Key Highlights

  • Diluted EPS of USD 1.25 beat the consensus estimate of USD 1.14, while adjusted diluted EPS was USD 1.26.
  • Net interest income plus non-interest income of USD 106.59 million trailed the consensus Revenue estimate of USD 108.47 million.
  • Deposits rose USD 44.2 million to USD 7.62 billion, while loans fell USD 85.8 million to USD 6.85 billion.
  • Criticized Assets declined USD 45.9 million and net charge offs totaled just USD 0.2 million in the quarter.

First Mid Bancshares, Inc. (NASDAQ:FMBH) reported third quarter 2026 Net Income of USD 33.3 million, or USD 1.25 per diluted share, above a consensus estimate of USD 1.14. Adjusted net income was USD 33.6 million, or USD 1.26 per diluted share. Revenue, measured as net interest income of USD 79.4 million plus non-interest income of USD 27.2 million, came to USD 106.59 million against a consensus estimate of USD 108.47 million. Return on average assets was 1.45%, and Chief Executive Officer Matthew Smith described the period as a record quarter of earnings.

Margin, Fee Income and Credit Quality

Net interest income slipped USD 0.3 million from the second quarter but rose USD 13.0 million, or 19.6%, from a year earlier, aided by organic earning asset growth and the Two Rivers Bank & Trust acquisition. Net interest Margin on a tax equivalent basis was 3.76%, down 3 basis points sequentially as funding costs outpaced a 6 basis point gain in earning asset yield. The average cost of interest-bearing deposits was 2.16%, up 18 basis points.

Non-interest income was USD 27.2 million versus USD 28.8 million in the prior quarter and USD 22.9 million a year earlier. Non-interest expense fell to USD 65.0 million from USD 70.6 million as Two Rivers Acquisition costs dropped to USD 0.4 million from USD 7.1 million. The adjusted efficiency ratio was 56.13% compared with 58.75% a year earlier. Special mention loans fell to USD 101.5 million, substandard loans to USD 131.6 million, and the allowance stood at USD 86.5 million, or 1.26% of loans.

Deals, Securities Sale and Capital

The company announced a pending acquisition of Evergreen Bancshares, Inc., parent of American Bank of Freedom, which management said deepens its presence in Missouri, Illinois and Indiana and positions it to move past USD 10 billion in assets. It also agreed to acquire Winship Farm Management in Putnam, Illinois, adding over 8,600 acres under management over three years. On October 26, 2026 it sold securities yielding 1.51% at a loss of USD 14.8 million, raising USD 175.8 million in cash.

The company projects that reinvestment at higher rates produces an earn back period of less than two years, and the loss is reflected in fourth quarter results. Capital ratios stayed above well capitalized levels, with total capital at 15.79%, common Equity tier 1 at 13.91% and a Leverage Ratio of 11.29%. Tangible Book Value per share slipped USD 0.06, or 0.2%, as a USD 32.3 million rise in unrealized securities losses was largely offset by earnings. A quarterly Dividend of USD 0.26 per share is payable December 1, 2026.

Signposts for the Fourth Quarter

The October securities sale shifts a USD 14.8 million loss into fourth quarter results, which makes that quarter a reference point for the earn back period of under two years. The Evergreen transaction requires a registration statement on Form S-4, Shareholder approval at Evergreen and regulatory approvals, so filing and approval timing are open items.

Loan trends also Warrant tracking, since total loans dropped USD 85.8 million on Commercial Real Estate payoffs tied to a partial Collateral sale. Non-Performing Loans edged up USD 1.8 million to USD 43.1 million, or 0.63% of loans, and the allowance to non-performing loans ratio slipped to 201% from 211%.