Independent Bank Corporation Reports 2023 Third Quarter Results

Rhea-AI Summary

Independent Bank Corporation reports net income of $17.5 million for Q3 2023, an increase from the prior-year period. Net growth in core deposits and loans. President and CEO comments on positive momentum and solid balance sheet growth. Non-interest income decreases due to variances in mortgage banking revenues.

Positive

• Increase in net interest income of $1.1 million (2.8%) over Q2 2023
• Net growth in core deposits of $112.6 million (10.5% annualized)
• Net growth in loans of $110.4 million (12.1% annualized)
• Payment of a 23 cent per share dividend on common stock
• Solid balance sheet growth, stable net interest margin, disciplined expense management, and healthy asset quality
• Double-digit annualized growth in loans and deposits

Negative

• Decrease in non-interest income due to variances in mortgage banking revenues

Third Quarter Highlights

Highlights for the third quarter of 2023 include:

• An increase in net interest income of $1.1 million (2.8%) over the second quarter of 2023;
• Net growth in core deposits of $112.6 million (or 10.5% annualized) from June 30, 2023;
• Net growth in loans of $110.4 million (or 12.1% annualized) from June 30, 2023; and
• The payment of a 23 cent per share dividend on common stock on August 14, 2023.
  
  

GRAND RAPIDS, Mich., Oct. 24, 2023 (GLOBE NEWSWIRE) -- Independent Bank Corporation (NASDAQ: IBCP) reported third quarter 2023 net income of $17.5 million, or $0.83 per diluted share, versus net income of $17.3 million, or $0.81 per diluted share, in the prior-year period. For the nine months ended September 30, 2023, the Company reported net income of $45.3 million, or $2.14 per diluted share, compared to net income of $48.3 million, or $2.27 per diluted share, in the prior year period.

William B. (“Brad”) Kessel, the President and Chief Executive Officer of Independent Bank Corporation, commented: “Our team continued its positive momentum in the third quarter, achieving strong financial results with solid balance sheet growth, a stable net interest margin, disciplined expense management, and healthy asset quality. Capitalizing on the current operating environment, we gained new banking relationships with clients who appreciate our value proposition as a commercial bank with robust treasury management solutions, industry expertise, and client centric service. This success led to double-digit annualized growth in loans and deposits. Despite expecting lower loan growth in the fourth quarter due to seasonality, we have a solid pipeline of high-quality relationship opportunities.”

Significant items impacting comparable third quarter 2023 and 2022 results include the following:

• Changes in the fair value due to price of capitalized mortgage loan servicing rights (the “MSR Changes”) of $1.6 million ($0.06 per diluted share, after taxes) for the three-month period ended September 30, 2023, as compared to $3.2 million ($0.12 per diluted share, after taxes) for the three-months ended September 30, 2022.
• The provision for credit losses on loans was an expense of $1.4 million ($0.05 per diluted share, after taxes) in the third quarter ended September 30, 2023, as compared to an expense of $3.1 million ($0.12 per diluted share, after taxes) in the third quarter ended September 30, 2022.
  
  

Operating Results

The Company’s net interest income totaled $39.4 million during the third quarter of 2023, a decrease of $0.5 million, or 1.2% from the year-ago period, and an increase of $1.1 million, or 2.8%, from the second quarter of 2023. The Company’s tax equivalent net interest income as a percent of average interest-earning assets (the “net interest margin”) was 3.25% during the third quarter of 2023, compared to 3.49% in the year-ago period, and 3.26 in the second quarter of 2023. The year-over-year quarterly decrease in net interest income was due to a decrease in net interest margin that was partially offset by an increase in average interest-earning assets. The increase in net interest income compared to the linked quarter was due to an increase in average interest-earning assets that partially offset by a decrease in net interest margin. Average interest-earning assets were $4.89 billion in the third quarter of 2023, compared to $4.61 billion in the year ago quarter and $4.76 billion in the second quarter of 2023.

For the first nine months of 2023, net interest income totaled $116.2 million, an increase of $7.3 million, or 6.7% from the first nine months in 2022. The Company’s net interest margin for the first nine months of 2023 was 3.28% compared to 3.25% in 2022. The increase in net interest income for the first nine months of 2023 compared to 2022 reflects this improved margin as well as our increase in average interest- earning assets.

Non-interest income totaled $15.6 million and $41.6 million, respectively, for the third quarter and for the first nine months 2023, compared to $16.9 million and $50.4 million in the respective comparable prior year periods. These changes were primarily due to variances in mortgage banking related revenues.

Net gains on mortgage loans in the third quarters of 2023 and 2022, were approximately $2.1 million and $2.9 million, respectively. For the first nine months of 2023, net gains on mortgage loans totaled $5.5 million compared to $4.9 million in 2022. The comparative quarterly decrease in net gains on mortgage loans was primarily due to a decrease in the volume of mortgage loans sold that was partially offset by an increase in the gain on sale margin on mortgage loans sold.

Mortgage loan servicing, net, generated income of $2.7 million and $4.3 million in the third quarters of 2023 and 2022, respectively. For the first nine months of 2023 and 2022, mortgage loan servicing, net, generated income of $7.1 million and $18.1 million, respectively. The significant variance in mortgage loan servicing, net is primarily due to changes in the fair value of capitalized mortgage loan servicing rights associated with the magnitude of changes in mortgage loan interest rates and expected future prepayment levels between periods. Mortgage loan servicing, net activity is summarized in the following table:

	Three months ended								Nine months ended
	9/30/2023				9/30/2022				9/30/2023				9/30/2022
	(In thousands)
Mortgage loan servicing, net:
Revenue, net	$	2,197			$	2,190			$	6,612			$	6,397
Fair value change due to price		1,556				3,203				3,364				14,775
Fair value change due to pay-downs		(1,085	)			(1,110	)			(2,908	)			(3,086	)
Total	$	2,668			$	4,283			$	7,068			$	18,086

Non-interest expenses totaled $32.0 million in the third quarter of 2023, compared to $32.4 million in the year-ago period. For the first nine months of 2023, non-interest expenses totaled $95.2 million versus $96.3 million in 2022.

The Company recorded income tax expense of $4.1 million and $10.4 million in the third quarter and first nine months of 2023, respectively. This compares to an income tax expense of $4.0 million and $10.9 million in the third quarter and first nine months of 2022. The changes in income tax expense principally reflect changes in pre-tax earnings in 2023 relative to 2022.

Asset Quality

A breakdown of non-performing loans by loan type is as follows:

	9/30/2023					12/31/2022					9/30/2022
Loan Type	(Dollars in thousands)
Commercial	$	31				$	38				$	41
Mortgage		6,137					4,745					4,737
Installment		801					598					529
Sub total		6,969					5,381					5,307
Less - government guaranteed loans		2,254					1,660					1,491
Total non-performing loans	$	4,715				$	3,721				$	3,816
Ratio of non-performing loans to total portfolio loans		0.13		%			0.11		%			0.11		%
Ratio of non-performing assets to total assets		0.10		%			0.08		%			0.08		%
Ratio of allowance for credit losses to total non-performing loans		1176.99		%			1409.16		%			1340.20		%

The provision for credit losses on loans was an expense of $1.4 million and $3.1 million in the third quarters of 2023 and 2022, respectively. The provision for credit losses on loans was an expense of $3.8 million in both the first nine months of 2023 and 2022. The quarterly change in the provision for credit losses on loans in 2023 compared to 2022, is primarily the result of a decrease in pooled loan reserve loss rates on retail loans and a decline in loan growth. We recorded loan net charge offs (recoveries) of $(0.18) million and $(0.12) million in the third quarters of 2023 and 2022, respectively and $0.78 million and $(0.11) million during the first nine months of 2023 and 2022, respectively. At September 30, 2023, the allowance for credit losses for loans totaled $55.5 million, or 1.48% of total portfolio loans compared to $52.4 million, or 1.51% of total portfolio loans at December 31, 2022. The year-to-date increase in the provision for credit losses for securities HTM in 2023 compared to 2022, was the result of a loss incurred on a $3.0 million subordinated debt security that defaulted during the first quarter.

Balance Sheet, Capital and Liquidity

Total assets were $5.20 billion at September 30, 2023, an increase of $200.2 million from December 31, 2022. Loans, excluding loans held for sale, were $3.74 billion at September 30, 2023, compared to $3.47 billion at December 31, 2022.  Deposits totaled $4.59 billion at September 30, 2023, an increase of $206.5 million from December 31, 2022. This increase is primarily due to growth in reciprocal, time and brokered time deposit account balances that were partially offset by decreases in non-interest bearing and in savings and interest-bearing checking deposit account balances.

Cash and cash equivalents totaled $127.5 million at September 30, 2023, versus $74.4 million at December 31, 2022. Securities available for sale (“AFS”) totaled $684.6 million at September 30, 2023, versus $779.3 million at December 31, 2022.

Total shareholders’ equity was $375.0 million at September 30, 2023, or 7.21% of total assets compared to $347.6 million or 6.95% at December 31, 2022. Tangible common equity totaled $344.6 million at September 30, 2023, or $16.53 per share compared to $316.7 million or $15.04 per share at December 31, 2022. The increase in shareholder equity as well as tangible common equity are primarily the result of earnings retention.

The Company’s wholly owned subsidiary, Independent Bank, remains significantly above “well capitalized” for regulatory purposes with the following ratios:

Regulatory Capital Ratios	9/30/2023				12/31/2022				Well Capitalized Minimum
Tier 1 capital to average total assets	8.71		%		8.56		%		5.00		%
Tier 1 common equity to risk-weighted assets	11.09		%		10.97		%		6.50		%
Tier 1 capital to risk-weighted assets	11.09		%		10.97		%		8.00		%
Total capital to risk-weighted assets	12.34		%		12.22		%		10.00		%

At September 30, 2023, in addition to liquidity available from our normal operating, funding, and investing activities, we had unused credit lines with the FHLB and FRB of approximately $989.9 million and $504.0 million, respectively. We also had approximately $812.3 million in fair value of unpledged securities AFS and HTM at September 30, 2023 which could be pledged for an estimated additional borrowing capacity at the FHLB and FRB of approximately $749.4 million.

Share Repurchase Plan

On December 20, 2022, the Board of Directors of the Company authorized the 2023 share repurchase plan. Under the terms of the 2023 share repurchase plan, the Company is authorized to purchase up to 1,100,000 shares, or approximately 5% of its then outstanding common stock. The repurchase plan is authorized to last through December 31, 2023. For the first nine months of 2023, the Company repurchased 288,401 shares of common stock, for an aggregate purchase price of $5.0 million.

Earnings Conference Call

Brad Kessel, President and CEO, Gavin Mohr, CFO and Joel Rahn, EVP – Commercial Banking will review the quarterly results in a conference call for investors and analysts beginning at 11:00 am ET on Tuesday, October 24, 2023.

To participate in the live conference call, please dial 1-833-470-1428 (Access Code # 218288). Also, the conference call will be accessible through an audio webcast with user-controlled slides via the following site/URL: https://events.q4inc.com/attendee/796177293. 

A playback of the call can be accessed by dialing 1-866-813-9403 (Access Code # 103128). The replay will be available through October 31, 2023.

About Independent Bank Corporation

Independent Bank Corporation (NASDAQ: IBCP) is a Michigan-based bank holding company with total assets of approximately $5.2 billion. Founded as First National Bank of Ionia in 1864, Independent Bank Corporation operates a branch network across Michigan's Lower Peninsula through one state-chartered bank subsidiary. This subsidiary (Independent Bank) provides a full range of financial services, including commercial banking, mortgage lending, consumer banking, investments and insurance. Independent Bank Corporation is committed to providing exceptional personal service and value to its customers, stockholders and the communities it serves.

For more information, please visit our Web site at: IndependentBank.com.

Forward-Looking Statements
This presentation contains forward-looking statements, which are any statements or information that are not historical facts. These forward-looking statements include statements about our anticipated future revenue and expenses and our future plans and prospects.

Forward-looking statements involve inherent risks and uncertainties, and important factors could cause actual results to differ materially from those anticipated. For example, deterioration in general business and economic conditions or turbulence in domestic or global financial markets could adversely affect our revenues and the values of our assets and liabilities, reduce the availability of funding to us, lead to a tightening of credit, and increase stock price volatility. Our results could also be adversely affected by changes in interest rates; increases in unemployment rates; deterioration in the credit quality of our loan portfolios or in the value of the collateral securing those loans; deterioration in the value of our investment securities; legal and regulatory developments; changes in customer behavior and preferences; breaches in data security; and management’s ability to effectively manage the multitude of risks facing our business. Key risk factors that could affect our future results are described in more detail in our Annual Report on Form 10-K for the year ended December 31, 2022 and the other reports we file with the SEC, including under the heading “Risk Factors.” Investors should not place undue reliance on forward-looking statements as a prediction of our future results.

Any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise.

INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Consolidated Statements of Financial Condition
	September 30, 2023				December 31, 2022
	(Unaudited)
	(In thousands, except share amounts)
Assets
Cash and due from banks	$	58,567			$	70,180
Interest bearing deposits		68,894				4,191
Cash and Cash Equivalents		127,461				74,371
Securities available for sale		684,641				779,347
Securities held to maturity (fair value of $309,199 at September 30, 2023 and $335,418 at December 31, 2022)		358,899				374,818
Federal Home Loan Bank and Federal Reserve Bank stock, at cost		16,821				17,653
Loans held for sale, carried at fair value		13,979				26,518
Loans held for sale, carried at lower of cost or fair value		—				20,367
Loans
Commercial		1,626,122				1,466,853
Mortgage		1,475,908				1,368,409
Installment		639,456				630,090
Total Loans		3,741,486				3,465,352
Allowance for credit losses		(55,495	)			(52,435	)
Net Loans		3,685,991				3,412,917
Other real estate and repossessed assets, net		443				455
Property and equipment, net		35,346				35,893
Bank-owned life insurance		54,631				55,204
Capitalized mortgage loan servicing rights, carried at fair value		46,057				42,489
Other intangibles		2,141				2,551
Goodwill		28,300				28,300
Accrued income and other assets		145,308				128,904
Total Assets	$	5,200,018			$	4,999,787
Liabilities and Shareholders' Equity
Deposits
Non-interest bearing	$	1,141,641			$	1,269,759
Savings and interest-bearing checking		1,929,947				1,973,308
Reciprocal		799,883				602,575
Time		477,928				321,492
Brokered time		236,213				211,935
Total Deposits		4,585,612				4,379,069
Other borrowings		50,014				86,006
Subordinated debt		39,491				39,433
Subordinated debentures		39,711				39,660
Accrued expenses and other liabilities		110,192				108,023
Total Liabilities		4,825,020				4,652,191
Shareholders’ Equity
Preferred stock, no par value, 200,000 shares authorized; none issued or outstanding		—				—
Common stock, no par value, 500,000,000 shares authorized; issued and outstanding: 20,850,455 shares at September 30, 2023 and 21,063,971 shares at December 31, 2022		317,145				320,991
Retained earnings		150,157				119,368
Accumulated other comprehensive loss		(92,304	)			(92,763	)
Total Shareholders’ Equity		374,998				347,596
Total Liabilities and Shareholders’ Equity	$	5,200,018			$	4,999,787

INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Consolidated Statements of Operations
	Three Months Ended												Nine Months Ended
		September 30,				June 30,				September 30,			September 30,
		2023				2023				2022				2023				2022
	(Unaudited)
Interest Income	(In thousands, except per share amounts)
Interest and fees on loans	$	51,419			$	47,679			$	37,092			$	143,392			$	96,964
Interest on securities
Taxable		5,865				5,919				5,329				17,668				14,831
Tax-exempt		3,409				3,283				2,284				9,775				5,584
Other investments		1,739				1,067				220				3,481				651
Total Interest Income		62,432				57,948				44,925				174,316				118,030
Interest Expense
Deposits		20,743				17,461				3,625				51,964				5,608
Other borrowings and subordinated debt and debentures		2,262				2,137				1,403				6,134				3,463
Total Interest Expense		23,005				19,598				5,028				58,098				9,071
Net Interest Income		39,427				38,350				39,897				116,218				108,959
Provision for credit losses		1,350				3,317				3,145				6,827				3,951
Net Interest Income After Provision for Credit Losses		38,077				35,033				36,752				109,391				105,008
Non-interest Income
Interchange income		4,100				3,355				4,049				10,660				10,553
Service charges on deposit accounts		3,309				3,134				3,082				9,300				9,135
Net gains (losses) on assets
Mortgage loans		2,099				2,120				2,857				5,475				4,945
Securities available for sale		—				—				—				(222	)			(275	)
Mortgage loan servicing, net		2,668				3,674				4,283				7,068				18,086
Other		3,435				3,134				2,590				9,298				7,997
Total Non-interest Income		15,611				15,417				16,861				41,579				50,441
Non-interest Expense
Compensation and employee benefits		19,975				20,602				20,601				59,916				60,613
Data processing		3,071				2,891				2,653				8,953				7,513
Occupancy, net		1,971				1,845				2,062				5,975				6,682
Interchange expense		1,119				1,054				927				3,222				3,200
Furniture, fixtures and equipment		927				929				987				2,782				3,074
FDIC deposit insurance		677				749				591				2,209				1,570
Communications		568				635				723				1,871				2,242
Loan and collection		520				620				772				1,718				1,978
Legal and professional		543				473				573				1,623				1,545
Advertising		360				431				345				1,286				1,585
Costs (recoveries) related to unfunded lending commitments		451				100				382				76				676
Other		1,854				1,919				1,750				5,610				5,572
Total Non-interest Expense		32,036				32,248				32,366				95,241				96,250
Income Before Income Tax		21,652				18,202				21,247				55,729				59,199
Income tax expense		4,109				3,412				3,950				10,405				10,934
Net Income	$	17,543			$	14,790			$	17,297			$	45,324			$	48,265
Net Income Per Common Share
Basic	$	0.84			$	0.70			$	0.82			$	2.16			$	2.29
Diluted	$	0.83			$	0.70			$	0.81			$	2.14			$	2.27

INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Selected Financial Data
	September 30, 2023					June 30, 2023					March 31, 2023					December 31, 2022					September 30, 2022
	(unaudited)
	(Dollars in thousands except per share data)
Three Months Ended
Net interest income	$	39,427				$	38,350				$	38,441				$	40,602				$	39,897
Provision for credit losses		1,350					3,317					2,160					1,390					3,145
Non-interest income		15,611					15,417					10,551					11,468					16,861
Non-interest expense		32,036					32,248					30,957					32,091					32,366
Income before income tax		21,652					18,202					15,875					18,589					21,247
Income tax expense		4,109					3,412					2,884					3,503					3,950
Net income	$	17,543				$	14,790				$	12,991				$	15,086				$	17,297
Basic earnings per share	$	0.84				$	0.70				$	0.62				$	0.72				$	0.82
Diluted earnings per share		0.83					0.70					0.61					0.71					0.81
Cash dividend per share		0.23					0.23					0.23					0.22					0.22
Average shares outstanding		20,922,431					21,040,349					21,103,831					21,064,556					21,057,673
Average diluted shares outstanding		21,114,445					21,222,535					21,296,980					21,266,876					21,251,933
Performance Ratios
Return on average assets		1.34		%			1.18		%			1.06		%			1.21		%			1.40		%
Return on average equity		18.68					16.29					14.77					17.94					20.48
Efficiency ratio (1)		57.52					59.26					62.07					60.82					56.26
As a Percent of Average Interest-Earning Assets (1)
Interest income		5.12		%			4.91		%			4.67		%			4.41		%			3.92		%
Interest expense		1.87					1.65					1.34					0.89					0.43
Net interest income		3.25					3.26					3.33					3.52					3.49
Average Balances
Loans	$	3,694,534				$	3,567,920				$	3,494,169				$	3,449,944				$	3,360,621
Securities		1,071,211					1,111,670					1,146,075					1,164,809					1,226,203
Total earning assets		4,892,208					4,763,295					4,696,786					4,637,475					4,610,307
Total assets		5,192,114					5,044,746					4,988,440					4,934,859					4,884,841
Deposits		4,577,796					4,447,843					4,417,106					4,350,748					4,326,958
Interest bearing liabilities		3,554,179					3,415,621					3,304,868					3,159,374					3,075,210
Shareholders' equity		372,667					364,143					356,720					333,610					335,120

(1)   Presented on a fully tax equivalent basis assuming a marginal tax rate of 21%.

INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Selected Financial Data (continued)
	September 30, 2023					June 30, 2023					March 31, 2023					December 31, 2022					September 30, 2022
	(unaudited)
	(Dollars in thousands except per share data)
End of Period
Capital
Tangible common equity ratio		6.67		%			6.75		%			6.60		%			6.37		%			6.15		%
Tangible common equity ratio excluding accumulated other comprehensive loss		8.20					8.09					7.95					7.98					7.86
Average equity to average assets		7.18					7.22					7.15					6.76					6.86
Total capital to risk-weighted assets (2)		13.58					13.66					13.80					13.62					13.58
Tier 1 capital to risk-weighted assets (2)		11.36					11.42					11.53					11.36					11.29
Common equity tier 1 capital to risk-weighted assets (2)		10.44					10.46					10.55					10.38					10.29
Tier 1 capital to average assets (2)		8.93					8.97					8.92					8.86					8.77
Common shareholders' equity per share of common stock	$	17.99				$	17.91				$	17.40				$	16.50				$	15.78
Tangible common equity per share of common stock		16.53					16.45					15.94					15.04					14.30
Total shares outstanding		20,850,455					20,943,694					21,138,303					21,063,971					21,063,954
Selected Balances
Loans	$	3,741,486				$	3,631,114				$	3,509,809				$	3,465,352				$	3,409,858
Securities		1,043,540					1,092,703					1,137,103					1,154,165					1,183,701
Total earning assets		4,884,720					4,830,185					4,860,696					4,688,246					4,633,876
Total assets		5,200,018					5,135,564					5,138,934					4,999,787					4,931,377
Deposits		4,585,612					4,487,636					4,544,749					4,379,069					4,327,028
Interest bearing liabilities		3,573,187					3,501,280					3,481,511					3,274,409					3,116,027
Shareholders' equity		374,998					375,162					367,714					347,596					332,308

(2)   September 30, 2023 are Preliminary.

 

Reconciliation of Non-GAAP Financial Measures
Independent Bank Corporation

Independent Bank Corporation believes non-GAAP measures are meaningful because they reflect adjustments commonly made by management, investors, regulators and analysts to evaluate the adequacy of common equity and performance trends. Tangible common equity is used by the Company to measure the quality of capital.

Reconciliation of Non-GAAP Financial Measures

	Three Months Ended September 30,										Nine Months Ended September 30,
	2023					2022					2023					2022
	(Dollars in thousands)
Net Interest Margin, Fully Taxable Equivalent ("FTE")
Net interest income	$	39,427				$	39,897				$	116,218				$	108,959
Add:  taxable equivalent adjustment		422					462					1,284					1,425
Net interest income - taxable equivalent	$	39,849				$	40,359				$	117,502				$	110,384
Net interest margin (GAAP) (1)		3.21		%			3.45		%			3.25		%			3.21		%
Net interest margin (FTE) (1)		3.25		%			3.49		%			3.28		%			3.25		%

(1)   Annualized.

Tangible Common Equity Ratio

	September 30, 2023					June 30, 2023					March 31, 2023					December 31, 2022					September 30, 2022
	(Dollars in thousands)
Common shareholders' equity	$	374,998				$	375,162				$	367,714				$	347,596				$	332,308
Less:
Goodwill		28,300					28,300					28,300					28,300					28,300
Other intangibles		2,141					2,278					2,415					2,551					2,697
Tangible common equity		344,557					344,584					336,999					316,745					301,311
Addition:
Accumulated other comprehensive loss for regulatory purposes		86,507					74,712					75,013					86,966					91,248
Tangible common equity excluding other comprehensive loss adjustments	$	431,064				$	419,296				$	412,012				$	403,711				$	392,559
Total assets	$	5,200,018				$	5,135,564				$	5,138,934				$	4,999,787				$	4,931,377
Less:
Goodwill		28,300					28,300					28,300					28,300					28,300
Other intangibles		2,141					2,278					2,415					2,551					2,697
Tangible assets		5,169,577					5,104,986					5,108,219					4,968,936					4,900,380
Addition:
Net unrealized losses on available for sale securities and derivatives, net of tax		86,507					74,712					75,013					86,966					91,248
Tangible assets excluding other comprehensive loss adjustments	$	5,256,084				$	5,179,698				$	5,183,232				$	5,055,902				$	4,991,628
Common equity ratio		7.21		%			7.31		%			7.16		%			6.95		%			6.74		%
Tangible common equity ratio		6.67		%			6.75		%			6.60		%			6.37		%			6.15		%
Tangible common equity ratio excluding other comprehensive loss		8.20		%			8.09		%			7.95		%			7.98		%			7.86		%
Tangible Common Equity per Share of Common Stock:
Common shareholders' equity	$	374,998				$	375,162				$	367,714				$	347,596				$	332,308
Tangible common equity	$	344,557				$	344,584				$	336,999				$	316,745				$	301,311
Shares of common stock outstanding (in thousands)		20,850					20,944					21,138					21,064					21,064
Common shareholders' equity per share of common stock	$	17.99				$	17.91				$	17.40				$	16.50				$	15.78
Tangible common equity per share of common stock	$	16.53				$	16.45				$	15.94				$	15.04				$	14.30

The tangible common equity ratio removes the effect of goodwill and other intangible assets from capital and total assets.  Tangible common equity per share of common stock removes the effect of goodwill and other intangible assets from common shareholders’ equity per share of common stock.

Contact:

William B. Kessel, President and CEO, 616.447.3933 Gavin A. Mohr, Chief Financial Officer, 616.447.3929

FAQ

What was the net income for Q3 2023?

The net income for Q3 2023 was $17.5 million.

What was the increase in net interest income compared to Q2 2023?

The increase in net interest income compared to Q2 2023 was $1.1 million (2.8%).

Was there growth in core deposits and loans?

Yes, there was net growth in core deposits of $112.6 million (10.5% annualized) and net growth in loans of $110.4 million (12.1% annualized).

Was there a dividend payment on common stock?

Yes, a dividend of 23 cents per share was paid on common stock.

What were the highlights mentioned by the President and CEO?

The highlights mentioned were solid balance sheet growth, stable net interest margin, disciplined expense management, and healthy asset quality. They also mentioned double-digit annualized growth in loans and deposits.

Why did non-interest income decrease?

Non-interest income decreased due to variances in mortgage banking revenues.