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MB Financial in Chicago saw its earnings dip thanks mainly to costs associated with its acquisition of Taylor Capital Group.
October 31 -
Banks on opposite coasts Sterling Bancorp in New York and Banner in Washington are joining the list of institutions teetering on the $10 billion-asset threshold where a slew of new regulation kicks in. The banks' CEOs said they were finally able to peg the expected costs of reaching that size.
November 7 -
The Fed also hit Taylor with a cease-and-desist order and a $3.5 million civil money penalty for its ties to an financial aid firm. Still, industry observers were impressed that deal is still on track.
July 1
MB Financial in Chicago
The $14.6 billion-asset company earned $34.1 million in the fourth quarter, a nearly sevenfold increase from the previous quarter. Earnings per share were 50 cents, falling 2 cents short of a Bloomberg analyst poll.
On a year-over-year basis, MB's profits surged 43%, on revenue generated from its August 2014 acquisition of the $5.9 billion-asset Taylor.
A combination of higher income from interest and fees, coupled with lower merger-related costs, drove the quarterly results.
Noninterest income climbed 37% from the previous quarter, to $83.7 million, thanks to an uptick in mortgage banking revenue. The company reported mortgage banking revenue of $29 million, up 72% from the third quarter, however the increase was largely related to the timing of the merger as the third quarter resulted only included mortgage banking revenue for 44 days. A year earlier, MB reported mortgage banking revenues of just $342,000.
MB was traditionally not a mortgage lender, but Taylor had a national mortgage origination business that lifted its earnings for several years. At the onset of the transaction, MB gave Taylor the option to sell the unit separately. A
Net interest income jumped 25%, to $119.8 million. Total loans grew 1%, to $9.1 billion. The net interest margin expanded 25 basis points, to 3.81%.
Noninterest expenses held steady at about $141 million, as a sharp drop in merger costs compensated for higher salaries and compensation. Merger-related costs fell to $6.5 million from $27.2 million in the third quarter. At the same time, salary and benefit expenses rose 28%, to $83.2 million.
