Independent Bank Corporation Reports Strong First Quarter 2026 Results
On April 23rd, Independent Bank Corporation held its conference call to discuss its first quarter 2026 results. The company reported a net income of $16.9 million, or $0.81 per diluted share, representing a 7% increase from the prior year period.
According to Brad Kessel, President and CEO, the highlights for the first quarter include a net interest margin of 3.65%, which is a three basis point increase on a linked-quarter basis, an increase in net interest income of $500,000, or 1.1% over the fourth quarter of 2025, and a return on average assets and return on average equity of 1.24% and 13.43%, respectively.
The company's balance sheet growth remained disciplined with $80.4 million in core deposit growth and just under $32 million in total loan growth, including $53.8 million or 9.9% annualized in commercial loans, reflecting continued execution of its strategic plan. Credit quality remains sound, and while geopolitical uncertainty has increased, the company has not seen a direct impact on its customers yet.
In terms of deposits, Independent Bank Corporation reported total deposits of $4.9 billion at March 31st, an increase of $80.4 million from year-end. The deposit base is comprised of 47% retail, 38% commercial, and 15% municipal.
On a linked-quarter basis, business deposits increased by $94 million, while retail deposits increased by $28 million. These were offset by a $42 million decrease in municipal deposits, primarily due to seasonality.
The company's cost of funds decreased by 13 basis points to 1.54% for the first quarter, and its total loan growth was driven by commercial loans, which grew by $53.8 million or 9.9% annualized.
According to Joel Rahn, Executive Vice President and Head of Commercial Banking, the company's residential mortgage and consumer installment loan portfolios declined by $4 million during the quarter.
The merger with HCB Financial Corp is expected to provide enhanced shareholder value, and the company remains optimistic about its opportunities and confident in its strategic plan.
