Exhibit 99.1
|
For Immediate Release
|
|
|
NASDAQ Stock Market:
|
MCBC
|
Macatawa Bank Corporation Reports
Second Quarter 2022 Results
HOLLAND, Mich. (July 28, 2022) – Macatawa Bank Corporation (NASDAQ: MCBC), the holding company for Macatawa Bank (collectively, the “Company”), today announced its results for the second quarter 2022.
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Net income of $6.6 million in second quarter 2022 versus $6.0 million in first quarter 2022 and $7.8 million in second quarter 2021
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| ● |
Net interest income of $14.8 million in second quarter 2022 versus $12.7 million in first quarter 2022 and $14.5 million in second quarter 2021
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Strong credit metrics and net loan recoveries resulted in no provision for loan losses for the quarter
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Continued loan portfolio growth – third quarter in a row
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Grew investment securities portfolio by $187.7 million in second quarter 2022 to supplement loan growth and continue strategic deployment of excess liquidity
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| ● |
Reduction of $55.0 million in FHLB borrowings, resulting in over $650,000 in annual interest expense savings
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The Company reported net income of $6.6 million, or $0.19 per diluted share, in second quarter 2022
compared to $7.8 million, or $0.23 per diluted share, in second quarter 2021. For the first six months of 2022, the Company reported net income of $12.6 million, or $0.37 per diluted share, compared to $15.6 million, or $0.46 per
diluted share, for the same period in 2021.
"We are pleased to report solid results for the second quarter of the year,” said Ronald L. Haan, President and CEO of the Company. “We are encouraged to see our
strategy of maintaining an asset-sensitive balance sheet paying off as we have entered a rising rate environment. Net interest income for the second quarter 2022 was $2.2 million higher than the first quarter 2022 and $386,000 higher than in the
second quarter 2021 reflecting benefits from federal funds rate increases and growth in our investment securities portfolio. Net interest income in the 2021 periods included high levels of fee income from PPP loans, which were mostly forgiven by
the end of 2021. We are again encouraged by our commercial loan origination activity and pipeline of new loan opportunities while maintaining strong credit quality. Regarding fee income, while
mortgage gains are down, we are experiencing increases in other areas including wealth management fees, debit card interchange income and treasury management fees. Total non-interest expenses were up only slightly in the second quarter 2022
compared to the same period in the prior year, despite significant inflationary pressure.”
Macatawa Bank Corporation 2Q Results / page 2 of 7
Mr. Haan concluded: "Consistent loan demand and rising interest rates will continue to have a positive impact on our high levels of liquidity and provide a catalyst for
strong revenue growth during the remainder of 2022. We have a strong balance sheet that is very well-positioned to deliver further improvement in operating performance throughout the remainder of the year. High inflation, higher interest rates
and continuing disruptions to the supply chain may result in additional pressure on the economy. The months ahead will undoubtedly present new challenges, and we remain committed to keeping a diligent eye on an ever-changing operating
environment.”
Operating Results
Net interest income for the second quarter 2022 totaled $14.8 million, an increase of $2.2
million from first quarter 2022 and an increase of $386,000 from the second quarter 2021. Net interest margin for second quarter 2022 was 2.19 percent, up 34 basis points from the first quarter 2022 and the same as second quarter 2021. Net interest income for the second quarter 2022 reflected $199,000 in interest and fees from loans
originated under the PPP, compared to $1.1 million in first quarter 2022 and $3.0 million in second quarter 2021. There were just $94,000 in net deferred PPP fees remaining as of June 30, 2022. Net interest income benefited in the second quarter
2022 versus the first quarter 2022 and second quarter 2021 by the significant increase in the federal funds rate in March 2022, May 2022 and June 2022, totaling 150 basis points and the related increases in rate indices impacting the Company’s
variable rate loan portfolios. 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 increased by $1.2 million over the first
quarter 2022 and by $1.8 million over the second quarter 2021.
During second quarter 2022, the Federal Home Loan Bank (“FHLB”) exercised put options on $35.0 million of advances and the Company voluntarily prepaid $20.0 million in
FHLB advances. Prepayment fees on these advances totaled $87,000 and were included in interest expense in the second quarter 2022. The elimination of these advances will save the Company over $650,000 in annual interest expense.
On July 7, 2021, the Company redeemed its remaining $20.0 million of trust preferred securities. The Company estimates that this saves approximately $600,000 of interest
expense annually, with regulatory capital remaining significantly above levels required to be categorized as well capitalized.
Macatawa Bank Corporation 2Q Results / page 3 of 7
Non-interest income increased $166,000 in second quarter 2022 compared to first quarter 2022
and decreased $1.0 million from second quarter 2021. Income from debit and credit cards was up by $163,000 in the second quarter 2022 compared to first quarter 2022 and was
up $78,000 compared to second quarter 2021. Gains on sales of mortgage loans in second quarter 2022 were down $109,000 compared to first quarter 2022 and were down $1.1 million from second quarter 2021. The Company originated $8.4 million in mortgage loans for sale in second quarter 2022 compared to $10.1 million in first quarter 2022 and $39.2 million in second quarter 2021. Deposit service charge
income, including treasury management fees, was up $7,000 in second quarter 2022 compared to first quarter 2022 and was up $153,000 from second quarter 2021. Other noninterest income was up $105,000 compared to first quarter 2022 and was down
$158,000 from second quarter 2021.
Non-interest expense was $11.9 million for second quarter 2022, compared to $11.7 million for first quarter 2022 and $11.7 million for second quarter
2021. The largest component of non-interest expense was salaries and benefits expenses. Salaries and benefits expenses were up $114,000 compared to first quarter 2022 and were down $100,000 compared to second quarter 2021. The increase compared
to first quarter 2022 was due primarily to a higher level of salary and other compensation resulting from merit adjustments to base pay effective April 1, 2022, while the decrease from second quarter 2021 was due largely to a lower level of
commissions from mortgage production as volume decreased. The table below identifies the primary components of the changes in salaries and benefits between periods.
|
Dollars in 000s
|
Q2 2022
to
Q1 2022
|
Q2 2022
to
Q2 2021
|
||||||
|
Salaries and other compensation
|
$
|
146
|
$
|
63
|
||||
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Salary deferral from commercial loans
|
(4
|
)
|
50
|
|||||
|
Bonus accrual
|
(1
|
)
|
3
|
|||||
|
Mortgage production – variable comp
|
(3
|
)
|
(239
|
)
|
||||
|
401k matching contributions
|
(24
|
)
|
85
|
|||||
|
Medical insurance costs
|
---
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(62
|
)
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|||||
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Total change in salaries and benefits
|
$
|
114
|
$
|
(100
|
)
|
|||
Occupancy expenses were down $102,000 in second quarter 2022 compared to first quarter 2022 and were up $76,000 compared to the second quarter 2021.
Occupancy expenses in first quarter 2022 were elevated due to higher snow removal expenses. The increase compared to second quarter 2021 was due to higher building maintenance costs incurred in the second quarter 2022. FDIC assessment expense was
$197,000 in second quarter 2022 compared to $180,000 in first quarter 2022 and $159,000 in second quarter 2021. FDIC assessment expense is impacted by changes in deposit balances between periods. Legal and professional fees were up $77,000 in
second quarter 2022 compared to first quarter 2022 and were down $3,000 compared to second quarter 2021. The increase in second quarter 2022 includes higher regulatory examination fees and legal expense, which was down in first quarter 2022. Data
processing expenses were up $41,000 in second quarter 2022 compared to first quarter 2022 and were up $69,000 compared to second quarter 2021. Other categories of non-interest expense were relatively flat compared to first quarter 2022 and second
quarter 2021 due to a continued focus on expense management.
Federal income tax expense was $1.5 million for second quarter 2022, $1.4 million for first quarter 2022, and $1.8 million for second quarter 2021. The
effective tax rate was 18.5 percent for second quarter 2022, compared to 18.8 percent for first quarter 2022 and 19.1 percent for second quarter 2021.
Macatawa Bank Corporation 2Q Results / page 4 of 7
Asset Quality
No provision for loan losses was recorded in second quarter 2022 while a provision benefit
of $1.5 million was recorded in first quarter 2022 and a provision benefit of $750,000 was recorded in second quarter 2021. Net loan recoveries for second quarter 2022 were $15,000, compared to first quarter 2022 net loan recoveries of $227,000
and second quarter 2021 net loan recoveries of $104,000. At June 30, 2022, the Company had experienced net loan recoveries in twenty-eight of the past thirty quarters. Total loans past due on payments by 30 days or more amounted to $197,000 at
June 30, 2022, versus $171,000 at March 31, 2022 and $126,000 at June 30, 2021. Delinquencies at June 30, 2022 were comprised of just five individual loans. Delinquency as a percentage of total loans was just 0.02 percent at June 30, 2022, well below the Company’s peer level.
The allowance for loan losses of $14.6 million was 1.32 percent of total loans at June 30, 2022, compared to $14.6 million or 1.33 percent of total loans
at March 31, 2022, and $16.8 million or 1.36 percent at June 30, 2021. The ratio at June 30, 2022, March 31, 2022 and June 30, 2021 includes PPP loans, which are fully guaranteed by the SBA and receive no allowance allocation. The ratio excluding
PPP loans was 1.32 percent at June 30, 2022, 1.34 percent at March 31, 2022 and 1.57 percent at June 30, 2021. The coverage ratio of allowance for loan losses to nonperforming loans continued to be strong and significantly exceeded 1-to-1 coverage
at 163-to-1 as of June 30, 2022.
At June 30, 2022, the Company's nonperforming loans were $90,000, representing 0.01 percent of total loans. This compares to $90,000 (0.01 percent of
total loans) at March 31, 2022 and $433,000 (0.03 percent of total loans) at June 30, 2021. Other real estate owned and repossessed assets were $2.3 million at June 30, 2022, compared to $2.3 million at March 31, 2022 and $2.3 million at June 30,
2021. Total non-performing assets, including other real estate owned and nonperforming loans, were $2.4 million, or 0.09 percent of total assets, at June 30, 2022. Total nonperforming assets, including other real estate owned and nonperforming
loans, decreased by $343,000 from June 30, 2021 to June 30, 2022.
A break-down of non-performing loans is shown in the table below.
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Dollars in 000s
|
June 30,
2022
|
Mar 31,
2022
|
Dec 31,
2021
|
Sept 30,
2021
|
June 30,
2021
|
|||||||||||||||
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Commercial Real Estate
|
$
|
5
|
$
|
5
|
$
|
5
|
$
|
332
|
$
|
341
|
||||||||||
|
Commercial and Industrial
|
1
|
1
|
1
|
---
|
---
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|||||||||||||||
|
Total Commercial Loans
|
6
|
6
|
6
|
332
|
341
|
|||||||||||||||
|
Residential Mortgage Loans
|
84
|
84
|
86
|
88
|
92
|
|||||||||||||||
|
Consumer Loans
|
---
|
---
|
---
|
---
|
---
|
|||||||||||||||
|
Total Non-Performing Loans
|
$
|
90
|
$
|
90
|
$
|
92
|
$
|
420
|
$
|
433
|
||||||||||
Macatawa Bank Corporation 2Q Results / page 5 of 7
A break-down of non-performing assets is shown in the table below.
|
Dollars in 000s
|
June 30,
2022
|
Mar 31,
2022
|
Dec 31,
2021
|
Sept 30,
2021
|
June 30,
2021
|
|||||||||||||||
|
Non-Performing Loans
|
$
|
90
|
$
|
90
|
$
|
92
|
$
|
420
|
$
|
433
|
||||||||||
|
Other Repossessed Assets
|
---
|
---
|
---
|
---
|
---
|
|||||||||||||||
|
Other Real Estate Owned
|
2,343
|
2,343
|
2,343
|
2,343
|
2,343
|
|||||||||||||||
|
Total Non-Performing Assets
|
$
|
2,433
|
$
|
2,433
|
$
|
2,435
|
$
|
2,763
|
$
|
2,776
|
||||||||||
Balance Sheet, Liquidity and Capital
Total assets were $2.78 billion at June 30, 2022, a decrease of $148.7 million from $2.93 billion at March 31, 2022 and a decrease of $159.9 million from
$2.94 billion at June 30, 2021. Assets were elevated at each period-end due to customers holding a higher level of deposits during the COVID-19 pandemic, including balances from PPP loan proceeds.
The Company continued to increase its investment portfolio to deploy some of its excess liquidity. 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 $788.3 million at June 30, 2022, an increase of $187.7 million from $600.7 million at March 31, 2022 and an increase
of $426.5 million from $361.8 million at June 30, 2021.
Total loans were $1.11 billion at June 30, 2022, an increase of $10.0 million from $1.10 billion at March 31, 2022 and a decrease of $126.4 million from
$1.24 billion at June 30, 2021.
Commercial loans decreased by $129.7 million from June 30, 2021 to June 30, 2022, partially offset by an increase of $1.6 million in the residential
mortgage portfolio, and an increase of $1.7 million in the consumer loan portfolio. Within commercial loans, commercial real estate loans decreased by $10.8 million and commercial and industrial loans decreased by $118.9 million. However, the
largest decrease in commercial loans was in PPP loans which decreased by $166.9 million due to forgiveness by the SBA. Excluding PPP loans, total commercial loans increased by $37.1 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 as pandemic risks to economic conditions decrease.
The composition of the commercial loan portfolio is shown in the table below:
|
Dollars in 000s
|
June 30,
2022
|
Mar 31,
2022
|
Dec 31,
2021
|
Sept 30,
2021
|
June 30,
2021
|
|||||||||||||||
|
Construction and Development
|
$
|
107,325
|
$
|
104,945
|
$
|
103,755
|
$
|
104,636
|
$
|
102,608
|
||||||||||
|
Other Commercial Real Estate
|
411,778
|
417,368
|
412,346
|
422,574
|
427,291
|
|||||||||||||||
|
Commercial Loans Secured by Real Estate
|
519,103
|
522,313
|
516,101
|
527,210
|
529,899
|
|||||||||||||||
|
Commercial and Industrial
|
407,788
|
402,854
|
378,318
|
356,812
|
359,846
|
|||||||||||||||
|
Paycheck Protection Program
|
2,791
|
7,393
|
41,939
|
77,571
|
169,679
|
|||||||||||||||
|
Total Commercial Loans
|
$
|
929,682
|
$
|
932,560
|
$
|
936,358
|
$
|
961,593
|
$
|
1,059,424
|
||||||||||
Macatawa Bank Corporation 2Q Results / page 6 of 7
Bank owned life insurance was $53.0 million at June 30, 2022, up $243,000 from $52.7 million at March 31, 2022 and up $456,000 from $52.5 million at June
30, 2021 due to earnings on the underlying investments.
Total deposits were $2.49 billion at June 30, 2022, down $87.7 million, or 3.4 percent, from $2.58 billion at March 31, 2022 and down $105.5 million, or
4.1 percent, from $2.60 billion at June 30, 2021. Demand deposits were down $53.7 million at the end of the second quarter 2022 compared to the end of the first quarter 2022 and were down $154.6 million compared to the end of the second quarter
2021. Money market deposits and savings deposits were down $31.2 million from the end of the first quarter 2022 and were up $63.0 million from the end of the second quarter 2021. Certificates of deposit were down $7.8 million at June 30, 2022
compared to March 31, 2022 and were down $13.9 million compared to June 30, 2021 as customers reacted to changes in market interest rates. As deposit rates dropped during the pandemic, the Company experienced some shifting between deposit types
and, while balances have decreased over the last year, overall, deposit customers are continuing to hold higher levels of liquid deposit balances due to uncertainty related to economic conditions. 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 $30.0 million at June 30, 2022 were down $55.0 million compared to
$85.0 million at March 31, 2022 and were down $30.0 million compared to $60.0 million at June 30, 2021. The decrease in the second quarter 2022 was largely due to the FHLB exercising its put options on a $25.0 million advance carrying a rate of
0.05% and a $10.0 million advance carrying a rate of 0.45%. Both advances were repaid by the Company during the second quarter 2022. In addition, during the second quarter 2022, the Company prepaid $20.0
million in FHLB advances, with interest rates ranging from 2.91% to 3.05%. Prepayment fees totaled $87,000 and were included in interest expense in the second quarter 2022. Paying these advances off early will save the Company over $650,000 in
annual interest expense, net of the prepayment fees incurred.
Long-term debt decreased by $20.6 million from June 30, 2021 to June 30, 2022 due to the redemption of the Company’s remaining $20.6 million trust
preferred securities on July 7, 2021. The Company had no long-term debt remaining at June 30, 2022.
The Company's total risk-based regulatory capital ratio at June 30, 2022 was consistent with the ratio at December 31, 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 June 30, 2022.
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.
Macatawa Bank Corporation 2Q Results / page 7 of 7
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 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, future interest rates 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, 2021. 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.
Contact:
|
Jon W. Swets
|
|
|
Chief Financial Officer
|
|
|
616-494-7645
|
|
|
jswets@macatawabank.com
|
|
MACATAWA BANK CORPORATION
CONSOLIDATED FINANCIAL SUMMARY
(Unaudited)
(Dollars in thousands except per share information)
|
|
Quarterly
|
Six Months Ended
June 30
|
|||||||||||||||||||
|
EARNINGS SUMMARY
|
2nd Qtr
2022
|
1st Qtr
2022
|
2nd Qtr
2021
|
|||||||||||||||||
|
2022
|
2021
|
|||||||||||||||||||
|
Total interest income
|
$
|
15,435
|
$
|
13,143
|
$
|
15,184
|
$
|
28,578
|
$
|
30,458
|
||||||||||
|
Total interest expense
|
592
|
478
|
727
|
1,070
|
1,511
|
|||||||||||||||
|
Net interest income
|
14,843
|
12,665
|
14,457
|
27,508
|
28,947
|
|||||||||||||||
|
Provision for loan losses
|
-
|
(1,500
|
)
|
(750
|
)
|
(1,500
|
)
|
(750
|
)
|
|||||||||||
|
Net interest income after provision for loan losses
|
14,843
|
14,165
|
15,207
|
29,008
|
29,697
|
|||||||||||||||
|
|
||||||||||||||||||||
|
NON-INTEREST INCOME
|
||||||||||||||||||||
|
Deposit service charges
|
1,218
|
1,211
|
1,065
|
2,430
|
2,057
|
|||||||||||||||
|
Net gains on mortgage loans
|
199
|
308
|
1,311
|
508
|
3,326
|
|||||||||||||||
|
Trust fees
|
1,096
|
1,088
|
1,133
|
2,184
|
2,138
|
|||||||||||||||
|
Other
|
2,618
|
2,358
|
2,660
|
4,974
|
5,186
|
|||||||||||||||
|
Total non-interest income
|
5,131
|
4,965
|
6,169
|
10,096
|
12,707
|
|||||||||||||||
|
|
||||||||||||||||||||
|
NON-INTEREST EXPENSE
|
||||||||||||||||||||
|
Salaries and benefits
|
6,402
|
6,289
|
6,502
|
12,691
|
12,914
|
|||||||||||||||
|
Occupancy
|
1,071
|
1,172
|
994
|
2,243
|
2,031
|
|||||||||||||||
|
Furniture and equipment
|
988
|
1,016
|
978
|
2,004
|
1,915
|
|||||||||||||||
|
FDIC assessment
|
197
|
180
|
159
|
377
|
329
|
|||||||||||||||
|
Other
|
3,255
|
3,082
|
3,085
|
6,337
|
6,014
|
|||||||||||||||
|
Total non-interest expense
|
11,913
|
11,739
|
11,718
|
23,652
|
23,203
|
|||||||||||||||
|
Income before income tax
|
8,061
|
7,391
|
9,658
|
15,452
|
19,201
|
|||||||||||||||
|
Income tax expense
|
1,493
|
1,391
|
1,840
|
2,884
|
3,605
|
|||||||||||||||
|
Net income
|
$
|
6,568
|
$
|
6,000
|
$
|
7,818
|
$
|
12,568
|
$
|
15,596
|
||||||||||
|
|
||||||||||||||||||||
|
Basic earnings per common share
|
$
|
0.19
|
$
|
0.18
|
$
|
0.23
|
$
|
0.37
|
$
|
0.46
|
||||||||||
|
Diluted earnings per common share
|
$
|
0.19
|
$
|
0.18
|
$
|
0.23
|
$
|
0.37
|
$
|
0.46
|
||||||||||
|
Return on average assets
|
0.92
|
%
|
0.82
|
%
|
1.11
|
%
|
0.87
|
%
|
1.14
|
%
|
||||||||||
|
Return on average equity
|
10.80
|
%
|
9.54
|
%
|
12.79
|
%
|
10.16
|
%
|
12.85
|
%
|
||||||||||
|
Net interest margin (fully taxable equivalent)
|
2.19
|
%
|
1.85
|
%
|
2.19
|
%
|
2.02
|
%
|
2.25
|
%
|
||||||||||
|
Efficiency ratio
|
59.64
|
%
|
66.59
|
%
|
56.81
|
%
|
62.90
|
%
|
55.70
|
%
|
||||||||||
|
BALANCE SHEET DATA
Assets
|
June 30
2022
|
March 31
2022
|
June 30
2021
|
|||||||||
|
Cash and due from banks
|
$
|
38,376
|
$
|
31,957
|
$
|
31,051
|
||||||
|
Federal funds sold and other short-term investments
|
721,826
|
1,078,983
|
1,189,266
|
|||||||||
|
Debt securities available for sale
|
435,628
|
346,114
|
239,955
|
|||||||||
|
Debt securities held to maturity
|
352,721
|
254,565
|
121,867
|
|||||||||
|
Federal Home Loan Bank Stock
|
10,211
|
10,211
|
11,558
|
|||||||||
|
Loans held for sale
|
1,163
|
855
|
4,752
|
|||||||||
|
Total loans
|
1,111,915
|
1,101,902
|
1,238,327
|
|||||||||
|
Less allowance for loan loss
|
14,631
|
14,616
|
16,806
|
|||||||||
|
Net loans
|
1,097,284
|
1,087,286
|
1,221,521
|
|||||||||
|
Premises and equipment, net
|
41,088
|
41,413
|
42,906
|
|||||||||
|
Bank-owned life insurance
|
52,963
|
52,720
|
52,507
|
|||||||||
|
Other real estate owned
|
2,343
|
2,343
|
2,343
|
|||||||||
|
Other assets
|
27,605
|
23,436
|
23,360
|
|||||||||
|
|
||||||||||||
|
Total Assets
|
$
|
2,781,208
|
$
|
2,929,883
|
$
|
2,941,086
|
||||||
|
|
||||||||||||
|
Liabilities and Shareholders' Equity
|
||||||||||||
|
Noninterest-bearing deposits
|
$
|
903,334
|
$
|
918,907
|
$
|
956,961
|
||||||
|
Interest-bearing deposits
|
1,591,249
|
1,663,390
|
1,643,115
|
|||||||||
|
Total deposits
|
2,494,583
|
2,582,297
|
2,600,076
|
|||||||||
|
Other borrowed funds
|
30,000
|
85,000
|
60,000
|
|||||||||
|
Long-term debt
|
-
|
-
|
20,619
|
|||||||||
|
Other liabilities
|
13,516
|
16,984
|
12,174
|
|||||||||
|
Total Liabilities
|
2,538,099
|
2,684,281
|
2,692,869
|
|||||||||
|
|
||||||||||||
|
Shareholders' equity
|
243,109
|
245,602
|
248,217
|
|||||||||
|
|
||||||||||||
|
Total Liabilities and Shareholders' Equity
|
$
|
2,781,208
|
$
|
2,929,883
|
$
|
2,941,086
|
||||||
|
MACATAWA BANK CORPORATION
SELECTED CONSOLIDATED FINANCIAL DATA
(Unaudited)
(Dollars in thousands except per share information)
|
|
Quarterly
|
Year to Date
|
|||||||||||||||||||||||||||
|
2nd Qtr
2022
|
1st Qtr
2022
|
4th Qtr
2021
|
3rd Qtr
2021
|
|
2nd Qtr
2021
|
2022
|
2021
|
|
||||||||||||||||||||
|
EARNINGS SUMMARY
|
||||||||||||||||||||||||||||
|
Net interest income
|
$
|
14,843
|
$
|
12,665
|
$
|
12,826
|
$
|
14,296
|
$
|
14,457
|
$
|
27,508
|
$
|
28,947
|
||||||||||||||
|
Provision for loan losses
|
-
|
(1,500
|
)
|
(750
|
)
|
(550
|
)
|
(750
|
)
|
(1,500
|
)
|
(750
|
)
|
|||||||||||||||
|
Total non-interest income
|
5,131
|
4,965
|
5,346
|
5,642
|
6,169
|
10,096
|
12,707
|
|||||||||||||||||||||
|
Total non-interest expense
|
11,913
|
11,739
|
11,337
|
11,550
|
11,718
|
23,652
|
23,203
|
|||||||||||||||||||||
|
Federal income tax expense
|
1,493
|
1,391
|
1,369
|
1,736
|
1,840
|
2,884
|
3,605
|
|||||||||||||||||||||
|
Net income
|
$
|
6,568
|
$
|
6,000
|
$
|
6,216
|
$
|
7,202
|
$
|
7,818
|
$
|
12,568
|
$
|
15,596
|
||||||||||||||
|
Basic earnings per common share
|
$
|
0.19
|
$
|
0.18
|
$
|
0.18
|
$
|
0.21
|
$
|
0.23
|
$
|
0.37
|
$
|
0.46
|
||||||||||||||
|
Diluted earnings per common share
|
$
|
0.19
|
$
|
0.18
|
$
|
0.18
|
$
|
0.21
|
$
|
0.23
|
$
|
0.37
|
$
|
0.46
|
||||||||||||||
|
MARKET DATA
|
||||||||||||||||||||||||||||
|
Book value per common share
|
$
|
7.10
|
$
|
7.17
|
$
|
7.41
|
$
|
7.38
|
$
|
7.26
|
$
|
7.10
|
$
|
7.26
|
||||||||||||||
|
Tangible book value per common share
|
$
|
7.10
|
$
|
7.17
|
$
|
7.41
|
$
|
7.38
|
$
|
7.26
|
$
|
7.10
|
$
|
7.26
|
||||||||||||||
|
Market value per common share
|
$
|
8.84
|
$
|
9.01
|
$
|
8.82
|
$
|
8.03
|
$
|
8.75
|
$
|
8.84
|
$
|
8.75
|
||||||||||||||
|
Average basic common shares
|
34,253,846
|
34,254,772
|
34,229,664
|
34,190,264
|
34,193,016
|
34,254,306
|
34,194,264
|
|||||||||||||||||||||
|
Average diluted common shares
|
34,253,846
|
34,254,772
|
34,229,664
|
34,190,264
|
34,193,016
|
34,254,306
|
34,194,264
|
|||||||||||||||||||||
|
Period end common shares
|
34,253,147
|
34,253,962
|
34,259,945
|
34,189,799
|
34,192,317
|
34,253,147
|
34,192,317
|
|||||||||||||||||||||
|
PERFORMANCE RATIOS
|
||||||||||||||||||||||||||||
|
Return on average assets
|
0.92
|
%
|
0.82
|
%
|
0.85
|
%
|
0.98
|
%
|
1.11
|
%
|
0.87
|
%
|
1.14
|
%
|
||||||||||||||
|
Return on average equity
|
10.80
|
%
|
9.54
|
%
|
9.84
|
%
|
11.52
|
%
|
12.79
|
%
|
10.16
|
%
|
12.85
|
%
|
||||||||||||||
|
Net interest margin (fully taxable equivalent)
|
2.19
|
%
|
1.85
|
%
|
1.85
|
%
|
2.04
|
%
|
2.19
|
%
|
2.02
|
%
|
2.25
|
%
|
||||||||||||||
|
Efficiency ratio
|
59.64
|
%
|
66.59
|
%
|
62.39
|
%
|
57.93
|
%
|
56.81
|
%
|
62.90
|
%
|
55.70
|
%
|
||||||||||||||
|
Full-time equivalent employees (period end)
|
315
|
311
|
311
|
318
|
321
|
315
|
321
|
|||||||||||||||||||||
|
ASSET QUALITY
|
||||||||||||||||||||||||||||
|
Gross charge-offs
|
$
|
60
|
$
|
35
|
$
|
22
|
$
|
22
|
$
|
30
|
$
|
95
|
$
|
80
|
||||||||||||||
|
Net charge-offs/(recoveries)
|
$
|
(15
|
)
|
$
|
(227
|
)
|
$
|
(107
|
)
|
$
|
(276
|
)
|
$
|
(104
|
)
|
$
|
(242
|
)
|
$
|
(148
|
)
|
|||||||
|
Net charge-offs to average loans (annualized)
|
-0.01
|
%
|
-0.08
|
%
|
-0.04
|
%
|
-0.09
|
%
|
-0.03
|
%
|
-0.04
|
%
|
-0.02
|
%
|
||||||||||||||
|
Nonperforming loans
|
$
|
90
|
$
|
90
|
$
|
92
|
$
|
420
|
$
|
433
|
$
|
90
|
$
|
433
|
||||||||||||||
|
Other real estate and repossessed assets
|
$
|
2,343
|
$
|
2,343
|
$
|
2,343
|
$
|
2,343
|
$
|
2,343
|
$
|
2,343
|
$
|
2,343
|
||||||||||||||
|
Nonperforming loans to total loans
|
0.01
|
%
|
0.01
|
%
|
0.01
|
%
|
0.04
|
%
|
0.03
|
%
|
0.01
|
%
|
0.03
|
%
|
||||||||||||||
|
Nonperforming assets to total assets
|
0.09
|
%
|
0.08
|
%
|
0.08
|
%
|
0.10
|
%
|
0.09
|
%
|
0.09
|
%
|
0.09
|
%
|
||||||||||||||
|
Allowance for loan losses
|
$
|
14,631
|
$
|
14,616
|
$
|
15,889
|
$
|
16,532
|
$
|
16,806
|
$
|
14,631
|
$
|
16,806
|
||||||||||||||
|
Allowance for loan losses to total loans
|
1.32
|
%
|
1.33
|
%
|
1.43
|
%
|
1.45
|
%
|
1.36
|
%
|
1.32
|
%
|
1.36
|
%
|
||||||||||||||
|
Allowance for loan losses to total loans (excluding PPP loans)
|
1.32
|
%
|
1.34
|
%
|
1.49
|
%
|
1.56
|
%
|
1.57
|
%
|
1.32
|
%
|
1.57
|
%
|
||||||||||||||
|
Allowance for loan losses to nonperforming loans
|
16256.67
|
%
|
16240.00
|
%
|
17270.65
|
%
|
3936.19
|
%
|
3881.29
|
%
|
16256.67
|
%
|
3881.29
|
%
|
||||||||||||||
|
CAPITAL
|
||||||||||||||||||||||||||||
|
Average equity to average assets
|
8.55
|
%
|
8.62
|
%
|
8.66
|
%
|
8.48
|
%
|
8.70
|
%
|
8.59
|
%
|
8.87
|
%
|
||||||||||||||
|
Common equity tier 1 to risk weighted assets (Consolidated)
|
16.54
|
%
|
16.92
|
%
|
17.24
|
%
|
17.43
|
%
|
17.10
|
%
|
16.54
|
%
|
17.10
|
%
|
||||||||||||||
|
Tier 1 capital to average assets (Consolidated)
|
9.13
|
%
|
8.82
|
%
|
8.72
|
%
|
8.51
|
%
|
9.48
|
%
|
9.13
|
%
|
9.48
|
%
|
||||||||||||||
|
Total capital to risk-weighted assets (Consolidated)
|
17.47
|
%
|
17.88
|
%
|
18.32
|
%
|
18.58
|
%
|
19.66
|
%
|
17.47
|
%
|
19.66
|
%
|
||||||||||||||
|
Common equity tier 1 to risk weighted assets (Bank)
|
16.04
|
%
|
16.39
|
%
|
16.70
|
%
|
16.88
|
%
|
16.57
|
%
|
16.04
|
%
|
16.57
|
%
|
||||||||||||||
|
Tier 1 capital to average assets (Bank)
|
8.85
|
%
|
8.55
|
%
|
8.44
|
%
|
8.24
|
%
|
8.49
|
%
|
8.85
|
%
|
8.49
|
%
|
||||||||||||||
|
Total capital to risk-weighted assets (Bank)
|
16.97
|
%
|
17.35
|
%
|
17.77
|
%
|
18.02
|
%
|
17.73
|
%
|
16.97
|
%
|
17.73
|
%
|
||||||||||||||
|
Common equity to assets
|
8.74
|
%
|
8.38
|
%
|
8.67
|
%
|
8.69
|
%
|
8.44
|
%
|
8.74
|
%
|
8.44
|
%
|
||||||||||||||
|
Tangible common equity to assets
|
8.74
|
%
|
8.38
|
%
|
8.67
|
%
|
8.69
|
%
|
8.44
|
%
|
8.74
|
%
|
8.44
|
%
|
||||||||||||||
|
END OF PERIOD BALANCES
|
||||||||||||||||||||||||||||
|
Total portfolio loans
|
$
|
1,111,915
|
$
|
1,101,902
|
$
|
1,108,993
|
$
|
1,136,613
|
$
|
1,238,327
|
$
|
1,111,915
|
$
|
1,238,327
|
||||||||||||||
|
Earning assets
|
2,655,706
|
2,802,498
|
2,803,853
|
2,768,507
|
2,803,634
|
2,655,706
|
2,803,634
|
|||||||||||||||||||||
|
Total assets
|
2,781,208
|
2,929,883
|
2,928,751
|
2,901,500
|
2,941,086
|
2,781,208
|
2,941,086
|
|||||||||||||||||||||
|
Deposits
|
2,494,583
|
2,582,297
|
2,577,958
|
2,553,175
|
2,600,076
|
2,494,583
|
2,600,076
|
|||||||||||||||||||||
|
Total shareholders' equity
|
243,109
|
245,602
|
254,005
|
252,213
|
248,217
|
243,109
|
248,217
|
|||||||||||||||||||||
|
AVERAGE BALANCES
|
||||||||||||||||||||||||||||
|
Total portfolio loans
|
$
|
1,103,955
|
$
|
1,092,673
|
$
|
1,109,863
|
$
|
1,182,633
|
$
|
1,324,915
|
$
|
1,098,346
|
$
|
1,362,946
|
||||||||||||||
|
Earning assets
|
2,724,714
|
2,788,254
|
2,780,236
|
2,804,157
|
2,669,862
|
2,756,363
|
2,603,948
|
|||||||||||||||||||||
|
Total assets
|
2,847,381
|
2,917,462
|
2,917,569
|
2,948,664
|
2,809,487
|
2,882,228
|
2,738,539
|
|||||||||||||||||||||
|
Deposits
|
2,537,111
|
2,569,315
|
2,564,961
|
2,605,043
|
2,468,398
|
2,553,124
|
2,395,112
|
|||||||||||||||||||||
|
Total shareholders' equity
|
243,352
|
251,600
|
252,606
|
249,994
|
244,516
|
247,453
|
242,779
|
|||||||||||||||||||||