Company: Level One Bancorp
Symbol: LEVL
Description: Level One Bancorp, Inc. is the bank holding company for Level One Bank, headquartered in Farmington Hills located in Oakland County, Michigan.
Trade Date: 4/20
Shares: 1 million
Price Range: $27.00-$29.00
Underwriter(s): Raymond James, Keefe Bruyette & Woods
Co-Manager(s): Piper Jaffray
Terms Added: 4-12-18
Business: They have grown rapidly since their founding in 2007, and Level One Bank is one of the largest locally-headquartered commercial banks in southeastern Michigan. This growth has been driven primarily by their entrepreneurial culture, their experienced management team and by the economic strength of their core market area in Oakland County, which has the twelfth highest median income in the United States of counties with over one million residents. As of December 31, 2017, they had $1.30 billion in assets, $1.03 billion in loans, $1.12 billion in deposits and total shareholders’ equity of $108.0 million. They generated net income of $9.8 million for the year ended December 31, 2017, or $1.49 per diluted common share, and $11.0 million for the year ended December 31, 2016, or $1.69 per diluted common share.
Financials: Their interest income was $41.3 million, $52.9 million and $55.6 million, their non-interest income was $7.2 million, $6.4 million and $6.5 million, and their net income was $12.4 million, $11.0 million and $9.8 million in 2015, 2016 and 2017, respectively. The decrease of $1.2 million in net income attributable to common shareholders in 2017 primarily reflects an increase in noninterest expense of $3.7 million, partially offset by a decrease in provision for loan losses of $2.5 million. The increase in noninterest expense was primarily due to an increase in salary and employee benefits of $3.6 million, an increase in professional service fees of $1.1 million, and an increase in occupancy and equipment expense of $838 thousand, partially offset by decreases in acquisition and due diligence fees of $2.7 million. The increase in salary and employee benefits in 2017 resulted from an increase of 23 full-time equivalent employees, with a portion of the increase in headcount due to the opening of the Grand Rapids banking center. The increase in professional service fees was due primarily to regulatory and compliance services as a result of their growth and compliance related costs associated with their acquired MSB business.\
Dividends: On March 15, 2018, they declared a quarterly cash dividend of $0.03 per share for shareholders of record on March 31, 2018, payable on April 15, 2018, but they had not historically declared or paid dividends prior to that date. They have no obligation to pay dividends, and they may change their dividend policy at any time without notice to their shareholders. Any future determination to pay dividends on their common stock will be made by their board of directors and will depend upon their results of operations, financial condition, capital requirements, regulatory and contractual restrictions, their business strategy and other factors that their board of directors deems relevant. Subject to those considerations, they currently expect that their board of directors will continue to declare a quarterly cash dividend following the completion of this offering.
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