About Mercantile Bank

Mercantile Bank Corporation operates as the holding company for Mercantile Bank of Michigan that provides commercial banking services primarily to small- to medium-sized businesses and retail banking services. The bank is a state banking company that operates under the laws of the state of Michigan, pursuant to a charter issued by the Michigan Department of Insurance and Financial Services. The company’s deposits are insured to the maximum extent permitted by law by the Federal Deposit Insurance Corporation (FDIC). The company, through its office locations, provides commercial banking services primarily to small- to medium-sized businesses and retail banking services. The company’s main office is located in Grand Rapids, and its operations are centered around the West and Central portions of Michigan. The company also has a banking office located in the metropolitan Detroit, Michigan area, as well as residential mortgage loan production offices in Midland and Petoskey, Michigan and in the Cincinnati, Ohio metropolitan area. The company makes secured and unsecured commercial, construction, mortgage and consumer loans, and accepts checking, savings and time deposits. The comopany owns automated teller machines (ATM) and video banking machines at a majority of its office locations that participate in the ACCEL/EXCHANGE and PLUS regional network systems, as well as other ATM networks throughout the country. The company also enables customers to conduct certain loan and deposit transactions by personal computer and through mobile applications. Courier service is provided to certain commercial customers, and safe deposit facilities are available at a vast majority of the company’s office locations. The company’s insurance company acquired an existing shelf insurance agency effective April 15, 2002. An Agency and Institution Agreement was entered into among the company’s insurance company, its bank and Hub International for the purpose of providing programs of mass marketed personal lines of insurance. Insurance product offerings include private passenger automobile, homeowners, personal inland marine, boat owners, recreational vehicle, dwelling fire, umbrella policies, small business and life insurance products, all of which are provided by and written through companies that have appointed Hub International as their agent. Commercial Loans: The company’s commercial lending group originates commercial loans primarily in its market areas. The company’s commercial lenders have extensive commercial lending experience, with most having at least ten years’ experience. Loans are originated for general business purposes, including working capital, accounts receivable financing, machinery and equipment acquisition, and commercial real estate financing, including new construction and land development. Single-Family Residential Real Estate Loans: The company originates single-family residential real estate loans in its market areas, generally according to secondary market underwriting standards. Single-family residential real estate loans provide borrowers with a fixed or adjustable interest rate with terms up to 30 years, with the fixed interest rate loans generally sold to various investors. The company’s bank has a home equity line of credit program. Home equity lines of credit are generally secured by either a first or second mortgage on the borrower’s primary residence. The program provides revolving credit at a rate tied to the Wall Street Journal Prime Rate. Consumer Loans: The company originates various types of consumer loans, including new and used automobile and boat loans, credit cards and overdraft protection lines of credit for its checking account customers. Consumer loans generally have shorter terms and higher interest rates and usually involve more credit risk than single-family residential real estate loans because of the type and nature of the collateral. Investment Portfolio As of December 31, 2022, the company’s investment portfolio included U.S. Government agency debt obligations; mortgage-backed securities; municipal general obligation bonds; municipal revenue bonds; and other investments. Deposits As of December 31, 2022, the company’s deposits included noninterest-bearing checking; interest-bearing checking; money market; savings; time, under $100,000; time, $100,000 and over; and out-of-area time, $100,000 and over. Regulation and Supervision The company is a registered bank holding company under the Bank Holding Company Act of 1956, as amended (the Bank Holding Company Act). As a bank holding company, the company is subject to regulation by the Board of Governors of the Federal Reserve System (the Federal Reserve Board). As a registered bank holding company under the Bank Holding Company Act, the company is required to file an annual report with the Federal Reserve Board and such additional information as the Federal Reserve Board may require. The company is also subject to periodic examinations by the Federal Reserve Board. The Bank Holding Company Act limits the activities of bank holding companies to banking and the management of banking organizations, and to certain permitted non-banking activities. The permitted non-banking activities generally include those limited activities that the Federal Reserve Board has determined, by order or regulation as of the day prior to enactment of the Gramm-Leach-Bliley Act, to be so closely related to banking as to be a proper incident to banking. On April 14, 2014, the company’s election to become a financial holding company, as permitted by the Bank Holding Company Act, as amended by Title I of the Gramm-Leach-Bliley Act, was accepted and made effective by the Federal Reserve Board. In order to maintain its status as a financial holding company, the company and its bank must satisfy statutory requirements regarding capitalization, management and compliance with the Community Reinvestment Act. As a financial holding company, the company is permitted to engage in a broader range of activities under the Bank Holding Company Act that are permitted for bank holding companies. Those expanded activities include any activity, which the Federal Reserve Board (in certain instances in consultation with the Department of the Treasury) determines, by order or by regulation, to be financial in nature or incidental to such financial activity, or to be complementary to a financial activity, and not to pose a substantial risk to the safety and soundness of depository institutions or the financial system generally. Such expanded activities that have been previously approved by the Federal Reserve Board include, among others: insuring, guaranteeing, or indemnifying against loss, harm, damage, illness, disability or death, or issuing annuities, and acting as principal, agent or broker for such purposes; providing financial, investment or economic advisory services, including advising a mutual fund; and underwriting, dealing in, or making a market in securities. With respect to the acquisition of banking organizations, the company is generally required to obtain the prior approval of the Federal Reserve Board before it can acquire all or substantially all of the assets of any bank, or acquire ownership or control of any voting shares of any bank or bank holding company, if, after the acquisition, it would own or control more than 5% of the voting shares of the bank or bank holding company. The scope of regulations and supervision of various aspects of the company’s business have expanded as a result of the adoption in July, 2010 of the Dodd-Frank Act, and may continue to expand as the result of implementing regulations being adopted by federal regulators. However, on May 24, 2018, EGRRCPA amended certain provisions of the Dodd-Frank Act to tailor them to the specific circumstances of various categories of financial institutions and transactions. The Bank Holding Company Act limits the activities of bank holding companies to banking and the management of banking organizations, and to certain permitted non-banking activities. The permitted non-banking activities generally include those limited activities that the Federal Reserve Board has determined, by order or regulation as of the day prior to enactment of the Gramm-Leach-Bliley Act, to be so closely related to banking as to be a proper incident to banking. History Mercantile Bank Corporation was founded in 1997. The company was incorporated in 1997 under the laws of the state of Michigan.