US Market News
2 months ago
Mercantile Bank Corporation Announces Solid First Quarter 2026 ResultsApril 21, 2026 5:05 AM
PR Newswire (US)
Growth in net interest income and key fee income categories with ongoing strength in asset quality measures and capital levels highlight the quarterGRAND RAPIDS, Mich., April 21, 2026 /PRNewswire/ -- Mercantile Bank Corporation (NASDAQ: MBWM) ("Mercantile") reported net income of $22.7 million, or $1.32 per diluted share, for the first quarter of 2026, compared with net income of $19.5 million, or $1.21 per diluted share, for the respective prior-year period.
Excluding after-tax one-time costs associated with the year-end 2025 acquisition of Eastern Michigan Financial Corporation and previously announced core and digital banking system conversion (a non-GAAP measurement), net income improved to $25.2 million, or $1.46 per diluted share, for the first quarter of 2026. Earnings per diluted share increased $0.25, or approximately 21 percent, in the first quarter of 2026 compared to the first quarter of 2025 using this non-GAAP basis."Our financial performance remained strong during the first quarter of 2026, further demonstrating our ability to effectively administer the prolonged period of global economic uncertainty and increasing geopolitical tensions," said Ray Reitsma, President and Chief Executive Officer of Mercantile. "The solid operating results reflected increased net interest income, an improved net interest margin, strong growth in treasury management fees, interest rate swap income, mortgage banking income, and payroll services fees, a negative provision for credit losses, robust local deposit growth, and sustained strength in asset quality and capital measures. The strong net growth in local deposits, which occurred despite the typical level of seasonal deposit withdrawals, provided for a further reduction in our loan-to-deposit ratio. The first quarter of 2026 represented the initial period of financial performance that included Eastern Michigan Bank's operating results."First quarter highlights include:Return on average assets of 1.4 percent and return on average equity of 12.5 percent, and 1.5 percent and 14.0 percent, respectively, on a non-GAAP basisTangible book value per common share of $37.34 as of March 31, 2026, up $0.56, or approximately 2 percent, since December 31, 2025, and $2.92, or over 8 percent, since March 31, 2025Net revenue expansion of over 18 percent compared to the prior-year first quarter, including net interest income growth of over 15 percentIncreased net interest margin primarily reflecting lower cost of funds and continued repricing of matured fixed rate loans and securitiesNotable increases in treasury management fees, mortgage banking income, and payroll services fees of approximately 26 percent, 12 percent, and 5 percent, respectivelyDecline in effective tax rate from approximately 19 percent during the first quarter of 2025 to 17 percent during the first quarter of 2026 largely due to an increase in aggregate tax benefits derived from the acquisition of transferable energy tax credits and net benefits from low-income housing and historical tax credit investmentsContinued strength in commercial loan pipelineSustained low levels of nonperforming assets, past due loans, and loan charge-offsNotable reduction in loan-to-deposit ratio from approximately 99 percent as of March 31, 2025, and 91 percent as of December 31, 2025, to approximately 89 percent as of March 31, 2026, mainly reflecting robust local deposit growthStrong tangible and regulatory capital positionsOperating ResultsNet revenue, consisting of net interest income and noninterest income, was $67.6 million during the first quarter of 2026, up $10.3 million, or 18.1 percent, from $57.3 million during the prior-year first quarter. Net interest income during the first three months of 2026 was $55.9 million, up $7.4 million, or 15.1 percent, from $48.5 million during the respective 2025 period primarily due to growth in earning assets and a slightly higher net interest margin. Eastern Michigan Bank's net interest income totaled $5.9 million during the first quarter of 2026. Noninterest income totaled $11.7 million during the current-year first quarter, up $3.0 million, or 34.3 percent, from $8.7 million during the first quarter of 2025. The increase in noninterest income mainly reflected higher levels of treasury management fees, interest rate swap income, and mortgage banking income. Eastern Michigan Bank generated $0.5 million in noninterest income during the first three months of 2026, largely reflecting treasury management fees.The net interest margin was 3.55 percent in the first quarter of 2026, up from 3.47 percent in the prior-year first quarter. The yield on average earning assets was 5.42 percent during the first three months of 2026, a decrease from 5.73 percent during the respective 2025 period. The lower yield mainly stemmed from a reduced yield on loans and a change in earning asset mix, which more than offset an improved yield on securities resulting from the reinvestment of relatively low-yielding bonds and portfolio expansion activities, along with the positive impact resulting from the addition of Eastern Michigan Bank's securities portfolio. The yield on loans was 6.04 percent during the first quarter of 2026, down from 6.28 percent during the first quarter of 2025, primarily due to reduced interest rates on variable-rate commercial loans resulting from the Federal Open Market Committee ("FOMC") lowering the targeted federal funds rate. The FOMC decreased the targeted federal funds rate by 25 basis points in each of September, October, and December of 2025, during which time average variable-rate commercial loans represented approximately 77 percent of average total commercial loans. Denoting the success of a strategic initiative to lower the loan-to-deposit ratio and increase on-balance sheet liquidity and reflecting the impact of Eastern Michigan Bank's liquid balance sheet, higher-yielding loans represented a decreased percentage of earning assets and lower-yielding securities accounted for an increased percentage of earning assets in the first quarter of 2026 compared to the first quarter of 2025. The yield on securities equaled 3.27 percent during the first quarter of 2026, up from 2.73 percent during the prior-year first quarter. The yield on other interest-earning assets, largely consisting of funds on deposit with the Federal Reserve Bank of Chicago, declined from 4.80 percent during the first three months of 2025 to 4.00 percent during the respective 2026 period, reflecting the decreased interest rate environment.During the first quarter of 2026, the cost of funds was 1.87 percent, down from 2.26 percent during the first quarter of 2025, mainly due to lower rates paid on money market accounts and time deposits, reflecting the decreased interest rate environment. An increase in low-cost deposit products as a percentage of total funding sources, primarily stemming from the onboarding of Eastern Michigan Bank's deposit base, also contributed to the reduced cost of funds.Mercantile recorded a negative provision for credit losses of $1.8 million during the first quarter of 2026, compared to a positive provision for credit losses of $2.1 million during the first quarter of 2025. The negative provision expense recorded during the current-year first quarter mainly reflected improvements to the economic forecast, changes in loan mix, decreases to the residential mortgage loan portfolio, and a decline in specific allocations, which reduced the calculated allowance for credit losses by $0.6 million, $0.4 million, $0.2 million, and $0.2 million, respectively.Noninterest income totaled $11.7 million during the first quarter of 2026, up $3.0 million, or 34.3 percent, from $8.7 million during the prior-year first quarter. The increase mainly reflected higher levels of treasury management fees, interest rate swap income, mortgage banking income, bank owned life insurance income, and payroll services fees. The increases in treasury management and payroll services fees primarily resulted from new commercial client acquisitions and effective marketing endeavors leading to customers' amplified use of products and services, as well as a modified fee schedule. The growth in interest rate swap income mainly reflected a higher volume of new swap transactions, while the increase in mortgage banking income largely resulted from higher production and an increased percentage of loans originated with the intent to sell. Noninterest income during the first three months of 2026 included $0.4 million in interest from the Internal Revenue Service on federal income tax payments made during 2024 that were subsequently refunded due to offsetting purchased energy tax credits. Noninterest expense totaled $42.1 million during the first quarter of 2026, compared to $31.1 million during the first quarter of 2025. Excluding one-time costs aggregating $2.9 million related to the core and digital banking system conversion and $0.3 million associated with the acquisition of Eastern Michigan Financial Corporation, noninterest expense increased $7.8 million, or 25.0 percent, during the first three months of 2026 compared to the respective 2025 period. The increase in noninterest expense mainly resulted from higher salary and benefit costs. A $1.2 million increase in allocations to the reserve for unfunded loan commitments, largely reflecting a significantly higher level of commercial loan commitments that have been accepted by customers, also contributed to the increase in noninterest expense. The remaining increase in noninterest expense largely reflects cost inflation and the increased cost of a larger balance sheet and branch network. Eastern Michigan Bank's noninterest expense totaled $4.0 million during the first three months of 2026, including salary and benefit costs of $1.7 million, core deposit intangible asset amortization of $0.9 million, and data processing costs of $0.4 million.Federal income tax expense was $4.6 million during the first quarter of 2026, compared to $4.5 million during the respective 2025 period. The $0.1 million increase in federal income tax expense primarily resulted from a higher level of income before federal income tax. The acquisition of transferable energy tax credits and the net benefits from low-income housing and historic tax credit investments provided for aggregate tax benefits of $0.8 million and $0.3 million during the first three months of 2026 and 2025, respectively. The recording of the tax benefits positively impacted Mercantile's effective tax rate, which equaled 16.9 percent during the first quarter of 2026, down from 18.8 percent during the prior-year first quarter. Mr. Reitsma commented, "The notable increase in net interest income during the first quarter of 2026 reflected solid earning asset growth and a lower cost of funds. Our net interest margin, which remained healthy during the quarter, has been relatively steady over the past seven quarters despite a declining interest rate environment, reflecting the success of interest rate risk mitigation strategies employed to achieve an interest rate agnostic position. We are very pleased with the higher levels of treasury management fees, interest rate swap income, mortgage banking income, and payroll services fees, and will continue our efforts to expand existing customers' relationships and gain new client relationships to enhance noninterest income revenue streams. Growing our balance sheet in a cost-conscious manner while continuing to provide our customers with outstanding service and market-leading products and services to meet their needs remain important strategic objectives. Excluding costs related to the core and digital banking system conversion and acquisition of Eastern Michigan Financial Corporation, overhead costs as a percentage of net revenue during the first quarter of 2026 increased only slightly compared to the first quarter of 2025."Balance SheetTotal assets were $6.95 billion as of March 31, 2026, up $110 million from December 31, 2025. Total loans decreased $5.2 million, or 0.1 percent, during the first quarter of 2026, reflecting a net decline in residential mortgage loans, which more than offset net growth in both commercial loans and other consumer loans. Commercial loans grew $16.7 million, or an annualized 1.7 percent, during the first three months of 2026, despite the full payoffs and partial paydowns of certain larger relationships, which aggregated $180 million during the period and were significantly higher than the historical average of approximately $50 million per quarter. The payoffs and paydowns mainly stemmed from sales of assets, secondary market refinancings, and customers using excess cash flows generated within their operations to make line of credit reductions. Payoffs and paydowns during 2025 were also well above historical levels, totaling approximately $363 million and averaging about $91 million per quarter. Commercial loan originations, consisting of loans to new clients and expansions of existing credit relationships, remained solid across all segments during the first quarter of 2026. During the first three months of 2026, residential mortgage loans were down $22.6 million, while other consumer loans increased $0.7 million. Interest-earning deposits and securities available for sale were up $112 million and $23.2 million, respectively, during the first quarter of 2026. As of March 31, 2026, unfunded commitments on commercial construction and development loans, which are expected to be funded over the next 12 to 18 months, and residential construction loans, which are expected to be largely funded over the next 12 months, totaled $240 million and $32 million, respectively.Commercial and industrial loans and owner-occupied commercial real estate loans together represented approximately 57 percent of total commercial loans as of March 31, 2026, a level that has remained relatively consistent with prior periods and in line with our expectations.Total deposits equaled $5.42 billion as of March 31, 2026, compared to $5.28 billion as of December 31, 2025. Local deposits grew $185 million, or an annualized 14.6 percent, during the first quarter of 2026, while brokered deposits decreased $50.4 million. The increase in local deposits, which occurred despite the customary level of seasonal noninterest-bearing deposit withdrawals by customers to make bonus and tax payments and partnership distributions, reflected successful customer acquisition efforts and net growth in various existing deposit relationships. The loan-to-deposit ratio equaled 89 percent as of March 31, 2026, down from 91 percent as of year-end 2025 and 99 percent as of March 31, 2025, largely reflecting increases in local deposits. As of March 31, 2026, wholesale funds were $395 million, or approximately 7 percent of total funds, compared to about 8 percent and 10 percent as of December 31, 2025, and March 31, 2025, respectively. Noninterest-bearing checking accounts represented approximately 25 percent of total deposits as of March 31, 2026.Mr. Reitsma noted, "The commercial loan portfolio expanded during the first quarter of 2026 despite elevated levels of payoffs and line of credit paydowns, reflecting sustained strength in loan originations. We expect payoffs and paydowns to revert to historical levels during the remainder of 2026. Based on our current pipeline and continuing discussions with existing and prospective borrowers, we believe plentiful opportunities to book commercial loans will exist in future periods. We are pleased with the notable growth in local deposits and the associated decline in our loan-to-deposit ratio during the current-year first quarter, and we will continue our efforts to fund loan originations and investment purchases through local deposit expansion."Asset QualityNonperforming assets totaled $7.5 million, or 0.1 percent of total assets, as of March 31, 2026, compared to $7.9 million, or 0.1 percent of total assets, as of December 31, 2025, and $5.4 million, or less than 0.1 percent of total assets, as of March 31, 2025. The level of past due loans remains minimal. During the first quarter of 2026, loan charge-offs were nominal, while recoveries of prior period loan charge-offs equaled $0.4 million, providing for net loan recoveries of $0.3 million, or an annualized 0.03 percent of average total loans.Mr. Reitsma remarked, "Our asset quality measures remained strong during the first quarter of 2026 as evidenced by ongoing low levels of nonperforming assets, past due loans, and loan charge-offs. We remain focused on underwriting loans across all portfolio segments in a sound and disciplined manner and detecting any weakening credit relationships and evolving systemic or sector-specific credit issues as soon as possible to minimize the impact of such on our overall financial position. Our borrowers have continued to operate effectively during the prolonged and continuing period of uncertain macro-economic conditions and heightened geopolitical concerns."Capital Position Shareholders' equity totaled $737 million as of March 31, 2026, up $12.1 million from December 31, 2025. Mercantile Bank and Eastern Michigan Bank maintained "well-capitalized" positions as of March 31, 2026, with total risk-based capital ratios of 13.8 percent and 21.5 percent, respectively. As of March 31, 2026, Mercantile Bank and Eastern Michigan Bank had approximately $215 million and $29.6 million, respectively, in excess of the 10 percent minimum regulatory threshold required to be categorized as a "well-capitalized" institution.Mercantile reported 17,274,356 total shares outstanding as of March 31, 2026.Mr. Reitsma concluded, "Our sustained financial strength allowed us to continue our regular cash dividend program and once again provide shareholders with meaningful cash returns on their investments. We believe we are well positioned to effectively address any issues emerging from the ongoing uncertainty surrounding macro-economic and operating conditions as a result of continuing strength in our operating results, asset quality metrics, and capital measures, along with the attainment of solid financial performance in future periods as anticipated. Our unwavering commitment to meet clients' needs has proven to be successful in retaining existing and securing new relationships, and we believe the continuation of these efforts will afford us with plentiful opportunities to originate loans and generate local deposits in future periods." Investor PresentationMercantile has prepared presentation materials that management intends to use during its previously announced first quarter 2026 conference call on Tuesday, April 21, 2026, at 10:00 a.m. Eastern Time, and from time to time thereafter in presentations about the company's operations and performance. These materials, which are available for viewing in the Investor Relations section of Mercantile's website at www.mercbank.com, have been furnished to the U.S. Securities and Exchange Commission concurrently with this press release.About Mercantile Bank CorporationBased in Grand Rapids, Michigan, Mercantile Bank Corporation is the bank holding company for Mercantile Bank and Eastern Michigan Bank. Mercantile Bank and Eastern Michigan Bank provide financial products and services in a professional and personalized manner designed to make banking easier for businesses, individuals, and governmental units. Distinguished by exceptional service, knowledgeable staff, and a commitment to the communities they serve, Mercantile Bank and Eastern Michigan Bank together comprise one of the largest Michigan-based banking organizations with total combined assets of approximately $6.9 billion. Mercantile Bank Corporation's common stock is listed on the NASDAQ Global Select Market under the symbol "MBWM." For more information about Mercantile, visit www.mercbank.com, and follow us on Facebook, Instagram, X (formerly Twitter) @MercBank, and LinkedIn @merc-bank.Reconciliation of U.S. GAAP to Non-GAAP Financial MeasuresThis news release contains certain non-GAAP financial measures, including adjusted net income and adjusted diluted earnings per share, each of which excludes after-tax costs associated with (i) Mercantile's acquisition of Eastern Michigan Financial Corporation that was completed during the fourth quarter of 2025 ($0.2 million), and (ii) the previously announced core and digital bank system conversion ($2.3 million). These non-GAAP financial measures are identified in this news release where they appear. We believe that presenting these non-GAAP financial measures provides investors, analysts, and other interested parties with meaningful supplementary information to assess Mercantile's underlying operational performance by removing the effect of costs we consider to be non-recurring in nature and not reflective of Mercantile's core operating results. These non-GAAP financial measures are used by management to evaluate Mercantile's ongoing operations, for internal planning and forecasting purposes, and to assess period-over-period comparability. Management believes it is useful for the reader to review these non-GAAP adjusted measures alongside the GAAP measures. Our definition of these adjusted financial measures may differ from similarly named measures used by others. These non-GAAP measures have limitations as an analytical tool and should not be considered in isolation or as a substitute for our GAAP measures. Our net income and diluted earnings per share are presented on a GAAP-basis in the first paragraph of this release.Forward-Looking StatementsThis news release contains statements or information that may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: "anticipate," "intend," "plan," "goal," "seek," "believe," "project," "estimate," "expect," "strategy," "future," "likely," "may," "should," "will," and similar references to future periods. Any such statements are based on current expectations that involve a number of risks and uncertainties. Actual results may differ materially from the results expressed in forward-looking statements. Factors that might cause such a difference include difficulties and delays in the integration of Mercantile Bank and Eastern Michigan Bank and achieving anticipated synergies, cost savings and other benefits from the transaction; changes in interest rates and interest rate relationships; increasing rates of inflation and slower growth rates or recession; significant declines in the value of commercial real estate; market volatility; demand for products and services; climate impacts; labor markets; the degree of competition by traditional and nontraditional financial services companies; changes in banking regulation or actions by bank regulators; changes in tax laws and other laws and regulations applicable to us; changes in prices, levies, and assessments; the impact of technological advances; potential cyber-attacks, information security breaches and other criminal activities; litigation liabilities; governmental and regulatory policy changes; the outcomes of existing or future contingencies; trends in customer behavior as well as their ability to repay loans; changes in local real estate values; damage to our reputation resulting from adverse publicity, regulatory actions, litigation, operational failures, and the failure to meet client expectations and other facts; changes in the national and local economies; unstable political and economic environments; disease outbreaks, such as the COVID-19 pandemic or similar public health threats, and measures implemented to combat them; and other factors, including those expressed as risk factors, disclosed from time to time in filings made by Mercantile with the Securities and Exchange Commission. Mercantile undertakes no obligation to update or clarify forward-looking statements, whether as a result of new information, future events or otherwise. Investors are cautioned not to place undue reliance on any forward-looking statements contained herein.MERCANTILE BANK CORPORATIONCONSOLIDATED BALANCE SHEETS(Unaudited)
MARCH 31,
DECEMBER 31,
MARCH 31,
2026
2025
2025
ASSETS
Cash and due from banks$48,431,000$54,755,000$70,320,000 Interest-earning deposits and Federal Funds sold
530,873,000
418,569,000
315,140,000 Total cash and cash equivalents
579,304,000
473,324,000
385,460,000
Securities available for sale
1,125,433,000
1,102,230,000
787,583,000 Mortgage loans held for sale
21,748,000
17,160,000
15,192,000
Loans
4,816,693,000
4,821,888,000
4,636,549,000 Allowance for credit losses
(56,736,000)
(58,191,000)
(56,666,000) Loans, net
4,759,957,000
4,763,697,000
4,579,883,000
Premises and equipment, net
61,861,000
62,468,000
53,693,000 Bank owned life insurance
105,862,000
105,342,000
94,417,000 Goodwill
73,689,000
72,656,000
49,473,000 Core deposit intangible asset, net
18,173,000
20,388,000
0 Other assets
199,008,000
217,954,000
175,499,000
Total assets$6,945,035,000$6,835,219,000$6,141,200,000
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Noninterest-bearing$1,331,947,000$1,339,666,000$1,173,499,000 Interest-bearing
4,087,571,000
3,944,786,000
3,508,286,000 Total deposits
5,419,518,000
5,284,452,000
4,681,785,000
Securities sold under agreements to repurchase
219,513,000
232,291,000
242,102,000 Federal Home Loan Bank advances
315,322,000
326,221,000
366,221,000 Subordinated debentures
51,186,000
51,015,000
50,501,000 Subordinated notes
89,743,000
89,657,000
89,400,000 Term note
27,500,000
30,000,000
0 Accrued interest and other liabilities
85,306,000
96,699,000
102,845,000 Total liabilities
6,208,088,000
6,110,335,000
5,532,854,000
SHAREHOLDERS' EQUITY
Common stock
350,645,000
349,431,000
300,732,000 Retained earnings
415,499,000
399,448,000
348,281,000 Accumulated other comprehensive income/(loss)
(29,197,000)
(23,995,000)
(40,667,000) Total shareholders' equity
736,947,000
724,884,000
608,346,000
Total liabilities and shareholders' equity$6,945,035,000$6,835,219,000$6,141,200,000
MERCANTILE BANK CORPORATIONCONSOLIDATED REPORTS OF INCOME(Unaudited)
THREE MONTHS ENDED
THREE MONTHS ENDED
March 31, 2026
March 31, 2025
INTEREST INCOME
Loans, including fees
$71,897,000
$71,730,000 Investment securities
8,849,000
4,957,000 Other interest-earning assets
4,680,000
3,651,000 Total interest income
85,426,000
80,338,000
INTEREST EXPENSE
Deposits
23,247,000
25,192,000 Short-term borrowings
1,479,000
1,763,000 Federal Home Loan Bank advances
2,556,000
2,898,000 Other borrowed money
2,243,000
1,937,000 Total interest expense
29,525,000
31,790,000
Net interest income
55,901,000
48,548,000
Provision for credit losses
(1,800,000)
2,100,000
Net interest income after
provision for credit losses
57,701,000
46,448,000
NONINTEREST INCOME
Service charges on accounts
2,484,000
1,839,000 Mortgage banking income
2,980,000
2,651,000 Credit and debit card income
2,588,000
2,201,000 Interest rate swap income
663,000
80,000 Payroll services
1,094,000
1,040,000 Earnings on bank owned life insurance
665,000
543,000 Other income
1,214,000
348,000 Total noninterest income
11,688,000
8,702,000
NONINTEREST EXPENSE
Salaries and benefits
23,679,000
19,557,000 Occupancy
2,416,000
2,118,000 Furniture and equipment
962,000
787,000 Data processing costs
4,430,000
3,770,000 Core conversion costs
2,915,000
0 Acquisition costs
300,000
0 Core deposit intangible amortization
865,000
0 Other expense
6,540,000
4,872,000 Total noninterest expense
42,107,000
31,104,000
Income before federal income
tax expense
27,282,000
24,046,000
Federal income tax expense
4,597,000
4,509,000
Net Income
$22,685,000
$19,537,000
Basic earnings per share
$1.32
$1.21 Diluted earnings per share
$1.32
$1.21
Average basic shares outstanding
17,237,249
16,197,978 Average diluted shares outstanding
17,237,249
16,197,978
MERCANTILE BANK CORPORATIONCONSOLIDATED FINANCIAL HIGHLIGHTS(Unaudited)
Quarterly(dollars in thousands except per share data)
2026
2025
2025
2025
2025
1st Qtr
4th Qtr
3rd Qtr
2nd Qtr
1st QtrEARNINGS
Net interest income$55,901
51,015
52,002
49,479
48,548 Provision for credit losses$(1,800)
(700)
200
1,600
2,100 Noninterest income$11,688
11,056
10,388
11,462
8,702 Noninterest expense$42,107
36,726
34,750
33,379
31,104 Net income before federal income
tax expense$27,282
26,045
27,440
25,962
24,046 Net income$22,685
22,841
23,758
22,618
19,537 Basic earnings per share$1.32
1.40
1.46
1.39
1.21 Diluted earnings per share$1.32
1.40
1.46
1.39
1.21 Average basic shares outstanding
17,237,249
16,263,884
16,249,267
16,239,919
16,197,978 Average diluted shares outstanding
17,237,249
16,263,884
16,249,267
16,239,919
16,197,978
PERFORMANCE RATIOS
Return on average assets
1.35 %
1.44 %
1.50 %
1.50 %
1.32 % Return on average equity
12.54 %
13.50 %
14.72 %
14.72 %
13.34 % Net interest margin (fully tax-equivalent)
3.55 %
3.43 %
3.49 %
3.48 %
3.47 % Efficiency ratio
62.30 %
59.17 %
55.70 %
54.77 %
54.33 % Full-time equivalent employees
766
770
683
692
662
YIELD ON ASSETS / COST OF FUNDS
Yield on loans
6.04 %
6.12 %
6.35 %
6.29 %
6.28 % Yield on securities
3.27 %
2.96 %
2.90 %
2.82 %
2.73 % Yield on other interest-earning assets
4.00 %
4.25 %
4.63 %
4.91 %
4.80 % Yield on total earning assets
5.42 %
5.52 %
5.74 %
5.75 %
5.73 % Yield on total assets
5.09 %
5.20 %
5.41 %
5.44 %
5.43 % Cost of deposits
1.77 %
2.04 %
2.20 %
2.24 %
2.23 % Cost of borrowed funds
3.58 %
3.56 %
3.61 %
3.61 %
3.62 % Cost of interest-bearing liabilities
2.54 %
2.87 %
3.06 %
3.09 %
3.08 % Cost of funds (total earning assets)
1.87 %
2.09 %
2.25 %
2.27 %
2.26 % Cost of funds (total assets)
1.75 %
1.97 %
2.12 %
2.15 %
2.14 %
MORTGAGE BANKING ACTIVITY
Total mortgage loans originated$127,939
141,451
136,840
141,921
100,396 Purchase/construction mortgage loans originated$68,769
85,973
107,993
111,247
81,494 Refinance mortgage loans originated$59,170
55,478
28,847
30,674
18,902 Mortgage loans originated with intent to sell$105,873
116,886
111,334
112,323
80,453 Income on sale of mortgage loans$3,049
3,375
3,482
3,219
2,455
CAPITAL
Tangible equity to tangible assets
9.41 %
9.37 %
9.72 %
9.49 %
9.17 % Tier 1 leverage capital ratio
10.61 %
11.30 %
10.90 %
10.93 %
10.75 % Common equity risk-based capital ratio
11.27 %
11.01 %
11.33 %
10.90 %
10.90 % Tier 1 risk-based capital ratio
12.09 %
11.83 %
12.20 %
11.75 %
11.78 % Total risk-based capital ratio
14.59 %
14.35 %
14.87 %
14.37 %
14.44 % Tier 1 capital$723,395
704,776
685,440
666,068
647,795 Tier 1 plus tier 2 capital$872,668
854,876
835,263
814,796
794,143 Total risk-weighted assets$5,981,420
5,958,763
5,617,005
5,670,571
5,499,046 Book value per common share$42.66
42.19
40.46
38.87
37.47 Tangible book value per common share$37.34
36.78
37.41
35.82
34.42 Cash dividend per common share$0.39
0.38
0.38
0.37
0.37
ASSET QUALITY
Gross loan charge-offs$5
2,842
172
38
63 Recoveries$351
206
726
147
175 Net loan charge-offs (recoveries)$(346)
2,636
(554)
(109)
(112) Net loan charge-offs (recoveries) to average loans
(0.03 %)
0.23 %
(0.05 %)
(0.01 %)
(0.01 %) Allowance for credit losses$56,736
58,191
59,129
58,375
56,666 Allowance to loans
1.18 %
1.21 %
1.28 %
1.24 %
1.22 % Nonperforming loans$7,543
7,870
9,844
9,743
5,361 Other real estate/repossessed assets$0
0
0
0
0 Nonperforming loans to total loans
0.16 %
0.16 %
0.21 %
0.21 %
0.12 % Nonperforming assets to total assets
0.11 %
0.12 %
0.16 %
0.16 %
0.09 %
NONPERFORMING ASSETS - COMPOSITION
Commercial:
Commercial & industrial$1,122
1,393
1,509
1,727
2,257 Land development & construction$0
201
0
0
0 Owner occupied comm'l R/E$494
517
0
0
41 Non-owner occupied comm'l R/E$2,732
2,732
5,532
5,532
0 Multi-family & residential rental$0
0
0
0
0 Total commercial$4,348
4,843
7,041
7,259
2,298 Retail:
1-4 family mortgages$3,114
2,971
2,767
2,484
3,063 Other consumer$81
56
36
0
0 Total retail$3,195
3,027
2,803
2,484
3,063 Total nonperforming assets$7,543
7,870
9,844
9,743
5,361
NONPERFORMING ASSETS - RECON
Beginning balance$7,870
9,844
9,743
5,361
5,743 Additions$410
1,299
426
5,792
423 Return to performing status$(12)
0
(27)
0
0 Principal payments$(725)
(466)
(222)
(1,385)
(744) Sale proceeds$0
0
0
0
0 Loan charge-offs$0
(2,807)
(76)
(25)
(61) Valuation write-downs$0
0
0
0
0 Ending balance$7,543
7,870
9,844
9,743
5,361
LOAN PORTFOLIO COMPOSITION
Commercial:
Commercial & industrial$1,429,830
1,374,522
1,337,729
1,375,368
1,314,383 Land development & construction$119,560
117,373
70,806
67,520
68,790 Owner occupied comm'l R/E$799,066
778,869
729,451
725,106
705,645 Non-owner occupied comm'l R/E$1,101,758
1,110,674
1,091,210
1,134,012
1,183,728 Multi-family & residential rental$485,175
537,224
521,111
519,152
479,045 Total commercial$3,935,389
3,918,662
3,750,307
3,821,158
3,751,591 Retail:
1-4 family mortgages$768,237
790,857
780,917
799,426
817,212 Other consumer$113,067
112,369
83,936
77,435
67,746 Total retail$881,304
903,226
864,853
876,861
884,958 Total loans$4,816,693
4,821,888
4,615,160
4,698,019
4,636,549
END OF PERIOD BALANCES
Loans$4,816,693
4,821,888
4,615,160
4,698,019
4,636,549 Securities$1,125,433
1,102,230
855,138
826,415
787,583 Other interest-earning assets$577,619
458,548
457,373
246,254
351,846 Total earning assets (before allowance)$6,519,745
6,382,666
5,927,671
5,770,688
5,775,978 Total assets$6,945,035
6,835,219
6,308,487
6,180,988
6,141,200 Noninterest-bearing deposits$1,331,947
1,339,666
1,182,775
1,180,801
1,173,499 Interest-bearing deposits$4,087,571
3,944,786
3,629,038
3,529,671
3,508,286 Total deposits$5,419,518
5,284,452
4,811,813
4,710,472
4,681,785 Total borrowed funds$704,853
730,778
739,688
740,685
749,711 Total interest-bearing liabilities$4,792,424
4,675,564
4,368,726
4,270,356
4,257,997 Shareholders' equity$736,947
724,884
657,630
631,519
608,346
AVERAGE BALANCES
Loans$4,828,031
4,627,544
4,668,173
4,695,367
4,629,098 Securities$1,119,988
880,619
841,853
803,264
763,095 Other interest-earning assets$467,991
426,758
433,055
235,965
304,325 Total earning assets (before allowance)$6,416,010
5,934,921
5,943,081
5,734,596
5,696,518 Total assets$6,837,239
6,296,341
6,294,841
6,061,819
6,018,158 Noninterest-bearing deposits$1,318,537
1,227,100
1,215,918
1,152,631
1,144,781 Interest-bearing deposits$3,999,141
3,599,012
3,610,600
3,463,067
3,443,770 Total deposits$5,317,678
4,826,112
4,826,518
4,615,698
4,588,551 Total borrowed funds$712,240
720,499
749,679
749,811
738,628 Total interest-bearing liabilities$4,711,381
4,319,511
4,360,279
4,212,878
4,182,398 Shareholders' equity$733,366
671,029
640,495
616,229
594,145
View original content to download multimedia:https://www.prnewswire.com/news-releases/mercantile-bank-corporation-announces-solid-first-quarter-2026-results-302747777.htmlSOURCE Mercantile Bank Corporation
Original: Mercantile Bank Corporation Announces Solid First Quarter 2026 Results
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