Like several other Michigan banking companies, Independent Bank Corp. in Ionia is attributing a steep drop in first-quarter profits in large part to the state's sluggish economy.

Independent announced Monday that its net income from continuing operations fell 67% from the same quarter last year, to $4.3 million.

Diluted earnings per share fell 66%, to 19 cents, which missed the average of analysts' expectations by 21 cents, according to Thomson Financial.

This month Chemical Financial Corp. of Midland, Mercantile Bank Corp. of Grand Rapids, and Capitol Bancorp Ltd. of Lansing have cited the depressed Michigan economy and the general interest rate climate as the primary reasons their first-quarter earnings dropped from the same quarter last year.

Michigan has lost hundreds of thousands of jobs this decade, mostly in manufacturing.

The $3.4 billion-asset Independent said its net interest income dropped 27% from a year earlier, to $22.1 million. Its provision for loan losses rose 440%, to $7.5 million. Deposit costs increased 41%, to $22.4 million.

In March, Independent closed a deal to purchase three branches from TCF Financial Corp. of Wayzata, Minn. The purchase added $241.4 million to Independent's deposits.

Its noninterest income dropped 15%, to $10.7 million. Noninterest expenses rose 7%, to $28 million.

Independent's shares were down 12.8% late Monday, to $16.76. Adjusted for splits, the stock is trading at its lowest level in four years.

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