Mercantile Bank (MBWM) 8-K Mercantile Bank Corporation Reports First Quarter 2010 Results

Exhibit 99.1

FOR FURTHER INFORMATION:

AT MERCANTILE BANK CORPORATION:
	Michael Price	Charles Christmas
	Chairman & CEO	Chief Financial Officer
	616-726-1600	616-726-1202
	mprice@mercbank.com	cchristmas@mercbank.com

Mercantile Bank Corporation Reports First Quarter 2010 Results

GRAND RAPIDS, Mich., April 20, 2010 (GLOBE NEWSWIRE) — Mercantile Bank Corporation (NASDAQ: MBWM) (“Mercantile”) reported a first quarter 2010 net loss attributable to common shares of $2.96 million, or ($0.35) per diluted common share, compared to net losses of $4.49 million, or ($0.53) per diluted common share, and $36.4 million, or ($4.28) per diluted common share, for the 2009 first and fourth quarters, respectively. The major factor affecting Mercantile’s profitability for all three quarters was the magnitude of the provision for loan and lease losses, and additionally for the fourth quarter of 2009, the imposition of a $23.2 million valuation allowance on its net deferred tax asset.

With the establishment of the deferred tax asset valuation allowance, Mercantile’s ability to recognize federal income tax benefits during periods in which net losses are recorded is significantly limited, thereby distorting bottom line comparisons to earlier quarters. On a pretax basis, the 2010 first quarter loss was $3.07 million compared to the year-ago first quarter loss of $7.34 million, a 58.1 percent improvement due primarily to a higher level of net interest income and lower loan loss provision in the 2010 quarter.

Michael Price, Chairman and CEO of Mercantile Bank Corporation, commented, “The economic environment has been extremely challenging, and will likely remain difficult for at least the next several quarters. However, we continue to make steady progress improving the performance of our core banking activities. Over the past two years, we have implemented many strategic initiatives that have resulted in improved net interest income,

lower controllable overhead costs, a decline in non-owner occupied commercial real estate loans, strong local deposit growth and significantly reduced levels of, and reliance on, wholesale funds. At all times, our Bank has maintained its “well-capitalized” status. Our improved fundamentals have not only helped mitigate the impact of asset quality costs in the current operating environment, but should have a lasting positive impact on future performance as well.

“By comparison, improvement in the performance of our problem credit portfolio has been achieved at a slower rate, and has been difficult to forecast. Improvement depends largely on external factors, namely, the health of the Michigan economy and our real estate markets, and unemployment levels. It appears that a return to a semblance of economic normalcy will take an extended period of time. Meanwhile, our charge remains to identify and resolve our problem lending relationships as expeditiously as possible, working in partnership with our customers to minimize credit exposure. We strive to maintain open communications with our customer base and preserve those credit relationships that we value. And with these valued customers, we have been proactive in meeting their credit as well as other banking needs.

“The timing and extent of Michigan’s economic recovery is uncertain. Our ability to right-size the bank in response to changes in the economic environment has allowed us to maintain our flexibility as well as our well-capitalized status without additional (and highly dilutive) common equity or capital that would involve significant additional expense. Over the past twelve months, our total assets declined by 15 percent, while our total risk-based capital ratio improved by 66 basis points. We are currently seeing limited creditworthy opportunities, and we have become more selective in our lending efforts as well. Our right-sizing strategy has allowed us to keep pace with economic conditions, yet maintain the capacity to grow through internally-generated equity as the economy improves.”

Operating Results

For the first quarter of 2010, total revenue, consisting of net interest income and noninterest income, was $17.0 million, up $3.1 million, or 22.6 percent, from the $13.8 million reported for the 2009 first quarter. Net interest income was $14.3 million compared to $11.8 million for the year-ago quarter, an increase of $2.5 million, or 21.2 percent, primarily due to an improved net interest margin. The 2010 first quarter net interest margin expanded by 97 basis points, or 42.5 percent, from the net interest margin in the prior-year first quarter, reaching 3.25 percent and more than offsetting the $331 million, or 15.4 percent, decline in average earning assets. Margin improvement resulted from the preservation of asset yield despite increased levels of nonaccruing assets, combined with sharply declining funding costs, primarily from repricing CDs and FHLB advances at lower interest rates as they matured.

First quarter 2010 noninterest income was $2.66 million, up $0.62 million, or 30.7 percent, from the $2.03 million generated in the first quarter of 2009. Since Mercantile will not be in a taxable position near-term, the Company elected to sell $20 million of its $60 million portfolio of tax-exempt municipal securities late during the quarter, realizing a $0.5 million

gain on sale. Proceeds will be reinvested in taxable securities available for sale, primarily during early second quarter. In addition, Mercantile realized a $0.2 million gain on the sale of $5.5 million of the SBA-guaranteed portion of commercial loans. Excluding the gains of $0.7 million, recurring noninterest income declined 3.6 percent in the first quarter of 2010 compared to the first quarter of 2009. The 2010 first quarter was affected by a modest decline in overdraft service charges and lower mortgage banking income, partially offset by increased rental income from foreclosed properties and earnings on bank-owned life insurance.

The provision for loan and lease losses was $8.4 million for the 2010 first quarter compared to $25.3 million and $10.4 million for the linked and year-ago quarters, respectively. Mercantile continues to boost its loan loss reserve, which stands at 3.35 percent of total loans and leases as of March 31, 2010 compared to 1.79 percent at March 31, 2009.

Noninterest expenses for the first quarter of 2010 were $11.6 million, up $0.9 million, or 8.0 percent, from the prior-year first quarter, driven by greater nonperforming asset administration and resolution costs (namely, legal expenses, property tax payments, appraisal costs, and write-downs on foreclosed properties) as well as increased FDIC insurance premiums. First quarter 2010 nonperforming asset administration and resolution costs and FDIC insurance premiums totaled $3.7 million, more than double the $1.6 million incurred in the first quarter of 2009. Mercantile partially offset growth of these problem credit-related and FDIC costs by implementing initiatives that reduced controllable expenses; salaries and benefits, occupancy, furniture and equipment, and other operating expenses decreased by $1.2 million, or 13.2 percent, from first quarter 2009. Staff levels were reduced by 47 employees over the past twelve months, contributing to a 16.0 percent reduction in salary and benefit costs in the first quarter of 2010 compared to the year-ago first quarter.

Balance Sheet

Total assets as of March 31, 2010 were $1.90 billion, virtually unchanged from 2009 year-end. Loans and leases were $1.50 billion, a decline of $42.2 million, or 2.7 percent, since 2009 year-end. Compared to March 31, 2009, total assets declined by $337 million, or 15.0 percent, and loans and leases declined by $280 million, or 15.8 percent. Total real estate loans, excluding residential mortgage loans representing permanent financing of owner-occupied dwellings and home equity lines of credit, were $1.01 billion at March 31, 2010, a decline of $23.4 million, or 2.3 percent, from year-end 2009, and $153 million, or 13.2 percent, since the year-ago quarter-end. Commercial non-owner occupied real estate loans totaled $633 million at the end of the 2010 first quarter, a decrease of $15.8 million, or 2.4 percent, from year-end 2009, and $70.3 million, or 10.0 percent, from the year-ago quarter-end. Commercial owner-occupied real estate loans were $318 million at March 31, 2010, a decline of $7.9 million, or 2.4 percent, from year-end 2009, and $56.6 million, or 15.1 percent, since the year-ago quarter-end. Residential-related vacant land, land development, and construction loans totaled $60.9 million as of March 31, 2010, an increase of $0.3 million, or 0.4 percent, from year-end 2009, but a decline of $26.4 million, or 30.2 percent, from the year-ago quarter-end.

At March 31, 2010, securities and cash and cash equivalents represented 12.0 percent and 5.1 percent of total assets, respectively. Since Mercantile is not currently in a taxable position, the Company liquidated $20 million of its $60 million portfolio of tax-exempt municipal securities during the first quarter of 2010. Proceeds will be reinvested in taxable securities available for sale, and all securities, including the remaining municipal securities, are now included in the available for sale portfolio.

LOANS SECURED BY REAL ESTATE *

	3/31/10		12/31/09			9/30/09		6/30/09		3/31/09
Residential-Related:
Vacant Land	$	20,871,000	$	19,465,000		$	20,630,000	$	21,400,000	$	22,244,000
Land Development		32,199,000		34,027,000			33,862,000		42,053,000		50,402,000
Construction		7,872,000		7,199,000			9,446,000		11,157,000		14,646,000
		60,942,000		60,691,000			63,938,000		74,610,000		87,292,000
Commercial Non-Owner Occupied:
Vacant Land		22,304,000		25,549,000	��		25,564,000		29,005,000		28,775,000
Land Development		19,058,000		19,402,000			22,412,000		23,469,000		24,636,000
Construction		52,107,000		65,697,000			79,339,000		94,225,000		93,322,000
Commercial Buildings		539,284,000		537,891,000			528,727,000		545,501,000		556,280,000
		632,753,000		648,539,000			656,042,000		692,200,000		703,013,000
Commercial Owner-Occupied
Construction		1,651,000		1,404,000			5,456,000		7,407,000		9,290,000
Commercial Buildings		316,302,000		324,451,000			349,335,000		359,610,000		365,250,000
		317,953,000		325,855,000			354,791,000		367,017,000		374,540,000
Total	$	1,011,648,000	$	1,035,085,000		$	1,074,771,000	$	1,133,827,000	$	1,164,845,000

* Excludes residential mortgage loans representing permanent financing of owner occupied dwellings and home equity lines of credit.

Total deposits at March 31, 2010 were $1.42 billion, up $18.6 million, or 1.3 percent, from December 31, 2009. Local deposits increased by $8.6 million to $685.3 million, led by growth in NOW and money market accounts, which more than offset the decline in local certificates of deposit. Since year-end 2009, brokered deposits increased $10.0 million to $735 million at March 31, 2010; they now account for 51.7 percent of total deposits, unchanged from year-end 2009.

Total wholesale funds were $940 million as of March 31, 2010, a decline of $7.6 million from year-end 2009 and $382 million from the year-ago quarter-end. As a percentage of total funds, wholesale funds equaled 54.5 percent at the end of the first quarter of 2010, down from 55.0 percent at year-end 2009 and 65.5 percent at the prior-year first quarter-end.

Asset Quality

Nonperforming assets at March 31, 2010 were $118 million, or 6.2 percent of total assets, compared to $112 million (5.9 percent of total assets) and $83.7 million (3.7 percent of total assets), respectively, at December 31, 2009 and March 31, 2009. Nonperforming assets increased by $5.9 million since year-end 2009 and $33.8 million from the year-ago quarter-end.

Robert B. Kaminski Jr., Executive Vice President and Chief Operating Officer of Mercantile Bank Corporation, addressed Mercantile’s ongoing efforts to identify and administer problem assets and minimize exposure associated with their resolution. “While we are still adding to our problem asset levels due to the continued difficult economic environment, one of the more encouraging signs in our markets for the past few quarters has been the increased interest demonstrated by potential investors in commercial properties. This interest has recently been translating into elevated sales activity.”

Commercial real estate assets, excluding land development and construction assets, accounted for the majority of the $118 million of nonperforming assets at March 31, 2010 — $63.9 million, or approximately 54 percent, up $5.5 million since year-end 2009 and $26.7 million since March 31, 2009. Non-owner occupied properties comprised approximately 73 percent of nonperforming commercial real estate assets at March 31, 2010. Nonperforming construction and land development (“C&D”) assets (both residential and commercial combined) were $38.5 million at March 31, 2010, accounting for 32.7 percent of total nonperforming assets; they increased by $2.4 million, or 6.7 percent, from year-end 2009 and by $9.9 million, or 34.7 percent, from March 31, 2009. At March 31, 2010, approximately 89 percent of nonperforming C&D assets were related to residential construction projects. Nonperforming non-real estate commercial loans and repossessed assets were $9.3 million at 2010 first quarter-end, a decline of $0.5 million from year-end 2009 and $3.9 million from the prior-year first quarter-end. Nonperforming owner-occupied and rental residential assets totaled $5.9 million at March 31, 2010, down $1.6 million from December 31, 2009, but $1.0 million higher than March 31, 2009.

NONPERFORMING ASSETS

	3/31/10		12/31/09		9/30/09		6/30/09		3/31/09
Residential Real Estate:
Land Development	$	22,781,000	$	19,722,000	$	13,645,000	$	10,422,000	$	12,646,000
Construction		11,425,000		12,103,000		13,021,000		12,882,000		13,538,000
Owner Occupied / Rental		5,908,000		7,493,000		6,830,000		4,910,000		4,877,000
		40,114,000		39,318,000		33,496,000		28,214,000		31,061,000
Commercial Real Estate:
Land Development		3,031,000		2,971,000		4,621,000		2,292,000		2,383,000
Construction		1,238,000		1,268,000		228,000		0		0
Owner Occupied		17,311,000		19,918,000		21,429,000		17,378,000		8,753,000
Non-Owner Occupied		46,552,000		38,417,000		36,473,000		28,110,000		28,364,000
		68,132,000		62,574,000		62,751,000		47,780,000		39,500,000
Non-Real Estate:
Commercial Assets		9,303,000		9,758,000		14,510,000		10,629,000		13,155,000
Consumer Assets		8,000		8,000		8,000		8,000		31,000
		9,311,000		9,766,000		14,518,000		10,637,000		13,186,000
Total	$	117,557,000	$	111,658,000	$	110,765,000	$	86,631,000	$	83,747,000

NONPERFORMING LOANS

	3/31/10		12/31/09		9/30/09		6/30/09		3/31/09
Past due 90 days+ and accruing interest	$	0	$	243,000	$	3,040,000	$	48,000	$	2,426,000
Nonaccrual		88,450,000		81,818,000		87,190,000		73,623,000		71,943,000
Troubled debt restructurings		6,011,000		2,989,000		1,012,000		0		0
Total	$	94,461,000	$	85,050,000	$	91,242,000	$	73,671,000	$	74,369,000

Since year-end 2009, Mercantile added $23.0 million of nonperforming assets to its problem portfolio and successfully disposed of $10.1 million through a combination of asset sales, principal paydowns and a return to performing status. Loan charge-offs accounted for a reduction of $6.1 million and OREO valuation write-downs were $0.9 million. Nonperforming assets increased a net $5.9 million during the first quarter of 2010.

NONPERFORMING ASSETS RECONCILIATION

	1st Qtr			4th Qtr			3rd Qtr			2nd Qtr			1st Qtr
	2010			2009			2009			2009			2009
Beginning balance	$	111,658,000		$	110,765,000		$	86,631,000		$	83,747,000		$	57,421,000
Additions		23,054,000			22,308,000			39,815,000			18,768,000			31,745,000
Returns to performing status		(811,000	)		0			(47,000	)		0			(1,156,000	)
Principal payments		(4,242,000	)		(8,652,000	)		(3,707,000	)		(5,438,000	)		(1,318,000	)
Sale proceeds		(5,080,000	)		(3,353,000	)		(1,630,000	)		(1,484,000	)		(451,000	)
Loan charge-offs		(6,117,000	)		(7,862,000	)		(8,578,000	)		(8,785,000	)		(2,209,000	)
Valuation write-downs		(905,000	)		(1,548,000	)		(1,719,000	)		(177,000	)		(285,000	)
Total	$	117,557,000		$	111,658,000		$	110,765,000		$	86,631,000		$	83,747,000

Net loan and lease charge-offs for the 2010 first quarter were $6.2 million, or 1.6 percent of average loans and leases (annualized), compared with $10.9 million (2.7 percent annualized) and $5.6 million (1.3 percent annualized) for the fourth and first quarters of 2009, respectively.

NET LOAN CHARGE-OFFS

	1st Qtr		4th Qtr			3rd Qtr		2nd Qtr		1st Qtr
	2010		2009			2009		2009		2009
Residential Real Estate:
Land Development	$	565,000	$	2,204,000		$	467,000	$	1,060,000	$	624,000
Construction		587,000		733,000			3,208,000		1,023,000		86,000
Owner Occupied / Rental		326,000		946,000			530,000		729,000		1,442,000
		1,478,000		3,883,000			4,205,000		2,812,000		2,152,000
Commercial Real Estate:
Land Development		617,000		45,000			0		74,000		0
Construction		0		0			0		0		0
Owner Occupied		1,091,000		1,140,000			1,254,000		593,000		75,000
Non-Owner Occupied		1,945,000		3,009,000			3,265,000		2,347,000		786,000
		3,653,000		4,194,000			4,519,000		3,014,000		861,000
Non-Real Estate:
Commercial Assets		1,012,000		2,788,000			2,232,000		4,918,000		2,475,000
Consumer Assets		9,000		(1,000	)		7,000		35,000		136,000
		1,021,000		2,787,000			2,239,000		4,953,000		2,611,000
Total	$	6,152,000	$	10,864,000		$	10,963,000	$	10,779,000	$	5,624,000

Capital Position

Shareholders’ equity totaled $138 million as of March 31, 2010, a decrease of $31.1 million, or 18.4 percent, from March 31, 2009. The Bank remains “well-capitalized,” with a total risk-based capital ratio of 11.2 percent as of March 31, 2010 compared to 11.1 percent and 10.8 percent at December 31 and March 31, 2009, respectively. The Bank’s total regulatory capital as of March 31, 2010 was $188 million, approximately $20.2 million in excess of the minimum 10.0 percent required to be considered “well-capitalized”. This past quarter, Mercantile’s Board of Directors elected to suspend future quarterly cash dividend payments on common stock until economic conditions and financial performance improve. Mercantile’s total shares outstanding at first quarter-end were 8,593,270.

Mr. Price concluded, “We are hopeful that the worst of the economic crisis is behind us, although we are aware that a return to full economic health will take an extended period of time. In the meantime, we believe we are well-positioned to weather the continued drag on our profitability with the strategies we have in place, and will continue to look for opportunities to enhance our core banking performance and maintain our well-capitalized status.”

About Mercantile Bank Corporation

Based in Grand Rapids, Michigan, Mercantile Bank Corporation is the bank holding company for Mercantile Bank of Michigan. Founded in 1997 to provide banking services to businesses, individuals, and governmental units, the Bank differentiates itself on the basis of service quality and the expertise of its banking staff. Mercantile has seven full-service banking offices in Grand Rapids, Holland and Lansing, Michigan. Mercantile Bank Corporation’s common stock is listed on the NASDAQ Global Select Market under the symbol “MBWM.”

Forward-Looking Statements

This news release contains comments or information that constitute forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995) that are based on current expectations that involve a number of risks and uncertainties. Actual results may differ materially from the results expressed in forward-looking statements. Factors that might cause such a difference include changes in interest rates and interest rate relationships; demand for products and services; the degree of competition by traditional and nontraditional competitors; changes in banking regulation or actions by bank regulators; changes in tax laws; changes in prices, levies, and assessments; the impact of technological advances; governmental and regulatory policy changes; the outcomes of contingencies; trends in customer behavior as well as their ability to repay loans; changes in local real estate values; changes in the national and local economies; and other factors, including risk factors, disclosed from time to time in filings made by Mercantile with the Securities and Exchange Commission. Mercantile undertakes no obligation to update or clarify forward-looking statements, whether as a result of new information, future events or otherwise.

Mercantile Bank Corporation
First Quarter 2010 Results

MERCANTILE BANK CORPORATION
CONSOLIDATED BALANCE SHEETS

	MARCH 31,			DECEMBER 31,			MARCH 31,
	2010			2009			2009
	(Unaudited)			(Audited)			(Unaudited)
ASSETS
Cash and due from banks	$	12,606,000		$	18,896,000		$	17,155,000
Short-term investments		9,475,000			1,471,000			30,032,000
Federal funds sold		74,352,000			1,368,000			90,099,000
Total cash and cash equivalents		96,433,000			21,735,000			137,286,000
Securities available for sale		212,949,000			182,491,000			161,484,000
Securities held to maturity		0			59,212,000			65,451,000
Federal Home Loan Bank stock		15,681,000			15,681,000			15,681,000
Loans and leases		1,497,624,000			1,539,818,000			1,778,057,000
Allowance for loan and lease losses		(50,126,000	)		(47,878,000	)		(31,884,000	)
Loans and leases, net		1,447,498,000			1,491,940,000			1,746,173,000
Premises and equipment, net		29,141,000			29,684,000			31,697,000
Bank owned life insurance policies		45,436,000			45,024,000			42,807,000
Accrued interest receivable		7,057,000			7,088,000			8,597,000
Other real estate owned and repossessed assets		23,096,000			26,608,000			9,378,000
Other assets		25,632,000			26,745,000			21,210,000
Total assets	$	1,902,923,000		$	1,906,208,000		$	2,239,764,000
LIABILITIES AND SHAREHOLDERS’ EQUITY
Deposits:
Noninterest-bearing	$	118,391,000		$	121,157,000		$	112,617,000
Interest-bearing		1,301,818,000			1,280,470,000			1,538,666,000
Total deposits		1,420,209,000			1,401,627,000			1,651,283,000
Securities sold under agreements to repurchase		98,619,000			99,755,000			91,982,000
Federal funds purchased		0			2,600,000			0
Federal Home Loan Bank advances		190,000,000			205,000,000			260,000,000
Subordinated debentures		32,990,000			32,990,000			32,990,000
Other borrowed money		16,829,000			16,890,000			16,825,000
Accrued expenses and other liabilities		6,056,000			7,242,000			17,339,000
Total liabilities		1,764,703,000			1,766,104,000			2,070,419,000
SHAREHOLDERS’ EQUITY
Preferred stock, net of discount		19,896,000			19,839,000			0
Common stock		173,631,000			173,576,000			172,194,000
Retained earnings (deficit)		(57,134,000	)		(54,170,000	)		(5,770,000	)
Accumulated other comprehensive income (loss)		1,827,000			859,000			2,921,000
Total shareholders’ equity		138,220,000			140,104,000			169,345,000
Total liabilities and shareholders’ equity	$	1,902,923,000		$	1,906,208,000		$	2,239,764,000

Mercantile Bank Corporation
First Quarter 2010 Results

MERCANTILE BANK CORPORATION
CONSOLIDATED REPORTS OF INCOME

	THREE MONTHS ENDED			THREE MONTHS ENDED
	March 31, 2010			March 31, 2009
	(Unaudited)			(Unaudited)
INTEREST INCOME
Loans and leases, including fees	$	20,406,000		$	25,185,000
Investment securities		2,743,000			2,776,000
Federal funds sold		31,000			47,000
Short-term investments		9,000			13,000
Total interest income		23,189,000			28,021,000
INTEREST EXPENSE
Deposits		6,497,000			12,841,000
Short-term borrowings		344,000			440,000
Federal Home Loan Bank advances		1,696,000			2,452,000
Other borrowings		346,000			483,000
Total interest expense		8,883,000			16,216,000
Net interest income		14,306,000			11,805,000
Provision for loan and lease losses		8,400,000			10,400,000
Net interest income after provision for loan and lease losses		5,906,000			1,405,000
NONINTEREST INCOME
Service charges on accounts		466,000			512,000
Gain on sale of commercial loans		220,000			0
Net gain on sale of investment securities		476,000			0
Other income		1,493,000			1,520,000
Total noninterest income		2,655,000			2,032,000
NONINTEREST EXPENSE
Salaries and benefits		4,665,000			5,552,000
Occupancy		750,000			921,000
Furniture and equipment		409,000			467,000
Nonperforming asset costs		2,504,000			983,000
FDIC insurance costs		1,186,000			634,000
Other expense		2,120,000			2,215,000
Total noninterest expense		11,634,000			10,772,000
Income (loss) before federal income tax expense (benefit)		(3,073,000	)		(7,335,000	)
Federal income tax expense (benefit)		(430,000	)		(2,846,000	)
Net income (loss)		(2,643,000	)		(4,489,000	)
Preferred stock dividends and accretion		320,000			0
Net income (loss) attributable to common shares	$	(2,963,000	)	$	(4,489,000	)
Basic earnings (loss) per share		($0.35	)		($0.53	)
Diluted earnings (loss) per share		($0.35	)		($0.53	)
Average basic shares outstanding		8,501,671			8,481,265
Average diluted shares outstanding		8,501,671			8,481,265

Mercantile Bank Corporation
First Quarter 2010 Results

MERCANTILE BANK CORPORATION
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited)

	Quarterly
	1st Qtr			4th Qtr			3rd Qtr			2nd Qtr			1st Qtr
(dollars in thousands except per share data)	2010			2009			2009			2009			2009
EARNINGS
Net interest income	$	14,306			13,511			13,567			12,450			11,805
Provision for loan and lease losses	$	8,400			25,300			11,800			11,500			10,400
Noninterest income	$	2,655			1,953			1,710			1,863			2,032
Noninterest expense	$	11,634			10,835			12,517			12,364			10,772
Net income (loss) before federal income tax expense (benefit)	$	(3,073	)		(20,671	)		(9,040	)		(9,551	)		(7,335	)
Net income (loss)	$	(2,643	)		(36,087	)		(5,286	)		(6,225	)		(4,489	)
Net income (loss) common shares	$	(2,963	)		(36,406	)		(5,606	)		(6,388	)		(4,489	)
Basic earnings (loss) per share	$	(0.35	)		(4.28	)		(0.66	)		(0.75	)		(0.53	)
Diluted earnings (loss) per share	$	(0.35	)		(4.28	)		(0.66	)		(0.75	)		(0.53	)
Average shares outstanding		8,501,671			8,496,555			8,492,946			8,487,747			8,481,265
Average diluted shares outstanding		8,501,671			8,496,555			8,492,946			8,487,747			8,481,265
PERFORMANCE RATIOS
Return on average assets		(0.63	%)		(7.28	%)		(1.09	%)		(1.19	%)		(0.81	%)
Return on average common equity		(8.62	%)		(81.98	%)		(12.26	%)		(14.54	%)		(10.50	%)
Net interest margin(fully tax-equivalent)		3.25	%		2.93	%		2.85	%		2.50	%		2.28	%
Efficiency ratio		68.59	%		70.07	%		81.93	%		86.38	%		77.85	%
Full-time equivalent employees		251			257			265			278			298
CAPITAL
Period-ending equity to assets		7.26	%		7.35	%		8.79	%		8.77	%		7.56	%
Tier 1 leverage capital ratio		8.77	%		8.64	%		9.70	%		9.46	%		8.49	%
Tier 1 risk-based capital ratio		10.02	%		9.92	%		10.72	%		10.48	%		9.38	%
Total risk-based capital ratio		11.29	%		11.18	%		11.98	%		11.74	%		10.63	%
Book value per share	$	13.64			13.86			18.19			18.71			19.70
Cash dividend per share	$	0.01			0.01			0.01			0.01			0.04
ASSET QUALITY
Gross loan charge-offs	$	6,846			11,225			11,545			11,111			5,740
Net loan charge-offs	$	6,152			10,864			10,963			10,779			5,624
Net loan charge-offs to average loans		1.64	%		2.72	%		2.61	%		2.47	%		1.25	%
Allowance for loan and lease losses	$	50,126			47,878			33,443			32,605			31,884
Allowance for loan losses to total loans		3.35	%		3.11	%		2.07	%		1.91	%		1.79	%
Nonperforming loans	$	94,461			85,050			91,242			73,671			74,369
Other real estate and repossessed assets	$	23,096			26,608			19,523			12,960			9,378
Nonperforming assets to total assets		6.18	%		5.86	%		5.49	%		4.18	%		3.74	%
END OF PERIOD BALANCES
Loans and leases	$	1,497,624			1,539,818			1,614,226			1,708,524			1,778,057
Total earning assets(before allowance)	$	1,810,081			1,800,041			1,904,944			1,968,436			2,140,804
Total assets	$	1,902,923			1,906,208			2,017,350			2,071,372			2,239,764
Deposits	$	1,420,209			1,401,627			1,450,968			1,478,633			1,651,283
Shareholders’ equity	$	138,220			140,104			177,291			181,692			169,345
AVERAGE BALANCES
Loans and leases	$	1,516,898			1,585,523			1,663,510			1,749,919			1,821,428
Total earning assets(before allowance)	$	1,823,828			1,874,752			1,935,637			2,050,071			2,155,278
Total assets	$	1,920,751			1,983,111			2,042,355			2,146,593			2,254,307
Deposits	$	1,433,091			1,421,850			1,469,264			1,558,206			1,658,323
Shareholders’ equity	$	139,485			176,196			181,400			176,189			173,414