Interest Rate Risk - The company has identified interest rate risk as a primary source of market risk, affecting earnings and asset values [472]. - The Asset-Liability Committee (ALCO) meets quarterly to monitor interest rate risk sensitivity and ensure compliance with risk limits [474]. - The company utilizes two approaches to model interest rate risk: Net Interest Income at Risk (NII at Risk) and Economic Value of Equity (EVE) [479]. Net Interest Income Sensitivity - As of September 30, 2025, the net interest income sensitivity for a +200 basis point shift is projected to increase by $89,216 thousand, representing a 15.8% change [480]. - The company reported a dollar change in net interest income sensitivity of $(85,985) thousand for a -200 basis point shift as of September 30, 2025, reflecting a 15.3% decrease [480]. - The company aims to limit the change in net interest income to 20% for a +/- 100 basis point move in interest rates and 30% for a +/- 200 basis point move [480]. Equity and Tangible Book Value - Total equity as of September 30, 2025, is reported at $2,225,434 thousand, up from $1,939,107 thousand in 2024 [488]. - Tangible common shareholders' equity increased to $1,666,087 thousand in 2025 from $1,481,641 thousand in 2024 [488]. - The tangible book value per common share increased to $36.31 in 2025 from $32.38 in 2024 [488]. Economic Value of Equity - The economic value of equity (EVE) is expected to increase by $48,147 thousand (2.3%) with an immediate -200 basis point shift in interest rates as of September 30, 2025 [485].
Merchants Bancorp(MBINL) - 2025 Q3 - Quarterly Report