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First Midwest reinvests in its future

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Michael L. Scudder, the son of a steelworker from Dixon, Illinois, was an accountant who worked his way up at First Midwest Bank.

By September 2008, Scudder was named the CEO to replace John O'Meara, who had passed away.

The next day, Lehman Brothers collapsed and sent the financial industry into turmoil.

It was no time to start a new era of leadership for those mourning at First Midwest and the industry's tailspin ahead, Scudder had no choice. Yet he felt buoyed that the bank was on solid ground.

"We had strong capital, good colleagues and a strong board at the time," Scudder said. "We also had earned many awards and had a solid reputation by this time. And you certainly find out who stands up or sits down at a time like that."

Itasca-based First Midwest became known as the stable bank, so much so that the FDIC gave its blessings to parent company First Midwest Bancorp Inc. to buy failing banks during the financial crisis, which led to one of the worst recessions in history. But that turmoil led to First Midwest building itself into an industry player throughout the Midwest with about 25 acquisitions under its belt and more expected.

The First Midwest buying spree has included Westmont-based First DuPage Bank in 2009, Peotone Bank and Palos Bank and Trust Co. in 2010, Waukegan Savings Bank in 2012, Peoples Bank in Arlington Heights and The National Bank & Trust Co. of Sycamore, both in 2015. The acquisition of Hickory Hills-based Standard Bank is expected to be complete within the next couple of months. That's when First Midwest is expected to close about 16 branches that includes both Standard Bank and First Midwest sites because of overlap. A final number of potential layoffs isn't known, because First Midwest is aiming to place the affected workers at other branches, Scudder said.

Now, First Midwest has garnered about $6 billion in assets and could reach $15 billion by the end of 2017. It also has about 2,200 employees at 110 branches around Chicago and the suburbs, including Arlington Heights, Buffalo Grove, Gurnee, Mundelein, among others. Branches also are in Northwest Indiana, Central and Western Illinois and Eastern Iowa. And more acquisitions could be coming, Scudder said.

First Midwest has made a name for itself in the industry, according to the Illinois Bankers Association.

"In fact, First Midwest was one of the Illinois Bankers Association's first winners of the Illinois Bank Community Service Award given to banks that go above and beyond in the area of community service," said Illinois Bankers spokeswoman Debbie Jemison.

First Midwest traces its roots to the Joliet region when 22 banks merged into the parent company called First Midwest Bancorp Inc. in 1982. It reached from Lake Forest to Palos Park to East Moline, Danville, Champaign and to Galesburg. A year later, the company started publicly trading on Nasdaq.

The company also diversified and bought National Machine Tool in 2014. It was an unusual move for a bank, but it has created a new revenue stream for leasing large pieces of equipment to manufacturers and other companies.

"It's not so much as acting outside of the box, it's staying true to who you are versus how you operated 10 years ago. You have to adjust to the environment," Scudder said.

That adjustment has allowed First Midwest to ease into mobile banking, offering customers the same opportunities as other banks to meet their needs for quick and easy transactions.

Besides the different avenues of revenue, First Midwest in September completed a sale of its 55 branch properties to Oak Street Real Estate Capital LLC for about $150.3 million. Now First Midwest leases back those properties from Oak Street for up to 14 years. This deal provides money that First Midwest can reinvest.

"Acquisitions are not a strategy," Scudder said. "It's an extension of that strategy or it's an accelerator."

First Midwest acquires National Bank & Trust of Sycamore

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First Midwest names new information, operations chief

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Jamieson joins First Midwest as director of commercial banking

First Midwest Bank donates land for Soldier's Home Build

  First Midwest CEO Mike Scudder talks about closing on the acquisition of Standard Bank and plans for more acquisitions. Daniel White/dwhite@dailyherald.com
  First Midwest Bank is headquartered at 1 Pierce Place in Itasca. Daniel White/dwhite@dailyherald.com
  First Midwest Bank CEO Mike Scudder guides the multibillion-dollar company from its Itasca headquarters. Daniel White/dwhite@dailyherald.com
  First Midwest Bank CEO Mike Scudder guides the multibillion-dollar company from its Itasca headquarters. Daniel White/dwhite@dailyherald.com
  First Midwest Bank CEO Mike Scudder guides the multibillion-dollar company from its Itasca headquarters. Daniel White/dwhite@dailyherald.com
  First Midwest Bank CEO Mike Scudder talks about his company's footprint throughout the Chicagoland area. Daniel White/dwhite@dailyherald.com
First Midwest Bank opened this branch, above, in downtown Joliet about a month ago. Will County will build a new $150 million courthouse on the site of the bank's former office in downtown Joliet. At left, First Midwest Bank marked its 30th anniversary on Nasdaq in 2013. COURTESY OF FIRST MIDWEST BANK
First Midwest Bank marked its 30th anniversary on Nasdaq in 2013. COURTESY OF FIRST MIDWEST BANK

First Midwest Bank

• Business: Personal and business banking services

• Parent company: First Midwest Bancorp Inc.

• Founded: 1982

• Leadership: First Midwest Bank Chairman & CEO Michael L. Scudder and President & Chief Operating Officer Mark G. Sander; First Midwest Bancorp Inc. President & CEO Michael L. Scudder

• Headquarters: Itasca

• Locations: 110 branches in Chicago and suburbs, Northwest Indiana, Central and Western Illinois and Eastern Iowa.

• Acquisitions: First DuPage Bank in 2009, Peotone Bank in 2010, Palos Bank and Trust Co. in 2010, Waukegan Savings Bank in 2012, Peoples Bank in Arlington Heights and The National Bank & Trust Co. of Sycamore, both in 2015. Hickory Hills-based Standard Bank expected to be completed by December or January. Also, National Machine Tool in 2014.

• Average deposits: $8 billion

• 3rd Quarter 2016 net income: $28.4 million, up from $23.3 million in same period a year ago

• Employees: 2,200

• Website: www.firstmidwest.com

• Facebook: www.facebook.com/FirstMidwest

• LinkedIn: www.linkedin.com/company/first-midwest-bank

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