Southern Michigan Bancorp, Inc. Announces Second Quarter 2025 Earnings

COLDWATER, Mich., July 23, 2025 (GLOBE NEWSWIRE) -- Southern Michigan Bancorp, Inc. (OTC Pink: SOMC) announced second quarter 2025 net income of $3,238,000, or $0.70 per share, an increase of $750,000, or 30.14%, compared to net income of $2,488,000, or $0.55 per share, for the second quarter of 2024. For the first six months of 2025, Southern earned $6,284,000, or $1.36 per share, an increase of $1,118,000, or 21.64%, compared to net income of $5,166,000, or $1.14 per share, for the same six-month period one year ago.

The annualized return on average assets for the six-month periods ended June 30, 2025, and June 30, 2024, was 0.81% and 0.71%, respectively. The annualized return on average equity was 11.31% for the first six months of 2025 compared to 10.34% for the first six months of 2024. The tax equivalent net interest margin for the six-month period ending June 30, 2025 was 3.20% compared to 2.94% for the same period of 2024.

John R. Waldron, President and Chief Executive Officer of Southern Michigan Bancorp, Inc., stated, “We are pleased to report another solid quarter. Our earnings trend remained positive, and credit quality remained strong. Our continued investment in market expansion and staff translated into record loans and total assets at quarter end.”

The allowance for credit losses totaled $13,224,000, or 1.11% of loans on June 30, 2025. Net loan charge-offs totaled $15,000 for the first six months of 2025, compared to $11,000 for the first six months of 2024. Non-performing loans as a percentage of total loans were 0.01% as of June 30, 2025, and 0.08% as of December 31, 2024.

Southern Michigan Bancorp, Inc. is a bank holding company and the parent company of Southern Michigan Bank & Trust. It operates 18 offices within Branch, Calhoun, Hillsdale, Jackson, Kalamazoo and St. Joseph Counties providing a broad range of consumer, business and wealth management services throughout the region.

This press release contains forward-looking statements that are based on management’s beliefs, assumptions, current expectations, estimates and projections about the financial services industry, the economy, and Southern Michigan Bancorp, Inc. Forward-looking statements are identifiable by words or phrases such as “expected,” “begin,” and other similar words or expressions. All statements with reference to a future time period are forward-looking. Management’s determination of the provision and allowance for credit losses and other accounting estimates, such as the carrying value of goodwill, other real estate owned, mortgage servicing rights and the fair value of investment securities, involves judgments that are inherently forward-looking. The future effect of changes in the financial and credit markets and the national and regional economy on the banking industry, generally, and Southern Michigan Bancorp, Inc., specifically, are also inherently uncertain. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions ("risk factors") that are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. Therefore, actual results and outcomes may materially differ from what may be expressed in or implied by such forward-looking statements. Southern Michigan Bancorp, Inc., does not update forward-looking statements to reflect the impact of circumstances or events that may arise after the date of the forward-looking statements.

SOUTHERN MICHIGAN BANCORP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(In thousands, except share data)
	June 30, 2025			December 31, 2024
ASSETS
Cash and cash equivalents	$	59,176		$	73,737
Federal funds sold		257			259
Securities available for sale, at fair value		160,961			159,320
Securities held-to-maturity, at amortized cost		68,398			60,454
Loans held-for-sale		180			995
Loans, net of allowance for credit losses of $13,224 – 2025, $12,782 - 2024		1,180,162			1,103,652
Premises and equipment, net		25,502			25,600
Net cash surrender value of life insurance		28,050			23,139
Goodwill		13,422			13,422
Other intangible assets, net		93			111
Other assets		35,062			35,866
TOTAL ASSETS	$	1,571,263		$	1,496,555

LIABILITIES
Deposits:
Non-interest bearing	$	233,369		$	223,583
Interest bearing		1,070,746			1,028,212
Total deposits		1,304,115			1,251,795

Securities sold under agreements to repurchase and overnight borrowings		818			1,560
Accrued expenses and other liabilities		19,962			18,355
Other borrowings		97,900			82,900
Subordinated debentures		34,756			34,722
Total liabilities		1,457,551			1,389,332

SHAREHOLDERS’ EQUITY
Preferred stock, 100,000 shares authorized; none issued or outstanding		-			-
Common stock, $2.50 par value:
Authorized - 10,000,000 shares
Issued and outstanding – 4,627,809 shares in 2025, 4,577,107 shares in 2024		11,565			11,438
Additional paid-in capital		13,769			13,438
Retained earnings		102,264			97,462
Accumulated other comprehensive loss		(13,886	)		(15,115	)
Total shareholders’ equity		113,712			107,223
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,571,263		$	1,496,555

Southern Michigan Bancorp, Inc.
condensed consolidated statements of income (unaudited)

(In thousands, except per share data)

	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Interest income:
Loans, including fees	$	18,268	$	15,838	$	35,043	$	31,304
Federal funds sold and balances with banks		766		1,058		1,766		2,317
Securities:
Taxable		1,530		1,565		2,937		3,048
Tax-exempt		377		296		695		595
Total interest income		20,941		18,757		40,441		37,264

Interest expense:
Deposits		7,553		7,269		14,856		14,088
Other		1,301		1,503		2,585		3,130
Total interest expense		8,854		8,772		17,441		17,218
Net interest income		12,087		9,985		23,000		20,046
Provision for credit losses		500		236		664		236
Net interest income after provision for credit losses		11,587		9,749		22,336		19,810

Non-interest income:
Service charges on deposit accounts		397		407		803		831
Trust fees		786		659		1,525		1,300
Net gains on loan sales		274		141		494		237
Earnings on life insurance assets		207		165		578		329
ATM and debit card fee income		484		467		928		891
Other		213		200		402		432
Total non-interest income		2,361		2,039		4,730		4,020

Non-interest expense:
Salaries and employee benefits		6,220		5,330		11,993		10,626
Occupancy, net		571		497		1,186		996
Equipment		501		409		988		833
Professional and outside services		596		459		1,048		1,045
Software maintenance		691		598		1,349		1,190
ATM expenses		236		210		472		399
Printing, postage, and supplies		104		128		232		289
Telecommunication expenses		76		78		148		165
Other		1,101		1,036		2,131		1,988
Total non-interest expense		10,096		8,745		19,547		17,531
INCOME BEFORE INCOME TAXES		3,852		3,043		7,519		6,299
Federal income tax provision		614		555		1,235		1,133
NET INCOME	$	3,238	$	2,488	$	6,284	$	5,166

Basic Earnings Per Common Share	$	0.70	$	0.55	$	1.36	$	1.14
Diluted Earnings Per Common Share		0.70		0.55		1.36		1.14
Dividends Declared Per Common Share		0.16		0.15		0.32		0.30

CONTACT: John R. Waldron, President and CEO
(517) 279-5500

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