For the quarter ended September 2024, Mercantile Bank (MBWM) reported revenue of $57.96 million, down 0.4% over the same period last year. EPS came in at $1.22, compared to $1.30 in the year-ago quarter. The reported revenue represents a surprise of +1.98% over the Zacks Consensus Estimate of $56.83 million. With the consensus EPS estimate being $1.18, the EPS surprise was +3.39%. While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall ...

Robust local deposit and commercial loan growth and sustained strength in asset quality metrics highlight quarter GRAND RAPIDS, Mich., Oct. 15, 2024 /PRNewswire/ -- Mercantile Bank Corporation (NASDAQ: MBWM) ("Mercantile") reported net income of $19.6 million, or $1.22 per diluted share, for the third quarter of 2024, compared with net income of $20.9 million, or $1.30 per diluted share, for the third quarter of 2023. Net income during the first nine months of 2024 totaled $60.0 million, or $3.72 per dilute ...

Financial Data and Key Metrics Changes - The bank's net income for Q2 2024 was $18.8 million or $1.17 per diluted share, down from $20.4 million or $1.27 per diluted share in the same period last year [17] - For the first six months of 2024, net income totaled $40.3 million or $2.50 per diluted share, compared to $41.3 million or $2.58 per diluted share in the first half of 2023 [18] - The total risk-based capital ratio decreased from 13.9% to 12.9%, while the Tier 1 leverage capital ratio declined from 12.2% to 11.3% [3][3] Business Line Data and Key Metrics Changes - Total net interest income grew by 40% in the first half of 2024 compared to the same period in 2023, with mortgage banking income increasing by 76% [14][49] - Interest income on loans increased due to a higher interest rate environment and solid growth in commercial and residential mortgage loans [19] - The loan-to-deposit ratio improved to 107% as of June 30, 2024, down from 110% at year-end 2023, with deposit growth outpacing loan growth [11] Market Data and Key Metrics Changes - The cost of deposits increased by 106 basis points compared to Q2 2023, with average deposits up nearly 13% [28] - Interest income on securities and interest-earning deposits also increased due to a higher interest rate environment [26] - The bank's asset quality remained strong, with non-performing assets totaling $9.1 million, representing 16 basis points of total assets [12] Company Strategy and Development Direction - The bank aims to reduce its loan-to-deposit ratio to the mid-90% range through a three-pronged approach focusing on public and municipal banking, small business banking, and retail customer growth [45] - The strategy includes growing local deposits, which increased by approximately $260 million in the first half of 2024, reflecting a 14% annualized growth rate [47] - The bank is also focusing on maintaining a strong capital position while navigating the challenges in the financial environment [5][38] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the bank's ability to navigate challenges and maintain a strong financial condition [5] - The bank expects continued loan growth in the range of 4% to 6% and a stable net interest margin between 3.50% and 3.60% for the third and fourth quarters [39] - Management noted that the competitive environment for deposits has stabilized, with no significant increases in deposit pricing expected [25] Other Important Information - The bank recorded a provision expense of $3.5 million for Q2 2024, primarily due to a specific allocation for a non-performing commercial loan [34] - Non-interest expenses increased by $1.9 million and $3.3 million during Q2 and the first half of 2024, respectively, largely due to higher salary and benefit costs [37] Q&A Session Summary Question: Loan to Deposit Ratio Target - The management does not focus on a specific timeframe for achieving the loan-to-deposit ratio target, emphasizing the need to grow the loan portfolio in line with market demand [9] Question: Deposit Competition - Management acknowledged that the transfer from non-interest-bearing deposits has slowed, and commercial customers are now more focused on cash management [22][24] Question: Credit Quality and Reserves - A specific allocation for a non-performing commercial loan relationship drove the increase in reserves, but management does not expect systemic issues in the portfolio [55][56] Question: Future Provisioning - Management indicated that the average provision expense from the first and second quarters would be a reasonable expectation moving forward [57] Question: Capital Management and Buyback Program - The bank is focused on preserving capital and is not expected to initiate a buyback program at current stock levels, despite recent stock performance [90]

Financial Performance - Net revenue for Q2 2024 was $56.8 million, an increase of $1.6 million or 2.8% from $55.2 million in Q2 2023[2] - Net income for Q2 2024 was $18.8 million, or $1.17 per diluted share, compared to $20.4 million, or $1.27 per diluted share in Q2 2023[16] - Net income for Q2 2024 was $18.8 million, a decrease from $20.4 million in Q2 2023[32] - Basic earnings per share were $1.17 in Q2 2024, down from $1.27 in Q2 2023[32] - Net interest income decreased to $47.1 million, down $0.5 million or 1.0% from $47.6 million in Q2 2023, primarily due to increased cost of funds[2] - Noninterest income rose to $9.7 million, up $2.0 million or 26.6% from $7.7 million in Q2 2023, driven by higher mortgage banking income and service charges[4] Asset and Loan Growth - Total assets increased to $5.60 billion, up $249 million from $5.35 billion at the end of 2023[6] - Total loans grew by $134 million or an annualized 6.3% in the first half of 2024, with commercial loans increasing by $118 million or 6.9%[6] - Total loans amounted to $4.438 billion, a slight increase from $4.051 billion in the prior period, indicating a growth of about 9.6%[33] - The commercial loan portfolio reached $1.275 billion, showing a growth compared to the previous quarter's $1.229 billion[33] - The average balance of loans was reported at $4.39 billion, indicating a robust lending activity[1] Deposits and Funding - Total deposits increased by $246 million, or an annualized 12.6%, reaching $4.15 billion as of June 30, 2024[24] - Interest-bearing deposits totaled $3.026 billion, reflecting a decrease from $3.385 billion, indicating a decline of approximately 10.6%[33] - Non-interest-bearing deposits amounted to $1.13 billion, showcasing a strong liquidity position[1] - Total borrowed funds stood at $789.327 million, consistent with the previous quarter's figures[33] Credit Quality and Provisions - Nonperforming assets totaled $9.1 million, or 0.2% of total assets, an increase from $3.6 million or less than 0.1% at the end of 2023[8] - Provisions for credit losses rose to $3.5 million in Q2 2024 from $2.0 million in Q2 2023[20] - Nonperforming loans increased to $9,129,000 in Q2 2024 from $6,040,000 in Q1 2024[39] - The allowance for credit losses rose to $55,408,000 in Q2 2024 from $51,638,000 in Q1 2024[39] Capital and Shareholder Returns - The bank's capital position remains strong, with excess capital over the minimum regulatory requirement approximating $151 million[9] - Shareholders' equity increased by $29 million to $551 million as of June 30, 2024[26] - The bank plans to continue its regular quarterly cash dividend program, reflecting its commitment to providing competitive returns to shareholders[10] - Cash dividend per common share remained stable at $0.35 in both Q2 2024 and Q1 2024[39] Efficiency and Cost Management - Noninterest expense totaled $29.7 million in Q2 2024, up from $27.8 million in Q2 2023, primarily due to higher salary costs and data processing expenses[21] - The efficiency ratio for Q2 2024 was 52.40%, an increase from 51.42% in Q1 2024[39] Market Strategy and Future Plans - The company plans to expand its market presence through strategic acquisitions and new product developments in the upcoming quarters[33] - The bank aims to expand its market presence while maintaining exceptional service standards[35] - The bank's commitment to community service and personalized financial products distinguishes it in the Michigan banking sector[35]

Over the last four quarters, the company has surpassed consensus EPS estimates three times. Mercantile Bank shares have added about 9.3% since the beginning of the year versus the S&P 500's gain of 18.1%. Mercantile Bank, which belongs to the Zacks Banks - Midwest industry, posted revenues of $56.75 million for the quarter ended June 2024, surpassing the Zacks Consensus Estimate by 0.93%. This compares to year-ago revenues of $55.2 million. The company has topped consensus revenue estimates four times over ...

Strong local deposit and commercial loan growth and ongoing strength in asset quality metrics highlight quarter Second quarter highlights include: Net revenue, consisting of net interest income and noninterest income, was $56.8 million during the second quarter of 2024, up $1.6 million, or 2.8 percent, from $55.2 million during the prior-year second quarter. Net interest income during the current-year second quarter was $47.1 million, down $0.5 million, or 1.0 percent, from $47.6 million during the respecti ...

"The Board of Directors' declaration of an increased third quarter cash dividend is a testament to our ongoing commitment to enhance shareholder value through worthwhile cash returns," said Ray Reitsma, President and Chief Executive Officer of Mercantile. "Our financial metrics have remained strong during the lengthy period of uncertain economic and operating conditions, which coupled with the realization of solid financial results in future periods as anticipated, should allow us to continue to reward shar ...

Wall Street analysts forecast that Mercantile Bank (MBWM) will report quarterly earnings of $1.17 per share in its upcoming release, pointing to a year-over-year decline of 7.9%. It is anticipated that revenues will amount to $56.23 million, exhibiting an increase of 1.9% compared to the year-ago quarter. The current level reflects an upward revision of 1.3% in the consensus EPS estimate for the quarter over the past 30 days. This demonstrates how the analysts covering the stock have collectively reappraise ...

GRAND RAPIDS, Mich., June 27, 2024 /PRNewswire/ -- Mercantile Bank Corporation (NASDAQ: MBWM) will host a conference call and webcast at 10 a.m. ET on Tuesday, July 16, 2024, to discuss second quarter 2024 financial results. SOURCE Mercantile Bank Corporation Participants may access the live conference call on July 16, 2024, at 10 a.m. ET (9 a.m. CT) by dialing 1-844- 868-8844 and requesting the "Mercantile Bank Corporation Call." Please dial in approximately 10 minutes prior to the call. The conference cal ...

Core Points - Mercantile Bank Corporation has implemented a management succession plan, effective June 1, 2024, resulting in key leadership changes [1][2][3] Group 1: Leadership Changes - Robert B. Kaminski, Jr. has retired as President and CEO of Mercantile Bank Corporation and its subsidiary, Mercantile Bank, but remains a Director [1] - Raymond E. Reitsma has been appointed as the new President and CEO of Mercantile Bank Corporation and CEO of the Bank, having a 20-year tenure with the Bank and previously serving in various leadership roles [2] - Scott P. Setlock has been appointed as EVP, COO, and Secretary of Mercantile Bank Corporation, continuing his role as EVP and COO of the Bank [3] Group 2: Company Overview - Mercantile Bank Corporation, based in Grand Rapids, Michigan, is a bank holding company with approximately $5.5 billion in assets, providing financial products and services to businesses, individuals, and governmental units [4]