Exhibit 99.1

PRESS RELEASE

Merchants Bancorp Reports Third Quarter 2021 Results

For Release October 28, 2021

CARMEL, Indiana – (PR Newswire) - Merchants Bancorp (the “Company” or “Merchants”) (Nasdaq: MBIN), parent company of Merchants Bank of Indiana, today reported third quarter 2021 net income of $58.5 million, or diluted earnings per common share of $1.83. This compared to $55.0 million, or diluted earnings per common share of $1.79 in the third quarter of 2020, and compared to $51.4 million, or diluted earnings per common share of $1.58 in the second quarter of 2021.

“As total assets surpassed the $10 billion mark during the third quarter, Merchants continued to effectively manage its capital by organically growing its product offerings and expanding its customer base to deliver profitable growth, all while minimizing credit and interest rate risk. During the quarter our tangible book value reached $25.36 per common share, return on assets reached 2.29%, and our return on average tangible common equity was 29.8%,” said Michael F. Petrie, Chairman and CEO of Merchants.

Michael J. Dunlap, President and Chief Operating Officer of Merchants, added, “The demand for affordable housing continues to grow and we have never been better positioned to offer both debt and equity products to support our multi-family customers. Our low-income housing tax credit syndication business was launched late last year and has already closed several funds. We also started a new multi-family debt fund during the third quarter. Warehouse and single-family have performed well despite an industry decline, and our SBA platform has shown significant growth and expanded nationally. The breadth, diversity, and risk levels of our product offerings have positioned us well for profitable growth.”

Net income for the third quarter 2021 increased by $3.5 million, or 6%, compared to the third quarter of 2020, driven by a $3.6 million, or 5%, increase in net interest income that reflected a 23% decrease in the cost of deposits and a 1% increase in interest income from higher loan balances. Also contributing to the increase was a $1.6 million, or 4%, increase in noninterest income. Noninterest income for the third quarter of 2021 benefited from a $3.0 million positive fair market value adjustment to servicing rights that compared to $1.0 negative fair market value adjustment in the third quarter of 2020.

Net income for the third quarter 2021 increased by $7.1 million, or 14%, compared to the second quarter of 2021, primarily driven by a $7.4 million, or 23%, increase in noninterest income, as gain on sale of loans increased by 15% and loan servicing fees more than doubled. Loan servicing fees for the third quarter of 2021 benefited from a $3.0 million positive fair market value adjustment compared to $0.7 positive fair market value adjustment in the second quarter of 2021. Net interest income also contributed to the growth in net income, as it grew 7% compared to the second quarter of 2021.

Total Assets

Total assets of $11.0 billion at September 30, 2021 increased $1.1 billion, or 11%, compared to June 30, 2021, and increased $1.3 billion, or 14%, compared to December 31, 2020.

Return on average assets was 2.29% for the third quarter of 2021 compared to 2.34% for the third quarter of 2020 and 2.14% for the second quarter of 2021.

Asset Quality

The allowance for loan losses of $29.1 million at September 30, 2021 increased $0.4 million compared to June 30, 2021 and increased $1.6 million compared to December 31, 2020. The increases compared to December 31, 2020 were primarily based on growth in the multi-family loan portfolio. The portion of the allowance associated with the COVID-19 pandemic has remained relatively steady since September 30, 2020, at approximately $0.7 million. As of September 30, 2021, the Company had only 3 loans remaining in payment deferral arrangements, with unpaid balances of $37.0 million.

Non-performing loans were $2.9 million, or 0.05%, of loans receivable at September 30, 2021, compared to $3.0 million, or 0.05% of loans receivable at June 30, 2021, and compared to $6.3 million, or 0.11% of loans receivable at December 31, 2020.

Total Deposits

Total deposits of $8.9 billion at September 30, 2021 increased $907.7 million compared to June 30, 2021, and increased $1.5 billion, or 21%, compared to December 31, 2020. The increase compared to December 31, 2020 was primarily due to growth in brokered certificates of deposits.

Total brokered deposits of $1.7 billion at September 30, 2021 increased $813.3 million, or 95%, from June 30, 2021 and increased $492.7 million, or 42%, from December 31, 2020. Brokered deposits represented 19% of total deposits at September 30, 2021 compared to 11% of total deposits at June 30, 2021 and 16% of total deposits at December 31, 2020. The increases reflected a shift from borrowing at the Federal Home Loan Bank of Indianapolis during the third quarter of 2021 after a change in their collateral policy to eliminate certain agency eligible mortgage loan participations.

Liquidity

Cash balances of $802.6 million at September 30, 2021 increased by $400.5 million compared to June 30, 2021 and increased by $622.8 million compared to December 31, 2020. The Company also continues to have significant borrowing capacity, with unused lines of credit at $2.1 billion at September 30, 2021 compared to $3.3 billion at June 30, 2021 and $2.6 billion at December 31, 2020. This liquidity enhances the ability to effectively manage interest expense and asset levels in the future. The decrease in borrowing capacity compared to prior periods reflected the change in collateral policy at the Federal Home Loan Bank of Indianapolis to eliminate certain agency eligible mortgage loan participations.

Net Interest Income

Net interest income of $68.9 million in the third quarter of 2021 increased $3.6 million, or 5%, compared to the third quarter of 2020 and increased $4.5 million, or 7%, compared to the second quarter of 2021.

The 5% increase in net interest income compared to the third quarter of 2020 reflected a 23% decrease in the cost of deposits and a 1% increase in interest income from higher loan balances. The interest rate spread of 2.67% for the third quarter of 2021 decreased 7 basis points compared to 2.74% in the third quarter of 2020. The net interest margin of 2.73% for the third quarter of 2021 decreased 8 basis points compared to 2.81% for the third quarter of 2020. The modest decrease in net interest margin compared to the third quarter of 2020 reflected lower funding costs and higher loan balances that were outpaced by lower interest rates on loans.

The 7% increase in net interest income compared to the second quarter of 2021 reflected higher loan balances and lower rates on loans. The interest rate spread of 2.67% for the third quarter of 2021 decreased 1 basis point compared to 2.68% in the second quarter of 2021. The net interest margin of 2.73% for the third quarter of 2021 also decreased 2 basis points compared to 2.75% for the second quarter of 2021.

Interest Income

Interest income of $77.3 million in the third quarter of 2021 increased $1.1 million, or 1%, compared to the third quarter of 2020 and increased $4.9 million, or 7%, compared to the second quarter of 2021.

The 1% increase in interest income compared to the third quarter of 2020 was primarily due to significant loan growth that was partially offset by lower rates. The higher interest income reflected a $765.4 million, or 10%, increase in the average balance of loans, including loans held for sale, which reached $8.7 billion for the third quarter of 2021. The average yield on loans and loans held for sale of 3.33% for the third quarter of 2021 decreased 28 basis points compared to 3.61% for the third quarter of 2020.

The 7% increase in interest income compared to the second quarter of 2021 reflected a $783.4 million, or 10%, increase in the average balance of loans, including loans held for sale, which reached $8.7 billion for the third quarter of 2021. The average yield on loans and loans held for sale of 3.33% for the third quarter of 2021 decreased 13 basis points compared to 3.46% for the second quarter of 2021.

Interest Expense

Total interest expense decreased $2.5 million, or 23%, to $8.4 million for the third quarter of 2021 compared to the third quarter of 2020 and increased $0.4 million, or 5%, compared to the second quarter of 2021. Interest expense on deposits of $7.0 million for the third quarter of 2021 decreased $2.1 million, or 23%, compared to the third quarter of 2020 and increased $0.3 million, or 4%, compared to the second quarter of 2021.

The 23% decrease in interest expense on deposits compared to the third quarter of 2020 was primarily due to significant decreases in average balances and rates of certificates of deposits. The average balance of interest-bearing deposits of $7.8 billion for the third quarter of 2021 increased $576.4 million, or 8%, compared to the third quarter of 2020. The average yield of interest-bearing deposits was 0.35% for the third quarter of 2021, which was a 15 basis point decrease compared to 0.50% for the third quarter of 2020.

The 4% increase in interest expense on deposits compared to the second quarter of 2021 was primarily due to higher balances of money market and certificates of deposit that were partially offset by lower rates on certificates of deposit. The average balance of interest-bearing deposits of $7.8 billion for the third quarter of 2021 increased $427.8 million, or 6%, compared to the second quarter of 2021. The average yield of interest-bearing deposits was 0.35% for the third quarter of 2021, which was a 1 basis point decrease compared to 0.36% in the second quarter of 2021.

Noninterest Income

Noninterest income of $40.3 million for the third quarter of 2021 increased $1.6 million, or 4%, compared to the third quarter of 2020 and increased $7.4 million, or 23%, compared to the second quarter of 2021.

The 4% increase in noninterest income compared to the third quarter of 2020 was primarily due to a $6.0 million increase in loan servicing fees that was partially offset by a $4.1 million decrease in mortgage warehouse fees. Included in loan servicing fees for the third quarter of 2021 was a $3.0 million positive fair market value adjustment to servicing rights, which compared to a $1.0 million negative fair market value adjustment for the third quarter of 2020.

The 23% increase in noninterest income compared to the second quarter of 2021 was primarily due to a $3.9 million increase in gain on sale of loans and a $3.6 million increase in loan servicing fees. Included in loan servicing fees for the third quarter of 2021 was a $3.0 million positive fair market value adjustment to servicing rights, which compared to a $0.7 million positive fair market value adjustment for the second quarter of 2021.

At September 30, 2021, servicing rights were valued at $105.5 million, an increase of 39% compared to September 30, 2020 and an increase of 7% compared to June 30, 2021. These increases were driven by higher loan balances of serviced assets and higher interest rates that impacted fair market value adjustments in the third quarter of 2021. The value of servicing rights generally increases in rising interest rate environments and declines in falling interest rate environments.

Noninterest Expense

Noninterest expense of $29.5 million for the third quarter of 2021 increased $3.1 million, or 12%, compared to the third quarter of 2020 and increased $1.3 million, or 5%, compared to the second quarter of 2021.

The 12% increase in noninterest expense compared to the third quarter of 2020 was due primarily to a $3.6 million, or 22%, increase in salaries and employee benefits, including commissions, to support higher loan production volumes. The efficiency ratio of 27.0% for the third quarter of 2021 compared to 25.4% for the third quarter of 2020.

The 5% increase in noninterest expense compared to the second quarter of 2021 was primarily due to a $1.3 million, or 7%, increase in salaries and employee benefits that reflected higher commissions from higher loan volumes. The efficiency ratio of 27.0% for the third quarter of 2021 compared to 29.0% for the second quarter of 2021.

Segments

Multi-family Mortgage Banking

For the third quarter of 2021, net income of $14.5 million for Multi-family Mortgage Banking increased 145% compared with the third quarter of 2020, primarily due to higher noninterest income from gain on sale of loans. Noninterest income reflected a positive fair market value adjustment of $0.7 million on servicing rights in the third quarter of 2021 compared to a negative fair market value adjustment of $0.7 million in the third quarter of 2020.

Compared to the second quarter of 2021, net income for this segment increased 32%, reflecting higher gain on sale of loans and loan servicing fees. Included in loan servicing fees was a positive fair market value adjustment of $0.7 million on servicing rights in the third quarter of 2021 compared to a positive fair market value adjustment of $0.1 million in the second quarter of 2021.

Banking

For the third quarter of 2021, net income of $23.5 million for Banking increased 34% from to the third quarter of 2020, reflecting higher net interest income that was partially offset by lower gains on sale of loans. Included in noninterest income for the third quarter of 2021 was a $2.3 million positive fair market value adjustment to servicing rights, which compared to a $0.2 million negative fair market value adjustment for the third quarter of 2020.

Net income for this segment increased 8% from the second quarter of 2021 primarily due to higher net interest income and higher loan servicing fees that were partially offset by an increase in the provision for loan losses. Included in loan servicing fees for the third quarter of 2021 was a $2.3 million positive fair market value adjustment to servicing rights, which compared to a $0.6 million positive fair market value adjustment for the second quarter of 2021.

Mortgage Warehousing

For the third quarter of 2021, net income of $23.2 million for Mortgage Warehousing decreased 31% compared to the third quarter of 2020 and increased 8% compared to the second quarter of 2021. The decreases compared to the prior year period reflected lower net interest income as industry volumes declined.

About Merchants Bancorp

Merchants Bancorp is a diversified bank holding company headquartered in Carmel, Indiana operating multiple lines of business, including Federal Housing Administration ("FHA") multi-family housing and healthcare facility financing and servicing; mortgage warehouse financing; retail and correspondent residential mortgage banking; agricultural lending; and traditional community banking. Merchants Bancorp, with $11.0 billion in assets and $8.9 billion in deposits as of September 30, 2021, conducts its business primarily through its direct and indirect subsidiaries, Merchants Bank of Indiana, Merchants Capital Corp., Farmers-Merchants Bank of Illinois, Merchants Capital Servicing, LLC, and Merchants Mortgage, a division of Merchants Bank of Indiana. For more information and financial data, please visit Merchants’ Investor Relations page at investors.merchantsbancorp.com.

Forward-Looking Statements

This press release contains forward-looking statements which reflect management’s current views with respect to, among other things, future events and financial performance. These statements are often, but not always, made through the use of words or phrases such as "may," "might," "should," "could," "predict," "potential," "believe," "expect," "continue," "will," "anticipate," "seek," "estimate," "intend," "plan," "projection," "goal," "target," "outlook," "aim," "would," "annualized" and "outlook," or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about the industry, management's beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control, such as the potential impacts of the COVID-19 pandemic. Accordingly, management cautions that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. A number of important factors could cause actual results to differ materially from those indicated in these forward-looking statements, including the impacts of the COVID-19 pandemic, such as the severity, magnitude, duration and businesses’ and governments’ responses thereto, on the Company’s operations and personnel, and on activity and demand across its businesses, and other factors identified in "Risk Factors" or "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company’s Annual Report on Form 10-K and other periodic filings with the Securities and Exchange Commission. Any forward-looking statements presented herein are made only as of the date of this press release, and we do not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

MEDIA CONTACT: REBECCA MARSH

Merchants Bancorp

Phone: (317) 805-4356

Email: rmarsh@merchantsbankofindiana.com

INVESTOR CONTACT: JOHN MACKE

Merchants Bancorp

Phone: (317) 536-7421

Email: jmacke@merchantsbankofindiana.com 

⁽¹⁾ Includes $0, $0, $441, $0, and $441, respectively, related to accumulated other comprehensive earnings reclassifications.

⁽²⁾ Includes $0, $0, $(97), $0 and $(97), respectively, related to income tax (expense)/benefit for reclassification items.

(1) Non-GAAP financial measure - see "Reconciliation of Non-GAAP Measures"

(1) Reconciliation of Non-GAAP Financial Measures

Certain non-GAAP financial measures provide useful information to management and investors that is supplementary to the company's financial condition, results of operations and cash flows computed in accordance with GAAP; however, they do have a number of limitations. As such, the reader should not view these disclosures as a substitute for results determined in accordance with GAAP, and they are not necessarily comparable to non-GAAP financial measures that other companies use. A reconciliation of GAAP to non-GAAP financial measures is below. Net Income Available to Common Shareholders excludes preferred stock. Tangible common equity is calculated by excluding the balance of goodwill and other intangible assets and preferred stock from the calculation of total assets. Tangible Assets is calculated by excluding the balance of goodwill and intangible assets. Tangible book value per share is calculated by dividing tangible common equity by the number of shares outstanding.