# EDGAR Filing Document

**Accession Number:** 0001629019
**File Stem:** 0001104659-23-007957
**Filing Date:** 2023-1
**Character Count:** 51094
**Document Hash:** 4c00fcdd741605a579ce8fc1df56b740
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001104659-23-007957.hdr.sgml**: 20230130

**ACCESSION NUMBER**: 0001104659-23-007957

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 16

**CONFORMED PERIOD OF REPORT**: 20220130

**ITEM INFORMATION**: Results of Operations and Financial Condition

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20230130

**DATE AS OF CHANGE**: 20230130

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Merchants Bancorp
- **CENTRAL INDEX KEY:** 0001629019
- **STANDARD INDUSTRIAL CLASSIFICATION:** STATE COMMERCIAL BANKS [6022]
- **IRS NUMBER:** 205747400
- **STATE OF INCORPORATION:** IN
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-38258
- **FILM NUMBER:** 23567751

**BUSINESS ADDRESS:**
- **STREET 1:** 410 MONON BLVD
- **CITY:** CARMEL
- **STATE:** IN
- **ZIP:** 46032
- **BUSINESS PHONE:** 3175697420

**MAIL ADDRESS:**
- **STREET 1:** 410 MONON BLVD
- **CITY:** CARMEL
- **STATE:** IN
- **ZIP:** 46032

?xml version="1.0" encoding="utf-8"?

**United States**

**SECURITIES AND EXCHANGE COMMISSION** 

**WASHINGTON, D.C. 20549** 

**FORM 8-K**

------

**CURRENT REPORT**

**PURSUANT TO SECTION 13 OR 15(d) OF THE** 

**SECURITIES EXCHANGE ACT OF 1934**

**Date of Report (Date of earliest event reported): January 30, 2022**

**Merchants Bancorp**

**(Exact Name of Registrant as Specified in its Charter)**

---

| | | |
|:---|:---|:---|
| **Indiana** | **001-38258** | **20-5747400** |
| **(State or Other Jurisdiction**<br> **of Incorporation)** | **(Commission**<br> **File Number)** | **(IRS Employer**<br> **Identification No.)** |

---

**410 Monon Boulevard Carmel, Indiana 46032**

(Address of Principal Executive Offices) (Zip Code)

**(317) 569-7420**

(Registrant's Telephone Number, Including Area Code)

**Not Applicable**

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

---

| |
|:---|
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |

---

Securities registered pursuant to Section 12(b) of the Act:

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp;Title of each class | &nbsp;&nbsp;Trading <br> Symbol(s) | &nbsp;&nbsp;Name of each exchange on which registered |
| &nbsp;&nbsp;Common Stock, without par value | &nbsp;&nbsp;MBIN | &nbsp;&nbsp;NASDAQ |
| &nbsp;&nbsp; Series A Preferred Stock, without par value | &nbsp;&nbsp;MBINP | &nbsp;&nbsp;NASDAQ |
| &nbsp;&nbsp;Depositary Shares, each representing a 1/40th interest in a share of Series B Preferred Stock, without par value | &nbsp;&nbsp;MBINO | &nbsp;&nbsp;NASDAQ |
| &nbsp;&nbsp;Depositary Shares, each representing a 1/40th interest in a share of Series C Preferred Stock, without par value | &nbsp;&nbsp;MBINN | &nbsp;&nbsp;NASDAQ |
| &nbsp;&nbsp;Depositary Shares, each representing a 1/40th interest in a share of Series D Preferred Stock, without par value | &nbsp;&nbsp;MBINM | &nbsp;&nbsp;NASDAQ |

---

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ⌧

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

**Item 2.02. Results of Operations and Financial Condition.**

On January 30, 2023, Merchants Bancorp issued a press release reporting its financial results for the fourth quarter and full fiscal year 2022. The press release is furnished as Exhibit 99.1 hereto and is incorporated herein by reference.

**Item 9.01. Financial Statements and Exhibits.**

**(d) Exhibits.**

---

| | |
|:---|:---|
| **Exhibit<br> No.** | **Description** |
| [99.1](tm234858d1_ex99-1.htm) | [Press Release dated January 30, 2023 issued by Merchants Bancorp.](tm234858d1_ex99-1.htm) |
| 104 | Cover Page Interactive Data File. The cover page XBRL tags are embedded within the inline XBRL document. |

---

**SIGNATURE**

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

---

| | | |
|:---|:---|:---|
|  | **MERCHANTS BANCORP** | **MERCHANTS BANCORP** |
| Date: January 30, 2023 | By: | /s/ John F. Macke |
|  |  | Name: John F. Macke |
|  |  | Title: Chief Financial Officer |

---

## Exhibit 99.1

**Exhibit 99.1**

![](tm234858d1_ex99-1img003.jpg)

![](tm234858d1_ex99-1img002.jpg)

PRESS RELEASE

**Merchants Bancorp Reports Full Year and Fourth Quarter 2022 Results** 

***For Release January 30, 2023***

&nbsp;&nbsp;&nbsp;&nbsp;· Full
 year 2022 net income of $219.7 million decreased 3% compared to 2021

&nbsp;&nbsp;&nbsp;&nbsp;· Full
 year 2022 diluted earnings per common share of $4.47 decreased 6% compared to 2021

&nbsp;&nbsp;&nbsp;&nbsp;· Fourth
 quarter 2022 net income of $57.2 million increased 4% compared to fourth quarter of 2021
 and decreased 2% compared to the third quarter 2022

&nbsp;&nbsp;&nbsp;&nbsp;· Fourth
 quarter 2022 diluted earnings per common share of $1.12 decreased 2% compared to the fourth
 quarter of 2021 and decreased 8% compared to the third quarter of 2022

&nbsp;&nbsp;&nbsp;&nbsp;· Total
 assets of $12.6 billion increased 5% compared to September 30, 2022, and increased 12% compared
 to December 31, 2021

&nbsp;&nbsp;&nbsp;&nbsp;· Loans
 receivable of $7.4 billion, net of allowance for credit losses on loans, increased $0.5 billion,
 or 7%, compared to September 30, 2022, and increased $1.7 billion, or 29% compared to December
 31, 2021

&nbsp;&nbsp;&nbsp;&nbsp;· Net
 interest margin was 3.13% in the fourth quarter of 2022 compared to 2.70% in the fourth quarter
 of 2021 and 3.05% in the third quarter of 2022

&nbsp;&nbsp;&nbsp;&nbsp;· Efficiency
 ratio was 31.3% in the fourth quarter of 2022 compared to 33.3% in the fourth quarter of
 2021 and 30.5% in the third quarter of 2022

&nbsp;&nbsp;&nbsp;&nbsp;· Tangible
 book value per common share of $21.88 increased 22% compared to $17.96 in the fourth quarter
 of 2021 and increased 5% compared to $20.78 in the third quarter of 2022

&nbsp;&nbsp;&nbsp;&nbsp;· On
 November 3, 2022, the Company completed a $284 million securitization of 16 multi-family
 mortgage loans through a Freddie Mac-sponsored Q-Series transaction

**CARMEL, Indiana** – (PR Newswire) - Merchants Bancorp (the "Company" or "Merchants") (Nasdaq: MBIN), parent company of Merchants Bank of Indiana, today reported fourth quarter 2022 net income of $57.2 million, or diluted earnings per common share of $1.12. This compared to $55.2 million, or diluted earnings per common share of $1.14 in the fourth quarter of 2021, and compared to $58.5 million, or diluted earnings per common share of $1.22 in the third quarter of 2022.

"We had a strong finish to 2022, on the heels of a $1.2 billion multi-family loan securitization and a $142.5 million preferred capital raise in the last quarter to support the loan growth in our pipeline. We continued our momentum of loan growth and executed our strategy to add shareholder value in any economic or interest rate environment. Tangible book value grew by 22%, to $21.88 per share during 2022 and our efficiency ratio remained at an industry-leading 31.3% for the year. The Company continues to enhance its product offerings and is well positioned to continue delivering superior results for the foreseeable future," said Michael F. Petrie, Chairman and CEO of Merchants.

Michael J. Dunlap, President and Chief Operating Officer of Merchants, added, "Our team has surpassed all expectations in 2022 by providing strong results and new opportunities to add value to our customers. Their focus and dedication to executing well in a dynamic interest rate environment has led to our continued success and excitement about what is on the horizon in 2023."

Net income for the fourth quarter 2022 increased by $2.0 million, or 4% compared to the fourth quarter of 2021, primarily driven by a $22.7 million, or 31% increase in net interest income that was partially offset by a $17.2 million, or 60%, decrease in gain on sale of loans and a $3.8 million, or 148%, increase in provision for credit losses.

Net income for the fourth quarter 2022 decreased by $1.3 million, or 2%, compared to the third quarter of 2022, primarily driven by a $6.2 million, or 21%, decrease in noninterest income, a $4.2 million increase in provision for credit losses, and a $2.2 million, or 6%, increase in noninterest expense that was partially offset by a $10.0 million, or 12% increase in net interest income.

**Total Assets**

Total assets of $12.6 billion at December 31, 2022 increased 5%, compared to September 30, 2022, and increased 12%, compared to December 31, 2021. Increases compared to both periods were primarily due to significant growth in the multi-family and healthcare loan portfolios, as well as an increase in held to maturity securities that were acquired in connection with the Company's loan sales and securitizations.

Return on average assets was 1.84% for the fourth quarter of 2022 compared to 2.02% for the fourth quarter of 2021 and 2.05% for the third quarter of 2022.

Page \| 2

**Asset Quality**

The allowance for credit losses on loans of $44.0 million at December 31, 2022 increased $5.0 million compared to September 30, 2022 and increased $12.7 million compared to December 31, 2021. The increases were primarily due to growth in the multi-family, commercial, residential, and healthcare loan portfolios, as well as revisions to market forecasts for unemployment and home price indices.

Non-performing loans were $26.7 million, or 0.38%, of loans receivable at December 31, 2022, compared to 0.38% at September 30, 2022 and 0.01% at December 31, 2021. The increase compared to both periods was primarily due to the delinquency of one healthcare customer that is fully collateralized and full payment is expected.

**Total Deposits**

Total deposits of $10.1 billion at December 31, 2022 decreased $248.1 million, or 2%, compared to September 30, 2022, and increased $1.1 billion, or 12%, compared to December 31, 2021. The decrease compared September 30, 2022, was primarily due to a decrease in demand deposit accounts that was partially offset by an increase in certificates of deposits. The increase compared to December 31, 2021, was primarily due to an increase in brokered certificates of deposit that was partially offset by a decrease in demand accounts.

Total brokered deposits of $2.8 billion at December 31, 2022 increased $544.1 million, or 25%, from September 30, 2022 and increased $603.0 million, or 28%, from December 31, 2021. Brokered deposits represented 27% of total deposits at December 31, 2022 compared to 22% of total deposits at September 30, 2022 and 24% of total deposits at December 31, 2021. As of December 31, 2022, brokered certificates of deposit had a weighted average remaining duration of 73 days, with none exceeding 180 days.

The Company continues to offer new products, such as adjustable-rate certificates of deposits, to minimize interest rate risks by aligning the rate and duration characteristics of its deposit and loan portfolios.

**Liquidity**

Cash balances of $226.2 million at December 31, 2022 decreased by $97.8 million compared to September 30, 2022 and decreased by $806.5 million compared to December 31, 2021. The Company continues to have significant borrowing capacity, with unused lines of credit totaling $3.1 billion at December 31, 2022 compared to $2.8 billion at September 30, 2022 and $2.4 billion at December 31, 2021. This liquidity enhances the ability to effectively manage interest expense and asset levels in the future. Additionally, the Company's business model is designed to continuously sell a significant portion of its loans, which provides flexibility in managing its liquidity.

Page \| 3

**<u>Comparison of Operating Results for the Three Months Ended</u>**

**<u>December 31, 2022 and 2021</u>**

**Net Interest Income** of $95.4 million increased $22.7 million, or 31% compared to $72.7 million, reflecting higher yields and average balances on loans and loans held for sale, as well as securities held to maturity, which were partially offset by higher interest rates on deposits and borrowings.

&nbsp;&nbsp;&nbsp;&nbsp;· Interest rate spread
 of 2.69% increased 7 basis points compared to 2.62%.

&nbsp;&nbsp;&nbsp;&nbsp;· Net
 interest margin of 3.13% increased 43 basis points compared to 2.70%.

**Interest Income** of $181.4 million increased 120% compared to $82.6 million, reflecting an increase in both yields and average balances of loans and loans held for sale, as well as new balances in securities held to maturity.

&nbsp;&nbsp;&nbsp;&nbsp;· Average balances of
 $10.3 billion for loans and loans held for sale increased 14% compared to $9.1 billion.

&nbsp;&nbsp;&nbsp;&nbsp;· Average yield on loans
 and loans held for sale of 6.34% increased 297 basis points compared to 3.37%.

**Interest Expense** of $86.0 million increased $76.2 million, or 774%, compared to $9.8 million. Interest expense on deposits of $81.1 million increased $72.6 million, or 855%, compared $8.5 million, primarily reflecting higher rates on interest bearing checking, money market, and certificates of deposit accounts.

&nbsp;&nbsp;&nbsp;&nbsp;· Average balances of
 $10.0 billion for interest-bearing deposits increased 20% compared to $8.3 billion.

&nbsp;&nbsp;&nbsp;&nbsp;· Average interest rates
 of 3.22% for interest-bearing deposits increased 281 basis points compared to 0.41%.

Page \| 4

**Noninterest Income** of $23.0 million decreased $17.3 million, or 43%, compared to $40.3 million, primarily due to a $17.2 million decrease in gain on sale of loans, partially offset by a $1.3 million increase in loan servicing fees.

&nbsp;&nbsp;&nbsp;&nbsp;· The decrease in gain
 on sale of loans was associated with a business mix shift in multi-family lending, from volumes
 sold in the secondary market towards those maintained on the balance sheet.

&nbsp;&nbsp;&nbsp;&nbsp;· Loan servicing fees
 included a $0.2 million negative fair market value adjustment to mortgage servicing rights,
 with a $0.6 million negative adjustment in the Banking segment and a $0.4 million positive
 adjustment in the Multi-family Mortgage Banking segment. This compared to a $1.9 million
 positive fair market value adjustment to mortgage servicing rights, of which $0.9 million
 was in the Banking segment and $1.0 million was in the Multi-family Mortgage Banking segment.

**Noninterest Expense** of $37.1 million decreased $0.5 million, or 1%, compared to $37.6 million, primarily due to decreases in salaries and employee benefits from lower commissions on gain on sale of loans.

&nbsp;&nbsp;&nbsp;&nbsp;· The efficiency ratio
 of 31.3% decreased 197 basis points compared to 33.3%.

**<u>Comparison of Operating Results for the Three Months Ended</u>**

**<u>December 31, 2022 and September 30, 2022</u>**

**Net Interest Income** of $95.4 million increased $10.0 million, or 12% compared to $85.4 million, reflecting higher yields and average balances on loans and loans held for sale that were partially offset by higher interest rates and average balances on deposits and borrowings.

&nbsp;&nbsp;&nbsp;&nbsp;· Interest rate spread
 of 2.69% decreased 8 basis points compared to 2.77%.

&nbsp;&nbsp;&nbsp;&nbsp;· Net
 interest margin of 3.13% increased 8 basis points compared to 3.05%.

**Interest Income** of $181.4 million increased $47.3 million, or 35%, compared to $134.1 million, reflecting an increase in yields and average balances of loans and loans held for sale, as well as an increase in balances of securities held to maturity.

&nbsp;&nbsp;&nbsp;&nbsp;· Average balances of
 $10.3 billion for loans and loans held for sale increased $54.5 million, or 1%, compared
 to $10.2 billion.

&nbsp;&nbsp;&nbsp;&nbsp;· Average yield on loans
 and loans held for sale of 6.34% increased 134 basis points compared to 5.00%.

Page \| 5

**Interest Expense** of $86.0 million increased $37.3 million, or 77%, compared to $48.7 million. Interest expense on deposits of $81.1 million increased $36.1 million, or 80%, compared to $45.0 million, reflecting higher interest rates on interest bearing checking, money market, and certificates of deposit accounts.

&nbsp;&nbsp;&nbsp;&nbsp;· Average balances of
 $10.0 billion for interest-bearing deposits increased $1.0 billion, or 11%, compared to $9.0
 billion.

&nbsp;&nbsp;&nbsp;&nbsp;· Average interest rates
 of 3.22% for interest-bearing deposits increased 124 basis points compared to 1.98%.

**Noninterest Income** of $23.0 million decreased $6.2 million, or 21%, compared $29.2 million, primarily due to a $5.5 million, or 67% decrease in loan servicing fees related to lower fair market value adjustments to mortgage servicing rights, and a $2.1 million, or 16%, decrease in gain on sale of loans.

&nbsp;&nbsp;&nbsp;&nbsp;· The decrease in gain
 on sale of loans was associated with lower volume in the secondary market for multi-family
 loans.

&nbsp;&nbsp;&nbsp;&nbsp;· Loan servicing fees
 included a $0.2 million negative fair market value adjustment to mortgage servicing rights,
 with a $0.6 million negative adjustment in the Banking segment and a $0.4 million positive
 adjustment in the Multi-family Mortgage Banking segment. This compared to a $4.6 million
 positive fair market value adjustment to servicing rights, of which $0.9 million was in the
 Banking segment and $3.7 million was in the Multi-family Mortgage Banking segment.

**Noninterest Expense** of $37.1 million increased $2.2 million, or 6%, compared to $35.0 million, primarily due to increases in professional fees related to growth in the low-income housing tax credit syndication business.

&nbsp;&nbsp;&nbsp;&nbsp;· The efficiency ratio
 of 31.3% increased 80 basis points compared to 30.5%.

**<u>About Merchants Bancorp</u>**

Ranked as a top performing U.S. public bank by S&P Global Market Intelligence, Merchants Bancorp is a diversified bank holding company headquartered in Carmel, Indiana operating multiple segments, including Multi-family Mortgage Banking that offers multi-family housing and healthcare facility financing and servicing; Mortgage Warehousing that offers mortgage warehouse financing; and Banking that offers retail and correspondent residential mortgage banking, agricultural lending, and traditional community banking. Merchants Bancorp, with $12.6 billion in assets and $10.1 billion in deposits as of December 31, 2022, conducts its business primarily through its direct and indirect subsidiaries, Merchants Bank of Indiana, Merchants Capital Corp., Merchants Capital Investments, LLC, Merchants Capital Servicing, LLC, Merchants Asset Management, LLC, Farmers-Merchants Bank of Illinois, and Merchants Mortgage, a division of Merchants Bank of Indiana. For more information and financial data, please visit Merchants' Investor Relations page at <u>investors.merchantsbancorp.com</u>.

Page \| 6

**Forward-Looking Statements** 

This press release contains forward-looking statements which reflect management's current views with respect to, among other things, future events and financial performance. These statements are often, but not always, made through the use of words or phrases such as "may," "might," "should," "could," "predict," "potential," "believe," "expect," "continue," "will," "anticipate," "seek," "estimate," "intend," "plan," "projection," "goal," "target," "outlook," "aim," "would," "annualized" and "outlook," or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about the industry, management's beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control, such as the potential impacts of the COVID-19 pandemic. Accordingly, management cautions that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. A number of important factors could cause actual results to differ materially from those indicated in these forward-looking statements, including the impacts of the COVID-19 pandemic, such as the severity, magnitude, duration and businesses' and governments' responses thereto, on the Company's operations and personnel, and on activity and demand across its businesses, and other factors identified in "Risk Factors" or "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company's Annual Report on Form 10-K and other periodic filings with the Securities and Exchange Commission. Any forward-looking statements presented herein are made only as of the date of this press release, and the Company does not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

**MEDIA CONTACT: REBECCA MARSH**

Merchants Bancorp

Phone: (317) 805-4356

Email: <u>rmarsh@merchantsbankofindiana.com</u>

**INVESTOR CONTACT: JOHN MACKE**

Merchants Bancorp

Phone: (317) 536-7421

Email: <u>jmacke@merchantsbankofindiana.com</u>

Page \| 7

**Consolidated Balance Sheets**

(Unaudited)

(In thousands, except share data)

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31,**<br>**2022** | **September 30,**<br>**2022** | **June 30,**<br>**2022** | **March 31,**<br>**2022** | **December 31,**<br>**2021** |
| **Assets** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Cash and due from banks | $22170 | $13796 | $10714 | $9853 | $14030 |
| &nbsp;&nbsp;&nbsp;Interest-earning demand accounts | 203994 | 310165 | 247432 | 401668 | 1018584 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | 226164 | 323961 | 258146 | 411521 | 1032614 |
| &nbsp;&nbsp;&nbsp;Securities purchased under agreements to resell | 3464 | 3497 | 3520 | 4798 | 5888 |
| &nbsp;&nbsp;&nbsp;Mortgage loans in process of securitization | 154194 | 137448 | 323046 | 324280 | 569239 |
| &nbsp;&nbsp;&nbsp;Securities available for sale | 323337 | 322069 | 336814 | 314266 | 310629 |
| &nbsp;&nbsp;&nbsp;Securities held to maturity | 1119078 | 1005487 |  |  |  |
| &nbsp;&nbsp;&nbsp;Federal Home Loan Bank (FHLB) stock | 39130 | 39130 | 39130 | 28804 | 29588 |
| &nbsp;&nbsp;&nbsp;Loans held for sale (includes $82,192, $68,785, $41,991, $14,567 and $48,583, respectively, at fair value) | 2910576 | 2844750 | 2759116 | 2289094 | 3303199 |
| &nbsp;&nbsp;&nbsp;Loans receivable, net of allowance for credit losses on loans of $44,014, $38,996, $37,474, $32,102 and $31,344, respectively | 7426858 | 6919128 | 7033203 | 5976960 | 5751319 |
| &nbsp;&nbsp;&nbsp;Premises and equipment, net | 35438 | 35492 | 35085 | 34559 | 31212 |
| &nbsp;&nbsp;&nbsp;Servicing rights | 146248 | 144984 | 130710 | 121036 | 110348 |
| &nbsp;&nbsp;&nbsp;Interest receivable | 56262 | 40170 | 26184 | 23499 | 24103 |
| &nbsp;&nbsp;&nbsp;Goodwill | 15845 | 15845 | 15845 | 15845 | 15845 |
| &nbsp;&nbsp;&nbsp;Intangible assets, net | 1186 | 1307 | 1441 | 1574 | 1707 |
| &nbsp;&nbsp;&nbsp;Other assets and receivables | 157447 | 145454 | 123815 | 104356 | 92947 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total assets | $12615227 | $11978722 | $11086055 | $9650592 | $11278638 |
| **Liabilities and Shareholders' Equity** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;**Liabilities** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deposits |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Noninterest-bearing | $326875 | $315868 | $444461 | $461193 | $641442 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest-bearing | 9744470 | 10003611 | 7855277 | 7014628 | 8341171 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total deposits | 10071345 | 10319479 | 8299738 | 7475821 | 8982613 |
| &nbsp;&nbsp;&nbsp;Borrowings | 930392 | 97279 | 1440904 | 879929 | 1033954 |
| &nbsp;&nbsp;&nbsp;Deferred and current tax liabilities, net | 19613 | 19124 | 19414 | 30695 | 19170 |
| &nbsp;&nbsp;&nbsp;Other liabilities | 134138 | 130250 | 97460 | 75644 | 87492 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities | 11155488 | 10566132 | 9857516 | 8462089 | 10123229 |
| **Commitments and Contingencies** |  |  |  |  |  |
| **Shareholders' Equity** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Common stock, without par value |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Authorized - 75,000,000 shares, 75,000,000 shares, 75,000,000 shares, 50,000,000 shares and 50,000,000 shares |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Issued and outstanding - 43,113,127 shares, 43,109,578 shares, 43,106,505 shares, 43,267,776 shares and 43,180,079 shares | 137781 | 137226 | 136671 | 137882 | 137565 |
| &nbsp;&nbsp;&nbsp;Preferred stock, without par value - 5,000,000 total shares authorized |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7% Series A Preferred stock - $25 per share liquidation preference |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Authorized - 3,500,000 shares |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Issued and outstanding - 2,081,800 shares | 50221 | 50221 | 50221 | 50221 | 50221 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6% Series B Preferred stock - $1,000 per share liquidation preference |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Authorized - 125,000 shares |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Issued and outstanding - 125,000 shares (equivalent to 5,000,000 depositary shares) | 120844 | 120844 | 120844 | 120844 | 120844 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6% Series C Preferred stock - $1,000 per share liquidation preference |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Authorized - 200,000 shares |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Issued and outstanding - 196,181 shares (equivalent to 7,847,233 depositary shares) | 191084 | 191084 | 191084 | 191084 | 191084 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.25% Series D Preferred stock - $1,000 per share liquidation preference |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Authorized - 300,000 shares |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Issued and outstanding - 142,500 shares (equivalent to 5,700,000 depositary shares) | 137459 | 137371 |  |  |  |
| &nbsp;&nbsp;&nbsp;Retained earnings | 832871 | 787530 | 737789 | 694776 | 657149 |
| &nbsp;&nbsp;&nbsp;Accumulated other comprehensive loss | (10521) | (11686) | (8070) | (6304) | (1454) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total shareholders' equity | 1459739 | 1412590 | 1228539 | 1188503 | 1155409 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities and shareholders' equity | $12615227 | $11978722 | $11086055 | $9650592 | $11278638 |

---

**Consolidated Statement of Income**

(Unaudited)

(In thousands, except share data)

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Three Months Ended** | **Change** | **Change** |
|  | **December 31,<br> 2022** | **September 30,<br> 2022** | **December 31,<br> 2021** | **4Q22** **<br> vs. 3Q22** | **4Q22** **<br> vs. 4Q21** |
| **Interest Income** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Loans | $164682 | $129101 | $77113 | 28% | 114% |
| &nbsp;&nbsp;&nbsp;Mortgage loans in process of securitization | 2551 | 2162 | 4018 | 18% | -37% |
| &nbsp;&nbsp;&nbsp;Investment securities: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Available for sale - taxable | 704 | 485 | 1007 | 45% | -30% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Available for sale - tax exempt |  |  | 9 |  | -100% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Held to maturity | 11412 | 970 |  | 1076% | 100% |
| &nbsp;&nbsp;&nbsp;Federal Home Loan Bank stock | 288 | 379 | 177 | -24% | 63% |
| &nbsp;&nbsp;&nbsp;Other | 1802 | 1015 | 261 | 78% | 590% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total interest income | 181439 | 134112 | 82585 | 35% | 120% |
| **Interest Expense** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Deposits | 81062 | 45002 | 8492 | 80% | 855% |
| &nbsp;&nbsp;&nbsp;Borrowed funds | 4967 | 3725 | 1350 | 33% | 268% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total interest expense | 86029 | 48727 | 9842 | 77% | 774% |
| **Net Interest Income** | 95410 | 85385 | 72743 | 12% | 31% |
| &nbsp;&nbsp;&nbsp;Provision for credit losses | 6407 | 2225 | 2585 | 188% | 148% |
| **Net Interest Income After Provision for Credit Losses** | 89003 | 83160 | 70158 | 7% | 27% |
| **Noninterest Income** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Gain on sale of loans | 11267 | 13354 | 28430 | -16% | -60% |
| &nbsp;&nbsp;&nbsp;Loan servicing fees, net | 2691 | 8169 | 1382 | -67% | 95% |
| &nbsp;&nbsp;&nbsp;Mortgage warehouse fees | 1081 | 1105 | 2469 | -2% | -56% |
| &nbsp;&nbsp;&nbsp;Gains on sale of investments available for sale <sup>(1)</sup> |  |  | 191 |  | -100% |
| &nbsp;&nbsp;&nbsp;Syndication and asset management fees | 4207 | 3073 | 5329 | 37% | -21% |
| &nbsp;&nbsp;&nbsp;Other income | 3736 | 3485 | 2470 | 7% | 51% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total noninterest income | 22982 | 29186 | 40271 | -21% | -43% |
| **Noninterest Expense** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Salaries and employee benefits | 22290 | 23027 | 25387 | -3% | -12% |
| &nbsp;&nbsp;&nbsp;Loan expenses | 1082 | 1226 | 1479 | -12% | -27% |
| &nbsp;&nbsp;&nbsp;Occupancy and equipment | 2377 | 1967 | 2069 | 21% | 15% |
| &nbsp;&nbsp;&nbsp;Professional fees | 3739 | 2429 | 3325 | 54% | 12% |
| &nbsp;&nbsp;&nbsp;Deposit insurance expense | 1279 | 755 | 705 | 69% | 81% |
| &nbsp;&nbsp;&nbsp;Technology expense | 1417 | 1325 | 1123 | 7% | 26% |
| &nbsp;&nbsp;&nbsp;Other expense | 4925 | 4222 | 3558 | 17% | 38% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total noninterest expense | 37109 | 34951 | 37646 | 6% | -1% |
| **Income Before Income Taxes** | 74876 | 77395 | 72783 | -3% | 3% |
| Provision for income taxes <sup>(2)</sup> | 17720 | 18907 | 17582 | -6% | 1% |
| **Net Income** | $57156 | $58488 | $55201 | -2% | 4% |
| &nbsp;&nbsp;&nbsp;Dividends on preferred stock | (8797) | (5729) | (5728) | 54% | 54% |
| **Net Income Allocated to Common Shareholders** | $48359 | $52759 | $49473 | -8% | -2% |
| **Basic Earnings Per Share** | $1.12 | $1.22 | $1.15 | -8% | -3% |
| **Diluted Earnings Per Share** | $1.12 | $1.22 | $1.14 | -8% | -2% |
| **Weighted-Average Shares Outstanding** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic | 43111353 | 43107975 | 43179377 |  |  |
| &nbsp;&nbsp;&nbsp;Diluted | 43274758 | 43258925 | 43399064 |  |  |

---

<sup>(1)</sup> Includes $0, $0, and $191 respectively, related to accumulated other comprehensive earnings reclassifications.

<sup>(2)</sup> Includes $0, $0, and $(46) respectively, related to income tax (expense)/benefit for reclassification items.

**Consolidated Statement of Income**

(Unaudited)

(In thousands, except share data)

---

| | | | |
|:---|:---|:---|:---|
|  | **Twelve Months Ended** | **Twelve Months Ended** | |
|  | **December 31,**<br>**2022** | **December 31,**<br>**2021** | <br>**Change** |
| **Interest Income** |  |  |  |
| &nbsp;&nbsp;&nbsp;Loans | $451973 | $293830 | 54% |
| &nbsp;&nbsp;&nbsp;Mortgage loans in process of securitization | 8407 | 12746 | -34% |
| &nbsp;&nbsp;&nbsp;Investment securities: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Available for sale - taxable | 2807 | 3309 | -15% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Available for sale - tax exempt |  | 41 | -100% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Held to maturity | 12382 |  | 100% |
| &nbsp;&nbsp;&nbsp;Federal Home Loan Bank stock | 1220 | 1143 | 7% |
| &nbsp;&nbsp;&nbsp;Other | 4044 | 817 | 395% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total interest income | 480833 | 311886 | 54% |
| **Interest Expense** |  |  |  |
| &nbsp;&nbsp;&nbsp;Deposits | 149645 | 28256 | 430% |
| &nbsp;&nbsp;&nbsp;Borrowed funds | 12637 | 5636 | 124% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total interest expense | 162282 | 33892 | 379% |
| **Net Interest Income** | 318551 | 277994 | 15% |
| &nbsp;&nbsp;&nbsp;Provision for credit losses | 17295 | 5012 | 245% |
| **Net Interest Income After Provision for Credit Losses** | 301256 | 272982 | 10% |
| **Noninterest Income** |  |  |  |
| &nbsp;&nbsp;&nbsp;Gain on sale of loans | 64150 | 111185 | -42% |
| &nbsp;&nbsp;&nbsp;Loan servicing fees, net | 30198 | 16373 | 84% |
| &nbsp;&nbsp;&nbsp;Mortgage warehouse fees | 5394 | 12396 | -56% |
| &nbsp;&nbsp;&nbsp;Gains on sale of investments available for sale <sup>(1)</sup> |  | 191 | -100% |
| &nbsp;&nbsp;&nbsp;Syndication and asset management fees | 9493 | 6507 | 46% |
| &nbsp;&nbsp;&nbsp;Other income | 16701 | 10681 | 56% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total noninterest income | 125936 | 157333 | -20% |
| **Noninterest Expense** |  |  |  |
| &nbsp;&nbsp;&nbsp;Salaries and employee benefits | 89085 | 85727 | 4% |
| &nbsp;&nbsp;&nbsp;Loan expenses | 4703 | 7657 | -39% |
| &nbsp;&nbsp;&nbsp;Occupancy and equipment | 8169 | 7365 | 11% |
| &nbsp;&nbsp;&nbsp;Professional fees | 9065 | 5427 | 67% |
| &nbsp;&nbsp;&nbsp;Deposit insurance expense | 3463 | 2691 | 29% |
| &nbsp;&nbsp;&nbsp;Technology expense | 5282 | 4200 | 26% |
| &nbsp;&nbsp;&nbsp;Other expense | 16283 | 12318 | 32% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total noninterest expense | 136050 | 125385 | 9% |
| **Income Before Income Taxes** | 291142 | 304930 | -5% |
| Provision for income taxes <sup>(2)</sup> | 71421 | 77826 | -8% |
| **Net Income** | $219721 | $227104 | -3% |
| &nbsp;&nbsp;&nbsp;Dividends on preferred stock | (25983) | (20873) | 24% |
| **Net Income Allocated to Common Shareholders** | $193738 | $206231 | -6% |
| **Basic Earnings Per Share** | $4.49 | $4.78 | -6% |
| **Diluted Earnings Per Share** | $4.47 | $4.76 | -6% |
| **Weighted-Average Shares Outstanding** |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic | 43164477 | 43172078 |  |
| &nbsp;&nbsp;&nbsp;Diluted | 43316904 | 43325303 |  |

---

<sup>(1)</sup> Includes $0 and $191 respectively, related to accumulated other comprehensive earnings reclassifications.

<sup>(2)</sup> Includes $0 and $(46) respectively, related to income tax (expense)/benefit for reclassification items.

**Key Operating Results**

(Unaudited)

($ in thousands, except share data)

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Three Months Ended** | **Change** | **Change** | **Change** |  |
|  | **December 31,<br> 2022** | **September 30,<br> 2022** | **December 31,<br> 2021** | **4Q22** **<br> vs. 3Q22** |  | **4Q22** **<br> vs. 4Q21** |  |
| Noninterest expense | $37109 | $34951 | $37646 | 6 | % | -1 | % |
| Net interest income (before provision for credit losses) | 95410 | 85385 | 72743 | 12 | % | 31 | % |
| Noninterest income | 22982 | 29186 | 40271 | -21 | % | -43 | % |
| Total income | $118392 | $114571 | $113014 | 3 | % | 5 | % |
| **Efficiency ratio** | 31.34% | 30.51% | 33.31% | 83 | bps | (197 |)bps |
| Average assets | $12457893 | $11437805 | $10945026 | 9 | % | 14 | % |
| Net income | 57156 | 58488 | 55201 | -2 | % | 4 | % |
| Return on average assets before annualizing | 0.46% | 0.51% | 0.50% |  |  |  |  |
| Annualization factor | 4.00 | 4.00 | 4.00 |  |  |  |  |
| **Return on average assets** | 1.84% | 2.05% | 2.02% | (21 |)bps | (18 |)bps |
| **Return on average tangible common shareholders' equity (1)** | 20.81% | 23.92% | 26.04% | (311 |)bps | (523 |)bps |
| **Tangible book value per common share (1)** | $21.88 | $20.78 | $17.96 | 5 | % | 22 | % |
| **Tangible common shareholders' equity/tangible assets (1)** | 7.49% | 7.49% | 6.89% | - | bps | 60 | bps |
| **Consolidated ratios** |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Total capital/risk-weighted assets<sup>(2)</sup> | 12.0% | 12.5% | N/A |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Tier I capital/risk-weighted assets<sup>(2)</sup> | 11.6% | 12.1% | N/A |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Common Equity Tier I capital/risk-weighted assets<sup>(2)</sup> | 7.6% | 7.8% | N/A |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Tier I capital/average assets<sup>(2)</sup> | 11.7% | 12.3% | 10.4% |  |  |  |  |

---

(1) Non-GAAP financial measure - see "Reconciliation of Non-GAAP Measures" below:

(2) As defined by regulatory agencies; December 31, 2022 shown as estimates and prior periods shown as reported.

Certain non-GAAP financial measures provide useful information to management and investors that is supplementary to the company's financial condition, results of operations and cash flows computed in accordance with GAAP; however, they do have a number of limitations. As such, the reader should not view these disclosures as a substitute for results determined in accordance with GAAP, and they are not necessarily comparable to non-GAAP financial measures that other companies use. A reconciliation of GAAP to non-GAAP financial measures is below. Net Income Available to Common Shareholders excludes preferred stock. Tangible common equity is calculated by excluding the balance of goodwill and other intangible assets and preferred stock from the calculation of total assets. Tangible Assets is calculated by excluding the balance of goodwill and intangible assets. Tangible book value per share is calculated by dividing tangible common equity by the number of shares outstanding.

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Three Months Ended** | **Change** | **Change** | **Change** |  |
|  | **December 31,<br> 2022** | **September 30,<br> 2022** | **December 31,<br> 2021** | **4Q22** **<br> vs. 3Q22** |  | **4Q22** **<br> vs. 4Q21** |  |
| Net income | $57156 | $58488 | $55201 | -2 | % | 4 | % |
| Less: preferred stock dividends | (8797) | (5729) | (5728) | 54 | % | 54 | % |
| Net income available to common shareholders | $48359 | $52759 | $49473 | -8 | % | -2 | % |
| Average shareholders' equity | $1445995 | $1267160 | $1139714 | 14 | % | 27 | % |
| Less: average goodwill & intangibles | (17094) | (17228) | (17626) | -1 | % | -3 | % |
| Less: average preferred stock | (499529) | (367726) | (362149) | 36 | % | 38 | % |
| Average tangible common shareholders' equity | $929372 | $882206 | $759939 | 5 | % | 22 | % |
| Annualization factor | 4.00 | 4.00 | 4.00 |  |  |  |  |
| Return on average tangible common shareholders' equity | 20.81% | 23.92% | 26.04% | (311 |)bps | (523 |)bps |
| Total equity | $1459739 | $1412590 | $1155409 | 3 | % | 26 | % |
| Less: goodwill and intangibles | (17031) | (17152) | (17552) | -1 | % | -3 | % |
| Less: preferred stock | (499608) | (499520) | (362149) |  |  | 38 | % |
| Tangible common shareholders' equity | $943100 | $895918 | $775708 | 5 | % | 22 | % |
| Assets | $12615227 | $11978722 | $11278638 | 5 | % | 12 | % |
| Less: goodwill and intangibles | (17031) | (17152) | (17552) | -1 | % | -3 | % |
| Tangible assets | $12598196 | $11961570 | $11261086 | 5 | % | 12 | % |
| Ending common shares | 43113127 | 43109578 | 43180079 |  |  |  |  |
| Tangible book value per common share | $21.88 | $20.78 | $17.96 | 5 | % | 22 | % |
| Tangible common shareholders' equity/tangible assets | 7.49% | 7.49% | 6.89% | - | bps | 60 | bps |

---

**Key Operating Results**

(Unaudited)

($ in thousands, except share data)

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Twelve Months Ended** | **Twelve Months Ended** | |  |
|  | **December 31,**<br>**2022** | **December 31,**<br>**2021** |<br>**Change** |  |
| Noninterest expense | $136050 | $125385 | 9 | % |
| Net interest income (before provision for credit losses) | 318551 | 277994 | 15 | % |
| Noninterest income | 125936 | 157333 | -20 | % |
| Total income | $444487 | $435327 | 2 | % |
| **Efficiency ratio** | 30.61% | 28.80% | 181 | bps |
| Average assets | $11044889 | $10188953 | 8 | % |
| Net income | 219721 | 227104 | -3 | % |
| Return on average assets before annualizing | 1.99% | 2.23% |  |  |
| Annualization factor | 1.00 | 1.00 |  |  |
| **Return on average assets** | 1.99% | 2.23% | (24 |)bps |
| **Return on average tangible common shareholders' equity (1)** | 22.50% | 30.10% | (760 |)bps |
| **Tangible book value per common share (1)** | $21.88 | $17.96 | 22 | % |
| **Tangible common shareholders' equity/tangible assets (1)** | 7.49% | 6.89% | 60 | bps |

---

(1) Non-GAAP financial measure - see "Reconciliation of Non-GAAP Measures" below:

Certain non-GAAP financial measures provide useful information to management and investors that is supplementary to the company's financial condition, results of operations and cash flows computed in accordance with GAAP; however, they do have a number of limitations. As such, the reader should not view these disclosures as a substitute for results determined in accordance with GAAP, and they are not necessarily comparable to non-GAAP financial measures that other companies use. A reconciliation of GAAP to non-GAAP financial measures is below. Net Income Available to Common Shareholders excludes preferred stock. Tangible common equity is calculated by excluding the balance of goodwill and other intangible assets and preferred stock from the calculation of total assets. Tangible Assets is calculated by excluding the balance of goodwill and intangible assets. Tangible book value per share is calculated by dividing tangible common equity by the number of shares outstanding.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Twelve Months Ended** | **Twelve Months Ended** | |  |
|  | **December 31,**<br>**2022** | **December 31,**<br>**2021** |<br>**Change** |  |
| Net income | $219721 | $227104 | -3 | % |
| Less: preferred stock dividends | (25983) | (20873) | 24 | % |
| Net income available to common shareholders | $193738 | $206231 | -6 | % |
| Average shareholders' equity | $1276443 | $1028834 | 24 | % |
| Less: average goodwill & intangibles | (17293) | (17841) | -3 | % |
| Less: average preferred stock | (398182) | (325904) | 22 | % |
| Average tangible common shareholders' equity | $860968 | $685089 | 26 | % |
| Annualization factor | 1.00 | 1.00 |  |  |
| Return on average tangible common shareholders' equity | 22.50% | 30.10% | (760 |)bps |
| Total equity | $1459739 | $1155409 | 26 | % |
| Less: goodwill and intangibles | (17031) | (17552) | -3 | % |
| Less: preferred stock | (499608) | (362149) | 38 | % |
| Tangible common shareholders' equity | $943100 | $775708 | 22 | % |
| Assets | $12615227 | $11278638 | 12 | % |
| Less: goodwill and intangibles | (17031) | (17552) | -3 | % |
| Tangible assets | $12598196 | $11261086 | 12 | % |
| Ending common shares | 43113127 | 43180079 |  |  |
| Tangible book value per common share | $21.88 | $17.96 | 22 | % |
| Tangible common shareholders' equity/tangible assets | 7.49% | 6.89% | 60 | bps |

---

**Merchants Bancorp**

**Average Balance Analysis**

**($ in thousands)**

**(Unaudited)**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | Three Months Ended | Three Months Ended | Three Months Ended | Three Months Ended | Three Months Ended | Three Months Ended | Three Months Ended | Three Months Ended | Three Months Ended |
|  | December 31, 2022 | December 31, 2022 | December 31, 2022 | September 30, 2022 | September 30, 2022 | September 30, 2022 | December 31, 2021 | December 31, 2021 | December 31, 2021 |
|  | Average<br>Balance |<br>Interest | Yield/<br>Rate | Average<br>Balance |<br>Interest | Yield/<br>Rate | Average<br>Balance |<br>Interest | Yield/<br>Rate |
| **Assets:** |  |  |  |  |  |  |  |  |  |
| Interest-bearing deposits, and other | $225274 | $2090 | 3.68% | $211653 | $1394 | 2.61% | $698263 | $438 | 0.25% |
| Securities available for sale - taxable | 323510 | 704 | 0.86% | 331796 | 485 | 0.58% | 308581 | 1007 | 1.29% |
| Securities available for sale - tax exempt |  |  |  |  |  |  | 1204 | 9 | 2.97% |
| Securities held to maturity | 1002446 | 11412 | 4.52% | 98363 | 970 | 3.91% |  |  |  |
| Mortgage loans in process of securitization | 234248 | 2551 | 4.32% | 235230 | 2162 | 3.65% | 621946 | 4018 | 2.56% |
| Loans and loans held for sale | 10299795 | 164682 | 6.34% | 10245294 | 129101 | 5.00% | 9064880 | 77113 | 3.37% |
| &nbsp;&nbsp;&nbsp;Total interest-earning assets | 12085273 | 181439 | 5.96% | 11122336 | 134112 | 4.78% | 10694874 | 82585 | 3.06% |
| Allowance for credit losses on loans | (40339) |  |  | (39325) |  |  | (29801) |  |  |
| Noninterest-earning assets | 412959 |  |  | 354794 |  |  | 279953 |  |  |
| Total assets | $12457893 |  |  | $11437805 |  |  | $10945026 |  |  |
| **Liabilities & Shareholders' Equity:** |  |  |  |  |  |  |  |  |  |
| Interest-bearing checking | 4520785 | 37929 | 3.33% | 4207217 | 21980 | 2.07% | 4325991 | 2094 | 0.19% |
| Savings deposits | 252787 | 304 | 0.48% | 239262 | 162 | 0.27% | 223912 | 35 | 0.06% |
| Money market | 2745904 | 23958 | 3.46% | 2523315 | 13094 | 2.06% | 2528453 | 5018 | 0.79% |
| Certificates of deposit | 2474427 | 18871 | 3.03% | 2030152 | 9766 | 1.91% | 1220392 | 1345 | 0.44% |
| &nbsp;&nbsp;&nbsp;Total interest-bearing deposits | 9993903 | 81062 | 3.22% | 8999946 | 45002 | 1.98% | 8298748 | 8492 | 0.41% |
| Borrowings | 451467 | 4967 | 4.36% | 588582 | 3725 | 2.51% | 620173 | 1350 | 0.86% |
| &nbsp;&nbsp;&nbsp;Total interest-bearing liabilities | 10445370 | 86029 | 3.27% | 9588528 | 48727 | 2.02% | 8918921 | 9842 | 0.44% |
| Noninterest-bearing deposits | 419008 |  |  | 474925 |  |  | 795704 |  |  |
| Noninterest-bearing liabilities | 147520 |  |  | 107192 |  |  | 90687 |  |  |
| &nbsp;&nbsp;&nbsp;Total liabilities | 11011898 |  |  | 10170645 |  |  | 9805312 |  |  |
| &nbsp;&nbsp;&nbsp;Shareholders' equity | 1445995 |  |  | 1267160 |  |  | 1139714 |  |  |
| Total liabilities and shareholders' equity | $12457893 |  |  | $11437805 |  |  | $10945026 |  |  |
| **Net interest income** |  | $95410 |  |  | $85385 |  |  | $72743 |  |
| **Net interest spread** |  |  | 2.69% |  |  | 2.77% |  |  | 2.62% |
| **Net interest-earning assets** | $1639903 |  |  | $1533808 |  |  | $1775953 |  |  |
| **Net interest margin** |  |  | 3.13% |  |  | 3.05% |  |  | 2.70% |
| **Average interest-earning assets to average interest-bearing liabilities** |  |  | 115.70% |  |  | 116.00% |  |  | 119.91% |

---

**Supplemental Results**

(Unaudited)

($ in thousands)

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Net Income** | **Net Income** | **Net Income** | **Net Income** | **Net Income** |
|  | **Three Months Ended** | **Three Months Ended** | **Three Months Ended** | **Twelve Months Ended** | **Twelve Months Ended** |
|  | | | | **December 31,** | **December 31,** |
|  | **December 31,**<br>**2022** | **September 30,**<br>**2022** | **December 31,**<br>**2021** | **2022** | **2021** |
| **<u>Segment</u>** |  |  |  |  |  |
| Multi-family Mortgage Banking | $10228 | $13366 | $14124 | $54642 | $51504 |
| Mortgage Warehousing | 11776 | 11801 | 21311 | 48604 | 95159 |
| Banking | 40181 | 39344 | 22629 | 134221 | 90858 |
| Other | (5029) | (6023) | (2863) | (17746) | (10417) |
| Total | $57156 | $58488 | $55201 | $219721 | $227104 |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **Total Assets** | **Total Assets** | **Total Assets** |
|  | **December 31,**<br>**2022** | **September 30,**<br>**2022** | **December 31,**<br>**2021** |
| **<u>Segment</u>** |  |  |  |
| Multi-family Mortgage Banking | $351274 | $343443 | $296129 |
| Mortgage Warehousing | 2519810 | 2735278 | 3977537 |
| Banking | 9587544 | 8760416 | 6929565 |
| Other | 156599 | 139585 | 75407 |
| Total | $12615227 | $11978722 | $11278638 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Gain on Sale of Loans** | **Gain on Sale of Loans** | **Gain on Sale of Loans** | **Gain on Sale of Loans** | **Gain on Sale of Loans** |
|  | **Three Months Ended** | **Three Months Ended** | **Three Months Ended** | **Twelve Months Ended** | **Twelve Months Ended** |
|  | | | | **December 31,** | **December 31,** |
|  | **December 31,**<br>**2022** | **September 30,**<br>**2022** | **December 31,**<br>**2021** | **2022** | **2021** |
| **<u>Loan Type</u>** |  |  |  |  |  |
| Multi-family | 10241 | $12002 | $24797 | $56819 | $93350 |
| Single-family | 132 | 138 | 1086 | 1133 | 8763 |
| Small Business Association (SBA) | 894 | 1214 | 2547 | 6198 | 9072 |
| Total | $11267 | $13354 | $28430 | $64150 | $111185 |

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| | | | |
|:---|:---|:---|:---|
|  | **Loans Receivable and Loans Held for Sale** | **Loans Receivable and Loans Held for Sale** | **Loans Receivable and Loans Held for Sale** |
|  | **December 31,**<br>**2022** | **September 30,**<br>**2022** | **December 31,**<br>**2021** |
| Mortgage warehouse lines of credit | $464785 | $815084 | $781437 |
| Residential real estate | 1178401 | 1030075 | 843101 |
| Multi-family financing | 3135535 | 2766950 | 2702042 |
| Healthcare financing | 1604341 | 1429675 | 826157 |
| Commercial and commercial real estate (1) | 978661 | 810731 | 520199 |
| Agricultural production and real estate | 95651 | 91913 | 97060 |
| Consumer and margin loans | 13498 | 13696 | 12667 |
|  | 7470872 | 6958124 | 5782663 |
| &nbsp;&nbsp; Less: Allowance for credit losses on loans | 44014 | 38996 | 31344 |
| Loans receivable | $7426858 | $6919128 | $5751319 |
| Loans held for sale | 2910576 | 2844750 | 3303199 |
| Total loans, net of allowance | $10337434 | $9763878 | $9054518 |

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(1) Includes $497.0 million and $209.8 million of revolving lines of credit collateralized primarily by single-family mortgage servicing rights as of December 31, 2022 and 2021, respectively.