INDEPENDENT BANK CORPORATION FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 FOR THE QUARTERLY PERIOD ENDED
Commission file number 0-7818
INDEPENDENT BANK CORPORATION (Exact name of registrant as specified in its charter)
Michigan 38-2032782
(State or jurisdiction of Incorporation (I.R.S. Employer Identification Number)
or Organization)
4200 East Beltline,
(Address of principal executive offices)
(616) 527-5820
(Registrant's telephone number, including area code)
NONEFormer name, address and fiscal year, if changed since last report.
Securities registered pursuant to Section 12(b) of the Act:
Title of each Class Trading Symbol Name of each exchange which
registered
Common stock, no par value IBCP The Nasdaq Stock Market, LLC
Indicate by check mark whether the registrant (1) has filed all documents and reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES ? NO ?
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). YES ? NO ?
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, non-accelerated filer, smaller reporting company or an emerging growth company. Large accelerated filer ? Accelerated filer ? Non-accelerated filer ? Smaller reporting company ? Emerging growth company ?
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to section 13(a) of the Exchange Act. Yes ? No ?
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ? NO ?
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: common stock, no par value,
21,047,519 as of
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INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
INDEX
Number(s)
PART I - Financial Information
Item 1. Condensed Consolidated Statements of Financial Condition 3
March 31, 2022 and December 31, 2021
Condensed Consolidated Statements of Operations Three-month 4
periods ended March 31, 2022 and 2021
Condensed Consolidated Statements of Comprehensive Income 5
Three-month periods ended March 31, 2022 and 2021
Condensed Consolidated Statements of Cash Flows Three-month 6
periods ended March 31, 2022 and 2021
Condensed Consolidated Statements of Shareholders' Equity 7
Three-month periods ended March 31, 2022 and 2021
Notes to Interim Condensed Consolidated Financial 8-57
StatementsItem 2. Management's Discussion and Analysis of Financial Condition 58-79
and Results of Operations Item 3. Quantitative and Qualitative Disclosures about Market Risk 80 Item 4. Controls and Procedures
80
PART II - Other Information
Item 1A Risk Factors 81
Item 2. Unregistered Sales of Equity Securities and Use of 81
Proceeds
Item 6. Exhibits 82
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Index
FORWARD-LOOKING STATEMENTS
Statements in this report that are not statements of historical fact, including statements that include terms such as ''will,'' ''may,'' ''should,'' ''believe,'' ''expect,'' ''forecast,'' ''anticipate,'' ''estimate,'' ''project,'' ''intend,'' ''likely,'' ''optimistic'' and ''plan'' and statements about future or projected financial and operating results, plans, projections, objectives, expectations, and intentions, are forward-looking statements. Forward-looking statements include, but are not limited to, descriptions of plans and objectives for future operations, products or services; projections of our future revenue, earnings or other measures of economic performance; forecasts of credit losses and other asset quality trends; statements about our business and growth strategies; and expectations about economic and market conditions and trends. These forward-looking statements express our current expectations, forecasts of future events, or long-term goals. They are based on assumptions, estimates, and forecasts that, although believed to be reasonable, may turn out to be incorrect. Actual results could differ materially from those discussed in the forward-looking statements for a variety of reasons, including:
• economic, market, operational, liquidity, credit, and interest rate risks
associated with our business including the impact of the ongoing COVID-19
pandemic on each of these items;
• economic conditions generally and in the financial services industry,
particularly economic conditions withinMichigan and the regional and local real estate markets in which our bank operates including the economic impact of the ongoing COVID-19 pandemic in each of these areas;
• the failure of assumptions underlying the establishment of, and provisions made
to, our allowance for credit losses;
• increased competition in the financial services industry, either nationally or
regionally;
• our ability to achieve loan and deposit growth;
• volatility and direction of market interest rates;
• the continued services of our management team; and
• implementation of new legislation, which may have significant effects on us and
the financial services industry.
This list provides examples of factors that could affect the results described
by forward-looking statements contained in this report, but the list is not
intended to be all-inclusive. The risk factors disclosed in Part I - Item 1A of
our Annual Report on Form 10-K for the year ended
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Index
Part I - Item 1. INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statements of Financial Condition
March 31, December 31,
2022 2021
(Unaudited)
(In thousands, except share
amounts)
Assets
Cash and due from banks $ 46,600 $ 51,069
Interest bearing deposits 63,221 58,404
Cash and Cash Equivalents 109,821 109,473
Securities available for sale 1,400,137 1,412,830
17,653 18,427
Loans held for sale, carried at fair value 29,514 55,470
Loans held for sale, carried at lower of cost or fair value - 34,811
Loans
Commercial 1,257,601 1,203,581
Mortgage 1,170,059 1,139,659
Installment 576,405 561,805
Total Loans 3,004,065 2,905,045
Allowance for credit losses (45,627 ) (47,252 )
Net Loans 2,958,438 2,857,793
Other real estate and repossessed assets, net 438 245
Property and equipment, net 37,385 36,404
Bank-owned life insurance 54,984 55,279
Capitalized mortgage loan servicing rights, carried at fair value
35,933 26,232
Other intangibles 3,104 3,336
Goodwill 28,300 28,300
Accrued income and other assets 86,276 66,140
Total Assets $ 4,761,983 $ 4,704,740
Liabilities and Shareholders' Equity
Deposits
Non-interest bearing $ 1,318,377 $ 1,321,601
Savings and interest-bearing checking 1,972,462 1,897,487
Reciprocal 605,332 586,626
Time 306,382 308,438
Brokered time 2,945 2,938
Total Deposits 4,205,498 4,117,090
Other borrowings 30,006 30,009
Subordinated debt 39,376 39,357
Subordinated debentures 39,609 39,592
Accrued expenses and other liabilities 92,045 80,208
Total Liabilities 4,406,534 4,306,256
Commitments and contingent liabilities
Shareholders' Equity
Preferred stock, no par value, 200,000 shares authorized;
none issued or outstanding - -
Common stock, no par value, 500,000,000 shares authorized;
issued and outstanding: 21,168,230 shares at
321,981 323,401
Retained earnings 87,882 74,582
Accumulated other comprehensive income (loss) (54,414 ) 501
Total Shareholders' Equity 355,449 398,484
Total Liabilities and Shareholders' Equity $ 4,761,983 $ 4,704,740 See notes to interim condensed consolidated financial statements (Unaudited)
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