MERCANTILE BANK CORP (NASDAQ:MBWM) reported a significant increase in net income for the third quarter of 2025, reaching $23.8 million, or $1.46 per diluted share. This marks a 21.4% rise from the $19.6 million, or $1.22 per diluted share, recorded in the third quarter of 2024.
For the first nine months of 2025, net income totaled $65.9 million, equating to $4.06 per diluted share, an increase from $60.0 million, or $3.72 per diluted share, in the same period of 2024. Ray Reitsma, President and Chief Executive Officer, highlighted the 'robust financial performance' driven by net interest income expansion, a stable net interest margin, growth in noninterest income categories, and a notable decline in federal income tax expense.
Net revenue for Q3 2025 grew 7.6% to $62.4 million from $58.0 million in the prior-year quarter. Net interest income expanded by 7.7% to $52.0 million, compared to $48.3 million in Q3 2024. Noninterest income increased 7.5% to $10.4 million, primarily due to an approximately 11% rise in treasury management fees and a 16% increase in payroll services fees. Federal income tax expense decreased to $3.7 million from $4.9 million in Q3 2024, lowering the effective tax rate to 13.4% from 20.1%, mainly due to transferable energy tax credits and investments in tax credit structures.
As of September 30, 2025, total assets stood at $6.31 billion, up $256 million since year-end 2024. Total deposits reached $4.81 billion, an increase from $4.70 billion as of December 31, 2024, leading to a reduction in the loan-to-deposit ratio from 102% in Q3 2024 to 96%. Nonperforming assets remained low at $9.8 million, or 0.2% of total assets. Shareholders' equity increased to $658 million, up $73.1 million from December 31, 2024, and the total risk-based capital ratio improved to 14.3% from 13.9% at year-end 2024. Mercantile Bank also announced a planned partnership with Eastern Michigan Financial Corporation.
