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frme-20230725
0000712534false00007125342023-07-252023-07-250000712534us-gaap:CommonStockMember2023-07-252023-07-250000712534frme:DepositarySharesMember2023-07-252023-07-25


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): July 25, 2023

FIRST MERCHANTS CORPORATION
(Exact name of registrant as specified in its charter)
Indiana
(State or other jurisdiction of incorporation)
001-4134235-1544218
(Commission File Number)(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 ClassTrading Symbol(s)Name of each exchange on which registered
Common Stock, $0.125 stated value per shareFRMEThe Nasdaq Stock Market LLC
Depositary Shares, each representing a 1/100th interest in a share of Non-Cumulative Perpetual Preferred Stock, Series AFRMEPThe Nasdaq Stock Market LLC

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 July 25, 2023, First Merchants Corporation issued a press release to report its financial results for the second quarter ended June 30, 2023. 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.

(c)    Not applicable.

(d)    Exhibits.

Exhibit 99.1 Press Release, dated July 25, 2023, 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: July 25, 2023



EXHIBIT INDEX

Exhibit No.    Description


99.1            Press Release, dated July 25, 2023, 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
    
July 25, 2023

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 SECOND QUARTER 2023 EARNINGS PER SHARE

First Merchants Corporation (NASDAQ - FRME)

Second Quarter 2023 Highlights:

•    Net income available to common stockholders was $60.4 million and diluted earnings per common share totaled $1.02, compared to $38.5 million and $.63 in the second quarter of 2022, and $63.6 million and $1.07 in the first quarter of 2023.
•    Adjusted net income1 was $60.4 million and adjusted diluted earnings per share1 totaled $1.02, compared to $60.0 million and $1.01 in the second quarter of 2022, and $63.6 million and $1.07 in the first quarter of 2023.
•    Strong capital position with Common Equity Tier 1 Capital Ratio of 11.07 percent
•    Total loans grew $46.7 million, or 1.5 percent annualized on a linked quarter basis, and $163.2 million, or 5.4 percent annualized when excluding non-relationship based commercial loan sales that occurred during the quarter of $116.6 million.
•    Total deposits declined $122.1 million, or 3.3 percent annualized on a linked quarter basis
•    Nonaccrual loans totaled $69.2 million compared to $46.6 million on a linked quarter basis
•    The efficiency ratio totaled 52.21 percent for the quarter

Mark Hardwick, Chief Executive Officer, stated, “We are pleased to report our second quarter 2023 results. Performance remains healthy and strong and our teams continue to meet the demands of our communities and client base.”

Second Quarter Financial Results:

First Merchants Corporation (the “Corporation) has reported second quarter 2023 net income available to common stockholders of $60.4 million compared to $38.5 million during the same period in 2022. Diluted earnings per common share for the period totaled $1.02 per share compared to the second quarter of 2022 result of $.63 per share. Prior year results included acquisition costs related to the acquisition of Level One of $29.3 million resulting in a reduction of $.38 of diluted earnings per common share.

Total assets equaled $18.0 billion as of quarter-end and loans totaled $12.3 billion. During the past twelve months, total loans grew by $1.0 billion, or 9.2 percent and were offset by the non-relationship based commercial loan sale of $116.6 million and PPP loan forgiveness of $29.6 million. On a linked quarter basis, loans grew $163.2 million, or 5.4 percent, when excluding the loan sale that occurred during the quarter of $116.6 million.

Investments, totaling $3.9 billion, decreased $738.5 million, or 16.0 percent, during the last twelve months and decreased $165.9 million, or 16.4 percent annualized on a linked quarter basis. The decline during the quarter was primarily due to $101.0 million of bond sales.

Total deposits equaled $14.6 billion as of quarter-end and increased by $10.3 million over the past twelve months. Total deposits declined $122.1 million, or 3.3 percent annualized on a linked quarter basis. The loan to deposit ratio for the current quarter ended at 84.3 percent.





The Corporation’s Allowance for Credit Losses – Loans (ACL) totaled $221.1 million as of quarter-end, or 1.80 percent of total loans, a decrease of $5.1 million from prior year. Loan charge-offs, net of recoveries, for the quarter totaled $1.9 million. No provision expense was recorded during the quarter or during the last twelve months. Non-performing assets to total assets were 0.43 percent for the second quarter of 2023, an increase of 13 basis points compared to 0.30 percent in the second quarter of 2022.

Net-interest income, totaling $137.8 million for the quarter, declined $6.3 million, or 4.4 percent, compared to prior quarter and increased $9.2 million, or 7.1 percent compared to the second quarter of 2022. Stated net-interest margin on a tax equivalent basis, totaling 3.39 percent, declined by 19 basis points compared to the first quarter of 2023 but increased 11 basis points compared to the second quarter of 2022. Net-interest margin, excluding the impact of fair value accretion and PPP loans, totaled 3.34 percent, a decrease of 18 basis points compared to 3.52 percent for the first quarter of 2023 but an increase of 15 basis points from the second quarter of 2022. During the quarter, increased deposit costs and mix offset the increase in earning asset yields reducing net-interest margin.

Non-interest income, totaling $26.3 million for the quarter, increased $1.3 million or 5.3 percent compared to the first quarter of 2023 but decreased $2.0 million from the second quarter of 2022. The increase over first quarter of 2023 was driven primarily by higher gains on the sales of loans and BOLI death benefit gains.

Non-interest expense totaled $92.6 million for the quarter, a decline of $1.1 million from the first quarter of 2023. The decrease was from lower salaries and employee benefits, partially offset by increases in FDIC assessments and other real estate owned and foreclosure expense.

The Corporation’s total risk-based capital ratio equaled 13.48 percent, common equity tier 1 capital ratio equaled 11.07 percent, and the tangible common equity ratio totaled 7.99 percent. 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 second quarter earnings conference call and web cast at 11:30 a.m. (ET) on Tuesday, July 25, 2023.

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/BIc7becea7282048a2b5559e10b25ca4af)

In order to view the webcast and presentation slides, please go to (https://edge.media-server.com/mmc/p/athyqu7i) during the time of the call. A replay of the webcast will be available until July 25, 2024.

Detailed financial results are reported on the attached pages.

About First Merchants Corporation

First Merchants Corporation is a financial holding company headquartered in Muncie, Indiana. The Corporation has one full-service bank charter, First Merchants Bank. The Bank also operates as First Merchants Private Wealth Advisors (as a division of First Merchants Bank).

First Merchants Corporation’s common stock is traded on the NASDAQ Global Select Market System under the symbol FRME. Quotations are carried in daily newspapers and can be found on the company’s Internet web page (http://www.firstmerchants.com).

FIRST MERCHANTS and the Shield Logo are federally registered trademarks of First Merchants Corporation.

Forward-Looking Statements

This release contains forward-looking statements made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements can often, but not always, be identified by the use of words like “believe”, “continue”, “pattern”, “estimate”, “project”, “intend”, “anticipate”, “expect” and similar expressions or future or conditional verbs such as “will”, “would”, “should”, “could”, “might”, “can”, “may”, or similar expressions. These statements include statements of First Merchants’ goals, intentions and expectations; statements regarding the First Merchants’ business plan and growth strategies; statements regarding the asset quality of First Merchants’ loan and investment portfolios; and estimates of First Merchants’ risks and future costs and benefits. These forward-looking statements are subject to significant risks, assumptions and uncertainties that may cause results to differ materially from those set forth in forward-looking statements, including, among other things: possible changes in monetary and fiscal policies, and laws and regulations; the effects of easing restrictions on participants in the financial services industry; the cost and other effects of legal and administrative cases; possible changes in the credit worthiness of customers and the possible impairment of collectability of loans; fluctuations in market rates of interest; competitive factors in the banking industry; changes in the banking legislation or regulatory requirements of federal and state agencies applicable to bank holding companies and banks like First Merchants’ affiliate bank; continued availability of earnings and excess capital sufficient for the lawful and prudent declaration of dividends; changes in market, economic, operational, liquidity (including the ability to grow and maintain core deposits and retain large, uninsured deposits), credit and interest rate risks associated with the First Merchants’ business; and other risks and factors identified in each of First Merchants’ filings with the Securities and Exchange Commission. First Merchants does not undertake any obligation to update any forward-looking statement, whether written or oral, relating to the matters discussed in this press release. In addition, First Merchants’ past results of operations do not necessarily indicate its anticipated future results.
* * * *




CONSOLIDATED BALANCE SHEETS
(Dollars In Thousands)June 30,
20232022
ASSETS
Cash and due from banks$108,975 $212,559 
Interest-bearing deposits219,480 136,702 
Investment securities, net of allowance for credit losses of $245,000 and $245,0003,891,491 4,630,030 
Loans held for sale27,297 9,060 
Loans12,270,233 11,397,417 
Less: Allowance for credit losses - loans(221,147)(226,275)
Net loans12,049,086 11,171,142 
Premises and equipment114,402 117,757 
Federal Home Loan Bank stock41,842 38,111 
Interest receivable89,784 68,728 
Goodwill and other intangibles743,465 753,649 
Cash surrender value of life insurance307,020 323,013 
Other real estate owned7,685 6,521 
Tax asset, deferred and receivable113,724 114,965 
Other assets254,161 198,255 
TOTAL ASSETS$17,968,412 $17,780,492 
LIABILITIES
Deposits:
Noninterest-bearing$2,636,017 $3,435,331 
Interest-bearing11,945,138 11,135,538 
Total Deposits14,581,155 14,570,869 
Borrowings:
Federal funds purchased— 100,000 
Securities sold under repurchase agreements152,472 186,468 
Federal Home Loan Bank advances723,480 598,865 
Subordinated debentures and other borrowings151,325 151,299 
Total Borrowings1,027,277 1,036,632 
Interest payable13,595 2,978 
Other liabilities200,820 192,372 
Total Liabilities15,822,847 15,802,851 
STOCKHOLDERS' EQUITY
Preferred Stock, $1,000 par value, $1,000 liquidation value:
Authorized -- 600 cumulative shares
Issued and outstanding - 125 cumulative shares125 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 shares25,000 25,000 
Common Stock, $.125 stated value:
Authorized -- 100,000,000 shares
Issued and outstanding - 59,297,148 and 59,059,866 shares7,412 7,383 
Additional paid-in capital1,233,593 1,226,378 
Retained earnings1,097,399 917,311 
Accumulated other comprehensive loss(217,964)(198,556)
Total Stockholders' Equity2,145,565 1,977,641 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY$17,968,412 $17,780,492 







CONSOLIDATED STATEMENTS OF INCOMEThree Months EndedSix Months Ended
(Dollars In Thousands, Except Per Share Amounts)June 30,June 30,
2023202220232022
INTEREST INCOME
Loans receivable:
Taxable$186,256 $106,787 $358,609 $185,862 
Tax-exempt7,760 5,990 15,469 11,694 
Investment securities:
Taxable8,886 10,372 17,973 18,882 
Tax-exempt14,279 17,212 30,349 33,087 
Deposits with financial institutions3,164 610 3,801 840 
Federal Home Loan Bank stock1,020 175 1,562 321 
Total Interest Income221,365 141,146 427,763 250,686 
INTEREST EXPENSE
Deposits73,201 8,485 123,886 12,779 
Federal funds purchased123 76 1,420 76 
Securities sold under repurchase agreements979 134 1,827 223 
Federal Home Loan Bank advances6,815 1,774 13,879 2,992 
Subordinated debentures and other borrowings2,412 2,016 4,797 3,675 
Total Interest Expense83,530 12,485 145,809 19,745 
NET INTEREST INCOME137,835 128,661 281,954 230,941 
Provision for credit losses - loans— 16,755 — 16,755 
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES137,835 111,906 281,954 214,186 
NON-INTEREST INCOME
Service charges on deposit accounts7,813 7,690 15,172 14,109 
Fiduciary and wealth management fees7,397 7,634 15,259 14,966 
Card payment fees4,537 5,175 9,709 10,898 
Net gains and fees on sales of loans3,632 3,226 6,031 5,425 
Derivative hedge fees672 1,444 1,820 2,362 
Other customer fees742 662 1,259 1,072 
Earnings on cash surrender value of life insurance2,096 1,308 3,384 3,004 
Net realized gains (losses) on sales of available for sale securities(1,392)90 (2,963)656 
Other income822 1,048 1,645 1,682 
Total Non-Interest Income26,319 28,277 51,316 54,174 
NON-INTEREST EXPENSES
Salaries and employee benefits54,753 56,041 112,212 98,560 
Net occupancy6,674 6,648 13,933 12,835 
Equipment6,181 6,720 12,307 11,800 
Marketing1,102 1,414 2,411 2,150 
Outside data processing fees6,604 4,881 12,717 9,244 
Printing and office supplies434 381 817 726 
Intangible asset amortization2,182 2,303 4,379 3,669 
FDIC assessments2,740 2,924 4,136 5,116 
Other real estate owned and foreclosure expenses916 (266)898 298 
Professional and other outside services4,660 10,267 8,358 13,220 
Other expenses6,347 6,000 14,145 12,020 
Total Non-Interest Expenses92,593 97,313 186,313 169,638 
INCOME BEFORE INCOME TAX71,561 42,870 146,957 98,722 
Income tax expense10,699 3,879 22,016 11,145 
NET INCOME60,862 38,991 124,941 87,577 
Preferred stock dividends469 469 938 469 
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS$60,393 $38,522 $124,003 $87,108 
Per Share Data:
Basic Net Income Available to Common Stockholders$1.02 $0.64 $2.09 $1.55 
Diluted Net Income Available to Common Stockholders$1.02 $0.63 $2.09 $1.54 
Cash Dividends Paid to Common Stockholders$0.34 $0.32 $0.66 $0.61 
Average Diluted Common Shares Outstanding (in thousands)59,448 59,308 59,446 56,516 




FINANCIAL HIGHLIGHTS
(Dollars in thousands)Three Months EndedSix Months Ended
June 30,June 30,
2023202220232022
NET CHARGE-OFFS (RECOVERIES)$1,905 $263 $2,130 $(324)
AVERAGE BALANCES:
Total Assets$18,170,649 $17,778,221 $18,096,832 $16,627,804 
Total Loans12,369,673 11,175,188 12,253,176 10,220,860 
Total Earning Assets16,968,465 16,435,747 16,896,834 15,355,265 
Total Deposits14,719,913 14,809,528 14,572,480 13,819,111 
Total Stockholders' Equity2,139,877 2,021,123 2,111,658 1,956,532 
FINANCIAL RATIOS:
Return on Average Assets1.34 %0.88 %1.38 %1.05 %
Return on Average Stockholders' Equity11.29 7.62 11.74 8.90 
Return on Tangible Common Stockholders' Equity18.04 12.91 18.91 13.98 
Average Earning Assets to Average Assets93.38 92.45 93.37 92.35 
Allowance for Credit Losses - Loans as % of Total Loans1.80 1.98 1.80 1.98 
Net Charge-offs as % of Average Loans (Annualized)0.06 0.01 0.03 (0.01)
Average Stockholders' Equity to Average Assets11.78 11.37 11.67 11.77 
Tax Equivalent Yield on Average Earning Assets5.36 3.58 5.21 3.42 
Interest Expense/Average Earning Assets1.97 0.30 1.73 0.26 
Net Interest Margin (FTE) on Average Earning Assets3.39 3.28 3.48 3.16 
Efficiency Ratio52.21 58.45 51.96 55.90 
Tangible Common Book Value Per Share$23.34 $20.45 $23.34 $20.45 

NON-PERFORMING ASSETS
(Dollars In Thousands)June 30,March 31,December 31,September 30,June 30,
20232023202220222022
Non-Accrual Loans$69,240 $46,576 $42,324 $43,508 $45,970 
Troubled Debt Restructures (TDR)— — 224 195 233 
Non-Performing Loans (NPL)69,240 46,576 42,548 43,703 46,203 
Other Real Estate Owned and Repossessions7,685 7,777 6,431 6,454 6,521 
Non-Performing Assets (NPA)76,925 54,353 48,979 50,157 52,724 
90+ Days Delinquent428 7,032 1,737 764 592 
NPAs & 90 Day Delinquent$77,353 $61,385 $50,716 $50,921 $53,316 
Allowance for Credit Losses - Loans$221,147 $223,052 $223,277 $226,702 $226,275 
Quarterly Net Charge-offs (Recoveries)1,905 225 2,674 (427)263 
NPAs / Actual Assets %0.43 %0.30 %0.27 %0.28 %0.30 %
NPAs & 90 Day / Actual Assets %0.43 %0.34 %0.28 %0.29 %0.30 %
NPAs / Actual Loans and OREO %0.63 %0.44 %0.41 %0.43 %0.46 %
Allowance for Credit Losses - Loans / Actual Loans (%)1.80 %1.82 %1.86 %1.94 %1.98 %
Net Charge-offs (Recoveries) as % of Average Loans (Annualized)0.06 %0.01 %0.12 %(0.01)%0.01 %




CONSOLIDATED BALANCE SHEETS
(Dollars In Thousands)June 30,March 31,December 31,September 30,June 30,
20232023202220222022
ASSETS
Cash and due from banks$108,975 $125,818 $122,594 $119,532 $212,559 
Interest-bearing deposits219,480 352,695 126,061 179,593 136,702 
Investment securities, net of allowance for credit losses3,891,491 4,057,389 4,263,788 4,294,768 4,630,030 
Loans held for sale27,297 9,408 9,094 25,394 9,060 
Loans12,270,233 12,241,461 12,003,894 11,650,002 11,397,417 
Less: Allowance for credit losses - loans(221,147)(223,052)(223,277)(226,702)(226,275)
Net loans12,049,086 12,018,409 11,780,617 11,423,300 11,171,142 
Premises and equipment114,402 115,857 117,118 116,306 117,757 
Federal Home Loan Bank stock41,842 41,878 38,525 38,056 38,111 
Interest receivable89,784 85,515 85,070 71,605 68,728 
Goodwill and other intangibles743,465 745,647 747,844 750,713 753,649 
Cash surrender value of life insurance307,020 309,090 308,311 306,932 323,013 
Other real estate owned7,685 7,777 6,431 6,454 6,521 
Tax asset, deferred and receivable113,724 103,070 111,222 142,110 114,965 
Other assets254,161 206,355 221,631 244,222 198,255 
TOTAL ASSETS$17,968,412 $18,178,908 $17,938,306 $17,718,985 $17,780,492 
LIABILITIES
Deposits:
Noninterest-bearing$2,636,017 $2,964,355 $3,173,417 $3,356,651 $3,435,331 
Interest-bearing11,945,138 11,738,932 11,209,328 11,078,174 11,135,538 
Total Deposits14,581,155 14,703,287 14,382,745 14,434,825 14,570,869 
Borrowings:
Federal funds purchased— 20 171,560 185,000 100,000 
Securities sold under repurchase agreements152,472 179,067 167,413 194,482 186,468 
Federal Home Loan Bank advances723,480 823,577 823,674 643,769 598,865 
Subordinated debentures and other borrowings151,325 151,312 151,298 151,301 151,299 
Total Borrowings1,027,277 1,153,976 1,313,945 1,174,552 1,036,632 
Interest payable13,595 11,979 7,530 4,971 2,978 
Other liabilities200,820 187,218 199,316 197,971 192,372 
Total Liabilities15,822,847 16,056,460 15,903,536 15,812,319 15,802,851 
STOCKHOLDERS' EQUITY
Preferred Stock, $1,000 par value, $1,000 liquidation value:
Authorized -- 600 cumulative shares
Issued and outstanding - 125 cumulative shares125 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 shares25,000 25,000 25,000 25,000 25,000 
Common Stock, $.125 stated value:
Authorized -- 100,000,000 shares
Issued and outstanding7,412 7,407 7,396 7,393 7,383 
Additional paid-in capital1,233,593 1,231,532 1,228,626 1,226,695 1,226,378 
Retained earnings1,097,399 1,057,298 1,012,774 961,542 917,311 
Accumulated other comprehensive loss(217,964)(198,914)(239,151)(314,089)(198,556)
Total Stockholders' Equity2,145,565 2,122,448 2,034,770 1,906,666 1,977,641 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY$17,968,412 $18,178,908 $17,938,306 $17,718,985 $17,780,492 








CONSOLIDATED STATEMENTS OF INCOME
(Dollars In Thousands, Except Per Share Amounts)June 30,March 31,December 31,September 30,June 30,
20232023202220222022
INTEREST INCOME
Loans receivable:
Taxable$186,256 $172,353 $156,102 $128,504 $106,787 
Tax-exempt7,760 7,709 6,930 6,500 5,990 
Investment securities:
Taxable8,886 9,087 9,417 10,055 10,372 
Tax-exempt14,279 16,070 17,033 17,261 17,212 
Deposits with financial institutions3,164 637 959 704 610 
Federal Home Loan Bank stock1,020 542 541 314 175 
Total Interest Income221,365 206,398 190,982 163,338 141,146 
INTEREST EXPENSE
Deposits73,201 50,685 33,516 16,644 8,485 
Federal funds purchased123 1,297 808 418 76 
Securities sold under repurchase agreements979 848 541 372 134 
Federal Home Loan Bank advances6,815 7,064 4,932 3,493 1,774 
Subordinated debentures and other borrowings2,412 2,385 2,229 2,105 2,016 
Total Interest Expense83,530 62,279 42,026 23,032 12,485 
NET INTEREST INCOME137,835 144,119 148,956 140,306 128,661 
Provision for credit losses - loans— — — — 16,755 
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES137,835 144,119 148,956 140,306 111,906 
NON-INTEREST INCOME
Service charges on deposit accounts7,813 7,359 7,097 7,165 7,690 
Fiduciary and wealth management fees7,397 7,862 7,501 7,221 7,634 
Card payment fees4,537 5,172 4,533 4,776 5,175 
Net gains and fees on sales of loans3,632 2,399 2,087 2,543 3,226 
Derivative hedge fees672 1,148 326 700 1,444 
Other customer fees742 517 362 501 662 
Earnings on cash surrender value of life insurance2,096 1,288 1,515 6,655 1,308 
Net realized gains (losses) on sales of available for sale securities(1,392)(1,571)57 481 90 
Other income (loss)822 823 672 (425)1,048 
Total Non-Interest Income26,319 24,997 24,150 29,617 28,277 
NON-INTEREST EXPENSES
Salaries and employee benefits54,753 57,459 52,331 56,002 56,041 
Net occupancy6,674 7,259 6,638 6,738 6,648 
Equipment6,181 6,126 6,148 5,997 6,720 
Marketing1,102 1,309 3,157 2,401 1,414 
Outside data processing fees6,604 6,113 5,611 6,827 4,881 
Printing and office supplies434 383 390 472 381 
Intangible asset amortization2,182 2,197 2,303 2,303 2,303 
FDIC assessments2,740 1,396 2,295 2,824 2,924 
Other real estate owned and foreclosure expenses916 (18)197 328 (266)
Professional and other outside services4,660 3,698 3,961 4,461 10,267 
Other expenses6,347 7,798 6,668 8,025 6,000 
Total Non-Interest Expenses92,593 93,720 89,699 96,378 97,313 
INCOME BEFORE INCOME TAX71,561 75,396 83,407 73,545 42,870 
Income tax expense10,699 11,317 12,647 9,793 3,879 
NET INCOME60,862 64,079 70,760 63,752 38,991 
Preferred stock dividends469 469 468 469 469 
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS$60,393 $63,610 $70,292 $63,283 $38,522 
Per Share Data:
Basic Net Income Available to Common Stockholders$1.02 $1.07 $1.20 $1.08 $0.64 
Diluted Net Income Available to Common Stockholders$1.02 $1.07 $1.19 $1.08 $0.63 
Cash Dividends Paid to Common Stockholders$0.34 $0.32 $0.32 $0.32 $0.32 
Average Diluted Common Shares Outstanding (in thousands)59,448 59,441 59,384 59,339 59,308 
FINANCIAL RATIOS:
Return on Average Assets1.34 %1.42 %1.59 %1.43 %0.88 %
Return on Average Stockholders' Equity11.29 12.21 14.36 12.54 7.62 
Return on Tangible Common Stockholders' Equity18.04 19.82 24.21 20.85 12.91 
Average Earning Assets to Average Assets93.38 93.35 93.66 92.90 92.45 
Allowance for Credit Losses - Loans as % of Total Loans1.80 1.82 1.86 1.94 1.98 
Net Charge-offs (Recoveries) as % of Average Loans (Annualized)0.06 0.01 0.12 (0.01)0.01 
Average Stockholders' Equity to Average Assets11.78 11.56 10.98 11.36 11.37 
Tax Equivalent Yield on Average Earning Assets5.36 5.06 4.73 4.11 3.58 
Interest Expense/Average Earning Assets1.97 1.48 1.01 0.56 0.30 
Net Interest Margin (FTE) on Average Earning Assets3.39 3.58 3.72 3.55 3.28 
Efficiency Ratio52.21 51.72 48.60 53.34 58.45 
Tangible Common Book Value Per Share$23.34 $22.93 $21.45 $19.26 $20.45 




LOANS
(Dollars In Thousands)June 30,March 31,December 31,September 30,June 30,
20232023202220222022
Commercial and industrial loans$3,531,395 $3,502,204 $3,437,126 $3,330,529 $3,297,477 
Agricultural land, production and other loans to farmers230,003 219,598 241,793 221,954 214,904 
Real estate loans:
Construction949,918 960,979 835,582 828,923 745,983 
Commercial real estate, non-owner occupied2,379,819 2,375,410 2,407,475 2,299,272 2,423,185 
Commercial real estate, owner occupied1,179,739 1,244,117 1,246,528 1,268,567 1,264,563 
Residential2,248,473 2,185,943 2,096,655 1,990,668 1,813,297 
Home equity614,366 621,354 630,632 621,619 586,108 
Individuals' loans for household and other personal expenditures172,896 172,389 175,211 173,225 157,264 
Public finance and other commercial loans963,624 959,467 932,892 915,245 894,636 
Loans12,270,233 12,241,461 12,003,894 11,650,002 11,397,417 
Allowance for credit losses - loans(221,147)(223,052)(223,277)(226,702)(226,275)
NET LOANS$12,049,086 $12,018,409 $11,780,617 $11,423,300 $11,171,142 

DEPOSITS
(Dollars In Thousands)June 30,March 31,December 31,September 30,June 30,
20232023202220222022
Demand deposits$8,045,455 $8,422,387 $8,448,797 $8,534,950 $8,785,889 
Savings deposits4,530,255 4,499,487 4,657,140 5,054,490 4,875,880 
Certificates and other time deposits of $100,000 or more1,160,303 1,040,379 742,539 443,588 436,942 
Other certificates and time deposits680,965 574,886 468,712 381,365 446,973 
Brokered certificates of deposits164,177 166,148 65,557 20,432 25,185 
TOTAL DEPOSITS$14,581,155 $14,703,287 $14,382,745 $14,434,825 $14,570,869 





CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST MARGIN ANALYSIS
(Dollars in Thousands)
For the Three Months Ended
June 30, 2023June 30, 2022
Average BalanceInterest
 Income /
Expense		Average
Rate		Average BalanceInterest
 Income /
Expense		Average
Rate
ASSETS
Interest-bearing deposits$343,253 $3,164 3.69 %$329,626 $610 0.74 %
Federal Home Loan Bank stock41,873 1,020 9.74 38,111 175 1.84 
Investment Securities: (1)
Taxable1,876,676 8,886 1.89 2,189,193 10,372 1.90 
Tax-exempt (2)
2,336,990 18,075 3.09 2,703,629 21,788 3.22 
Total Investment Securities4,213,666 26,961 2.56 4,892,822 32,160 2.63 
Loans held for sale19,328 300 6.21 28,491 315 4.42 
Loans: (3)
Commercial8,605,339 150,766 7.01 8,134,050 85,867 4.22 
Real estate mortgage2,031,136 20,345 4.01 1,458,317 12,657 3.47 
Installment831,775 14,844 7.14 772,610 7,948 4.11 
Tax-exempt (2)
882,095 9,823 4.45 781,720 7,582 3.88 
Total Loans12,369,673 196,078 6.34 11,175,188 114,369 4.09 
Total Earning Assets16,968,465 227,223 5.36 %16,435,747 147,314 3.58 %
Total Non-Earning Assets1,202,184 1,342,474 
TOTAL ASSETS$18,170,649 $17,778,221 
LIABILITIES
Interest-Bearing Deposits:
Interest-bearing deposits$5,546,232 $34,574 2.49 %$5,372,474 $4,569 0.34 %
Money market deposits2,766,876 18,684 2.70 3,024,560 2,130 0.28 
Savings deposits1,724,816 3,884 0.90 1,966,054 916 0.19 
Certificates and other time deposits1,883,998 16,059 3.41 948,799 870 0.37 
Total Interest-Bearing Deposits11,921,922 73,201 2.46 11,311,887 8,485 0.30 
Borrowings1,110,486 10,329 3.72 818,851 4,000 1.95 
Total Interest-Bearing Liabilities13,032,408 83,530 2.56 12,130,738 12,485 0.41 
Noninterest-bearing deposits2,797,991 3,497,641 
Other liabilities200,373 128,719 
Total Liabilities16,030,772 15,757,098 
STOCKHOLDERS' EQUITY2,139,877 2,021,123 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY$18,170,649 83,530 $17,778,221 12,485 
Net Interest Income (FTE)$143,693 $134,829 
Net Interest Spread (FTE) (4)
2.80 %3.17 %
Net Interest Margin (FTE):
Interest Income (FTE) / Average Earning Assets5.36 %3.58 %
Interest Expense / Average Earning Assets1.97 %0.30 %
Net Interest Margin (FTE) (5)
3.39 %3.28 %
(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 2023 and 2022. These totals equal $5,858 and $6,168 for the three months ended June 30, 2023 and 2022, respectively.
(3) Non accruing loans have been included in the average balances.
(4) Net Interest Spread (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average interest-bearing liabilities.
(5) Net Interest Margin (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average earning assets.







CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST MARGIN ANALYSIS
(Dollars in Thousands)
For the Six Months Ended
June 30, 2023June 30, 2022
Average BalanceInterest
 Income /
Expense		Average
Rate		Average BalanceInterest
 Income /
Expense		Average
Rate
Assets:
Interest-bearing deposits$258,504 $3,801 2.94 %$406,698 $840 0.41 %
Federal Home Loan Bank stock40,821 1,562 7.65 33,040 321 1.94 
Investment Securities: (1)
Taxable1,900,247 17,973 1.89 2,074,074 18,882 1.82 
Tax-exempt (2)
2,444,086 38,416 3.14 2,620,593 41,882 3.20 
Total Investment Securities4,344,333 56,389 2.60 4,694,667 60,764 2.59 
Loans held for sale21,952 660 6.01 18,181 355 3.91 
Loans: (3)
Commercial8,544,945 290,428 6.80 7,504,740 150,545 4.01 
Real estate mortgage1,972,680 38,736 3.93 1,191,075 20,497 3.44 
Installment836,088 28,785 6.89 741,994 14,465 3.90 
Tax-exempt (2)
877,511 19,581 4.46 764,870 14,803 3.87 
Total Loans12,253,176 378,190 6.17 10,220,860 200,665 3.93 
Total Earning Assets16,896,834 439,942 5.21 %15,355,265 262,590 3.42 %
Total Non-Earning Assets1,199,998 1,272,539 
Total Assets$18,096,832 $16,627,804 
Liabilities:
Interest-Bearing deposits:
Interest-bearing deposits$5,405,696 $59,237 2.19 %$5,200,923 $6,977 0.27 %
Money market deposits2,756,519 32,261 2.34 2,770,904 3,002 0.22 
Savings deposits1,775,233 6,849 0.77 1,917,005 1,357 0.14 
Certificates and other time deposits1,676,291 25,539 3.05 813,482 1,443 0.35 
Total Interest-Bearing Deposits11,613,739 123,886 2.13 10,702,314 12,779 0.24 
Borrowings1,201,392 21,923 3.65 718,270 6,966 1.94 
Total Interest-Bearing Liabilities12,815,131 145,809 2.28 11,420,584 19,745 0.35 
Noninterest-bearing deposits2,958,741 3,116,797 
Other liabilities211,302 133,891 
Total Liabilities15,985,174 14,671,272 
Stockholders' Equity2,111,658 1,956,532 
Total Liabilities and Stockholders' Equity$18,096,832 145,809 $16,627,804 19,745 
Net Interest Income (FTE)$294,133 $242,845 
Net Interest Spread (FTE) (4)
2.93 %3.07 %
Net Interest Margin (FTE):
Interest Income (FTE) / Average Earning Assets5.21 %3.42 %
Interest Expense / Average Earning Assets1.73 %0.26 %
Net Interest Margin (FTE) (5)
3.48 %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 2023 and 2022. These totals equal $12,179 and $11,904 for the six months ended June 30, 2023 and 2022, 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 EPS EXCLUDING PAYCHECK PROTECTION PROGRAM ("PPP") AND ACQUISITION-RELATED EXPENSES - NON-GAAP
(Dollars In Thousands, Except Per Share Amounts)Three Months EndedSix Months Ended
June 30,March 31,December 31,September 30,June 30,June 30,June 30,
2023202320222022202220232022
Net Income Available to Common Stockholders - GAAP$60,393 $63,610 $70,292 $63,283 $38,522 $124,003 $87,108 
Adjustments:
PPP loan income(9)(25)(109)(323)(891)(34)(2,775)
Acquisition-related expenses— — 413 3,417 12,549 — 12,701 
Acquisition-related provision expense— — — — 16,755 — 16,755 
Tax on adjustment2 6 (75)(759)(6,967)8 (6,542)
Adjusted Net Income Available to Common Stockholders - Non-GAAP$60,386 $63,591 $70,521 $65,618 $59,968 $123,977 $107,247 
Average Diluted Common Shares Outstanding (in thousands)59,448 59,441 59,384 59,339 59,308 59,446 56,516 
Diluted Earnings Per Common Share - GAAP$1.02 $1.07 $1.19 $1.08 $0.63 $2.09 $1.54 
Adjustments:
PPP loan income— — (0.01)— (0.01)— (0.05)
Acquisition-related expenses— — 0.010.05 0.22 — 0.22 
Acquisition-related provision expense— — — — 0.30 — 0.30 
Tax on adjustment— — — (0.01)(0.13)— (0.12)
Adjusted Diluted Earnings Per Common Share - Non-GAAP$1.02 $1.07 $1.19 $1.12 $1.01 $2.09 $1.89 

RETURN ON TANGIBLE COMMON EQUITY - NON-GAAP
(Dollars In Thousands)Three Months EndedSix Months Ended
June 30,March 31,December 31,September 30,June 30,June 30,June 30,
2023202320222022202220232022
Total Average Stockholders' Equity (GAAP)$2,139,877 $2,083,125 $1,958,041 $2,018,156 $2,021,123 $2,111,658 $1,956,532 
Less: Average Preferred Stock(25,125)(25,125)(25,125)(25,125)(25,125)(25,125)(12,625)
Less: Average Intangible Assets, Net of Tax(737,489)(739,190)(741,632)(744,069)(745,614)(738,334)(656,042)
Average Tangible Common Equity, Net of Tax (Non-GAAP)$1,377,263 $1,318,810 $1,191,284 $1,248,962 $1,250,384 $1,348,199 $1,287,865 
Net Income Available to Common Stockholders (GAAP)$60,393 $63,610 $70,292 $63,283 $38,521 $124,003 $87,108 
Plus: Intangible Asset Amortization, Net of Tax1,724 1,734 1,819 1,819 1,820 3,458 2,898 
Tangible Net Income (Non-GAAP)$62,117 $65,344 $72,111 $65,102 $40,341 $127,461 $90,006 
Return on Tangible Common Equity (Non-GAAP)18.04 %19.82 %24.21 %20.85 %12.91 %18.91 %13.98 %