Press Release

Mercantile Bank Corporation Reports Strong Third Quarter 2018 Results

Healthy loan growth and continued strength in core profitability highlight quarter

Company Release - 10/16/2018 6:01 AM ET

GRAND RAPIDS, Mich., Oct. 16, 2018 /PRNewswire/ -- Mercantile Bank Corporation (NASDAQ: MBWM) ("Mercantile") reported net income of $10.1 million, or $0.61 per diluted share, for the third quarter of 2018, compared with net income of $8.3 million, or $0.51 per diluted share, for the respective prior-year period.  Net income during the first nine months of 2018 totaled $30.5 million, or $1.83 per diluted share, compared to $23.3 million, or $1.41 per diluted share, during the first nine months of 2017.

Interest income related to purchased loan accounting entries increased net income during the third quarter of 2018 by $0.3 million, or $0.02 per diluted share, and net income during the first nine months of 2018 by $2.7 million, or $0.16 per diluted share; during the respective 2017 periods, net income increased $1.1 million, or $0.07 per diluted share, and $2.6 million, or $0.15 per diluted share, as a result of these entries.  A bank owned life insurance claim during the first quarter of 2017 increased reported net income during the first nine months of 2017 by $1.2 million, or $0.07 per diluted share.  Excluding the impacts of these transactions, diluted earnings per share increased $0.15, or 34.1 percent, during the third quarter of 2018 compared to the prior-year third quarter, and $0.48, or 40.3 percent, during the first nine months of 2018 compared to the respective 2017 period.

Net income during the third quarter of 2018 and the first nine months of 2018 benefited from a reduction in the corporate federal income tax rate, which was lowered from 35 percent to 21 percent on January 1, 2018, as a result of the enactment of the Tax Cuts and Jobs Act.  Mercantile's effective tax rate was 19.0 percent during both the third quarter and first nine months of 2018, down from 30.8 percent and 30.7 percent during the respective prior-year periods.

"We are pleased to report that our current quarter operating results represent a continuation of the robust performance demonstrated during the first half of the year," said Robert B. Kaminski, Jr., President and Chief Executive Officer of Mercantile.  "Our sustained strength in core profitability, sound capital position, and healthy commercial and residential mortgage loan pipelines position us to finish the year in strong fashion and take advantage of future growth opportunities."

Third quarter highlights include:

  • Strong earnings performance and capital position
  • Robust net interest margin
  • Growth in several fee income categories
  • Controlled overhead costs
  • Strong asset quality, as reflected by low levels of nonperforming assets and loans in the 30- to 89-days delinquent category
  • New commercial term loan originations of approximately $119 million
  • Continued strength in commercial loan pipeline

Operating Results

Total revenue, which consists of net interest income and noninterest income, was $34.5 million during the third quarter of 2018, up $1.3 million, or 3.9 percent, from the prior-year third quarter.  Net interest income during the third quarter of 2018 was $29.8 million, up $1.2 million, or 4.2 percent, from the third quarter of 2017, reflecting a higher level of earning assets and an increased net interest margin. 

The net interest margin was 3.87 percent in the third quarter of 2018, up from 3.83 percent in the prior-year third quarter.  The improved net interest margin exhibits a higher yield on average earning assets, primarily reflecting an increased yield on commercial loans and a change in earning asset mix, which more than offset a higher cost of funds, mainly due to increased costs of certain non-time deposit accounts, time deposits, and borrowed funds.  The increased yield on commercial loans primarily reflects the impact of higher interest rates on certain variable-rate commercial loans stemming from the Federal Open Market Committee raising the targeted federal funds rate by 25 basis points in each of the past four quarters.  The change in earning asset mix mainly reflects loan growth and a reduction in interest-earning deposit balances.  On average, higher-yielding loans represented 86.8 percent of earning assets during the third quarter of 2018, up from 84.8 percent during the prior-year third quarter, while lower-yielding interest-earning deposit balances represented 2.0 percent of earning assets during the current-year third quarter, down from 3.9 percent during the respective 2017 period.

Net interest income and the net interest margin during the third quarters of 2018 and 2017 were affected by purchase accounting accretion and amortization entries associated with the fair value measurements recorded effective June 1, 2014.  Increases in interest income on loans totaling $0.4 million and $1.8 million were recorded during the third quarters of 2018 and 2017, respectively.  Purchased loan accretion amounts vary from period to period as a result of periodic cash flow re-estimations, loan payoffs, and payment performance.  Increases in interest expense on subordinated debentures totaling $0.2 million were recorded during both the current-year third quarter and prior-year third quarter. 

Mercantile recorded provisions for loan losses of $0.4 million and $1.0 million during the third quarters of 2018 and 2017, respectively.  The provision expense recorded during the third quarter of 2018 primarily reflects loan growth, while the provision expense recorded during the prior-year third quarter mainly reflects an increased allocation related to the economic conditions environmental factor and loan growth.

Noninterest income during the third quarter of 2018 was $4.7 million, up $0.1 million, or 2.2 percent, from the $4.6 million recorded during the third quarter of 2017.  The increase in noninterest income primarily reflects higher credit and debit card fees, service charges on accounts, and payroll processing revenue.  Mortgage banking activity income declined slightly in the third quarter of 2018 compared to the prior-year third quarter, mainly reflecting the impacts of rising residential mortgage loan interest rates and a limited supply of homes for sale in Mercantile's markets.

Noninterest expense totaled $21.7 million during the third quarter of 2018, up $1.4 million, or 7.1 percent, from the respective 2017 period.  The higher level of expense primarily resulted from increased salary costs, mainly reflecting annual employee merit pay increases and higher stock-based compensation expense, as well as pay increases for all hourly employees.

Mr. Kaminski continued, "As anticipated, our net interest margin remained strong during the third quarter of 2018, reflecting ongoing sound asset quality, disciplined loan pricing, and a beneficial balance sheet structure.  Our cost of funds continued to trend upwards in the third quarter, reflecting the continuing rising interest rate environment; however, its impact was more than offset by an increased yield on earning assets, primarily reflecting higher interest rates on certain variable-rate commercial loans.  We believe that our current balance sheet structure postures our net interest income to benefit from any further Federal Open Market Committee tightening.  Our strategic initiatives related to enhancing fee income continue to be successful, and we remain focused on controlling overhead costs.  Although mortgage banking activity income continues to be hampered by the increasing interest rate environment and lack of inventory in our markets, we are pleased with the current pipeline and elevated level of pre-qualifications, and are enhancing our efforts to sell a greater percentage of originated mortgage loans."

Balance Sheet

As of September 30, 2018, total assets were $3.30 billion, up $13.4 million from December 31, 2017.  Over the same time period, total loans increased $139 million, equating to an annualize growth rate of 7.2 percent, while interest-earning deposits decreased $117 million, or 80.6 percent.  During the twelve months ended September 30, 2018, total loans were up $143 million, or 5.6 percent, while interest-earning deposits were down $94.9 million, or 77.1 percent.  The declines in interest-earning deposit balances primarily resulted from the funds being used to meet loan funding requirements.  Approximately $119 million in commercial term loans to new and existing borrowers were originated during the third quarter of 2018, as continuing sales and relationship-building efforts resulted in additional lending opportunities.  As of September 30, 2018, unfunded commitments on commercial construction and development loans totaled approximately $152 million, which are expected to be largely funded over the next 12 to 18 months.

Raymond Reitsma, President of Mercantile Bank of Michigan, noted, "After experiencing sluggish net loan growth during the fourth quarter of 2017 and a slight contraction in the loan portfolio during the first quarter of 2018 primarily due to certain larger commercial loan payoffs, we are very pleased with the net growth of $146 million during the combined second and third quarters of the current year, which produced an annualized growth rate of about 7 percent for the first nine months of 2018.  The loan growth realized during the past two quarters reflects growth in the commercial portfolio, most notably in the commercial and industrial category, as well as the residential mortgage loan portfolio.  We continue to attract new customer relationships and meet the needs of our existing customers with an ongoing commitment to sound underwriting and appropriate pricing.  Based on our current pipeline, we believe that the commercial loan portfolio will reflect solid growth in future periods.  Our strategic initiatives that were designed to increase residential mortgage market penetration continue to be effective, as depicted by growth in the portfolio for the tenth consecutive quarter.  Residential mortgage loan pre-qualifications remain elevated, with the current level being about two times higher than the level at the same time last year."

As of September 30, 2018, commercial and industrial loans and owner-occupied commercial real estate ("CRE") loans combined represented approximately 59 percent of total commercial loans, while non-owner occupied CRE loans equaled about 35 percent of total commercial loans. 

Total deposits at September 30, 2018 were $2.51 billion, down $13.6 million and up $19.8 million from December 31, 2017, and September 30, 2017, respectively, while local deposits were up $7.9 million and $43.2 million during the respective time periods.  New commercial loan relationships and the success of various deposit account initiatives drove the growth in local deposits.  Wholesale funds were $321 million, or approximately 11 percent of total funds, as of September 30, 2018, compared to $323 million and $325 million as of December 31, 2017, and September 30, 2017, respectively.

Asset Quality

Nonperforming assets at September 30, 2018, were $5.8 million, or 0.2 percent of total assets, compared to $9.4 million, or 0.3 percent of total assets, at December 31, 2017.  The decline in nonperforming assets during the first nine months of 2018 primarily reflects successful loan collection efforts and sales of bank-owned properties that were no longer being used or considered for use as bank facilities.  The level of past due loans remains nominal, and loan relationships on the internal watch list generally declined in number and dollar volume during the first nine months of 2018.  Net loan recoveries were $0.1 million during the third quarter of 2018 and $1.1 million during the first nine months of 2018.  Net loan charge-offs totaled $0.1 million during the prior-year third quarter and $1.1 million during the first nine months of 2017.

Capital Position

Shareholders' equity totaled $379 million as of September 30, 2018, an increase of $13.6 million from year-end 2017.  The Bank's capital position remains above "well-capitalized" with a total risk-based capital ratio of 12.8 percent as of September 30, 2018, compared to 12.6 percent at December 31, 2017.  At September 30, 2018, the Bank had approximately $87 million in excess of the 10.0 percent minimum regulatory threshold required to be considered a "well-capitalized" institution.  Mercantile reported 16,616,502 total shares outstanding at September 30, 2018.

Mr. Kaminski concluded, "Our strong financial performance during the first nine months of 2018 positions us to meet profitability and growth targets.  As evidenced by the ongoing cash dividend program, including the announcement of an increased fourth quarter dividend and special dividend earlier today, we remain committed to enhancing total shareholder value.  Our market-leading products and services and focus on developing mutually-beneficial relationships have been instrumental in our ability to gain new clients and retain existing customers successfully.   We are excited about the opportunities that are available to us in our markets as we continue to seek out prospective customers."

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 $3.3 billion and operates 47 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 constitute forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995) that 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; 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.

Mercantile Bank Corporation







Third Quarter 2018 Results







MERCANTILE BANK CORPORATION

CONSOLIDATED BALANCE SHEETS

(Unaudited)










SEPTEMBER 30,


DECEMBER 31,


SEPTEMBER 30,



2018


2017


2017

ASSETS







   Cash and due from banks

$

51,824,000

$

55,127,000

$

53,941,000

   Interest-earning deposits


28,193,000


144,974,000


123,110,000

      Total cash and cash equivalents


80,017,000


200,101,000


177,051,000








   Securities available for sale


326,531,000


335,744,000


330,090,000

   Federal Home Loan Bank stock


11,072,000


11,036,000


11,036,000








   Loans


2,697,417,000


2,558,552,000


2,554,272,000

   Allowance for loan losses


(21,692,000)


(19,501,000)


(19,193,000)

      Loans, net


2,675,725,000


2,539,051,000


2,535,079,000








   Premises and equipment, net


48,104,000


46,034,000


45,606,000

   Bank owned life insurance


69,628,000


68,689,000


66,858,000

   Goodwill


49,473,000


49,473,000


49,473,000

   Core deposit intangible


6,038,000


7,600,000


8,156,000

   Other assets


33,518,000


28,976,000


31,306,000








      Total assets

$

3,300,106,000

$

3,286,704,000

$

3,254,655,000















LIABILITIES AND SHAREHOLDERS' EQUITY







   Deposits:







      Noninterest-bearing

$

879,442,000

$

866,380,000

$

826,038,000

      Interest-bearing


1,629,368,000


1,655,985,000


1,663,005,000

         Total deposits


2,508,810,000


2,522,365,000


2,489,043,000








   Securities sold under agreements to repurchase


112,378,000


118,748,000


122,280,000

   Federal Home Loan Bank advances


240,000,000


220,000,000


220,000,000

   Subordinated debentures


46,029,000


45,517,000


45,347,000

   Accrued interest and other liabilities


13,424,000


14,204,000


15,439,000

         Total liabilities


2,920,641,000


2,920,834,000


2,892,109,000








SHAREHOLDERS' EQUITY







   Common stock


312,544,000


309,772,000


309,033,000

   Retained earnings


80,275,000


61,001,000


55,258,000

   Accumulated other comprehensive income/(loss)


(13,354,000)


(4,903,000)


(1,745,000)

      Total shareholders' equity


379,465,000


365,870,000


362,546,000








      Total liabilities and shareholders' equity

$

3,300,106,000

$

3,286,704,000

$

3,254,655,000

 

 

Mercantile Bank Corporation

Third Quarter 2018 Results

MERCANTILE BANK CORPORATION

CONSOLIDATED REPORTS OF INCOME

(Unaudited)



THREE MONTHS ENDED



THREE MONTHS ENDED


NINE MONTHS ENDED


NINE MONTHS ENDED


September 30, 2018



September 30, 2017


September 30, 2018


September 30, 2017

INTEREST INCOME













   Loans, including fees

$

32,918,000



$

30,746,000


$

97,087,000


$

86,406,000

   Investment securities


2,255,000




1,906,000



6,628,000



5,594,000

   Other interest-earning assets


313,000




382,000



1,071,000



641,000

      Total interest income


35,486,000




33,034,000



104,786,000



92,641,000














INTEREST EXPENSE













   Deposits


3,574,000




2,652,000



9,921,000



6,543,000

   Short-term borrowings


63,000




45,000



181,000



142,000

   Federal Home Loan Bank advances


1,201,000




1,033,000



3,134,000



2,690,000

   Other borrowed money


808,000




660,000



2,286,000



1,920,000

      Total interest expense


5,646,000




4,390,000



15,522,000



11,295,000














      Net interest income


29,840,000




28,644,000



89,264,000



81,346,000














Provision for loan losses


400,000




1,000,000



1,100,000



2,350,000














      Net interest income after













         provision for loan losses


29,440,000




27,644,000



88,164,000



78,996,000














NONINTEREST INCOME













   Service charges on accounts


1,127,000




1,076,000



3,259,000



3,148,000

   Credit and debit card income


1,378,000




1,215,000



3,955,000



3,497,000

   Mortgage banking income


1,235,000




1,326,000



3,115,000



3,233,000

   Payroll services


328,000




285,000



1,128,000



983,000

   Earnings on bank owned life insurance


318,000




328,000



969,000



2,394,000

   Other income


322,000




375,000



1,213,000



1,243,000

      Total noninterest income


4,708,000




4,605,000



13,639,000



14,498,000














NONINTEREST EXPENSE













   Salaries and benefits


12,932,000




11,636,000



38,027,000



33,796,000

   Occupancy


1,648,000




1,598,000



5,049,000



4,707,000

   Furniture and equipment


659,000




543,000



1,789,000



1,625,000

   Data processing costs


2,150,000




2,071,000



6,415,000



6,155,000

   Other expense


4,261,000




4,362,000



12,931,000



13,585,000

      Total noninterest expense


21,650,000




20,210,000



64,211,000



59,868,000














      Income before federal income













         tax expense


12,498,000




12,039,000



37,592,000



33,626,000














Federal income tax expense


2,375,000




3,702,000



7,142,000



10,331,000














      Net Income

$

10,123,000



$

8,337,000


$

30,450,000


$

23,295,000














   Basic earnings per share


$0.61




$0.51



$1.83



$1.41

   Diluted earnings per share


$0.61




$0.51



$1.83



$1.41














   Average basic shares outstanding


16,611,411




16,483,492



16,602,701



16,463,245

   Average diluted shares outstanding


16,619,295




16,494,540



16,610,544



16,474,534

 

 

Mercantile Bank Corporation

Third Quarter 2018 Results

MERCANTILE BANK CORPORATION

CONSOLIDATED FINANCIAL HIGHLIGHTS

(Unaudited)




Quarterly


Year-To-Date

(dollars in thousands except per share data)

2018


2018


2018


2017


2017







3rd Qtr


2nd Qtr


1st Qtr


4th Qtr


3rd Qtr


2018


2017

EARNINGS















   Net interest income

$

29,840


29,225


30,199


28,402


28,644


89,264


81,346

   Provision for loan losses

$

400


700


0


600


1,000


1,100


2,350

   Noninterest income

$

4,708


4,550


4,381


4,503


4,605


13,639


14,498

   Noninterest expense

$

21,650


21,414


21,147


19,848


20,210


64,211


59,868

   Net income before federal income















      tax expense

$

12,498


11,661


13,433


12,457


12,039


37,592


33,626

   Net income

$

10,123


9,446


10,881


7,979


8,337


30,450


23,295

   Basic earnings per share

$

0.61


0.57


0.66


0.48


0.51


1.83


1.41

   Diluted earnings per share

$

0.61


0.57


0.66


0.48


0.51


1.83


1.41

   Average basic shares outstanding


16,611,411


16,601,400


16,595,115


16,525,625


16,483,492


16,602,701


16,463,245

   Average diluted shares outstanding


16,619,295


16,610,819


16,604,325


16,536,225


16,494,540


16,610,544


16,474,534
















PERFORMANCE RATIOS















   Return on average assets


1.22%


1.17%


1.36%


0.97%


1.03%


1.25%


1.00%

   Return on average equity


10.64%


10.25%


12.07%


8.70%


9.21%


10.97%


8.87%

   Net interest margin (fully tax-equivalent)

3.87%


3.92%


4.06%


3.76%


3.83%


3.95%


3.80%

   Efficiency ratio


62.67%


63.40%


61.15%


60.32%


60.78%


62.40%


62.46%

   Full-time equivalent employees


637


667


640


641


634


637


634
















YIELD ON ASSETS / COST OF FUNDS















   Yield on loans


4.91%


4.92%


5.14%


4.76%


4.81%


4.99%


4.68%

   Yield on securities


2.70%


2.64%


2.61%


2.60%


2.50%


2.65%


2.43%

   Yield on other interest-earning assets


1.98%


1.80%


1.52%


1.29%


1.28%


1.73%


1.14%

   Yield on total earning assets


4.60%


4.60%


4.70%


4.35%


4.41%


4.63%


4.32%

   Yield on total assets


4.28%


4.27%


4.37%


4.04%


4.10%


4.31%


4.01%

   Cost of deposits


0.56%


0.53%


0.50%


0.45%


0.43%


0.53%


0.37%

   Cost of borrowed funds


2.14%


2.01%


1.83%


1.74%


1.75%


2.00%


1.66%

   Cost of interest-bearing liabilities


1.11%


1.02%


0.94%


0.88%


0.85%


1.02%


0.77%

   Cost of funds (total earning assets)


0.73%


0.68%


0.64%


0.59%


0.58%


0.68%


0.52%

   Cost of funds (total assets)


0.68%


0.63%


0.60%


0.55%


0.54%


0.64%


0.49%
















PURCHASE ACCOUNTING ADJUSTMENTS














   Loan portfolio - increase interest income

$

386


777


2,271


683


1,757


3,434


3,925

   Trust preferred - increase interest expense

$

171


171


171


171


171


513


513

   Core deposit intangible - increase overhead

$

477


530


556


556


556


1,563


1,801
















MORTGAGE BANKING ACTIVITY















   Total mortgage loans originated

$

66,829


62,032


40,937


62,526


61,962


169,798


160,698

   Purchase mortgage loans originated

$

47,704


41,239


25,137


33,958


41,254


114,080


101,892

   Refinance mortgage loans originated

$

19,125


20,793


15,800


28,568


20,708


55,718


58,806

   Total mortgage loans sold

$

30,713


24,114


19,813


26,254


33,858


74,640


81,692

   Net gain on sale of mortgage loans

$

1,116


851


729


1,051


1,131


2,696


2,875
















CAPITAL















   Tangible equity to tangible assets


9.98%


9.87%


9.63%


9.56%


9.54%


9.98%


9.54%

   Tier 1 leverage capital ratio


11.76%


11.81%


11.50%


11.24%


11.18%


11.76%


11.18%

   Common equity risk-based capital ratio


10.93%


11.03%


11.04%


10.71%


10.54%


10.93%


10.54%

   Tier 1 risk-based capital ratio


12.35%


12.49%


12.52%


12.19%


12.01%


12.35%


12.01%

   Total risk-based capital ratio


13.05%


13.19%


13.20%


12.85%


12.66%


13.05%


12.66%

   Tier 1 capital

$

382,829


375,167


367,546


359,047


354,087


382,829


354,087

   Tier 1 plus tier 2 capital

$

404,521


396,334


387,520


378,548


373,280


404,521


373,280

   Total risk-weighted assets

$

3,100,158


3,003,778


2,935,367


2,946,527


2,949,011


3,100,158


2,949,011

   Book value per common share

$

22.84


22.57


22.19


22.05


21.99


22.84


21.99

   Tangible book value per common share

$

19.50


19.20


18.79


18.61


18.49


19.50


18.49

   Cash dividend per common share

$

0.24


0.22


0.22


0.19


0.19


0.68


0.55
















ASSET QUALITY















   Gross loan charge-offs

$

169


273


654


920


709


1,096


2,315

   Recoveries

$

294


766


1,127


628


607


2,187


1,197

   Net loan charge-offs (recoveries)

$

(125)


(493)


(473)


292


102


(1,091)


1,118

   Net loan charge-offs to average loans


(0.02%)


(0.08%)


(0.08%)


0.05%


0.02%


(0.06%)


0.06%

   Allowance for loan losses

$

21,692


21,167


19,974


19,501


19,193


21,692


19,193

   Allowance to originated loans


0.88%


0.89%


0.87%


0.88%


0.88%


0.88%


0.88%

   Nonperforming loans

$

4,852


4,965


5,742


7,143


8,231


4,852


8,231

   Other real estate/repossessed assets

$

948


842


2,384


2,260


2,327


948


2,327

   Nonperforming loans to total loans


0.18%


0.19%


0.23%


0.28%


0.32%


0.18%


0.32%

   Nonperforming assets to total assets


0.18%


0.18%


0.25%


0.29%


0.32%


0.18%


0.32%
















NONPERFORMING ASSETS - COMPOSITION













   Residential real estate:















      Land development

$

0


0


0


0


0


0


0

      Construction

$

0


0


0


0


0


0


0

      Owner occupied / rental

$

3,908


3,650


3,571


3,574


3,648


3,908


3,648

   Commercial real estate:















      Land development

$

0


0


0


35


50


0


50

      Construction

$

0


0


0


0


0


0


0

      Owner occupied  

$

1,543


1,957


3,913


4,272


4,627


1,543


4,627

      Non-owner occupied

$

0


0


0


36


84


0


84

   Non-real estate:















      Commercial assets

$

331


180


620


1,444


2,126


331


2,126

      Consumer assets

$

18


20


22


42


23


18


23

   Total nonperforming assets


5,800


5,807


8,126


9,403


10,558


5,800


10,558
















NONPERFORMING ASSETS - RECON















   Beginning balance

$

5,807


8,126


9,403


10,558


7,239


9,403


6,408

   Additions - originated loans

$

999


300


1,426


402


4,789


2,725


9,550

   Merger-related activity

$

5


17


29


0


210


51


226

   Return to performing status

$

0


0


(175)


0


(120)


(175)


(233)

   Principal payments

$

(857)


(778)


(1,557)


(688)


(1,089)


(3,192)


(3,546)

   Sale proceeds

$

(147)


(1,807)


(299)


(101)


(373)


(2,253)


(576)

   Loan charge-offs

$

(3)


(50)


(597)


(754)


(91)


(650)


(1,179)

   Valuation write-downs

$

(4)


(1)


(104)


(14)


(7)


(109)


(92)

   Ending balance

$

5,800


5,807


8,126


9,403


10,558


5,800


10,558
















LOAN PORTFOLIO COMPOSITION















   Commercial:















      Commercial & industrial

$

818,113


776,995


739,805


753,764


776,562


818,113


776,562

      Land development & construction

$

39,396


37,868


31,437


29,872


28,575


39,396


28,575

      Owner occupied comm'l R/E

$

542,730


533,075


531,152


526,327


485,347


542,730


485,347

      Non-owner occupied comm'l R/E

$

811,767


818,376


794,206


791,685


805,167


811,767


805,167

      Multi-family & residential rental

$

94,101


95,656


96,428


101,918


119,170


94,101


119,170

         Total commercial

$

2,306,107


2,261,970


2,193,028


2,203,566


2,214,821


2,306,107


2,214,821

   Retail:















      1-4 family mortgages

$

301,765


283,657


264,996


254,560


236,075


301,765


236,075

      Home equity & other consumer

$

89,545


91,229


93,180


100,426


103,376


89,545


103,376

         Total retail

$

391,310


374,886


358,176


354,986


339,451


391,310


339,451

         Total loans

$

2,697,417


2,636,856


2,551,204


2,558,552


2,554,272


2,697,417


2,554,272
















END OF PERIOD BALANCES















   Loans

$

2,697,417


2,636,856


2,551,204


2,558,552


2,554,272


2,697,417


2,554,272

   Securities

$

337,603


342,178


348,024


346,780


341,126


337,603


341,126

   Other interest-earning assets

$

28,193


69,402


163,879


144,974


123,110


28,193


123,110

   Total earning assets (before allowance)

$

3,063,213


3,048,436


3,063,107


3,050,306


3,018,508


3,063,213


3,018,508

   Total assets

$

3,300,106


3,288,521


3,293,900


3,286,704


3,254,655


3,300,106


3,254,655

   Noninterest-bearing deposits

$

879,442


884,470


830,187


866,380


826,038


879,442


826,038

   Interest-bearing deposits

$

1,629,368


1,645,341


1,709,866


1,655,985


1,663,005


1,629,368


1,663,005

   Total deposits

$

2,508,810


2,529,811


2,540,053


2,522,365


2,489,043


2,508,810


2,489,043

   Total borrowed funds

$

401,575


373,642


373,824


387,468


390,868


401,575


390,868

   Total interest-bearing liabilities

$

2,030,943


2,018,983


2,083,690


2,043,453


2,053,873


2,030,943


2,053,873

   Shareholders' equity

$

379,465


374,919


368,340


365,870


362,546


379,465


362,546
















AVERAGE BALANCES















   Loans

$

2,658,092


2,596,828


2,552,070


2,534,729


2,534,364


2,602,718


2,466,156

   Securities

$

342,593


340,990


348,431


346,318


339,125


343,983


338,901

   Other interest-earning assets

$

61,810


63,336


123,633


138,095


116,851


82,700


75,029

   Total earning assets (before allowance)

$

3,062,495


3,001,154


3,024,134


3,019,142


2,990,340


3,029,401


2,880,086

   Total assets

$

3,295,129


3,232,038


3,249,794


3,248,828


3,220,053


3,259,153


3,106,899

   Noninterest-bearing deposits

$

893,181


848,650


805,214


849,751


805,650


849,337


785,940

   Interest-bearing deposits

$

1,628,346


1,635,755


1,690,135


1,635,727


1,648,235


1,651,186


1,574,293

   Total deposits

$

2,521,527


2,484,405


2,495,349


2,485,478


2,453,885


2,500,523


2,360,233

   Total borrowed funds

$

383,830


365,124


376,890


384,168


393,910


375,307


382,496

   Total interest-bearing liabilities

$

2,012,176


2,000,879


2,067,025


2,019,895


2,042,145


2,026,493


1,956,789

   Shareholders' equity

$

377,574


365,521


365,521


363,823


359,131


371,005


351,288

 

 

 

Cision View original content:http://www.prnewswire.com/news-releases/mercantile-bank-corporation-reports-strong-third-quarter-2018-results-300731380.html

SOURCE Mercantile Bank Corporation