Midland States Bancorp in Effingham, Ill., has ended loss-share agreements related to two failed banks it acquired.
The $3 billion-asset company said in a press release Monday that it paid $565,000 to the Federal Deposit Insurance Corp. to terminate the agreements. They were tied to assets included in its purchase of Strategic Capital Bank in Champaign, Ill., in 2009 and WestBridge Bank in Chesterfield, Mo., in 2010.
Under the early-termination agreement, Midland States will record a one-time after-tax charge of $225,000 in the fourth quarter. It will have $786,000 in covered residential real estate loans reclassified as noncovered assets during the same period.
The company said eliminating the loss-share agreements will improve its balance sheet flexibility and simplify financial reporting, among other benefits.
DD&F Consulting Group advised the bank on the early termination.