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Earnings Leap More Than 50 Percent For Macatawa Bank
HOLLAND — Strong growth, especially in commercial lending, boosted Macatawa Bank Corp’s. earnings by more than 50 percent in 2001.
The 4-year-old Holland-based bank corporation recorded net income of $5.1 million, or $1.11 per share, for the year. That compares with earnings of $3.3 million, or 90 cents per share, in 2000.
Fourth quarter earnings, driven up by growth in net interest income, totaled a record $1.47 million, or 28 cents per share, up 40 percent from the $1.05 million, or 28 cents per share, reported for the same period a year earlier.
The quarterly earnings exceed the expectations of Wall Street brokerage analysts by 2 cents per share. The annual financial results met per-share expectations.
Executives attributed the strong earnings growth to increasing business volumes. Macatawa’s lending portfolio alone grew by nearly 34 percent last year — from $410.6 million to $550.2 million — between Dec. 31, 2000, and Dec. 31, 2001.
Commercial lending accounted for $110 million of the nearly $140 million increase in lending during 2001, bank President Phil Koning said. Higher loan volumes, and the fee income they generated, helped to offset tighter lending margins that resulted from lower interest rates.
The bank anticipates another strong lending year in 2002, although it won’t match the growth rate of last year. A lending growth rate in the mid- to high 20 percent in 2002 is “very realistic,” said Ray Tooker, Macatawa’s senior vice president of lending administration.
“We still are having a great deal of opportunities looking at new credits to this organization,” Tooker said during a Jan. 22 conference call with brokerage analysts.
Macatawa’s total assets grew 34 percent for the year, from $499.8 million to $670.2 million. Deposits increased 24 percent, from $398.6 million to $526.1 million.
The corporation is in an “excellent position” to post similar growth rates in 2002 and beyond, Chairman and Chief Executive Officer Benjamin Smith III said.
“Everything is going very well here,” Smith told brokerage analysts.
Macatawa Bank has 14 banking offices in southern Ottawa, southwestern Kent and northwestern Allegan counties. The bank plans to add two new offices in 2002, as well as complete its pending acquisition of Grand Bank in Grand Rapids, which will become a wholly owned subsidiary of Macatawa. The $40 million deal, which remains subject to regulatory and shareholder approvals, is expected to close in the second quarter.