• Macatawa Bank Corporation Reports Fourth Quarter and Full Year 2021 Results

    Source: Nasdaq GlobeNewswire / 27 Jan 2022 16:15:01   America/New_York

    HOLLAND, Mich., Jan. 27, 2022 (GLOBE NEWSWIRE) -- Macatawa Bank Corporation (NASDAQ: MCBC), the holding company for Macatawa Bank (collectively, the “Company”), today announced its results for the fourth quarter and full year of 2021.

    • Full year 2021 net income of $29.0 million versus $30.2 million in prior year
    • Net income of $6.2 million in fourth quarter 2021 versus $9.0 million in fourth quarter 2020
    • Decline in fourth quarter 2021 earnings from prior year fourth quarter earnings primarily due to decrease in Paycheck Protection Program ("PPP") loan fees recognized
    • Provision for loan losses benefit of $750,000 in fourth quarter 2021 reflecting improvement in economic conditions
    • Continued expense management discipline – 5% decrease in total noninterest expense from fourth quarter 2020
    • Loan portfolio balances, excluding PPP loans, down for the year but showing growth in the fourth quarter
    • Further growth in deposit balances – up 12% from fourth quarter 2020
    • Grew investment securities portfolio by $174 million in fourth quarter 2021 to strategically deploy excess liquidity
    • Asset-sensitive balance sheet is well-positioned for a rising interest rate environment

    The Company reported net income of $6.2 million, or $0.18 per diluted share, in the fourth quarter 2021 compared to $9.0 million, or $0.26 per diluted share, in the fourth quarter 2020.   For the full year 2021, the Company reported net income of $29.0 million, or $0.85 per diluted share, compared to $30.2 million, or $0.88 per diluted share, for the full year 2020.   

    "We are pleased to report solid results for the fourth quarter of 2021 and for the full year 2021,” said Ronald L. Haan, President and CEO of the Company. “We are encouraged by our commercial loan origination activity and the resulting portfolio growth in the fourth quarter 2021, excluding run-off of PPP loans. Our credit quality remains strong and we had no commercial loan chargeoffs during the fourth quarter 2021, contributing to a provision for loan loss benefit of $750,000 for the quarter. Other fee income including wealth management fees, debit card interchange income and treasury management fees experienced healthy growth, offsetting most of the reduction in mortgage gains for the year while total non-interest expenses were flat for the year and down in the fourth quarter 2021 compared to the same period in the prior year.

    “Through measured growth of our investment portfolio, we accelerated the deployment of excess liquid funds caused by our robust deposit growth. Focusing on short-term, high quality securities, we grew our investment portfolio by $174.0 million in the fourth quarter 2021.”

    Mr. Haan concluded: "Despite a challenging environment, we produced strong earnings for the fourth quarter of 2021 and for the year. Our asset quality is strong and as we have managed our balance sheet to be asset-sensitive, we are very well-positioned to benefit from the rising interest rate environment that we expect in 2022. We look forward to building on our fourth quarter momentum and seizing more opportunities to strategically deploy the excess funds our customers have entrusted us with.”

    Operating Results
    Net interest income for the fourth quarter 2021 totaled $12.8 million, a decrease of $1.5 million from the third quarter 2021 and a decrease of $3.7 million from the fourth quarter 2020. Net interest margin for the fourth quarter 2021 was 1.85 percent, down 19 basis points from the third quarter 2021, and down 84 basis points from the fourth quarter 2020. Net interest income for the fourth quarter 2021 reflected amortization of $1.2 million in fees from loans originated under the PPP, compared to $2.8 million in the third quarter 2021 and $3.2 million in the fourth quarter 2020. These fees are amortized over the loans’ contractual maturity, which is 24 months or 60 months, as applicable. Upon SBA forgiveness, the remaining unamortized fees are recognized into interest income. During the fourth quarter 2021, the Company had approved and received forgiveness disbursements from the SBA on 245 loans with balances totaling $36.7 million. In the third quarter 2021, the Company had approved and received forgiveness disbursements from the SBA on 909 loans with balances totaling $92.4 million. Net interest margin was further negatively impacted in the fourth quarter 2021 versus the fourth quarter 2020 by our carrying significantly higher balances of federal funds sold due to the significant increase in balances held by depositors throughout the COVID-19 pandemic. These balances, which earn only 10-15 basis points in interest, increased by $582.4 million, on average, from the fourth quarter 2020 and caused a 49 basis point decrease in net interest margin in the fourth quarter 2021 compared to fourth quarter 2020. Floor rates established by the Company on its variable rate loans over recent years served to soften the negative impact on net interest income of the 2020 federal funds rate decreases. Without these floors, net interest income for the quarter would have been lower than stated by approximately $1.0 million.

    On July 7, 2021, the Company redeemed its remaining $20.0 million of trust preferred securities. The Company estimates that this will save approximately $600,000 of interest expense annually, with regulatory capital remaining significantly above levels required to be categorized as well capitalized.

    Non-interest income decreased $296,000 in the fourth quarter 2021 compared to the third quarter 2021 and decreased $1.7 million from the fourth quarter 2020. Gains on sales of mortgage loans in the fourth quarter 2021 were down $337,000 compared to the third quarter 2021 and were down $1.9 million from the fourth quarter 2020. The Company originated $16.4 million in mortgage loans for sale in the fourth quarter 2021 compared to $21.3 million in the third quarter 2021 and $36.2 million in the fourth quarter 2020. For the full year 2021 non-interest income decreased by only $281,000 despite a decrease in mortgage gains of $1.8 million. Higher deposit service charge income, wealth management fees and debit card interchange income from customer usage softened the effect of a lower level of mortgage gains recognized in the quarter and the full year.  

    Non-interest expense was $11.3 million for the fourth quarter 2021, compared to $11.6 million for the third quarter 2021 and $12.0 million for the fourth quarter 2020. The largest component of non-interest expense was salaries and benefit expenses. Salaries and benefit expenses were down $254,000 compared to the third quarter 2021 and were down $569,000 compared to the fourth quarter 2020. The decreases compared to the third quarter 2021 and the fourth quarter 2020 were due largely to a lower level of commissions from mortgage production as volume decreased and also due to lower medical insurance costs. The table below identifies the primary components of the changes in salaries and benefits between periods.



    Dollars in 000s    		 Q4 2021
    to
    Q3 2021    		 Q4 2021
    to
    Q4 2020    		  
            
    Salaries and other compensation $(149) $(189)  
    Salary deferral from commercial loans  (32)  24   
    Bonus accrual  142   (16)  
    Mortgage production – variable comp  (41)  (221)  
    401k matching contributions  (13)  (80)  
    Medical insurance costs  (161)  (87)  
    Total change in salaries and benefits $(254) $(569)  
               

    FDIC assessment expense was $217,000 in the fourth quarter 2021 compared to $204,000 in the third quarter 2021 and $194,000 in the fourth quarter 2020. FDIC assessment expense increased primarily as a result of the significant increase in deposit balances between periods. Data processing expenses were up $15,000 in the fourth quarter 2021 compared to the third quarter 2021 and were down $194,000 compared to the fourth quarter 2020 due to online banking conversion related expenses incurred in the fourth quarter 2020. Other categories of non-interest expense were relatively flat compared to the third quarter 2021 and the fourth quarter 2020 due to a continued focus on expense management.  

    Federal income tax expense was $1.4 million for the fourth quarter 2021, $1.7 million for the third quarter 2021, and $1.8 million for the fourth quarter 2020. Federal income tax expense for the fourth quarter 2020 benefitted from the reversal of $92,000 deferred tax valuation allowance at the end of 2020. The effective tax rate was 18.0 percent for the fourth quarter 2021, compared to 19.4 percent for the third quarter 2021 and 16.8 percent for the fourth quarter 2020.  

    Asset Quality
    A provision for loan losses benefit of $750,000 was recorded in the fourth quarter 2021 compared to provision benefit of $550,000 in the third quarter 2021 and provision expense of $800,000 in the fourth quarter 2020. Net loan recoveries for the fourth quarter 2021 were $107,000, compared to third quarter 2021 net loan recoveries of $276,000 and fourth quarter 2020 net loan recoveries of $50,000. At December 31, 2021, the Company had experienced net loan recoveries in twenty-six of the past twenty-eight quarters.   Total loans past due on payments by 30 days or more amounted to $129,000 at December 31, 2021, down $308,000 from $437,000 at September 30, 2021 and down $452,000 from $581,000 at December 31, 2020. Delinquencies at December 31, 2021 were comprised of just four individual loans. Delinquency as a percentage of total loans was just 0.01 percent at December 31, 2021, well below the Company’s peer level.

    The allowance for loan losses of $15.9 million was 1.43 percent of total loans at December 31, 2021, compared to $16.5 million or 1.45 percent of total loans at September 30, 2021, and $17.4 million or 1.22 percent at December 31, 2020. The ratio at December 31, 2021, September 30, 2021 and December 31, 2020 includes PPP loans, which are fully guaranteed by the SBA and receive no allowance allocation. The ratio excluding PPP loans was 1.49 percent at December 31, 2021, 1.56 percent at September 30, 2021 and 1.45 percent at December 31, 2020. The coverage ratio of allowance for loan losses to nonperforming loans continued to be strong and significantly exceeded 1-to-1 coverage at 173-to-1 as of December 31, 2021.

    At December 31, 2021, the Company's nonperforming loans were $92,000, representing 0.01 percent of total loans. This compares to $420,000 (0.04 percent of total loans) at September 30, 2021 and $533,000 (0.04 percent of total loans) at December 31, 2020. Other real estate owned and repossessed assets were $2.3 million at December 31, 2021, compared to $2.3 million at September 30, 2021 and $2.5 million at December 31, 2020. Total non-performing assets, including other real estate owned and nonperforming loans, were $2.4 million, or 0.08 percent of total assets, at December 31, 2021. Total nonperforming assets, including other real estate owned and nonperforming loans, decreased by $635,000 from December 31, 2020 to December 31, 2021.

    A break-down of non-performing loans is shown in the table below.


    Dollars in 000s    		 Dec 31,
    2021    		 Sept 30,
    2021    		 June 30,
    2021    		 Mar 31,
    2021    		 Dec 31,
    2020    		 
                    
    Commercial Real Estate $5 $332 $341 $432 $438 
    Commercial and Industrial  1  ---  ---  ---  --- 
    Total Commercial Loans  6  332  341  432  438 
    Residential Mortgage Loans  86  88  92  93  95 
    Consumer Loans  ---  ---  ---  ---  --- 
    Total Non-Performing Loans $92 $420 $433 $525 $533 
                     

    A break-down of non-performing assets is shown in the table below.


    Dollars in 000s    		 Dec 31,
    2021    		 Sept 30,
    2021    		 June 30,
    2021    		 Mar 31,
    2021    		 Dec 31,
    2020    		 
                    
    Non-Performing Loans $92 $420 $433 $525 $533 
    Other Repossessed Assets  ---  ---  ---  ---  --- 
    Other Real Estate Owned  2,343  2,343  2,343  2,371  2,537 
    Total Non-Performing Assets $2,435 $2,763 $2,776 $2,896 $3,070 
                     

    Balance Sheet, Liquidity and Capital

    Total assets were $2.93 billion at December 31, 2021, an increase of $27.3 million from $2.90 billion at September 30, 2021 and an increase of $286.7 million from $2.64 billion at December 31, 2020. Assets were elevated at each period due to customers holding a higher level of deposits during the COVID-19 pandemic, including balances from PPP loan proceeds. Total loans were $1.11 billion at December 31, 2021, a decrease of $27.6 million from $1.14 billion at September 30, 2021 and a decrease of $320.3 million from $1.43 billion at December 31, 2020.

    Commercial loans decreased by $281.2 million from December 31, 2020 to December 31, 2021, along with a decrease of $31.8 million in the residential mortgage portfolio, and a decrease of $7.4 million in the consumer loan portfolio. Within commercial loans, commercial real estate loans decreased by $36.1 million and commercial and industrial loans decreased by $57.0 million. However, the largest decrease in commercial loans was in PPP loans which decreased by $187.1 million due to forgiveness by the SBA, partially offset by new PPP loan originations of $126.9 million. Excluding PPP loans, total commercial loans increased by $10.4 million during the fourth quarter 2021.   

    The composition of the commercial loan portfolio is shown in the table below:



    Dollars in 000s    		 Dec 31,
    2021    		 Sept 30,
    2021    		 June 30,
    2021    		 Mar 31,
    2021    		 Dec 31,
    2020    		 
                    
    Construction and Development $103,755 $104,636 $102,608 $117,178 $118,665 
    Other Commercial Real Estate  412,346  422,574  427,291  423,424  433,508 
    Commercial Loans Secured
    by Real Estate    		  516,101  527,210  529,899  540,602  552,173 
    Commercial and Industrial  378,318  356,812  359,846  392,208  436,331 
    Paycheck Protection Program  41,939  77,571  169,679  253,811  229,079 
    Total Commercial Loans $936,358 $961,593 $1,059,424 $1,186,621 $1,217,583 
                     

    Bank owned life insurance was $52.5 million at December 31, 2021, down $313,000 from $52.8 million at September 30, 2021 and up $10.0 million from $42.5 million at December 31, 2020 due to an additional $10.0 million in insurance policies purchased early in the second quarter 2021 and earnings on the underlying investments.

    Total deposits were $2.58 billion at December 31, 2021, up $24.8 million, or 1.0 percent, from $2.55 billion at September 30, 2021 and up $279.4 million, or 12.2 percent, from $2.30 billion at December 31, 2020. Demand deposits were down $18.0 million in the fourth quarter 2021 compared to the third quarter 2021 and were up $170.3 million compared to the fourth quarter 2020. Money market deposits and savings deposits were up $47.3 million from the third quarter 2021 and were up $122.9 million from the fourth quarter 2020. Certificates of deposit were down $4.5 million at December 31, 2021 compared to September 30, 2021 and were down $13.8 million compared to December 31, 2020 as customers reacted to changes in market interest rates. As deposit rates have dropped, the Company has experienced some shifting between deposit types and, overall, deposit customers are holding higher levels of liquid deposit balances in the low interest rate environment and due to uncertainty related to the COVID-19 pandemic. The Company continues to be successful at attracting and retaining core deposit customers. Customer deposit accounts remain insured to the highest levels available under FDIC deposit insurance.

    Other borrowed funds of $85.0 million at December 31, 2021 were unchanged compared to $85.0 million at September 30, 2021 and were up $15.0 million compared to $70.0 million at December 31, 2020. The increases were due to an additional $25.0 million advance taken in the third quarter 2021. This advance is putable quarterly by the FHLB and carries a rate of 0.01%. Considering the additional dividend provided by the FHLB on activity based stock, this advance effectively carries a negative interest rate, resulting in positive income for the Company from the advance. The put option on this advance was executed by the FHLB and the advance was repaid in full on January 21, 2022.

    The Company's total risk-based regulatory capital ratio at December 31, 2021 was consistent with the ratio at December 31, 2020 despite the redemption of the remaining trust preferred securities in the third quarter 2021. Macatawa Bank’s risk-based regulatory capital ratios continue to be at levels considerably above those required to be categorized as “well capitalized” under applicable regulatory capital guidelines. As such, the Bank was categorized as "well capitalized" at December 31, 2021.

    About Macatawa Bank
    Headquartered in Holland, Michigan, Macatawa Bank offers a full range of banking, retail and commercial lending, wealth management and ecommerce services to individuals, businesses and governmental entities from a network of 26 full-service branches located throughout communities in Kent, Ottawa and northern Allegan counties. The bank is recognized for its local management team and decision making, along with providing customers excellent service, a rewarding experience and superior financial products. Macatawa Bank has been recognized for ten years as “West Michigan’s 101 Best and Brightest Companies to Work For”. For more information, visit www.macatawabank.com.

    CAUTIONARY STATEMENT: This press release contains forward-looking statements that are based on management's current beliefs, expectations, assumptions, estimates, plans and intentions. Forward-looking statements are identifiable by words or phrases such as “anticipates,” "believe," "expect," "may," "should," "will," ”intend,” "continue," "improving," "additional," "focus," "forward," "future," "efforts," "strategy," "momentum," "positioned," and other similar words or phrases. Such statements are based upon current beliefs and expectations and involve substantial risks and uncertainties which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These statements include, among others, statements related to risks and uncertainties related to, and the impact of, the global coronavirus (COVID-19) pandemic on the business, financial condition and results of operations of our company and our customers, trends in our key operating metrics and financial performance, future levels of earnings and profitability, future levels of earning assets, future asset quality, future growth, and future net interest margin. All statements with references to future time periods are forward-looking. Management's determination of the provision and allowance for loan losses, the appropriate carrying value of intangible assets (including deferred tax assets) and other real estate owned and the fair value of investment securities (including whether any impairment on any investment security is temporary or other-than-temporary and the amount of any impairment) involves judgments that are inherently forward-looking. Our ability to sell other real estate owned at its carrying value or at all, reduce non-performing asset expenses, utilize our deferred tax asset, successfully implement new programs and initiatives, increase efficiencies, maintain our current level of deposits and other sources of funding, maintain liquidity, respond to declines in collateral values and credit quality, improve profitability, and produce consistent core earnings is not entirely within our control and is not assured. The future effect of changes in the real estate, financial and credit markets and the national and regional economy on the banking industry, generally, and Macatawa Bank Corporation, specifically, are also inherently uncertain. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions ("risk factors") that are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. Therefore, actual results and outcomes may materially differ from what may be expressed in or implied by such forward-looking statements. Macatawa Bank Corporation does not undertake to update forward-looking statements to reflect the impact of circumstances or events that may arise after the date of the forward-looking statements.

    Risk factors include, but are not limited to, the risk factors described in "Item 1A - Risk Factors" of our Annual Report on Form 10-K for the year ended December 31, 2020. These and other factors are representative of the risk factors that may emerge and could cause a difference between an ultimate actual outcome and a preceding forward-looking statement.

     
     
    MACATAWA BANK CORPORATION
    CONSOLIDATED FINANCIAL SUMMARY
    (Unaudited)
    (Dollars in thousands except per share information)
                   
          Quarterly Twelve Months Ended
          4th Qtr 3rd Qtr 4th Qtr December 31
    EARNINGS SUMMARY      2021   2021   2020   2021   2020 
    Total interest income     $13,334  $14,842  $17,401  $58,634  $67,224 
    Total interest expense      508   546   888   2,565   5,687 
    Net interest income      12,826   14,296   16,513   56,069   61,537 
    Provision for loan losses      (750)  (550)  800   (2,050)  3,000 
    Net interest income after provision for loan losses      13,576   14,846   15,713   58,119   58,537 
                   
    NON-INTEREST INCOME              
    Deposit service charges      1,206   1,183   1,073   4,446   4,030 
    Net gains on mortgage loans      514   851   2,432   4,691   6,477 
    Trust fees      1,114   1,079   957   4,331   3,758 
    Other      2,512   2,529   2,610   10,227   9,711 
    Total non-interest income      5,346   5,642   7,072   23,695   23,976 
                   
    NON-INTEREST EXPENSE              
    Salaries and benefits      6,024   6,278   6,593   25,216   25,530 
    Occupancy      963   992   971   3,986   3,955 
    Furniture and equipment      1,011   1,014   974   3,940   3,678 
    FDIC assessment      217   204   194   749   400 
    Other      3,122   3,062   3,234   12,199   12,162 
    Total non-interest expense      11,337   11,550   11,966   46,090   45,725 
    Income before income tax      7,585   8,938   10,819   35,724   36,788 
    Income tax expense      1,369   1,736   1,822   6,710   6,623 
    Net income     $6,216  $7,202  $8,997  $29,014  $30,165 
                   
    Basic earnings per common share     $0.18  $0.21  $0.26  $0.85  $0.88 
    Diluted earnings per common share     $0.18  $0.21  $0.26  $0.85  $0.88 
    Return on average assets      0.85%  0.98%  1.39%  1.02%  1.27%
    Return on average equity      9.84%  11.52%  15.24%  11.74%  13.19%
    Net interest margin (fully taxable equivalent)      1.85%  2.04%  2.69%  2.09%  2.75%
    Efficiency ratio      62.39%  57.93%  50.74%  57.78%  53.47%
                   
    BALANCE SHEET DATA          December 31September 30December 31
    Assets          2021   2021   2020 
    Cash and due from banks         $23,669  $30,413  $31,480 
    Federal funds sold and other short-term investments          1,128,119   1,239,525   752,256 
    Debt securities available for sale          416,063   241,475   236,832 
    Debt securities held to maturity          137,003   137,569   79,468 
    Federal Home Loan Bank Stock          11,558   11,558   11,558 
    Loans held for sale          1,407   2,635   5,422 
    Total loans          1,108,993   1,136,613   1,429,331 
    Less allowance for loan loss          15,889   16,532   17,408 
    Net loans          1,093,104   1,120,081   1,411,923 
    Premises and equipment, net          41,773   42,343   43,254 
    Bank-owned life insurance          52,468   52,781   42,516 
    Other real estate owned          2,343   2,343   2,537 
    Other assets          21,244   20,777   24,780 
                   
    Total Assets         $2,928,751  $2,901,500  $2,642,026 
                   
    Liabilities and Shareholders' Equity              
    Noninterest-bearing deposits         $886,115  $934,477  $809,437 
    Interest-bearing deposits          1,691,843   1,618,698   1,489,150 
    Total deposits          2,577,958   2,553,175   2,298,587 
    Other borrowed funds          85,000   85,000   70,000 
    Long-term debt          -   -   20,619 
    Other liabilities          11,788   11,112   12,977 
    Total Liabilities          2,674,746   2,649,287   2,402,183 
                   
    Shareholders' equity          254,005   252,213   239,843 
                   
    Total Liabilities and Shareholders' Equity         $2,928,751  $2,901,500  $2,642,026 
                   
                   
    MACATAWA BANK CORPORATION
    SELECTED CONSOLIDATED FINANCIAL DATA
    (Unaudited)
    (Dollars in thousands except per share information)
                   
      Quarterly Year to Date
                   
      4th Qtr 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr    
       2021   2021   2021   2021   2020   2021   2020 
    EARNINGS SUMMARY              
    Net interest income $12,826  $14,296  $14,457  $14,490  $16,513  $56,069  $61,537 
    Provision for loan losses  (750)  (550)  (750)  -   800   (2,050)  3,000 
    Total non-interest income  5,346   5,642   6,169   6,539   7,072   23,695   23,976 
    Total non-interest expense  11,337   11,550   11,718   11,485   11,966   46,090   45,725 
    Federal income tax expense  1,369   1,736   1,840   1,766   1,822   6,710   6,623 
    Net income $6,216  $7,202  $7,818  $7,778  $8,997  $29,014  $30,165 
                   
    Basic earnings per common share $0.18  $0.21  $0.23  $0.23  $0.26  $0.85  $0.88 
    Diluted earnings per common share $0.18  $0.21  $0.23  $0.23  $0.26  $0.85  $0.88 
                   
    MARKET DATA              
    Book value per common share $7.41  $7.38  $7.26  $7.09  $7.01  $7.41  $7.01 
    Tangible book value per common share $7.41  $7.38  $7.26  $7.09  $7.01  $7.41  $7.01 
    Market value per common share $8.82  $8.03  $8.75  $9.95  $8.37  $8.82  $8.37 
    Average basic common shares  34,229,664   34,190,264   34,193,016   34,195,526   34,154,820   34,202,179   34,120,275 
    Average diluted common shares  34,229,664   34,190,264   34,193,016   34,195,526   34,154,820   34,202,179   34,120,275 
    Period end common shares  34,259,945   34,189,799   34,192,317   34,193,132   34,197,519   34,259,945   34,197,519 
                   
    PERFORMANCE RATIOS              
    Return on average assets  0.85%  0.98%  1.11%  1.17%  1.39%  1.02%  1.27%
    Return on average equity  9.84%  11.52%  12.79%  12.91%  15.24%  11.74%  13.19%
    Net interest margin (fully taxable equivalent)  1.85%  2.04%  2.19%  2.33%  2.69%  2.09%  2.75%
    Efficiency ratio  62.39%  57.93%  56.81%  54.62%  50.74%  57.78%  53.47%
    Full-time equivalent employees (period end)  311   318   321   327   328   311   328 
                   
    ASSET QUALITY              
    Gross charge-offs $22  $22  $30  $50  $22  $124  $4,268 
    Net charge-offs/(recoveries) $(107) $(276) $(104) $(44) $(50) $(531) $2,792 
    Net charge-offs to average loans (annualized)  -0.04%  -0.09%  -0.03%  -0.01%  -0.01%  -0.04%  0.19%
    Nonperforming loans $92  $420  $433  $525  $533  $92  $533 
    Other real estate and repossessed assets $2,343  $2,343  $2,343  $2,371  $2,537  $2,343  $2,537 
    Nonperforming loans to total loans  0.01%  0.04%  0.03%  0.04%  0.04%  0.01%  0.04%
    Nonperforming assets to total assets  0.08%  0.10%  0.09%  0.11%  0.12%  0.08%  0.12%
    Allowance for loan losses $15,889  $16,532  $16,806  $17,452  $17,408  $15,889  $17,408 
    Allowance for loan losses to total loans  1.43%  1.45%  1.36%  1.26%  1.22%  1.43%  1.22%
    Allowance for loan losses to total loans (excluding PPP loans) 1.49%  1.56%  1.57%  1.55%  1.45%  1.49%  1.45%
    Allowance for loan losses to nonperforming loans  17270.65%  3936.19%  3881.29%  3324.19%  3266.04%  17270.65%  3266.04%
                   
    CAPITAL              
    Average equity to average assets  8.66%  8.48%  8.70%  9.04%  9.11%  8.71%  9.62%
    Common equity tier 1 to risk weighted assets (Consolidated)  17.24%  17.43%  17.10%  16.73%  15.79%  17.24%  15.79%
    Tier 1 capital to average assets (Consolidated)  8.72%  8.51%  9.48%  9.80%  9.89%  8.72%  9.89%
    Total capital to risk-weighted assets (Consolidated)  18.32%  18.58%  19.66%  19.33%  18.29%  18.32%  18.29%
    Common equity tier 1 to risk weighted assets (Bank)  16.70%  16.88%  16.57%  17.60%  16.67%  16.70%  16.67%
    Tier 1 capital to average assets (Bank)  8.44%  8.24%  8.49%  9.52%  9.63%  8.44%  9.63%
    Total capital to risk-weighted assets (Bank)  17.77%  18.02%  17.73%  18.81%  17.84%  17.77%  17.84%
    Common equity to assets  8.67%  8.69%  8.44%  8.87%  9.08%  8.67%  9.08%
    Tangible common equity to assets  8.67%  8.69%  8.44%  8.87%  9.08%  8.67%  9.08%
                   
    END OF PERIOD BALANCES              
    Total portfolio loans $1,108,993  $1,136,613  $1,238,327  $1,382,951  $1,429,331  $1,108,993  $1,429,331 
    Earning assets  2,803,853   2,768,507   2,803,634   2,611,093   2,510,882   2,803,853   2,510,882 
    Total assets  2,928,751   2,901,500   2,941,086   2,734,341   2,642,026   2,928,751   2,642,026 
    Deposits  2,577,958   2,553,175   2,600,076   2,387,945   2,298,587   2,577,958   2,298,587 
    Total shareholders' equity  254,005   252,213   248,217   242,379   239,843   254,005   239,843 
                   
    AVERAGE BALANCES              
    Total portfolio loans $1,109,863  $1,182,633  $1,324,915  $1,401,399  $1,481,054  $1,253,706  $1,495,068 
    Earning assets  2,780,236   2,804,157   2,669,862   2,537,300   2,457,746   2,698,846   2,247,850 
    Total assets  2,917,569   2,948,664   2,809,487   2,666,802   2,590,875   2,836,627   2,376,523 
    Deposits  2,564,961   2,605,043   2,468,398   2,321,012   2,249,679   2,490,838   2,044,643 
    Total shareholders' equity  252,606   249,994   244,516   241,023   236,127   247,075   228,692 

    Contact:

Jon W. Swets
Chief Financial Officer
616-494-7645
jswets@macatawabank.com

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