Macatawa Bank(US:MCBC)2024-04-25 20:33Financial Performance - Net income for Q1 2024 was $9.8 million, a decrease from $12.0 million in Q1 2023, but an increase from $9.5 million in Q4 2023[3] - Net interest income for Q1 2024 totaled $20.7 million, a decrease of $1.9 million from Q1 2023[6] - Net income for Q1 2024 was $9,793 million, an increase of 3.2% from $9,495 million in Q4 2023 but a decrease of 18.3% from $12,004 million in Q1 2023[39] - Basic earnings per common share for Q1 2024 was $0.29, unchanged from Q4 2023 and down from $0.35 in Q1 2023[39] - Total non-interest income for Q1 2024 was $4,660 million, slightly down from $4,684 million in Q4 2023 but up from $4,528 million in Q1 2023[39] - Total non-interest expense for Q1 2024 was $13,245 million, a decrease from $13,964 million in Q4 2023 and an increase from $12,165 million in Q1 2023[39] - Efficiency ratio for Q1 2024 improved to 52.17% from 53.45% in Q4 2023 but was higher than 44.82% in Q1 2023[39] Asset and Loan Growth - Loan portfolio grew by $3.8 million (1.1% annualized growth) in Q1 2024, and by $121.3 million (9.9%) over the last 12 months[5] - Total loans increased to $1.34 billion at March 31, 2024, up $3.8 million from Q4 2023 and $121.3 million from Q1 2023[20] - Total portfolio loans reached $1,342,208 million in Q1 2024, a slight increase from $1,338,386 million in Q4 2023[43] Asset and Deposit Changes - Total assets decreased to $2.61 billion at March 31, 2024, down $133.8 million from $2.75 billion at December 31, 2023[18] - Total deposits decreased to $2.28 billion as of March 31, 2024, down $131.3 million, or 5.4%, from $2.42 billion at December 31, 2023[23] - Total assets as of March 31, 2024, were $2,614,906 million, a decrease from $2,748,699 million as of December 31, 2023[39] - Total deposits as of March 31, 2024, were $2,284,401 million, down from $2,415,730 million in Q4 2023 and $2,330,895 million in Q1 2023[39] Credit Quality and Allowance - Non-performing loans remained at $1,000, representing 0.00% of total loans as of March 31, 2024[13] - The allowance for credit losses was $17.4 million, representing 1.30% of total loans as of March 31, 2024[12] - The allowance for credit losses was $17,440 million in Q1 2024, slightly up from $17,001 million in Q4 2023[42] Capital and Liquidity - The company's total risk-based regulatory capital ratio remained consistent at levels significantly above the "well capitalized" minimums, with $151.3 million in excess capital[27] - Management maintained a strong liquidity position with $331.4 million in federal funds sold and short-term investments as of March 31, 2024[26] - The company has no brokered deposits on its balance sheet since December 2011, ensuring significant on-balance sheet liquidity[26] - Common equity tier 1 to risk-weighted assets was 18.16% in Q1 2024, up from 17.70% in Q4 2023, indicating stronger capital position[43] Merger and Strategic Initiatives - The company entered into a merger agreement with Wintrust Financial Corporation on April 15, 2024[5] - The planned merger with Wintrust Financial Corporation is expected to provide strategic and financial benefits, although it involves risks and uncertainties[30] - Management's focus on shorter-term bond durations has resulted in $411.0 million in bond maturities and paydowns expected in the next 24 months[26] Deposit Composition - Core deposits represented 100% of total deposits at March 31, 2024, reflecting a $579.0 million increase, or 34%, over pre-pandemic totals of $1.71 billion as of March 31, 2020[24] - Noninterest bearing demand deposits fell by $28.7 million from the end of Q4 2023 and by $76.1 million from Q1 2023[25] - The company continues to attract and retain core local deposit customers, with all certificates of deposit sourced from local customers[25]