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Mercantile Bank Corporation Reports Strong Second Quarter 2019 Results

Continued strength in core profitability and solid loan growth highlight quarter

GRAND RAPIDS, Mich., July 16, 2019 /PRNewswire/ -- Mercantile Bank Corporation (MBWM) ("Mercantile") reported net income of $11.7 million, or $0.71 per diluted share, for the second quarter of 2019, compared with net income of $9.4 million, or $0.57 per diluted share, for the respective prior-year period.  Net income during the first six months of 2019 totaled $23.5 million, or $1.43 per diluted share, compared to $20.3 million, or $1.22 per diluted share, during the first six months of 2018.

A bank owned life insurance claim increased reported net income during the second quarter of 2019 by approximately $1.3 million, or $0.08 per diluted share.  Excluding the impact of this transaction, diluted earnings per share increased $0.06, or 10.5 percent, during the second quarter of 2019 compared to the prior-year second quarter.  Bank owned life insurance claims and a gain on the sale of a former branch facility increased reported net income during the first six months of 2019 by approximately $3.1 million, or $0.19 per diluted share, while the successful collection of certain nonperforming commercial loans increased reported net income during the respective 2018 period by approximately $1.7 million, or $0.10 per diluted share.  Excluding the impacts of these transactions, diluted earnings per share increased $0.12, or 10.7 percent, during the first six months of 2019 compared to the respective prior-year period.

"We are very pleased to conclude the first half of 2019 with another quarter of solid operating results," said Robert B. Kaminski, Jr., President and Chief Executive Officer of Mercantile.  "Our sound financial condition, sustained strength in commercial and residential mortgage loan originations, and expected new loan fundings elicit confidence that the strong results achieved during the first six months of the year will continue throughout the last half of the year."

Second quarter highlights include:

  • Robust earnings performance and capital position
  • Healthy net interest margin
  • Increased fee income
  • Controlled overhead costs
  • Strong asset quality, as reflected by low levels of nonperforming assets and loans in the 30- to 89-days delinquent category
  • Annualized net loan growth of almost 12 percent
  • New commercial term loan originations of approximately $134 million
  • Continued strength in commercial and residential loan pipelines

Operating Results

Total revenue, which consists of net interest income and noninterest income, was $37.5 million during the second quarter of 2019, up $3.7 million, or 10.9 percent, from the prior-year second quarter.  Reflecting a higher level of earning assets, net interest income of $31.1 million during the second quarter of 2019 was up $1.9 million, or 6.5 percent, from the second quarter of 2018. 

The net interest margin was 3.79 percent in the second quarter of 2019.  The yield on average earning assets equaled 4.85 percent during the second quarter of 2019, up from 4.60 percent during the respective 2018 period mainly due to an increased yield on commercial loans.  The improved yield on commercial loans primarily reflects the positive impact of higher interest rates on variable-rate commercial loans stemming from the Federal Open Market Committee's raising of the targeted federal funds rate by 25 basis points in each of June, September, and December 2018.  The cost of funds equaled 1.06 percent during the second quarter of 2019, up from 0.68 percent during the prior-year second quarter mainly due to an increased cost of time deposits and a change in funding mix. Increased reliance on more costly wholesale funds during the twelve months ended June, 30, 2019, most of which occurred in the second half of 2018 and January 2019, was necessitated by various funding requirements, including ongoing loan growth and seasonal deposit withdrawals by certain business customers for bonus and tax payments.

Net interest income and the net interest margin during the second quarters of 2019 and 2018, and the first six months of the current year and prior year, were affected by purchase accounting accretion and amortization associated with fair value measurements.  Increases in interest income on loans totaling $0.6 million and $0.8 million were recorded during the second quarters of 2019 and 2018, respectively, and increases of $0.8 million and $3.0 million were recorded during the first six months of 2019 and 2018, 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 and prior-year second quarters, and increases of $0.3 million were recorded during both the first six months of 2019 and 2018.

Mercantile recorded a $0.9 million provision for loan losses during the second quarter of 2019 compared to a $0.7 million provision during the respective 2018 period.  The provision expense recorded during the current-year second quarter mainly reflected ongoing net loan growth, while the provision expense recorded during the second quarter of 2018 primarily reflected loan growth and increased allocations related to certain environmental factors.

Noninterest income during the second quarter of 2019 was $6.3 million, compared to $4.6 million during the prior-year second quarter.  Noninterest income during the second quarter of 2019 included a bank owned life insurance claim of $1.3 million.  Excluding the impact of this transaction, noninterest income increased $0.5 million, or 10.9 percent, during the current-year second quarter compared to the respective 2018 period.  The higher level of noninterest income primarily reflected increased mortgage banking activity income and credit and debit card income.  The increased mortgage banking activity income mainly reflected the success of ongoing strategic initiatives that were instituted to increase market penetration, along with a higher level of refinance activity stemming from the recent decrease in residential mortgage loan interest rates.  Increased service charges on accounts and payroll processing fees also contributed to the improved level of noninterest income. 

Noninterest expense totaled $22.1 million during the second quarter of 2019, up $0.7 million, or 3.1 percent, from the prior-year second quarter.  The higher level of expense primarily resulted from increased salary costs, mainly reflecting annual employee merit pay increases and higher stock-based compensation expense.

Mr. Kaminski continued, "As anticipated, our net interest margin remained strong during the second quarter of 2019, depicting our ongoing emphasis on loan pricing discipline and sound underwriting.  We are pleased with the growth in key fee income categories, and we remain steadfast in our efforts to achieve growth initiatives in a cost-conscious manner.  The noteworthy increase in mortgage banking activity income reflects the success of continuing strategic initiatives designed to further market penetration, along with a spike in refinance activity spurred by the recent decline in residential mortgage loan interest rates."

Balance Sheet

As of June 30, 2019, total assets were $3.58 billion, up $212 million, or 6.3 percent, from December 31, 2018.  Total loans and interest-earning deposits increased $128 million and $82.3 million, respectively, over the same time period.  During the twelve months ended June 30, 2019, total loans were up $245 million, or 9.3 percent.  Approximately $134 million and $259 million in commercial term loans to new and existing borrowers were originated during the second quarter and first six months of 2019, respectively, as ongoing sales and relationship-building efforts resulted in increased lending opportunities.  As of June 30, 2019, unfunded commitments on commercial construction and development loans totaled approximately $129 million, which are expected to be largely funded over the next 12 to 18 months.  The growth in interest-earning deposits mainly stemmed from certain deposit-gathering initiatives and an increase in wholesale funds.

Ray Reitsma, President of Mercantile Bank of Michigan, noted, "Our lending team's continuing focus on identifying new customer relationships and meeting the needs of our existing customer base is evidenced by the solid net loan growth realized during the second quarter of 2019.  We are very pleased with the level of new commercial term loan originations during the quarter, which were commensurate with quarterly originations over the past several years.  We remain committed to growing the loan portfolio in a disciplined manner, with an ongoing emphasis on credit quality and risk-based pricing, and maintaining the combined commercial and industrial loan and owner-occupied commercial real estate loan portfolios at a minimum percentage of total commercial loans.  Based on anticipated new loan fundings, we are confident that we can continue to grow the commercial loan portfolio in future periods.  Depicting our efforts to increase market presence and a higher level of refinance activity, our residential mortgage loan portfolio expanded for the thirteenth consecutive quarter.  In light of the current strong pipeline, we are optimistic that the residential mortgage loan portfolio can also increase going forward."

As of June 30, 2019, commercial and industrial loans and owner-occupied commercial real estate loans combined represented approximately 58 percent of total commercial loans, a level that has remained relatively consistent and in line with internal expectations. 

Total deposits at June 30, 2019, were $2.62 billion, up $156 million from December 31, 2018.  Local deposits and brokered deposits were up $99.3 million and $56.2 million, respectively, during the first six months of 2019.  The growth in local deposits was mainly driven by a special time deposit campaign that was introduced mid first quarter and ended in early April, along with an increase in business money market accounts. Wholesale funds were $543 million, or approximately 17 percent of total funds, as of June 30, 2019, compared to $474 million, or approximately 16 percent of total funds, as of December 31, 2018.  A substantial portion of the growth in wholesale funds during the first six months of 2019 occurred in January; the monies were used primarily to fund strong loan growth recorded in late 2018 and early 2019 and offset typical and expected seasonal business deposit withdrawals used for bonus and tax payments, as well as to maintain sufficient balance sheet liquidity.

Asset Quality

Nonperforming assets at June 30, 2019, were $4.0 million, or 0.1 percent of total assets, compared to $5.0 million, or 0.2 percent of total assets, at December 31, 2018.  The level of past due loans remains nominal, and loan relationships on the internal watch list have remained relatively consistent in number and dollar volume.  During the second quarter of 2019, nominal net loan recoveries, representing an annualized 0.01 percent of average total loans, were recorded. 

Capital Position

Shareholders' equity totaled $400 million as of June 30, 2019, an increase of $24.9 million from year-end 2018.  The Bank's capital position remains above "well-capitalized" with a total risk-based capital ratio of 12.4 percent as of June 30, 2019, compared to 12.3 percent at December 31, 2018.  At June 30, 2019, the Bank had approximately $78 million in excess of the 10.0 percent minimum regulatory threshold required to be considered a "well-capitalized" institution.  Mercantile reported 16,440,356 total shares outstanding at June 30, 2019.

As part of a $20 million common stock repurchase program announced in January 2015, and later expanded by $15 million in April 2016, Mercantile repurchased approximately 119,000 shares for $3.6 million, or a weighted average all-in cost per share of $30.23, during the first quarter of 2019; no shares were repurchased during the second quarter of 2019.  Since the program's inception, Mercantile repurchased approximately 1,275,000 shares for $29.0 million, or a weighted average all-in cost per share of $22.77.  In conjunction with the anticipated completion of its existing program, Mercantile announced a new $20 million stock repurchase plan in May 2019.

Mr. Kaminski concluded, "With our strong financial performance during the first six months of 2019, we are well positioned to meet growth and profitability goals and further enhance shareholder value.  The ongoing cash dividend program, including the announcement of an increased third quarter regular dividend earlier today, exhibits our long-term commitment to enhancing total shareholder return.  We continue to gain new clients through our value-added approach and the offering of a wide-range of products and services, and we are excited about opportunities that we believe are available to us to expand our business in our markets.  Based on our sustained financial strength and healthy loan pipelines, we are confident in our ability to deliver robust performance not only during the remainder of the current year, but into the foreseeable periods as well."

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 $3.5 billion and operates 46 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.

FOR FURTHER INFORMATION:


Robert B. Kaminski, Jr.                    

Charles Christmas

President & CEO                          

Executive Vice President & CFO

616-726-1502                              

616-726-1202

rkaminski@mercbank.com               

cchristmas@mercbank.com

 

Mercantile Bank Corporation







Second Quarter 2019 Results







MERCANTILE BANK CORPORATION

CONSOLIDATED BALANCE SHEETS

(Unaudited)










JUNE 30,


DECEMBER 31,


JUNE 30,



2019


2018


2018

ASSETS







   Cash and due from banks

$

57,675,000

$

64,872,000

$

56,338,000

   Interest-earning deposits


92,750,000


10,482,000


69,402,000

      Total cash and cash equivalents


150,425,000


75,354,000


125,740,000








   Securities available for sale


347,924,000


337,366,000


331,142,000

   Federal Home Loan Bank stock


18,002,000


16,022,000


11,036,000








   Loans


2,881,493,000


2,753,085,000


2,636,856,000

   Allowance for loan losses


(24,053,000)


(22,380,000)


(21,167,000)

      Loans, net


2,857,440,000


2,730,705,000


2,615,689,000








   Premises and equipment, net


51,823,000


48,321,000


47,102,000

   Bank owned life insurance


67,678,000


69,647,000


69,321,000

   Goodwill


49,473,000


49,473,000


49,473,000

   Core deposit intangible, net


4,634,000


5,561,000


6,514,000

   Other assets


28,740,000


31,458,000


32,504,000








      Total assets

$

3,576,139,000

$

3,363,907,000

$

3,288,521,000















LIABILITIES AND SHAREHOLDERS' EQUITY







   Deposits:







      Noninterest-bearing

$

918,581,000

$

889,784,000

$

884,470,000

      Interest-bearing


1,700,628,000


1,573,924,000


1,645,341,000

         Total deposits


2,619,209,000


2,463,708,000


2,529,811,000








   Securities sold under agreements to repurchase


119,669,000


103,519,000


94,573,000

   Federal Home Loan Bank advances


374,000,000


350,000,000


230,000,000

   Subordinated debentures


46,540,000


46,199,000


45,858,000

   Accrued interest and other liabilities


16,604,000


25,232,000


13,360,000

         Total liabilities


3,176,022,000


2,988,658,000


2,913,602,000








SHAREHOLDERS' EQUITY







   Common stock


306,669,000


308,005,000


311,720,000

   Retained earnings


90,618,000


75,483,000


74,084,000

   Accumulated other comprehensive income/(loss)


2,830,000


(8,239,000)


(10,885,000)

      Total shareholders' equity


400,117,000


375,249,000


374,919,000








      Total liabilities and shareholders' equity

$

3,576,139,000

$

3,363,907,000

$

3,288,521,000


 

Mercantile Bank Corporation














Second Quarter 2019 Results














MERCANTILE BANK CORPORATION

CONSOLIDATED REPORTS OF INCOME

(Unaudited)
















THREE MONTHS ENDED


THREE MONTHS ENDED

SIX MONTHS ENDED

SIX MONTHS ENDED


June 30, 2019


June 30, 2018

June 30, 2019

June 30, 2018

INTEREST INCOME














   Loans, including fees

$

36,765,000



$

31,855,000


$

72,555,000


$

64,170,000


   Investment securities


2,485,000




2,177,000



4,926,000



4,373,000


   Other interest-earning assets


569,000




287,000



976,000



757,000


      Total interest income


39,819,000




34,319,000



78,457,000



69,300,000
















INTEREST EXPENSE














   Deposits


5,529,000




3,262,000



10,334,000



6,347,000


   Short-term borrowings


68,000




61,000



173,000



118,000


   Federal Home Loan Bank advances


2,261,000




988,000



4,494,000



1,933,000


   Other borrowed money


845,000




783,000



1,695,000



1,478,000


      Total interest expense


8,703,000




5,094,000



16,696,000



9,876,000
















      Net interest income


31,116,000




29,225,000



61,761,000



59,424,000
















Provision for loan losses


900,000




700,000



1,750,000



700,000
















      Net interest income after














         provision for loan losses


30,216,000




28,525,000



60,011,000



58,724,000
















NONINTEREST INCOME














   Service charges on accounts


1,143,000




1,079,000



2,220,000



2,132,000


   Credit and debit card income


1,513,000




1,334,000



2,850,000



2,577,000


   Mortgage banking income


1,345,000




995,000



2,402,000



1,879,000


   Payroll services


355,000




317,000



860,000



800,000


   Earnings on bank owned life insurance


1,608,000




321,000



3,238,000



652,000


   Other income


370,000




504,000



1,397,000



891,000


      Total noninterest income


6,334,000




4,550,000



12,967,000



8,931,000
















NONINTEREST EXPENSE














   Salaries and benefits


13,286,000




12,757,000



26,302,000



25,094,000


   Occupancy


1,629,000




1,629,000



3,391,000



3,401,000


   Furniture and equipment


621,000




582,000



1,257,000



1,130,000


   Data processing costs


2,295,000




2,137,000



4,511,000



4,265,000


   Other expense


4,256,000




4,309,000



8,456,000



8,671,000


      Total noninterest expense


22,087,000




21,414,000



43,917,000



42,561,000
















      Income before federal income














         tax expense


14,463,000




11,661,000



29,061,000



25,094,000
















Federal income tax expense


2,748,000




2,215,000



5,522,000



4,767,000
















      Net Income

$

11,715,000



$

9,446,000


$

23,539,000


$

20,327,000
















   Basic earnings per share


$0.71




$0.57



$1.43



$1.22


   Diluted earnings per share


$0.71




$0.57



$1.43



$1.22
















   Average basic shares outstanding


16,428,187




16,601,400



16,428,875



16,598,274


   Average diluted shares outstanding


16,434,714




16,610,819



16,434,941



16,607,593



 

Mercantile Bank Corporation















Second Quarter 2019 Results















MERCANTILE BANK CORPORATION

CONSOLIDATED FINANCIAL HIGHLIGHTS

(Unaudited)


















Quarterly


Year-To-Date

(dollars in thousands except per share data)

2019


2019


2018


2018


2018







2nd Qtr


1st Qtr


4th Qtr


3rd Qtr


2nd Qtr


2019


2018

EARNINGS















   Net interest income

$

31,116


30,645


30,818


29,840


29,225


61,761


59,424

   Provision for loan losses

$

900


850


0


400


700


1,750


700

   Noninterest income

$

6,334


6,632


5,370


4,708


4,550


12,967


8,931

   Noninterest expense

$

22,087


21,830


21,958


21,650


21,414


43,917


42,561

   Net income before federal income















      tax expense

$

14,463


14,597


14,230


12,498


11,661


29,061


25,094

   Net income

$

11,715


11,824


11,573


10,123


9,446


23,539


20,327

   Basic earnings per share

$

0.71


0.72


0.70


0.61


0.57


1.43


1.22

   Diluted earnings per share

$

0.71


0.72


0.70


0.61


0.57


1.43


1.22

   Average basic shares outstanding


16,428,187


16,429,571


16,594,412


16,611,411


16,601,400


16,428,875


16,598,274

   Average diluted shares outstanding


16,434,714


16,435,176


16,600,108


16,619,295


16,610,819


16,434,941


16,607,593
















PERFORMANCE RATIOS















   Return on average assets


1.33%


1.39%


1.39%


1.22%


1.17%


1.36%


1.26%

   Return on average equity


12.08%


12.75%


12.40%


10.64%


10.25%


12.41%


11.15%

   Net interest margin (fully tax-equivalent)

3.79%


3.88%


3.98%


3.87%


3.92%


3.83%


3.99%

   Efficiency ratio


58.98%


58.56%


60.68%


62.67%


63.40%


58.77%


62.26%

   Full-time equivalent employees


652


631


630


637


667


652


667
















YIELD ON ASSETS / COST OF FUNDS















   Yield on loans


5.18%


5.21%


5.08%


4.91%


4.92%


5.19%


5.03%

   Yield on securities


2.85%


2.82%


2.80%


2.70%


2.64%


2.83%


2.62%

   Yield on other interest-earning assets


2.38%


2.40%


2.20%


1.98%


1.80%


2.42%


1.64%

   Yield on total earning assets


4.85%


4.89%


4.80%


4.60%


4.60%


4.87%


4.65%

   Yield on total assets


4.53%


4.56%


4.46%


4.28%


4.27%


4.55%


4.32%

   Cost of deposits


0.85%


0.77%


0.63%


0.56%


0.53%


0.82%


0.51%

   Cost of borrowed funds


2.40%


2.43%


2.22%


2.14%


2.01%


2.41%


1.92%

   Cost of interest-bearing liabilities


1.55%


1.47%


1.26%


1.11%


1.02%


1.51%


0.98%

   Cost of funds (total earning assets)


1.06%


1.01%


0.82%


0.73%


0.68%


1.04%


0.66%

   Cost of funds (total assets)


0.99%


0.94%


0.76%


0.68%


0.63%


0.97%


0.61%
















PURCHASE ACCOUNTING ADJUSTMENTS














   Loan portfolio - increase interest income

$

569


211


603


386


777


780


3,048

   Trust preferred - increase interest expense

$

171


171


171


171


171


342


342

   Core deposit intangible - increase overhead

$

450


477


477


477


530


927


1,086
















MORTGAGE BANKING ACTIVITY















   Total mortgage loans originated

$

80,205


44,932


44,448


66,829


62,032


125,137


102,969

   Purchase mortgage loans originated

$

41,986


29,891


29,729


47,704


41,239


71,877


66,376

   Refinance mortgage loans originated

$

38,219


15,041


14,719


19,125


20,793


53,260


36,593

   Total saleable mortgage loans

$

49,396


21,502


21,805


30,713


24,114


70,898


43,927

   Net gain on sale of mortgage loans

$

1,419


698


829


1,116


851


2,117


1,580
















CAPITAL















   Tangible equity to tangible assets


9.82%


9.41%


9.68%


9.98%


9.87%


9.82%


9.87%

   Tier 1 leverage capital ratio


11.17%


11.16%


11.41%


11.76%


11.81%


11.17%


11.81%

   Common equity risk-based capital ratio


10.47%


10.46%


10.41%


10.93%


11.03%


10.47%


11.03%

   Tier 1 risk-based capital ratio


11.82%


11.84%


11.80%


12.35%


12.49%


11.82%


12.49%

   Total risk-based capital ratio


12.55%


12.56%


12.50%


13.05%


13.19%


12.55%


13.19%

   Tier 1 capital

$

388,788


379,334


373,721


382,829


375,167


388,788


375,167

   Tier 1 plus tier 2 capital

$

412,841


402,469


396,102


404,521


396,334


412,841


396,334

   Total risk-weighted assets

$

3,289,958


3,204,295


3,167,655


3,100,158


3,003,778


3,289,958


3,003,778

   Book value per common share

$

24.34


23.37


22.70


22.84


22.57


24.34


22.57

   Tangible book value per common share

$

21.05


20.05


19.37


19.50


19.20


21.05


19.20

   Cash dividend per common share

$

0.26


0.26


1.00


0.24


0.22


0.52


0.44
















ASSET QUALITY















   Gross loan charge-offs

$

78


174


354


169


273


252


927

   Recoveries

$

96


79


1,042


294


766


175


1,893

   Net loan charge-offs (recoveries)

$

(18)


95


(688)


(125)


(493)


77


(966)

   Net loan charge-offs to average loans


(0.01%)


0.01%


(0.10%)


(0.02%)


(0.08%)


0.01%


(0.08%)

   Allowance for loan losses

$

24,053


23,135


22,380


21,692


21,167


24,053


21,167

   Allowance to originated loans


0.89%


0.89%


0.88%


0.88%


0.89%


0.89%


0.89%

   Nonperforming loans

$

3,505


4,138


4,141


4,852


4,965


3,505


4,965

   Other real estate/repossessed assets

$

446


396


811


948


842


446


842

   Nonperforming loans to total loans


0.12%


0.15%


0.15%


0.18%


0.19%


0.12%


0.19%

   Nonperforming assets to total assets


0.11%


0.13%


0.15%


0.18%


0.18%


0.11%


0.18%
















NONPERFORMING ASSETS - COMPOSITION













   Residential real estate:















      Land development

$

33


45


0


0


0


33


0

      Construction

$

0


0


0


0


0


0


0

      Owner occupied / rental

$

3,225


3,404


3,555


3,908


3,650


3,225


3,650

   Commercial real estate:















      Land development

$

0


0


0


0


0


0


0

      Construction

$

0


0


0


0


0


0


0

      Owner occupied  

$

642


791


1,363


1,543


1,957


642


1,957

      Non-owner occupied

$

26


62


0


0


0


26


0

   Non-real estate:















      Commercial assets

$

2


207


17


331


180


2


180

      Consumer assets

$

23


25


17


18


20


23


20

   Total nonperforming assets


3,951


4,534


4,952


5,800


5,807


3,951


5,807
















NONPERFORMING ASSETS - RECON















   Beginning balance

$

4,534


4,952


5,800


5,807


8,126


4,952


9,403

   Additions - originated loans/former branch

$

26


539


1,247


999


300


565


1,726

   Merger-related activity

$

34


0


0


5


17


34


46

   Return to performing status

$

0


0


0


0


0


0


(175)

   Principal payments

$

(512)


(382)


(1,836)


(857)


(778)


(894)


(2,335)

   Sale proceeds

$

(74)


(429)


(128)


(147)


(1,807)


(503)


(2,106)

   Loan charge-offs

$

(36)


(146)


(57)


(3)


(50)


(182)


(647)

   Valuation write-downs

$

(21)


0


(74)


(4)


(1)


(21)


(105)

   Ending balance

$

3,951


4,534


4,952


5,800


5,807


3,951


5,807
















LOAN PORTFOLIO COMPOSITION















   Commercial:















      Commercial & industrial

$

881,196


839,207


822,723


818,113


776,995


881,196


776,995

      Land development & construction

$

45,158


45,892


44,885


39,396


37,868


45,158


37,868

      Owner occupied comm'l R/E

$

556,868


551,517


548,619


542,730


533,075


556,868


533,075

      Non-owner occupied comm'l R/E

$

852,844


835,679


816,282


811,767


818,376


852,844


818,376

      Multi-family & residential rental

$

128,489


127,903


127,597


94,101


95,656


128,489


95,656

         Total commercial

$

2,464,555


2,400,198


2,360,106


2,306,107


2,261,970


2,464,555


2,261,970

   Retail:















      1-4 family mortgages

$

335,618


316,315


307,540


301,765


283,657


335,618


283,657

      Home equity & other consumer

$

81,320


83,126


85,439


89,545


91,229


81,320


91,229

         Total retail

$

416,938


399,441


392,979


391,310


374,886


416,938


374,886

         Total loans

$

2,881,493


2,799,639


2,753,085


2,697,417


2,636,856


2,881,493


2,636,856
















END OF PERIOD BALANCES















   Loans

$

2,881,493


2,799,639


2,753,085


2,697,417


2,636,856


2,881,493


2,636,856

   Securities

$

365,926


355,878


353,388


337,603


342,178


365,926


342,178

   Other interest-earning assets

$

92,750


168,572


10,482


28,193


69,402


92,750


69,402

   Total earning assets (before allowance)

$

3,340,169


3,324,089


3,116,955


3,063,213


3,048,436


3,340,169


3,048,436

   Total assets

$

3,576,139


3,551,754


3,363,907


3,300,106


3,288,521


3,576,139


3,288,521

   Noninterest-bearing deposits

$

918,581


857,734


889,784


879,442


884,470


918,581


884,470

   Interest-bearing deposits

$

1,700,628


1,753,240


1,573,924


1,629,368


1,645,341


1,700,628


1,645,341

   Total deposits

$

2,619,209


2,610,974


2,463,708


2,508,810


2,529,811


2,619,209


2,529,811

   Total borrowed funds

$

543,098


544,566


513,220


401,575


373,642


543,098


373,642

   Total interest-bearing liabilities

$

2,243,726


2,297,806


2,087,144


2,030,943


2,018,983


2,243,726


2,018,983

   Shareholders' equity

$

400,117


383,729


375,249


379,465


374,919


400,117


374,919
















AVERAGE BALANCES















   Loans

$

2,848,343


2,787,430


2,706,617


2,658,092


2,596,828


2,818,055


2,574,573

   Securities

$

357,718


354,459


343,597


342,593


340,990


356,098


344,690

   Other interest-earning assets

$

94,616


67,915


30,564


61,810


63,336


81,339


93,318

   Total earning assets (before allowance)

$

3,300,677


3,209,804


3,080,778


3,062,495


3,001,154


3,255,492


3,012,581

   Total assets

$

3,529,598


3,441,774


3,312,648


3,295,129


3,232,038


3,485,929


3,240,867

   Noninterest-bearing deposits

$

875,645


852,247


905,065


893,181


848,650


864,011


827,052

   Interest-bearing deposits

$

1,719,433


1,668,563


1,579,632


1,628,346


1,635,755


1,694,138


1,662,795

   Total deposits

$

2,595,078


2,520,810


2,484,697


2,521,527


2,484,405


2,558,149


2,489,847

   Total borrowed funds

$

530,802


532,864


434,365


383,830


365,124


531,827


370,975

   Total interest-bearing liabilities

$

2,250,235


2,201,427


2,013,997


2,012,176


2,000,879


2,225,965


2,033,770

   Shareholders' equity

$

389,133


376,103


370,175


377,574


365,521


382,654


367,666

 

 

 

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