GRAND RAPIDS, Mich., April 23, 2026 (GLOBE NEWSWIRE) -- Independent Bank Corporation (NASDAQ: IBCP) reported first quarter 2026 net income of $16.9 million, or $0.81 per diluted share, versus net income of $15.6 million, or $0.74 per diluted share, in the prior-year period.
Highlights for the first quarter of 2026 include:
- A net interest margin of 3.65% (three basis point increase from the linked quarter);
- Increase in net interest income of $0.5 million (or 1.1% ) over the fourth quarter of 2025;
- Increase in tangible common equity per share of common stock of $0.33 (or 5.9% annualized) from December 31, 2025;
- A return on average assets and a return on average equity of 1.24% and 13.43%, respectively;
- Net growth in total deposits, less brokered time deposits, of $80.4 million (or 6.9% annualized) from December 31, 2025;
- Net growth in loans of $31.8 million (or 3.0% annualized) from December 31, 2025;
- An increase in the tangible common equity ratio to 8.7%; and
- The payment of a $0.28 per share quarterly dividend on common stock on February 13, 2026.
William B. (“Brad”) Kessel, the President and Chief Executive Officer of Independent Bank Corporation, commented: “Our first quarter results reflect the strength of our core fundamentals, including growth in net interest income, expansion in our net interest margin to 3.65%, and continued growth in both loans and core deposits. Balance sheet growth remained disciplined, with $80.4 million in core deposit growth and $31.8 million in total loan growth, including $53.8 million, or 9.9% annualized, in commercial loans, reflecting continued execution of our strategic plan. Credit quality remains sound, and while geopolitical uncertainty has increased, we have not seen a direct impact on our customers and continue to monitor conditions closely. Profitability remained strong, with a return on average assets of 1.24% and a return on average equity of 13.43%. We remain encouraged by our momentum, optimistic about our opportunities, and confident in the benefits our recently announced merger with HCB Financial Corp. will provide to enhancing shareholder value.”
Significant items impacting comparable first quarter 2026 and 2025 results include the following:
- Changes in the fair value due to price of capitalized mortgage loan servicing rights (the “MSR Changes”) of $0.9 million ($0.04 per diluted share, after taxes) for the three-month period ended March 31, 2026, as compared to $(1.5) million ($(0.06) per diluted share, after taxes) for the three-month period ended March 31, 2025.
Operating Results
The Company’s net interest income totaled $46.9 million during the first quarter of 2026, an increase of $3.2 million, or 7.3% from the year-ago period, and an increase of $0.5 million, or 1.1%, from the fourth quarter of 2025 which had two additional days of earnings. The Company’s tax equivalent net interest income as a percent of average interest-earning assets (the “net interest margin”) was 3.65% during the first quarter of 2026, compared to 3.49% in the year-ago period, and 3.62% in the fourth quarter of 2025. The increase in the net interest margin from the prior quarter was supported by a 16 basis point decrease in the cost of deposits. The year-over-year quarter and linked quarter increases in net interest income were due to both an increase in average interest-earning assets and the higher net interest margin. Average interest-earning assets were $5.21 billion in the first quarter of 2026, compared to $5.08 billion in the year-ago quarter and $5.16 billion in the fourth quarter of 2025.
Non-interest income totaled $12.0 million for the first quarter of 2026, compared to $10.4 million in the comparable prior year period. This change was primarily due to variances in mortgage banking related revenues.
Net gains on mortgage loans in the first quarters of 2026 and 2025 were approximately $1.3 million and $2.3 million, respectively. The comparative quarterly decrease in net gains on mortgage loans was due to a decrease in the gain on sale margin that was partially offset by an increase in the volume of mortgage loans sold.
Mortgage loan servicing, net, generated income (expense) of $1.6 million and $(0.6) million in the first quarters of 2026 and 2025, 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 partially offset by 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 $32.2 million and $31.5 million at March 31, 2026 and December 31, 2025, respectively.
Mortgage loan servicing, net activity is summarized in the following table:
Three months ended 3/31/2026 3/31/2025 (In thousands)Mortgage loan servicing, net: Revenue, net$1,636 $1,882 Fair value change due to price 933 (1,533)Fair value change due to pay-downs (923) (891)Loss on sale of originated servicing rights$— $(94)Total$1,646 $(636)Non-interest expenses totaled $38.3 million in the first quarter of 2026, compared to $34.3 million in the year-ago period. The increase in non-interest expense is primarily due to increases in compensation and employee benefits, advertising and merger related expenses as well as a $1.5 million litigation expense recorded during the quarter.
The Company recorded income tax expense of $3.4 million in the first quarter of 2026. This compares to an income tax expense of $3.5 million in the first quarter of 2025. The 2026 first quarter income tax expense includes a $0.2 million benefit from transferable energy tax credits.
Asset Quality
A breakdown of non-performing loans by loan type is as follows (1):
3/31/2026 12/31/2025 3/31/2025Loan Type(Dollars in thousands)Commercial$27,077 $23,531 $127 Mortgage 9,953 8,683 8,080 Installment 745 860 819 Sub total 37,775 33,074 9,026 Less - government guaranteed loans 10,202 9,947 1,940 Total non-performing loans$27,573 $23,127 $7,086 Ratio of non-performing loans to total portfolio loans 0.64% 0.54% 0.17%Ratio of non-performing assets to total assets 0.51% 0.44% 0.14%Ratio of allowance for credit losses to total non-performing loans 231.09% 274.33% 847.23%(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 $0.36 million and $0.72 million in the first quarters of 2026 and 2025, respectively. The Company recorded loan net charge offs of $0.27 million and $0.07 million in the first quarters of 2026 and 2025, respectively. At March 31, 2026, the allowance for credit losses for loans totaled $63.7 million, or 1.48% of total portfolio loans compared to $63.4 million, or 1.48% of total portfolio loans at December 31, 2025.
Balance Sheet, Capital and Liquidity
Total assets were $5.56 billion at March 31, 2026, an increase of $51.8 million from December 31, 2025. Loans, excluding loans held for sale, were $4.31 billion at March 31, 2026, compared to $4.28 billion at December 31, 2025. Deposits totaled $4.88 billion at March 31, 2026, an increase of $119.0 million from December 31, 2025. This increase is primarily due to increases in savings and interest-bearing checking, reciprocal, and brokered time deposits that were partially offset by a decrease in time deposits.
Cash and cash equivalents totaled $174.9 million at March 31, 2026, versus $138.4 million at December 31, 2025. Securities available for sale (“AFS”) totaled $482.3 million at March 31, 2026, versus $495.9 million at December 31, 2025.
Total shareholders’ equity was $510.6 million at March 31, 2026, or 9.19% of total assets compared to $503.0 million or 9.14% at December 31, 2025. Tangible common equity totaled $481.4 million at March 31, 2026, or $23.38 per share compared to $473.7 million or $23.05 per share at December 31, 2025. The increases in shareholders’ equity as well as tangible common equity are primarily the result of earnings retention that was partially offset by an increase in the accumulated other comprehensive loss.
The Company’s wholly owned subsidiary, Independent Bank, remains significantly above “well capitalized” for regulatory purposes with the following ratios:
Regulatory Capital Ratios3/31/2026 12/31/2025 WellCapitalized
Minimum Tier 1 capital to average total assets9.43% 9.36% 5.00%Common equity tier 1 capital to risk-weighted assets11.43% 11.24% 6.50%Tier 1 capital to risk-weighted assets11.43% 11.24% 8.00%Total capital to risk-weighted assets12.68% 12.49% 10.00%
At March 31, 2026, 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 $785.5 million and $1.36 billion, respectively. We also had approximately $440.7 million in fair value of unpledged securities AFS and HTM at March 31, 2026 which could be pledged for an estimated additional borrowing capacity at the FHLB and FRB of approximately $414.0 million.
Share Repurchase Plan
On December 16, 2025, the Board of Directors of the Company authorized the 2026 share repurchase plan. Under the terms of the 2026 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, 2026. During the three month period ended March 31, 2026, there were no shares of common stock repurchased.
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, April 23, 2026.
To access via phone, participants will need to register using the following link where they will be provided a phone number and access code: https://register-conf.media-server.com/register/BId259863bf9e8463883aeddb939de1580.
In order to view the webcast and presentation slides, please go to https://edge.media-server.com/mmc/p/989vrdc9 during the time of the call. A replay of the webcast will be available until April 23, 2027.
About Independent Bank Corporation
Independent Bank Corporation (NASDAQ: IBCP) is a Michigan-based bank holding company with total assets of approximately $5.6 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; the outcome of pending litigation; 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, 2025 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.
In addition, this release contains forward-looking statements regarding the proposed merger with HCB Financial Corp. ("HCB"). Important factors that could cause actual results to differ materially from those anticipated include: the risk that the merger may not be completed in a timely manner or at all; the failure to satisfy the conditions to the completion of the merger, including the receipt of all required regulatory and shareholder approvals; the occurrence of any event, change, or other circumstance that could give rise to the right of one or both parties to terminate the merger agreement; the risk that the anticipated benefits and cost savings of the merger may not be fully realized or may take longer to realize than expected; the risk of business disruption during the pendency of the merger; diversion of management's attention from ongoing business operations; the risk that the integration of HCB's operations with ours will be materially delayed or will be more costly or difficult than expected; and the potential for reputational risk related to the merger and integration.
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.
Additional Information and Where to Find It
In connection with the proposed acquisition of HCB, we expect to file with the SEC a registration statement on Form S-4 that will include a preliminary proxy statement of HCB and a preliminary prospectus of Independent Bank Corporation. Shareholders are urged to read the proxy statement/prospectus when it becomes available because it will contain important information about the proposed transaction. Free copies of these documents, when available, may be obtained at the SEC’s website (www.sec.gov) or upon written request to Independent Bank Corporation, 4200 East Beltline, Grand Rapids, MI 49525, Attention: Investor Relations, or HCB Financial Corp., 150 West Court Street, Hastings, MI 49058, Attention: Amanda Belcher-Currier, CFO. A final proxy statement/prospectus will be mailed to the shareholders of HCB.
No Offer or Solicitation
This communication is not an offer to sell or the solicitation of an offer to buy any securities, or a solicitation of any vote or approval, 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 under the securities laws of such jurisdiction.
Consolidated Statements of Financial Condition March 31,
2026 December 31,
2025 (Unaudited) (In thousands, except share
amounts)Assets Cash and due from banks$48,475 $52,235 Interest bearing deposits 126,440 86,152 Cash and Cash Equivalents 174,915 138,387 Securities available for sale 482,295 495,909 Securities held to maturity (fair value of $271,452 at March 31, 2026 and $282,830 at December 31, 2025) 301,007 309,523 Federal Home Loan Bank and Federal Reserve Bank stock, at cost 18,102 18,102 Loans held for sale, carried at fair value 19,714 9,031 Loans Commercial 2,267,369 2,213,557 Mortgage 1,520,358 1,524,821 Installment 520,372 537,907 Total Loans 4,308,099 4,276,285 Allowance for credit losses (63,719) (63,445)Net Loans 4,244,380 4,212,840 Other real estate and repossessed assets, net 767 896 Property and equipment, net 42,319 38,972 Bank-owned life insurance 54,072 53,750 Capitalized mortgage loan servicing rights, carried at fair value 32,233 31,493 Other intangibles, net 886 1,001 Goodwill 28,300 28,300 Accrued income and other assets 158,519 167,516 Total Assets$5,557,509 $5,505,720 Liabilities and Shareholders' Equity Deposits Non-interest bearing$991,140 $991,984 Savings and interest-bearing checking 2,146,403 2,113,260 Reciprocal 1,028,874 974,921 Time 657,043 662,858 Brokered time 57,220 18,659 Total Deposits 4,880,680 4,761,682 Other borrowings 27,010 77,003 Subordinated debentures 39,881 39,864 Accrued expenses and other liabilities 99,385 124,220 Total Liabilities 5,046,956 5,002,769 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: 20,585,805 shares at March 31, 2026 and 20,548,893 shares at December 31, 2025 307,679 307,845 Retained earnings 263,898 252,794 Accumulated other comprehensive loss (61,024) (57,688)Total Shareholders’ Equity 510,553 502,951 Total Liabilities and Shareholders’ Equity$5,557,509 $5,505,720
Consolidated Statements of Operations Three Months Ended March 31,
2026 December 31,
2025 March 31,
2025 (Unaudited)Interest Income(In thousands, except per share amounts)Interest and fees on loans$59,249 $60,205 $57,768 Interest on securities Taxable 3,354 3,513 4,036 Tax-exempt 2,522 2,633 2,770 Other investments 1,044 1,074 1,570 Total Interest Income 66,169 67,425 66,144 Interest Expense Deposits 18,397 20,109 20,955 Other borrowings and subordinated debt and debentures 917 962 1,504 Total Interest Expense 19,314 21,071 22,459 Net Interest Income 46,855 46,354 43,685 Provision for credit losses 362 1,923 721 Net Interest Income After Provision for Credit Losses 46,493 44,431 42,964 Non-interest Income Interchange income 3,234 3,186 3,127 Service charges on deposit accounts 2,935 3,096 2,814 Net gains (losses) on assets Mortgage loans 1,308 1,372 2,303 Securities available for sale (26) (15) (330)Mortgage loan servicing, net 1,646 899 (636)Other 2,951 3,420 3,146 Total Non-interest Income 12,048 11,958 10,424 Non-interest Expense Compensation and employee benefits 21,829 22,563 20,383 Data processing 3,952 3,428 3,729 Occupancy, net 2,413 2,171 2,223 Litigation expense 1,500 — — Advertising 1,210 991 861 Interchange expense 1,191 1,165 1,119 Furniture, fixtures and equipment 894 897 885 FDIC deposit insurance 799 861 711 Loan and collection 752 589 786 Communications 593 471 591 Legal and professional 591 787 479 Merger related expense 300 — — Other 2,287 2,155 2,495 Total Non-interest Expense 38,311 36,078 34,262 Income Before Income Tax 20,230 20,311 19,126 Income tax expense 3,355 1,739 3,536 Net Income$16,875 $18,572 $15,590 Net Income Per Common Share Basic$0.82 $0.90 $0.74 Diluted$0.81 $0.89 $0.74
Selected Financial Data March 31,
2026 December 31,
2025 September 30,
2025 June 30,
2025 March 31,
2025 (unaudited) (Dollars in thousands except per share data)Three Months Ended Net interest income$46,855 $46,354 $45,361 $44,615 $43,685 Provision for credit losses 362 1,923 1,991 1,500 721 Non-interest income 12,048 11,958 11,937 11,325 10,424 Non-interest expense 38,311 36,078 34,131 33,762 34,262 Income before income tax 20,230 20,311 21,176 20,678 19,126 Income tax expense 3,355 1,739 3,674 3,801 3,536 Net income$16,875 $18,572 $17,502 $16,877 $15,590 Basic net income per common share$0.82 $0.90 $0.85 $0.81 $0.74 Diluted net income per common share 0.81 0.89 0.84 0.81 0.74 Cash dividend per share 0.28 0.26 0.26 0.26 0.26 Average shares outstanding 20,574,506 20,639,758 20,702,235 20,749,925 20,943,094 Average diluted shares outstanding 20,780,188 20,848,634 20,904,857 20,945,522 21,150,550 Performance Ratios Return on average assets 1.24% 1.35% 1.27% 1.27% 1.18%Return on average equity 13.43 14.75 14.57 14.66 13.71 Efficiency ratio (1) 64.33 61.18 58.86 59.67 62.20 As a Percent of Average Interest-Earning Assets (1) Interest income 5.15% 5.24% 5.38% 5.35% 5.28%Interest expense 1.50 1.62 1.84 1.77 1.79 Net interest income 3.65 3.62 3.54 3.58 3.49 Average Balances Loans$4,315,371 $4,249,389 $4,201,557 $4,128,771 $4,060,941 Securities 796,251 815,269 826,362 846,052 883,676 Total earning assets 5,209,360 5,162,381 5,159,681 5,036,090 5,078,596 Total assets 5,522,244 5,449,518 5,451,922 5,324,959 5,378,022 Deposits 4,832,089 4,774,179 4,786,408 4,646,639 4,715,331 Interest bearing liabilities 3,892,702 3,846,367 3,862,024 3,763,477 3,799,852 Shareholders' equity 509,523 499,445 476,422 461,720 461,291
(1) Presented on a fully tax equivalent basis assuming a marginal tax rate of 21%.
Selected Financial Data (continued)
March 31,
2026 December 31,
2025 September 30,
2025 June 30,
2025 March 31,
2025 (unaudited) (Dollars in thousands except per share data)End of Period Capital Tangible common equity ratio 8.71% 8.65% 8.44% 8.16% 8.26%Tangible common equity ratio excluding accumulated other comprehensive loss 9.61 9.51 9.35 9.24 9.31 Average equity to average assets 9.23 9.16 8.74 8.67 8.58 Total capital to risk-weighted assets (2) 13.79 13.59 13.67 14.20 14.51 Tier 1 capital to risk-weighted assets (2) 12.54 12.33 12.42 12.23 12.34 Common equity tier 1 capital to risk-weighted assets (2) 11.70 11.49 11.55 11.36 11.45 Tier 1 capital to average assets (2) 10.34 10.27 10.07 10.07 9.89 Common shareholders' equity per share of common stock$24.80 $24.48 $23.72 $22.65 $22.28 Tangible common equity per share of common stock 23.38 23.05 22.29 21.23 20.87 Total shares outstanding 20,585,805 20,548,893 20,691,604 20,715,650 20,970,115 Selected Balances Loans$4,308,099 $4,276,285 $4,198,283 $4,164,367 $4,072,691 Securities 783,302 805,432 824,033 838,813 866,604 Total earning assets 5,255,657 5,195,002 5,204,380 5,105,579 5,031,975 Total assets 5,557,509 5,505,720 5,493,113 5,418,519 5,328,428 Deposits 4,880,680 4,761,682 4,859,155 4,659,359 4,633,931 Interest bearing liabilities 3,956,431 3,886,565 3,897,487 3,832,845 3,768,435 Shareholders' equity 510,553 502,951 490,742 469,250 467,277
(2) March 31, 2026 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 March 31, 2026 2025 (Dollars in thousands)Net Interest Margin, Fully Taxable Equivalent ("FTE") Net interest income$46,855 $43,685 Add: taxable equivalent adjustment 445 452 Net interest income - taxable equivalent$47,300 $44,137 Net interest margin (GAAP) (1) 3.61% 3.46%Net interest margin (Non-GAAP FTE) (1) 3.65% 3.49%(1) Annualized.
Tangible Common Equity Ratio
March 31,2026 December 31,
2025 September 30,
2025 June 30,
2025 March 31,
2025 (Dollars in thousands)Common shareholders' equity$510,553 $502,951 $490,742 $469,250 $467,277 Less: Goodwill 28,300 28,300 28,300 28,300 28,300 Other intangibles, net 886 1,001 1,123 1,244 1,366 Tangible common equity 481,367 473,650 461,319 439,706 437,611 Addition: Accumulated other comprehensive loss for regulatory purposes 55,226 51,891 54,833 64,089 61,285 Tangible common equity excluding accumulated other comprehensive loss adjustments$536,593 $525,541 $516,152 $503,795 $498,896 Total assets$5,557,509 $5,505,720 $5,493,113 $5,418,519 $5,328,428 Less: Goodwill 28,300 28,300 28,300 28,300 28,300 Other intangibles, net 886 1,001 1,123 1,244 1,366 Tangible assets 5,528,323 5,476,419 5,463,690 5,388,975 5,298,762 Addition: Net unrealized losses on available for sale securities and derivatives, net of tax 55,226 51,891 54,833 64,089 61,285 Tangible assets excluding accumulated other comprehensive loss adjustments$5,583,549 $5,528,310 $5,518,523 $5,453,064 $5,360,047 Common equity ratio 9.19% 9.14% 8.93% 8.66% 8.77%Tangible common equity ratio 8.71% 8.65% 8.44% 8.16% 8.26%Tangible common equity ratio excluding accumulated other comprehensive loss 9.61% 9.51% 9.35% 9.24% 9.31% Tangible Common Equity per Share of Common Stock: Common shareholders' equity$510,553 $502,951 $490,742 $469,250 $467,277 Tangible common equity$481,367 $473,650 $461,319 $439,706 $437,611 Shares of common stock outstanding (in thousands) 20,586 20,549 20,692 20,716 20,970 Common shareholders' equity per share of common stock$24.80 $24.48 $23.72 $22.65 $22.28 Tangible common equity per share of common stock$23.38 $23.05 $22.29 $21.23 $20.87
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, 616.447.3933Gavin A. Mohr, Chief Financial Officer, 616.447.3929