FRME - First Merchants Corporation Announces First Quarter 2024 Earnings Per Share
MUNCIE, Ind., April 25, 2024 (GLOBE NEWSWIRE) -- First Merchants Corporation (NASDAQ - FRME)
First Quarter 2024 Highlights:
- Net income available to common stockholders was $47.5 million and diluted earnings per common share totaled $0.80 compared to $63.6 million and $1.07 in the first quarter of 2023, and $42.0 million and $0.71 in the fourth quarter of 2023. Net income and diluted earnings per common share, excluding non-core charges of $3.5 million incurred during the quarter, totaled $50.1 million and $0.85, respectively.
- Strong capital position with Common Equity Tier 1 Capital Ratio of 11.25 percent.
- Total loans declined $24.3 million, or 0.8 percent annualized on a linked quarter basis, but increased $346.4 million, or 2.8 percent during the last twelve months when excluding the impact of a non-relationship commercial loan portfolio sale of $116.6 million that occurred during the second quarter of 2023.
- Total deposits increased $63.1 million, or 1.7 percent annualized on a linked quarter basis, and $181.3 million, or 1.2 percent during the last twelve months.
- Net charge-offs totaled 7 basis points of average loans (annualized) compared to 10 basis points on a linked quarter basis.
- Nonperforming assets to total assets were 37 basis points compared to 32 basis points on a linked quarter basis.
- The efficiency ratio totaled 59.21 percent for the quarter and 57.03 percent excluding $3.5 million of non-core charges incurred during the quarter.
Mark Hardwick, Chief Executive Officer, stated, "Given the length and severity of the inverted yield curve, we were pleased to see relative stabilization of our net interest margin during the quarter. Capital, liquidity, the allowance for credit losses and earnings are strong and supported share repurchase activity during the quarter of $30 million, as well as, the redemption of $40 million in sub-debt." Hardwick added, "Three of our four major technology initiatives have also been deployed to include in-branch account opening, consumer online and mobile upgrades, and a new Private Wealth platform."
First Quarter Financial Results:
First Merchants Corporation (the “Corporation) has reported first quarter 2024 net income available to common stockholders of $47.5 million compared to $63.6 million during the same period in 2023. Diluted earnings per common share for the period totaled $0.80 compared to the first quarter of 2023 result of $1.07 per share. The corporation incurred $3.5 million of non-core charges during the quarter including $1.1 million from an additional FDIC special assessment and $2.4 million of digital platform conversion costs.
Total assets equaled $18.3 billion as of quarter-end and loans totaled $12.5 billion. During the past twelve months, total loans grew by $346.4 million, or 2.8 percent and were offset by a non-relationship based commercial loan sale of $116.6 million that occurred in the second quarter of 2023. On a linked quarter basis, loans declined $24.3 million, or 0.8 percent annualized.
Investments securities, totaling $3.8 billion, decreased $273.8 million, or 6.7 percent, during the last twelve months and decreased $27.8 million, or 2.9 percent annualized on a linked quarter basis.
Total deposits equaled $14.9 billion as of quarter-end and increased by $181.3 million, or 1.2 percent, over the past twelve months. Total deposits increased $63.1 million, or 1.7 percent annualized on a linked quarter basis. During the quarter, customer deposits increased $87.3 million which was offset by a reduction in brokered deposits of $24.2 million. The loan to deposit ratio declined slightly to 83.9 percent at period end from 84.4 percent in the prior quarter.
The Corporation’s Allowance for Credit Losses – Loans (ACL) totaled $204.7 million as of quarter-end, a decrease of $0.3 million from prior quarter. Loan charge-offs, net of recoveries, for the quarter totaled $2.3 million. Provision expense for loans was recorded during the quarter of $2.0 million resulting in an ACL as a percent of loans of 1.64 percent. Reserves for unfunded commitments totaling $19.5 million remain unchanged from prior quarter. Non-performing assets to total assets were 0.37 percent for the first quarter of 2024, an increase of five basis points compared to 0.32 percent in the prior quarter.
Net interest income, totaling $127.1 million for the quarter, declined $3.0 million, or 2.3 percent, compared to prior quarter and decreased $17.1 million, or 11.8 percent, compared to the first quarter of 2023. Stated net-interest margin on a tax equivalent basis totaling 3.10 percent, declined by six basis points compared to the fourth quarter of 2023 and decreased 48 basis points compared to the first quarter of 2023. During the quarter, increased deposit costs and a continued change in deposit mix offset the increase in earning asset yields reducing net-interest margin.
Noninterest income, totaling $26.6 million for the quarter, increased $0.2 million, compared to the fourth quarter of 2023 and increased $1.6 million from the first quarter of 2023. Customer-related fees declined $1.2 million from prior quarter due to lower gains on sales of loans and derivative hedge fees. Non-customer related fees increased $1.4 million from prior quarter primarily due to realized losses on the sales of securities recorded in the prior quarter.
Noninterest expense totaled $96.9 million for the quarter, a decrease of $11.2 million from the fourth quarter of 2023 due to a decline in non-core charges and lower marketing spend. Non-core charges incurred during the quarter totaled $3.5 million and included $1.1 million from an additional FDIC special assessment and $2.4 million of digital platform conversion costs. Non-core charges recorded in the prior quarter totaled $12.7 million and included $4.3 million from an FDIC special assessment, $6.3 million of early retirement and severance costs, and $2.1 million from a lease termination.
The Corporation’s total risk-based capital ratio equaled 13.34 percent, common equity tier 1 capital ratio equaled 11.25 percent, and the tangible common equity ratio totaled 8.32 percent. These ratios continue to demonstrate the Corporation’s strong capital position.
CONFERENCE CALL
First Merchants Corporation will conduct a fourth quarter earnings conference call and web cast at 11:30 a.m. (ET) on Thursday, April 25, 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/BIdd109dbd75ba4d42a3ddae5a62b4e2a1 )
In order to view the webcast and presentation slides, please go to ( https://edge.media-server.com/mmc/p/8p72e5ye ) during the time of the call. A replay of the webcast will be available until April 25, 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 of First Merchants’ goals, intentions and expectations; statements regarding the First Merchants’ business plan and growth strategies; statements regarding the asset quality of First Merchants’ loan and investment portfolios; and estimates of First Merchants’ risks and future costs and benefits. These forward-looking statements are subject to significant risks, assumptions and uncertainties that may cause results to differ materially from those set forth in forward-looking statements, including, among other things: possible changes in monetary and fiscal policies, and laws and regulations; the effects of easing restrictions on participants in the financial services industry; the cost and other effects of legal and administrative cases; possible changes in the credit worthiness of customers and the possible impairment of collectability of loans; fluctuations in market rates of interest; competitive factors in the banking industry; changes in the banking legislation or regulatory requirements of federal and state agencies applicable to bank holding companies and banks like First Merchants’ affiliate bank; continued availability of earnings and excess capital sufficient for the lawful and prudent declaration of dividends; changes in market, economic, operational, liquidity (including the ability to grow and maintain core deposits and retain large, uninsured deposits), credit and interest rate risks associated with the First Merchants’ business; and other risks and factors identified in each of First Merchants’ filings with the Securities and Exchange Commission. First Merchants does not undertake any obligation to update any forward-looking statement, whether written or oral, relating to the matters discussed in this press release. In addition, First Merchants’ past results of operations do not necessarily indicate its anticipated future results.
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
| CONSOLIDATED BALANCE SHEETS |
| (Dollars In Thousands) |
| March 31, |
| 2024 |
| 2023 |
| ASSETS |
| Cash and due from banks |
| $ |
| 100,514 |
| $ |
| 125,818 |
| Interest-bearing deposits |
| 410,497 |
| 352,695 |
| Investment securities, net of allowance for credit losses of $245,000 and $245,000 |
| 3,783,574 |
| 4,057,389 |
| Loans held for sale |
| 15,118 |
| 9,408 |
| Loans |
| 12,465,582 |
| 12,241,461 |
| Less: Allowance for credit losses - loans |
| (204,681 |
| ) |
| (223,052 |
| ) |
| Net loans |
| 12,260,901 |
| 12,018,409 |
| Premises and equipment |
| 132,706 |
| 115,857 |
| Federal Home Loan Bank stock |
| 41,758 |
| 41,878 |
| Interest receivable |
| 92,550 |
| 85,515 |
| Goodwill and other intangibles |
| 737,144 |
| 745,647 |
| Cash surrender value of life insurance |
| 306,028 |
| 309,090 |
| Other real estate owned |
| 4,886 |
| 7,777 |
| Tax asset, deferred and receivable |
| 101,121 |
| 103,070 |
| Other assets |
| 331,006 |
| 270,777 |
| TOTAL ASSETS |
| $ |
| 18,317,803 |
| $ |
| 18,243,330 |
| LIABILITIES |
| Deposits: |
| Noninterest-bearing |
| $ |
| 2,338,364 |
| $ |
| 2,964,355 |
| Interest-bearing |
| 12,546,220 |
| 11,738,932 |
| Total Deposits |
| 14,884,584 |
| 14,703,287 |
| Borrowings: |
| Federal funds purchased |
| — |
| 20 |
| Securities sold under repurchase agreements |
| 130,264 |
| 179,067 |
| Federal Home Loan Bank advances |
| 612,778 |
| 823,577 |
| Subordinated debentures and other borrowings |
| 118,612 |
| 151,312 |
| Total Borrowings |
| 861,654 |
| 1,153,976 |
| Interest payable |
| 19,262 |
| 11,979 |
| Other liabilities |
| 327,500 |
| 251,640 |
| Total Liabilities |
| 16,093,000 |
| 16,120,882 |
| STOCKHOLDERS' EQUITY |
| Preferred Stock, $1,000 par value, $1,000 liquidation value: |
| Authorized -- 600 cumulative shares |
| Issued and outstanding - 125 cumulative shares |
| 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 shares |
| 25,000 |
| 25,000 |
| Common Stock, $.125 stated value: |
| Authorized -- 100,000,000 shares |
| Issued and outstanding - 58,564,819 and 59,257,051 shares |
| 7,321 |
| 7,407 |
| Additional paid-in capital |
| 1,208,447 |
| 1,231,532 |
| Retained earnings |
| 1,181,939 |
| 1,057,298 |
| Accumulated other comprehensive loss |
| (198,029 |
| ) |
| (198,914 |
| ) |
| Total Stockholders' Equity |
| 2,224,803 |
| 2,122,448 |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
| $ |
| 18,317,803 |
| $ |
| 18,243,330 |
| CONSOLIDATED STATEMENTS OF INCOME |
| Three Months Ended |
| (Dollars In Thousands, Except Per Share Amounts) |
| March 31, |
| 2024 |
| 2023 |
| INTEREST INCOME |
| Loans receivable: |
| Taxable |
| $ |
| 198,023 |
| $ |
| 172,353 |
| Tax-exempt |
| 8,190 |
| 7,709 |
| Investment securities: |
| Taxable |
| 8,748 |
| 9,087 |
| Tax-exempt |
| 13,611 |
| 16,070 |
| Deposits with financial institutions |
| 6,493 |
| 637 |
| Federal Home Loan Bank stock |
| 835 |
| 542 |
| Total Interest Income |
| 235,900 |
| 206,398 |
| INTEREST EXPENSE |
| Deposits |
| 98,285 |
| 50,685 |
| Federal funds purchased |
| — |
| 1,297 |
| Securities sold under repurchase agreements |
| 1,032 |
| 848 |
| Federal Home Loan Bank advances |
| 6,773 |
| 7,064 |
| Subordinated debentures and other borrowings |
| 2,747 |
| 2,385 |
| Total Interest Expense |
| 108,837 |
| 62,279 |
| NET INTEREST INCOME |
| 127,063 |
| 144,119 |
| Provision for credit losses |
| 2,000 |
| — |
| NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES |
| 125,063 |
| 144,119 |
| NONINTEREST INCOME |
| Service charges on deposit accounts |
| 7,907 |
| 7,359 |
| Fiduciary and wealth management fees |
| 8,200 |
| 7,862 |
| Card payment fees |
| 4,500 |
| 5,172 |
| Net gains and fees on sales of loans |
| 3,254 |
| 2,399 |
| Derivative hedge fees |
| 263 |
| 1,148 |
| Other customer fees |
| 427 |
| 517 |
| Earnings on cash surrender value of life insurance |
| 1,592 |
| 1,288 |
| Net realized losses on sales of available for sale securities |
| (2 |
| ) |
| (1,571 |
| ) |
| Other income |
| 497 |
| 823 |
| Total Noninterest Income |
| 26,638 |
| 24,997 |
| NONINTEREST EXPENSES |
| Salaries and employee benefits |
| 58,293 |
| 57,459 |
| Net occupancy |
| 7,312 |
| 7,259 |
| Equipment |
| 6,226 |
| 6,126 |
| Marketing |
| 1,198 |
| 1,309 |
| Outside data processing fees |
| 6,889 |
| 6,113 |
| Printing and office supplies |
| 353 |
| 383 |
| Intangible asset amortization |
| 1,957 |
| 2,197 |
| FDIC assessments |
| 4,287 |
| 1,396 |
| Other real estate owned and foreclosure expenses |
| 534 |
| (18 |
| ) |
| Professional and other outside services |
| 3,952 |
| 3,698 |
| Other expenses |
| 5,934 |
| 7,798 |
| Total Noninterest Expenses |
| 96,935 |
| 93,720 |
| INCOME BEFORE INCOME TAX |
| 54,766 |
| 75,396 |
| Income tax expense |
| 6,825 |
| 11,317 |
| NET INCOME |
| 47,941 |
| 64,079 |
| Preferred stock dividends |
| 469 |
| 469 |
| NET INCOME AVAILABLE TO COMMON STOCKHOLDERS |
| $ |
| 47,472 |
| $ |
| 63,610 |
| Per Share Data: |
| Basic Net Income Available to Common Stockholders |
| $ |
| 0.80 |
| $ |
| 1.07 |
| Diluted Net Income Available to Common Stockholders |
| $ |
| 0.80 |
| $ |
| 1.07 |
| Cash Dividends Paid to Common Stockholders |
| $ |
| 0.34 |
| $ |
| 0.32 |
| Average Diluted Common Shares Outstanding (in thousands) |
| 59,273 |
| 59,441 |
| FINANCIAL HIGHLIGHTS |
| (Dollars in thousands) |
| Three Months Ended |
| March 31, |
| 2024 |
| 2023 |
| NET CHARGE-OFFS |
| $ |
| 2,253 |
| $ |
| 225 |
| AVERAGE BALANCES: |
| Total Assets |
| $ |
| 18,430,521 |
| $ |
| 18,022,195 |
| Total Loans |
| 12,477,066 |
| 12,135,384 |
| Total Earning Assets |
| 17,123,851 |
| 16,824,407 |
| Total Deposits |
| 14,881,205 |
| 14,423,409 |
| Total Stockholders' Equity |
| 2,242,139 |
| 2,083,125 |
| FINANCIAL RATIOS: |
| Return on Average Assets |
| 1.04 |
| % |
| 1.42 |
| % |
| Return on Average Stockholders' Equity |
| 8.47 |
| 12.21 |
| Return on Tangible Common Stockholders' Equity |
| 13.21 |
| 19.82 |
| Average Earning Assets to Average Assets |
| 92.91 |
| 93.35 |
| Allowance for Credit Losses - Loans as % of Total Loans |
| 1.64 |
| 1.82 |
| Net Charge-offs as % of Average Loans (Annualized) |
| 0.07 |
| 0.01 |
| Average Stockholders' Equity to Average Assets |
| 12.17 |
| 11.56 |
| Tax Equivalent Yield on Average Earning Assets |
| 5.65 |
| 5.06 |
| Interest Expense/Average Earning Assets |
| 2.55 |
| 1.48 |
| Net Interest Margin (FTE) on Average Earning Assets |
| 3.10 |
| 3.58 |
| Efficiency Ratio |
| 59.21 |
| 51.72 |
| Tangible Common Book Value Per Share |
| $ |
| 25.07 |
| $ |
| 22.93 |
| NONPERFORMING ASSETS |
| (Dollars In Thousands) |
| March 31, |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| 2024 |
| 2023 |
| 2023 |
| 2023 |
| 2023 |
| Nonaccrual Loans |
| $ |
| 62,478 |
| $ |
| 53,580 |
| $ |
| 53,102 |
| $ |
| 69,240 |
| $ |
| 46,576 |
| Other Real Estate Owned and Repossessions |
| 4,886 |
| 4,831 |
| 6,480 |
| 7,685 |
| 7,777 |
| Nonperforming Assets (NPA) |
| 67,364 |
| 58,411 |
| 59,582 |
| 76,925 |
| 54,353 |
| 90+ Days Delinquent |
| 2,838 |
| 172 |
| 89 |
| 428 |
| 7,032 |
| NPAs & 90 Day Delinquent |
| $ |
| 70,202 |
| $ |
| 58,583 |
| $ |
| 59,671 |
| $ |
| 77,353 |
| $ |
| 61,385 |
| Allowance for Credit Losses - Loans |
| $ |
| 204,681 |
| $ |
| 204,934 |
| $ |
| 205,782 |
| $ |
| 221,147 |
| $ |
| 223,052 |
| Quarterly Net Charge-offs |
| 2,253 |
| 3,148 |
| 20,365 |
| 1,905 |
| 225 |
| NPAs / Actual Assets % |
| 0.37 |
| % |
| 0.32 |
| % |
| 0.33 |
| % |
| 0.43 |
| % |
| 0.30 |
| % |
| NPAs & 90 Day / Actual Assets % |
| 0.38 |
| % |
| 0.32 |
| % |
| 0.33 |
| % |
| 0.43 |
| % |
| 0.34 |
| % |
| NPAs / Actual Loans and OREO % |
| 0.54 |
| % |
| 0.47 |
| % |
| 0.48 |
| % |
| 0.63 |
| % |
| 0.44 |
| % |
| Allowance for Credit Losses - Loans / Actual Loans (%) |
| 1.64 |
| % |
| 1.64 |
| % |
| 1.67 |
| % |
| 1.80 |
| % |
| 1.82 |
| % |
| Net Charge-offs (Recoveries) as % of Average Loans (Annualized) |
| 0.07 |
| % |
| 0.10 |
| % |
| 0.66 |
| % |
| 0.06 |
| % |
| 0.01 |
| % |
| CONSOLIDATED BALANCE SHEETS |
| (Dollars In Thousands) |
| March 31, |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| 2024 |
| 2023 |
| 2023 |
| 2023 |
| 2023 |
| ASSETS |
| Cash and due from banks |
| $ |
| 100,514 |
| $ |
| 112,649 |
| $ |
| 125,173 |
| $ |
| 108,975 |
| $ |
| 125,818 |
| Interest-bearing deposits |
| 410,497 |
| 436,080 |
| 348,639 |
| 219,480 |
| 352,695 |
| Investment securities, net of allowance for credit losses |
| 3,783,574 |
| 3,811,364 |
| 3,713,724 |
| 3,891,491 |
| 4,057,389 |
| Loans held for sale |
| 15,118 |
| 18,934 |
| 30,972 |
| 27,297 |
| 9,408 |
| Loans |
| 12,465,582 |
| 12,486,027 |
| 12,271,422 |
| 12,270,233 |
| 12,241,461 |
| Less: Allowance for credit losses - loans |
| (204,681 |
| ) |
| (204,934 |
| ) |
| (205,782 |
| ) |
| (221,147 |
| ) |
| (223,052 |
| ) |
| Net loans |
| 12,260,901 |
| 12,281,093 |
| 12,065,640 |
| 12,049,086 |
| 12,018,409 |
| Premises and equipment |
| 132,706 |
| 133,896 |
| 132,441 |
| 114,402 |
| 115,857 |
| Federal Home Loan Bank stock |
| 41,758 |
| 41,769 |
| 41,797 |
| 41,842 |
| 41,878 |
| Interest receivable |
| 92,550 |
| 97,664 |
| 90,011 |
| 89,784 |
| 85,515 |
| Goodwill and other intangibles |
| 737,144 |
| 739,101 |
| 741,283 |
| 743,465 |
| 745,647 |
| Cash surrender value of life insurance |
| 306,028 |
| 306,301 |
| 306,106 |
| 307,020 |
| 309,090 |
| Other real estate owned |
| 4,886 |
| 4,831 |
| 6,480 |
| 7,685 |
| 7,777 |
| Tax asset, deferred and receivable |
| 101,121 |
| 99,883 |
| 135,521 |
| 113,724 |
| 103,070 |
| Other assets |
| 331,006 |
| 322,322 |
| 340,476 |
| 318,005 |
| 270,777 |
| TOTAL ASSETS |
| $ |
| 18,317,803 |
| $ |
| 18,405,887 |
| $ |
| 18,078,263 |
| $ |
| 18,032,256 |
| $ |
| 18,243,330 |
| LIABILITIES |
| Deposits: |
| Noninterest-bearing |
| $ |
| 2,338,364 |
| $ |
| 2,500,062 |
| $ |
| 2,554,984 |
| $ |
| 2,636,017 |
| $ |
| 2,964,355 |
| Interest-bearing |
| 12,546,220 |
| 12,321,391 |
| 12,091,592 |
| 11,945,138 |
| 11,738,932 |
| Total Deposits |
| 14,884,584 |
| 14,821,453 |
| 14,646,576 |
| 14,581,155 |
| 14,703,287 |
| Borrowings: |
| Federal funds purchased |
| — |
| — |
| — |
| — |
| 20 |
| Securities sold under repurchase agreements |
| 130,264 |
| 157,280 |
| 152,537 |
| 152,472 |
| 179,067 |
| Federal Home Loan Bank advances |
| 612,778 |
| 712,852 |
| 713,384 |
| 723,480 |
| 823,577 |
| Subordinated debentures and other borrowings |
| 118,612 |
| 158,644 |
| 158,665 |
| 151,325 |
| 151,312 |
| Total Borrowings |
| 861,654 |
| 1,028,776 |
| 1,024,586 |
| 1,027,277 |
| 1,153,976 |
| Interest payable |
| 19,262 |
| 18,912 |
| 16,473 |
| 13,595 |
| 11,979 |
| Other liabilities |
| 327,500 |
| 289,033 |
| 297,984 |
| 264,664 |
| 251,640 |
| Total Liabilities |
| 16,093,000 |
| 16,158,174 |
| 15,985,619 |
| 15,886,691 |
| 16,120,882 |
| STOCKHOLDERS' EQUITY |
| Preferred Stock, $1,000 par value, $1,000 liquidation value: |
| Authorized -- 600 cumulative shares |
| Issued and outstanding - 125 cumulative shares |
| 125 |
| 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 shares |
| 25,000 |
| 25,000 |
| 25,000 |
| 25,000 |
| 25,000 |
| Common Stock, $.125 stated value: |
| Authorized -- 100,000,000 shares |
| Issued and outstanding |
| 7,321 |
| 7,428 |
| 7,425 |
| 7,412 |
| 7,407 |
| Additional paid-in capital |
| 1,208,447 |
| 1,236,506 |
| 1,234,402 |
| 1,233,593 |
| 1,231,532 |
| Retained earnings |
| 1,181,939 |
| 1,154,624 |
| 1,132,962 |
| 1,097,399 |
| 1,057,298 |
| Accumulated other comprehensive loss |
| (198,029 |
| ) |
| (175,970 |
| ) |
| (307,270 |
| ) |
| (217,964 |
| ) |
| (198,914 |
| ) |
| Total Stockholders' Equity |
| 2,224,803 |
| 2,247,713 |
| 2,092,644 |
| 2,145,565 |
| 2,122,448 |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
| $ |
| 18,317,803 |
| $ |
| 18,405,887 |
| $ |
| 18,078,263 |
| $ |
| 18,032,256 |
| $ |
| 18,243,330 |
| CONSOLIDATED STATEMENTS OF INCOME |
| (Dollars In Thousands, Except Per Share Amounts) |
| March 31, |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| 2024 |
| 2023 |
| 2023 |
| 2023 |
| 2023 |
| INTEREST INCOME |
| Loans receivable: |
| Taxable |
| $ |
| 198,023 |
| $ |
| 197,523 |
| $ |
| 191,705 |
| $ |
| 186,256 |
| $ |
| 172,353 |
| Tax-exempt |
| 8,190 |
| 8,197 |
| 8,288 |
| 7,760 |
| 7,709 |
| Investment securities: |
| Taxable |
| 8,748 |
| 8,644 |
| 8,590 |
| 8,886 |
| 9,087 |
| Tax-exempt |
| 13,611 |
| 13,821 |
| 13,947 |
| 14,279 |
| 16,070 |
| Deposits with financial institutions |
| 6,493 |
| 8,034 |
| 5,884 |
| 3,164 |
| 637 |
| Federal Home Loan Bank stock |
| 835 |
| 771 |
| 719 |
| 1,020 |
| 542 |
| Total Interest Income |
| 235,900 |
| 236,990 |
| 229,133 |
| 221,365 |
| 206,398 |
| INTEREST EXPENSE |
| Deposits |
| 98,285 |
| 96,655 |
| 85,551 |
| 73,201 |
| 50,685 |
| Federal funds purchased |
| — |
| 1 |
| — |
| 123 |
| 1,297 |
| Securities sold under repurchase agreements |
| 1,032 |
| 827 |
| 797 |
| 979 |
| 848 |
| Federal Home Loan Bank advances |
| 6,773 |
| 6,431 |
| 6,896 |
| 6,815 |
| 7,064 |
| Subordinated debentures and other borrowings |
| 2,747 |
| 3,013 |
| 2,506 |
| 2,412 |
| 2,385 |
| Total Interest Expense |
| 108,837 |
| 106,927 |
| 95,750 |
| 83,530 |
| 62,279 |
| NET INTEREST INCOME |
| 127,063 |
| 130,063 |
| 133,383 |
| 137,835 |
| 144,119 |
| Provision for credit losses |
| 2,000 |
| 1,500 |
| 2,000 |
| — |
| — |
| NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES |
| 125,063 |
| 128,563 |
| 131,383 |
| 137,835 |
| 144,119 |
| NONINTEREST INCOME |
| Service charges on deposit accounts |
| 7,907 |
| 7,690 |
| 7,975 |
| 7,813 |
| 7,359 |
| Fiduciary and wealth management fees |
| 8,200 |
| 8,187 |
| 7,394 |
| 7,397 |
| 7,862 |
| Card payment fees |
| 4,500 |
| 4,437 |
| 4,716 |
| 4,537 |
| 5,172 |
| Net gains and fees on sales of loans |
| 3,254 |
| 4,111 |
| 5,517 |
| 3,632 |
| 2,399 |
| Derivative hedge fees |
| 263 |
| 1,049 |
| 516 |
| 672 |
| 1,148 |
| Other customer fees |
| 427 |
| 237 |
| 384 |
| 742 |
| 517 |
| Earnings on cash surrender value of life insurance |
| 1,592 |
| 3,202 |
| 1,761 |
| 2,096 |
| 1,288 |
| Net realized losses on sales of available for sale securities |
| (2 |
| ) |
| (2,317 |
| ) |
| (1,650 |
| ) |
| (1,392 |
| ) |
| (1,571 |
| ) |
| Other income (loss) |
| 497 |
| (152 |
| ) |
| 1,229 |
| 822 |
| 823 |
| Total Noninterest Income |
| 26,638 |
| 26,444 |
| 27,842 |
| 26,319 |
| 24,997 |
| NONINTEREST EXPENSES |
| Salaries and employee benefits |
| 58,293 |
| 60,967 |
| 55,566 |
| 54,753 |
| 57,459 |
| Net occupancy |
| 7,312 |
| 9,089 |
| 6,837 |
| 6,674 |
| 7,259 |
| Equipment |
| 6,226 |
| 6,108 |
| 5,698 |
| 6,181 |
| 6,126 |
| Marketing |
| 1,198 |
| 2,647 |
| 2,369 |
| 1,102 |
| 1,309 |
| Outside data processing fees |
| 6,889 |
| 5,875 |
| 6,573 |
| 6,604 |
| 6,113 |
| Printing and office supplies |
| 353 |
| 402 |
| 333 |
| 434 |
| 383 |
| Intangible asset amortization |
| 1,957 |
| 2,182 |
| 2,182 |
| 2,182 |
| 2,197 |
| FDIC assessments |
| 4,287 |
| 7,557 |
| 2,981 |
| 2,740 |
| 1,396 |
| Other real estate owned and foreclosure expenses |
| 534 |
| 1,743 |
| 677 |
| 916 |
| (18 |
| ) |
| Professional and other outside services |
| 3,952 |
| 3,981 |
| 3,833 |
| 4,660 |
| 3,698 |
| Other expenses |
| 5,934 |
| 7,552 |
| 6,805 |
| 6,347 |
| 7,798 |
| Total Noninterest Expenses |
| 96,935 |
| 108,103 |
| 93,854 |
| 92,593 |
| 93,720 |
| INCOME BEFORE INCOME TAX |
| 54,766 |
| 46,904 |
| 65,371 |
| 71,561 |
| 75,396 |
| Income tax expense |
| 6,825 |
| 4,425 |
| 9,005 |
| 10,699 |
| 11,317 |
| NET INCOME |
| 47,941 |
| 42,479 |
| 56,366 |
| 60,862 |
| 64,079 |
| Preferred stock dividends |
| 469 |
| 469 |
| 468 |
| 469 |
| 469 |
| NET INCOME AVAILABLE TO COMMON STOCKHOLDERS |
| $ |
| 47,472 |
| $ |
| 42,010 |
| $ |
| 55,898 |
| $ |
| 60,393 |
| $ |
| 63,610 |
| Per Share Data: |
| Basic Net Income Available to Common Stockholders |
| $ |
| 0.80 |
| $ |
| 0.71 |
| $ |
| 0.95 |
| $ |
| 1.02 |
| $ |
| 1.07 |
| Diluted Net Income Available to Common Stockholders |
| $ |
| 0.80 |
| $ |
| 0.71 |
| $ |
| 0.94 |
| $ |
| 1.02 |
| $ |
| 1.07 |
| Cash Dividends Paid to Common Stockholders |
| $ |
| 0.34 |
| $ |
| 0.34 |
| $ |
| 0.34 |
| $ |
| 0.34 |
| $ |
| 0.32 |
| Average Diluted Common Shares Outstanding (in thousands) |
| 59,273 |
| 59,556 |
| 59,503 |
| 59,448 |
| 59,441 |
| FINANCIAL RATIOS: |
| Return on Average Assets |
| 1.04 |
| % |
| 0.92 |
| % |
| 1.24 |
| % |
| 1.34 |
| % |
| 1.42 |
| % |
| Return on Average Stockholders' Equity |
| 8.47 |
| 7.89 |
| 10.38 |
| 11.29 |
| 12.21 |
| Return on Tangible Common Stockholders' Equity |
| 13.21 |
| 12.75 |
| 16.54 |
| 18.04 |
| 19.82 |
| Average Earning Assets to Average Assets |
| 92.91 |
| 93.62 |
| 93.36 |
| 93.38 |
| 93.35 |
| Allowance for Credit Losses - Loans as % of Total Loans |
| 1.64 |
| 1.64 |
| 1.67 |
| 1.80 |
| 1.82 |
| Net Charge-offs as % of Average Loans (Annualized) |
| 0.07 |
| 0.10 |
| 0.66 |
| 0.06 |
| 0.01 |
| Average Stockholders' Equity to Average Assets |
| 12.17 |
| 11.58 |
| 11.87 |
| 11.78 |
| 11.56 |
| Tax Equivalent Yield on Average Earning Assets |
| 5.65 |
| 5.64 |
| 5.55 |
| 5.36 |
| 5.06 |
| Interest Expense/Average Earning Assets |
| 2.55 |
| 2.48 |
| 2.26 |
| 1.97 |
| 1.48 |
| Net Interest Margin (FTE) on Average Earning Assets |
| 3.10 |
| 3.16 |
| 3.29 |
| 3.39 |
| 3.58 |
| Efficiency Ratio |
| 59.21 |
| 63.26 |
| 53.91 |
| 52.21 |
| 51.72 |
| Tangible Common Book Value Per Share |
| $ |
| 25.07 |
| $ |
| 25.06 |
| $ |
| 22.43 |
| $ |
| 23.34 |
| $ |
| 22.93 |
| LOANS |
| (Dollars In Thousands) |
| March 31, |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| 2024 |
| 2023 |
| 2023 |
| 2023 |
| 2023 |
| Commercial and industrial loans |
| $ |
| 3,722,365 |
| $ |
| 3,670,948 |
| $ |
| 3,490,953 |
| $ |
| 3,531,395 |
| $ |
| 3,502,204 |
| Agricultural land, production and other loans to farmers |
| 234,431 |
| 263,414 |
| 233,838 |
| 230,003 |
| 219,598 |
| Real estate loans: |
| Construction |
| 941,726 |
| 957,545 |
| 1,022,261 |
| 949,918 |
| 960,979 |
| Commercial real estate, non-owner occupied |
| 2,368,360 |
| 2,400,839 |
| 2,360,596 |
| 2,379,819 |
| 2,375,410 |
| Commercial real estate, owner occupied |
| 1,137,894 |
| 1,162,083 |
| 1,153,707 |
| 1,179,739 |
| 1,244,117 |
| Residential |
| 2,316,490 |
| 2,288,921 |
| 2,257,385 |
| 2,248,473 |
| 2,185,943 |
| Home equity |
| 618,258 |
| 617,571 |
| 609,352 |
| 614,366 |
| 621,354 |
| Individuals' loans for household and other personal expenditures |
| 161,459 |
| 168,388 |
| 176,523 |
| 172,896 |
| 172,389 |
| Public finance and other commercial loans |
| 964,599 |
| 956,318 |
| 966,807 |
| 963,624 |
| 959,467 |
| Loans |
| 12,465,582 |
| 12,486,027 |
| 12,271,422 |
| 12,270,233 |
| 12,241,461 |
| Allowance for credit losses - loans |
| (204,681 |
| ) |
| (204,934 |
| ) |
| (205,782 |
| ) |
| (221,147 |
| ) |
| (223,052 |
| ) |
| NET LOANS |
| $ |
| 12,260,901 |
| $ |
| 12,281,093 |
| $ |
| 12,065,640 |
| $ |
| 12,049,086 |
| $ |
| 12,018,409 |
| DEPOSITS |
| (Dollars In Thousands) |
| March 31, |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| 2024 |
| 2023 |
| 2023 |
| 2023 |
| 2023 |
| Demand deposits |
| $ |
| 7,771,976 |
| $ |
| 7,965,862 |
| $ |
| 7,952,040 |
| $ |
| 8,045,455 |
| $ |
| 8,422,387 |
| Savings deposits |
| 4,679,593 |
| 4,516,433 |
| 4,572,162 |
| 4,530,255 |
| 4,499,487 |
| Certificates and other time deposits of $100,000 or more |
| 1,451,443 |
| 1,408,985 |
| 1,280,607 |
| 1,160,303 |
| 1,040,379 |
| Other certificates and time deposits |
| 901,280 |
| 849,906 |
| 761,196 |
| 680,965 |
| 574,886 |
| Brokered certificates of deposits |
| 80,292 |
| 80,267 |
| 80,571 |
| 164,177 |
| 166,148 |
| TOTAL DEPOSITS |
| $ |
| 14,884,584 |
| $ |
| 14,821,453 |
| $ |
| 14,646,576 |
| $ |
| 14,581,155 |
| $ |
| 14,703,287 |
| CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST MARGIN ANALYSIS |
| (Dollars in Thousands) |
| For the Three Months Ended |
| March 31, 2024 |
| March 31, 2023 |
| Average Balance |
| Interest Income / Expense |
| Average Rate |
| Average Balance |
| Interest Income / Expense |
| Average Rate |
| ASSETS |
| Interest-bearing deposits |
| $ |
| 575,699 |
| $ |
| 6,493 |
| 4.51 |
| % |
| $ |
| 172,814 |
| $ |
| 637 |
| 1.47 |
| % |
| Federal Home Loan Bank stock |
| 41,764 |
| 835 |
| 8.00 |
| 39,759 |
| 542 |
| 5.45 |
| Investment Securities: (1) |
| Taxable |
| 1,783,057 |
| 8,748 |
| 1.96 |
| 1,924,079 |
| 9,087 |
| 1.89 |
| Tax-exempt (2) |
| 2,246,265 |
| 17,229 |
| 3.07 |
| 2,552,371 |
| 20,342 |
| 3.19 |
| Total Investment Securities |
| 4,029,322 |
| 25,977 |
| 2.58 |
| 4,476,450 |
| 29,429 |
| 2.63 |
| Loans held for sale |
| 21,782 |
| 328 |
| 6.02 |
| 23,538 |
| 360 |
| 6.12 |
| Loans: (3) |
| Commercial |
| 8,598,110 |
| 159,209 |
| 7.41 |
| 8,483,879 |
| 139,661 |
| 6.58 |
| Real estate mortgage |
| 2,130,947 |
| 22,357 |
| 4.20 |
| 1,914,640 |
| 18,391 |
| 3.84 |
| Installment |
| 821,815 |
| 16,129 |
| 7.85 |
| 840,450 |
| 13,941 |
| 6.64 |
| Tax-exempt (2) |
| 904,412 |
| 10,367 |
| 4.59 |
| 872,877 |
| 9,758 |
| 4.47 |
| Total Loans |
| 12,477,066 |
| 208,390 |
| 6.68 |
| 12,135,384 |
| 182,111 |
| 6.00 |
| Total Earning Assets |
| 17,123,851 |
| 241,695 |
| 5.65 |
| % |
| 16,824,407 |
| 212,719 |
| 5.06 |
| % |
| Total Non-Earning Assets |
| 1,306,670 |
| 1,197,788 |
| TOTAL ASSETS |
| $ |
| 18,430,521 |
| $ |
| 18,022,195 |
| LIABILITIES |
| Interest-Bearing Deposits: |
| Interest-bearing deposits |
| $ |
| 5,419,821 |
| $ |
| 39,491 |
| 2.91 |
| % |
| $ |
| 5,263,601 |
| $ |
| 24,662 |
| 1.87 |
| % |
| Money market deposits |
| 3,045,478 |
| 27,383 |
| 3.60 |
| 2,746,047 |
| 13,577 |
| 1.98 |
| Savings deposits |
| 1,559,877 |
| 3,801 |
| 0.97 |
| 1,826,209 |
| 2,965 |
| 0.65 |
| Certificates and other time deposits |
| 2,427,859 |
| 27,610 |
| 4.55 |
| 1,466,275 |
| 9,481 |
| 2.59 |
| Total Interest-Bearing Deposits |
| 12,453,035 |
| 98,285 |
| 3.16 |
| 11,302,132 |
| 50,685 |
| 1.79 |
| Borrowings |
| 1,011,812 |
| 10,552 |
| 4.17 |
| 1,293,309 |
| 11,594 |
| 3.59 |
| Total Interest-Bearing Liabilities |
| 13,464,847 |
| 108,837 |
| 3.23 |
| 12,595,441 |
| 62,279 |
| 1.98 |
| Noninterest-bearing deposits |
| 2,428,170 |
| 3,121,277 |
| Other liabilities |
| 295,365 |
| 222,352 |
| Total Liabilities |
| 16,188,382 |
| 15,939,070 |
| STOCKHOLDERS' EQUITY |
| 2,242,139 |
| 2,083,125 |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
| $ |
| 18,430,521 |
| 108,837 |
| $ |
| 18,022,195 |
| 62,279 |
| Net Interest Income (FTE) |
| $ |
| 132,858 |
| $ |
| 150,440 |
| Net Interest Spread (FTE) (4) |
| 2.42 |
| % |
| 3.08 |
| % |
| Net Interest Margin (FTE): |
| Interest Income (FTE) / Average Earning Assets |
| 5.65 |
| % |
| 5.06 |
| % |
| Interest Expense / Average Earning Assets |
| 2.55 |
| % |
| 1.48 |
| % |
| Net Interest Margin (FTE) (5) |
| 3.10 |
| % |
| 3.58 |
| % |
| (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 $5,795 and $6,321 for the three months ended March 31, 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 Ended |
| March 31, |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| 2024 |
| 2023 |
| 2023 |
| 2023 |
| 2023 |
| Net Income Available to Common Stockholders - GAAP |
| $ |
| 47,472 |
| $ |
| 42,010 |
| $ |
| 55,898 |
| $ |
| 60,393 |
| $ |
| 63,610 |
| Adjustments: |
| PPP loan income |
| — |
| (7 |
| ) |
| (8 |
| ) |
| (9 |
| ) |
| (25 |
| ) |
| Non-core expenses 1,2 |
| 3,481 |
| 12,682 |
| — |
| — |
| — |
| Tax on adjustments |
| (848 |
| ) |
| (3,088 |
| ) |
| 2 |
| 2 |
| 6 |
| Adjusted Net Income Available to Common Stockholders - Non-GAAP |
| $ |
| 50,105 |
| $ |
| 51,597 |
| $ |
| 55,892 |
| $ |
| 60,386 |
| $ |
| 63,591 |
| Average Diluted Common Shares Outstanding (in thousands) |
| 59,273 |
| 59,556 |
| 59,503 |
| 59,448 |
| 59,441 |
| Diluted Earnings Per Common Share - GAAP |
| $ |
| 0.80 |
| $ |
| 0.71 |
| $ |
| 0.94 |
| $ |
| 1.02 |
| $ |
| 1.07 |
| Adjustments: |
| PPP loan income |
| — |
| — |
| — |
| — |
| — |
| Non-core expenses 1,2 |
| 0.06 |
| 0.21 |
| — |
| — |
| — |
| Tax on adjustments |
| (0.01 |
| ) |
| (0.05 |
| ) |
| — |
| — |
| — |
| Adjusted Diluted Earnings Per Common Share - Non-GAAP |
| $ |
| 0.85 |
| $ |
| 0.87 |
| $ |
| 0.94 |
| $ |
| 1.02 |
| $ |
| 1.07 |
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.
| RETURN ON TANGIBLE COMMON EQUITY - NON-GAAP |
| (Dollars In Thousands) |
| Three Months Ended |
| March 31, |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| 2024 |
| 2023 |
| 2023 |
| 2023 |
| 2023 |
| Total Average Stockholders' Equity (GAAP) |
| $ |
| 2,242,139 |
| $ |
| 2,130,993 |
| $ |
| 2,154,232 |
| $ |
| 2,139,877 |
| $ |
| 2,083,125 |
| Less: Average Preferred Stock |
| (25,125 |
| ) |
| (25,125 |
| ) |
| (25,125 |
| ) |
| (25,125 |
| ) |
| (25,125 |
| ) |
| Less: Average Intangible Assets, Net of Tax |
| (732,432 |
| ) |
| (734,007 |
| ) |
| (735,787 |
| ) |
| (737,489 |
| ) |
| (739,190 |
| ) |
| Average Tangible Common Equity, Net of Tax (Non-GAAP) |
| $ |
| 1,484,582 |
| $ |
| 1,371,861 |
| $ |
| 1,393,320 |
| $ |
| 1,377,263 |
| $ |
| 1,318,810 |
| Net Income Available to Common Stockholders (GAAP) |
| $ |
| 47,472 |
| $ |
| 42,010 |
| $ |
| 55,898 |
| $ |
| 60,393 |
| $ |
| 63,610 |
| Plus: Intangible Asset Amortization, Net of Tax |
| 1,546 |
| 1,724 |
| 1,724 |
| 1,724 |
| 1,734 |
| Tangible Net Income (Non-GAAP) |
| $ |
| 49,018 |
| $ |
| 43,734 |
| $ |
| 57,622 |
| $ |
| 62,117 |
| $ |
| 65,344 |
| Return on Tangible Common Equity (Non-GAAP) |
| 13.21 |
| % |
| 12.75 |
| % |
| 16.54 |
| % |
| 18.04 |
| % |
| 19.82 |
| % |