Mercantile Bank Corporation Reports Third Quarter 2020 Results

GRAND RAPIDS, Mich., Oct. 20, 2020 /PRNewswire/ -- Mercantile Bank Corporation (NASDAQ: MBWM) ("Mercantile") reported net income of $10.7 million, or $0.66 per diluted share, for the third quarter of 2020, compared with net income of $12.6 million, or $0.77 per diluted share, for the respective prior-year period.  Net income during the first nine months of 2020 totaled $30.1 million, or $1.85 per diluted share, compared to $36.1 million, or $2.20 per diluted share, during the first nine months of 2019.

"In light of the challenging operating environment created by the ongoing COVID-19 pandemic, we are pleased with our overall financial performance during the third quarter of 2020," said Robert B. Kaminski, Jr., President and Chief Executive Officer of Mercantile.  "We have implemented strategic initiatives to address the identifiable impacts of the pandemic, and we will continue to focus on appropriately planning for potential future risks posed by it." 

Third quarter highlights include:

  • Strong capital position
  • Continued solid asset quality metrics
  • Ongoing strength in commercial loan and residential mortgage loan pipelines
  • Substantial increase in mortgage banking income and growth in other key fee income categories
  • Controlled overhead costs

Operating Results

Total revenue, which consists of net interest income and noninterest income, was $42.8 million during the third quarter of 2020, up $4.5 million, or 11.8 percent, from the prior-year third quarter.  Net interest income during the third quarter of 2020 was $29.5 million, down $2.1 million, or 6.6 percent, from the third quarter of 2019, reflecting a decreased net interest margin, which more than offset the positive impact of earning asset growth.  Noninterest income totaled $13.3 million during the third quarter of 2020, up $6.6 million from the respective 2019 period, mainly due to increased mortgage banking income.

The net interest margin was 2.86 percent in the third quarter of 2020, compared to 3.71 percent in the third quarter of 2019.  The yield on average earning assets was 3.45 percent during the third quarter of 2020, down from 4.73 percent during the prior-year third quarter, mainly due to a decreased yield on commercial loans, which equaled 4.06 percent in the current-year third quarter compared to 5.15 percent in the respective 2019 period.  The decreased yield on commercial loans primarily reflected reduced interest rates on variable-rate commercial loans resulting from the Federal Open Market Committee significantly lowering the targeted federal funds rate by a total of 225 basis points during the second half of 2019 and first three months of 2020.  A significant volume of excess on-balance sheet liquidity consisting of low-yielding deposits with the Federal Reserve Bank of Chicago and a correspondent bank negatively impacted the yield on average earning assets during the third quarter of 2020.  The excess funds are mainly a product of federal government stimulus programs as well as lower business and consumer investing and spending.  A lower yield on interest-earning deposits, reflecting the decreasing interest rate environment, also contributed to the reduced yield on average earning assets.

The cost of funds declined from 1.02 percent during the third quarter of 2019 to 0.59 percent during the current-year third quarter, primarily due to lower rates paid on local deposit accounts and borrowings, reflecting the declining interest rate environment.  A change in funding mix, consisting of an increase in lower-costing non-time deposits as a percentage of total funding sources, also contributed to the decrease in the cost of funds.

Mercantile recorded provision expense of $3.2 million during the third quarter of 2020, compared to $7.6 million during the second quarter of 2020 and $0.7 million during the third quarter of 2019.  The provision expense recorded during the current-year third quarter was primarily comprised of increased allocations associated with the downgrading of certain non-impaired commercial loan relationships, while the provision expense recorded during the second quarter of 2020 mainly consisted of an allocation associated with the newly-created COVID-19 pandemic environmental factor ("COVID-19 factor") and an increased allocation related to the existing economic conditions environmental factor.  The COVID-19 factor was added to address the unique challenges and economic uncertainty resulting from the pandemic and its potential impact on the collectability of the loan portfolio.  The provision expense recorded during the third quarter of 2019 mainly reflected ongoing net loan growth.

Noninterest income during the third quarter of 2020 was $13.3 million, representing an increase of $6.6 million, or 99.3 percent, from the $6.7 million recorded during the third quarter of 2019.  The higher level of noninterest income primarily reflected increased mortgage banking income stemming from a substantial upturn in refinance activity spurred by a decrease in residential mortgage loan interest rates, an increase in purchase activity, and the ongoing success of strategic initiatives that were implemented to boost market share.  Growth in credit and debit card income and payroll processing fees also contributed to the increased level of noninterest income.

Noninterest expense totaled $26.4 million during the third quarter of 2020, up $4.4 million, or 20.0 percent, from the prior-year third quarter.  The higher level of expense primarily resulted from increased compensation costs, mainly reflecting higher residential mortgage loan originator commissions and related incentives and an increased bonus accrual.  The higher level of commissions and associated incentives primarily depicted the significant increase in residential mortgage loan originations during the third quarter of 2020, which were up nearly 79 percent compared to the respective 2019 period. 

Mr. Kaminski commented, "The continuing success of strategic initiatives that were implemented to increase market penetration and enhance revenue, combined with strong residential mortgage loan production levels, allowed us to achieve another record breaking level of mortgage banking income during the third quarter of 2020.  Our residential mortgage lending team has put forth a tremendous effort to ensure the entire loan origination process, from the receipt of an application to closing, is completed in an efficient manner, often providing us with a competitive advantage.  We were pleased with the growth in service charges on accounts and credit and debit card income during the third quarter of 2020 compared to the linked quarter, primarily reflecting the relaxation of certain restrictions that were put in place as a result of the COVID-19 pandemic.  Controlling overhead costs remains an integral component of growth initiatives, and we will continue our efforts to ascertain opportunities to function more efficiently."

Balance Sheet

As of September 30, 2020, total assets were $4.42 billion, up $788 million, or 21.7 percent, from December 31, 2019.  Total loans increased $494 million during the first nine months of 2020, primarily reflecting Paycheck Protection Program loan originations of $555 million during the second and third quarters.  Commercial lines of credit remained relatively steady during the third quarter of 2020 after having declined $109 million during the second quarter of 2020 largely due to the impacts of the COVID-19 pandemic environment and federal government stimulus programs.  As of September 30, 2020, unfunded commitments on commercial construction and development loans totaled approximately $99 million, which are expected to be largely funded over the next 12 to 18 months.  Interest-earning deposits increased $315 million during the first nine months of 2020, mainly resulting from growth in certain local deposit account categories and sweep accounts.

Ray Reitsma, President of Mercantile Bank of Michigan, noted, "We are very pleased that our asset quality metrics remained solid throughout the third quarter of 2020, as we continue to closely monitor and evaluate the impact of the COVID-19 pandemic on the performance of our loan portfolio.  Our ongoing focus on sound credit underwriting has served us well during this period of uncertainty and weakened economic conditions.  Past due loan and nonperforming asset levels continue to be low, and a vast majority of commercial and retail loan customers that were granted loan payment deferrals under internally developed programs have reverted back to making full contractual loan payments. As part of our internal loan review program and reflective of our desire to identify potential loan problems in a timely manner, certain non-impaired commercial loan relationships were downgraded during the third quarter to bring the loan risk ratings in sync with the current economic environment and the borrowers' financial conditions, resulting in a substantial portion of the provision expense recorded during the quarter."

Mr. Reitsma added, "Although we continued to assist customers in obtaining funds under the Paycheck Protection Program and began helping loan recipients gather and submit required information to the Small Business Administration for a loan forgiveness determination during the third quarter of 2020, we remained focused on meeting the traditional credit needs of our existing clients and identifying potential new customer relationships.  We are pleased with the level of net commercial loan growth achieved during the third quarter, and based on the strength of our current pipeline, we expect to fund additional commercial loans in future periods."

Excluding the impact of Paycheck Protection Program loan originations, commercial and industrial loans and owner-occupied commercial real estate loans together represented approximately 55 percent of total commercial loans as of September 30, 2020, a level that has remained relatively consistent and in line with internal expectations. 

Total deposits at September 30, 2020, were $3.37 billion, up $682 million, or 25.3 percent, from December 31, 2019.  Local deposits were up $749 million during the first nine months of 2020, while brokered deposits were down $67.5 million during the same time period.  The growth in local deposits mainly reflected Paycheck Protection Program loan proceeds being deposited into customers' accounts at the time the loans were originated and remaining on deposit as of September 30, 2020, along with federal government stimulus payments and reduced business and consumer investing and spending.  Wholesale funds were $460 million, or approximately 12 percent of total funds, as of September 30, 2020, compared to $487 million, or approximately 15 percent of total funds, as of December 31, 2019.

Asset Quality

Nonperforming assets at September 30, 2020, were $4.7 million, or 0.1 percent of total assets, compared to $2.7 million, or 0.1 percent of total assets, at December 31, 2019, and $2.9 million, or 0.1 percent of total assets, at September 30, 2019.  During the third quarter of 2020, loan charge-offs totaled $0.1 million, while recoveries of prior-period loan charge-offs equaled $0.2 million, providing for net loan recoveries of $0.1 million, or an annualized 0.02 percent of average total loans.

Capital Position

Shareholders' equity totaled $432 million as of September 30, 2020, an increase of $15.3 million from year-end 2019.  The Bank's capital position remains above "well-capitalized" with a total risk-based capital ratio of 13.5 percent as of September 30, 2020, compared to 13.0 percent at December 31, 2019.  At September 30, 2020, the Bank had approximately $116 million in excess of the 10.0 percent minimum regulatory threshold required to be considered a "well-capitalized" institution.  Mercantile reported 16,243,124 total shares outstanding at September 30, 2020.

As part of a $20 million common stock repurchase program announced in May 2019 and instituted in conjunction with the completion of its existing program that was introduced in January 2015 and later expanded in April 2016, Mercantile repurchased approximately 222,000 shares for $6.3 million, or a weighted average all-in cost per share of $28.25, during the first quarter of 2020; no shares were repurchased during the second and third quarters of 2020.  Mercantile has elected to temporarily cease stock repurchases to preserve capital for lending and other purposes while management assesses the potential impacts of the COVID-19 pandemic.  Management has the ability to reinstate the buyback program as circumstances warrant.

Mr. Kaminski concluded, "As part of our COVID-19 pandemic response plan, we have continued to utilize information distributed by government agencies and health officials as a basis for pandemic-related actions designed to provide clients with needed banking services while protecting them and our employees from the spread of the coronavirus to the fullest extent possible.  We will continue to closely monitor new pandemic-related developments and revise the response plan as necessary.  We were pleased to announce earlier today that our Board of Directors declared a regular quarterly cash dividend.  Our sustained financial strength has allowed us to continue the cash dividend program and provide our shareholders with a cash return on their investments despite the uncertainty stemming from the pandemic and associated deterioration in economic conditions."

Investor Presentation

Mercantile has prepared presentation materials (the "Conference Call & Webcast Presentation") that management intends to use during its previously announced third quarter 2020 conference call on Tuesday, October 20, 2020, at 10:00 a.m. Eastern Time, and from time to time thereafter in presentations about the Company's operations and performance.  The Investor Presentation also contains more detailed information relating to Mercantile's COVID-19 pandemic response plan.  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 of Michigan.  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 $4.4 billion and operates 40 banking offices.  Mercantile Bank Corporation's common stock is listed on the NASDAQ Global Select Market under the symbol "MBWM."

Forward-Looking Statements

This news release contains comments or information that may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  Any such comments 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; demand for products and services; the degree of competition by traditional and nontraditional competitors; changes in banking regulation or actions by bank regulators; changes in tax laws; changes in prices, levies, and assessments; the impact of technological advances; governmental and regulatory policy changes; the outcomes of contingencies; trends in customer behavior as well as their ability to repay loans; changes in local real estate values; changes in the national and local economies, including the significant disruption to financial market and other economic activity caused by the outbreak of COVID-19; and other factors, including 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.

FOR FURTHER INFORMATION:

Robert B. Kaminski, Jr.  

Charles Christmas

President & CEO    

Executive Vice President & CFO

616-726-1502        

616-726-1202

rkaminski@mercbank.com      

cchristmas@mercbank.com

 

Mercantile Bank Corporation







Third Quarter 2020 Results







MERCANTILE BANK CORPORATION

CONSOLIDATED BALANCE SHEETS

(Unaudited)










SEPTEMBER 30,


DECEMBER 31,


SEPTEMBER 30,



2020


2019


2019

ASSETS







   Cash and due from banks

$

59,283,000

$

53,262,000

$

84,275,000

   Interest-earning deposits


495,308,000


180,469,000


144,263,000

      Total cash and cash equivalents


554,591,000


233,731,000


228,538,000








   Securities available for sale


312,424,000


334,655,000


345,533,000

   Federal Home Loan Bank stock


18,002,000


18,002,000


18,002,000








   Loans


3,350,544,000


2,856,667,000


2,933,013,000

   Allowance for loan losses


(35,572,000)


(23,889,000)


(24,414,000)

      Loans, net


3,314,972,000


2,832,778,000


2,908,599,000








   Premises and equipment, net


60,446,000


57,327,000


54,585,000

   Bank owned life insurance


71,170,000


70,297,000


67,993,000

   Goodwill


49,473,000


49,473,000


49,473,000

   Core deposit intangible, net


2,754,000


3,840,000


4,237,000

   Other assets


36,778,000


32,812,000


33,420,000








      Total assets

$

4,420,610,000

$

3,632,915,000

$

3,710,380,000















LIABILITIES AND SHAREHOLDERS' EQUITY







   Deposits:







      Noninterest-bearing

$

1,449,879,000

$

924,916,000

$

967,189,000

      Interest-bearing


1,922,155,000


1,765,468,000


1,799,902,000

         Total deposits


3,372,034,000


2,690,384,000


2,767,091,000








   Securities sold under agreements to repurchase


157,017,000


102,675,000


103,990,000

   Federal Home Loan Bank advances


394,000,000


354,000,000


364,000,000

   Subordinated debentures


47,392,000


46,881,000


46,710,000

   Accrued interest and other liabilities


18,267,000


22,414,000


21,389,000

         Total liabilities


3,988,710,000


3,216,354,000


3,303,180,000








SHAREHOLDERS' EQUITY







   Common stock


301,896,000


305,035,000


304,065,000

   Retained earnings


124,451,000


107,831,000


98,876,000

   Accumulated other comprehensive income/(loss)


5,553,000


3,695,000


4,259,000

      Total shareholders' equity


431,900,000


416,561,000


407,200,000








      Total liabilities and shareholders' equity

$

4,420,610,000

$

3,632,915,000

$

3,710,380,000

 

Mercantile Bank Corporation














Third Quarter 2020 Results














MERCANTILE BANK CORPORATION

CONSOLIDATED REPORTS OF INCOME

(Unaudited)
















THREE MONTHS ENDED


THREE MONTHS ENDED

NINE MONTHS ENDED

NINE MONTHS ENDED


September 30, 2020


September 30, 2019

September 30, 2020

September 30, 2019

INTEREST INCOME














   Loans, including fees

$

33,664,000



$

37,005,000


$

101,428,000


$

109,559,000


   Investment securities


1,788,000




2,660,000



8,554,000



7,587,000


   Other interest-earning assets


142,000




651,000



711,000



1,627,000


      Total interest income


35,594,000




40,316,000



110,693,000



118,773,000
















INTEREST EXPENSE














   Deposits


3,466,000




5,573,000



11,808,000



15,906,000


   Short-term borrowings


38,000




71,000



132,000



244,000


   Federal Home Loan Bank advances


2,072,000




2,257,000



6,499,000



6,751,000


   Other borrowed money


509,000




810,000



1,857,000



2,506,000


      Total interest expense


6,085,000




8,711,000



20,296,000



25,407,000
















      Net interest income


29,509,000




31,605,000



90,397,000



93,366,000
















Provision for loan losses


3,200,000




700,000



11,550,000



2,450,000
















      Net interest income after














         provision for loan losses


26,309,000




30,905,000



78,847,000



90,916,000
















NONINTEREST INCOME














   Service charges on accounts


1,135,000




1,185,000



3,401,000



3,406,000


   Mortgage banking income


9,479,000




2,889,000



19,746,000



5,291,000


   Credit and debit card income


1,636,000




1,547,000



4,371,000



4,397,000


   Payroll services


399,000




367,000



1,346,000



1,227,000


   Earnings on bank owned life insurance


290,000




330,000



933,000



3,567,000


   Other income


368,000




358,000



1,042,000



1,755,000


      Total noninterest income


13,307,000




6,676,000



30,839,000



19,643,000
















NONINTEREST EXPENSE














   Salaries and benefits


16,734,000




13,680,000



44,388,000



39,982,000


   Occupancy


2,023,000




1,697,000



5,944,000



5,089,000


   Furniture and equipment


871,000




629,000



2,500,000



1,885,000


   Data processing costs


2,676,000




2,342,000



7,793,000



6,854,000


   Other expense


4,119,000




3,679,000



11,954,000



12,134,000


      Total noninterest expense


26,423,000




22,027,000



72,579,000



65,944,000
















      Income before federal income














         tax expense


13,193,000




15,554,000



37,107,000



44,615,000
















Federal income tax expense


2,507,000




2,954,000



7,051,000



8,476,000
















      Net Income

$

10,686,000



$

12,600,000


$

30,056,000


$

36,139,000
















   Basic earnings per share


$0.66




$0.77



$1.85



$2.20


   Diluted earnings per share


$0.66




$0.77



$1.85



$2.20
















   Average basic shares outstanding


16,233,196




16,390,203



16,265,208



16,415,843


   Average diluted shares outstanding


16,233,666




16,393,078



16,265,986



16,420,845


 

Mercantile Bank Corporation















Third Quarter 2020 Results















MERCANTILE BANK CORPORATION

CONSOLIDATED FINANCIAL HIGHLIGHTS

(Unaudited)


















Quarterly


Year-To-Date

(dollars in thousands except per share data)

2020


2020


2020


2019


2019







3rd Qtr


2nd Qtr


1st Qtr


4th Qtr


3rd Qtr


2020


2019

EARNINGS















   Net interest income

$

29,509


30,571


30,317


31,168


31,605


90,397


93,366

   Provision for loan losses

$

3,200


7,600


750


(700)


700


11,550


2,450

   Noninterest income

$

13,307


10,984


6,550


7,312


6,676


30,839


19,643

   Noninterest expense

$

26,423


23,216


22,940


23,335


22,027


72,579


65,944

   Net income before federal income















      tax expense

$

13,193


10,739


13,177


15,845


15,554


37,107


44,615

   Net income

$

10,686


8,698


10,673


13,317


12,600


30,056


36,139

   Basic earnings per share

$

0.66


0.54


0.65


0.81


0.77


1.85


2.20

   Diluted earnings per share

$

0.66


0.54


0.65


0.81


0.77


1.85


2.20

   Average basic shares outstanding


16,233,196


16,212,500


16,350,281


16,373,458


16,390,203


16,265,208


16,415,843

   Average diluted shares outstanding


16,233,666


16,213,264


16,351,559


16,375,740


16,393,078


16,265,986


16,420,845
















PERFORMANCE RATIOS















   Return on average assets


0.98%


0.85%


1.19%


1.45%


1.38%


0.99%


1.37%

   Return on average equity


9.86%


8.26%


10.20%


12.87%


12.39%


9.44%


12.40%

   Net interest margin (fully tax-equivalent)

2.86%


3.17%


3.63%


3.63%


3.71%


3.19%


3.79%

   Efficiency ratio


61.71%


55.87%


62.22%


60.64%


57.54%


59.87%


58.40%

   Full-time equivalent employees


618


637


626


619


624


618


624
















YIELD ON ASSETS / COST OF FUNDS















   Yield on loans


4.03%


4.18%


4.69%


5.01%


5.06%


4.28%


5.15%

   Yield on securities


2.26%


3.37%


4.73%


2.90%


2.99%


3.47%


2.89%

   Yield on other interest-earning assets


0.12%


0.15%


1.22%


1.65%


2.15%


0.32%


2.32%

   Yield on total earning assets


3.45%


3.85%


4.54%


4.61%


4.73%


3.91%


4.82%

   Yield on total assets


3.25%


3.62%


4.23%


4.31%


4.42%


3.67%


4.50%

   Cost of deposits


0.41%


0.48%


0.70%


0.79%


0.83%


0.52%


0.82%

   Cost of borrowed funds


1.78%


1.91%


2.31%


2.36%


2.35%


1.98%


2.39%

   Cost of interest-bearing liabilities


0.99%


1.11%


1.36%


1.47%


1.52%


1.15%


1.52%

   Cost of funds (total earning assets)


0.59%


0.68%


0.91%


0.98%


1.02%


0.72%


1.03%

   Cost of funds (total assets)


0.56%


0.64%


0.85%


0.91%


0.95%


0.67%


0.96%
















PURCHASE ACCOUNTING ADJUSTMENTS














   Loan portfolio - increase interest income

$

332


169


285


316


327


786


1,107

   Trust preferred - increase interest expense

$

171


171


171


171


171


513


513

   Core deposit intangible - increase overhead

$

318


371


397


397


397


1,086


1,324
















MORTGAGE BANKING ACTIVITY















   Total mortgage loans originated

$

237,195


275,486


132,859


110,611


132,852


645,540


257,989

   Purchase mortgage loans originated

$

93,068


58,015


46,538


49,407


61,839


197,621


133,716

   Refinance mortgage loans originated

$

144,127


217,471


86,321


61,204


71,013


447,919


124,273

   Total mortgage loans sold

$

191,318


225,665


95,327


81,590


104,890


512,310


175,788

   Income on sale of mortgage loans

$

10,199


7,760


2,086


3,062


2,886


20,045


5,003
















CAPITAL















   Tangible equity to tangible assets


8.69%


8.74%


10.14%


10.15%


9.67%


8.69%


9.67%

   Tier 1 leverage capital ratio


9.80%


10.21%


11.47%


11.28%


11.08%


9.80%


11.08%

   Common equity risk-based capital ratio


11.37%


11.34%


10.92%


11.00%


10.53%


11.37%


10.53%

   Tier 1 risk-based capital ratio


12.74%


12.74%


12.28%


12.36%


11.87%


12.74%


11.87%

   Total risk-based capital ratio


13.82%


13.73%


13.03%


13.09%


12.60%


13.82%


12.60%

   Tier 1 capital

$

420,225


412,526


406,445


405,148


395,010


420,225


395,010

   Tier 1 plus tier 2 capital

$

455,797


444,772


431,273


429,038


419,424


455,797


419,424

   Total risk-weighted assets

$

3,298,047


3,238,444


3,309,336


3,276,754


3,327,723


3,298,047


3,327,723

   Book value per common share

$

26.59


26.20


25.82


25.36


24.93


26.59


24.93

   Tangible book value per common share

$

23.37


22.96


22.55


22.12


21.64


23.37


21.64

   Cash dividend per common share

$

0.28


0.28


0.28


0.27


0.27


0.84


0.79
















ASSET QUALITY















   Gross loan charge-offs

$

124


335


40


112


519


499


771

   Recoveries

$

250


153


229


287


180


632


355

   Net loan charge-offs (recoveries)

$

(126)


182


(189)


(175)


339


(133)


416

   Net loan charge-offs to average loans


(0.02%)


0.02%


(0.03%)


(0.02%)


0.05%


(0.01%)


0.02%

   Allowance for loan losses

$

35,572


32,246


24,828


23,889


24,414


35,572


24,414

   Allowance to loans


1.06%


0.97%


0.86%


0.89%


0.88%


1.06%


0.88%

   Allowance to loans excluding PPP loans


1.27%


1.16%


0.86%


0.89%


0.88%


1.27%


0.88%

   Nonperforming loans

$

4,141


3,212


3,469


2,284


2,644


4,141


2,644

   Other real estate/repossessed assets

$

512


198


271


452


243


512


243

   Nonperforming loans to total loans


0.12%


0.10%


0.12%


0.08%


0.09%


0.12%


0.09%

   Nonperforming assets to total assets


0.11%


0.08%


0.10%


0.08%


0.08%


0.11%


0.08%
















NONPERFORMING ASSETS - COMPOSITION













   Residential real estate:















      Land development

$

36


36


37


34


32


36


32

      Construction

$

198


198


283


0


0


198


0

      Owner occupied / rental

$

2,597


2,750


2,922


2,364


2,576


2,597


2,576

   Commercial real estate:















      Land development

$

0


0


43


0


0


0


0

      Construction

$

0


0


0


0


0


0


0

      Owner occupied  

$

1,576


275


287


326


240


1,576


240

      Non-owner occupied

$

23


25


0


0


26


23


26

   Non-real estate:















      Commercial assets

$

198


98


156


0


0


198


0

      Consumer assets

$

25


28


12


12


13


25


13

   Total nonperforming assets


4,653


3,410


3,740


2,736


2,887


4,653


2,887
















NONPERFORMING ASSETS - RECON















   Beginning balance

$

3,410


3,740


2,736


2,887


3,951


2,736


4,952

   Additions - originated loans/former branch

$

1,615


220


1,344


30


339


3,179


904

   Other activity

$

0


0


(31)


135


57


(31)


91

   Return to performing status

$

(72)


(26)


(7)


0


(126)


(105)


(126)

   Principal payments

$

(249)


(278)


(110)


(232)


(1,014)


(637)


(1,908)

   Sale proceeds

$

0


(49)


(192)


(36)


(253)


(241)


(756)

   Loan charge-offs

$

(51)


(173)


0


(48)


(59)


(224)


(241)

   Valuation write-downs

$

0


(24)


0


0


(8)


(24)


(29)

   Ending balance

$

4,653


3,410


3,740


2,736


2,887


4,653


2,887
















LOAN PORTFOLIO COMPOSITION















   Commercial:















      Commercial & industrial

$

1,321,419


1,307,456


873,679


846,551


882,747


1,321,419


882,747

      Land development & construction

$

50,941


52,984


62,908


56,118


48,418


50,941


48,418

      Owner occupied comm'l R/E

$

549,364


567,621


579,229


579,004


567,267


549,364


567,267

      Non-owner occupied comm'l R/E

$

878,897


841,145


823,366


835,345


883,079


878,897


883,079

      Multi-family & residential rental

$

137,740


132,047


133,148


124,526


126,855


137,740


126,855

         Total commercial

$

2,938,361


2,901,253


2,472,330


2,441,544


2,508,366


2,938,361


2,508,366

   Retail:















      1-4 family mortgages

$

348,460


367,060


356,338


339,749


346,095


348,460


346,095

      Home equity & other consumer

$

63,723


64,743


72,875


75,374


78,552


63,723


78,552

         Total retail

$

412,183


431,803


429,213


415,123


424,647


412,183


424,647

         Total loans

$

3,350,544


3,333,056


2,901,543


2,856,667


2,933,013


3,350,544


2,933,013
















END OF PERIOD BALANCES















   Loans

$

3,350,544


3,333,056


2,901,543


2,856,667


2,933,013


3,350,544


2,933,013

   Securities

$

330,426


325,663


330,149


352,657


363,535


330,426


363,535

   Other interest-earning assets

$

495,308


386,711


186,938


180,469


144,263


495,308


144,263

   Total earning assets (before allowance)

$

4,176,278


4,045,430


3,418,630


3,389,793


3,440,811


4,176,278


3,440,811

   Total assets

$

4,420,610


4,314,379


3,657,387


3,632,915


3,710,380


4,420,610


3,710,380

   Noninterest-bearing deposits

$

1,449,879


1,445,620


956,290


924,916


967,189


1,449,879


967,189

   Interest-bearing deposits

$

1,922,155


1,816,660


1,689,126


1,765,468


1,799,902


1,922,155


1,799,902

   Total deposits

$

3,372,034


3,262,280


2,645,416


2,690,384


2,767,091


3,372,034


2,767,091

   Total borrowed funds

$

600,892


611,298


576,996


506,301


517,523


600,892


517,523

   Total interest-bearing liabilities

$

2,523,047


2,427,958


2,266,122


2,271,769


2,317,425


2,523,047


2,317,425

   Shareholders' equity

$

431,900


425,221


418,389


416,561


407,200


431,900


407,200
















AVERAGE BALANCES















   Loans

$

3,315,741


3,294,883


2,861,047


2,871,674


2,903,161


3,157,802


2,846,735

   Securities

$

327,668


333,843


344,906


362,347


363,394


335,443


358,557

   Other interest-earning assets

$

457,598


251,833


153,638


176,034


118,314


288,310


93,800

   Total earning assets (before allowance)

$

4,101,007


3,880,559


3,359,591


3,410,055


3,384,869


3,781,555


3,299,092

   Total assets

$

4,346,624


4,119,573


3,602,784


3,650,087


3,622,168


4,024,175


3,531,841

   Noninterest-bearing deposits

$

1,454,887


1,304,986


923,827


948,602


930,851


1,228,729


886,536

   Interest-bearing deposits

$

1,863,302


1,767,985


1,724,030


1,759,377


1,741,563


1,785,391


1,710,120

   Total deposits

$

3,318,189


3,072,971


2,647,857


2,707,979


2,672,414


3,014,120


2,596,656

   Total borrowed funds

$

583,994


607,074


517,961


509,932


529,590


569,729


531,073

   Total interest-bearing liabilities

$

2,447,296


2,375,059


2,241,991


2,269,309


2,271,153


2,355,120


2,241,193

   Shareholders' equity

$

429,865


422,230


419,612


410,593


403,350


423,924


389,628

 

Cision View original content:http://www.prnewswire.com/news-releases/mercantile-bank-corporation-reports-third-quarter-2020-results-301155212.html

SOURCE Mercantile Bank Corporation

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