ITASCA, IL -- (Marketwire) -- 08/27/09 -- First Midwest Bancorp, Inc. ("First Midwest" or the "Company") (NASDAQ: FMBI) today announced that, in order to enhance the Company's already strong capital position, it has commenced an offer to exchange any and all of the $100,000,000 outstanding principal amount of the Company's 5.85% Subordinated Notes due 2016 (the "Notes") and a separate offer to exchange any and all of the $125,000,000 outstanding liquidation amount of the 6.95% Capital Securities (the "Capital Securities") issued by First Midwest Capital Trust I for newly issued shares of common stock of the Company. These exchange offers are two separate transactions, and neither is conditioned on the completion of the other.

The exchange offers represent an efficient opportunity to strengthen the composition of First Midwest's capital base by increasing its Tier 1 common and tangible common equity ratios, while also reducing the dividend and interest expense associated with the debt securities. By increasing its common equity component, First Midwest expects to have increased capital flexibility to take advantage of market opportunities and implement its long-term strategies.

Each exchange offer will expire at 11:59 p.m., New York City time, on September 24, 2009 (the "Expiration Date"), and each will have an early tender period (the "Early Tender Period") that expires at 5:00 p.m. New York City time, on September 10, 2009. We may extend the Expiration Date or Early Tender Period for either offer or both offers, and we may terminate either offer or both offers early.

For each $1,000 liquidation amount of Capital Securities accepted in accordance with the terms of the Capital Securities exchange offer, First Midwest will issue a number of shares of its common stock equal to $750, plus an early tender premium of $50 for Capital Securities tendered during the Early Tender Period and not withdrawn, divided by the Relevant Price (as defined below). No early tender premium will be paid for Capital Securities tendered after the Early Tender Period. For each exchange offer, "Relevant Price" means the simple arithmetic average of the daily per share volume weighted average price (VWAP) of First Midwest's common stock for each of the five consecutive trading days ending on the second trading day immediately preceding the Expiration Date of that exchange offer (the "Pricing Date"). The Company will issue no more than 7.5 million shares of its common stock in the Capital Securities exchange offer, and will prorate tendered Capital Securities as necessary to remain within this limit.