Mid Penn Bancorp's Q3 Net Income Jumps 49% on Strong Net Interest Growth

TL;DR

**MPB's Q3 earnings are a clear buy signal, fueled by smart acquisitions and strong core banking growth, despite rising expenses.**

AI Summary

MID PENN BANCORP INC (MPB) reported a significant increase in net income for the three months ended September 30, 2025, reaching $18.297 million, up 48.7% from $12.301 million in the same period of 2024. This growth was primarily driven by a substantial 33.5% increase in Net Interest Income, which rose to $53.629 million from $40.169 million year-over-year. Total assets expanded considerably to $6.267 billion as of September 30, 2025, from $5.471 billion at December 31, 2024, largely due to the William Penn acquisition on April 30, 2025, which contributed $687.522 million in acquired assets. Loans, net of unearned income, increased to $4.821 billion from $4.443 billion, while total deposits grew to $5.343 billion from $4.690 billion. Noninterest income also saw a robust increase of 58.0%, reaching $8.183 million, primarily from 'Other' noninterest income and earnings from cash surrender value of life insurance. However, noninterest expense surged by 26.8% to $37.982 million, with merger and acquisition expenses jumping to $11.558 million for the nine months ended September 30, 2025, compared to $109,000 in the prior year. Basic Earnings Per Common Share for the quarter increased to $0.80 from $0.74, despite a significant increase in weighted-average basic shares outstanding to 23,005,504 from 16,612,657.

Why It Matters

This strong performance, particularly the significant increase in net interest income and net income, signals robust operational health for Mid Penn Bancorp, Inc. (MPB), which is crucial for investor confidence. The substantial growth in assets and deposits, largely driven by the William Penn acquisition, indicates successful expansion and market penetration, potentially increasing MPB's competitive standing against regional banks. For employees, this growth could mean increased job security and opportunities, while customers may benefit from an expanded service network and product offerings. The acquisition strategy, while incurring high merger expenses, positions MPB for future market share gains and could influence other regional banks to pursue similar consolidation strategies.

Risk Assessment

Risk Level: medium — The risk level is medium due to the significant increase in noninterest expense, particularly merger and acquisition costs, which jumped to $11.558 million for the nine months ended September 30, 2025, from $109,000 in the prior year. Additionally, foreclosed assets held for sale increased dramatically to $9.346 million from $44,000, indicating potential asset quality concerns or integration challenges from recent acquisitions.

Analyst Insight

Investors should closely monitor MPB's integration of the William Penn acquisition and its impact on future profitability and asset quality. While the net interest income growth is positive, the surge in merger-related expenses and foreclosed assets warrants caution. Consider holding MPB shares, but be prepared to re-evaluate if asset quality deteriorates or if acquisition synergies fail to materialize as expected.

Financial Highlights

debt To Equity

0.06

revenue

$61.812M

operating Margin

N/A

total Assets

$6.267B

total Debt

$60.407M

net Income

$18.297M

eps

$0.80

gross Margin

N/A

cash Position

$257.169M

revenue Growth

+34.1%

Revenue Breakdown

Key Numbers

• $18.297M — Net Income (Increased 48.7% for Q3 2025 compared to Q3 2024)
• $53.629M — Net Interest Income (Increased 33.5% for Q3 2025 compared to Q3 2024)
• $6.267B — Total Assets (Increased from $5.471B at Dec 31, 2024, driven by acquisitions)
• $4.821B — Loans, net of unearned income (Increased from $4.443B at Dec 31, 2024)
• $5.343B — Total Deposits (Increased from $4.690B at Dec 31, 2024)
• $11.558M — Merger and acquisition expense (Significant increase for nine months ended Sep 30, 2025, from $109K in prior year)
• $0.80 — Basic Earnings Per Common Share (Increased from $0.74 for Q3 2025 despite higher share count)
• $9.346M — Foreclosed assets held for sale (Increased dramatically from $44K at Dec 31, 2024)
• 23,005,504 — Weighted-average basic shares outstanding (Increased from 16,612,657 for Q3 2024)
• $687.522M — Fair value of assets acquired (From business combinations, excluding cash)

Key Players & Entities

• MID PENN BANCORP INC (company) — Registrant
• William Penn (company) — Acquired company
• Charis Insurance Group (company) — Acquired company
• $18.297 million (dollar_amount) — Net income for Q3 2025
• $12.301 million (dollar_amount) — Net income for Q3 2024
• $53.629 million (dollar_amount) — Net Interest Income for Q3 2025
• $40.169 million (dollar_amount) — Net Interest Income for Q3 2024
• $6.267 billion (dollar_amount) — Total Assets as of September 30, 2025
• $5.471 billion (dollar_amount) — Total Assets as of December 31, 2024
• $11.558 million (dollar_amount) — Merger and acquisition expense for nine months ended September 30, 2025

FAQ

Risk Factors

• Integration of Acquired Businesses [medium — operational]: The acquisition of William Penn on April 30, 2025, contributed $687.522 million in assets. Successful integration is crucial for realizing the expected benefits and managing potential operational disruptions. Failure to integrate effectively could impact financial performance and operational efficiency.
• Interest Rate Sensitivity [medium — financial]: Net interest income increased by 33.5% to $53.629 million for Q3 2025. Changes in interest rates can significantly impact the bank's net interest margin and overall profitability, especially with a growing loan and deposit base.
• Credit Risk and Loan Portfolio Quality [medium — financial]: Loans, net of unearned income, increased to $4.821 billion. The Allowance for Credit Losses (ACL) was $37.337 million as of September 30, 2025. Deterioration in loan quality or an increase in non-performing loans could lead to higher provisions for credit losses.
• Increased Noninterest Expense [medium — operational]: Noninterest expense surged by 26.8% to $37.982 million for Q3 2025. A significant portion of this increase is attributed to merger and acquisition expenses, which jumped to $11.558 million for the nine months ended September 30, 2025. Managing these costs is essential for profitability.
• Liquidity Management [low — financial]: Total deposits grew to $5.343 billion. Maintaining adequate liquidity to meet deposit withdrawals and fund loan growth is critical. Changes in deposit composition and customer behavior can affect liquidity.
• Foreclosed Assets [medium — financial]: Foreclosed assets held for sale increased dramatically from $44,000 to $9.346 million. A significant increase in foreclosed assets can indicate underlying credit issues in the loan portfolio and may lead to valuation losses.
• Economic Conditions [medium — market]: The bank operates in Pennsylvania and New Jersey. Adverse economic conditions in these regions could negatively impact loan demand, credit quality, and overall financial performance.
• Regulatory Compliance [medium — regulatory]: As a financial institution, Mid Penn Bancorp is subject to extensive regulation. Changes in banking laws and regulations, or failure to comply, could result in fines, penalties, and reputational damage.

Industry Context

Mid Penn Bancorp operates within the highly competitive regional banking sector, focusing on commercial banking and trust services in Pennsylvania and New Jersey. The industry is characterized by ongoing consolidation, technological advancements, and evolving regulatory landscapes. Banks are increasingly focused on digital transformation, expanding fee-based income streams, and managing interest rate risk.

Regulatory Implications

As a federally insured financial institution, Mid Penn Bancorp is subject to stringent oversight from regulatory bodies like the Federal Reserve and the FDIC. Compliance with capital requirements, lending standards, and consumer protection laws is paramount. Any changes in regulatory policy, such as interest on reserve balances or capital adequacy rules, could impact profitability and operational strategies.

What Investors Should Do

1. Monitor integration progress of William Penn acquisition.
2. Analyze trends in net interest margin and loan/deposit growth.
3. Assess the increase in noninterest expenses, particularly M&A costs.
4. Evaluate the increase in foreclosed assets.
5. Review the impact of increased share count on EPS.

Key Dates

• 2025-04-30: William Penn Acquisition Completed — Significantly increased total assets by $687.522 million and contributed to revenue growth.
• 2025-09-30: Quarter End and 10-Q Filing Period — Reported net income of $18.297 million, a 48.7% increase year-over-year, driven by strong net interest income.
• 2025-09-30: Consolidated Balance Sheet Date — Total assets reached $6.267 billion, up from $5.471 billion at year-end 2024.
• 2025-09-30: Consolidated Statement of Income Period End — Net interest income grew 33.5% to $53.629 million for the three months ended September 30, 2025.
• 2025-09-30: Nine Months Ended — Merger and acquisition expenses were $11.558 million, a substantial increase from $109,000 in the prior year.

Glossary

Net Interest Income

The difference between the interest income generated by a bank and the interest paid out to its depositors and lenders. (A primary driver of profitability for banks, showing strong growth of 33.5% for MPB in Q3 2025.)

Allowance for Credit Losses (ACL)

An estimate of the amount of uncollectible loans in a bank's portfolio. (Indicates the bank's provision for potential loan defaults, which was $37.337 million as of September 30, 2025.)

HTM Securities

Held-to-Maturity securities are debt investments that a company has the intent and ability to hold until they mature. (MPB held $354.094 million in HTM securities at amortized cost as of September 30, 2025.)

AFS Securities

Available-for-Sale securities are debt investments that are not classified as held-to-maturity or trading securities. (MPB held $427.352 million in AFS securities at fair value as of September 30, 2025.)

Goodwill

An intangible asset that arises when one company acquires another company for a price greater than the fair market value of its net assets. (MPB's goodwill increased to $136.620 million, largely due to acquisitions like William Penn.)

Core deposit and other intangibles, net

Intangible assets representing the value of core customer relationships and other acquired intangible assets, net of amortization. (Increased to $15.586 million, reflecting the impact of acquisitions.)

Foreclosed assets held for sale

Real estate or other property that a bank has taken possession of due to foreclosure on a loan, which is intended to be sold. (A significant increase to $9.346 million indicates potential credit issues and future disposition challenges.)

Weighted-average basic shares outstanding

The average number of common shares outstanding during a period, used for calculating basic earnings per share. (Increased significantly to 23,005,504 for Q3 2025, impacting EPS despite higher net income.)

Year-Over-Year Comparison

Compared to the prior year, Mid Penn Bancorp has demonstrated robust growth in net income (48.7%) and net interest income (33.5%), largely fueled by the strategic acquisition of William Penn. Total assets have expanded significantly, and loan and deposit bases have grown. However, this growth has come with a substantial increase in noninterest expenses, particularly merger and acquisition costs, which surged from $109,000 to $11.558 million for the nine-month period. While basic EPS saw an increase, it was tempered by a significant rise in weighted-average shares outstanding. New risks related to the integration of acquired businesses and a notable increase in foreclosed assets are also apparent.

Key Financial Figures

• $1.00 — ange on which registered Common Stock, $1.00 par value per share MPB The NASDAQ Stoc

Filing Documents

• mpb-20250930.htm (10-Q) — 4643KB
• mpb-20250930xexx311xq.htm (EX-31.1) — 11KB
• mpb-20250930xexx312xq.htm (EX-31.2) — 11KB
• mpb-20250930xexx32xq.htm (EX-32) — 8KB
• 0000879635-25-000177.txt ( ) — 21409KB
• mpb-20250930.xsd (EX-101.SCH) — 74KB
• mpb-20250930_cal.xml (EX-101.CAL) — 203KB
• mpb-20250930_def.xml (EX-101.DEF) — 467KB
• mpb-20250930_lab.xml (EX-101.LAB) — 1009KB
• mpb-20250930_pre.xml (EX-101.PRE) — 718KB
• mpb-20250930_htm.xml (XML) — 5540KB

– Financial Statements

Item 1 – Financial Statements 4 Consolidated Balance Sheets as of September 30, 2025 and December 31, 2024 (Unaudited) 4 Consolidated Statements of Income for the Three and Nine Months Ended September 30, 2025 and 2024 (Unaudited) 5 Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30, 2025 and 2024 (Unaudited) 6 Consolidated Statements of Changes in Shareholders' Equity for the Three and Nine Months Ended September 30, 2025 and 2024 (Unaudited) 7 Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2025 and 2024 (Unaudited) 9

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) 11

– Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2 – Management's Discussion and Analysis of Financial Condition and Results of Operations 51

– Quantitative and Qualitative Disclosures about Market Risk

Item 3 – Quantitative and Qualitative Disclosures about Market Risk 74

– Controls and Procedures

Item 4 – Controls and Procedures 75

– OTHER INFORMATION

PART II – OTHER INFORMATION 76

– Legal Proceedings

Item 1 – Legal Proceedings 76

– Risk Factors

Item 1A – Risk Factors 76

– Unregistered Sales of Equity Securities and Use of Proceeds

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds 79

– Defaults upon Senior Securities

Item 3 – Defaults upon Senior Securities 80

– Mine Safety Disclosures

Item 4 – Mine Safety Disclosures 80

– Other Information

Item 5 – Other Information 80

– Exhibits

Item 6 – Exhibits 81

Signatures

Signatures 82 Unless the context otherwise requires, the terms "Mid Penn", "Corporation" "we", "us", and "our" refer to Mid Penn Bancorp, Inc. and its consolidated wholly-owned banking subsidiary and nonbank subsidiaries. 2 Table of Contents GLOSSARY OF DEFINED ACRONYMS AND TERMS 1st Colonial 1st Colonial Bancorp, Inc., a Pennsylvania Corporation 2023 Plan 2023 Stock Incentive Plan ACL Allowance for Credit Losses AFS Available for Sale AOCI Accumulated Other Comprehensive Income/(Loss) ASC Accounting Standards Codification ASU Accounting Standards Update the Bank Mid Penn Bank BOLI Bank Owned Life Insurance bp or bps basis point(s) CCL Provision for Credit Losses - Credit Commitments CD Certificate of Deposit CECL Current Expected Credit Losses as defined by FASB ASC Topic 326 CRE Commercial Real Estate DCF Discounted Cash Flow DIF FDIC's Deposit Insurance Fund DRIP Dividend Reinvestment Plan EPS Earnings per share FASB Financial Accounting Standards Board FDIC Federal Deposit Insurance Corporation FHLB Federal Home Loan Bank of Pittsburgh FICO Fair Isaac Corporation credit scoring model FOMC Federal Open Market Committee FTE Fully taxable-equivalent HELOC Home Equity Line of Credit HFS Held for Sale HTM Held to Maturity GAAP Accounting principles generally accepted in the United States of America GDP Gross domestic product LGD Loss Given Default LHFI Loans held for investment Loans Loans, net of unearned income Management Discussion Management's Discussion and Analysis of Financial Condition and Results of Operations Merger 1st Colonial Community Bank, a New Jersey-chartered bank and wholly owned subsidiary of 1st Colonial, will merge with and into the Bank, with the Bank continuing as the surviving bank Merger Agreement Agreement and Plan of Merger between Mid Penn and 1st Colonial dated September 24, 2025 Mid Penn or the Corporation Mid Penn Bancorp, Inc. NASDAQ Major stock exchange where the Corporation's shares ar

– FINANCIAL STATEMENTS

ITEM 1 – FINANCIAL STATEMENTS CONSOLIDATED BALANCE SHEETS (UNAUDITED) (In thousands, except per share data) September 30, 2025 December 31, 2024 ASSETS Cash and due from banks $ 18,013 $ 37,002 Interest-bearing balances with other financial institutions 24,736 14,490 Federal funds sold 214,420 19,072 Total Cash and cash equivalents 257,169 70,564 Investment securities: HTM, at amortized cost (fair value $ 325,606 and $ 340,648 , respectively) 354,094 382,447 AFS, at fair value (amortized cost $ 439,853 and $ 284,770 , respectively) 427,352 260,477 Equity securities, at fair value 442 428 Loans held for sale, at fair value 6,085 7,064 Loans, net of unearned income 4,821,134 4,443,070 Less: ACL - Loans ( 37,337 ) ( 35,514 ) Net loans 4,783,797 4,407,556 Premises and equipment, net 48,491 38,806 Operating lease right of use asset 15,700 7,699 Finance lease right of use asset 2,413 2,548 Cash surrender value of life insurance 95,015 51,521 Restricted investment in bank stocks 6,737 7,461 Accrued interest receivable 29,705 26,846 Deferred income taxes 27,475 22,747 Goodwill 136,620 128,160 Core deposit and other intangibles, net 15,586 6,242 Foreclosed assets held for sale 9,346 44 Other assets 51,322 50,326 Total Assets $ 6,267,349 $ 5,470,936 LIABILITIES & SHAREHOLDERS' EQUITY Deposits: Noninterest-bearing demand $ 836,374 $ 759,169 Interest-bearing transaction accounts 2,858,082 2,319,753 Time 1,648,264 1,611,005 Total Deposits 5,342,720 4,689,927 Short-term borrowings — 2,000 Long-term debt 23,258 23,603 Subordinated debt 37,149 45,741 Operating lease liability 15,973 8,092 Accrued interest payable 16,460 13,484 Other liabilities 35,466 33,071 Total Liabilities 5,471,026 4,815,918 Shareholders' Equity: Common stock, par value $ 1.00 per share; 40,000,000 shares authorized at September 30, 2025 and December 31, 2024; 23,550,614 issued at September 30, 2025 and 19,796,519 at December 31, 2024; 23,039,223 outstanding at

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Note 1 - Summary of Significant Accounting Policies Nature of Operations Mid Penn Bancorp, Inc. ("Mid Penn" or the "Corporation"), through operations conducted by Mid Penn Bank (the "Bank") and its nonbank subsidiaries, engages in a full-service commercial banking and trust business, making available to the community a wide range of financial services, including, but not limited to, mortgage and home equity loans, secured and unsecured commercial and consumer loans, lines of credit, construction financing, farm loans, community development loans, loans to non-profit entities and local government loans, and various types of time and demand deposits including but not limited to, checking accounts, savings accounts, clubs, money market deposit accounts, certificates of deposit, and Individual Retirement Accounts. In addition, the Bank provides a full range of trust and wealth management services through its Trust Department. Deposits are insured by the Federal Deposit Insurance Corporation ("FDIC") to the extent provided by law. Mid Penn also fulfills the insurance needs of both existing and potential customers through MPB Risk Services, LLC, doing business as MPB Insurance and Risk Management. The financial services are provided to individuals, partnerships, non-profit organizations, and corporations through its retail banking offices located throughout Pennsylvania and five counties in New Jersey. Basis of Presentation For all periods presented, the accompanying consolidated financial statements include the accounts of Mid Penn Bancorp, Inc., its wholly-owned subsidiary, Mid Penn Bank, and five wholly-owned nonbank subsidiaries, MPB Realty Holding, LLC, MPB Financial Services, LLC, MPB Wealth Management, LLC (which ceased operating during the first quarter of 2024), MPB Risk Services, LLC, and MPB Launchpad Fund I, LLC. As of September 30, 2025, the accounts and activities of these nonbank subsidiaries w

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