First Mid Bancshares, Inc.

What they do

The Company is a Delaware corporation incorporated in 1981 and is a financial holding company engaged in banking through its wholly owned subsidiary, First Mid Bank & Trust, N.A. It offers insurance products and services through First Mid Insurance Group, Inc. and trust, farm services, investment services, and retirement planning through First Mid Wealth Management Company. It also wholly owns a captive insurance company, First Mid Captive, Inc., and an investment subsidiary, First Mid Investments, Inc. It operates five unconsolidated statutory business trusts.

Revenue drivers

• Net interest income — The largest revenue source: $256.2 million in 2025, up from $228.7 million in 2024, driven by net interest margin expansion to 3.70% (tax effected) from 3.34%.
• Non-interest income — $93.1 million in 2025 versus $96.3 million in 2024; the 2025 decrease was primarily due to losses recognized on the sale of low-performing securities in the investment portfolio.
• Insurance commissions — Generated through First Mid Insurance Group, Inc.; commissions increased in 2024 partly from the acquisition of Mid Rivers Insurance Group, Inc.
• Wealth management services — Trust, farm services, investment services, and retirement planning are provided through First Mid Wealth Management Company, a wholly owned subsidiary.

Recent performance

For the second quarter of 2026, net income was $27.8 million, or $1.04 diluted EPS, with adjusted quarterly net income of $33.4 million, or $1.26 diluted EPS. Net interest income was $79.7 million, up $8.9 million from the first quarter of 2026 and up 24.7% from the second quarter of 2025. Net interest margin, tax equivalent, was 3.79% for the second quarter of 2026, a 1 basis point increase over the prior quarter. Total loans ended the quarter at $6.93 billion, a $9.9 million decrease, and total deposits were $7.57 billion, a $23.9 million quarterly increase. For the six months ended June 30, 2026, net income was $54.1 million, or $2.10 diluted EPS, versus $45.6 million, or $1.90, in the first half of 2025.

Strategy

The Company completed the merger of Two Rivers Bank & Trust into First Mid Bank & Trust during the second quarter of 2026. It repurchased 21,872 shares and the Board of Directors declared a $0.01 increase in the quarterly dividend to $0.26 per share. Management cited opportunistic share repurchases, the dividend increase, and paying off higher cost subordinated debt as uses of capital. For 2025, growth in net loan balances was primarily due to organic growth within the established footprint, and deposit growth was primarily due to increases in CDs, brokered CDs, and non-interest bearing deposits. The 2024 deposit decrease reflected a strategy to reduce cost of funds through a reduction in brokered CDs and purchased CDs.

Risks

• Agricultural credit migration — Substandard loans increased $30.8 million to $139.9 million in the second quarter of 2026, primarily from downgrades in the agricultural segment driven by strained cash flows.
• Two Rivers integration risk — The Company incurred nonrecurring expenses tied to the Two Rivers integration, and filings note the possibility that anticipated benefits may not be realized within the expected time period.
• Loan balance contraction — Total loans decreased $9.9 million in the second quarter of 2026 on elevated payoffs and disciplined pricing decisions, with declines in multifamily residential properties and agricultural operating loans.
• Interest rate and deposit pricing pressure — The average cost of funds increased 8 basis points in the second quarter of 2026 with additional months from Two Rivers and overall deposit pricing competition.

Outlook

The company does not provide specific earnings guidance in the excerpts. Management characterized the second quarter of 2026 as a record high quarter of earnings with a successful Two Rivers integration and said it continued to deploy capital to build long-term shareholder value. CEO Matthew Smith stated the employees and customers of Two Rivers have embraced the company and expressed excitement about the future.