Merchants Bancorp : Investor Overview - First Quarter 2024

Investor Presentation

May 2024

Legal Disclaimer

This presentation shall not constitute an offer to sell or a solicitation of an offer to buy securities or an invitation or inducement to engage in investment activity nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification of such securities under the securities law of any such jurisdiction. Merchants Bancorp (the "Company") has filed a shelf registration statement (including a prospectus) with the Securities and Exchange Commission (the "SEC") to which this presentation relates. Before you invest in any securities of the Company, you should read the prospectus in that registration statement and any other documents the Company has filed with the SEC for more complete information about the Company and the offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, the Company, any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by contacting: Morgan Stanley & Co. LLC, Attention: Prospectus Department, 180 Varick Street, 2nd Floor, New York, NY, 10014.

This presentation may contain "forward-looking statements" within the meaning of meaning of Section 27A of the Securities Act, Section 21E of the Securities Exchange Act of

1934, as amended, and the U.S. Private Securities Litigation Reform Act of 1995. These Forward-looking statements reflect management's current view with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as "may," "might," "should," "could," "predict," "potential," "believe," "expect," "continue," "will," "will likely result," "anticipate," " seek," " estimate," intend," " plan," " projection," goal," "target," "aim." "annualized," "would" and "outlook," or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about the Company's industry, management's beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the data made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Forward-looking statements speak only as of the date they are made and are inherently subject to uncertainties and changes in circumstances, including these described under the heading "Risk Factors" in the company's latest Annual Report on Form 10-K and Quarterly Report on Form 10-Q filed with

the Securities and Exchange Commission ("SEC"), which are incorporated by reference into the prospectus supplement for this offering. Forward-looking statements are not

guarantees of future performance and should not be relied upon as representing management's views as of any subsequent date. The Company undertakes no obligation to update forward-looking statements, whether as a result of new information, future events or otherwise except as may be required by law.

Neither the SEC nor any other regulatory body has approved or disapproved of the securities of the company or passed upon the accuracy or adequacy of this presentation. Any representation to the contrary is a criminal offense. Expect as otherwise indicated, this presentation speaks as of the date hereof. The delivery of this presentation shall not, under any circumstance, create any implication there has been no change in the affairs of the Company after the date hereof.

This presentation includes industry and market data that we obtained from periodic industry publications, third-party studies and surveys. Although we believe this industry and market data is reliable as of the date of this presentation, this information could prove to be inaccurate. Industry and market data could be inaccurate because of the method by which sources obtained their data and because information cannot always be verified with complete certainty due to the limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties. In addition, we do not know all of the assumptions regarding general economic conditions or growth that were used in preparing the forecast from the sources relied upon or cited herein.

This presentation contains financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America ("GAAP"), including tangible common equity, tangible book value per share, tangible common equity to tangible assets, return on average tangible common equity (ROATCE) and efficiency ratio. Management uses these "non-GAAP" measures in its analysis of our performance. Management believes that these non-GAAP financial measures allow for better comparability with prior periods, as well as with peers in the industry who provide a similar presentation and provides a further understanding of our ongoing operations. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. A reconciliation of the non-GAAP measures used in this presentation to be most directly comparable GAAP measures is provided in the Appendix to this presentation.

2

Offering Summary

Issuer:

Ticker / Exchange:

Offering Format:

Base Offering Size:

Greenshoe:

Use of Proceeds:

Lock-up:

Bookrunner:

Expected Pricing:

• Merchants Bancorp
• MBIN / Nasdaq
• SEC Registered pursuant to S-3
• $100 million (100% primary)
• $15 million (15% of base offering size, 100% primary)
• General corporate purposes, including growth opportunities
• 90 days for the company, certain shareholders, all directors and executive officers
• Morgan Stanley
• Monday, May 13 (post-market close)

3

Today's Presenters

MICHAEL PETRIE	MICHAEL DUNLAP	JOHN MACKE
Chairman	President & CEO	Chief Financial Officer
45 years in industry	32 years in industry	32 years in industry
34 years with company	15 years with company	7 years with company

4

Overview of Merchants Bancorp (MBIN)

Overview of Merchants

Business Summary (2)

• Merchants Bancorp (MBIN) is a diversified bank holding company headquartered in Carmel, IN
• • $17.8Bn in assets as of 3/31/2024
  • $14.0Bn in deposits as of 3/31/2024
• Operates 6 bank branches located in Carmel, Indianapolis, Lynn, Spartanburg, and Richmond, Indiana
• Key business lines include:
• • Multi-familyMortgage Banking
  • Mortgage Warehouse
  • Banking
• Entrepreneurial management team with significant shareholder alignment; founding families still own ~61% of shares outstanding

Assets ($Bn)	$17.8
Headquarters	Carmel, IN
Stock Price ($)(2)	$47.44
Market Value ($MM)(2)	$2,057
Price / TBV (x) (2)	1.6x
	(2)
Price / 2024E EPS (x)	7.2x
Dividend Yield (%)(2)	0.76

Gross Loans HFI Composition (%, 1Q'24) (1)	Deposit Composition (%, 1Q'24)
Commerical &	Other	Mortgage
1%
Warehouse
Commercial Real
	11%
Estate		Brokered
15%		Residential
	Deposits
		Real Estate

	12%	41%
Healthcare		Core Deposits
23%
	59%
	Multi-family
	38%

1Q'24 Loans HFI: $10.8Bn 1Q'24 Loan Yield: 8.11%

1Q'24 Deposits: $14.0Bn

1Q'24 Cost of Deposits: 4.87%

Cost of deposits typically lower than 30-day SOFR of 5.34% as of 3/31/2024

Notes:	5
1.	Totals may not sum to 100% due to rounding
2.	Source: S&P Global; market data as of May 10, 2024; EPS estimates based on analysts' consensus estimates

Strong Financial Performance Has Driven Significant Shareholder Value

Historical Performance Since 2019

Earnings per Share

($, per Share)

6.37

5.64

4.76 4.47

3.85

1.58

Tangible Book Value per Share (3)

($, per share)

27.40

21.88

17.96

13.45

9.79

29.26

2019

2020

2021

2022

2023

LTM (1)

Total Assets

($Bn)

17.0 17.8

12.6

11.3

9.6

6.4

	2019	2020	2021	2022	2023	1Q'24
Leverage	9.4	8.6	10.4	11.7	10.1	10.5
Ratio (%) (2)

2019

2020

2021

2022

2023

1Q'24

Stock Price Performance Since IPO (4)

($)

50	+324% Gain Since IPO	$47.44
40

30
20
10
0
Oct-17	Oct-18	Oct-19	Oct-20	Oct-21	Oct-22	Oct-23May-24

Notes:	6
1. LTM refers to last twelve months

1. As defined by regulatory agencies; Tier 1 Leverage Ratio defined as the ratio of bank's core equity capital to its average total assets
2. Non-GAAPfinancial measure; refer to reconciliations of non-GAAP financial measures in the Appendix of the presentation
3. Source: S&P Global; market data as of May 10, 2024

Merchants Bancorp: Key Franchise Highlights

1 Superior Profitability & Earnings Growth Profile in Every Interest Rate Environment

2 Unique Originate-to-Sell Model with Differentiated Revenue Streams Reduces Earnings Volatility

3 Highly Efficient Cost Structure, Unique Business Model

	4	Diversified, Short Duration Loan Portfolio with Strong Organic Growth
5	Highly Disciplined Credit Culture Driving Superior Asset Quality

6 Growing Deposit Base with Multiple Sources of Funding

7 Efficient Capital Structure Coupled with Low-Risk Balance Sheet with Optimization via Securitizations

8 High-Quality Securities Portfolio with Minimal Mark-to-Market Impact

9 Significant Room for Growth and History of Delivering Industry Leading Returns

7

1 Superior Profitability & Earnings Growth Profile in Every Interest Rate Environment

Profitability Has Been Consistently Above Peers

Net Interest Margin

(%)

3.06% 3.14% 2.97%

2.79%

2.69%

2.40%

2019

2020

2021

2022

2023

1Q'24

Return on Average Assets (1)(3)

Merchants ROAA is ~2.3x

(%)	peer group's in 1Q'24

Net Income Over Time

($MM)

$311

$279

$227 $220

$181

$77

					(2)
2019	2020	2021	2022	2023	1Q'24 LTM

Return on Average Tangible Common Equity (1)(3)

(%)

Merchants ROATCE (3) is

2.12%	2.23%	2.07%	34.0%			~2.1x peer group's in 1Q'24
1.99%		30.1%
	1.85%
1.47%						22.9%	25.3%
1.34%				22.5%
1.31%
1.20%		17.6%
		16.2%	16.0%
0.88%	0.95%	0.90%	14.7%	13.5%
11.2%			12.2%

2019	2020	2021	2022	2023	1Q'24	2019	2020	2021	2022	2023	1Q'24
						MBIN		Peer Median
Notes:													8
1. Peer group source: S&P Global; Includes banks between $10-25Bn in assets that are publicly-traded on a major exchange; excludes announced merger targets. Sample includes 46 banks

1. LTM refers to last twelve months
2. Non-GAAPfinancial measure; refer to reconciliations of non-GAAP financial measures in the Appendix of the presentation

2 Unique Originate-to-Sell Model With Differentiated Revenue Streams

Business Mix Revenue Diversification Reduces Earnings Volatility Through the Full Rate Cycle

Net Revenue by Business Line (1)

($MM)

							$578	% of Total
						$523
				$430	$427		$301
							52%	Banking
			$340	$145		$287
				$195
			$98
		$165		$139	$73		$120	21%	Mortgage
		$156		$103			Warehousing
		$59
								Multi-Family
					$157		$154
		$57	$82	$143	$130	27%	Mortgage
		$43						Banking
		2019	2020	2021	2022	2023	1Q'24 LTM (2)
% Fee Based	28%	38%	37%	29%	22%	25%
Revenue

Multi-Family Mortgage Banking

• Lender to developers of multi-family residential and healthcare properties specializing in FHA, FNMA, and FHLMC Affordable permanent loan products
• Tax credit syndication
• Revenue primarily from gain on sale of loans originated, as well as servicing fees on loans sold or retained

Mortgage Warehousing

• Warehouse and commercial lender to independent mortgage banks
• Service custodial deposit relationships to match fund
• Revenue primarily from interest income and fees earned during the time that agency eligible loans are originated to mortgage bankers and are held for resale within 30 days

Banking

• Holds multi-family loans in portfolio
• Merchants Mortgage operates nationally
• Merchants SBA operates primarily in the Midwest
• Traditional community banking in Indiana
• Revenue primarily from traditional interest income and gain on sale

Notes:

1. Net revenue totals for each period include revenue from "Other" segment; not shown for illustrative purposes9

2. LTM refers to last twelve months

3 Highly Efficient Cost Structure, Unique Business Model

Industry Leading Efficiency Driven by a Branch Light Model

Non-Interest Expense / Average Assets (1)			Efficiency Ratio (1)(2)
(%)						(%)
	Since 2019 Merchants' cost structure has been			Since 2019 Merchants has been
	approximately half of peers relative to assets			~2x more efficient than peer group
2.4%										57.1%	60.5%
2.2%	2.1%		2.2%	2.2%	54.7%	54.0%	54.4%	53.3%
	2.1%
						37.4%
1.2%	1.1%	1.2%	1.2%	1.2%	1.2%		27.4%	28.8%	30.6%	31.0%	29.1%

2019	2020	2021	2022	2023	1Q'24	2019	2020	2021	2022	2023	1Q'24
						MBIN		Peer Median

Unique Business Model Leads to an Industry Leading Expense Profile

• Deep relationships with end customers driving economies-of-scale across business lines
• High concentration of variable costs and diversified business lines driving through the cycle profitability
  ‒ Low-cost structure allows for superior rates to grow core deposits
• Modernized infrastructure and efficient, technology-driven operation with significant operational capacity for growth

Notes:

1. Peer group source: S&P Global; Includes banks between $10-25Bn in assets that are publicly-traded on a major exchange; excludes announced merger targets. Sample includes 46 banks10

2. Non-GAAP financial measure; refer to reconciliations of non-GAAP financial measures in the Appendix of the presentation