-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Qc0rCO2iK2BHlC17TS4IXTcgKu3YakRzCFwRST8kRuvIpnooLyAYmiQrtE73+IIr R7/2rLizbzX75ymJff+HAw== 0000950124-05-004156.txt : 20050707 0000950124-05-004156.hdr.sgml : 20050707 20050707095105 ACCESSION NUMBER: 0000950124-05-004156 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20050707 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050707 DATE AS OF CHANGE: 20050707 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MERCANTILE BANK CORP CENTRAL INDEX KEY: 0001042729 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 383360865 STATE OF INCORPORATION: MI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-26719 FILM NUMBER: 05942427 BUSINESS ADDRESS: STREET 1: 5650 BYRON CENTER AVENUE S. W. CITY: WYOMING STATE: MI ZIP: 49509 BUSINESS PHONE: 616 406-3777 MAIL ADDRESS: STREET 1: 5650 BYRON CENTER AVENUE S. W. CITY: WYOMING STATE: MI ZIP: 49509 8-K 1 k96550ae8vk.txt CURRENT REPORT, DATED JULY 7, 2005 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): JULY 7, 2005 -------------------- MERCANTILE BANK CORPORATION (Exact name of registrant as specified in its charter) MICHIGAN 000-26719 38-3360865 (State or other jurisdiction (Commission File (IRS Employer of incorporation) Number) Identification Number) 310 LEONARD STREET NW, GRAND RAPIDS, MICHIGAN 49504 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code 616-406-3000 Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION. Earnings Release. On July 7, 2005, Mercantile Bank Corporation issued a press release reporting earnings and other financial results for the quarter ended June 30, 2005. A copy of the press release is attached as Exhibit 99.1 and incorporated here by reference. The information in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933. ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS (c) Exhibits.
Exhibit Number Description - -------------- ----------- 99.1 Press release of Mercantile Bank Corporation reporting financial results and earnings for the quarter ended June 30, 2005.
2 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. MERCANTILE BANK CORPORATION By: /s/ Charles E. Christmas -------------------------------- Charles E. Christmas Senior Vice President, Chief Financial Officer and Treasurer Date: July 7, 2005 3 EXHIBIT INDEX
Exhibit Number Description - -------------- ----------- 99.1 Press release of Mercantile Bank Corporation reporting financial results and earnings for the quarter ended June 30, 2005.
4 EX-99.1 2 k96550aexv99w1.txt PRESS RELEASE EXHIBIT 99.1 [MERCANTILE(R) BANK CORPORATION LOGO] FOR FURTHER INFORMATION: AT MERCANTILE BANK CORPORATION: Gerald R. Johnson, Jr. Charles Christmas Chairman & CEO Chief Financial Officer 616-726-1200 616-726-1202 gjohnson@mercbank.com cchristmas@mercbank.com MERCANTILE BANK CORPORATION ANNOUNCES SECOND QUARTER NET INCOME OF $4.7 MILLION, UP 49.1% Grand Rapids, MICH., July 7, 2005 -- Mercantile Bank Corporation (Nasdaq: MBWM) reported net income for the quarter ended June 30, 2005 of $4.7 million, an increase of 49.1 percent from the $3.1 million reported for the quarter ended June 30, 2004. Diluted earnings per share were $0.64 compared with $0.43 reported for the prior-year second quarter, an increase of 48.8 percent. For the first six months of 2005, Mercantile reported net income of $9.1 million, an increase of 47.9 percent from the $6.1 million reported in the prior-year period. Diluted earnings per share were $1.23, an increase of 46.4 percent from the first six months of 2004. Gerald R. Johnson, Jr., Chairman and CEO, commented, "Mercantile Bank continues to expand its reach. The combination of exceptional service and commercial lending expertise that we provide has attracted and retained a loyal West Michigan client base. This past quarter, we announced our expansion into Lansing and Ann Arbor, Michigan, two dynamic markets where our initiatives will be led by experienced, local commercial lenders." Mr. Johnson continued, "We have demonstrated our ability to achieve strong growth in assets, revenue and bottom-line profits year over year -- as well as quarterly -- while investing in infrastructure and staff. Growth continues at a robust pace, with no evidence of deterioration in asset quality despite softness in the West Michigan economy. Effective management of our balance sheet has also enabled us to benefit consistently over the past year from the rising rate environment. We look forward to continued growth from expansion activities as well as from our West Michigan market." Total revenue, comprised of net interest income and non-interest income, was $14.8 million for the second quarter of 2005, an increase of 34.8 percent over the $11.0 million reported for the second quarter of 2004. Net interest income for the current quarter increased 36.1 percent over the prior-year second quarter to $13.6 million, reflecting a combination of 24.7 percent growth in average earning assets and a 28 basis point improvement in the net interest margin to 3.52 percent; margin improvement from the first quarter of 2005 was six basis points. Non-interest income was $1.2 million, a 21.7 percent increase over last year's second quarter; the quarter reflected growth in all fee businesses with the exception of mortgage banking, which experienced a modest decline. Non-interest expense for the second quarter of 2005 was $7.1 million, an increase of 32.3 percent over the prior-year period, principally in support of corporate growth. Salaries and benefits, up 25.5 percent, represented the largest dollar increase in non-interest expense; the $0.9 million increase was consistent with an increase of 54 full-time equivalent employees (up 29.5 percent) year-over-year. Occupancy, equipment, furniture and other non-interest expense rose 45.0 percent, also in support of corporate growth, and in particular, from the investment in the Holland full-service banking office and the recently-opened new headquarters building. Despite Mercantile's ongoing expansion and service quality initiatives, the efficiency ratio continues to improve; it was 48.19 percent for the second quarter of 2005 compared with 49.09 percent for the prior-year period. Mr. Johnson continued, "Strong asset quality has been a consistent contributor to Mercantile's outstanding performance, and the second quarter of 2005 continues to reflect the successful execution of our credit strategies." Net charge-offs for the second quarter of 2005 were $140,000, or 0.04 percent of average loans on an annualized basis, compared with $255,000, or 0.09 percent for the prior-year second quarter. Non-performing assets were $3.7 million, or 0.22 percent of total assets at June 30, 2005, compared with $5.2 million, or 0.31 percent at March 31, 2005, and $3.7 million, or 0.27 percent twelve months ago. Loan and lease loss reserves were $18.9 million, or 1.32 percent of total loans and leases, at June 30, 2005. Total assets were $1.71 billion at June 30, 2005, an increase of $330.5 million, or 24.0 percent, from last year's second quarter-end. Loan growth, virtually all of which was commercial, was $239.1 million or 20.2 percent during the same 12-month period; the increase was primarily funded by a $275.8 million, or 26.4 percent, increase in deposits. Shareholders' equity at June 30, 2005 was $149.2 million, a twelve-month increase of $14.9 million, or 11.1 percent. Total shares outstanding at quarter-end were 7,221,323. Mercantile's total risk-based capital ratio at quarter-end was 12.58 percent. Mr. Johnson concluded, "Our move into our new headquarters building this past quarter along with the opening of offices outside western Michigan signals a new era for Mercantile. We are well-positioned to carry our successful strategy to other attractive markets." About Mercantile Bank Corporation Mercantile Bank Corporation is the bank holding company for Mercantile Bank of West Michigan. The Bank's primary service area is the Kent and Ottawa County area of West Michigan, which includes the City of Grand Rapids, the second-largest city in the State of Michigan. The Bank provides a wide variety of commercial banking services primarily to businesses, individuals, and governmental units through its five full-service offices in greater Grand Rapids and its Holland, Michigan office located thirty miles southwest of Grand Rapids. Mercantile Bank recently announced plans to open full-service branches in Lansing and Ann Arbor, Michigan. Mercantile Bank Corporation's common stock is listed on the Nasdaq National Market under the symbol "MBWM." Forward-Looking Statements This news release contains comments or information that constitute forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995) that are based on current expectations that involve a number of risks and uncertainties. Actual results may differ materially from the results expressed in forward-looking statements. Factors that might cause such a difference include changes in interest rates and interest rate relationships; demand for products and services; the degree of competition by traditional and non-traditional competitors; changes in banking regulation; changes in tax laws; changes in prices, levies, and assessments; the impact of technological advances; governmental and regulatory policy changes; the outcomes of contingencies; trends in customer behavior as well as their ability to repay loans; changes in the national and local economy; and other factors, including risk factors, referred to from time to time in filings made by Mercantile with the Securities and Exchange Commission. Mercantile undertakes no obligation to update or clarify forward-looking statements, whether as a result of new information, future events or otherwise. Mercantile Bank Corporation Second Quarter 2005 Results MERCANTILE BANK CORPORATION CONSOLIDATED BALANCE SHEETS
JUNE 30, DECEMBER 31, JUNE 30, 2005 2004 2004 --------------- --------------- --------------- (Unaudited) (Audited) (Unaudited) ASSETS Cash and due from banks $ 35,466,000 $ 20,662,000 $ 35,005,000 Short-term investments 597,000 149,000 967,000 Federal funds sold 21,400,000 0 0 --------------- --------------- --------------- Total cash and cash equivalents 57,463,000 20,811,000 35,972,000 Securities available for sale 107,896,000 93,826,000 69,751,000 Securities held to maturity 58,851,000 52,341,000 48,466,000 Federal Home Loan Bank stock 7,425,000 6,798,000 6,644,000 Total loans and leases 1,424,463,000 1,317,124,000 1,185,363,000 Allowance for loan and lease losses (18,856,000) (17,819,000) (16,312,000) --------------- --------------- --------------- Total Loans and leases, net 1,405,607,000 1,299,305,000 1,169,051,000 Premises and equipment, net 29,118,000 24,572,000 18,468,000 Bank owned life insurance policies 24,669,000 23,750,000 16,796,000 Accrued interest receivable 6,550,000 5,644,000 4,257,000 Other assets 11,578,000 9,072,000 9,221,000 --------------- --------------- --------------- Total assets $ 1,709,157,000 $ 1,536,119,000 $ 1,378,626,000 =============== =============== =============== LIABILITIES AND STOCKHOLDERS' EQUITY Deposits: Noninterest-bearing $ 136,830,000 $ 101,742,000 $ 114,441,000 Interest-bearing 1,185,014,000 1,057,439,000 931,628,000 --------------- --------------- --------------- Total deposits 1,321,844,000 1,159,181,000 1,046,069,000 Securities sold under agreement to repurchase 56,034,000 56,317,000 46,960,000 Federal funds purchased 0 15,000,000 7,000,000 Federal Home Loan Bank advances 135,000,000 120,000,000 120,000,000 Subordinated debentures 32,990,000 32,990,000 16,495,000 Other borrowed money 2,069,000 1,609,000 1,414,000 Accrued expenses and other liabilities 12,016,000 9,405,000 6,416,000 --------------- --------------- --------------- Total liabilities 1,559,953,000 1,394,502,000 1,244,354,000 SHAREHOLDERS' EQUITY Common stock 131,186,000 131,010,000 130,902,000 Retained earnings 18,012,000 10,475,000 4,166,000 Accumulated other comprehensive income (loss) 6,000 132,000 (796,000) --------------- --------------- --------------- Total shareholders' equity 149,204,000 141,617,000 134,272,000 Total liabilities and shareholders' equity $ 1,709,157,000 $ 1,536,119,000 $ 1,378,626,000 =============== =============== ===============
Mercantile Bank Corporation Second Quarter 2005 Results MERCANTILE BANK CORPORATION CONSOLIDATED REPORTS OF INCOME
THREE MONTHS ENDED THREE MONTHS ENDED SIX MONTHS ENDED SIX MONTHS ENDED June 30, 2005 June 30, 2004 June 30, 2005 June 30, 2004 ------------------ ------------------ ---------------- ---------------- (Unaudited) (Unaudited) (Unaudited) (Unaudited) INTEREST INCOME Loans and leases, including fees $ 22,250,000 $ 14,722,000 $ 42,022,000 $ 28,630,000 Investment securities 2,036,000 1,400,000 3,923,000 2,826,000 Federal funds sold 56,000 8,000 100,000 27,000 Short-term investments 4,000 0 6,000 1,000 ------------ ------------ ------------ ------------ Total interest income 24,346,000 16,130,000 46,051,000 31,484,000 INTEREST EXPENSE Deposits 8,892,000 4,929,000 16,332,000 9,679,000 Short-term borrowings 375,000 186,000 713,000 356,000 Federal Home Loan Bank advances 1,006,000 597,000 1,863,000 1,126,000 Long-term borrowings 465,000 418,000 880,000 834,000 ------------ ------------ ------------ ------------ Total interest expense 10,738,000 6,130,000 19,788,000 11,995,000 ------------ ------------ ------------ ------------ Net interest income 13,608,000 10,000,000 26,263,000 19,489,000 Provision for loan and lease losses 900,000 1,230,000 1,625,000 2,474,000 ------------ ------------ ------------ ------------ Net interest income after provision for loan and lease losses 12,708,000 8,770,000 24,638,000 17,015,000 NON INTEREST INCOME Service charges on accounts 341,000 312,000 679,000 611,000 Net gain on sales of securities 0 0 0 78,000 Net gain on sales of loans 28,000 40,000 28,000 40,000 Other income 849,000 649,000 1,721,000 1,311,000 ------------ ------------ ------------ ------------ Total non interest income 1,218,000 1,001,000 2,428,000 2,040,000 NON INTEREST EXPENSE Salaries and benefits 4,405,000 3,510,000 8,564,000 6,793,000 Occupancy 566,000 383,000 1,084,000 769,000 Furniture and equipment 362,000 267,000 650,000 540,000 Other expense 1,812,000 1,240,000 3,697,000 2,453,000 ------------ ------------ ------------ ------------ Total non interest expense 7,145,000 5,400,000 13,995,000 10,555,000 ------------ ------------ ------------ ------------ Income before federal income tax expense 6,781,000 4,371,000 13,071,000 8,500,000 Federal income tax expense 2,091,000 1,225,000 4,019,000 2,381,000 ------------ ------------ ------------ ------------ Net income $ 4,690,000 $ 3,146,000 $ 9,052,000 $ 6,119,000 ============ ============ ============ ============ Basic earnings per share $ 0.65 $ 0.44 $ 1.26 $ 0.85 Diluted earnings per share $ 0.64 $ 0.43 $ 1.23 $ 0.84 Average shares outstanding * 7,218,512 7,172,633 7,212,451 7,165,744 Average diluted shares outstanding * 7,353,163 7,322,474 7,368,687 7,310,298
Mercantile Bank Corporation Second Quarter 2005 Results MERCANTILE BANK CORPORATION CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
QUARTERLY YEAR-TO-DATE ------------------------------------------------------ --------------------- 2005 2005 2004 2004 2004 (dollars in thousands except per share data) 2ND QTR 1ST QTR 4TH QTR 3RD QTR 2ND QTR 2005 2004 ---------- --------- --------- --------- --------- --------- --------- EARNINGS Net interest income $ 13,608 12,655 12,082 10,856 10,000 26,263 19,489 Provision for loan and lease losses $ 900 725 1,000 1,200 1,230 1,625 2,474 NonInterest income $ 1,218 1,210 1,106 1,156 1,001 2,428 2,040 NonInterest expense $ 7,145 6,850 6,228 6,415 5,400 13,995 10,555 Net income $ 4,690 4,362 4,488 3,114 3,146 9,052 6,119 Basic earnings per share $ 0.65 0.61 0.62 0.43 0.44 1.26 0.85 Diluted earnings per share $ 0.64 0.59 0.61 0.43 0.43 1.23 0.84 Average shares outstanding 7,218,512 7,206,322 7,189,575 7,176,032 7,172,633 7,212,451 7,165,744 Average diluted shares outstanding 7,353,163 7,345,543 7,350,178 7,318,345 7,322,474 7,368,687 7,310,298 PERFORMANCE RATIOS Return on average assets 1.13% 1.11% 1.18% 0.86% 0.95% 1.12% 0.95% Return on average common equity 12.80% 12.36% 12.74% 9.06% 9.50% 12.58% 9.30% Net interest margin (fully tax-equivalent) 3.52% 3.46% 3.43% 3.23% 3.24% 3.49% 3.25% Efficiency ratio 48.19% 49.41% 47.22% 53.40% 49.09% 48.78% 49.03% Full-time equivalent employees 237 212 194 190 183 237 183 CAPITAL Average equity to average assets 8.81% 8.99% 9.29% 9.54% 10.01% 8.90% 10.25% Tier 1 leverage capital ratio 10.86% 11.13% 11.53% 10.75% 11.35% 10.86% 11.35% Tier 1 risk-based capital ratio 11.40% 11.53% 11.82% 10.99% 11.50% 11.40% 11.50% Total risk-based capital ratio 12.58% 12.71% 13.03% 12.21% 12.74% 12.58% 12.74% Book value per share $ 20.66 20.04 19.69 19.22 18.71 20.66 18.71 Cash dividend per share $ 0.11 0.10 0.09 0.09 0.09 0.21 0.18 ASSET QUALITY Gross loan charge-offs $ 211 493 262 581 263 704 562 Net loan charge-offs $ 140 447 226 467 255 587 541 Net loan charge-offs to average loans 0.04% 0.13% 0.07% 0.15% 0.09% 0.09% 0.10% Allowance for loan and lease losses $ 18,856 18,097 17,819 17,045 16,312 18,856 16,312 Allowance for losses to total loans 1.32% 1.32% 1.35% 1.36% 1.38% 1.32% 1.38% Nonperforming loans $ 2,535 4,016 2,842 2,985 3,731 2,535 3,731 Other real estate and repossessed assets $ 1,177 1,177 0 0 0 1,177 0 Nonperforming assets to total assets 0.22% 0.31% 0.19% 0.20% 0.27% 0.22% 0.27% END OF PERIOD BALANCES Loans and leases $1,424,463 1,374,577 1,317,124 1,253,713 1,185,363 1,424,463 1,185,363 Total earning assets (before allowance) $1,620,632 1,575,697 1,470,238 1,404,559 1,311,191 1,620,632 1,311,191 Total assets $1,709,157 1,664,876 1,536,119 1,474,949 1,378,626 1,709,157 1,378,626 Deposits $1,321,844 1,290,017 1,159,181 1,144,857 1,046,069 1,321,844 1,046,069 Shareholders' equity $ 149,204 144,501 141,617 137,935 134,272 149,204 134,272 AVERAGE BALANCES Loans and leases $1,402,469 1,345,336 1,276,913 1,219,325 1,144,758 1,374,061 1,106,234 Total earning assets (before allowance) $1,582,453 1,511,891 1,428,121 1,361,985 1,269,300 1,547,367 1,233,118 Total assets $1,669,202 1,591,764 1,504,526 1,429,059 1,330,507 1,630,697 1,290,620 Deposits $1,281,652 1,214,890 1,150,606 1,094,166 1,004,651 1,248,455 975,606 Shareholders' equity $ 146,997 143,169 139,744 136,290 133,211 145,093 132,284
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