Southern Michigan Bancorp, Inc. Announces Third Quarter 2025 Earnings

COLDWATER, Mich., Oct. 29, 2025 (GLOBE NEWSWIRE) -- Southern Michigan Bancorp, Inc. (OTC Pink: SOMC) announced third quarter 2025 net income of $3,019,000, or $0.65 per share, an increase of $433,000, or 16.70%, compared to net income of $2,586,000, or $0.57 per share, for the third quarter of 2024. For the first nine months of 2025, Southern earned $9,303,000, or $2.01 per share, an increase of $1,552,000, or 20.0%, compared to net income of $7,751,000, or $1.70 per share, for the same nine-month period one year ago.

The annualized return on average assets for the nine-month periods ended September 30, 2025, and September 30, 2024, was 0.79% and 0.70%, respectively. The annualized return on average equity was 11.00% for the first nine months of 2025 compared to 10.18% for the first nine months of 2024. The tax equivalent net interest margin for the nine-month period ending September 30, 2025 was 3.21% 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 announce another solid quarter of earnings and growth. Our ongoing commitment to expanding our markets and investing in our team led to record levels in loans, deposits, and total assets at quarter end.”

The allowance for credit losses totaled $14,410,000, or 1.17% of loans on September 30, 2025. Net loan charge-offs totaled $29,000 for the first nine months of 2025, compared to $20,000 for the first nine months of 2024. Non-performing loans as a percentage of total loans were 1.03% as of September 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)

	September 30, 2025			December 31, 2024
ASSETS
Cash and cash equivalents	$	127,565		$	73,737
Federal funds sold		250			259
Securities available for sale, at fair value		156,020			159,320
Securities held-to-maturity, at amortized cost		63,702			60,454
Loans held-for-sale		559			995
Loans, net of allowance for credit losses of $14,410 – 2025, $12,782 - 2024		1,214,376			1,103,652
Premises and equipment, net		25,039			25,600
Net cash surrender value of life insurance		28,277			23,139
Goodwill		13,422			13,422
Other intangible assets, net		84			111
Other assets		35,803			35,866
TOTAL ASSETS	$	1,665,097		$	1,496,555

LIABILITIES
Deposits:
Non-interest bearing	$	225,670		$	223,583
Interest bearing		1,169,262			1,028,212
Total deposits		1,394,932			1,251,795

Securities sold under agreements to repurchase and overnight borrowings		1,109			1,560
Accrued expenses and other liabilities		18,604			18,355
Other borrowings		97,900			82,900
Subordinated debentures		34,774			34,722
Total liabilities		1,547,319			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 – 4,625,601 shares in 2025, 4,577,107 shares in 2024		11,560			11,438
Additional paid-in capital		13,503			13,438
Retained earnings		104,543			97,462
Accumulated other comprehensive loss		(11,828	)		(15,115	)
Total shareholders’ equity		117,778			107,223
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,665,097		$	1,496,555

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

(In thousands, except per share data)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Interest income:
Loans, including fees	$	18,681	$	16,444	$	53,724	$	47,748
Federal funds sold and balances with banks		726		1,313		2,492		3,630
Securities:
Taxable		1,468		1,465		4,405		4,512
Tax-exempt		394		309		1,089		904
Total interest income		21,269		19,531		61,710		56,794

Interest expense:
Deposits		7,731		7,567		22,587		21,655
Other		1,452		1,571		4,037		4,701
Total interest expense		9,183		9,138		26,624		26,356
Net interest income		12,086		10,393		35,086		30,438
Provision for credit losses		1,200		425		1,864		661
Net interest income after provision for credit losses		10,886		9,968		33,222		29,777

Non-interest income:
Service charges on deposit accounts		423		439		1,226		1,270
Trust fees		820		741		2,345		2,041
Net gains on loan sales		250		181		744		419
Earnings on life insurance assets		227		169		805		498
ATM and debit card fee income		478		465		1,406		1,356
Gain on sale of fixed assets		220		-		220		-
Other		200		177		602		608
Total non-interest income		2,618		2,172		7,348		6,192

Non-interest expense:
Salaries and employee benefits		5,992		5,528		17,985		16,154
Occupancy, net		651		519		1,837		1,515
Equipment		474		400		1,462		1,233
Professional and outside services		507		530		1,555		1,575
Software maintenance		718		626		2,067		1,817
ATM expenses		270		229		742		629
Printing, postage, and supplies		112		124		345		413
Telecommunication expenses		75		75		223		240
Other		1,180		972		3,311		2,958
Total non-interest expense		9,979		9,003		29,527		26,534
INCOME BEFORE INCOME TAXES		3,525		3,137		11,043		9,435
Federal income tax provision		506		551		1,740		1,684
NET INCOME	$	3,019	$	2,586	$	9,303	$	7,751

Basic Earnings Per Common Share	$	0.65	$	0.57	$	2.02	$	1.70
Diluted Earnings Per Common Share		0.65		0.57		2.01		1.70
Dividends Declared Per Common Share		0.16		0.15		0.48		0.45

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

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