• Middlefield Banc Corp. Reports 2022 Nine Month Financial Results

    来源: Nasdaq GlobeNewswire / 18 10月 2022 15:05:01   America/Chicago

    MIDDLEFIELD, Ohio, Oct. 18, 2022 (GLOBE NEWSWIRE) -- Middlefield Banc Corp. (NASDAQ: MBCN) today reported financial results for the three and nine months ended September 30, 2022.

    2022 Nine Month Financial Highlights (on a year-over-year basis unless noted):

    • Returned $6.6 million of capital to shareholders through dividends and the repurchase of 141,002 shares at an average price of $25.83 per share
    • Net income was $12.2 million, or $2.08 per diluted share, compared to $13.8 million, or $2.19 per diluted share
    • Nine-month pre-tax income benefited from $1.2 million of accelerated net fees associated with the Paycheck Protection Program (“PPP”), compared to $3.1 million in the 2021 nine-month period
    • Year-to-date net income was negatively impacted by $969,000 of one-time expenses associated with the proposed Liberty Bancshares, Inc. merger
    • Net interest margin improved by 24 basis points to 4.02%, compared to 3.78%
    • Total loans were $995.2 million, compared to $981.7 million at December 31, 2021
    • Total loans increased by $46.6 million, or 6.6% annualized from December 31, 2021, without the impact of PPP loan forgiveness
    • Return on average assets was 1.24%, compared to 1.34%
    • Return on average equity was 11.96%, compared to 12.58%
    • Return on average tangible common equity(1) was 13.59%, compared to 14.20%
    • Strong asset quality with nonperforming loans to total loans of 0.37%, compared to 0.67%
    • Allowance for loan losses was 1.46% of total loans, compared to 1.41%
    • Merger with Liberty Bancshares, Inc. on schedule to close during the 2022 fourth quarter

    “2022 is shaping up to be a strong year of core earnings and asset growth. Total loans increased 1.7% from the second quarter and are up 4.0% on a year-over-year basis, without the impact of PPP loan forgiveness. In addition, year-to-date profitability has benefitted from robust asset quality and a higher net interest margin, partially offsetting a $1.9 million year-over-year reduction in PPP fees and nearly $1.0 million of one-time expenses associated with the proposed Liberty Bancshares, Inc. merger,” stated James R. Heslop, II, President and Chief Executive Officer.

    “As we navigate a rising rate and more fluid economic environment, we are focused on supporting the financial needs of our Ohio communities, maintaining strong asset quality, and completing the merger with Liberty Bancshares, Inc. The merger is on track to close during the 2022 fourth quarter and we expect to benefit as a larger bank with total assets of approximately $1.80 billion, strong earnings accretion, and a robust footprint in two of Ohio’s largest and fastest-growing markets,” concluded Mr. Heslop.

    Income Statement

    Net interest income for the nine-month period ended September 30, 2022, was $36.1 million, compared to $36.2 million for the same period last year.  Year-to-date, the net interest margin was 4.02%, compared to 3.78% for the same period last year.  Net interest income for the 2022 third quarter was $12.6 million, compared to $12.5 million for the 2021 third quarter.  The 1.1% increase in net interest income for the 2022 third quarter from the same period in 2021, was largely a result of higher interest income and lower interest expense.  The net interest margin for the 2022 third quarter was 4.23%, compared to 3.90% for the same period of 2021. 

    For the 2022 nine-month period, noninterest income was $4.3 million, compared to $5.7 million for the same period last year. Noninterest income for the 2022 third quarter was $1.5 million, compared to $1.8 million for the same period last year.

    For the 2022 nine-month period, noninterest expense increased 6.5% to $25.7 million, compared to $24.1 million for the same period last year. Operating costs in the 2022 third quarter increased 12.4% to $8.9 million from $7.9 million for the 2021 third quarter. The Company incurred $390,000 during the 2022 third quarter and $969,000 during the 2022 nine-month period of additional operating expenses associated with the proposed Liberty Bancshares, Inc. merger.

    Net income for the 2022 nine-month period, was $12.2 million, or $2.08 per diluted share, compared to $13.8 million, or $2.19 per diluted share for the same period last year. Net income for the 2022 third quarter, was $4.2 million, or $0.73 per diluted share, compared to $5.2 million, or $0.85 per diluted share for the same period last year.

    Balance Sheet

    Total assets at September 30, 2022, decreased slightly to approximately $1.35 billion from $1.37 billion at September 30, 2021. Net loans at September 30, 2022, decreased 1.5% to $980.7 million, compared to $996.0 million at September 30, 2021. Since 2020, Middlefield has helped customers receive $211.6 million of forgiveness payments under the terms of the Paycheck Protection Program, including processing $0.4 million of forgiveness payments during the third quarter of 2022, and $33.1 million of forgiveness payments year-to-date. The balance of PPP loans outstanding at September 30, 2022, was $1.0 million.

    Total deposits at September 30, 2022, were $1.13 billion, compared to $1.20 billion at September 30, 2021. The 5.8% decrease in deposits was primarily due to declines in interest-bearing, time-based, money market and savings accounts, partially offset by increased noninterest-bearing accounts. The investment portfolio was $162.1 million at September 30, 2022, compared with $163.1 million at September 30, 2021.

    Donald L. Stacy, Chief Financial Officer, stated, “The growth we have experienced in our net interest margin throughout 2022 is encouraging, driven by an 18-basis point increase in our yield on earning assets, and a 6-basis point improvement in our cost of funds. As competition for deposits increases, we expect our cost of funds to increase in future periods. Asset quality remains strong across our portfolio, with only $3.7 million of nonperforming loans at September 30, 2022, which is a 45.8% reduction from September 30, 2021, and represents just 0.37% of total loans at the end of the 2022 third quarter. With a higher degree of economic uncertainty, we have maintained a robust allowance for loan losses, which was 1.46% of total loans at September 30, 2022. We believe our strong balance sheet and favorable capital position will allow us to navigate a more challenging economic cycle, while simultaneously allocating capital to support our long-term growth strategies, dividend payment, and share repurchase program.”

    Mr. Stacy continued, “Year-to-date, we have repurchased 141,002 shares of our common stock at a total cost of $3.6 million. This includes 45,638 shares repurchased during the 2022 third quarter at an average price of $26.74 per share at September 30, 2022. We have 246,549 shares remaining under our repurchase program.”

    Stockholders’ Equity and Dividends
    At September 30, 2022, stockholders’ equity was $122.9 million compared to $146.1 million at September 30, 2021. The 15.9% year-over-year decline in stockholders’ equity was primarily due to an increase in the unrealized loss on the available-for-sale investment portfolio as well as the Company’s stock repurchase program. On a per-share basis, shareholders’ equity at September 30, 2022, was $21.30 compared to $24.13 at September 30, 2021.

    At September 30, 2022, tangible stockholders’ equity(1) was $106.6 million, compared to $129.5 million at September 30, 2021. On a per-share basis, tangible stockholders’ equity(1) was $18.48 at September 30, 2022, compared to $21.39 at September 30, 2021.

    Through the 2022 nine-month period, the Company declared cash dividends of $0.51 per share, compared to $0.48 per share for the same period last year.

    At September 30, 2022, the Company had an equity-to-assets ratio of 9.09%, compared to 10.69% at September 30, 2021.

    Asset Quality

    No provision for loan losses was recorded for both the 2022 and 2021 third quarters. There was no provision for loan losses for the 2022 nine-month period versus $900,000 for the same period last year.

    Net charge-offs were $18,000, or 0.01% of average loans, annualized, during the 2022 third quarter, compared to net recoveries of $34,000, or 0.01% of average loans, annualized, at September 30, 2021. Year-to-date net recoveries were $190,000, or 0.02% of average loans, annualized, compared to net charge-offs of $125,000, or 0.02% of average loans, annualized for the nine-months ended September 30, 2021.

    Nonperforming loans at September 30, 2022, were $3.7 million, compared to $6.8 million at September 30, 2021. Nonperforming assets at September 30, 2022, were $10.5 million, compared to $13.9 million at September 30, 2021. The allowance for loan losses at September 30, 2022, stood at $14.5 million, or 1.46% of total loans, compared to $14.2 million, or 1.41% of total loans at September 30, 2021.

    About Middlefield Banc Corp.

    Middlefield Banc Corp., headquartered in Middlefield, Ohio, is the bank holding company of The Middlefield Banking Company, with total assets of $1.35 billion at September 30, 2022. The Bank operates 16 full-service banking centers and an LPL Financial® brokerage office serving Beachwood, Chardon, Cortland, Dublin, Garrettsville, Mantua, Middlefield, Newbury, Orwell, Plain City, Powell, Solon, Sunbury, Twinsburg, and Westerville. The Bank also operates a Loan Production Office in Mentor, Ohio.

    Additional information is available at www.middlefieldbank.bank

    (1)NON-GAAP FINANCIAL MEASURES

    This press release includes disclosure of Middlefield Banc Corp.’s tangible book value per share, return on average tangible equity, and pre-tax, pre-provision for loan losses income, which are financial measures not prepared in accordance with generally accepted accounting principles in the United States (GAAP). A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts that are required to be disclosed by GAAP. Middlefield Banc Corp. believes that these non-GAAP financial measures provide both management and investors a more complete understanding of the underlying operational results and trends and Middlefield Banc Corp.’s marketplace performance. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the numbers prepared in accordance with GAAP. The reconciliations of non-GAAP financial measures are included in the tables following Consolidated Financial Highlights below.

    FORWARD-LOOKING STATEMENTS

    This press release of Middlefield Banc Corp. and the reports Middlefield Banc Corp. files with the Securities and Exchange Commission often contain “forward-looking statements” relating to present or future trends or factors affecting the banking industry and, specifically, the financial operations, markets, and products of Middlefield Banc Corp. These forward-looking statements involve certain risks and uncertainties. There are a number of important factors that could cause Middlefield Banc Corp.’s future results to differ materially from historical performance or projected performance. These factors include, but are not limited to: (1) a significant increase in competitive pressures among financial institutions; (2) changes in the interest rate environment that may reduce interest margins; (3) changes in prepayment speeds, charge-offs and loan loss provisions; (4) less favorable than expected general economic conditions; (5) legislative or regulatory changes that may adversely affect businesses in which Middlefield Banc Corp. is engaged; (6) technological issues which may adversely affect Middlefield Banc Corp.’s financial operations or customers; (7) the effect of the COVID-19 pandemic, including on our credit quality and business operations, as well as its impact on general economic and financial market conditions; (8) changes in the securities markets; (9) the Company’s failure to integrate Liberty Bancshares, Inc. and Liberty National Bank with Middlefield in accordance with expectations and deviations from performance expectations related to Liberty Bancshares, Inc. and Liberty National Bank; or (10) risk factors mentioned in the reports and registration statements Middlefield Banc Corp. files with the Securities and Exchange Commission. Middlefield Banc Corp. undertakes no obligation to release revisions to these forward-looking statements or to reflect events or circumstances after the date of this press release.


    MIDDLEFIELD BANC CORP.               
    Consolidated Selected Financial Highlights               
    (Dollar amounts in thousands, unaudited)                  
    Balance Sheets (period end)  September 30, 2022  June 30,
    2022    		  March 31, 
    2022    		   December 31,
    2021    		   September 30,
    2021    		      
    ASSETS                    
    Cash and due from banks$ 119,777  $ 60,114  $78,804  $ 97,172  $ 113,177       
    Federal funds sold  8,800    19,039   29,474    22,322    19,174       
    Cash and cash equivalents  128,577    79,153   108,278    119,494    132,351       
    Equity securities, at fair value  972    779   851    818    833       
    Investment securities available for sale, at fair value  162,064    171,958   175,216    170,199    163,057       
    Loans held for sale  -    -   9    1,051    676       
    Loans:                    
    Commercial real estate:                    
    Owner occupied  120,912    120,771   113,590    111,470    110,883       
    Non-owner occupied  285,419    288,334   293,745    283,618    310,222       
    Multifamily  38,063    29,152   29,385    31,189    30,762       
    Residential real estate  247,612    246,453   244,747    240,089    232,020       
    Commercial and industrial  146,987    137,398   131,683    148,812    163,052       
    Home equity lines of credit  114,344    111,730   106,300    104,355    105,450       
    Construction and other  33,748    35,988   50,152    54,148    49,378       
    Consumer installment  8,110    8,171   8,118    8,010    8,515       
    Total loans  995,195    977,997   977,720    981,691    1,010,282       
    Less allowance for loan and lease losses  14,532    14,550   14,492    14,342    14,234       
    Net loans  980,663    963,447   963,228    967,349    996,048       
    Premises and equipment, net  16,215    17,030   17,142    17,272    17,507       
    Goodwill  15,071    15,071   15,071    15,071    15,071       
    Core deposit intangibles  1,171    1,249   1,326    1,403    1,484       
    Bank-owned life insurance  17,382    17,274   17,166    17,060    16,954       
    Other real estate owned  6,792    6,792   6,992    6,992    7,090       
    Accrued interest receivable and other assets  22,104    20,624   18,019    14,297    14,794       
    TOTAL ASSETS$ 1,351,011  $ 1,293,377  $1,323,298  $ 1,331,006  $ 1,365,865       
                         
      September 30,   June 30,   March 31,   December 31,  September 30,      
       2022    2022   2022   2021    2021       
    LIABILITIES                    
    Deposits:                    
    Noninterest-bearing demand$ 383,675  $ 379,872  $361,251  $ 334,171  $ 316,770       
    Interest-bearing demand  160,112    154,788   162,010    196,308    237,576       
    Money market  162,052    185,494   187,807    177,281    178,423       
    Savings  247,466    252,179   264,784    260,125    256,114       
    Time  177,182    174,833   191,320    198,725    211,674       
             Total deposits  1,130,487    1,147,166   1,167,172    1,166,610    1,200,557       
                         
      Short-term borrowings   80,000    -   -    -    -       
      Other borrowings   12,107     12,910    12,975     12,901     12,966       
      Accrued interest payable and other liabilities     5,562       5,081      5,507       6,160       6,287       
         TOTAL LIABILITIES  1,228,156    1,165,157   1,185,654    1,185,671    1,219,810       
    STOCKHOLDERS' EQUITY                    
    Common stock, no par value; 10,000,000 shares authorized, 7,350,616                    
    shares issued, 5,767,803 shares outstanding as of September 30, 2022   87,640     87,562    87,562     87,131     87,131       
    Retained earnings   93,166     89,900    86,804     83,971     80,376       
    Accumulated other comprehensive (loss) income     (25,080)      (17,591)   (6,674)      3,462       3,610       
    Treasury stock, at cost;  1,582,813 shares as of September 30, 2022     (32,871)      (31,651)     (30,048)      (29,229)      (25,062)      
         TOTAL STOCKHOLDERS' EQUITY     122,855       128,220      137,644       145,335       146,055       
                         
    TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY$ 1,351,011  $ 1,293,377  $1,323,298  $ 1,331,006  $ 1,365,865       
                         
    MIDDLEFIELD BANC CORP.         
    Consolidated Selected Financial Highlights       
    (Dollar amounts in thousands, unaudited)            
      For the Three Months Ended  For the Nine Months Ended
      September 30,   June 30,   March 31,   December 31,  September 30,  September 30,   September 30,
    Statements of Income  2022    2022   2022   2021    2021   2022  2021
                         
    INTEREST AND DIVIDEND INCOME                    
       Interest and fees on loans$  11,892  $  11,268  $ 10,985  $  11,586  $  12,258  $ 34,145  $ 36,310 
       Interest-earning deposits in other institutions        134            74           24            30            30         232           60 
       Federal funds sold          51            46   3    1    1         100   2 
       Investment securities:                    
          Taxable interest        449          442         443          438          461      1,334      1,241 
          Tax-exempt interest        982          955         784          732          673      2,721      1,833 
       Dividends on stock          59            33           24            23            24         116           79 
          Total interest and dividend income   13,567     12,818    12,263     12,810     13,447    38,648    39,525 
    INTEREST EXPENSE                    
       Deposits        812          709         726          783          915      2,247      3,130 
       Short-term borrowings          44            -             -              -              -             44           -   
       Other borrowings        112            81           69            67            68         262         214 
          Total interest expense        968          790         795          850          983      2,553      3,344 
                         
    NET INTEREST INCOME   12,599     12,028    11,468     11,960     12,464    36,095    36,181 
                         
    Provision for loan losses          -              -             -          (200)           -             -           900 
                         
    NET INTEREST INCOME AFTER PROVISION                    
       FOR LOAN LOSSES   12,599     12,028    11,468     12,160     12,464    36,095    35,281 
    NONINTEREST INCOME                    
       Service charges on deposit accounts     1,004          956         914          906          876      2,874      2,519 
       (Loss) gain on equity securities        (57)         (72)          33          (14)         102         (96)        223 
       Earnings on bank-owned life insurance        108          108         106          106          108         322         440 
       Gains on sale of loans  7            18   3          118          309           28      1,122 
       Revenue from investment services        233          153         141          198          190         527         529 
       Other income        251          220         206          221          236         677         838 
          Total noninterest income     1,546       1,383      1,403       1,535       1,821      4,332      5,671 
                         
    NONINTEREST EXPENSE                    
    Salaries and employee benefits     4,491       3,785      4,386       4,088       4,488    12,662    13,063 
    Occupancy expense        458          583         505          542          426      1,546      1,506 
    Equipment expense        233          274         315          358          333         822      1,003 
    Data processing and information technology costs        985          822         844          851          845      2,650      2,447 
    Ohio state franchise tax        293          292         293          285          287         878         859 
    Federal deposit insurance expense          84            90           50            50          150         224         444 
    Professional fees        280          383         455          435          136      1,118         878 
    Net loss (gain) on other real estate owned  1          206   8          (66)   9         215           77 
    Advertising expense        268          229         228          221          222         725         664 
    Software amortization expense          27            40           48          119            88         115         242 
    Core deposit intangible amortization          78            77           77            80            81         232         241 
    Merger-related costs        390          579           -              -              -           969           -   
    Other expense     1,298       1,175      1,057          868          842      3,531      2,694 
          Total noninterest expense     8,886       8,535      8,266       7,831       7,907    25,687    24,118 
                         
    Income before income taxes     5,259       4,876      4,605       5,864       6,378    14,740    16,834 
    Income taxes     1,010          787         772       1,027       1,174      2,569      3,038 
                         
    NET INCOME$    4,249  $    4,089  $   3,833  $    4,837  $    5,204  $ 12,171  $ 13,796 
                         
    PTPP (1)$    5,259  $    4,876  $   4,605  $    5,664  $    6,378  $ 14,740  $ 17,734 
                         
    (1)  The pre-tax pre-provision (PTPP) is the income before income taxes before provision for loan losses considerations, for reconciliation of non-GAAP measures.
                         
    MIDDLEFIELD BANC CORP.               
    Consolidated Selected Financial Highlights               
    (Dollar amounts in thousands, except per share and share amounts, unaudited)      
      For the Three Months Ended  For the Nine Months Ended
      September 30,   June 30,   March 31,   December 31,  September 30,  September 30,   September 30,
      2022  2022  2022  2021  2021  2022  2021
    Per common share data                    
    Net income per common share - basic$ 0.73  $ 0.70   $ 0.65   $  0.81   $  0.85   $ 2.08   $ 2.20 
    Net income per common share - diluted$ 0.73  $ 0.70   $ 0.65   $  0.81   $  0.85   $ 2.08   $ 2.19 
    Dividends declared per share $  0.17  $ 0.17   $ 0.17   $  0.21   $  0.16   $ 0.51   $ 0.48 
    Book value per share (period end)$ 21.30  $ 22.07   $ 23.43   $  24.68   $  24.13   $ 21.30   $ 24.13 
    Tangible book value per share (period end) (2) (3)$ 18.48  $ 19.26   $ 20.64   $  21.88   $  21.39   $ 18.48   $ 21.39 
    Dividends declared $        983  $       993   $    1,000   $     1,242   $        978   $ 2,976   $ 2,998 
    Dividend yield  2.49%   2.71%  2.78%   3.37%   2.66%  2.52%  2.69%
    Dividend payout ratio  23.13%   24.28%  26.09%   25.68%   18.79%  24.45%  21.73%
    Average shares outstanding - basic  5,792,773    5,851,422   5,879,025    5,951,838    6,136,648   5,840,757   6,265,803 
    Average shares outstanding - diluted  5,805,799    5,860,098   5,889,836    5,975,333    6,157,181   5,853,783   6,287,556 
    Period ending shares outstanding  5,767,803    5,810,351   5,873,565    5,888,737    6,054,083   5,767,803   6,054,083 
                         
    Selected ratios                    
    Return on average assets  1.32%   1.25%  1.17%   1.41%   1.51%  1.24%  1.34%
    Return on average equity  12.94%   12.30%  10.75%   13.17%   13.95%  11.96%  12.58%
    Return on average tangible common equity (2) (4)  14.79%   14.02%  12.13%   14.85%   15.71%  13.59%  14.20%
    Efficiency (1)  61.07%   61.83%  62.54%   56.56%   54.05%  61.79%  56.42%
    Equity to assets at period end  9.09%   9.91%  10.40%   10.92%   10.69%  9.09%  10.69%
    Noninterest expense to average assets  0.69%   0.65%  0.62%   0.58%   0.58%  1.96%  1.75%
                         
    (1)  The efficiency ratio is calculated by dividing noninterest expense less amortization of intangibles by the sum of net interest income on a fully taxable equivalent basis plus noninterest income
    (2)  See reconciliation of non-GAAP measures below         
    (3)  Calculated by dividing tangible common equity by shares outstanding 
    (4)  Calculated by dividing annualized net income for each period by average tangible common equity      
                         
    MIDDLEFIELD BANC CORP.               
    Consolidated Selected Financial Highlights         
    (Unaudited)               
      For the Three Months Ended  For the Nine Months Ended
      September 30,   June 30,   March 31,   December 31,  September 30,  September 30,   September 30,
    Yields  2022   2022  2022   2021    2021   2022  2021
    Interest-earning assets:                    
      Loans receivable (2)  4.78%   4.66%  4.53%   4.61%   4.74%  4.66%  4.54%
      Investment securities (2)  3.90%   3.76%  3.41%   3.30%   3.37%  3.69%  3.51%
      Interest-earning deposits with other banks  2.06%   0.77%  0.23%   0.20%   0.21%  0.82%  0.20%
    Total interest-earning assets  4.55%   4.28%  4.06%   4.07%   4.20%  4.30%  4.12%
    Deposits:                    
      Interest-bearing demand deposits  0.22%   0.15%  0.14%   0.12%   0.12%  0.17%  0.13%
      Money market deposits  0.46%   0.49%  0.47%   0.47%   0.46%  0.47%  0.47%
      Savings deposits  0.19%   0.06%  0.06%   0.06%   0.06%  0.10%  0.06%
      Certificates of deposit  0.96%   0.83%  0.87%   0.90%   1.08%  0.89%  1.19%
    Total interest-bearing deposits  0.43%   0.36%  0.37%   0.36%   0.41%  0.39%  0.47%
    Non-Deposit Funding:                    
      Borrowings  2.94%   2.51%  2.16%   2.09%   2.08%  2.61%  1.14%
    Total interest-bearing liabilities  0.50%   0.39%  0.39%   0.37%   0.44%  0.43%  0.48%
    Cost of deposits  0.29%   0.24%  0.25%   0.26%   0.30%  0.26%  0.35%
    Cost of funds  0.34%   0.27%  0.27%   0.27%   0.31%  0.29%  0.35%
    Net interest margin (1)  4.23%   4.02%  3.80%   3.82%   3.90%  4.02%  3.78%
                         
    (1) Net interest margin represents net interest income as a percentage of average interest-earning assets.   
    (2) Tax-equivalent adjustments to calculate the yield on tax-exempt securities and loans were determined using an effective tax rate of 21%.            
                         
      For the Three Months Ended      
      September 30,   June 30,   March 31,   December 31,  September 30,      
    Asset quality data  2022    2022   2022   2021    2021       
    (Dollar amounts in thousands, unaudited)                    
    Nonperforming loans (1)$    3,692  $    4,670  $   4,728  $    4,859  $    6,806       
    Other real estate owned     6,792       6,792      6,992       6,992       7,090       
    Nonperforming assets$  10,484  $  11,462  $ 11,720  $  11,851  $  13,896       
                         
    Allowance for loan losses$ 14,532  $ 14,550  $14,492  $ 14,342  $ 14,234       
    Allowance for loan losses/total loans  1.46%   1.49%  1.48%   1.46%   1.41%      
    Net charge-offs (recoveries):                    
       Quarter-to-date$         18  $       (58) $    (150) $ (308) $ (34)      
       Year-to-date  (190)   (208)  (150)   (183)   125       
    Net charge-offs (recoveries) to average loans, annualized:                    
       Quarter-to-date  0.01%   -0.02%  -0.06%   -0.12%   -0.01%      
       Year-to-date  -0.02%   -0.04%  -0.06%   -0.02%   0.02%      
                         
    Nonperforming loans/total loans  0.37%   0.48%  0.48%   0.49%   0.67%      
    Allowance for loan losses/nonperforming loans  393.61%   311.56%  306.51%   295.16%   209.14%      
    Nonperforming assets/total assets  0.78%   0.89%  0.89%   0.89%   1.02%      
    (1) Nonperforming loans exclude troubled debt restructurings that are performing in accordance with their terms over a prescribed period of time.  
                         
    Reconciliation of Common Stockholders' Equity to Tangible Common Equity                    
    For the Three Months Ended      
    (Dollar amounts in thousands, unaudited) September 30,   June 30,   March 31,   December 31,  September 30,      
       2022    2022   2022   2021    2021       
                         
    Stockholders' Equity$    122,855  $    128,220  $   137,644  $    145,335  $    146,055       
    Less Goodwill and other intangibles   16,242     16,320    16,397     16,474     16,555       
    Tangible Common Equity$    106,613  $    111,900  $   121,247  $    128,861  $    129,500       
                         
    Shares outstanding  5,767,803    5,810,351   5,873,565    5,888,737    6,054,083       
    Tangible book value per share$    18.48  $    19.26  $   20.64  $    21.88  $    21.39       
                         
    Reconciliation of Average Equity to Return on Average Tangible Common Equity                    
    For the Three Months Ended  For the Nine Months Ended
                         
      September 30,   June 30,   March 31,   December 31,  September 30,  September 30,   September 30,
       2022    2022   2022   2021    2021   2022  2021
                         
    Average Stockholders' Equity $    130,263  $    133,377  $   144,630  $    145,716  $    148,048  $   136,090  $   146,611 
    Less Average Goodwill and other intangibles   16,280     16,357    16,435     16,513     16,594    16,357    16,674 
    Average Tangible Common Equity$    113,983  $    117,020  $   128,195  $    129,203  $    131,454  $   119,733  $   129,937 
                         
    Net income$    4,249  $    4,089  $   3,833  $    4,837  $    5,204  $ 12,171  $ 13,796 
    Return on average tangible common equity (annualized)  14.79%   14.02%  12.13%   14.85%   15.71%  13.59%  14.20%
                         
    Reconciliation of Pre-Tax Pre-Provision Income (PTPP)                    
    For the Three Months Ended  For the Nine Months Ended
                         
      September 30,   June 30,   March 31,   December 31,  September 30,  September 30,   September 30,
       2022    2022   2022   2021   2021   2022  2021
                         
    Net income$    4,249  $    4,089  $   3,833  $    4,837  $    5,204  $ 12,171  $ 13,796 
    Add Income Taxes     1,010          787         772       1,027       1,174      2,569      3,038 
    Add Provision for loan losses  -    -   -        (200)   -   -         900 
    PTPP$    5,259  $    4,876  $   4,605  $    5,664  $    6,378  $ 14,740  $ 17,734 
                         
    MIDDLEFIELD BANC CORP.               
    Average Balance Sheets                 
    (Dollar amounts in thousands, unaudited)            
      For the Three Months Ended   
      September 30,   September 30,    
       2022    2021    
      Average     Average  Average     Average   
      Balance  Interest   Yield/Cost  Balance  Interest   Yield/Cost   
    Interest-earning assets:                    
    Loans receivable (3) $987,689   $11,892   4.78%  $1,027,935   $12,258   4.74%   
    Investment securities (3)     172,316    1,431   3.90%      154,718    1,134   3.37%   
    Interest-earning deposits with other banks (4)   46,938    244   2.06%      105,910    55   0.21%   
    Total interest-earning assets  1,206,943     13,567   4.55%   1,288,563     13,447   4.20%   
    Noninterest-earning assets   73,753           82,952          
    Total assets $1,280,696         $1,371,515          
    Interest-bearing liabilities:                    
      Interest-bearing demand deposits $ 162,878   $      91   0.22%  $ 225,264   $      67   0.12%   
      Money market deposits     155,095          180   0.46%      182,831          214   0.46%   
      Savings deposits     249,898          119   0.19%      253,960            38   0.06%   
      Certificates of deposit     174,091          422   0.96%      218,323          596   1.08%   
      Short-term borrowings     8,554            44   2.04%   -    -   0.00%   
      Other borrowings   12,530          112   3.55%    12,999            68   2.08%   
    Total interest-bearing liabilities     763,046          968   0.50%      893,377          983   0.44%   
    Noninterest-bearing liabilities:                    
      Noninterest-bearing demand deposits     382,351             323,726          
      Other liabilities     5,036             6,364          
    Stockholders' equity     130,263             148,048          
    Total liabilities and stockholders' equity $          1,280,696         $          1,371,515          
    Net interest income    $   12,599         $   12,464       
    Interest rate spread (1)       4.05%        3.76%   
    Net interest margin (2)       4.23%        3.90%   
    Ratio of average interest-earning assets to                    
      average interest-bearing liabilities       158.17%        144.24%   
                         
    (1) Interest rate spread represents the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities.
    (2) Net interest margin represents net interest income as a percentage of average interest-earning assets.
    (3) Tax-equivalent adjustments to calculate the yield on tax-exempt securities and loans were $277 and $195 for the three months ended September 30, 2022 and 2021, respectively      
    (4) Includes dividends received on restricted stock.      
                         
      For the Three Months Ended   
      September 30,   June 30,    
       2022    2022    
      Average     Average  Average     Average   
      Balance  Interest   Yield/Cost  Balance  Interest   Yield/Cost   
    Interest-earning assets:                    
      Loans receivable (3) $ 987,689   $   11,892   4.78%  $ 970,820   $   11,268   4.66%   
      Investment securities (3)     172,316       1,431   3.90%      176,138    1,397   3.76%   
      Interest-earning deposits with other banks (4)   46,938          244   2.06%    79,924    153   0.77%   
    Total interest-earning assets  1,206,943     13,567   4.55%   1,226,882     12,818   4.28%   
    Noninterest-earning assets   73,753           89,555          
    Total assets $1,280,696         $1,316,437          
    Interest-bearing liabilities:                    
      Interest-bearing demand deposits $ 162,878   $      91   0.22%  $ 159,779   $      59   0.15%   
      Money market deposits     155,095          180   0.46%      185,711          228   0.49%   
      Savings deposits     249,898          119   0.19%      260,226            40   0.06%   
      Certificates of deposit     174,091          422   0.96%      184,748          382   0.83%   
      Short-term borrowings     8,554            44   2.04%   -    -   0.00%   
      Other borrowings   12,530          112   3.55%    12,945            81   2.51%   
    Total interest-bearing liabilities     763,046          968   0.50%      803,409          790   0.39%   
    Noninterest-bearing liabilities:                    
      Noninterest-bearing demand deposits     382,351             375,013          
      Other liabilities     5,036             4,638          
    Stockholders' equity     130,263             133,377          
    Total liabilities and stockholders' equity $1,280,696         $1,316,437          
    Net interest income    $   12,599         $   12,028       
    Interest rate spread (1)       4.05%        3.89%   
    Net interest margin (2)       4.23%        4.02%   
    Ratio of average interest-earning assets to average interest-bearing liabilities       158.17%        152.71%   
                         
    (1) Interest rate spread represents the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities.
    (2) Net interest margin represents net interest income as a percentage of average interest-earning assets.
    (3) Tax-equivalent adjustments to calculate the yield on tax-exempt securities and loans were $277 and $271 for the three months ended September 30, 2022, and June 30, 2022, respectively.
    (4) Includes dividends received on restricted stock.     
                         
      For the Nine Months Ended   
      September 30,   September 30,    
       2022    2021    
      Average     Average  Average     Average   
      Balance  Interest  Yield/Cost  Balance  Interest  Yield/Cost   
    Interest-earning assets:                    
    Loans receivable (3) $980,787   $34,145   4.66%  $1,070,058   $36,310   4.54%   
    Investment securities (3)  173,094    4,055   3.69%   135,522    3,074   3.51%   
    Interest-earning deposits with other banks (4)  72,851    448   0.82%   94,955    141   0.20%   
    Total interest-earning assets  1,226,732    38,648   4.30%   1,300,535    39,525   4.12%   
    Noninterest-earning assets  82,733          74,883          
    Total assets $1,309,465         $1,375,418          
    Interest-bearing liabilities:                    
    Interest-bearing demand deposits $164,337   $210   0.17%  $211,797   $209   0.13%   
    Money market deposits  175,024    620   0.47%   187,945    655   0.47%   
    Savings deposits  256,762    197   0.10%   254,574    123   0.06%   
    Certificates of deposit  184,165    1,220   0.89%   240,582    2,143   1.19%   
    Short-term borrowings  2,851    44   2.06%   113    -   0.00%   
    Other borrowings  12,806    262   2.74%   13,440    214   2.13%   
    Total interest-bearing liabilities  795,945    2,553   0.43%   908,451    3,344   0.49%   
    Noninterest-bearing liabilities:                    
    Noninterest-bearing demand deposits  372,343          314,172          
    Other liabilities  5,087          6,184          
    Stockholders' equity  136,090          146,611          
    Total liabilities and stockholders' equity $1,309,465         $1,375,418          
    Net interest income    $36,095         $36,181       
    Interest rate spread (1)       3.87%        3.63%   
    Net interest margin (2)       4.02%        3.78%   
    Ratio of average interest-earning assets to                    
    average interest-bearing liabilities       154.12%        143.16%   
                         
    (1) Interest rate spread represents the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities.   
    (2) Net interest margin represents net interest income as a percentage of average interest-earning assets.   
    (3) Tax-equivalent adjustments to calculate the yield on tax-exempt securities and loans were $768 and $542 for the nine months ended September 30, 2022 and 2021, respectively.
    (4) Includes dividends received on restricted stock.         
                         
                         
                         
    Quarterly Calculations      
                         
    Average shares outstanding - basic  5,792,773    5,851,422   5,879,025    5,951,838    6,136,648       
    Average shares outstanding -diluted  5,805,799    5,860,098   5,889,836    5,975,333    6,157,181       
    Period ending shares outstanding  5,767,803    5,810,351   5,873,565    5,888,737    6,054,083       
    Stock price at end of period$    27.10   $     25.20   $    24.82   $     24.82   $     23.83       
                         
     For the Three Months Ended      
      September 30,   June 30,   March 31,   December 31,  September 30,      
       2022    2022   2022   2021    2021       
                         
    Average Loans     987,689       970,820      983,853       999,229    1,027,935       
    Average Assets  1,280,696    1,316,437   1,332,039    1,358,843    1,371,515       
    Goodwill   15,071     15,071    15,071     15,071     15,071       
    Average Assets less goodwill  1,265,625    1,301,366   1,316,968    1,343,772    1,356,444       
                         
    Average Equity     130,263       133,377      144,630       145,716       148,048       
    Average Goodwill   15,071     15,071    15,071     15,071     15,071       
    Average Core deposit intangible     1,209       1,286      1,364       1,442       1,523       
    Average MSR Reserves                    
    Average Tangible equity     113,983       117,020      128,195       129,203       131,454       
    Annualized Net Income   16,857     16,401    15,545     19,190     20,646       
    Net Interest Income (TE)   12,876     12,297    11,691     12,170     12,690       
    Non Interest Income     1,546       1,383      1,403       1,535       1,821       
    Total   14,422     13,680    13,094     13,705     14,511       
                         
    Non Interest Expense     8,886       8,535      8,266       7,831       7,907       
    amort of intangibles          78            77           77            80            81       
    Non Interest Expense for Efficiency     8,808       8,458      8,189       7,751       7,826       
                         
    Net Interest Income   12,599     12,028    11,468     11,960     12,464       
    Tax free income        277          269         223          210          195       
    Net Interest Income (TE)   12,876     12,297    11,691     12,170     12,659       
                         
    Equity period end     122,855       128,220      137,644       145,335       146,055       
    Goodwill   15,071     15,071    15,071     15,071     15,071       
    Core deposit intangible     1,171       1,249      1,326       1,403       1,484       
    MSR Reserves                    
    Tangible equity     106,613       111,900      121,247       128,861       129,500       
    Tangible book value per share     18.48       19.26      20.64       21.88       21.39       
    Period ending shares outstanding  5,767,803    5,810,351   5,873,565    5,888,737    6,054,083       
    Equity to assets at period end  9.09%   9.91%  10.40%   10.92%   10.69%      
    Assets at period end  1,351,011    1,293,377   1,323,298    1,331,006    1,365,865       
                         
    LLR Beginning of year   14,342     14,342    14,342     13,459     13,459       
    YTD Allocation          -              -             -            700          900       
        14,342     14,342    14,342     14,159     14,359       
    Current LLR balance   14,532     14,550    14,492     14,342     14,234       
    Net (recoveries) chargeoffs YTD      (190)       (208)      (150)       (183)         125       
                         
    LLR Beginning of Quarter   14,550     14,492    14,342     14,234     14,200       
    QTD Allocation          -              -             -          (200)           -         
        14,550     14,492    14,342     14,034     14,200       
    Current LLR balance   14,532     14,550    14,492     14,342     14,234       
    Net (recoveries) chargeoffs QTD          18          (58)      (150)       (308)         (34)      
                         
    Total Loans     995,195       977,997      977,720       981,691    1,010,282       
    OREO     6,792       6,792      6,992       6,992       7,090       
    Loans and OREO  1,001,987       984,789      984,712       988,683    1,017,372       
    Non performing assets   10,484     11,462    11,720     11,851     13,896       
       1.05%   1.16%  1.19%   1.20%   1.37%      
                         
    Tier 1 capital     139,693       137,491      135,921       130,652       133,890       
    Average assets  1,280,696    1,316,437   1,332,039    1,358,843    1,371,515       
                         


    Company Contact:Investor and Media Contact:
    James Heslop
    President/Chief Executive Officer
    Middlefield Banc Corp.
    (440) 632-1666 Ext. 3219
    JHeslop@middlefieldbank.com    		Andrew M. Berger
    Managing Director
    SM Berger & Company, Inc.
    (216) 464-6400
    andrew@smberger.com

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