Exhibit 99.1

Mercantile Bank Corporation Announces Strong Fourth Quarter and

Full Year 2020 Results

Substantial increase in mortgage banking income and sustained strength in asset quality metrics highlight 2020

GRAND RAPIDS, Mich., January 19, 2021 – Mercantile Bank Corporation (NASDAQ: MBWM) ("Mercantile") reported net income of $14.1 million, or $0.87 per diluted share, for the fourth quarter of 2020, compared with net income of $13.3 million, or $0.81 per diluted share, for the respective prior-year period. For the full year 2020, Mercantile reported net income of $44.1 million, or $2.71 per diluted share, compared with net income of $49.5 million, or $3.01 per diluted share, for the full year 2019.

“We are very pleased to report another year of strong financial performance, especially when considering the unprecedented operating environment posed by the ongoing COVID-19 pandemic,” said Robert B. Kaminski, Jr., President and Chief Executive Officer of Mercantile. “The strategic initiatives we implemented to address the challenges stemming from the pandemic have proven to be effective, and we continue to monitor economic conditions to ensure potential future risks are appropriately managed. The remarkable efforts of the entire Mercantile team enabled us to continue to effectively assist and support our clients with their banking needs during this period of uncertainty.”

Full year highlights include:

● Solid capital position

● Continued strong asset quality metrics

● Paycheck Protection Program loan fundings of approximately $555 million

● Sustained strength in commercial loan and residential mortgage loan pipelines

● Significant increase in mortgage banking income and growth in certain other key fee income categories

● Robust local deposit growth

● Controlled overhead costs

● Opened new mortgage lending centers in Midland, Michigan and Cincinnati, Ohio

● Announced first quarter 2021 regular cash dividend of $0.29 per common share, an increase of 3.6 percent from the regular cash dividend paid during the fourth quarter of 2020

Write-downs of former branch facilities decreased net income during the fourth quarter of 2020 by approximately $1.1 million, or $0.06 per diluted share, and net gains and losses on sales and write-downs of former branch facilities decreased net income during the fourth quarter of 2019 by approximately $0.3 million, or $0.02 per diluted share. Excluding the impacts of these transactions, diluted earnings per share increased $0.10, or 12.0 percent, during the fourth quarter of 2020 compared to the respective 2019 period.

A combination of a gain on sale and write-downs of former branch facilities decreased net income during 2020 by approximately $1.1 million, or $0.07 per diluted share. Bank owned life insurance claims and the net impact of gains and losses on sales and write-downs of former branch facilities increased net income during 2019 by approximately $2.7 million, or $0.16 per diluted share. Excluding the impacts of these transactions, diluted earnings per share decreased $0.07, or 2.5 percent, during 2020 compared to 2019.

Operating Results

Total revenue, which consists of net interest income and noninterest income, was $46.2 million during the fourth quarter of 2020, up $7.7 million, or 20.0 percent, from the prior-year fourth quarter. Net interest income during the fourth quarter of 2020 was $31.8 million, up $0.7 million, or 2.2 percent, from the fourth quarter of 2019, reflecting the positive impact of earning asset growth, which more than offset a decreased net interest margin. Noninterest income totaled $14.3 million during the fourth quarter of 2020, up $7.0 million from the respective 2019 period, mainly due to increased mortgage banking income. Total revenue was $167 million during the full year 2020, up $15.9 million, or 10.5 percent, from 2019. Net interest income was $122 million in 2020, down $2.3 million, or 1.8 percent, from the prior year, depicting a reduced net interest margin, which more than offset the positive impact of earning asset growth. Noninterest income totaled $45.2 million during 2020, up $18.2 million from 2019, mainly due to a higher level of mortgage banking income.

The net interest margin was 3.00 percent in the fourth quarter of 2020, compared to 3.63 percent in the fourth quarter of 2019. The yield on average earning assets was 3.55 percent during the fourth quarter of 2020, down from 4.61 percent during the prior-year fourth quarter, mainly due to a decreased yield on commercial loans, which equaled 4.41 percent in the current-year fourth quarter compared to 5.12 percent in the respective 2019 period. The decreased yield on commercial loans primarily reflected reduced interest rates on variable-rate commercial loans resulting from the Federal Open Market Committee significantly lowering the targeted federal funds rate by a total of 175 basis points during the fourth quarter of 2019 and first three months of 2020. A significant volume of excess on-balance sheet liquidity consisting of low-yielding deposits with the Federal Reserve Bank of Chicago and a correspondent bank negatively impacted the yield on average earning assets during the fourth quarter of 2020. The excess funds are mainly a product of federal government stimulus programs as well as lower business and consumer investing and spending. Lower yields on interest-earning deposits and securities, reflecting the decreasing interest rate environment, also contributed to the reduced yield on average earning assets.

The cost of funds declined from 0.98 percent during the fourth quarter of 2019 to 0.55 percent during the current-year fourth quarter, primarily due to lower rates paid on local deposit accounts and borrowings, reflecting the declining interest rate environment. A change in funding mix, consisting of an increase in lower-costing non-time deposits as a percentage of total funding sources, also contributed to the decrease in the cost of funds.

The net interest margin was 3.15 percent in 2020, compared to 3.75 percent in 2019. The yield on average earning assets was 3.82 percent during 2020, down from 4.77 percent during 2019, primarily due to a decreased yield on commercial loans, which equaled 4.35 percent in 2020 compared to 5.21 percent in 2019. The decreased yield on commercial loans mainly reflected reduced interest rates on variable-rate commercial loans resulting from the Federal Open Market Committee significantly lowering the targeted federal funds rate by a total of 225 basis points during the last six months of 2019 and the first three months of 2020. A substantial volume of excess on-balance sheet liquidity consisting of low-yielding deposits with the Federal Reserve Bank of Chicago and a correspondent bank negatively impacted the yield on average earning assets during 2020. The excess funds are primarily a product of federal government stimulus programs as well as lower business and consumer investing and spending. A lower yield on interest-earning deposits, reflecting the decreasing interest rate environment, also contributed to the reduced yield on average earning assets. Accelerated discount accretion on called U.S. Government agency bonds totaling $3.0 million was recorded as interest income during 2020. The accelerated discount accretion positively impacted the net interest margin during 2020 by eight basis points.

The cost of funds equaled 0.67 percent during 2020, down from 1.02 percent during 2019, mainly due to reduced rates paid on local deposit accounts and borrowings, reflecting the declining interest rate environment. A change in funding mix, consisting of an increase in lower-costing non-time deposits as a percentage of total funding sources, also contributed to the decrease in the cost of funds.

Mercantile recorded provision expense of $2.5 million during the fourth quarter of 2020, compared to negative $0.7 million during the fourth quarter of 2019.  During 2020 and 2019, Mercantile recorded provision expense of $14.1 million and $1.8 million, respectively.  Approximately 80 percent of the provision expense recorded during 2020 is reflective of increased allocations associated with qualitative factors, namely economic conditions, loan review and value of underlying collateral dependent commercial loans, as well as the creation of a COVID-19 pandemic environmental factor.  The COVID-19 pandemic environmental factor, developed during the second quarter, is designed to address the unique challenges and economic uncertainty resulting from the pandemic and its potential impact on the collectability of the loan portfolio.  The provision expense recorded during the fourth quarter of 2020 was fully reflective of increased allocations associated with qualitative factors.  The provision expense recorded during 2020 also reflected the downgrading of certain non-impaired commercial loan relationships, most of which occurred during the third quarter.  The negative provision expense during the prior-year fourth quarter mainly reflected certain commercial loan paydowns and net loan recoveries being recorded during the period.  The provision expense recorded during 2019 primarily reflected ongoing net loan growth.

Noninterest income during the fourth quarter of 2020 was $14.3 million, compared to $7.3 million during the prior-year fourth quarter. Noninterest income during the fourth quarter of 2019 included a $0.3 million gain on the sale of a former branch facility. Excluding the aforementioned transaction, noninterest income increased $7.3 million, or approximately 103 percent, during the fourth quarter of 2020 compared to the respective 2019 period.  Noninterest income during 2020 was $45.2 million, compared to $27.0 million during 2019.  Noninterest income during 2019 included bank owned life insurance claims totaling $2.6 million and gains on the sales of former branch facilities totaling $0.8 million. Excluding these transactions, noninterest income increased $21.7 million, or 92.1 percent, during 2020 compared to 2019.  The improved level of noninterest income in both 2020 periods primarily resulted from increased mortgage banking income stemming from a sizeable upturn in refinance activity spurred by a decrease in residential mortgage loan interest rates, an increase in purchase activity, and the continuing success of strategic initiatives that were implemented to gain market share. Fee income generated from an interest rate swap program that was implemented during the fourth quarter of 2020 and growth in credit and debit card income also contributed to the improved noninterest income during both 2020 periods. The interest rate swap program provides certain commercial borrowers with a longer-term fixed-rate option and assists Mercantile in managing associated longer-term interest rate risk. In addition, increased payroll processing fees contributed to the higher level of noninterest income during the full year 2020 period.

Noninterest expense totaled $25.9 million during the fourth quarter of 2020, compared to $23.3 million during the fourth quarter of 2019. Noninterest expense totaled $98.5 million during 2020, compared to $89.3 million during 2019. Overhead costs during the fourth quarter of 2020 and full year 2020 included write-downs of former branch facilities totaling $1.4 million, while overhead costs during the prior-year fourth quarter and full year 2019 included a loss on the sale of a former branch facility of $0.5 million and a write-down of a former branch facility of $0.1 million. Excluding these transactions, noninterest expense increased $1.8 million, or 8.1 percent, during the fourth quarter of 2020 compared to the respective 2019 period, and $8.5 million, or 9.6 percent, during 2020 compared to 2019. The higher level of expense in both 2020 periods primarily resulted from increased compensation costs, mainly reflecting higher residential mortgage lender commissions and related incentives, annual employee merit pay increases, and an increased bonus accrual. The higher level of commissions and associated incentives primarily depicted the significant increase in residential mortgage loan originations during the fourth quarter of 2020 and full year 2020, which were up nearly 98 percent and 135 percent compared to the respective 2019 periods. Occupancy and equipment and furniture costs were up $1.7 million on a combined basis during 2020 compared to 2019, mainly reflecting increased depreciation expense associated with an expansion of Mercantile’s main office that was completed during the latter part of 2019. Federal Deposit Insurance Corporation insurance premiums increased $0.4 million in the fourth quarter of 2020 compared to the fourth quarter of 2019, and $0.9 million in 2020 compared to 2019, mainly as a result of deposit insurance assessment credits being applied against regular assessments during the last three quarters of 2019.

Mr. Kaminski commented, “The record-breaking level of mortgage banking income during 2020 reflects strong residential mortgage loan production and the ongoing success of our strategic initiatives that were designed to boost market share and increase revenue. We remain focused on positioning ourselves to produce solid mortgage banking income in future periods, as evidenced by the opening of mortgage lending centers in Midland, Michigan and Cincinnati, Ohio during 2020. We are also continually exploring options to enhance other noninterest income revenue streams, and are pleased with the growth in certain key fee income categories during 2020. We are committed to meeting growth objectives in a cost-conscious, efficient manner and continue to monitor our branch network and associated customer behaviors and preferences, which may have been altered as a result of the COVID-19 pandemic. As part of a branch network efficiency plan, we closed three branch facilities during the fourth quarter of 2020, which is expected to generate annual pre-tax savings of approximately $0.7 million.”

Balance Sheet

As of December 31, 2020, total assets were $4.44 billion, up $804 million, or 22.1 percent, from December 31, 2019. Total loans increased $360 million during 2020, primarily reflecting Paycheck Protection Program loan originations of $555 million during the second and third quarters. Paycheck Protection Program loans totaled approximately $365 million as of December 31, 2020, reflecting forgiveness payments received from the Small Business Administration during the fourth quarter. Commercial lines of credit remained relatively steady during the last six months of 2020 after having declined $109 million during the second quarter of 2020 largely due to the impacts of the COVID-19 pandemic environment and federal government stimulus programs. As of December 31, 2020, unfunded commitments on commercial construction and development loans totaled approximately $99 million, which are expected to be largely funded over the next 12 to 18 months. Interest-earning deposits increased $383 million during 2020, mainly resulting from growth in local deposits.

Ray Reitsma, President of Mercantile Bank of Michigan, noted, “Although economic conditions deteriorated as a result of the COVID-19 pandemic, our asset quality metrics remained strong throughout 2020. The sustained strength in our asset quality metrics reflects our unwavering commitment to sound underwriting, along with the relationships we have forged with solid companies that have strong management teams that are working diligently to enable the entities to successfully navigate through the challenges posed by the pandemic. Our past due loan and nonperforming asset levels remain low, and virtually all commercial and retail loan customers that were granted loan payment deferrals are now making full contractual loan payments.”

Mr. Reitsma added, “We were very successful in helping customers obtain funds under the Paycheck Protection Program, as depicted by the over 2,000 loans, totaling approximately $555 million, closed during 2020. The efforts of our team were recognized in the marketplace, providing us with many new loan and deposit relationship opportunities. Over the past few months, we have been focused on assisting loan recipients in the gathering and submitting of the required information to allow for the rendering of forgiveness determinations by the Small Business Administration. Although our team devoted a significant amount of time assisting customers in meeting pandemic-related challenges, we remained focused on identifying and attracting new client relationships and meeting the traditional needs of our existing customers. We are pleased with the ongoing strength of our commercial loan and residential mortgage loan pipelines.”

Excluding the impact of Paycheck Protection Program loan originations, commercial and industrial loans and owner-occupied commercial real estate loans together represented approximately 55 percent of total commercial loans as of December 31, 2020, a level that has remained relatively consistent and in line with internal expectations.

Total deposits at December 31, 2020, were $3.41 billion, up $721 million, or 26.8 percent, from December 31, 2019. Local deposits were up $808 million during 2020, while brokered deposits were down $86.5 million. The growth in local deposits mainly reflected federal government stimulus payments and reduced business and consumer investing and spending, along with Paycheck Protection Program loan proceeds being deposited into customers’ accounts at the time the loans were originated and remaining on deposit as of December 31, 2020. Wholesale funds were $441 million, or approximately 11 percent of total funds, as of December 31, 2020, compared to $487 million, or approximately 15 percent of total funds, as of December 31, 2019.

Asset Quality

Nonperforming assets at December 31, 2020, were $4.1 million, or 0.1 percent of total assets, compared to $2.7 million, or 0.1 percent of total assets, at December 31, 2019. During the fourth quarter of 2020, loan charge-offs totaled $0.3 million while recoveries of prior period loan charge-offs equaled $0.2 million, providing for net loan charge-offs of $0.1 million, or 0.01 percent of average total loans. During 2020, recoveries of prior period loan charge-offs totaling $0.9 million slightly exceeded loan charge-offs, providing for a nominal level of net loan recoveries.

Capital Position

Shareholders’ equity totaled $442 million as of December 31, 2020, an increase of $25.0 million from year-end 2019. The Bank’s capital position remains above “well-capitalized” with a total risk-based capital ratio of 13.5 percent as of December 31, 2020, compared to 13.0 percent at December 31, 2019. At December 31, 2020, the Bank had approximately $118 million in excess of the 10.0 percent minimum regulatory threshold required to be considered a “well-capitalized” institution. Mercantile reported 16,330,476 total shares outstanding at December 31, 2020.

As part of a $20 million common stock repurchase program announced in May 2019, Mercantile repurchased approximately 222,000 shares for $6.3 million, or a weighted average all-in cost per share of $28.25, during the first quarter of 2020. After electing to temporarily cease stock repurchases in March 2020 to preserve capital for lending and other purposes while management assessed the potential impacts of the COVID-19 pandemic, Mercantile reinstated the buyback program during the fourth quarter of 2020; fourth quarter repurchases totaled about 14,000 shares for $0.3 million, or a weighted average all-in cost per share of $22.05.

Mr. Kaminski concluded, “We are focused on positioning our company to remain a consistent high performer that provides steady and profitable growth and an attractive return to our investors. Our strong operating performance during 2020 enabled us to continue the cash dividend program and provide our shareholders with a cash return on their investments in spite of the challenges presented by the COVID-19 pandemic and associated weakened economic conditions. We were pleased to announce earlier today that our Board of Directors declared an increased first quarter 2021 regular cash dividend. We are passionate about our Environmental, Social, and Governance initiatives and the opportunities that exist in that space going forward. During 2020, we established new Diversity, Equity, and Inclusion initiatives in light of the racial justice discussions taking place in our country and communities, including ongoing conversations among our staff members, and we look forward to continuing our social awareness efforts in future periods. We are excited about Mercantile’s future and believe we are positioned to produce solid operating results in 2021.”

Investor Presentation

Mercantile has prepared presentation materials (the “Conference Call & Webcast Presentation”) that management intends to use during its previously announced fourth quarter 2020 conference call on Tuesday, January 19, 2021, at 10:00 a.m. Eastern Time, and from time to time thereafter in presentations about the Company’s operations and performance. The Investor Presentation also contains more detailed information relating to Mercantile’s COVID-19 pandemic response plan. These materials have been furnished to the U.S. Securities and Exchange Commission concurrently with this press release, and are also available on Mercantile’s website at www.mercbank.com.

About Mercantile Bank Corporation

Based in Grand Rapids, Michigan, Mercantile Bank Corporation is the bank holding company for Mercantile Bank of Michigan.  Mercantile provides banking services to businesses, individuals and governmental units, and differentiates itself on the basis of service quality and the expertise of its banking staff. Mercantile has assets of approximately $4.4 billion and operates 44 banking offices. Mercantile Bank Corporation’s common stock is listed on the NASDAQ Global Select Market under the symbol “MBWM.”

Forward-Looking Statements

This news release contains comments or information that may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any such comments 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 nontraditional competitors; changes in banking regulation or actions by bank regulators; our participation in the Paycheck Protection Program administered by the Small Business Administration; changes in tax laws; changes in prices, levies, and assessments; the impact of technological advances; potential cyber-attacks, information security breaches and other criminal activities; litigation liabilities; governmental and regulatory policy changes; the outcomes of contingencies; trends in customer behavior as well as their ability to repay loans; changes in local real estate values; changes in the national and local economies, including the significant disruption to financial market and other economic activity caused by the outbreak of COVID-19; and other factors, including risk factors, disclosed 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.

FOR FURTHER INFORMATION:

Robert B. Kaminski, Jr.	Charles Christmas
President and CEO	Executive Vice President and CFO
616-726-1502	616-726-1202
rkaminski@mercbank.com	cchristmas@mercbank.com

Mercantile Bank Corporation

Fourth Quarter 2020 Results

MERCANTILE BANK CORPORATION

CONSOLIDATED BALANCE SHEETS

(Unaudited)

	DECEMBER 31,			DECEMBER 31,			DECEMBER 31,
	2020			2019			2018
ASSETS
Cash and due from banks	$	62,832,000		$	53,262,000		$	64,872,000
Interest-earning deposits		563,174,000			180,469,000			10,482,000
Total cash and cash equivalents		626,006,000			233,731,000			75,354,000
Securities available for sale		387,347,000			334,655,000			337,366,000
Federal Home Loan Bank stock		18,002,000			18,002,000			16,022,000
Loans		3,216,358,000			2,856,667,000			2,753,085,000
Allowance for loan losses		(37,967,000	)		(23,889,000	)		(22,380,000	)
Loans, net		3,178,391,000			2,832,778,000			2,730,705,000
Premises and equipment, net		58,959,000			57,327,000			48,321,000
Bank owned life insurance		72,131,000			70,297,000			69,647,000
Goodwill		49,473,000			49,473,000			49,473,000
Core deposit intangible, net		2,436,000			3,840,000			5,561,000
Other assets		44,599,000			32,812,000			31,458,000
Total assets	$	4,437,344,000		$	3,632,915,000		$	3,363,907,000
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Noninterest-bearing	$	1,433,403,000		$	924,916,000		$	889,784,000
Interest-bearing		1,978,150,000			1,765,468,000			1,573,924,000
Total deposits		3,411,553,000			2,690,384,000			2,463,708,000
Securities sold under agreements to repurchase		118,365,000			102,675,000			103,519,000
Federal Home Loan Bank advances		394,000,000			354,000,000			350,000,000
Subordinated debentures		47,563,000			46,881,000			46,199,000
Accrued interest and other liabilities		24,309,000			22,414,000			25,232,000
Total liabilities		3,995,790,000			3,216,354,000			2,988,658,000
SHAREHOLDERS' EQUITY
Common stock		302,029,000			305,035,000			308,005,000
Retained earnings		134,039,000			107,831,000			75,483,000
Accumulated other comprehensive income/(loss)		5,486,000			3,695,000			(8,239,000	)
Total shareholders' equity		441,554,000			416,561,000			375,249,000
Total liabilities and shareholders' equity	$	4,437,344,000		$	3,632,915,000		$	3,363,907,000

Mercantile Bank Corporation

Fourth Quarter 2020 Results

MERCANTILE BANK CORPORATION

CONSOLIDATED REPORTS OF INCOME

(Unaudited)

	THREE MONTHS ENDED		THREE MONTHS ENDED			TWELVE MONTHS ENDED		TWELVE MONTHS ENDED
	December 31, 2020		December 31, 2019			December 31, 2020		December 31, 2019
INTEREST INCOME
Loans, including fees	$	35,971,000	$	36,257,000		$	137,399,000	$	145,816,000
Investment securities		1,484,000		2,563,000			10,038,000		10,150,000
Other interest-earning assets		165,000		744,000			876,000		2,371,000
Total interest income		37,620,000		39,564,000			148,313,000		158,337,000
INTEREST EXPENSE
Deposits		3,176,000		5,358,000			14,984,000		21,264,000
Short-term borrowings		41,000		51,000			173,000		295,000
Federal Home Loan Bank advances		2,072,000		2,226,000			8,571,000		8,977,000
Other borrowed money		482,000		761,000			2,339,000		3,267,000
Total interest expense		5,771,000		8,396,000			26,067,000		33,803,000
Net interest income		31,849,000		31,168,000			122,246,000		124,534,000
Provision for loan losses		2,500,000		(700,000	)		14,050,000		1,750,000
Net interest income after provision for loan losses		29,349,000		31,868,000			108,196,000		122,784,000
NONINTEREST INCOME
Service charges on accounts		1,177,000		1,178,000			4,578,000		4,584,000
Mortgage banking income		9,600,000		3,194,000			29,346,000		8,485,000
Credit and debit card income		1,602,000		1,528,000			5,973,000		5,925,000
Payroll services		399,000		399,000			1,745,000		1,626,000
Earnings on bank owned life insurance		281,000		319,000			1,214,000		3,886,000
Interest rate swap income		932,000		0			932,000		0
Other income		342,000		694,000			1,384,000		2,450,000
Total noninterest income		14,333,000		7,312,000			45,172,000		26,956,000
NONINTEREST EXPENSE
Salaries and benefits		15,411,000		13,851,000			59,799,000		53,833,000
Occupancy		2,006,000		1,972,000			7,950,000		7,061,000
Furniture and equipment		850,000		698,000			3,350,000		2,583,000
Data processing costs		2,647,000		2,381,000			10,440,000		9,235,000
Other expense		5,027,000		4,433,000			16,981,000		16,568,000
Total noninterest expense		25,941,000		23,335,000			98,520,000		89,280,000
Income before federal income tax expense		17,741,000		15,845,000			54,848,000		60,460,000
Federal income tax expense		3,659,000		2,528,000			10,710,000		11,004,000
Net Income	$	14,082,000	$	13,317,000		$	44,138,000	$	49,456,000
Basic earnings per share	$	0.87	$	0.81		$	2.71	$	3.01
Diluted earnings per share	$	0.87	$	0.81		$	2.71	$	3.01
Average basic shares outstanding		16,279,052		16,373,458			16,268,689		16,405,159
Average diluted shares outstanding		16,279,243		16,375,740			16,269,319		16,409,135

Mercantile Bank Corporation

Fourth Quarter 2020 Results

MERCANTILE BANK CORPORATION

CONSOLIDATED FINANCIAL HIGHLIGHTS

(Unaudited)

	Quarterly															Year-To-Date
(dollars in thousands except per share data)	2020			2020			2020			2020			2019
	4th Qtr			3rd Qtr			2nd Qtr			1st Qtr			4th Qtr			2020			2019
EARNINGS
Net interest income	$	31,849			29,509			30,571			30,317			31,168			122,246			124,534
Provision for loan losses	$	2,500			3,200			7,600			750			(700	)		14,050			1,750
Noninterest income	$	14,333			13,307			10,984			6,550			7,312			45,172			26,956
Noninterest expense	$	25,941			26,423			23,216			22,940			23,335			98,520			89,280
Net income before federal income tax expense	$	17,741			13,193			10,739			13,177			15,845			54,848			60,460
Net income	$	14,082			10,686			8,698			10,673			13,317			44,138			49,456
Basic earnings per share	$	0.87			0.66			0.54			0.65			0.81			2.71			3.01
Diluted earnings per share	$	0.87			0.66			0.54			0.65			0.81			2.71			3.01
Average basic shares outstanding		16,279,052			16,233,196			16,212,500			16,350,281			16,373,458			16,268,689			16,405,159
Average diluted shares outstanding		16,279,243			16,233,666			16,213,264			16,351,559			16,375,740			16,269,319			16,409,135
PERFORMANCE RATIOS
Return on average assets		1.25	%		0.98	%		0.85	%		1.19	%		1.45	%		1.07	%		1.39	%
Return on average equity		12.75	%		9.86	%		8.26	%		10.20	%		12.87	%		10.32	%		12.52	%
Net interest margin (fully tax-equivalent)		3.00	%		2.86	%		3.17	%		3.63	%		3.63	%		3.15	%		3.75	%
Efficiency ratio		56.17	%		61.71	%		55.87	%		62.22	%		60.64	%		58.85	%		58.93	%
Full-time equivalent employees		621			618			637			626			619			621			619
YIELD ON ASSETS / COST OF FUNDS
Yield on loans		4.34	%		4.03	%		4.18	%		4.69	%		5.01	%		4.31	%		5.11	%
Yield on securities		1.69	%		2.26	%		3.37	%		4.73	%		2.90	%		3.00	%		2.89	%
Yield on other interest-earning assets		0.12	%		0.12	%		0.15	%		1.22	%		1.65	%		0.25	%		2.07	%
Yield on total earning assets		3.55	%		3.45	%		3.85	%		4.54	%		4.61	%		3.82	%		4.77	%
Yield on total assets		3.35	%		3.25	%		3.62	%		4.23	%		4.31	%		3.59	%		4.45	%
Cost of deposits		0.37	%		0.41	%		0.48	%		0.70	%		0.79	%		0.48	%		0.81	%
Cost of borrowed funds		1.75	%		1.78	%		1.91	%		2.31	%		2.36	%		1.93	%		2.39	%
Cost of interest-bearing liabilities		0.91	%		0.99	%		1.11	%		1.36	%		1.47	%		1.09	%		1.50	%
Cost of funds (total earning assets)		0.55	%		0.59	%		0.68	%		0.91	%		0.98	%		0.67	%		1.02	%
Cost of funds (total assets)		0.51	%		0.56	%		0.64	%		0.85	%		0.91	%		0.63	%		0.95	%
PURCHASE ACCOUNTING ADJUSTMENTS
Loan portfolio - increase interest income	$	158			332			169			285			316			944			1,423
Trust preferred - increase interest expense	$	171			171			171			171			171			684			684
Core deposit intangible - increase overhead	$	318			318			371			397			397			1,404			1,721
MORTGAGE BANKING ACTIVITY
Total mortgage loans originated	$	218,904			237,195			275,486			132,859			110,611			864,444			368,600
Purchase mortgage loans originated	$	99,490			93,068			58,015			46,538			49,407			297,111			183,123
Refinance mortgage loans originated	$	119,414			144,127			217,471			86,321			61,204			567,333			185,477
Mortgage loans originated to sell	$	159,942			191,318			225,665			95,327			81,590			672,252			257,378
Net gain on sale of mortgage loans	$	9,476			10,199			7,760			2,086			3,062			29,521			8,065
CAPITAL
Tangible equity to tangible assets		8.89	%		8.69	%		8.74	%		10.14	%		10.15	%		8.89	%		10.15	%
Tier 1 leverage capital ratio		9.77	%		9.80	%		10.21	%		11.47	%		11.28	%		9.77	%		11.28	%
Common equity risk-based capital ratio		11.34	%		11.37	%		11.34	%		10.92	%		11.00	%		11.34	%		11.00	%
Tier 1 risk-based capital ratio		12.68	%		12.74	%		12.74	%		12.28	%		12.36	%		12.68	%		12.36	%
Total risk-based capital ratio		13.80	%		13.82	%		13.73	%		13.03	%		13.09	%		13.80	%		13.09	%
Tier 1 capital	$	430,146			420,225			412,526			406,445			405,148			430,146			405,148
Tier 1 plus tier 2 capital	$	468,113			455,797			444,772			431,273			429,038			468,113			429,038
Total risk-weighted assets	$	3,391,563			3,298,047			3,238,444			3,309,336			3,276,754			3,391,563			3,276,754
Book value per common share	$	27.04			26.59			26.20			25.82			25.36			27.04			25.36
Tangible book value per common share	$	23.86			23.37			22.96			22.55			22.12			23.86			22.12
Cash dividend per common share	$	0.28			0.28			0.28			0.28			0.27			1.12			1.06
ASSET QUALITY
Gross loan charge-offs	$	340			124			335			40			112			839			883
Recoveries	$	234			250			153			229			287			866			642
Net loan charge-offs (recoveries)	$	106			(126	)		182			(189	)		(175	)		(27	)		241
Net loan charge-offs to average loans		0.01	%		(0.02	%)		0.02	%		(0.03	%)		(0.02	%)		(0.01	%)		0.01	%
Allowance for loan losses	$	37,967			35,572			32,246			24,828			23,889			37,967			23,889
Allowance to loans		1.18	%		1.06	%		0.97	%		0.86	%		0.84	%		1.18	%		0.84	%

Allowance to loans excluding PPP loans		1.33	%	1.27	%	1.16	%	0.86	%	0.84	%	1.33	%	0.84	%
Nonperforming loans	$	3,384		4,141		3,212		3,469		2,284		3,384		2,284
Other real estate/repossessed assets	$	701		512		198		271		452		701		452
Nonperforming loans to total loans		0.11	%	0.12	%	0.10	%	0.12	%	0.08	%	0.11	%	0.08	%
Nonperforming assets to total assets		0.09	%	0.11	%	0.08	%	0.10	%	0.08	%	0.09	%	0.08	%
NONPERFORMING ASSETS - COMPOSITION
Residential real estate:
Land development	$	35		36		36		37		34		35		34
Construction	$	0		198		198		283		0		0		0
Owner occupied / rental	$	2,607		2,597		2,750		2,922		2,364		2,607		2,364
Commercial real estate:
Land development	$	0		0		0		43		0		0		0
Construction	$	0		0		0		0		0		0		0
Owner occupied	$	1,232		1,576		275		287		326		1,232		326
Non-owner occupied	$	22		23		25		0		0		22		0
Non-real estate:
Commercial assets	$	172		198		98		156		0		172		0
Consumer assets	$	17		25		28		12		12		17		12
Total nonperforming assets		4,085		4,653		3,410		3,740		2,736		4,085		2,736
NONPERFORMING ASSETS - RECON
Beginning balance	$	4,653		3,410		3,740		2,736		2,887		2,736		4,952
Additions	$	972		1,615		220		1,344		30		4,151		934
Other activity	$	0		0		0		(31	)	135		(31	)	226
Return to performing status	$	0		(72	)	(26	)	(7	)	0		(105	)	(126	)
Principal payments	$	(1,064	)	(249	)	(278	)	(110	)	(232	)	(1,701	)	(2,140	)
Sale proceeds	$	(245	)	0		(49	)	(192	)	(36	)	(486	)	(792	)
Loan charge-offs	$	(231	)	(51	)	(173	)	0		(48	)	(455	)	(289	)
Valuation write-downs	$	0		0		(24	)	0		0		(24	)	(29	)
Ending balance	$	4,085		4,653		3,410		3,740		2,736		4,085		2,736
LOAN PORTFOLIO COMPOSITION
Commercial:
Commercial & industrial	$	1,145,423		1,321,419		1,307,456		873,679		846,551		1,145,423		846,551
Land development & construction	$	55,055		50,941		52,984		62,908		56,118		55,055		56,118
Owner occupied comm'l R/E	$	529,953		549,364		567,621		579,229		579,004		529,953		579,004
Non-owner occupied comm'l R/E	$	917,436		878,897		841,145		823,366		835,345		917,436		835,345
Multi-family & residential rental	$	146,095		137,740		132,047		133,148		124,526		146,095		124,526
Total commercial	$	2,793,962		2,938,361		2,901,253		2,472,330		2,441,544		2,793,962		2,441,544
Retail:
1-4 family mortgages	$	360,776		348,460		367,060		356,338		339,749		360,776		339,749
Home equity & other consumer	$	61,620		63,723		64,743		72,875		75,374		61,620		75,374
Total retail	$	422,396		412,183		431,803		429,213		415,123		422,396		415,123
Total loans	$	3,216,358		3,350,544		3,333,056		2,901,543		2,856,667		3,216,358		2,856,667
END OF PERIOD BALANCES
Loans	$	3,216,358		3,350,544		3,333,056		2,901,543		2,856,667		3,216,358		2,856,667
Securities	$	405,349		330,426		325,663		330,149		352,657		405,349		352,657
Other interest-earning assets	$	563,174		495,308		386,711		186,938		180,469		563,174		180,469
Total earning assets (before allowance)	$	4,184,881		4,176,278		4,045,430		3,418,630		3,389,793		4,184,881		3,389,793
Total assets	$	4,437,344		4,420,610		4,314,379		3,657,387		3,632,915		4,437,344		3,632,915
Noninterest-bearing deposits	$	1,433,403		1,449,879		1,445,620		956,290		924,916		1,433,403		924,916
Interest-bearing deposits	$	1,978,150		1,922,155		1,816,660		1,689,126		1,765,468		1,978,150		1,765,468
Total deposits	$	3,411,553		3,372,034		3,262,280		2,645,416		2,690,384		3,411,553		2,690,384
Total borrowed funds	$	562,360		600,892		611,298		576,996		506,301		562,360		506,301
Total interest-bearing liabilities	$	2,540,510		2,523,047		2,427,958		2,266,122		2,271,769		2,540,510		2,271,769
Shareholders' equity	$	441,554		431,900		425,221		418,389		416,561		441,554		416,561
AVERAGE BALANCES
Loans	$	3,288,845		3,315,741		3,294,883		2,861,047		2,871,674		3,190,742		2,853,021
Securities	$	365,631		327,668		333,843		344,906		362,347		343,032		359,512
Other interest-earning assets	$	559,593		457,598		251,833		153,638		176,034		356,501		114,527
Total earning assets (before allowance)	$	4,214,069		4,101,007		3,880,559		3,359,591		3,410,055		3,890,275		3,327,060
Total assets	$	4,459,370		4,346,624		4,119,573		3,602,784		3,650,087		4,133,568		3,561,645
Noninterest-bearing deposits	$	1,478,616		1,454,887		1,304,986		923,827		948,602		1,291,542		902,180
Interest-bearing deposits	$	1,936,069		1,863,302		1,767,985		1,724,030		1,759,377		1,823,266		1,722,535
Total deposits	$	3,414,685		3,318,189		3,072,971		2,647,957		2,707,979		3,114,808		2,624,715
Total borrowed funds	$	588,100		583,994		607,074		517,961		509,932		574,347		525,745
Total interest-bearing liabilities	$	2,524,169		2,447,296		2,375,059		2,241,991		2,269,309		2,397,613		2,248,280
Shareholders' equity	$	438,171		429,865		422,230		419,612		410,593		427,505		394,913