2024-04-17 20:19:56 ET
Summary
- Mercantile Bank is facing challenges with its net interest margin due to rising deposit costs and slowed growth in commercial loans.
- The bank is struggling to find new customers for loans, with many originations coming from refinancing existing mortgages.
- The Loan to Deposit Ratio is too high at 108%, limiting the bank's ability to make new loans until deposits increase.
Just as in its last quarterly report , Mercantile Bank ( MBWM ) showed signs of weakness related to its net interest margin. The cost of deposits continues to rise as a result of the increasingly realistic assumption of a "higher for longer" rate scenario, and this is raising some concerns. In addition, the growth rate of commercial loans has slowed significantly: +1.70%, annualized....
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Mercantile Bank: Signs Of Weakening Are Evident