Macatawa Bank Corporation (NASDAQ: MCBC), the holding company for
Macatawa Bank (collectively, the “Company”), today announced its
results for the first quarter 2023.
- Net income of $12.0 million in first quarter 2023 – an increase
of 100% over $6.0 million earned in first quarter 2022 and
consistent with $12.1 million in fourth quarter 2022
- Net interest margin increased to 3.44% in first quarter 2023
versus 1.85% in first quarter 2022 and 3.34% in fourth quarter
2022
- Asset-sensitive balance sheet structure continued to produce
improved net interest income and net interest margin in rising
interest rate environment
- Continued loan portfolio growth – $43 million, or 15%
annualized growth rate, for the first quarter 2023
- Adoption of CECL resulted in $1.5 million increase to allowance
for credit losses
- Deposit portfolio balances decreased $284 million in the first
quarter 2023 reflecting seasonal outflows of higher than normal
seasonal inflows in the fourth quarter of 2022
- Deposits were $2.33 billion at March 31, 2023 - $625 million
higher than pre-pandemic deposit balances of $1.71 billion at March
31, 2020
- Financial condition remained solid at March 31, 2023:
- Robust capital position - $127 million in excess capital over
well-capitalized minimums
- Strong credit quality metrics – non-performing assets at 0.003%
of total assets and allowance coverage of 1.38%
- High liquidity levels - $391 million in overnight fund
balances, short duration bond portfolio of less than 3 years, no
new wholesale borrowings, and total additional borrowing capacity
of $951 million
The Company reported net income of $12.0 million,
or $0.35 per diluted share, in first quarter 2023 compared to $6.0
million, or $0.18 per diluted share, in first quarter
2022.
"We are pleased to report strong profitability for
the first quarter 2023,” said Ronald L. Haan, President and CEO of
the Company. “The impact of rising interest rates on our
asset-sensitive balance sheet that resulted in a significant
increase in revenue and bottom line results during 2022 carried
into the first quarter 2023. Net interest income for the first
quarter 2023 was up $10.0 million from first quarter 2022,
reflecting benefits from federal funds rate increases and growth in
our loan and investment securities portfolios. We remain encouraged
by our commercial loan origination activity while maintaining
excellent credit quality. We saw a deposit decrease during the
quarter as we typically experience outflow of the year end seasonal
increase that took place in December 2022. We are also beginning to
see both our business and personal customers use some of the excess
cash they built up over the pandemic. That said, our core deposit
balances remain high which is a strong signal that our customers
have confidence in our company. Our liquidity position is also
excellent with high overnight fund balances and nearly $1 billion
in total additional borrowing capacity allowing us to operate
comfortably in a period of economic
uncertainty.”
Mr. Haan concluded: "We believe our balance sheet
is well positioned in the current environment. High levels of
liquidity, capital, and excellent asset quality put us in a good
position to weather deteriorating economic conditions, should they
occur. While cautionary signals are ever present and we will
undoubtedly face new challenges, we remain committed to building a
conservative and well-disciplined company that is focused on using
prudent and time tested banking principles to protect our customer
deposits, while providing strong and consistent financial
performance to our shareholders.”
Operating ResultsNet interest
income for the first quarter 2023 totaled $22.6 million, a decrease
of $251,000 from fourth quarter 2022 and an increase of $10.0
million from the first quarter 2022. Net interest margin for first
quarter 2023 was 3.44 percent, up 10 basis points from the fourth
quarter 2022 and up 159 basis points from the first quarter
2022. Net interest income in first quarter 2023 versus
first quarter 2022 benefited from the significant increases in the
federal funds rate beginning in March 2022 and through March 2023
totaling 475 basis points and the related increases in rate indices
impacting the Company’s variable rate loan portfolios. Interest on
federal funds in the first quarter 2023 increased by $5.8 million
compared to first quarter 2022 due to higher rates paid on average
balances held. Net interest income also benefited from growth in
the investment securities portfolio to further deploy excess liquid
funds held by the Company. Interest on investments in the first
quarter 2023 increased by $3.0 million over first quarter 2022.
Non-interest income decreased $507,000 in first
quarter 2023 compared to fourth quarter 2022 and decreased $437,000
from first quarter 2022. Brokerage income was down $283,000 in the
first quarter 2023 compared to the fourth quarter 2022 and was up
$98,000 compared to the first quarter 2022. The rising rate
environment continued to have a negative effect on mortgage loan
sales gains. Gains on sales of mortgage loans in first quarter 2023
were just $11,000, down $21,000 compared to fourth quarter 2022 and
were down $297,000 from first quarter 2022. The Company originated
$179,000 in mortgage loans for sale in first quarter 2023 compared
to $1.2 million in fourth quarter 2022 and $10.1 million in first
quarter 2022. Trust fees were up $43,000 in first quarter 2023
compared to fourth quarter 2022 and were down $55,000 compared to
first quarter 2022, due largely to stock market conditions. Income
from debit and credit cards was down $21,000 in first quarter 2023
compared to fourth quarter 2022 and was up $63,000 compared to
first quarter 2022 due primarily to customer usage behavior.
Deposit service charge income, including treasury management fees,
was down $83,000 in first quarter 2023 compared to fourth quarter
2022 and was down $217,000 from first quarter 2022 primarily due to
higher earnings credits provided on treasury management accounts
with the increase in deposit market interest rates.
Non-interest expense was $12.2 million for first
quarter 2023, compared to $12.4 million for fourth quarter 2022 and
$11.7 million for first quarter 2022. The largest component of
non-interest expense was salaries and benefits expenses. Salaries
and benefits expenses were down $166,000 compared to fourth quarter
2022 and were up $409,000 compared to first quarter 2022. The
decrease compared to fourth quarter 2022 was primarily due to a
higher level of variable compensation for brokerage services, bonus
expense and medical insurance costs in the fourth quarter 2022,
while the increase from first quarter 2022 was due largely to a
higher level of salary and other compensation resulting from merit
adjustments to base pay effective April 1, 2022, a higher level of
variable compensation for brokerage services, a higher level of
401k matching contributions and a higher level of medical insurance
costs, partially offset by lower bonus expense and mortgage sales
commissions. The table below identifies the primary components of
the changes in salaries and benefits between periods.
Dollars in 000s |
|
Q1 2023toQ4 2022 |
|
Q1 2023toQ1 2022 |
|
|
|
|
|
|
|
|
Salaries and other compensation |
|
$ |
10 |
|
|
$ |
433 |
|
|
Salary deferral from
commercial loans |
|
|
66 |
|
|
|
70 |
|
|
Bonus accrual |
|
|
(81 |
) |
|
|
(118 |
) |
|
Mortgage production – variable
comp |
|
|
4 |
|
|
|
(86 |
) |
|
Brokerage – variable comp |
|
|
(96 |
) |
|
|
36 |
|
|
401k matching
contributions |
|
|
42 |
|
|
|
(1 |
) |
|
Medical insurance costs |
|
|
(111 |
) |
|
|
75 |
|
|
Total change in salaries and benefits |
|
$ |
(166 |
) |
|
$ |
409 |
|
|
Occupancy expenses were up $169,000 in first
quarter 2023 compared to fourth quarter 2022 due primarily to snow
removal costs and were down $35,000 compared to first quarter 2022
due to lower building maintenance costs. Data processing expenses
were down $10,000 in first quarter 2023 compared to fourth quarter
2022 and were up $71,000 compared to first quarter 2022 due to
higher usage of electronic banking services by our customers.
Favorably impacting other non-interest expense, we recognized
$356,000 in net gains on sales of other real estate owned in the
first quarter 2023 as we sold our final other real estate owned
property. There were no such sales in the fourth quarter 2022 or in
the first quarter 2022. Legal and professional fees were up
$120,000 in the first quarter 2023 compared to the fourth quarter
2022 and were up $154,000 compared to the first quarter 2022 due to
costs associated with new accounting and proxy statement
disclosures as well as various regulatory compliance matters
related to loan and deposit accounts referred to legal counsel
during the quarter. Outside services were down $154,000 in the
first quarter 2023 compared to fourth quarter 2022 and were down by
$26,000 compared to first quarter 2022. These costs were elevated
in the fourth quarter 2022 due to higher recruiting costs and
outsourced audits. Other categories of non-interest expense were
relatively flat compared to fourth quarter 2022 and first quarter
2022 due to a continued focus on expense
management.
Federal income tax expense was $3.0 million for
first quarter 2023, $3.0 million for fourth quarter 2022, and $1.4
million for first quarter 2022. The effective tax rate was 19.9
percent for first quarter 2023, compared to 19.6 percent for fourth
quarter 2022 and 18.8 percent for first quarter 2022. The increase
in the effective tax rate over 2022 was due to higher levels of
taxable income from both growth in taxable securities held in our
investment portfolio and growth in taxable income from rising
interest rates while our tax-exempt income has remained relatively
flat.
Asset QualityThe Company adopted
ASU 2016-13, Financial Instruments – Credit Losses, commonly
referred to as “CECL” on January 1, 2023. The impact on adoption
was an increase to the allowance for credit losses of $1.5 million.
No provision for credit losses was recorded in the first quarter
2023. A provision for credit losses expense of $375,000 was
recorded in the fourth quarter 2022 while a provision benefit of
$1.5 million was recorded in first quarter 2022. Net loan
recoveries for first quarter 2023 were $33,000, compared to fourth
quarter 2022 net loan recoveries of $89,000 and first quarter 2022
net loan recoveries of $227,000. At March 31, 2023, the Company had
experienced net loan recoveries in thirty-one of the past
thirty-three quarters. Total loans past due on payments
by 30 days or more amounted to $277,000 at March 31, 2023, versus
$172,000 at December 31, 2022 and $171,000 at March 31, 2022.
Delinquencies at March 31, 2023 were comprised of just three
individual loans. Delinquency as a percentage of total loans was
just 0.02 percent at March 31, 2023, well below the Company’s peer
level.
The allowance for credit losses of $16.8 million
was 1.38 percent of total loans at March 31, 2023, compared to
$15.3 million or 1.30 percent of total loans at December 31, 2022,
and $14.6 million or 1.33 percent at March 31, 2022. The coverage
ratio of allowance for credit losses to nonperforming loans
continued to be strong and significantly exceeded 1-to-1 coverage
at 224-to-1 as of March 31, 2023.
At March 31, 2023, the Company's nonperforming
loans were $75,000, representing 0.01 percent of total loans. This
compares to $78,000 (0.01 percent of total loans) at December 31,
2022 and $90,000 (0.01 percent of total loans) at March 31, 2022.
The Company had no other real estate owned and repossessed assets
at March 31, 2023, down from $2.3 million at December 31, 2022 and
March 31, 2022. The Company sold its final other real estate owned
property in first quarter 2023, recognizing a net gain of $356,000.
Total nonperforming assets, including other real estate owned and
nonperforming loans, decreased by $2.4 million from March 31, 2022
to March 31, 2023.
A break-down of non-performing loans is shown in
the table below.
Dollars in 000s |
|
Mar 31,2023 |
|
Dec 31,2022 |
|
Sept 30,2022 |
|
June 30,2022 |
|
Mar 31,2022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial Real Estate |
|
$ |
--- |
|
$ |
--- |
|
$ |
--- |
|
$ |
5 |
|
$ |
5 |
|
Commercial and Industrial |
|
|
--- |
|
|
--- |
|
|
--- |
|
|
1 |
|
|
1 |
|
Total Commercial Loans |
|
|
--- |
|
|
--- |
|
|
--- |
|
|
6 |
|
|
6 |
|
Residential Mortgage
Loans |
|
|
75 |
|
|
78 |
|
|
85 |
|
|
84 |
|
|
84 |
|
Consumer Loans |
|
|
--- |
|
|
--- |
|
|
--- |
|
|
--- |
|
|
--- |
|
Total Non-Performing Loans |
|
$ |
75 |
|
$ |
78 |
|
$ |
85 |
|
$ |
90 |
|
$ |
90 |
|
A break-down of non-performing assets is shown in
the table below.
Dollars in 000s |
|
Mar 31,2023 |
|
Dec 31,2022 |
|
Sept 30,2022 |
|
June 30,2022 |
|
Mar 31,2022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Performing Loans |
|
$ |
75 |
|
$ |
78 |
|
$ |
85 |
|
$ |
90 |
|
$ |
90 |
|
Other Repossessed Assets |
|
|
--- |
|
|
--- |
|
|
--- |
|
|
--- |
|
|
--- |
|
Other Real Estate Owned |
|
|
--- |
|
|
2,343 |
|
|
2,343 |
|
|
2,343 |
|
|
2,343 |
|
Total Non-Performing Assets |
|
$ |
75 |
|
$ |
2,421 |
|
$ |
2,428 |
|
$ |
2,433 |
|
$ |
2,433 |
|
Balance Sheet, Liquidity and
Capital
Total assets were $2.64 billion at March 31, 2023,
a decrease of $269.8 million from $2.91 billion at December 31,
2022 and a decrease of $292.7 million from $2.93 billion at March
31, 2022.
The Company’s investment portfolio primarily
consists of U.S. treasury and agency securities, agency mortgage
backed securities and various municipal securities. Total
securities were $874.3 million at March 31, 2023, an increase of
$26.3 million from $848.0 million at December 31, 2022 and an
increase of $273.7 million from $600.7 million at March 31, 2022.
The overall duration of the Company’s investment portfolio at March
31, 2023 is relatively short at less than three years. This
provides a reliable source of cash inflows to support
liquidity.
Total loans were $1.22 billion at March 31, 2023,
an increase of $43.2 million from $1.18 billion at December 31,
2022 and an increase of $119.0 million from $1.10 billion at March
31, 2022.
Commercial loans increased by $84.1 million from
March 31, 2022 to March 31, 2023, along with an increase of $34.4
million in the residential mortgage portfolio, and an increase of
$504,000 in the consumer loan portfolio. Within commercial loans,
commercial real estate loans increased by $21.5 million and
commercial and industrial loans increased by $63.1 million. The
loan growth experienced in this time period was the direct result
of both new loan prospecting efforts and existing customers
beginning to borrow more for expansion of their businesses.
The composition of the commercial loan portfolio is
shown in the table below:
Dollars in 000s |
|
Mar 31,2023 |
|
Dec 31,2022 |
|
Sept 30,2022 |
|
June 30,2022 |
|
Mar 31,2022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Construction and Development |
|
$ |
120,268 |
|
$ |
116,715 |
|
$ |
111,624 |
|
$ |
107,325 |
|
$ |
104,945 |
|
Other Commercial Real
Estate |
|
|
423,080 |
|
|
420,888 |
|
|
410,600 |
|
|
411,778 |
|
|
417,368 |
|
Commercial Loans Securedby Real Estate |
|
|
543,348 |
|
|
537,603 |
|
|
522,224 |
|
|
519,103 |
|
|
522,313 |
|
Commercial and Industrial |
|
|
473,354 |
|
|
441,716 |
|
|
427,034 |
|
|
407,788 |
|
|
402,854 |
|
Paycheck Protection
Program |
|
|
--- |
|
|
--- |
|
|
32 |
|
|
2,791 |
|
|
7,393 |
|
Total Commercial Loans |
|
$ |
1,016,702 |
|
$ |
979,319 |
|
$ |
949,290 |
|
$ |
929,682 |
|
$ |
932,560 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total deposits were $2.33 billion at March 31,
2023, down $284.2 million, or 11 percent, from $2.62 billion at
December 31, 2022 and down $251.4 million, or 10 percent, from
$2.58 billion at March 31, 2022. While the Company experienced a
decline in deposit balances during the three months ended March 31,
2023, most of the decline took place prior to the early March 2023
bank failures. The Company experienced a seasonal run up in
business deposits of about $90 million in December 2022, which came
back out in January 2023. In addition, a couple of large business
customers removed deposits totaling nearly $90 million in early
March 2023 for specific designated purposes. The Company
experienced very little change in deposit balances following the
March 2023 bank failures and resulting banking system
disruption.
Macatawa’s deposit base is primarily made up of
many small accounts, and balances at March 31, 2023 were comprised
of 48% personal customers and 52% business customers. Core deposits
- which Management defines as deposits sourced within its local
markets - represented 100% of total deposits at March 31, 2023.
Total deposit balances of $2.33 billion at March 31, 2023 remained
elevated, reflecting a $625.5 million increase, or 37%, over
pre-pandemic totals of $1.71 billion as of March 31, 2020.
Demand deposits were down $296.4 million at the end
of first quarter 2023 compared to the end of fourth quarter 2022
and were down $297.9 million compared to the end of first quarter
2022. Money market deposits and savings deposits were down $63.4
million from the end of fourth quarter 2022 and were down $40.3
million from the end of third quarter 2022. Certificates of deposit
were up $75.5 million at March 31, 2023 compared to December 31,
2022 and were up $86.9 million compared to March 31, 2022 as
customers reacted to changes in market interest rates. All
certificates of deposit are to local customers as the Company does
not have any brokered deposits at March 31, 2023. The Company
continues to be successful at attracting and retaining core local
deposit customers. Customer deposit accounts remain insured to the
highest levels available under FDIC deposit insurance.
Management has actively pursued initiatives to
maintain a strong liquidity position. The Company had no brokered
deposits on balance sheet since December 2011 and continues to
maintain significant on-balance sheet liquidity. At March 31,
2023, balances held in federal funds sold and other short-term
investments amounted to $391.3 million. In addition, the Company
had total additional borrowing capacity from correspondent banks,
including the Federal Reserve’s new Bank Term Funding Program, of
approximately $951.0 million as of March 31, 2023. Finally,
because Management has maintained the discipline of buying
shorter-term bond durations in the investment securities portfolio,
there are $393.0 million in bond maturities and paydowns coming
into the Company in the next 24 months ending March 31, 2025.
The Company's total risk-based regulatory capital
ratio at March 31, 2023 was consistent with the ratio at December
31, 2022 and March 31, 2022. 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" with $127.2 million in excess capital over well
capitalized minimums at March 31, 2023.
About Macatawa BankHeadquartered
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 thirteen years as one of “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 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, future interest rates, future
net interest margin, future economic conditions, and future levels
of unrealized gains or losses in the investment securities
portfolio. 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, interest rates 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, 2022. 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) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1st
Qtr |
|
4th
Qtr |
|
1st
Qtr |
|
EARNINGS SUMMARY |
|
|
|
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2022 |
|
|
Total
interest income |
|
|
|
|
|
$ |
27,266 |
|
|
$ |
25,454 |
|
|
$ |
13,143 |
|
|
Total
interest expense |
|
|
|
|
|
|
4,650 |
|
|
|
2,587 |
|
|
|
478 |
|
|
Net interest income |
|
|
|
|
|
|
22,616 |
|
|
|
22,867 |
|
|
|
12,665 |
|
|
Provision
for credit losses |
|
|
|
|
|
|
- |
|
|
|
375 |
|
|
|
(1,500 |
) |
|
Net interest income after provision for credit losses |
|
|
|
|
|
|
22,616 |
|
|
|
22,492 |
|
|
|
14,165 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NON-INTEREST
INCOME |
|
|
|
|
|
|
|
|
|
|
|
Deposit
service charges |
|
|
|
|
|
|
994 |
|
|
|
1,077 |
|
|
|
1,211 |
|
|
Net gains on
mortgage loans |
|
|
|
|
|
|
11 |
|
|
|
32 |
|
|
|
308 |
|
|
Trust
fees |
|
|
|
|
|
|
1,033 |
|
|
|
990 |
|
|
|
1,088 |
|
|
Other |
|
|
|
|
|
|
2,490 |
|
|
|
2,936 |
|
|
|
2,358 |
|
|
Total non-interest income |
|
|
|
|
|
|
4,528 |
|
|
|
5,035 |
|
|
|
4,965 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NON-INTEREST
EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
Salaries and
benefits |
|
|
|
|
|
|
6,698 |
|
|
|
6,864 |
|
|
|
6,289 |
|
|
Occupancy |
|
|
|
|
|
|
1,137 |
|
|
|
968 |
|
|
|
1,172 |
|
|
Furniture
and equipment |
|
|
|
|
|
|
1,031 |
|
|
|
991 |
|
|
|
1,016 |
|
|
FDIC
assessment |
|
|
|
|
|
|
330 |
|
|
|
211 |
|
|
|
180 |
|
|
Other |
|
|
|
|
|
|
2,969 |
|
|
|
3,414 |
|
|
|
3,082 |
|
|
Total non-interest expense |
|
|
|
|
|
|
12,165 |
|
|
|
12,448 |
|
|
|
11,739 |
|
|
Income
before income tax |
|
|
|
|
|
|
14,979 |
|
|
|
15,079 |
|
|
|
7,391 |
|
|
Income tax
expense |
|
|
|
|
|
|
2,975 |
|
|
|
2,961 |
|
|
|
1,391 |
|
|
Net
income |
|
|
|
|
|
$ |
12,004 |
|
|
$ |
12,118 |
|
|
$ |
6,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
earnings per common share |
|
|
|
|
|
$ |
0.35 |
|
|
$ |
0.35 |
|
|
$ |
0.18 |
|
|
Diluted
earnings per common share |
|
|
|
|
|
$ |
0.35 |
|
|
$ |
0.35 |
|
|
$ |
0.18 |
|
|
Return on
average assets |
|
|
|
|
|
|
1.74 |
% |
|
|
1.72 |
% |
|
|
0.82 |
% |
|
Return on
average equity |
|
|
|
|
|
|
19.19 |
% |
|
|
20.22 |
% |
|
|
9.54 |
% |
|
Net interest
margin (fully taxable equivalent) |
|
|
|
|
|
|
3.44 |
% |
|
|
3.34 |
% |
|
|
1.85 |
% |
|
Efficiency
ratio |
|
|
|
|
|
|
44.82 |
% |
|
|
44.61 |
% |
|
|
66.59 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
BALANCE SHEET DATA |
|
|
|
|
|
March
31 |
|
December
31 |
March
31 |
|
Assets |
|
|
|
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2022 |
|
|
Cash and due
from banks |
|
|
|
|
|
$ |
29,402 |
|
|
$ |
51,215 |
|
|
$ |
31,957 |
|
|
Federal
funds sold and other short-term investments |
|
|
|
|
|
|
391,336 |
|
|
|
703,955 |
|
|
|
1,078,983 |
|
|
Debt
securities available for sale |
|
|
|
|
|
|
525,959 |
|
|
|
499,257 |
|
|
|
346,114 |
|
|
Debt
securities held to maturity |
|
|
|
|
|
|
348,387 |
|
|
|
348,765 |
|
|
|
254,565 |
|
|
Federal Home
Loan Bank Stock |
|
|
|
|
|
|
10,211 |
|
|
|
10,211 |
|
|
|
10,211 |
|
|
Loans held
for sale |
|
|
|
|
|
|
87 |
|
|
|
215 |
|
|
|
855 |
|
|
Total
loans |
|
|
|
|
|
|
1,220,939 |
|
|
|
1,177,748 |
|
|
|
1,101,902 |
|
|
Less
allowance for credit losses |
|
|
|
|
|
|
16,794 |
|
|
|
15,285 |
|
|
|
14,616 |
|
|
Net loans |
|
|
|
|
|
|
1,204,145 |
|
|
|
1,162,463 |
|
|
|
1,087,286 |
|
|
Premises and
equipment, net |
|
|
|
|
|
|
40,249 |
|
|
|
40,306 |
|
|
|
41,413 |
|
|
Bank-owned
life insurance |
|
|
|
|
|
|
53,557 |
|
|
|
53,345 |
|
|
|
52,720 |
|
|
Other real
estate owned |
|
|
|
|
|
|
- |
|
|
|
2,343 |
|
|
|
2,343 |
|
|
Other
assets |
|
|
|
|
|
|
33,820 |
|
|
|
34,844 |
|
|
|
23,436 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Assets |
|
|
|
|
|
$ |
2,637,153 |
|
|
$ |
2,906,919 |
|
|
$ |
2,929,883 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Shareholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing deposits |
|
|
|
|
|
$ |
690,444 |
|
|
$ |
834,879 |
|
|
$ |
918,907 |
|
|
Interest-bearing deposits |
|
|
|
|
|
|
1,640,451 |
|
|
|
1,780,263 |
|
|
|
1,663,390 |
|
|
Total deposits |
|
|
|
|
|
|
2,330,895 |
|
|
|
2,615,142 |
|
|
|
2,582,297 |
|
|
Other
borrowed funds |
|
|
|
|
|
|
30,000 |
|
|
|
30,000 |
|
|
|
85,000 |
|
|
Long-term
debt |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
Other
liabilities |
|
|
|
|
|
|
15,690 |
|
|
|
14,739 |
|
|
|
16,984 |
|
|
Total Liabilities |
|
|
|
|
|
|
2,376,585 |
|
|
|
2,659,881 |
|
|
|
2,684,281 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' equity |
|
|
|
|
|
|
260,568 |
|
|
|
247,038 |
|
|
|
245,602 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities and Shareholders' Equity |
|
|
|
|
|
$ |
2,637,153 |
|
|
$ |
2,906,919 |
|
|
$ |
2,929,883 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MACATAWA
BANK CORPORATION |
SELECTED
CONSOLIDATED FINANCIAL DATA |
(Unaudited) |
(Dollars in thousands except per share information) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarterly |
|
|
|
1st
Qtr |
|
4th
Qtr |
|
3rd
Qtr |
|
2nd
Qtr |
|
1st
Qtr |
|
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2022 |
|
|
|
2022 |
|
|
|
2022 |
|
|
EARNINGS SUMMARY |
|
|
|
|
|
|
|
|
|
|
|
Net interest
income |
|
$ |
22,616 |
|
|
$ |
22,867 |
|
|
$ |
19,771 |
|
|
$ |
14,843 |
|
|
$ |
12,665 |
|
|
Provision
for credit losses |
|
|
- |
|
|
|
375 |
|
|
|
- |
|
|
|
- |
|
|
|
(1,500 |
) |
|
Total
non-interest income |
|
|
4,528 |
|
|
|
5,035 |
|
|
|
4,889 |
|
|
|
5,131 |
|
|
|
4,965 |
|
|
Total
non-interest expense |
|
|
12,165 |
|
|
|
12,448 |
|
|
|
12,127 |
|
|
|
11,913 |
|
|
|
11,739 |
|
|
Federal
income tax expense |
|
|
2,975 |
|
|
|
2,961 |
|
|
|
2,488 |
|
|
|
1,493 |
|
|
|
1,391 |
|
|
Net
income |
|
$ |
12,004 |
|
|
$ |
12,118 |
|
|
$ |
10,045 |
|
|
$ |
6,568 |
|
|
$ |
6,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
earnings per common share |
|
$ |
0.35 |
|
|
$ |
0.35 |
|
|
$ |
0.29 |
|
|
$ |
0.19 |
|
|
$ |
0.18 |
|
|
Diluted
earnings per common share |
|
$ |
0.35 |
|
|
$ |
0.35 |
|
|
$ |
0.29 |
|
|
$ |
0.19 |
|
|
$ |
0.18 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MARKET DATA |
|
|
|
|
|
|
|
|
|
|
|
Book value
per common share |
|
$ |
7.60 |
|
|
$ |
7.20 |
|
|
$ |
6.91 |
|
|
$ |
7.10 |
|
|
$ |
7.17 |
|
|
Tangible
book value per common share |
|
$ |
7.60 |
|
|
$ |
7.20 |
|
|
$ |
6.91 |
|
|
$ |
7.10 |
|
|
$ |
7.17 |
|
|
Market value
per common share |
|
$ |
10.22 |
|
|
$ |
11.03 |
|
|
$ |
9.26 |
|
|
$ |
8.84 |
|
|
$ |
9.01 |
|
|
Average
basic common shares |
|
|
34,297,221 |
|
|
|
34,277,839 |
|
|
|
34,251,792 |
|
|
|
34,253,846 |
|
|
|
34,254,772 |
|
|
Average
diluted common shares |
|
|
34,297,221 |
|
|
|
34,277,839 |
|
|
|
34,251,792 |
|
|
|
34,253,846 |
|
|
|
34,254,772 |
|
|
Period end
common shares |
|
|
34,292,294 |
|
|
|
34,298,640 |
|
|
|
34,251,485 |
|
|
|
34,253,147 |
|
|
|
34,253,962 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PERFORMANCE RATIOS |
|
|
|
|
|
|
|
|
|
|
|
Return on
average assets |
|
|
1.74 |
% |
|
|
1.72 |
% |
|
|
1.40 |
% |
|
|
0.92 |
% |
|
|
0.82 |
% |
|
Return on
average equity |
|
|
19.19 |
% |
|
|
20.22 |
% |
|
|
16.41 |
% |
|
|
10.80 |
% |
|
|
9.54 |
% |
|
Efficiency
ratio |
|
|
44.82 |
% |
|
|
44.61 |
% |
|
|
49.18 |
% |
|
|
59.64 |
% |
|
|
66.59 |
% |
|
Full-time
equivalent employees (period end) |
|
|
317 |
|
|
|
318 |
|
|
|
316 |
|
|
|
315 |
|
|
|
311 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YIELDS AND COST OF FUNDS RATIOS |
|
|
|
|
|
|
|
|
|
|
|
Federal
funds sold and other short-term investments |
|
|
4.58 |
% |
|
|
3.72 |
% |
|
|
2.27 |
% |
|
|
0.79 |
% |
|
|
0.19 |
% |
|
Debt
securities (fully taxable equivalent) |
|
|
2.40 |
% |
|
|
2.25 |
% |
|
|
2.07 |
% |
|
|
1.87 |
% |
|
|
1.66 |
% |
|
Commercial
loans |
|
|
5.40 |
% |
|
|
4.93 |
% |
|
|
4.30 |
% |
|
|
3.79 |
% |
|
|
3.88 |
% |
|
Residential
mortgage loans |
|
|
3.73 |
% |
|
|
3.53 |
% |
|
|
3.39 |
% |
|
|
3.27 |
% |
|
|
3.22 |
% |
|
Consumer
loans |
|
|
7.20 |
% |
|
|
6.22 |
% |
|
|
5.18 |
% |
|
|
4.09 |
% |
|
|
3.89 |
% |
|
Total
loans |
|
|
5.28 |
% |
|
|
4.83 |
% |
|
|
4.24 |
% |
|
|
3.74 |
% |
|
|
3.81 |
% |
|
Total yield
on interest earning assets (fully taxable equivalent) |
|
|
4.15 |
% |
|
|
3.72 |
% |
|
|
3.02 |
% |
|
|
2.28 |
% |
|
|
1.92 |
% |
|
Interest
bearing demand deposits |
|
|
0.43 |
% |
|
|
0.34 |
% |
|
|
0.14 |
% |
|
|
0.03 |
% |
|
|
0.02 |
% |
|
Savings and
money market accounts |
|
|
1.35 |
% |
|
|
0.73 |
% |
|
|
0.29 |
% |
|
|
0.07 |
% |
|
|
0.03 |
% |
|
Time
deposits |
|
|
2.22 |
% |
|
|
0.84 |
% |
|
|
0.29 |
% |
|
|
0.20 |
% |
|
|
0.23 |
% |
|
Total
interest bearing deposits |
|
|
1.05 |
% |
|
|
0.57 |
% |
|
|
0.22 |
% |
|
|
0.06 |
% |
|
|
0.04 |
% |
|
Other
borrowed funds |
|
|
2.08 |
% |
|
|
2.08 |
% |
|
|
2.08 |
% |
|
|
2.53 |
% |
|
|
1.51 |
% |
|
Total
average cost of funds on interest bearing liabilities |
|
|
1.07 |
% |
|
|
0.60 |
% |
|
|
0.26 |
% |
|
|
0.14 |
% |
|
|
0.11 |
% |
|
Net interest
margin (fully taxable equivalent) |
|
|
3.44 |
% |
|
|
3.34 |
% |
|
|
2.86 |
% |
|
|
2.19 |
% |
|
|
1.85 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSET QUALITY |
|
|
|
|
|
|
|
|
|
|
|
Gross
charge-offs |
|
$ |
21 |
|
|
$ |
23 |
|
|
$ |
46 |
|
|
$ |
60 |
|
|
$ |
35 |
|
|
Net
charge-offs/(recoveries) |
|
$ |
(33 |
) |
|
$ |
(89 |
) |
|
$ |
(190 |
) |
|
$ |
(15 |
) |
|
$ |
(227 |
) |
|
Net
charge-offs to average loans (annualized) |
|
|
-0.01 |
% |
|
|
-0.03 |
% |
|
|
-0.07 |
% |
|
|
-0.01 |
% |
|
|
-0.08 |
% |
|
Nonperforming loans |
|
$ |
75 |
|
|
$ |
78 |
|
|
$ |
85 |
|
|
$ |
90 |
|
|
$ |
90 |
|
|
Other real
estate and repossessed assets |
|
$ |
- |
|
|
$ |
2,343 |
|
|
$ |
2,343 |
|
|
$ |
2,343 |
|
|
$ |
2,343 |
|
|
Nonperforming loans to total loans |
|
|
0.01 |
% |
|
|
0.01 |
% |
|
|
0.01 |
% |
|
|
0.01 |
% |
|
|
0.01 |
% |
|
Nonperforming assets to total assets |
|
|
0.00 |
% |
|
|
0.08 |
% |
|
|
0.09 |
% |
|
|
0.09 |
% |
|
|
0.08 |
% |
|
Allowance
for credit losses |
|
$ |
16,794 |
|
|
$ |
15,285 |
|
|
$ |
14,821 |
|
|
$ |
14,631 |
|
|
$ |
14,616 |
|
|
Allowance
for credit losses to total loans |
|
|
1.38 |
% |
|
|
1.30 |
% |
|
|
1.30 |
% |
|
|
1.32 |
% |
|
|
1.33 |
% |
|
Allowance
for credit losses to total loans (excluding PPP loans) |
|
|
1.38 |
% |
|
|
1.30 |
% |
|
|
1.30 |
% |
|
|
1.32 |
% |
|
|
1.34 |
% |
|
Allowance
for credit losses to nonperforming loans |
|
|
22392.00 |
% |
|
|
19596.15 |
% |
|
|
17436.47 |
% |
|
|
16256.67 |
% |
|
|
16240.00 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL |
|
|
|
|
|
|
|
|
|
|
|
Average
equity to average assets |
|
|
9.07 |
% |
|
|
8.49 |
% |
|
|
8.52 |
% |
|
|
8.55 |
% |
|
|
8.62 |
% |
|
Common
equity tier 1 to risk weighted assets (Consolidated) |
|
|
17.08 |
% |
|
|
16.94 |
% |
|
|
16.72 |
% |
|
|
16.54 |
% |
|
|
16.92 |
% |
|
Tier 1
capital to average assets (Consolidated) |
|
|
10.26 |
% |
|
|
9.73 |
% |
|
|
9.29 |
% |
|
|
9.13 |
% |
|
|
8.82 |
% |
|
Total
capital to risk-weighted assets (Consolidated) |
|
|
18.08 |
% |
|
|
17.87 |
% |
|
|
17.64 |
% |
|
|
17.47 |
% |
|
|
17.88 |
% |
|
Common
equity tier 1 to risk weighted assets (Bank) |
|
|
16.58 |
% |
|
|
16.44 |
% |
|
|
16.24 |
% |
|
|
16.04 |
% |
|
|
16.39 |
% |
|
Tier 1
capital to average assets (Bank) |
|
|
9.96 |
% |
|
|
9.44 |
% |
|
|
9.02 |
% |
|
|
8.85 |
% |
|
|
8.55 |
% |
|
Total
capital to risk-weighted assets (Bank) |
|
|
17.58 |
% |
|
|
17.37 |
% |
|
|
17.16 |
% |
|
|
16.97 |
% |
|
|
17.35 |
% |
|
Common
equity to assets |
|
|
9.88 |
% |
|
|
8.50 |
% |
|
|
8.34 |
% |
|
|
8.74 |
% |
|
|
8.38 |
% |
|
Tangible
common equity to assets |
|
|
9.88 |
% |
|
|
8.50 |
% |
|
|
8.34 |
% |
|
|
8.74 |
% |
|
|
8.38 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
END
OF PERIOD BALANCES |
|
|
|
|
|
|
|
|
|
|
|
Total
portfolio loans |
|
$ |
1,220,939 |
|
|
$ |
1,177,748 |
|
|
$ |
1,138,645 |
|
|
$ |
1,111,915 |
|
|
$ |
1,101,902 |
|
|
Earning
assets |
|
|
2,531,184 |
|
|
|
2,781,515 |
|
|
|
2,727,924 |
|
|
|
2,655,706 |
|
|
|
2,802,498 |
|
|
Total
assets |
|
|
2,637,153 |
|
|
|
2,906,919 |
|
|
|
2,835,038 |
|
|
|
2,781,208 |
|
|
|
2,929,883 |
|
|
Deposits |
|
|
2,330,895 |
|
|
|
2,615,142 |
|
|
|
2,556,197 |
|
|
|
2,494,583 |
|
|
|
2,582,297 |
|
|
Total
shareholders' equity |
|
|
260,568 |
|
|
|
247,038 |
|
|
|
236,554 |
|
|
|
243,109 |
|
|
|
245,602 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVERAGE BALANCES |
|
|
|
|
|
|
|
|
|
|
|
Federal
funds sold and other short-term investments |
|
$ |
555,670 |
|
|
$ |
681,489 |
|
|
$ |
803,082 |
|
|
$ |
858,545 |
|
|
$ |
1,111,216 |
|
|
Total debt
securities |
|
|
898,691 |
|
|
|
862,613 |
|
|
|
808,477 |
|
|
|
751,411 |
|
|
|
572,708 |
|
|
Total
portfolio loans |
|
|
1,186,684 |
|
|
|
1,159,449 |
|
|
|
1,124,950 |
|
|
|
1,103,955 |
|
|
|
1,092,673 |
|
|
Earning
assets |
|
|
2,650,972 |
|
|
|
2,713,294 |
|
|
|
2,746,975 |
|
|
|
2,724,714 |
|
|
|
2,788,254 |
|
|
Total
assets |
|
|
2,757,594 |
|
|
|
2,822,770 |
|
|
|
2,874,343 |
|
|
|
2,847,381 |
|
|
|
2,917,462 |
|
|
Non-interest
bearing deposits |
|
|
732,434 |
|
|
|
847,752 |
|
|
|
917,552 |
|
|
|
897,727 |
|
|
|
875,223 |
|
|
Total
interest bearing deposits |
|
|
1,727,883 |
|
|
|
1,687,693 |
|
|
|
1,668,613 |
|
|
|
1,639,384 |
|
|
|
1,694,092 |
|
|
Total
deposits |
|
|
2,460,318 |
|
|
|
2,535,446 |
|
|
|
2,586,165 |
|
|
|
2,537,111 |
|
|
|
2,569,315 |
|
|
Borrowings |
|
|
30,000 |
|
|
|
30,000 |
|
|
|
30,000 |
|
|
|
54,305 |
|
|
|
85,002 |
|
|
Total
shareholders' equity |
|
|
250,160 |
|
|
|
239,684 |
|
|
|
244,857 |
|
|
|
243,352 |
|
|
|
251,600 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contact:
Jon W. Swets
Chief Financial Officer
616-494-7645
jswets@macatawabank.com
Grafico Azioni Macatawa Bank (NASDAQ:MCBC)
Storico
Da Giu 2024 a Lug 2024
Grafico Azioni Macatawa Bank (NASDAQ:MCBC)
Storico
Da Lug 2023 a Lug 2024