Independent Bank (IBCP) 8-K Results of Operations and Financial Condition

Exhibit 99.2

INDEPENDENT BANK CORPORATION AND SUBSIDIARIES

Supplemental Data

Non-performing assets ⁽¹⁾

	December 31, 2020			September 30, 2020			June 30, 2020			March 31, 2020			December 31, 2019
	(Dollars in thousands)
Non-accrual loans	$	8,312		$	10,481		$	12,938		$	17,454		$	10,178
Loans 90 days or more past due and still accruing interest		-			266	��		5			-			-
Subtotal		8,312			10,747			12,943			17,454			10,178
Less:  Government guaranteed loans		439			510			604			676			646
Total non-performing loans		7,873			10,237			12,339			16,778			9,532
Other real estate and repossessed assets		766			1,487			1,569			1,494			1,865
Total non-performing assets	$	8,639		$	11,724		$	13,908		$	18,272		$	11,397
As a percent of Portfolio Loans
Non-performing loans		0.29	%		0.36	%		0.43	%		0.62	%		0.35	%
Allowance for loan losses		1.30			1.25			1.20			1.20			0.96
Non-performing assets to total assets		0.21			0.28			0.34			0.50			0.32
Allowance for loan losses as a percent of non-performing loans		450.01			349.43			279.60			193.68			274.32

⁽¹⁾ Excludes loans classified as "trouble debt restructured" that are not past due.

  Troubled debt restructurings ("TDR")

	December 31, 2020
	Commercial		Retail (1)			Total
	(In thousands)
Performing TDR's	$	7,956	$	36,385		$	44,341
Non-performing TDR's (2)		1,148		1,584	(3)		2,732
Total	$	9,104	$	37,969		$	47,073

	December 31, 2019
	Commercial		Retail (1)			Total
	(In thousands)
Performing TDR's	$	7,974	$	39,601		$	47,575
Non-performing TDR's (2)		540		2,607	(3)		3,147
Total	$	8,514	$	42,208		$	50,722

(1) Retail loans include mortgage and installment loan segments.

(2) Included in non-performing assets table above.

(3) Also includes loans on non-accrual at the time of modification until six payments are received on a timely basis.

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Allowance for loan losses

	Twelve months ended December 31,
	2020					2019
	Loans			Unfunded Commitments		Loans			Unfunded Commitments
	(Dollars in thousands)
Balance at beginning of period	$	26,148		$	1,542	$	24,888		$	1,296
Additions (deductions)
Provision for loan losses		12,463			-		824			-
Recoveries credited to allowance		3,069			-		3,961			-
Loans charged against the allowance		(6,251	)		-		(3,525	)		-
Additions included in non-interest expense		-			263		-			246
Balance at end of period	$	35,429		$	1,805	$	26,148		$	1,542
Net loans charged against the allowance to average Portfolio Loans		0.11	%				(0.02	)%

Capitalization

	December 31,
	2020			2019
	(In thousands)
Subordinated debt	$	39,281		$	-
Subordinated debentures		39,524			39,456
Amount not qualifying as regulatory capital		(505	)		(1,224	)
Amount qualifying as regulatory capital		78,300			38,232
Shareholders’ equity
Common stock		339,353			352,344
Retained earnings		40,145			1,611
Accumulated other comprehensive income (loss)		10,024			(3,786	)
Total shareholders’ equity		389,522			350,169
Total capitalization	$	467,822		$	388,401

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Non-Interest Income

	Three months ended								Twelve months ended
	December 31,			September 30,			December 31,		December 31,
	2020			2020			2019		2020			2019
	(In thousands)
Service charges on deposit accounts	$	2,218		$	2,085		$	2,885	$	8,517		$	11,208
Interchange income		2,819			3,428			2,553	$	11,230		$	10,297
Net gains on assets
Mortgage loans		15,873			20,205			6,388		62,560			19,978
Securities		14			-			3		267			307
Mortgage loan servicing, net		(384	)		(644	)		1,348		(9,350	)		(3,336	)
Investment and insurance commissions		493			530			461		1,971			1,658
Bank owned life insurance		160			215			298		910			1,111
Other		1,170			1,192			1,661		4,640			6,513
Total non-interest income	$	22,363		$	27,011		$	15,597	$	80,745		$	47,736

Capitalized Mortgage Loan Servicing Rights

	Three months ended						Twelve months ended
	December 31,						December 31,
	2020			2019			2020			2019
	(In thousands)
Balance at beginning of period	$	15,403		$	16,906		$	19,171		$	21,400
Originated servicing rights capitalized		3,697			2,539			13,957			7,303
Change in fair value		(2,196	)		(274	)		(16,224	)		(9,532	)
Balance at end of period	$	16,904		$	19,171		$	16,904		$	19,171

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Mortgage Loan Activity

	Three months ended									Twelve months ended
	December 31,			September 30,			December 31,			December 31,
	2020			2020			2019			2020			2019
	(Dollars in thousands)
Mortgage loans originated	$	502,491		$	536,502		$	302,520		$	1,820,697		$	1,011,141
Mortgage loans sold		388,631			417,092			248,691			1,447,031			738,910
Net gains on mortgage loans		15,873			20,205			6,388			62,560			19,978
Net gains as a percent of mortgage loans sold  ("Loan Sales Margin")		4.08	%		4.84	%		2.57	%		4.32	%		2.70	%
Fair value adjustments included in the Loan Sales Margin		(0.53	)		0.50			(0.38	)		0.47			0.22

Non-Interest Expense

	Three months ended								Twelve months ended
	December 31,			September 30,		December 31,			December 31,
	2020			2020		2019			2020		2019
	(In thousands)
Compensation	$	10,852		$	10,294	$	10,726		$	41,517	$	41,719
Performance-based compensation		5,485			8,310		4,336			19,725		12,066
Payroll taxes and employee benefits		3,702			3,350		3,484			13,539		13,716
Compensation and employee benefits		20,039			21,954		18,546			74,781		67,501
Occupancy, net		2,120			2,199		2,216			8,938		9,013
Data processing		2,374			2,215		2,308			8,534		8,905
Furniture, fixtures and equipment		964			999		1,055			4,089		4,113
Interchange expense		926			831		883			3,342		3,215
Communications		785			806		728			3,194		2,947
Loan and collection		708			768		709			3,037		2,685
Conversion related expenses		1,541			643		-			2,586		-
Advertising		594			589		515			2,230		2,450
Legal and professional fees		600			566		533			2,027		1,814
FDIC deposit insurance		385			411		(38	)		1,596		685
Amortization of intangible assets		255			255		272			1,020		1,089
Supplies		167			126		164			680		638
Branch closure costs		-			-					417
Correspondent bank service fees		101			101		111			395		411
Costs (recoveries) related to unfunded lending commitments		(8	)		41		(95	)		263		246
Provision for loss reimbursement on sold loans		40			46		50			200		229
Net (gains) losses on other real estate and repossessed assets		(82	)		46		(63	)		64		(90	)
Other		1,198			1,045		1,409			5,020		5,882
Total non-interest expense	$	32,707		$	33,641	$	29,303		$	122,413	$	111,733

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Average Balances and Tax Equivalent Rates

	Three Months Ended December 31,
	2020							2019
	Average							Average
	Balance		Interest		Rate (2)			Balance		Interest		Rate (2)
	(Dollars in thousands)
Assets
Taxable loans	$	2,870,011	$	31,071		4.31	%	$	2,767,857	$	33,061		4.75	%
Tax-exempt loans (1)		6,784		87		5.10			8,180		100		4.85
Taxable securities		803,322		3,299		1.64			437,087		3,031		2.77
Tax-exempt securities (1)		206,256		991		1.92			50,929		408		3.20
Interest bearing cash		79,280		24		0.12			38,416		163		1.68
Other investments		18,427		211		4.56			18,359		249		5.38
Interest Earning Assets		3,984,080		35,683		3.57			3,320,828		37,012		4.44
Cash and due from banks		51,497							48,095
Other assets, net		159,969							160,821
Total Assets	$	4,195,546						$	3,529,744
Liabilities
Savings and interest-bearing checking	$	1,988,438		761		0.15		$	1,547,860		2,441		0.63
Time deposits		477,079		2,755		2.30			611,914		3,046		1.97
Other borrowings		108,789		953		3.48			92,154		711		3.06
Interest Bearing Liabilities		2,574,306		4,469		0.69			2,251,928		6,198		1.09
Non-interest bearing deposits		1,167,241							880,325
Other liabilities		74,767							51,581
Shareholders’ equity		379,232							345,910
Total liabilities and shareholders’ equity	$	4,195,546						$	3,529,744
Net Interest Income			$	31,214						$	30,814
Net Interest Income as a Percent of Average Interest Earning Assets						3.12	%						3.70	%

(1) Interest on tax-exempt loans and securities is presented on a fully tax equivalent basis assuming a marginal tax rate of 21%.

(2) Annualized

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Average Balances and Tax Equivalent Rates

	Twelve Months Ended December 31,
	2020							2019
	Average							Average
	Balance		Interest		Rate			Balance		Interest		Rate
	(Dollars in thousands)
Assets
Taxable loans	$	2,863,846	$	122,875		4.29	%	$	2,713,690	$	133,574		4.92	%
Tax-exempt loans (1)		7,145		360		5.04			7,937		391		4.93
Taxable securities		635,914		12,655		1.99			397,598		11,842		2.98
Tax-exempt securities (1)		137,330		3,673		2.67			52,324		1,683		3.22
Interest bearing cash		59,056		184		0.31			48,023		818		1.70
Other investments		18,410		905		4.92			18,359		1,043		5.68
Interest Earning Assets		3,721,701		140,652		3.78			3,237,931		149,351		4.61
Cash and due from banks		49,886							37,575
Other assets, net		162,068							164,726
Total Assets	$	3,933,655						$	3,440,232
Liabilities
Savings and interest-bearing checking	$	1,821,115		3,882		0.21		$	1,453,061		10,228		0.70
Time deposits		516,306		8,784		1.70			655,718		13,197		2.01
Other borrowings		117,904		3,551		3.01			77,254		2,922		3.78
Interest Bearing Liabilities		2,455,325		16,217		0.66			2,186,033		26,347		1.21
Non-interest bearing deposits		1,054,230							867,314
Other liabilities		65,943							46,153
Shareholders’ equity		358,157							340,732
Total liabilities and shareholders’ equity	$	3,933,655						$	3,440,232
Net Interest Income			$	124,435						$	123,004
Net Interest Income as a Percent of Average Interest Earning Assets						3.34	%						3.80	%

(1) Interest on tax-exempt loans and securities is presented on a fully tax equivalent basis assuming a marginal tax rate of 21%.

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Commercial Loan Portfolio Analysis as of December 31, 2020

	Total Commercial Loans
			Watch Credits						Percent of Loan
Loan Category	All Loans		Performing		Non-accrual		Total		Category in Watch Credit
	(Dollars in thousands)
Land	$	14,567	$	116	$	-	$	116		0.8	%
Land Development		12,176		36		-		36		0.3
Construction		68,724		36		-		36		0.1
Income Producing		358,603		3,699		-		3,699		1.0
Owner Occupied		360,510		24,693		745		25,438		7.1
Total Commercial Real Estate Loans	$	814,580	$	28,580		745	$	29,325		3.6
Other Commercial Loans	$	427,835	$	16,059		695	$	16,754		3.9
Total non-performing commercial loans					$	1,440

Commercial Loan Portfolio Analysis as of December 31, 2019

	Total Commercial Loans
			Watch Credits						Percent of Loan
Loan Category	All Loans		Performing		Non-accrual		Total		Category in Watch Credit
	(Dollars in thousands)
Land	$	11,235	$	275	$	735	$	1,010		9.0	%
Land Development		12,899		-		-		-		0.0
Construction		97,463		-		-		-		0.0
Income Producing		409,897		15,347		-		15,347		3.7
Owner Occupied		323,694		35,485		295		35,780		11.1
Total Commercial Real Estate Loans	$	855,188	$	51,107		1,030	$	52,137		6.1
Other Commercial Loans	$	311,507	$	20,580		347	$	20,927		6.7
Total non-performing commercial loans					$	1,377

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