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FMB Quarterly Earnings Graphic with Coins and Arrows Showing Money Growth

Thursday, January 30, 2025

First Merchants Corporation (NASDAQ - FRME) 


Fourth Quarter 2024 Highlights:

  • Net income available to common stockholders was $63.9 million and diluted earnings per common share totaled $1.10, compared to $48.7 million and $0.84 in the third quarter of 2024, and $42.0 million and $0.71 in the fourth quarter of 2023.  Excluding the impact of the branch sale and repositioning of the available for sale securities portfolio, adjusted net income available to common stockholders1 was $58.1 million or $1.00 per share for the fourth quarter of 2024.
  • Strong capital position with Common Equity Tier 1 Capital Ratio of 11.43% and Tangible Common Equity to Tangible Assets Ratio of 8.81%. 
  • Net interest margin was 3.28% compared to 3.23% on a linked quarter basis and 3.16% in the fourth quarter of 2023.
  • Total loans grew $185.6 million, or 5.9% annualized, on a linked quarter basis, and $368.1 million, or 2.9% during the last twelve months.
  • Total deposits increased $156.5 million, or 4.4% annualized, on a linked quarter basis, and declined $32.4 million, or 0.2%, during the last twelve months after normalizing for deposits sold during the fourth quarter.
  • Nonperforming assets to total assets were 43 basis points compared to 35 basis points on a linked quarter basis.
  • Adjusted efficiency ratio totaled 53.60%1 for the quarter.
  • Completed the sale of five Illinois branches and certain loans and deposits to Old Second National Bank on December 6, 2024.

"The fourth quarter was a strong finish to the year and showed the momentum we have built with healthy increases in core earnings, NIM and ROA," said Mark Hardwick, Chief Executive Officer of First Merchants Bank. "We restructured a portion of our securities portfolio and completed the Illinois branch sale to help prioritize our core markets.  These actions and the completion of multiple technology initiatives in 2024 have positioned First Merchants to deliver strong results in 2025."

 


Fourth Quarter Financial Results:

First Merchants Corporation (the “Corporation”) reported fourth quarter 2024 net income available to common stockholders of $63.9 million compared to $42.0 million during the same period in 2023.  Diluted earnings per common share for the period totaled $1.10 compared to the fourth quarter of 2023 result of $0.71. Excluding non-core income and expenses incurred in each period, adjusted net income available to common stockholders1 for the fourth quarter 2024 was $58.1 million, or $1.00 diluted earnings per common share compared to $53.4 million, or $0.90 in the same period in 2023.

During the quarter, the Corporation completed the sale of five Illinois branches along with loans of $7.4 million and deposits of $267.4 million, generating a gain of $20.0 million recorded in non-interest income. The sale of these branches represents the Corporation’s exit from suburban Chicago markets. 

Total assets equaled $18.3 billion and loans totaled $12.9 billion as of quarter-end.  During the past twelve months, total loans grew by $368.1 million, or 2.9%. On a linked quarter basis, loans grew $185.6 million, or 5.9% annualized, with growth primarily in commercial loans.

Investments totaling $3.5 billion decreased $350.7 million, or 9.2%, during the last twelve months and decreased $201.5 million on a linked quarter basis. The decline during the quarter was partially due to the sale of $109.6 million of available for sale securities with a weighted average tax-equivalent yield of 2.31%, which resulted in a loss of $11.6 million. The remaining decline for the quarter was due to security paydowns and maturities, as well as a decline in valuation of securities reflecting the movement of interest rates. Sales of available for sale securities in 2024 totaled $268.5 million and resulted in a loss of $20.8 million.

Total deposits were $14.5 billion as of quarter-end and decreased by $299.8 million, or 2.0%, over the past twelve months. The decline was primarily due to the sale of the Illinois branches during the fourth quarter which included $267.4 million of deposits.  Excluding this impact, deposits declined by $32.4 million in 2024.  On a linked quarter basis, deposits grew by $156.5 million, or 4.4% annualized.  The loan to deposit ratio increased slightly to 88.5% at period end from 88.0% in the prior quarter.

The Corporation’s Allowance for Credit Losses – Loans (ACL) totaled $192.8 million as of quarter-end, or 1.50% of total loans, an increase of $4.9 million from prior quarter.  Loan charge-offs, net of recoveries totaled $0.8 million and provision for loans of $5.7 million was recorded during the quarter.  Reserves for unfunded commitments totaled $18.0 million declining during the quarter due to reserve release of $1.5 million.  Net provision for the quarter totaled $4.2 million.  Non-performing assets to total assets were 43 basis points for the fourth quarter of 2024, an increase of eight basis points compared to 35 basis points in the prior quarter.

Net interest income totaled $134.4 million for the quarter, an increase of $3.3 million, or 2.5%, compared to the prior quarter and an increase of $4.3 million, or 3.3%, compared to the fourth quarter of 2023. Fully taxable equivalent net interest margin was 3.28%, an increase of five basis points compared to the third quarter of 2024, and an increase of 12 basis points compared to the fourth quarter of 2023.  The increase in net interest margin compared to the third quarter was due to lower funding costs and a more favorable earning asset and funding mix.  

Noninterest income totaled $42.7 million for the quarter, an increase of $17.9 million compared to the third quarter of 2024 and an increase of $16.3 million compared to the fourth quarter of 2023. When excluding non-core income from each period, noninterest income totaled $34.4 million for the quarter, an increase of $0.4 million compared to third quarter of 2024, and an increase of $5.6 million compared to the fourth quarter of 2023.  The increase in core noninterest income over the fourth quarter of 2023 was primarily due to an increase in gains on sales of loans and CRA investment income.   

Noninterest expense totaled $96.3 million for the quarter, an increase of $1.7 million from the third quarter of 2024 and a decrease of $11.8 million from the fourth quarter of 2023.  The increase in the linked quarter was from higher marketing costs and other one-time operating expenses.  The decrease from the fourth quarter of 2023 was due to one-time charges incurred in the prior year which included an FDIC special assessment, early retirement and severance costs, and a lease termination.

The Corporation’s total risk-based capital ratio totaled 13.31%, common equity tier 1 capital ratio totaled 11.43%, and the tangible common equity ratio totaled 8.81%.  These ratios continue to reflect the Corporation’s strong liquidity and capital positions.

1 See “Non-GAAP Financial Information” for reconciliation

 

CONFERENCE CALL

First Merchants Corporation will conduct a fourth quarter earnings conference call and web cast at 11:30 a.m. (ET) on Thursday, January 30, 2025. 

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/BIc49ad0293a7844dca2e7171f51e600dd95f36e86b6)

To view the webcast and presentation slides, please go to (https://edge.media-server.com/mmc/p/9t5v76m2) during the time of the call. A replay of the webcast will be available until January 30, 2026.  

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) December 31,
 2024  2023
ASSETS    
Cash and due from banks $                    87,616  $                  112,649
Interest-bearing deposits                     298,891                      436,080
Investment securities, net of allowance for credit losses of $245,000 and $245,000                  3,460,695                   3,811,364
Loans held for sale                      18,663                       18,934
Loans                12,854,359                 12,486,027
Less: Allowance for credit losses - loans                   (192,757)                    (204,934)
Net loans                12,661,602                 12,281,093
Premises and equipment                     129,743                      133,896
Federal Home Loan Bank stock                      41,690                       41,769
Interest receivable                      91,829                       97,664
Goodwill and other intangibles                     731,830                      739,101
Cash surrender value of life insurance                     304,906                      306,301
Other real estate owned                        4,948                         4,831
Tax asset, deferred and receivable                      92,387                       99,883
Other assets                     387,169                      322,322
TOTAL ASSETS $              18,311,969  $              18,405,887
LIABILITIES    
Deposits:    
Noninterest-bearing $               2,325,579  $               2,500,062
Interest-bearing                12,196,047                 12,321,391
Total Deposits                14,521,626                 14,821,453
Borrowings:    
Federal funds purchased                      99,226                              —
Securities sold under repurchase agreements                     142,876                      157,280
Federal Home Loan Bank advances                     822,554                      712,852
Subordinated debentures and other borrowings                      93,529                      158,644
Total Borrowings                  1,158,185                   1,028,776
Interest payable                      16,102                       18,912
Other liabilities                     311,073                      289,033
Total Liabilities                16,006,986                 16,158,174
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 - 57,974,535 and 59,424,122 shares                        7,247                         7,428
Additional paid-in capital                  1,188,768                   1,236,506
Retained earnings                  1,272,528                   1,154,624
Accumulated other comprehensive loss                   (188,685)                    (175,970)
Total Stockholders' Equity                  2,304,983                   2,247,713
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $              18,311,969  $              18,405,887


CONSOLIDATED STATEMENTS OF INCOME Three Months Ended  Twelve Months Ended
(Dollars In Thousands, Except Per Share Amounts) December 31,  December 31,
 2024  2023  2024  2023
INTEREST INCOME        
Loans:        
Taxable $              197,536  $              197,523  $              803,652  $              747,837
Tax-exempt                    9,020                     8,197                   34,262                   31,954
Investment securities:        
Taxable                    9,024                     8,644                   36,086                   35,207
Tax-exempt                  12,754                   13,821                   53,487                   58,117
Deposits with financial institutions                    5,350                     8,034                   16,992                   17,719
Federal Home Loan Bank stock                      958                       771                     3,527                     3,052
Total Interest Income                234,642                 236,990                 948,006                 893,886
INTEREST EXPENSE        
Deposits                  89,835                   96,655                 386,127                 306,092
Federal funds purchased                        26                           1                       481                     1,421
Securities sold under repurchase agreements                      680                       827                     3,057                     3,451
Federal Home Loan Bank advances                    8,171                     6,431                   29,886                   27,206
Subordinated debentures and other borrowings                    1,560                     3,013                     7,341                   10,316
Total Interest Expense                100,272                 106,927                 426,892                 348,486
NET INTEREST INCOME                134,370                 130,063                 521,114                 545,400
Provision for credit losses                    4,200                     1,500                   35,700                     3,500
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES                130,170                 128,563                 485,414                 541,900
NONINTEREST INCOME        
Service charges on deposit accounts                    8,124                     7,690                   32,606                   30,837
Fiduciary and wealth management fees                    8,665                     8,187                   34,215                   30,840
Card payment fees                    4,957                     4,437                   19,317                   18,862
Net gains and fees on sales of loans                    5,681                     4,111                   20,840                   15,659
Derivative hedge fees                    1,594                     1,049                     3,082                     3,385
Other customer fees                      316                       237                     1,547                     1,880
Earnings on cash surrender value of life insurance                    2,188                     3,202                     8,464                     8,347
Net realized losses on sales of available for sale securities                 (11,592)                   (2,317)                  (20,757)                   (6,930)
Gain on branch sale                  19,983                         —                   19,983                         —
Other income (loss)                    2,826                      (152)                     6,283                     2,722
Total Noninterest Income                  42,742                   26,444                 125,580                 105,602
NONINTEREST EXPENSES        
Salaries and employee benefits                  55,437                   60,967                 221,167                 228,745
Net occupancy                    7,335                     9,089                   28,387                   29,859
Equipment                    7,028                     6,108                   26,802                   24,113
Marketing                    2,582                     2,647                     7,389                     7,427
Outside data processing fees                    6,029                     5,875                   27,140                   25,165
Printing and office supplies                      377                       402                     1,462                     1,552
Intangible asset amortization                    1,771                     2,182                     7,271                     8,743
FDIC assessments                    3,744                     7,557                   15,029                   14,674
Other real estate owned and foreclosure expenses                      227                     1,743                     2,076                     3,318
Professional and other outside services                    3,777                     3,981                   14,586                   16,172
Other expenses                    7,982                     7,552                   27,957                   28,502
Total Noninterest Expenses                  96,289                 108,103                 379,266                 388,270
INCOME BEFORE INCOME TAX                  76,623                   46,904                 231,728                 259,232
Income tax expense                  12,274                     4,425                   30,326                   35,446
NET INCOME                  64,349                   42,479                 201,402                 223,786
Preferred stock dividends                      469                       469                     1,875                     1,875
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS $               63,880  $               42,010  $              199,527  $              221,911
Per Share Data:        
Basic Net Income Available to Common Stockholders $                   1.10  $                   0.71  $                   3.42  $                   3.74
Diluted Net Income Available to Common Stockholders $                   1.10  $                   0.71  $                   3.41  $                   3.73
Cash Dividends Paid to Common Stockholders $                   0.35  $                   0.34  $                   1.39  $                   1.34
Average Diluted Common Shares Outstanding (in thousands)                  58,247                   59,556                   58,533                   59,489

 

FINANCIAL HIGHLIGHTS        
(Dollars in thousands) Three Months Ended  Twelve Months Ended
 December 31,  December 31,
 2024  2023  2024  2023
NET CHARGE-OFFS $                 771     $              3,148     $             49,377     $             25,643   
        
AVERAGE BALANCES:        
Total Assets $       18,478,303     $       18,397,200     $       18,400,495     $       18,186,507   
Total Loans         12,757,676             12,396,451             12,634,324             12,297,974   
Total Earning Assets         17,089,198             17,222,714             17,054,267             16,991,787   
Total Deposits         14,788,294             15,000,580             14,816,564             14,721,498   
Total Stockholders' Equity           2,312,270               2,130,993               2,252,491               2,127,262   
        
FINANCIAL RATIOS:        
Return on Average Assets 1.39 %  0.92 %  1.09 %  1.23 %
Return on Average Stockholders' Equity                 11.05                       7.89                       8.86                     10.43   
Return on Tangible Common Stockholders' Equity                 16.75                     12.75                     13.71                     16.76   
Average Earning Assets to Average Assets                 92.48                     93.62                     92.68                     93.43   
Allowance for Credit Losses - Loans as % of Total Loans                   1.50                       1.64                       1.50                       1.64   
Net Charge-offs as % of Average Loans (Annualized)                   0.02                       0.10                       0.39                       0.21   
Average Stockholders' Equity to Average Assets                 12.51                     11.58                     12.24                     11.70   
Tax Equivalent Yield on Average Earning Assets                   5.63                       5.64                       5.69                       5.40   
Interest Expense/Average Earning Assets                   2.35                       2.48                       2.50                       2.05   
Net Interest Margin (FTE) on Average Earning Assets                   3.28                       3.16                       3.19                       3.35   
Efficiency Ratio                 48.48                     63.26                     53.55                     55.17   
Tangible Common Book Value Per Share $              26.78     $              25.06     $              26.78     $              25.06   

 

NONPERFORMING ASSETS          
(Dollars In Thousands) December 31,  September 30,  June 30,  March 31,  December 31,
 2024  2024  2024  2024  2023
Nonaccrual Loans $        73,773     $        59,088     $        61,906     $        62,478     $        53,580   
Other Real Estate Owned and Repossessions            4,948                5,247                4,824                4,886                4,831   
Nonperforming Assets (NPA)           78,721               64,335               66,730               67,364               58,411   
90+ Days Delinquent            5,902               14,105                1,686                2,838                   172   
NPAs & 90 Day Delinquent $        84,623     $        78,440     $        68,416     $        70,202     $        58,583   
          
Allowance for Credit Losses - Loans $      192,757     $      187,828     $      189,537     $      204,681     $      204,934   
Quarterly Net Charge-offs               771                6,709               39,644                2,253                3,148   
NPAs / Actual Assets % 0.43 %  0.35 %  0.36 %  0.37 %  0.32 %
NPAs & 90 Day / Actual Assets % 0.46 %  0.43 %  0.37 %  0.38 %  0.32 %
NPAs / Actual Loans and OREO % 0.61 %  0.51 %  0.53 %  0.54 %  0.47 %
Allowance for Credit Losses - Loans / Actual Loans (%) 1.50 %  1.48 %  1.50 %  1.64 %  1.64 %
Net Charge-offs as % of Average Loans (Annualized) 0.02 %  0.21 %  1.26 %  0.07 %  0.10 %

 

CONSOLIDATED BALANCE SHEETS          
(Dollars In Thousands) December 31,  September 30,  June 30,  March 31,  December 31,
 2024  2024  2024  2024  2023
ASSETS          
Cash and due from banks $           87,616  $           84,719  $         105,372  $         100,514  $         112,649
Interest-bearing deposits            298,891             359,126             168,528             410,497             436,080
Investment securities, net of allowance for credit losses         3,460,695          3,662,145          3,753,088          3,783,574          3,811,364
Loans held for sale             18,663              40,652              32,292              15,118              18,934
Loans       12,854,359        12,646,808        12,639,650        12,465,582        12,486,027
Less: Allowance for credit losses - loans          (192,757)           (187,828)           (189,537)           (204,681)           (204,934)
Net loans       12,661,602        12,458,980        12,450,113        12,260,901        12,281,093
Premises and equipment            129,743             129,582             133,245             132,706             133,896
Federal Home Loan Bank stock             41,690              41,716              41,738              41,758              41,769
Interest receivable             91,829              92,055              97,546              92,550              97,664
Goodwill and other intangibles            731,830             733,601             735,373             737,144             739,101
Cash surrender value of life insurance            304,906             304,613             306,379             306,028             306,301
Other real estate owned               4,948                5,247                4,824                4,886                4,831
Tax asset, deferred and receivable             92,387              86,732             107,080             101,121              99,883
Other assets            387,169             348,384             367,845             331,006             322,322
TOTAL ASSETS $     18,311,969  $     18,347,552  $     18,303,423  $     18,317,803  $     18,405,887
LIABILITIES          
Deposits:          
Noninterest-bearing $      2,325,579  $      2,334,197  $      2,303,313  $      2,338,364  $      2,500,062
Interest-bearing       12,196,047        12,030,903        12,265,757        12,546,220        12,321,391
Total Deposits       14,521,626        14,365,100        14,569,070        14,884,584        14,821,453
Borrowings:          
Federal funds purchased             99,226              30,000             147,229                     —                     —
Securities sold under repurchase agreements            142,876             124,894             100,451             130,264             157,280
Federal Home Loan Bank advances            822,554             832,629             832,703             612,778             712,852
Subordinated debentures and other borrowings             93,529              93,562              93,589             118,612             158,644
Total Borrowings         1,158,185          1,081,085          1,173,972             861,654          1,028,776
Deposits and other liabilities held for sale                    —             288,476                     —                     —                     —
Interest payable             16,102              18,089              18,554              19,262              18,912
Other liabilities            311,073             292,429             329,302             327,500             289,033
Total Liabilities       16,006,986        16,045,179        16,090,898        16,093,000        16,158,174
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               7,247                7,265                7,256                7,321                7,428
Additional paid-in capital         1,188,768          1,192,683          1,191,193          1,208,447          1,236,506
Retained earnings         1,272,528          1,229,125          1,200,930          1,181,939          1,154,624
Accumulated other comprehensive loss          (188,685)           (151,825)           (211,979)           (198,029)           (175,970)
Total Stockholders' Equity         2,304,983          2,302,373          2,212,525          2,224,803          2,247,713
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $     18,311,969  $     18,347,552  $     18,303,423  $     18,317,803  $     18,405,887
          


CONSOLIDATED STATEMENTS OF INCOME          
(Dollars In Thousands, Except Per Share Amounts) December 31,  September 30,  June 30,  March 31,  December 31,
 2024  2024  2024  2024  2023
INTEREST INCOME          
Loans:          
Taxable $      197,536     $      206,680     $      201,413     $      198,023     $      197,523   
Tax-exempt            9,020                8,622                8,430                8,190                8,197   
Investment securities:          
Taxable            9,024                9,263                9,051                8,748                8,644   
Tax-exempt           12,754               13,509               13,613               13,611               13,821   
Deposits with financial institutions            5,350                2,154                2,995                6,493                8,034   
Federal Home Loan Bank stock               958                   855                   879                   835                   771   
Total Interest Income         234,642             241,083             236,381             235,900             236,990   
INTEREST EXPENSE          
Deposits           89,835               98,856               99,151               98,285               96,655   
Federal funds purchased                 26                   329                   126                     —                      1   
Securities sold under repurchase agreements               680                   700                   645                1,032                   827   
Federal Home Loan Bank advances            8,171                8,544                6,398                6,773                6,431   
Subordinated debentures and other borrowings            1,560                1,544                1,490                2,747                3,013   
Total Interest Expense         100,272             109,973             107,810             108,837             106,927   
NET INTEREST INCOME         134,370             131,110             128,571             127,063             130,063   
Provision for credit losses            4,200                5,000               24,500                2,000                1,500   
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES         130,170             126,110             104,071             125,063             128,563   
NONINTEREST INCOME          
Service charges on deposit accounts            8,124                8,361                8,214                7,907                7,690   
Fiduciary and wealth management fees            8,665                8,525                8,825                8,200                8,187   
Card payment fees            4,957                5,121                4,739                4,500                4,437   
Net gains and fees on sales of loans            5,681                6,764                5,141                3,254                4,111   
Derivative hedge fees            1,594                   736                   489                   263                1,049   
Other customer fees               316                   344                   460                   427                   237   
Earnings on cash surrender value of life insurance            2,188                2,755                1,929                1,592                3,202   
Net realized losses on sales of available for sale securities         (11,592)              (9,114)                  (49)                    (2)              (2,317)  
Gain on branch sale           19,983                     —                     —                     —                     —   
Other income (loss)            2,826                1,374                1,586                   497                 (152)  
Total Noninterest Income           42,742               24,866               31,334               26,638               26,444   
NONINTEREST EXPENSES          
Salaries and employee benefits           55,437               55,223               52,214               58,293               60,967   
Net occupancy            7,335                6,994                6,746                7,312                9,089   
Equipment            7,028                6,949                6,599                6,226                6,108   
Marketing            2,582                1,836                1,773                1,198                2,647   
Outside data processing fees            6,029                7,150                7,072                6,889                5,875   
Printing and office supplies               377                   378                   354                   353                   402   
Intangible asset amortization            1,771                1,772                1,771                1,957                2,182   
FDIC assessments            3,744                3,720                3,278                4,287                7,557   
Other real estate owned and foreclosure expenses               227                   942                   373                   534                1,743   
Professional and other outside services            3,777                3,035                3,822                3,952                3,981   
Other expenses            7,982                6,630                7,411                5,934                7,552   
Total Noninterest Expenses           96,289               94,629               91,413               96,935             108,103   
INCOME BEFORE INCOME TAX           76,623               56,347               43,992               54,766               46,904   
Income tax expense           12,274                7,160                4,067                6,825                4,425   
NET INCOME           64,349               49,187               39,925               47,941               42,479   
Preferred stock dividends               469                   468                   469                   469                   469   
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS $        63,880     $        48,719     $        39,456     $        47,472     $        42,010   
Per Share Data:          
Basic Net Income Available to Common Stockholders $           1.10     $           0.84     $           0.68     $           0.80     $           0.71   
Diluted Net Income Available to Common Stockholders $           1.10     $           0.84     $           0.68     $           0.80     $           0.71   
Cash Dividends Paid to Common Stockholders $           0.35     $           0.35     $           0.35     $           0.34     $           0.34   
Average Diluted Common Shares Outstanding (in thousands)           58,247               58,289               58,328               59,273               59,556   
FINANCIAL RATIOS:          
Return on Average Assets 1.39 %  1.07 %  0.87 %  1.04 %  0.92 %
Return on Average Stockholders' Equity            11.05                  8.66                  7.16                  8.47                  7.89   
Return on Tangible Common Stockholders' Equity            16.75                13.39                11.29                13.21                12.75   
Average Earning Assets to Average Assets            92.48                92.54                92.81                92.91                93.62   
Allowance for Credit Losses - Loans as % of Total Loans              1.50                  1.48                  1.50                  1.64                  1.64   
Net Charge-offs as % of Average Loans (Annualized)              0.02                  0.21                  1.26                  0.07                  0.10   
Average Stockholders' Equity to Average Assets            12.51                12.26                12.02                12.17                11.58   
Tax Equivalent Yield on Average Earning Assets              5.63                  5.82                  5.69                  5.65                  5.64   
Interest Expense/Average Earning Assets              2.35                  2.59                  2.53                  2.55                  2.48   
Net Interest Margin (FTE) on Average Earning Assets              3.28                  3.23                  3.16                  3.10                  3.16   
Efficiency Ratio            48.48                53.76                53.84                59.21                63.26   
Tangible Common Book Value Per Share $          26.78     $          26.64     $          25.10     $          25.07     $          25.06   

 

LOANS          
(Dollars In Thousands) December 31,  September 30,  June 30,  March 31,  December 31,
 2024  2024  2024  2024  2023
Commercial and industrial loans $      4,114,292  $      4,041,217  $      3,949,817  $      3,722,365  $      3,670,948
Agricultural land, production and other loans to farmers            256,312             238,743             239,926             234,431             263,414
Real estate loans:          
Construction            792,144             814,704             823,267             941,726             957,545
Commercial real estate, non-owner occupied         2,274,016          2,251,351          2,323,533          2,368,360          2,400,839
Commercial real estate, owner occupied         1,157,944          1,152,751          1,174,195          1,137,894          1,162,083
Residential         2,374,729          2,366,943          2,370,905          2,316,490          2,288,921
Home equity            659,811             641,188             631,104             618,258             617,571
Individuals' loans for household and other personal expenditures            166,028             158,480             162,089             161,459             168,388
Public finance and other commercial loans         1,059,083             981,431             964,814             964,599             956,318
Loans       12,854,359        12,646,808        12,639,650        12,465,582        12,486,027
Allowance for credit losses - loans          (192,757)           (187,828)           (189,537)           (204,681)           (204,934)
NET LOANS $     12,661,602  $     12,458,980  $     12,450,113  $     12,260,901  $     12,281,093

 

DEPOSITS          
(Dollars In Thousands) December 31,  September 30,  June 30,  March 31,  December 31,
 2024  2024  2024  2024  2023
Demand deposits $      7,980,061  $      7,678,510  $      7,757,679  $      7,771,976  $      7,965,862
Savings deposits         4,522,758          4,302,236          4,339,161          4,679,593          4,516,433
Certificates and other time deposits of $100,000 or more         1,043,068          1,277,833          1,415,131          1,451,443          1,408,985
Other certificates and time deposits            692,068             802,949             889,949             901,280             849,906
Brokered certificates of deposits1            283,671             303,572             167,150              80,292              80,267
TOTAL DEPOSITS2$     14,521,626  $     14,365,100  $     14,569,070  $     14,884,584  $     14,821,453

1 - Total brokered deposits of $955.7 million, which includes brokered CD's of $283.7 million at December 31, 2024.

2 - Total deposits at September 30, 2024 excluded $287.7 million of deposits reclassified to Deposits and other liabilities held for sale related to the Illinois branch sale.  The sale of $267.4 million of deposits associated with the Illinois branch sale was subsequently completed on December 6, 2024.


CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST MARGIN ANALYSIS       
(Dollars in Thousands)            
 For the Three Months Ended
 December 31, 2024  December 31, 2023
 Average Balance  Interest
 Income /
Expense 		 Average
Rate 		 Average Balance  Interest
 Income /
Expense 		 Average
Rate
ASSETS            
Interest-bearing deposits $         522,868  $        5,350  4.09 %  $         700,705  $        8,034  4.59 %
Federal Home Loan Bank stock             41,703               958  9.19                 41,792               771  7.38   
Investment Securities: (1)            
Taxable         1,677,554            9,024  2.15             1,801,533            8,644  1.92   
Tax-exempt (2)         2,089,397          16,144  3.09             2,282,233          17,495  3.07   
Total Investment Securities         3,766,951          25,168  2.67             4,083,766          26,139  2.56   
Loans held for sale             36,219               550  6.07                 16,355               246  6.02   
Loans: (3)            
Commercial         8,753,723         156,414  7.15             8,533,233         159,190  7.46   
Real estate mortgage         2,177,351          24,401  4.48             2,118,060          21,829  4.12   
HELOC and installment            841,537          16,171  7.69                820,728          16,258  7.92   
Tax-exempt (2)            948,846          11,418  4.81                908,075          10,376  4.57   
Total Loans       12,757,676         208,954  6.55           12,396,451         207,899  6.71   
Total Earning Assets       17,089,198         240,430  5.63 %        17,222,714         242,843  5.64 %
Total Non-Earning Assets         1,389,105              1,174,486     
TOTAL ASSETS $     18,478,303      $     18,397,200     
LIABILITIES            
Interest-Bearing Deposits:            
Interest-bearing deposits $      5,564,228  $       37,049  2.66 %  $      5,504,725  $       40,996  2.98 %
Money market deposits         3,189,334          25,463  3.19             3,096,085          27,909  3.61   
Savings deposits         1,362,705            3,102  0.91             1,587,758            3,913  0.99   
Certificates and other time deposits         2,313,284          24,221  4.19             2,225,528          23,837  4.28   
Total Interest-Bearing Deposits       12,429,551          89,835  2.89           12,414,096          96,655  3.11   
Borrowings         1,049,677          10,437  3.98             1,013,856          10,272  4.05   
Total Interest-Bearing Liabilities       13,479,228         100,272  2.98           13,427,952         106,927  3.19   
Noninterest-bearing deposits         2,358,743              2,586,484     
Other liabilities            328,062                 251,771     
Total Liabilities       16,166,033            16,266,207     
STOCKHOLDERS' EQUITY         2,312,270              2,130,993     
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $     18,478,303         100,272    $     18,397,200         106,927   
Net Interest Income (FTE)   $     140,158      $     135,916   
Net Interest Spread (FTE) (4)    2.65 %      2.45 %
            
Net Interest Margin (FTE):            
Interest Income (FTE) / Average Earning Assets     5.63 %      5.64 %
Interest Expense / Average Earning Assets     2.35 %      2.48 %
Net Interest Margin (FTE) (5)    3.28 %      3.16 %
            
(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 $5,788 and $5,853 for the three months ended December 31, 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 Twelve Months Ended
 December 31, 2024  December 31, 2023
 Average Balance  Interest
 Income /
Expense 		 Average
Rate 		 Average Balance  Interest
 Income /
Expense 		 Average
Rate
Assets:            
Interest-bearing deposits $         418,163  $       16,992  4.06 %  $         431,581  $       17,719  4.11 %
Federal Home Loan Bank stock             41,736            3,527  8.45                 41,319            3,052  7.39   
Investment Securities: (1)            
Taxable         1,759,578          36,086  2.05             1,854,438          35,207  1.90   
Tax-exempt (2)         2,200,466          67,705  3.08             2,366,475          73,566  3.11   
Total Investment Securities         3,960,044         103,791  2.62             4,220,913         108,773  2.58   
Loans held for sale             29,650            1,792  6.04                 21,766            1,292  5.94   
Loans: (3)            
Commercial         8,687,638         641,393  7.38             8,519,706         603,611  7.08   
Real estate mortgage         2,158,743          94,890  4.40             2,035,488          82,183  4.04   
HELOC and installment            830,079          65,577  7.90                830,006          60,751  7.32   
Tax-exempt (2)            928,214          43,370  4.67                891,008          40,448  4.54   
Total Loans       12,634,324         847,022  6.70           12,297,974         788,285  6.41   
Total Earning Assets       17,054,267         971,332  5.69 %        16,991,787         917,829  5.40 %
Total Non-Earning Assets         1,346,228              1,194,720     
Total Assets $     18,400,495      $     18,186,507     
Liabilities:            
Interest-Bearing deposits:            
Interest-bearing deposits $      5,506,492  $     157,984  2.87 %  $      5,435,733  $     138,012  2.54 %
Money market deposits         3,061,461         106,026  3.46             2,884,271          83,777  2.90   
Savings deposits         1,463,707          14,587  1.00             1,694,230          14,606  0.86   
Certificates and other time deposits         2,413,900         107,530  4.45             1,923,268          69,697  3.62   
Total Interest-Bearing Deposits       12,445,560         386,127  3.10           11,937,502         306,092  2.56   
Borrowings         1,005,017          40,765  4.06             1,111,472          42,394  3.81   
Total Interest-Bearing Liabilities       13,450,577         426,892  3.17           13,048,974         348,486  2.67   
Noninterest-bearing deposits         2,371,004              2,783,996     
Other liabilities            326,423                 226,275     
Total Liabilities       16,148,004            16,059,245     
Stockholders' Equity         2,252,491              2,127,262     
Total Liabilities and Stockholders' Equity $     18,400,495         426,892    $     18,186,507         348,486   
Net Interest Income (FTE)   $     544,440      $     569,343   
Net Interest Spread (FTE) (4)    2.52 %      2.73 %
            
Net Interest Margin (FTE):            
Interest Income (FTE) / Average Earning Assets     5.69 %      5.40 %
Interest Expense / Average Earning Assets     2.50 %      2.05 %
Net Interest Margin (FTE) (5)    3.19 %      3.35 %
            
(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  $23,326 and $23,943 for the years ended December 31, 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  Twelve Months Ended
 December 31,  September 30,  June 30,  March 31,  December 31,  December 31,  December 31,
 2024  2024  2024  2024  2023  2024  2023
Net Income Available to Common Stockholders - GAAP $          63,880  $          48,719  $          39,456  $          47,472  $          42,010  $        199,527  $        221,911
Adjustments:              
PPP loan income                   —                    —                    —                    —                    (7)                   —                  (49)
Net realized losses on sales of available for sale securities             11,592               9,114                    49                     2               2,317             20,757               6,930
Gain on branch sale           (19,983)                    —                    —                    —                    —            (19,983)                   —
Non-core expenses1,2,3                 762                    —                    —               3,481              12,682               4,243             12,682
Tax on adjustments              1,851              (2,220)                  (12)                (848)              (3,652)             (1,229)             (4,767)
Adjusted Net Income Available to Common Stockholders - Non-GAAP $          58,102  $          55,613  $          39,493  $          50,107  $          53,350  $        203,315  $        236,707
              
Average Diluted Common Shares Outstanding (in thousands)             58,247              58,289              58,328              59,273              59,556             58,533             59,489
              
Diluted Earnings Per Common Share - GAAP $             1.10  $             0.84  $             0.68  $             0.80  $             0.71  $             3.41  $             3.73
Adjustments:              
PPP loan income                   —                    —                    —                    —                    —                   —                   —
Net realized losses on sales of available for sale securities                0.20                 0.15                    —                    —                 0.04                0.35                0.12
Gain on branch sale               (0.34)                    —                    —                    —                    —               (0.34)                   —
Non-core expenses1,2,3                0.01                    —                    —                 0.06                 0.21                0.07                0.21
Tax on adjustments                0.03                (0.04)                    —                (0.01)                (0.06)               (0.02)               (0.08)
Adjusted Diluted Earnings Per Common Share - Non-GAAP $             1.00  $             0.95  $             0.68  $             0.85  $             0.90  $             3.47  $             3.98

1 - Non-core expenses in 4Q24 included $0.8 million of costs directly related to the branch sale.

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.

3 - 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.


NET INTEREST MARGIN ("NIM"), ADJUSTED         
(Dollars in Thousands)         
 Three Months Ended  Twelve Months Ended
 December 31,  September 30,  June 30,  March 31,  December 31,  December 31,  December 31,
 2024  2024  2024  2024  2023  2024  2023
Net Interest Income (GAAP) $     134,370     $     131,110     $     128,571     $     127,063     $     130,063     $     521,114     $     545,400   
Fully Taxable Equivalent ("FTE") Adjustment            5,788                5,883                5,859                5,795                5,853              23,326              23,943   
Net Interest Income (FTE) (non-GAAP) $     140,158     $     136,993     $     134,430     $     132,858     $     135,916     $     544,440     $     569,343   
              
Average Earning Assets (GAAP) $ 17,089,198     $ 16,990,358     $ 17,013,984     $ 17,123,851     $ 17,222,714     $ 17,054,267     $ 16,991,787   
Net Interest Margin (GAAP) 3.15 %  3.09 %  3.02 %  2.97 %  3.02 %  3.06 %  3.21 %
Net Interest Margin (FTE) (non-GAAP) 3.28 %  3.23 %  3.16 %  3.10 %  3.16 %  3.19 %  3.35 %

 

RETURN ON TANGIBLE COMMON EQUITY - NON-GAAP
(Dollars In Thousands) Three Months Ended  Twelve Months Ended
 December 31,  September 30,  June 30,  March 31,  December 31,  December 31,  December 31,
 2024  2024  2024  2024  2023  2024  2023
Total Average Stockholders' Equity (GAAP) $   2,312,270     $   2,251,547     $   2,203,361     $   2,242,139     $   2,130,993     $  2,252,491     $  2,127,262   
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       (728,218)          (729,581)          (730,980)          (732,432)          (734,007)         (730,295)         (736,601)  
Average Tangible Common Equity, Net of Tax (Non-GAAP) $   1,558,927     $   1,496,841     $   1,447,256     $   1,484,582     $   1,371,861     $  1,497,071     $  1,365,536   
              
Net Income Available to Common Stockholders (GAAP) $       63,880     $       48,719     $       39,456     $       47,472     $       42,010     $     199,527     $     221,911   
Plus: Intangible Asset Amortization, Net of Tax            1,399                1,399                1,399                1,546                1,724               5,744               6,906   
Tangible Net Income (Non-GAAP) $       65,279     $       50,118     $       40,855     $       49,018     $       43,734     $     205,271     $     228,817   
              
Return on Tangible Common Equity (Non-GAAP) 16.75 %  13.39 %  11.29 %  13.21 %  12.75 %  13.71 %  16.76 %


EFFICIENCY RATIO - NON-GAAP              
(Dollars In Thousands) Three Months Ended  Twelve Months Ended
 December 31,  September 30,  June 30,  March 31,  December 31,  December 31,  December 31,
 2024  2024  2024  2024  2023  2024  2023
Non Interest Expense (GAAP) $       96,289     $       94,629     $       91,413     $       96,935     $     108,103     $     379,266     $     388,270   
Less:  Intangible Asset Amortization          (1,771)             (1,772)             (1,771)             (1,957)             (2,182)             (7,271)             (8,743)  
Less:  OREO and Foreclosure Expenses             (227)                (942)                (373)                (534)             (1,743)             (2,076)             (3,318)  
Adjusted Non Interest Expense (Non-GAAP) $       94,291     $       91,915     $       89,269     $       94,444     $     104,178     $     369,919     $     376,209   
              
Net Interest Income (GAAP) $     134,370     $     131,110     $     128,571     $     127,063     $     130,063     $     521,114     $     545,400   
Plus:  Fully Taxable Equivalent Adjustment            5,788                5,883                5,859                5,795                5,853              23,326              23,943   
Net Interest Income on a Fully Taxable Equivalent Basis (Non-GAAP) $     140,158     $     136,993     $     134,430     $     132,858     $     135,916     $     544,440     $     569,343   
              
Non Interest Income (GAAP) $       42,742     $       24,866     $       31,334     $       26,638     $       26,444     $     125,580     $     105,602   
Less:  Investment Securities (Gains) Losses          11,592                9,114                    49                      2                2,317              20,757                6,930   
Adjusted Non Interest Income (Non-GAAP) $       54,334     $       33,980     $       31,383     $       26,640     $       28,761     $     146,337     $     112,532   
Adjusted Revenue (Non-GAAP) $     194,492     $     170,973     $     165,813     $     159,498     $     164,677     $     690,777     $     681,875   
Efficiency Ratio (Non-GAAP) 48.48 %  53.76 %  53.84 %  59.21 %  63.26 %  53.55 %  55.17 %
              
Adjusted Non Interest Expense (Non-GAAP) $       94,291     $       91,915     $       89,269     $       94,444     $     104,178     $     369,919     $     376,209   
Less:  Acquisition-related Expenses                —                    —                    —                    —                    —                    —                    —   
Less:  Non-core Expenses1,2,3             (762)                   —                    —              (3,481)           (12,682)             (4,243)           (12,682)  
Adjusted Non Interest Expense Excluding Non-core Expenses (Non-GAAP) $       93,529     $       91,915     $       89,269     $       90,963     $       91,496     $     365,676     $     363,527   
              
Adjusted Revenue (Non-GAAP) $     194,492     $     170,973     $     165,813     $     159,498     $     164,677     $     690,777     $     681,875   
Less:  Gain on Branch Sale        (19,983)                   —                    —                    —                    —            (19,983)                   —   
Adjusted Revenue Excluding Gain on Branch Sale (Non-GAAP) $     174,509     $     170,973     $     165,813     $     159,498     $     164,677     $     670,794     $     681,875   
Adjusted Efficiency Ratio (Non-GAAP) 53.60 %  53.76 %  53.84 %  57.03 %  55.56 %  54.51 %  53.31 %

1 - Non-core expenses in 4Q24 included $0.8 million of costs directly related to the branch sale.

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.

3 - 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.

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