About Mid Penn Bancorp

Mid Penn Bancorp, Inc. (Mid Penn) operates as the bank holding company for Mid Penn Bank that provides various financial products and services. The company engages in a full-service commercial banking and trust business, making available to the community a wide range of financial services, including but not limited to, mortgage and home equity loans, secured and unsecured commercial and consumer loans, lines of credit, construction financing, farm loans, community development loans, loans to non-profit entities and local government loans, and various types of time and demand deposits, including but not limited to, checking accounts, savings accounts, clubs, money market deposit accounts, certificates of deposit, and IRAs. In addition, the bank provides a full range of trust and wealth management services through its Trust Department. Deposits are insured by the Federal Deposit Insurance Corporation (FDIC) to the extent provided by law. Mid Penn also provides wealth management services, through its nonbank subsidiary, MPB Wealth Management, LLC, and fulfills the insurance needs of both existing and potential customers through MPB Risk Services, LLC, doing business as MPB Insurance and Risk Management. The financial services are provided to individuals, partnerships, non-profit organizations, and corporations through its retail banking offices located in throughout Pennsylvania. The bank also offers other services, such as online banking, telephone banking, cash management services, automated teller services, and safe deposit boxes. On December 30, 2022, Mid Penn purchased the assets of Managing Partners, Inc. (‘MPI Acquisition’) in a business combination. Managing Partners, Inc. was an independent insurance agency that serviced the Central Pennsylvania area. The company has full-service retail banking locations in the Pennsylvania counties of Berks, Blair, Bucks, Centre, Chester, Clearfield, Cumberland, Dauphin, Fayette, Huntingdon, Lancaster, Lehigh, Luzerne, Lycoming, Montgomery, Northumberland, Perry, Schuylkill and Westmoreland. Mid Penn has no branches or offices located outside of the Commonwealth of Pennsylvania. Business Strategy The bank provides services to commercial businesses and real estate investors, consumers, nonprofit organizations, and municipalities through its full-service retail banking properties, loan production office, wealth management office, corporate administrations office, and operations facility, which are all based in Pennsylvania. Mid Penn’s primary markets reflect a diversified manufacturing and services base across nineteen Pennsylvania counties, including having several offices in and around the state capital region of Harrisburg. The bank emphasizes developing long-term customer relationships, maintaining high quality service, and providing prompt responses to customer needs. Lending Activities The bank offers a variety of loan products to its customers, including commercial real estate loans, residential real estate loans, commercial and industrial loans, and consumer loans. As of December 31, 2022, the bank’s highest concentration of credit was in commercial real estate. Investment Activities Mid Penn maintains both a held-to-maturity investment portfolio and an available-for-sale investment portfolio. Both portfolios are consisted primarily of lower-risk debt securities, including the U.S. Treasury and the U.S. government agencies, mortgage-backed U.S. government agencies, investment-grade municipal securities, and corporate bonds. Deposits and Other Sources of Funds The bank primarily uses deposits and, to a lesser extent, wholesale borrowings to finance lending and investment activities. Wholesale borrowing sources include advances from the Federal Home Loan Bank of Pittsburgh (the ‘FHLB’), overnight borrowings from the bank’s other correspondent banking relationships, and advances from the Federal Reserve’s Discount Window. Supervision and Regulation Mid Penn is a registered financial holding company subject to supervision and regulation by the Federal Reserve. As such, it is subject to the bank Holding Company Act of 1956 (‘BHCA’) and many of the Federal Reserve’s regulations promulgated thereunder. The Federal Reserve has broad enforcement powers over financial and bank holding companies, including the power to impose substantial fines and civil penalties. As a Pennsylvania-chartered, non-member bank, the bank is subject to supervision, regulation and examination by both the Pennsylvania Department of Banking and Securities and the FDIC. The deposits of the bank are insured by the FDIC to the maximum extent provided by law. The FDIC insures deposits of the bank through the Deposit Insurance Fund (DIF). A number of laws govern the relationship between the bank and its customers. For example, the Community Reinvestment Act is designed to encourage services, investments, and lending activities in low- and moderate-income areas. The Home Mortgage Disclosure Act and the Equal Credit Opportunity Act attempt to minimize lending decisions based on impermissible criteria, such as race or gender. The Truth-in-Lending Act and the Truth-in-Savings Act require banks to provide certain disclosure of relevant terms related to loans and savings accounts, respectively. Anti-tying restrictions (which prohibit conditioning the availability or terms of credit on the purchase of another banking product) further restrict the bank’s relationships with its customers. The bank maintains a comprehensive compliance management program to promote its compliance with these and other applicable consumer protection laws and regulations. Transactions between the bank and the company, and/or its nonbank subsidiary affiliates are governed by Sections 23A and 23B of the Federal Reserve Act. Under Title III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA Patriot Act), also known as the International Money Laundering Abatement and Anti-Terrorism Financing Act of 2001, all financial institutions, including Mid Penn and the bank, are required in general to identify their customers, adopt formal and comprehensive anti-money laundering programs, scrutinize or prohibit altogether certain transactions of special concern, and be prepared to respond to inquiries from U.S. law enforcement agencies concerning their customers and their transactions. The bank has adopted policies, procedures and controls to address compliance with the requirements of the USA Patriot Act under the existing regulations. Certain changes implemented by the Jumpstart Our Business Startups Act that impacted Mid Penn included raising the threshold requiring registration under the Securities Exchange Act of 1934 (the ‘Exchange Act’) for banks and bank holdings companies from 500 to 2,000 holders of record; and raising the threshold for triggering deregistration under the Exchange Act for banks and bank holding companies from 300 to 1,200 holders of record. The Sarbanes-Oxley Act of 2002 (‘SOX’) and related rules and regulations adopted by the SEC and NASDAQ addressed the following issues: corporate governance, auditor independence and accounting standards, executive compensation, insider loans, whistleblower protection, and enhanced and timely disclosure of corporate information. Mid Penn has established policies, procedures, and systems designed to promote compliance with these regulations. The bank remains subject to independent auditor attestation under FDIC regulation 363.3(b), which is a similar independent attestation requirement at the bank level. Mid Penn’s common stock is registered under Section 12(b) of the Exchange Act and is traded on NASDAQ under the trading symbol MPB. Mid Penn is subject to the informational requirements of the Exchange Act, and, accordingly, files reports, proxy statements and other information with the SEC. Mid Penn is an electronic filer with the SEC. History Mid Penn Bancorp, Inc. was founded in 1868. The company was incorporated in the Commonwealth of Pennsylvania in 1991.