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