SEC Filing | First Merchants Corporation

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frme-20220127

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

DATE OF REPORT (Date of earliest event reported): January 27, 2022

Commission File Number 0-17071

FIRST MERCHANTS CORPORATION

(Exact name of registrant as specified in its charter)


Indiana			35-1544218
(State or other jurisdiction of incorporation)			(IRS Employer Identification No.)

200 East Jackson Street

P.O. Box 792

Muncie, IN 47305-2814

(Address of principal executive offices, including zip code)

(765) 747-1500

(Registrant's telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)


Title of Each Class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.125 stated value per share	FRME	Nasdaq Global Select Market

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

On January 27 2022, First Merchants Corporation issued a press release to report its financial results for the fourth quarter ended December 31, 2021. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

The information in this Current Report on Form 8-K, including Exhibit No. 99.1 hereto, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to liability of that section. The information in this Current Report shall not be incorporated by reference into any filing or other document pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing or document.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.

(a) Not applicable.

(b) Not applicable.

(d) Exhibits.

Exhibit 99.1 Press Release, dated January 27 , 202 2 , issued by First Merchants Corporation

Exhibit 104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


									First Merchants Corporation
									(Registrant)

									By: /s/ Michele M. Kawiecki Michele M. Kawiecki Executive Vice President, Chief Financial Officer (Principal Financial and Accounting Officer)
Dated: January 27, 2022

EXHIBIT INDEX

Exhibit No. Description

99.1 Press Release, dated January 2 7 , 202 2 , issued by First Merchants Corporation

104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

Document

N / E / W / S R / E / L / E / A / S / E

January 27, 2022

FOR IMMEDIATE RELEASE

For more information, contact:

Nicole M. Weaver, Vice President and Director of Corporate Administration

765-521-7619

http://www.firstmerchants.com

SOURCE: First Merchants Corporation, Muncie, Indiana

FIRST MERCHANTS CORPORATION ANNOUNCES 2021 RECORD RESULTS

First Merchants Corporation (NASDAQ - FRME) has reported fourth quarter 2021 net income of $47.7 million compared to $45.1 million during the same period in 2020. Earnings per share for the period totaled $.89 per share compared to the fourth quarter 2020 result of $.83 per share. Net income for the year ended December 31, 2021 totaled $205.5 million, compared to $148.6 million during the same period in 2020. Year-to-date earnings per share totaled $3.81 compared to $2.74 in 2020.

Total assets equaled $15.5 billion as of year-end and loans totaled $9.3 billion. The Corporation experienced organic loan growth of $566 million, or 6.6 percent, during 2021. This was offset by the forgiveness of Paycheck Protection Program (“PPP”) loans of $560 million, resulting in net loan growth of $6 million. Investments increased $1.4 billion, or 43.8 percent, during the year and now total $4.5 billion. Total deposits equaled $12.7 billion as of year-end and increased by $1.4 billion, or 12.1 percent, during 2021.

The Corporation’s Allowance for Credit Losses – Loans (ACL) totaled $195.4 million as of year-end, or 2.11 percent of total loans. Net charge-offs for the quarter totaled $4.6 million and no provision expense was recorded during the quarter or during the year ended 2021. Provision expense taken during the three and twelve months ended December 31, 2020 of $4.5 million and $58.7 million, respectively, reflected our view of increased credit risk in 2020 related to the COVID-19 pandemic. An increase of $74.1 million in the ACL was also recorded on January 1, 2021 reflecting the adoption of the current expected credit losses (CECL) model. Non-accrual loans totaled $43.1 million as of year-end.

Mark Hardwick, Chief Executive Officer, stated, “2021 proved to be a record year on many levels, including total assets, loans, deposits, net income and earnings per share. Our employees, customers and communities showed an incredible amount of toughness, determination, teamwork and compassion for one another during a difficult year. First Merchants’ future is bright because of this special combination of heart and grit.” Hardwick also added, “It’s an honor to lead this First Merchants team and to be part of the dynamic markets that we serve.”

Net-interest income totaled $410.7 million for the year, an increase of $28.6 million or 7.5 percent, in the face of a net-interest margin decline of 11 basis points to 3.18 percent, reflecting an asset sensitive balance sheet. Yield on earning assets declined by 40 basis points totaling 3.44 percent offset by a decline of 29 basis points in the cost of supporting liabilities, which totaled 26 basis points for the year-ended 2021. Yield on earning assets for the fourth quarter totaled 3.29 percent with cost of supporting liabilities totaling 25 basis points, resulting in a margin of 3.04 percent. PPP loans contributed 8 basis points to margin during the fourth quarter of 2021, which was a decline of 9 basis points from the third quarter 2021 and a decline of 8 basis points from the fourth quarter of 2020, as the pace of PPP loan forgiveness slowed.

Non-interest income totaled $109.3 million for the year, a $0.6 million decline from 2020. Customer-related line items accounted for an increase of $2.6 million, or 3 percent, and was offset by a decline of $6.2 million on the gains on sales of securities. Fiduciary and wealth management fees hit a record high of $28.4 million for 2021, which included an increase of $1 million from the acquisition of Hoosier Trust Company. This was offset by the headwinds of the full year impact of the Durbin Amendment adoption on card payment fees which was effective July of 2020.

Non-interest expense totaled $279.2 million for the year ended 2021, a $15.8 million increase from 2020. The increase is primarily due to higher salaries, incentives, and employee benefits costs.

The Corporation’s loan to deposit ratio now totals 73 percent and loan to asset ratio totals 60 percent. Additionally, the Corporation’s total risk-based capital ratio equaled 13.92 percent, common equity tier 1 capital ratio equaled 11.68 percent, and the tangible common equity ratio totaled 9.01 percent. These ratios continue to reflect the Corporation’s strong liquidity and capital positions.

CONFERENCE CALL

First Merchants Corporation will conduct a fourth quarter earnings conference call and web cast at 2:30 p.m. (ET) on Thursday, January 27, 2022.

To participate, dial (Toll Free) 877-806-2932 and reference Conference ID 2169777. International callers please call +1 478-219-0639.

In order to view the webcast and presentation slides, please go to https://edge.media-server.com/mmc/p/i8985qq2 during the time of the call. A replay of the webcast will be available until January 27, 2023.

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, 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,
	2021		2020
ASSETS
Cash and cash equivalents	$	167,146	$	192,896
Interest-bearing deposits	474,154		392,305
Investment securities, net of allowance for credit losses of $245,000 and $0	4,524,353		3,146,787
Loans held for sale	11,187		3,966
Loans	9,241,861		9,243,174
Less: Allowance for credit losses - loans	(195,397)		(130,648)
Net loans	9,046,464		9,112,526
Premises and equipment	105,655		111,062
Federal Home Loan Bank stock	28,736		28,736
Interest receivable	57,187		53,948
Goodwill and other intangibles	570,860		572,893
Cash surrender value of life insurance	291,041		292,745
Other real estate owned	558		940
Tax asset, deferred and receivable	35,641		12,340
Other assets	140,167		146,066
TOTAL ASSETS	$	15,453,149	$	14,067,210
LIABILITIES
Deposits:
Noninterest-bearing	$	2,709,646	$	2,298,138
Interest-bearing	10,022,931		9,063,472
Total Deposits	12,732,577		11,361,610
Borrowings:

Securities sold under repurchase agreements	181,577		177,102
Federal Home Loan Bank advances	334,055		389,430
Subordinated debentures and other borrowings	118,618		118,380
Total Borrowings	634,250		684,912
Interest payable	2,762		3,287
Other liabilities	170,989		141,756
Total Liabilities	13,540,578		12,191,565
STOCKHOLDERS' EQUITY
Cumulative Preferred Stock, $1,000 par value, $1,000 liquidation value:
Authorized -- 600 shares
Issued and outstanding - 125 shares	125		125
Common Stock, $.125 stated value:
Authorized -- 100,000,000 shares
Issued and outstanding - 53,410,411 and 53,922,359 shares	6,676		6,740
Additional paid-in capital	985,818		1,005,366
Retained earnings	864,839		788,578
Accumulated other comprehensive income	55,113		74,836
Total Stockholders' Equity	1,912,571		1,875,645
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	15,453,149	$	14,067,210


CONSOLIDATED STATEMENTS OF INCOME	Three Months Ended				Twelve Months Ended
(Dollars In Thousands, Except Per Share Amounts)	December 31,				December 31,
	2021		2020		2021		2020
INTEREST INCOME
Loans receivable:
Taxable	$	80,583	$	90,138	$	338,009	$	358,264
Tax-exempt	5,635		5,414		22,110		21,483
Investment securities:
Taxable	8,028		5,263		29,951		24,440
Tax-exempt	15,411		12,056		55,331		42,341

Deposits with financial institutions	173		139		634		938
Federal Home Loan Bank stock	163		214		597		1,042
Total Interest Income	109,993		113,224		446,632		448,508
INTEREST EXPENSE
Deposits	5,589		7,509		23,319		51,740
Federal funds purchased	1		2		5		120
Securities sold under repurchase agreements	75		77		314		604
Federal Home Loan Bank advances	1,389		1,656		5,672		6,973
Subordinated debentures and other borrowings	1,666		1,669		6,642		6,944
Total Interest Expense	8,720		10,913		35,952		66,381
NET INTEREST INCOME	101,273		102,311		410,680		382,127
Provision for credit losses - loans	—		4,482		—		58,673
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES	101,273		97,829		410,680		323,454
OTHER INCOME
Service charges on deposit accounts	6,462		5,508		23,571		20,999
Fiduciary and wealth management fees	7,078		6,251		28,362		23,747
Card payment fees	3,937		3,502		16,619		19,502
Net gains and fees on sales of loans	3,423		5,393		19,689		18,271
Derivative hedge fees	1,562		2,281		3,850		6,977
Other customer fees	361		394		1,490		1,497
Earnings on cash surrender value of life insurance	2,051		1,283		7,060		5,140
Net realized gains on sales of available for sale securities	358		2,398		5,674		11,895
Other income	615		473		3,008		1,898
Total Other Income	25,847		27,483		109,323		109,926
OTHER EXPENSES
Salaries and employee benefits	42,432		41,809		166,995		155,937
Net occupancy	5,644		9,653		23,326		26,756
Equipment	4,994		5,555		19,401		19,344
Marketing	1,840		1,763		5,762		6,609
Outside data processing fees	4,581		3,839		18,317		14,432
Printing and office supplies	356		307		1,217		1,304
Intangible asset amortization	1,463		1,476		5,747		5,987
FDIC assessments	1,862		1,560		6,243		5,804
Other real estate owned and foreclosure expenses	171		(1,576)		992		330
Professional and other outside services	3,627		2,836		11,913		8,901
Other expenses	5,466		5,314		19,300		18,001
Total Other Expenses	72,436		72,536		279,213		263,405
INCOME BEFORE INCOME TAX	54,684		52,776		240,790		169,975
Income tax expense	6,951		7,641		35,259		21,375
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS	$	47,733	$	45,135	$	205,531	$	148,600


Per Share Data:
Basic Net Income Available to Common Stockholders	$	0.89	$	0.83	$	3.82	$	2.75
Diluted Net Income Available to Common Stockholders	$	0.89	$	0.83	$	3.81	$	2.74
Cash Dividends Paid	$	0.29	$	0.26	$	1.13	$	1.04
Average Diluted Shares Outstanding (in thousands)	53,660		54,050		53,984		54,220


FINANCIAL HIGHLIGHTS
(Dollars in thousands)	Three Months Ended						Twelve Months Ended
	December 31,						December 31,
	2021			2020			2021			2020
NET CHARGE-OFFS	$	4,575		$	560		$	9,306		$	8,309

AVERAGE BALANCES:
Total Assets	$	15,298,655		$	13,968,047		$	14,830,397		$	13,466,269
Total Loans	9,076,652			9,240,304			9,170,650			9,051,155
Total Earning Assets	14,053,310			12,663,803			13,579,113			12,123,317
Total Deposits	12,647,737			11,283,040			12,176,231			10,728,106
Total Stockholders' Equity	1,890,229			1,856,896			1,866,632			1,825,135

FINANCIAL RATIOS:
Return on Average Assets	1.25		%	1.29		%	1.39		%	1.10		%
Return on Average Stockholders' Equity	10.10			9.72			11.01			8.14
Return on Average Common Stockholders' Equity	10.10			9.72			11.01			8.14
Average Earning Assets to Average Assets	91.86			90.66			91.56			90.03
Allowance for Credit Losses - Loans as % of Total Loans	2.11			1.41			2.11			1.41
Net Charge-offs as % of Average Loans (Annualized)	0.20			0.02			0.10			0.09
Average Stockholders' Equity to Average Assets	12.36			13.29			12.59			13.55
Tax Equivalent Yield on Average Earning Assets	3.29			3.72			3.44			3.84
Interest Expense/Average Earning Assets	0.25			0.34			0.26			0.55
Net Interest Margin (FTE) on Average Earning Assets	3.04			3.38			3.18			3.29
Efficiency Ratio	53.49			55.01			50.94			51.71
Tangible Common Book Value Per Share	$	25.21		$	24.27		$	25.21		$	24.27


NON-PERFORMING ASSETS
(Dollars In Thousands)	December 31,			September 30,			June 30,			March 31,			December 31,
	2021			2021			2021			2021			2020
Non-Accrual Loans	$	43,062		$	51,502		$	57,556		$	57,923		$	61,471
Renegotiated Loans	329			439			629			655			3,240
Non-Performing Loans (NPL)	43,391			51,941			58,185			58,578			64,711
Other Real Estate Owned and Repossessions	558			698			601			604			940
Non-Performing Assets (NPA)	43,949			52,639			58,786			59,182			65,651
90+ Days Delinquent	963			157			183			1,093			746
NPAs & 90 Day Delinquent	$	44,912		$	52,796		$	58,969		$	60,275		$	66,397

Allowance for Credit Losses - Loans	$	195,397		$	199,972		$	199,775		$	201,082		$	130,648
Quarterly Net Charge-offs	4,575			(197)			1,307			3,621			560
NPAs / Actual Assets %	0.28		%	0.35		%	0.39		%	0.40		%	0.47		%
NPAs & 90 Day / Actual Assets %	0.29		%	0.35		%	0.40		%	0.41		%	0.47		%
NPAs / Actual Loans and OREO %	0.47		%	0.58		%	0.64		%	0.63		%	0.71		%
Allowance for Credit Losses - Loans / Actual Loans (%)	2.11		%	2.21		%	2.19		%	2.16		%	1.41		%
Net Charge-offs as % of Average Loans (Annualized)	0.20		%	(0.01)		%	0.06		%	0.16		%	0.02		%


CONSOLIDATED BALANCE SHEETS
(Dollars In Thousands)	December 31,		September 30,		June 30,		March 31,		December 31,
	2021		2021		2021		2021		2020
ASSETS
Cash and cash equivalents	$	167,146	$	169,261	$	167,596	$	187,901	$	192,896
Interest-bearing deposits	474,154		369,447		438,863		392,806		392,305
Investment securities, net of allowance for credit losses	4,524,353		4,445,516		4,148,314		3,700,857		3,146,787
Loans held for sale	11,187		5,990		18,582		4,430		3,966
Loans	9,241,861		9,041,576		9,121,250		9,318,228		9,243,174
Less: Allowance for credit losses - loans	(195,397)		(199,972)		(199,775)		(201,082)		(130,648)
Net loans	9,046,464		8,841,604		8,921,475		9,117,146		9,112,526
Premises and equipment	105,655		104,814		103,822		109,432		111,062
Federal Home Loan Bank stock	28,736		28,736		28,736		28,736		28,736
Interest receivable	57,187		53,079		54,173		54,662		53,948
Goodwill and other intangibles	570,860		572,323		573,786		571,536		572,893
Cash surrender value of life insurance	291,041		291,825		294,462		293,766		292,745
Other real estate owned	558		698		601		604		940
Tax asset, deferred and receivable	35,641		39,504		36,924		40,163		12,340
Other assets	140,167		137,928		135,763		127,027		146,066
TOTAL ASSETS	$	15,453,149	$	15,060,725	$	14,923,097	$	14,629,066	$	14,067,210
LIABILITIES
Deposits:
Noninterest-bearing	$	2,709,646	$	2,554,323	$	2,479,853	$	2,494,891	$	2,298,138
Interest-bearing	10,022,931		9,794,366		9,723,547		9,456,889		9,063,472
Total Deposits	12,732,577		12,348,689		12,203,400		11,951,780		11,361,610
Borrowings:

Securities sold under repurchase agreements	181,577		183,589		146,904		185,721		177,102
Federal Home Loan Bank advances	334,055		334,149		334,243		359,337		389,430
Subordinated debentures and other borrowings	118,618		118,558		118,498		118,439		118,380
Total Borrowings	634,250		636,296		599,645		663,497		684,912
Interest payable	2,762		3,736		2,929		4,020		3,287
Other liabilities	170,989		203,914		245,323		203,913		141,756
Total Liabilities	13,540,578		13,192,635		13,051,297		12,823,210		12,191,565
STOCKHOLDERS' EQUITY
Cumulative Preferred Stock, $1,000 par value, $1,000 liquidation value:
Authorized -- 600 shares
Issued and outstanding	125		125		125		125		125
Common Stock, $.125 stated value:
Authorized -- 100,000,000 shares
Issued and outstanding	6,676		6,689		6,747		6,744		6,740
Additional paid-in capital	985,818		988,659		1,009,182		1,007,300		1,005,366
Retained earnings	864,839		832,728		795,666		755,877		788,578
Accumulated other comprehensive income	55,113		39,889		60,080		35,810		74,836
Total Stockholders' Equity	1,912,571		1,868,090		1,871,800		1,805,856		1,875,645
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	15,453,149	$	15,060,725	$	14,923,097	$	14,629,066	$	14,067,210


CONSOLIDATED STATEMENTS OF INCOME
(Dollars In Thousands, Except Per Share Amounts)	December 31,			September 30,			June 30,			March 31,			December 31,
	2021			2021			2021			2021			2020
INTEREST INCOME
Loans receivable:
Taxable	$	80,583		$	85,319		$	87,002		$	85,105		$	90,138
Tax-exempt	5,635			5,591			5,545			5,339			5,414
Investment securities:
Taxable	8,028			7,788			7,440			6,695			5,263
Tax-exempt	15,411			14,464			13,071			12,385			12,056

Deposits with financial institutions	173			218			129			114			139
Federal Home Loan Bank stock	163			168			88			178			214
Total Interest Income	109,993			113,548			113,275			109,816			113,224
INTEREST EXPENSE
Deposits	5,589			5,707			5,823			6,200			7,509
Federal funds purchased	1			—			2			2			2
Securities sold under repurchase agreements	75			77			75			87			77
Federal Home Loan Bank advances	1,389			1,389			1,452			1,442			1,656
Subordinated debentures and other borrowings	1,666			1,660			1,659			1,657			1,669
Total Interest Expense	8,720			8,833			9,011			9,388			10,913
NET INTEREST INCOME	101,273			104,715			104,264			100,428			102,311
Provision for credit losses - loans	—			—			—			—			4,482
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES	101,273			104,715			104,264			100,428			97,829
OTHER INCOME
Service charges on deposit accounts	6,462			6,249			5,596			5,264			5,508
Fiduciary and wealth management fees	7,078			7,352			7,510			6,422			6,251
Card payment fees	3,937			4,156			4,159			4,367			3,502
Net gains and fees on sales of loans	3,423			3,955			8,325			3,986			5,393
Derivative hedge fees	1,562			1,028			943			317			2,281
Other customer fees	361			393			368			368			394
Earnings on cash surrender value of life insurance	2,051			2,468			1,205			1,336			1,283
Net realized gains on sales of available for sale securities	358			1,756			1,761			1,799			2,398
Other income	615			1,144			1,017			232			473
Total Other Income	25,847			28,501			30,884			24,091			27,483
OTHER EXPENSES
Salaries and employee benefits	42,432			43,314			42,438			38,811			41,809
Net occupancy	5,644			5,576			5,615			6,491			9,653
Equipment	4,994			4,529			4,848			5,030			5,555
Marketing	1,840			1,676			1,122			1,124			1,763
Outside data processing fees	4,581			4,794			4,698			4,244			3,839
Printing and office supplies	356			265			313			283			307
Intangible asset amortization	1,463			1,463			1,464			1,357			1,476
FDIC assessments	1,862			1,552			1,461			1,368			1,560
Other real estate owned and foreclosure expenses	171			(91)			178			734			(1,576)
Professional and other outside services	3,627			2,767			2,976			2,543			2,836
Other expenses	5,466			5,539			4,182			4,113			5,314
Total Other Expenses	72,436			71,384			69,295			66,098			72,536
INCOME BEFORE INCOME TAX	54,684			61,832			65,853			58,421			52,776
Income tax expense	6,951			9,062			10,294			8,952			7,641
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS	$	47,733		$	52,770		$	55,559		$	49,469		$	45,135

Per Share Data:
Basic Net Income Available to Common Stockholders	$	0.89		$	0.98		$	1.03		$	0.92		$	0.83
Diluted Net Income Available to Common Stockholders	$	0.89		$	0.98		$	1.03		$	0.91		$	0.83
Cash Dividends Paid	$	0.29		$	0.29		$	0.29		$	0.26		$	0.26
Average Diluted Shares Outstanding (in thousands)	53,660			53,960			54,184			54,134			54,050
FINANCIAL RATIOS:
Return on Average Assets	1.25		%	1.41		%	1.51		%	1.39		%	1.29		%
Return on Average Stockholders' Equity	10.10			11.17			12.04			10.75			9.72
Return on Average Common Stockholders' Equity	10.10			11.17			12.04			10.75			9.72
Average Earning Assets to Average Assets	91.86			91.57			91.87			91.43			90.66
Allowance for Credit Losses - Loans as % of Total Loans	2.11			2.21			2.19			2.16			1.41
Net Charge-offs as % of Average Loans (Annualized)	0.20			(0.01)			0.06			0.16			0.02
Average Stockholders' Equity to Average Assets	12.36			12.59			12.51			12.92			13.29
Tax Equivalent Yield on Average Earning Assets	3.29			3.46			3.49			3.52			3.72
Interest Expense/Average Earning Assets	0.25			0.26			0.27			0.29			0.34
Net Interest Margin (FTE) on Average Earning Assets	3.04			3.20			3.22			3.23			3.38
Efficiency Ratio	53.49			51.18			48.91			50.23			55.01
Tangible Common Book Value Per Share	$	25.21		$	24.31		$	24.15		$	22.98		$	24.27


LOANS
(Dollars In Thousands)	December 31,		September 30,		June 30,		March 31,		December 31,
	2021		2021		2021		2021		2020
Commercial and industrial loans	$	2,714,565	$	2,573,615	$	2,671,076	$	2,876,212	$	2,776,699
Agricultural land, production and other loans to farmers	246,442		240,686		235,020		245,631		281,884
Real estate loans:
Construction	523,066		521,889		491,200		541,224		484,723
Commercial real estate, non-owner occupied	2,135,459		2,150,387		2,263,497		2,178,832		2,220,949
Commercial real estate, owner occupied	986,720		952,441		953,501		950,038		958,501
Residential	1,159,127		1,154,373		1,127,442		1,239,925		1,234,741
Home equity	523,754		531,307		489,997		482,229		508,259
Individuals' loans for household and other personal expenditures	146,092		135,093		130,819		126,387		129,479
Public finance and other commercial loans	806,636		781,785		758,698		677,750		647,939
Loans	9,241,861		9,041,576		9,121,250		9,318,228		9,243,174
Allowance for credit losses - loans	(195,397)		(199,972)		(199,775)		(201,082)		(130,648)
NET LOANS	$	9,046,464	$	8,841,604	$	8,921,475	$	9,117,146	$	9,112,526


DEPOSITS
(Dollars In Thousands)	Deember 31,		September 30,		June 30,		March 31,		December 31,
	2021		2021		2021		2021		2020
Demand deposits	$	7,704,190	$	7,317,399	$	7,261,603	$	7,245,850	$	6,821,152
Savings deposits	4,334,802		4,301,483		4,157,552		3,857,624		3,661,713
Certificates and other time deposits of $100,000 or more	273,379		283,396		304,394		332,745		346,194
Other certificates and time deposits	389,752		404,010		423,922		449,655		459,168
Brokered deposits	30,454		42,401		55,929		65,906		73,383
TOTAL DEPOSITS	$	12,732,577	$	12,348,689	$	12,203,400	$	11,951,780	$	11,361,610


CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST MARGIN ANALYSIS
(Dollars in Thousands)
	For the Three Months Ended
	December 31, 2021						December 31, 2020
	Average Balance		Interest Income / Expense		Average Rate		Average Balance		Interest Income / Expense		Average Rate
Assets:

Interest-bearing deposits	$	558,677	$	173	0.12	%	$	437,766	$	139	0.13	%
Federal Home Loan Bank stock	28,736		163		2.27		28,736		214		2.98
Investment Securities: (1)
Taxable	1,936,519		8,028		1.66		1,222,916		5,263		1.72
Tax-Exempt (2)	2,452,726		19,508		3.18		1,734,081		15,261		3.52
Total Investment Securities	4,389,245		27,536		2.51		2,956,997		20,524		2.78
Loans held for sale	20,688		196		3.79		19,103		200		4.19
Loans: (3)
Commercial	6,703,241		65,867		3.93		6,925,491		73,530		4.25
Real Estate Mortgage	889,571		7,866		3.54		911,042		9,482		4.16
Installment	711,309		6,654		3.74		698,619		6,925		3.96
Tax-Exempt (2)	751,843		7,133		3.79		686,049		6,854		4.00
Total Loans	9,076,652		87,716		3.87		9,240,304		96,991		4.20
Total Earning Assets	14,053,310		115,588		3.29	%	12,663,803		117,868		3.72	%
Total Non-Earning Assets	1,245,345						1,304,244
Total Assets	$	15,298,655					$	13,968,047
Liabilities:
Interest-bearing deposits:
Interest-bearing deposits	$	4,912,556	$	3,637	0.30	%	$	4,393,991	$	3,888	0.35	%
Money market deposits	2,518,612		809		0.13		2,051,985		1,164		0.23
Savings deposits	1,828,631		461		0.10		1,613,886		634		0.16
Certificates and other time deposits	706,617		682		0.39		961,187		1,823		0.76
Total Interest-bearing Deposits	9,966,416		5,589		0.22		9,021,049		7,509		0.33
Borrowings	620,398		3,131		2.02		683,068		3,404		1.99
Total Interest-bearing Liabilities	10,586,814		8,720		0.33		9,704,117		10,913		0.45
Noninterest-bearing deposits	2,681,321						2,261,991
Other liabilities	140,291						145,043
Total Liabilities	13,408,426						12,111,151
Stockholders' Equity	1,890,229						1,856,896
Total Liabilities and Stockholders' Equity	$	15,298,655	8,720				$	13,968,047	10,913
Net Interest Income (FTE)			$	106,868					$	106,955
Net Interest Spread (FTE) (4)					2.96	%					3.27	%

Net Interest Margin (FTE):
Interest Income (FTE) / Average Earning Assets					3.29	%					3.72	%
Interest Expense / Average Earning Assets					0.25	%					0.34	%
Net Interest Margin (FTE) (5)					3.04	%					3.38	%

(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 2021 and 2020. These totals equal $5,595 and $4,644 for the three months ended December 31, 2021 and 2020, 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, 2021						December 31, 2020
	Average Balance		Interest Income / Expense		Average Rate		Average Balance		Interest Income / Expense		Average Rate
Assets:

Interest-bearing deposits	$	521,637	$	634	0.12	%	$	319,686	$	938	0.29	%
Federal Home Loan Bank stock	28,736		597		2.08		28,736		1,042		3.63
Investment Securities: (1)
Taxable	1,751,910		29,951		1.71		1,282,827		24,440		1.91
Tax-Exempt (2)	2,106,180		70,039		3.33		1,440,913		53,596		3.72
Total Investment Securities	3,858,090		99,990		2.59		2,723,740		78,036		2.87
Loans held for sale	19,190		747		3.89		18,559		781		4.21
Loans: (3)
Commercial	6,818,968		276,368		4.05		6,755,215		286,773		4.25
Real Estate Mortgage	916,314		34,783		3.80		889,083		40,002		4.50
Installment	683,925		26,111		3.82		718,815		30,708		4.27
Tax-Exempt (2)	732,253		27,987		3.82		669,483		27,194		4.06
Total Loans	9,170,650		365,996		3.99		9,051,155		385,458		4.26
Total Earning Assets	13,579,113		467,217		3.44	%	12,123,317		465,474		3.84	%
Total Non-Earning Assets	1,251,284						1,342,952
Total Assets	$	14,830,397					$	13,466,269
Liabilities:
Interest-bearing deposits:
Interest-bearing deposits	$	4,769,482	$	14,512	0.30	%	$	4,009,566	$	20,239	0.50	%
Money market deposits	2,351,803		3,203		0.14		1,769,478		7,810		0.44
Savings deposits	1,754,972		1,886		0.11		1,534,069		3,641		0.24
Certificates and other time deposits	783,733		3,718		0.47		1,346,967		20,050		1.49
Total Interest-bearing Deposits	9,659,990		23,319		0.24		8,660,080		51,740		0.60
Borrowings	639,791		12,633		1.97		768,238		14,641		1.91
Total Interest-bearing Liabilities	10,299,781		35,952		0.35		9,428,318		66,381		0.70
Noninterest-bearing deposits	2,516,241						2,068,026
Other liabilities	147,743						144,790
Total Liabilities	12,963,765						11,641,134
Stockholders' Equity	1,866,632						1,825,135
Total Liabilities and Stockholders' Equity	$	14,830,397	35,952				$	13,466,269	66,381
Net Interest Income (FTE)			$	431,265					$	399,093
Net Interest Spread (FTE) (4)					3.09	%					3.14	%

Net Interest Margin (FTE):
Interest Income (FTE) / Average Earning Assets					3.44	%					3.84	%
Interest Expense / Average Earning Assets					0.26	%					0.55	%
Net Interest Margin (FTE) (5)					3.18	%					3.29	%

(1) Average balance of securities is computed based on the average of the historical amortized cost balances without the effects of the fair value adjustments. Annualized amounts are computed using a 30/360 day basis.
(2) Tax-exempt securities and loans are presented on a fully taxable equivalent basis, using a marginal tax rate of 21 percent for 2021 and 2020. These totals equal $20,585 and $16,966 for the twelve months ended December 31, 2021 and 2020, 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.