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Merchants Bancorp (MBIN) Announces 13% Increase in Dividend

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Merchants Bancorp (MBIN - Free Report) has increased its quarterly dividend. The company announced a quarterly cash dividend of 9 cents per share, marking an increase of 13% from the prior payout. This dividend will be paid out on Apr 1, 2024, to shareholders of record as of Mar 15, 2024.

Prior to this, MBIN hiked its dividend by 14% to 8 cents per share on Mar 15, 2023. It has increased its dividend payout five times in the past five years.

Also, the company has five-year annualized dividend growth of 13.87%. Currently, MBIN's payout ratio is 6% of earnings.

Based on yesterday's closing price of $39.92, Merchants Bancorp currently has a dividend yield of 0.90%.

The bank also has a share repurchase program in place. In November 2021, MBIN renewed and increased the stock repurchase program by $75 million. In 2022, it bought back 3.9 million worth of shares and did not engage in any share repurchase activity in 2023. The plan expired on Dec 31, 2023.

In September 2023, MBIN announced that Farmers-Merchants National Bank, its subsidiary, has entered into an agreement with Bank of Pontiac.

Per the agreement, Bank of Pontiac will acquire Farmers-Merchants’ branches in Paxton, Melvin and Piper City, IL. Bank of Pontiac will also acquire approximately $157 million in deposits and $22 million in loans.

In another agreement, CBI Bank & Trust will acquire Farmers-Merchants' branch located in Joy, IL and approximately $62 million in deposits and $27 million in loans.

This transaction will help both Farmers-Merchants and MBIN to focus on their core businesses.

Merchants Bancorp had a total debt of $964.1 million and cash and cash equivalents of $584.4 million as of Dec 31, 2023. MBIN has decent liquidity and a strong balance sheet position, which will help the company sustain consistency in its dividend payout in the long run. However, the volatile macroeconomic backdrop remains a near-term concern.

In the past six months, shares of MBIN have jumped 32.6% compared with the industry’s 3.3% growth.
 

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Currently, MBIN carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Banks Taking Similar Steps

Earlier this week, WaFd, Inc. (WAFD - Free Report) announced a quarterly cash dividend of 26 cents per share, marking an increase of 4% from the prior payout. This dividend will be paid out on Mar 8, 2024, to shareholders of record as of Feb 23
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Prior to this, WAFD hiked its dividend by 4.2% to 25 cents per share on Mar 10, 2023. The company has increased its dividend payout five times in the past five years. Also, the company has a five-year annualized dividend growth of 4.83%. Currently, WAFD's payout ratio is 29% of earnings.

Earlier this month, Southside Bancshares, Inc. (SBSI - Free Report) announced a quarterly cash dividend of 36 cents per share, which is 2.9% higher than the prior payout. This dividend will be paid out on Feb 29, 2024, to shareholders on record as of Feb 15.

SBSI hiked its dividend by 2.9% to 35 cents per share in February 2023. The current dividend marks the fourth hike in the past three years. Also, the company has a five-year annualized dividend growth of 3.45%. Currently, SBSI's payout ratio is 49% of earnings.


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