MidWestOne Financial Group (MidWestOne Financial Group) Probability of Financial Distress (%) : 0.14% (As of Apr. 28, 2024)

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What is MidWestOne Financial Group Probability of Financial Distress (%)?

Probability of Financial Distress (%) measures the probability that a company will go bankrupt in the upcoming year given its current financial position. A higher ratio indicates a larger probability of bankruptcy for the company, while a lower ratio indicates a healthier fundamental. As of today, MidWestOne Financial Group's Probability of Financial Distress (%) is 0.14%.

Like the Altman Z-Score, the PFD measures a company's bankruptcy risk. However, the main drawback of the Z-score is it does not apply to banks and insurance companies. According to Investopedia, the concept of "working capital" does not apply to banks and insurance companies, as financial institutions do not have typical current assets or current liabilities like inventories or accounts payable.

Competitive Comparison of MidWestOne Financial Group's Probability of Financial Distress (%)

For the Banks - Regional subindustry, MidWestOne Financial Group's Probability of Financial Distress (%), along with its competitors' market caps and Probability of Financial Distress (%) data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

MidWestOne Financial Group's Probability of Financial Distress (%) Distribution in the Banks Industry

For the Banks industry and Financial Services sector, MidWestOne Financial Group's Probability of Financial Distress (%) distribution charts can be found below:

* The bar in red indicates where MidWestOne Financial Group's Probability of Financial Distress (%) falls into.

MidWestOne Financial Group Probability of Financial Distress (%) Calculation

Probability of Financial Distress (%) (PFD) was developed by John Campbell, Jens Hilscher and Jan Szilagyi in their Search of Distress Risk. It measures the probability that a company will go bankrupt within the next 12 months given its current financial position.

The Probability of Financial Distress (%) was obtained by a logit probability model based on eight explanatory variables. The logit formula to compute the probability of financial distress (LPFD) is given below:

LPFD

-20.12 * NIMTAAVG

1.60 * TLMTA

7.88 * EXRETAVG

1.55 * SIGMA

0.005 * RSIZE

2.27 * CASHMTA

0.070 * MB

0.09 * PRICE

8.87

-6.59

The Probability of Financial Distress (%) (PFD) was then obtianed by:

PFD	=	1	/	(1 + e^(-LPFD))	*	100%
	=	0.14%

The eight explanatory variables are:

1. NIMTAAVG = Net Income to Market Total Assets

NIMTAAVG	=	Net Income	/	Market Total Assets
	=	Net Income	/	(Market Cap + Total Liabilities)

*Note that for companies reported quarterly, geometrically declining weighted quarterly Net Income data in latest four quarters are used.

2. TLMTA = Total liabilities to Market Total Assets

TLMTA

Total Liabilities

Market Total Assets

3. CASHMTA = Cash to Market Total Assets

For banks, CASHMTA is measured as:

CASHMTA

(Balance Sheet Cash And Cash Equivalents + Money Market Investments)

Market Total Assets

4. EXRETAVG = Excess Return compared to the S&P 500

EXRETAVG is the weighted excess return compared to the S&P 500 in past 12 month. Geometrically declining weights are imposed on the monthly excess return to reflect lagged information. The weight is halved each quarter.

5. SIGMA = Standard Deviation of Daily Returns

For sigma, we use the annualized standard deviation of a company's returns over the past 92 days (or 63 trading days).

6. RSIZE = Relative Size

RSIZE

log (Market Cap

Total Market Cap of S&P 500 companies)

7. MB = Market to Adjusted Book Equity Ratio

MB	=	Market Cap	/	Adjusted Book Equity
	=	Market Cap	/	(Total Stockholders Equity + 0.1 * ( Market Cap - Total Stockholders Equity))

8. PRICE

PRICE is measured as the log of the stock price, capped at log(15).

MidWestOne Financial Group (NAS:MOFG) Probability of Financial Distress (%) Explanation

Like the Altman Z-Score, the PFD measures a company's bankruptcy risk in the upcoming year. However, the main drawback of the Z-score is it does not apply to banks and insurance companies. According to Investopedia, the concept of "working capital" does not apply to banks and insurance companies, as financial institutions do not have typical current assets or current liabilities like inventories or accounts payable.

MidWestOne Financial Group Probability of Financial Distress (%) Related Terms

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MidWestOne Financial Group (MidWestOne Financial Group) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Banks » MidWestOne Financial Group Inc (NAS:MOFG) » Definitions » Probability of Financial Distress (%)

Comparable Companies

Traded in Other Exchanges

N/A

Address

102 South Clinton Street, Iowa City, IA, USA, 52240

Website

http://www.midwestone.com

MidWestOne Financial Group Inc is a bank holding company engaged in delivering relationship-based business and personal banking products and services. The Bank provides commercial loans, real estate loans, agricultural loans, credit card loans, and consumer loans. It also provides deposit products including demand and interest checking accounts, savings accounts, money market accounts, and time deposits. The Bank also provides products and services including treasury management, Zelle, online and mobile banking, debit cards, ATMs, and safe deposit boxes. The Bank offers its products and services through its network of full-service banking offices. the Bank's investments services department offers financial planning, investment advisory, and retail securities brokerage services.

Executives

Janet E Godwin	director	102 S CLINTON STREET, P.O. BOX 1700, IOWA CITY IA 52244-1700
Nathaniel J Kaeding	director	102 S CLINTON STREET, P.O. BOX 1700, IOWA CITY IA 52244-1700
Ruth E Stanoch	director	102 S. CLINTON STREET, P.O. BOX 1700, IOWA CITY IA 52244-1700
Charles N Reeves	director, officer: Chief Executive Officer	102 S. CLINTON STREET, P.O. BOX 1700, IOWA CITY IA 52244-1700
Larry D Albert	director, officer: Executive Vice President	102 S. CLINTON STREET, P.O. BOX 1700, IOWA CITY IA 52244-1700
Matthew J Hayek	director	102 S CLINTON STREET, P.O. BOX 1700, IOWA CITY IA 52244-1700
Tracy S Mccormick	director	102 S. CLINTON STREET, P.O. BOX 1700, IOWA CITY IA 52244-1700
Jennifer Leigh Hauschildt	director	102 S CLINTON STREET, P.O. BOX 1700, IOWA CITY IA 52244-1700
Kevin W Monson	director	102 S. CLINTON STREET, P.O. BOX 1700, IOWA CITY IA 52244-1700
Len D Devaisher	officer: President and COO	102 S CLINTON STREET, P.O. BOX 1700, IOWA CITY IA 52244-1700
David E Lindstrom	officer: EVP, Consumer Banking	102 S CLINTON STREET, P.O. BOX 1700, IOWA CITY IA 52244-1700
John J Ruppel	officer: Chief Accounting Officer	102 S. CLINTON STREET, P.O. BOX 1700, IOWA CITY IA 52244-1700
Charles N Funk	director, officer: President and CEO	102 S. CLINTON STREET, P.O. BOX 1700, IOWA CITY IA 52244-1700
Kurt R Weise	director, officer: Executive Vice President	102 S. CLINTON STREET, P.O. BOX 1700, IOWA CITY IA 52244-1700
Douglas K True	director	102 S CLINTON STREET, P.O. BOX 1700, IOWA CITY IA 52244-1700