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Mercantile Bank Corporation Reports Strong Third Quarter 2016 Results

Dienstag, 18.10.2016 12:05 von

PR Newswire

GRAND RAPIDS, Mich., Oct. 18, 2016 /PRNewswire/ -- Mercantile Bank Corporation (NASDAQ: MBWM) ("Mercantile") reported net income of $7.8 million, or $0.48 per diluted share, for the third quarter of 2016, compared with net income of $7.3 million, or $0.45 per diluted share, for the respective prior-year period.  Net income during the first nine months of 2016 totaled $23.8 million, or $1.46 per diluted share, compared to $20.5 million, or $1.23 per diluted share, during the first nine months of 2015.

The third quarter was highlighted by:

  • Robust earnings performance and strong capital position
  • Solid net interest margin
  • 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 $131 million
  • Sustained strength in commercial loan pipeline

"We are pleased to report another quarter of strong operating results, continuing the momentum generated during the first half of 2016," said Michael Price, Chairman, President and Chief Executive Officer of Mercantile.  "Our sound balance sheet and robust earnings performance have allowed us to take advantage of growth opportunities in our markets and have positioned us to meet future growth goals as well.  We are confident our year-to-date performance trends will continue through the fourth quarter, setting us up for a strong finish to 2016."

Operating Results

Total revenue, which consists of net interest income and noninterest income, was $31.7 million during the third quarter of 2016, up $1.8 million or 6.1 percent from the prior-year third quarter.  Net interest income during the third quarter of 2016 was $26.5 million, up $0.8 million or 3.2 percent from the third quarter of 2015, primarily reflecting an increase in earning assets.

The net interest margin was 3.76 percent in the third quarter of 2016, down from 3.87 percent in the prior-year third quarter mainly due to a decreased yield on loans, reflecting the ongoing low interest rate environment and competitive industry pressures.  The negative impact of the lower loan yield was partially offset by an increased yield on securities, resulting mainly from a significant level of accelerated discount accretion on called U.S. Government agency bonds, which was recorded as interest income.  The accelerated discount accretion totaled $0.4 million during the third quarter of 2016 and $2.2 million during the first nine months of 2016, positively impacting the net interest margin by six basis points and ten basis points in the respective periods.  No accelerated discount accretion was recorded during the third quarter of 2015, and only a nominal level was recorded during the first nine months of 2015.

The net interest margin has been relatively stable over the past nine quarters, ranging from 3.76 percent to 4.01 percent.  Mercantile's yield on loans has generally declined during this time period, consistent with the industry and primarily due to the ongoing low interest rate environment and competitive industry pressures.  In Mercantile's case, however, the negative impact of the lower loan yield has been largely offset by assets shifting out of the lower-yielding securities portfolio and into the higher-yielding loan portfolio. 

Net interest income and the net interest margin during the third quarter of 2016 and the prior-year third quarter were affected by purchase accounting accretion and amortization entries associated with the fair value measurements recorded effective June 1, 2014.  An increase in interest income on loans totaling $1.0 million and an increase in interest expense on subordinated debentures totaling $0.2 million were recorded during the third quarter of 2016.  An increase in interest income on loans totaling $1.4 million and a decrease in interest expense on deposits totaling $0.2 million were recorded during the third quarter of 2015.  In addition, an increase in interest expense on subordinated debentures totaling $0.2 million was recorded during the same time period.  Mercantile expects to continue to record adjustments in interest income on loans and interest expense on subordinated debentures in future periods; however, the adjustments to interest expense on deposits and FHLB advances ended in July and June of 2015, respectively.  The resulting increase in interest expense negatively impacted the net interest margin by approximately eight to ten basis points after July 31, 2015.

Mercantile recorded a $0.6 million provision for loan losses during the third quarter of 2016 compared to a negative $0.5 million provision during the respective 2015 period.  The provision expense recorded during the third quarter of 2016 primarily reflects ongoing loan growth, while the negative provision recorded during the prior-year third quarter resulted from multiple factors, including recoveries of previously charged-off loans, reversals of specific reserves, a reduced level of loan-rating downgrades and ongoing loan-rating upgrades.

Noninterest income during the third quarter of 2016 was $5.3 million, up $1.0 million or 23.5 percent from the $4.3 million in noninterest income recorded during the third quarter of 2015.  The increase in noninterest income mainly resulted from higher levels of service charges on accounts, in large part reflecting an ongoing project to ensure all depositors are in a product that best meets their needs and is priced appropriately as well as increased cash management fee income, and mortgage banking income, primarily reflecting the positive impact of recently-implemented strategic initiatives, including the hiring of additional loan originators, introduction of new and enhanced products, loan programs, and increased marketing efforts.

Noninterest expense totaled $19.7 million during both the third quarter of 2016 and the respective 2015 quarter.  Salary and benefit costs totaled $11.2 million during the current-year third quarter, up $0.4 million or 3.9 percent from the prior-year third quarter primarily due to increased health insurance and stock-based compensation expenses.  Nonperforming asset costs during the third quarter of 2016 were $0.2 million lower than the amount expensed during the respective 2015 period.

Mr. Price continued: "Our net interest margin remains strong and relatively stable, reflecting our focus on loan pricing discipline and sound asset quality, and our balance sheet structure continues to position our net interest income to benefit from any further interest rate hikes initiated by the Federal Open Market Committee.  We are pleased that recently implemented strategic initiatives, including the cost efficiency program, deposit account service charge review project, and revamping of mortgage banking activities, have positively impacted 2016 operating results in line with our expectations."  

Balance Sheet

As of September 30, 2016, total assets were $3.06 billion, up $160 million or 5.5 percent from December 31, 2015; total loans increased $129 million, or 5.6 percent, to $2.41 billion over the same time period, representing an annualized growth rate of approximately 8 percent.  During the twelve months ended September 30, 2016, total loans were up $189 million or about 9 percent.  Approximately $131 million in commercial term loans to new and existing borrowers were originated during the third quarter of 2016, as ongoing sales and relationship building efforts resulted in increased lending opportunities.  As of September 30, 2016, unfunded commitments on commercial construction and development loans totaled approximately $113 million, which are expected to be largely funded over the next twelve months.

Robert B. Kaminski, Jr., Executive Vice President and Chief Operating Officer of Mercantile, noted: "As expected, new commercial term loan originations remained strong during the third quarter of 2016, and based on our current loan pipeline, we are confident that the fourth quarter will reflect solid loan growth.  Although competitive pressures in our markets remain, our lending staff and other sales teams have emphasized our relationship -focused approach to banking and continued to develop new customer relationships.  While we remain pleased with the level of commercial term loan originations, we are also pleased to report increased mortgage banking activity during the quarter stemming from recently implemented strategic initiatives concentrated on increasing our market presence."

Commercial-related real estate loans continue to comprise a majority of Mercantile's loan portfolio, representing about 56 percent of total loans as of September 30, 2016.  Non-owner occupied commercial real estate ("CRE") loans and owner-occupied CRE loans equaled approximately 31 percent and 18 percent of total loans, respectively, as of September 30, 2016.  Commercial and industrial loans represented approximately 31 percent of total loans as of September 30, 2016. 

As of September 30, 2016, total deposits were $2.33 billion, up $54.1 million from December 31, 2015, and $75.3 million from September 30, 2015.   Local deposits were up $84.0 million since year-end 2015 and $106 million over the past twelve months; growth in local deposits was primarily driven by new commercial loan relationships.  Wholesale funds were $269 million, or approximately 10 percent of total funds, as of September 30, 2016, compared to $189 million, or approximately 8 percent of total funds, as of December 31, 2015, and $190 million, or approximately 8 percent of total funds, as of September 30, 2015.

Asset Quality

Nonperforming assets at September 30, 2016 were $5.5 million, compared to $6.0 million as of June 30, 2016, and $6.7 million as of December 31, 2015; at each period-end, nonperforming assets represented 0.2% of total assets.  The level of past due loans remains nominal, and the number and aggregate dollar amount of loan relationships on the internal watch list continue to decline.  Net loan charge-offs were $0.2 million during the third quarter of 2016 and $0.3 million in the linked quarter, compared to net loan recoveries of $0.1 million in the prior-year third quarter.

Capital Position

Shareholders' equity totaled $349 million as of September 30, 2016, an increase of $15.7 million from year-end 2015.  The Bank's capital position remains above "well-capitalized" with a total risk-based capital ratio of 13.1 percent as of September 30, 2016, compared to 13.5 percent at December 31, 2015.  At September 30, 2016, the Bank had approximately $84 million in excess of the 10.0 percent minimum regulatory threshold required to be considered a "well-capitalized" institution.  Mercantile reported 16,296,658 total shares outstanding at September 30, 2016.

As part of a $20 million common stock repurchase program announced in January of 2015, Mercantile repurchased approximately 168,000 shares for $3.7 million, or a weighted average all-in cost per share of $22.23, during the first nine months of 2016; since the program's inception, Mercantile has repurchased approximately 956,000 shares, or nearly 6 percent of total shares outstanding at year-end 2014, for $19.5 million, or a weighted average all-in cost per share of $20.38.  No shares were repurchased during the third quarter of 2016.  Future share repurchases totaling $15.5 million can be made under the program, which was expanded by $15 million earlier this year.

Although Mercantile has experienced solid loan growth, paid regular quarterly cash dividends equating to about 33 percent of net income, and repurchased approximately 956,000 shares for $19.5 million as part of the previously mentioned common stock repurchase program, it continues to operate with a significant level of excess regulatory capital, negatively impacting return on average equity.  Therefore, in addition to declaring a regular fourth quarter cash dividend of $0.17 per common share, Mercantile's Board of Directors also authorized the payment of a special cash dividend of $0.50 per common share.  Both the fourth quarter cash dividend and the special cash dividend are payable on December 21, 2016 to shareholders of record as of December 9, 2016.  Mercantile will rely on a cash dividend from the Bank to fund the special dividend.  Assuming the Bank paid the dividend to Mercantile on September 30, 2016, its pro forma total risk-based capital ratio as of that date was 12.8 percent compared to its actual ratio of 13.1 percent, and its total capital in excess of the 10.0 percent minimum regulatory threshold required to be considered a "well-capitalized" institution was approximately $76 million compared to the actual excess amount of $84 million.

Mr. Price concluded: "We are pleased to increase shareholder value through the payment of regular quarterly cash dividends resulting in competitive yields and to add the special cash dividend to be paid in the fourth quarter of 2016.  As reflected by loan and deposit growth and revenue enhancement, our ongoing efforts to identify and foster new customer relationships and efficiently deliver an extensive array of products and services have been very successful.  We are excited about Mercantile's future and expect the strong operating results achieved during the first nine months of 2016 to extend through the remainder of the year."

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 $3.1 billion and operates 48 banking offices serving communities in central and western Michigan.  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

CONSOLIDATED BALANCE SHEETS

(Unaudited)










SEPTEMBER 30,


DECEMBER 31,


SEPTEMBER 30,



2016


2015


2015

ASSETS







   Cash and due from banks

$

55,882,000

$

42,829,000

$

43,743,000

   Interest-earning deposits


85,848,000


46,463,000


49,952,000

   Federal funds sold


0


599,000


10,154,000

      Total cash and cash equivalents


141,730,000


89,891,000


103,849,000








   Securities available for sale


325,443,000


346,992,000


367,173,000

   Federal Home Loan Bank stock


8,026,000


7,567,000


7,567,000








   Loans


2,406,377,000


2,277,727,000


2,217,388,000

   Allowance for loan losses


(17,526,000)


(15,681,000)


(16,119,000)

      Loans, net


2,388,851,000


2,262,046,000


2,201,269,000








   Premises and equipment, net


45,212,000


46,862,000


47,509,000

   Bank owned life insurance


66,876,000


58,971,000


58,680,000

   Goodwill


49,473,000


49,473,000


49,473,000

   Core deposit intangible


10,592,000


12,631,000


13,346,000

   Other assets


27,761,000


29,123,000


32,511,000








      Total assets

$

3,063,964,000

$

2,903,556,000

$

2,881,377,000















LIABILITIES AND SHAREHOLDERS' EQUITY







   Deposits:







      Noninterest-bearing

$

731,663,000

$

674,568,000

$

619,125,000

      Interest-bearing


1,597,774,000


1,600,814,000


1,635,004,000

         Total deposits


2,329,437,000


2,275,382,000


2,254,129,000








   Securities sold under agreements to repurchase


146,843,000


154,771,000


158,149,000

   Federal Home Loan Bank advances


178,000,000


68,000,000


68,000,000

   Subordinated debentures


44,665,000


55,154,000


54,983,000

   Accrued interest and other liabilities


15,548,000


16,445,000


17,296,000

         Total liabilities


2,714,493,000


2,569,752,000


2,552,557,000








SHAREHOLDERS' EQUITY







   Common stock


304,027,000


304,819,000


304,378,000

   Retained earnings


43,655,000


27,722,000


23,673,000

   Accumulated other comprehensive income


1,789,000


1,263,000


769,000

      Total shareholders' equity


349,471,000


333,804,000


328,820,000








      Total liabilities and shareholders' equity

$

3,063,964,000

$

2,903,556,000

$

2,881,377,000

 

 

MERCANTILE BANK CORPORATION

CONSOLIDATED REPORTS OF INCOME

(Unaudited)
















THREE MONTHS ENDED


THREE MONTHS ENDED

NINE MONTHS ENDED

NINE MONTHS ENDED


September 30, 2016


September 30, 2015

September 30, 2016

September 30, 2015

INTEREST INCOME














   Loans, including fees

$

27,553,000



$

26,565,000


$

81,219,000


$

77,463,000


   Investment securities


2,033,000




1,894,000



7,283,000



6,128,000


   Other interest-earning assets


120,000




42,000



240,000



161,000


      Total interest income


29,706,000




28,501,000



88,742,000



83,752,000
















INTEREST EXPENSE














   Deposits


1,924,000




1,969,000



5,608,000



5,642,000


   Short-term borrowings


62,000




39,000



154,000



116,000


   Federal Home Loan Bank advances


670,000




203,000



1,595,000



506,000


   Other borrowed money


600,000




665,000



1,952,000



1,973,000


      Total interest expense


3,256,000




2,876,000



9,309,000



8,237,000
















      Net interest income


26,450,000




25,625,000



79,433,000



75,515,000
















Provision for loan losses


600,000




(500,000)



2,300,000



(1,500,000)
















      Net interest income after














         provision for loan losses


25,850,000




26,125,000



77,133,000



77,015,000
















NONINTEREST INCOME














   Service charges on accounts


1,140,000




862,000



3,178,000



2,444,000


   Credit and debit card income


1,090,000




1,005,000



3,185,000



3,296,000


   Mortgage banking income


1,236,000




1,073,000



2,578,000



2,784,000


   Earnings on bank owned life insurance


349,000




272,000



933,000



820,000


   Other income


1,469,000




1,065,000



6,560,000



2,648,000


      Total noninterest income


5,284,000




4,277,000



16,434,000



11,992,000
















NONINTEREST EXPENSE














   Salaries and benefits


11,162,000




10,745,000



32,959,000



31,903,000


   Occupancy


1,515,000




1,526,000



4,600,000



4,578,000


   Furniture and equipment


531,000




569,000



1,579,000



1,788,000


   Data processing costs


1,987,000




1,958,000



5,949,000



5,599,000


   FDIC insurance costs


351,000




355,000



1,108,000



1,315,000


   Other expense


4,117,000




4,540,000



12,530,000



14,101,000


      Total noninterest expense


19,663,000




19,693,000



58,725,000



59,284,000
















      Income before federal income














         tax expense


11,471,000




10,709,000



34,842,000



29,723,000
















Federal income tax expense


3,626,000




3,373,000



11,014,000



9,183,000
















      Net Income

$

7,845,000



$

7,336,000


$

23,828,000


$

20,540,000
















   Basic earnings per share


$0.48




$0.45



$1.46



$1.23


   Diluted earnings per share


$0.48




$0.45



$1.46



$1.23
















   Average basic shares outstanding


16,282,804




16,425,933



16,271,848



16,708,444


   Average diluted shares outstanding


16,307,350




16,461,794



16,294,093



16,743,625


 

MERCANTILE BANK CORPORATION

CONSOLIDATED FINANCIAL HIGHLIGHTS

(Unaudited)


















Quarterly


Year-To-Date

(dollars in thousands except per share data)

2016


2016


2016


2015


2015







3rd Qtr


2nd Qtr


1st Qtr


4th Qtr


3rd Qtr


2016


2015

EARNINGS















   Net interest income

$

26,450


27,100


25,882


25,659


25,625


79,433


75,515

   Provision for loan losses

$

600


1,100


600


500


(500)


2,300


(1,500)

   Noninterest income

$

5,284


4,064


7,086


4,046


4,277


16,434


11,992

   Noninterest expense

$

19,663


19,193


19,868


20,097


19,693


58,725


59,284

   Net income before federal income















      tax expense

$

11,471


10,871


12,500


9,108


10,709


34,842


29,723

   Net income

$

7,845


7,434


8,549


6,480


7,336


23,828


20,540

   Basic earnings per share

$

0.48


0.46


0.52


0.40


0.45


1.46


1.23

   Diluted earnings per share

$

0.48


0.46


0.52


0.40


0.45


1.46


1.23

   Average basic shares outstanding


16,282,804


16,240,966


16,291,654


16,314,953


16,425,933


16,271,848


16,708,444

   Average diluted shares outstanding


16,307,350


16,268,839


16,325,475


16,352,187


16,461,794


16,294,093


16,743,625
















PERFORMANCE RATIOS















   Return on average assets


1.02%


1.01%


1.19%


0.88%


1.01%


1.07%


0.96%

   Return on average equity


9.00%


8.79%


10.18%


7.79%


8.86%


9.32%


8.33%

   Net interest margin (fully tax-equivalent)

3.76%


4.01%


3.92%


3.81%


3.87%


3.89%


3.84%

   Efficiency ratio


61.96%


61.59%


60.26%


67.66%


65.86%


61.26%


67.75%

   Full-time equivalent employees


612


633


612


639


640


612


640
















YIELD ON ASSETS / COST OF FUNDS















   Yield on loans


4.57%


4.60%


4.72%


4.71%


4.79%


4.63%


4.80%

   Yield on securities


2.71%


3.99%


2.52%


2.21%


2.16%


3.07%


2.16%

   Yield on other interest-earning assets


0.51%


0.51%


0.54%


0.25%


0.25%


0.52%


0.25%

   Yield on total earning assets


4.22%


4.45%


4.37%


4.25%


4.30%


4.34%


4.26%

   Yield on total assets


3.90%


4.12%


4.03%


3.91%


3.95%


4.02%


3.92%

   Cost of deposits


0.33%


0.32%


0.33%


0.34%


0.34%


0.33%


0.33%

   Cost of borrowed funds


1.41%


1.42%


1.53%


1.39%


1.37%


1.45%


1.36%

   Cost of interest-bearing liabilities


0.66%


0.64%


0.64%


0.61%


0.60%


0.65%


0.57%

   Cost of funds (total earning assets)


0.46%


0.44%


0.45%


0.44%


0.43%


0.45%


0.42%

   Cost of funds (total assets)


0.42%


0.41%


0.42%


0.40%


0.40%


0.42%


0.38%
















PURCHASE ACCOUNTING ADJUSTMENTS














   Loan portfolio - increase interest income

$

1,002


935


1,316


1,074


1,354


3,253


4,264

   Time deposits - reduce interest expense

$

0


0


0


0


196


0


1,371

   FHLB advances - reduce interest expense

$

0


0


0


0


0


0


22

   Trust preferred - increase interest expense

$

171


171


171


171


171


513


513

   Core deposit intangible - increase overhead

$

636


688


715


715


715


2,039


2,277
















CAPITAL















   Tangible equity to tangible assets


9.63%


9.66%


9.68%


9.56%


9.44%


9.63%


9.44%

   Tier 1 leverage capital ratio


11.28%


11.41%


11.43%


11.56%


11.52%


11.28%


11.52%

   Common equity risk-based capital ratio


10.83%


10.73%


10.86%


10.89%


10.95%


10.83%


10.95%

   Tier 1 risk-based capital ratio


12.40%


12.31%


12.49%


12.83%


12.94%


12.40%


12.94%

   Total risk-based capital ratio


13.05%


12.95%


13.12%


13.45%


13.58%


13.05%


13.58%

   Tier 1 capital

$

337,054


330,710


324,296


329,858


324,911


337,054


324,911

   Tier 1 plus tier 2 capital

$

354,580


347,819


340,557


345,539


341,029


354,580


341,029

   Total risk-weighted assets

$

2,718,012


2,685,823


2,596,517


2,570,015


2,511,174


2,718,012


2,511,174

   Book value per common share

$

21.44


21.18


20.86


20.41


20.20


21.44


20.20

   Tangible book value per common share

$

17.76


17.45


17.07


16.61


16.34


17.76


16.34

   Cash dividend per common share

$

0.17


0.16


0.16


0.15


0.15


0.49


0.43
















ASSET QUALITY















   Gross loan charge-offs

$

363


397


475


1,266


182


1,235


5,013

   Recoveries

$

179


145


456


328


239


780


2,591

   Net loan charge-offs (recoveries)

$

184


252


19


938


(57)


455


2,422

   Net loan charge-offs to average loans


0.03%


0.04%


< 0.01%


0.17%


(0.01%)


0.03%


0.15%

   Allowance for loan losses

$

17,526


17,110


16,262


15,681


16,119


17,526


16,119

   Allowance to originated loans


0.93%


0.94%


0.94%


0.94%


1.04%


0.93%


1.04%

   Nonperforming loans

$

4,669


5,168


4,842


5,444


8,214


4,669


8,214

   Other real estate/repossessed assets

$

790


815


1,478


1,293


2,272


790


2,272

   Nonperforming loans to total loans


0.19%


0.22%


0.21%


0.24%


0.37%


0.19%


0.37%

   Nonperforming assets to total assets


0.18%


0.20%


0.22%


0.23%


0.36%


0.18%


0.36%
















NONPERFORMING ASSETS - COMPOSITION













   Residential real estate:















      Land development

$

23


42


30


23


378


23


378

      Construction

$

0


319


0


0


0


0


0

      Owner occupied / rental

$

2,945


2,893


2,955


3,515


3,714


2,945


3,714

   Commercial real estate:















      Land development

$

110


125


140


155


170


110


170

      Construction

$

0


0


0


0


0


0


0

      Owner occupied  

$

1,597


2,263


2,877


2,743


2,741


1,597


2,741

      Non-owner occupied

$

691


134


151


191


3,193


691


3,193

   Non-real estate:















      Commercial assets

$

65


165


137


69


271


65


271

      Consumer assets

$

28


42


30


41


19


28


19

   Total nonperforming assets


5,459


5,983


6,320


6,737


10,486


5,459


10,486
















NONPERFORMING ASSETS - RECON















   Beginning balance

$

5,983


6,320


6,737


10,486


10,136


6,737


31,429

   Additions - originated loans

$

1,172


1,096


1,123


927


1,161


3,391


4,717

   Merger-related activity

$

0


0


0


656


163


0


434

   Return to performing status

$

0


0


0


(48)


0


0


(5)

   Principal payments

$

(1,509)


(495)


(774)


(3,457)


(567)


(2,778)


(20,184)

   Sale proceeds

$

(76)


(642)


(402)


(1,300)


(319)


(1,120)


(1,077)

   Loan charge-offs

$

(101)


(261)


(356)


(172)


(65)


(718)


(4,672)

   Valuation write-downs

$

(10)


(35)


(8)


(355)


(23)


(53)


(156)

   Ending balance

$

5,459


5,983


6,320


6,737


10,486


5,459


10,486
















LOAN PORTFOLIO COMPOSITION















   Commercial:















      Commercial & industrial

$

750,330


750,136


714,612


696,303


643,118


750,330


643,118

      Land development & construction

$

37,455


40,529


39,630


45,120


47,734


37,455


47,734

      Owner occupied comm'l R/E

$

440,705


438,798


441,662


445,919


427,016


440,705


427,016

      Non-owner occupied comm'l R/E

$

741,443


716,930


666,013


644,351


636,227


741,443


636,227

      Multi-family & residential rental

$

118,103


113,361


112,533


115,003


123,525


118,103


123,525

         Total commercial

$

2,088,036


2,059,754


1,974,450


1,946,696


1,877,620


2,088,036


1,877,620

   Retail:















      1-4 family mortgages

$

190,715


189,119


185,535


190,385


193,003


190,715


146,765

      Home equity & other consumer

$

127,626


131,067


135,683


140,646


146,765


127,626


193,003

         Total retail

$

318,341


320,186


321,218


331,031


339,768


318,341


339,768

         Total loans

$

2,406,377


2,379,940


2,295,668


2,277,727


2,217,388


2,406,377


2,217,388
















END OF PERIOD BALANCES















   Loans

$

2,406,377


2,379,940


2,295,668


2,277,727


2,217,388


2,406,377


2,217,388

   Securities

$

333,469


331,478


351,372


354,559


374,740


333,469


374,740

   Other interest-earning assets

$

85,848


46,896


62,814


47,062


60,106


85,848


60,106

   Total earning assets (before allowance)

$

2,825,694


2,758,314


2,709,854


2,679,348


2,652,234


2,825,694


2,652,234

   Total assets

$

3,063,964


2,999,936


2,926,056


2,903,556


2,881,377


3,063,964


2,881,377

   Noninterest-bearing deposits

$

731,663


733,573


678,100


674,568


619,125


731,663


619,125

   Interest-bearing deposits

$

1,597,774


1,546,145


1,587,022


1,600,814


1,635,004


1,597,774


1,635,004

   Total deposits

$

2,329,437


2,279,718


2,265,122


2,275,382


2,254,129


2,329,437


2,254,129

   Total borrowed funds

$

372,917


362,665


308,148


281,830


284,919


372,917


284,919

   Total interest-bearing liabilities

$

1,970,691


1,908,810


1,895,170


1,882,644


1,919,923


1,970,691


1,919,923

   Shareholders' equity

$

349,471


344,577


338,553


333,804


328,820


349,471


328,820
















AVERAGE BALANCES















   Loans

$

2,391,620


2,342,333


2,273,960


2,243,856


2,201,124


2,336,174


2,156,175

   Securities

$

328,993


340,866


354,499


362,390


378,286


341,407


407,431

   Other interest-earning assets

$

91,590


49,365


42,008


75,111


64,027


61,100


80,248

   Total earning assets (before allowance)

$

2,812,203


2,732,564


2,670,467


2,681,357


2,643,437


2,738,681


2,643,854

   Total assets

$

3,040,324


2,952,184


2,892,229


2,909,210


2,876,671


2,961,866


2,872,157

   Noninterest-bearing deposits

$

733,600


702,293


652,338


656,475


620,189


696,214


589,993

   Interest-bearing deposits

$

1,572,424


1,548,509


1,588,930


1,631,218


1,653,441


1,569,963


1,685,930

   Total deposits

$

2,306,024


2,250,802


2,241,268


2,287,693


2,273,630


2,266,177


2,275,923

   Total borrowed funds

$

373,973


347,191


299,956


276,585


263,264


340,496


255,602

   Total interest-bearing liabilities

$

1,946,397


1,895,700


1,888,886


1,907,803


1,916,705


1,910,459


1,941,532

   Shareholders' equity

$

345,944


339,357


336,870


330,032


328,332


340,742


329,704

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/mercantile-bank-corporation-reports-strong-third-quarter-2016-results-300346235.html

SOURCE Mercantile Bank Corporation