, annualized, for the same period of 2023. The higher net charge-offs were due to the partial charge-off of one loan during the 2024 third quarter.

Nonperforming assets at December 31, 2024, which consisted of nonperforming loans, were $30.0 million, compared to $10.9 million at December 31, 2023. The increase in nonperforming assets is primarily the result of a $13.5 million loan moved to nonaccrual in the 2024 third quarter, subsequent to the partial charge-off noted in the previous paragraph. The allowance for credit losses at December 31, 2024, stood at $22.4 million, or 1.48% of total loans, compared to $21.7 million, or 1.47% of total loans at December 31, 2023. The increase in the allowance for credit losses was mainly from an overall increase in total loans as well as changes in projected loss drivers, prepayment assumptions, curtailment expectations over the reasonable and supportable forecast period, and geographic footprint of unemployment data.

Mr. Ranttila continued, “With nearly 70% of our loan portfolio subject to repricing at December 31, 2024, we are cautiously optimistic we can maintain a stable net interest margin throughout 2025. In addition, credit quality remained firm during the fourth quarter, and we are well reserved with an allowance for credit losses to total loans of 1.48% at December 31, 2024. We expect stable economic activity across our Central, Western and Northeast Ohio markets will support loan demand and asset quality throughout 2025.”

About Middlefield Banc Corp.
Middlefield Banc Corp., headquartered in Middlefield, Ohio, is the Bank holding Company of The Middlefield Banking Company, with total assets of $1.85 billion at December 31, 2024. The Bank operates 21 full-service banking centers and an LPL Financial® brokerage office serving Ada, Beachwood, Bellefontaine, Chardon, Cortland, Dublin, Garrettsville, Kenton, Mantua, Marysville, Middlefield, Newbury, Orwell, Plain City, Powell, Solon, Sunbury, Twinsburg, and Westerville. The Bank also operates a Loan Production Office in Mentor, Ohio.

Additional information is available at www.middlefieldbank.bank

NON-GAAP FINANCIAL MEASURES
This press release includes disclosure of Middlefield Banc Corp.'s tangible book value per share, return on average tangible equity, and pre-tax, pre-provision for loan losses income, which are financial measures not prepared in accordance with generally accepted accounting principles in the United States (GAAP). A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts required to be disclosed by GAAP. Middlefield Banc Corp. believes that these non-GAAP financial measures provide both management and investors a more complete understanding of the underlying operational results and trends and Middlefield Banc Corp.'s marketplace performance. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the numbers prepared in accordance with GAAP. The reconciliations of non-GAAP financial measures are included in the following Consolidated Financial Highlights tables below.

FORWARD-LOOKING STATEMENTS
This press release of Middlefield Banc Corp. and the reports Middlefield Banc Corp. files with the Securities and Exchange Commission often contain "forward-looking statements" relating to present or future trends or factors affecting the banking industry and, specifically, the financial operations, markets and products of Middlefield Banc Corp. These forward-looking statements involve certain risks and uncertainties. There are several important factors that could cause Middlefield Banc Corp.'s future results to differ materially from historical performance or projected performance. These factors include, but are not limited to: (1) a significant increase in competitive pressures among financial institutions; (2) changes in the interest rate environment that may reduce interest margins; (3) changes in prepayment speeds, charge-offs and loan loss provisions; (4) less favorable than expected general economic conditions; (5) legislative or regulatory changes that may adversely affect businesses in which Middlefield Banc Corp. is engaged; (6) technological issues which may adversely affect Middlefield Banc Corp.'s financial operations or customers; (7) changes in the securities markets; or (8) risk factors mentioned in the reports and registration statements Middlefield Banc Corp. files with the Securities and Exchange Commission. Middlefield Banc Corp. undertakes no obligation to release revisions to these forward-looking statements or to reflect events or circumstances after the date of this press release.

Company Contact:	Investor and Media Contact:
Ronald L. Zimmerly, Jr. President and Chief Executive Officer Middlefield Banc Corp. (419) 673-1217 rzimmerly@middlefieldbank.com	Andrew M. Berger Managing Director SM Berger & Company, Inc. (216) 464-6400 andrew@smberger.com

MIDDLEFIELD BANC CORP.
Consolidated Selected Financial Highlights
(Dollar amounts in thousands, unaudited)

	December 31,		September 30,		June 30,		March 31,		December 31,
Balance Sheets (period end)	2024		2024		2024		2024		2023
ASSETS
Cash and due from banks	$	46,037	$	61,851	$	50,496	$	44,816	$	56,397
Federal funds sold		9,755		12,022		1,762		1,438		4,439
Cash and cash equivalents		55,792		73,873		52,258		46,254		60,836
Investment securities available for sale, at fair value		165,802		169,895		166,424		167,890		170,779
Other investments		855		895		881		907		955
Loans held for sale		-		249		-		-		-
Loans:
Commercial real estate:
Owner occupied		181,447		187,313		182,809		178,543		183,545
Non-owner occupied		412,291		407,159		385,648		398,845		401,580
Multifamily		89,849		94,798		86,951		81,691		82,506
Residential real estate		353,442		345,748		337,121		331,480		328,854
Commercial and industrial		229,034		213,172		234,702		227,433		221,508
Home equity lines of credit		143,379		137,761		131,047		129,287		127,818
Construction and other		103,608		111,550		132,530		135,716		125,105
Consumer installment		6,564		7,030		6,896		7,131		7,214
Total loans		1,519,614		1,504,531		1,497,704		1,490,126		1,478,130
Less allowance for credit losses		22,447		22,526		21,795		21,069		21,693
Net loans		1,497,167		1,482,005		1,475,909		1,469,057		1,456,437
Premises and equipment, net		20,565		20,528		20,744		21,035		21,339
Goodwill		36,356		36,356		36,356		36,356		36,356
Core deposit intangibles		5,611		5,869		6,126		6,384		6,642
Bank-owned life insurance		35,259		35,049		34,802		34,575		34,349
Accrued interest receivable and other assets		35,952		32,916		34,686		34,210		35,190
TOTAL ASSETS	$	1,853,359	$	1,857,635	$	1,828,186	$	1,816,668	$	1,822,883

	December 31,			September 30,			June 30,			March 31,			December 31,
	2024			2024			2024			2024			2023
LIABILITIES
Deposits:
Noninterest-bearing demand	$	377,875		$	390,933		$	387,024		$	390,185		$	401,384
Interest-bearing demand		208,291			218,002			206,542			209,015			205,582
Money market		414,074			376,619			355,630			318,823			274,682
Savings		197,749			199,984			192,472			196,721			210,639
Time		247,704			327,231			327,876			332,165			334,315
Total deposits		1,445,693			1,512,769			1,469,544			1,446,909			1,426,602
Federal Home Loan Bank advances		172,400			106,000			125,000			137,000			163,000
Other borrowings		11,660			11,711			11,762			11,812			11,862
Accrued interest payable and other liabilities		13,044			16,450			15,092			15,372			15,738
TOTAL LIABILITIES		1,642,797			1,646,930			1,621,398			1,611,093			1,617,202
STOCKHOLDERS' EQUITY
Common stock, no par value; 25,000,000 shares authorized, 9,953,018
shares issued, 8,073,708 shares outstanding as of December 31, 2024		161,999			161,916			161,823			161,823			161,388
Additional paid-in capital		246			108			-			-			-
Retained earnings		109,299			106,067			105,342			102,791			100,237
Accumulated other comprehensive loss		(20,073	)		(16,477	)		(19,468	)		(18,130	)		(16,090	)
Treasury stock, at cost; 1,879,310 shares as of December 31, 2024		(40,909	)		(40,909	)		(40,909	)		(40,909	)		(39,854	)
TOTAL STOCKHOLDERS' EQUITY		210,562			210,705			206,788			205,575			205,681
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	1,853,359		$	1,857,635		$	1,828,186		$	1,816,668		$	1,822,883

MIDDLEFIELD BANC CORP.
Consolidated Selected Financial Highlights
(Dollar amounts in thousands, unaudited)

	For the Three Months Ended														For the Twelve Months Ended
	December 31,			September 30,		June 30,			March 31,			December 31,			December 31,			December 31,
Statements of Income	2024			2024		2024			2024			2023			2024			2023
INTEREST AND DIVIDEND INCOME
Interest and fees on loans	$	23,308		$	23,441	$	23,422		$	22,395		$	22,027		$	92,566		$	81,963
Interest-earning deposits in other institutions		320			348		386			437			370			1,491			1,289
Federal funds sold		151			143		122			152			94			568			771
Investment securities:
Taxable interest		528			528		505			467			479			2,028			1,893
Tax-exempt interest		961			962		966			972			976			3,861			3,914
Dividends on stock		170			191		198			189			144			748			471
Total interest and dividend income		25,438			25,613		25,599			24,612			24,090			101,262			90,301
INTEREST EXPENSE
Deposits		8,582			8,792		8,423			7,466			6,522			33,263			18,995
Short-term borrowings		1,128			1,575		1,920			1,993			2,013			6,616			5,386
Other borrowings		173			173		173			184			179			703			717
Total interest expense		9,883			10,540		10,516			9,643			8,714			40,582			25,098
NET INTEREST INCOME		15,555			15,073		15,083			14,969			15,376			60,680			65,203
Provision (Recovery of) for credit losses		(177	)		2,234		87			(136	)		554			2,008			3,002
NET INTEREST INCOME AFTER PROVISION
(RECOVERY OF) FOR CREDIT LOSSES		15,732			12,839		14,996			15,105			14,822			58,672			62,201
NONINTEREST INCOME
Service charges on deposit accounts		1,068			959		971			909			997			3,907			3,878
Gain (Loss) on equity securities		56			14		(27	)		(52	)		(4	)		(9	)		(161	)
Loss on other real estate owned		-			-		-			-			(172	)		-			(170	)
Earnings on bank-owned life insurance		230			246		227			227			196			930			823
Gain on sale of loans		64			56		69			10			23			199			97
Revenue from investment services		237			206		269			204			193			916			743
Gross rental income		1			-		-			67			132			68			421
Other income		258			262		251			431			237			1,202			1,060
Total noninterest income		1,914			1,743		1,760			1,796			1,602			7,213			6,691
NONINTEREST EXPENSE
Salaries and employee benefits		5,996			6,201		6,111			6,333			6,646			24,641			24,511
Occupancy expense		596			627		601			552			512			2,376			2,566
Equipment expense		221			203		261			240			273			925			1,241
Data processing costs		1,174			1,214		1,135			1,217			1,348			4,740			4,764
Ohio state franchise tax		390			399		397			397			397			1,583			1,578
Federal deposit insurance expense		293			255		256			251			285			1,055			861
Professional fees		611			539		557			558			660			2,265			2,293
Advertising expense		371			283		508			419			162			1,581			1,477
Software amortization expense		83			74		21			22			22			200			95
Core deposit intangible amortization		258			257		258			258			264			1,031			1,059
Gross other real estate owned expenses		-			-		-			99			120			99			510
Merger-related costs		-			-		-			-			-			-			473
Other expense		1,810			1,819		1,797			1,619			1,483			7,045			6,709
Total noninterest expense		11,803			11,871		11,902			11,965			12,172			47,541			48,137
Income before income taxes		5,843			2,711		4,854			4,936			4,252			18,344			20,755
Income taxes		995			371		690			769			709			2,825			3,387
NET INCOME	$	4,848		$	2,340	$	4,164		$	4,167		$	3,543		$	15,519		$	17,368
PTPP ⁽¹⁾	$	5,666		$	4,945	$	4,941		$	4,800		$	4,806		$	20,352		$	23,757

MIDDLEFIELD BANC CORP.
Consolidated Selected Financial Highlights
(Dollar amounts in thousands, except per share and share amounts, unaudited)

	For the Three Months Ended															For the Twelve Months Ended
	December 31,			September 30,			June 30,			March 31,			December 31,			December 31,			December 31,
	2024			2024			2024			2024			2023			2024			2023
Per common share data
Net income per common share - basic	$	0.60		$	0.29		$	0.52		$	0.52		$	0.44		$	1.93		$	2.14
Net income per common share - diluted	$	0.60		$	0.29		$	0.52		$	0.51		$	0.44		$	1.92		$	2.14
Dividends declared per share	$	0.20		$	0.20		$	0.20		$	0.20		$	0.25		$	0.80		$	0.85
Book value per share (period end)	$	26.08		$	26.11		$	25.63		$	25.48		$	25.41		$	26.08		$	25.41
Tangible book value per share (period end) ^{(1) (2)}	$	20.88		$	20.87		$	20.37		$	20.18		$	20.10		$	20.88		$	20.10
Dividends declared	$	1,616		$	1,615		$	1,613		$	1,613		$	2,023		$	6,457		$	6,864
Dividend yield		2.84	%		2.76	%		3.34	%		3.37	%		3.06	%		2.85	%		2.63	%
Dividend payout ratio		33.33	%		69.02	%		38.74	%		38.71	%		57.10	%		41.61	%		39.52	%
Average shares outstanding - basic		8,071,905			8,071,032			8,067,144			8,091,203			8,093,478			8,075,300			8,103,230
Average shares outstanding - diluted		8,092,357			8,086,872			8,072,499			8,096,317			8,116,261			8,086,098			8,126,013
Period ending shares outstanding		8,073,708			8,071,032			8,067,144			8,067,144			8,095,252			8,073,708			8,095,252
Selected ratios
Return on average assets (Annualized)		1.04	%		0.50	%		0.91	%		0.92	%		0.78	%		0.84	%		0.99	%
Return on average equity (Annualized)		9.19	%		4.45	%		8.15	%		8.16	%		7.13	%		7.48	%		8.83	%
Return on average tangible common equity ^{(1) (3)}		11.50	%		5.58	%		10.29	%		10.30	%		9.11	%		9.41	%		11.20	%
Efficiency ⁽⁴⁾		65.05	%		67.93	%		67.97	%		68.68	%		68.99	%		67.38	%		64.49	%
Equity to assets at period end		11.36	%		11.34	%		11.31	%		11.32	%		11.28	%		11.36	%		11.28	%
Noninterest expense to average assets		0.63	%		0.66	%		0.64	%		0.66	%		0.68	%		2.58	%		2.74	%

⁽¹⁾ See section “GAAP to Non-GAAP Reconciliations” for the reconciliation of GAAP performance measures to non-GAAP measures.

⁽²⁾ Calculated by dividing tangible common equity by shares outstanding.

⁽³⁾ Calculated by dividing annualized net income for each period by average tangible common equity.

⁽⁴⁾ The efficiency ratio is calculated by dividing noninterest expense less amortization of intangibles by the sum of net interest income on a fully taxable equivalent basis plus noninterest income.

	For the Three Months Ended															For the Twelve Months Ended
	December 31,			September 30,			June 30,			March 31,			December 31,			December 31,			December 31,
Yields	2024			2024			2024			2024			2023			2024			2023
Interest-earning assets:
Loans receivable ⁽¹⁾		6.12	%		6.19	%		6.27	%		6.11	%		6.01	%		6.17	%		5.82	%
Investment securities ^{(1) (2)}		3.63	%		3.62	%		3.59	%		3.52	%		3.52	%		3.61	%		3.53	%
Interest-earning deposits with other banks		4.23	%		4.27	%		4.59	%		4.88	%		3.71	%		4.49	%		3.82	%
Total interest-earning assets		5.78	%		5.84	%		5.92	%		5.77	%		5.64	%		5.83	%		5.47	%
Deposits:
Interest-bearing demand deposits		2.07	%		2.16	%		1.93	%		1.86	%		1.67	%		2.01	%		1.32	%
Money market deposits		3.81	%		3.93	%		3.95	%		3.81	%		3.58	%		3.88	%		2.65	%
Savings deposits		0.75	%		0.71	%		0.64	%		0.58	%		0.59	%		0.67	%		0.76	%
Certificates of deposit		4.21	%		4.49	%		4.57	%		4.06	%		3.68	%		4.33	%		2.83	%
Total interest-bearing deposits		3.05	%		3.17	%		3.15	%		2.88	%		2.56	%		3.06	%		1.92	%
Non-Deposit Funding:
Borrowings		4.93	%		5.54	%		5.60	%		5.61	%		5.57	%		5.45	%		5.40	%
Total interest-bearing liabilities		3.21	%		3.41	%		3.45	%		3.23	%		2.96	%		3.33	%		2.28	%
Cost of deposits		2.24	%		2.33	%		2.30	%		2.08	%		1.81	%		2.24	%		1.32	%
Cost of funds		2.41	%		2.58	%		2.61	%		2.42	%		2.18	%		2.51	%		1.62	%
Net interest margin ⁽³⁾		3.56	%		3.46	%		3.51	%		3.54	%		3.63	%		3.52	%		3.97	%

⁽¹⁾ Tax-equivalent adjustments to calculate the yield on tax-exempt securities and loans were determined using an effective tax rate of 21%.

⁽²⁾ Yield is calculated on the basis of amortized cost.

⁽³⁾ Net interest margin represents net interest income as a percentage of average interest-earning assets.

MIDDLEFIELD BANC CORP.
Consolidated Selected Financial Highlights
(unaudited)

	For the Three Months Ended
	December 31,			September 30,			June 30,			March 31,			December 31,
Asset quality data	2024			2024			2024			2024			2023
(Dollar amounts in thousands, unaudited)
Nonperforming assets ⁽¹⁾	$	29,983		$	30,078		$	15,961		$	10,831		$	10,877
Allowance for credit losses		22,447		$	22,526		$	21,795		$	21,069		$	21,693
Allowance for credit losses/total loans		1.48	%		1.50	%		1.46	%		1.41	%		1.47	%
Net charge-offs (recoveries):
Quarter-to-date	$	151		$	1,382		$	(29	)	$	(68	)	$	(117	)
Year-to-date		1,436			1,285			(97	)		(68	)		(31	)
Net charge-offs (recoveries) to average loans, annualized:
Quarter-to-date		0.04	%		0.36	%		(0.01	%)		(0.02	%)		(0.03	%)
Year-to-date		0.10	%		0.11	%		(0.01	%)		(0.02	%)		0.00	%
Nonperforming loans/total loans		1.97	%		2.00	%		1.07	%		0.73	%		0.74	%
Allowance for credit losses/nonperforming loans		74.86	%		74.89	%		136.55	%		194.52	%		199.44	%
Nonperforming assets/total assets		1.62	%		1.62	%		0.87	%		0.60	%		0.60	%

⁽¹⁾ Nonperforming assets consist of nonperforming loans.

MIDDLEFIELD BANC CORP.
GAAP to Non-GAAP Reconciliations

Reconciliation of Common Stockholders' Equity to Tangible Common Equity	For the Three Months Ended
(Dollar amounts in thousands, except per share and share amounts, unaudited)	December 31,		September 30,		June 30,		March 31,		December 31,
	2024		2024		2024		2024		2023
Stockholders' equity	$	210,562	$	210,705	$	206,788	$	205,575	$	205,681
Less goodwill and other intangibles		41,967		42,225		42,482		42,740		42,998
Tangible common equity	$	168,595	$	168,480	$	164,306	$	162,835	$	162,683
Shares outstanding		8,071,905		8,071,032		8,067,144		8,067,144		8,095,252
Tangible book value per share	$	20.88	$	20.87	$	20.37	$	20.18	$	20.10

Reconciliation of Average Equity to Return on Average Tangible Common Equity	For the Three Months Ended															For the Twelve Months Ended
	December 31,			September 30,			June 30,			March 31,			December 31,			December 31,			December 31,
	2024			2024			2024			2024			2023			2024			2023
Average stockholders' equity	$	209,864		$	209,096		$	205,379		$	205,342		$	197,208		$	207,367		$	196,602
Less average goodwill and other intangibles		42,092			42,350			42,607			42,654			42,972			42,479			41,507
Average tangible common equity	$	167,772		$	166,746		$	162,772		$	162,688		$	154,236		$	164,888		$	155,095
Net income	$	4,848		$	2,340		$	4,164		$	4,167		$	3,543		$	15,519		$	17,368
Return on average tangible common equity (annualized)		11.50	%		5.58	%		10.29	%		10.30	%		9.11	%		9.41	%		11.20	%

Reconciliation of Pre-Tax Pre-Provision Income (PTPP)	For the Three Months Ended												For the Twelve Months Ended
	December 31,			September 30,		June 30,		March 31,			December 31,		December 31,		December 31,
	2024			2024		2024		2024			2023		2024		2023
Net income	$	4,848		$	2,340	$	4,164	$	4,167		$	3,543	$	15,519	$	17,368
Add income taxes		995			371		690		769			709		2,825		3,387
Add provision for (recovery of) credit losses		(177	)		2,234		87		(136	)		554		2,008		3,002
PTPP	$	5,666		$	4,945	$	4,941	$	4,800		$	4,806	$	20,352	$	23,757

MIDDLEFIELD BANC CORP.
Average Balance Sheets
(Dollar amounts in thousands, unaudited)

	For the Three Months Ended
	December 31,							December 31,
	2024							2023
	Average				Average			Average				Average
	Balance		Interest		Yield/Cost			Balance		Interest		Yield/Cost
Interest-earning assets:
Loans receivable ⁽¹⁾	$	1,517,051	$	23,308		6.12	%	$	1,454,688	$	22,027		6.01	%
Investment securities ^{(1) (2)}		191,390		1,489		3.63	%		193,289		1,455		3.52	%
Interest-earning deposits with other banks ⁽³⁾		60,241		641		4.23	%		64,989		608		3.71	%
Total interest-earning assets		1,768,682		25,438		5.78	%		1,712,966		24,090		5.64	%
Noninterest-earning assets		88,205							82,364
Total assets	$	1,856,887						$	1,795,330
Interest-bearing liabilities:
Interest-bearing demand deposits	$	216,492	$	1,126		2.07	%	$	222,517	$	935		1.67	%
Money market deposits		393,298		3,768		3.81	%		276,354		2,493		3.58	%
Savings deposits		197,257		373		0.75	%		211,997		317		0.59	%
Certificates of deposit		313,582		3,315		4.21	%		299,427		2,777		3.68	%
Short-term borrowings		93,200		1,128		4.81	%		144,344		2,013		5.53	%
Other borrowings		11,690		173		5.89	%		11,890		179		5.97	%
Total interest-bearing liabilities		1,225,519		9,883		3.21	%		1,166,529		8,714		2.96	%
Noninterest-bearing liabilities:
Noninterest-bearing demand deposits		404,428							422,151
Other liabilities		17,076							9,442
Stockholders' equity		209,864							197,208
Total liabilities and stockholders' equity	$	1,856,887						$	1,795,330
Net interest income			$	15,555						$	15,376
Interest rate spread ⁽⁴⁾						2.57	%						2.68	%
Net interest margin ⁵⁾						3.56	%						3.63	%
Ratio of average interest-earning assets to average interest-bearing liabilities						144.32	%						146.84	%

⁽¹⁾ Tax-equivalent adjustments to calculate the yield on tax-exempt securities and loans were $280 and $282 for the three months ended December 31, 2024 and 2023, respectively.

⁽²⁾ Yield is calculated on the basis of amortized cost.

⁽³⁾ Includes dividends received on restricted stock.

⁽⁴⁾ Interest rate spread represents the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities.

⁽⁵⁾ Net interest margin represents net interest income as a percentage of average interest-earning assets.

	For the Three Months Ended
	December 31,							September 30,
	2024							2024
	Average				Average			Average				Average
	Balance		Interest		Yield/Cost			Balance		Interest		Yield/Cost
Interest-earning assets:
Loans receivable ⁽¹⁾	$	1,517,051	$	23,308		6.12	%	$	1,507,518	$	23,441		6.19	%
Investment securities ^{(1) (2)}		191,390		1,489		3.63	%		191,748		1,490		3.62	%
Interest-earning deposits with other banks ⁽³⁾		60,241		641		4.23	%		63,580		682		4.27	%
Total interest-earning assets		1,768,682		25,438		5.78	%		1,762,846		25,613		5.84	%
Noninterest-earning assets		88,205							88,644
Total assets	$	1,856,887						$	1,851,490
Interest-bearing liabilities:
Interest-bearing demand deposits	$	216,492	$	1,126		2.07	%	$	217,124	$	1,181		2.16	%
Money market deposits		393,298		3,768		3.81	%		362,545		3,583		3.93	%
Savings deposits		197,257		373		0.75	%		198,775		357		0.71	%
Certificates of deposit		313,582		3,315		4.21	%		325,240		3,671		4.49	%
Short-term borrowings		93,200		1,128		4.81	%		113,812		1,575		5.51	%
Other borrowings		11,690		173		5.89	%		11,739		173		5.86	%
Total interest-bearing liabilities		1,225,519		9,883		3.21	%		1,229,235		10,540		3.41	%
Noninterest-bearing liabilities:
Noninterest-bearing demand deposits		404,428							396,456
Other liabilities		17,076							16,703
Stockholders' equity		209,864							209,096
Total liabilities and stockholders' equity	$	1,856,887						$	1,851,490
Net interest income			$	15,555						$	15,073
Interest rate spread ⁽⁴⁾						2.57	%						2.43	%
Net interest margin ⁽⁵⁾						3.56	%						3.46	%
Ratio of average interest-earning assets to average interest-bearing liabilities						144.32	%						143.41	%

⁽¹⁾ Tax-equivalent adjustments to calculate the yield on tax-exempt securities and loans were $280 and $281 for the three months ended December 31, 2024 and September 30, 2024 respectively.

⁽²⁾ Yield is calculated on the basis of amortized cost.

⁽³⁾ Includes dividends received on restricted stock.

⁽⁴⁾ Interest rate spread represents the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities.

⁽⁵⁾ Net interest margin represents net interest income as a percentage of average interest-earning assets.

	For the Twelve Months Ended
	December 31,							December 31,
	2024							2023
	Average				Average			Average				Average
	Balance		Interest		Yield/Cost			Balance		Interest		Yield/Cost
Interest-earning assets:
Loans receivable ⁽¹⁾	$	1,501,138	$	92,566		6.17	%	$	1,410,251	$	81,963		5.82	%
Investment securities ^{(1) (2)}		191,685		5,889		3.61	%		193,816		5,807		3.53	%
Interest-earning deposits with other banks ⁽³⁾		62,463		2,807		4.49	%		66,295		2,531		3.82	%
Total interest-earning assets		1,755,286		101,262		5.83	%		1,670,362		90,301		5.47	%
Noninterest-earning assets		88,358							88,553
Total assets	$	1,843,644						$	1,758,915
Interest-bearing liabilities:
Interest-bearing demand deposits	$	213,647	$	4,293		2.01	%	$	217,662	$	2,870		1.32	%
Money market deposits		348,065		13,498		3.88	%		244,765		6,498		2.65	%
Savings deposits		197,422		1,325		0.67	%		253,962		1,925		0.76	%
Certificates of deposit		326,559		14,147		4.33	%		272,443		7,702		2.83	%
Short-term borrowings		122,506		6,616		5.40	%		101,088		5,386		5.33	%
Other borrowings		11,765		703		5.98	%		11,965		717		5.99	%
Total interest-bearing liabilities		1,219,964		40,582		3.33	%		1,101,885		25,098		2.28	%
Noninterest-bearing liabilities:
Noninterest-bearing demand deposits		399,430							449,102
Other liabilities		16,883							11,326
Stockholders' equity		207,367							196,602
Total liabilities and stockholders' equity	$	1,843,644						$	1,758,915
Net interest income			$	60,680						$	65,203
Interest rate spread ⁽⁴⁾						2.50	%						3.19	%
Net interest margin ⁽⁵⁾						3.52	%						3.97	%
Ratio of average interest-earning assets to average interest-bearing liabilities						143.88	%						151.59	%

⁽¹⁾ Tax-equivalent adjustments to calculate the yield on tax-exempt securities and loans were $1,131 and $1,106 for the twelve months ended December 31, 2024 and 2023, respectively.

⁽²⁾ Yield is calculated on the basis of amortized cost.

⁽³⁾ Includes dividends received on restricted stock.

⁽⁴⁾ Interest rate spread represents the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities.

⁽⁵⁾ Net interest margin represents net interest income as a percentage of average interest-earning assets.

Middlefield Banc Corp. Reports 2024 Twelve-Month Financial Results

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