Exhibit 99.1
 
For Immediate Release 
NASDAQ Stock Market:   MCBC
 
Macatawa Bank Corporation Reports
Fourth Quarter and Full Year 2016 Results

HOLLAND, Mich. (January 26, 2017)  Macatawa Bank Corporation (NASDAQ: MCBC) today announced its results for the fourth quarter and full year of 2016, reflecting continued improvement in financial performance.

 
Net income of $4.1 million in fourth quarter 2016, up 16% from $3.5 million in fourth quarter 2015.  Full year net income of $16.0 million, up 25% from $12.8 million in 2015.
Net interest income increase of $831,000 for fourth quarter 2016 compared to 2015, and $3.5 million for full year 2016, driven by loan growth.
Loan growth of $44.4 million for fourth quarter 2016 and $82.9 million, or 7%, for full year 2016.
Noninterest expense down $1.1 million, or 9% in fourth quarter 2016 compared to fourth quarter 2015 and down $1.2 million, or 3% for full year 2016
Past due loans remained at very low levels - only 0.11% of total loans at end of 2016
Nonperforming assets down 32% from fourth quarter 2015
Favorable loan collection results – eight consecutive quarters of net recoveries

Macatawa reported net income of $4.1 million, or $0.12 per diluted share, in the fourth quarter 2016 compared to $3.5 million, or $0.10 per diluted share, in the fourth quarter 2015.  For the full year of 2016, the Company reported net income of $16.0 million, or $0.47 per diluted share compared to $12.8 million, or $0.38 per diluted share, for the same period in 2015.

"Operating performance continued to improve in both the fourth quarter and the full year of 2016,” said Ronald L. Haan, President and CEO of the Company.  “Strong revenue growth and lower operating expenses resulted in a 25% increase in full year net income compared to 2015.  Revenue, including net interest income and other noninterest sources, increased by $4.7 million over the prior year while noninterest expenses declined by $1.2 million.  Full year loan growth of $82.9 million, or 7%, was consistent with the loan growth we have experienced in each of the last three years and continued to be the primary driver of revenue growth.  Asset quality remained excellent, and our loan collection efforts remained strong with eight consecutive quarters of net recoveries.  We have honored our commitment to drive profitable growth with solid increases in quality loans, while maintaining a disciplined approach to managing expenses.”

Mr. Haan concluded:  "Our long term strategy remains the same.  We intend to drive profitable growth and maintain a well disciplined company that will deliver strong and consistent financial performance to our shareholders.   As we move into 2017, our recent loan growth will continue to benefit our net interest income, as will the recent increase in interest rates.”
 

Macatawa Bank Corporation 4Q Results / page 2 of 5

Operating Results
Net interest income for the fourth quarter 2016 totaled $12.3 million, an increase of $390,000 from the third quarter 2016 and an increase of $831,000 from the fourth quarter 2015.  Net interest margin was 3.11 percent for the fourth quarter 2016.  Net interest margin on a fully tax equivalent basis was 3.17 percent for the fourth quarter 2016, up 9 basis points from the third quarter 2016, and up 14 basis points from the fourth quarter 2015.(1)

Average interest earning assets for the fourth quarter 2016 increased $10.7 million from the third quarter 2016 and were up $39.1 million from the fourth quarter 2015.

Non-interest income decreased by $219,000 in the fourth quarter 2016 compared to the third quarter 2016 and increased by $353,000 compared to the fourth quarter 2015.  These fluctuations were primarily driven by gains on sales of mortgage loans.  The increase in rates in the fourth quarter 2016 negatively impacted volume of mortgage loans originated and sold.  The Bank originated $27.3 million in loans for sale in the fourth quarter 2016 compared to $38.2 million in loans for sale in the third quarter 2016 and $23.4 million in loans for sale in the fourth quarter 2015.

Non-interest expense was $11.5 million for the fourth quarter 2016, compared to $11.3 million for the third quarter 2016 and $12.6 million for the fourth quarter 2015.  The largest fluctuations in non-interest expense related to problem asset costs, which decreased $225,000 in fourth quarter 2016 compared to third quarter 2016 and decreased $1.6 million compared to fourth quarter 2015.  These costs fluctuated as a result of writedowns on other real estate owned property.  The large fluctuation from fourth quarter 2015 was due to a $1.1 million loss taken on the sale of the Bank’s largest individual other real estate owned property in the fourth quarter 2015.  Salaries and benefits expense was up $179,000 in the fourth quarter 2016 compared to third quarter 2016 and was up $151,000 compared to fourth quarter 2015. These increases were due to increased employee benefits expenses, primarily related to costs associated with medical benefits.

Federal income tax expense was $1.8 million for the fourth quarter 2016 compared to $1.4 million for the third quarter 2016 and $1.6 million for the fourth quarter 2015.  The effective tax rate was 30.5 percent for the fourth quarter 2016, compared to 22.7 percent for the third quarter 2016 and 30.6 percent for the fourth quarter 2015.  The decrease in the effective tax rate for the third quarter 2016 was due to tax credits and other adjustments recognized in the Company’s federal income tax return which was filed in the third quarter 2016.

Asset Quality
As a result of the consistent improvements in nonperforming loans and past due loans over the past several quarters, the reduction in historical loan loss ratios and net loan recoveries experienced in the fourth quarter 2016, a negative provision for loan losses of $250,000 was recorded in the fourth quarter 2016.  Net loan recoveries for the fourth quarter 2016 were $364,000, compared to third quarter 2016 net loan recoveries of $138,000 and fourth quarter 2015 net loan recoveries of $614,000.  The Company has experienced net loan recoveries in each of the past eight quarters, and in thirteen of the past fourteen quarters. Total loans past due on payments by 30 days or more amounted to $1.4 million at December 31, 2016, essentially unchanged from December 31, 2015.  Delinquency as a percentage of total loans was 0.11 percent at December 31, 2016 and 2015.
 

(1) Net interest margin on a fully tax equivalent basis is a non-GAAP measure but is customary in the banking industry.  Management believes this non-GAAP measure is useful because it ensures comparability of yields on taxable and tax-exempt investment securities.  See section on “Use of non-GAAP financial measures” for additional information.
 

Macatawa Bank Corporation 4Q Results / page 3 of 5

The allowance for loan losses of $17.0 million was 1.32 percent of total loans at December 31, 2016, compared to 1.36 percent of total loans at September 30, 2016, and 1.43 percent at December 31, 2015.  The coverage ratio of allowance for loan losses to nonperforming loans continued to be strong and significantly exceeded 1-to-1 coverage at 5,654 percent as of December 31, 2016, compared to 7,230 percent at September 30, 2016, and 2,259 percent at December 31, 2015.

At December 31, 2016, the Company's nonperforming loans were $300,000, representing 0.02 percent of total loans.  This compares to $233,000 (0.02 percent of total loans) at September 30, 2016 and $756,000 (0.06 percent of total loans) at December 31, 2015.  Other real estate owned and repossessed assets were $12.3 million at December 31, 2016, compared to $13.1 million at September 30, 2016 and $17.6 million at December 31, 2015. Total nonperforming assets, including other real estate owned and nonperforming loans, decreased by $5.8 million, or 32 percent, from December 31, 2015 to December 31, 2016.

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

 
Dollars in 000s
 
Dec 31,
2016
   
Sept 30,
2016
   
Jun 30,
2016
   
Mar 31,
2016
   
Dec 31,
2015
 
                                         
Commercial Real Estate
 
$
183
   
$
192
   
$
291
   
$
312
   
$
525
 
Commercial and Industrial
   
36
     
9
     
26
     
79
     
174
 
Total Commercial Loans
   
219
     
201
     
317
     
391
     
699
 
Residential Mortgage Loans
   
58
     
2
     
2
     
2
     
2
 
Consumer Loans
   
23
     
30
     
31
     
34
     
55
 
Total Non-Performing Loans
 
$
300
   
$
233
   
$
350
   
$
427
   
$
756
 

Total non-performing assets were $12.6 million, or 0.72 percent of total assets, at December 31, 2016.  A break-down of non-performing assets is shown in the table below.

 
Dollars in 000s
 
Dec 31,
2016
   
Sept 30,
2016
   
Jun 30,
2016
   
Mar 31,
2016
   
Dec 31,
2015
 
                                         
Non-Performing Loans
 
$
300
   
$
233
   
$
350
   
$
427
   
$
756
 
Other Repossessed Assets
   
---
     
---
     
---
     
---
     
---
 
Other Real Estate Owned
   
12,253
     
13,110
     
14,066
     
16,162
     
17,572
 
Total Non-Performing Assets
 
$
12,553
   
$
13,343
   
$
14,416
   
$
16,589
   
$
18,328
 
 

Macatawa Bank Corporation 4Q Results / page 4 of 5

Balance Sheet, Liquidity and Capital
Total assets were $1.74 billion at December 31, 2016, an increase of $87.3 million from $1.65 billion at September 30, 2016 and an increase of $11.4 million from $1.73 billion at December 31, 2015.  Year end total assets typically increase due to year end seasonal inflow of business and municipal deposits.  Total loans were $1.28 billion at December 31, 2016, an increase of $44.4 million from $1.24 billion at September 30, 2016 and an increase of $82.9 million from $1.20 billion at December 31, 2015.

Commercial loans increased by $81.4 million from December 31, 2015 to December 31, 2016, along with an increase of $1.5 million in our residential mortgage and consumer loan portfolios.  Commercial real estate loans increased by $9.3 million and commercial and industrial loans increased by $72.1 million during the same period.

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

 
Dollars in 000s
 
Dec 31,
2016
   
Sept 30,
2016
   
Jun 30,
2016
   
Mar 31,
2016
   
Dec 31,
2015
 
                               
Construction and Development
 
$
79,596
   
$
76,077
   
$
74,339
   
$
73,621
   
$
74,210
 
Other Commercial Real Estate
   
438,385
     
423,991
     
439,036
     
443,095
     
434,462
 
Commercial Loans Secured by Real Estate
   
517,981
     
500,068
     
513,375
     
516,716
     
508,672
 
Commercial and Industrial
   
449,342
     
423,102
     
381,058
     
388,625
     
377,298
 
Total Commercial Loans
 
$
967,323
   
$
923,170
   
$
894,433
   
$
905,341
   
$
885,970
 
                                         
Residential Developer Loans (a)
 
$
26,003
   
$
26,890
   
$
29,771
   
$
28,521
   
$
30,112
 
 
 
(a)
Represents the amount of loans to residential developers secured by single family residential property which is included in commercial loans secured by real estate.

At December 31, 2016, total performing loans amounted to $1.28 billion, an increase of $44.4 million from September 30, 2016 and an increase of $83.3 million from December 31, 2015.

Total deposits were $1.45 billion at December 31, 2016, up $90.1 million from $1.36 billion at September 30, 2016 and were up $13.2 million from $1.44 billion at December 31, 2015.  The increases in each period were in checking, savings and money market deposits.  Higher costing time deposits were down $13.5 million from December 31, 2015.  The Bank 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.

The Bank's 2016 year end risk-based regulatory capital ratios were at consistent levels compared to September 30, 2016, were higher than December 31, 2015 due to earnings growth, and continue to be at levels comfortably 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, 2016.
 

Macatawa Bank Corporation 4Q Results / page 5 of 5

About Macatawa Bank
Headquartered in Holland, Mich., 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 the past five consecutive years as “West Michigan’s 101 Best and Brightest Companies to Work For”. For more information, visit www.macatawabank.com.

Use of Non-GAAP Financial Measures
The presentation of net interest margin on a fully tax equivalent (“FTE”) basis is not in accordance with GAAP but is customary in the banking industry.  Management believes this non-GAAP measure is useful because it ensures comparability of yields on taxable and tax-exempt investment securities.  For further information see “Reconciliation of Net Interest Margin, Fully Taxable Equivalent (Non-GAAP)” in the Selected Consolidated Financial Data section that follows.
 
 
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 "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 yield compression 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, extend, 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, 2015.  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
 
2016
   
2016
   
2015
   
2016
   
2015
 
Total interest income
 
$
13,496
   
$
13,122
   
$
12,709
   
$
52,499
   
$
49,386
 
Total interest expense
   
1,204
     
1,220
     
1,248
     
4,959
     
5,306
 
Net interest income
   
12,292
     
11,902
     
11,461
     
47,540
     
44,080
 
Provision for loan losses
   
(250
)
   
(250
)
   
(1,750
)
   
(1,350
)
   
(3,500
)
Net interest income after provision for loan losses
   
12,542
     
12,152
     
13,211
     
48,890
     
47,580
 
                                         
NON-INTEREST INCOME
                                       
Deposit service charges
   
1,113
     
1,152
     
1,129
     
4,425
     
4,377
 
Net gains on mortgage loans
   
789
     
1,175
     
675
     
3,024
     
2,925
 
Trust fees
   
810
     
790
     
759
     
3,096
     
2,927
 
Other
   
2,144
     
1,958
     
1,940
     
8,529
     
7,564
 
Total non-interest income
   
4,856
     
5,075
     
4,503
     
19,074
     
17,793
 
                                         
NON-INTEREST EXPENSE
                                       
Salaries and benefits
   
6,345
     
6,166
     
6,194
     
24,867
     
24,668
 
Occupancy
   
1,005
     
901
     
891
     
3,789
     
3,714
 
Furniture and equipment
   
780
     
772
     
806
     
3,256
     
3,237
 
FDIC assessment
   
140
     
166
     
283
     
778
     
1,137
 
Problem asset costs, including losses
   
100
     
325
     
1,720
     
1,295
     
3,032
 
Other
   
3,118
     
2,943
     
2,721
     
11,797
     
11,165
 
Total non-interest expense
   
11,488
     
11,273
     
12,615
     
45,782
     
46,953
 
Income before income tax
   
5,910
     
5,954
     
5,099
     
22,182
     
18,420
 
Income tax expense
   
1,802
     
1,350
     
1,561
     
6,231
     
5,626
 
Net income
 
$
4,108
   
$
4,604
   
$
3,538
   
$
15,951
   
$
12,794
 
                                         
Basic earnings per common share
 
$
0.12
   
$
0.14
   
$
0.10
   
$
0.47
   
$
0.38
 
Diluted earnings per common share
 
$
0.12
   
$
0.14
   
$
0.10
   
$
0.47
   
$
0.38
 
Return on average assets
   
0.97
%
   
1.10
%
   
0.85
%
   
0.95
%
   
0.79
%
Return on average equity
   
10.08
%
   
11.50
%
   
9.40
%
   
10.06
%
   
8.68
%
Net interest margin (fully taxable equivalent)(1)
   
3.17
%
   
3.08
%
   
3.03
%
   
3.11
%
   
3.01
%
Efficiency ratio
   
66.99
%
   
66.40
%
   
79.02
%
   
68.73
%
   
75.89
%
 

BALANCE SHEET DATA
 
December 31
   
September 30
   
December 31
 
Assets
 
2016
   
2016
   
2015
 
Cash and due from banks
 
$
27,690
   
$
31,879
   
$
29,104
 
Federal funds sold and other short-term investments
   
62,129
     
25,872
     
152,372
 
Interest-bearing time deposits in other financial institutions
   
---
     
---
     
20,000
 
Securities available for sale
   
184,433
     
184,403
     
166,815
 
Securities held to maturity
   
69,378
     
58,893
     
51,856
 
Federal Home Loan Bank Stock
   
11,558
     
11,558
     
11,558
 
Loans held for sale
   
2,181
     
2,013
     
2,776
 
Total loans
   
1,280,812
     
1,236,395
     
1,197,932
 
Less allowance for loan loss
   
16,962
     
16,847
     
17,081
 
Net loans
   
1,263,850
     
1,219,548
     
1,180,851
 
Premises and equipment, net
   
50,026
     
50,174
     
51,456
 
Bank-owned life insurance
   
39,274
     
39,088
     
28,858
 
Other real estate owned
   
12,253
     
13,110
     
17,572
 
Other assets
   
18,241
     
17,148
     
16,425
 
                         
Total Assets
 
$
1,741,013
   
$
1,653,686
   
$
1,729,643
 
                         
Liabilities and Shareholders' Equity
                       
Noninterest-bearing deposits
 
$
501,478
   
$
455,164
   
$
477,032
 
Interest-bearing deposits
   
947,246
     
903,463
     
958,480
 
Total deposits
   
1,448,724
     
1,358,627
     
1,435,512
 
Other borrowed funds
   
84,173
     
84,173
     
96,169
 
Long-term debt
   
41,238
     
41,238
     
41,238
 
Other liabilities
   
4,639
     
7,403
     
4,747
 
Total Liabilities
   
1,578,774
     
1,491,441
     
1,577,666
 
                         
Shareholders' equity
   
162,239
     
162,245
     
151,977
 
                         
Total Liabilities and Shareholders' Equity
 
$
1,741,013
   
$
1,653,686
   
$
1,729,643
 
 
(1)Net interest margin on a fully taxable equivalent basis is a non-GAAP measure.  For more information please refer to RECONCILIATION OF NET INTEREST MARGIN, FULLY TAXABLE EQUIVALENT (NON-GAAP) section below.
 

MACATAWA BANK CORPORATION
SELECTED CONSOLIDATED FINANCIAL DATA
(Unaudited)
(Dollars in thousands except per share information)
 
   
Quarterly
   
Year to Date
 
   
4th Qtr
2016
   
3rd Qtr
2016
   
2nd Qtr
2016
   
1st Qtr
2016
   
4th Qtr
2015
   
2016
   
2015
 
EARNINGS SUMMARY
                                         
Net interest income
 
$
12,292
   
$
11,902
   
$
11,608
   
$
11,738
   
$
11,461
   
$
47,540
   
$
44,080
 
Provision for loan losses
   
(250
)
   
(250
)
   
(750
)
   
(100
)
   
(1,750
)
   
(1,350
)
   
(3,500
)
Total non-interest income
   
4,856
     
5,075
     
4,536
     
4,608
     
4,503
     
19,074
     
17,793
 
Total non-interest expense
   
11,488
     
11,273
     
11,470
     
11,551
     
12,615
     
45,782
     
46,953
 
Federal income tax expense
   
1,802
     
1,350
     
1,679
     
1,400
     
1,561
     
6,231
     
5,626
 
Net income
 
$
4,108
   
$
4,604
   
$
3,745
   
$
3,495
   
$
3,538
   
$
15,951
   
$
12,794
 
     
30.49
%
   
22.67
%
   
30.96
%
   
28.60
%
   
30.61
%
   
28.09
%
   
30.54
%
Basic earnings per common share
 
$
0.12
   
$
0.14
   
$
0.11
   
$
0.10
   
$
0.10
   
$
0.47
   
$
0.38
 
Diluted earnings per common share
 
$
0.12
   
$
0.14
   
$
0.11
   
$
0.10
   
$
0.10
   
$
0.47
   
$
0.38
 
                                                         
MARKET DATA
                                                       
Book value per common share
 
$
4.78
   
$
4.78
   
$
4.67
   
$
4.58
   
$
4.48
   
$
4.78
   
$
4.48
 
Tangible book value per common share
 
$
4.78
   
$
4.78
   
$
4.67
   
$
4.58
   
$
4.48
   
$
4.78
   
$
4.48
 
Market value per common share
 
$
10.41
   
$
7.99
   
$
7.42
   
$
6.25
   
$
6.05
   
$
10.41
   
$
6.05
 
Average basic common shares
   
33,920,535
     
33,921,599
     
33,922,506
     
33,925,113
     
33,891,429
     
33,922,548
     
33,891,429
 
Average diluted common shares
   
33,923,371
     
33,921,599
     
33,922,506
     
33,925,113
     
33,891,429
     
33,922,548
     
33,891,429
 
Period end common shares
   
33,940,788
     
33,920,740
     
33,922,289
     
33,925,113
     
33,925,113
     
33,940,788
     
33,925,113
 
                                                         
PERFORMANCE RATIOS
                                                       
Return on average assets
   
0.97
%
   
1.10
%
   
0.91
%
   
0.84
%
   
0.85
%
   
0.95
%
   
0.79
%
Return on average equity
   
10.08
%
   
11.50
%
   
9.56
%
   
9.06
%
   
9.40
%
   
10.06
%
   
8.68
%
Net interest margin (fully taxable equivalent)
   
3.17
%
   
3.08
%
   
3.08
%
   
3.09
%
   
3.03
%
   
3.11
%
   
3.01
%
Efficiency ratio
   
66.99
%
   
66.40
%
   
71.05
%
   
70.67
%
   
79.02
%
   
68.73
%
   
75.89
%
Full-time equivalent employees (period end)
   
342
     
337
     
343
     
338
     
342
     
342
     
342
 
                                                         
ASSET QUALITY
                                                       
Gross charge-offs
 
$
47
   
$
46
   
$
36
   
$
76
   
$
252
   
$
205
   
$
702
 
Net charge-offs
 
$
(364
)
 
$
(138
)
 
$
(580
)
 
$
(148
)
 
$
(614
)
 
$
(1,231
)
 
$
(1,619
)
Net charge-offs to average loans (annualized)
   
-0.12
%
   
-0.05
%
   
-0.19
%
   
-0.05
%
   
-0.21
%
   
-0.10
%
   
-0.14
%
Nonperforming loans
 
$
300
   
$
233
   
$
350
   
$
427
   
$
756
   
$
300
   
$
756
 
Other real estate and repossessed assets
 
$
12,253
   
$
13,110
   
$
14,066
   
$
16,162
   
$
17,572
   
$
12,253
   
$
17,572
 
Nonperforming loans to total loans
   
0.02
%
   
0.02
%
   
0.03
%
   
0.04
%
   
0.06
%
   
0.02
%
   
0.06
%
Nonperforming assets to total assets
   
0.72
%
   
0.81
%
   
0.87
%
   
1.01
%
   
1.06
%
   
0.72
%
   
1.06
%
Allowance for loan losses
 
$
16,962
   
$
16,847
   
$
16,959
   
$
17,129
   
$
17,081
   
$
16,962
   
$
17,081
 
Allowance for loan losses to total loans
   
1.32
%
   
1.36
%
   
1.40
%
   
1.41
%
   
1.43
%
   
1.32
%
   
1.43
%
Allowance for loan losses to nonperforming loans
   
5654.00
%
   
7230.47
%
   
4845.43
%
   
4011.48
%
   
2259.39
%
   
5654.00
%
   
2259.39
%
                                                         
CAPITAL
                                                       
Average equity to average assets
   
9.62
%
   
9.53
%
   
9.47
%
   
9.27
%
   
9.07
%
   
9.47
%
   
9.10
%
Common equity tier 1 to risk weighted assets (Consolidated)
   
11.03
%
   
11.30
%
   
11.14
%
   
10.95
%
   
10.75
%
   
11.04
%
   
10.75
%
Tier 1 capital to average assets (Consolidated)
   
12.01
%
   
11.97
%
   
11.93
%
   
11.69
%
   
11.54
%
   
12.02
%
   
11.54
%
Total capital to risk-weighted assets (Consolidated)
   
14.88
%
   
15.30
%
   
15.18
%
   
15.01
%
   
14.80
%
   
14.88
%
   
14.80
%
Common equity tier 1 to risk weighted assets (Bank)
   
13.35
%
   
13.71
%
   
13.59
%
   
13.41
%
   
13.22
%
   
13.35
%
   
13.22
%
Tier 1 capital to average assets (Bank)
   
11.69
%
   
11.64
%
   
11.61
%
   
11.38
%
   
11.24
%
   
11.69
%
   
11.24
%
Total capital to risk-weighted assets (Bank)
   
14.49
%
   
14.90
%
   
14.80
%
   
14.63
%
   
14.43
%
   
14.50
%
   
14.43
%
Tangible common equity to assets
   
9.33
%
   
9.82
%
   
9.52
%
   
9.47
%
   
8.79
%
   
9.33
%
   
8.79
%
                                                         
END OF PERIOD BALANCES
                                                       
Total portfolio loans
 
$
1,280,812
   
$
1,236,395
   
$
1,211,844
   
$
1,216,184
   
$
1,197,932
   
$
1,280,812
   
$
1,197,932
 
Earning assets
   
1,612,533
     
1,514,797
     
1,539,877
     
1,518,752
     
1,602,599
     
1,612,533
     
1,602,599
 
Total assets
   
1,741,013
     
1,653,686
     
1,666,547
     
1,639,985
     
1,729,643
     
1,741,013
     
1,729,643
 
Deposits
   
1,448,724
     
1,358,627
     
1,355,078
     
1,340,834
     
1,435,512
     
1,448,724
     
1,435,512
 
Total shareholders' equity
   
162,239
     
162,245
     
158,462
     
155,241
     
151,977
     
162,239
     
151,977
 
                                                         
AVERAGE BALANCES
                                                       
Total portfolio loans
 
$
1,245,093
   
$
1,215,953
   
$
1,212,836
   
$
1,202,682
   
$
1,190,328
   
$
1,219,203
   
$
1,151,438
 
Earning assets
   
1,566,238
     
1,555,550
     
1,531,535
     
1,539,166
     
1,527,116
     
1,548,192
     
1,484,275
 
Total assets
   
1,696,007
     
1,680,097
     
1,654,325
     
1,663,590
     
1,660,869
     
1,673,584
     
1,618,776
 
Deposits
   
1,401,186
     
1,377,462
     
1,346,703
     
1,365,881
     
1,365,990
     
1,372,898
     
1,329,345
 
Total shareholders' equity
   
163,092
     
160,196
     
156,664
     
154,244
     
150,583
     
158,566
     
147,336
 
                                                         
RECONCILIATION OF NET INTEREST MARGIN, FULLY TAXABLE EQUIVALENT (NON-GAAP)
                                 
Net interest income
 
$
12,292
   
$
11,902
   
$
11,608
   
$
11,738
   
$
11,461
   
$
47,540
   
$
44,080
 
Plus taxable equivalent adjustment
   
222
     
193
     
189
     
186
     
190
     
609
     
597
 
Net interest income - taxable equivalent
 
$
12,514
   
$
12,095
   
$
11,797
   
$
11,924
   
$
11,651
   
$
48,149
   
$
44,677
 
Net interest margin (GAAP)
   
3.11
%
   
3.04
%
   
3.06
%
   
3.06
%
   
2.98
%
   
3.07
%
   
2.97
%
Net interest margin (FTE) - non-GAAP
   
3.17
%
   
3.08
%
   
3.08
%
   
3.09
%
   
3.03
%
   
3.11
%
   
3.01
%