Business
Merchants Bancorp : Investor Overview - Third Quarter 2025
Merchants Bancorp : Investor Overview - Third Quarter
About this update from Merchants Bancorp
Investor Overview Third Quarter 2025 1.27 Dividend Yield (%) (2) Carmel, IN Headquarters $19.4 Assets ($B) Business Summary (2) Overview of Merchants Bancorp (MBIN) Overview of Merchants Merchants Bancorp (MBIN) is a diversified bank holding company headquartered in Carmel, IN - $19.4B in assets as of 09/30/2025 Stock Price ($) (2) $31.48 Market Value ($M) (2) $1,445 Price / TBV (x) (2) 0.87x Price / 2025 EPS (x) (2) 9.0x $13.9B in deposits as of 09/30/2025 Operates 7 bank branches located in Indianapolis and Richmond, Indiana markets Key business lines include: Multi-family Mortgage Banking Mortgage Warehouse Banking Entrepreneurial management team with significant shareholder alignment; founding families still own ~60% of shares outstanding Price/Tangible Book Value Per Share vs Peers Gross Loans Held for Investment Composition (3Q25) (1) Healthcare Other 3Q25: Loans: $10.6B Loan Yield: 6.88% 3 Notes: Totals may not sum to 100% due to rounding Source: S&P Global; market data as of November 4, 2025 Peers MBIN Residential Real Estate 7% 1.20 1.00 0.80 Commerical & Commercial Real Estate 10% Multi-family 33% 2.00 1.80 1.60 1.40 Loans Held for Sale 28% Mortgage Warehouse 11% 1% 10% Strong Financial Performance Has Driven Significant Shareholder Value Historical Performance Since 2020 Earnings per Share (4) (6) Tangible Book Value per Share (2)(4) per share) 34.15 36.31 27.40 19.64 21.31 17.96 21.88 19.5 21.94 23.72 24.79 13.45 ($, per Share) ($, 5.64 4.76 4.47 3.85 4.35 6.30 2020 2021 2022 2023 2024 LTM 2020 2021 2022 2023 2024 3Q25 Total Assets (4) ($B) Stock Price Performance Since IPO (3) +195% Gain Since IPO vs 4% Peer Growth (5) ($) Leverage Ratio (%) (1) 18.8 19.4 17.0 12.6 9.6 11.3 10.4 11.7 10.1 11.8 8.6 2020 2021 2022 2023 2024 3Q25 12.1 50 35 $31.48 20 Oct-25 Oct-17 Oct-19 Oct-21 Oct-23 Nov-25 5 Notes: As defined by regulatory agencies; Tier 1 Leverage Ratio defined as the ratio of bank's core equity capital to its average total assets Non-GAAP financial measure; refer to reconciliations of non-GAAP financial measures in the Appendix of the presentation Source: S&P Global; market data as of November 4, 2025 Peer group source: S&P Global; Includes banks, as of December 2024, between $10-25B in assets that are publicly-traded on a major exchange. Sample includes 46 banks Peer is KBW Nasdaq Regional Bank Price Return Index LTM refers to last twelve months 4 Merchants Bancorp: Key Franchise Highlights Superior Profitability & Earnings Growth Profile in Every Interest Rate Environment Unique Originate-to-Sell Model with Differentiated Revenue Streams Reduces Earnings Volatility Highly Efficient Cost Structure, Unique Business Model Diversified, Short Duration Loan Portfolio with Strong Organic Growth Product Mix Focused on Low-Risk, Government-Backed Programs Growing Deposit Base with Multiple Sources of Funding Efficient Capital Structure Coupled with Low-Risk Balance Sheet with Optimization via Securitizations High-Quality Securities Portfolio with Minimal Mark-to-Market Impact Significant Room for Growth and History of Delivering Industry Leading Returns 5 1 Superior Profitability & Earnings Growth Profile in Every Interest Rate Environment Profitability Has Been Consistently Above Peers Net Income Over Time ($M) $320 $279 $247 $227 $220 $181 Net Interest Margin (%) 4.97% 5.19% 4.35% $320 $181 2.69% $227 $220 3.43% $279 3.06% 3.03% 2.86% $247 2.84% 2.97% 2.59% 2.79% 2.38% 1.92% 1.84% 0.52% 1.53% 0.10% Consistent NIM across all interest rate cycles 5.00% 4.00% 3.00% 2.00% 2020 2021 2022 2023 2024 (2) 09/25 YTD 1.00% -% 2020 2021 2022 2023 2024 (2) LTM Net Interest Margin Market Yield Curve Spread 1-Month SOFR Net Income Return on Average Assets (1)(3) (%) Return on Average Tangible Common Equity (1)(3) (%) 34.0% 2.12% 2.23% 30.1% 1.38% 1.99% 1.85% 1.79% 22.5% 22.9% 20.2% 0.86% 1.24% 0.95% 0.96% 1.08% 0.97% 11.0% 16.4% 16.5% 13.9% 12.1% 9.3% 8.5% 2020 2021 2022 2023 2024 09/25 YTD 2020 2021 2022 2023 2024 09/25 YTD MBIN Peer Median Notes: Peer group source: S&P Global; Includes banks, as of December 2024, between $10-25B in assets that are publicly-traded on a major exchange; excludes announced merger targets. Sample includes 46 banks Net Income refers to the last twelve months as of September 30, 2025. Non-GAAP financial measure; refer to reconciliations of non-GAAP financial measures in the Appendix of the presentation 6 2 Unique Originate-to-Sell Model With Differentiated Revenue Streams Business Mix Revenue Diversification Reduces Earnings Volatility Through the Full Rate Cycle $82 $156 $98 Net Revenue by Business Line (1) ($M) $103 $287 $523 $646 $131 $338 $597 % of Total $340 $430 $427 $140 $270 45% Banking % Fee Based Revenue 38% 2020 $143 37% 2021 $157 29% 2022 $130 22% 2023 $174 23% 2024 $184 30% $73 $195 $139 $145 LTM (2) 23% 31% Mortgage Warehousing Multi-Family Mortgage Banking Multi-Family Mortgage Banking Mortgage Warehousing Banking Lender to developers of multi-family residential and healthcare properties specializing in FHA, FNMA, and FHLMC Affordable permanent loan products Tax credit syndications lead to more originations and noninterest income Revenue primarily from gain on sale of loans originated, as well as servicing fees on loans sold or retained Warehouse and commercial lender to independent mortgage banks Service custodial deposit relationships to match fund Revenue primarily from interest income and fees earned during the time that agency eligible loans are originated to mortgage bankers and are held for resale within 30 days Holds multi-family loans in portfolio Merchants Mortgage operates nationally; now offering jumbo products Merchants SBA operates primarily in the Midwest Traditional community banking in Indiana Revenue primarily from traditional interest income and gain on sale Notes: Net revenue includes net interest income after allowance for credit losses plus noninterest income; totals include revenue from "Other" segment which is not presented. LTM refers to last twelve months 7 3 Highly Efficient Cost Structure, Unique Business Model Industry Leading Efficiency Driven by a Branch Light Model Non-Interest Expense / Average Assets (1) (%) Efficiency Ratio (1)(2) 54.0% 54.4% 53.3% 57.1% 61.3% 56.1% (%) Merchants' cost structure has been approximately half of peers relative to assets Merchants has been significantly more efficient than peer group 2.2% 43.6% 2.1% 2.1% 2.2% 2.3% 2.2% 1.1% 1.2% 1.2% 1.2% 1.3% 1.6% 27.4% 28.8% 30.6% 31.0% 33.4% 2020 2021 2022 2023 2024 09/25 YTD 2020 2021 2022 2023 2024 09/25 YTD MBIN Peer Median • Credit risk transfer premiums, collateral preservation of nonperforming loans, and addition of production staff had a negative impact of 669 bps Unique Business Model Leads to an Industry Leading Expense Profile Deep relationships with end customers driving economies-of-scale across business lines High concentration of variable costs and diversified business lines and protects profitability through cycles - Low-cost structure allows for superior rates to grow core deposits Modernized infrastructure and efficient, technology-driven operation with significant operational capacity for growth Recent increases in efficiency ratio associated with credit risk transfer activity Notes: Annualized. Peer group source: S&P Global; Includes banks, as of December 2024, between $10-25B in assets that are publicly-traded on a major exchange; excludes announced merger targets. Sample includes 46 banks Non-GAAP financial measure; refer to reconciliations of non-GAAP financial measures in the Appendix of the presentation 8 4 Diversified, Short Duration Loan Portfolio with Strong Organic Growth Over Time Low-Risk Loan Composition Across Niche Products $3.1 $0.4 $0.5 $2.3 $0.7 $1.6 Loan Portfolio Growth Over Time (1) $1.5 $3.8 $14.2 $14.7 % of Total (HFI + HFS) $13.3 28% $1.5 $4.1 Held-for-Sale $1.3 $4.0 $2.4 $1.6 $3.1 27% SF / Warehouse: $3.3B Multi-Family: $0.8B $9.1 $0.8 $2.7 $0.8 $0.5 $3.3 $8.6 $10.4 $4.6 10% $1.5 10% 33% 10% $4.9 $1.5 10% 33% Commercial and Commercial Real Estate $1.1B represents Warehouse (3) Healthcare Financing Multi-Family Loans HFI + Loans HFS / Deposits (2) $1.3 9% $1.0 $0.8 $0.8 $1.4 10% $1.6 $0.5 $1.2 $3.1 $1.6 $1.0 $2.9 2020 2021 2022 2023 2024 3Q25 116% 101% 103% 95% 119% 106% 7% 11% Residential Real Estate Mortgage Warehouse Repurchase Agreements Notes: Totals for each bar may not add due to rounding; Consumer & Margin and Agriculture loans not shown for illustrative purposes due to scale Reflects gross Loans (Loans Held for Investment and Loans Held for Sale) to deposits Includes revolving lines of credit collateralized primarily by single-family mortgage servicing rights ("MSR"); MSR lines of credit balances were $0.9 billion as of 3Q25, $0.9B as of 2024, $1.1B as of 2023, $497M as of 2022, and $210M as of 2021 9 5 Product Mix Focused on Low-Risk, Government-Backed Programs Asset Quality Net Charge-Offs (Recoveries) / Avg. Loans (1)(2) (%) Merchants NCO's / Avg. Loans have been traditionally below peer group levels 0.16% 0.10% 0.09% 0.07% 0.08% 0.07% 0.03% 0.01% 0.00% 0.01% 2020 2021 2022 2023 2024 MBIN Peer Median Differentiated Risk Management Strategy Loans are predominantly underwritten to agency guidelines for take-out, with variable rates or short maturities NCOs / Avg. Loans historically been below peer levels Substantially all commercial real estate (CRE) loans are owner-occupied; office loans are not offered Notes: Peer group source: S&P Global; Includes banks, as of December 2024, between $10-25B in assets that are publicly-traded on a major exchange; excludes announced merger targets. Sample includes 46 banks Annualized 10 Attention : This is an excerpt of the original content. To continue reading it, access the original document here .