Mackinac Financial Corporation was incorporated under the laws of the state
of Michigan on December 16, 1974. The Corporation changed its name from “First
Manistique Corporation” to “North Country Financial Corporation”
on April 14, 1998. On December 16, 2004, the Corporation changed its name from
North Country Financial Corporation to Mackinac Financial Corporation. The Corporation
is headquartered and located in Manistique, Michigan. The mailing address of
the Corporation is 130 South Cedar Street, Manistique, Michigan 49854.
The Corporation owns all of the outstanding stock of its banking subsidiary,
mBank (the “Bank”). The Bank currently has 13 branch offices located
in the Upper Peninsula of Michigan and 4 branch offices located in Michigan’s
Lower Peninsula. The Bank maintains offices in Chippewa, Grand Traverse, Luce,
Manistee, Marquette, Menominee, Oakland, Otsego, and Schoolcraft Counties. The
Bank provides drive-in convenience at 12 branch locations and has 22 automated
teller machines. The Bank has no foreign offices.
The Corporation also owns three non-bank subsidiaries: First Manistique Agency,
presently inactive; First Rural Relending Company, a relending company for nonprofit
organizations; and North Country Capital Trust, a statutory business trust which
was formed solely for the issuance of trust preferred securities. The Bank represents
the principal asset of the Corporation. The Bank has one wholly owned subsidiary,
mBank Title Insurance Agency, LLC, which provided title insurance services until
2014 and is currently inactive. The Corporation and its subsidiary Bank are
engaged in a single industry segment, commercial banking, broadly defined to
include commercial and retail banking activities, along with other permitted
activities closely related to banking.
The principal business of the Corporation is the general commercial banking
business, conducted through the Bank’s provision of a full range of loan
and deposit products. These banking services include customary retail and commercial
banking services, including checking and savings accounts, time deposits, interest
bearing transaction accounts, safe deposit facilities, real estate mortgage
lending, commercial lending, commercial and governmental lease financing, and
direct and indirect consumer financing. Funds for the Bank’s operation
are also provided by brokered deposits and through borrowings from the Federal
Home Loan Bank (“FHLB”) system, proceeds from the sale of loans
and mortgage-backed and other securities, funds from repayment of outstanding
loans and earnings from operations. Earnings depend primarily upon the difference
between (i) revenues from loans, investments, and other interest-bearing assets
and (ii) expenses incurred in payment of interest on deposit accounts and borrowings,
maintaining an adequate allowance for loan losses, and general operating expenses.
The Bank makes mortgage, commercial, and installment loans to customers throughout
Michigan. Fees may be charged for these services. The Bank’s most prominent
concentration in the loan portfolio relates to commercial loans to entities
within the real estate — operators of nonresidential buildings industry.
The Bank also supports the service industry, with its hospitality and related
businesses, as well as gaming, forestry, restaurants, farming, fishing, and
many other activities important to growth in Michigan. The economy of the Bank’s
market areas is affected by summer and winter tourism activities.
The Bank has become a premier SBA/USDA lender in the State of Michigan. Many
of these SBA/USDA guaranteed loans are sold at a premium on the secondary market,
with the Bank retaining the servicing. The Bank does not sell the loan guarantees
on every credit, rather only those where acceptable market rates are above par.
The Bank also offers various consumer loan products including installment, mortgages
and home equity loans. In addition to making consumer portfolio loans, the Bank
engages in the business of making residential mortgage loans for sale to the
secondary market.
The Bank’s primary source for lending, investments, and other general
business purposes is deposits. The Bank offers a wide range of interest bearing
and non-interest bearing accounts, including commercial and retail checking
accounts, negotiable order of withdrawal (“NOW”) accounts, money
market accounts with limited transactions, individual retirement accounts, regular
interest-bearing statement savings accounts, certificates of deposit with a
range of maturity date options, and accessibility to a customer’s deposit
relationship through online banking. The sources of deposits are residents,
businesses and employees of businesses within the Bank’s market areas,
obtained through the personal solicitation of the Bank’s officers and
directors, direct mail solicitation and limited advertisements published in
the local media. The Bank also utilizes the wholesale deposit market for any
shortfalls in loan funding. No material portions of the Bank’s deposits
have been received from a single person, industry, group, or geographical location.
The Bank is a member of the FHLB. The FHLB provides an additional source of
liquidity and long-term funds. Membership in the FHLB has provided access to
attractive rate advances, as well as advantageous lending programs. The Community
Investment Program makes advances to be used for funding community-oriented
mortgage lending, and the Affordable Housing Program grants advances to fund
lending for long-term low and moderate income owner occupied and affordable
rental housing at subsidized interest rates.
%
0.82% 