MUNCIE, Ind., Oct. 24, 2024 (GLOBE NEWSWIRE) -- First Merchants Corporation (NASDAQ - FRME)
Third Quarter 2024 Highlights:
- Net income available to common stockholders was $48.7 million and diluted earnings per common share totaled $0.84, compared to $55.9 million and $0.94 in the third quarter of 2023, and $39.5 million and $0.68 in the second quarter of 2024.Excluding the loss from repositioning of the available for sale securities portfolio, adjusted net income was $55.6 million or $0.95 per share for the third quarter of 2024.
- Strong capital position with Common Equity Tier 1 Capital Ratio of 11.25% and Tangible Common Equity to Tangible Assets Ratio of 8.76%.
- Net interest margin was 3.23% compared to 3.16% on a linked quarter basis.
- Total loans grew $15.5 million, or 0.5% annualized, on a linked quarter basis, and $385.1 million, or 3.1% during the last twelve months.
- Total deposits grew by $83.7 million, or 2.3% annualized, on a linked quarter basis after normalizing for $287.7 million of deposits reclassified to held for sale.
- Nonperforming assets to total assets were 35 basis points compared to 36 basis points on a linked quarter basis.
- The efficiency ratio totaled 53.76% for the quarter.
- Announced sale of five Illinois branches and certain loans and deposits to Old Second National Bank on August 27, 2024.
"We are pleased with our third quarter results and the focused momentum that we are building," said Mark Hardwick, Chief Executive Officer. "The pending sale of five non-core Illinois branches, restructure of the securities portfolio, and successful completion of four major technology initiatives provides us with the opportunity to reprioritize our core markets and introduce innovative customer acquisition strategies."
Third Quarter Financial Results:
First Merchants Corporation (the "Corporation") has reported third quarter 2024 net income available to common stockholders of $48.7 million compared to $55.9 million during the same period in 2023. Diluted earnings per common share for the period totaled $0.84 compared to the third quarter of 2023 result of $0.94. Excluding the $9.1 million pre-tax loss from repositioning of the available for sale securities portfolio, adjusted net income was $55.6 million, or $0.95 diluted earnings per common share for the third quarter of 2024.
During the quarter, the Corporation signed a definitive agreement to sell five Illinois branches along with certain loans and deposits, representing an exit from suburban Chicago markets. Loans of $9.2 million, deposits of $287.7 million and fixed assets of $3.4 million have been moved to held for sale categories as of September 30, 2024. The transaction is expected to close in the fourth quarter of this year.
Total assets equaled $18.3 billion as of quarter-end and loans totaled $12.7 billion. During the past twelve months, total loans grew by $385.1 million, or 3.1%. On a linked quarter basis, loans grew $15.5 million, or 0.5%, with growth primarily in commercial & industrial loans.
Investments totaling $3.7 billion decreased $51.6 million, or 1.4%, during the last twelve months and decreased $90.9 million, or 9.7% annualized, on a linked quarter basis. The decline during the quarter was due to $158.9 million in sales of available for sale securities with a weighted average tax-equivalent yield of 2.85%, partially offset by an increase in the securities portfolio valuation.
Total deposits were $14.4 billion as of quarter-end and decreased by $281.5 million, or 1.9%, over the past twelve months. The decline was primarily due to $287.7 million of deposits being reclassified to held for sale. Excluding this impact, deposits increased by $6.2 million. On a linked quarter basis, deposits grew organically by $83.7 million or 2.3%. The loan to deposit ratio increased to 88.0% at period end from 86.8% in the prior quarter, primarily due to the reclassification of deposits to held for sale as previously described.
The Corporation's Allowance for Credit Losses - Loans (ACL) totaled $187.8 million as of quarter-end, or 1.48% of total loans, a decrease of $1.7 million from prior quarter. Loan charge-offs, net of recoveries totaled $6.7 million and provision for loans of $5.0 million was recorded during the quarter. Reserves for unfunded commitments totaled $19.5 million and remained unchanged from the prior quarter. Non-performing assets to total assets were 35 basis points for the third quarter of 2024, a decrease of one basis point compared to 36 basis points in the prior quarter.
Net interest income totaled $131.1 million for the quarter, an increase of $2.5 million, or 2.0%, compared to prior quarter and a decrease of $2.3 million, or 1.7%, compared to the third quarter of 2023. Fully-tax equivalent net interest margin was 3.23%, an increase of 7 basis points compared to the second quarter of 2024, and a decrease of 6 basis points compared to the third quarter of 2023. The increase in net interest margin compared to the second quarter was due to higher earning asset yields.
Non-interest income totaled $24.9 million for the quarter, a decrease of $6.5 million, or 20.6%, compared to the second quarter of 2024 and a decrease of $3.0 million, or 6.7% from the third quarter of 2023. The decrease from second quarter of 2024 was driven by realized losses on sales of available for sale securities associated with the repositioning of the bond portfolio, partially offset by increases in gains on sales of mortgage loans and earnings on cash surrender value of life insurance.
Non-interest expense totaled $94.6 million for the quarter, an increase of $3.2 million from the second quarter of 2024 and an increase of $0.8 million from the third quarter of 2023. The increase from the linked quarter was from higher salaries and employee benefits primarily driven by higher incentives.
The Corporation's total risk-based capital ratio equaled 13.18%, common equity tier 1 capital ratio equaled 11.25%, and the tangible common equity ratio totaled 8.76%. These ratios continue to reflect the Corporation's strong liquidity and capital positions.
CONFERENCE CALL
First Merchants Corporation will conduct a third quarter earnings conference call and web cast at 11:30 a.m. (ET) on Thursday, October 24, 2024.
To access via phone, participants will need to register using the following link where they will be provided a phone number and access code: (https://register.vevent.com/register/BI34430e309ed545808c7c8195f36e86b6)
To view the webcast and presentation slides, please go to (https://edge.media-server.com/mmc/p/6grv3upw) during the time of the call. A replay of the webcast will be available until October 24, 2025.
Detailed financial results are reported on the attached pages.
About First Merchants Corporation
First Merchants Corporation is a financial holding company headquartered in Muncie, Indiana. The Corporation has one full-service bank charter, First Merchants Bank. The Bank also operates as First Merchants Private Wealth Advisors (as a division of First Merchants Bank).
First Merchants Corporation's common stock is traded on the NASDAQ Global Select Market System under the symbol FRME. Quotations are carried in daily newspapers and can be found on the company's Internet web page (http://www.firstmerchants.com).
FIRST MERCHANTS and the Shield Logo are federally registered trademarks of First Merchants Corporation.
Forward-Looking Statements
This release contains forward-looking statements made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements can often, but not always, be identified by the use of words like "believe", "continue", "pattern", "estimate", "project", "intend", "anticipate", "expect" and similar expressions or future or conditional verbs such as "will", "would", "should", "could", "might", "can", "may", or similar expressions. These statements include statements about First Merchants' goals, intentions and expectations; statements regarding the First Merchants' business plan and growth strategies; statements regarding the asset quality of First Merchants' loan and investment portfolios; and estimates of First Merchants' risks and future costs and benefits. These forward-looking statements are subject to significant risks, assumptions and uncertainties that may cause results to differ materially from those set forth in forward-looking statements, including, among other things: possible changes in monetary and fiscal policies, and laws and regulations; the effects of easing restrictions on participants in the financial services industry; the cost and other effects of legal and administrative cases; possible changes in the credit worthiness of customers and the possible impairment of collectability of loans; fluctuations in market rates of interest; competitive factors in the banking industry; changes in the banking legislation or regulatory requirements of federal and state agencies applicable to bank holding companies and banks like First Merchants' affiliate bank; continued availability of earnings and excess capital sufficient for the lawful and prudent declaration of dividends; changes in market, economic, operational, liquidity (including the ability to grow and maintain core deposits and retain large, uninsured deposits), credit and interest rate risks associated with the First Merchants' business; and other risks and factors identified in each of First Merchants' filings with the Securities and Exchange Commission. First Merchants does not undertake any obligation to update any forward-looking statement, whether written or oral, relating to the matters discussed in this press release. In addition, First Merchants' past results of operations do not necessarily indicate its anticipated future results.
| CONSOLIDATED BALANCE SHEETS | |||||||
| (Dollars In Thousands) | September 30, | ||||||
| 2024 | 2023 | ||||||
| ASSETS | |||||||
| Cash and due from banks | $ | 84,719 | $ | 125,173 | |||
| Interest-bearing deposits | 359,126 | 348,639 | |||||
| Investment securities, net of allowance for credit losses of $245,000 and $245,000 | 3,662,145 | 3,713,724 | |||||
| Loans held for sale | 40,652 | 30,972 | |||||
| Loans | 12,646,808 | 12,271,422 | |||||
| Less: Allowance for credit losses - loans | (187,828 | ) | (205,782 | ) | |||
| Net loans | 12,458,980 | 12,065,640 | |||||
| Premises and equipment | 129,582 | 132,441 | |||||
| Federal Home Loan Bank stock | 41,716 | 41,797 | |||||
| Interest receivable | 92,055 | 90,011 | |||||
| Goodwill and other intangibles | 733,601 | 741,283 | |||||
| Cash surrender value of life insurance | 304,613 | 306,106 | |||||
| Other real estate owned | 5,247 | 6,480 | |||||
| Tax asset, deferred and receivable | 86,732 | 135,521 | |||||
| Other assets | 348,384 | 340,476 | |||||
| TOTAL ASSETS | $ | 18,347,552 | $ | 18,078,263 | |||
| LIABILITIES | |||||||
| Deposits: | |||||||
| Noninterest-bearing | $ | 2,334,197 | $ | 2,554,984 | |||
| Interest-bearing | 12,030,903 | 12,091,592 | |||||
| Total Deposits | 14,365,100 | 14,646,576 | |||||
| Borrowings: | |||||||
| Federal funds purchased | 30,000 | - | |||||
| Securities sold under repurchase agreements | 124,894 | 152,537 | |||||
| Federal Home Loan Bank advances | 832,629 | 713,384 | |||||
| Subordinated debentures and other borrowings | 93,562 | 158,665 | |||||
| Total Borrowings | 1,081,085 | 1,024,586 | |||||
| Deposits and other liabilities held for sale | 288,476 | - | |||||
| Interest payable | 18,089 | 16,473 | |||||
| Other liabilities | 292,429 | 297,984 | |||||
| Total Liabilities | 16,045,179 | 15,985,619 | |||||
| STOCKHOLDERS' EQUITY | |||||||
| Preferred Stock, $1,000 par value, $1,000 liquidation value: | |||||||
| Authorized -- 600 cumulative shares | |||||||
| Issued and outstanding - 125 cumulative shares | 125 | 125 | |||||
| Preferred Stock, Series A, no par value, $2,500 liquidation preference: | |||||||
| Authorized -- 10,000 non-cumulative perpetual shares | |||||||
| Issued and outstanding - 10,000 non-cumulative perpetual shares | 25,000 | 25,000 | |||||
| Common Stock, $.125 stated value: | |||||||
| Authorized -- 100,000,000 shares | |||||||
| Issued and outstanding - 58,117,115 and 59,398,022 shares | 7,265 | 7,425 | |||||
| Additional paid-in capital | 1,192,683 | 1,234,402 | |||||
| Retained earnings | 1,229,125 | 1,132,962 | |||||
| Accumulated other comprehensive loss | (151,825 | ) | (307,270 | ) | |||
| Total Stockholders' Equity | 2,302,373 | 2,092,644 | |||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 18,347,552 | $ | 18,078,263 | |||
| CONSOLIDATED STATEMENTS OF INCOME | Three Months Ended | Nine Months Ended | |||||||||||||
| (Dollars In Thousands, Except Per Share Amounts) | September 30, | September 30, | |||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| INTEREST INCOME | |||||||||||||||
| Loans receivable: | |||||||||||||||
| Taxable | $ | 206,680 | $ | 191,705 | $ | 606,116 | $ | 550,314 | |||||||
| Tax-exempt | 8,622 | 8,288 | 25,242 | 23,757 | |||||||||||
| Investment securities: | |||||||||||||||
| Taxable | 9,263 | 8,590 | 27,062 | 26,563 | |||||||||||
| Tax-exempt | 13,509 | 13,947 | 40,733 | 44,296 | |||||||||||
| Deposits with financial institutions | 2,154 | 5,884 | 11,642 | 9,685 | |||||||||||
| Federal Home Loan Bank stock | 855 | 719 | 2,569 | 2,281 | |||||||||||
| Total Interest Income | 241,083 | 229,133 | 713,364 | 656,896 | |||||||||||
| INTEREST EXPENSE | |||||||||||||||
| Deposits | 98,856 | 85,551 | 296,292 | 209,437 | |||||||||||
| Federal funds purchased | 329 | - | 455 | 1,420 | |||||||||||
| Securities sold under repurchase agreements | 700 | 797 | 2,377 | 2,624 | |||||||||||
| Federal Home Loan Bank advances | 8,544 | 6,896 | 21,715 | 20,775 | |||||||||||
| Subordinated debentures and other borrowings | 1,544 | 2,506 | 5,781 | 7,303 | |||||||||||
| Total Interest Expense | 109,973 | 95,750 | 326,620 | 241,559 | |||||||||||
| NET INTEREST INCOME | 131,110 | 133,383 | 386,744 | 415,337 | |||||||||||
| Provision for credit losses | 5,000 | 2,000 | 31,500 | 2,000 | |||||||||||
| NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES | 126,110 | 131,383 | 355,244 | 413,337 | |||||||||||
| NONINTEREST INCOME | |||||||||||||||
| Service charges on deposit accounts | 8,361 | 7,975 | 24,482 | 23,147 | |||||||||||
| Fiduciary and wealth management fees | 8,525 | 7,394 | 25,550 | 22,653 | |||||||||||
| Card payment fees | 5,121 | 4,716 | 14,360 | 14,425 | |||||||||||
| Net gains and fees on sales of loans | 6,764 | 5,517 | 15,159 | 11,548 | |||||||||||
| Derivative hedge fees | 736 | 516 | 1,488 | 2,336 | |||||||||||
| Other customer fees | 344 | 384 | 1,231 | 1,643 | |||||||||||
| Earnings on cash surrender value of life insurance | 2,755 | 1,761 | 6,276 | 5,145 | |||||||||||
| Net realized losses on sales of available for sale securities | (9,114 | ) | (1,650 | ) | (9,165 | ) | (4,613 | ) | |||||||
| Other income | 1,374 | 1,229 | 3,457 | 2,874 | |||||||||||
| Total Noninterest Income | 24,866 | 27,842 | 82,838 | 79,158 | |||||||||||
| NONINTEREST EXPENSES | |||||||||||||||
| Salaries and employee benefits | 55,223 | 55,566 | 165,730 | 167,778 | |||||||||||
| Net occupancy | 6,994 | 6,837 | 21,052 | 20,770 | |||||||||||
| Equipment | 6,949 | 5,698 | 19,774 | 18,005 | |||||||||||
| Marketing | 1,836 | 2,369 | 4,807 | 4,780 | |||||||||||
| Outside data processing fees | 7,150 | 6,573 | 21,111 | 19,290 | |||||||||||
| Printing and office supplies | 378 | 333 | 1,085 | 1,150 | |||||||||||
| Intangible asset amortization | 1,772 | 2,182 | 5,500 | 6,561 | |||||||||||
| FDIC assessments | 3,720 | 2,981 | 11,285 | 7,117 | |||||||||||
| Other real estate owned and foreclosure expenses | 942 | 677 | 1,849 | 1,575 | |||||||||||
| Professional and other outside services | 3,035 | 3,833 | 10,809 | 12,191 | |||||||||||
| Other expenses | 6,630 | 6,805 | 19,975 | 20,950 | |||||||||||
| Total Noninterest Expenses | 94,629 | 93,854 | 282,977 | 280,167 | |||||||||||
| INCOME BEFORE INCOME TAX | 56,347 | 65,371 | 155,105 | 212,328 | |||||||||||
| Income tax expense | 7,160 | 9,005 | 18,052 | 31,021 | |||||||||||
| NET INCOME | 49,187 | 56,366 | 137,053 | 181,307 | |||||||||||
| Preferred stock dividends | 468 | 468 | 1,406 | 1,406 | |||||||||||
| NET INCOME AVAILABLE TO COMMON STOCKHOLDERS | $ | 48,719 | $ | 55,898 | $ | 135,647 | $ | 179,901 | |||||||
| Per Share Data: | |||||||||||||||
| Basic Net Income Available to Common Stockholders | $ | 0.84 | $ | 0.95 | $ | 2.32 | $ | 3.04 | |||||||
| Diluted Net Income Available to Common Stockholders | $ | 0.84 | $ | 0.94 | $ | 2.31 | $ | 3.03 | |||||||
| Cash Dividends Paid to Common Stockholders | $ | 0.35 | $ | 0.34 | $ | 1.04 | $ | 1.00 | |||||||
| Average Diluted Common Shares Outstanding (in thousands) | 58,289 | 59,503 | 58,629 | 59,465 | |||||||||||
| FINANCIAL HIGHLIGHTS | |||||||||||||||
| (Dollars in thousands) | Three Months Ended | Nine Months Ended | |||||||||||||
| September 30, | September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| NET CHARGE-OFFS | $ | 6,709 | $ | 20,365 | $ | 48,606 | $ | 22,495 | |||||||
| AVERAGE BALANCES: | |||||||||||||||
| Total Assets | $ | 18,360,580 | $ | 18,152,239 | $ | 18,374,370 | $ | 18,115,504 | |||||||
| Total Loans | 12,680,166 | 12,287,632 | 12,592,907 | 12,264,787 | |||||||||||
| Total Earning Assets | 16,990,358 | 16,947,669 | 17,042,540 | 16,913,965 | |||||||||||
| Total Deposits | 14,702,454 | 14,735,592 | 14,826,056 | 14,627,448 | |||||||||||
| Total Stockholders' Equity | 2,251,547 | 2,154,232 | 2,232,419 | 2,126,005 | |||||||||||
| FINANCIAL RATIOS: | |||||||||||||||
| Return on Average Assets | 1.07 | % | 1.24 | % | 0.99 | % | 1.33 | % | |||||||
| Return on Average Stockholders' Equity | 8.66 | 10.38 | 8.10 | 11.28 | |||||||||||
| Return on Tangible Common Stockholders' Equity | 13.39 | 16.54 | 12.64 | 18.10 | |||||||||||
| Average Earning Assets to Average Assets | 92.54 | 93.36 | 92.75 | 93.37 | |||||||||||
| Allowance for Credit Losses - Loans as % of Total Loans | 1.48 | 1.67 | 1.48 | 1.67 | |||||||||||
| Net Charge-offs as % of Average Loans (Annualized) | 0.21 | 0.66 | 0.51 | 0.24 | |||||||||||
| Average Stockholders' Equity to Average Assets | 12.26 | 11.87 | 12.15 | 11.74 | |||||||||||
| Tax Equivalent Yield on Average Earning Assets | 5.82 | 5.55 | 5.72 | 5.32 | |||||||||||
| Interest Expense/Average Earning Assets | 2.59 | 2.26 | 2.56 | 1.90 | |||||||||||
| Net Interest Margin (FTE) on Average Earning Assets | 3.23 | 3.29 | 3.16 | 3.42 | |||||||||||
| Efficiency Ratio | 53.76 | 53.91 | 55.54 | 52.60 | |||||||||||
| Tangible Common Book Value Per Share | $ | 26.64 | $ | 22.43 | $ | 26.64 | $ | 22.43 | |||||||
| NONPERFORMING ASSETS | |||||||||||||||||||
| (Dollars In Thousands) | September 30, | June 30, | March 31, | December 31, | September 30, | ||||||||||||||
| 2024 | 2024 | 2024 | 2023 | 2023 | |||||||||||||||
| Nonaccrual Loans | $ | 59,088 | $ | 61,906 | $ | 62,478 | $ | 53,580 | $ | 53,102 | |||||||||
| Other Real Estate Owned and Repossessions | 5,247 | 4,824 | 4,886 | 4,831 | 6,480 | ||||||||||||||
| Nonperforming Assets (NPA) | 64,335 | 66,730 | 67,364 | 58,411 | 59,582 | ||||||||||||||
| 90+ Days Delinquent | 14,105 | 1,686 | 2,838 | 172 | 89 | ||||||||||||||
| NPAs & 90 Day Delinquent | $ | 78,440 | $ | 68,416 | $ | 70,202 | $ | 58,583 | $ | 59,671 | |||||||||
| Allowance for Credit Losses - Loans | $ | 187,828 | $ | 189,537 | $ | 204,681 | $ | 204,934 | $ | 205,782 | |||||||||
| Quarterly Net Charge-offs | 6,709 | 39,644 | 2,253 | 3,148 | 20,365 | ||||||||||||||
| NPAs / Actual Assets % | 0.35 | % | 0.36 | % | 0.37 | % | 0.32 | % | 0.33 | % | |||||||||
| NPAs & 90 Day / Actual Assets % | 0.43 | % | 0.37 | % | 0.38 | % | 0.32 | % | 0.33 | % | |||||||||
| NPAs / Actual Loans and OREO % | 0.51 | % | 0.53 | % | 0.54 | % | 0.47 | % | 0.48 | % | |||||||||
| Allowance for Credit Losses - Loans / Actual Loans (%) | 1.48 | % | 1.50 | % | 1.64 | % | 1.64 | % | 1.67 | % | |||||||||
| Net Charge-offs as % of Average Loans (Annualized) | 0.21 | % | 1.26 | % | 0.07 | % | 0.10 | % | 0.66 | % | |||||||||
| CONSOLIDATED BALANCE SHEETS | |||||||||||||||||||
| (Dollars In Thousands) | September 30, | June 30, | March 31, | December 31, | September 30, | ||||||||||||||
| 2024 | 2024 | 2024 | 2023 | 2023 | |||||||||||||||
| ASSETS | |||||||||||||||||||
| Cash and due from banks | $ | 84,719 | $ | 105,372 | $ | 100,514 | $ | 112,649 | $ | 125,173 | |||||||||
| Interest-bearing deposits | 359,126 | 168,528 | 410,497 | 436,080 | 348,639 | ||||||||||||||
| Investment securities, net of allowance for credit losses | 3,662,145 | 3,753,088 | 3,783,574 | 3,811,364 | 3,713,724 | ||||||||||||||
| Loans held for sale | 40,652 | 32,292 | 15,118 | 18,934 | 30,972 | ||||||||||||||
| Loans | 12,646,808 | 12,639,650 | 12,465,582 | 12,486,027 | 12,271,422 | ||||||||||||||
| Less: Allowance for credit losses - loans | (187,828 | ) | (189,537 | ) | (204,681 | ) | (204,934 | ) | (205,782 | ) | |||||||||
| Net loans | 12,458,980 | 12,450,113 | 12,260,901 | 12,281,093 | 12,065,640 | ||||||||||||||
| Premises and equipment | 129,582 | 133,245 | 132,706 | 133,896 | 132,441 | ||||||||||||||
| Federal Home Loan Bank stock | 41,716 | 41,738 | 41,758 | 41,769 | 41,797 | ||||||||||||||
| Interest receivable | 92,055 | 97,546 | 92,550 | 97,664 | 90,011 | ||||||||||||||
| Goodwill and other intangibles | 733,601 | 735,373 | 737,144 | 739,101 | 741,283 | ||||||||||||||
| Cash surrender value of life insurance | 304,613 | 306,379 | 306,028 | 306,301 | 306,106 | ||||||||||||||
| Other real estate owned | 5,247 | 4,824 | 4,886 | 4,831 | 6,480 | ||||||||||||||
| Tax asset, deferred and receivable | 86,732 | 107,080 | 101,121 | 99,883 | 135,521 | ||||||||||||||
| Other assets | 348,384 | 367,845 | 331,006 | 322,322 | 340,476 | ||||||||||||||
| TOTAL ASSETS | $ | 18,347,552 | $ | 18,303,423 | $ | 18,317,803 | $ | 18,405,887 | $ | 18,078,263 | |||||||||
| LIABILITIES | |||||||||||||||||||
| Deposits: | |||||||||||||||||||
| Noninterest-bearing | $ | 2,334,197 | $ | 2,303,313 | $ | 2,338,364 | $ | 2,500,062 | $ | 2,554,984 | |||||||||
| Interest-bearing | 12,030,903 | 12,265,757 | 12,546,220 | 12,321,391 | 12,091,592 | ||||||||||||||
| Total Deposits | 14,365,100 | 14,569,070 | 14,884,584 | 14,821,453 | 14,646,576 | ||||||||||||||
| Borrowings: | |||||||||||||||||||
| Federal funds purchased | 30,000 | 147,229 | - | - | - | ||||||||||||||
| Securities sold under repurchase agreements | 124,894 | 100,451 | 130,264 | 157,280 | 152,537 | ||||||||||||||
| Federal Home Loan Bank advances | 832,629 | 832,703 | 612,778 | 712,852 | 713,384 | ||||||||||||||
| Subordinated debentures and other borrowings | 93,562 | 93,589 | 118,612 | 158,644 | 158,665 | ||||||||||||||
| Total Borrowings | 1,081,085 | 1,173,972 | 861,654 | 1,028,776 | 1,024,586 | ||||||||||||||
| Deposits and other liabilities held for sale | 288,476 | - | - | - | - | ||||||||||||||
| Interest payable | 18,089 | 18,554 | 19,262 | 18,912 | 16,473 | ||||||||||||||
| Other liabilities | 292,429 | 329,302 | 327,500 | 289,033 | 297,984 | ||||||||||||||
| Total Liabilities | 16,045,179 | 16,090,898 | 16,093,000 | 16,158,174 | 15,985,619 | ||||||||||||||
| STOCKHOLDERS' EQUITY | |||||||||||||||||||
| Preferred Stock, $1,000 par value, $1,000 liquidation value: | |||||||||||||||||||
| Authorized -- 600 cumulative shares | |||||||||||||||||||
| Issued and outstanding - 125 cumulative shares | 125 | 125 | 125 | 125 | 125 | ||||||||||||||
| Preferred Stock, Series A, no par value, $2,500 liquidation preference: | |||||||||||||||||||
| Authorized -- 10,000 non-cumulative perpetual shares | |||||||||||||||||||
| Issued and outstanding - 10,000 non-cumulative perpetual shares | 25,000 | 25,000 | 25,000 | 25,000 | 25,000 | ||||||||||||||
| Common Stock, $.125 stated value: | |||||||||||||||||||
| Authorized -- 100,000,000 shares | |||||||||||||||||||
| Issued and outstanding | 7,265 | 7,256 | 7,321 | 7,428 | 7,425 | ||||||||||||||
| Additional paid-in capital | 1,192,683 | 1,191,193 | 1,208,447 | 1,236,506 | 1,234,402 | ||||||||||||||
| Retained earnings | 1,229,125 | 1,200,930 | 1,181,939 | 1,154,624 | 1,132,962 | ||||||||||||||
| Accumulated other comprehensive loss | (151,825 | ) | (211,979 | ) | (198,029 | ) | (175,970 | ) | (307,270 | ) | |||||||||
| Total Stockholders' Equity | 2,302,373 | 2,212,525 | 2,224,803 | 2,247,713 | 2,092,644 | ||||||||||||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 18,347,552 | $ | 18,303,423 | $ | 18,317,803 | $ | 18,405,887 | $ | 18,078,263 | |||||||||
| CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||||||||
| (Dollars In Thousands, Except Per Share Amounts) | September 30, | June 30, | March 31, | December 31, | September 30, | ||||||||||||||
| 2024 | 2024 | 2024 | 2023 | 2023 | |||||||||||||||
| INTEREST INCOME | |||||||||||||||||||
| Loans receivable: | |||||||||||||||||||
| Taxable | $ | 206,680 | $ | 201,413 | $ | 198,023 | $ | 197,523 | $ | 191,705 | |||||||||
| Tax-exempt | 8,622 | 8,430 | 8,190 | 8,197 | 8,288 | ||||||||||||||
| Investment securities: | |||||||||||||||||||
| Taxable | 9,263 | 9,051 | 8,748 | 8,644 | 8,590 | ||||||||||||||
| Tax-exempt | 13,509 | 13,613 | 13,611 | 13,821 | 13,947 | ||||||||||||||
| Deposits with financial institutions | 2,154 | 2,995 | 6,493 | 8,034 | 5,884 | ||||||||||||||
| Federal Home Loan Bank stock | 855 | 879 | 835 | 771 | 719 | ||||||||||||||
| Total Interest Income | 241,083 | 236,381 | 235,900 | 236,990 | 229,133 | ||||||||||||||
| INTEREST EXPENSE | |||||||||||||||||||
| Deposits | 98,856 | 99,151 | 98,285 | 96,655 | 85,551 | ||||||||||||||
| Federal funds purchased | 329 | 126 | - | 1 | - | ||||||||||||||
| Securities sold under repurchase agreements | 700 | 645 | 1,032 | 827 | 797 | ||||||||||||||
| Federal Home Loan Bank advances | 8,544 | 6,398 | 6,773 | 6,431 | 6,896 | ||||||||||||||
| Subordinated debentures and other borrowings | 1,544 | 1,490 | 2,747 | 3,013 | 2,506 | ||||||||||||||
| Total Interest Expense | 109,973 | 107,810 | 108,837 | 106,927 | 95,750 | ||||||||||||||
| NET INTEREST INCOME | 131,110 | 128,571 | 127,063 | 130,063 | 133,383 | ||||||||||||||
| Provision for credit losses | 5,000 | 24,500 | 2,000 | 1,500 | 2,000 | ||||||||||||||
| NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES | 126,110 | 104,071 | 125,063 | 128,563 | 131,383 | ||||||||||||||
| NONINTEREST INCOME | |||||||||||||||||||
| Service charges on deposit accounts | 8,361 | 8,214 | 7,907 | 7,690 | 7,975 | ||||||||||||||
| Fiduciary and wealth management fees | 8,525 | 8,825 | 8,200 | 8,187 | 7,394 | ||||||||||||||
| Card payment fees | 5,121 | 4,739 | 4,500 | 4,437 | 4,716 | ||||||||||||||
| Net gains and fees on sales of loans | 6,764 | 5,141 | 3,254 | 4,111 | 5,517 | ||||||||||||||
| Derivative hedge fees | 736 | 489 | 263 | 1,049 | 516 | ||||||||||||||
| Other customer fees | 344 | 460 | 427 | 237 | 384 | ||||||||||||||
| Earnings on cash surrender value of life insurance | 2,755 | 1,929 | 1,592 | 3,202 | 1,761 | ||||||||||||||
| Net realized losses on sales of available for sale securities | (9,114 | ) | (49 | ) | (2 | ) | (2,317 | ) | (1,650 | ) | |||||||||
| Other income (loss) | 1,374 | 1,586 | 497 | (152 | ) | 1,229 | |||||||||||||
| Total Noninterest Income | 24,866 | 31,334 | 26,638 | 26,444 | 27,842 | ||||||||||||||
| NONINTEREST EXPENSES | |||||||||||||||||||
| Salaries and employee benefits | 55,223 | 52,214 | 58,293 | 60,967 | 55,566 | ||||||||||||||
| Net occupancy | 6,994 | 6,746 | 7,312 | 9,089 | 6,837 | ||||||||||||||
| Equipment | 6,949 | 6,599 | 6,226 | 6,108 | 5,698 | ||||||||||||||
| Marketing | 1,836 | 1,773 | 1,198 | 2,647 | 2,369 | ||||||||||||||
| Outside data processing fees | 7,150 | 7,072 | 6,889 | 5,875 | 6,573 | ||||||||||||||
| Printing and office supplies | 378 | 354 | 353 | 402 | 333 | ||||||||||||||
| Intangible asset amortization | 1,772 | 1,771 | 1,957 | 2,182 | 2,182 | ||||||||||||||
| FDIC assessments | 3,720 | 3,278 | 4,287 | 7,557 | 2,981 | ||||||||||||||
| Other real estate owned and foreclosure expenses | 942 | 373 | 534 | 1,743 | 677 | ||||||||||||||
| Professional and other outside services | 3,035 | 3,822 | 3,952 | 3,981 | 3,833 | ||||||||||||||
| Other expenses | 6,630 | 7,411 | 5,934 | 7,552 | 6,805 | ||||||||||||||
| Total Noninterest Expenses | 94,629 | 91,413 | 96,935 | 108,103 | 93,854 | ||||||||||||||
| INCOME BEFORE INCOME TAX | 56,347 | 43,992 | 54,766 | 46,904 | 65,371 | ||||||||||||||
| Income tax expense | 7,160 | 4,067 | 6,825 | 4,425 | 9,005 | ||||||||||||||
| NET INCOME | 49,187 | 39,925 | 47,941 | 42,479 | 56,366 | ||||||||||||||
| Preferred stock dividends | 468 | 469 | 469 | 469 | 468 | ||||||||||||||
| NET INCOME AVAILABLE TO COMMON STOCKHOLDERS | $ | 48,719 | $ | 39,456 | $ | 47,472 | $ | 42,010 | $ | 55,898 | |||||||||
| Per Share Data: | |||||||||||||||||||
| Basic Net Income Available to Common Stockholders | $ | 0.84 | $ | 0.68 | $ | 0.80 | $ | 0.71 | $ | 0.95 | |||||||||
| Diluted Net Income Available to Common Stockholders | $ | 0.84 | $ | 0.68 | $ | 0.80 | $ | 0.71 | $ | 0.94 | |||||||||
| Cash Dividends Paid to Common Stockholders | $ | 0.35 | $ | 0.35 | $ | 0.34 | $ | 0.34 | $ | 0.34 | |||||||||
| Average Diluted Common Shares Outstanding (in thousands) | 58,289 | 58,328 | 59,273 | 59,556 | 59,503 | ||||||||||||||
| FINANCIAL RATIOS: | |||||||||||||||||||
| Return on Average Assets | 1.07 | % | 0.87 | % | 1.04 | % | 0.92 | % | 1.24 | % | |||||||||
| Return on Average Stockholders' Equity | 8.66 | 7.16 | 8.47 | 7.89 | 10.38 | ||||||||||||||
| Return on Tangible Common Stockholders' Equity | 13.39 | 11.29 | 13.21 | 12.75 | 16.54 | ||||||||||||||
| Average Earning Assets to Average Assets | 92.54 | 92.81 | 92.91 | 93.62 | 93.36 | ||||||||||||||
| Allowance for Credit Losses - Loans as % of Total Loans | 1.48 | 1.50 | 1.64 | 1.64 | 1.67 | ||||||||||||||
| Net Charge-offs as % of Average Loans (Annualized) | 0.21 | 1.26 | 0.07 | 0.10 | 0.66 | ||||||||||||||
| Average Stockholders' Equity to Average Assets | 12.26 | 12.02 | 12.17 | 11.58 | 11.87 | ||||||||||||||
| Tax Equivalent Yield on Average Earning Assets | 5.82 | 5.69 | 5.65 | 5.64 | 5.55 | ||||||||||||||
| Interest Expense/Average Earning Assets | 2.59 | 2.53 | 2.55 | 2.48 | 2.26 | ||||||||||||||
| Net Interest Margin (FTE) on Average Earning Assets | 3.23 | 3.16 | 3.10 | 3.16 | 3.29 | ||||||||||||||
| Efficiency Ratio | 53.76 | 53.84 | 59.21 | 63.26 | 53.91 | ||||||||||||||
| Tangible Common Book Value Per Share | $ | 26.64 | $ | 25.10 | $ | 25.07 | $ | 25.06 | $ | 22.43 | |||||||||
| LOANS | |||||||||||||||||||
| (Dollars In Thousands) | September 30, | June 30, | March 31, | December 31, | September 30, | ||||||||||||||
| 2024 | 2024 | 2024 | 2023 | 2023 | |||||||||||||||
| Commercial and industrial loans | $ | 4,041,217 | $ | 3,949,817 | $ | 3,722,365 | $ | 3,670,948 | $ | 3,490,953 | |||||||||
| Agricultural land, production and other loans to farmers | 238,743 | 239,926 | 234,431 | 263,414 | 233,838 | ||||||||||||||
| Real estate loans: | |||||||||||||||||||
| Construction | 814,704 | 823,267 | 941,726 | 957,545 | 1,022,261 | ||||||||||||||
| Commercial real estate, non-owner occupied | 2,251,351 | 2,323,533 | 2,368,360 | 2,400,839 | 2,360,596 | ||||||||||||||
| Commercial real estate, owner occupied | 1,152,751 | 1,174,195 | 1,137,894 | 1,162,083 | 1,153,707 | ||||||||||||||
| Residential | 2,366,943 | 2,370,905 | 2,316,490 | 2,288,921 | 2,257,385 | ||||||||||||||
| Home equity | 641,188 | 631,104 | 618,258 | 617,571 | 609,352 | ||||||||||||||
| Individuals' loans for household and other personal expenditures | 158,480 | 162,089 | 161,459 | 168,388 | 176,523 | ||||||||||||||
| Public finance and other commercial loans | 981,431 | 964,814 | 964,599 | 956,318 | 966,807 | ||||||||||||||
| Loans | 12,646,808 | 12,639,650 | 12,465,582 | 12,486,027 | 12,271,422 | ||||||||||||||
| Allowance for credit losses - loans | (187,828 | ) | (189,537 | ) | (204,681 | ) | (204,934 | ) | (205,782 | ) | |||||||||
| NET LOANS | $ | 12,458,980 | $ | 12,450,113 | $ | 12,260,901 | $ | 12,281,093 | $ | 12,065,640 | |||||||||
| DEPOSITS | ||||||||||||||
| (Dollars In Thousands) | September 30, | June 30, | March 31, | December 31, | September 30, | |||||||||
| 2024 | 2024 | 2024 | 2023 | 2023 | ||||||||||
| Demand deposits | $ | 7,678,510 | $ | 7,757,679 | $ | 7,771,976 | $ | 7,965,862 | $ | 7,952,040 | ||||
| Savings deposits | 4,302,236 | 4,339,161 | 4,679,593 | 4,516,433 | 4,572,162 | |||||||||
| Certificates and other time deposits of $100,000 or more | 1,277,833 | 1,415,131 | 1,451,443 | 1,408,985 | 1,280,607 | |||||||||
| Other certificates and time deposits | 802,949 | 889,949 | 901,280 | 849,906 | 761,196 | |||||||||
| Brokered certificates of deposits1 | 303,572 | 167,150 | 80,292 | 80,267 | 80,571 | |||||||||
| TOTAL DEPOSITS2 | $ | 14,365,100 | $ | 14,569,070 | $ | 14,884,584 | $ | 14,821,453 | $ | 14,646,576 | ||||
1 - Total brokered deposits of $838.3 million, which includes brokered CD's of $303.6 million at September 30, 2024.
2 - Total deposits at September 30, 2024 excludes $287.7 million of deposits reclassified to Deposits and other liabilities held for sale related to the pending Illinois branch sale.
| CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST MARGIN ANALYSIS | |||||||||||||||||
| (Dollars in Thousands) | |||||||||||||||||
| For the Three Months Ended | |||||||||||||||||
| September 30, 2024 | September 30, 2023 | ||||||||||||||||
| Average Balance | Interest Income / Expense | Average Rate | Average Balance | Interest Income / Expense | Average Rate | ||||||||||||
| ASSETS | |||||||||||||||||
| Interest-bearing deposits | $ | 252,113 | $ | 2,154 | 3.42 | % | $ | 502,967 | $ | 5,884 | 4.68 | % | |||||
| Federal Home Loan Bank stock | 41,730 | 855 | 8.20 | 41,826 | 719 | 6.88 | |||||||||||
| Investment Securities: (1) | |||||||||||||||||
| Taxable | 1,789,526 | 9,263 | 2.07 | 1,817,219 | 8,590 | 1.89 | |||||||||||
| Tax-exempt (2) | 2,226,823 | 17,100 | 3.07 | 2,298,025 | 17,655 | 3.07 | |||||||||||
| Total Investment Securities | 4,016,349 | 26,363 | 2.63 | 4,115,244 | 26,245 | 2.55 | |||||||||||
| Loans held for sale | 31,991 | 483 | 6.04 | 24,227 | 386 | 6.37 | |||||||||||
| Loans: (3) | |||||||||||||||||
| Commercial | 8,699,733 | 164,922 | 7.58 | 8,456,527 | 153,993 | 7.28 | |||||||||||
| Real estate mortgage | 2,183,095 | 24,333 | 4.46 | 2,079,067 | 21,618 | 4.16 | |||||||||||
| Installment | 832,222 | 16,942 | 8.14 | 827,318 | 15,708 | 7.59 | |||||||||||
| Tax-exempt (2) | 933,125 | 10,914 | 4.68 | 900,493 | 10,491 | 4.66 | |||||||||||
| Total Loans | 12,680,166 | 217,594 | 6.86 | 12,287,632 | 202,196 | 6.58 | |||||||||||
| Total Earning Assets | 16,990,358 | 246,966 | 5.82 | % | 16,947,669 | 235,044 | 5.55 | % | |||||||||
| Total Non-Earning Assets | 1,370,222 | 1,204,570 | |||||||||||||||
| TOTAL ASSETS | $ | 18,360,580 | $ | 18,152,239 | |||||||||||||
| LIABILITIES | |||||||||||||||||
| Interest-Bearing Deposits: | |||||||||||||||||
| Interest-bearing deposits | $ | 5,455,298 | $ | 40,450 | 2.97 | % | $ | 5,425,829 | $ | 37,780 | 2.79 | % | |||||
| Money market deposits | 2,974,188 | 25,950 | 3.49 | 2,923,798 | 23,607 | 3.23 | |||||||||||
| Savings deposits | 1,425,047 | 4,208 | 1.18 | 1,641,338 | 3,844 | 0.94 | |||||||||||
| Certificates and other time deposits | 2,499,655 | 28,248 | 4.52 | 2,106,910 | 20,320 | 3.86 | |||||||||||
| Total Interest-Bearing Deposits | 12,354,188 | 98,856 | 3.20 | 12,097,875 | 85,551 | 2.83 | |||||||||||
| Borrowings | 1,071,440 | 11,117 | 4.15 | 1,032,180 | 10,199 | 3.95 | |||||||||||
| Total Interest-Bearing Liabilities | 13,425,628 | 109,973 | 3.28 | 13,130,055 | 95,750 | 2.92 | |||||||||||
| Noninterest-bearing deposits | 2,348,266 | 2,637,717 | |||||||||||||||
| Other liabilities | 335,139 | 230,235 | |||||||||||||||
| Total Liabilities | 16,109,033 | 15,998,007 | |||||||||||||||
| STOCKHOLDERS' EQUITY | 2,251,547 | 2,154,232 | |||||||||||||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 18,360,580 | 109,973 | $ | 18,152,239 | 95,750 | |||||||||||
| Net Interest Income (FTE) | $ | 136,993 | $ | 139,294 | |||||||||||||
| Net Interest Spread (FTE) (4) | 2.54 | % | 2.63 | % | |||||||||||||
| Net Interest Margin (FTE): | |||||||||||||||||
| Interest Income (FTE) / Average Earning Assets | 5.82 | % | 5.55 | % | |||||||||||||
| Interest Expense / Average Earning Assets | 2.59 | % | 2.26 | % | |||||||||||||
| Net Interest Margin (FTE) (5) | 3.23 | % | 3.29 | % | |||||||||||||
| (1) Average balance of securities is computed based on the average of the historical amortized cost balances without the effects of the fair value adjustments. Annualized amounts are computed using a 30/360 day basis. | |||||||||||||||||
| (2) Tax-exempt securities and loans are presented on a fully taxable equivalent basis, using a marginal tax rate of 21 percent for 2024 and 2023. These totals equal $5,883 and $5,911 for the three months ended September 30, 2024 and 2023, respectively. | |||||||||||||||||
| (3) Non accruing loans have been included in the average balances. | |||||||||||||||||
| (4) Net Interest Spread (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average interest-bearing liabilities. | |||||||||||||||||
| (5) Net Interest Margin (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average earning assets. | |||||||||||||||||
| CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST MARGIN ANALYSIS | |||||||||||||||||
| (Dollars in Thousands) | |||||||||||||||||
| For the Nine Months Ended | |||||||||||||||||
| September 30, 2024 | September 30, 2023 | ||||||||||||||||
| Average Balance | Interest Income / Expense | Average Rate | Average Balance | Interest Income / Expense | Average Rate | ||||||||||||
| ASSETS | |||||||||||||||||
| Interest-bearing deposits | $ | 383,007 | $ | 11,642 | 4.05 | % | $ | 340,887 | $ | 9,685 | 3.79 | % | |||||
| Federal Home Loan Bank stock | 41,748 | 2,569 | 8.20 | 41,160 | 2,281 | 7.39 | |||||||||||
| Investment Securities: (1) | |||||||||||||||||
| Taxable | 1,787,119 | 27,062 | 2.02 | 1,872,267 | 26,563 | 1.89 | |||||||||||
| Tax-exempt (2) | 2,237,759 | 51,561 | 3.07 | 2,394,864 | 56,071 | 3.12 | |||||||||||
| Total Investment Securities | 4,024,878 | 78,623 | 2.60 | 4,267,131 | 82,634 | 2.58 | |||||||||||
| Loans held for sale | 27,735 | 1,242 | 5.97 | 22,398 | 1,046 | 6.23 | |||||||||||
| Loans: (3) | |||||||||||||||||
| Commercial | 8,659,088 | 484,979 | 7.47 | 8,515,148 | 444,422 | 6.96 | |||||||||||
| Real estate mortgage | 2,159,738 | 70,489 | 4.35 | 2,008,852 | 60,354 | 4.01 | |||||||||||
| Installment | 825,060 | 49,406 | 7.98 | 833,133 | 44,492 | 7.12 | |||||||||||
| Tax-exempt (2) | 921,286 | 31,952 | 4.62 | 885,256 | 30,072 | 4.53 | |||||||||||
| Total Loans | 12,592,907 | 638,068 | 6.76 | 12,264,787 | 580,386 | 6.31 | |||||||||||
| Total Earning Assets | 17,042,540 | 730,902 | 5.72 | % | 16,913,965 | 674,986 | 5.32 | % | |||||||||
| Total Non-Earning Assets | 1,331,830 | 1,201,539 | |||||||||||||||
| TOTAL ASSETS | $ | 18,374,370 | $ | 18,115,504 | |||||||||||||
| LIABILITIES | |||||||||||||||||
| Interest-Bearing deposits: | |||||||||||||||||
| Interest-bearing deposits | $ | 5,487,106 | $ | 120,935 | 2.94 | % | $ | 5,412,482 | $ | 97,016 | 2.39 | % | |||||
| Money market deposits | 3,018,526 | 80,563 | 3.56 | 2,812,891 | 55,868 | 2.65 | |||||||||||
| Savings deposits | 1,497,620 | 11,485 | 1.02 | 1,730,110 | 10,693 | 0.82 | |||||||||||
| Certificates and other time deposits | 2,447,684 | 83,309 | 4.54 | 1,821,408 | 45,860 | 3.36 | |||||||||||
| Total Interest-Bearing Deposits | 12,450,936 | 296,292 | 3.17 | 11,776,891 | 209,437 | 2.37 | |||||||||||
| Borrowings | 990,022 | 30,328 | 4.08 | 1,144,368 | 32,122 | 3.74 | |||||||||||
| Total Interest-Bearing Liabilities | 13,440,958 | 326,620 | 3.24 | 12,921,259 | 241,559 | 2.49 | |||||||||||
| Noninterest-bearing deposits | 2,375,120 | 2,850,557 | |||||||||||||||
| Other liabilities | 325,873 | 217,683 | |||||||||||||||
| Total Liabilities | 16,141,951 | 15,989,499 | |||||||||||||||
| STOCKHOLDERS' EQUITY | 2,232,419 | 2,126,005 | |||||||||||||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 18,374,370 | 326,620 | $ | 18,115,504 | 241,559 | |||||||||||
| Net Interest Income (FTE) | $ | 404,282 | $ | 433,427 | |||||||||||||
| Net Interest Spread (FTE) (4) | 2.48 | % | 2.83 | % | |||||||||||||
| Net Interest Margin (FTE): | |||||||||||||||||
| Interest Income (FTE) / Average Earning Assets | 5.72 | % | 5.32 | % | |||||||||||||
| Interest Expense / Average Earning Assets | 2.56 | % | 1.90 | % | |||||||||||||
| Net Interest Margin (FTE) (5) | 3.16 | % | 3.42 | % | |||||||||||||
| (1) Average balance of securities is computed based on the average of the historical amortized cost balances without the effects of the fair value adjustments. Annualized amounts are computed using a 30/360 day basis. | |||||||||||||||||
| (2) Tax-exempt securities and loans are presented on a fully taxable equivalent basis, using a marginal tax rate of 21 percent for 2024 and 2023. These totals equal $17,538 and $18,090 for the nine months ended September 30, 2024 and 2023, respectively. | |||||||||||||||||
| (3) Non accruing loans have been included in the average balances. | |||||||||||||||||
| (4) Net Interest Spread (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average interest-bearing liabilities. | |||||||||||||||||
| (5) Net Interest Margin (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average earning assets. | |||||||||||||||||
| ADJUSTED NET INCOME AND DILUTED EARNINGS PER COMMON SHARE - NON-GAAP | |||||||||||||||||||||||||||
| (Dollars In Thousands, Except Per Share Amounts) | Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| September 30, | June 30, | March 31, | December 31, | September 30, | September 30, | September 30, | |||||||||||||||||||||
| 2024 | 2024 | 2024 | 2023 | 2023 | 2024 | 2023 | |||||||||||||||||||||
| Net Income Available to Common Stockholders - GAAP | $ | 48,719 | $ | 39,456 | $ | 47,472 | $ | 42,010 | $ | 55,898 | $ | 135,647 | $ | 179,901 | |||||||||||||
| Adjustments: | |||||||||||||||||||||||||||
| PPP loan income | - | - | - | (7 | ) | (8 | ) | - | (42 | ) | |||||||||||||||||
| Net realized losses on sales of available for sale securities | 9,114 | 49 | 2 | 2,317 | 1,650 | 9,165 | 4,613 | ||||||||||||||||||||
| Non-core expenses1,2 | - | - | 3,481 | 12,682 | - | 3,481 | - | ||||||||||||||||||||
| Tax on adjustments | (2,220 | ) | (12 | ) | (848 | ) | (3,652 | ) | (403 | ) | (3,081 | ) | (1,121 | ) | |||||||||||||
| Adjusted Net Income Available to Common Stockholders - Non-GAAP | $ | 55,613 | $ | 39,493 | $ | 50,107 | $ | 53,350 | $ | 57,137 | $ | 145,212 | $ | 183,351 | |||||||||||||
| Average Diluted Common Shares Outstanding (in thousands) | 58,289 | 58,328 | 59,273 | 59,556 | 59,503 | 58,629 | 59,465 | ||||||||||||||||||||
| Diluted Earnings Per Common Share - GAAP | $ | 0.84 | $ | 0.68 | $ | 0.80 | $ | 0.71 | $ | 0.94 | $ | 2.31 | $ | 3.03 | |||||||||||||
| Adjustments: | |||||||||||||||||||||||||||
| PPP loan income | - | - | - | - | - | - | - | ||||||||||||||||||||
| Net realized losses on sales of available for sale securities | 0.15 | - | - | 0.04 | 0.03 | 0.16 | 0.07 | ||||||||||||||||||||
| Non-core expenses1,2 | - | - | 0.06 | 0.21 | - | 0.06 | - | ||||||||||||||||||||
| Tax on adjustments | (0.04 | ) | - | (0.01 | ) | (0.06 | ) | (0.01 | ) | (0.05 | ) | (0.02 | ) | ||||||||||||||
| Adjusted Diluted Earnings Per Common Share - Non-GAAP | $ | 0.95 | $ | 0.68 | $ | 0.85 | $ | 0.90 | $ | 0.96 | $ | 2.48 | $ | 3.08 | |||||||||||||
1 - Non-core expenses in 4Q23 included $6.3 million from early retirement and severance costs, $4.3 million from the FDIC special assessment, and $2.1 million from a lease termination.
2 - Non-core expenses in 1Q24 included $2.4 million from duplicative online banking conversion costs and $1.1 million from the FDIC special assessment.
| NET INTEREST MARGIN ("NIM"), ADJUSTED | |||||||||||||||||||||||||||
| (Dollars in Thousands, Except Per Share Amounts) | |||||||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||
| September 30, | June 30, | March 31, | December 31, | September 30, | September 30, | September 30, | |||||||||||||||||||||
| 2024 | 2024 | 2024 | 2023 | 2023 | 2024 | 2023 | |||||||||||||||||||||
| Net Interest Income (GAAP) | $ | 131,110 | $ | 128,571 | $ | 127,063 | $ | 130,063 | $ | 133,383 | $ | 386,744 | $ | 415,337 | |||||||||||||
| Fully Taxable Equivalent ("FTE") Adjustment | 5,883 | 5,859 | 5,795 | 5,853 | 5,911 | 17,538 | 18,090 | ||||||||||||||||||||
| Net Interest Income (FTE) (non-GAAP) | $ | 136,993 | $ | 134,430 | $ | 132,858 | $ | 135,916 | $ | 139,294 | $ | 404,282 | $ | 433,427 | |||||||||||||
| Average Earning Assets (GAAP) | $ | 16,990,358 | $ | 17,013,984 | $ | 17,123,851 | $ | 17,222,714 | $ | 16,947,669 | $ | 17,042,540 | $ | 16,913,965 | |||||||||||||
| Net Interest Margin (GAAP) | 3.09 | % | 3.02 | % | 2.97 | % | 3.02 | % | 3.15 | % | 3.03 | % | 3.27 | % | |||||||||||||
| Net Interest Margin (FTE) (non-GAAP) | 3.23 | % | 3.16 | % | 3.10 | % | 3.16 | % | 3.29 | % | 3.16 | % | 3.42 | % | |||||||||||||
| RETURN ON TANGIBLE COMMON EQUITY - NON-GAAP | |||||||||||||||||||||||||||
| (Dollars In Thousands) | Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| September 30, | June 30, | March 31, | December 31, | September 30, | September 30, | September 30, | |||||||||||||||||||||
| 2024 | 2024 | 2024 | 2023 | 2023 | 2024 | 2023 | |||||||||||||||||||||
| Total Average Stockholders' Equity (GAAP) | $ | 2,251,547 | $ | 2,203,361 | $ | 2,242,139 | $ | 2,130,993 | $ | 2,154,232 | $ | 2,232,419 | $ | 2,126,005 | |||||||||||||
| Less: Average Preferred Stock | (25,125 | ) | (25,125 | ) | (25,125 | ) | (25,125 | ) | (25,125 | ) | (25,125 | ) | (25,125 | ) | |||||||||||||
| Less: Average Intangible Assets, Net of Tax | (729,581 | ) | (730,980 | ) | (732,432 | ) | (734,007 | ) | (735,787 | ) | (730,993 | ) | (737,476 | ) | |||||||||||||
| Average Tangible Common Equity, Net of Tax (Non-GAAP) | $ | 1,496,841 | $ | 1,447,256 | $ | 1,484,582 | $ | 1,371,861 | $ | 1,393,320 | $ | 1,476,301 | $ | 1,363,404 | |||||||||||||
| Net Income Available to Common Stockholders (GAAP) | $ | 48,719 | $ | 39,456 | $ | 47,472 | $ | 42,010 | $ | 55,898 | $ | 135,647 | $ | 179,901 | |||||||||||||
| Plus: Intangible Asset Amortization, Net of Tax | 1,399 | 1,399 | 1,546 | 1,724 | 1,724 | 4,345 | 5,182 | ||||||||||||||||||||
| Tangible Net Income (Non-GAAP) | $ | 50,118 | $ | 40,855 | $ | 49,018 | $ | 43,734 | $ | 57,622 | $ | 139,992 | $ | 185,083 | |||||||||||||
| Return on Tangible Common Equity (Non-GAAP) | 13.39 | % | 11.29 | % | 13.21 | % | 12.75 | % | 16.54 | % | 12.64 | % | 18.10 | % | |||||||||||||
For more information, contact:
Nicole M. Weaver, Vice President and Director of Corporate Administration
765-521-7619
http://www.firstmerchants.com
SOURCE: First Merchants Corporation, Muncie, Indiana
