Merchants Bancorp Reports Weak Deposit Growth in Q1 2026 Earnings

Written by Emily J. Thompson, Senior Investment Analyst

Source: PRnewswire

Updated: May 13 2026

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MBIN+2.09%

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Source: PRnewswire

Weak Deposit Growth: Merchants Bancorp reported in its Q1 2026 earnings that while overall deposit growth appeared strong, brokered deposits declined by approximately 50% year-over-year, indicating significant challenges in funding sources that could impact future liquidity and profitability.
Stock Price Drop: Following the earnings release, the company's stock price fell by 9.3% due to the notable decline in brokered deposits and rising funding costs, reflecting market concerns over the company's financial health and potentially diminishing investor confidence.
Insufficient Disclosure: Prior to the Q1 2026 earnings report, Merchants Bancorp's public communications emphasized deposit growth without quantifying the brokered deposit component or its trajectory, which may have led to investor misunderstandings regarding the company's financial status.
Legal Investigation Initiated: An investigation by Levi & Korsinsky is underway to determine whether the company omitted critical information regarding the decline in brokered deposits and the increase in funding costs in its statements about deposit growth, which could expose the company to legal risks and affect its reputation.

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Analyst Views on MBIN

Wall Street analysts forecast MBIN stock price to fall

2 Analyst Rating

1 Buy

1 Hold

0 Sell

Moderate Buy

Current: 46.030

Low

40.00

Averages

41.00

High

42.00

Current: 46.030

Low

40.00

Averages

41.00

High

42.00

Raymond James

Outperform

maintain

$49 -> $51

2026-04-30

Reason

Raymond James

Price Target

$49 -> $51

AI Analysis

2026-04-30

maintain

Outperform

Reason

Raymond James raised the firm's price target on Merchants Bancorp to $51 from $49 and keeps an Outperform rating on the shares. Merchants Bancorp delivered a challenging Q1, as higher interest rates pressured fee income and a smaller balance sheet weighed on net interest income, leading to a PPNR miss and noisy credit trends, the analyst tells investors in a research note. Despite near-term headwinds and reduced EPS estimates, the broader investment thesis remains supported by improving credit costs, expected fee recovery, efficiency gains, and continued tangible book value growth, with the stock still trading at a relative discount to peers, the firm says.

Piper Sandler

Overweight

maintain

$51 -> $58

2026-04-29

Reason

Piper Sandler

Price Target

$51 -> $58

2026-04-29

maintain

Overweight

Reason

Piper Sandler raised the firm's price target on Merchants Bancorp to $58 from $51 and keeps an Overweight rating on the shares. The firm views this as a mixed quarter, with NCOs again relatively elevated and as PPNR was 2% light of expectations. Following Piper's recent discussion with management, the firm gained greater comfort that fraud-related properties have largely been charged-off or appropriately reserved for. As such, Piper still expects that credit costs and problem loan levels will meaningfully inflect lower later this year.

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About MBIN

Merchants Bancorp is a diversified bank holding company. The Company conducts its business primarily through its direct and indirect subsidiaries, Merchants Bank of Indiana, Merchants Capital Corp., Merchants Capital Investments, LLC, Merchants Capital Servicing, LLC, Merchants Asset Management, LLC, and Merchants Mortgage. The Company operates through multiple segments, including Multi-family Mortgage Banking, which primarily offers multifamily housing and healthcare facility financing and servicing (through this segment it also serves as a syndicator of low-income housing tax credit and debt funds); Mortgage Warehousing, which offers mortgage warehouse financing, commercial loans, and deposit services, and Banking, which offers retail and correspondent residential mortgage banking, agricultural lending, and traditional community banking. Merchants Bank of Indiana has seven depository branches located in Carmel, Indianapolis, Lynn, Spartanburg, and Richmond, Indiana.

About the author

Emily J. Thompson

Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.

Merchants Bancorp Q1 Earnings Trigger Stock Price Drop

1 day agoNewsfilter

Misleading Deposit Growth: Merchants Bancorp reported strong deposit growth in Q1 2026; however, GAAP figures revealed a nearly 50% year-over-year decline in brokered deposits, indicating significant issues in the company's funding sources that could impact future liquidity and profitability.
Significant Stock Drop: The revelation of a sharp decline in brokered deposits led to a 9.3% drop in stock price, reflecting investor concerns about the company's financial transparency and the sustainability of its growth narrative.
Investor Legal Actions: Shareholders who suffered losses are encouraged to submit their information to Levi & Korsinsky, indicating potential misleading statements regarding the composition and sustainability of deposit growth, which may lead to further legal actions and regulatory scrutiny.
Rising Funding Costs: The reduction in brokered deposits may lead to increased funding costs for the company, further compressing profit margins and affecting its competitive position and long-term strategic development in the banking sector.

Pomerantz LLP Investigates Merchants Bancorp for Securities Fraud

6 days agoPRnewswire

Securities Fraud Investigation: Pomerantz LLP is investigating Merchants Bancorp and its executives for potential involvement in securities fraud or other unlawful business practices, which could severely undermine investor confidence.
Financial Performance Decline: In its Q1 2026 report, Merchants Bancorp disclosed a roughly 50% year-over-year decline in brokered deposits and a significant rise in funding costs, indicating serious financial challenges that may affect its future financing capabilities.
Stock Price Plunge: Following the earnings report, Merchants Bancorp's stock price fell by $4.63, or 9.33%, closing at $45.00 per share on April 29, 2026, reflecting market concerns over the company's financial health.
Legal Action Risks: The ongoing investigation exposes Merchants Bancorp to potential class action lawsuits, which could lead to substantial damages and adversely affect the company's reputation and future business operations.

Merchants Bancorp Q1 2026 Earnings Report Impact

May 14 2026Newsfilter

Performance Decline: Merchants Bancorp's Q1 2026 earnings report revealed a sharp 50% year-over-year decline in brokered deposits and a significant rise in funding costs, resulting in a 9.3% drop in share price, directly undermining investor confidence.
Insufficient Disclosure: While prior SEC filings included executive compensation, net income, and return-on-equity metrics, they failed to address the decline in brokered deposits and its impact on earnings, potentially misleading investors about the company's financial health.
Legal Investigation Initiated: Levi & Korsinsky is investigating whether Merchants Bancorp inadequately disclosed material trends affecting its deposit base and funding costs, raising potential securities fraud allegations and increasing market uncertainty.
Investor Action Recommendations: Affected MBIN shareholders are encouraged to gather trading records and contact the law firm for a free evaluation, indicating that the company's legal risks could impact future shareholder value.