Why did MPB's Q2 earnings exceed forecasts?

Mid Penn Bancorp's (MPB) Q2 earnings exceeded forecasts due to several key factors:

1. **Strategic Financial Moves**: MPB's successful capital raise and impending merger with William Penn Bancorporation have bolstered its financial performance. These strategic moves have likely enhanced its market position and shareholder value, contributing to the strong earnings report.
2. **Loan and Deposit Growth**: The company reported a significant increase in total loans, which grew by $64.7 million, or 6.1% on an annualized basis, reaching a total of $706.1 million. Deposits also grew to $4.4 billion as of March 31, 2024, reflecting both organic and total deposits. This growth in loans and deposits has likely contributed to the higher income.
3. **Improved Net Interest Margin**: MPB's net interest margin improved to 3.21% for Q4 2024, up from 2.98% in Q4 2023. This improvement, coupled with a reduced cost of funds to 2.66%, has likely enhanced the company's profitability.
4. **Dividend Payments**: MPB has maintained a reputation for consecutive quarterly dividends, including the declaration of a $0.20 per share dividend in Q4, which is part of its streak of 57 consecutive quarterly dividends. While not directly related to earnings, the consistency of dividend payments can enhance investor confidence and the bank's financial stability perception, which might indirectly positively influence earnings expectations.
5. **Effective Cost Management**: The company's strategic focus on controlled loan growth and maintaining competitive deposit pricing has contributed to its strong performance. This suggests that MPB has effectively managed its costs, which has likely led to better-than-expected earnings.

In summary, Mid Penn Bancorp's Q2 earnings exceeded forecasts due to a combination of strategic financial moves, loan and deposit growth, improved net interest margin, consistent dividend payments, and effective cost management. These factors have collectively contributed to the company's robust financial performance.