• Independent Bank Corporation Reports 2022 Second Quarter Results

    Source: Nasdaq GlobeNewswire / 26 Jul 2022 06:59:14   America/Chicago

    GRAND RAPIDS, Mich., July 26, 2022 (GLOBE NEWSWIRE) -- Independent Bank Corporation (NASDAQ: IBCP) reported second quarter 2022 net income of $13.0 million, or $0.61 per diluted share, versus net income of $12.4 million, or $0.56 per diluted share, in the prior- year period. For the six months ended June 30, 2022, the Company reported net income of $31.0 million, or $1.45 per diluted share, compared to net income of $34.4 million, or $1.56 per diluted share, in the prior-year period.

    William B. (“Brad”) Kessel, the President and Chief Executive Officer of Independent Bank Corporation, commented: “I am pleased with our second quarter 2022 performance in which we generated strong core results with $3.1 million growth in net interest income, a 26 basis point expansion of our net interest margin on a linked quarter basis, and net growth in each category of loans and as well as growth in total deposits. In addition, our asset quality metrics continue to be very good, with a low level of past dues, low level of commercial watch credits, low level of non-performing assets, net loan recoveries for the quarter, and an allowance for credit losses to total loans of 1.47%. As we head into the second half of 2022, our focus will continue to be on the rotation of our earning asset mix out of lower yielding investments into higher yielding loans, growing our deposit base while managing our costs of funds, and controlling our expenses. While there exists much uncertainty in the marketplace, we are excited about the momentum we have in our markets and look forward to continuing these growth trends for the remainder of 2022.”

    Highlights for the second quarter of 2022 include:

    • Increases in net income and diluted earnings per share of 4.9% and 8.9%, respectively, over the second quarter of 2021;
    • Net growth in portfolio loans of $254.8 million (or 34.0% annualized);
    • Annualized return on average assets and average equity of 1.10% and 15.68%, respectively;
    • An increase in net interest income of 14.9% over the second quarter of 2021;
    • Continued strong asset quality metrics as evidenced by net loan recoveries during the quarter as well as a low level of non-performing loans and non-performing assets; and
    • The payment of a 22 cent per share dividend on common stock on May 16, 2022.

    Highlights for the first six months of 2022 include:

    • Annualized return on average assets and average equity of 1.32% and 17.63%, respectively;
    • An increase in net interest income of $7.4 million or 12.0% over the first six months of 2021;
    • Net growth in portfolio loans of $353.8 million (or 24.6% annualized); and
    • Net growth in deposits, excluding brokered time deposits, of $136.4 million (or 6.7% annualized).

    Significant items impacting comparable 2022 and 2021 results include the following:

    • Changes in the fair value due to price of capitalized mortgage loan servicing rights (the “MSR Changes”) of $3.1 million ($0.12 per diluted share, after taxes) and $11.6 million ($0.43 per diluted share, after taxes) for the three- and six-months ended June 30, 2022, respectively, as compared to a negative $2.4 million ($0.09 per diluted share, after taxes) and a positive $2.2 million ($0.08 per diluted share, after taxes) for the three- and six-months ended June 30, 2021, respectively.
    • Gain on sale of a branch facility in other income of $0.9 million dollars during the three- and six- months ended June 30, 2022.
    • The provision for credit losses was an expense of $2.4 million in the second quarter of 2022 compared to a credit of $1.4 million in the second quarter of 2021.
    • Net gains on mortgage loans was $1.3 million in the second quarter of 2022 compared to $9.1 million in the second quarter of 2021.

    Operating Results

    The Company’s net interest income totaled $36.1 million during the second quarter of 2022, an increase of $4.7 million, or 14.9% from the year-ago period, and up $3.1 million, or 9.3%, from the first quarter of 2022. The Company’s tax equivalent net interest income as a percent of average interest-earning assets (the “net interest margin”) was 3.26% during the second quarter of 2022, compared to 3.02% in the year-ago period, and 3.00% in the first quarter of 2022. The year-over-year quarterly increase in net interest income was due to an increase in average interest-earning assets and an increase in the net interest margin. Average interest-earning assets were $4.49 billion in the second quarter of 2022, compared to $4.22 billion in the year ago quarter and $4.49 billion in the first quarter of 2022.

    For the first six months of 2022, net interest income totaled $69.1 million, an increase of $7.4 million, or 12.0% from the first six months in 2021. The Company’s net interest margin for the first six months of 2022 was 3.13% compared to 3.04% in 2021. The increase in net interest income for the first six months of 2022 compared to 2021 was also due to an increase in average interest- earning assets and an increase in the net interest margin.

    Non-interest income totaled $14.6 million and $33.6 million, respectively, for the second quarter and first six months of 2022, compared to $14.8 million and $41.2 million in the respective comparable year ago periods. These changes were primarily due to variances in mortgage banking related revenues (net gains on mortgage loans and mortgage loan servicing, net).

    Net gains on mortgage loans in the second quarters of 2022 and 2021, were approximately $1.3 million and $9.1 million, respectively. For the first six months of 2022, net gains on mortgage loans totaled $2.1 million compared to $21.9 million in 2021. The decrease in net gains on mortgage loans was primarily due to lower profit margins on mortgage loan sales, a decrease in the volume of mortgage loans sold and fair value adjustments on the mortgage loan pipeline.

    Mortgage loan servicing, net, generated income of $4.2 million and expense of $2.0 million in the second quarters of 2022 and 2021, respectively. For the first six months of 2022 and 2021, mortgage loan servicing, net, generated income of $13.8 million and $3.2 million, respectively. The significant variances in mortgage loan servicing, net is primarily due to changes in the fair value of capitalized mortgage loan servicing rights associated with changes in mortgage loan interest rates and expected future prepayment levels. Mortgage loan servicing, net activity is summarized in the following table:

      Three months ended Six months ended
      6/30/2022 6/30/2021 6/30/2022 6/30/2021
                     
      (In thousands)
    Mortgage loan servicing, net:        
    Revenue, net $2,124  $1,876  $4,207  $3,786 
    Fair value change due to price  3,120   (2,426)  11,572   2,214 
    Fair value change due to pay-downs  (1,082)  (1,412)  (1,976)  (2,795)
    Total $4,162  $(1,962) $13,803  $3,205 
             

    Net gains (losses) on securities available for sale totaled a loss of $0.3 million in the second quarter of 2022, compared to zero in the prior year second quarter. The loss during the second quarter of 2022 was generally attributed to the divestiture of a group of securities as part of a balance sheet management strategy.

    Other income in the second quarters of 2022 and 2021, was $3.0 million and $1.9 million, respectively. The increase in other income was primarily attributed to the divestiture of bank real estate.

    Non-interest expenses totaled $32.4 million in the second quarter of 2022, compared to $32.5 million in the year-ago period. For the first six months of 2022, non-interest expenses totaled $63.9 million versus $62.6 million in 2021. The year-to-date increases in non-interest expense are primarily due to increases in compensation and employee benefits and advertising that were partially offset by a decrease in conversion related expenses. The increase in compensation and employee benefits in 2022 is due to several factors including, wage increases that were generally effective at the start of the year, a decreased level of compensation that was deferred as direct origination costs (due to lower mortgage loan origination volume), an increase in commercial lending personnel and higher health care insurance costs.

    The Company recorded an income tax expense of $2.9 million and $7.0 million in the second quarter and first six months of 2022, respectively. This compares to an income tax expense of $2.7 million and $7.8 million in the second quarter and first six months of 2021, respectively. The changes in income tax expense principally reflect changes in pre-tax earnings in 2022 relative to 2021.

    Asset Quality

    A breakdown of non-performing loans(1) by loan type is as follows:

     6/30/2022 12/31/2021  6/30/2021
                
    Loan Type(Dollars in thousands)
    Commercial$56  $62  $242 
    Mortgage 5,074   4,914   4,941 
    Installment 729   569   362 
    Sub total 5,859   5,545   5,545 
    Less - government guaranteed loans 1,360   435   427 
    Total non-performing loans$4,499  $5,110  $5,118 
    Ratio of non-performing loans to total portfolio loans 0.14%  0.18%  0.18%
    Ratio of non-performing assets to total assets 0.10%  0.11%  0.12%
    Ratio of allowance for credit losses to total non-performing loans 1064.30%  924.70%  897.34%
          
    (1) Excludes loans that are classified as “troubled debt restructured” that are still performing.

    The provision for credit losses was an expense of $2.4 million and a credit of $1.4 million in the second quarters of 2022 and 2021, respectively. The provision for credit losses was an expense of $0.8 million and a credit of $1.9 million in the first six months of 2022 and 2021, respectively. The quarterly increase in the provision for credit losses in 2022 compared to 2021, was primarily the result of increases in pooled reserve allocations and the adjustment to allocations based on subjective factors due in part to loan portfolio growth. The year-to-date increase in the provision for credit losses in 2022 compared to 2021, was primarily the result of an increase in the adjustment to allocations based on the pooled reserves due in part to loan growth that was partially offset by a decrease in the adjustment to subjective factors due in part to expected reduction in risk related to COVID-19. The Company recorded loan net recoveries of $0.04 million and loan net recoveries of $0.60 million in the second quarters of 2022 and 2021, respectively. At June 30, 2022, the allowance for credit losses totaled $47.9 million, or 1.47% of total portfolio loans compared to $47.3 million, or 1.63% of total portfolio loans at December 31, 2021.

    Balance Sheet, Liquidity and Capital

    Total assets were $4.83 billion at June 30, 2022, an increase of $121.5 million from December 31, 2021. Loans, excluding loans held for sale, were $3.26 billion at June 30, 2022, compared to $2.91 billion at December 31, 2021. Deposits totaled $4.29 billion at June 30, 2022, an increase of $173.5 million from December 31, 2021. This increase is primarily due to growth in non-interest bearing, interest-bearing checking, reciprocal and brokered time deposit account balances.

    Cash and cash equivalents totaled $59.5 million at June 30, 2022, versus $109.5 million at December 31, 2021. Securities available for sale (“AFS”) totaled $859.7 million at June 30, 2022, versus $1.41 billion at December 31, 2021. The decrease in securities AFS is primarily due to the transfer of $391.6 million of securities AFS to held to maturity on April 1, 2022.

    Total shareholders’ equity was $331.1 million at June 30, 2022, or 6.86% of total assets compared to $398.5 million or 8.47% at December 31, 2021. Tangible common equity totaled $300.0 million at June 30, 2022, or $14.25 per share compared to $366.8 million or $17.33 per share at December 31, 2021. The decrease in shareholder equity as well as tangible common equity are primarily the result of a decline in accumulated other comprehensive income (loss) related to unrealized losses on securities available for sale. The Company’s wholly owned subsidiary, Independent Bank, remains significantly above “well capitalized” for regulatory purposes with the following ratios:

         Well
         Capitalized
    Regulatory Capital Ratios6/30/2022 12/31/2021 Minimum
             
    Tier 1 capital to average total assets8.49% 8.57% 5.00%
    Tier 1 common equity to risk-weighted assets11.02% 11.80% 6.50%
    Tier 1 capital to risk-weighted assets11.02% 11.80% 8.00%
    Total capital to risk-weighted assets12.26% 13.05% 10.00%

    Share Repurchase Plan

    On December 18, 2021, the Board of Directors of the Company authorized the 2022 share repurchase plan. Under the terms of the 2022 share repurchase plan, the Company is authorized to purchase up to 1,100,000 shares, or approximately 5% of its then outstanding common stock. The repurchase plan is authorized to last through December 31, 2022. For the first six months of 2022, the Company repurchased 181,586 shares at a weighted average price of $22.08 per share.

    Earnings Conference Call

    Brad Kessel, President and CEO, Gavin A. Mohr, CFO and Joel Rahn, EVP – Commercial Banking will review the quarterly results in a conference call for investors and analysts beginning at 11:00 am ET on Tuesday, July 26, 2022.

    To participate in the live conference call, please dial 1-844-200-6205 (Access Code # 397649). Also, the conference call will be accessible through an audio webcast with user-controlled slides via the following site/URL: https://events.q4inc.com/attendee/739908773

    A playback of the call can be accessed by dialing 1-866-813-9403 (Access Code # 656335). The replay will be available through August 2, 2022.

    About Independent Bank Corporation

    Independent Bank Corporation (NASDAQ: IBCP) is a Michigan-based bank holding company with total assets of approximately $4.8 billion. Founded as First National Bank of Ionia in 1864, Independent Bank Corporation operates a branch network across Michigan's Lower Peninsula through one state-chartered bank subsidiary. This subsidiary (Independent Bank) provides a full range of financial services, including commercial banking, mortgage lending, investments and insurance. Independent Bank Corporation is committed to providing exceptional personal service and value to its customers, stockholders and the communities it serves.

    For more information, please visit our Web site at: IndependentBank.com.

    Forward-Looking Statements

    This press release contains forward-looking statements about Independent Bank Corporation. Statements that are not historical or current facts, including statements about beliefs and expectations, are forward-looking statements and are based on the information available to, and assumptions and estimates made by, management as of the date hereof. These forward-looking statements cover, among other things, anticipated future revenue and expenses and the future plans and prospects of Independent Bank Corporation. Forward-looking statements involve inherent risks and uncertainties, and important factors could cause actual results to differ materially from those anticipated. The COVID-19 pandemic is adversely affecting Independent Bank Corporation, its customers, counterparties, employees, and second-party service providers, and the ultimate extent of the impacts on its business, financial position, results of operations, liquidity, and prospects is uncertain. Continued deterioration in general business and economic conditions or turbulence in domestic or global financial markets could adversely affect Independent Bank Corporation’s revenues and the values of its assets and liabilities, reduce the availability of funding from certain financial institutions, lead to a tightening of credit, and increase stock price volatility. In addition, changes to statutes, regulations, or regulatory policies or practices could affect Independent Bank Corporation in substantial and unpredictable ways. Independent Bank Corporation’s results could also be adversely affected by changes in interest rates; further increases in unemployment rates; deterioration in the credit quality of its loan portfolios or in the value of the collateral securing those loans; deterioration in the value of its investment securities; legal and regulatory developments; litigation; increased competition from both banks and non-banks; changes in the level of tariffs and other trade policies of the United States and its global trading partners; changes in customer behavior and preferences; breaches in data security; failures to safeguard personal information; effects of mergers and acquisitions and related integration; effects of critical accounting policies and judgments; and management’s ability to effectively manage credit risk, market risk, operational risk, compliance risk, strategic risk, interest rate risk, liquidity risk and reputation risk.

    Certain risks and important factors that could affect Independent Bank Corporation's future results are identified in its Annual Report on Form 10-K for the year ended December 31, 2021 and other reports filed with the SEC, including among other things under the heading “Risk Factors” in such Annual Report on Form 10-K. Any forward- looking statement speaks only as of the date on which it is made, and Independent Bank Corporation undertakes no obligation to update any forward-looking statement, whether to reflect events or circumstances, after the date on which the statement is made, to reflect new information or the occurrence of unanticipated events, or otherwise.

     
    INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
    Consolidated Statements of Financial Condition
      June 30, December 31,
       2022   2021 
      (unaudited)
      (In thousands, except share
      amounts)
    Assets
    Cash and due from banks $56,516  $51,069 
    Interest bearing deposits  2,970   58,404 
    Cash and Cash Equivalents  59,486   109,473 
    Securities available for sale  859,704   1,412,830 
    Securities held to maturity (fair value of $359,701 at June 30, 2022 and    
    zero at December 31, 2021)  381,608   - 
    Federal Home Loan Bank and Federal Reserve Bank stock, at cost  17,653   18,427 
    Loans held for sale, carried at fair value  31,400   55,470 
    Loans held for sale, carried at lower of cost or fair value  -   34,811 
    Loans    
    Commercial  1,329,198   1,203,581 
    Mortgage  1,284,169   1,139,659 
    Installment  645,483   561,805 
    Total Loans  3,258,850   2,905,045 
    Allowance for credit losses  (47,883)  (47,252)
    Net Loans  3,210,967   2,857,793 
    Other real estate and repossessed assets  508   245 
    Property and equipment, net  36,148   36,404 
    Bank-owned life insurance  55,088   55,279 
    Capitalized mortgage loan servicing rights, carried at fair value  39,477   26,232 
    Other intangibles  2,871   3,336 
    Goodwill  28,300   28,300 
    Accrued income and other assets  102,999   66,140 
    Total Assets $4,826,209  $4,704,740 
         
    Liabilities and Shareholders' Equity
    Deposits    
    Non-interest bearing $1,357,824  $1,321,601 
    Savings and interest-bearing checking  1,961,124   1,897,487 
    Reciprocal  615,204   586,626 
    Time  316,425   308,438 
    Brokered time  39,997   2,938 
    Total Deposits  4,290,574   4,117,090 
    Other borrowings  25,507   30,009 
    Subordinated debt  39,395   39,357 
    Subordinated debentures  39,626   39,592 
    Accrued expenses and other liabilities  99,973   80,208 
    Total Liabilities  4,495,075   4,306,256 
         
    Shareholders’ Equity    
    Preferred stock, no par value, 200,000 shares authorized; none issued or outstanding  -   - 
    Common stock, no par value, 500,000,000 shares authorized; issued and outstanding:    
    21,049,218 shares at June 30, 2022 and 21,171,036 shares at December 31, 2021  319,885   323,401 
    Retained earnings  96,252   74,582 
    Accumulated other comprehensive income (loss)  (85,003)  501 
    Total Shareholders’ Equity  331,134   398,484 
    Total Liabilities and Shareholders’ Equity $4,826,209  $4,704,740 
         


    INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
    Consolidated Statements of Operations
               
      Three Months Ended Six Months Ended
      June 30, March 31, June 30, June 30,
       2022   2022   2021   2022   2021 
                         
      (unaudited)
    Interest Income (In thousands, except per share amounts)
    Interest and fees on loans $31,454  $28,418  $28,091  $59,872  $56,196 
    Interest on securities          
    Taxable  4,950   4,552   3,656   9,502   6,452 
    Tax-exempt  1,746   1,554   1,544   3,300   2,928 
    Other investments  214   217   208   431   425 
    Total Interest Income  38,364   34,741   33,499   73,105   66,001 
    Interest Expense          
    Deposits  1,216   767   1,142   1,983   2,398 
    Other borrowings and subordinated debt and debentures  1,087   973   964   2,060   1,926 
    Total Interest Expense  2,303   1,740   2,106   4,043   4,324 
    Net Interest Income  36,061   33,001   31,393   69,062   61,677 
    Provision for credit losses  2,379   (1,573)  (1,425)  806   (1,899)
    Net Interest Income After Provision for Credit Losses  33,682   34,574   32,818   68,256   63,576 
    Non-interest Income          
    Interchange income  3,422   3,082   3,453   6,504   6,502 
    Service charges on deposit accounts  3,096   2,957   2,318   6,053   4,234 
    Net gains (losses) on assets          
    Mortgage loans  1,253   835   9,091   2,088   21,919 
    Securities available for sale  (345)  70   -   (275)  1,416 
    Mortgage loan servicing, net  4,162   9,641   (1,962)  13,803   3,205 
    Other  3,044   2,363   1,871   5,407   3,901 
    Total Non-interest Income  14,632   18,948   14,771   33,580   41,177 
    Non-interest Expense          
    Compensation and employee benefits  19,882   20,130   19,883   40,012   38,405 
    Data processing  2,644   2,216   2,576   4,860   4,950 
    Occupancy, net  2,077   2,543   2,153   4,620   4,496 
    Interchange expense  1,262   1,011   1,201   2,273   2,149 
    Furniture, fixtures and equipment  1,042   1,045   1,034   2,087   2,037 
    Communications  762   757   777   1,519   1,658 
    Advertising  560   680   164   1,240   653 
    Loan and collection  647   559   859   1,206   1,618 
    FDIC deposit insurance  457   522   307   979   637 
    Legal and professional  479   493   522   972   1,021 
    Costs (recoveries) related to unfunded lending commitments  649   (355)  26   294   (6)
    Conversion related expenses  6   44   1,143   50   1,361 
    Net (gains) losses on other real estate and repossessed assets  (141)  (55)  6   (196)  (174)
    Other  2,108   1,860   1,885   3,968   3,752 
    Total Non-interest Expense  32,434   31,450   32,536   63,884   62,557 
    Income Before Income Tax  15,880   22,072   15,053   37,952   42,196 
    Income tax expense  2,879   4,105   2,665   6,984   7,771 
    Net Income $13,001  $17,967  $12,388  $30,968  $34,425 
    Net Income Per Common Share          
    Basic $0.62  $0.85  $0.57  $1.47  $1.58 
    Diluted $0.61  $0.84  $0.56  $1.45  $1.56 
               


    INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
    Selected Financial Data
               
     June 30, March 31, December 31,September 30,June 30, 
     2022  2022  2021  2021   2021  
                       
     (unaudited) 
     (Dollars in thousands except per share data)
    Three Months Ended          
    Net interest income$36,061 $33,001  $34,285 $33,803  $31,393  
    Provision for credit losses 2,379  (1,573)  630  (659)  (1,425) 
    Non-interest income 14,632  18,948   15,771  19,695   14,771  
    Non-interest expense 32,434  31,450   33,954  34,512   32,536  
    Income before income tax 15,880  22,072   15,472  19,645   15,053  
    Income tax expense 2,879  4,105   2,964  3,683   2,665  
    Net income$13,001 $17,967  $12,508 $15,962  $12,388  
               
    Basic earnings per share$0.62 $0.85  $0.59 $0.74  $0.57  
    Diluted earnings per share 0.61  0.84   0.58  0.73   0.56  
    Cash dividend per share 0.22  0.22   0.21  0.21   0.21  
               
    Average shares outstanding 21,070,266  21,191,860   21,256,367  21,515,669   21,749,654  
    Average diluted shares outstanding 21,266,476  21,398,128   21,473,963  21,726,346   21,966,829  
               
    Performance Ratios          
    Return on average assets 1.10% 1.54 % 1.07% 1.40 % 1.12 %
    Return on average equity 15.68  19.38   12.61  15.93   12.78  
    Efficiency ratio(1) 62.50  59.62   66.68  63.47   69.24  
               
    As a Percent of Average Interest-Earning Assets(1)         
    Interest income 3.47% 3.16 % 3.30% 3.37 % 3.22 %
    Interest expense 0.21  0.16   0.17  0.19   0.20  
    Net interest income 3.26  3.00   3.13  3.18   3.02  
               
    Average Balances          
    Loans$3,145,095 $2,980,098  $2,957,985 $2,903,700  $2,859,544  
    Securities 1,312,934  1,407,225   1,367,038  1,317,382   1,274,556  
    Total earning assets 4,493,714  4,492,757   4,433,400  4,296,662   4,223,570  
    Total assets 4,758,960  4,721,205   4,654,491  4,513,774   4,434,760  
    Deposits 4,221,047  4,158,528   4,069,901  3,934,937   3,879,715  
    Interest bearing liabilities 3,005,103  2,950,337   2,863,057  2,740,444   2,674,425  
    Shareholders' equity 332,610  376,010   393,477  397,542   388,780  
               
    End of Period          
    Capital          
    Tangible common equity ratio 6.26% 6.85 % 7.85% 8.02 % 8.21 %
    Average equity to average assets 6.99  7.96   8.45  8.81   8.77  
    Common shareholders' equity per share         
    of common stock$15.73 $16.79  $18.82 $18.76  $18.30  
    Tangible common equity per share          
    of common stock 14.25  15.31   17.33  17.27   16.82  
    Total shares outstanding 21,049,218  21,168,230   21,171,036  21,321,092   21,632,912  
               
    Selected Balances          
    Loans$3,258,850 $3,004,065  $2,905,045 $2,883,978  $2,814,559  
    Securities 1,241,312  1,400,137   1,412,830  1,348,378   1,330,660  
    Total earning assets 4,170,577  4,514,590   4,484,987  4,405,189   4,246,410  
    Total assets 4,826,209  4,761,983   4,704,740  4,622,340   4,461,272  
    Deposits 4,290,574  4,205,498   4,117,090  4,012,068   3,862,466  
    Interest bearing liabilities 2,997,883  2,956,736   2,865,090  2,784,554   2,633,747  
    Shareholders' equity 331,134  355,449   398,484  400,031   395,974  
               
    (1) Presented on a fully tax equivalent basis assuming a marginal tax rate of 21%.     
          

    Reconciliation of Non-GAAP Financial Measures
    Independent Bank Corporation

    Independent Bank Corporation believes non-GAAP measures are meaningful because they reflect adjustments commonly made by management, investors, regulators and analysts to evaluate the adequacy of common equity and performance trends. Tangible common equity is used by the Company to measure the quality of capital.

    Reconciliation of Non-GAAP Financial Measures        
      Three Months Ended Six Months Ended
      June 30, June 30,
       2022   2021   2022   2021 
            
      (Dollars in thousands)   
    Net Interest Margin, Fully Taxable        
    Equivalent ("FTE")        
             
    Net interest income $36,061  $31,393  $69,062  $61,677 
    Add: taxable equivalent adjustment  481   478   963   882 
    Net interest income - taxable equivalent $36,542  $31,871  $70,025  $62,559 
    Net interest margin (GAAP)(1)  3.21%  2.98%  3.09%  3.00%
    Net interest margin (FTE)(1)  3.26%  3.02%  3.13%  3.04%
             
    (1) Annualized.        


    Tangible Common Equity Ratio         
     June 30, March 31, December 31,September 30,June 30,
      2022   2022   2021   2021   2021 
     (Dollars in thousands)
    Common shareholders' equity$331,134  $355,449  $398,484  $400,031  $395,974 
    Less:         
    Goodwill 28,300   28,300   28,300   28,300   28,300 
    Other intangibles 2,871   3,104   3,336   3,579   3,821 
    Tangible common equity$299,963  $324,045  $366,848  $368,152  $363,853 
              
    Total assets$4,826,209  $4,761,983  $4,704,740  $4,622,340  $4,461,272 
    Less:         
    Goodwill 28,300   28,300   28,300   28,300   28,300 
    Other intangibles 2,871   3,104   3,336   3,579   3,821 
    Tangible assets$4,795,038  $4,730,579  $4,673,104  $4,590,461  $4,429,151 
              
    Common equity ratio 6.86%  7.46%  8.47%  8.65%  8.88%
    Tangible common equity ratio 6.26%  6.85%  7.85%  8.02%  8.21%
              
    Tangible Common Equity per Share of Common Stock:      
              
    Common shareholders' equity$331,134  $355,449  $398,484  $400,031  $395,974 
    Tangible common equity$299,963  $324,045  $366,848  $368,152  $363,853 
    Shares of common stock         
    outstanding (in thousands) 21,049   21,168   21,171   21,321   21,633 
              
    Common shareholders' equity per share         
    of common stock$15.73  $16.79  $18.82  $18.76  $18.30 
    Tangible common equity per share         
    of common stock$14.25  $15.31  $17.33  $17.27  $16.82 
              

    The tangible common equity ratio removes the effect of goodwill and other intangible assets from capital and total assets. Tangible common equity per share of common stock removes the effect of goodwill and other intangible assets from common shareholders’ equity per share of common stock.

    Contact:William B. Kessel, President and CEO, 616.447.3933
     Gavin A. Mohr, Chief Financial Officer, 616.447.3929

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