Merchants Bancorp reported net income of $61.3 million, or diluted earnings per common share of $1.17, for the third quarter of 2024. This represents a 25% decrease in net income compared to $81.5 million in the third quarter of 2023, and a 20% decrease from $76.4 million in the second quarter of 2024.
The company's asset quality showed signs of deterioration, with non-performing loans increasing to $210.9 million, or 2.04% of gross loans receivable, as of September 30, 2024. This is up from $143.5 million, or 1.30%, at June 30, 2024, primarily due to delinquent payments on variable rate multi-family and healthcare loans and the financial deterioration of a few sponsors.
The allowance for credit losses on loans increased by $3.5 million, or 4%, to $84.5 million compared to June 30, 2024, driven by an $8.0 million increase in specific reserves related to two customers. Despite these challenges, total assets grew by 2% to $18.7 billion, and core deposits increased by 15% to $10.1 billion, representing 78% of total deposits.
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