Macatawa Targets Kent Market
Nearly one year after acquiring the former Grand Bank Financial Corp. in Grand Rapids, the Holland-based Macatawa Bank is preparing to build on its presence in Kent County with at least two new locations, plus an additional location in the Holland area. One of the new Kent County offices is planned for the corner of East Beltline Avenue and Knapp Street in Grand Rapids Township, where Macatawa plans to begin construction in March.
“Our focus in 2003 is to continue to grow our franchise,” bank President Phil Koning said during a Jan. 21 conference call with brokerage analysts. “Our market share in Kent County is small so we have a lot of room to grow in a relatively large market.”
Formed in late 1997, Macatawa Bank has 17 branch offices in Ottawa, Kent and Allegan counties. After quickly staking out a large share of the market in southern Ottawa County and northwestern Allegan County, the bank stepped up an aggressive pursuit of the Kent County market with the acquisition last year of Grand Bank, which at the time had a single location in downtown Grand Rapids.
With the opening of a new location in Forest Hills during the fourth quarter, and including locations opened in the last two years in Wyoming and Grandville, Macatawa Bank now has four offices in Kent County, where the bank’s market share is far smaller than its core market of Ottawa County.
As of June 30, Macatawa’s market share in Kent County, in terms of deposit base, was 3.88 percent, with more than three-quarters of that coming from Grand Bank, according to the most recent data available from the Federal Deposit Insurance Corp. In neighboring Ottawa County, Macatawa Bank holds an 18.1 percent market share, second only to Fifth Third Bank’s 38.3 percent share, and ranks at or near the top of market leaders in each of the communities where it has a presence, according to the FDIC.
Koning believes the new Kent County branch offices will experience the same kind of market acceptance and strong growth that Macatawa Bank has elsewhere.
“We would expect that the branches we open there will contribute to our growth as we’ve grown in Ottawa County,” he said.
Those aggressive growth plans for 2003 come off a record year in 2002 for Macatawa Bank, which nearly doubled quarterly earnings in the fourth quarter alone.
Quarterly earnings totaled $2.91 million, or 36 cents per share, up 98 percent from the $1.47 million, or 26 cents per share, from the same period in 2001.
The bank grew annual earnings for all of 2002 at almost the same rate while racking up strong growth in deposits, loans and assets.
Macatawa Bank posted 2002 net income of $9.51 million, or $1.27 per share, up 86 percent from the $5.11 million, or $1.07 per share, a year earlier.
“While facing significant challenges in 2002 with the integration of Grand Bank, the soft economy and the low interest rate environment, our people came through and produced another record year for earnings and growth,” Macatawa Bank Chairman and CEO Ben Smith.
Macatawa finished 2002 with assets of $1.17 billion, which includes $313 million from the Grand Bank acquisition and $193.3 million in growth. Macatawa had assets of $670.2 million at the end of 2001.
Deposits during the year increased from $526.1 million to $920.8 million, including $152.2 million in growth and $242.5 million from the Grand Bank deal. Loans increased from $545.6 million to $961 million.