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MBT Financial Corp. Announces Second Quarter 2018 Preliminary Earnings and Dividend Increase

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MONROE, Mich., July 26, 2018 (GLOBE NEWSWIRE) -- MBT Financial Corp. (NASDAQ:MBTF), the parent company of Monroe Bank & Trust, reported a preliminary net profit of $4,945,000 ($0.22 per basic share and $0.21 per diluted share), in the second quarter of 2018, compared to a profit of $3,640,000 ($0.16 per share, basic and diluted), in the second quarter of 2017. The profit for the first six months of 2018 was $8,847,000 ($0.39 per basic share and $0.38 per diluted share), compared to $6,820,000 ($0.30 per share, basic and diluted) for the first six months of 2017. The company also announced that it will pay a quarterly dividend of $0.10 per common share on August 16, 2018 to shareholders of record as of August 9, 2018. This is an increase of $0.03 per share compared to the dividend paid last quarter and an increase of $0.04 compared to the dividend paid in the same quarter last year.

The Net Interest Income for the second quarter of 2018 increased $969,000, or 9.8% as the net interest margin improved from 3.31% in the second quarter of 2017 to 3.64% in the second quarter of 2018 as higher interest rates and shifting assets from investment securities to loans improved the yield on earning assets while the cost of interest bearing liabilities remained low.

The Company did not record a provision for loan losses this quarter or in the second quarter of 2017. Asset quality continues to be strong, and recoveries of previously charged off loans exceeded charge offs during the second quarter of 2018. This provided sufficient growth in the Allowance for Loan Losses to maintain its adequacy even though the amount of loans increased. Total Loans increased $18.5 million, or 2.6% during the second quarter quarter of 2018, and $45.8 million, or 6.6% so far this year. The Allowance for Loan and Lease Losses increased from $7.7 million at the end of 2017 to $8.0 million at the end of the second quarter of 2018. Due to the loan growth, the Allowance as a percent of loans decreased since the beginning of the year from 1.10% to 1.07%.

Non-interest income for the second quarter of 2018 increased $33,000, or 0.8% compared to the second quarter of 2017. Excluding gains and losses on securities and other real estate transactions in both periods and an adjustment to recognize wealth management income on an accrual basis in 2017, the non-interest income decreased $89,000, or 2.2%. Non-interest income in the second quarter of 2018 included $517,000 of gains on the sales of Other Real Estate. Non-interest expense increased $178,000, or 2.0%, mainly due to increases in salaries and benefits, equipment, and marketing expenses.

Total assets of the company decreased $25.5 million, or 1.9%, compared to December 31, 2017, to $1.32 billion. Capital decreased $12.3 million during the first six months of 2018 primarily because the payment of the special and regular dividends exceeded the net income. The ratio of equity to assets decreased from 9.85% at the end of 2017 to 9.10% at the end of the second quarter of 2018. The Bank's Tier 1 Leverage ratio decreased from 10.33% as of December 31, 2017 to 9.89% as of June 30, 2018.

H. Douglas Chaffin, President and CEO, commented, "We continue to see solid loan growth, and the improvement in net interest margin combined with the effects of the Tax Cuts and Jobs Act contributed to the substantial improvement in earnings this quarter. Our new business pipeline remains strong and we expect loan growth to continue the rest of this year, which should lead to further margin improvement.  Notably, we also expect credit quality to remain strong, as we see nothing that might inhibit our strong quality metrics in the near term. Our focus on managing our capital has also allowed us to bring more value to our shareholders, and the increase in the quarterly dividend we announced today reflects a higher payout ratio. Our earnings growth trend has been strong, and a consistent increase in the dividend will decrease the need for the special dividends we used in the past three years. We will continue to keep our eyes open for the right opportunities to grow through strategic acquisitions, while remaining disciplined in that regard. We remain confident in our ability to maintain our position as the premier independent provider of financial services in the communities we serve."

Conference Call
MBT Financial Corp. will hold a conference call to discuss the Second Quarter 2018 results on Friday, July 27, 2018, at 10:00 a.m. Eastern Time. The call will be webcast and can be accessed at the Investor Relations/Corporate Profile page of MBT Financial Corp.'s web site www.monroe.bank. The call can also be accessed in the United States by calling toll free (877) 510-3783. The toll free number for callers in Canada is (855) 669-9657 and international callers can access the call at (412) 902-4136. A replay will be available one hour after the conclusion of the call at (877) 344-7529, Conference #10121798. The replay is available to callers from Canada at (855) 669-9658 and international callers at (412) 317-0088. The replay will be available until August 27, 2018 at 9:00 a.m. Eastern. The webcast will be archived on the Company's web site and available for twelve months following the call.

About the Company:
MBT Financial Corp. (NASDAQ:MBTF), a bank holding company headquartered in Monroe, Michigan, is the parent company of Monroe Bank & Trust. Founded in 1858, Monroe Bank & Trust helps customers' remarkable stories unfold through an uncommon, optimistic culture. As one of the largest independently owned community banks in Southeast Michigan, with over $1.3 billion in assets, this full-service bank offers a complete range of business and personal accounts, mobile and online banking, offices and ATMs across Monroe and Wayne Counties, credit and mortgage options, investment and retirement services and award-winning community outreach. The bank believes in its customers, helping them with everything from day-to-day needs to long-term goals, and is ranked fourth among all Michigan banks for total trust assets.  The bank believes in its communities, supporting over 300 organizations with sponsorships and also more than 8,000 employee volunteer hours through the Monroe Bank & Trust ENLIST Volunteerism program. The bank believes in the power of knowledge, helping thousands of students and adults thrive through the Monroe Bank & Trust Financial Education program.  Monroe Bank & Trust is proud to be a trusted partner to communities and clients, and an employer of choice.  We are Monroe Bank & Trust, and we believe in the story of you.

For more information about Monroe Bank & Trust, visit www.monroe.bank.
Or, contact:
Julian Broggio
SVP, Director of Marketing
(734) 240-2341
julian.broggio@monroe.bank

MBT FINANCIAL CORP.  
CONSOLIDATED FINANCIAL HIGHLIGHTS - UNAUDITED  
                                   
        Quarterly   Year to Date  
          2018       2018       2017       2017       2017            
(dollars in thousands except per share data)   2nd Qtr   1st Qtr   4th Qtr   3rd Qtr   2nd Qtr     2018       2017    
                                   
EARNINGS                              
  Net interest income   $   10,833     $   10,536     $   10,373     $   10,231     $   9,864     $   21,369     $   19,459    
  FTE Net interest income   $   10,945     $   10,638     $   10,552     $   10,394     $   10,017     $   21,583     $   19,766    
  Provision for loan and lease losses   $   -      $   (100 )   $   (500 )   $   -      $   -      $   (100 )   $   (200 )  
  Non interest income   $   4,403     $   3,784     $   3,657     $   4,035     $   4,370     $   8,187     $   8,190    
  Non interest expense   $   9,186     $   9,792     $   9,115     $   8,950     $   9,008     $   18,978     $   18,070    
  Net income   $   4,945     $   3,902     $   (144 )   $   3,933     $   3,640     $   8,847     $   6,820    
  Basic earnings per share   $   0.22    
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