Exhibit 99.1

Mid-Wisconsin Financial Services, Inc. Reports Second Quarter 2011 Financial Results

August 15, 2011

Medford, Wisconsin

Mid-Wisconsin Financial Services, Inc. (OTCBB:  MWFS.OB), the holding company (the “Company”) of Mid-Wisconsin Bank (the “Bank”) headquartered in Medford, WI, reported a net loss to common shareholders of  $882,000, or $0.53 per common share, for the six-month period ended June 30, 2011, compared to net income of $20,000, or $0.01 per common share, for the first six months of 2010.  The Company reported a net loss of $862,000, or $0.52 per common share for the second quarter ended June 30, 2011, compared to a net income of $168,000, or $0.10 per common share, for the second quarter ended June 30, 2010.

The Company’s financial results for the first six months of 2011 were impacted by higher levels of loan loss provisions, expenses related to credit collection efforts, expenses associated with a new deposit campaign, declining net interest margin, and the impact of recently enacted legislation on deposit service fees.  These factors were partially offset by a $500,000 legal settlement received in the first quarter, the details of which are subject to a confidentiality agreement.

Improving the Bank’s credit quality continues to be management’s primary focus. During the past twelve months we have shed nearly $20 million of problems credits. Our efforts have been challenging in light of the weak economic conditions that have prevailed in our primary markets. The level of delinquencies has stabilized; however, loan defaults and foreclosure activity have increased our cost of collection. The Company’s board and management believe that the process and metrics used in evaluating the adequacy of the allowance for loan and lease losses (the “ALLL”) is prudent and consistent with industry practices. During the second quarter we recognized net charge-offs of $2,383,000, which were partially offset by $1,900,000 in loan loss provisions. Total net charge-offs for the first six months of 2011 were $3,197,000 compared to net charge-offs of $1,960,000 for the first six months of 2010.  The increase in net charge-offs was mainly attributable to management’s decision, made in consultation with the banking regulators, to charge-off certain impaired loans that were covered by previously established specific reserves in the ALLL on selected accounts.  At June 30, 2011 the ALLL was $9,224,000 compared to $9,471,000 at December 31, 2010, and $8,352,000 at June 30, 2010. The coverage ratio of the ALLL to total loans was 2.68% at June 30, 2011, down slightly from the 2.79% reported at December 31, 2010, but an improvement over the 2.38% at June 30, 2010.  

Collection expenses continue to run above historical levels due to the increased number of foreclosures and other loan servicing costs. Our non-interest expenses also increased in part due to a $134,000 increase in FDIC expense due to increases in deposit insurance rates.

Like many other financial institutions, mortgage banking revenue declined by $65,000 during the first six months of 2011 due to the reduction in loan demand and decreased levels of re-financing activities.  We do not expect these conditions to improve significantly for the remainder of 2011.  Service fees were down $99,000 for the first six months of 2011 due to changes in consumers’ behavior patterns and recently enacted legislation which limits the amount banks can charge for certain services.    

During the second quarter of 2011, our net interest margin declined to 3.37% compared to 3.52% for the comparable period in 2010.  This decline was anticipated due to the increased levels of liquidity that were re-invested in short term investments, which generally carry lower yields.  Also, despite our aggressive collection efforts, non-accrual loans remain at historically high levels, which places additional pressure on the interest margin.  

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One of our key initiatives for 2011 is to increase core deposits and reduce our dependency on wholesale borrowings and brokered deposits, which generally represent a higher cost of funds.  On February 1, 2011 we introduced an innovative suite of new consumer deposit products based on various rewards.  The advertising campaign associated with this program resulted in higher levels of marketing expenses during the first six months of 2011.  These expenses are expected to taper off during the third and fourth quarters of 2011.  Our success in growing core deposits has enabled us to substantially reduce our reliance on wholesale funding sources.

We continue to experience weak loan demand from creditworthy borrowers in our local markets. The decline in quality loan demand, coupled with loan payoffs and charge-offs, has resulted in minimal loan growth of $4,672,000, or 1.4% at June 30, 2011 from $339,170,000 at December 31, 2010.  Competition among local and regional banks for creditworthy borrowers and core deposit customers remains high.  The Bank remains committed to its community banking philosophy and in serving the needs of its local markets by making available various government loan programs to creditworthy borrowers as opportunities arise.

At June 30, 2011 the Bank’s Tier One Capital Leverage ratio was 8.9% and its Total Risk Based Capital ratio 13.8%, compared to 9.0% and 13.9%, respectively, as of December 31, 2010.  The Company’s Tier One Capital Ratio was 10.0% and its Total Risk Based Capital Ratio was 15.4%, relatively unchanged from those reported at December 31, 2010.  All ratios are above the regulatory guidelines stipulated in the Bank’s and Company’s agreements with their primary regulators.  

As referenced in our 10-Q filing with the SEC during the third quarter of 2010, the Bank’s board of directors entered into a formal written agreement (the “Agreement”) on November 9, 2010 with the Federal Deposit Insurance Corporation (the “FDIC”) and the Wisconsin Department of Financial Institutions (the “WDFI”) to take certain actions and operate in compliance with the Agreement’s provisions during its term. The Agreement was based on the results of an examination of the Bank that was performed as of December 31, 2009 during the second quarter of 2010 by the FDIC and WDFI. At this time, the board believes it has satisfied most of the conditions of the Agreement and has taken appropriate actions necessary to resolve all other requirements referenced in the Agreement. As expected the Company entered into a similar agreement with similar restrictions with its primary regulator, the Federal Reserve Bank of Minneapolis, on May 10, 2011. Compliance with all requirements will be monitored on a monthly basis. In consultation with the Federal Reserve Bank of Minneapolis, on May 12, 2011, the Company exercised its rights to suspend dividends on the outstanding shares of preferred stock that is issued to the U.S. Department of the Treasury as a part of the Capital Purchase Program (the “TARP Preferred Stock”) and has elected to defer interest on its junior subordinated debentures (the “Debentures”) related to the trust preferred securities.  Consequently, the Company will not be able to pay dividends on its common stock until it has fully paid all accrued and unpaid dividends on the Debentures and the TARP Preferred Stock.

On July 21, 2010, President Obama signed into law the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Act”) which introduced 250 new banking regulations and 188 revisions to existing regulations, all of which are expected to be implemented within two years of the passage of the Act. “As anticipated this new legislation has added additional costs for compliance and effectively reduced the fees we now can collect for our banking services.  We continue to monitor developments with respect to the Act as they unfold, including the continued passage of rules implementing the Act’s provisions and their implications for the Company and the Bank.” reported James F. Warsaw, the Company’s President and CEO.

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Mid-Wisconsin Financial Services, Inc., headquartered in Medford, Wisconsin, is the holding company of Mid-Wisconsin Bank, which operates thirteen retail banking locations throughout central and northern Wisconsin, serving markets in Clark, Eau Claire, Lincoln, Marathon, Oneida, Price, Taylor and Vilas counties.  In addition to traditional loan and deposit products, the Bank offers trust, brokerage and private client services through its Wealth Management Services Group.

This press release contains forward-looking statements or comments that are provided to assist in the understanding of anticipated future financial performance. These forward-looking statements are not guarantees of future performance, nor should they be relied upon as representing management’s view as of any subsequent date. If the risks or uncertainties never materialize or the assumptions prove incorrect, our results may differ materially from those presented, either expressed or implied, in this press release.  All statements other than statements of historical fact are statements that could be deemed forward-looking statements.  Forward-looking statements may be identified by, among other things, expressions of beliefs or expectations that certain events may occur or are anticipated, and projections or statements of expectations.  Such forward-looking statements include, without limitation, statements regarding expected financial and operating activities and results that are preceded by, followed by, or that include words such as “may,” “expects,” “anticipates,” “estimates,” or “believes.” Such statements are subject to important factors that could cause Mid-Wisconsin’s actual results to differ materially from those anticipated by the forward-looking statements. These factors include: (i) Mid-Wisconsin’s exposure to the volatile commercial and residential real estate markets, which could result in increased charge-offs and increases in the allowance for loan losses to compensate for potential losses in its real estate portfolios or further write-downs of other real estate values; (ii) the effect of legislative and regulatory changes in banking laws and regulations and their application by the Company’s regulators; (iii) adverse changes in the financial performance and/or condition of Mid-Wisconsin’s borrowers, which could impact repayment of such borrowers’ outstanding loans; (iv) Mid-Wisconsin’s ability to maintain required levels of capital; (v) fluctuation in Mid-Wisconsin’s stock price; (vi) other risks and assumptions described in Mid-Wisconsin’s Annual Report on Form 10-K for the year ended December 31, 2010 under the headings “Forward-Looking Statements” and “Risk Factors” which are incorporated herein by reference; and (vii) such other factors as may be described in other Mid-Wisconsin filings with the Securities and Exchange Commission (“SEC”).  Forward-looking estimates and statements involve significant risks and uncertainties and actual results may differ materially from those presented, either expressed or implied, in this filing. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect only Mid-Wisconsin’s belief as of the date of this press release. Mid-Wisconsin specifically disclaims any obligation to update factors or to publicly announce the result of revisions to any of the forward-looking statements or comments included herein to reflect future events or developments except as required by federal securities law.  

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