Mid Penn Bancorp Case Solution

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The most significant differences in liability composition for 2014 for Mid Penn Bancorp, Inc. versus its peer group of banks with between $500 million to $1 billion in assets:
Mid Penn Bancorp, Inc. has a higher proportion of interest-bearing deposits - 76.40 percent of total liabilities and capital versus 66.13 percent for the peer group.
Mid Penn Bancorp, Inc. has a higher proportion of other borrowed funds - 7.01 percent of total liabilities and capital versus 3.60 percent for the peer group.

The most significant differences in components of the Report of Income for 2014 for Mid Penn Bancorp, Inc. versus its peer group of banks with between $500 million to $1 billion in assets:
Mid Penn Bancorp, Inc. has a lower proportion of total noninterest
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Mid Penn’s ROE increased from 9.58% in 2013 to 10.7% in 2014. Mid Penn’s ROE increased because net interest income increased by $2.7 million, which is the most significant dollar change in the Report of Income. In addition, total equity capital increased substantially by $6.4 million. The increase in both numbers made the ROE ratio higher. Their peer group’s ROE is 9.58% for 2013. ROA is defined as net income divided by total assets. Mid Penn’s ROA increased from 0.71% in 2013 to 0.84% in 2014. Mid Penn’s ROA increased slightly because net interest income increased by $2.7 million, which is the most significant dollar change in the Report of Income. Also, total assets increased by $42.5 million, thanks to total securities and and net loans and leases increasing. These increases were from Mid Penn making more loans and purchasing more securities. Their peer group’s ROA is 1.07% for …show more content…
Mid Penn’s NIM increased slightly from 3.35% to 3.78%. Total interest income increased by $1.6 million while total interest expense decreased by $629 million. This change caused net interest income to increase by $2.3 million. Total assets increased as explained above. These combined changes are why NIM margin increased. Their peer group’s NIM is 3.81%. NNIM is defined as net noninterest income divided by earning assets. Mid Penn’s NNIM decreased from -2.40% in 2013 to -2.36% in 2014. Total noninterest income decreased by $532 million while total noninterest expense increased by $201 million. Total earning assets increased by $41.5 million. The smaller numerator and larger denominator caused NNIM to be smaller in 2014. Their peer group’s NNIM is -2.02% for 2014.. NOM is defined as pre-tax net operating income divided by total assets. Mid Penn’s NOM increased from 0.86% in 2013 to 1.02% in 2014. . Pre-tax net operating income increased by $1.6 million. Looking at the report of income, total income is higher than total expenses overall, which would cause the pre-tax operating income increase. The increase in total assets was explained above. These overall changes caused the NOM to increase. Overall, Mid Penn has increased its profitability from 2013 to 2014. Their peer group’s NOM is 1.29% for

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