Mackinac Financial Corporation (Nasdaq: MFNC) (“we”, or the
“Corporation”) the bank holding company for mBank (“the Bank”)
today announced 2021 first quarter net income of $3.88 million, or
$.37 per share, compared to 2020 first quarter net income of $3.05
million, or $.28 per share. Weighted average shares outstanding for
the first quarter of 2021 were 10,522,899 compared to 10,717,967
for the same period of 2020.
Total assets of the Corporation at March 31,
2021 were $1.51 billion, compared to $1.36 billion at March 31,
2020. Shareholders’ equity at March 31, 2021 totaled $170.18
million, compared to $160.06 million at March 31, 2020. Book value
per share outstanding equated to $16.13 at the end of the first
quarter 2021, compared to $14.93 per share outstanding a year ago.
Tangible book value at quarter-end was $146.40 million, or $13.88
per share outstanding, compared to $135.61 million, or $12.87 per
share outstanding at the end of the first quarter 2020.
Additional notes:
- mBank, the Corporation’s primary
asset, recorded net income of $4.26 million for the first quarter
of 2021.
- The Bank funded approximately $53
million of Paycheck Protection Program (PPP) loans in the first
quarter of 2021 with origination fees totaling approximately $2.78
million. These loans continue to support small businesses
throughout our footprint with the majority of recipients residing
in the Upper Peninsula and Northern Michigan.
- Non-interest income was very solid
for the quarter including secondary market mortgage fees and gains
on sale of $1.30 million and premiums on the sale of Small Business
Administration (SBA) guaranteed loans of $433 thousand.
- The residential mortgage pipeline
resides at robust levels and we expect strong output from this line
of business as we look to upcoming quarters.
- Core operating margin, which is net
of accretion from acquired loans and PPP fees that were subject to
purchase accounting adjustments, was 4.14%.
- On April 12, 2021 the Board of
Directors of MFNC announced the signing of a definitive agreement
for Nicolet Bankshares (Green Bay, WI) to acquire the Corporation.
The transaction is expected to close in the third quarter of 2021.
Specific information regarding the transaction can be found at
www.bankmbank.com.
Revenue & PPP
Recognition
Total revenue of the Corporation for first
quarter 2021 was $17.29 million, compared to $17.60 million for the
first quarter of 2020. Total interest income for the first three
months of 2021 was $14.89 million, compared to $15.67 million for
the same period in 2020. The 2021 first quarter interest income
included accretive yield of $237 thousand from combined credit mark
accretion associated with acquisitions, compared to $818 thousand
in the same period of 2020.
The first quarter 2021 interest income was also positively
impacted by recognition of a portion of the PPP loan origination
fees that were earned during the quarter:
- The bank originated approximately $53 million of PPP loans in
the first quarter.
- The origination efforts resulted in fees earned of $2.78
million, which are subject to FASB accounting guidance for
recognition.
- In accordance with applicable accounting guidance, the bank
recognized $826 thousand in pre-tax fee revenue that offset ASC
310-20 eligible origination costs.
- This recognition resulted in $1.95 million of fees remaining to
be accreted over the expected life of the PPP loan pool, which will
initially be 12-months unless acceleration occurs due to the loans
being paid off or forgiven before maturity.
- The amount accreted during the second quarter was $296
thousand.
- The total amount of PPP fees that were recognized in the second
quarter was $1.12 million, leaving $1.66 million to be accreted or
accelerated upon payoff.
Loan Production and Portfolio Mix
Total balance sheet loans at March 31, 2021 were
$1.06 billion, compared to March 31, 2020 balances of $1.04
billion. Total loans under management reside at $1.31 billion,
which includes $244.14 million of service retained loans. Overall
loan production for the first three months of 2021 was $133.56
million, which included $53.73 million of PPP loans. The remaining
$79.8 million was inclusive of $35.1 million of secondary market
loans, compared to total production of $66.9 million in the first
quarter 2020, which was inclusive of $19.0 million of secondary
market production.
Overall Quarterly Loan
Production is available
at https://www.globenewswire.com/NewsRoom/AttachmentNg/4f450277-ef09-4a10-8450-2f908fce2b32
Credit Quality
Nonperforming
loans totaled $5.02 million, or .47% of
total loans (.53% when excluding PPP loans) at March 31, 2021,
compared to $6.42 million, or .61% of total loans at March 31,
2020. Total loan delinquencies greater than 30 days resided
at .43% (.48% when excluding PPP loans), compared to 1.23%
in 2020. The nonperforming assets to total assets ratio
resided at .45% (.48 when excluding PPP loans) for the
first quarter of 2021, compared to .64% for the first quarter of
2020. The Corporation currently has no commercial loans in full
payment deferral and a nominal $5.3 million that remain in the
interest- only portion of their COVID-19 loan modification period.
These loans are expected to return to normal principal and interest
payments over the next quarter. There are $300 thousand of consumer
loans that remain in full payment deferral. Total loans in
some type of COVID-19 payment modification are a minimal .59% of
total loans. There remains no sign of any adverse systemic issues
or deterioration in the loan portfolio and we expect good payment
performance as we look to our stronger commerce months
ahead.
Margin Analysis, Funding and Liquidity
Net interest income for first quarter 2021 was
$13.78 million, resulting in a Net Interest Margin (NIM) of 4.52%,
compared to $13.40 million in the first quarter 2020 and a NIM of
4.60%. Core operating margin, which is net of accretion from
acquired loans that were subject to purchase accounting adjustments
(as well as PPP impact for the 2021 period), was 4.14% for the
first quarter of 2021, compared to 4.32% for the same period of
2020.
Margin Analysis Per Quarter is
available
at https://www.globenewswire.com/NewsRoom/AttachmentNg/6792bddd-857d-40a7-affe-d09627009945
Total bank deposits (excluding brokered
deposits) have increased by approximately $261 million
year-over-year from $999.09 million at March 31, 2020 to $1.26
billion at first quarter-end 2021. Total brokered deposits have
decreased significantly and were $13.35 million at March 31, 2021,
compared to $96.29 million at March 31, 2020, a decrease of 86%.
FHLB (Federal Home Loan Bank) borrowings have also decreased from
$64.12 million at March 31, 2020 to $53.46 million at March 31,
2021. The company plans to retire an additional $25 million of FHLB
borrowings in June 2021. Overall access to short-term functional
liquidity remains very strong through multiple sources, if
needed.
Noninterest Income /
Expense
First quarter 2021 Noninterest Income was $2.40
million, compared to $1.94 million for the same period of 2020. The
significant year-over-year improvement is mainly due to the
increase of secondary market mortgage sales. Noninterest Expense
for the first quarter of 2021 was $11.85 million, compared to
$11.37 million for the same period of 2020. The expense variance
was largely a result of PPP related expenses.
Assets and Capital
Total assets of the Corporation at March 31,
2021 were $1.51 billion, compared to $1.36 billion at March 31,
2020. Shareholders’ equity at March 31, 2021 totaled $170.18
million, compared to $160.06 million at March 31, 2020. Book value
per share outstanding equated to $16.13 at the end of the first
quarter 2021, compared to $14.93 per share outstanding a year ago.
Tangible book value at quarter-end was $146.40 million, or $13.88
per share outstanding, compared to $135.61 million, or $12.87 per
share outstanding at the end of the first quarter 2020.
Both the Corporation and the Bank are
“well-capitalized” with total risk-based capital to risk-weighted
assets of 15.34% and 14.62% and tier 1 capital to total tier 1
average assets at the Corporation of 9.63% and at the bank of
9.16%. The leverage ratio is calculated inclusive of PPP loan
balances.
Paul D. Tobias, Chairman and Chief Executive
Officer of the Corporation and Chairman of mBank concluded, “As we
move toward closing of the Nicolet transaction, the company
continues to work on behalf of all constituencies to make the
transition as smooth as possible while maintaining best-in-class
service to our valued clients. We know that with our experience on
the buy-side and Nicolet being an active acquirer, we have two
dedicated teams that will complete this process in the best manner
possible.”
Mackinac Financial Corporation is a registered
bank holding company formed under the Bank Holding Company Act of
1956 with assets in excess of $1.5 billion and whose common stock
is traded on the NASDAQ stock market as “MFNC.” The principal
subsidiary of the Corporation is mBank. Headquartered in
Manistique, Michigan, mBank has 28 branch locations: ten in the
Upper Peninsula, ten in the Northern Lower Peninsula, one in
Oakland County, Michigan, and seven in Northern Wisconsin. The
Corporation’s banking services include commercial lending and
treasury management products and services geared toward small to
mid-sized businesses, as well as a full array of personal and
business deposit products and consumer loans.
Forward-Looking Statements
This release contains certain
forward-looking statements. Words such as “anticipates,”
“believes,” “estimates,” “expects,” “intends,” “should,” “will,”
and variations of such words and similar expressions are intended
to identify forward-looking statements: as defined by the Private
Securities Litigation Reform Act of 1995. These statements reflect
management’s current beliefs as to expected outcomes of future
events and are not guarantees of future performance. These
statements involve certain risks, uncertainties and assumptions
that are difficult to predict with regard to timing, extent,
likelihood, and degree of occurrence. Therefore, actual results and
outcomes may materially differ from what may be expressed or
forecasted in such forward-looking statements. Factors that could
cause a difference include among others: risks that the Company’s
proposed merger with Nicolet Bankshares, Inc. (“Nicolet”) will not
be consummated due to inability to obtain shareholder or regulatory
approval or to satisfy certain closing conditions, or if
consummated, the possibility that any of the anticipated benefits
of the proposed merger will not be realized; changes in the
national and local economies or market conditions; changes in
interest rates and banking regulations; the impact of competition
from traditional or new sources; and the possibility that
anticipated cost savings and revenue enhancements from mergers and
acquisitions, bank consolidations, and other sources may not be
fully realized at all or within specified time frames as well as
other risks and uncertainties including but not limited to those
detailed from time to time in filings of the Company with the
Securities and Exchange Commission. These and other factors may
cause decisions and actual results to differ materially from
current expectations. Mackinac Financial Corporation undertakes no
obligation to revise, update, or clarify forward-looking statements
to reflect events or conditions after the date of this
release.
Important Information and Where to Find It
Certain communications in this release relate to the proposed
merger transaction involving Nicolet and Mackinac. In connection
with the proposed merger, Nicolet and Mackinac will file a joint
proxy statement/prospectus on Form S-4 and other relevant
documents concerning the merger with the Securities and Exchange
Commission (the “SEC”). BEFORE MAKING ANY VOTING OR
INVESTMENT DECISION, INVESTORS ARE URGED TO READ THE JOINT PROXY
STATEMENT/PROSPECTUS AND ANY OTHER DOCUMENTS TO BE FILED WITH THE
SEC IN CONNECTION WITH THE PROPOSED MERGER OR INCORPORATED BY
REFERENCE IN THE JOINT PROXY STATEMENT/PROSPECTUS BECAUSE THEY
WILL CONTAIN IMPORTANT INFORMATION ABOUT NICOLET, MACKINAC AND THE
PROPOSED MERGER. When available, the joint proxy
statement/prospectus will be delivered to
shareholders of Nicolet and Mackinac. Investors may obtain copies
of the joint proxy statement/prospectus and other relevant
documents (as they become available) free of charge at the SEC’s
website (www.sec.gov). Copies of the documents filed with the
SEC by Nicolet will be available free of charge on Nicolet’s
website at www.nicoletbank.com. Copies of the documents filed
with the SEC by Mackinac will be available free of charge on
Mackinac’s website at www.bankmbank.com.
Nicolet, Mackinac and certain of their directors, executive
officers and other members of management and employees may be
deemed to be participants in the solicitation of proxies from the
shareholders of Nicolet and the shareholders of Mackinac in
connection with the proposed merger. Information about the
directors and executive officers of Nicolet and Mackinac will be
included in the joint proxy statement/prospectus
for the proposed transaction filed with the SEC. Information about
the directors and executive officers of Nicolet is also included in
the proxy statement for its 2021 annual meeting of shareholders,
which was filed with the SEC on March 2, 2021. Information about
the directors and executive officers of Mackinac is also included
in the proxy statement for its 2021 annual meeting of shareholders,
which was filed with the SEC on April 22, 2021. Additional
information regarding the interests of such participants and other
persons who may be deemed participants in the transaction will be
included in the joint proxy statement/prospectus and the other
relevant documents filed with the SEC when they become
available.
MACKINAC FINANCIAL CORPORATION AND
SUBSIDIARIESSELECTED FINANCIAL
HIGHLIGHTS
|
|
|
|
|
|
As of and
For the |
|
As of and For
the |
|
As of and For
the |
|
|
|
|
|
|
|
Period
Ending |
|
Year Ending |
|
Period Ending |
|
|
|
|
|
|
|
March
31, |
|
December 31, |
|
March 31, |
|
(Dollars in thousands, except per share data) |
|
2021 |
|
2020 |
|
2020 |
|
|
|
|
|
|
|
(Unaudited) |
|
|
|
(Unaudited) |
|
Selected Financial Condition Data (at end
of period): |
|
|
|
|
|
|
Assets |
|
|
|
|
|
$ |
1,508,248 |
|
$ |
1,501,730 |
|
$ |
1,356,381 |
|
Loans |
|
|
|
|
|
|
1,063,756 |
|
|
1,077,592 |
|
|
1,044,177 |
|
Investment securities |
|
|
|
|
109,414 |
|
|
111,836 |
|
|
114,734 |
|
Deposits |
|
|
|
|
|
|
1,273,279 |
|
|
1,258,776 |
|
|
1,095,381 |
|
Borrowings |
|
|
|
|
|
53,459 |
|
|
63,479 |
|
|
67,120 |
|
Shareholders’ equity |
|
|
|
|
170,176 |
|
|
167,864 |
|
|
160,060 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Statements of Income Data (three months and year
ended) |
|
|
|
|
|
Net interest income |
|
|
|
|
$ |
13,778 |
|
$ |
54,806 |
|
$ |
13,397 |
|
Income before taxes |
|
|
|
|
4,278 |
|
|
17,056 |
|
|
3,862 |
|
Net income |
|
|
|
|
|
3,880 |
|
|
13,473 |
|
|
3,051 |
|
Income per common share - Basic |
|
|
|
0.37 |
|
|
1.27 |
|
|
0.28 |
|
Income per common share - Diluted |
|
|
|
0.37 |
|
|
1.27 |
|
|
0.28 |
|
Weighted average shares outstanding - Basic |
|
|
10,522,899 |
|
|
10,580,044 |
|
|
10,717,967 |
|
Weighted average shares outstanding- Diluted |
|
|
10,522,899 |
|
|
10,580,044 |
|
|
10,817,470 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Financial Ratios and Other Data: |
|
|
|
|
|
|
|
Performance Ratios: |
|
|
|
|
|
|
|
|
|
Net interest margin |
|
|
|
|
|
4.52 |
% |
|
4.37 |
% |
|
4.60 |
% |
Efficiency ratio |
|
|
|
|
|
73.19 |
|
|
71.84 |
|
|
73.78 |
|
Return on average assets |
|
|
|
|
1.04 |
|
|
0.92 |
|
|
0.93 |
|
Return on average equity |
|
|
|
|
9.31 |
|
|
8.19 |
|
|
7.54 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Average total assets |
|
|
|
|
$ |
1,512,496 |
|
$ |
1,464,674 |
|
$ |
1,321,134 |
|
Average total shareholders’ equity |
|
|
|
169,023 |
|
|
164,505 |
|
|
162,661 |
|
Average loans to average deposits ratio |
|
|
|
84.26 |
% |
|
93.34 |
% |
|
97.30 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Common Share Data at end of period: |
|
|
|
|
|
|
|
|
Market price per common share |
|
|
$ |
14.02 |
|
$ |
12.76 |
|
$ |
10.45 |
|
Book value per common share |
|
|
|
16.13 |
|
|
15.99 |
|
|
15.20 |
|
Tangible book value per share |
|
|
|
13.88 |
|
|
13.71 |
|
|
12.87 |
|
Dividends paid per share, annualized |
|
|
|
0.56 |
|
|
0.56 |
|
|
0.56 |
|
Common shares outstanding |
|
|
|
|
10,550,393 |
|
|
10,500,758 |
|
|
10,533,589 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Data at end of period: |
|
|
|
|
|
|
|
|
|
Allowance for loan losses |
|
|
|
$ |
5,842 |
|
$ |
5,816 |
|
$ |
5,292 |
|
Non-performing assets |
|
|
|
|
6,716 |
|
|
7,210 |
|
|
8,644 |
|
Allowance for loan losses to total loans |
|
|
|
0.55 |
% |
|
0.54 |
% |
|
0.51 |
% |
Non-performing assets to total assets |
|
|
|
0.45 |
% |
|
0.48 |
% |
|
0.64 |
% |
Texas ratio |
|
|
|
|
|
4.41 |
% |
|
4.82 |
% |
|
6.13 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Number of: |
|
|
|
|
|
|
|
|
|
|
Branch locations |
|
|
|
|
|
28 |
|
|
28 |
|
|
29 |
|
FTE Employees |
|
|
|
|
|
310 |
|
|
315 |
|
|
316 |
|
MACKINAC FINANCIAL CORPORATION AND
SUBSIDIARIESCONSOLIDATED BALANCE
SHEETS
|
|
March
31, |
|
December
31, |
|
March
31, |
|
|
2021 |
|
2020 |
|
2020 |
|
|
(Unaudited) |
|
|
|
|
(Unaudited) |
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and due from banks |
|
$ |
239,831 |
|
|
$ |
218,901 |
|
|
$ |
97,041 |
|
Federal
funds sold |
|
|
3,661 |
|
|
|
76 |
|
|
|
31 |
|
Cash and cash equivalents |
|
|
243,492 |
|
|
|
218,977 |
|
|
|
97,072 |
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing deposits in other financial institutions |
|
|
2,427 |
|
|
|
2,917 |
|
|
|
8,825 |
|
Securities
available for sale |
|
|
109,414 |
|
|
|
111,836 |
|
|
|
114,734 |
|
Federal Home
Loan Bank stock |
|
|
4,924 |
|
|
|
4,924 |
|
|
|
4,924 |
|
|
|
|
|
|
|
|
|
|
|
Loans: |
|
|
|
|
|
|
|
|
|
Commercial |
|
|
818,584 |
|
|
|
819,907 |
|
|
|
760,357 |
|
Mortgage |
|
|
226,780 |
|
|
|
238,705 |
|
|
|
263,445 |
|
Consumer |
|
|
18,392 |
|
|
|
18,980 |
|
|
|
20,375 |
|
Total Loans |
|
|
1,063,756 |
|
|
|
1,077,592 |
|
|
|
1,044,177 |
|
Allowance for loan losses |
|
|
(5,842 |
) |
|
|
(5,816 |
) |
|
|
(5,292 |
) |
Net loans |
|
|
1,057,914 |
|
|
|
1,071,776 |
|
|
|
1,038,885 |
|
|
|
|
|
|
|
|
|
|
|
Premises and
equipment |
|
|
25,010 |
|
|
|
25,518 |
|
|
|
24,522 |
|
Other real
estate held for sale |
|
|
1,692 |
|
|
|
1,752 |
|
|
|
2,228 |
|
Deferred tax
asset |
|
|
2,492 |
|
|
|
3,303 |
|
|
|
3,154 |
|
Deposit
based intangibles |
|
|
4,200 |
|
|
|
4,368 |
|
|
|
4,874 |
|
Goodwill |
|
|
19,574 |
|
|
|
19,574 |
|
|
|
19,574 |
|
Other
assets |
|
|
37,109 |
|
|
|
36,785 |
|
|
|
37,589 |
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS |
|
$ |
1,508,248 |
|
|
$ |
1,501,730 |
|
|
$ |
1,356,381 |
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES: |
|
|
|
|
|
|
|
|
|
Deposits: |
|
|
|
|
|
|
|
|
|
Noninterest bearing deposits |
|
$ |
443,956 |
|
|
$ |
414,804 |
|
|
$ |
278,191 |
|
NOW, money market, interest checking |
|
|
478,181 |
|
|
|
450,556 |
|
|
|
369,003 |
|
Savings |
|
|
137,134 |
|
|
|
130,755 |
|
|
|
109,818 |
|
CDs<$250,000 |
|
|
190,320 |
|
|
|
202,266 |
|
|
|
227,924 |
|
CDs>$250,000 |
|
|
10,337 |
|
|
|
15,224 |
|
|
|
14,152 |
|
Brokered |
|
|
13,351 |
|
|
|
45,171 |
|
|
|
96,293 |
|
Total deposits |
|
|
1,273,279 |
|
|
|
1,258,776 |
|
|
|
1,095,381 |
|
|
|
|
|
|
|
|
|
|
|
Federal funds purchased |
|
|
|
|
|
|
|
|
22,790 |
|
Borrowings |
|
|
53,459 |
|
|
|
63,479 |
|
|
|
67,120 |
|
Other liabilities |
|
|
11,334 |
|
|
|
11,611 |
|
|
|
11,030 |
|
Total liabilities |
|
|
1,338,072 |
|
|
|
1,333,866 |
|
|
|
1,196,321 |
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS’ EQUITY: |
|
|
|
|
|
|
|
|
|
Common stock and additional paid in capital - No par value
Authorized - 18,000,000 shares Issued and outstanding -
10,550,393; 10,500,758 and 10,533,589
respectively |
|
|
127,397 |
|
|
|
127,164 |
|
|
|
127,003 |
|
Retained earnings |
|
|
41,721 |
|
|
|
39,318 |
|
|
|
33,316 |
|
Accumulated other comprehensive income (loss) |
|
|
|
|
|
|
|
|
|
Unrealized (losses) gains on available for sale securities |
|
|
1,641 |
|
|
|
1,965 |
|
|
|
151 |
|
Minimum pension liability |
|
|
(583 |
) |
|
|
(583 |
) |
|
|
(410 |
) |
Total shareholders’ equity |
|
|
170,176 |
|
|
|
167,864 |
|
|
|
160,060 |
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
$ |
1,508,248 |
|
|
$ |
1,501,730 |
|
|
$ |
1,356,381 |
|
MACKINAC FINANCIAL CORPORATION AND
SUBSIDIARIESCONSOLIDATED STATEMENTS OF
OPERATIONS
|
|
For the
Three Months Ended |
|
|
|
March 31, |
|
|
|
|
2021 |
|
|
|
2020 |
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
INTEREST INCOME: |
|
|
|
|
|
Interest and fees on loans: |
|
|
|
|
|
Taxable |
|
$ |
14,122 |
|
|
$ |
14,613 |
|
Tax-exempt |
|
|
20 |
|
|
|
74 |
|
Interest on securities: |
|
|
|
|
|
Taxable |
|
|
524 |
|
|
|
621 |
|
Tax-exempt |
|
|
142 |
|
|
|
87 |
|
Other interest income |
|
|
84 |
|
|
|
270 |
|
Total interest income |
|
|
14,892 |
|
|
|
15,665 |
|
|
|
|
|
|
|
INTEREST EXPENSE: |
|
|
|
|
|
Deposits |
|
|
889 |
|
|
|
1,927 |
|
Borrowings |
|
|
225 |
|
|
|
341 |
|
Total interest expense |
|
|
1,114 |
|
|
|
2,268 |
|
|
|
|
|
|
|
Net interest
income |
|
|
13,778 |
|
|
|
13,397 |
|
Provision
for loan losses |
|
|
50 |
|
|
|
100 |
|
Net interest
income after provision for loan losses |
|
|
13,728 |
|
|
|
13,297 |
|
|
|
|
|
|
|
OTHER INCOME: |
|
|
|
|
|
Deposit service fees |
|
|
257 |
|
|
|
403 |
|
Income from loans sold on the secondary market |
|
|
1,302 |
|
|
|
538 |
|
SBA/USDA loan sale gains |
|
|
433 |
|
|
|
710 |
|
Mortgage servicing amortization |
|
|
241 |
|
|
|
189 |
|
Net security gains |
|
|
36 |
|
|
|
- |
|
Other |
|
|
129 |
|
|
|
97 |
|
Total other income |
|
|
2,398 |
|
|
|
1,937 |
|
|
|
|
|
|
|
OTHER EXPENSE: |
|
|
|
|
|
Salaries and employee benefits |
|
|
6,824 |
|
|
|
6,051 |
|
Occupancy |
|
|
1,183 |
|
|
|
1,124 |
|
Furniture and equipment |
|
|
842 |
|
|
|
802 |
|
Data processing |
|
|
770 |
|
|
|
825 |
|
Advertising |
|
|
113 |
|
|
|
212 |
|
Professional service fees |
|
|
498 |
|
|
|
498 |
|
Loan origination expenses and deposit and card related fees |
|
|
450 |
|
|
|
381 |
|
Writedowns and losses on other real estate held for sale |
|
|
(52 |
) |
|
|
3 |
|
FDIC insurance assessment |
|
|
140 |
|
|
|
150 |
|
Communications expense |
|
|
241 |
|
|
|
213 |
|
Other |
|
|
839 |
|
|
|
1,113 |
|
Total other expenses |
|
|
11,848 |
|
|
|
11,372 |
|
|
|
|
|
|
|
Income
before provision for income taxes |
|
|
4,278 |
|
|
|
3,862 |
|
Provision
for income taxes |
|
|
398 |
|
|
|
811 |
|
|
|
|
|
|
|
NET
INCOME AVAILABLE TO COMMON SHAREHOLDERS |
|
$ |
3,880 |
|
|
$ |
3,051 |
|
|
|
|
|
|
|
INCOME PER COMMON SHARE: |
|
|
|
|
|
Basic |
|
$ |
0.37 |
|
|
$ |
0.28 |
|
Diluted |
|
$ |
0.37 |
|
|
$ |
0.28 |
|
MACKINAC FINANCIAL CORPORATION AND
SUBSIDIARIESLOAN PORTFOLIO AND CREDIT
QUALITY
(Dollars in thousands)
Loan Portfolio Balances (at end of period):
|
March
31, |
|
December 31, |
|
March 31, |
|
|
2021 |
|
2020 |
|
2020 |
|
|
(Unaudited) |
|
(Audited) |
|
(Unaudited) |
|
Commercial Loans: |
|
|
|
|
|
|
Real estate - operators of nonresidential buildings |
$ |
137,356 |
|
$ |
138,992 |
|
$ |
136,477 |
|
Hospitality
and tourism |
|
105,077 |
|
|
100,237 |
|
|
94,734 |
|
Lessors of
residential buildings |
|
51,288 |
|
|
52,035 |
|
|
48,529 |
|
Gasoline
stations and convenience stores |
|
27,562 |
|
|
29,046 |
|
|
26,495 |
|
Logging |
|
16,756 |
|
|
18,651 |
|
|
21,380 |
|
Commercial
construction |
|
49,240 |
|
|
47,698 |
|
|
29,971 |
|
Other |
|
431,305 |
|
|
433,248 |
|
|
402,771 |
|
Total Commercial Loans |
|
818,584 |
|
|
819,907 |
|
|
760,357 |
|
|
|
|
|
|
|
|
1-4 family
residential real estate |
|
214,034 |
|
|
227,044 |
|
|
244,059 |
|
Consumer |
|
18,392 |
|
|
18,980 |
|
|
20,375 |
|
Consumer
construction |
|
12,746 |
|
|
11,661 |
|
|
19,386 |
|
|
|
|
|
|
|
|
Total Loans |
$ |
1,063,756 |
|
$ |
1,077,592 |
|
$ |
1,044,177 |
|
|
|
|
|
|
|
|
Credit Quality (at end of period):
|
March
31, |
|
December 31, |
|
March 31, |
|
|
2021 |
|
2020 |
|
2020 |
|
|
(Unaudited) |
|
(Audited) |
|
(Unaudited) |
|
Nonperforming Assets : |
|
|
|
|
|
|
Nonaccrual loans |
$ |
5,024 |
|
$ |
5,458 |
|
$ |
6,416 |
|
Loans past
due 90 days or more |
|
- |
|
|
- |
|
|
- |
|
Restructured
loans |
|
- |
|
|
- |
|
|
- |
|
Total nonperforming loans |
|
5,024 |
|
|
5,458 |
|
|
6,416 |
|
Other real
estate owned |
|
1,692 |
|
|
1,752 |
|
|
2,228 |
|
Total nonperforming assets |
$ |
6,716 |
|
$ |
7,210 |
|
$ |
8,644 |
|
Nonperforming loans as a % of loans |
|
0.47 |
% |
|
0.51 |
% |
|
0.61 |
% |
Nonperforming assets as a % of assets |
|
0.45 |
% |
|
0.48 |
% |
|
0.64 |
% |
Reserve for Loan Losses: |
|
|
|
|
|
|
At period
end |
$ |
5,842 |
|
$ |
5,816 |
|
$ |
5,292 |
|
As a % of
outstanding loans |
|
0.55 |
% |
|
0.54 |
% |
|
0.51 |
% |
As a % of
nonperforming loans |
|
116.28 |
% |
|
106.56 |
% |
|
82.48 |
% |
As a % of
nonaccrual loans |
|
116.28 |
% |
|
106.56 |
% |
|
82.48 |
% |
Texas
Ratio |
|
4.41 |
% |
|
4.82 |
% |
|
6.13 |
% |
|
|
|
|
|
|
|
Charge-off Information (year to date): |
|
|
|
|
|
Average
loans |
$ |
1,078,022 |
|
$ |
1,117,132 |
|
$ |
1,047,144 |
|
Net
charge-offs (recoveries) |
$ |
24 |
|
$ |
492 |
|
$ |
116 |
|
Charge-offs
as a % of average |
|
|
|
|
|
|
loans, annualized |
|
0.01 |
% |
|
0.04 |
% |
|
0.04 |
% |
MACKINAC FINANCIAL CORPORATION AND
SUBSIDIARIES QUARTERLY FINANCIAL HIGHLIGHTS
|
|
|
|
|
|
|
|
|
|
|
QUARTER ENDED |
|
(Unaudited) |
|
March 31, |
|
December 31, |
|
September 30, |
|
June, 30 |
|
March 31, |
|
|
2021 |
|
|
|
2020 |
|
|
|
2020 |
|
|
|
2020 |
|
|
|
2020 |
|
BALANCE SHEET (Dollars in
thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
loans |
$ |
1,063,756 |
|
|
$ |
1,077,592 |
|
|
$ |
1,144,325 |
|
|
$ |
1,153,790 |
|
|
$ |
1,044,177 |
|
Allowance
for loan losses |
|
(5,842 |
) |
|
|
(5,816 |
) |
|
|
(5,832 |
) |
|
|
(5,355 |
) |
|
|
(5,292 |
) |
Total loans, net |
|
1,057,914 |
|
|
|
1,071,776 |
|
|
|
1,138,493 |
|
|
|
1,148,435 |
|
|
|
1,038,885 |
|
Total
assets |
|
1,508,248 |
|
|
|
1,501,730 |
|
|
|
1,522,917 |
|
|
|
1,518,473 |
|
|
|
1,356,381 |
|
Core
deposits |
|
1,249,591 |
|
|
|
1,198,381 |
|
|
|
1,195,062 |
|
|
|
1,122,582 |
|
|
|
984,936 |
|
Noncore
deposits |
|
23,688 |
|
|
|
60,395 |
|
|
|
85,825 |
|
|
|
104,970 |
|
|
|
110,445 |
|
Total deposits |
|
1,273,279 |
|
|
|
1,258,776 |
|
|
|
1,280,887 |
|
|
|
1,227,552 |
|
|
|
1,095,381 |
|
Total
borrowings |
|
53,459 |
|
|
|
63,479 |
|
|
|
63,505 |
|
|
|
114,466 |
|
|
|
67,120 |
|
Total
shareholders' equity |
|
170,176 |
|
|
|
167,864 |
|
|
|
166,168 |
|
|
|
164,157 |
|
|
|
160,060 |
|
Total
tangible equity |
|
146,402 |
|
|
|
143,922 |
|
|
|
142,057 |
|
|
|
139,877 |
|
|
|
135,612 |
|
Total shares
outstanding |
|
10,550,393 |
|
|
|
10,500,758 |
|
|
|
10,533,589 |
|
|
|
10,533,589 |
|
|
|
10,533,589 |
|
Weighted
average shares outstanding |
|
10,522,899 |
|
|
|
10,536,023 |
|
|
|
10,533,589 |
|
|
|
10,533,589 |
|
|
|
10,717,967 |
|
|
|
|
|
|
|
|
|
|
|
AVERAGE BALANCES (Dollars in
thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets |
$ |
1,512,496 |
|
|
$ |
1,505,869 |
|
|
$ |
1,536,128 |
|
|
$ |
1,501,423 |
|
|
$ |
1,321,134 |
|
Earning
assets |
|
1,235,235 |
|
|
|
1,252,038 |
|
|
|
1,303,102 |
|
|
|
1,290,012 |
|
|
|
1,171,551 |
|
Loans |
|
1,078,022 |
|
|
|
1,118,665 |
|
|
|
1,154,670 |
|
|
|
1,147,620 |
|
|
|
1,047,144 |
|
Noninterest
bearing deposits |
|
426,890 |
|
|
|
422,081 |
|
|
|
422,134 |
|
|
|
346,180 |
|
|
|
284,677 |
|
Deposits |
|
1,279,362 |
|
|
|
1,255,669 |
|
|
|
1,269,658 |
|
|
|
1,211,694 |
|
|
|
1,076,206 |
|
Equity |
|
169,023 |
|
|
|
167,459 |
|
|
|
165,450 |
|
|
|
161,811 |
|
|
|
162,661 |
|
|
|
|
|
|
|
|
|
|
|
INCOME STATEMENT (Dollars in
thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income |
$ |
13,778 |
|
|
$ |
13,898 |
|
|
$ |
13,052 |
|
|
$ |
14,458 |
|
|
$ |
13,397 |
|
Provision
for loan losses |
|
50 |
|
|
|
400 |
|
|
|
400 |
|
|
|
100 |
|
|
|
100 |
|
Net interest income after provision |
|
13,728 |
|
|
|
13,498 |
|
|
|
12,652 |
|
|
|
14,358 |
|
|
|
13,297 |
|
Total
noninterest income |
|
2,398 |
|
|
|
2,779 |
|
|
|
3,116 |
|
|
|
2,367 |
|
|
|
1,937 |
|
Total
noninterest expense |
|
11,848 |
|
|
|
11,663 |
|
|
|
11,561 |
|
|
|
12,352 |
|
|
|
11,372 |
|
Income
before taxes |
|
4,278 |
|
|
|
4,614 |
|
|
|
4,207 |
|
|
|
4,373 |
|
|
|
3,862 |
|
Provision
for income taxes |
|
398 |
|
|
|
970 |
|
|
|
883 |
|
|
|
919 |
|
|
|
811 |
|
Net income
available to common shareholders |
$ |
3,880 |
|
|
$ |
3,644 |
|
|
$ |
3,324 |
|
|
$ |
3,454 |
|
|
$ |
3,051 |
|
Income pre-tax, pre-provision |
$ |
4,328 |
|
|
$ |
5,014 |
|
|
$ |
4,607 |
|
|
$ |
4,473 |
|
|
$ |
3,962 |
|
|
|
|
|
|
|
|
|
|
|
PER
SHARE DATA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
common share |
$ |
0.37 |
|
|
$ |
0.35 |
|
|
$ |
0.32 |
|
|
$ |
0.33 |
|
|
$ |
0.28 |
|
Book value
per common share |
|
16.13 |
|
|
|
15.99 |
|
|
|
15.78 |
|
|
|
15.58 |
|
|
|
15.20 |
|
Tangible
book value per share |
|
13.88 |
|
|
|
13.71 |
|
|
|
13.49 |
|
|
|
13.28 |
|
|
|
12.87 |
|
Market
value, closing price |
|
14.02 |
|
|
|
12.76 |
|
|
|
9.65 |
|
|
|
10.37 |
|
|
|
10.45 |
|
Dividends
per share |
|
0.14 |
|
|
|
0.14 |
|
|
|
0.14 |
|
|
|
0.14 |
|
|
|
0.14 |
|
|
|
|
|
|
|
|
|
|
|
ASSET QUALITY RATIOS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonperforming loans/total loans |
|
0.47 |
% |
|
|
0.51 |
% |
|
|
0.47 |
% |
|
|
0.53 |
% |
|
|
0.61 |
% |
Nonperforming assets/total assets |
|
0.45 |
|
|
|
0.48 |
|
|
|
0.48 |
|
|
|
0.55 |
|
|
|
0.64 |
|
Allowance
for loan losses/total loans |
|
0.55 |
|
|
|
0.54 |
|
|
|
0.51 |
|
|
|
0.46 |
|
|
|
0.51 |
|
Allowance
for loan losses/nonperforming loans |
|
116.28 |
|
|
|
106.56 |
|
|
|
107.72 |
|
|
|
87.44 |
|
|
|
82.48 |
|
Texas
ratio |
|
4.41 |
|
|
|
4.82 |
|
|
|
4.91 |
|
|
|
4.22 |
|
|
|
6.13 |
|
|
|
|
|
|
|
|
|
|
|
PROFITABILITY RATIOS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on
average assets |
|
1.04 |
% |
|
|
0.96 |
% |
|
|
0.86 |
% |
|
|
0.93 |
% |
|
|
0.93 |
% |
Return on
average equity |
|
9.31 |
|
|
|
8.66 |
|
|
|
7.99 |
|
|
|
8.58 |
|
|
|
7.54 |
|
Net interest
margin |
|
4.52 |
|
|
|
4.42 |
|
|
|
3.98 |
|
|
|
4.51 |
|
|
|
4.60 |
|
Average
loans/average deposits |
|
84.26 |
|
|
|
89.09 |
|
|
|
90.94 |
|
|
|
94.71 |
|
|
|
97.30 |
|
|
|
|
|
|
|
|
|
|
|
CAPITAL ADEQUACY RATIOS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tier 1
leverage ratio |
|
9.63 |
% |
|
|
9.63 |
% |
|
|
9.20 |
% |
|
|
9.45 |
% |
|
|
10.20 |
% |
Tier 1
capital to risk weighted assets |
|
14.74 |
|
|
|
14.48 |
|
|
|
13.91 |
|
|
|
13.27 |
|
|
|
12.89 |
|
Total
capital to risk weighted assets |
|
15.34 |
|
|
|
15.07 |
|
|
|
14.49 |
|
|
|
13.79 |
|
|
|
13.41 |
|
Average
equity/average assets (for the quarter) |
|
11.18 |
|
|
|
11.12 |
|
|
|
10.77 |
|
|
|
10.78 |
|
|
|
12.31 |
|
Contact: Jesse A.
Deering, EVP & Chief Financial Officer (248) 290-5906
/jdeering@bankmbank.comWebsite: www.bankmbank.com
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