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Note 15 - Business Segment Information
 9 Months Ended
Sep. 30, 2026
Notes to Financial Statements  
Segment Reporting [Text Block]

15.  BUSINESS SEGMENT INFORMATION

 

Pursuant to Financial Accounting Standards Codification 280, Segment Reporting, operating segments represent components of an enterprise for which separate financial information is available that is regularly evaluated by the chief operating decision makers in determining how to allocate resources and assessing performance.

 

Prior to our acquisition of Eastern Michigan Financial Corporation on December 31, 2025, our chief operating decision makers, which include our Chief Executive Officer, Chief Financial Officer, and Chief Operating Officer, evaluated interest and noninterest income streams and credit losses from our various products and services, while expense activities, including interest expense and noninterest expense, were managed, and financial performance was evaluated, on a Company-wide basis. As a result, detailed profitability information for each interest and noninterest income stream was not used by our chief operating decision makers to allocate resources or in assessing performance. Rather, our chief operating decision makers used consolidated net income to assess performance by comparing it to and monitoring against budgeted and prior-year results. This information was used to manage resources to drive business and net income growth, including investment in key strategic priorities, as well as determine our ability to return capital to shareholders.

 

Subsequent to our acquisition of Eastern Michigan Financial Corporation on December 31, 2025, our chief operating decision makers now evaluate interest and noninterest income streams, credit losses, expense activities, and financial performance through our two wholly owned subsidiary banks, Mercantile Bank and Eastern Michigan Bank. Each of these operating segments offer similar products and services, but are managed separately due to different pricing, product demand, and consumer markets. Both segments derive interest and noninterest income through their banking products and services and investment securities. All of our income relates to our operations in the United States. Our chief operating decision makers use subsidiary level net income to assess performance by comparing it to and monitoring against budgeted and prior-year results. This information is used to manage resources to drive business and net income growth, including investment in key strategic priorities, as well as determine our ability to return capital to shareholders.

 

 

Selected financial information on our business segments is presented as follows as of and for the nine months ended September 30, 2026:

 

(Dollars in thousands)

 

Mercantile Bank

  

Eastern Michigan Bank

  

All Other

  

Intercompany Eliminations

  

Consolidated Total

 
                     

Interest income

 $244,702  $19,315  $3,196  $(4,822) $262,391 

Interest expense

  82,268   1,771   9,023   (4,731)  88,331 

Net interest income

  162,434   17,544   (5,827)  (91)  174,060 

Provision for credit losses

  (2,700)  (200)  -   -   (2,900)

Net interest income after provision for credit losses

  165,134   17,744   (5,827)  (91)  176,960 

Noninterest income

  33,637   1,584   58,716   (58,500)  35,437 

Noninterest expense

  106,948   12,101   5,934   -   124,983 

Income before federal income tax expense

  91,823   7,227   46,955   (58,591)  87,414 

Federal income tax expense

  15,794   1,482   (2,547)  -   14,729 

Net income

 $76,029  $5,745  $49,502  $(58,591) $72,685 
                     

Goodwill

 $32,171  $24,217  $17,301  $-  $73,689 

Core deposit intangible, net

  -   16,442   -   -   16,442 

Total assets

  6,529,958   587,643   1,051,866   (1,006,599)  7,162,868