NINGI Research short Merchants Bancorp, sees potential liquidity problem

In a recently published report, NINGI Research says it is short Merchants Bancorp as its “investigation into this lender uncovered that MBIN has been aggressively expanding its assets base by making bridge loans to mortgage fraudsters, state-barred real estate investors, and negligent landlords. Now, the results of this amoral approach are coming home to roost.” “Given that 99.98% of MBIN’s $6 billion of brokered deposits have a maturity of less than one year, there is a maturity mismatch between MBIN’s CRE loan portfolio and brokered deposits. We believe MBIN will have a significant liquidity problem if only a small percentage of the $6 billion in brokered deposits flows out,” the report reads. NINGI Research believes Merchants Bancorp is “approaching a moment of truth,” and says the stock “should not be trading at a 42% premium to its book value.”