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NEWS
News
FMB Quarterly Earnings Graphic with Coins and Arrows Showing Money Growth

Thursday, July 25, 2024

First Merchants Corporation (NASDAQ - FRME)

Second Quarter 2024 Highlights:

  • Net income available to common stockholders was $39.5 million and diluted earnings per common share totaled $.68 in the second quarter of 2024, compared to $60.4 million and $1.02 in the second quarter of 2023, and $47.5 million and $.80 in the first quarter of 2024.
  • Strong capital position with Common Equity Tier 1 Capital Ratio of 11.02 percent.
  • Net interest margin totaled 3.16 percent compared to 3.10 percent on a linked quarter basis.
  • Total loans grew $191.2 million, or 6.1 percent annualized on a linked quarter basis, and $374.4 million, or 3.0 percent during the last twelve months.
  • Total deposits declined $315.5 million, or 8.5 percent annualized on a linked quarter basis.
  • The efficiency ratio totaled 53.84 percent for the quarter.

     

    Mark Hardwick, Chief Executive Officer, stated, "We are pleased that net interest margin improved by 6 basis points over the first quarter of 2024 and that net interest income increased by $1.5 million over the same period.  Non-interest income and non-interest expense also compared favorably helping the company produce an efficiency ratio better than our stated key performance indicator of less than 55 percent."  Hardwick added, "The elevated provision expense driven by higher than normal net charge-off’s was the singular item that weakened our performance in the quarter. "

    Second Quarter Financial Results:

    First Merchants Corporation (the “Corporation) has reported second quarter 2024 net income available to common stockholders of $39.5 million compared to $60.4 million during the same period in 2023.  Diluted earnings per common share for the period totaled $.68 per share compared to the second quarter of 2023 result of $1.02 per share.

    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 $374.4 million, or 3.0 percent.  On a linked quarter basis, loans grew $191.2 million, or 6.1 percent with growth primarily in Commercial & Industrial loans.

    Investments, totaling $3.8 billion, decreased $138.4 million, or 3.6 percent, during the last twelve months and decreased $30.5 million, or 3.2 percent annualized on a linked quarter basis.

    Total deposits equaled $14.6 billion as of quarter-end and decreased by $12.1 million over the past twelve months. Total deposits declined $315.5 million, or 8.5 percent annualized on a linked quarter basis with noninterest-bearing deposits remaining stable.  The loan to deposit ratio for the current quarter ended at 87.0 percent.

    The Corporation’s Allowance for Credit Losses – Loans (ACL) totaled $189.5 million as of quarter-end, or 1.50 percent of total loans.  Loan charge-offs, net of recoveries, for the quarter totaled $39.6 million and provision expense of $24.5 million was recorded during the quarter.  Reserves for unfunded commitments totaling $19.5 million remain unchanged from prior quarter. Non-performing assets to total assets were 0.36 percent for the second quarter of 2024, a decrease of one basis point compared to 0.37 percent in the prior quarter.

    Net interest income, totaling $128.6 million for the quarter, increased $1.5 million, or 1.2 percent, compared to prior quarter but decreased $9.3 million, or 6.7 percent compared to the second quarter of 2023.  Stated net-interest margin on a tax equivalent basis, totaling 3.16 percent, increased by six basis points compared to the first quarter of 2024 but decreased 23 basis points compared to the second quarter of 2023.  During the quarter, higher yields on earnings assets and lower yields on interest bearing liabilities both contributed to the increase in net-interest margin over last quarter.

    Noninterest income, totaling $31.3 million for the quarter, increased $4.7 million, or 17.6 percent, compared to the first quarter of 2024 and increased $5.0 million from the second quarter of 2023. The increase over first quarter of 2024 was driven primarily by higher gains on the sales of loans, private wealth fees, and an increase in CRA investment valuations recorded through Other Income on the Income Statement.

    Noninterest expense totaled $91.4 million for the quarter, a decline of $5.5 million from the first quarter of 2024.  The decrease was from lower salaries and employee benefits and lower FDIC assessments, offset by the inclusion of $0.7 million of gains on the sale of properties in the prior quarter which were recorded in Other Expenses.

    The Corporation’s total risk-based capital ratio equaled 12.95 percent, common equity tier 1 capital ratio equaled 11.02 percent, and the tangible common equity ratio totaled 8.27 percent.  These ratios continue to reflect the Corporation’s strong liquidity and capital positions.

    CONFERENCE CALL 

    First Merchants Corporation will conduct a second quarter earnings conference call and web cast at 11:30 a.m. (ET) on Thursday, July 25, 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/BId0844162db694c8f80a4e6caa546f714)

    In order to view the webcast and presentation slides, please go to (First Merchants Corporation Second Quarter 2024 Earnings Call) during the time of the call. A replay of the webcast will be available until July 25, 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 of 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) June 30,
      2024   2023
    ASSETS      
    Cash and due from banks $                  105,372   $                  108,975
    Interest-bearing deposits                     168,528                       219,480
    Investment securities, net of allowance for credit losses of $245,000 and $245,000                  3,753,088                    3,891,491
    Loans held for sale                      32,292                        27,297
    Loans                12,639,650                  12,270,233
    Less: Allowance for credit losses - loans                   (189,537)                     (221,147)
    Net loans                12,450,113                  12,049,086
    Premises and equipment                     133,245                       114,402
    Federal Home Loan Bank stock                      41,738                        41,842
    Interest receivable                      97,546                        89,784
    Goodwill and other intangibles                     735,373                       743,465
    Cash surrender value of life insurance                     306,379                       307,020
    Other real estate owned                        4,824                          7,685
    Tax asset, deferred and receivable                     107,080                       113,724
    Other assets                     367,845                       318,005
    TOTAL ASSETS $              18,303,423   $              18,032,256
    LIABILITIES      
    Deposits:      
    Noninterest-bearing $               2,303,313   $               2,636,017
    Interest-bearing                12,265,757                  11,945,138
    Total Deposits                14,569,070                  14,581,155
    Borrowings:      
    Federal funds purchased                     147,229                               —
    Securities sold under repurchase agreements                     100,451                       152,472
    Federal Home Loan Bank advances                     832,703                       723,480
    Subordinated debentures and other borrowings                      93,589                       151,325
    Total Borrowings                  1,173,972                    1,027,277
    Interest payable                      18,554                        13,595
    Other liabilities                     329,302                       264,664
    Total Liabilities                16,090,898                  15,886,691
    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 - 58,045,653 and 59,297,148 shares                        7,256                          7,412
    Additional paid-in capital                  1,191,193                    1,233,593
    Retained earnings                  1,200,930                    1,097,399
    Accumulated other comprehensive loss                   (211,979)                     (217,964)
    Total Stockholders' Equity                  2,212,525                    2,145,565
    TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $              18,303,423   $              18,032,256

     

     

     

     

    CONSOLIDATED STATEMENTS OF INCOME Three Months Ended   Six Months Ended
    (Dollars In Thousands, Except Per Share Amounts) June 30,   June 30,
      2024   2023   2024   2023
    INTEREST INCOME              
    Loans receivable:              
    Taxable $              201,413   $              186,256   $              399,436   $              358,609
    Tax-exempt                    8,430                      7,760                    16,620                    15,469
    Investment securities:              
    Taxable                    9,051                      8,886                    17,799                    17,973
    Tax-exempt                  13,613                    14,279                    27,224                    30,349
    Deposits with financial institutions                    2,995                      3,164                      9,488                      3,801
    Federal Home Loan Bank stock                      879                      1,020                      1,714                      1,562
    Total Interest Income                236,381                  221,365                  472,281                  427,763
    INTEREST EXPENSE              
    Deposits                  99,151                    73,201                  197,436                  123,886
    Federal funds purchased                      126                        123                        126                      1,420
    Securities sold under repurchase agreements                      645                        979                      1,677                      1,827
    Federal Home Loan Bank advances                    6,398                      6,815                    13,171                    13,879
    Subordinated debentures and other borrowings                    1,490                      2,412                      4,237                      4,797
    Total Interest Expense                107,810                    83,530                  216,647                  145,809
    NET INTEREST INCOME                128,571                  137,835                  255,634                  281,954
    Provision for credit losses                  24,500                          —                    26,500                          —
    NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES                104,071                  137,835                  229,134                  281,954
    NONINTEREST INCOME              
    Service charges on deposit accounts                    8,214                      7,813                    16,121                    15,172
    Fiduciary and wealth management fees                    8,825                      7,397                    17,025                    15,259
    Card payment fees                    4,739                      4,537                      9,239                      9,709
    Net gains and fees on sales of loans                    5,141                      3,632                      8,395                      6,031
    Derivative hedge fees                      489                        672                        752                      1,820
    Other customer fees                      460                        742                        887                      1,259
    Earnings on cash surrender value of life insurance                    1,929                      2,096                      3,521                      3,384
    Net realized losses on sales of available for sale securities                       (49)                    (1,392)                         (51)                    (2,963)
    Other income                    1,586                        822                      2,083                      1,645
    Total Noninterest Income                  31,334                    26,319                    57,972                    51,316
    NONINTEREST EXPENSES              
    Salaries and employee benefits                  52,214                    54,753                  110,507                  112,212
    Net occupancy                    6,746                      6,674                    14,058                    13,933
    Equipment                    6,599                      6,181                    12,825                    12,307
    Marketing                    1,773                      1,102                      2,971                      2,411
    Outside data processing fees                    7,072                      6,604                    13,961                    12,717
    Printing and office supplies                      354                        434                        707                        817
    Intangible asset amortization                    1,771                      2,182                      3,728                      4,379
    FDIC assessments                    3,278                      2,740                      7,565                      4,136
    Other real estate owned and foreclosure expenses                      373                        916                        907                        898
    Professional and other outside services                    3,822                      4,660                      7,774                      8,358
    Other expenses                    7,411                      6,347                    13,345                    14,145
    Total Noninterest Expenses                  91,413                    92,593                  188,348                  186,313
    INCOME BEFORE INCOME TAX                  43,992                    71,561                    98,758                  146,957
    Income tax expense                    4,067                    10,699                    10,892                    22,016
    NET INCOME                  39,925                    60,862                    87,866                  124,941
    Preferred stock dividends                      469                        469                        938                        938
    NET INCOME AVAILABLE TO COMMON STOCKHOLDERS $               39,456   $               60,393   $               86,928   $              124,003
    Per Share Data:              
    Basic Net Income Available to Common Stockholders $                   0.68   $                   1.02   $                   1.48   $                   2.09
    Diluted Net Income Available to Common Stockholders $                   0.68   $                   1.02   $                   1.48   $                   2.09
    Cash Dividends Paid to Common Stockholders $                   0.35   $                   0.34   $                   0.69   $                   0.66
    Average Diluted Common Shares Outstanding (in thousands)                  58,328                    59,448                    58,800                    59,446

     

    FINANCIAL HIGHLIGHTS              
    (Dollars in thousands) Three Months Ended   Six Months Ended
      June 30,   June 30,
      2024   2023   2024   2023
    NET CHARGE-OFFS $             39,644      $              1,905      $             41,897      $              2,130   
                   
    AVERAGE BALANCES:              
    Total Assets $       18,332,159      $       18,170,649      $       18,381,340      $       18,096,832   
    Total Loans         12,620,530              12,369,673              12,548,798              12,253,176   
    Total Earning Assets         17,013,984              16,968,465              17,068,917              16,896,834   
    Total Deposits         14,895,867              14,719,913              14,888,536              14,572,480   
    Total Stockholders' Equity           2,203,361                2,139,877                2,222,750                2,111,658   
                   
    FINANCIAL RATIOS:              
    Return on Average Assets 0.87 %   1.34 %   0.96 %   1.38 %
    Return on Average Stockholders' Equity                   7.16                      11.29                        7.82                      11.74   
    Return on Tangible Common Stockholders' Equity                 11.29                      18.04                      12.26                      18.91   
    Average Earning Assets to Average Assets                 92.81                      93.38                      92.86                      93.37   
    Allowance for Credit Losses - Loans as % of Total Loans                   1.50                        1.80                        1.50                        1.80   
    Net Charge-offs as % of Average Loans (Annualized)                   1.26                        0.06                        0.67                        0.03   
    Average Stockholders' Equity to Average Assets                 12.02                      11.78                      12.09                      11.67   
    Tax Equivalent Yield on Average Earning Assets                   5.69                        5.36                        5.67                        5.21   
    Interest Expense/Average Earning Assets                   2.53                        1.97                        2.54                        1.73   
    Net Interest Margin (FTE) on Average Earning Assets                   3.16                        3.39                        3.13                        3.48   
    Efficiency Ratio                 53.84                      52.21                      56.47                      51.96   
    Tangible Common Book Value Per Share $              25.10      $              23.34      $              25.10      $              23.34   

     

    NONPERFORMING ASSETS                  
    (Dollars In Thousands) June 30,   March 31,   December 31,   September 30,   June 30,
      2024   2024   2023   2023   2023
    Nonaccrual Loans $        61,906      $        62,478      $        53,580      $        53,102      $        69,240   
    Other Real Estate Owned and Repossessions            4,824                 4,886                 4,831                 6,480                 7,685   
    Nonperforming Assets (NPA)           66,730                67,364                58,411                59,582                76,925   
    90+ Days Delinquent            1,686                 2,838                    172                      89                    428   
    NPAs & 90 Day Delinquent $        68,416      $        70,202      $        58,583      $        59,671      $        77,353   
                       
    Allowance for Credit Losses - Loans $      189,537      $      204,681      $      204,934      $      205,782      $      221,147   
    Quarterly Net Charge-offs           39,644                 2,253                 3,148                20,365                 1,905   
    NPAs / Actual Assets % 0.36 %   0.37 %   0.32 %   0.33 %   0.43 %
    NPAs & 90 Day / Actual Assets % 0.37 %   0.38 %   0.32 %   0.33 %   0.43 %
    NPAs / Actual Loans and OREO % 0.53 %   0.54 %   0.47 %   0.48 %   0.63 %
    Allowance for Credit Losses - Loans / Actual Loans (%) 1.50 %   1.64 %   1.64 %   1.67 %   1.80 %
    Net Charge-offs (Recoveries) as % of Average Loans (Annualized) 1.26 %   0.07 %   0.10 %   0.66 %   0.06 %

     

    CONSOLIDATED BALANCE SHEETS                  
    (Dollars In Thousands) June 30,   March 31,   December 31,   September 30,   June 30,
      2024   2024   2023   2023   2023
    ASSETS                  
    Cash and due from banks $         105,372   $         100,514   $         112,649   $         125,173   $         108,975
    Interest-bearing deposits            168,528              410,497              436,080              348,639              219,480
    Investment securities, net of allowance for credit losses         3,753,088           3,783,574           3,811,364           3,713,724           3,891,491
    Loans held for sale             32,292               15,118               18,934               30,972               27,297
    Loans       12,639,650         12,465,582         12,486,027         12,271,422         12,270,233
    Less: Allowance for credit losses - loans          (189,537)            (204,681)            (204,934)            (205,782)            (221,147)
    Net loans       12,450,113         12,260,901         12,281,093         12,065,640         12,049,086
    Premises and equipment            133,245              132,706              133,896              132,441              114,402
    Federal Home Loan Bank stock             41,738               41,758               41,769               41,797               41,842
    Interest receivable             97,546               92,550               97,664               90,011               89,784
    Goodwill and other intangibles            735,373              737,144              739,101              741,283              743,465
    Cash surrender value of life insurance            306,379              306,028              306,301              306,106              307,020
    Other real estate owned               4,824                 4,886                 4,831                 6,480                 7,685
    Tax asset, deferred and receivable            107,080              101,121               99,883              135,521              113,724
    Other assets            367,845              331,006              322,322              340,476              318,005
    TOTAL ASSETS $     18,303,423   $     18,317,803   $     18,405,887   $     18,078,263   $     18,032,256
    LIABILITIES                  
    Deposits:                  
    Noninterest-bearing $      2,303,313   $      2,338,364   $      2,500,062   $      2,554,984   $      2,636,017
    Interest-bearing       12,265,757         12,546,220         12,321,391         12,091,592         11,945,138
    Total Deposits       14,569,070         14,884,584         14,821,453         14,646,576         14,581,155
    Borrowings:                  
    Federal funds purchased            147,229                      —                      —                      —                      —
    Securities sold under repurchase agreements            100,451              130,264              157,280              152,537              152,472
    Federal Home Loan Bank advances            832,703              612,778              712,852              713,384              723,480
    Subordinated debentures and other borrowings             93,589              118,612              158,644              158,665              151,325
    Total Borrowings         1,173,972              861,654           1,028,776           1,024,586           1,027,277
    Interest payable             18,554               19,262               18,912               16,473               13,595
    Other liabilities            329,302              327,500              289,033              297,984              264,664
    Total Liabilities       16,090,898         16,093,000         16,158,174         15,985,619         15,886,691
    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               7,256                 7,321                 7,428                 7,425                 7,412
    Additional paid-in capital         1,191,193           1,208,447           1,236,506           1,234,402           1,233,593
    Retained earnings         1,200,930           1,181,939           1,154,624           1,132,962           1,097,399
    Accumulated other comprehensive loss          (211,979)            (198,029)            (175,970)            (307,270)            (217,964)
    Total Stockholders' Equity         2,212,525           2,224,803           2,247,713           2,092,644           2,145,565
    TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $     18,303,423   $     18,317,803   $     18,405,887   $     18,078,263   $     18,032,256
                       

     

     

     

     

     

    CONSOLIDATED STATEMENTS OF INCOME                  
    (Dollars In Thousands, Except Per Share Amounts) June 30,   March 31,   December 31,   September 30,   June 30,
      2024   2024   2023   2023   2023
    INTEREST INCOME                  
    Loans receivable:                  
    Taxable $      201,413      $      198,023      $      197,523      $      191,705      $      186,256   
    Tax-exempt            8,430                 8,190                 8,197                 8,288                 7,760   
    Investment securities:                  
    Taxable            9,051                 8,748                 8,644                 8,590                 8,886   
    Tax-exempt           13,613                13,611                13,821                13,947                14,279   
    Deposits with financial institutions            2,995                 6,493                 8,034                 5,884                 3,164   
    Federal Home Loan Bank stock               879                    835                    771                    719                 1,020   
    Total Interest Income         236,381              235,900              236,990              229,133              221,365   
    INTEREST EXPENSE                  
    Deposits           99,151                98,285                96,655                85,551                73,201   
    Federal funds purchased               126                      —                       1                      —                    123   
    Securities sold under repurchase agreements               645                 1,032                    827                    797                    979   
    Federal Home Loan Bank advances            6,398                 6,773                 6,431                 6,896                 6,815   
    Subordinated debentures and other borrowings            1,490                 2,747                 3,013                 2,506                 2,412   
    Total Interest Expense         107,810              108,837              106,927                95,750                83,530   
    NET INTEREST INCOME         128,571              127,063              130,063              133,383              137,835   
    Provision for credit losses           24,500                 2,000                 1,500                 2,000                      —   
    NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES         104,071              125,063              128,563              131,383              137,835   
    NONINTEREST INCOME                  
    Service charges on deposit accounts            8,214                 7,907                 7,690                 7,975                 7,813   
    Fiduciary and wealth management fees            8,825                 8,200                 8,187                 7,394                 7,397   
    Card payment fees            4,739                 4,500                 4,437                 4,716                 4,537   
    Net gains and fees on sales of loans            5,141                 3,254                 4,111                 5,517                 3,632   
    Derivative hedge fees               489                    263                 1,049                    516                    672   
    Other customer fees               460                    427                    237                    384                    742   
    Earnings on cash surrender value of life insurance            1,929                 1,592                 3,202                 1,761                 2,096   
    Net realized losses on sales of available for sale securities               (49)                     (2)               (2,317)               (1,650)               (1,392)  
    Other income (loss)            1,586                    497                  (152)                1,229                    822   
    Total Noninterest Income           31,334                26,638                26,444                27,842                26,319   
    NONINTEREST EXPENSES                  
    Salaries and employee benefits           52,214                58,293                60,967                55,566                54,753   
    Net occupancy            6,746                 7,312                 9,089                 6,837                 6,674   
    Equipment            6,599                 6,226                 6,108                 5,698                 6,181   
    Marketing            1,773                 1,198                 2,647                 2,369                 1,102   
    Outside data processing fees            7,072                 6,889                 5,875                 6,573                 6,604   
    Printing and office supplies               354                    353                    402                    333                    434   
    Intangible asset amortization            1,771                 1,957                 2,182                 2,182                 2,182   
    FDIC assessments            3,278                 4,287                 7,557                 2,981                 2,740   
    Other real estate owned and foreclosure expenses               373                    534                 1,743                    677                    916   
    Professional and other outside services            3,822                 3,952                 3,981                 3,833                 4,660   
    Other expenses            7,411                 5,934                 7,552                 6,805                 6,347   
    Total Noninterest Expenses           91,413                96,935              108,103                93,854                92,593   
    INCOME BEFORE INCOME TAX           43,992                54,766                46,904                65,371                71,561   
    Income tax expense            4,067                 6,825                 4,425                 9,005                10,699   
    NET INCOME           39,925                47,941                42,479                56,366                60,862   
    Preferred stock dividends               469                    469                    469                    468                    469   
    NET INCOME AVAILABLE TO COMMON STOCKHOLDERS $        39,456      $        47,472      $        42,010      $        55,898      $        60,393   
    Per Share Data:                  
    Basic Net Income Available to Common Stockholders $           0.68      $           0.80      $           0.71      $           0.95      $           1.02   
    Diluted Net Income Available to Common Stockholders $           0.68      $           0.80      $           0.71      $           0.94      $           1.02   
    Cash Dividends Paid to Common Stockholders $           0.35      $           0.34      $           0.34      $           0.34      $           0.34   
    Average Diluted Common Shares Outstanding (in thousands)           58,328                59,273                59,556                59,503                59,448   
    FINANCIAL RATIOS:                  
    Return on Average Assets 0.87 %   1.04 %   0.92 %   1.24 %   1.34 %
    Return on Average Stockholders' Equity              7.16                   8.47                   7.89                 10.38                 11.29   
    Return on Tangible Common Stockholders' Equity            11.29                 13.21                 12.75                 16.54                 18.04   
    Average Earning Assets to Average Assets            92.81                 92.91                 93.62                 93.36                 93.38   
    Allowance for Credit Losses - Loans as % of Total Loans              1.50                   1.64                   1.64                   1.67                   1.80   
    Net Charge-offs as % of Average Loans (Annualized)              1.26                   0.07                   0.10                   0.66                   0.06   
    Average Stockholders' Equity to Average Assets            12.02                 12.17                 11.58                 11.87                 11.78   
    Tax Equivalent Yield on Average Earning Assets              5.69                   5.65                   5.64                   5.55                   5.36   
    Interest Expense/Average Earning Assets              2.53                   2.55                   2.48                   2.26                   1.97   
    Net Interest Margin (FTE) on Average Earning Assets              3.16                   3.10                   3.16                   3.29                   3.39   
    Efficiency Ratio            53.84                 59.21                 63.26                 53.91                 52.21   
    Tangible Common Book Value Per Share $          25.10      $          25.07      $          25.06      $          22.43      $          23.34   

     

    LOANS                  
    (Dollars In Thousands) June 30,   March 31,   December 31,   September 30,   June 30,
      2024   2024   2023   2023   2023
    Commercial and industrial loans $      3,949,817   $      3,722,365   $      3,670,948   $      3,490,953   $      3,531,395
    Agricultural land, production and other loans to farmers            239,926              234,431              263,414              233,838              230,003
    Real estate loans:                  
    Construction            823,267              941,726              957,545           1,022,261              949,918
    Commercial real estate, non-owner occupied         2,323,533           2,368,360           2,400,839           2,360,596           2,379,819
    Commercial real estate, owner occupied         1,174,195           1,137,894           1,162,083           1,153,707           1,179,739
    Residential         2,370,905           2,316,490           2,288,921           2,257,385           2,248,473
    Home equity            631,104              618,258              617,571              609,352              614,366
    Individuals' loans for household and other personal expenditures            162,089              161,459              168,388              176,523              172,896
    Public finance and other commercial loans            964,814              964,599              956,318              966,807              963,624
    Loans       12,639,650         12,465,582         12,486,027         12,271,422         12,270,233
    Allowance for credit losses - loans          (189,537)            (204,681)            (204,934)            (205,782)            (221,147)
    NET LOANS $     12,450,113   $     12,260,901   $     12,281,093   $     12,065,640   $     12,049,086

     

    DEPOSITS                  
    (Dollars In Thousands) June 30,   March 31,   December 31,   September 30,   June 30,
      2024   2024   2023   2023   2023
    Demand deposits $      7,757,679   $      7,771,976   $      7,965,862   $      7,952,040   $      8,045,455
    Savings deposits         4,339,161           4,679,593           4,516,433           4,572,162           4,530,255
    Certificates and other time deposits of $100,000 or more         1,415,131           1,451,443           1,408,985           1,280,607           1,160,303
    Other certificates and time deposits            889,949              901,280              849,906              761,196              680,965
    Brokered certificates of deposits            167,150               80,292               80,267               80,571              164,177
    TOTAL DEPOSITS $     14,569,070   $     14,884,584   $     14,821,453   $     14,646,576   $     14,581,155

     

     

    CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST MARGIN ANALYSIS            
    (Dollars in Thousands)                      
      For the Three Months Ended
      June 30, 2024   June 30, 2023
      Average Balance   Interest
     Income /
    Expense     		  Average
    Rate     		  Average Balance   Interest
     Income /
    Expense     		  Average
    Rate
    ASSETS                      
    Interest-bearing deposits $         322,647   $        2,995   3.71 %   $         343,253   $        3,164   3.69 %
    Federal Home Loan Bank stock             41,749                879   8.42                  41,873             1,020   9.74   
    Investment Securities: (1)                      
    Taxable         1,788,749             9,051   2.02              1,876,676             8,886   1.89   
    Tax-exempt (2)         2,240,309           17,232   3.08              2,336,990           18,075   3.09   
    Total Investment Securities         4,029,058           26,283   2.61              4,213,666           26,961   2.56   
    Loans held for sale             28,585                431   6.03                  19,328                300   6.21   
    Loans: (3)                      
    Commercial         8,691,746          160,848   7.40              8,605,339          150,766   7.01   
    Real estate mortgage         2,150,591           23,799   4.43              2,031,136           20,345   4.01   
    Installment            823,417           16,335   7.94                 831,775           14,844   7.14   
    Tax-exempt (2)            926,191           10,670   4.61                 882,095             9,823   4.45   
    Total Loans       12,620,530          212,083   6.72            12,369,673          196,078   6.34   
    Total Earning Assets       17,013,984          242,240   5.69 %         16,968,465          227,223   5.36 %
    Total Non-Earning Assets         1,318,175                   1,202,184        
    TOTAL ASSETS $     18,332,159           $     18,170,649        
    LIABILITIES                      
    Interest-Bearing Deposits:                      
    Interest-bearing deposits $      5,586,549   $       40,994   2.94 %   $      5,546,232   $       34,574   2.49 %
    Money market deposits         3,036,398           27,230   3.59              2,766,876           18,684   2.70   
    Savings deposits         1,508,734             3,476   0.92              1,724,816             3,884   0.90   
    Certificates and other time deposits         2,414,967           27,451   4.55              1,883,998           16,059   3.41   
    Total Interest-Bearing Deposits       12,546,648           99,151   3.16            11,921,922           73,201   2.46   
    Borrowings            885,919             8,659   3.91              1,110,486           10,329   3.72   
    Total Interest-Bearing Liabilities       13,432,567          107,810   3.21            13,032,408           83,530   2.56   
    Noninterest-bearing deposits         2,349,219                   2,797,991        
    Other liabilities            347,012                      200,373        
    Total Liabilities       16,128,798                 16,030,772        
    STOCKHOLDERS' EQUITY         2,203,361                   2,139,877        
    TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $     18,332,159          107,810       $     18,170,649           83,530    
    Net Interest Income (FTE)     $     134,430           $     143,693    
    Net Interest Spread (FTE) (4)        2.48 %           2.80 %
                           
    Net Interest Margin (FTE):                      
    Interest Income (FTE) / Average Earning Assets         5.69 %           5.36 %
    Interest Expense / Average Earning Assets         2.53 %           1.97 %
    Net Interest Margin (FTE) (5)        3.16 %           3.39 %
                           
    (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 $5,859 and $5,858 for the three months ended June 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 Six Months Ended
      June 30, 2024   June 30, 2023
      Average Balance   Interest
     Income /
    Expense     		  Average
    Rate     		  Average Balance   Interest
     Income /
    Expense     		  Average
    Rate
    Assets:                      
    Federal Funds Sold                      
    Interest-bearing deposits $         449,173   $        9,488   4.22 %   $         258,504   $        3,801   2.94 %
    Federal Home Loan Bank stock             41,757             1,714   8.21                  40,821             1,562   7.65   
    Investment Securities: (1)                      
    Taxable         1,785,903           17,799   1.99              1,900,247           17,973   1.89   
    Tax-exempt (2)         2,243,286           34,461   3.07              2,444,086           38,416   3.14   
    Total Investment Securities         4,029,189           52,260   2.59              4,344,333           56,389   2.60   
    Loans held for sale             25,184                759   6.03                  21,952                660   6.01   
    Loans: (3)                      
    Commercial         8,644,927          320,057   7.40              8,544,945          290,428   6.80   
    Real estate mortgage         2,140,769           46,156   4.31              1,972,680           38,736   3.93   
    Installment            822,616           32,464   7.89                 836,088           28,785   6.89   
    Tax-exempt (2)            915,302           21,038   4.60                 877,511           19,581   4.46   
    Total Loans       12,548,798          420,474   6.70            12,253,176          378,190   6.17   
    Total Earning Assets       17,068,917          483,936   5.67 %         16,896,834          439,942   5.21 %
    Total Non-Earning Assets         1,312,423                   1,199,998        
    Total Assets $     18,381,340           $     18,096,832        
    Liabilities:                      
    Interest-Bearing deposits:                      
    Interest-bearing deposits $      5,503,185   $       80,484   2.92 %   $      5,405,696   $       59,237   2.19 %
    Money market deposits         3,040,938           54,613   3.59              2,756,519           32,261   2.34   
    Savings deposits         1,534,305             7,277   0.95              1,775,233             6,849   0.77   
    Certificates and other time deposits         2,421,413           55,062   4.55              1,676,291           25,539   3.05   
    Total Interest-Bearing Deposits       12,499,841          197,436   3.16            11,613,739          123,886   2.13   
    Borrowings            948,866           19,211   4.05              1,201,392           21,923   3.65   
    Total Interest-Bearing Liabilities       13,448,707          216,647   3.22            12,815,131          145,809   2.28   
    Noninterest-bearing deposits         2,388,695                   2,958,741        
    Other liabilities            321,188                      211,302        
    Total Liabilities       16,158,590                 15,985,174        
    Stockholders' Equity         2,222,750                   2,111,658        
    Total Liabilities and Stockholders' Equity $     18,381,340          216,647       $     18,096,832          145,809    
    Net Interest Income (FTE)     $     267,289           $     294,133    
    Net Interest Spread (FTE) (4)        2.45 %           2.93 %
                           
    Net Interest Margin (FTE):                      
    Interest Income (FTE) / Average Earning Assets         5.67 %           5.21 %
    Interest Expense / Average Earning Assets         2.54 %           1.73 %
    Net Interest Margin (FTE) (5)        3.13 %           3.48 %
                           
    (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  $11,655 and $12,179 for the six months ended June 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   Six Months Ended
      June 30,   March 31,   December 31,   September 30,   June 30,   June 30,   June 30,
      2024   2024   2023   2023   2023   2024   2023
    Net Income Available to Common Stockholders - GAAP $          39,456   $          47,472   $          42,010   $          55,898   $          60,393   $         86,928   $        124,003
    Adjustments:                          
    PPP loan income                   —                     —                     (7)                     (8)                     (9)                    —                   (34)
    Non-core expenses1,2                   —                3,481               12,682                     —                     —                3,481                    —
    Tax on adjustments                   —                 (848)               (3,088)                      2                      2                 (848)                      8
    Adjusted Net Income Available to Common Stockholders - Non-GAAP $          39,456   $          50,105   $          51,597   $          55,892   $          60,386   $         89,561   $        123,977
                               
    Average Diluted Common Shares Outstanding (in thousands)             58,328               59,273               59,556               59,503               59,448              58,800              59,446
                               
    Diluted Earnings Per Common Share - GAAP $             0.68   $             0.80   $             0.71   $             0.94   $             1.02   $             1.48   $             2.09
    Adjustments:                          
    PPP loan income                   —                     —                     —                     —                     —                    —                    —
    Non-core expenses1,2                   —                  0.06                  0.21                     —                     —                 0.06                    —
    Tax on adjustments                   —                 (0.01)                 (0.05)                     —                     —                (0.01)                    —
    Adjusted Diluted Earnings Per Common Share - Non-GAAP $             0.68   $             0.85   $             0.87   $             0.94   $             1.02   $             1.53   $             2.09

    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   Six Months Ended
      June 30,   March 31,   December 31,   September 30,   June 30,   June 30,   June 30,
      2024   2024   2023   2023   2023   2024   2023
    Net Interest Income (GAAP) $     128,571      $     127,063      $     130,063      $     133,383      $     137,835      $     255,634      $     281,954   
    Fully Taxable Equivalent ("FTE") Adjustment            5,859                 5,795                 5,853                 5,911                 5,858               11,655               12,179   
    Net Interest Income (FTE) (non-GAAP) $     134,430      $     132,858      $     135,916      $     139,294      $     143,693      $     267,289      $     294,133   
                               
    Average Earning Assets (GAAP) $ 17,013,984      $ 17,123,851      $ 17,222,714      $ 16,947,669      $ 16,968,465      $ 17,068,917      $ 16,896,834   
    Net Interest Margin (GAAP) 3.02 %   2.97 %   3.02 %   3.15 %   3.25 %   3.00 %   3.34 %
    Net Interest Margin (FTE) (non-GAAP) 3.16 %   3.10 %   3.16 %   3.29 %   3.39 %   3.13 %   3.48 %

     

    RETURN ON TANGIBLE COMMON EQUITY - NON-GAAP
    (Dollars In Thousands) Three Months Ended   Six Months Ended
      June 30,   March 31,   December 31,   September 30,   June 30,   June 30,   June 30,
      2024   2024   2023   2023   2023   2024   2023
    Total Average Stockholders' Equity (GAAP) $   2,203,361      $   2,242,139      $   2,130,993      $   2,154,232      $   2,139,877      $  2,222,750      $  2,111,658   
    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       (730,980)           (732,432)           (734,007)           (735,787)           (737,489)          (731,706)          (738,334)  
    Average Tangible Common Equity, Net of Tax (Non-GAAP) $   1,447,256      $   1,484,582      $   1,371,861      $   1,393,320      $   1,377,263      $  1,465,919      $  1,348,199   
                               
    Net Income Available to Common Stockholders (GAAP) $       39,456      $       47,472      $       42,010      $       55,898      $       60,393      $       86,928      $     124,003   
    Plus: Intangible Asset Amortization, Net of Tax            1,399                 1,546                 1,724                 1,724                 1,724                2,945                3,458   
    Tangible Net Income (Non-GAAP) $       40,855      $       49,018      $       43,734      $       57,622      $       62,117      $       89,873      $     127,461   
                               
    Return on Tangible Common Equity (Non-GAAP) 11.29 %   13.21 %   12.75 %   16.54 %   18.04 %   12.26 %   18.91 %
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