• First Merchants Corporation Announces Third Quarter 2021 Earnings Per Share

    ソース: Nasdaq GlobeNewswire / 26 10 2021 08:00:04   America/New_York

    MUNCIE, Ind., Oct. 26, 2021 (GLOBE NEWSWIRE) -- First Merchants Corporation (NASDAQ - FRME) has reported third quarter 2021 net income of $52.8 million compared to $36.2 million during the same period in 2020, an increase of 45.7 percent. Earnings per share for the period totaled $.98 per share compared to the third quarter of 2020 result of $.67 per share. Year-to-date net income totaled $157.8 million compared to $103.5 million during the nine months ended September 30, 2020, an increase of 52.5 percent. Year-to-date earnings per share totaled $2.92 compared to $1.91 during the same period in 2020.

    Total assets equaled $15.1 billion as of September 30, 2021 and loans totaled $9.0 billion. The Corporation experienced organic loan growth of $503.9 million, or 6.0 percent during the last twelve months, offset by the forgiveness of Paycheck Protection Program (“PPP”) loans which accounted for a decline of $703.3 million. As a result, the loan portfolio decreased by $199.5 million, or 2.2 percent, during that period. Organic loan growth, on an annualized basis, was 5.8 percent in the third quarter 2021. Investments increased $1.5 billion, or 51.6 percent, during the last twelve months and now total $4.4 billion. Total deposits equaled $12.3 billion as of quarter-end and increased by $1.4 billion, or 13.2 percent, from the same period in 2020.

    The Corporation’s Allowance for Credit Losses – Loans totaled $200.0 million as of quarter-end, or 2.21 percent of total loans. Net recoveries for the quarter totaled $0.2 million and no provision expense was recorded. Provision expense taken during the three and nine months ended September 30, 2020 of $12.5 million and $54.2 million, respectively, reflected our view of increased credit risk related to the COVID-19 pandemic. Non-accrual loans totaled $51.5 million as of quarter-end.

    Mark Hardwick, Chief Executive Officer, stated, “We are having a record year powered by strong balance sheet growth and high levels of profitability. We remain optimistic about the remainder of 2021 and our ability to deliver high levels of performance in 2022.”

    Net-interest income for the quarter totaled $104.7 million, an increase of $11.8 million from the third quarter of 2020, or 12.7 percent. Net interest margin, on a tax equivalent basis, totaling 3.20 percent, increased by 5 basis points compared to the third quarter of 2020. Yields on earning assets for the third quarter totaled 3.46 percent and cost of supporting liabilities totaled 26 basis points. Fair value accretion contributed less to margin as it accounted for 4 basis points in the third quarter of 2021, compared to 10 basis points in the third quarter of 2020. PPP loans contributed 17 basis points to margin during the third quarter of 2021 but subtracted 7 basis points from margin in the same quarter of 2020.

    Non-interest income totaled $28.5 million for the quarter, a $2.3 million increase over the third quarter of 2020. Increases in service charges on deposit accounts, fiduciary and wealth management fees and earnings on cash surrender value of life insurance were somewhat offset by a decline in gains on the sale of mortgage loans. Non-interest expense totaled $71.4 million for the quarter compared to $64.7 million in the third quarter of 2020, an increase primarily due to higher salaries and employee benefits.

    The loan to deposit ratio now totals 73.3 percent and the loan to asset ratio totals 60.1 percent. As of September 30, 2021, the Corporation’s total risk-based capital ratio equaled 14.02 percent, the common equity tier 1 capital ratio equaled 11.75 percent, and the tangible common equity ratio totaled 8.94 percent. 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 2:30 p.m. (ET) on Tuesday, October 26, 2021.

    To participate, dial (Toll Free) 877-507-0578 and reference First Merchants Corporation's third quarter earnings release. International callers please call +1 412-317-1073. A replay of the call will be available until November 26, 2021. To access a replay of the call, US participants should dial (Toll Free) 877-344-7529, Canada participants should dial 855-669-9658, or for International participants, dial +1 412-317-0088. The replay access code is 10160141.

    In order to view the web cast and presentation slides, please go to http://services.choruscall.com/links/frme211021.html during the time of the call. A replay of the web cast will be available until October 26, 2022.

    Detailed financial results are reported on the attached pages.

    About First Merchants Corporation

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

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

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

    Forward-Looking Statements

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

        
    CONSOLIDATED BALANCE SHEETS   
    (Dollars In Thousands)September 30,
     2021 2020
    ASSETS   
    Cash and cash equivalents$169,261  $164,632 
    Interest-bearing deposits369,447  273,936 
    Investment securities, net of allowance for credit losses of $245,000 and $04,445,516  2,933,286 
    Loans held for sale5,990  3,183 
    Loans9,041,576  9,243,833 
    Less: Allowance for credit losses - loans(199,972) (126,726)
    Net loans8,841,604  9,117,107 
    Premises and equipment104,814  112,959 
    Federal Home Loan Bank stock28,736  28,736 
    Interest receivable53,079  52,992 
    Goodwill and other intangibles572,323  574,369 
    Cash surrender value of life insurance291,825  291,543 
    Other real estate owned698  6,942 
    Tax asset, deferred and receivable39,504  21,762 
    Other assets137,928  155,903 
    TOTAL ASSETS$15,060,725  $13,737,350 
    LIABILITIES   
    Deposits:   
    Noninterest-bearing$2,554,323  $2,187,607 
    Interest-bearing9,794,366  8,718,546 
    Total Deposits12,348,689  10,906,153 
    Borrowings:   
    Federal funds purchased  80,000 
    Securities sold under repurchase agreements183,589  187,732 
    Federal Home Loan Bank advances334,149  399,522 
    Subordinated debentures and other borrowings118,558  118,320 
    Total Borrowings636,296  785,574 
    Interest payable3,736  5,038 
    Other liabilities203,914  206,929 
    Total Liabilities13,192,635  11,903,694 
    STOCKHOLDERS' EQUITY   
    Cumulative Preferred Stock, $1,000 par value, $1,000 liquidation value:   
    Authorized -- 600 shares   
    Issued and outstanding - 125 shares125  125 
    Common Stock, $.125 stated value:   
    Authorized -- 100,000,000 shares   
    Issued and outstanding - 53,510,745 and 53,891,733 shares6,689  6,736 
    Additional paid-in capital988,659  1,003,777 
    Retained earnings832,728  757,550 
    Accumulated other comprehensive income39,889  65,468 
    Total Stockholders' Equity1,868,090  1,833,656 
    TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY$15,060,725  $13,737,350 


    CONSOLIDATED STATEMENTS OF INCOMEThree Months Ended Nine Months Ended
    (Dollars In Thousands, Except Per Share Amounts)September 30, September 30,
     2021 2020 2021 2020
    INTEREST INCOME       
    Loans receivable:       
    Taxable$85,319  $84,162  $257,426  $268,126 
    Tax-exempt5,591  5,395  16,475  16,069 
    Investment securities:       
    Taxable7,788  5,399  21,923  19,177 
    Tax-exempt14,464  10,931  39,920  30,285 
    Deposits with financial institutions218  90  461  799 
    Federal Home Loan Bank stock168  248  434  828 
    Total Interest Income113,548  106,225  336,639  335,284 
    INTEREST EXPENSE       
    Deposits5,707  9,776  17,730  44,231 
    Federal funds purchased  5  4  118 
    Securities sold under repurchase agreements77  83  239  527 
    Federal Home Loan Bank advances1,389  1,749  4,283  5,317 
    Subordinated debentures and other borrowings1,660  1,691  4,976  5,275 
    Total Interest Expense8,833  13,304  27,232  55,468 
    NET INTEREST INCOME104,715  92,921  309,407  279,816 
    Provision for credit losses - loans  12,544    54,191 
    NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES104,715  80,377  309,407  225,625 
    OTHER INCOME       
    Service charges on deposit accounts6,249  5,209  17,109  15,491 
    Fiduciary and wealth management fees7,352  5,910  21,284  17,496 
    Card payment fees4,156  3,996  12,682  16,000 
    Net gains and fees on sales of loans3,955  5,841  16,266  12,878 
    Derivative hedge fees1,028  1,715  2,288  4,696 
    Other customer fees393  372  1,129  1,103 
    Earnings on cash surrender value of life insurance2,468  1,171  5,009  3,857 
    Net realized gains on sales of available for sale securities1,756  1,817  5,316  9,497 
    Other income1,144  132  2,393  1,425 
    Total Other Income28,501  26,163  83,476  82,443 
    OTHER EXPENSES       
    Salaries and employee benefits43,314  39,187  124,563  114,128 
    Net occupancy5,576  5,855  17,682  17,103 
    Equipment4,529  4,956  14,407  13,789 
    Marketing1,676  1,311  3,922  4,846 
    Outside data processing fees4,794  3,776  13,736  10,593 
    Printing and office supplies265  331  861  997 
    Intangible asset amortization1,463  1,486  4,284  4,511 
    FDIC assessments1,552  1,249  4,381  4,244 
    Other real estate owned and foreclosure expenses(91) 717  821  1,906 
    Professional and other outside services2,767  2,254  8,286  6,065 
    Other expenses5,539  3,587  13,834  12,687 
    Total Other Expenses71,384  64,709  206,777  190,869 
    INCOME BEFORE INCOME TAX61,832  41,831  186,106  117,199 
    Income tax expense9,062  5,621  28,308  13,734 
    NET INCOME AVAILABLE TO COMMON STOCKHOLDERS$52,770  $36,210  $157,798  $103,465 
            
    Per Share Data:       
    Basic Net Income Available to Common Stockholders$0.98  $0.67  $2.93  $1.91 
    Diluted Net Income Available to Common Stockholders$0.98  $0.67  $2.92  $1.91 
    Cash Dividends Paid$0.29  $0.26  $0.84  $0.78 
    Average Diluted Shares Outstanding (in thousands)53,960  53,971  54,093  54,278 


    FINANCIAL HIGHLIGHTS               
    (Dollars in thousands)Three Months Ended Nine Months Ended
     September 30, September 30,
     2021 2020 2021 2020
    NET CHARGE-OFFS$(197) $6,937  $4,731  $7,749 
            
    AVERAGE BALANCES:       
    Total Assets$15,006,087  $13,660,818  $14,672,596  $13,297,789 
    Total Loans9,089,648  9,252,839  9,202,327  8,987,645 
    Total Earning Assets13,741,196  12,341,257  13,419,310  11,941,839 
    Total Deposits12,350,336  10,944,721  12,017,335  10,541,777 
    Total Stockholders' Equity1,889,037  1,831,300  1,858,680  1,814,471 
            
    FINANCIAL RATIOS:       
    Return on Average Assets1.41% 1.06% 1.43% 1.04%
    Return on Average Stockholders' Equity11.17  7.91  11.32  7.60 
    Return on Average Common Stockholders' Equity11.17  7.91  11.32  7.60 
    Average Earning Assets to Average Assets91.57  90.34  91.46  89.80 
    Allowance for Credit Losses - Loans as % of Total Loans2.21  1.37  2.21  1.37 
    Net Charge-offs as % of Average Loans (Annualized)(0.01) 0.30  0.07  0.11 
    Average Stockholders' Equity to Average Assets12.59  13.41  12.67  13.64 
    Tax Equivalent Yield on Average Earning Assets3.46  3.58  3.49  3.88 
    Interest Expense/Average Earning Assets0.26  0.43  0.27  0.62 
    Net Interest Margin (FTE) on Average Earning Assets3.20  3.15  3.22  3.26 
    Efficiency Ratio51.18  51.40  50.10  50.52 
    Tangible Common Book Value Per Share$24.31  $23.48  $24.31  $23.48 


    NON-PERFORMING ASSETS         
    (Dollars In Thousands)September 30, June 30, March 31, December 31, September 30,
     2021 2021 2021 2020 2020
    Non-Accrual Loans$51,502  $57,556  $57,923  $61,471  $56,739 
    Renegotiated Loans439  629  655  3,240  2,677 
    Non-Performing Loans (NPL)51,941  58,185  58,578  64,711  59,416 
    Other Real Estate Owned and Repossessions698  601  604  940  6,984 
    Non-Performing Assets (NPA)52,639  58,786  59,182  65,651  66,400 
    90+ Days Delinquent157  183  1,093  746  1,330 
    NPAs & 90 Day Delinquent$52,796  $58,969  $60,275  $66,397  $67,730 
              
    Allowance for Credit Losses - Loans$199,972  $199,775  $201,082  $130,648  $126,726 
    Quarterly Net Charge-offs(197) 1,307  3,621  560  6,937 
    NPAs / Actual Assets %0.35% 0.39% 0.40% 0.47% 0.48%
    NPAs & 90 Day / Actual Assets %0.35% 0.40% 0.41% 0.47% 0.49%
    NPAs / Actual Loans and OREO %0.58% 0.64% 0.63% 0.71% 0.72%
    Allowance for Credit Losses - Loans / Actual Loans (%)2.21% 2.19% 2.16% 1.41% 1.37%
    Net Charge-offs as % of Average Loans (Annualized)(0.01)% 0.06% 0.16% 0.02% 0.30%


    CONSOLIDATED BALANCE SHEETS         
    (Dollars In Thousands)September 30, June 30, March 31, December 31, September 30,
     2021 2021 2021 2020 2020
    ASSETS         
    Cash and cash equivalents$169,261  $167,596  $187,901  $192,896  $164,632 
    Interest-bearing deposits369,447  438,863  392,806  392,305  273,936 
    Investment securities, net of allowance for credit losses4,445,516  4,148,314  3,700,857  3,146,787  2,933,286 
    Loans held for sale5,990  18,582  4,430  3,966  3,183 
    Loans9,041,576  9,121,250  9,318,228  9,243,174  9,243,833 
    Less: Allowance for credit losses - loans(199,972) (199,775) (201,082) (130,648) (126,726)
    Net loans8,841,604  8,921,475  9,117,146  9,112,526  9,117,107 
    Premises and equipment104,814  103,822  109,432  111,062  112,959 
    Federal Home Loan Bank stock28,736  28,736  28,736  28,736  28,736 
    Interest receivable53,079  54,173  54,662  53,948  52,992 
    Goodwill and other intangibles572,323  573,786  571,536  572,893  574,369 
    Cash surrender value of life insurance291,825  294,462  293,766  292,745  291,543 
    Other real estate owned698  601  604  940  6,942 
    Tax asset, deferred and receivable39,504  36,924  40,163  12,340  21,762 
    Other assets137,928  135,763  127,027  146,066  155,903 
    TOTAL ASSETS$15,060,725  $14,923,097  $14,629,066  $14,067,210  $13,737,350 
    LIABILITIES         
    Deposits:         
    Noninterest-bearing$2,554,323  $2,479,853  $2,494,891  $2,298,138  $2,187,607 
    Interest-bearing9,794,366  9,723,547  9,456,889  9,063,472  8,718,546 
    Total Deposits12,348,689  12,203,400  11,951,780  11,361,610  10,906,153 
    Borrowings:         
    Federal funds purchased        80,000 
    Securities sold under repurchase agreements183,589  146,904  185,721  177,102  187,732 
    Federal Home Loan Bank advances334,149  334,243  359,337  389,430  399,522 
    Subordinated debentures and other borrowings118,558  118,498  118,439  118,380  118,320 
    Total Borrowings636,296  599,645  663,497  684,912  785,574 
    Interest payable3,736  2,929  4,020  3,287  5,038 
    Other liabilities203,914  245,323  203,913  141,756  206,929 
    Total Liabilities13,192,635  13,051,297  12,823,210  12,191,565  11,903,694 
    STOCKHOLDERS' EQUITY         
    Cumulative Preferred Stock, $1,000 par value, $1,000 liquidation value:         
    Authorized -- 600 shares         
    Issued and outstanding125  125  125  125  125 
    Common Stock, $.125 stated value:         
    Authorized -- 100,000,000 shares         
    Issued and outstanding6,689  6,747  6,744  6,740  6,736 
    Additional paid-in capital988,659  1,009,182  1,007,300  1,005,366  1,003,777 
    Retained earnings832,728  795,666  755,877  788,578  757,550 
    Accumulated other comprehensive income39,889  60,080  35,810  74,836  65,468 
    Total Stockholders' Equity1,868,090  1,871,800  1,805,856  1,875,645  1,833,656 
    TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY$15,060,725  $14,923,097  $14,629,066  $14,067,210  $13,737,350 
              


    CONSOLIDATED STATEMENTS OF INCOME         
    (Dollars In Thousands, Except Per Share Amounts)September 30 June 30 March 31, December 31, September 30,
     2021 2021 2021 2020 2020
    INTEREST INCOME         
    Loans receivable:         
    Taxable$85,319  $87,002  $85,105  $90,138  $84,162 
    Tax-exempt5,591  5,545  5,339  5,414  5,395 
    Investment securities:         
    Taxable7,788  7,440  6,695  5,263  5,399 
    Tax-exempt14,464  13,071  12,385  12,056  10,931 
    Deposits with financial institutions218  129  114  139  90 
    Federal Home Loan Bank stock168  88  178  214  248 
    Total Interest Income113,548  113,275  109,816  113,224  106,225 
    INTEREST EXPENSE         
    Deposits5,707  5,823  6,200  7,509  9,776 
    Federal funds purchased  2  2  2  5 
    Securities sold under repurchase agreements77  75  87  77  83 
    Federal Home Loan Bank advances1,389  1,452  1,442  1,656  1,749 
    Subordinated debentures and other borrowings1,660  1,659  1,657  1,669  1,691 
    Total Interest Expense8,833  9,011  9,388  10,913  13,304 
    NET INTEREST INCOME104,715  104,264  100,428  102,311  92,921 
    Provision for credit losses - loans      4,482  12,544 
    NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES104,715  104,264  100,428  97,829  80,377 
    OTHER INCOME         
    Service charges on deposit accounts6,249  5,596  5,264  5,508  5,209 
    Fiduciary and wealth management fees7,352  7,510  6,422  6,251  5,910 
    Card payment fees4,156  4,159  4,367  3,502  3,996 
    Net gains and fees on sales of loans3,955  8,325  3,986  5,393  5,841 
    Derivative hedge fees1,028  943  317  2,281  1,715 
    Other customer fees393  368  368  394  372 
    Earnings on cash surrender value of life insurance2,468  1,205  1,336  1,283  1,171 
    Net realized gains on sales of available for sale securities1,756  1,761  1,799  2,398  1,817 
    Other income1,144  1,017  232  473  132 
    Total Other Income28,501  30,884  24,091  27,483  26,163 
    OTHER EXPENSES         
    Salaries and employee benefits43,314  42,438  38,811  41,809  39,187 
    Net occupancy5,576  5,615  6,491  9,653  5,855 
    Equipment4,529  4,848  5,030  5,555  4,956 
    Marketing1,676  1,122  1,124  1,763  1,311 
    Outside data processing fees4,794  4,698  4,244  3,839  3,776 
    Printing and office supplies265  313  283  307  331 
    Intangible asset amortization1,463  1,464  1,357  1,476  1,486 
    FDIC assessments1,552  1,461  1,368  1,560  1,249 
    Other real estate owned and foreclosure expenses(91) 178  734  (1,576) 717 
    Professional and other outside services2,767  2,976  2,543  2,836  2,254 
    Other expenses5,539  4,182  4,113  5,314  3,587 
    Total Other Expenses71,384  69,295  66,098  72,536  64,709 
    INCOME BEFORE INCOME TAX61,832  65,853  58,421  52,776  41,831 
    Income tax expense9,062  10,294  8,952  7,641  5,621 
    NET INCOME AVAILABLE TO COMMON STOCKHOLDERS$52,770  $55,559  $49,469  $45,135  $36,210 
              
    Per Share Data:         
    Basic Net Income Available to Common Stockholders$0.98  $1.03  $0.92  $0.83  $0.67 
    Diluted Net Income Available to Common Stockholders$0.98  $1.03  $0.91  $0.83  $0.67 
    Cash Dividends Paid$0.29  $0.29  $0.26  $0.26  $0.26 
    Average Diluted Shares Outstanding (in thousands)53,960  54,184  54,134  54,050  53,971 
    FINANCIAL RATIOS:         
    Return on Average Assets1.41% 1.51% 1.39% 1.29% 1.06%
    Return on Average Stockholders' Equity11.17  12.04  10.75  9.72  7.91 
    Return on Average Common Stockholders' Equity11.17  12.04  10.75  9.72  7.91 
    Average Earning Assets to Average Assets91.57  91.87  91.43  90.66  90.34 
    Allowance for Credit Losses - Loans as % of Total Loans2.21  2.19  2.16  1.41  1.37 
    Net Charge-offs as % of Average Loans (Annualized)(0.01) 0.06  0.16  0.02  0.30 
    Average Stockholders' Equity to Average Assets12.59  12.51  12.92  13.29  13.41 
    Tax Equivalent Yield on Average Earning Assets3.46  3.49  3.52  3.72  3.58 
    Interest Expense/Average Earning Assets0.26  0.27  0.29  0.34  0.43 
    Net Interest Margin (FTE) on Average Earning Assets3.20  3.22  3.23  3.38  3.15 
    Efficiency Ratio51.18  48.91  50.23  55.01  51.40 
    Tangible Common Book Value Per Share$24.31  $24.15  $22.98  $24.27  $23.48 


    LOANS         
    (Dollars In Thousands)September 30, June 30, March 31, December 31, September 30,
     2021 2021 2021 2020 2020
    Commercial and industrial loans$2,573,615  $2,671,076  $2,876,212  $2,776,699  $2,875,331 
    Agricultural land, production and other loans to farmers240,686  235,020  245,631  281,884  301,192 
    Real estate loans:         
    Construction521,889  491,200  541,224  484,723  622,084 
    Commercial real estate, non-owner occupied2,150,387  2,263,497  2,178,832  2,220,949  2,098,589 
    Commercial real estate, owner occupied952,441  953,501  950,038  958,501  931,815 
    Residential1,154,373  1,127,442  1,239,925  1,234,741  1,146,406 
    Home equity531,307  489,997  482,229  508,259  527,458 
    Individuals' loans for household and other personal expenditures135,093  130,819  126,387  129,479  125,411 
    Public finance and other commercial loans781,785  758,698  677,750  647,939  615,547 
    Loans9,041,576  9,121,250  9,318,228  9,243,174  9,243,833 
    Allowance for credit losses - loans(199,972) (199,775) (201,082) (130,648) (126,726)
    NET LOANS$8,841,604  $8,921,475  $9,117,146  $9,112,526  $9,117,107 


    DEPOSITS         
    (Dollars In Thousands)September 30, June 30, March 31, December 31, September 30,
     2021 2021 2021 2020 2020
    Demand deposits$7,317,399  $7,261,603  $7,245,850  $6,821,152  $6,279,554 
    Savings deposits4,301,483  4,157,552  3,857,624  3,661,713  3,518,286 
    Certificates and other time deposits of $100,000 or more283,396  304,394  332,745  346,194  467,610 
    Other certificates and time deposits404,010  423,922  449,655  459,168  542,919 
    Brokered deposits42,401  55,929  65,906  73,383  97,784 
    TOTAL DEPOSITS$12,348,689  $12,203,400  $11,951,780  $11,361,610  $10,906,153 


    CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST MARGIN ANALYSIS      
    (Dollars in Thousands)           
     For the Three Months Ended
     September 30, 2021 September 30, 2020
     Average
    Balance
     Interest
    Income /
    Expense
     Average
    Rate
     Average
    Balance
     Interest
    Income /
    Expense
     Average
    Rate
    Assets:           
    Interest-bearing deposits$539,377  $218  0.16% $301,529  $90  0.12%
    Federal Home Loan Bank stock28,736  168  2.34  28,736  248  3.45 
    Investment Securities: (1)           
    Taxable1,843,026  7,788  1.69  1,258,690  5,399  1.72 
    Tax-Exempt (2)2,240,409  18,309  3.27  1,499,463  13,837  3.69 
    Total Investment Securities4,083,435  26,097  2.56  2,758,153  19,236  2.79 
    Loans held for sale17,426  158  3.63  24,705  257  4.16 
    Loans: (3)           
    Commercial6,745,303  70,442  4.18  6,965,837  66,826  3.84 
    Real Estate Mortgage886,469  8,142  3.67  887,661  9,996  4.50 
    Installment690,093  6,576  3.81  693,363  7,083  4.09 
    Tax-Exempt (2)750,357  7,078  3.77  681,273  6,829  4.01 
    Total Loans9,089,648  92,396  4.07  9,252,839  90,991  3.93 
    Total Earning Assets13,741,196  118,879  3.46% 12,341,257  110,565  3.58%
    Total Non-Earning Assets1,264,891      1,319,561     
    Total Assets$15,006,087      $13,660,818     
    Liabilities:           
    Interest-bearing deposits:           
    Interest-bearing deposits$4,799,624  $3,606  0.30% $4,098,017  $3,890  0.38%
    Money market deposits2,459,205  764  0.12  1,813,392  1,167  0.26 
    Savings deposits1,788,281  486  0.11  1,574,700  583  0.15 
    Certificates and other time deposits758,565  851  0.45  1,267,152  4,136  1.31 
    Total Interest-bearing Deposits9,805,675  5,707  0.23  8,753,261  9,776  0.45 
    Borrowings619,768  3,126  2.02  733,757  3,528  1.92 
    Total Interest-bearing Liabilities10,425,443  8,833  0.34  9,487,018  13,304  0.56 
    Noninterest-bearing deposits2,544,661      2,191,460     
    Other liabilities146,946      151,040     
    Total Liabilities13,117,050      11,829,518     
    Stockholders' Equity1,889,037      1,831,300     
    Total Liabilities and Stockholders' Equity$15,006,087  8,833    $13,660,818  13,304   
    Net Interest Income (FTE)  $110,046      $97,261   
    Net Interest Spread (FTE) (4)    3.12%     3.02%
                
    Net Interest Margin (FTE):           
    Interest Income (FTE) / Average Earning Assets    3.46%     3.58%
    Interest Expense / Average Earning Assets    0.26%     0.43%
    Net Interest Margin (FTE) (5)    3.20%     3.15%
                
    (1) Average balance of securities is computed based on the average of the historical amortized cost balances without the effects of the fair value adjustments. Annualized amounts are computed using a 30/360 day basis.
    (2) Tax-exempt securities and loans are presented on a fully taxable equivalent basis, using a marginal tax rate of 21 percent for 2021 and 2020. These totals equal $5,331 and $4,340 for the three months ended September 30, 2021 and 2020, respectively.
    (3) Non accruing loans have been included in the average balances.
    (4) Net Interest Spread (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average interest-bearing liabilities.
    (5) Net Interest Margin (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average earning assets.


    CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST MARGIN ANALYSIS      
    (Dollars in Thousands)           
     For the Nine Months Ended
     September 30, 2021 September 30, 2020
     Average
    Balance
     Interest
    Income /
    Expense
     Average
    Rate
     Average
    Balance
     Interest
    Income /
    Expense
     Average
    Rate
    Assets:           
    Interest-bearing deposits$509,153  $461  0.12% $280,038  $799  0.38%
    Federal Home Loan Bank stock28,736  434  2.01  28,736  828  3.84 
    Investment Securities: (1)           
    Taxable1,689,697  21,923  1.73  1,302,943  19,177  1.96 
    Tax-Exempt (2)1,989,397  50,532  3.39  1,342,477  38,335  3.81 
    Total Investment Securities3,679,094  72,455  2.63  2,645,420  57,512  2.90 
    Loans held for sale19,360  551  3.79  17,175  581  4.51 
    Loans: (3)           
    Commercial6,857,968  210,502  4.09  6,698,042  213,241  4.24 
    Real Estate Mortgage924,652  26,917  3.88  882,911  30,520  4.61 
    Installment674,696  19,456  3.84  725,596  23,784  4.37 
    Tax-Exempt (2)725,651  20,854  3.83  663,921  20,341  4.09 
    Total Loans9,202,327  278,280  4.03  8,987,645  288,467  4.28 
    Total Earning Assets13,419,310  351,630  3.49% 11,941,839  347,606  3.88%
    Total Non-Earning Assets1,253,286      1,355,950     
    Total Assets$14,672,596      $13,297,789     
    Liabilities:           
    Interest-bearing deposits:           
    Interest-bearing deposits$4,721,267  $10,875  0.31% $3,880,489  $16,351  0.56%
    Money market deposits2,295,589  2,395  0.14  1,674,622  6,647  0.53 
    Savings deposits1,730,149  1,424  0.11  1,507,269  3,007  0.27 
    Certificates and other time deposits809,721  3,036  0.50  1,476,499  18,226  1.65 
    Total Interest-bearing Deposits9,556,726  17,730  0.25  8,538,879  44,231  0.69 
    Borrowings646,326  9,502  1.96  796,836  11,237  1.88 
    Total Interest-bearing Liabilities10,203,052  27,232  0.36  9,335,715  55,468  0.79 
    Noninterest-bearing deposits2,460,609      2,002,898     
    Other liabilities150,255      144,705     
    Total Liabilities12,813,916      11,483,318     
    Stockholders' Equity1,858,680      1,814,471     
    Total Liabilities and Stockholders' Equity$14,672,596  27,232    $13,297,789  55,468   
    Net Interest Income (FTE)  $324,398      $292,138   
    Net Interest Spread (FTE) (4)    3.13%     3.09%
                
    Net Interest Margin (FTE):           
    Interest Income (FTE) / Average Earning Assets    3.49%     3.88%
    Interest Expense / Average Earning Assets    0.27%     0.62%
    Net Interest Margin (FTE) (5)    3.22%     3.26%
                
    (1) Average balance of securities is computed based on the average of the historical amortized cost balances without the effects of the fair value adjustments. Annualized amounts are computed using a 30/360 day basis.
    (2) Tax-exempt securities and loans are presented on a fully taxable equivalent basis, using a marginal tax rate of 21 percent for 2021 and 2020. These totals equal $14,991 and $12,322 for the nine months ended September 30, 2021 and 2020, respectively.
    (3) Non accruing loans have been included in the average balances.           
    (4) Net Interest Spread (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average interest-bearing liabilities.
    (5) Net Interest Margin (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average earning assets.

    For more information, contact:
    Nicole M. Weaver, Vice President and Director of Corporate Administration
    765-521-7619
    http://www.firstmerchants.com


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