Company Quick10K Filing
Merchants Bancorp
Price17.29 EPS2
Shares29 P/E8
MCap497 P/FCF-0
Net Debt-205 EBIT169
TEV292 TEV/EBIT2
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-06-30 Filed 2020-08-10
10-Q 2020-03-31 Filed 2020-05-04
10-K 2019-12-31 Filed 2020-03-16
10-Q 2019-09-30 Filed 2019-11-08
10-Q 2019-06-30 Filed 2019-08-09
10-Q 2019-03-31 Filed 2019-05-10
10-K 2018-12-31 Filed 2019-03-15
10-Q 2018-09-30 Filed 2018-11-14
10-Q 2018-06-30 Filed 2018-08-14
10-Q 2018-03-31 Filed 2018-05-15
10-K 2017-12-31 Filed 2018-03-28
10-Q 2017-09-30 Filed 2017-12-07
8-K 2020-08-20 Other Events, Exhibits
8-K 2020-07-28 Earnings, Exhibits
8-K 2020-05-21
8-K 2020-04-23
8-K 2020-02-20
8-K 2020-01-30
8-K 2020-01-22
8-K 2019-12-19
8-K 2019-11-20
8-K 2019-10-30
8-K 2019-08-19
8-K 2019-08-19
8-K 2019-08-12
8-K 2019-07-30
8-K 2019-06-27
8-K 2019-05-16
8-K 2019-04-30
8-K 2019-03-28
8-K 2019-03-21
8-K 2019-03-15
8-K 2019-02-21
8-K 2019-01-30
8-K 2019-01-08
8-K 2018-12-06
8-K 2018-11-14
8-K 2018-10-30
8-K 2018-10-01
8-K 2018-08-16
8-K 2018-07-30
8-K 2018-06-13
8-K 2018-06-05
8-K 2018-04-30
8-K 2018-04-13
8-K 2018-04-13
8-K 2018-02-22
8-K 2018-02-08
8-K 2018-01-02

MBIN 10Q Quarterly Report

Part I - Financial Information
Item 1. Financial Statements
Note 1: Basis of Presentation
Note 2: Securities Available for Sale
Note 3: Mortgage Loans in Process of Securitization
Note 4: Loans and Allowance for Loan Losses
Note 5: Borrowings
Note 6: Regulatory Matters
Note 7: Derivative Financial Instruments
Note 8: Disclosures About Fair Value of Assets and Liabilities
Note 9: Earnings per Share
Note 10: Share - Based Payment Plans
Note 11: Segment Information
Note 12: Preferred Stock Offerings
Note 13: Recent Accounting Pronouncements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3 Quantitative and Qualitative Disclosures About Market Risk
Item 4 Controls and Procedures
Part II
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
EX-31.1 tmb-20200630xex31d1.htm
EX-31.2 tmb-20200630xex31d2.htm
EX-32 tmb-20200630xex32.htm

Merchants Bancorp Earnings 2020-06-30

Balance SheetIncome StatementCash Flow

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Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-Q

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended

June 30, 2020

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to _______________

Commission File No. 001-38258

MERCHANTS BANCORP

(Exact name of registrant as specified in its charter)

Indiana

    

20-5747400

(State or other jurisdiction of

(I.R.S. Employer

incorporation or organization)

Identification Number)

410 Monon Blvd. Carmel, Indiana

46032

(Address of principal executive office)

(Zip Code)

(317) 569-7420

(Registrant’s telephone number, including area code)

N/A

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

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.

Yes    No 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes   No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

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.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.).
Yes
    No 

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

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, without par value

Series A Preferred Stock, without par value

Depositary Shares, each representing a 1/40th interest in a share of Series B Preferred Stock, without par value

MBIN

MBINP

MBINO

NASDAQ

NASDAQ

NASDAQ

As of August 3, 2020, the latest practicable date, 28,745,614 shares of the registrant’s common stock, without par value, were issued and outstanding.

Table of Contents

Merchants Bancorp

Index to Quarterly Report on Form 10-Q

PART I – FINANCIAL INFORMATION

Item 1 Interim Financial Statements (Unaudited)

Condensed Consolidated Balance Sheets as of June 30, 2020 and December 31, 2019

3

Condensed Consolidated Statements of Income for the Three and Six Months Ended June 30, 2020 and 2019

4

Condensed Consolidated Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2020 and 2019

5

Condensed Consolidated Statements of Shareholders’ Equity for the Six Months Ended June 30, 2020 and 2019

6

Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2020 and 2019

7

Notes to Condensed Consolidated Financial Statements

8

Item 2 Management’s Discussion and Analysis of Financial Condition and Results of Operations

36

Item 3 Quantitative and Qualitative Disclosures About Market Risk

55

Item 4 Controls and Procedures

55

PART II – OTHER INFORMATION

56

Item 1 Legal Proceedings

56

Item 1A Risk Factors

56

Item 2 Unregistered Sales of Equity Securities and Use of Proceeds

56

Item 3 Defaults Upon Senior Securities

56

Item 4 Mine Safety Disclosures

56

Item 5 Other Information

56

Item 6 Exhibits

57

SIGNATURES

58

2

Table of Contents

Part I – Financial Information

Item 1. Financial Statements

Merchants Bancorp

Condensed Consolidated Balance Sheets

June 30, 2020 (Unaudited) and December 31, 2019

(In thousands, except share data)

June 30, 

December 31, 

    

2020

    

2019

Assets

 

  

 

  

Cash and due from banks

$

13,830

$

13,909

Interest-earning demand accounts

 

389,357

 

492,800

Cash and cash equivalents

 

403,187

 

506,709

Securities purchased under agreements to resell

 

6,651

 

6,723

Mortgage loans in process of securitization

 

518,788

 

269,891

Available for sale securities

 

259,656

 

290,243

Federal Home Loan Bank (FHLB) stock

 

53,224

 

20,369

Loans held for sale (includes $42,000 and $19,592, respectively at fair value)

 

3,877,769

 

2,093,789

Loans receivable, net of allowance for loan losses of $20,497 and $15,842, respectively

 

4,133,315

 

3,012,468

Premises and equipment, net

 

29,362

 

29,274

Mortgage servicing rights

 

72,889

 

74,387

Interest receivable

 

18,574

 

18,359

Goodwill

 

15,845

 

15,845

Intangible assets, net

 

3,038

 

3,799

Other assets and receivables

 

47,102

 

30,072

Total assets

$

9,439,400

$

6,371,928

Liabilities and Shareholders' Equity

 

 

Liabilities

 

  

 

  

Deposits

 

  

 

  

Noninterest-bearing

$

601,265

$

272,037

Interest-bearing

 

6,307,363

 

5,206,038

Total deposits

 

6,908,628

 

5,478,075

Borrowings

 

1,761,113

 

181,439

Other liabilities

 

61,461

 

58,686

Total liabilities

 

8,731,202

 

5,718,200

Commitments and Contingencies

 

  

 

  

Shareholders' Equity

 

  

 

  

Common stock, without par value

 

  

 

  

Authorized - 50,000,000 shares

 

 

  

Issued and outstanding - 28,745,614 shares at June 30, 2020 and 28,706,438 shares at December 31, 2019

 

135,949

 

135,640

Preferred stock, without par value - 5,000,000 total shares authorized

8% Preferred stock - $1,000 per share liquidation preference

 

 

Authorized - 50,000 shares

 

 

Issued and outstanding - 41,625 shares

 

41,581

 

41,581

7% Series A Preferred stock - $25 per share liquidation preference

 

 

Authorized - 3,500,000 shares

 

 

Issued and outstanding - 2,081,800 shares

 

50,221

 

50,221

6% Series B Preferred stock - $1,000 per share liquidation preference

 

 

Authorized - 125,000 shares

 

 

Issued and outstanding - 125,000 shares (equivalent to 5,000,000 depositary shares)

 

120,844

 

120,844

Retained earnings

 

358,895

 

304,984

Accumulated other comprehensive income

 

708

 

458

Total shareholders' equity

 

708,198

 

653,728

Total liabilities and shareholders' equity

$

9,439,400

$

6,371,928

See notes to condensed consolidated financial statements.

3

Table of Contents

Merchants Bancorp

Condensed Consolidated Statements of Income (Unaudited)

For the Three and Six Months Ended June 30, 2020 and 2019

(In thousands, except share data)

Three Months Ended

Six Months Ended

June 30, 

June 30, 

    

2020

    

2019

    

2020

    

2019

Interest Income

 

  

 

  

 

  

Loans

$

63,979

$

42,365

$

117,543

$

76,820

Mortgage loans in process of securitization

 

2,534

 

1,967

 

5,330

 

3,012

Investment securities:

 

 

 

  

 

  

Available for sale - taxable

 

972

 

1,477

 

2,294

 

3,028

Available for sale - tax exempt

38

53

75

149

Federal Home Loan Bank stock

 

447

 

257

 

686

 

480

Other

 

234

 

2,642

 

2,693

 

4,946

Total interest income

 

68,204

 

48,761

 

128,621

 

88,435

Interest Expense

 

  

 

  

 

  

 

  

Deposits

 

15,398

 

19,344

 

36,028

 

33,571

Borrowed funds

 

1,572

 

1,495

 

3,006

 

2,811

Total interest expense

 

16,970

 

20,839

 

39,034

 

36,382

Net Interest Income

 

51,234

 

27,922

 

89,587

 

52,053

Provision for loan losses

 

1,745

 

105

 

4,743

 

754

Net Interest Income After Provision for Loan Losses

 

49,489

 

27,817

 

84,844

 

51,299

Noninterest Income

 

  

 

  

 

  

 

  

Gain on sale of loans

 

17,084

 

9,104

 

38,250

 

11,747

Loan servicing fees, net

 

1,597

 

(1,561)

 

(4,227)

 

(1,908)

Mortgage warehouse fees

 

5,475

 

1,138

 

8,221

 

1,891

Gains/(losses) on sale of investments available for sale (includes $0, $(3), $0, and $124, respectively, related to accumulated other comprehensive earnings reclassifications)

 

 

(3)

 

 

124

Other income

 

2,032

 

1,192

 

3,846

 

1,680

Total noninterest income

 

26,188

 

9,870

 

46,090

 

13,534

Noninterest Expense

 

  

 

  

 

  

 

  

Salaries and employee benefits

 

11,828

 

9,965

 

26,068

 

18,532

Loan expenses

 

2,039

 

1,345

 

3,203

 

2,279

Occupancy and equipment

 

1,383

 

946

 

2,875

 

1,822

Professional fees

 

726

 

453

 

1,295

 

992

Deposit insurance expense

 

1,851

 

218

 

3,637

 

495

Technology expense

 

716

 

629

 

1,326

 

1,101

Other expense

 

1,739

 

2,364

 

4,171

 

3,734

Total noninterest expense

 

20,282

 

15,920

 

42,575

 

28,955

Income Before Income Taxes

 

55,395

 

21,767

 

88,359

 

35,878

Provision for income taxes (includes $0, $1, $0 and $(31), respectively, related to income tax (expense)/benefit for reclassification items)

 

14,233

 

5,328

 

22,614

 

8,869

Net Income

$

41,162

$

16,439

$

65,745

$

27,009

Dividends on preferred stock

(3,619)

(1,743)

(7,237)

(2,576)

Net Income Allocated to Common Shareholders

37,543

14,696

58,508

24,433

Basic Earnings Per Share

$

1.31

$

0.51

$

2.04

$

0.85

Diluted Earnings Per Share

$

1.31

$

0.51

$

2.03

$

0.85

Weighted-Average Shares Outstanding

 

  

 

  

 

  

 

  

Basic

 

28,743,894

 

28,705,313

 

28,739,263

 

28,703,790

Diluted

 

28,762,349

 

28,746,297

 

28,760,880

 

28,741,877

See notes to condensed consolidated financial statements.

4

Table of Contents

Merchants Bancorp

Condensed Consolidated Statements of Comprehensive Income (Unaudited)

For the Three and Six Months Ended June 30, 2020 and 2019

(In thousands)

Three Months Ended

Six Months Ended

June 30, 

June 30, 

    

2020

    

2019

    

2020

    

2019

    

Net Income

$

41,162

$

16,439

$

65,745

$

27,009

Other Comprehensive Income (Loss):

 

  

 

 

  

 

  

Net change in unrealized gains/(losses) on investment securities available for sale, net of tax (expense)/benefits of $83, $(153), $(69), and $(345), respectively

 

(218)

 

484

 

250

 

1,043

Less: Reclassification adjustment for gains/(losses) included in net income, net of tax (expense)/benefits of $0, $1, $0, and $(31), respectively

 

 

(2)

 

 

93

Other comprehensive income (loss) for the period

 

(218)

 

486

 

250

 

950

Comprehensive Income

$

40,944

$

16,925

$

65,995

$

27,959

See notes to condensed consolidated financial statements.

5

Table of Contents

Merchants Bancorp

Condensed Consolidated Statement of Shareholders’ Equity (Unaudited)

For the Six Months Ended June 30, 2020

Accumulated

Other

Common Stock

8% Preferred Stock

7% Preferred Stock

6% Preferred Stock

Retained

Comprehensive

    

Shares

    

Amount

    

Shares

    

Amount

    

Shares

    

Amount

    

Shares

    

Amount

    

Earnings

    

Income

    

Total

Balance, January 1, 2020

 

28,706,438

$

135,640

 

41,625

$

41,581

 

2,081,800

$

50,221

125,000

$

120,844

$

304,984

$

458

$

653,728

Net income

 

 

 

 

 

 

 

 

24,583

 

 

24,583

Shares issued for stock compensation plans, net of taxes withheld to satisfy employee tax obligations

 

36,046

 

106

 

 

 

 

 

 

 

 

106

Dividends on 8% preferred stock, $80.00 per share, annually

 

 

 

 

 

 

 

 

(833)

 

 

(833)

Dividends on 7% preferred stock, $1.75 per share, annually

 

 

 

 

 

 

 

 

(910)

 

 

(910)

Dividends on 6% preferred stock, $60.00 per share, annually

 

 

 

 

 

 

 

 

(1,875)

 

 

(1,875)

Dividends on common stock, $0.32 per share, annually

 

 

 

 

 

 

 

 

(2,298)

 

 

(2,298)

Other comprehensive income

 

 

 

 

 

 

 

 

 

468

 

468

Balance, March 31, 2020

 

28,742,484

$

135,746

 

41,625

$

41,581

 

2,081,800

$

50,221

125,000

$

120,844

$

323,651

$

926

$

672,969

Net income

 

 

 

 

 

 

 

 

41,162

 

 

41,162

Shares issued for stock compensation plans

 

3,130

 

203

 

 

 

 

 

 

 

 

203

Dividends on 8% preferred stock, $80.00 per share, annually

 

 

 

 

 

 

 

 

(833)

 

 

(833)

Dividends on 7% preferred stock, $1.75 per share, annually

 

 

 

 

 

 

 

 

(911)

 

 

(911)

Dividends on 6% preferred stock, $60.00 per share, annually

 

 

 

 

 

 

 

(1,875)

 

 

(1,875)

Dividends on common stock, $0.32 per share, annually

 

 

 

 

 

 

 

 

(2,299)

 

 

(2,299)

Other comprehensive income

 

 

 

 

 

 

 

 

 

(218)

 

(218)

Balance, June 30, 2020

 

28,745,614

$

135,949

 

41,625

$

41,581

 

2,081,800

$

50,221

125,000

$

120,844

$

358,895

$

708

$

708,198

Merchants Bancorp

Condensed Consolidated Statement of Shareholders’ Equity (Unaudited)

For the Six Months Ended June 30, 2019

(In thousands, except share data)

Accumulated

Other

Common Stock

8% Preferred Stock

7% Preferred Stock

6% Preferred Stock

Retained

Comprehensive

    

Shares

    

Amount

    

Shares

    

Amount

    

Shares

    

Amount

    

Shares

    

Amount

    

Earnings

    

Income (Loss)

    

Total

Balance, January 1, 2019

 

28,694,036

$

135,057