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MP

MID PENN BANCORP INC (MPB)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 delivered a clean beat on earnings and revenue: Primary EPS was $0.77 vs S&P consensus $0.71 (+$0.06) and revenue was $62.25M vs $58.40M consensus (+$3.85M). The company also reported GAAP diluted EPS of $0.79 and highlighted the consensus beat in its release.*
  • Net interest margin expanded 16 bps sequentially to 3.60% and 47 bps YoY, driven by repricing, disciplined loan pricing, accretion from acquired loans, and modest declines in deposit funding costs.
  • Operating leverage improved: core efficiency ratio fell to 58.80% from 62.56% in Q2 and 64.89% last year, as noninterest expense dropped materially with the absence of Q2 merger costs and noninterest income increased.
  • Strategic actions and catalysts: dividend increased 10% to $0.22; signed agreements to acquire 1st Colonial Bancorp ($101M deal) and Cumberland Advisors ($3.3B AUM), expanding footprint and fee income potential.
  • Balance sheet mix shift: deposits decreased $106.9M as MPB exited ~$175M brokered CDs (with $279K swap cancellation gains), while interest-bearing transaction balances rose $85.3M; loans declined modestly due to elevated CRE payoffs.

Note: Values marked with an asterisk were retrieved from S&P Global.

What Went Well and What Went Wrong

What Went Well

  • EPS/revenue beat with margin expansion: “Our net interest margin expanded by 16 basis points within the quarter and is now up to 3.6%... Good revenue growth + good NIM expansion + flat operating expenses + solid asset quality = a great quarter.”
  • Asset quality remained strong: net charge-offs were ~$91K (<0.002% of average loans), and nonperforming assets decreased slightly vs Q2; ACL/loans at 0.77%.
  • Efficiency improved: core efficiency ratio decreased 377 bps QoQ to 58.80%, reflecting higher NII, higher noninterest income, and lower noninterest expense as Q2 merger charges rolled off.

What Went Wrong

  • Organic loan contraction: loans declined $11.8M in Q3 (1.0% annualized) and organic loan portfolio was down $53.3M YTD excluding acquisitions, largely due to CRE payoffs outpacing originations.
  • Deposit outflows linked to strategy: total deposits fell $106.9M in Q3 as MPB exited ~$175M brokered CDs; noninterest-bearing balances fell $20.7M even as interest-bearing transactions rose $85.3M.
  • Slight uptick in delinquency: loans past due 30+ days rose to 0.68% from 0.58% in Q2; nonperforming assets remain elevated vs last year (0.44% of assets vs 0.32% in Q3 2024).

Financial Results

Income Statement and EPS vs prior periods and estimates

MetricQ3 2024Q2 2025Q3 2025
Net Interest Income ($USD Millions)$40.17 $48.21 $53.63
Noninterest Income ($USD Millions)$5.18 $6.14 $8.18
Company “Revenue” (NII + Noninterest) ($USD Millions)$45.35 $54.35 $61.81
S&P Revenue Actual ($USD Millions)*N/AN/A$62.25*
S&P Revenue Consensus ($USD Millions)*N/AN/A$58.40*
GAAP Diluted EPS ($)$0.74 $0.22 $0.79
Adjusted EPS ($)$0.75 $0.70 $0.77
S&P Primary EPS Actual ($)*N/AN/A$0.77*
S&P Primary EPS Consensus ($)*N/AN/A$0.71*

Note: Values marked with an asterisk were retrieved from S&P Global.

Margins and Profitability

MetricQ3 2024Q2 2025Q3 2025
Tax-Equivalent Net Interest Margin (%)3.13 3.44 3.60
Core Efficiency Ratio (%)64.89 62.56 58.80
Return on Average Assets (%)0.89 0.32 1.14
Return on Average Equity (%)8.66 2.85 9.26

Balance Sheet and Asset Quality KPIs

MetricQ3 2024Q2 2025Q3 2025
Loans, net of unearned ($USD Billions)$4.432 $4.833 $4.821
Total Deposits ($USD Billions)$4.707 $5.450 $5.343
ACL on Loans to Total Loans (%)0.80 0.78 0.77
Nonperforming Loans / Total Loans (%)0.39 0.38 0.37
Nonperforming Assets / Total Assets (%)0.32 0.44 0.44
30+ Day Delinquencies (%)0.61 0.58 0.68

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Dividend per common share ($)Q3 2025$0.20 (Q2 2025) $0.22 Raised 10%
Loan Growth (directional)FY 2025Expected bottom end of original target range by year-end (no numeric range) No update in Q3 release; still cautious given CRE payoffs Maintained directional commentary
Formal Revenue/EPS GuidanceFY/Q4 2025None providedNone providedN/A

Earnings Call Themes & Trends

Note: A Q3 2025 earnings call transcript was not available in our document set; table below reflects management prepared remarks across quarters and prior release commentary.

TopicPrevious Mentions (Q1 2025, Q2 2025)Current Period (Q3 2025)Trend
Net interest margin trajectoryQ1: NIM up to 3.37% on lower deposit costs post Fed cuts; Q2: NIM 3.44%, continued improvement from funding mix and acquired lower-cost deposits. NIM rose to 3.60% (+16 bps QoQ), aided by repricing, disciplined loan pricing, accretion and modest deposit cost declines. Improving
Deposit strategy/cost of fundsQ1: Focus on stability and competitive rates; cost of funds down to 2.48%. Exited ~$175M brokered CDs; swap cancellation gains $279K; average deposit costs down to 2.37%. Optimizing mix; lowering costs
Loan demand/organic growthQ1: Moderate growth; Q2: organic loans -$89.6M amid CRE runoff; expect bottom end of growth target. Loans down $11.8M in Q3; organic portfolio -$53.3M YTD ex-acquisitions due to CRE payoffs exceeding originations. Soft demand; runoff headwinds
Asset qualityQ1/Q2: Solid; ACL ~0.78–0.80%; NPA increased with acquired nonaccruals. Net charge-offs <$100K; NPA down slightly vs Q2; ACL/loans 0.77%. Strong; stable to improving
M&A/strategic expansionQ2: Closed William Penn; acquired Charis Insurance. Announced 1st Colonial ($101M) and Cumberland Advisors ($3.3B AUM) acquisitions. Expanding footprint/fees
Technology/cybersecurityQ2: Higher software/data security costs with larger scale. Continued IT investments; licensing additional branches and upgrades. Ongoing investment

Management Commentary

  • “Our net interest margin expanded by 16 basis points within the quarter and is now up to 3.6%... Good revenue growth + good NIM expansion + flat operating expenses + solid asset quality = a great quarter of performance for Mid Penn.” — Rory G. Ritrievi, CEO
  • “Annualized revenues for 3Q25 were $247.2 million, versus annualized revenues for 2Q25 of $217.2 million... Solid revenue expansion.”
  • “When excluding M&A costs incurred in 2Q25, noninterest expenses were basically flat... core efficiency ratio... declined from 62.6% in 2Q25 to 58.8% in 3Q25.”
  • “We delivered solid GAAP earnings of $0.80... compared to consensus estimate of $0.71 per share, 3Q24 of $0.74 per share and 2Q25 of $0.22 per share.”

Q&A Highlights

  • The Q3 2025 earnings call transcript was not available in our document set or company filings; no Q&A themes could be extracted at this time. Conference call scheduling references appeared in third-party sites, but no transcript was accessible.

Estimates Context

  • EPS: S&P Primary EPS actual $0.77 vs consensus $0.71; beat by $0.06.*
  • Revenue: S&P revenue actual $62.25M vs consensus $58.40M; beat by ~$3.85M.*
  • Number of estimates: 2 for EPS and revenue in the quarter.*

Note: Values retrieved from S&P Global.

Key Takeaways for Investors

  • Earnings quality: Margin-driven beat with strong asset quality and operating discipline; the absence of Q2 merger costs amplified core efficiency gains.
  • Funding mix optimization: Proactive exit of brokered CDs and swap unwinds reduced funding costs while preserving transactional deposit growth.
  • Organic growth challenge: CRE payoffs and subdued demand are tempering loan growth; watch for pipeline recovery and post-M&A synergies to offset runoff.
  • Strategic M&A adds optionality: 1st Colonial should bolster market presence; Cumberland Advisors adds ~$3.3B AUM and fee income potential near-term. Deal timing/approvals are key milestones.
  • Capital and dividend signal: 10% dividend hike alongside well-capitalized ratios supports shareholder return continuity; buyback capacity remains (~$2.9M).
  • Near-term trading catalyst: Estimate beats and NIM expansion, plus dividend raise and M&A announcements, are positive sentiment drivers; monitor any updates on closing timelines/terms.
  • Medium-term thesis: Sustain NIM resilience and efficiency while stabilizing organic loans; realize fee growth from RIA and cross-sell; maintain credit discipline amid CRE normalization.