Mercantile Bank Corporation Announces Strong Second Quarter 2022 Results
Mercantile Bank Corporation (NASDAQ: MBWM) reported a net income of $11.7 million for Q2 2022, down from $18.1 million in Q2 2021. For the first half of 2022, net income totaled $23.2 million, decreasing from $32.3 million in 2021.
Key highlights include 10% core commercial loan growth, increased net interest income of $34.3 million, and a net interest margin rise to 2.88%. Noninterest income fell significantly to $7.7 million due to lower mortgage banking income. Total assets were $5.06 billion, with loans increasing by $270 million. The company maintains strong asset quality metrics.
- 10% annualized growth in core commercial loans.
- Increased net interest income by 11.2% to $34.3 million.
- Net interest margin improved to 2.88%.
- Strong asset quality metrics with low nonperforming assets.
- Net income decreased to $11.7 million from $18.1 million YoY.
- Noninterest income dropped to $7.7 million, down from $14.6 million YoY due to decreased mortgage banking income.
- Total deposits fell by 5.1% to $3.87 billion.
Robust loan growth, continuing strength in asset quality metrics, and significant increases in several key fee income categories highlight quarter
GRAND RAPIDS, Mich., July 19, 2022 /PRNewswire/ -- Mercantile Bank Corporation (NASDAQ: MBWM) ("Mercantile") reported net income of
"We are pleased to report another quarter of solid operating performance," said Robert B. Kaminski, Jr., President and Chief Executive Officer of Mercantile. "The substantial growth in core commercial loans and residential mortgage loans and sustained strength in asset quality metrics during the first six months of 2022 exhibit our ongoing focus on meeting the credit needs of our customers while employing sound underwriting practices. The increase in net interest income stemming from earning asset growth and a higher net interest margin, growth in several key fee income revenue streams, and overhead cost control have largely offset a substantially lower level of mortgage banking income primarily resulting from increased mortgage loan interest rates. The entire Mercantile team has adeptly pivoted from assisting clients with initial COVID-19 pandemic-related issues to helping them navigate through the latest economic challenges such as high inflation levels, rising interest rates, and staffing concerns, and we believe our commitment to serving as a trusted advisor will present us with additional opportunities to develop mutually beneficial relationships with new and existing customers."
Second quarter highlights include:
- Annualized net core commercial loan growth of approximately 10 percent
- Significant increase in residential mortgage loan portfolio
- Continued strength in commercial loan pipeline
- Net interest income expansion reflecting loan growth and improved net interest margin
- Substantial increases in several key fee income categories
- Sustained low levels of nonperforming assets and loan charge-offs
- Solid capital position
Operating Results
Total revenue, which consists of net interest income and noninterest income, was
The net interest margin was 2.88 percent in the second quarter of 2022, up from 2.57 percent in the first quarter of 2022 and 2.76 percent in the prior-year second quarter. The yield on average earning assets was 3.32 percent during the current-year second quarter, up from 2.99 percent during the first quarter of 2022 and 3.20 percent during the second quarter of 2021. The increased yield on average earning assets primarily resulted from a higher yield on other interest-earning assets, reflecting the rising interest rate environment, and a change in earning asset mix, comprised of a decrease in lower-yielding interest-earning deposits and an increase in higher-yielding loans as a percentage of earning assets. An increase in the yield on loans from 3.87 percent during the first quarter of 2022 to 3.97 percent during the current-year second quarter, mainly reflecting higher rates on variable-rate commercial loans resulting from the Federal Open Market Committee ("FOMC") significantly raising the targeted federal funds rate by a total of 150 basis points during the period of March 2022 through June 2022, also significantly contributed to the increased yield on average earning assets during the respective periods. The yield on average loans during the second quarter of 2022 was virtually unchanged from the yield during the second quarter of 2021 as the negative impact of a lower level of Paycheck Protection Program net loan fee accretion was substantially offset by the positive impact of the aforementioned higher rates on variable-rate commercial loans stemming from the FOMC rate hikes. As of June 30, 2022, approximately 63 percent of the commercial loan portfolio consisted of variable-rate loans, with substantially all of the loans subject to immediate repricing in response to likely further FOMC rate hikes.
The cost of funds equaled 0.44 percent in the second quarter of 2022, unchanged from the prior-year second quarter as an increased cost of borrowings, primarily reflecting the issuance of
A significant volume of excess on-balance sheet liquidity, which initially surfaced in the second quarter of 2020 as a result of the COVID-19 environment and has persisted since that time, negatively impacted the yield on average earning assets by 28 basis points and 42 basis points during the second quarters of 2022 and 2021, respectively, and the net interest margin by 23 basis points and 37 basis points during the respective periods. The excess funds, consisting almost entirely of low-yielding deposits with the Federal Reserve Bank of Chicago, are mainly a product of local deposit growth and Paycheck Protection Program loan forgiveness activities.
Mercantile recorded a provision for credit losses of
Noninterest income during the second quarter of 2022 was
Noninterest expense totaled
Mr. Kaminski commented, "We are very pleased with the net interest income expansion during the second quarter and first six months of 2022, and we believe our balance sheet is structured to enhance our net interest margin if the FOMC continues to raise the targeted federal funds rate in an effort to curb inflation, which appears likely based on recent Federal Reserve communications and interest rate forecasts. The increase in net interest income, along with growth in several key fee income categories, have significantly offset a notable decline in mortgage banking income stemming from changed market conditions. We remain committed to controlling overhead costs and are constantly reviewing and monitoring our operating expenses, including our branch structure, to identify additional opportunities to improve efficiency."
Balance Sheet
As of June 30, 2022, total assets were
Ray Reitsma, President of Mercantile Bank, noted, "We are very pleased with the robust levels of core commercial loan and residential mortgage loan growth during the second quarter and first six months of 2022. Core commercial and industrial loan growth accounted for more than one-half of the increase in core commercial loans during both periods, providing our lenders and treasury management personnel with further opportunities to augment commercial banking-related revenue streams. The increases in core commercial loans during the current-year second quarter and first half of 2022 were attained despite payoffs of certain larger relationships totaling approximately
Commercial and industrial loans and owner-occupied commercial real estate loans together represented approximately 58 percent of total commercial loans as of June 30, 2022, a level that has remained relatively consistent with prior periods and in line with internal expectations.
Total deposits at June 30, 2022, were
Asset Quality
Nonperforming assets totaled
Mr. Reitsma commented, "Our sustained commitment to underwriting loans in an appropriate and cautious manner is reflected in our ongoing outstanding asset quality metrics. We continue to carefully monitor our loan portfolio for any signs of distress stemming from the current economic environment and associated challenges, including high levels of inflation, supply chain disruptions, and tight labor market conditions, and are prepared to take swift action to mitigate the impact of any noted credit issues on our portfolio's condition."
Capital Position
Shareholders' equity totaled
Mr. Kaminski concluded, "As evidenced by our Board of Directors' declaration of an increased third quarter 2022 regular cash dividend, our ongoing financial strength has enabled us to reward shareholders with competitive dividend yields while supporting strong loan growth. We believe our robust overall financial condition, including solid capital levels, pristine asset quality metrics, strong operating performance, and significant loan funding opportunities, along with the potential to enhance net interest income from likely additional FOMC rate increases, will help mitigate the potential negative impacts from a downturn in economic conditions. Our solid financial performance during the first six months of 2022 and projected loan growth give us confidence that strong operating results can be achieved during the remainder of the year and beyond as we continue our efforts to be a consistent and profitable performer."
Investor Presentation
Mercantile has prepared presentation materials that management intends to use during its previously announced second quarter 2022 conference call on Tuesday, July 19, 2022, at 10:00 a.m. Eastern Time, and from time to time thereafter in presentations about the Company's operations and performance. These materials have been furnished to the U.S. Securities and Exchange Commission concurrently with this press release, and are also available on Mercantile's website at www.mercbank.com.
About Mercantile Bank Corporation
Based in Grand Rapids, Michigan, Mercantile Bank Corporation is the bank holding company for Mercantile Bank. Mercantile provides banking services to businesses, individuals and governmental units, and differentiates itself on the basis of service quality and the expertise of its banking staff. Mercantile has assets of approximately
Forward-Looking Statements
This news release contains statements or information that may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: "anticipate," "intend," "plan," "goal," "seek," "believe," "project," "estimate," "expect," "strategy," "future," "likely," "may," "should," "will," and similar references to future periods. Any such statements are based on current expectations that involve a number of risks and uncertainties. Actual results may differ materially from the results expressed in forward-looking statements. Factors that might cause such a difference include changes in interest rates and interest rate relationships; increasing rates of inflation and slower growth rates; significant declines in the value of commercial real estate; market volatility; demand for products and services; the degree of competition by traditional and nontraditional financial services companies; changes in banking regulation or actions by bank regulators; changes in tax laws; changes in prices, levies, and assessments; the impact of technological advances; potential cyber-attacks, information security breaches and other criminal activities; litigation liabilities; governmental and regulatory policy changes; the outcomes of existing or future contingencies; trends in customer behavior as well as their ability to repay loans; changes in local real estate values; damage to our reputation resulting from adverse publicity, regulatory actions, litigation, operational failures, and the failure to meet client expectations and other facts; changes in the method of determining Libor and the phase-out of Libor; changes in the national and local economies, including the ongoing disruption to financial markets and other economic activity caused by the COVID-19 pandemic and unstable political and economic environments; and other factors, including those expressed as risk factors, disclosed from time to time in filings made by Mercantile with the Securities and Exchange Commission. Mercantile undertakes no obligation to update or clarify forward-looking statements, whether as a result of new information, future events or otherwise. Investors are cautioned not to place undue reliance on any forward-looking statements contained herein.
MBWM-ER
FOR FURTHER INFORMATION: | |
Robert B. Kaminski, Jr. | Charles Christmas |
President and CEO | Executive Vice President and CFO |
616-726-1502 | 616-726-1202 |
Mercantile Bank Corporation | ||||||
Second Quarter 2022 Results | ||||||
MERCANTILE BANK CORPORATION | ||||||
CONSOLIDATED BALANCE SHEETS | ||||||
(Unaudited) | ||||||
JUNE 30, | DECEMBER 31, | JUNE 30, | ||||
2022 | 2021 | 2021 | ||||
ASSETS | ||||||
Cash and due from banks | $ | 89,167,000 | $ | 59,405,000 | $ | 75,893,000 |
Interest-earning deposits | 389,938,000 | 915,755,000 | 683,638,000 | |||
Total cash and cash equivalents | 479,105,000 | 975,160,000 | 759,531,000 | |||
Securities available for sale | 603,638,000 | 592,743,000 | 506,125,000 | |||
Federal Home Loan Bank stock | 17,721,000 | 18,002,000 | 18,002,000 | |||
Mortgage loans held for sale | 12,964,000 | 16,117,000 | 27,720,000 | |||
Loans | 3,723,800,000 | 3,453,459,000 | 3,248,841,000 | |||
Allowance for credit losses | (35,974,000) | (35,363,000) | (35,913,000) | |||
Loans, net | 3,687,826,000 | 3,418,096,000 | 3,212,928,000 | |||
Premises and equipment, net | 51,402,000 | 57,298,000 | 58,250,000 | |||
Bank owned life insurance | 75,664,000 | 75,242,000 | 72,679,000 | |||
Goodwill | 49,473,000 | 49,473,000 | 49,473,000 | |||
Core deposit intangible, net | 900,000 | 1,351,000 | 1,827,000 | |||
Other assets | 79,862,000 | 54,267,000 | 50,879,000 | |||
Total assets | $ | 5,058,555,000 | $ | 5,257,749,000 | $ | 4,757,414,000 |
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||
Deposits: | ||||||
Noninterest-bearing | $ | 1,740,432,000 | $ | 1,677,952,000 | $ | 1,620,829,000 |
Interest-bearing | 2,133,461,000 | 2,405,241,000 | 2,050,442,000 | |||
Total deposits | 3,873,893,000 | 4,083,193,000 | 3,671,271,000 | |||
Securities sold under agreements to repurchase | 203,339,000 | 197,463,000 | 169,737,000 | |||
Federal Home Loan Bank advances | 362,263,000 | 374,000,000 | 394,000,000 | |||
Subordinated debentures | 48,585,000 | 48,244,000 | 47,904,000 | |||
Subordinated notes | 88,457,000 | 73,646,000 | 0 | |||
Accrued interest and other liabilities | 53,035,000 | 24,644,000 | 22,614,000 | |||
Total liabilities | 4,629,572,000 | 4,801,190,000 | 4,305,526,000 | |||
SHAREHOLDERS' EQUITY | ||||||
Common stock | 288,199,000 | 285,752,000 | 293,232,000 | |||
Retained earnings | 188,452,000 | 174,536,000 | 157,150,000 | |||
Accumulated other comprehensive income/(loss) | (47,668,000) | (3,729,000) | 1,506,000 | |||
Total shareholders' equity | 428,983,000 | 456,559,000 | 451,888,000 | |||
Total liabilities and shareholders' equity | $ | 5,058,555,000 | $ | 5,257,749,000 | $ | 4,757,414,000 |
Mercantile Bank Corporation | |||||||||||||
Second Quarter 2022 Results | |||||||||||||
MERCANTILE BANK CORPORATION | |||||||||||||
CONSOLIDATED REPORTS OF INCOME | |||||||||||||
(Unaudited) | |||||||||||||
THREE MONTHS ENDED | THREE MONTHS ENDED | SIX MONTHS ENDED | SIX MONTHS ENDED | ||||||||||
June 30, 2022 | June 30, 2021 | June 30, 2022 | June 30, 2021 | ||||||||||
INTEREST INCOME | |||||||||||||
Loans, including fees | $ | 36,003,000 | $ | 33,789,000 | $ | 69,254,000 | $ | 66,774,000 | |||||
Investment securities | 2,529,000 | 1,802,000 | 4,794,000 | 3,434,000 | |||||||||
Other interest-earning assets | 1,018,000 | 183,000 | 1,384,000 | 351,000 | |||||||||
Total interest income | 39,550,000 | 35,774,000 | 75,432,000 | 70,559,000 | |||||||||
INTEREST EXPENSE | |||||||||||||
Deposits | 1,873,000 | 2,346,000 | 3,698,000 | 5,063,000 | |||||||||
Short-term borrowings | 49,000 | 40,000 | 99,000 | 76,000 | |||||||||
Federal Home Loan Bank advances | 1,911,000 | 2,050,000 | 3,774,000 | 4,077,000 | |||||||||
Other borrowed money | 1,391,000 | 467,000 | 2,650,000 | 939,000 | |||||||||
Total interest expense | 5,224,000 | 4,903,000 | 10,221,000 | 10,155,000 | |||||||||
Net interest income | 34,326,000 | 30,871,000 | 65,211,000 | 60,404,000 | |||||||||
Provision for credit losses | 500,000 | (3,100,000) | 600,000 | (2,800,000) | |||||||||
Net interest income after | |||||||||||||
provision for credit losses | 33,826,000 | 33,971,000 | 64,611,000 | 63,204,000 | |||||||||
NONINTEREST INCOME | |||||||||||||
Service charges on accounts | 1,495,000 | 1,209,000 | 2,910,000 | 2,363,000 | |||||||||
Credit and debit card income | 2,134,000 | 1,920,000 | 4,015,000 | 3,598,000 | |||||||||
Mortgage banking income | 1,947,000 | 7,695,000 | 5,228,000 | 16,495,000 | |||||||||
Interest rate swap income | 430,000 | 1,495,000 | 1,781,000 | 2,148,000 | |||||||||
Payroll services | 464,000 | 405,000 | 1,102,000 | 962,000 | |||||||||
Earnings on bank owned life insurance | 785,000 | 297,000 | 1,072,000 | 574,000 | |||||||||
Gain on sale of branch | 0 | 1,058,000 | 0 | 1,058,000 | |||||||||
Other income | 486,000 | 477,000 | 910,000 | 821,000 | |||||||||
Total noninterest income | 7,741,000 | 14,556,000 | 17,018,000 | 28,019,000 | |||||||||
NONINTEREST EXPENSE | |||||||||||||
Salaries and benefits | 15,676,000 | 16,194,000 | 31,186,000 | 31,279,000 | |||||||||
Occupancy | 2,064,000 | 1,977,000 | 4,168,000 | 3,991,000 | |||||||||
Furniture and equipment | 935,000 | 902,000 | 1,869,000 | 1,791,000 | |||||||||
Data processing costs | 3,091,000 | 2,775,000 | 6,064,000 | 5,392,000 | |||||||||
Charitable foundation contribution | 506,000 | 0 | 506,000 | 0 | |||||||||
Other expense | 4,670,000 | 4,344,000 | 8,891,000 | 8,856,000 | |||||||||
Total noninterest expense | 26,942,000 | 26,192,000 | 52,684,000 | 51,309,000 | |||||||||
Income before federal income | |||||||||||||
tax expense | 14,625,000 | 22,335,000 | 28,945,000 | 39,914,000 | |||||||||
Federal income tax expense | 2,888,000 | 4,244,000 | 5,716,000 | 7,583,000 | |||||||||
Net Income | $ | 11,737,000 | $ | 18,091,000 | $ | 23,229,000 | $ | 32,331,000 | |||||
Basic earnings per share | |||||||||||||
Diluted earnings per share | |||||||||||||
Average basic shares outstanding | 15,848,681 | 16,116,070 | 15,844,763 | 16,199,096 | |||||||||
Average diluted shares outstanding | 15,848,681 | 16,116,666 | 15,844,790 | 16,199,620 | |||||||||
Mercantile Bank Corporation | ||||||||||||||
Second Quarter 2022 Results | ||||||||||||||
MERCANTILE BANK CORPORATION | ||||||||||||||
CONSOLIDATED FINANCIAL HIGHLIGHTS | ||||||||||||||
(Unaudited) | ||||||||||||||
Quarterly | Year-To-Date | |||||||||||||
(dollars in thousands except per share data) | 2022 | 2022 | 2021 | 2021 | 2021 | |||||||||
2nd Qtr | 1st Qtr | 4th Qtr | 3rd Qtr | 2nd Qtr | 2022 | 2021 | ||||||||
EARNINGS | ||||||||||||||
Net interest income | $ | 34,326 | 30,885 | 32,534 | 31,124 | 30,871 | 65,211 | 60,404 | ||||||
Provision for credit losses | $ | 500 | 100 | (3,400) | 1,900 | (3,100) | 600 | (2,800) | ||||||
Noninterest income | $ | 7,741 | 9,277 | 12,632 | 15,568 | 14,556 | 17,018 | 28,019 | ||||||
Noninterest expense | $ | 26,942 | 25,742 | 33,347 | 26,210 | 26,192 | 52,684 | 51,309 | ||||||
Net income before federal income | ||||||||||||||
tax expense | $ | 14,625 | 14,320 | 15,219 | 18,582 | 22,335 | 28,945 | 39,914 | ||||||
Net income | $ | 11,737 | 11,492 | 11,639 | 15,051 | 18,091 | 23,229 | 32,331 | ||||||
Basic earnings per share | $ | 0.74 | 0.73 | 0.74 | 0.95 | 1.12 | 1.47 | 2.00 | ||||||
Diluted earnings per share | $ | 0.74 | 0.73 | 0.74 | 0.95 | 1.12 | 1.47 | 2.00 | ||||||
Average basic shares outstanding | 15,848,681 | 15,840,801 | 15,696,204 | 15,859,955 | 16,116,070 | 15,844,763 | 16,199,096 | |||||||
Average diluted shares outstanding | 15,848,681 | 15,841,037 | 15,696,451 | 15,860,314 | 16,116,666 | 15,844,790 | 16,199,620 | |||||||
PERFORMANCE RATIOS | ||||||||||||||
Return on average assets | 0.93 % | 0.90 % | 0.92 % | 1.23 % | 1.53 % | 0.91 % | 1.40 % | |||||||
Return on average equity | 10.98 % | 10.36 % | 10.15 % | 13.10 % | 16.27 % | 10.66 % | 14.66 % | |||||||
Net interest margin (fully tax-equivalent) | 2.88 % | 2.57 % | 2.74 % | 2.71 % | 2.76 % | 2.73 % | 2.76 % | |||||||
Efficiency ratio | 64.05 % | 64.10 % | 73.83 % | 56.13 % | 57.66 % | 64.07 % | 58.03 % | |||||||
Full-time equivalent employees | 651 | 630 | 627 | 629 | 634 | 651 | 634 | |||||||
YIELD ON ASSETS / COST OF FUNDS | ||||||||||||||
Yield on loans | 3.97 % | 3.87 % | 4.07 % | 4.07 % | 3.99 % | 3.92 % | 4.01 % | |||||||
Yield on securities | 1.68 % | 1.52 % | 1.46 % | 1.46 % | 1.54 % | 1.60 % | 1.57 % | |||||||
Yield on other interest-earning assets | 0.76 % | 0.19 % | 0.15 % | 0.16 % | 0.12 % | 0.42 % | 0.12 % | |||||||
Yield on total earning assets | 3.32 % | 2.99 % | 3.12 % | 3.13 % | 3.20 % | 3.16 % | 3.23 % | |||||||
Yield on total assets | 3.13 % | 2.82 % | 2.94 % | 2.94 % | 3.02 % | 2.97 % | 3.05 % | |||||||
Cost of deposits | 0.19 % | 0.19 % | 0.19 % | 0.23 % | 0.25 % | 0.19 % | 0.28 % | |||||||
Cost of borrowed funds | 1.90 % | 1.82 % | 1.66 % | 1.67 % | 1.73 % | 1.86 % | 1.75 % | |||||||
Cost of interest-bearing liabilities | 0.72 % | 0.66 % | 0.63 % | 0.69 % | 0.74 % | 0.69 % | 0.78 % | |||||||
Cost of funds (total earning assets) | 0.44 % | 0.42 % | 0.38 % | 0.42 % | 0.44 % | 0.43 % | 0.47 % | |||||||
Cost of funds (total assets) | 0.41 % | 0.39 % | 0.36 % | 0.39 % | 0.41 % | 0.40 % | 0.44 % | |||||||
MORTGAGE BANKING ACTIVITY | ||||||||||||||
Total mortgage loans originated | $ | 190,896 | 168,187 | 210,228 | 259,512 | 237,299 | 359,083 | 482,499 | ||||||
Purchase mortgage loans originated | $ | 157,423 | 101,409 | 124,557 | 143,635 | 144,476 | 258,832 | 226,005 | ||||||
Refinance mortgage loans originated | $ | 33,473 | 66,778 | 85,671 | 115,877 | 92,823 | 100,251 | 256,494 | ||||||
Total saleable mortgage loans | $ | 52,328 | 75,747 | 129,546 | 177,837 | 140,497 | 128,075 | 336,152 | ||||||
Income on sale of mortgage loans | $ | 1,751 | 3,204 | 6,850 | 6,659 | 7,690 | 4,955 | 16,872 | ||||||
CAPITAL | ||||||||||||||
Tangible equity to tangible assets | 7.56 % | 7.53 % | 7.79 % | 8.17 % | 8.51 % | 7.56 % | 8.51 % | |||||||
Tier 1 leverage capital ratio | 9.31 % | 9.04 % | 9.19 % | 9.33 % | 9.47 % | 9.31 % | 9.47 % | |||||||
Common equity risk-based capital ratio | 9.84 % | 10.02 % | 10.12 % | 10.34 % | 10.87 % | 9.84 % | 10.87 % | |||||||
Tier 1 risk-based capital ratio | 10.91 % | 11.13 % | 11.26 % | 11.53 % | 12.11 % | 10.91 % | 12.11 % | |||||||
Total risk-based capital ratio | 13.78 % | 14.09 % | 13.95 % | 12.47 % | 13.09 % | 13.78 % | 13.09 % | |||||||
Tier 1 capital | $ | 473,065 | 464,396 | 456,133 | 448,010 | 445,410 | 473,065 | 445,410 | ||||||
Tier 1 plus tier 2 capital | $ | 597,495 | 587,976 | 565,143 | 484,594 | 481,324 | 597,495 | 481,324 | ||||||
Total risk-weighted assets | $ | 4,335,846 | 4,173,590 | 4,051,253 | 3,884,999 | 3,677,180 | 4,335,846 | 3,677,180 | ||||||
Book value per common share | $ | 27.05 | 27.55 | 28.82 | 28.78 | 28.23 | 27.05 | 28.23 | ||||||
Tangible book value per common share | $ | 23.87 | 24.36 | 25.61 | 25.53 | 25.03 | 23.87 | 25.03 | ||||||
Cash dividend per common share | $ | 0.31 | 0.31 | 0.30 | 0.30 | 0.29 | 0.62 | 0.58 | ||||||
ASSET QUALITY | ||||||||||||||
Gross loan charge-offs | $ | 15 | 205 | 179 | 744 | 68 | 220 | 121 | ||||||
Recoveries | $ | 336 | 294 | 1,519 | 354 | 386 | 630 | 867 | ||||||
Net loan charge-offs (recoveries) | $ | (321) | (89) | (1,340) | 390 | (318) | (410) | (746) | ||||||
Net loan charge-offs to average loans | (0.04 %) | (0.01 %) | (0.16 %) | 0.05 % | (0.04 %) | (0.02 %) | (0.05 %) | |||||||
Allowance for credit losses | $ | 35,974 | 35,153 | 35,363 | 37,423 | 35,913 | 35,974 | 35,913 | ||||||
Allowance to loans | 0.97 % | 0.99 % | 1.02 % | 1.13 % | 1.11 % | 0.97 % | 1.11 % | |||||||
Allowance to loans excluding PPP loans | 0.97 % | 0.99 % | 1.04 % | 1.17 % | 1.20 % | 0.97 % | 1.20 % | |||||||
Nonperforming loans | $ | 1,787 | 1,612 | 2,468 | 2,766 | 2,746 | 1,787 | 2,746 | ||||||
Other real estate/repossessed assets | $ | 0 | 0 | 0 | 111 | 404 | 0 | 404 | ||||||
Nonperforming loans to total loans | 0.05 % | 0.05 % | 0.07 % | 0.08 % | 0.08 % | 0.05 % | 0.08 % | |||||||
Nonperforming assets to total assets | 0.04 % | 0.03 % | 0.05 % | 0.06 % | 0.07 % | 0.04 % | 0.07 % | |||||||
NONPERFORMING ASSETS - COMPOSITION | ||||||||||||||
Residential real estate: | ||||||||||||||
Land development | $ | 30 | 31 | 32 | 33 | 34 | 30 | 34 | ||||||
Construction | $ | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||
Owner occupied / rental | $ | 1,508 | 1,579 | 1,768 | 2,063 | 2,137 | 1,508 | 2,137 | ||||||
Commercial real estate: | ||||||||||||||
Land development | $ | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||
Construction | $ | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||
Owner occupied | $ | 0 | 0 | 0 | 100 | 363 | 0 | 363 | ||||||
Non-owner occupied | $ | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||
Non-real estate: | ||||||||||||||
Commercial assets | $ | 248 | 0 | 662 | 673 | 606 | 248 | 606 | ||||||
Consumer assets | $ | 1 | 2 | 6 | 8 | 10 | 1 | 10 | ||||||
Total nonperforming assets | 1,787 | 1,612 | 2,468 | 2,877 | 3,150 | 1,787 | 3,150 | |||||||
NONPERFORMING ASSETS - RECON | ||||||||||||||
Beginning balance | $ | 1,612 | 2,468 | 2,877 | 3,150 | 3,167 | 2,468 | 4,085 | ||||||
Additions | $ | 309 | 93 | 218 | 361 | 522 | 402 | 638 | ||||||
Return to performing status | $ | 0 | (213) | 0 | (50) | 0 | (213) | (115) | ||||||
Principal payments | $ | (134) | (641) | (377) | (291) | (484) | (775) | (1,043) | ||||||
Sale proceeds | $ | 0 | 0 | (111) | (209) | 0 | 0 | (77) | ||||||
Loan charge-offs | $ | 0 | (95) | (139) | 0 | (55) | (95) | (88) | ||||||
Valuation write-downs | $ | 0 | 0 | 0 | (84) | 0 | 0 | (250) | ||||||
Ending balance | $ | 1,787 | 1,612 | 2,468 | 2,877 | 3,150 | 1,787 | 3,150 | ||||||
LOAN PORTFOLIO COMPOSITION | ||||||||||||||
Commercial: | ||||||||||||||
Commercial & industrial | $ | 1,187,650 | 1,153,814 | 1,137,419 | 1,074,394 | 1,103,807 | 1,187,650 | 1,103,807 | ||||||
Land development & construction | $ | 57,808 | 52,693 | 43,240 | 38,380 | 43,111 | 57,808 | 43,111 | ||||||
Owner occupied comm'l R/E | $ | 598,593 | 582,732 | 565,758 | 551,762 | 550,504 | 598,593 | 550,504 | ||||||
Non-owner occupied comm'l R/E | $ | 1,003,118 | 1,007,361 | 1,027,415 | 998,697 | 950,993 | 1,003,118 | 950,993 | ||||||
Multi-family & residential rental | $ | 224,591 | 207,962 | 176,593 | 179,126 | 161,894 | 224,591 | 161,894 | ||||||
Total commercial | $ | 3,071,760 | 3,004,562 | 2,950,425 | 2,842,359 | 2,810,309 | 3,071,760 | 2,810,309 | ||||||
Retail: | ||||||||||||||
1-4 family mortgages | $ | 623,599 | 522,556 | 442,546 | 411,618 | 380,292 | 623,599 | 380,292 | ||||||
Other consumer | $ | 28,441 | 28,672 | 60,488 | 59,732 | 58,240 | 28,441 | 58,240 | ||||||
Total retail | $ | 652,040 | 551,228 | 503,034 | 471,350 | 438,532 | 652,040 | 438,532 | ||||||
Total loans | $ | 3,723,800 | 3,555,790 | 3,453,459 | 3,313,709 | 3,248,841 | 3,723,800 | 3,248,841 | ||||||
END OF PERIOD BALANCES | ||||||||||||||
Loans | $ | 3,723,800 | 3,555,790 | 3,453,459 | 3,313,709 | 3,248,841 | 3,723,800 | 3,248,841 | ||||||
Securities | $ | 621,359 | 623,382 | 610,745 | 577,566 | 524,127 | 621,359 | 524,127 | ||||||
Other interest-earning assets | $ | 389,938 | 698,724 | 915,755 | 741,557 | 683,638 | 389,938 | 683,638 | ||||||
Total earning assets (before allowance) | $ | 4,735,097 | 4,877,896 | 4,979,959 | 4,632,832 | 4,456,606 | 4,735,097 | 4,456,606 | ||||||
Total assets | $ | 5,058,555 | 5,175,899 | 5,257,749 | 4,964,412 | 4,757,414 | 5,058,555 | 4,757,414 | ||||||
Noninterest-bearing deposits | $ | 1,740,432 | 1,686,203 | 1,677,952 | 1,647,380 | 1,620,829 | 1,740,432 | 1,620,829 | ||||||
Interest-bearing deposits | $ | 2,133,461 | 2,290,048 | 2,405,241 | 2,221,611 | 2,050,442 | 2,133,461 | 2,050,442 | ||||||
Total deposits | $ | 3,873,893 | 3,976,251 | 4,083,193 | 3,868,991 | 3,671,271 | 3,873,893 | 3,671,271 | ||||||
Total borrowed funds | $ | 703,809 | 724,578 | 694,588 | 619,441 | 613,205 | 703,809 | 613,205 | ||||||
Total interest-bearing liabilities | $ | 2,837,270 | 3,014,626 | 3,099,829 | 2,841,052 | 2,663,647 | 2,837,270 | 2,663,647 | ||||||
Shareholders' equity | $ | 428,983 | 436,471 | 456,559 | 452,278 | 451,888 | 428,983 | 451,888 | ||||||
AVERAGE BALANCES | ||||||||||||||
Loans | $ | 3,633,587 | 3,484,511 | 3,373,551 | 3,276,863 | 3,365,686 | 3,559,461 | 3,324,006 | ||||||
Securities | $ | 615,733 | 613,317 | 600,852 | 547,336 | 483,805 | 614,532 | 451,837 | ||||||
Other interest-earning assets | $ | 530,571 | 784,193 | 738,328 | 733,801 | 619,358 | 656,682 | 605,564 | ||||||
Total earning assets (before allowance) | $ | 4,779,891 | 4,882,021 | 4,712,731 | 4,558,000 | 4,468,849 | 4,830,675 | 4,381,407 | ||||||
Total assets | $ | 5,077,458 | 5,168,562 | 5,010,786 | 4,856,611 | 4,752,858 | 5,122,758 | 4,666,372 | ||||||
Noninterest-bearing deposits | $ | 1,706,349 | 1,625,453 | 1,708,052 | 1,641,158 | 1,619,976 | 1,666,125 | 1,565,458 | ||||||
Interest-bearing deposits | $ | 2,201,797 | 2,364,437 | 2,194,644 | 2,125,920 | 2,074,759 | 2,282,667 | 2,050,959 | ||||||
Total deposits | $ | 3,908,146 | 3,989,890 | 3,902,696 | 3,767,078 | 3,694,735 | 3,948,792 | 3,616,417 | ||||||
Total borrowed funds | $ | 705,774 | 707,478 | 632,036 | 614,061 | 594,199 | 706,621 | 585,471 | ||||||
Total interest-bearing liabilities | $ | 2,907,571 | 3,071,915 | 2,826,680 | 2,739,981 | 2,668,958 | 2,989,288 | 2,636,430 | ||||||
Shareholders' equity | $ | 428,873 | 449,863 | 455,084 | 455,902 | 445,930 | 439,310 | 444,761 | ||||||
View original content:https://www.prnewswire.com/news-releases/mercantile-bank-corporation-announces-strong-second-quarter-2022-results-301588663.html
SOURCE Mercantile Bank Corporation
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