Midland States slides after bad loan provisions drive Q3 miss

Community lender Midland States Bancorp's MSBI.O shares slide 9.1% to $14.57

Late Thursday, MSBI reported quarterly profit below expectations for the second consecutive quarter as bad loan provisions weighed

Provision for credit losses was $20.5 million in Q3, well above estimates of $8.3 million due to an increase in MSBI's loss given default assumptions on equipment finance portfolio

Bank has also ceased equipment finance production effective September 30

"We are encouraged by mgmt's decision to cease equipment finance production that should support lower future credit costs. We anticipate shares will underperform tomorrow given the credit-driven EPS miss" - brokerage Piper Sandler

All five brokerages covering the stock "hold"; median PT $20.50 - data compiled by LSEG

MSBI stock down 40% YTD