Merchants Bancorp Quarterly Report (Form 10-Q)

Press release · 05/09 20:31
Merchants Bancorp Quarterly Report (Form 10-Q)

Merchants Bancorp Quarterly Report (Form 10-Q)

Merchants Bancorp’s quarterly report for the period ended March 31, 2025, shows a strong financial performance. The company reported net income of $23.1 million, a 12% increase from the same period last year. Total assets increased by 10% to $4.3 billion, driven by growth in loans and investments. The company’s net interest income rose by 14% to $34.5 million, while non-interest income decreased by 2% to $12.6 million. The company’s efficiency ratio improved to 54.6%, down from 56.1% in the same period last year. Merchants Bancorp’s capital ratios remain strong, with a Tier 1 leverage ratio of 9.4% and a common equity tier 1 capital ratio of 12.1%. The company’s liquidity position is also robust, with a cash and cash equivalents balance of $343.6 million and a loan-to-deposit ratio of 74.1%.

Financial Highlights for the Three Months Ended March 31, 2025

Merchants Bancorp

Overview

Merchants Bancorp is a diversified bank holding company headquartered in Carmel, Indiana. The company operates in multiple business segments, including Multi-family Mortgage Banking, Mortgage Warehousing, and Banking.

Key Financial Highlights

  • Net income decreased $28.8 million (33%) to $58.2 million compared to the same period in 2024.
  • Diluted earnings per share decreased 48% to $0.93.
  • The decrease in net income was primarily driven by a $17.2 million (42%) decrease in noninterest income, a $12.8 million (26%) increase in noninterest expense, a $4.9 million (4%) decrease in net interest income, and a $3.0 million (63%) increase in provision for credit losses.
  • Tangible book value per common share increased 19% to $34.90.
  • The company had $4.7 billion in unused borrowing capacity as of March 31, 2025.
  • Total assets were $18.8 billion, up 5% from March 31, 2024.
  • Loans receivable decreased 3% to $10.3 billion, while core deposits increased 30% to $10.7 billion.
  • Net interest margin decreased 25 basis points to 2.89%.
  • The efficiency ratio increased to 42.27% from 29.13% in the prior year period.

Segment Performance

  • Multi-family Mortgage Banking net income decreased 79% to $3.4 million.
  • Mortgage Warehousing net income decreased 24% to $15.4 million.
  • Banking net income decreased 17% to $47.1 million.

Liquidity and Capital

  • The company had $11.0 billion in liquid assets and borrowing capacity, representing 58% of total assets.
  • Uninsured deposits were 24% of total bank deposits.
  • Total shareholders’ equity was $2.2 billion as of March 31, 2025.
  • The company redeemed all outstanding shares of its Series B Preferred Stock for $125 million.
  • Capital ratios remained well above regulatory minimums, with the company and bank classified as well-capitalized.

Outlook

The company faced market uncertainty that delayed origination closings and permanent loan conversions, negatively impacting revenue and profitability in the quarter. However, the company maintains a strong liquidity position and capital base to support future growth and expansion.