Exhibit 10.67

(M&I BANK LOGO) [c49677c4967706.gif]    

     
 
  M&I Marshall & Ilsley Bank
 
  770 North Water Street
 
  Milwaukee, WI 53202-3509
 
  414 765-7700
 
  mibank.com
 
   
 
  March 4, 2009

Ms. JoAnn Lilek
Executive Vice President and CFO
Midwest Banc Holdings, Inc.
501 West North Avenue
Melrose Park, Illinois 60160

         
 
  Re:   Waiver Letter.

Dear Ms. Lilek:
     Please make reference to that certain conditional waiver letter dated
September 23, 2008 (the “Prior Waiver Letter”).
     M&I Marshall & Ilsley Bank (“M&I”) and its participant hereby waive
compliance by Midwest Banc Holdings, Inc. (the “Company”) with the requirement
specified in the Prior Waiver Letter that the Company raise a minimum of
$100,000,000.00 in new capital pursuant to an offering of common or convertible
preferred stock in the Company.
     This limited waiver is contingent on the Company prepaying the principal
amount of the indebtedness owed to M&I and its participant by at least (i)
$5,000,000 on or before July 1, 2009, (ii) $5,000,000 on or before October 1,
2009, and (iii) $5,000,000 on or before January 4, 2010; provided, however, that
if the Company raises an additional $15,000,000 in new capital pursuant to an
offering of common or convertible preferred stock in the Company, then the
Company shall not be obligated to make any principal payment specified above
occurring after the date on which the Company actually receives such $15,000,000
in additional capital.
     If the Company fails to comply with the requirements of this waiver letter,
then this waiver shall be unilaterally withdrawn and of no further force and
effect. This limited waiver shall be effective only for the specific purposes
set forth herein, and shall not be deemed to be a further or continuing waiver
of any other section or provision of the Company’s loan documents with M&I

                  Very truly yours,    
 
                M&I MARSHALL & ILSLEY BANK    
 
           
 
  By:   /s/ John Kadlac    
 
  Name:  
 
John Kadlac    
 
  Title:   Vice President and Senior Relationship Manager