MB Financial : Reports Fourth Quarter 2018 Net Income

Section 1: 8-K (8-K)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): January 22, 2019

MB FINANCIAL, INC.

(Exact name of registrant as specified in its charter)

Maryland

(State or other jurisdiction of incorporation)

001-36599 (Commission File No.)

36-4460265

(IRS Employer Identification

No.)

800 West Madison Street, Chicago, Illinois 60607

(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: (888) 422-6562

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

• [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

• [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

• [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company [ ]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

Item 2.02 Results of Operations and Financial Condition

On January 22, 2019, MB Financial, Inc. issued a release containing its fourth quarter and annual 2018 results of operations. A copy of the release, including unaudited financial information contained therein, is attached as Exhibit 99.1 to this Current Report on Form 8-K and incorporated by reference herein.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

Exhibit 99.1 Release of MB Financial, Inc.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

MB FINANCIAL, INC.

Date:

January 18, 2019

By: /s/Randall T. Conte Randall T. Conte

Vice President and Chief Financial Officer (Principal Financial Officer)

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Section 2: EX-99.1 (EXHIBIT 99.1)

EXHIBIT 99.1

MB FINANCIAL, INC. REPORTS FOURTH QUARTER 2018 NET INCOME

CHICAGO, January 22, 2019 - MB Financial, Inc. (the "Company") (NASDAQ: MBFI), the holding company for MB Financial Bank, N.A., today announced fourth quarter 2018 net income of $75.9 million compared to $42.7 million last quarter and $144.2 million in the fourth quarter a year ago. Diluted earnings per common share were $0.85 in the fourth quarter of 2018 compared to $0.47 last quarter and $1.67 in the fourth quarter a year ago.

Annual net income for 2018 was $213.9 million compared to $304.0 million for 2017. Diluted earnings per common share were $2.55 for 2018 compared to $3.49 for 2017.

Net income and earnings per common share for the fourth quarter of 2017 and full year 2017 were positively impacted by a $104.2 million, or $1.23 per common share, tax benefit due to the enactment of the Tax Cuts and Jobs Act of 2017 (the "TCJ Act"). Net income and earnings per common share for the fourth and third quarters of 2018 were also positively impacted by TCJ Act tax benefits of $8.2 million, or $0.10 per common share, and $2.2 million, or $0.03 per common share, respectively.

The table below reconciles net income, as reported, to operating earnings excluding our Mortgage Banking Segment. As previously announced in April 2018, we have discontinued our national mortgage origination business (substantially all originations outside of the Company's consumer banking footprint in the Chicagoland area). Therefore, we believe operating earnings excluding our Mortgage Banking Segment better reflect our primary operations until the wind down of the segment is complete, as we are retaining the mortgage servicing asset and certain residential mortgageloans on our balance sheet and continue to originate residential mortgage loans in the Chicagoland area.

Year Ended

4Q18

3Q18

2Q18

1Q18

4Q17

December 31, 2018 2017

Net income - as reported Non-core items, net of tax (1) Operating earnings

Operating earnings (loss) - Mortgage Banking Segment

Operating earnings, excluding Mortgage Banking Segment

Dividends on preferred shares Operating earnings available to common stockholders, excluding Mortgage Banking Segment

• $ 75,911 (3,696) 72,215 3,141 69,074 3,000

  $

  42,714 12,889 55,603 1,067

  $

  38,533 18,679 57,212

  • $ 56,757

    • $ 144,194

      $

      614 (96,814)

      213,915 28,486

      • $ 304,040 (92,938)

        57,371 47,380

        242,401 211,102

        (3,359)

        (295) (815)

        54,536 3,000

        60,571 3,000

        57,666 48,195

        3,100 2,000

        554 5,494 241,847 205,608 12,100 8,007

• $ 66,074

• $ 51,536

• $ 57,571

• $ 54,566

• $ 46,195

  • $ 229,747

  • $ 197,601

    Diluted earnings per common share - as reported (2)

    Diluted operating earnings per common share, excluding Mortgage Banking Segment

    $ $

    0.85 0.77

    $ $

    0.47 0.60

    $ $

    0.42 0.68

    $ $

    0.81 0.64

• $ 1.67

• $ 0.54

$$

2.55 2.70

• $ 3.49

• $ 2.33

• (1) Non-core items represent the difference between non-core non-interest income and non-core non-interest expense net of tax as well as other non-core tax items. See "Non-GAAP Financial Information" section for details on non-core items starting on page 25.

• (2) The $0.81 diluted earnings per common share in the first quarter of 2018 were positively impacted by a $15.3 million, or $0.18 per common share, return from preferred stockholders due to the redemption of our 8% Series A non-cumulative perpetual preferred stock. The $15.3 million represents the excess carrying amount over the redemption price of the Series A preferred stock.