MBIN

This story was originally published on CRE Daily. Join 70,000+ commercial real estate professionals getting daily news, market insights, and industry analysis delivered straight to their inbox with the free CRE Daily newsletter. Q2 2026 earnings show major differences among community banks with multifamily exposure, influenced by risk strategy and geography. Banks with similar multifamily concentrations produced sharply different results, highlighting the limits of concentration as a risk metric. Outcomes in New York rent-regulated multifamily underline the outsized impact of local policy and underwriting discipline on loan performance. Second-quarter results from community banks with large multifamily portfolios reveal sharp performance differences. Those gaps also stand out against larger super-regional banks. Trepp’s Q2 review shows banks with similar balance sheets followed very different strategies. Merchants Bancorp continued expanding its multifamily portfolio. Mechanics Bancorp kept reducing its exposure. Trepp and CRE analysts say strategy and risk appetite matter more than loan concentration alone. Business models, risk transfer, and regulation now shape performance more than portfolio size. Government policies also influenced results this quarter. Trepp says income-based programs squeezed margins, while supply-focused federal programs supported selected lenders. Meanwhile, bank mergers reduced the number of community lenders. As a result, isolated losses now carry greater weight across the sector. Trepp reviewed 10 banks with meaningful multifamily exposure. Results and lending pipelines varied widely. Merchants Bancorp increased net income by 106%. It also posted its 30th consecutive record quarter for tangible book value. The bank expanded its multifamily portfolio by 10% to $5.86B. That portfolio now represents 47% of total loans receivable. Meanwhile, Bank of California reported a $251.3M loss. It sold $2.3B of lower-yielding securities and started selling $827M of CRE and multifamily construction loans. Most banks reported their strongest net interest margins in years. However, six banks continued reducing multifamily exposure. Legacy thrifts tied to New York’s rent-stabilized market led that trend. Only Merchants and Columbia expanded their portfolios. Dime is lowering multifamily exposure toward 25% of its portfolio. Kearny continues shifting toward C&I and construction lending. Mechanics kept its multifamily portfolio flat through a conservative runoff strategy. It also maintained strict underwriting and avoided nondepository exposure. These approaches produced very different risk and return profiles across similar banks. Exposure alone does not explain performance differences. Trepp says ConnectOne, with large New York rent-stabilized holdings, recorded a $13.8M charge-off on troubled loans. Reserve releases partly offset those losses. The bank is also considering a bulk sale of its rent-stabilized portfolio. Merchants uses sophisticated risk distribution strategies. Criticized loans and provisions declined sharply. However, its non-performing loan ratio remains 1.67%. Mechanics follows a hold-to-maturity model with low leverage. It has not reported multifamily losses since 2016. Loan performance also varies by financing structure. Trepp reports agency multifamily special servicing rates at 0.36%. Conduit CMBS reached 2.06%, while CRE CLOs hit 3.58%. Those figures show multifamily risk depends on loan structure and investment strategy. Geography also shapes outcomes. Legacy New York thrifts face mounting pressure from the 2019 rent law. A citywide rent freeze begins for most leases in October 2026. Similar regulatory pressures have also reshaped commercial property performance, especially for retail landlords navigating New York’s evolving rent rules. That policy has already sparked litigation from affected banks. Meanwhile, Los Angeles lenders like Mechanics continue reporting low non-performing loan rates through conservative underwriting and modest leverage. Q2 2026 earnings reinforce a key point. Multifamily exposure alone does not determine bank risk. Trepp’s data shows underwriting discipline, portfolio seasoning, risk transfer, and local housing policy drive results. Legacy New York thrifts face ongoing pressure. The 2019 Housing Stability and Tenant Protection Act limits rent growth. A citywide rent freeze for 2026 and 2027 adds further pressure. Those policies compress margins and increase loss reserves. ConnectOne and Dime responded with charge-offs, additional provisions, and, in one case, a proposed portfolio sale. Meanwhile, Merchants spreads risk through GSE securitizations, credit default swaps, and warehouse lending. Those strategies help contain losses despite relatively high non-performing loan ratios. Mechanics demonstrates a different path. Conservative runoff, seasoned loans, and low leverage continue protecting asset quality. Those factors help reduce volatility despite meaningful multifamily exposure. For CRE investors and lenders, headline concentration ratios rarely tell the full story. Community bank mergers have reduced the number of comparable lenders. Consequently, one bank’s losses can shift sentiment across the entire segment. Trepp argues investors should evaluate business models, risk management, and local legislative risks before judging multifamily credit exposure. Community bank mergers continue shrinking the sector. That trend increases the market impact of each bank’s quarterly results. New York’s rent freeze begins for most leases in October 2026. Litigation over rent regulations also remains unresolved. Banks outside legacy rent-stabilized markets appear better positioned. Lenders that distribute risk through securitizations and swaps also have stronger prospects for stable margins and asset quality. Investors should expect continued segmentation across multifamily lending. Underwriting standards will receive closer scrutiny. Market concentration will likely increase among institutions able to tailor strategies to specific portfolios and local markets. Procore Launches Asset Register to Streamline Digital Handovers NYC CMBS Loan Faces $80M Loss Risk as Rent Freeze Looms Snapchat Signs 199K SF Lease at Manhattan’s PENN 2

Merchants Bancorp (MBIN) appears an attractive pick given a noticeable improvement in the company's earnings outlook. The stock has been a strong performer lately, and the momentum might continue with analysts still raising their earnings estimates for the company. Analysts' growing optimism on the earnings prospects of this bank holding company is driving estimates higher, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. Our stock rating tool -- the Zacks Rank -- is principally built on this insight. The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008. For Merchants Bancorp, there has been strong agreement among the covering analysts in raising earnings estimates, which has helped push consensus estimates considerably higher for the next quarter and full year. The chart below shows the evolution of forward 12-month Zacks Consensus EPS estimate: For the current quarter, the company is expected to earn $1.40 per share, which is a change of +44.3% from the year-ago reported number. Over the last 30 days, three estimates have moved higher for Merchants Bancorp compared to no negative revisions. As a result, the Zacks Consensus Estimate has increased 7.95%. The company is expected to earn $5.58 per share for the full year, which represents a change of +47.6% from the prior-year number. There has been an encouraging trend in estimate revisions for the current year as well. Over the past month, three estimates have moved up for Merchants Bancorp versus no negative revisions. This has pushed the consensus estimate 8.35% higher. Thanks to promising estimate revisions, Merchants Bancorp currently carries a Zacks Rank #1 (Strong Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision.You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500. Investors have been betting on Merchants Bancorp because of its solid estimate revisions, as evident from the stock's 13% gain over the past four weeks. As its earnings growth prospects might push the stock higher, you may consider adding it to your portfolio right away. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Merchants Bancorp (MBIN) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Merchants Bancorp (MBIN) came out with quarterly earnings of $1.48 per share, beating the Zacks Consensus Estimate of $1.22 per share. This compares to earnings of $0.6 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +21.31%. A quarter ago, it was expected that this bank holding company would post earnings of $1.16 per share when it actually produced earnings of $1.25, delivering a surprise of +7.76%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Merchants Bancorp, which belongs to the Zacks Banks - Northeast industry, posted revenues of $182.22 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 0.13%. This compares to year-ago revenues of $179.2 million. The company has topped consensus revenue estimates three times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Merchants Bancorp shares have added about 42% since the beginning of the year versus the S&P 500's gain of 8.3%. While Merchants Bancorp has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Merchants Bancorp was unfavorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #4 (Sell) for the stock. So, the shares are expected to underperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.30 on $185.19 million in revenues for the coming quarter and $5.15 on $734.26 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Banks - Northeast is currently in the top 29% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, First Internet Bancorp (INBK), is yet to report results for the quarter ended June 2026. The results are expected to be released on July 30. This internet bank is expected to post quarterly earnings of $0.03 per share in its upcoming report, which represents a year-over-year change of +50%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. First Internet Bancorp's revenues are expected to be $42.45 million, up 26.5% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Merchants Bancorp (MBIN) : Free Stock Analysis Report First Internet Bancorp (INBK) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Diversified bank holding company Merchants Bancorp (NASDAQCM:MBIN) met Wall Street’s revenue expectations in Q2 CY2026, with sales up 1.7% year on year to $182.2 million. Its GAAP profit of $1.48 per share was 22.3% above analysts’ consensus estimates. Is now the time to buy Merchants Bancorp? Find out in our full research report. Net Interest Income: $136.5 million vs analyst estimates of $139.3 million (6.1% year-on-year growth, 2% miss) Net Interest Margin: 2.8% vs analyst estimates of 2.9% (9.5 basis point miss) Revenue: $182.2 million vs analyst estimates of $181.8 million (1.7% year-on-year growth, in line) Efficiency Ratio: 40.2% vs analyst estimates of 42.9% (270 basis point beat) EPS (GAAP): $1.48 vs analyst estimates of $1.21 (22.3% beat) Tangible Book Value per Share: $39.93 vs analyst estimates of $39.62 (12.7% year-on-year growth, 0.8% beat) Market Capitalization: $2.22 billion With a strategic focus on low-risk, government-backed lending programs, Merchants Bancorp (NASDAQCM:MBIN) is an Indiana-based bank holding company specializing in multi-family mortgage banking, mortgage warehousing, and traditional banking services. Two primary revenue streams drive bank earnings. While net interest income, which is earned by charging higher rates on loans than paid on deposits, forms the foundation, fee-based services across banking, credit, wealth management, and trading operations provide additional income. Luckily, Merchants Bancorp’s revenue grew at a decent 10.7% compounded annual growth rate over the last five years. Its growth was slightly above the average banking company and shows its offerings resonate with customers. We at StockStory place the most emphasis on long-term growth, but within financials, a half-decade historical view may miss recent interest rate changes, market returns, and industry trends. Merchants Bancorp’s recent performance shows its demand has slowed as its annualized revenue growth of 5.6% over the last two years was below its five-year trend. We’re wary when companies in the sector see decelerations in revenue growth, as it could signal changing consumer tastes aided by low switching costs. Note: Quarters not shown were determined to be outliers because they were impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business. This quarter, Merchants Bancorp grew its revenue by 1.7% year on year, and its $182.2 million of revenue was in line with Wall Street’s estimates. Net interest income made up 75% of the company’s total revenue during the last five years, meaning lending operations are Merchants Bancorp’s largest source of revenue. Our experience and research show the market cares primarily about a bank’s net interest income growth as non-interest income is considered a lower-quality and non-recurring revenue source. ONE MORE THING: The $21 AI Application Stock Wall Street Forgot. While Wall Street obsesses over who’s building AI, one company is already using it to print money. And nobody’s paying attention. AI chip stocks trade at ridiculous valuations. This company processes a trillion consumer signals monthly using AI and trades at a third of the price. The gap won’t last. The institutions will figure it out. You need to see this first. Read the FREE Report Before They Notice. Banks profit by intermediating between depositors and borrowers, making them fundamentally balance sheet-driven enterprises. Market participants emphasize balance sheet quality and sustained book value growth when evaluating these institutions. When analyzing banks, tangible book value per share (TBVPS) takes precedence over many other metrics. This measure isolates genuine per-share value by removing intangible assets of debatable liquidation worth. Other (and more commonly known) per-share metrics like EPS can sometimes be murky due to M&A or accounting rules allowing for loan losses to be spread out. Merchants Bancorp’s TBVPS grew at an incredible 20.5% annual clip over the last five years. TBVPS growth has recently decelerated to 13% annual growth over the last two years (from $31.27 to $39.93 per share). Over the next 12 months, Consensus estimates call for Merchants Bancorp’s TBVPS to grow by 11.5% to $44.54, mediocre growth rate. It was good to see Merchants Bancorp beat analysts’ EPS expectations this quarter. We were also happy its tangible book value per share narrowly outperformed Wall Street’s estimates. On the other hand, its net interest income missed. Overall, this print was mixed. The stock remained flat at $48.72 immediately after reporting. Big picture, is Merchants Bancorp a buy here and now? If you’re making that decision, you should consider the bigger picture of valuation, business qualities, as well as the latest earnings. We cover that in our actionable full research report which you can read here, it’s free.

For the quarter ended June 2026, Merchants Bancorp (MBIN) reported revenue of $182.22 million, up 1.7% over the same period last year. EPS came in at $1.48, compared to $0.60 in the year-ago quarter. The reported revenue compares to the Zacks Consensus Estimate of $181.98 million, representing a surprise of +0.13%. The company delivered an EPS surprise of +21.31%, with the consensus EPS estimate being $1.22. While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance. As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately. Here is how Merchants Bancorp performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts: Efficiency Ratio: 40.2% versus 42.1% estimated by three analysts on average. Net interest margin: 2.8% versus the three-analyst average estimate of 2.9%. Average Earning Assets: $19.46 billion compared to the $19.37 billion average estimate based on three analysts. Tier I capital/risk-weighted assets Ratio: 12.1% versus the two-analyst average estimate of 12.6%. Total capital/risk-weighted assets Ratio: 12.5% compared to the 13.1% average estimate based on two analysts. Loan servicing fees, net: $11.99 million versus $6.92 million estimated by three analysts on average. Syndication and asset management fees: $6.93 million versus $4.89 million estimated by three analysts on average. Other income: $11.74 million versus $5.67 million estimated by three analysts on average. Mortgage warehouse fees: $1.86 million compared to the $1.99 million average estimate based on three analysts. Total Noninterest Income: $45.68 million versus the three-analyst average estimate of $41.64 million. Gain on Sale of Loans: $13.16 million versus the three-analyst average estimate of $22.17 million. Net Interest Income: $136.54 million versus the three-analyst average estimate of $140.36 million. View all Key Company Metrics for Merchants Bancorp here>>> Shares of Merchants Bancorp have returned -4% over the past month versus the Zacks S&P 500 composite's +1.7% change. The stock currently has a Zacks Rank #4 (Sell), indicating that it could underperform the broader market in the near term. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Merchants Bancorp (MBIN) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Net income of $78.3 million in the second quarter of 2026 increased $40.3 million, or 106%, compared to the second quarter of 2025, and increased $10.6 million, or 16%, compared to the first quarter of 2026. Diluted earnings per common share of $1.48 in the second quarter of 2026 increased 147% compared to the second quarter of 2025 and increased 18% compared to the first quarter of 2026. Total assets reached $21.2 billion, marking the fifth consecutive quarter of new highs, while increasing 4% compared to March 31, 2026, and increasing 9% compared to December 31, 2025. Tangible book value per common share increased to $39.93, its 30th consecutive quarterly high, rising 13% from $35.42 at June 30, 2025, and 4% from $38.55 at March 31, 2026. Asset quality improved meaningfully, as criticized loans receivable of $444.7 million decreased $60.8 million, or 12%, from March 31, 2026, and decreased $63.5 million, or 12%, from December 31, 2025. Nonperforming loans of $205.6 million decreased $41.8 million, or 17%, and total delinquent loans of $208.0 million decreased $34.6 million, or 14%, compared to March 31, 2026. The provision for credit losses of $9.2 million decreased 83% compared to the second quarter of 2025 and decreased 40% compared to the first quarter of 2026. Capital ratios remained strong, with a total capital ratio of 12.5%, reflecting the Company's continued emphasis on financial strength and balance sheet resilience. Liquidity remained strong at $13.0 billion, or 61% of total assets, supported by $5.5 billion of unused borrowing capacity with the Federal Home Loan Bank and Federal Reserve Discount Window and a diversified mix of highly liquid assets, including cash and cash equivalents, short-term investments, mortgage loans in process of securitization, loans held for sale, and warehouse lines of credit. Loans receivable, net of allowance for credit losses, totaled $12.3 billion, increasing $862.9 million, or 8%, from March 31, 2026, and increasing $1.3 billion, or 12%, from December 31, 2025. Total deposits of $14.3 billion increased $1.3 billion, or 10%, from March 31, 2026, and increased $1.2 billion, or 9%, compared to December 31, 2025. Core deposits of $13.0 billion increased $891.3 million compared to March 31, 2026, and represent 91% of total deposits. The Company executed a credit default swap on a $169.9 million pool of multi-family mortgage loans in June 2026, providing credit protection for the loan pool and reducing risk-based capital requirements. CARMEL, Ind., July 28, 2026 /PRNewswire/ -- Merchants Bancorp (the "Company" or "Merchants") (Nasdaq: MBIN), parent company of Merchants Bank, today reported second quarter of 2026 net income of $78.3 million, or diluted earnings per common share of $1.48. This compared to $38.0 million, or diluted earnings per common share of $0.60 in the second quarter of 2025, and compared to $67.7 million, or diluted earnings per common share of $1.25 in the first quarter of 2026. "Our second quarter results reflected continued strength across our businesses, highlighted by assets reaching a new high of $21.2 billion and tangible book value per share of $39.93, marking our 30th consecutive quarter of record tangible book value. Credit trends also improved during the quarter, with our fifth consecutive quarterly decline in criticized loans, which reached their lowest level since mid-2024, along with decreases in nonperforming loans, delinquencies, charge-offs and provision for credit losses. These results demonstrate the strength of our balance sheet, the benefit of improved credit metrics, and ongoing momentum in our business," said Michael F. Petrie, Chairman and CEO of Merchants. Michael J. Dunlap, President and Chief Operating Officer of Merchants, added, "With 10-year Treasury rates remaining elevated, our diversified business model continues to create multiple sources of earnings support in the current rate environment. While the higher rates may pressure near-term gain on sale of loans, loans in our robust pipeline are still expected to convert into permanent loans over time. Meanwhile, higher rates continue to support valuations on our servicing rights and derivatives, providing an offset to pressure on gain on sale revenue. Together with strong liquidity, capital, and improving credit trends, this positions us well to continue generating earnings growth and long-term shareholder value." Net income for the second quarter of 2026 was $78.3 million, an increase of $40.3 million, or 106%, compared to $38.0 million in the second quarter of 2025. The increase was primarily driven by a $43.8 million, or 83%, decrease in the provision for credit losses, reflecting improved asset quality. Net income for the second quarter of 2026 was $78.3 million, an increase of $10.6 million, or 16%, from $67.7 million in the first quarter of 2026. The improvement was driven by a $14.0 million, or 12%, increase in net interest income after provision for credit losses. Total AssetsTotal assets of $21.2 billion at June 30, 2026 increased $908.2 million, or 4%, compared to March 31, 2026, and increased $1.8 billion, or 9%, compared to December 31, 2025. The increases for both periods were primarily due to higher balances in the multi-family and warehouse portfolios, as well as revolving lines of credit collateralized by mortgage servicing rights that are included in the commercial and commercial real estate portfolio. Asset QualityThe allowance for credit losses on loans of $75.8 million, as of June 30, 2026, decreased $1.0 million, or 1%, compared to March 31, 2026, and decreased $7.5 million, or 9%, compared to December 31, 2025. The decreases primarily reflected charge-offs on loans that had specific reserves. During the second quarter of 2026, the Company recorded charge-offs totaling $16.5 million and had $4.8 million in recoveries. Nearly 95% of the charge-offs in the second quarter of 2026 were associated with two multi-family loan relationships. This compared to $46.1 million in charge-offs and no recoveries during the second quarter of 2025 and $23.0 million in charge-offs and $616,000 in recoveries in the first quarter of 2026. Overall, criticized loans receivable of $444.7 million declined $60.8 million, or 12%, compared to March 31, 2026, and declined $63.5 million, or 12%, compared to December 31, 2025. These declines are consistent with the Company's expectation that migration to criticized status would stabilize and eventually subside, supported by ongoing portfolio management efforts. As of June 30, 2026, 6% of the criticized loans were covered by credit default swaps. As of June 30, 2026, all substandard loans have been evaluated for impairment, and these loans have specific reserves of $3.9 million. The Company believes the loan portfolio continues to be well collateralized. Nonperforming loans decreased $41.8 million, or 17%, compared to March 31, 2026, primarily due to loans being paid in full. As of June 30, 2026, nonperforming loans were $205.6 million, or 1.67% of loans receivable, compared to $247.5 million, or 2.16%, as of March 31, 2026, and $197.8 million, or 1.79%, as of December 31, 2025. Total delinquent loans of $208.0 million decreased $34.6 million, or 14%, compared to March 31, 2026. As of June 30, 2026, 10% of the delinquent loans were covered by credit default swaps. The Company has taken additional steps to reduce credit risk through loan sale and securitization activities since 2019. Since 2023, the Company has executed credit protection arrangements through credit default swaps and a credit-linked note to reduce potential loss exposure, with coverage ranging from 13% to 15% of the unpaid principal balance for each arrangement. Despite having credit protection on these loans, the Company is required to carry an allowance for credit losses on loans held for investment. As of June 30, 2026, the remaining balance of loans protected by credit default swaps was $2.2 billion. Total DepositsTotal deposits of $14.3 billion at June 30, 2026, increased $1.3 billion, or 10%, compared to March 31, 2026, and $1.2 billion, or 9%, compared to December 31, 2025. The increase in both periods primarily reflected the growth in core deposits. Core deposits of $13.0 billion at June 30, 2026, reflected increases of $891.3 million, or 7%, from March 31, 2026, and $1.7 billion, or 15%, from December 31, 2025. Core deposits represented 91% of total deposits at June 30, 2026, 93% of total deposits at March 31, 2026, and 87% of total deposits at December 31, 2025. Brokered deposits of $1.3 billion at June 30, 2026, increased $411.3 million, or 46%, from March 31, 2026, and decreased $459.5 million, or 26%, from December 31, 2025. As of June 30, 2026, brokered certificates of deposit had a weighted average remaining duration of 51 days. LiquidityThe Company maintained strong liquidity, supported by substantial borrowing capacity, including unused lines of credit totaling $5.5 billion as of June 30, 2026, compared to $3.9 billion at March 31, 2026, and $5.3 billion at December 31, 2025. The Company's most liquid assets include cash and cash equivalents, short-term investments, including interest-earning demand deposits, mortgage loans in process of securitization, loans held for sale, and warehouse lines of credit included in loans receivable. Combined with unused borrowing capacity of $5.5 billion, these totaled $13.0 billion, or 61%, of its $21.2 billion total assets as of June 30, 2026. This liquidity position provides the Company with flexibility to manage funding costs, interest expense, and asset levels. In addition, the Company's business model is designed to continuously sell or securitize a significant portion of its loans, which provides flexibility in managing its liquidity. Comparison of Operating Results for the Three Months Ended June 30, 2026 and 2025 Net Interest Income of $136.5 million increased $7.8 million, or 6%, compared to $128.7 million. The increase reflected lower interest expense on certificates of deposit, partially offset by higher interest expense on interest-bearing checking accounts and lower interest income on securities held to maturity. Net interest margin of 2.81% decreased two basis points compared to 2.83%. Interest rate spread of 2.43% increased ten basis points compared to 2.33%. Interest Income of $294.1 million decreased $10.3 million, or 3%, compared to $304.4 million. The decrease was primarily attributable to lower average balances and yields on securities held to maturity, as well as lower average yields on higher average balances on loans and loans held for sale. Average balances of $1.4 billion for securities held to maturity decreased $174.1 million, or 11%, compared to $1.6 billion. Average yields on securities held to maturity of 5.19% decreased 72 basis points compared to 5.91%. Average yields on loans and loans held for sale of 6.26% decreased 66 basis points compared to 6.92%. Average balances of $16.2 billion for loans and loans held for sale increased $1.4 billion, or 9%, compared to $14.8 billion. Interest Expense of $157.5 million decreased 10% compared to $175.7 million. The decrease reflected lower average balances and rates on certificates of deposit, partially offset by higher average balances on interest-bearing checking accounts. Average balances of $1.4 billion for certificates of deposit decreased $1.7 billion, or 55%, compared to $3.1 billion. Average interest rates of 3.85% for certificates of deposit decreased 74 basis points compared to 4.59%. Average balances on interest-bearing checking accounts of $7.9 billion increased $1.7 billion, or 28%, compared to $6.2 billion. Average interest rates of 3.43% for interest-bearing checking accounts decreased 53 basis points compared to 3.96%. Provision for Credit Losses was $9.2 million, a decrease of 83% compared to $53.0 million, reflecting improved asset quality, including lower charge-offs and lower specific reserves. Noninterest Income of $45.7 million decreased $4.8 million, or 10%, compared to $50.5 million. The decline was primarily due to a decrease of $10.2 million, or 44%, in gain on sale of loans, partially offset by $5.9 million, or 95%, increase in loan servicing fees. Loan servicing fees included a $6.0 million positive fair market value adjustment to servicing rights, with a $1.4 million positive adjustment in the Banking segment and a $4.6 million positive adjustment in the Multi-family Mortgage Banking segment. This compared to a $258,000 positive fair market value adjustment to servicing rights in the prior period with a $487,000 negative adjustment in the Banking segment and a $745,000 positive adjustment in the Multi-family Mortgage Banking segment. The value of servicing rights generally increases in rising 10-year interest rate environments and declines in falling interest rate environments due to expected prepayments and earning rates that are influenced by projected future interest rates on escrow deposits. Other noninterest income also included a $1.9 million positive fair market value adjustment to floor derivatives, reflected in the Warehouse segment, compared to a $4.3 million positive fair market value adjustment in the prior period. Noninterest Expense of $73.2 million decreased $4.1 million, or 5%, compared to $77.3 million. The lower expenses were primarily due to a $4.2 million decrease in salaries and employee benefits from lower commissions and bonuses. Comparison of Operating Results for the Three Months Ended June 30, 2026 and March 31, 2026 Net Interest Income of $136.5 million increased $7.9 million, or 6%, compared to $128.6 million. The increase reflected higher interest income on loans and loans held for sale, partially offset by higher interest expense on borrowings and deposits. Net interest margin of 2.81% decreased 11 basis points compared to 2.92%. Interest rate spread of 2.43% decreased seven basis points compared to 2.50%. The 11 basis point decline in net interest margin was primarily driven by changes in loan mix, as growth was weighted more toward loans held for sale and warehouse lending than the higher-yielding multi-family and healthcare portfolios. While this mix shift lowered the reported margin, the growth remained profitable and contributed to higher net interest income and overall earnings. Interest Income of $294.1 million increased $23.6 million, or 9%, compared to $270.5 million, primarily reflecting higher average balances at lower average yields on loans and loans held for sale. Average balances of $16.2 billion for loans and loans held for sale increased 10% compared to $14.7 billion. Average yields on loans and loans held for sale of 6.26% decreased eight basis points compared to 6.34%, primarily reflecting the same loan mix shift discussed above. Interest Expense of $157.5 million increased 11% compared to $141.9 million. The increase was primarily driven by higher average balances at lower interest rates on borrowings and higher average balances at higher average interest rates on interest-bearing checking accounts. Average balances of $4.0 billion on borrowings increased $880.5 million, or 28%, compared to $3.1 billion. Average interest rates of 4.06% on borrowings decreased by eight basis points compared to 4.14%. Average balances of $7.9 billion for interest-bearing checking accounts increased $692.0 million, or 10%, compared to $7.2 billion. Average interest rates on interest-bearing checking accounts of 3.43% increased by a basis point compared to 3.42%. Provision for Credit Losses was $9.2 million, a decrease of 40% compared to $15.3 million, reflecting improved asset quality, including lower charge-offs and lower specific reserves. Noninterest Income of $45.7 million decreased 2% compared to $46.6 million. Results reflected a decrease of $3.1 million, or 21%, in loan servicing fees, and a $1.5 million, or 11%, decrease in other noninterest income. Partially offsetting these declines was a $3.8 million, or 122%, increase in syndication and asset management fees. Loan servicing fees included a $6.0 million positive fair market value adjustment to servicing rights, with a $1.4 million positive adjustment in the Banking segment and a $4.6 million positive adjustment in the Multi-family Mortgage Banking segment. This compared to an $8.9 million positive fair market value adjustment to servicing rights in the prior period, with a $1.6 million positive adjustment in the Banking segment and a $7.4 million positive adjustment in the Multi-family Mortgage Banking segment. The value of servicing rights generally increases in rising 10-year interest rate environments and declines in falling interest rate environments due to expected prepayments and earning rates that are influenced by projected future interest rates on escrow deposits. Other noninterest income included a $1.9 million positive fair market value adjustment to floor derivatives, reflected in the Warehouse segment, compared to a $2.7 million positive fair market value adjustment to derivatives in the prior period. Noninterest Expense of $73.2 million decreased $2.4 million, 3%, compared to $75.6 million, primarily due to a $2.5 million decrease in deposit insurance expenses from improved asset quality. About Merchants BancorpMerchants Bancorp is a diversified bank holding company headquartered in Carmel, Indiana operating multiple segments, including Multi-family Mortgage Banking that primarily offers multi-family housing and healthcare facility financing and servicing (through this segment it also serves as a syndicator of low-income housing tax credit and debt funds); Mortgage Warehousing that offers mortgage warehouse financing, commercial loans, and deposit services; and Banking that offers retail and correspondent residential mortgage banking, agricultural lending, and traditional community banking. Merchants Bancorp, with $21.2 billion in assets and $14.3 billion in deposits as of June 30, 2026, conducts its business primarily through its direct and indirect subsidiaries, Merchants Bank of Indiana, Merchants Capital Corp., Merchants Capital Investments, LLC, Merchants Capital Servicing, LLC, Merchants Investment Partners, LLC, and Merchants Mortgage, a division of Merchants Bank of Indiana. For more information and financial data, please visit Merchants' Investor Relations page at investors.merchantsbancorp.com. Forward-Looking Statements This press release contains forward-looking statements which reflect management's current views with respect to, among other things, future events and financial performance. These statements are often, but not always, made through the use of words or phrases such as "may," "might," "should," "could," "predict," "potential," "believe," "expect," "continue," "will," "anticipate," "seek," "estimate," "intend," "plan," "projection," "goal," "target," "aim," "would," "annualized" and "outlook," or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about the industry, management's beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, management cautions that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. A number of important factors could cause actual results to differ materially from those indicated in these forward-looking statements, including the impacts of factors identified in "Risk Factors" or "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company's Annual Report on Form 10-K and other periodic filings with the Securities and Exchange Commission. Any forward-looking statements presented herein are made only as of the date of this press release, and the Company does not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise. Basic45,936,61045,929,93645,883,644Diluted46,005,93845,997,74445,929,563 View original content to download multimedia:https://www.prnewswire.com/news-releases/merchants-bancorp-reports-second-quarter-of-2026-results-302836726.html

The market expects Merchants Bancorp (MBIN) to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended June 2026. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates. The earnings report, which is expected to be released on July 28, might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the stock may move lower. While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of business conditions on the earnings call, it's worth handicapping the probability of a positive EPS surprise. This bank holding company is expected to post quarterly earnings of $1.22 per share in its upcoming report, which represents a year-over-year change of +103.3%. Revenues are expected to be $181.98 million, up 1.6% from the year-ago quarter. The consensus EPS estimate for the quarter has been revised 1.27% lower over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period. Investors should keep in mind that the direction of estimate revisions by each of the covering analysts may not always get reflected in the aggregate change. Price, Consensus and EPS Surprise Estimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. This insight is at the core of our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction). The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only. A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP. Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell). For Merchants Bancorp, the Most Accurate Estimate is lower than the Zacks Consensus Estimate, suggesting that analysts have recently become bearish on the company's earnings prospects. This has resulted in an Earnings ESP of -4.92%. On the other hand, the stock currently carries a Zacks Rank of #4. So, this combination makes it difficult to conclusively predict that Merchants Bancorp will beat the consensus EPS estimate. Analysts often consider to what extent a company has been able to match consensus estimates in the past while calculating their estimates for its future earnings. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number. For the last reported quarter, it was expected that Merchants Bancorp would post earnings of $1.16 per share when it actually produced earnings of $1.25, delivering a surprise of +7.76%. Over the last four quarters, the company has beaten consensus EPS estimates three times. An earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss. That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. Merchants Bancorp doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release. Another stock from the Zacks Banks - Northeast industry, Esquire Financial Holdings, Inc. (ESQ), is soon expected to post earnings of $1.55 per share for the quarter ended June 2026. This estimate indicates a year-over-year change of +12.3%. Revenues for the quarter are expected to be $40.91 million, up 14.2% from the year-ago quarter. The consensus EPS estimate for Esquire Financial has remained unchanged over the last 30 days. However, a higher Most Accurate Estimate has resulted in an Earnings ESP of +1.72%. When combined with a Zacks Rank of #3 (Hold), this Earnings ESP indicates that Esquire Financial will most likely beat the consensus EPS estimate. Over the last four quarters, the company surpassed consensus EPS estimates two times. Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Merchants Bancorp (MBIN) : Free Stock Analysis Report Esquire Financial Holdings, Inc. (ESQ) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research