Independent Bank Corporation (NASDAQ: IBCP) to Acquire HCB Financial Corp. in Strategic \$70 Million Merger

Key Highlights from the Announcement

• Definitive Merger Agreement: Independent Bank Corporation (“Independent”), parent of Independent Bank, has entered into a definitive agreement to acquire HCB Financial Corp. (“HCB”), parent of Highpoint Community Bank, in a cash and stock transaction valued at approximately \$70.2 million.
• Transaction Structure: Each HCB shareholder will receive 1.590 shares of Independent common stock plus \$17.51 in cash per HCB share. Based on Independent’s closing price of \$33.13 (as of March 17, 2026), the deal values HCB at \$70.2 million.
• Impact on Combined Organization: After the transaction, the combined entity will have approximately \$6.1 billion in total assets, \$5.3 billion in deposits, and \$4.7 billion in loans (as of December 31, 2025).
• Board Representation: One HCB director will join the boards of both Independent and Independent Bank, increasing each to 11 members.
• Expected Timeline: Closing is anticipated early in the third quarter of 2026, subject to regulatory approvals and HCB shareholder approval.
• Accretion and Dilution: The deal is expected to be approximately 6% accretive to Independent’s 2027 EPS, with an estimated tangible book value per share dilution of 4% at closing, expected to be earned back in 3.4 years using the crossover method.
• Capital Position: Post-closing CET1 ratio is projected to be 11.5%.

Strategic Rationale and Shareholder Implications

Why This Merger Matters

• Market Density & Geographic Expansion: Highpoint’s seven branches will bridge a geographic gap between Independent’s Grand Rapids and Lansing hubs, strengthening the company’s position in a high-growth Michigan corridor.
• Superior Funding Profile: HCB brings a high-quality, low-cost deposit base (1.50% cost of deposits) and a loan-to-deposit ratio of 67%, enhancing Independent’s liquidity profile.
• Cultural Alignment & Low Integration Risk: Both banks share a focus on local, entrepreneurial decision-making and prudent underwriting. Similar business models and systems mean integration risk is low.
• Expanded Capabilities: Highpoint clients will gain access to a broader product suite and larger lending limits.

Potentially Price-Sensitive Details

• Accretion to EPS: Expected 6% accretion to 2027 EPS could be positively viewed by the market, potentially boosting share price.
• Book Value Impact: The 4% dilution in tangible book value per share, with an earn-back period of 3.4 years, is important for valuation-sensitive investors.
• Capital Strength: Projected CET1 ratio of 11.5% post-closing demonstrates continued strong capitalization.
• Board Changes: Addition of HCB representation to Independent’s board may influence future strategic direction.
• Regulatory and Shareholder Approvals: The deal is still subject to approvals; failure to close could result in volatility.

Background on the Companies

Independent Bank Corporation

Independent Bank Corporation (NASDAQ: IBCP), founded in 1864, operates 59 branches across Michigan’s Lower Peninsula with approximately \$5.5 billion in assets. It provides a full suite of retail and commercial banking, mortgage, and investment services.

HCB Financial Corp.

HCB Financial Corp. (OTCPK: HCBN) is the parent of Highpoint Community Bank, headquartered in Hastings, Michigan, with 7 branches, \$590 million in assets, \$532 million in deposits, and \$354 million in loans. Highpoint is known for its relationship-based community banking approach.

Next Steps and Shareholder Information

• Independent will file a registration statement (Form S-4) with the SEC, including a proxy statement/prospectus for HCB shareholders.
• HCB shareholders are strongly encouraged to review all forthcoming proxy materials and SEC filings carefully prior to voting on the merger.
• A conference call to discuss the transaction will be held on March 19, 2026, at 9:00am ET. Details for access are available online.
• Additional details and free copies of filings may be obtained from the SEC’s website or directly from Independent or HCB upon request.

Risks and Forward-Looking Statements

• The merger is subject to various risks, including failure to obtain regulatory or shareholder approvals, integration risks, and the possibility that anticipated financial benefits are not realized as expected.
• Forward-looking statements are based on current assumptions and actual results may differ materially due to a variety of factors, including market conditions and regulatory developments.

Contacts for Further Information

• Independent Bank Corporation: William B. Kessel, President and CEO, 616.447.3929; Gavin A. Mohr, CFO, 616.447.3929
• HCB Financial Corp.: Mark Kolanowski, President and CEO, 269.945.2401

Disclaimer: This article is for informational purposes only and does not constitute investment advice or an offer to buy or sell securities. Investors should review all official filings and consult with their financial advisors before making any investment decisions. Forward-looking statements are subject to risks and uncertainties and actual results may differ materially.

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