First Quarter Highlights
Highlights for the first quarter of 2025 include:
- Increase in net interest income of $0.8 million (or 1.9%) over the fourth quarter of 2024;
- Increase in tangible book value per share of $2.43 (13.2%) from March 31, 2024;
- Net growth in core deposits of $9.1 million (or 0.8% annualized) from December 31, 2024;
- Net growth in loans of $33.9 million (or 3.4% annualized) from December 31, 2024; and
- The payment of a 26 cent per share dividend on common stock on February 14, 2025.
GRAND RAPIDS, Mich., April 24, 2025 (GLOBE NEWSWIRE) -- Independent Bank Corporation (NASDAQ: IBCP) reported first quarter 2025 net income of $15.6 million, or $0.74 per diluted share, versus net income of $16.0 million, or $0.76 per diluted share, in the prior-year period.
William B. ("Brad") Kessel, the President and Chief Executive Officer of Independent Bank Corporation, commented: "I am proud of our team and very pleased to see us continue our positive trends with our first quarter 2025 results. Overall loans increased 3.4% (annualized), while core deposits are up 0.8% (annualized). We were able to generate net interest income growth on both a linked quarter basis and on a year over year quarterly basis and produce four basis points in margin expansion. We believe that our expenses continue to be well managed, and we continue to see improved operational scale from strategic investments we have made in recent years. These fundamentals continue to drive positive growth in tangible book value per share (13.2%) compared to the prior year quarter. Our credit metrics continue to be very good, with a low level of watch credits, 14 basis points of non-performing assets to total assets, and 0.01% net charge-offs for the quarter to average loans annualized. The allowance for credit losses, factoring in the recent market uncertainty, was 1.47% of total loans. We are staying in close contact with our client base during this volatile period and keeping abreast of what they are experiencing and how they are adjusting if needed. Based on a robust commercial loan pipeline, the past record of our core group of professionals and the ongoing strategic initiative to add talented bankers to our team, we continue to be focused on what we can control and optimistic on the long-term future of the IBC franchise."
Significant items impacting comparable first quarter 2025 and 2024 results include the following:
- Changes in the fair value due to price of capitalized mortgage loan servicing rights (the "MSR Changes") of $(1.5) million ($(0.06) per diluted share, after taxes) for the three-month period ended March 31, 2025, as compared to $1.3 million ($0.05 per diluted share, after taxes) for the three-months ended March 31, 2024.
Operating Results
The Company's net interest income totaled $43.7 million during the first quarter of 2025, an increase of $3.5 million, or 8.7% from the year-ago period, and an increase of $0.8 million, or 1.9%, from the fourth quarter of 2024. The Company's tax equivalent net interest income as a percent of average interest-earning assets (the "net interest margin") was 3.49% during the first quarter of 2025, compared to 3.30% in the year-ago period, and 3.45% in the fourth quarter of 2024. The year-over-year and linked quarterly increase in net interest income was due to an increase in average interest-earning assets and the net interest margin. Average interest-earning assets were $5.08 billion in the first quarter of 2025, compared to $4.91 billion in the year ago quarter and $5.01 billion in the fourth quarter of 2024.
Non-interest income totaled $10.4 million for the first quarter of 2025, compared to $12.6 million in the comparable prior year period. This change was primarily due to variances in mortgage banking related revenues.
Net gains on mortgage loans in the first quarters of 2025 and 2024 were approximately $2.3 million and $1.4 million, respectively. The comparative quarterly increase in net gains on mortgage loans was primarily due to an increase in both gain on sale margin on mortgage loans sold and an increase in the volume of mortgage loans sold.
Mortgage loan servicing, net, generated income (expense) of $(0.6) million and $2.7 million in the first quarters of 2025 and 2024, respectively. The significant variance in mortgage loan servicing, net is primarily due to changes in the fair value of capitalized mortgage loan servicing rights associated with changes in interest rates and the associated expected future prepayment levels and expected float rates as well as a decline in servicing revenue. The decline in servicing revenue is attributed to the sale of approximately $931 million of mortgage servicing rights on January 31, 2025. Capitalized mortgage loan servicing rights totaled $32.2 million and $46.8 million at March 31, 2025 and December 31, 2024, respectively. The decline during the first quarter was primarily attributed to aforementioned mortgage servicing right sale. This transaction was executed in part to reduce the amount of exposure the bank had to rate variances that may impact the mortgage servicing right asset valuation in future periods. While the magnitude of fair value adjustments would also be expected to decrease, those adjustments are dependent upon factors that are harder to predict.
Mortgage loan servicing, net activity is summarized in the following table:
| Three months ended | |||||||
| 3/31/2025 | 3/31/2024 | ||||||
| (In thousands) | |||||||
| Mortgage loan servicing, net: | |||||||
| Revenue, net | $ | 1,882 | $ | 2,219 | |||
| Fair value change due to price | (1,533 | ) | 1,265 | ||||
| Fair value change due to pay-downs | (891 | ) | (759 | ) | |||
| Loss on sale of originated servicing rights | (94 | ) | - | ||||
| Total | $ | (636 | ) | $ | 2,725 | ||
Non-interest expenses totaled $34.3 million in the first quarter of 2025, compared to $32.2 million in the year-ago period.
The Company recorded income tax expense of $3.5 million in the first quarter of 2025. This compares to an income tax expense of $3.8 million in the first quarter of 2024. The change in income tax expense principally reflects changes in pre-tax earnings in 2025 relative to 2024.
Asset Quality
A breakdown of non-performing loans by loan type is as follows (1):
| 3/31/2025 | 12/31/2024 | 3/31/2024 | |||||||||
| Loan Type | (Dollars in thousands) | ||||||||||
| Commercial | $ | 127 | $ | 54 | $ | 25 | |||||
| Mortgage | 8,080 | 7,005 | 4,620 | ||||||||
| Installment | 819 | 733 | 710 | ||||||||
| Sub total | 9,026 | 7,792 | 5,355 | ||||||||
| Less - government guaranteed loans | 1,940 | 1,790 | 1,665 | ||||||||
| Total non-performing loans | $ | 7,086 | $ | 6,002 | $ | 3,690 | |||||
| Ratio of non-performing loans to total portfolio loans | 0.17 | % | 0.15 | % | 0.10 | % | |||||
| Ratio of non-performing assets to total assets | 0.14 | % | 0.13 | % | 0.09 | % | |||||
| Ratio of allowance for credit losses to total non-performing loans | 847.23 | % | 989.32 | % | 1526.10 | % | |||||
(1) Non performing loans include non-accrual loans and loans 90 days or more past due and still accruing interest.
The provision for credit losses was an expense of $0.72 million and $0.74 million in the first quarters of 2025 and 2024, respectively. We recorded loan net charge offs of $0.07 million and $0.22 million in the first quarters of 2025 and 2024, respectively. At March 31, 2025, the allowance for credit losses for loans totaled $60.0 million, or 1.47% of total portfolio loans compared to $59.4 million, or 1.47% of total portfolio loans at December 31, 2024.
Balance Sheet, Capital and Liquidity
Total assets were $5.33 billion at March 31, 2025, a decrease of $9.7 million from December 31, 2024. Loans, excluding loans held for sale, were $4.07 billion at March 31, 2025, compared to $4.04 billion at December 31, 2024. Deposits totaled $4.63 billion at March 31, 2025, a decrease of $20.2 million from December 31, 2024. This decrease is primarily due to decreases in non-interest bearing deposits and brokered time deposits that were partially offset by increases in savings and interest-bearing checking, reciprocal and time deposits.
Cash and cash equivalents totaled $128.1 million at March 31, 2025, versus $119.9 million at December 31, 2024. Securities available for sale ("AFS") totaled $529.7 million at March 31, 2025, versus $559.2 million at December 31, 2024.
Total shareholders' equity was $467.3 million at March 31, 2025, or 8.77% of total assets compared to $454.7 million or 8.52% at December 31, 2024. Tangible common equity totaled $437.6 million at March 31, 2025, or $20.87 per share compared to $424.9 million or $20.33 per share at December 31, 2024. The increase in shareholder equity as well as tangible common equity are primarily the result of earnings retention and a decrease in accumulated other comprehensive loss.
The Company's wholly owned subsidiary, Independent Bank, remains significantly above "well capitalized" for regulatory purposes with the following ratios:
| Regulatory Capital Ratios | 3/31/2025 | 12/31/2024 | Well Capitalized Minimum | |||||
| Tier 1 capital to average total assets | 9.56 | % | 9.58 | % | 5.00 | % | ||
| Tier 1 common equity to risk-weighted assets | 11.93 | % | 11.74 | % | 6.50 | % | ||
| Tier 1 capital to risk-weighted assets | 11.93 | % | 11.74 | % | 8.00 | % | ||
| Total capital to risk-weighted assets | 13.19 | % | 12.99 | % | 10.00 | % | ||
At March 31, 2025, in addition to liquidity available from our normal operating, funding, and investing activities, we had unused credit lines with the FHLB and FRB of approximately $1.10 billion and $486.1 million, respectively. We also had approximately $501.0 million in fair value of unpledged securities AFS and HTM at March 31, 2025 which could be pledged for an estimated additional borrowing capacity at the FHLB and FRB of approximately $469.7 million.
Share Repurchase Plan
On December 17, 2024, the Board of Directors of the Company authorized the 2025 share repurchase plan. Under the terms of the 2025 share repurchase plan, the Company is authorized to purchase up to 1,100,000 shares, or approximately 5% of its then outstanding common stock. The repurchase plan is authorized to last through December 31, 2025. During the three month period ended March 31, 2025, there were 1,093 shares of common stock repurchased, for an aggregate purchase price of $0.03 million. Subsequent to quarter end, from April 3, 2025 through April 22, 2025, there were 249,482 additional shares of common stock repurchased, for an aggregate purchase price of $7.2 million.
Earnings Conference Call
Brad Kessel, President and CEO, Gavin Mohr, CFO and Joel Rahn, EVP - Commercial Banking will review the quarterly results in a conference call for investors and analysts beginning at 11:00 am ET on Thursday, April 24, 2025.
To participate in the live conference call, please dial 1-833-470-1428 (Access Code # 706949). Also, the conference call will be accessible through an audio webcast with user-controlled slides via the following site/URL: https://events.q4inc.com/attendee/106805636.
A playback of the call can be accessed by dialing 1-866-813-9403 (Access Code # 746507). The replay will be available through May 1, 2025.
About Independent Bank Corporation
Independent Bank Corporation (NASDAQ: IBCP) is a Michigan-based bank holding company with total assets of approximately $5.3 billion. Founded as First National Bank of Ionia in 1864, Independent Bank Corporation operates a branch network across Michigan's Lower Peninsula through one state-chartered bank subsidiary. This subsidiary (Independent Bank) provides a full range of financial services, including commercial banking, mortgage lending, consumer banking, investments and insurance. Independent Bank Corporation is committed to providing exceptional personal service and value to its customers, stockholders and the communities it serves.
For more information, please visit our Web site at: IndependentBank.com.
Forward-Looking Statements
This presentation contains forward-looking statements, which are any statements or information that are not historical facts. These forward-looking statements include statements about our anticipated future revenue and expenses and our future plans and prospects.
Forward-looking statements involve inherent risks and uncertainties, and important factors could cause actual results to differ materially from those anticipated. For example, deterioration in general business and economic conditions or turbulence in domestic or global financial markets could adversely affect our revenues and the values of our assets and liabilities, reduce the availability of funding to us, lead to a tightening of credit, and increase stock price volatility. Our results could also be adversely affected by changes in interest rates; increases in unemployment rates; deterioration in the credit quality of our loan portfolios or in the value of the collateral securing those loans; deterioration in the value of our investment securities; legal and regulatory developments; changes in customer behavior and preferences; breaches in data security; and management's ability to effectively manage the multitude of risks facing our business. Key risk factors that could affect our future results are described in more detail in our Annual Report on Form 10-K for the year ended December 31, 2024 and the other reports we file with the SEC, including under the heading "Risk Factors." Investors should not place undue reliance on forward-looking statements as a prediction of our future results.
Any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise.
| INDEPENDENT BANK CORPORATION AND SUBSIDIARIES Consolidated Statements of Financial Condition | ||||||||
| March 31, 2025 | December 31, 2024 | |||||||
| (Unaudited) | ||||||||
| (In thousands, except share amounts) | ||||||||
| Assets | ||||||||
| Cash and due from banks | $ | 60,566 | $ | 56,984 | ||||
| Interest bearing deposits | 67,579 | 62,898 | ||||||
| Cash and Cash Equivalents | 128,145 | 119,882 | ||||||
| Securities available for sale | 529,676 | 559,182 | ||||||
| Securities held to maturity (fair value of $302,579 at March 31, 2025 and $301,860 at December 31, 2024) | 336,928 | 339,436 | ||||||
| Federal Home Loan Bank and Federal Reserve Bank stock, at cost | 15,587 | 16,099 | ||||||
| Loans held for sale, carried at fair value | 9,514 | 7,643 | ||||||
| Loans | ||||||||
| Commercial | 1,992,187 | 1,937,364 | ||||||
| Mortgage | 1,512,807 | 1,516,726 | ||||||
| Installment | 567,697 | 584,735 | ||||||
| Total Loans | 4,072,691 | 4,038,825 | ||||||
| Allowance for credit losses | (60,035 | ) | (59,379 | ) | ||||
| Net Loans | 4,012,656 | 3,979,446 | ||||||
| Other real estate and repossessed assets, net | 413 | 938 | ||||||
| Property and equipment, net | 37,369 | 37,492 | ||||||
| Bank-owned life insurance | 53,721 | 53,855 | ||||||
| Capitalized mortgage loan servicing rights, carried at fair value | 32,171 | 46,796 | ||||||
| Other intangibles | 1,366 | 1,488 | ||||||
| Goodwill | 28,300 | 28,300 | ||||||
| Accrued income and other assets | 142,582 | 147,547 | ||||||
| Total Assets | $ | 5,328,428 | $ | 5,338,104 | ||||
| Liabilities and Shareholders' Equity | ||||||||
| Deposits | ||||||||
| Non-interest bearing | $ | 989,928 | $ | 1,013,647 | ||||
| Savings and interest-bearing checking | 2,017,800 | 1,995,314 | ||||||
| Reciprocal | 910,526 | 907,031 | ||||||
| Time | 635,172 | 628,285 | ||||||
| Brokered time | 80,505 | 109,811 | ||||||
| Total Deposits | 4,633,931 | 4,654,088 | ||||||
| Other borrowings | 45,014 | 45,009 | ||||||
| Subordinated debt | 39,605 | 39,586 | ||||||
| Subordinated debentures | 39,813 | 39,796 | ||||||
| Accrued expenses and other liabilities | 102,788 | 104,939 | ||||||
| Total Liabilities | 4,861,151 | 4,883,418 | ||||||
| Shareholders' Equity | ||||||||
| Preferred stock, no par value, 200,000 shares authorized; none issued or outstanding | - | - | ||||||
| Common stock, no par value, 500,000,000 shares authorized; issued and outstanding: 20,970,115 shares at March 31, 2025 and 20,895,714 shares at December 31, 2024 | 318,365 | 318,777 | ||||||
| Retained earnings | 215,995 | 205,853 | ||||||
| Accumulated other comprehensive loss | (67,083 | ) | (69,944 | ) | ||||
| Total Shareholders' Equity | 467,277 | 454,686 | ||||||
| Total Liabilities and Shareholders' Equity | $ | 5,328,428 | $ | 5,338,104 | ||||
| INDEPENDENT BANK CORPORATION AND SUBSIDIARIES Consolidated Statements of Operations | ||||||||||||
| Three Months Ended | ||||||||||||
| March 31, 2025 | December 31, 2024 | March 31, 2024 | ||||||||||
| (Unaudited) | ||||||||||||
| Interest Income | (In thousands, except per share amounts) | |||||||||||
| Interest and fees on loans | $ | 57,768 | $ | 58,346 | $ | 55,043 | ||||||
| Interest on securities | ||||||||||||
| Taxable | 4,036 | 4,417 | 5,251 | |||||||||
| Tax-exempt | 2,770 | 2,905 | 3,391 | |||||||||
| Other investments | 1,570 | 1,310 | 1,441 | |||||||||
| Total Interest Income | 66,144 | 66,978 | 65,126 | |||||||||
| Interest Expense | ||||||||||||
| Deposits | 20,955 | 22,546 | 22,810 | |||||||||
| Other borrowings and subordinated debt and debentures | 1,504 | 1,581 | 2,119 | |||||||||
| Total Interest Expense | 22,459 | 24,127 | 24,929 | |||||||||
| Net Interest Income | 43,685 | 42,851 | 40,197 | |||||||||
| Provision for credit losses | 721 | 2,217 | 744 | |||||||||
| Net Interest Income After Provision for Credit Losses | 42,964 | 40,634 | 39,453 | |||||||||
| Non-interest Income | ||||||||||||
| Interchange income | 3,127 | 3,294 | 3,151 | |||||||||
| Service charges on deposit accounts | 2,814 | 2,976 | 2,872 | |||||||||
| Net gains (losses) on assets | ||||||||||||
| Mortgage loans | 2,303 | 1,705 | 1,364 | |||||||||
| Securities available for sale | (330 | ) | (14 | ) | (269 | ) | ||||||
| Mortgage loan servicing, net | (636 | ) | 7,761 | 2,725 | ||||||||
| Other | 3,146 | 3,399 | 2,718 | |||||||||
| Total Non-interest Income | 10,424 | 19,121 | 12,561 | |||||||||
| Non-interest Expense | ||||||||||||
| Compensation and employee benefits | 20,383 | 22,886 | 20,770 | |||||||||
| Data processing | 3,729 | 3,688 | 3,255 | |||||||||
| Occupancy, net | 2,223 | 1,953 | 2,074 | |||||||||
| Interchange expense | 1,119 | 1,131 | 1,097 | |||||||||
| Furniture, fixtures and equipment | 885 | 928 | 954 | |||||||||
| Advertising | 861 | 1,198 | 491 | |||||||||
| Loan and collection | 786 | 606 | 512 | |||||||||
| FDIC deposit insurance | 711 | 729 | 782 | |||||||||
| Communications | 591 | 462 | 615 | |||||||||
| Legal and professional | 479 | 849 | 486 | |||||||||
| Costs (recoveries) related to unfunded lending commitments | 196 | 303 | (652 | ) | ||||||||
| Other | 2,299 | 2,254 | 1,809 | |||||||||
| Total Non-interest Expense | 34,262 | 36,987 | 32,193 | |||||||||
| Income Before Income Tax | 19,126 | 22,768 | 19,821 | |||||||||
| Income tax expense | 3,536 | 4,307 | 3,830 | |||||||||
| Net Income | $ | 15,590 | $ | 18,461 | $ | 15,991 | ||||||
| Net Income Per Common Share | ||||||||||||
| Basic | $ | 0.74 | $ | 0.88 | $ | 0.77 | ||||||
| Diluted | $ | 0.74 | $ | 0.87 | $ | 0.76 | ||||||
| INDEPENDENT BANK CORPORATION AND SUBSIDIARIES Selected Financial Data | |||||||||||||||||||
| March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | March 31, 2024 | |||||||||||||||
| (unaudited) | |||||||||||||||||||
| (Dollars in thousands except per share data) | |||||||||||||||||||
| Three Months Ended | |||||||||||||||||||
| Net interest income | $ | 43,685 | $ | 42,851 | $ | 41,854 | $ | 41,346 | $ | 40,197 | |||||||||
| Provision for credit losses | 721 | 2,217 | 1,488 | 19 | 744 | ||||||||||||||
| Non-interest income | 10,424 | 19,121 | 9,508 | 15,172 | 12,561 | ||||||||||||||
| Non-interest expense | 34,262 | 36,987 | 32,583 | 33,333 | 32,193 | ||||||||||||||
| Income before income tax | 19,126 | 22,768 | 17,291 | 23,166 | 19,821 | ||||||||||||||
| Income tax expense | 3,536 | 4,307 | 3,481 | 4,638 | 3,830 | ||||||||||||||
| Net income | $ | 15,590 | $ | 18,461 | $ | 13,810 | $ | 18,528 | $ | 15,991 | |||||||||
| Basic earnings per share | $ | 0.74 | $ | 0.88 | $ | 0.66 | $ | 0.89 | $ | 0.77 | |||||||||
| Diluted earnings per share | 0.74 | 0.87 | 0.65 | 0.88 | 0.76 | ||||||||||||||
| Cash dividend per share | 0.26 | 0.24 | 0.24 | 0.24 | 0.24 | ||||||||||||||
| Average shares outstanding | 20,943,094 | 20,893,820 | 20,896,019 | 20,901,741 | 20,877,067 | ||||||||||||||
| Average diluted shares outstanding | 21,150,550 | 21,122,096 | 21,115,273 | 21,105,387 | 21,079,607 | ||||||||||||||
| Performance Ratios | |||||||||||||||||||
| Return on average assets | 1.18 | % | 1.39 | % | 1.04 | % | 1.44 | % | 1.24 | % | |||||||||
| Return on average equity | 13.71 | 16.31 | 12.54 | 17.98 | 15.95 | ||||||||||||||
| Efficiency ratio (1) | 62.20 | 59.09 | 62.82 | 61.49 | 60.26 | ||||||||||||||
| As a Percent of Average Interest-Earning Assets (1) | |||||||||||||||||||
| Interest income | 5.28 | % | 5.37 | % | 5.48 | % | 5.45 | % | 5.34 | % | |||||||||
| Interest expense | 1.79 | 1.92 | 2.11 | 2.05 | 2.04 | ||||||||||||||
| Net interest income | 3.49 | 3.45 | 3.37 | 3.40 | 3.30 | ||||||||||||||
| Average Balances | |||||||||||||||||||
| Loans | $ | 4,060,941 | $ | 3,994,661 | $ | 3,909,954 | $ | 3,849,199 | $ | 3,810,526 | |||||||||
| Securities | 883,676 | 912,073 | 933,750 | 944,435 | 999,140 | ||||||||||||||
| Total earning assets | 5,078,596 | 5,007,566 | 4,985,842 | 4,893,367 | 4,910,669 | ||||||||||||||
| Total assets | 5,378,022 | 5,300,368 | 5,275,623 | 5,181,317 | 5,201,452 | ||||||||||||||
| Deposits | 4,715,331 | 4,655,091 | 4,616,119 | 4,531,917 | 4,561,645 | ||||||||||||||
| Interest bearing liabilities | 3,799,852 | 3,717,483 | 3,689,684 | 3,611,972 | 3,627,446 | ||||||||||||||
| Shareholders' equity | 461,291 | 450,214 | 438,077 | 414,549 | 403,225 | ||||||||||||||
(1) Presented on a fully tax equivalent basis assuming a marginal tax rate of 21%.
| INDEPENDENT BANK CORPORATION AND SUBSIDIARIES Selected Financial Data (continued) | |||||||||||||||||||
| March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | March 31, 2024 | |||||||||||||||
| (unaudited) | |||||||||||||||||||
| (Dollars in thousands except per share data) | |||||||||||||||||||
| End of Period | |||||||||||||||||||
| Capital | |||||||||||||||||||
| Tangible common equity ratio | 8.26 | % | 8.00 | % | 8.08 | % | 7.63 | % | 7.41 | % | |||||||||
| Tangible common equity ratio excluding accumulated other comprehensive loss | 9.31 | 9.10 | 8.99 | 8.76 | 8.57 | ||||||||||||||
| Average equity to average assets | 8.58 | 8.49 | 8.30 | 8.00 | 7.75 | ||||||||||||||
| Total capital to risk-weighted assets (2) | 14.51 | 14.22 | 14.25 | 14.21 | 13.85 | ||||||||||||||
| Tier 1 capital to risk-weighted assets (2) | 12.34 | 12.06 | 12.06 | 12.01 | 11.65 | ||||||||||||||
| Common equity tier 1 capital to risk-weighted assets (2) | 11.46 | 11.17 | 11.16 | 11.09 | 10.73 | ||||||||||||||
| Tier 1 capital to average assets (2) | 9.88 | 9.85 | 9.63 | 9.59 | 9.29 | ||||||||||||||
| Common shareholders' equity per share of common stock | $ | 22.28 | $ | 21.76 | $ | 21.65 | $ | 20.60 | $ | 19.88 | |||||||||
| Tangible common equity per share of common stock | 20.87 | 20.33 | 20.22 | 19.16 | 18.44 | ||||||||||||||
| Total shares outstanding | 20,970,115 | 20,895,714 | 20,893,800 | 20,899,358 | 20,903,677 | ||||||||||||||
| Selected Balances | |||||||||||||||||||
| Loans | $ | 4,072,691 | $ | 4,038,825 | $ | 3,942,287 | $ | 3,851,889 | $ | 3,839,965 | |||||||||
| Securities | 866,604 | 898,618 | 932,312 | 936,194 | 963,577 | ||||||||||||||
| Total earning assets | 5,031,975 | 5,024,083 | 4,964,784 | 4,979,555 | 4,949,496 | ||||||||||||||
| Total assets | 5,328,428 | 5,338,104 | 5,259,268 | 5,277,500 | 5,231,255 | ||||||||||||||
| Deposits | 4,633,931 | 4,654,088 | 4,626,875 | 4,614,328 | 4,582,414 | ||||||||||||||
| Interest bearing liabilities | 3,768,435 | 3,764,832 | 3,682,482 | 3,694,025 | 3,677,060 | ||||||||||||||
| Shareholders' equity | 467,277 | 454,686 | 452,369 | 430,459 | 415,570 | ||||||||||||||
(2) March 31, 2025 are Preliminary.
Reconciliation of Non-GAAP Financial Measures
Independent Bank Corporation
Independent Bank Corporation believes non-GAAP measures are meaningful because they reflect adjustments commonly made by management, investors, regulators and analysts to evaluate the adequacy of common equity and performance trends. Tangible common equity is used by the Company to measure the quality of capital.
Reconciliation of Non-GAAP Financial Measures
| Three Months Ended March 31, | |||||||
| 2025 | 2024 | ||||||
| (Dollars in thousands) | |||||||
| Net Interest Margin, Fully Taxable Equivalent ("FTE") | |||||||
| Net interest income | $ | 43,685 | $ | 40,197 | |||
| Add: taxable equivalent adjustment | 452 | 180 | |||||
| Net interest income - taxable equivalent | $ | 44,137 | $ | 40,377 | |||
| Net interest margin (GAAP) (1) | 3.46 | % | 3.28 | % | |||
| Net interest margin (FTE) (1) | 3.49 | % | 3.30 | % | |||
(1) Annualized.
Tangible Common Equity Ratio
| March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | March 31, 2024 | |||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||
| Common shareholders' equity | $ | 467,277 | $ | 454,686 | $ | 452,369 | $ | 430,459 | $ | 415,570 | |||||||||
| Less: | |||||||||||||||||||
| Goodwill | 28,300 | 28,300 | 28,300 | 28,300 | 28,300 | ||||||||||||||
| Other intangibles | 1,366 | 1,488 | 1,617 | 1,746 | 1,875 | ||||||||||||||
| Tangible common equity | 437,611 | 424,898 | 422,452 | 400,413 | 385,395 | ||||||||||||||
| Addition: | |||||||||||||||||||
| Accumulated other comprehensive loss for regulatory purposes | 61,285 | 64,146 | 52,454 | 65,030 | 65,831 | ||||||||||||||
| Tangible common equity excluding accumulated other comprehensive loss adjustments | $ | 498,896 | $ | 489,044 | $ | 474,906 | $ | 465,443 | $ | 451,226 | |||||||||
| Total assets | $ | 5,328,428 | $ | 5,338,104 | $ | 5,259,268 | $ | 5,277,500 | $ | 5,231,255 | |||||||||
| Less: | |||||||||||||||||||
| Goodwill | 28,300 | 28,300 | 28,300 | 28,300 | 28,300 | ||||||||||||||
| Other intangibles | 1,366 | 1,488 | 1,617 | 1,746 | 1,875 | ||||||||||||||
| Tangible assets | 5,298,762 | 5,308,316 | 5,229,351 | 5,247,454 | 5,201,080 | ||||||||||||||
| Addition: | |||||||||||||||||||
| Net unrealized losses on available for sale securities and derivatives, net of tax | 61,285 | 64,146 | 52,454 | 65,030 | 65,831 | ||||||||||||||
| Tangible assets excluding accumulated other comprehensive loss adjustments | $ | 5,360,047 | $ | 5,372,462 | $ | 5,281,805 | $ | 5,312,484 | $ | 5,266,911 | |||||||||
| Common equity ratio | 8.77 | % | 8.52 | % | 8.60 | % | 8.16 | % | 7.94 | % | |||||||||
| Tangible common equity ratio | 8.26 | % | 8.00 | % | 8.08 | % | 7.63 | % | 7.41 | % | |||||||||
| Tangible common equity ratio excluding accumulated other comprehensive loss | 9.31 | % | 9.10 | % | 8.99 | % | 8.76 | % | 8.57 | % | |||||||||
| Tangible Common Equity per Share of Common Stock: | |||||||||||||||||||
| Common shareholders' equity | $ | 467,277 | $ | 454,686 | $ | 452,369 | $ | 430,459 | $ | 415,570 | |||||||||
| Tangible common equity | $ | 437,611 | $ | 424,898 | $ | 422,452 | $ | 400,413 | $ | 385,395 | |||||||||
| Shares of common stock outstanding (in thousands) | 20,970 | 20,896 | 20,894 | 20,899 | 20,904 | ||||||||||||||
| Common shareholders' equity per share of common stock | $ | 22.28 | $ | 21.76 | $ | 21.65 | $ | 20.60 | $ | 19.88 | |||||||||
| Tangible common equity per share of common stock | $ | 20.87 | $ | 20.33 | $ | 20.22 | $ | 19.16 | $ | 18.44 | |||||||||
The tangible common equity ratio removes the effect of goodwill and other intangible assets from capital and total assets. Tangible common equity per share of common stock removes the effect of goodwill and other intangible assets from common shareholders' equity per share of common stock.
| Contact: | William B. Kessel, President and CEO, 616.447.3933 Gavin A. Mohr, Chief Financial Officer, 616.447.3929 |
