0000712534false00007125342024-10-242024-10-240000712534us-gaap:CommonStockMember2024-10-242024-10-240000712534frme:DepositarySharesMember2024-10-242024-10-24


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): October 24, 2024

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 October 24, 2024, First Merchants Corporation issued a press release to report its financial results for the third quarter ended September 30, 2024. 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 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: October 24, 2024



EXHIBIT INDEX

Exhibit No.    Description



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





N / E / W / S R / E / L / E / A / S / E
    
October 24, 2024

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 THIRD QUARTER 2024 EARNINGS PER SHARE

First Merchants Corporation (NASDAQ - FRME)

Third Quarter 2024 Highlights:

•    Net income available to common stockholders was $48.7 million and diluted earnings per common share totaled $0.84, compared to $55.9 million and $0.94 in the third quarter of 2023, and $39.5 million and $0.68 in the second quarter of 2024. Excluding the loss from repositioning of the available for sale securities portfolio, adjusted net income was $55.6 million or $0.95 per share for the third quarter of 2024.
•    Strong capital position with Common Equity Tier 1 Capital Ratio of 11.25% and Tangible Common Equity to Tangible Assets Ratio of 8.76%.
•    Net interest margin was 3.23% compared to 3.16% on a linked quarter basis.
•    Total loans grew $15.5 million, or 0.5% annualized, on a linked quarter basis, and $385.1 million, or 3.1% during the last twelve months.
•    Total deposits grew by $83.7 million, or 2.3% annualized, on a linked quarter basis after normalizing for $287.7 million of deposits reclassified to held for sale.
•    Nonperforming assets to total assets were 35 basis points compared to 36 basis points on a linked quarter basis.
•The efficiency ratio totaled 53.76% for the quarter.
•Announced sale of five Illinois branches and certain loans and deposits to Old Second National Bank on August 27, 2024.

“We are pleased with our third quarter results and the focused momentum that we are building,” said Mark Hardwick, Chief Executive Officer. "The pending sale of five non-core Illinois branches, restructure of the securities portfolio, and successful completion of four major technology initiatives provides us with the opportunity to reprioritize our core markets and introduce innovative customer acquisition strategies.”

Third Quarter Financial Results:

First Merchants Corporation (the “Corporation”) has reported third quarter 2024 net income available to common stockholders of $48.7 million compared to $55.9 million during the same period in 2023. Diluted earnings per common share for the period totaled $0.84 compared to the third quarter of 2023 result of $0.94. Excluding the $9.1 million pre-tax loss from repositioning of the available for sale securities portfolio, adjusted net income was $55.6 million, or $0.95 diluted earnings per common share for the third quarter of 2024.

During the quarter, the Corporation signed a definitive agreement to sell five Illinois branches along with certain loans and deposits, representing an exit from suburban Chicago markets. Loans of $9.2 million, deposits of $287.7 million and fixed assets of $3.4 million have been moved to held for sale categories as of September 30, 2024. The transaction is expected to close in the fourth quarter of this year.

Total assets equaled $18.3 billion as of quarter-end and loans totaled $12.7 billion. During the past twelve months, total loans grew by $385.1 million, or 3.1%. On a linked quarter basis, loans grew $15.5 million, or 0.5%, with growth primarily in commercial & industrial loans.





Investments totaling $3.7 billion decreased $51.6 million, or 1.4%, during the last twelve months and decreased $90.9 million, or 9.7% annualized, on a linked quarter basis. The decline during the quarter was due to $158.9 million in sales of available for sale securities with a weighted average tax-equivalent yield of 2.85%, partially offset by an increase in the securities portfolio valuation.

Total deposits were $14.4 billion as of quarter-end and decreased by $281.5 million, or 1.9%, over the past twelve months. The decline was primarily due to $287.7 million of deposits being reclassified to held for sale. Excluding this impact, deposits increased by $6.2 million. On a linked quarter basis, deposits grew organically by $83.7 million or 2.3%. The loan to deposit ratio increased to 88.0% at period end from 86.8% in the prior quarter, primarily due to the reclassification of deposits to held for sale as previously described.

The Corporation’s Allowance for Credit Losses – Loans (ACL) totaled $187.8 million as of quarter-end, or 1.48% of total loans, a decrease of $1.7 million from prior quarter. Loan charge-offs, net of recoveries totaled $6.7 million and provision for loans of $5.0 million was recorded during the quarter. Reserves for unfunded commitments totaled $19.5 million and remained unchanged from the prior quarter. Non-performing assets to total assets were 35 basis points for the third quarter of 2024, a decrease of one basis point compared to 36 basis points in the prior quarter.

Net interest income totaled $131.1 million for the quarter, an increase of $2.5 million, or 2.0%, compared to prior quarter and a decrease of $2.3 million, or 1.7%, compared to the third quarter of 2023. Fully-tax equivalent net interest margin was 3.23%, an increase of 7 basis points compared to the second quarter of 2024, and a decrease of 6 basis points compared to the third quarter of 2023. The increase in net interest margin compared to the second quarter was due to higher earning asset yields.

Non-interest income totaled $24.9 million for the quarter, a decrease of $6.5 million, or 20.6%, compared to the second quarter of 2024 and a decrease of $3.0 million, or 6.7% from the third quarter of 2023. The decrease from second quarter of 2024 was driven by realized losses on sales of available for sale securities associated with the repositioning of the bond portfolio, partially offset by increases in gains on sales of mortgage loans and earnings on cash surrender value of life insurance.

Non-interest expense totaled $94.6 million for the quarter, an increase of $3.2 million from the second quarter of 2024 and an increase of $0.8 million from the third quarter of 2023. The increase from the linked quarter was from higher salaries and employee benefits primarily driven by higher incentives.

The Corporation’s total risk-based capital ratio equaled 13.18%, common equity tier 1 capital ratio equaled 11.25%, and the tangible common equity ratio totaled 8.76%. These ratios continue to reflect the Corporation’s strong liquidity and capital positions.











CONFERENCE CALL

First Merchants Corporation will conduct a third quarter earnings conference call and web cast at 11:30 a.m. (ET) on Thursday, October 24, 2024.

To access via phone, participants will need to register using the following link where they will be provided a phone number and access code: (https://register.vevent.com/register/BI34430e309ed545808c7c8195f36e86b6)

To view the webcast and presentation slides, please go to (https://edge.media-server.com/mmc/p/6grv3upw) during the time of the call. A replay of the webcast will be available until October 24, 2025.

Detailed financial results are reported on the attached pages.

About First Merchants Corporation

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

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

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

Forward-Looking Statements

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





CONSOLIDATED BALANCE SHEETS
(Dollars In Thousands)September 30,
20242023
ASSETS
Cash and due from banks$84,719 $125,173 
Interest-bearing deposits359,126 348,639 
Investment securities, net of allowance for credit losses of $245,000 and $245,0003,662,145 3,713,724 
Loans held for sale40,652 30,972 
Loans12,646,808 12,271,422 
Less: Allowance for credit losses - loans(187,828)(205,782)
Net loans12,458,980 12,065,640 
Premises and equipment129,582 132,441 
Federal Home Loan Bank stock41,716 41,797 
Interest receivable92,055 90,011 
Goodwill and other intangibles733,601 741,283 
Cash surrender value of life insurance304,613 306,106 
Other real estate owned5,247 6,480 
Tax asset, deferred and receivable86,732 135,521 
Other assets348,384 340,476 
TOTAL ASSETS$18,347,552 $18,078,263 
LIABILITIES
Deposits:
Noninterest-bearing$2,334,197 $2,554,984 
Interest-bearing12,030,903 12,091,592 
Total Deposits14,365,100 14,646,576 
Borrowings:
Federal funds purchased30,000 — 
Securities sold under repurchase agreements124,894 152,537 
Federal Home Loan Bank advances832,629 713,384 
Subordinated debentures and other borrowings93,562 158,665 
Total Borrowings1,081,085 1,024,586 
Deposits and other liabilities held for sale288,476 — 
Interest payable18,089 16,473 
Other liabilities292,429 297,984 
Total Liabilities16,045,179 15,985,619 
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 - 58,117,115 and 59,398,022 shares7,265 7,425 
Additional paid-in capital1,192,683 1,234,402 
Retained earnings1,229,125 1,132,962 
Accumulated other comprehensive loss(151,825)(307,270)
Total Stockholders' Equity2,302,373 2,092,644 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY$18,347,552 $18,078,263 








CONSOLIDATED STATEMENTS OF INCOMEThree Months EndedNine Months Ended
(Dollars In Thousands, Except Per Share Amounts)September 30,September 30,
2024202320242023
INTEREST INCOME
Loans receivable:
Taxable$206,680 $191,705 $606,116 $550,314 
Tax-exempt8,622 8,288 25,242 23,757 
Investment securities:
Taxable9,263 8,590 27,062 26,563 
Tax-exempt13,509 13,947 40,733 44,296 
Deposits with financial institutions2,154 5,884 11,642 9,685 
Federal Home Loan Bank stock855 719 2,569 2,281 
Total Interest Income241,083 229,133 713,364 656,896 
INTEREST EXPENSE
Deposits98,856 85,551 296,292 209,437 
Federal funds purchased329 — 455 1,420 
Securities sold under repurchase agreements700 797 2,377 2,624 
Federal Home Loan Bank advances8,544 6,896 21,715 20,775 
Subordinated debentures and other borrowings1,544 2,506 5,781 7,303 
Total Interest Expense109,973 95,750 326,620 241,559 
NET INTEREST INCOME131,110 133,383 386,744 415,337 
Provision for credit losses5,000 2,000 31,500 2,000 
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES126,110 131,383 355,244 413,337 
NONINTEREST INCOME
Service charges on deposit accounts8,361 7,975 24,482 23,147 
Fiduciary and wealth management fees8,525 7,394 25,550 22,653 
Card payment fees5,121 4,716 14,360 14,425 
Net gains and fees on sales of loans6,764 5,517 15,159 11,548 
Derivative hedge fees736 516 1,488 2,336 
Other customer fees344 384 1,231 1,643 
Earnings on cash surrender value of life insurance2,755 1,761 6,276 5,145 
Net realized losses on sales of available for sale securities(9,114)(1,650)(9,165)(4,613)
Other income1,374 1,229 3,457 2,874 
Total Noninterest Income24,866 27,842 82,838 79,158 
NONINTEREST EXPENSES
Salaries and employee benefits55,223 55,566 165,730 167,778 
Net occupancy6,994 6,837 21,052 20,770 
Equipment6,949 5,698 19,774 18,005 
Marketing1,836 2,369 4,807 4,780 
Outside data processing fees7,150 6,573 21,111 19,290 
Printing and office supplies378 333 1,085 1,150 
Intangible asset amortization1,772 2,182 5,500 6,561 
FDIC assessments3,720 2,981 11,285 7,117 
Other real estate owned and foreclosure expenses942 677 1,849 1,575 
Professional and other outside services3,035 3,833 10,809 12,191 
Other expenses6,630 6,805 19,975 20,950 
Total Noninterest Expenses94,629 93,854 282,977 280,167 
INCOME BEFORE INCOME TAX56,347 65,371 155,105 212,328 
Income tax expense7,160 9,005 18,052 31,021 
NET INCOME49,187 56,366 137,053 181,307 
Preferred stock dividends468 468 1,406 1,406 
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS$48,719 $55,898 $135,647 $179,901 
Per Share Data:
Basic Net Income Available to Common Stockholders$0.84 $0.95 $2.32 $3.04 
Diluted Net Income Available to Common Stockholders$0.84 $0.94 $2.31 $3.03 
Cash Dividends Paid to Common Stockholders$0.35 $0.34 $1.04 $1.00 
Average Diluted Common Shares Outstanding (in thousands)58,289 59,503 58,629 59,465 





FINANCIAL HIGHLIGHTS
(Dollars in thousands)Three Months EndedNine Months Ended
September 30,September 30,
2024202320242023
NET CHARGE-OFFS$6,709 $20,365 $48,606 $22,495 
AVERAGE BALANCES:
Total Assets$18,360,580 $18,152,239 $18,374,370 $18,115,504 
Total Loans12,680,166 12,287,632 12,592,907 12,264,787 
Total Earning Assets16,990,358 16,947,669 17,042,540 16,913,965 
Total Deposits14,702,454 14,735,592 14,826,056 14,627,448 
Total Stockholders' Equity2,251,547 2,154,232 2,232,419 2,126,005 
FINANCIAL RATIOS:
Return on Average Assets1.07 %1.24 %0.99 %1.33 %
Return on Average Stockholders' Equity8.66 10.38 8.10 11.28 
Return on Tangible Common Stockholders' Equity13.39 16.54 12.64 18.10 
Average Earning Assets to Average Assets92.54 93.36 92.75 93.37 
Allowance for Credit Losses - Loans as % of Total Loans1.48 1.67 1.48 1.67 
Net Charge-offs as % of Average Loans (Annualized)0.21 0.66 0.51 0.24 
Average Stockholders' Equity to Average Assets12.26 11.87 12.15 11.74 
Tax Equivalent Yield on Average Earning Assets5.82 5.55 5.72 5.32 
Interest Expense/Average Earning Assets2.59 2.26 2.56 1.90 
Net Interest Margin (FTE) on Average Earning Assets3.23 3.29 3.16 3.42 
Efficiency Ratio53.76 53.91 55.54 52.60 
Tangible Common Book Value Per Share$26.64 $22.43 $26.64 $22.43 

NONPERFORMING ASSETS
(Dollars In Thousands)September 30,June 30,March 31,December 31,September 30,
20242024202420232023
Nonaccrual Loans$59,088 $61,906 $62,478 $53,580 $53,102 
Other Real Estate Owned and Repossessions5,247 4,824 4,886 4,831 6,480 
Nonperforming Assets (NPA)64,335 66,730 67,364 58,411 59,582 
90+ Days Delinquent14,105 1,686 2,838 172 89 
NPAs & 90 Day Delinquent$78,440 $68,416 $70,202 $58,583 $59,671 
Allowance for Credit Losses - Loans$187,828 $189,537 $204,681 $204,934 $205,782 
Quarterly Net Charge-offs6,709 39,644 2,253 3,148 20,365 
NPAs / Actual Assets %0.35 %0.36 %0.37 %0.32 %0.33 %
NPAs & 90 Day / Actual Assets %0.43 %0.37 %0.38 %0.32 %0.33 %
NPAs / Actual Loans and OREO %0.51 %0.53 %0.54 %0.47 %0.48 %
Allowance for Credit Losses - Loans / Actual Loans (%)1.48 %1.50 %1.64 %1.64 %1.67 %
Net Charge-offs as % of Average Loans (Annualized)0.21 %1.26 %0.07 %0.10 %0.66 %





CONSOLIDATED BALANCE SHEETS
(Dollars In Thousands)September 30,June 30,March 31,December 31,September 30,
20242024202420232023
ASSETS
Cash and due from banks$84,719 $105,372 $100,514 $112,649 $125,173 
Interest-bearing deposits359,126 168,528 410,497 436,080 348,639 
Investment securities, net of allowance for credit losses3,662,145 3,753,088 3,783,574 3,811,364 3,713,724 
Loans held for sale40,652 32,292 15,118 18,934 30,972 
Loans12,646,808 12,639,650 12,465,582 12,486,027 12,271,422 
Less: Allowance for credit losses - loans(187,828)(189,537)(204,681)(204,934)(205,782)
Net loans12,458,980 12,450,113 12,260,901 12,281,093 12,065,640 
Premises and equipment129,582 133,245 132,706 133,896 132,441 
Federal Home Loan Bank stock41,716 41,738 41,758 41,769 41,797 
Interest receivable92,055 97,546 92,550 97,664 90,011 
Goodwill and other intangibles733,601 735,373 737,144 739,101 741,283 
Cash surrender value of life insurance304,613 306,379 306,028 306,301 306,106 
Other real estate owned5,247 4,824 4,886 4,831 6,480 
Tax asset, deferred and receivable86,732 107,080 101,121 99,883 135,521 
Other assets348,384 367,845 331,006 322,322 340,476 
TOTAL ASSETS$18,347,552 $18,303,423 $18,317,803 $18,405,887 $18,078,263 
LIABILITIES
Deposits:
Noninterest-bearing$2,334,197 $2,303,313 $2,338,364 $2,500,062 $2,554,984 
Interest-bearing12,030,903 12,265,757 12,546,220 12,321,391 12,091,592 
Total Deposits14,365,100 14,569,070 14,884,584 14,821,453 14,646,576 
Borrowings:
Federal funds purchased30,000 147,229 — — — 
Securities sold under repurchase agreements124,894 100,451 130,264 157,280 152,537 
Federal Home Loan Bank advances832,629 832,703 612,778 712,852 713,384 
Subordinated debentures and other borrowings93,562 93,589 118,612 158,644 158,665 
Total Borrowings1,081,085 1,173,972 861,654 1,028,776 1,024,586 
Deposits and other liabilities held for sale288,476 — — — — 
Interest payable18,089 18,554 19,262 18,912 16,473 
Other liabilities292,429 329,302 327,500 289,033 297,984 
Total Liabilities16,045,179 16,090,898 16,093,000 16,158,174 15,985,619 
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 outstanding7,265 7,256 7,321 7,428 7,425 
Additional paid-in capital1,192,683 1,191,193 1,208,447 1,236,506 1,234,402 
Retained earnings1,229,125 1,200,930 1,181,939 1,154,624 1,132,962 
Accumulated other comprehensive loss(151,825)(211,979)(198,029)(175,970)(307,270)
Total Stockholders' Equity2,302,373 2,212,525 2,224,803 2,247,713 2,092,644 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY$18,347,552 $18,303,423 $18,317,803 $18,405,887 $18,078,263 









CONSOLIDATED STATEMENTS OF INCOME
(Dollars In Thousands, Except Per Share Amounts)September 30,June 30,March 31,December 31,September 30,
20242024202420232023
INTEREST INCOME
Loans receivable:
Taxable$206,680 $201,413 $198,023 $197,523 $191,705 
Tax-exempt8,622 8,430 8,190 8,197 8,288 
Investment securities:
Taxable9,263 9,051 8,748 8,644 8,590 
Tax-exempt13,509 13,613 13,611 13,821 13,947 
Deposits with financial institutions2,154 2,995 6,493 8,034 5,884 
Federal Home Loan Bank stock855 879 835 771 719 
Total Interest Income241,083 236,381 235,900 236,990 229,133 
INTEREST EXPENSE
Deposits98,856 99,151 98,285 96,655 85,551 
Federal funds purchased329 126 — 1 — 
Securities sold under repurchase agreements700 645 1,032 827 797 
Federal Home Loan Bank advances8,544 6,398 6,773 6,431 6,896 
Subordinated debentures and other borrowings1,544 1,490 2,747 3,013 2,506 
Total Interest Expense109,973 107,810 108,837 106,927 95,750 
NET INTEREST INCOME131,110 128,571 127,063 130,063 133,383 
Provision for credit losses5,000 24,500 2,000 1,500 2,000 
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES126,110 104,071 125,063 128,563 131,383 
NONINTEREST INCOME
Service charges on deposit accounts8,361 8,214 7,907 7,690 7,975 
Fiduciary and wealth management fees8,525 8,825 8,200 8,187 7,394 
Card payment fees5,121 4,739 4,500 4,437 4,716 
Net gains and fees on sales of loans6,764 5,141 3,254 4,111 5,517 
Derivative hedge fees736 489 263 1,049 516 
Other customer fees344 460 427 237 384 
Earnings on cash surrender value of life insurance2,755 1,929 1,592 3,202 1,761 
Net realized losses on sales of available for sale securities(9,114)(49)(2)(2,317)(1,650)
Other income (loss)1,374 1,586 497 (152)1,229 
Total Noninterest Income24,866 31,334 26,638 26,444 27,842 
NONINTEREST EXPENSES
Salaries and employee benefits55,223 52,214 58,293 60,967 55,566 
Net occupancy6,994 6,746 7,312 9,089 6,837 
Equipment6,949 6,599 6,226 6,108 5,698 
Marketing1,836 1,773 1,198 2,647 2,369 
Outside data processing fees7,150 7,072 6,889 5,875 6,573 
Printing and office supplies378 354 353 402 333 
Intangible asset amortization1,772 1,771 1,957 2,182 2,182 
FDIC assessments3,720 3,278 4,287 7,557 2,981 
Other real estate owned and foreclosure expenses942 373 534 1,743 677 
Professional and other outside services3,035 3,822 3,952 3,981 3,833 
Other expenses6,630 7,411 5,934 7,552 6,805 
Total Noninterest Expenses94,629 91,413 96,935 108,103 93,854 
INCOME BEFORE INCOME TAX56,347 43,992 54,766 46,904 65,371 
Income tax expense7,160 4,067 6,825 4,425 9,005 
NET INCOME49,187 39,925 47,941 42,479 56,366 
Preferred stock dividends468 469 469 469 468 
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS$48,719 $39,456 $47,472 $42,010 $55,898 
Per Share Data:
Basic Net Income Available to Common Stockholders$0.84 $0.68 $0.80 $0.71 $0.95 
Diluted Net Income Available to Common Stockholders$0.84 $0.68 $0.80 $0.71 $0.94 
Cash Dividends Paid to Common Stockholders$0.35 $0.35 $0.34 $0.34 $0.34 
Average Diluted Common Shares Outstanding (in thousands)58,289 58,328 59,273 59,556 59,503 
FINANCIAL RATIOS:
Return on Average Assets1.07 %0.87 %1.04 %0.92 %1.24 %
Return on Average Stockholders' Equity8.66 7.16 8.47 7.89 10.38 
Return on Tangible Common Stockholders' Equity13.39 11.29 13.21 12.75 16.54 
Average Earning Assets to Average Assets92.54 92.81 92.91 93.62 93.36 
Allowance for Credit Losses - Loans as % of Total Loans1.48 1.50 1.64 1.64 1.67 
Net Charge-offs as % of Average Loans (Annualized)0.21 1.26 0.07 0.10 0.66 
Average Stockholders' Equity to Average Assets12.26 12.02 12.17 11.58 11.87 
Tax Equivalent Yield on Average Earning Assets5.82 5.69 5.65 5.64 5.55 
Interest Expense/Average Earning Assets2.59 2.53 2.55 2.48 2.26 
Net Interest Margin (FTE) on Average Earning Assets3.23 3.16 3.10 3.16 3.29 
Efficiency Ratio53.76 53.84 59.21 63.26 53.91 
Tangible Common Book Value Per Share$26.64 $25.10 $25.07 $25.06 $22.43 





LOANS
(Dollars In Thousands)September 30,June 30,March 31,December 31,September 30,
20242024202420232023
Commercial and industrial loans$4,041,217 $3,949,817 $3,722,365 $3,670,948 $3,490,953 
Agricultural land, production and other loans to farmers238,743 239,926 234,431 263,414 233,838 
Real estate loans:
Construction814,704 823,267 941,726 957,545 1,022,261 
Commercial real estate, non-owner occupied2,251,351 2,323,533 2,368,360 2,400,839 2,360,596 
Commercial real estate, owner occupied1,152,751 1,174,195 1,137,894 1,162,083 1,153,707 
Residential2,366,943 2,370,905 2,316,490 2,288,921 2,257,385 
Home equity641,188 631,104 618,258 617,571 609,352 
Individuals' loans for household and other personal expenditures158,480 162,089 161,459 168,388 176,523 
Public finance and other commercial loans981,431 964,814 964,599 956,318 966,807 
Loans12,646,808 12,639,650 12,465,582 12,486,027 12,271,422 
Allowance for credit losses - loans(187,828)(189,537)(204,681)(204,934)(205,782)
NET LOANS$12,458,980 $12,450,113 $12,260,901 $12,281,093 $12,065,640 

DEPOSITS
(Dollars In Thousands)September 30,June 30,March 31,December 31,September 30,
20242024202420232023
Demand deposits$7,678,510 $7,757,679 $7,771,976 $7,965,862 $7,952,040 
Savings deposits4,302,236 4,339,161 4,679,593 4,516,433 4,572,162 
Certificates and other time deposits of $100,000 or more1,277,833 1,415,131 1,451,443 1,408,985 1,280,607 
Other certificates and time deposits802,949 889,949 901,280 849,906 761,196 
Brokered certificates of deposits1
303,572 167,150 80,292 80,267 80,571 
TOTAL DEPOSITS2
$14,365,100 $14,569,070 $14,884,584 $14,821,453 $14,646,576 
1 - Total brokered deposits of $838.3 million, which includes brokered CD's of $303.6 million at September 30, 2024.
2 - Total deposits at September 30, 2024 excludes $287.7 million of deposits reclassified to Deposits and other liabilities held for sale related to the pending Illinois branch sale.






CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST MARGIN ANALYSIS
(Dollars in Thousands)
For the Three Months Ended
September 30, 2024September 30, 2023
Average BalanceInterest
 Income /
Expense		Average
Rate		Average BalanceInterest
 Income /
Expense		Average
Rate
ASSETS
Interest-bearing deposits$252,113 $2,154 3.42 %$502,967 $5,884 4.68 %
Federal Home Loan Bank stock41,730 855 8.20 41,826 719 6.88 
Investment Securities: (1)
Taxable1,789,526 9,263 2.07 1,817,219 8,590 1.89 
Tax-exempt (2)
2,226,823 17,100 3.07 2,298,025 17,655 3.07 
Total Investment Securities4,016,349 26,363 2.63 4,115,244 26,245 2.55 
Loans held for sale31,991 483 6.04 24,227 386 6.37 
Loans: (3)
Commercial8,699,733 164,922 7.58 8,456,527 153,993 7.28 
Real estate mortgage2,183,095 24,333 4.46 2,079,067 21,618 4.16 
Installment832,222 16,942 8.14 827,318 15,708 7.59 
Tax-exempt (2)
933,125 10,914 4.68 900,493 10,491 4.66 
Total Loans12,680,166 217,594 6.86 12,287,632 202,196 6.58 
Total Earning Assets16,990,358 246,966 5.82 %16,947,669 235,044 5.55 %
Total Non-Earning Assets1,370,222 1,204,570 
TOTAL ASSETS$18,360,580 $18,152,239 
LIABILITIES
Interest-Bearing Deposits:
Interest-bearing deposits$5,455,298 $40,450 2.97 %$5,425,829 $37,780 2.79 %
Money market deposits2,974,188 25,950 3.49 2,923,798 23,607 3.23 
Savings deposits1,425,047 4,208 1.18 1,641,338 3,844 0.94 
Certificates and other time deposits2,499,655 28,248 4.52 2,106,910 20,320 3.86 
Total Interest-Bearing Deposits12,354,188 98,856 3.20 12,097,875 85,551 2.83 
Borrowings1,071,440 11,117 4.15 1,032,180 10,199 3.95 
Total Interest-Bearing Liabilities13,425,628 109,973 3.28 13,130,055 95,750 2.92 
Noninterest-bearing deposits2,348,266 2,637,717 
Other liabilities335,139 230,235 
Total Liabilities16,109,033 15,998,007 
STOCKHOLDERS' EQUITY2,251,547 2,154,232 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY$18,360,580 109,973 $18,152,239 95,750 
Net Interest Income (FTE)$136,993 $139,294 
Net Interest Spread (FTE) (4)
2.54 %2.63 %
Net Interest Margin (FTE):
Interest Income (FTE) / Average Earning Assets5.82 %5.55 %
Interest Expense / Average Earning Assets2.59 %2.26 %
Net Interest Margin (FTE) (5)
3.23 %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 2024 and 2023. These totals equal $5,883 and $5,911 for the three months ended September 30, 2024 and 2023, respectively.
(3) Non accruing loans have been included in the average balances.
(4) Net Interest Spread (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average interest-bearing liabilities.
(5) Net Interest Margin (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average earning assets.













CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST MARGIN ANALYSIS
(Dollars in Thousands)
For the Nine Months Ended
September 30, 2024September 30, 2023
Average BalanceInterest
 Income /
Expense		Average
Rate		Average BalanceInterest
 Income /
Expense		Average
Rate
Assets:
Interest-bearing deposits$383,007 $11,642 4.05 %$340,887 $9,685 3.79 %
Federal Home Loan Bank stock41,748 2,569 8.20 41,160 2,281 7.39 
Investment Securities: (1)
Taxable1,787,119 27,062 2.02 1,872,267 26,563 1.89 
Tax-exempt (2)
2,237,759 51,561 3.07 2,394,864 56,071 3.12 
Total Investment Securities4,024,878 78,623 2.60 4,267,131 82,634 2.58 
Loans held for sale27,735 1,242 5.97 22,398 1,046 6.23 
Loans: (3)
Commercial8,659,088 484,979 7.47 8,515,148 444,422 6.96 
Real estate mortgage2,159,738 70,489 4.35 2,008,852 60,354 4.01 
Installment825,060 49,406 7.98 833,133 44,492 7.12 
Tax-exempt (2)
921,286 31,952 4.62 885,256 30,072 4.53 
Total Loans12,592,907 638,068 6.76 12,264,787 580,386 6.31 
Total Earning Assets17,042,540 730,902 5.72 %16,913,965 674,986 5.32 %
Total Non-Earning Assets1,331,830 1,201,539 
Total Assets$18,374,370 $18,115,504 
Liabilities:
Interest-Bearing deposits:
Interest-bearing deposits$5,487,106 $120,935 2.94 %$5,412,482 $97,016 2.39 %
Money market deposits3,018,526 80,563 3.56 2,812,891 55,868 2.65 
Savings deposits1,497,620 11,485 1.02 1,730,110 10,693 0.82 
Certificates and other time deposits2,447,684 83,309 4.54 1,821,408 45,860 3.36 
Total Interest-Bearing Deposits12,450,936 296,292 3.17 11,776,891 209,437 2.37 
Borrowings990,022 30,328 4.08 1,144,368 32,122 3.74 
Total Interest-Bearing Liabilities13,440,958 326,620 3.24 12,921,259 241,559 2.49 
Noninterest-bearing deposits2,375,120 2,850,557 
Other liabilities325,873 217,683 
Total Liabilities16,141,951 15,989,499 
Stockholders' Equity2,232,419 2,126,005 
Total Liabilities and Stockholders' Equity$18,374,370 326,620 $18,115,504 241,559 
Net Interest Income (FTE)$404,282 $433,427 
Net Interest Spread (FTE) (4)
2.48 %2.83 %
Net Interest Margin (FTE):
Interest Income (FTE) / Average Earning Assets5.72 %5.32 %
Interest Expense / Average Earning Assets2.56 %1.90 %
Net Interest Margin (FTE) (5)
3.16 %3.42 %
(1) Average balance of securities is computed based on the average of the historical amortized cost balances without the effects of the fair value adjustments. Annualized amounts are computed using a 30/360 day basis.
(2) Tax-exempt securities and loans are presented on a fully taxable equivalent basis, using a marginal tax rate of 21 percent for 2024 and 2023. These totals equal $17,538 and $18,090 for the nine months ended September 30, 2024 and 2023, respectively.
(3) Non accruing loans have been included in the average balances.
(4) Net Interest Spread (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average interest-bearing liabilities.
(5) Net Interest Margin (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average earning assets.






ADJUSTED NET INCOME AND DILUTED EARNINGS PER COMMON SHARE - NON-GAAP
(Dollars In Thousands, Except Per Share Amounts)Three Months EndedNine Months Ended
September 30,June 30,March 31,December 31,September 30,September 30,September 30,
2024202420242023202320242023
Net Income Available to Common Stockholders - GAAP$48,719 $39,456 $47,472 $42,010 $55,898 $135,647 $179,901 
Adjustments:
PPP loan income— — — (7)(8)— (42)
Net realized losses on sales of available for sale securities9,114 49 2 2,317 1,650 9,165 4,613 
Non-core expenses1,2
— — 3,481 12,682 — 3,481 — 
Tax on adjustments(2,220)(12)(848)(3,652)(403)(3,081)(1,121)
Adjusted Net Income Available to Common Stockholders - Non-GAAP$55,613 $39,493 $50,107 $53,350 $57,137 $145,212 $183,351 
Average Diluted Common Shares Outstanding (in thousands)58,289 58,328 59,273 59,556 59,503 58,629 59,465 
Diluted Earnings Per Common Share - GAAP$0.84 $0.68 $0.80 $0.71 $0.94 $2.31 $3.03 
Adjustments:
PPP loan income— — — — — — — 
Net realized losses on sales of available for sale securities0.15 — — 0.04 0.03 0.16 0.07 
Non-core expenses1,2
— — 0.06 0.21 — 0.06 — 
Tax on adjustments(0.04)— (0.01)(0.06)(0.01)(0.05)(0.02)
Adjusted Diluted Earnings Per Common Share - Non-GAAP$0.95 $0.68 $0.85 $0.90 $0.96 $2.48 $3.08 
1 - Non-core expenses in 4Q23 included $6.3 million from early retirement and severance costs, $4.3 million from the FDIC special assessment, and $2.1 million from a lease termination.
2 - Non-core expenses in 1Q24 included $2.4 million from duplicative online banking conversion costs and $1.1 million from the FDIC special assessment.
NET INTEREST MARGIN ("NIM"), ADJUSTED
(Dollars in Thousands, Except Per Share Amounts)
Three Months EndedNine Months Ended
September 30,June 30,March 31,December 31,September 30,September 30,September 30,
2024202420242023202320242023
Net Interest Income (GAAP)$131,110 $128,571 $127,063 $130,063 $133,383 $386,744 $415,337 
Fully Taxable Equivalent ("FTE") Adjustment5,883 5,859 5,795 5,853 5,911 17,538 18,090 
Net Interest Income (FTE) (non-GAAP)$136,993 $134,430 $132,858 $135,916 $139,294 $404,282 $433,427 
Average Earning Assets (GAAP)$16,990,358 $17,013,984 $17,123,851 $17,222,714 $16,947,669 $17,042,540 $16,913,965 
Net Interest Margin (GAAP)3.09 %3.02 %2.97 %3.02 %3.15 %3.03 %3.27 %
Net Interest Margin (FTE) (non-GAAP)3.23 %3.16 %3.10 %3.16 %3.29 %3.16 %3.42 %
RETURN ON TANGIBLE COMMON EQUITY - NON-GAAP
(Dollars In Thousands)Three Months EndedNine Months Ended
September 30,June 30,March 31,December 31,September 30,September 30,September 30,
2024202420242023202320242023
Total Average Stockholders' Equity (GAAP)$2,251,547 $2,203,361 $2,242,139 $2,130,993 $2,154,232 $2,232,419 $2,126,005 
Less: Average Preferred Stock(25,125)(25,125)(25,125)(25,125)(25,125)(25,125)(25,125)
Less: Average Intangible Assets, Net of Tax(729,581)(730,980)(732,432)(734,007)(735,787)(730,993)(737,476)
Average Tangible Common Equity, Net of Tax (Non-GAAP)$1,496,841 $1,447,256 $1,484,582 $1,371,861 $1,393,320 $1,476,301 $1,363,404 
Net Income Available to Common Stockholders (GAAP)$48,719 $39,456 $47,472 $42,010 $55,898 $135,647 $179,901 
Plus: Intangible Asset Amortization, Net of Tax1,399 1,399 1,546 1,724 1,724 4,345 5,182 
Tangible Net Income (Non-GAAP)$50,118 $40,855 $49,018 $43,734 $57,622 $139,992 $185,083 
Return on Tangible Common Equity (Non-GAAP)13.39 %11.29 %13.21 %12.75 %16.54 %12.64 %18.10 %

v3.24.3
Document and Entity Information Document
Oct. 24, 2024
Entity Listings [Line Items]  
Document Type 8-K
Document Period End Date Oct. 24, 2024
Entity Registrant Name FIRST MERCHANTS CORP
Entity Incorporation, State or Country Code IN
Entity File Number 001-41342
Entity Tax Identification Number 35-1544218
Entity Address, Address Line One 200 East Jackson Street
Entity Address, Address Line Two P.O. Box 792
Entity Address, City or Town Muncie
Entity Address, State or Province IN
Entity Address, Postal Zip Code 47305-2814
City Area Code 765
Local Phone Number 747-1500
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company false
Entity Central Index Key 0000712534
Amendment Flag false
Common Stock, $0.125 stated value per share  
Entity Listings [Line Items]  
Title of 12(b) Security Common Stock, $0.125 stated value per share
Trading Symbol FRME
Security Exchange Name NASDAQ
Depositary Shares, each representing a 1/100th interest in a share of Non-Cumulative Perpetual Preferred Stock, Series A  
Entity Listings [Line Items]  
Title of 12(b) Security Depositary Shares, each representing a 1/100th interest in a share of Non-Cumulative Perpetual Preferred Stock, Series A
Trading Symbol FRMEP
Security Exchange Name NASDAQ
First Merchants (NASDAQ:FRMEP)
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