SEC Filing | First Merchants Corporation

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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, 2018

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)

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:

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

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

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

o 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 o

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. o

ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

On July 25, 2018, First Merchants Corporation issued a press release to report its financial results for the second quarter ended June 30, 2018. 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 July 25, 2018, issued by First Merchants Corporation

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/ Mark K. Hardwick

Mark K. Hardwick

Executive Vice President,

Chief Financial Officer and Chief Operating Officer

Dated: July 25, 2018

EXHIBIT INDEX


Exhibit No.	Description

99.1 Press Release, dated July 25, 2018, issued by First Merchants Corporation

Exhibit

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

July 25, 2018

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 40 PERCENT INCREASE IN SECOND QUARTER 2018 EARNINGS PER SHARE

First Merchants Corporation (NASDAQ - FRME) has reported second quarter 2018 net income of $39.6 million, an increase of 64 percent, compared to $24.1 million during the same period in 2017. Earnings per share for the period totaled $.80 per share, an increase of 40 percent, compared to the second quarter of 2017 result of $.57 per share. Net income for the six months ended June 30, 2018 totaled $76.3 million, compared to $47.3 million during the same period in 2017. Year-to-date earnings per share totaled $1.54 per share, an increase of $.41 per share, or 36 percent, over the same period in 2017. The increases in net income were driven by several key factors including strong core banking performance, two acquisitions that were fully integrated during the second half of 2017 and the impact of tax reform.

Total assets equaled $9.7 billion as of quarter-end and loans totaled $7.1 billion. The Corporation’s loan portfolio increased, by $1.5 billion, or 26 percent, during the past twelve months. The acquisition of Independent Alliance Banks, Inc. in Fort Wayne, Indiana accounted for $726 million, or 13 percent. Additionally, organic loan growth totaled $740 million, or 13 percent. Total deposits equaled $7.5 billion as of quarter-end and increased by $1.5 billion, or 25 percent. Our acquisition activity accounted for growth of $862 million, or 14 percent, while organic deposit growth totaled $624 million, or 10 percent.

Michael C. Rechin, President and Chief Executive Officer, stated, “Our second quarter results reflect a sustained effort by our teammates on high performance. Our daily execution of market coverage and high touch service continues to yield strong organic growth. In combination with our highly efficient operating model, we continue to drive net interest income, profitability, performance and returns at levels produced by the best firms in our industry. We are optimistic about the health of our markets and are investing in the talent and technology we need going forward.”

Net-interest income totaled $84.6 million for the quarter, an increase of $21.5 million, or 34 percent. Net-interest margin totaling 3.99 percent, increased by 4 basis points and included a reduction of 12 basis points related to tax reform. Yields on earning assets totaled 4.74 percent and the cost of supporting liabilities totaled .75 percent.

Non-interest income totaled $18.2 million for the quarter, a $243,000 decrease from the second quarter of 2017. Non-interest expense totaled $53.5 million up from the 2017 total of $47.3 million. Increases in non-interest expense are primarily related to acquisition activity in 2017.

Tax expense for the second quarter of 2018 totaled $8 million, or 16.7 percent of pre-tax net income. Tax expense in the prior year totaled $7.2 million, or 23 percent. The improvement in tax expense was due to a decline in the federal tax rate from 35 percent to 21 percent. Our effective rate is lower than the federal tax rate of 21 percent, primary due to approximately $10.9 million of tax free loan, securities and life insurance income in the quarter.

The Corporation’s provision expense totaled $1.7 million during the quarter primarily due to loan growth, with net charge-offs totaling $540,000. The allowance for loan losses totaled $77.5 million as of June 30, 2018, up from $70.5 million during the same period in 2017, and equaled 1.09 percent of total loans and 1.28 percent of non-purchased loans. Credit metrics continued to improve, including a decline in non-accrual loans, which totaled $20.1 million as of quarter-end.

As of June 30, 2018, the Corporation’s total risk-based capital ratio equaled 13.81 percent, common equity tier 1 capital ratio equaled 11.21 percent, and the tangible common equity ratio totaled 9.36 percent.

CONFERENCE CALL

First Merchants Corporation will conduct a second quarter earnings conference call and web cast at 2:30 p.m. (ET) on Thursday, July 26, 2018.

To participate, dial (Toll Free) 877-507-0578 and reference First Merchants Corporation's second quarter earnings release. International callers please call +1 412-317-1073. A replay of the call will be available until August 26, 2018. To access a replay of the call, US participants should dial (Toll Free) 877-344-7529, or for International participants, dial +1 412-317-0088. The replay access code is 10120572.

In order to view the web cast and presentation slides, please go to http://services.choruscall.com/links/frme180726.html during the time of the call. A replay of the web cast will be available until July 26, 2019.

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 Lafayette Bank & Trust and First Merchants Private Wealth Advisors (each 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)	June 30,
	2018			2017
ASSETS
Cash and cash equivalents	$	133,893		$	142,650
Interest-bearing time deposits	36,599			48,305
Investment securities	1,619,683			1,343,323
Loans held for sale	2,046			4,036
Loans	7,081,059			5,613,144
Less: Allowance for loan losses	(77,543		)	(70,471		)
Net loans	7,003,516			5,542,673
Premises and equipment	94,397			92,637
Federal Home Loan Bank stock	24,588			19,015
Interest receivable	38,530			27,597
Goodwill and other intangibles	473,059			309,686
Cash surrender value of life insurance	222,905			200,125
Other real estate owned	9,071			11,893
Tax asset, deferred and receivable	24,619			27,331
Other assets	51,809			35,758
TOTAL ASSETS	$	9,734,715		$	7,805,029
LIABILITIES
Deposits:
Noninterest-bearing	$	1,571,194		$	1,398,237
Interest-bearing	5,932,621			4,618,867
Total Deposits	7,503,815			6,017,104
Borrowings:
Federal funds purchased	109,000			134,608
Securities sold under repurchase agreements	122,513			127,884
Federal Home Loan Bank advances	469,261			312,715
Subordinated debentures and term loans	138,352			128,742
Total Borrowings	839,126			703,949
Interest payable	4,807			3,477
Other liabilities	46,639			45,383
Total Liabilities	8,394,387			6,769,913
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 - 49,280,188 and 43,153,509 shares	6,160			5,394
Additional paid-in capital	836,549			593,904
Retained earnings	522,362			434,309
Accumulated other comprehensive income (loss)	(24,868		)	1,384
Total Stockholders' Equity	1,340,328			1,035,116
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	9,734,715		$	7,805,029



CONSOLIDATED STATEMENTS OF INCOME	Three Months Ended				Six Months Ended
(Dollars In Thousands, Except Per Share Amounts)	June 30,				June 30,
	2018		2017		2018		2017
INTEREST INCOME
Loans receivable:
Taxable	$	84,663	$	59,386	$	162,930	$	115,743
Tax-exempt	3,632		2,492		7,228		4,825
Investment securities:
Taxable	5,434		4,180		10,530		8,488
Tax-exempt	6,246		5,091		12,372		10,094
Deposits with financial institutions	633		114		764		158
Federal Home Loan Bank stock	263		204		667		393
Total Interest Income	100,871		71,467		194,491		139,701
INTEREST EXPENSE
Deposits	12,165		5,137		21,167		9,261
Federal funds purchased	61		103		441		331
Securities sold under repurchase agreements	172		110		345		198
Federal Home Loan Bank advances	1,845		1,177		4,004		2,155
Subordinated debentures and term loans	2,057		1,840		4,047		3,657
Total Interest Expense	16,300		8,367		30,004		15,602
NET INTEREST INCOME	84,571		63,100		164,487		124,099
Provision for loan losses	1,663		2,875		4,163		5,260
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES	82,908		60,225		160,324		118,839
OTHER INCOME
Service charges on deposit accounts	5,038		4,438		9,815		8,612
Fiduciary and wealth management fees	3,150		2,609		6,566		5,249
Other customer fees	5,362		5,406		10,778		10,269
Earnings on cash surrender value of life insurance	1,007		2,971		2,183		3,869
Net gains and fees on sales of loans	1,600		1,617		3,421		2,892
Net realized gains on sales of available for sale securities	1,122		567		2,731		1,165
Other income	912		826		2,258		1,224
Total Other Income	18,191		18,434		37,752		33,280
OTHER EXPENSES
Salaries and employee benefits	32,192		27,076		64,418		52,808
Net occupancy	4,348		3,965		9,018		8,181
Equipment	3,556		2,907		7,224		5,714
Marketing	1,474		792		2,358		1,357
Outside data processing fees	3,462		3,086		6,426		5,702
Printing and office supplies	324		275		658		539
Intangible asset amortization	1,718		991		3,444		1,894
FDIC assessments	711		579		1,430		1,149
Other real estate owned and foreclosure expenses	362		731		764		1,262
Professional and other outside services	1,789		3,266		3,330		5,000
Other expenses	3,568		3,648		8,121		6,809
Total Other Expenses	53,504		47,316		107,191		90,415
INCOME BEFORE INCOME TAX	47,595		31,343		90,885		61,704
Income tax expense	7,961		7,207		14,572		14,375
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS	$	39,634	$	24,136	$	76,313	$	47,329
Per Share Data:
Basic Net Income Available to Common Stockholders	$	0.80	$	0.57	$	1.55	$	1.14
Diluted Net Income Available to Common Stockholders	$	0.80	$	0.57	$	1.54	$	1.13
Cash Dividends Paid	$	0.22	$	0.18	$	0.40	$	0.33
Average Diluted Shares Outstanding (in thousands)	49,451		42,244		49,440		41,735



FINANCIAL HIGHLIGHTS
(Dollars in thousands)	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2018			2017			2018			2017
NET CHARGE-OFFS	$	540		$	629		$	1,652		$	826

AVERAGE BALANCES:
Total Assets	$	9,697,020		$	7,571,789		$	9,535,774		$	7,395,450
Total Loans	6,975,737			5,436,961			6,893,867			5,309,311
Total Earning Assets	8,741,173			6,812,451			8,579,076			6,670,358
Total Deposits	7,636,821			5,930,532			7,396,328			5,761,384
Total Stockholders' Equity	1,327,341			983,096			1,318,124			948,769

FINANCIAL RATIOS:
Return on Average Assets	1.63		%	1.28		%	1.60		%	1.28		%
Return on Average Stockholders' Equity	11.94			9.82			11.58			9.98
Return on Average Common Stockholders' Equity	11.95			9.82			11.58			9.98
Average Earning Assets to Average Assets	90.14			89.97			89.97			90.20
Allowance for Loan Losses as % of Total Loans	1.09			1.25			1.09			1.25
Net Charge-offs as % of Average Loans (Annualized)	0.03			0.05			0.05			0.03
Average Stockholders' Equity to Average Assets	13.69			12.98			13.82			12.83
Tax Equivalent Yield on Average Earning Assets	4.74			4.44			4.66			4.43
Interest Expense/Average Earning Assets	0.75			0.49			0.70			0.47
Net Interest Margin (FTE) on Average Earning Assets	3.99			3.95			3.96			3.96
Efficiency Ratio	49.32			53.61			50.30			53.13
Tangible Common Book Value Per Share	$	17.71		$	16.97		$	17.71		$	16.97



NON-PERFORMING ASSETS
(Dollars In Thousands)	June 30,			March 31,			December 31,			September 30,			June 30,
	2018			2018			2017			2017			2017
Non-Accrual Loans	$	20,143		$	27,497		$	28,724		$	32,253		$	27,347
Renegotiated Loans	544			579			1,013			626			384
Non-Performing Loans (NPL)	20,687			28,076			29,737			32,879			27,731
Other Real Estate Owned	9,071			9,698			10,373			11,912			11,893
Non-Performing Assets (NPA)	29,758			37,774			40,110			44,791			39,624
90+ Days Delinquent	184			738			924			425			634
NPAs & 90 Day Delinquent	$	29,942		$	38,512		$	41,034		$	45,216		$	40,258

Allowance for Loan Losses	$	77,543		$	76,420		$	75,032		$	73,354		$	70,471
Quarterly Net Charge-offs	540			1,112			122			(800		)	629
NPAs / Actual Assets %	0.31		%	0.40		%	0.43		%	0.49		%	0.51		%
NPAs & 90 Day / Actual Assets %	0.31		%	0.41		%	0.44		%	0.50		%	0.52		%
NPAs / Actual Loans and OREO %	0.42		%	0.55		%	0.59		%	0.69		%	0.70		%
Allowance for Loan Losses / Actual Loans (%)	1.09		%	1.11		%	1.11		%	1.13		%	1.25		%
Net Charge-offs as % of Average Loans (Annualized)	0.03		%	0.07		%	0.01		%	(0.05		)%	0.05		%



CONSOLIDATED BALANCE SHEETS
(Dollars In Thousands)	June 30,			March 31,			December 31,			September 30,			June 30,
	2018			2018			2017			2017			2017
ASSETS
Cash and cash equivalents	$	133,893		$	128,828		$	154,905		$	146,607		$	142,650
Interest-bearing time deposits	36,599			24,233			35,027			72,950			48,305
Investment securities	1,619,683			1,543,820			1,560,602			1,468,887			1,343,323
Loans held for sale	2,046			4,469			7,216			4,514			4,036
Loans	7,081,059			6,901,696			6,751,199			6,483,448			5,613,144
Less: Allowance for loan losses	(77,543		)	(76,420		)	(75,032		)	(73,354		)	(70,471		)
Net loans	7,003,516			6,825,276			6,676,167			6,410,094			5,542,673
Premises and equipment	94,397			94,741			95,852			102,485			92,637
Federal Home Loan Bank stock	24,588			24,588			23,825			23,825			19,015
Interest receivable	38,530			35,223			37,130			32,366			27,597
Goodwill and other intangibles	473,059			474,777			476,503			478,558			309,686
Cash surrender value of life insurance	222,905			221,949			223,557			222,437			200,125
Other real estate owned	9,071			9,698			10,373			11,912			11,893
Tax asset, deferred and receivable	24,619			24,177			23,983			36,024			27,331
Other assets	51,809			61,017			42,338			38,744			35,758
TOTAL ASSETS	$	9,734,715		$	9,472,796		$	9,367,478		$	9,049,403		$	7,805,029
LIABILITIES
Deposits:
Noninterest-bearing	$	1,571,194		$	1,698,958		$	1,761,553		$	1,662,814		$	1,398,237
Interest-bearing	5,932,621			5,628,677			5,410,977			5,248,205			4,618,867
Total Deposits	7,503,815			7,327,635			7,172,530			6,911,019			6,017,104
Borrowings:
Federal funds purchased	109,000			50,000			144,038			100,000			134,608
Securities sold under repurchase agreements	122,513			138,910			136,623			142,107			127,884
Federal Home Loan Bank advances	469,261			449,419			414,377			406,820			312,715
Subordinated debentures and term loans	138,352			138,297			139,349			139,686			128,742
Total Borrowings	839,126			776,626			834,387			788,613			703,949
Interest payable	4,807			5,376			4,390			4,956			3,477
Other liabilities	46,639			50,086			52,708			61,695			45,383
Total Liabilities	8,394,387			8,159,723			8,064,015			7,766,283			6,769,913
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	6,160			6,155			6,145			6,143			5,394
Additional paid-in capital	836,549			834,894			834,870			833,451			593,904
Retained earnings	522,362			493,624			465,231			449,759			434,309
Accumulated other comprehensive income (loss)	(24,868		)	(21,725		)	(2,908		)	(6,358		)	1,384
Total Stockholders' Equity	1,340,328			1,313,073			1,303,463			1,283,120			1,035,116
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	9,734,715		$	9,472,796		$	9,367,478		$	9,049,403		$	7,805,029



CONSOLIDATED STATEMENTS OF INCOME
(Dollars In Thousands, Except Per Share Amounts)	June 30,			March 31,			December 31,			September 30,			June 30,
	2018			2018			2017			2017			2017
INTEREST INCOME
Loans receivable:
Taxable	$	84,663		$	78,267		$	76,470		$	71,491		$	59,386
Tax-exempt	3,632			3,596			3,018			2,851			2,492
Investment securities:
Taxable	5,434			5,096			4,477			4,524			4,180
Tax-exempt	6,246			6,126			5,830			5,455			5,091
Deposits with financial institutions	633			131			294			284			114
Federal Home Loan Bank stock	263			404			259			242			204
Total Interest Income	100,871			93,620			90,348			84,847			71,467
INTEREST EXPENSE
Deposits	12,165			9,002			7,835			6,710			5,137
Federal funds purchased	61			380			55			175			103
Securities sold under repurchase agreements	172			173			146			133			110
Federal Home Loan Bank advances	1,845			2,159			1,577			1,464			1,177
Subordinated debentures and term loans	2,057			1,990			1,970			1,945			1,840
Total Interest Expense	16,300			13,704			11,583			10,427			8,367
NET INTEREST INCOME	84,571			79,916			78,765			74,420			63,100
Provision for loan losses	1,663			2,500			1,800			2,083			2,875
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES	82,908			77,416			76,965			72,337			60,225
OTHER INCOME
Service charges on deposit accounts	5,038			4,777			5,066			5,044			4,438
Fiduciary and wealth management fees	3,150			3,416			3,345			2,995			2,609
Other customer fees	5,362			5,416			5,346			5,341			5,406
Earnings on cash surrender value of life insurance	1,007			1,176			1,133			1,575			2,971
Net gains and fees on sales of loans	1,600			1,821			2,355			2,317			1,617
Net realized gains on sales of available for sale securities	1,122			1,609			1,134			332			567
Other income	912			1,346			682			1,064			826
Total Other Income	18,191			19,561			19,061			18,668			18,434
OTHER EXPENSES
Salaries and employee benefits	32,192			32,226			33,760			33,244			27,076
Net occupancy	4,348			4,670			4,424			4,371			3,965
Equipment	3,556			3,668			3,898			3,478			2,907
Marketing	1,474			884			1,361			1,021			792
Outside data processing fees	3,462			2,964			3,378			3,162			3,086
Printing and office supplies	324			334			378			366			275
Intangible asset amortization	1,718			1,726			2,055			1,698			991
FDIC assessments	711			719			711			704			579
Other real estate owned and foreclosure expenses	362			402			311			330			731
Professional and other outside services	1,789			1,541			1,914			5,843			3,266
Other expenses	3,568			4,553			4,243			4,491			3,648
Total Other Expenses	53,504			53,687			56,433			58,708			47,316
INCOME BEFORE INCOME TAX	47,595			43,290			39,593			32,297			31,343
Income tax expense	7,961			6,611			15,210			7,939			7,207
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS	$	39,634		$	36,679		$	24,383		$	24,358		$	24,136

Per Share Data:
Basic Net Income Available to Common Stockholders	$	0.80		$	0.75		$	0.49		$	0.50		$	0.57
Diluted Net Income Available to Common Stockholders	$	0.80		$	0.74		$	0.49		$	0.50		$	0.57
Cash Dividends Paid	$	0.22		$	0.18		$	0.18		$	0.18		$	0.18
Average Diluted Shares Outstanding (in thousands)	49,451			49,428			49,379			48,644			42,244
FINANCIAL RATIOS:
Return on Average Assets	1.63		%	1.57		%	1.06		%	1.11		%	1.28		%
Return on Average Stockholders' Equity	11.94			11.21			7.53			7.83			9.82
Return on Average Common Stockholders' Equity	11.95			11.21			7.53			7.83			9.82
Average Earning Assets to Average Assets	90.14			89.78			88.73			89.16			89.97
Allowance for Loan Losses as % of Total Loans	1.09			1.11			1.11			1.13			1.25
Net Charge-offs as % of Average Loans (Annualized)	0.03			0.07			0.01			(0.05		)	0.05
Average Stockholders' Equity to Average Assets	13.69			13.96			14.11			14.15			12.98
Tax Equivalent Yield on Average Earning Assets	4.74			4.57			4.67			4.56			4.44
Interest Expense/Average Earning Assets	0.75			0.65			0.57			0.53			0.49
Net Interest Margin (FTE) on Average Earning Assets	3.99			3.92			4.10			4.03			3.95
Efficiency Ratio	49.32			51.33			53.29			58.30			53.61
Tangible Common Book Value Per Share	$	17.71		$	17.14		$	16.96		$	16.62		$	16.97



LOANS
(Dollars In Thousands)	June 30,			March 31,			December 31,			September 30,			June 30,
	2018			2018			2017			2017			2017
Commercial and industrial loans	$	1,657,591		$	1,554,169		$	1,493,493		$	1,436,092		$	1,289,884
Agricultural production financing and other loans to farmers	89,093			98,315			121,757			117,751			75,746
Real estate loans:
Construction	714,866			590,093			612,219			498,862			442,389
Commercial and farmland	2,652,782			2,713,994			2,562,691			2,571,253			2,167,729
Residential	965,720			948,644			962,765			938,437			847,580
Home equity	518,699			510,545			514,021			502,240			436,038
Individuals' loans for household and other personal expenditures	92,809			88,235			86,935			86,406			79,887
Lease financing receivables, net of unearned income	1,945			2,193			2,527			3,877			232
Other commercial loans	387,554			395,508			394,791			328,530			273,659
Loans	7,081,059			6,901,696			6,751,199			6,483,448			5,613,144
Allowance for loan losses	(7,543		)	(76,420		)	(75,032		)	(73,354		)	(70,471		)
NET LOANS	$	7,073,516		$	6,825,276		$	6,676,167		$	6,410,094		$	5,542,673



DEPOSITS
(Dollars In Thousands)	June 30,		March 31,		December 31,		September 30,		June 30,
	2018		2018		2017		2017		2017
Demand deposits	$	3,933,233	$	3,740,395	$	3,746,654	$	3,562,718	$	3,015,846
Savings deposits	2,099,771		2,109,071		1,994,366		1,884,705		1,708,478
Certificates and other time deposits of $100,000 or more	555,910		552,643		468,895		503,668		362,589
Other certificates and time deposits	602,239		584,377		581,894		585,042		511,935
Brokered deposits	312,662		341,149		380,721		374,886		418,256
TOTAL DEPOSITS	$	7,503,815	$	7,327,635	$	7,172,530	$	6,911,019	$	6,017,104



NET INTEREST INCOME
(Dollars in Thousands)	For the Three Months Ended
	June 30, 2018							June 30, 2017
	Average Balance			Interest Income / Expense		Average Rate		Average Balance			Interest Income / Expense		Average Rate
Assets:
Interest-bearing time deposits	$	142,385		$	633	1.78	%	$	42,794		$	114	1.07	%
Federal Home Loan Bank stock	24,588			263		4.28		18,655			204		4.37
Investment Securities: ⁽¹⁾
Taxable	852,865			5,434		2.55		717,818			4,180		2.33
Tax-Exempt ⁽²⁾	745,598			7,906		4.24		596,223			7,832		5.25
Total Investment Securities	1,598,463			13,340		3.34		1,314,041			12,012		3.66
Loans held for sale	6,408			83		5.18		3,791			65		6.86
Loans: ⁽³⁾
Commercial	5,142,093			67,510		5.25		3,911,477			45,400		4.64
Real Estate Mortgage	729,681			8,792		4.82		647,032			7,229		4.47
Installment	631,897			8,278		5.24		546,339			6,692		4.90
Tax-Exempt ⁽²⁾	465,658			4,597		3.95		328,322			3,834		4.67
Total Loans	6,975,737			89,260		5.12		5,436,961			63,220		4.65
Total Earning Assets	8,741,173			103,496		4.74		6,812,451			75,550		4.44
Net unrealized gain (loss) on securities available for sale	(13,068		)					4,908
Allowance for loan losses	(77,197		)					(69,068		)
Cash and cash equivalents	132,481							153,247
Premises and equipment	94,757							92,026
Other assets	818,874							578,225
Total Assets	$	9,697,020						$	7,571,789
Liabilities:
Interest-bearing deposits:
Interest-bearing NOW deposits	$	2,325,705		$	4,276	0.74	%	$	1,596,182		$	1,089	0.27	%
Money market deposits	1,081,830			1,583		0.59		901,077			600		0.27
Savings deposits	1,096,003			1,332		0.49		791,464			161		0.08
Certificates and other time deposits	1,491,207			4,974		1.33		1,281,132			3,287		1.03
Total Interest-bearing Deposits	5,994,745			12,165		0.81		4,569,855			5,137		0.45
Borrowings	674,040			4,135		2.45		618,335			3,230		2.09
Total Interest-bearing Liabilities	6,668,785			16,300		0.98		5,188,190			8,367		0.65
Noninterest-bearing deposits	1,642,076							1,360,677
Other liabilities	58,818							39,826
Total Liabilities	8,369,679							6,588,693
Stockholders' Equity	1,327,341							983,096
Total Liabilities and Stockholders' Equity	$	9,697,020		16,300				$	7,571,789		8,367
Net Interest Income (FTE)				$	87,196						$	67,183
Net Interest Spread (FTE)						3.76	%						3.79	%

Net Interest Margin (FTE):
Interest Income (FTE) / Average Earning Assets						4.74	%						4.44	%
Interest Expense / Average Earning Assets						0.75	%						0.49	%
Net Interest Margin (FTE)						3.99	%						3.95	%

⁽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.
⁽²⁾Tax-exempt securities and loans are presented on a fully taxable equivalent basis, using a marginal tax rate of 21 percent and 35 percent for 2018 and 2017, respectively. These totals equal $2,625 and $4,083 for the three months ended June 30, 2018 and 2017, respectively.
⁽³⁾ Non accruing loans have been included in the average balances.



NET INTEREST INCOME
(Dollars in Thousands)	For the Six Months Ended
	June 30, 2018							June 30, 2017
	Average Balance			Interest Income / Expense		Average Rate		Average Balance			Interest Income / Expense		Average Rate
Assets:
Interest-bearing time deposits	$	87,883		$	764	1.74	%	$	36,662		$	158	0.86	%
Federal Reserve and Federal Home Loan Bank stock	24,487			667		5.45		18,312			393		4.29
Investment Securities: ⁽¹⁾
Taxable	831,743			10,530		2.53		714,672			8,488		2.38
Tax-Exempt ⁽²⁾	741,096			15,661		4.23		591,401			15,529		5.25
Total Investment Securities	1,572,839			26,191		3.33		1,306,073			24,017		3.68
Loans held for sale	8,515			221		5.19		3,197			109		6.82
Loans: ⁽³⁾
Commercial	5,061,717			129,663		5.12		3,846,622			89,494		4.65
Real Estate Mortgage	729,202			16,791		4.61		596,990			13,350		4.47
Installment	627,686			16,255		5.18		539,272			12,790		4.74
Tax-Exempt ⁽²⁾	466,747			9,149		3.92		323,230			7,423		4.59
Total Loans	6,893,867			172,079		4.99		5,309,311			123,166		4.64
Total Earning Assets	8,579,076			199,701		4.66	%	6,670,358			147,734		4.43	%
Net unrealized gain on securities available for sale	(9,772		)					2,762
Allowance for loan losses	(76,528		)					(68,007		)
Cash and cash equivalents	129,499							128,768
Premises and equipment	95,139							92,519
Other assets	818,360							569,050
Total Assets	$	9,535,774						$	7,395,450
Liabilities:
Interest-bearing deposits:
Interest-bearing NOW deposits	$	2,153,878		$	6,965	0.65	%	$	1,554,740		$	1,926	0.25	%
Money market deposits	1,085,740			2,858		0.53		845,536			941		0.22
Savings deposits	1,021,386			1,714		0.34		784,033			317		0.08
Certificates and other time deposits	1,488,664			9,630		1.29		1,223,426			6,077		0.99
Total Interest-bearing Deposits	5,749,668			21,167		0.74		4,407,735			9,261		0.42
Borrowings	760,643			8,837		2.32		641,499			6,341		1.98
Total Interest-bearing Liabilities	6,510,311			30,004		0.92		5,049,234			15,602		0.62
Noninterest-bearing deposits	1,646,660							1,353,649
Other liabilities	60,679							43,798
Total Liabilities	8,217,650							6,446,681
Stockholders' Equity	1,318,124							948,769
Total Liabilities and Stockholders' Equity	$	9,535,774		30,004				$	7,395,450		15,602
Net Interest Income (FTE)				$	169,697						$	132,132
Net Interest Spread (FTE)						3.74	%						3.81	%

Net Interest Margin (FTE):
Interest Income (FTE) / Average Earning Assets						4.66	%						4.43	%
Interest Expense / Average Earning Assets						0.70	%						0.47	%
Net Interest Margin (FTE)						3.96	%						3.96	%

⁽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.
(2) Tax-exempt securities and loans are presented on a fully taxable equivalent basis, using a marginal tax rate of 21 percent and 35 percent for 2018 and 2017, respectively. These totals equal $5,210 and $8,033 for the six months ended June 30, 2018 and 2017, respectively.
⁽³⁾ Non accruing loans have been included in the average balances.