EX-99.2 3 ibcp-20240725ex992.htm EX-99.2 Document

Exhibit 99.2
INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Supplemental Data

Non-performing assets

June 30, 2024March 31, 2024December 31, 2023September 30, 2023June 30, 2023
(Dollars in thousands)
Non-accrual loans$5,974 $5,355 $6,991 $6,969 $6,876 
Loans 90 days or more past due and still accruing interest— — 432 — — 
Subtotal5,974 5,355 7,423 6,969 6,876 
Less:  Government guaranteed loans1,489 1,665 2,191 2,254 2,882 
Total non-performing loans4,485 3,690 5,232 4,715 3,994 
Other real estate and repossessed assets945 1,059 569 443 658 
Total non-performing assets$5,430 $4,749 $5,801 $5,158 $4,652 
As a percent of Portfolio Loans
Non-performing loans0.12 %0.10 %0.14 %0.13 %0.11 %
Allowance for credit losses1.46 1.47 1.44 1.48 1.49 
Non-performing assets to total assets0.10 0.09 0.11 0.10 0.09 
Allowance for credit losses as a percent of non-performing loans1,253.98 1,526.10 1,044.69 1,176.99 1,351.13 





Allowance for credit losses

Six months ended June 30,
20242023
LoansSecuritiesUnfunded
Commitments
LoansSecuritiesUnfunded
Commitments
(Dollars in thousands)
Balance at beginning of period$54,658$157$5,504$52,435$168$5,080
Additions (deductions)
Provision for credit losses1,890(1,127)2,4852,992
Recoveries credited to allowance1,3951,1251,325
Assets charged against the allowance(1,702)(2,281)(3,000)
Additions included in non-interest expense(789)(375)
Balance at end of period$56,241$155$4,715$53,964$160$4,705
Net loans charged (recovered) against the allowance to average Portfolio Loans0.02 %0.05 %

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Capitalization

June 30, 2024December 31, 2023
(In thousands)
Subordinated debt$39,548 $39,510 
Subordinated debentures39,762 39,728 
Amount not qualifying as regulatory capital(772)(734)
Amount qualifying as regulatory capital78,538 78,504 
Shareholders’ equity
Common stock317,676 317,483 
Retained earnings183,611 159,108 
Accumulated other comprehensive income (loss)(70,828)(72,142)
Total shareholders’ equity430,459 404,449 
Total capitalization$508,997 $482,953 

Non-Interest Income

Three months endedSix months ended
June 30, 2024March 31, 2024June 30, 2023June 30,
20242023
(In thousands)
Interchange income$3,401 $3,151 $3,355 $6,552 $6,560 
Service charges on deposit accounts2,937 2,872 3,134 5,809 5,991 
Net gains (losses) on assets
Mortgage loans1,333 1,364 2,120 2,697 3,376 
Equity securities at fair value2,693 — — 2,693 — 
Securities— (269)— (269)(222)
Mortgage loan servicing, net2,091 2,725 3,674 4,816 4,400 
Investment and insurance commissions838 804 744 1,642 1,571 
Bank owned life insurance188 181 98 369 209 
Other1,691 1,733 2,292 3,424 4,083 
Total non-interest income$15,172 $12,561 $15,417 $27,733 $25,968 

Capitalized Mortgage Loan Servicing Rights

Three months ended June 30,Six months ended June 30,
2024202320242023
(In thousands)
Balance at beginning of period$43,577 $41,923 $42,243 $42,489 
Originated servicing rights capitalized952 1,023 1,780 1,953 
Change in fair value(123)1,481 383 (15)
Balance at end of period$44,406 $44,427 $44,406 $44,427 

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Mortgage Loan Activity

Three months endedSix months ended
June 30, 2024March 31, 2024June 30, 2023June 30,
20242023
(Dollars in thousands)
Mortgage loans originated$142,602$93,994$160,515$236,596$273,536
Mortgage loans sold91,54080,81899,025172,358205,871
Net gains on mortgage loans1,3331,3642,1202,6973,376
Net gains as a percent of mortgage loans sold  ("Loan Sales Margin")1.46 %1.69 %2.14 %1.56 %1.64 %
Fair value adjustments included in the Loan Sales Margin0.14 %0.44 %1.03 %0.28 %1.12 %

Non-Interest Expense

Three months endedSix months ended
June 30, 2024March 31, 2024June 30, 2023June 30,
20242023
(In thousands)
Compensation$13,390 $13,277 $13,523 $26,667 $26,792 
Performance-based compensation3,885 3,476 3,220 7,361 5,465 
Payroll taxes and employee benefits3,976 4,017 3,859 7,993 7,684 
Compensation and employee benefits21,251 20,770 20,602 42,021 39,941 
Data processing3,257 3,255 2,891 6,512 5,882 
Occupancy, net1,886 2,074 1,845 3,960 4,004 
Interchange expense1,127 1,097 1,054 2,224 2,103 
Furniture, fixtures and equipment948 954 929 1,902 1,855 
FDIC deposit insurance695 782 749 1,477 1,532 
Advertising788 491 431 1,279 926 
Loan and collection699 512 620 1,211 1,198 
Communications499 615 635 1,114 1,303 
Legal and professional544 486 473 1,030 1,080 
Supplies142 118 122 260 228 
Amortization of intangible assets129 129 137 258 274 
Correspondent bank service fees44 46 59 90 122 
Provision for loss reimbursement on sold loans(1)14 
Net (gains) losses on other real estate and repossessed assets(108)(76)63 (184)17 
Costs (recoveries) related to unfunded lending commitments(137)(652)100 (789)(375)
Other1,570 1,589 1,534 3,159 3,101 
Total non-interest expense$33,333 $32,193 $32,248 $65,526 $63,205 

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Average Balances and Tax Equivalent Rates

Three Months Ended June 30,
20242023
Average
Balance
InterestRate (2)Average
Balance
InterestRate (2)
(Dollars in thousands)
Assets
Taxable loans$3,840,343 $56,697 5.93 %$3,561,333 $47,617 5.36 %
Tax-exempt loans (1)8,856 113 5.13 6,587 78 4.75 
Taxable securities633,400 4,713 2.98 789,078 5,919 3.00 
Tax-exempt securities (1)311,035 3,551 4.57 322,592 3,499 4.34 
Interest bearing cash83,293 1,134 5.48 66,023 837 5.08 
Other investments16,440 305 7.46 17,682 230 5.22 
Interest Earning Assets4,893,367 66,513 5.45 4,763,295 58,180 4.89 
Cash and due from banks50,652 55,945 
Other assets, net237,298 225,506 
Total Assets$5,181,317 $5,044,746 
Liabilities
Savings and interest-bearing checking2,674,731 14,190 2.13 2,519,009 10,515 1.67 
Time deposits807,033 8,686 4.33 761,705 6,946 3.66 
Other borrowings130,208 2,116 6.54 134,907 2,137 6.35 
Interest Bearing Liabilities3,611,972 24,992 2.78 %3,415,621 19,598 2.30 
Non-interest bearing deposits1,050,153 1,167,129 
Other liabilities104,643 97,853 
Shareholders’ equity414,549 364,143 
Total liabilities and shareholders’ equity$5,181,317 $5,044,746 
Net Interest Income$41,521 $38,582 
Net Interest Income as a Percent of Average Interest Earning Assets3.40 %3.24 %

(1)Interest on tax-exempt loans and securities is presented on a fully tax equivalent basis assuming a marginal tax rate of 21%.
(2)Annualized


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Average Balances and Tax Equivalent Rates
Six Months Ended June 30,
20242023
Average
Balance
InterestRateAverage
Balance
InterestRate (2)
(Dollars in thousands)
Assets
Taxable loans$3,821,164 $111,652 5.87 %$3,524,639 $91,851 5.24 %
Tax-exempt loans (1)8,699 224 5.18 6,608 154 4.70 
Taxable securities656,766 9,964 3.03 805,733 11,803 2.93 
Tax-exempt securities (1)315,021 7,099 4.51 323,045 6,854 4.24 
Interest bearing cash83,738 2,277 5.47 52,531 1,301 4.99 
Other investments16,630 603 7.29 17,668 441 5.03 
Interest Earning Assets4,902,018 131,819 5.40 4,730,224 112,404 4.78 
Cash and due from banks53,101 58,182 
Other assets, net236,266 228,342 
Total Assets$5,191,385 $5,016,748 
Liabilities
Savings and interest-bearing checking2,654,125 27,557 2.09 2,526,982 19,372 1.55 
Time deposits835,852 18,129 4.36 709,983 11,849 3.37 
Other borrowings129,731 4,235 6.56 123,585 3,872 6.32 
Interest Bearing Liabilities3,619,708 49,921 2.77 %3,360,550 35,093 2.11 
Non-interest bearing deposits1,056,803 1,195,593 
Other liabilities105,987 100,152 
Shareholders’ equity408,887 360,453 
Total liabilities and shareholders’ equity$5,191,385 $5,016,748 
Net Interest Income$81,898 $77,311 
Net Interest Income as a Percent of Average Interest Earning Assets3.35 %3.28 %

(1)Interest on tax-exempt loans and securities is presented on a fully tax equivalent basis assuming a marginal tax rate of 21%.
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Commercial Loan Portfolio Analysis as of June 30, 2024

Total Commercial Loans
Watch CreditsPercent of Loan Category in Watch Credit
Loan CategoryAll LoansPerformingNon-accrualTotal
(Dollars in thousands)
Land$10,825 $— $— $— — %
Land Development17,663 — — — — 
Construction155,299 — — — — 
Income Producing572,179 4,215 — 4,215 0.7 
Owner Occupied483,992 14,447 — 14,447 3.0 
Total Commercial Real Estate Loans$1,239,958 $18,662 $— $18,662 1.5 
Other Commercial Loans$492,395 $19,011 312 $19,323 3.9 
Total non-performing commercial loans$312 

Commercial Loan Portfolio Analysis as of December 31, 2023

Total Commercial Loans
Watch CreditsPercent of Loan Category in Watch Credit
Loan CategoryAll LoansPerformingNon-accrualTotal
(Dollars in thousands)
Land$10,620 $$— $0.0 %
Land Development17,966 — — — — 
Construction101,178 — — — — 
Income Producing625,927 4,177 — 4,177 0.7 
Owner Occupied449,287 15,165 — 15,165 3.4 
Total Commercial Real Estate Loans$1,204,978 $19,343 $— $19,343 1.6 
Other Commercial Loans$474,753 $16,537 28 $16,565 3.5 
Total non-performing commercial loans$28 
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