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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 
 FORM 10-QSB
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended September 30, 2007
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission File Number 1-14343
 MIDLAND CAPITAL HOLDINGS CORPORATION
  Delaware
(State or Other Jurisdiction of 
Incorporation or Organization)
    
    36-4238089
(I.R.S. Employer
Identification Number)
 8929 S. Harlem Avenue, Bridgeview, Illinois 60455
 (708) 598-9400
 þ o
 o þ
 o þ
  Common Stock, par value $.01
 As of November 14, 2007, the Issuer had
372,600 shares of Common Stock issued and outstanding.




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MIDLAND CAPITAL HOLDINGS CORPORATION
  
 PAGEPart I. FINANCIAL INFORMATIONItem 1. Financial StatementsConsolidated Statements of Financial Condition  September 30, 2007 (unaudited) and June 30, 2007
    
    
    1Consolidated Statements of Earnings  Three Months Ended September 30, 2007 and 2006 (unaudited)
    
    
    2Consolidated Statements of Changes in Stockholders Equity  Three Months Ended September 30, 2007 (unaudited)
    
    
    3Consolidated Statements of Cash Flows  Three Months Ended September 30, 2007 and 2006 (unaudited)
    
    
    4Notes to Consolidated Financial Statements
    
    
    5-6Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    7-13Item 3. Controls and Procedures
    
    
    13Part II. OTHER INFORMATION
    
    
    14Item 1. Legal Proceedings
    
    
    14Item 2. Changes in Securities
    
    
    14Item 3.
Defaults Upon Senior Securities
    
    
    14Item 4.
Submission of Matters to a Vote of Security Holders
    
    
    14Item 5.
Other Information
    
    
    14Item 6.
Exhibits
    
    
    14Index
to Exhibits
    
    
    15Exhibit 11Exhibit 31.1Exhibit 32.1




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MIDLAND CAPITAL HOLDINGS CORPORATION  AND SUBSIDIARIES
 
 Part I  FINANCIAL INFORMATION
 
 Consolidated Statements of Financial Condition
 September 30,
    
    
    June 30,2007
    
    
    2007(Unaudited)AssetsCash and amounts due from depository institutions
    
    $
    1,982,224
    
    
    
    2,224,076Interest-bearing deposits
    
    
    16,782,732
    
    
    
    11,231,760Total cash and cash equivalents
    
    
    18,764,956
    
    
    
    13,455,836Investment securities available for sale, at fair value
    
    
    16,063,331
    
    
    
    21,019,975Mortgage-backed securities, held to maturity (fair value:September 30, 2007 - $1,361,863;June 30, 2007 - $1,482,977)
    
    
    1,351,683
    
    
    
    1,474,504Loans receivable (net of allowance for loan losses:September 30, 2007 - $419,701;June 30, 2007 - $420,079)
    
    
    83,103,788
    
    
    
    83,844,418Loans receivable held for sale
    
    
    1,026,400
    
    
    
    1,012,200Other Investments  available for sale, at fair value
    
    
    41,835
    
    
    
    106,633Stock in Federal Home Loan Bank of Chicago
    
    
    1,148,087
    
    
    
    1,148,087Accrued interest receivable
    
    
    373,795
    
    
    
    333,666Office properties and equipment, net
    
    
    2,030,377
    
    
    
    2,071,621Prepaid expenses and other assets
    
    
    647,179
    
    
    
    425,814Total assets
    
    $
    124,551,431
    
    
    
    124,892,754Liabilities and Stockholders EquityLiabilities:Deposits
    
    $
    108,855,151
    
    
    
    109,744,662Advance payments by borrowers for taxes and insurance
    
    
    1,318,448
    
    
    
    998,142Other liabilities
    
    
    564,574
    
    
    
    439,476Total liabilities
    
    
    110,738,173
    
    
    
    111,182,280Stockholders equity:Preferred stock, $.01
par value: authorized 50,000 shares;
none outstanding
    
    
    
    
    
    
    Common stock, $.01 par value: authorized 600,000
shares; issued and outstanding 372,600 shares
at September 30, 2007 and June 30, 2007
    
    
    3,726
    
    
    
    3,726Additional paid-in capital
    
    
    3,395,580
    
    
    
    3,395,580Retained earnings  substantially restricted
    
    
    10,206,251
    
    
    
    10,104,065Accumulated other comprehensive income, net of income taxes
    
    
    207,701
    
    
    
    207,103Total stockholders equity
    
    
    13,813,258
    
    
    
    13,710,474Total liabilities and stockholders equity
    
    $
    124,551,431
    
    
    
    124,892,754
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MIDLAND CAPITAL HOLDINGS CORPORATION  AND SUBSIDIARIES
 
 Consolidated Statements of Earnings (Unaudited)
 Three Months EndedSeptember 30,2007
    
    
    2006Interest income:Interest on loans
    
    $
    1,241,260
    
    
    
    1,349,977Interest on mortgage-backed securities
    
    
    20,016
    
    
    
    21,758Interest on investment securities
    
    
    240,233
    
    
    
    259,544Interest on interest-bearing deposits
    
    
    166,992
    
    
    
    107,597Dividends on FHLB stock
    
    
    8,014
    
    
    
    8,873Total interest income
    
    
    1,676,515
    
    
    
    1,747,749Interest expense:Interest on deposits
    
    
    561,807
    
    
    
    492,674Total interest expense
    
    
    561,807
    
    
    
    492,674Net interest income
    
    
    1,114,708
    
    
    
    1,255,075Provision for loan losses
    
    
    
    
    
    
    Net interest income after provision for loan losses
    
    
    1,114,708
    
    
    
    1,255,075Non-interest income:Loan fees and service charges
    
    
    49,970
    
    
    
    51,166Gain on sale of other investments
    
    
    66,726
    
    
    
    Commission income
    
    
    16,275
    
    
    
    11,594Gain on sale of loans
    
    
    35,735
    
    
    
    26,296Deposit related fees
    
    
    79,255
    
    
    
    94,892Other income
    
    
    13,864
    
    
    
    13,457Total non-interest income
    
    
    261,825
    
    
    
    197,405Non-interest expense:Staffing costs
    
    
    619,698
    
    
    
    657,221Advertising
    
    
    16,206
    
    
    
    17,895Occupancy and equipment expenses
    
    
    166,120
    
    
    
    165,645Data processing
    
    
    44,076
    
    
    
    44,008Federal deposit insurance premiums
    
    
    3,241
    
    
    
    3,704Other
    
    
    236,895
    
    
    
    228,795Total non-interest expense
    
    
    1,086,236
    
    
    
    1,117,268Income before income taxes
    
    
    290,297
    
    
    
    335,212Income tax provision
    
    
    98,687
    
    
    
    113,972Net income
    
    $
    191,610
    
    
    
    221,240Earnings per share (basic)
    
    $
    0.51
    
    
    
    0.59Earnings per share (diluted)
    
    $
    0.51
    
    
    
    0.59Dividends declared per common share
    
    $
    0.24
    
    
    
    0.24
   -2-




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MIDLAND CAPITAL HOLDINGS CORPORATION  AND SUBSIDIARIES
 
 Consolidated Statements of Changes in Stockholders Equity (Unaudited)
 AccumulatedAdditional
    
    
    
    
    
    
    OtherCommon
    
    
    Paid-In
    
    
    Retained
    
    
    ComprehensiveStock
    
    
    Capital
    
    
    Earnings
    
    
    Income
    
    
    TotalBalance at June 30, 2007
    
    $
    3,726
    
    
    
    3,395,580
    
    
    
    10,104,065
    
    
    
    207,103
    
    
    
    13,710,474Comprehensive Income:Net income
    
    
    
    
    
    
    
    
    
    
    191,610
    
    
    
    
    
    
    
    191,610Other comprehensive
income, net of tax:Unrealized holding gain
during the period
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    42,820
    
    
    
    42,820Reclassification
adjustment of
gain included
in net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (42,222
    )
    
    
    (42,222
    )Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    191,610
    
    
    
    598
    
    
    
    192,208Dividends declared
on common
stock
($0.24 per share)
    
    
    
    
    
    
    
    
    
    
    (89,424
    )
    
    
    
    
    
    
    (89,424
    )Balance at September
30, 2007
    
    $
    3,726
    
    
    
    3,395,580
    
    
    
    10,206,251
    
    
    
    207,701
    
    
    
    13,813,258
   -3-




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MIDLAND CAPITAL HOLDINGS CORPORATION  AND SUBSIDIARIES
 
 Consolidated Statements of Cash Flows (Unaudited)
 Three Months EndedSeptember 30,2007
    
    
    2006Cash flows from operating activities:Net income
    
    $
    191,610
    
    
    
    221,240Adjustments to reconcile net income to net cash from
operating activities:Depreciation
    
    
    55,380
    
    
    
    56,347Net accretion on securities
    
    
    (221,423
    )
    
    
    (240,794
    )Proceeds from sale of loans held for sale
    
    
    2,906,378
    
    
    
    2,115,888Origination of loans held for sale
    
    
    (2,898,300
    )
    
    
    (1,654,050
    )Gain on sale of loans
    
    
    (35,735
    )
    
    
    (26,296
    )Gain on sale of other investments
    
    
    (66,726
    )
    
    
    Increase in accrued interest receivable
    
    
    (40,129
    )
    
    
    (12,028
    )Decrease in accrued interest payable
    
    
    (801
    )
    
    
    (750
    )Increase in deferred income on loans
    
    
    7,542
    
    
    
    11,364Increase in other assets
    
    
    (208,216
    )
    
    
    (234,600
    )Increase in other liabilities
    
    
    125,899
    
    
    
    2,671Net cash provided (for) by operating activities
    
    
    (184,521
    )
    
    
    238,992Cash flows from investing activities:Proceeds from repayments of mortgage-backed securities,
held to maturity
    
    
    122,821
    
    
    
    61,875Proceeds from maturities of investment securities,
available for sale
    
    
    15,000,000
    
    
    
    15,000,000Purchase of investment securities, available for sale
    
    
    (9,757,333
    )
    
    
    (14,619,190
    )Loan disbursements
    
    
    (2,118,586
    )
    
    
    (3,044,838
    )Loan repayments
    
    
    2,851,674
    
    
    
    4,502,863Proceeds from sale of other investments
    
    
    67,830
    
    
    
    Property and equipment expenditures
    
    
    (14,136
    )
    
    
    (10,930
    )Net cash provided by (for) investing activities
    
    
    6,152,270
    
    
    
    1,889,780Cash flows from financing activities:Deposit account receipts
    
    
    74,604,836
    
    
    
    79,945,771Deposit account withdrawals
    
    
    (76,019,059
    )
    
    
    (84,929,223
    )Interest credited to deposit accounts
    
    
    524,712
    
    
    
    457,426Payment of dividends
    
    
    (89,424
    )
    
    
    (89,424
    )Increase (decrease) in advance payments by borrowers
for taxes and insurance
    
    
    320,306
    
    
    
    (703,806
    )Net cash provided for financing activities
    
    
    (658,629
    )
    
    
    (5,319,256
    )Net change in cash and cash equivalents
    
    
    5,309,120
    
    
    
    (3,190,484
    )Cash and cash equivalents at beginning of period
    
    
    13,455,836
    
    
    
    11,259,904Cash and cash equivalents at end of period
    
    $
    18,764,956
    
    
    
    8,069,420Cash paid during the period for:Interest
    
    $
    562,608
    
    
    
    493,424Income taxes
    
    
    3,924
    
    
    
    85,606
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MIDLAND CAPITAL HOLDINGS CORPORATION
AND SUBSIDIARIES
 
 Notes to Consolidated Financial Statements
 Note A  Basis of Presentation
  Note B  Principles of Consolidation
  Note C  Earnings Per Share
  Note D  Industry Segments
  Note E  Effect of New Accounting Pronouncements
   -5-




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MIDLAND CAPITAL HOLDINGS CORPORATION
AND SUBSIDIARIES
 Note E  Effect of New Accounting Pronouncements (continued)
    -6-




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MIDLAND CAPITAL HOLDINGS CORPORATION
AND SUBSIDIARIES
 
 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 FORWARD-LOOKING STATEMENTS
    GENERAL
     -7-




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MIDLAND CAPITAL HOLDINGS CORPORATION
AND SUBSIDIARIES
 FINANCIAL CONDITION
        -8-




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MIDLAND CAPITAL HOLDINGS CORPORATION
AND SUBSIDIARIES
 FINANCIAL CONDITION (continued)
  September 30,
    
    
    June 30,2007
    
    
    2007(Dollars in Thousands)Non-Accruing Loans:One-to-four family
    
    $
    483
    
    
    $
    484Multi-family
    
    
    
    
    
    
    Consumer
    
    
    33
    
    
    
    27Commercial business
    
    
    
    
    
    
    Total non-performing loans
    
    $
    516
    
    
    $
    511Foreclosed Assets:One-to-four family
    
    
    
    
    
    
    Total foreclosed assets
    
    
    
    
    
    
    Total non-performing assets
    
    $
    516
    
    
    $
    511Total as a percentage of total assets
    
    
    0.41
    %
    
    
    0.41
    %
   -9-




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MIDLAND CAPITAL HOLDINGS CORPORATION
AND SUBSIDIARIES
 FINANCIAL CONDITION (continued)
  Three Months EndedSeptember 30,2007
    
    
    2006(Dollars in Thousands)Balance at beginning of period
    
    $
    420
    
    
    $
    416Charge-offs:One-to-four family loans
    
    
    
    
    
    
    Consumer loans
    
    
    
    
    
    
    Commercial business loans
    
    
    
    
    
    
    Total charge-offs
    
    
    
    
    
    
    Recoveries:One-to-four family loans
    
    
    
    
    
    
    Multi-family loans
    
    
    
    
    
    
    Consumer loans
    
    
    
    
    
    
    6Total recoveries
    
    
    
    
    
    
    6Net (charge-offs) recoveries
    
    
    
    
    
    
    6Additions charged to operations
    
    
    
    
    
    
    Balance at end of period
    
    $
    420
    
    
    $
    422Ratio of net charge-offs during the period to
average loans outstanding during the period
    
    
    
    %
    
    
    
    %Ratio of net charge-offs during the period to
average non-performing assets
    
    
    
    %
    
    
    
    %Allowance for loan losses to non-performing loans
    
    
    81.34
    %
    
    
    151.73
    %Allowance for loan losses to total loans
    
    
    0.50
    %
    
    
    0.46
    %
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MIDLAND CAPITAL HOLDINGS CORPORATION
AND SUBSIDIARIES
 RESULTS OF OPERATIONS
   Interest Income
      -11-




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MIDLAND CAPITAL HOLDINGS CORPORATION
AND SUBSIDIARIES
 Interest Income (continued)
  Interest Expense
  Provisions for Losses on Loans
  Non-Interest Income
  Non-Interest Expense
   -12-




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MIDLAND CAPITAL HOLDINGS CORPORATION
AND SUBSIDIARIES
 Income Taxes
  LIQUIDITY AND CAPITAL RESOURCES
     
 Item 3. CONTROLS AND PROCEDURES
    -13-




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MIDLAND CAPITAL HOLDINGS CORPORATION AND SUBSIDIARIES
 
 PART II  OTHER INFORMATION
 
 Item 1. LEGAL PROCEEDINGS
  
 Item 2. CHANGES IN SECURITIES
  
 Item 3. DEFAULTS UPON SENIOR SECURITIES
  
 Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  
 Item 5. OTHER INFORMATION
  
 Item 6. EXHIBITS
   -14-




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INDEX TO EXHIBITS
 ExhibitNumber
    
    Description11
    
    Computation of Per Share Earnings31.1
    
    Rule 13a-14(a)/15d-14(a) Certification32.1
    
    Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
  -15-




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SIGNATURES
  MIDLAND CAPITAL HOLDINGS CORPORATIONRegistrantDATE: November 14, 2007

    BY:  /s/ Paul ZogasPaul ZogasPresident, Chief Executive Officerand Chief Financial Officer