Independent Bank Corporation Reports 2025 Second Quarter Results

Rhea-AI Summary

Independent Bank Corporation (NASDAQ: IBCP) reported Q2 2025 net income of $16.9 million, or $0.81 per diluted share, compared to $18.5 million, or $0.88 per share, in Q2 2024. The bank demonstrated strong performance with 9.0% annualized loan growth and a net interest margin expansion of 9 basis points compared to Q1 2025.

Key financial metrics include a return on average assets of 1.27% and return on average equity of 14.66%. The bank maintained strong credit quality with non-performing assets at 0.16% of total assets and net charge-offs of 0.02%. Total assets reached $5.42 billion, with deposits of $4.66 billion and a robust capital position with tangible common equity at $439.7 million.

Positive

• Net interest income increased by $3.3 million (7.9%) year-over-year
• Loan portfolio grew by 9.0% annualized from Q1 2025
• Net interest margin expanded by 9 basis points to 3.58%
• Strong capital ratios with Total capital to risk-weighted assets at 13.15%
• Tangible common equity per share increased by 6.9% annualized from Q1 2025

Negative

• Net income decreased to $16.9 million from $18.5 million year-over-year
• Core deposits declined by 1.4% annualized due to seasonality
• Non-performing loans increased to $8.2 million from $6.0 million in December 2024
• Provision for credit losses increased to $1.50 million from $0.02 million year-over-year

Insights

Financial Analyst

IBCP posted solid Q2 results with loan growth, margin expansion, and healthy profitability despite some headwinds in mortgage servicing.

Independent Bank Corporation delivered $16.9 million in net income ($0.81 per share) in Q2 2025, representing a return on assets of 1.27% and return on equity of 14.66%. While these figures are below the $18.5 million ($0.88 per share) from Q2 2024, the year-over-year comparison is skewed by a one-time $2.7 million gain from Visa stock exchange in the prior year period.

The bank demonstrated impressive 9.0% annualized loan growth in Q2, increasing its loan portfolio to $4.16 billion. This growth was paired with a healthy 9 basis point expansion in net interest margin to 3.58%, driving net interest income up by 7.9% year-over-year to $44.6 million. The margin expansion is particularly noteworthy as it indicates the bank is successfully managing its funding costs while optimizing asset yields.

Credit quality metrics remain strong despite a slight uptick in non-performing loans, which increased to 0.20% of total portfolio loans compared to 0.15% at year-end 2024. The allowance for credit losses stands at 1.47% of total loans, providing substantial coverage at 745% of non-performing loans. Net charge-offs were minimal at just 0.02% of average loans (annualized).

Capital ratios remain robust with CET1 at 11.90% and total capital at 13.15%, well above regulatory requirements. Tangible book value per share increased by $0.90 from year-end to $21.23, representing 10.8% annualized growth versus Q2 2024.

The bank's strategic decision to sell approximately $931 million of mortgage servicing rights in January 2025 reduced servicing revenue but was intended to decrease interest rate sensitivity. This contributed to the decline in non-interest income, which fell to $11.3 million from $15.2 million in Q2 2024.

Overall, IBCP demonstrates solid fundamental performance with controlled expenses, healthy loan growth, and improving net interest margin despite the competitive deposit environment. The bank maintains substantial liquidity with $1.02 billion in unused FHLB credit lines and $484.6 million from the Federal Reserve, positioning it well for continued growth.

Second Quarter Highlights

Highlights for the second quarter of 2025 include:

• Increase in net interest income of $0.9 million (or 2.1% ) over the first quarter of 2025;
• Increase in tangible common equity per share of common stock of $0.36 (or 6.9% annualized) from March 31, 2025;
• Net interest margin expansion of nine basis points compared to March 31, 2025;
• Net growth in loans of $91.7 million (or 9.0% annualized) from March 31, 2025; and
• The payment of a 26 cent per share dividend on common stock on May 15, 2025.
  
  

GRAND RAPIDS, Mich., July 24, 2025 (GLOBE NEWSWIRE) -- Independent Bank Corporation (NASDAQ: IBCP) reported second quarter 2025 net income of $16.9 million, or $0.81 per diluted share, versus net income of $18.5 million, or $0.88 per diluted share, in the prior-year period.

William B. (“Brad”) Kessel, the President and Chief Executive Officer of Independent Bank Corporation, commented: "I am proud of our team and pleased to see us continue our positive trends with our second quarter 2025 results. Overall, loans increased by 9.0% (annualized), while core deposits were down by 1.4% (annualized) due to seasonality. We generated net interest income growth on both a linked quarter basis and a year-over-year quarterly basis, producing nine basis points of margin expansion from the prior quarter. We believe our expenses are well managed, and we continue to see improved operational scale from strategic investments made in recent years. These fundamentals drove positive growth in tangible common equity per share of common stock (10.8%) compared to the prior year quarter, along with very healthy performance returns: a return on average assets of 1.27% and a return on average equity of 14.66%. Despite heightened uncertainty in the markets during the quarter, our credit metrics remain strong, with low levels of watch credits, 16 basis points of non-performing assets to total assets, and 0.02% net charge-offs to average loans of the quarter (annualized). The allowance for credit losses was 1.47% of total loans. Our team has been effective in many areas during the first half of 2025, including business development from the existing customer base and onboarding new relationships which have enhanced the geographic and product line diversification of our business. We continue to succeed in recruiting talented bankers to join the Independent Bank team. During the second quarter, we rolled out several new technologies to make banking easier for both our customers and associates serving our customers. For all these reasons, I am optimistic about our prospects for growth in the balance of 2025 and 2026."

Significant items impacting comparable second quarter 2025 and 2024 results include the following:

• Changes in the fair value due to price of capitalized mortgage loan servicing rights (the “MSR Changes”) of $(0.2) million ($(0.01) per diluted share, after taxes) for the three-month period ended June 30, 2025, as compared to $0.9 million ($0.03 per diluted share, after taxes) for the three-month period ended June 30, 2024.
  
  
• Gain on equity securities at fair value of $2.7 million ($0.10 per diluted share, after tax) in the second quarter ended June 30, 2024, attributable to the exchange of our Visa Class B-1 common stock. No gain or loss on equity securities at fair value was recorded for the second quarter of 2025.
  
  

Operating Results

The Company’s net interest income totaled $44.6 million during the second quarter of 2025, an increase of $3.3 million, or 7.9% from the year-ago period, and an increase of $0.9 million, or 2.1%, from the first quarter of 2025. The Company’s tax equivalent net interest income as a percent of average interest-earning assets (the “net interest margin”) was 3.58% during the second quarter of 2025, compared to 3.40% in the year-ago period, and 3.49% in the first quarter of 2025. The year-over-year quarterly increase in net interest income was due to both an increase in average interest-earning assets and the higher net interest margin. The linked quarter increase in net interest income was due to an increase in the net interest margin that was partially offset by a decrease in average interest-earning assets. Average interest-earning assets were $5.04 billion in the second quarter of 2025, compared to $4.89 billion in the year ago quarter and $5.08 billion in the first quarter of 2025.

Non-interest income totaled $11.3 million for the second quarter of 2025, compared to $15.2 million in the comparable prior year period. This change was primarily due to a gain on equity securities at fair value of $2.7 million in the prior year quarter as well as variances in mortgage banking related revenues.

Net gains on mortgage loans in the second quarters of 2025 and 2024 were approximately $1.6 million and $1.3 million, respectively. The comparative quarterly increase in net gains on mortgage loans was due to an increase in both gain on sale margin on mortgage loans sold and an increase in the volume of mortgage loans sold.

Mortgage loan servicing, net, generated income of $0.5 million and $2.1 million in the second quarters of 2025 and 2024, respectively. The significant variance in mortgage loan servicing, net is primarily due to changes in the fair value of capitalized mortgage loan servicing rights associated with changes in interest rates and the associated expected future prepayment levels and expected float rates as well as a decline in servicing revenue. The decline in servicing revenue is attributed to the sale of approximately $931 million of mortgage servicing rights on January 31, 2025. Capitalized mortgage loan servicing rights totaled $32.1 million and $46.8 million at June 30, 2025 and December 31, 2024, respectively. The decline during the first half of 2025 was primarily attributed to the aforementioned mortgage servicing right sale. This transaction was executed in part to reduce the amount of exposure the bank had to rate variances that may impact the mortgage servicing right asset valuation in future periods. While the magnitude of fair value adjustments would also be expected to decrease, those adjustments are dependent upon factors that are harder to predict.

Mortgage loan servicing, net activity is summarized in the following table:

	Three months ended								Six months ended
	6/30/2025				6/30/2024				6/30/2025				6/30/2024
	(In thousands)
Mortgage loan servicing, net:
Revenue, net	$	1,649			$	2,214			$	3,531			$	4,433
Fair value change due to price		(219	)			911				(1,752	)			2,176
Fair value change due to pay-downs		(862	)			(1,034	)			(1,753	)			(1,793	)
Loss on sale of originated servicing rights	$	(78	)		$	—				(172	)			—
Total	$	490			$	2,091			$	(146	)		$	4,816

Non-interest expenses totaled $33.8 million in the second quarter of 2025, compared to $33.3 million in the year-ago period.

The Company recorded income tax expense of $3.8 million in the second quarter of 2025. This compares to an income tax expense of $4.6 million in the second quarter of 2024. The change in income tax expense principally reflects changes in pre-tax earnings in 2025 relative to 2024.

Asset Quality

A breakdown of non-performing loans by loan type is as follows (1):

	6/30/2025				12/31/2024				6/30/2024
Loan Type	(Dollars in thousands)
Commercial	$	—			$	54			$	312
Mortgage		9,620				7,005				4,819
Installment		833				733				843
Sub total		10,453				7,792				5,974
Less - government guaranteed loans		2,249				1,790				1,489
Total non-performing loans	$	8,204			$	6,002			$	4,485
Ratio of non-performing loans to total portfolio loans		0.20	%			0.15	%			0.12	%
Ratio of non-performing assets to total assets		0.16	%			0.13	%			0.10	%
Ratio of allowance for credit losses to total non-performing loans		745.45	%			989.32	%			1253.98	%

(1) Non performing loans include non-accrual loans and loans 90 days or more past due and still accruing interest.

The provision for credit losses was an expense of $1.50 million and $0.02 million in the second quarters of 2025 and 2024, respectively. We recorded loan net charge offs of $0.37 million and $0.09 million in the second quarters of 2025 and 2024, respectively. At June 30, 2025, the allowance for credit losses for loans totaled $61.2 million, or 1.47% of total portfolio loans compared to $59.4 million, or 1.47% of total portfolio loans at December 31, 2024.

Balance Sheet, Capital and Liquidity

Total assets were $5.42 billion at June 30, 2025, an increase of $80.4 million from December 31, 2024. Loans, excluding loans held for sale, were $4.16 billion at June 30, 2025, compared to $4.04 billion at December 31, 2024. Deposits totaled $4.66 billion at June 30, 2025, an increase of $5.3 million from December 31, 2024. This increase is primarily due to increases in reciprocal and brokered time deposits that were partially offset by decreases in non-interest bearing, savings and interest-bearing checking and time deposits.

Cash and cash equivalents totaled $146.2 million at June 30, 2025, versus $119.9 million at December 31, 2024. Securities available for sale (“AFS”) totaled $509.5 million at June 30, 2025, versus $559.2 million at December 31, 2024.

Total shareholders’ equity was $469.3 million at June 30, 2025, or 8.66% of total assets compared to $454.7 million or 8.52% at December 31, 2024. Tangible common equity totaled $439.7 million at June 30, 2025, or $21.23 per share compared to $424.9 million or $20.33 per share at December 31, 2024. The increase in shareholders’ equity as well as tangible common equity are primarily the result of earnings retention.

The Company’s wholly owned subsidiary, Independent Bank, remains significantly above “well capitalized” for regulatory purposes with the following ratios:

Regulatory Capital Ratios	6/30/2025			12/31/2024			Well Capitalized Minimum
Tier 1 capital to average total assets	9.79	%		9.58	%		5.00	%
Common equity tier 1 capital to risk-weighted assets	11.90	%		11.74	%		6.50	%
Tier 1 capital to risk-weighted assets	11.90	%		11.74	%		8.00	%
Total capital to risk-weighted assets	13.15	%		12.99	%		10.00	%

At June 30, 2025, in addition to liquidity available from our normal operating, funding, and investing activities, we had unused credit lines with the FHLB and FRB of approximately $1.02 billion and $484.6 million, respectively. We also had approximately $486.0 million in fair value of unpledged securities AFS and HTM at June 30, 2025 which could be pledged for an estimated additional borrowing capacity at the FHLB and FRB of approximately $455.9 million.

Share Repurchase Plan

On December 17, 2024, the Board of Directors of the Company authorized the 2025 share repurchase plan. Under the terms of the 2025 share repurchase plan, the Company is authorized to purchase up to 1,100,000 shares, or approximately 5% of its then outstanding common stock. The repurchase plan is authorized to last through December 31, 2025. During the six month period ended June 30, 2025, there were 252,276 shares of common stock repurchased, for an aggregate purchase price of $7.36 million.

Earnings Conference Call

Brad Kessel, President and CEO, Gavin Mohr, CFO and Joel Rahn, EVP – Commercial Banking will review the quarterly results in a conference call for investors and analysts beginning at 11:00 am ET on Thursday, July 24, 2025.

To participate in the live conference call, please dial 1-833-470-1428 (Access Code # 493553). Also, the conference call will be accessible through an audio webcast with user-controlled slides via the following site/URL: https://events.q4inc.com/attendee/394984135.

A playback of the call can be accessed by dialing 1-866-813-9403 (Access Code # 372693). The replay will be available through July 31, 2025.

About Independent Bank Corporation

Independent Bank Corporation (NASDAQ: IBCP) is a Michigan-based bank holding company with total assets of approximately $5.4 billion. Founded as First National Bank of Ionia in 1864, Independent Bank Corporation operates a branch network across Michigan's Lower Peninsula through one state-chartered bank subsidiary. This subsidiary (Independent Bank) provides a full range of financial services, including commercial banking, mortgage lending, consumer banking, investments and insurance. Independent Bank Corporation is committed to providing exceptional personal service and value to its customers, stockholders and the communities it serves.

For more information, please visit our Web site at: IndependentBank.com.

Forward-Looking Statements
This presentation contains forward-looking statements, which are any statements or information that are not historical facts. These forward-looking statements include statements about our anticipated future revenue and expenses and our future plans and prospects.

Forward-looking statements involve inherent risks and uncertainties, and important factors could cause actual results to differ materially from those anticipated. For example, deterioration in general business and economic conditions or turbulence in domestic or global financial markets could adversely affect our revenues and the values of our assets and liabilities, reduce the availability of funding to us, lead to a tightening of credit, and increase stock price volatility. Our results could also be adversely affected by changes in interest rates; increases in unemployment rates; deterioration in the credit quality of our loan portfolios or in the value of the collateral securing those loans; deterioration in the value of our investment securities; legal and regulatory developments; changes in customer behavior and preferences; breaches in data security; and management’s ability to effectively manage the multitude of risks facing our business. Key risk factors that could affect our future results are described in more detail in our Annual Report on Form 10-K for the year ended December 31, 2024 and the other reports we file with the SEC, including under the heading “Risk Factors.” Investors should not place undue reliance on forward-looking statements as a prediction of our future results.

Any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise.

INDEPENDENT BANK CORPORATION AND SUBSIDIARIES Consolidated Statements of Financial Condition
		June 30, 2025				December 31, 2024
		(Unaudited)
		(In thousands, except share amounts)
Assets
Cash and due from banks		$	74,354			$	56,984
Interest bearing deposits			71,805				62,898
Cash and Cash Equivalents			146,159				119,882
Securities available for sale			509,511				559,182
Securities held to maturity (fair value of $293,658 at June 30, 2025 and $301,860 at December 31, 2024)			329,302				339,436
Federal Home Loan Bank and Federal Reserve Bank stock, at cost			18,102				16,099
Loans held for sale, carried at fair value			12,492				7,643
Loans
Commercial			2,068,081				1,937,364
Mortgage			1,528,360				1,516,726
Installment			567,926				584,735
Total Loans			4,164,367				4,038,825
Allowance for credit losses			(61,157	)			(59,379	)
Net Loans			4,103,210				3,979,446
Other real estate and repossessed assets, net			426				938
Property and equipment, net			38,409				37,492
Bank-owned life insurance			53,587				53,855
Capitalized mortgage loan servicing rights, carried at fair value			32,053				46,796
Other intangibles			1,244				1,488
Goodwill			28,300				28,300
Accrued income and other assets			145,724				147,547
Total Assets		$	5,418,519			$	5,338,104
Liabilities and Shareholders' Equity
Deposits
Non-interest bearing		$	1,007,976			$	1,013,647
Savings and interest-bearing checking			1,989,941				1,995,314
Reciprocal			911,814				907,031
Time			627,986				628,285
Brokered time			121,642				109,811
Total Deposits			4,659,359				4,654,088
Other borrowings			102,008				45,009
Subordinated debt			39,624				39,586
Subordinated debentures			39,830				39,796
Accrued expenses and other liabilities			108,448				104,939
Total Liabilities			4,949,269				4,883,418
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: 20,715,650 shares at June 30, 2025 and 20,895,714 shares at December 31, 2024			311,653				318,777
Retained earnings			227,484				205,853
Accumulated other comprehensive loss			(69,887	)			(69,944	)
Total Shareholders’ Equity			469,250				454,686
Total Liabilities and Shareholders’ Equity		$	5,418,519			$	5,338,104

INDEPENDENT BANK CORPORATION AND SUBSIDIARIES Consolidated Statements of Operations
		Three Months Ended												Six Months Ended
														June 30,
		June 30, 2025				March 31, 2025				June 30, 2024					2025				2024
		(Unaudited)
Interest Income		(In thousands, except per share amounts)
Interest and fees on loans		$	59,535			$	57,768			$	56,786			$	117,303			$	111,829
Interest on securities
Taxable			3,796				4,036				4,713				7,832				9,964
Tax-exempt			2,773				2,770				3,400				5,543				6,791
Other investments			774				1,570				1,439				2,344				2,880
Total Interest Income			66,878				66,144				66,338				133,022				131,464
Interest Expense
Deposits			20,462				20,955				22,876				41,417				45,686
Other borrowings and subordinated debt and debentures			1,801				1,504				2,116				3,305				4,235
Total Interest Expense			22,263				22,459				24,992				44,722				49,921
Net Interest Income			44,615				43,685				41,346				88,300				81,543
Provision for credit losses			1,500				721				19				2,221				763
Net Interest Income After Provision for Credit Losses			43,115				42,964				41,327				86,079				80,780
Non-interest Income
Interchange income			3,390				3,127				3,401				6,517				6,552
Service charges on deposit accounts			2,981				2,814				2,937				5,795				5,809
Net gains (losses) on assets
Mortgage loans			1,631				2,303				1,333				3,934				2,697
Equity securities at fair value			—				—				2,693				—				2,693
Securities available for sale			11				(330	)			—				(319	)			(269	)
Mortgage loan servicing, net			490				(636	)			2,091				(146	)			4,816
Other			2,822				3,146				2,717				5,968				5,435
Total Non-interest Income			11,325				10,424				15,172				21,749				27,733
Non-interest Expense
Compensation and employee benefits			21,123				20,383				21,251				41,506				42,021
Data processing			3,847				3,729				3,257				7,576				6,512
Occupancy, net			2,046				2,223				1,886				4,269				3,960
Interchange expense			1,177				1,119				1,127				2,296				2,224
Advertising			833				861				788				1,694				1,279
Furniture, fixtures and equipment			793				885				948				1,678				1,902
Loan and collection			744				786				699				1,530				1,211
FDIC deposit insurance			637				711				695				1,348				1,477
Communications			470				591				499				1,061				1,114
Legal and professional			500				479				544				979				1,030
Costs (recoveries) related to unfunded lending commitments			(389	)			196				(137	)			(193	)			(789	)
Other			1,981				2,299				1,776				4,280				3,585
Total Non-interest Expense			33,762				34,262				33,333				68,024				65,526
Income Before Income Tax			20,678				19,126				23,166				39,804				42,987
Income tax expense			3,801				3,536				4,638				7,337				8,468
Net Income		$	16,877			$	15,590			$	18,528			$	32,467			$	34,519
Net Income Per Common Share
Basic		$	0.81			$	0.74			$	0.89			$	1.56			$	1.65
Diluted		$	0.81			$	0.74			$	0.88			$	1.54			$	1.64

INDEPENDENT BANK CORPORATION AND SUBSIDIARIES Selected Financial Data
	June 30, 2025				March 31, 2025				December 31, 2024				September 30, 2024				June 30, 2024
	(unaudited)
	(Dollars in thousands except per share data)
Three Months Ended
Net interest income	$	44,615			$	43,685			$	42,851			$	41,854			$	41,346
Provision for credit losses		1,500				721				2,217				1,488				19
Non-interest income		11,325				10,424				19,121				9,508				15,172
Non-interest expense		33,762				34,262				36,987				32,583				33,333
Income before income tax		20,678				19,126				22,768				17,291				23,166
Income tax expense		3,801				3,536				4,307				3,481				4,638
Net income	$	16,877			$	15,590			$	18,461			$	13,810			$	18,528
Basic earnings per share	$	0.81			$	0.74			$	0.88			$	0.66			$	0.89
Diluted earnings per share		0.81				0.74				0.87				0.65				0.88
Cash dividend per share		0.26				0.26				0.24				0.24				0.24
Average shares outstanding		20,749,925				20,943,094				20,893,820				20,896,019				20,901,741
Average diluted shares outstanding		20,945,522				21,150,550				21,122,096				21,115,273				21,105,387
Performance Ratios
Return on average assets		1.27	%			1.18	%			1.39	%			1.04	%			1.44	%
Return on average equity		14.66				13.71				16.31				12.54				17.98
Efficiency ratio (1)		59.67				62.20				59.09				62.82				61.49
As a Percent of Average Interest-Earning Assets (1)
Interest income		5.35	%			5.28	%			5.37	%			5.48	%			5.45	%
Interest expense		1.77				1.79				1.92				2.11				2.05
Net interest income		3.58				3.49				3.45				3.37				3.40
Average Balances
Loans	$	4,128,771			$	4,060,941			$	3,994,661			$	3,909,954			$	3,849,199
Securities		846,052				883,676				912,073				933,750				944,435
Total earning assets		5,036,090				5,078,596				5,007,566				4,985,842				4,893,367
Total assets		5,324,959				5,378,022				5,300,368				5,275,623				5,181,317
Deposits		4,646,639				4,715,331				4,655,091				4,616,119				4,531,917
Interest bearing liabilities		3,763,477				3,799,852				3,717,483				3,689,684				3,611,972
Shareholders' equity		461,720				461,291				450,214				438,077				414,549

(1) Presented on a fully tax equivalent basis assuming a marginal tax rate of 21%.

INDEPENDENT BANK CORPORATION AND SUBSIDIARIES Selected Financial Data (continued)
	June 30, 2025				March 31, 2025				December 31, 2024				September 30, 2024				June 30, 2024
	(unaudited)
	(Dollars in thousands except per share data)
End of Period
Capital
Tangible common equity ratio		8.16	%			8.26	%			8.00	%			8.08	%			7.63	%
Tangible common equity ratio excluding accumulated other comprehensive loss		9.24				9.31				9.10				8.99				8.76
Average equity to average assets		8.67				8.58				8.49				8.30				8.00
Total capital to risk-weighted assets (2)		14.20				14.51				14.22				14.25				14.21
Tier 1 capital to risk-weighted assets (2)		12.23				12.34				12.06				12.06				12.01
Common equity tier 1 capital to risk-weighted assets (2)		11.36				11.45				11.17				11.16				11.09
Tier 1 capital to average assets (2)		10.07				9.89				9.85				9.63				9.59
Common shareholders' equity per share of common stock	$	22.65			$	22.28			$	21.76			$	21.65			$	20.60
Tangible common equity per share of common stock		21.23				20.87				20.33				20.22				19.16
Total shares outstanding		20,715,650				20,970,115				20,895,714				20,893,800				20,899,358
Selected Balances
Loans	$	4,164,367			$	4,072,691			$	4,038,825			$	3,942,287			$	3,851,889
Securities		838,813				866,604				898,618				932,312				936,194
Total earning assets		5,105,579				5,031,975				5,024,083				4,964,784				4,979,555
Total assets		5,418,519				5,328,428				5,338,104				5,259,268				5,277,500
Deposits		4,659,359				4,633,931				4,654,088				4,626,875				4,614,328
Interest bearing liabilities		3,832,845				3,768,435				3,764,832				3,682,482				3,694,025
Shareholders' equity		469,250				467,277				454,686				452,369				430,459

(2) June 30, 2025 are Preliminary.

Reconciliation of Non-GAAP Financial Measures
Independent Bank Corporation

Independent Bank Corporation believes non-GAAP measures are meaningful because they reflect adjustments commonly made by management, investors, regulators and analysts to evaluate the adequacy of common equity and performance trends. Tangible common equity is used by the Company to measure the quality of capital.

Reconciliation of Non-GAAP Financial Measures

	Three Months Ended June 30,								Six Months Ended June 30,
		2025				2024				2025				2024
	(Dollars in thousands)
Net Interest Margin, Fully Taxable Equivalent ("FTE")
Net interest income	$	44,615			$	41,346			$	88,300			$	81,543
Add: taxable equivalent adjustment		444				175				896				355
Net interest income - taxable equivalent	$	45,059			$	41,521			$	89,196			$	81,898
Net interest margin (GAAP) (1)		3.55	%			3.39	%			3.50	%			3.33	%
Net interest margin (FTE) (1)		3.58	%			3.40	%			3.54	%			3.35	%

(1) Annualized.

Tangible Common Equity Ratio

	June 30, 2025				March 31, 2025				December 31, 2024				September 30, 2024				June 30, 2024
	(Dollars in thousands)
Common shareholders' equity	$	469,250			$	467,277			$	454,686			$	452,369			$	430,459
Less:
Goodwill		28,300				28,300				28,300				28,300				28,300
Other intangibles		1,244				1,366				1,488				1,617				1,746
Tangible common equity		439,706				437,611				424,898				422,452				400,413
Addition:
Accumulated other comprehensive loss for regulatory purposes		64,089				61,285				64,146				52,454				65,030
Tangible common equity excluding accumulated other comprehensive loss adjustments	$	503,795			$	498,896			$	489,044			$	474,906			$	465,443
Total assets	$	5,418,519			$	5,328,428			$	5,338,104			$	5,259,268			$	5,277,500
Less:
Goodwill		28,300				28,300				28,300				28,300				28,300
Other intangibles		1,244				1,366				1,488				1,617				1,746
Tangible assets		5,388,975				5,298,762				5,308,316				5,229,351				5,247,454
Addition:
Net unrealized losses on available for sale securities and derivatives, net of tax		64,089				61,285				64,146				52,454				65,030
Tangible assets excluding accumulated other comprehensive loss adjustments	$	5,453,064			$	5,360,047			$	5,372,462			$	5,281,805			$	5,312,484
Common equity ratio		8.66	%			8.77	%			8.52	%			8.60	%			8.16	%
Tangible common equity ratio		8.16	%			8.26	%			8.00	%			8.08	%			7.63	%
Tangible common equity ratio excluding accumulated other comprehensive loss		9.24	%			9.31	%			9.10	%			8.99	%			8.76	%
Tangible Common Equity per Share of Common Stock:
Common shareholders' equity	$	469,250			$	467,277			$	454,686			$	452,369			$	430,459
Tangible common equity	$	439,706			$	437,611			$	424,898			$	422,452			$	400,413
Shares of common stock outstanding (in thousands)		20,716				20,970				20,896				20,894				20,899
Common shareholders' equity per share of common stock	$	22.65			$	22.28			$	21.76			$	21.65			$	20.60
Tangible common equity per share of common stock	$	21.23			$	20.87			$	20.33			$	20.22			$	19.16

The tangible common equity ratio removes the effect of goodwill and other intangible assets from capital and total assets. Tangible common equity per share of common stock removes the effect of goodwill and other intangible assets from common shareholders’ equity per share of common stock.

Contact:

William B. Kessel, President and CEO, 616.447.3933
Gavin A. Mohr, Chief Financial Officer, 616.447.3929

FAQ

What was IBCP's earnings per share in Q2 2025?

Independent Bank Corporation reported earnings of $0.81 per diluted share in Q2 2025, compared to $0.88 per share in Q2 2024.

How much did IBCP's loan portfolio grow in Q2 2025?

IBCP's loan portfolio grew by $91.7 million, representing a 9.0% annualized growth rate from March 31, 2025.

What is Independent Bank's current capital position?

As of June 30, 2025, IBCP maintained strong capital ratios with Tier 1 capital at 9.79% and Total capital to risk-weighted assets at 13.15%, well above regulatory requirements.

How much did IBCP's deposits change in Q2 2025?

Total deposits were $4.66 billion, showing a slight increase of $5.3 million from December 31, 2024, with core deposits declining by 1.4% annualized due to seasonality.

What is IBCP's asset quality status as of Q2 2025?

IBCP maintained strong asset quality with non-performing assets at 0.16% of total assets and an allowance for credit losses at 1.47% of total portfolio loans.