Mercantile Bank Corporation · NASDAQ:MBWM
Mercantile Bank — Shareholder Meeting (May 2023)
24 slides from Mercantile Bank's shareholder meeting presentation, May 25, 2023
Slide 1: Annual Meeting of Shareholders May 25, 2023
Aercantile ANNUAL MEETING OP SrARZSrIOLDERS MAY 25; 2028
Slide 2: Introductory Comments
INTRODUCTORY COMMENTS CALL THE MEETING TO ORDER INTRODUCTION OF PRESENTERS APPROVAL OF MINUTES SHAREHOLDER PROPOSALS Election of Six Directors (each for a one-year term) Approval of the Mercantile Bank Corporation Stock Incentive Plan of 2023 Ratification of Plante & Moran, PLLC as Independent Publi
Slide 3: Robert B. Kaminski, Jr., President and CEO
ROBERT B. KAMINSKI, JR. President and Chief Executive Officer AMercantile Bank Corporation ANNUAL MEE SHAREHOLD
Slide 4: Annual Reports
A bg s A Mercantile Overview Stock Filings Financials News &Market Data Resources &\ Bank Corporation AMercantile Bank Corporation Annual Reports ANNUAL REPORT & Mercantile Bank Corporation
Slide 5: Directors
Retired Owner Owner Real Estate Executive Jireh Metal Products, Inc. Clear Ridge Wealth Management President and Chairman of the Board Retired Chief Executive Officer Retired Banking Executive Banking Fxecutive
Slide 6: Accounting Firm and Legal Counsel
Accounting Firm Legal Counsel Legal Counsel Plante & Moran, PLLC Dickinson Wright, PLLC Dickinson Wright, PLLC
Slide 7: Shareholder Proxy
SHAREHOLDER DAVID M. MICHELLE L. CASSARD ELDRIDGE Director Director Shareholder Proxy Shareholder Proxy AMercantile Bank Corporation Al
Slide 8: Presentation By
PRESENTATION BY RAYMOND E. REITSMA CHARLES E. CHRISTMAS Executive Vice President Executive Vice President Chief Operating Officer Chief Financial Officer and President of the Bank and Treasurer Mercantile Bank Corporation
Slide 9: Forward-Looking Statements
Company Overview Forward-Looking Statements Forward-Looking Statements This presentation contains statements or information that may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words
Slide 10: A Commitment to Excellence
Company Overview A Commitment to Excellence Performance Highlights • Relationship Banking Model NASDAQ: • Diversified Lending & Deposit Base MBWM • Pristine Asset Quality • Strong Capital Position $435M MARKET CAP • Solid Earnings Performance • Strong Loan Pipelines $4.9B TOTAL ASSETS $4.0B TOTAL LO
Slide 11: Strong Credit Culture
Strong Credit Culture Total Loans* ($ in thousands) Balance Percentage Commercial Loans Commercial and Industrial $ 1,173,500 30% Real Estate – Non-Owner Occupied $ 1,051,200 26% Real Estate – Owner Occupied $ 630,200 16% Real Estate – Multi-Family & Residential Rental $ 219,300 5% Real Estate – Lan
Slide 12: Strong Credit Culture: Non-Owner Occupied CRE Lending
Strong Credit Non-Owner Occupied Culture Commercial Real Estate Lending* Percentage Percentage ($ in thousands) Balance of NOO CRE of Total Loans Retail $ 292,000 28% 7% Office $ 256,600 24% 6% Industrial $ 194,000 18% 5% Assisted Living $ 103,600 10% 3% Hotel $ 89,800 9% 2% Multi-Family $ 75,500 7%
Slide 13: Asset Quality
Performance Financial Asset Quality (Unaudited) ($ in thousands) Quarterly 2023 2022 2022 2022 2022 1st Qtr 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr Gross loan charge-offs $ 100 100 0 0 200 Recoveries $ 100 200 200 300 300 Net loan charge-offs (recoveries) $ 0 (100) (200) (300) (100) Net loan charge-offs (re
Slide 14: Loan Repricing
Performance Financial Loan Repricing* Commercial Retail Total Variable Rate Loans: 0 – 12 Months $ 1,993,000 66,200 2,059,200 1 – 5 Years $ 42,200 140,800 183,000 5 – 15 Years $ 59,100 356,900 416,000 Total $ 2,094,300 563,900 2,658,200 Fixed Rate Loans: 0 – 12 Months $ 135,600 7,100 142,700 1 – 5 Y
Slide 15: Deposits & Sweep Accounts
Performance Financial Deposits & Sweep Accounts* Amount Percentage Noninterest-Bearing Checking $ 1,376,800 36% Interest-Bearing Checking $ 576,700 15% Money Market $ 842,600 22% Savings $ 340,200 9% Time Under $100,000 $ 132,500 3% Time $100,000 & Over $ 329,300 9% Sweep Accounts $ 227,500 6% Total
Slide 16: Sources of Liquidity
Performance Financial Sources of Liquidity* Source Availability ($ in thousands) Unsecured Federal Funds Line of Credit $ 53,000 FHLB of Indianapolis $ 281,000 Unpledged Investments $ 365,000 *As of March 31, 2023. 14 16
Slide 17: Net Interest Margin
Performance Financial Net Interest Margin 2023 2022 2022 2022 2022 2021 2021 2021 2021 1st Qtr 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr Earning Asset Yields: Loans 5.90% 5.49% 4.56% 3.97% 3.87% 4.07% 4.07% 3.99% 4.03% Investments 1.95% 1.91% 1.79% 1.68% 1.52% 1.46% 1.46% 1.54%
Slide 18: Investment Portfolio Gains & Losses
Performance Financial Investment Portfolio Gains & Losses ($ in thousands) As of March 31, 2023 Amortized Unrealized Unrealized Fair Cost Gains Losses Value U.S. Gov't Agency Bonds $ 454,000 - 57,800 396,200 Municipal Bonds - GO $ 168,700 1,100 6,700 163,100 Municipal Bonds - Revenue $ 30,800 200 2,
Slide 19: Capital: Regulatory Ratios
Performance Financial Capital Regulatory Ratios ($ in thousands) 3/31/23 12/31/22 9/30/22 6/30/22 3/31/22 12/31/21 9/30/21 6/30/21 3/31/21 As Reported: Tier 1 Leverage Capital Ratio 12.16% 11.55% 11.00% 10.75% 10.50% 10.40% 9.25% 9.40% 9.45% Total Risk-Based Capital Ratio 13.81% 13.65% 13.35% 13.45%
Slide 20: Thoughts on Remainder of 2023
Performance Financial Thoughts on Remainder of 2023 Rising Prime/LIBOR/SOFR Rates Federal funds rate remains unchanged during the remainder of 2023. Performance Metrics 2nd Qtr 3rd Qtr 4th Qtr Loan Growth 6.00% – 8.00% 6.00% – 8.00% 6.00% – 8.00% Net Interest Margin 3.85% – 3.95% 3.70% – 3.80% 3.60%
Slide 21: Shareholder Proposals
Election of Six Directors (each for a one-year term) Approval of the Mercantile Bank Corporation Stock Incentive Plan of 2023 Ratification of Plante & Moran, PLLC as Independent Registered Public Accounting Firm for 2023 Advisory Approval of the Compensation of the Named Executive Officers AMercanti
Slide 22: Accounting Firm and Legal Counsel
Accounting Firm Legal Counsel Legal Counsel Plante & Moran, PLLC Dickinson Wright, PLLC Dickinson Wright, PLLC
Slide 23: Presenters
President and Executive Vice President Executive Vice President Chief Executive Officer Chief Operating Officer Chief Financial Officer and President of the Bank and Treasurer
Slide 24: Thank You
AW eicanule THANK YOU NASDAQ Global Select Market Symbol: MBWM 310 Leonard Street NW, Grand Rapids, MI 49504 616.406.3000 or 800.453.8700 www.mercbank.com