Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to _______________ Commission File No. 001-38258 MERCHANTS BANCORP (Exact name of registrant as specified in its charter) ...

Exhibit 99.1 PRESS RELEASE Merchants Bancorp Reports Third Quarter 2025 Results For Release October 28, 2025 · Third quarter 2025 net income of $54.7 million, decreased $6.6 million compared to third quarter of 2024 and increased $16.7 million compared to the second quarter 2025. · Third quarter 2025 diluted earnings per common share of $0.97 decreased 17% compared to the third quarter of 2024 and increased 62% compared to the second quarter of 2025. · The total provision for credit losses decreased 45%, or ...

Core Viewpoint - China Merchants Port Holdings reported mixed results for 1H25, with revenue growth but a significant decline in net profit attributable to shareholders, primarily due to lower investment income from Shanghai International Port Group [1] Financial Performance - Revenue increased by 11.4% YoY to HK$6.46 billion, while net profit attributable to shareholders fell by 19.5% YoY to HK$3.58 billion, resulting in an EPS of HK$0.854 [1] - Operating cash flow declined YoY, mainly due to a decrease in dividends received from associate companies, but steady cash flow growth was maintained when excluding this factor [2] - Profit from the port business rose by 11.7% YoY in 1H25, and investment income from ports in which the firm holds stakes increased by 38.0% YoY [4] Operational Highlights - Container throughput at controlled terminals rose by 11.3% YoY, with overall container throughput at controlled ports growing by 4.3% YoY [2] - By region, container cargo volume at controlled terminals in the Pearl River Delta, Yangtze River Delta, Bohai Rim, and overseas terminals increased by 7.8%, 5.9%, 0.1%, and 5.0% YoY, respectively [3] - Significant growth in overseas terminal throughput was noted, with container throughput at the HIPG terminal in Sri Lanka rising by 542.9% YoY [5] Cost Management - The firm's costs and expenses fell YoY in 1H25, with the gross margin increasing by 2.9 percentage points YoY to 51% and the administrative expense ratio decreasing by 0.8 percentage points YoY [4] Future Outlook - The long-term growth potential of cargo volume at overseas terminals is viewed positively, with expectations for rapid growth driven by economic development in the hinterlands of these ports [5] - The 2025 net profit forecast remains largely unchanged, with a new 2026 net profit forecast introduced at HK$7.7 billion [6] - The stock is currently trading at 8.2x 2025e and 8.0x 2026e P/E, with a target price raised by 13.8% to HK$16.5, implying a 12.8% upside [6]

PART I – FINANCIAL INFORMATION [Item 1. Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) The unaudited statements show a significant net income decrease due to higher credit loss provisions, despite moderate asset growth [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets grew to $19.14 billion, driven by loans, while shareholders' equity slightly decreased due to a preferred stock redemption Key Balance Sheet Items | Key Balance Sheet Items | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | Change (%) | | :--- | :--- | :--- | :--- | | **Total Assets** | **$19,141,204** | **$18,805,732** | **+1.8%** | | Loans receivable, net | $10,432,117 | $10,354,002 | +0.8% | | Loans held for sale | $4,105,765 | $3,771,510 | +8.9% | | **Total Liabilities** | **$16,956,572** | **$16,562,422** | **+2.4%** | | Total Deposits | $12,686,835 | $11,919,976 | +6.4% | | Borrowings | $4,009,474 | $4,386,122 | -8.6% | | **Total Shareholders' Equity** | **$2,184,632** | **$2,243,310** | **-2.6%** | [Condensed Consolidated Statements of Income](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) Q2 net income fell 50% year-over-year to $38.0 million, primarily driven by a 432% surge in the provision for credit losses Three Months Ended June 30 | Metric (in thousands, except EPS) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Net Interest Income | $128,719 | $128,119 | +0.5% | | Provision for credit losses | $53,027 | $9,965 | +432.2% | | Noninterest Income | $50,480 | $31,351 | +61.0% | | Noninterest Expense | $77,337 | $50,380 | +53.5% | | **Net Income** | **$37,981** | **$76,393** | **-50.3%** | | **Diluted EPS** | **$0.60** | **$1.49** | **-59.7%** | Six Months Ended June 30 | Metric (in thousands, except EPS) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Net Interest Income | $250,915 | $255,175 | -1.7% | | Provision for credit losses | $60,754 | $14,691 | +313.5% | | Noninterest Income | $74,173 | $72,225 | +2.7% | | Noninterest Expense | $139,001 | $99,292 | +40.0% | | **Net Income** | **$96,220** | **$163,447** | **-41.1%** | | **Diluted EPS** | **$1.53** | **$3.29** | **-53.5%** | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail a higher Allowance for Credit Losses, two significant loan sales, a preferred stock redemption, and a new regulatory MOU - The Allowance for Credit Losses on Loans (ACL-Loans) increased to **$91.8 million** at June 30, 2025, from $84.4 million at year-end 2024, with a **$64.0 million** provision and **$56.6 million** in charge-offs for the six-month period[96](index=96&type=chunk)[308](index=308&type=chunk) - The company completed a **$373.3 million** multi-family loan securitization and a **$312.1 million** sale of home equity lines of credit in Q2 2025[134](index=134&type=chunk)[135](index=135&type=chunk) - All outstanding shares of 6% Series B Preferred Stock were redeemed on January 2, 2025, for **$125.0 million**[233](index=233&type=chunk)[234](index=234&type=chunk) - The Bank entered into a **confidential Memorandum of Understanding (MOU) with the FDIC and DFI** on June 30, 2025, and was in compliance with its terms as of the report date[268](index=268&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=57&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the net income decline from credit loss provisions, an improved funding mix, and a new regulatory MOU - The **50% decrease in Q2 2025 net income** is directly attributed to a **$43.1 million increase** in the provision for credit losses, linked to multi-family property values and mortgage fraud investigations[282](index=282&type=chunk)[325](index=325&type=chunk)[334](index=334&type=chunk) - The company's funding mix improved as **core deposits grew by $2.0 billion (22%)** since year-end 2024, while **brokered deposits were reduced by $1.3 billion (50%)**[287](index=287&type=chunk)[315](index=315&type=chunk)[316](index=316&type=chunk) - A **confidential MOU with the FDIC and DFI** was executed on June 30, 2025, which may limit or delay future expansion plans, though the bank currently exceeds required capital levels[280](index=280&type=chunk)[281](index=281&type=chunk) - Business volumes remain strong, with warehouse loan funding **increasing 49% YoY to $16.3 billion** and multi-family origination volume **increasing 33% YoY to $1.4 billion** in Q2[287](index=287&type=chunk)[419](index=419&type=chunk)[425](index=425&type-chunk) - A strong liquidity position is maintained with **$5.0 billion in unused borrowing capacity** from the FHLB and Federal Reserve Discount Window[282](index=282&type=chunk)[436](index=436&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=86&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate risk, with models showing an asset-sensitive position within policy limits Net Interest Income Sensitivity (12-Months Forward) | Net Interest Income Sensitivity (12-Months Forward) | -200 bps | -100 bps | +100 bps | +200 bps | | :--- | :--- | :--- | :--- | :--- | | **Dollar Change (in thousands)** | $(84,289) | $(44,357) | $42,895 | $85,982 | | **Percent Change** | (15.9)% | (8.3)% | 8.1% | 16.2% | Economic Value of Equity Sensitivity (Immediate Shock) | Economic Value of Equity Sensitivity (Immediate Shock) | -200 bps | -100 bps | +100 bps | +200 bps | | :--- | :--- | :--- | :--- | :--- | | **Dollar Change (in thousands)** | $54,849 | $36,112 | $2,604 | $4,897 | | **Percent Change** | 2.6% | 1.7% | 0.1% | 0.2% | [Item 4. Controls and Procedures](index=86&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective with no material changes to internal controls - The CEO and CFO concluded that as of June 30, 2025, the Company's **disclosure controls and procedures were effective**[486](index=486&type=chunk) - **No material changes** to the Company's internal control over financial reporting occurred during the quarter[487](index=487&type=chunk) PART II – OTHER INFORMATION [Item 1. Legal Proceedings](index=87&type=section&id=Item%201.%20Legal%20Proceedings) The company reported no legal proceedings for the period - None[490](index=490&type=chunk) [Item 1A. Risk Factors](index=87&type=section&id=Item%201A.%20Risk%20Factors) No material changes were reported from the risk factors previously disclosed in the 2024 Annual Report - **No material changes** from the risk factors disclosed in the 2024 Form 10-K[491](index=491&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=87&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities during the period - None[492](index=492&type=chunk) [Item 6. Exhibits](index=88&type=section&id=Item%206.%20Exhibits) This section lists filed exhibits, including Sarbanes-Oxley certifications and XBRL interactive data files - Exhibits filed include **CEO and CFO certifications** under Sarbanes-Oxley Sections 302 and 906, along with XBRL interactive data files[497](index=497&type=chunk)

Exhibit 99.1 PRESS RELEASE Merchants Bancorp Reports Second Quarter 2025 Results For Release July 28, 2025 Total assets of $19.1 billion at June 30, 2025 increased by $343.4 million, or 2%, compared to March 31, 2025, and $335.5 million compared to December 31, 2024. The increase compared to both periods was primarily driven by higher balances in the mortgage warehouse portfolios. Total loan balances grew by 2% even with two loan sale transactions in the second quarter totaling over $685.4 million related t ...

PART I – FINANCIAL INFORMATION [Item 1. Financial Statements](index=8&type=section&id=Item%201.%20Financial%20Statements) Presents unaudited condensed consolidated financial statements for Q1 2025, including balance sheets, income, comprehensive income, equity, and cash flows [Condensed Consolidated Balance Sheets](index=8&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets remained stable at $18.8 billion, with increased loans held for sale and deposits, offset by reduced borrowings and preferred stock redemption Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | **Total Assets** | **$18,797,800** | **$18,805,732** | **-0.04%** | | Loans receivable, net | $10,343,724 | $10,354,002 | -0.10% | | Loans held for sale | $3,983,452 | $3,771,510 | +5.62% | | **Total Liabilities** | **$16,637,065** | **$16,562,422** | **+0.45%** | | Total deposits | $12,406,165 | $11,919,976 | +4.08% | | Borrowings | $4,001,744 | $4,386,122 | -8.76% | | **Total Shareholders' Equity** | **$2,160,735** | **$2,243,310** | **-3.68%** | - The company redeemed all outstanding shares of its **6% Series B Preferred Stock** in Q1 2025, which reduced total shareholders' equity[12](index=12&type=chunk) [Condensed Consolidated Statements of Income](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) Q1 2025 net income significantly decreased to $58.2 million, driven by lower net interest and noninterest income, and higher expenses Consolidated Statements of Income Highlights (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Net Interest Income | $122,196 | $127,056 | -3.8% | | Provision for credit losses | $7,727 | $4,726 | +63.5% | | Total noninterest income | $23,693 | $40,874 | -42.0% | | Total noninterest expense | $61,664 | $48,912 | +26.1% | | **Net Income** | **$58,239** | **$87,054** | **-33.1%** | | **Diluted EPS** | **$0.93** | **$1.80** | **-48.3%** | - A significant factor in the noninterest income decline was a sharp drop in loan servicing fees, which fell from **$19.4 million in Q1 2024 to $4.0 million in Q1 2025**[15](index=15&type=chunk) - The company incurred a **$5.4 million impact** from preferred stock redemption in Q1 2025, which reduced net income allocated to common shareholders[15](index=15&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=14&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2025 operating activities generated $148.0 million cash, reversing a prior-year outflow, leading to a $44.7 million increase in cash Consolidated Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $148,038 | $(383,772) | | Net cash used in investing activities | $(903) | $(695,019) | | Net cash (used in) provided by financing activities | $(102,449) | $1,003,124 | | **Net Change in Cash and Cash Equivalents** | **$44,686** | **$(75,667)** | [Notes to Condensed Consolidated Financial Statements](index=15&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Provides detailed disclosures on financial statements, including asset sales, loan composition, credit losses, and regulatory capital - On January 26, 2024, the company completed the sale of its Farmers-Merchants Bank of Illinois (FMBI) branches, resulting in a net gain of **$715,000**[28](index=28&type=chunk)[29](index=29&type=chunk)[30](index=30&type=chunk) - The company holds restricted cash of **$33.4 million** as of March 31, 2025, as collateral for senior credit linked notes[40](index=40&type=chunk) Loan Portfolio Composition (in thousands) | Loan Type | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Mortgage warehouse repurchase agreements | $1,408,239 | $1,446,068 | | Residential real estate | $1,332,601 | $1,322,853 | | Multi-family financing | $4,600,117 | $4,624,299 | | Healthcare financing | $1,583,290 | $1,484,483 | | Commercial and commercial real estate | $1,418,741 | $1,476,211 | | **Total Loans Receivable** | **$10,427,137** | **$10,438,388** | Allowance for Credit Losses (ACL) Activity - Q1 2025 (in thousands) | Activity | Amount | | :--- | :--- | | Beginning Balance (Jan 1, 2025) | $84,386 | | Provision for credit losses | $9,506 | | Charge-offs | $(10,507) | | Recoveries | $28 | | **Ending Balance (Mar 31, 2025)** | **$83,413** | - Nonaccrual loans increased to **$284.0 million** at March 31, 2025, from $279.7 million at December 31, 2024, primarily within the Multi-family financing portfolio[106](index=106&type=chunk) - The company redeemed all outstanding shares of its **6.00% Series B Preferred Stock** on January 2, 2025, for **$125.0 million**[197](index=197&type=chunk) Segment Net Income (in thousands) | Segment | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Multi-family Mortgage Banking | $3,413 | $16,609 | | Mortgage Warehousing | $15,398 | $20,190 | | Banking | $47,107 | $56,425 | | Other | $(7,679) | $(6,170) | | **Total Net Income** | **$58,239** | **$87,054** | - As of March 31, 2025, both the Company and Merchants Bank were categorized as **well capitalized** under regulatory frameworks[223](index=223&type=chunk)[225](index=225&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=91&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Q1 2025 net income declined due to market uncertainty, lower noninterest income, higher expenses, and increased credit losses, despite strong liquidity - Net income for Q1 2025 was **$58.2 million**, a decrease of **$28.8 million** from Q1 2024, with diluted EPS falling **48% to $0.93**[237](index=237&type=chunk) - Of the **$28.8 million decrease** in net income, management attributes **$19.3 million** (or **$0.34 per diluted share**) to changes in valuation adjustments[237](index=237&type=chunk) - Core deposits grew **30% year-over-year to $10.7 billion**, representing **86% of total deposits**, while brokered deposits decreased by **70% to $1.7 billion**[237](index=237&type=chunk) Key Performance Metrics | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Interest Margin | 2.89% | 3.14% | | Efficiency Ratio | 42.27% | 29.13% | | Tangible Book Value per Share | $34.90 | $29.26 | [Financial Condition](index=95&type=section&id=Financial%20Condition) Total assets stable at $18.8 billion, with increased loans held for sale and core deposits, reduced brokered deposits and borrowings, and lower shareholders' equity - Loans held for sale increased by **$211.9 million (6%) to $4.0 billion**, mainly due to higher volume in warehouse participations[254](index=254&type=chunk) - Core deposits increased by **$1.3 billion (14%) to $10.7 billion**, now comprising **86% of total deposits**, up from 79% at year-end 2024[271](index=271&type=chunk) - Brokered deposits were reduced by **$815.7 million (32%) to $1.7 billion**, representing **14% of total deposits** compared to 21% at year-end 2024[272](index=272&type=chunk) - Shareholders' equity decreased by **$82.6 million**, largely due to the **$125.0 million redemption of Series B Preferred Stock**, partially offset by **$58.2 million in net income**[277](index=277&type=chunk) [Asset Quality](index=98&type=section&id=Asset%20Quality) Asset quality deteriorated with nonperforming loans rising to 2.73% of total loans, primarily in multi-family and healthcare portfolios, leading to higher net charge-offs - Nonperforming loans were **$284.6 million (2.73% of total loans)** at Q1 2025, compared to $279.7 million (2.68%) at Q4 2024 and $131.8 million (1.22%) at Q1 2024[279](index=279&type=chunk) - The increase in nonperforming loans is attributed to multi-family and healthcare customers with variable-rate loans facing higher payments due to elevated interest rates[279](index=279&type=chunk)[281](index=281&type=chunk) - The company executed credit protection arrangements (credit linked notes and credit default swaps) covering a loan balance of **$2.2 billion** as of March 31, 2025, to mitigate credit risk[283](index=283&type=chunk) - Net charge-offs for Q1 2025 were **$10.5 million**, primarily from five customers in the multi-family portfolio[287](index=287&type=chunk) [Results of Operations](index=100&type=section&id=Results%20of%20Operations) Q1 2025 net income fell 33% due to decreased net interest income, a 42% drop in noninterest income, and a 26% rise in noninterest expense - Net interest margin decreased to **2.89%** from 3.14% in Q1 2024, negatively impacted by a business mix shift towards lower-margin loans held for sale[293](index=293&type=chunk) - Noninterest income decreased by **$17.2 million (42%)**, primarily due to a **$15.4 million drop in loan servicing fees**, including a negative fair value adjustment of **$0.8 million** on servicing rights in Q1 2025[316](index=316&type=chunk)[317](index=317&type=chunk) - Noninterest expense increased by **$12.8 million (26%)**, driven by a **$6.8 million increase in salaries** and a new **$3.9 million expense** for credit risk transfer premiums[321](index=321&type=chunk) - The provision for credit losses increased **63% to $7.7 million**, with **$9.5 million** allocated for loans, primarily in the multi-family portfolio[313](index=313&type=chunk)[314](index=314&type=chunk)[315](index=315&type=chunk) [Our Segments](index=111&type=section&id=Our%20Segments) All primary segments experienced year-over-year net income declines in Q1 2025, impacted by lower servicing fees, negative derivative adjustments, and reduced net interest income Segment Net Income (in thousands) | Segment | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Multi-family Mortgage Banking | $3,413 | $16,609 | -79% | | Mortgage Warehousing | $15,398 | $20,190 | -24% | | Banking | $47,107 | $56,425 | -17% | - The Multi-family Mortgage Banking segment's decline was primarily due to a **$12.5 million decrease in loan servicing fees** and a **$5.0 million increase in noninterest expense**[336](index=336&type=chunk) - Despite a **49% increase in loan funding volume to $11.9 billion**, the Mortgage Warehousing segment's net income fell due to a negative swing in derivative fair value adjustments[340](index=340&type=chunk)[341](index=341&type=chunk) [Liquidity and Capital Resources](index=115&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintained strong liquidity with $4.7 billion in unused borrowing capacity and capital ratios well above regulatory minimums, despite preferred stock redemption - The company had **$4.7 billion** in available unused borrowing capacity with the FHLB and Federal Reserve discount window as of March 31, 2025[346](index=346&type=chunk) - Uninsured deposits totaled approximately **$3.0 billion**, representing **24% of total Bank deposits**, with an insured cash sweep program holding **$1.5 billion**[273](index=273&type=chunk)[348](index=348&type=chunk) - The company redeemed all outstanding shares of its **6% Series B Preferred Stock** on January 2, 2025, for **$125.0 million**[361](index=361&type=chunk) Company Capital Ratios | Ratio | March 31, 2025 | Minimum to be Well Capitalized | | :--- | :--- | :--- | | Total capital (to risk-weighted assets) | 13.0% | 10.5% (with buffer) | | Tier I capital (to risk-weighted assets) | 12.4% | 8.5% (with buffer) | | Common Equity Tier I capital | 9.2% | 7.0% (with buffer) | | Tier I capital (to average assets) | 12.1% | 5.0% | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=121&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is asset-sensitive, with NII and EVE within policy limits under various interest rate shock scenarios as of March 31, 2025 Net Interest Income (NII) Sensitivity (Twelve Months Forward) | Rate Change (bps) | Dollar Change (in thousands) | Percent Change | | :--- | :--- | :--- | | +200 | $73,001 | 13.9% | | +100 | $36,422 | 6.9% | | -100 | $(35,378) | -6.7% | | -200 | $(66,284) | -12.6% | Economic Value of Equity (EVE) Sensitivity (Immediate Shock) | Rate Change (bps) | Dollar Change (in thousands) | Percent Change | | :--- | :--- | :--- | | +200 | $(10,228) | -0.5% | | +100 | $(5,088) | -0.2% | | -100 | $8,370 | 0.4% | | -200 | $(1,762) | -0.1% | - The company's interest rate risk management policy limits the change in NII to **20% for a +/-100 bps move** and **30% for a +/-200 bps move**, remaining within these limits as of March 31, 2025[388](index=388&type=chunk) [Item 4. Controls and Procedures](index=126&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal controls - The CEO and CFO concluded that as of March 31, 2025, the Company's disclosure controls and procedures were effective[396](index=396&type=chunk) - No material changes to the Company's internal control over financial reporting occurred during the first quarter of 2025[397](index=397&type=chunk) PART II – OTHER INFORMATION [Item 1. Legal Proceedings](index=127&type=section&id=Item%201.%20Legal%20Proceedings) No legal proceedings were reported during the period - There are no legal proceedings to report[399](index=399&type=chunk) [Item 1A. Risk Factors](index=127&type=section&id=Item%201A.%20Risk%20Factors) No material changes to previously disclosed risk factors occurred - No material changes from the risk factors disclosed in the 2024 Annual Report on Form 10-K have occurred[400](index=400&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=127&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales of equity securities or use of proceeds were reported - There were no unregistered sales of equity securities to report[401](index=401&type=chunk) [Item 6. Exhibits](index=128&type=section&id=Item%206.%20Exhibits) Lists exhibits including corporate governance documents and CEO/CFO certifications - Exhibits filed include corporate governance documents and CEO/CFO certifications as required by Sections 302 and 906 of the Sarbanes-Oxley Act[406](index=406&type=chunk)

Net income of $58.2 million for the first quarter of 2025 decreased by $28.8 million, or 33%, compared to the first quarter of 2024, reflecting market uncertainty that delayed origination closings and permanent loan conversions in a growing pipeline, which negatively impacted the recognition of gain on sale and net interest margin. The decrease in net income was primarily driven by a $17.2 million, or 42%, decrease in noninterest income, a $12.8 million, or 26%, increase in noninterest expense, a $4.9 milli ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K [Mark One] ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______ to _______ Commission file number 001-38258 MERCHANTS BANCORP (Exact name of Registrant as specified in its charter) | INDIANA | 20-57474 ...

[Financial Performance Highlights](index=1&type=section&id=Financial%20Performance%20Highlights) Merchants Bancorp achieved record full-year 2024 net income and diluted EPS, with strong Q4 growth driven by a significant increase in noninterest income and record total assets [Q4 and Full-Year 2024 Key Results](index=1&type=section&id=Q4%20and%20Full-Year%202024%20Key%20Results) Merchants Bancorp achieved record full-year 2024 net income and diluted EPS, with strong Q4 growth driven by a significant increase in noninterest income and record total assets Full Year 2024 vs. 2023 Performance | Metric | FY 2024 | Change vs. FY 2023 | | :--- | :--- | :--- | | Net Income | $320.4 million | ▲ 15% | | Diluted EPS | $6.30 | ▲ 12% | Q4 2024 Performance Highlights | Metric | Q4 2024 | Change vs. Q4 2023 | Change vs. Q3 2024 | | :--- | :--- | :--- | :--- | | Net Income | $95.7 million | ▲ 23% | ▲ 56% | | Diluted EPS | $1.85 | ▲ 17% | ▲ 58% | | Noninterest Income | - | - | ▲ 253% | Key Balance Sheet and Value Metrics (as of Dec 31, 2024) | Metric | Value | Change vs. Dec 31, 2023 | Change vs. Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Total Assets | $18.8 billion | ▲ 11% | ▲ 1% | | Tangible Book Value per Share | $34.15 | ▲ 25% | ▲ 5% | - Q4 2024 results were positively impacted by favorable fair market value adjustments to servicing rights (**$10.4 million**) and interest rate floor derivatives (**$2.6 million**), contributing approximately **$0.21 per diluted common share**, effectively reversing the negative impact of **$0.24 per share** from similar adjustments in Q3 2024[1](index=1&type=chunk) [Management Commentary](index=2&type=section&id=Management%20Commentary) Management attributed record 2024 performance to a superior business model, emphasizing effective capital management, shareholder value, and strategic risk mitigation despite increased nonperforming loans - Chairman and CEO Michael F. Petrie attributed the **record-breaking 2024 performance** to a superior business model that enables growth in any environment, emphasizing the focus on managing capital and delivering value to shareholders[3](index=3&type=chunk) - President and COO Michael J. Dunlap stated that despite recent increases in nonperforming loans, **delinquencies have declined** and **charge-offs have been minimal**, expressing confidence in the team's ability to deliver profitable growth, supported by strategic risk mitigation and capital strengthening actions[4](index=4&type=chunk) [Financial Condition Analysis](index=3&type=section&id=Financial%20Condition%20Analysis) The company's financial condition at year-end 2024 reflects record asset growth, strategic deposit mix shifts, and active credit risk management, despite an increase in non-performing loans [Total Assets](index=3&type=section&id=Total%20Assets) Total assets reached a record **$18.8 billion** by year-end 2024, growing **11%** YoY, primarily from loan portfolio expansion, with Q4 return on average assets at **2.07%** Total Assets Growth | Date | Total Assets | Change (YoY) | Change (QoQ) | | :--- | :--- | :--- | :--- | | Dec 31, 2024 | $18.8 billion | ▲ 11% | ▲ 1% | - The year-over-year increase in assets was mainly due to growth in **loans held for sale** and in the **warehouse and multi-family loan portfolios**[7](index=7&type=chunk) Return on Average Assets (ROA) | Period | ROA | | :--- | :--- | | Q4 2024 | 2.07% | | Q3 2024 | 1.34% | | Q4 2023 | 1.86% | | FY 2024 | 1.79% | | FY 2023 | 1.85% | [Asset Quality and Credit Risk](index=3&type=section&id=Asset%20Quality%20and%20Credit%20Risk) Asset quality showed mixed signals with a **18%** YoY increase in allowance for credit losses and a rise in non-performing loans to **2.68%**, though total delinquencies declined sequentially, supported by active credit risk management Allowance for Credit Losses on Loans | Date | Allowance | Change (YoY) | Change (QoQ) | | :--- | :--- | :--- | :--- | | Dec 31, 2024 | $84.4 million | ▲ 18% | ▼ $163,000 | Non-Performing Loans (NPLs) | Date | NPLs | NPLs as % of Gross Loans | | :--- | :--- | :--- | | Dec 31, 2024 | $279.7 million | 2.68% | | Sep 30, 2024 | $210.9 million | 2.04% | | Dec 31, 2023 | $82.0 million | 0.80% | - The increase in NPLs was primarily driven by **multi-family and healthcare customers** with variable rate loans impacted by higher interest rates[12](index=12&type=chunk) - Despite the rise in NPLs, total loan delinquency levels declined by **$56.3 million** to **$324.6 million** compared to the previous quarter[12](index=12&type=chunk) - The company has been actively reducing credit risk through credit protection arrangements, including credit default swaps, with **$2.3 billion** in loans covered as of December 31, 2024[14](index=14&type=chunk) [Securities Portfolio](index=4&type=section&id=Securities%20Portfolio) The securities portfolio showed divergent trends, with available-for-sale securities decreasing **12%** to **$980.0 million** and held-to-maturity securities increasing **38%** to **$1.7 billion** by year-end 2024 - Total securities available for sale stood at **$980.0 million**, a decrease of **12%** compared to December 31, 2023, mainly due to maturities and repayments[15](index=15&type=chunk) - Total securities held to maturity reached **$1.7 billion**, an increase of **38%** compared to December 31, 2023, driven by purchases of senior investment securities from the company's own credit risk transfer securitizations[16](index=16&type=chunk) [Deposits and Liquidity](index=5&type=section&id=Deposits%20and%20Liquidity) The company strategically reduced total deposits by **15%** to **$11.9 billion** by year-end 2024, significantly decreasing brokered deposits while growing core deposits by **16%** to comprise **79%** of the total, maintaining strong liquidity Deposit Composition Changes (YoY) | Deposit Type | Dec 31, 2024 | Change vs. Dec 31, 2023 | | :--- | :--- | :--- | | Total Deposits | $11.9 billion | ▼ 15% | | Core Deposits | $9.4 billion | ▲ 16% | | Brokered Deposits | $2.5 billion | ▼ 58% | - Core deposits as a percentage of total deposits increased significantly, from **58%** at year-end 2023 to **79%** at year-end 2024[19](index=19&type=chunk) - The company reported significant borrowing capacity with unused lines of credit totaling **$4.3 billion** as of December 31, 2024, with Federal Reserve Bank of Chicago availability alone able to fund **111%** of its uninsured deposits[21](index=21&type=chunk) [Results of Operations](index=6&type=section&id=Results%20of%20Operations) The company achieved record net income in FY 2024, driven by strong growth in both net interest and noninterest income, with significant Q4 sequential improvements from fair value adjustments [Comparison for the Three Months Ended (Q4 2024 vs. Q4 2023)](index=6&type=section&id=Comparison%20for%20the%20Three%20Months%20Ended%20(Q4%202024%20vs.%20Q4%202023)) Q4 2024 net income increased **23%** YoY to **$95.7 million**, driven by an **8%** rise in net interest income and a **72%** surge in noninterest income, partially offset by a **20%** increase in noninterest expense [Net Interest Income (YoY)](index=6&type=section&id=Net%20Interest%20Income%20(YoY)) Net interest income grew **8%** YoY to **$134.6 million**, primarily from higher average balances in loans and securities, despite a **6 basis point** decrease in net interest margin to **2.99%** - Net interest income rose **$10.3 million**, or **8%**, to **$134.6 million**, driven by higher average balances of loans and securities held to maturity[25](index=25&type=chunk) Key Net Interest Income Drivers (Q4 2024 vs Q4 2023) | Metric | Q4 2024 | Change vs. Q4 2023 | | :--- | :--- | :--- | | Net Interest Margin | 2.99% | ▼ 6 bps | | Avg. Loans & LHF Sale | $14.3 billion | ▲ 4% | | Avg. Yield on Loans | 7.43% | ▼ 55 bps | | Avg. Borrowings | $3.0 billion | ▲ 323% | [Noninterest Income (YoY)](index=7&type=section&id=Noninterest%20Income%20(YoY)) Noninterest income surged **72%** YoY to **$59.1 million**, primarily driven by a **$17.1 million** increase in net loan servicing fees, including a positive fair value adjustment, and gains on loan sales and syndication fees - Noninterest income increased by **$24.7 million (72%)**, driven by a **$17.1 million** increase in net loan servicing fees, a **$5.7 million** increase in gain on sale of loans, and a **$4.4 million** increase in syndication and asset management fees[29](index=29&type=chunk) - Loan servicing fees in Q4 2024 included a **$10.4 million positive fair market value adjustment** to servicing rights, compared to a **$7.6 million negative adjustment** in Q4 2023[33](index=33&type=chunk)[4](index=4&type=chunk) [Noninterest Expense (YoY)](index=7&type=section&id=Noninterest%20Expense%20(YoY)) Noninterest expense rose **20%** YoY to **$63.2 million**, primarily due to increased salaries, a **61%** rise in deposit insurance expenses, and higher credit risk transfer premium expense - Noninterest expense rose by **$10.6 million (20%)**, primarily due to increased salaries, a **$2.4 million (61%)** rise in deposit insurance expenses, and a **$1.9 million** increase in credit risk transfer premium expense[30](index=30&type=chunk) - The efficiency ratio improved slightly, decreasing by **49 basis points** to **32.62%** compared to **33.11%** in Q4 2023[30](index=30&type=chunk) [Comparison for the Three Months Ended (Q4 2024 vs. Q3 2024)](index=7&type=section&id=Comparison%20for%20the%20Three%20Months%20Ended%20(Q4%202024%20vs.%20Q3%202024)) Q4 2024 net income surged **56%** sequentially to **$95.7 million**, primarily driven by a **253%** increase in noninterest income due to significant positive fair market value adjustments, with modest increases in net interest income and noninterest expense [Net Interest Income (QoQ)](index=7&type=section&id=Net%20Interest%20Income%20(QoQ)) Net interest income increased modestly by **1%** sequentially to **$134.6 million**, attributed to higher average borrowing balances at lower rates, with the net interest margin remaining flat at **2.99%** - Net interest income increased by **$1.8 million (1%)** compared to the third quarter, with the net interest margin remaining flat at **2.99%**[32](index=32&type=chunk) - Interest expense decreased by **9%** sequentially, driven by lower average balances and rates on certificates of deposit[35](index=35&type=chunk) [Noninterest Income (QoQ)](index=8&type=section&id=Noninterest%20Income%20(QoQ)) Noninterest income dramatically increased **253%** sequentially to **$59.1 million**, primarily due to significant positive fair market value adjustments in net loan servicing fees and other income, reversing prior quarter's negative adjustments - Noninterest income increased by **$42.4 million**, or **253%**, from Q3 2024, driven by increases in net loan servicing fees, other income, gain on sale of loans, and syndication fees[36](index=36&type=chunk) - Loan servicing fees included a **$10.4 million positive fair market value adjustment** to servicing rights, compared to a **$6.7 million negative adjustment** in Q3 2024[36](index=36&type=chunk) - Other income included a **$2.6 million positive fair market value adjustment** to derivatives, compared to a **$7.7 million negative adjustment** in Q3 2024[40](index=40&type=chunk) [Noninterest Expense (QoQ)](index=9&type=section&id=Noninterest%20Expense%20(QoQ)) Noninterest expense increased **3%** sequentially to **$63.2 million**, driven by higher salaries and professional fees, while the efficiency ratio significantly improved to **32.62%** due to the surge in income - Noninterest expense increased by **$1.9 million (3%)**, driven by a **$2.3 million (7%)** increase in salaries and employee benefits and a **49%** increase in professional fees[38](index=38&type=chunk) - The efficiency ratio improved dramatically, decreasing by **838 basis points** to **32.62%** from **41.00%** in Q3 2024[38](index=38&type=chunk) [Comparison for the Twelve Months Ended (FY 2024 vs. FY 2023)](index=14&type=section&id=Comparison%20for%20the%20Twelve%20Months%20Ended%20(FY%202024%20vs.%20FY%202023)) Full-year 2024 net income reached a record **$320.4 million**, a **15%** increase, driven by **17%** growth in net interest income and **29%** in noninterest income, alongside a **40%** decrease in provision for credit losses, despite a **28%** rise in noninterest expense Full Year 2024 vs. 2023 Income Statement Highlights | Metric | FY 2024 | FY 2023 | Change | | :--- | :--- | :--- | :--- | | Net Interest Income | $522.6 million | $448.1 million | ▲ 17% | | Provision for credit losses | $24.3 million | $40.2 million | ▼ 40% | | Noninterest Income | $148.1 million | $114.7 million | ▲ 29% | | Noninterest Expense | $223.8 million | $174.6 million | ▲ 28% | | Net Income | $320.4 million | $279.2 million | ▲ 15% | | Diluted EPS | $6.30 | $5.64 | ▲ 12% | [Supplemental Information](index=15&type=section&id=Supplemental%20Information) This section provides key operating and non-GAAP metrics, detailed segment performance, and an in-depth analysis of the loan portfolio and credit quality [Key Operating and Non-GAAP Metrics](index=15&type=section&id=Key%20Operating%20and%20Non-GAAP%20Metrics) Key operating metrics demonstrated strength in Q4 2024, with ROA at **2.07%**, ROATCE at **22.10%**, and tangible book value per share growing **25%** YoY to **$34.15**, alongside improved capital ratios including a **9.1%** CET1 ratio Key Performance Ratios | Metric | Q4 2024 | Q3 2024 | Q4 2023 | | :--- | :--- | :--- | :--- | | Return on average assets | 2.07% | 1.34% | 1.86% | | Return on average tangible common equity | 22.10% | 14.43% | 23.60% | | Efficiency ratio | 32.62% | 41.00% | 33.11% | Capital and Value Metrics | Metric | Dec 31, 2024 | Sep 30, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | :--- | | Tangible book value per common share | $34.15 | $32.38 | $27.40 | | Common Equity Tier 1 capital ratio | 9.1% | 8.9% | 7.8% | | Total capital ratio | 13.6% | 12.2% | 11.6% | [Segment Performance](index=19&type=section&id=Segment%20Performance) All operating segments contributed positively to record 2024 earnings, with Banking as the largest contributor at **$210.1 million** net income and holding **63%** of total assets, followed by Mortgage Warehousing and Multi-family Mortgage Banking Net Income by Segment (Full Year) | Segment | FY 2024 Net Income | FY 2023 Net Income | | :--- | :--- | :--- | | Multi-family Mortgage Banking | $55.9 million | $36.5 million | | Mortgage Warehousing | $82.8 million | $73.5 million | | Banking | $210.1 million | $194.4 million | Total Assets by Segment (as of Dec 31, 2024) | Segment | Total Assets | % of Total | | :--- | :--- | :--- | | Multi-family Mortgage Banking | $479.1 million | 2% | | Mortgage Warehousing | $6.0 billion | 32% | | Banking | $11.8 billion | 63% | [Loan Portfolio and Credit Quality Details](index=20&type=section&id=Loan%20Portfolio%20and%20Credit%20Quality%20Details) The total loan portfolio was **$14.1 billion** at year-end 2024, with a shift in credit risk profile as 'Pass' rated loans decreased to **93.4%** and nonperforming loans rose to **2.68%**, though total delinquent loans decreased sequentially Loan Portfolio Composition (Dec 31, 2024) | Loan Type | Balance | | :--- | :--- | | Multi-family financing | $4.6 billion | | Healthcare financing | $1.5 billion | | Commercial and CRE | $1.5 billion | | Mortgage warehouse repurchase | $1.4 billion | | Residential real estate | $1.3 billion | Loan Credit Risk Profile (% of Loans Receivable) | Risk Rating | Dec 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Pass | 93.4% | 96.9% | | Special mention | 3.6% | 1.9% | | Substandard | 3.0% | 1.2% | Key Credit Quality Ratios | Metric | Dec 31, 2024 | Sep 30, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | :--- | | Nonperforming loans to total loans receivable | 2.68% | 2.04% | 0.80% | | Delinquent loans to total loans | 2.28% | 2.69% | 1.50% | [Consolidated Financial Statements](index=11&type=section&id=Consolidated%20Financial%20Statements) This section presents the unaudited Consolidated Balance Sheets and Statements of Income, offering a comprehensive overview of the company's financial position and operational results [Consolidated Balance Sheets](index=11&type=section&id=Consolidated%20Balance%20Sheets) This section presents the unaudited Consolidated Balance Sheets, detailing the company's assets, liabilities, and shareholders' equity as of December 31, 2024, and for the four preceding quarters - The Consolidated Balance Sheets provide a detailed snapshot of the company's financial position at the end of each reported period[43](index=43&type=chunk) [Consolidated Statement of Income](index=13&type=section&id=Consolidated%20Statement%20of%20Income) This section presents the unaudited Consolidated Statement of Income, outlining revenues, expenses, and net income for Q4 and full-year 2024, with comparative periods - The Consolidated Statement of Income details the company's operational performance, including interest and noninterest income and expenses, leading to net income for the reported periods[46](index=46&type=chunk)[48](index=48&type=chunk)

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to _______________ Commission File No. 001-38258 MERCHANTS BANCORP (Exact name of registrant as specified in its charter) ...