Exhibit 99.1

Mercantile Bank Corporation Announces Strong Second Quarter 2023 Results

Significant year-over-year increase in net interest income, solid loan growth,

and ongoing strength in asset quality metrics highlight quarter

GRAND RAPIDS, Mich., July 18, 2023 – Mercantile Bank Corporation (NASDAQ: MBWM) ("Mercantile") reported net income of $20.4 million, or $1.27 per diluted share, for the second quarter of 2023, compared with net income of $11.7 million, or $0.74 per diluted share, for the respective prior-year period. Net income during the first six months of 2023 totaled $41.3 million, or $2.58 per diluted share, compared with net income of $23.2 million, or $1.47 per diluted share, during the first six months of 2022.

“We are very pleased to report another quarter of strong financial performance,” said Robert B. Kaminski, Jr., President and Chief Executive Officer of Mercantile. “Our robust operating results were driven by an approximately 39 percent increase in net interest income stemming from a higher net interest margin and solid loan growth. The sustained loan portfolio expansion and pristine asset quality metrics reflect our commitment to meeting the credit needs of our clients while utilizing sound underwriting practices and parameters. We believe our strong capital base positions us to withstand any challenges arising from changing economic conditions.”

Second quarter highlights include:

● Significant increase in net interest income depicting net interest margin expansion and loan growth

● Notable increases in several key fee income categories

● Annualized commercial loan growth of approximately 6 percent and continued residential mortgage loan portfolio expansion

● Sustained strength in commercial loan pipeline

● Ongoing low levels of nonperforming assets, past due loans, and loan charge-offs

● Strong capital position

Operating Results

Total revenue, which consists of net interest income and noninterest income, was $55.2 million during the second quarter of 2023, up $13.1 million, or 31.2 percent, from $42.1 million during the prior-year second quarter. Net interest income during the second quarter of 2023 was $47.6 million, up $13.2 million, or 38.5 percent, from $34.4 million during the respective 2022 period, mainly due to increased yields on earning assets and loan growth. Noninterest income totaled $7.6 million during the second quarter of 2023, compared to $7.7 million during the second quarter of 2022. Excluding a bank owned life insurance claim recorded in the second quarter of 2022, noninterest income increased $0.4 million, or 6.0 percent, in the second quarter of 2023 compared with the prior-year second quarter primarily due to higher levels of interest rate swap income, credit and debit card income, and payroll processing fees.

The net interest margin was 4.05 percent in the second quarter of 2023, up from 2.88 percent in the prior-year second quarter. The yield on average earning assets was 5.61 percent during the current-year second quarter, an increase from 3.32 percent during the respective 2022 period. The higher yield on average earning assets primarily resulted from an increased yield on loans. The yield on loans was 6.19 percent during the second quarter of 2023, up from 3.97 percent during the second quarter of 2022 mainly due to higher interest rates on variable-rate commercial loans stemming from the Federal Open Market Committee (“FOMC”) significantly raising the targeted federal funds rate in an effort to curb elevated inflation levels. The FOMC increased the targeted federal funds rate by 475 basis points during the period of May 2022 through May 2023. As of June 30, 2023, approximately 65 percent of the commercial loan portfolio consisted of variable-rate loans.

The cost of funds was 1.56 percent in the second quarter of 2023, up from 0.44 percent in the second quarter of 2022 primarily due to higher costs of deposits and borrowed funds, reflecting the impact of the rising interest rate environment, and a change in funding mix, consisting of a decrease in lower-cost non-time deposits and increases in higher-cost time deposits and borrowings as a percentage of interest-bearing liabilities. During the second quarter, a notable level of deposit funds migrated from lower-paying checking and savings accounts to higher-paying money market accounts and time deposits.

Mercantile recorded provisions for credit losses of $2.0 million and $0.5 million during the second quarters of 2023 and 2022, respectively. The provision expense recorded during the current-year second quarter mainly reflected allocations necessitated by net loan growth and adjustments to historical loss factors to better represent Mercantile’s expectations for future credit losses. The provision expense recorded during the second quarter of 2022 primarily reflected allocations necessitated by net commercial and residential mortgage loan growth, increased specific reserves for certain problem commercial loan relationships, and a higher reserve for residential mortgage loans.

Noninterest income during the second quarter of 2023 was $7.6 million, compared to $7.7 million during the respective 2022 period. Noninterest income during the second quarter of 2022 included a $0.5 million bank owned life insurance claim. Excluding the impact of this transaction, noninterest income increased $0.4 million, or 6.0 percent, during the second quarter of 2023 compared with the prior-year second quarter. The higher level of noninterest income primarily stemmed from increased interest rate swap income, credit and debit card income, and payroll servicing fees, which more than offset decreased service charges on accounts and mortgage banking income. The decline in service charges on accounts reflected increased earnings credit rates in response to the increasing interest rate environment.

Noninterest expense totaled $27.8 million during the second quarter of 2023, compared to $26.9 million during the prior-year second quarter. The increase in noninterest expense mainly resulted from larger compensation costs, including salary increases and a higher bonus and commercial lender incentive accrual, which outweighed a reduction in residential mortgage lender commissions. The higher level of salary expense primarily stemmed from annual merit pay increases and market adjustments, as well as lower residential mortgage loan deferred salary costs. The reduced residential mortgage lender commissions and incentives mainly resulted from decreased loan production. The increase in overhead costs during the second quarter of 2023 also resulted from the recording of an increased credit reserve for unfunded loan commitments and higher levels of Federal Deposit Insurance Corporation deposit insurance premiums, reflecting a higher industry-wide assessment rate, and interest rate swap credit reserves and associated collateral interest costs.

Mr. Kaminski commented, “The noteworthy increases in net interest income during the second quarter and first six months of 2023 compared to the respective 2022 periods mainly reflected vastly improved net interest margins and robust loan growth. We are pleased with the increases in several key fee income categories and remain focused on meeting growth objectives in a disciplined manner. Noninterest expense control continues to be a fundamental operating initiative, and we are continually examining our cost structure to identify further opportunities to enhance efficiency while still providing outstanding service to our customers.”

Balance Sheet

As of June 30, 2023, total assets were $5.14 billion, up $265 million from December 31, 2022. Total loans increased $135 million, or an annualized 6.9 percent, during the first six months of 2023, mainly reflecting growth in residential mortgage loans and commercial loans of $78.2 million and $56.8 million, respectively. Commercial loans and residential mortgage loans were up $48.2 million and $38.2 million, respectively, during the second quarter of 2023. Commercial loans increased despite the full payoffs and partial paydowns of certain larger relationships, which aggregated approximately $108 million and $174 million during the second quarter and first six months of 2023, respectively. The payoffs and paydowns mainly stemmed from customers refinancing debt on the secondary market and using excess cash flows generated within their operations to make unscheduled principal and line of credit payments. Interest-earning deposits increased $104 million during the first six months of 2023, in large part reflecting a strategic initiative to enhance on-balance sheet liquidity.

As of June 30, 2023, unfunded commitments on commercial construction and development loans, which are anticipated to be funded over the next 12 to 18 months, and residential construction loans, which are expected to be largely funded over the next 12 months, totaled $327 million and $58.6 million, respectively.

Ray Reitsma, President of Mercantile Bank, noted, “Although impeded by full and partial payoffs, commercial loan growth was solid during the second quarter of 2023. In addition to the payoffs stemming from customers refinancing debt on the secondary market and using excess cash flows to reduce debt, $12.8 million in payoffs related to borrowers that were experiencing financial duress and placed on our internal watch list occurred during the second quarter. Commercial and industrial loan growth accounted for approximately 80 percent of the increase in commercial loans during the second quarter, providing our lenders and treasury management personnel with additional opportunities to enhance commercial banking-related fee income and grow local deposits. Our healthy commercial loan pipeline and credit availability for commercial construction and development loans provide opportunities for future portfolio growth. As part of our efforts to meet commercial loan growth goals, we will continue to employ sound underwriting practices. Despite ongoing headwinds, including the higher interest rate environment and limited housing inventory levels, the residential mortgage loan portfolio expanded during the second quarter of 2023, as it did all throughout 2022 and the first three months of 2023.”

Commercial and industrial loans and owner-occupied commercial real estate loans combined represented approximately 59 percent of total commercial loans as of June 30, 2023, a level that has remained relatively consistent with prior periods and in line with Mercantile’s expectations.

Total deposits at June 30, 2023, were $3.76 billion, up $159 million, or 4.4 percent, from March 31, 2023, and $44.0 million, or 1.2 percent, from December 31, 2022. Local deposits increased $47.5 million and decreased $67.3 million during the second quarter and first six months of 2023, respectively, while brokered deposits grew $111 million during the first six months of 2023, all of which occurred during the second quarter. The net reduction in local deposits during the first six months of 2023 primarily reflected a customary level of customers’ tax and bonus payments and partnership distributions, as well as transfers to the sweep account product, during the first quarter. The growth in local deposits during the second quarter of 2023 mainly depicted the anticipated buildup in existing customers’ deposit balances that typically begins after the previously mentioned seasonal payments are made and generally continues during the remainder of each year. Wholesale funds, consisting of brokered deposits and Federal Home Loan Bank of Indianapolis advances, were $598 million, or approximately 13 percent of total funds, at June 30, 2023, compared with $308 million, or approximately 7 percent of total funds, at December 31, 2022. Wholesale funds totaling $311 million were obtained during the first six months of 2023 to increase on-balance sheet liquidity and offset loan growth, seasonal deposit withdrawals, and wholesale fund maturities.

Asset Quality

Nonperforming assets totaled $2.8 million, $8.4 million, $7.7 million, and $1.8 million, at June 30, 2023, March 31, 2023, December 31, 2022, and June 30, 2022, respectively, with each dollar amount representing less than 0.2 percent of total assets as of the respective dates. The decrease in nonperforming assets during the second quarter and first six months of 2023 primarily reflected the near full payoff of one large commercial loan relationship, which had been placed on nonaccrual during the fourth quarter of 2022; a charge-off of less than $0.1 million was recorded as part of the relationship’s resolution. A former branch facility, which was transferred into other real estate owned in the first quarter of 2023 and is under contract to be sold in the third quarter of 2023, accounted for approximately 22 percent of total nonperforming assets as of June 30, 2023.

The level of past due loans remains nominal, and the dollar volume of loan relationships on the internal watch list declined during the first six months of 2023. During the second quarter of 2023, loan charge-offs were $0.5 million, while recoveries of prior period loan charge-offs equaled $0.3 million, providing for net loan charge-offs of $0.2 million, or an annualized 0.02 percent of average total loans.

Mr. Reitsma commented, “Our asset quality measures remained strong during the second quarter, reflecting our ongoing commitment to underwriting loans in a sound and vigilant manner and our borrowers’ sustained abilities to effectively manage issues stemming from the current operating environment, including higher interest rates and associated increase in debt service requirements. Through our robust loan review program and emphasis on early recognition and reporting of deteriorating credit relationships, we believe we are well positioned to identify credit issues and limit their impact on our overall financial condition.”

Capital Position

Shareholders’ equity totaled $479 million as of June 30, 2023, up $37.3 million from year-end 2022. Mercantile Bank maintains a “well-capitalized” position, with its total risk-based capital ratio at 13.7 percent as of June 30, 2023, unchanged from December 31, 2022. At June 30, 2023, Mercantile Bank had approximately $177 million in excess of the 10 percent minimum regulatory threshold required to be categorized as a “well-capitalized” institution.

All of Mercantile’s investments are categorized as available-for-sale. As of June 30, 2023, the net unrealized loss on these investments totaled $77.9 million, resulting in an after-tax reduction to equity capital of $61.5 million. Although unrealized gains and losses on investments are excluded from regulatory capital ratio calculations, our excess capital over the minimum regulatory requirement to be considered a “well-capitalized” institution would approximate $115 million on an adjusted basis.

Mercantile reported 16,018,048 total shares outstanding at June 30, 2023.

Mr. Kaminski concluded, “As demonstrated by our Board of Directors’ declaration of an increased third quarter 2023 regular cash dividend, our sustained financial strength has allowed us to reward shareholders with competitive dividend yields while supporting loan portfolio expansion. We believe our strong overall financial condition, including solid capital levels, pristine asset quality measures, robust operating performance, and substantial loan origination opportunities, should allow us to successfully navigate through the myriad of challenges that could arise from changing economic conditions. While concerns about banks’ liquidity positions and the stability of banks’ deposit portfolios have eased, we continue to closely monitor our deposit base for any atypical activities, and to date believe that it remains stable. We increased our on-balance sheet liquidity during the second quarter of 2023 and believe our liquidity position remains sufficient to meet expected funding requirements. Our strong financial performance during the first six months of 2023 and anticipated loan growth give us confidence that robust operating results can be delivered during the remainder of the year and beyond as we continue our efforts to be a consistent and profitable performer.”

Investor Presentation

Mercantile has prepared presentation materials that management intends to use during its previously announced second quarter 2023 conference call on Tuesday, July 18, 2023, at 10:00 a.m. Eastern Time, and from time to time thereafter in presentations about the company’s operations and performance. These materials are available for viewing in the Investor Relations section of Mercantile’s website at www.mercbank.com, and have also been furnished to the U.S. Securities and Exchange Commission concurrently with this press release.

About Mercantile Bank Corporation

Based in Grand Rapids, Michigan, Mercantile Bank Corporation is the bank holding company for Mercantile Bank.  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 $5.1 billion and operates 46 banking offices. Mercantile Bank Corporation’s common stock is listed on the NASDAQ Global Select Market under the symbol “MBWM.” For more information about Mercantile, visit www.mercbank.com, and follow us on Facebook, Instagram and Twitter @MercBank and on LinkedIn at www.linkedin.com/company/merc-bank.

Forward-Looking Statements

This news release contains statements or information that may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: “anticipate,” “intend,” “plan,” “goal,” “seek,” “believe,” “project,” “estimate,” “expect,” “strategy,” “future,” “likely,” “may,” “should,” “will,” and similar references to future periods. Any such statements 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; increasing rates of inflation and slower growth rates or recession; significant declines in the value of commercial real estate; market volatility; demand for products and services; climate impacts; labor markets; the degree of competition by traditional and nontraditional financial services companies; changes in banking regulation or actions by bank regulators; changes in tax laws and other laws and regulations applicable to us; 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 existing or future contingencies; trends in customer behavior as well as their ability to repay loans; changes in local real estate values; damage to our reputation resulting from adverse publicity, regulatory actions, litigation, operational failures, and the failure to meet client expectations and other facts; the transition from LIBOR to SOFR; changes in the national and local economies; unstable political and economic environments; disease outbreaks, such as the COVID-19 pandemic or similar public health threats, and measures implemented to combat them; and other factors, including those expressed as 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. Investors are cautioned not to place undue reliance on any forward-looking statements contained herein.

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

Second Quarter 2023 Results

MERCANTILE BANK CORPORATION

CONSOLIDATED BALANCE SHEETS

(Unaudited)

	JUNE 30,			DECEMBER 31,			JUNE 30,
	2023			2022			2022
ASSETS
Cash and due from banks	$	69,133,000		$	61,894,000		$	89,167,000
Other interest-earning assets		138,663,000			34,878,000			389,938,000
Total cash and cash equivalents		207,796,000			96,772,000			479,105,000
Securities available for sale		608,972,000			602,936,000			603,638,000
Federal Home Loan Bank stock		21,513,000			17,721,000			17,721,000
Mortgage loans held for sale		11,942,000			3,565,000			12,964,000
Loans		4,051,843,000			3,916,619,000			3,723,800,000
Allowance for credit losses		(44,721,000	)		(42,246,000	)		(35,974,000	)
Loans, net		4,007,122,000			3,874,373,000			3,687,826,000
Premises and equipment, net		52,291,000			51,476,000			51,402,000
Bank owned life insurance		81,500,000			80,727,000			75,664,000
Goodwill		49,473,000			49,473,000			49,473,000
Core deposit intangible, net		291,000			583,000			900,000
Other assets		96,687,000			94,993,000			79,862,000
Total assets	$	5,137,587,000		$	4,872,619,000		$	5,058,555,000
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Noninterest-bearing	$	1,371,633,000		$	1,604,750,000		$	1,740,432,000
Interest-bearing		2,385,156,000			2,108,061,000			2,133,461,000
Total deposits		3,756,789,000			3,712,811,000			3,873,893,000
Securities sold under agreements to repurchase		219,457,000			194,340,000			203,339,000
Federal Home Loan Bank advances		467,910,000			308,263,000			362,263,000
Subordinated debentures		49,301,000			48,958,000			48,585,000
Subordinated notes		88,800,000			88,628,000			88,457,000
Accrued interest and other liabilities		76,628,000			78,211,000			53,035,000
Total liabilities		4,658,885,000			4,431,211,000			4,629,572,000
SHAREHOLDERS' EQUITY
Common stock		292,906,000			290,436,000			288,199,000
Retained earnings		247,313,000			216,313,000			188,452,000
Accumulated other comprehensive income/(loss)		(61,517,000	)		(65,341,000	)		(47,668,000	)
Total shareholders' equity		478,702,000			441,408,000			428,983,000
Total liabilities and shareholders' equity	$	5,137,587,000		$	4,872,619,000		$	5,058,555,000

Mercantile Bank Corporation

Second Quarter 2023 Results

MERCANTILE BANK CORPORATION

CONSOLIDATED REPORTS OF INCOME

(Unaudited)

	THREE MONTHS ENDED		THREE MONTHS ENDED		SIX MONTHS ENDED		SIX MONTHS ENDED
	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
INTEREST INCOME
Loans, including fees	$	62,006,000	$	36,003,000	$	119,159,000	$	69,254,000
Investment securities		3,111,000		2,529,000		6,118,000		4,794,000
Other interest-earning assets		801,000		1,018,000		1,125,000		1,384,000
Total interest income		65,918,000		39,550,000		126,402,000		75,432,000
INTEREST EXPENSE
Deposits		12,379,000		1,873,000		20,286,000		3,698,000
Short-term borrowings		914,000		49,000		1,373,000		99,000
Federal Home Loan Bank advances		3,051,000		1,911,000		4,845,000		3,774,000
Other borrowed money		2,023,000		1,391,000		3,963,000		2,650,000
Total interest expense		18,367,000		5,224,000		30,467,000		10,221,000
Net interest income		47,551,000		34,326,000		95,935,000		65,211,000
Provision for credit losses		2,000,000		500,000		2,600,000		600,000
Net interest income after provision for credit losses		45,551,000		33,826,000		93,335,000		64,611,000
NONINTEREST INCOME
Service charges on accounts		1,064,000		1,495,000		2,041,000		2,910,000
Credit and debit card income		2,426,000		2,134,000		4,485,000		4,015,000
Mortgage banking income		1,835,000		1,947,000		3,050,000		5,228,000
Interest rate swap income		748,000		430,000		1,785,000		1,781,000
Payroll services		572,000		464,000		1,317,000		1,102,000
Earnings on bank owned life insurance		402,000		785,000		802,000		1,072,000
Other income		598,000		486,000		1,117,000		910,000
Total noninterest income		7,645,000		7,741,000		14,597,000		17,018,000
NONINTEREST EXPENSE
Salaries and benefits		16,461,000		15,676,000		33,143,000		31,186,000
Occupancy		2,098,000		2,064,000		4,387,000		4,168,000
Furniture and equipment		878,000		935,000		1,700,000		1,869,000
Data processing costs		2,881,000		3,091,000		6,043,000		6,064,000
Charitable foundation contributions		2,000		506,000		12,000		506,000
Other expense		5,509,000		4,670,000		11,144,000		8,891,000
Total noninterest expense		27,829,000		26,942,000		56,429,000		52,684,000
Income before federal income tax expense		25,367,000		14,625,000		51,503,000		28,945,000
Federal income tax expense		5,010,000		2,888,000		10,171,000		5,716,000
Net Income	$	20,357,000	$	11,737,000	$	41,332,000	$	23,229,000
Basic earnings per share	$	1.27	$	0.74	$	2.58	$	1.47
Diluted earnings per share	$	1.27	$	0.74	$	2.58	$	1.47
Average basic shares outstanding		16,003,372		15,848,681		15,999,775		15,844,763
Average diluted shares outstanding		16,003,372		15,848,681		15,999,775		15,844,790

Mercantile Bank Corporation

Second Quarter 2023 Results

MERCANTILE BANK CORPORATION

CONSOLIDATED FINANCIAL HIGHLIGHTS

(Unaudited)

	Quarterly															Year-To-Date
(dollars in thousands except per share data)	2023			2023			2022			2022			2022
	2nd Qtr			1st Qtr			4th Qtr			3rd Qtr			2nd Qtr			2023			2022
EARNINGS
Net interest income	$	47,551			48,384			50,657			42,376			34,326			95,935			65,211
Provision for credit losses	$	2,000			600			3,050			2,900			500			2,600			600
Noninterest income	$	7,645			6,951			7,805			7,253			7,741			14,597			17,018
Noninterest expense	$	27,829			28,599			28,541			26,756			26,942			56,429			52,684
Net income before federal income tax expense	$	25,367			26,136			26,871			19,973			14,625			51,503			28,945
Net income	$	20,357			20,974			21,803			16,030			11,737			41,332			23,229
Basic earnings per share	$	1.27			1.31			1.37			1.01			0.74			2.58			1.47
Diluted earnings per share	$	1.27			1.31			1.37			1.01			0.74			2.58			1.47
Average basic shares outstanding		16,003,372			15,996,138			15,887,983			15,861,551			15,848,681			15,999,775			15,844,763
Average diluted shares outstanding		16,003,372			15,996,138			15,887,983			15,861,551			15,848,681			15,999,775			15,844,790
PERFORMANCE RATIOS
Return on average assets		1.64	%		1.75	%		1.75	%		1.27	%		0.93	%		1.69	%		0.91	%
Return on average equity		17.23	%		18.76	%		20.26	%		14.79	%		10.98	%		17.97	%		10.66	%
Net interest margin (fully tax-equivalent)		4.05	%		4.28	%		4.30	%		3.56	%		2.88	%		4.16	%		2.73	%
Efficiency ratio		50.42	%		51.69	%		48.82	%		53.91	%		64.05	%		51.05	%		64.07	%
Full-time equivalent employees		665			633			630			635			651			665			651
YIELD ON ASSETS / COST OF FUNDS
Yield on loans		6.19	%		5.90	%		5.49	%		4.56	%		3.97	%		6.05	%		3.92	%
Yield on securities		2.00	%		1.95	%		1.91	%		1.79	%		1.68	%		1.98	%		1.60	%
Yield on other interest-earning assets		4.88	%		4.18	%		3.60	%		2.15	%		0.76	%		4.65	%		0.42	%
Yield on total earning assets		5.61	%		5.35	%		4.95	%		4.04	%		3.32	%		5.48	%		3.16	%
Yield on total assets		5.30	%		5.06	%		4.68	%		3.80	%		3.13	%		5.18	%		2.97	%
Cost of deposits		1.36	%		0.87	%		0.42	%		0.24	%		0.19	%		1.12	%		0.19	%
Cost of borrowed funds		2.90	%		2.51	%		2.13	%		1.99	%		1.90	%		2.73	%		1.86	%
Cost of interest-bearing liabilities		2.37	%		1.72	%		1.10	%		0.81	%		0.72	%		2.06	%		0.69	%
Cost of funds (total earning assets)		1.56	%		1.07	%		0.65	%		0.48	%		0.44	%		1.32	%		0.43	%
Cost of funds (total assets)		1.48	%		1.01	%		0.61	%		0.45	%		0.41	%		1.25	%		0.40	%
MORTGAGE BANKING ACTIVITY
Total mortgage loans originated	$	117,563			71,991			90,794			163,902			190,896			189,554			359,083
Purchase mortgage loans originated	$	100,941			56,728			79,604			140,898			157,423			157,669			258,832
Refinance mortgage loans originated	$	16,622			15,263			11,190			23,004			33,473			31,885			100,251
Total saleable mortgage loans	$	50,734			24,904			29,948			59,740			52,328			75,638			128,075
Income on sale of mortgage loans	$	1,570			950			1,401			1,779			1,751			2,520			4,955
CAPITAL
Tangible equity to tangible assets		8.43	%		8.61	%		8.12	%		7.37	%		7.56	%		8.43	%		7.56	%
Tier 1 leverage capital ratio		10.73	%		10.66	%		10.09	%		9.63	%		9.31	%		10.73	%		9.31	%
Common equity risk-based capital ratio		10.25	%		10.25	%		10.08	%		9.80	%		9.84	%		10.25	%		9.84	%
Tier 1 risk-based capital ratio		11.24	%		11.27	%		11.12	%		10.84	%		10.91	%		11.24	%		10.91	%
Total risk-based capital ratio		14.03	%		14.11	%		14.00	%		13.69	%		13.78	%		14.03	%		13.78	%
Tier 1 capital	$	537,802			520,918			503,855			485,499			473,065			537,802			473,065
Tier 1 plus tier 2 capital	$	671,323			652,509			634,729			613,161			597,495			671,323			597,495
Total risk-weighted assets	$	4,784,428			4,623,631			4,533,091			4,479,176			4,337,040			4,784,428			4,337,040
Book value per common share	$	29.89			29.21			27.60			26.24			27.05			29.89			27.05
Tangible book value per common share	$	26.78			26.09			24.47			23.07			23.87			26.78			23.87
Cash dividend per common share	$	0.33			0.33			0.32			0.32			0.31			0.66			0.62
ASSET QUALITY
Gross loan charge-offs	$	461			106			72			0			15			567			220
Recoveries	$	305			137			149			246			336			442			630
Net loan charge-offs (recoveries)	$	156			(31	)		(77	)		(246	)		(321	)		125			(410	)
Net loan charge-offs to average loans		0.02	%		(0.01	%)		(0.01	%)		(0.03	%)		(0.04	%)		0.01	%		(0.02	%)
Allowance for credit losses	$	44,721			42,877			42,246			39,120			35,974			44,721			35,974
Allowance to loans		1.10	%		1.08	%		1.08	%		1.01	%		0.97	%		1.10	%		0.97	%
Nonperforming loans	$	2,099			7,782			7,728			1,416			1,787			2,099			1,787
Other real estate/repossessed assets	$	661			661			0			0			0			661			0
Nonperforming loans to total loans		0.05	%		0.20	%		0.20	%		0.04	%		0.05	%		0.05	%		0.05	%
Nonperforming assets to total assets		0.05	%		0.17	%		0.16	%		0.03	%		0.04	%		0.05	%		0.04	%
NONPERFORMING ASSETS - COMPOSITION
Residential real estate:
Land development	$	2			8			29			30			30			2			30
Construction	$	0			0			124			0			0			0			0
Owner occupied / rental	$	1,793			1,952			1,304			1,138			1,508			1,793			1,508
Commercial real estate:
Land development	$	0			0			0			0			0			0			0
Construction	$	0			0			0			0			0			0			0
Owner occupied	$	716			829			248			0			0			716			0
Non-owner occupied	$	0			0			0			0			0			0			0
Non-real estate:
Commercial assets	$	249			5,654			6,023			248			248			249			248
Consumer assets	$	0			0			0			0			1			0			1
Total nonperforming assets	$	2,760			8,443			7,728			1,416			1,787			2,760			1,787
NONPERFORMING ASSETS - RECON
Beginning balance	$	8,443			7,728			1,416			1,787			1,612			7,728			2,468
Additions	$	273			1,323			6,368			0			309			1,596			402
Return to performing status	$	0			(31	)		0			(160	)		0			(31	)		(213	)
Principal payments	$	(5,526	)		(515	)		(56	)		(211	)		(134	)		(6,041	)		(775	)
Sale proceeds	$	0			0			0			0			0			0			0
Loan charge-offs	$	(430	)		(62	)		0			0			0			(492	)		(95	)
Valuation write-downs	$	0			0			0			0			0			0			0
Ending balance	$	2,760			8,443			7,728			1,416			1,787			2,760			1,787
LOAN PORTFOLIO COMPOSITION
Commercial:
Commercial & industrial	$	1,212,196			1,173,440			1,185,084			1,213,630			1,187,650			1,212,196			1,187,650
Land development & construction	$	72,682			66,233			61,873			60,970			57,808			72,682			57,808
Owner occupied comm'l R/E	$	659,201			630,186			639,192			643,577			598,593			659,201			598,593
Non-owner occupied comm'l R/E	$	957,221			975,735			979,214			963,144			974,009			957,221			974,009
Multi-family & residential rental	$	287,285			294,825			266,468			263,741			253,700			287,285			253,700
Total commercial	$	3,188,585			3,140,419			3,131,831			3,145,062			3,071,760			3,188,585			3,071,760
Retail:
1-4 family mortgages & home equity	$	833,198			795,009			755,035			705,442			623,599			833,198			623,599
Other consumer	$	30,060			30,100			29,753			30,454			28,441			30,060			28,441
Total retail	$	863,258			825,109			784,788			735,896			652,040			863,258			652,040
Total loans	$	4,051,843			3,965,528			3,916,619			3,880,958			3,723,800			4,051,843			3,723,800
END OF PERIOD BALANCES
Loans	$	4,051,843			3,965,528			3,916,619			3,880,958			3,723,800			4,051,843			3,723,800
Securities	$	630,485			637,694			620,657			600,720			621,359			630,485			621,359
Other interest-earning assets	$	138,663			10,787			34,878			220,909			389,938			138,663			389,938
Total earning assets (before allowance)	$	4,820,991			4,614,009			4,572,154			4,702,587			4,735,097			4,820,991			4,735,097
Total assets	$	5,137,587			4,895,874			4,872,619			5,016,934			5,058,555			5,137,587			5,058,555
Noninterest-bearing deposits	$	1,371,633			1,376,782			1,604,750			1,716,904			1,740,432			1,371,633			1,740,432
Interest-bearing deposits	$	2,385,156			2,221,236			2,108,061			2,129,181			2,133,461			2,385,156			2,133,461
Total deposits	$	3,756,789			3,598,018			3,712,811			3,846,085			3,873,893			3,756,789			3,873,893
Total borrowed funds	$	826,558			761,509			641,295			675,332			703,809			826,558			703,809
Total interest-bearing liabilities	$	3,211,714			2,982,745			2,749,356			2,804,513			2,837,270			3,211,714			2,837,270
Shareholders' equity	$	478,702			467,372			441,408			416,261			428,983			478,702			428,983
AVERAGE BALANCES
Loans	$	4,017,690			3,928,329			3,887,967			3,814,338			3,633,587			3,973,256			3,559,461
Securities	$	634,607			627,628			606,390			618,043			615,733			631,137			614,532
Other interest-earning assets	$	64,958			31,081			179,507			294,969			530,571			48,113			656,682
Total earning assets (before allowance)	$	4,717,255			4,587,038			4,673,864			4,727,350			4,779,891			4,652,506			4,830,675
Total assets	$	4,988,413			4,855,877			4,949,868			5,025,998			5,077,458			4,922,511			5,122,758
Noninterest-bearing deposits	$	1,361,901			1,491,477			1,722,632			1,723,609			1,706,349			1,426,331			1,666,125
Interest-bearing deposits	$	2,278,877			2,184,406			2,077,547			2,144,047			2,201,797			2,231,902			2,282,667
Total deposits	$	3,640,778			3,675,883			3,800,179			3,867,656			3,908,146			3,658,233			3,948,792
Total borrowed funds	$	827,105			676,724			667,864			689,091			705,774			752,330			706,621
Total interest-bearing liabilities	$	3,105,982			2,861,130			2,745,411			2,833,138			2,907,571			2,984,232			2,989,288
Shareholders' equity	$	473,983			453,524			426,897			430,093			428,873			483,810			439,310