Midwest Bank Responds to Market Concerns (MBHI)

Midwest Banc Holdings, Inc. (NASDAQ: MBHI) has issued a response to dimish fears about its holdings of Fannie Mae and Freddie Mac.  This was in direct response to news surrounding the US government takeover of Freddie Mac and Fannie Mae.  The bank announced that under all regulatory guidelines
Midwest Bank & Trust Company it remains well-capitalized. 

Midwest Bank said it would remain well-capitalized even if the value ofits preferred stock investments in Freddie Mac and Fannie Mae werereduced to zero.  The company also said the bank will monitor thesituation and is committed stay well capitalized.

This was one of the banks which analysts and reports have said mightbe at risk because of their capital requirements and financial ratiosafter the preferred stock of Fannie and Freddie are being knocked outin the government seizure of the GSE’s.  Shares are still down over 23% at $4.58 inlate afternoon trading.  It has seen nearly 900,000 shares trade handscompared to an average of only about 180,000 shares per day.  Its52-week trading range was $4.09 to $15.90, although its stock traded aslow as $3.69 today.

As a reminder, these are the bank’s claims rather than an independent claim.

Jon C. Ogg
September 8, 2008