First Merchants Corporation Announces Third Quarter 2025 Earnings per Share

10/22/25 4:05:34 PM ET

$FRME

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MUNCIE, Ind., Oct. 22, 2025 (GLOBE NEWSWIRE) -- First Merchants Corporation (NASDAQ - FRME) (the "Corporation")

Third Quarter 2025 Highlights:

Net income available to common stockholders was $56.3 million and diluted earnings per common share totaled $0.98 in the third quarter of 2025, compared to $48.7 million and $0.84 in the third quarter of 2024, and $56.4 million and $0.98 in the second quarter of 2025.
Robust capital position with Common Equity Tier 1 Capital Ratio of 11.34% and Tangible Common Equity to Tangible Assets Ratio of 9.18%.
Repurchased 939,271 shares totaling $36.5 million year-to-date; repurchased 162,474 shares totaling $6.5 million during the third quarter.
Total loans grew $288.8 million, or 8.7% annualized, on a linked quarter basis, and $926.9 million, or 7.3%, during the last twelve months.
Total deposits increased $72.4 million, or 2.0% annualized, on a linked quarter basis.
Nonperforming assets to total assets were 36 basis points and flat compared to prior quarter.
The efficiency ratio totaled 55.09% for the quarter or 54.56%¹ excluding $0.9 million of non-core charges incurred during the quarter.
Announced the acquisition of First Savings Financial Group, Inc. on September 25, 2025, adding approximately $2.4 billion in assets and expanding the Corporation's presence into Southern Indiana and the Louisville MSA.

"Our strong year-to-date balance sheet and earnings performance underscore the strength and resilience of our business model. Our return on assets, return on tangible capital, and efficiency ratio are in the top-quartile relative to our peers, reflecting disciplined execution and operational excellence," said Mark Hardwick, Chief Executive Officer. "The pending acquisition of First Savings Financial Group marks a strategic expansion into Southern Indiana and the Louisville metropolitan area, adding approximately $2.4 billion in assets and enhancing our ability to serve Indiana, Ohio, and Michigan while delivering sustainable long-term growth."

Third Quarter Financial Results:

First Merchants Corporation (the "Corporation") reported third quarter 2025 net income available to common stockholders of $56.3 million compared to $48.7 million during the same period in 2024. Diluted earnings per common share for the period totaled $0.98 compared to $0.84 in the third quarter of 2024. Adjusted diluted earnings per common share¹ for the third quarter 2025 totaled $0.99, up from $0.95 in the prior year period. Third quarter 2025 results included $0.9 million in pre-tax acquisition-related and other non-core expenses, while the third quarter 2024 included a $9.1 million pre-tax loss related to the repositioning of the available-for-sale securities portfolio.

On September 25, 2025, the Corporation signed a definitive agreement to acquire First Savings Financial Group, Inc., ("First Savings"), in an all-stock transaction that was valued at approximately $241.3 million on the day of announcement. Headquartered in Jeffersonville, Indiana, First Savings operates 16 banking center locations in southern Indiana. First Savings had total assets of $2.4 billion, total loans of $1.9 billion, and total deposits of $1.7 billion as of June 30, 2025. The transaction is expected to close in the first quarter of 2026.

Total assets of the Corporation equaled $18.8 billion as of quarter-end and loans totaled $13.6 billion. During the past twelve months, total loans grew by $926.9 million, or 7.3%. On a linked quarter basis, loans grew $288.8 million, or 8.7% annualized, with growth primarily in Commercial & Industrial loans.

Investments, totaling $3.4 billion, decreased $279.8 million, or 7.6%, during the last twelve months and increased $1.4 million on a linked quarter basis. The modest increase during the quarter was due to an increase in the securities portfolio valuation offset by principal paydowns and maturities.

Total deposits equaled $14.9 billion as of quarter-end and increased by $504.9 million, or 3.5%, over the past twelve months. On a linked quarter basis, deposits increased $72.4 million, or 2.0% annualized. The loan to deposit ratio increased to 91.6% at period end from 90.1% in the prior quarter.

The Corporation's Allowance for Credit Losses – Loans (ACL) totaled $194.5 million as of quarter-end, or 1.43% of total loans, a decrease of $0.8 million from prior quarter. Net charge-offs totaled $5.1 million and provision for credit losses of $4.3 million was recorded during the quarter. Reserves for unfunded commitments totaled $18.0 million and remained unchanged from the prior quarter. Non-performing assets to total assets were 0.36% for the third quarter of 2025, consistent with the prior quarter, reflecting continued strong credit performance.

Net interest income, totaling $133.7 million for the quarter, increased $0.7 million, or 0.5%, compared to prior quarter and increased $2.6 million, or 1.9%, compared to the third quarter of 2024. Fully tax equivalent net interest margin was 3.24%, a decrease of one basis point compared to prior quarter, and an increase of one basis point compared to the third quarter of 2024.

Noninterest income totaled $32.5 million for the quarter, an increase of $1.2 million, or 3.8%, compared to the second quarter of 2025 and an increase of $7.6 million, or 30.6%, from the third quarter of 2024. The increase over second quarter of 2025 was driven primarily by the recording of a $0.9 million negative valuation adjustment to a CRA investment in the second quarter. Customer related fees were stable on a linked quarter basis. The increase from the third quarter of 2024 was driven by realized losses of $9.1 million on sales of available for sale securities recorded in the third quarter of the prior year.

Noninterest expense totaled $96.6 million for the quarter, an increase of $3.0 million from the second quarter of 2025 and an increase of $1.9 million from the third quarter of 2024. The linked quarter increase was driven by higher salaries and incentives and $0.6 million of severance.

The Corporation's total risk-based capital ratio equaled 13.04%, common equity tier 1 capital ratio equaled 11.34%, and the tangible common equity ratio totaled 9.18%. These ratios continue to reflect the Corporation's robust capital position.

¹ See "Non-GAAP Financial Information" for reconciliation

CONFERENCE CALL

First Merchants Corporation will conduct a third quarter earnings conference call and webcast at 9:00 a.m. (ET) on Thursday, October 23, 2025.

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-conf.media-server.com/register/BIf471933f076b43ed86fc41e507892de6)

To view the webcast and presentation slides, please go to (https://edge.media-server.com/mmc/p/b8bccx5o) during the time of the call. A replay of the webcast will be available until October 23, 2026.

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 news 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 forward- looking statements include, but are not limited to, statements relating to the expected timing and benefits of the proposed merger between First Merchants and First Savings, including future financial and operating results, cost savings, enhanced revenues, and accretion/dilution to reported earnings that may be realized from the proposed merger, as well as other statements of expectations regarding the proposed merger, and other 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, whether with respect to the proposed merger or otherwise. 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: the risk that the businesses of First Merchants and First Savings will not be integrated successfully or such integration may be more difficult, time-consuming or costly than expected; expected revenue synergies and cost savings from the proposed merger may not be fully realized or realized within the expected time frame; revenues following the proposed merger may be lower than expected; customer and employee relationships and business operations may be disrupted by the proposed merger; the ability to obtain required regulatory approvals or the approval of First Savings' common shareholders, and the ability to complete the proposed merger on the expected timeframe; 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 First Merchants' business; the impacts of epidemics, pandemics or other infectious disease outbreaks; and other risks and factors identified in each of First Merchants' filings with the SEC. Neither First Merchants nor First Savings undertakes any obligation to update any forward-looking statement, whether written or oral, relating to the matters discussed in this news release. In addition, the companies' respective past results of operations do not necessarily indicate their anticipated future results, whether or not the proposed merger is completed.


CONSOLIDATED BALANCE SHEETS (Unaudited)
(Dollars In Thousands, Except Per Share Amounts)	September 30,
		2025			2024
ASSETS
Cash and due from banks	$	88,079		$	84,719
Interest-bearing deposits		168,706			359,126
Investment securities available for sale		1,386,903			1,553,496
Investment securities held to maturity, net of allowance for credit losses		1,995,488			2,108,649
Loans held for sale		23,190			40,652
Loans		13,591,174			12,646,808
Less: Allowance for credit losses - loans		(194,468	)		(187,828	)
Net loans		13,396,706			12,458,980
Premises and equipment		121,771			129,582
Federal Home Loan Bank stock		47,264			41,716
Interest receivable		89,102			92,055
Goodwill		712,002			712,002
Other intangibles		15,298			21,599
Cash surrender value of life insurance		306,583			304,613
Other real estate owned		1,270			5,247
Tax asset, deferred and receivable		89,758			86,732
Other assets		369,509			348,384
TOTAL ASSETS	$	18,811,629		$	18,347,552
LIABILITIES
Deposits:
Noninterest-bearing	$	2,100,570		$	2,334,197
Interest-bearing		12,769,409			12,030,903
Total Deposits		14,869,979			14,365,100
Borrowings:
Federal funds purchased		199,370			30,000
Securities sold under repurchase agreements		122,226			124,894
Federal Home Loan Bank advances		798,626			832,629
Subordinated debentures and other borrowings		57,632			93,562
Total Borrowings		1,177,854			1,081,085
Deposits and other liabilities held for sale		—			288,476
Interest payable		18,240			18,089
Other liabilities		333,154			292,429
Total Liabilities		16,399,227			16,045,179
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, $0.125 stated value:
Authorized -- 100,000,000 shares Issued and outstanding - 57,192,497 and 58,117,115 shares		7,149			7,265
Additional paid-in capital		1,158,026			1,192,683
Retained earnings		1,377,966			1,229,125
Accumulated other comprehensive loss		(155,864	)		(151,825	)
Total Stockholders' Equity		2,412,402			2,302,373
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	18,811,629		$	18,347,552


CONSOLIDATED STATEMENTS OF INCOME (Unaudited)	Three Months Ended					Nine Months Ended
(Dollars In Thousands, Except Per Share Amounts)	September 30,					September 30,
	2025			2024			2025			2024
INTEREST INCOME
Loans:
Taxable	$	200,406	$	206,680		$	583,307		$	606,116
Tax-exempt		11,173		8,622			32,510			25,242
Investment securities:
Taxable		8,288		9,263			24,926			27,062
Tax-exempt		12,460		13,509			37,493			40,733
Deposits with financial institutions		1,676		2,154			5,940			11,642
Federal Home Loan Bank stock		1,092		855			3,172			2,569
Total Interest Income		235,095		241,083			687,348			713,364
INTEREST EXPENSE
Deposits		90,821		98,856			255,609			296,292
Federal funds purchased		224		329			2,001			455
Securities sold under repurchase agreements		654		700			2,059			2,377
Federal Home Loan Bank advances		8,638		8,544			27,716			21,715
Subordinated debentures and other borrowings		1,093		1,544			3,014			5,781
Total Interest Expense		101,430		109,973			290,399			326,620
NET INTEREST INCOME		133,665		131,110			396,949			386,744
Provision for credit losses		4,300		5,000			14,100			31,500
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES		129,365		126,110			382,849			355,244
NONINTEREST INCOME
Service charges on deposit accounts		8,921		8,361			25,559			24,482
Fiduciary and wealth management fees		8,842		8,525			26,317			25,550
Card payment fees		5,007		5,121			14,465			14,360
Net gains and fees on sales of loans		4,983		6,764			15,854			15,159
Derivative hedge fees		1,097		736			2,332			1,488
Other customer fees		414		344			1,230			1,231
Earnings on bank-owned life insurance		1,667		2,755			5,759			6,276
Net realized losses on sales of available for sale securities		—		(9,114	)		(8	)		(9,165	)
Other income		1,546		1,374			2,320			3,457
Total Noninterest Income		32,477		24,866			93,828			82,838
NONINTEREST EXPENSES
Salaries and employee benefits		57,317		55,223			166,826			165,730
Net occupancy		7,057		6,994			21,118			21,052
Equipment		6,998		6,949			20,933			19,774
Marketing		2,120		1,836			5,470			4,807
Outside data processing fees		6,943		7,150			19,979			21,111
Printing and office supplies		311		378			930			1,085
Intangible asset amortization		1,499		1,772			4,530			5,500
FDIC assessments		3,526		3,720			10,726			11,285
Other real estate owned and foreclosure expenses		121		942			750			1,849
Professional and other outside services		3,718		3,035			10,720			10,809
Other expenses		6,951		6,630			21,079			19,975
Total Noninterest Expenses		96,561		94,629			283,061			282,977
INCOME BEFORE INCOME TAX		65,281		56,347			193,616			155,105
Income tax expense		8,516		7,160			24,680			18,052
NET INCOME		56,765		49,187			168,936			137,053
Preferred stock dividends		468		468			1,406			1,406
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS	$	56,297	$	48,719		$	167,530		$	135,647

PER SHARE DATA:
Basic Net Income Available to Common Stockholders	$	0.98	$	0.84		$	2.91		$	2.32
Diluted Net Income Available to Common Stockholders	$	0.98	$	0.84		$	2.90		$	2.31
Cash Dividends Paid to Common Stockholders	$	0.36	$	0.35		$	1.07		$	1.04
Tangible Common Book Value Per Share	$	29.08	$	26.64		$	29.08		$	26.64
Average Diluted Common Shares Outstanding (in thousands)		57,448		58,289			57,817			58,629

FINANCIAL HIGHLIGHTS
(Dollars In Thousands)	Three Months Ended						Nine Months Ended
	September 30,						September 30,
		2025			2024			2025			2024
NET CHARGE-OFFS	$	5,148		$	6,709		$	12,389		$	48,606

AVERAGE BALANCES:
Total Assets	$	18,637,581		$	18,360,580		$	18,497,118		$	18,374,370
Total Loans		13,402,379			12,680,166			13,186,843			12,592,907
Total Earning Assets		17,282,901			16,990,358			17,135,301			17,042,540
Total Deposits		14,907,861			14,702,454			14,654,894			14,826,056
Total Stockholders' Equity		2,367,971			2,251,547			2,349,718			2,232,419

FINANCIAL RATIOS:
Return on Average Assets		1.22	%		1.07	%		1.22	%		0.99	%
Return on Average Stockholders' Equity		9.51			8.66			9.51			8.10
Return on Tangible Common Stockholders' Equity		14.21			13.39			14.27			12.64
Average Earning Assets to Average Assets		92.73			92.54			92.64			92.75
Allowance for Credit Losses - Loans as % of Total Loans		1.43			1.48			1.43			1.48
Net Charge-offs as % of Average Loans (Annualized)		0.15			0.21			0.13			0.51
Average Stockholders' Equity to Average Assets		12.71			12.26			12.70			12.15
Fully Taxable Equivalent (FTE) Yield on Average Earning Assets		5.58			5.82			5.49			5.72
Interest Expense/Average Earning Assets		2.34			2.59			2.26			2.56
Net Interest Margin FTE		3.24			3.23			3.23			3.16
Efficiency Ratio		55.09			53.76			54.54			55.54


ASSET QUALITY
(Dollars In Thousands)	September 30,			June 30,			March 31,			December 31,			September 30,
		2025			2025			2025			2024			2024
Nonaccrual Loans	$	65,740		$	67,358		$	81,922		$	73,773		$	59,088
Other Real Estate Owned and Repossessions		1,270			177			4,966			4,948			5,247
Nonperforming Assets (NPA)		67,010			67,535			86,888			78,721			64,335
90+ Days Delinquent		1,925			4,443			4,280			5,902			14,105
NPAs & 90+ Days Delinquent	$	68,935		$	71,978		$	91,168		$	84,623		$	78,440

Allowance for Credit Losses - Loans	$	194,468		$	195,316		$	192,031		$	192,757		$	187,828
Quarterly Net Charge-offs		5,148			2,315			4,926			771			6,709
NPAs / Actual Assets %		0.36	%		0.36	%		0.47	%		0.43	%		0.35	%
NPAs & 90 Day / Actual Assets %		0.37	%		0.39	%		0.49	%		0.46	%		0.43	%
NPAs / Actual Loans and OREO %		0.49	%		0.51	%		0.67	%		0.61	%		0.51	%
Allowance for Credit Losses - Loans / Actual Loans (%)		1.43	%		1.47	%		1.47	%		1.50	%		1.48	%
Quarterly Net Charge-offs as % of Average Loans (Annualized)		0.15	%		0.07	%		0.15	%		0.02	%		0.21	%

CONSOLIDATED BALANCE SHEETS (Unaudited)
(Dollars In Thousands, Except Per Share Amounts)	September 30,			June 30,			March 31,			December 31,			September 30,
		2025			2025			2025			2024			2024
ASSETS
Cash and due from banks	$	88,079		$	81,567		$	86,113		$	87,616		$	84,719
Interest-bearing deposits		168,706			223,343			331,534			298,891			359,126
Investment securities available for sale		1,386,903			1,358,130			1,378,489			1,386,475			1,553,496
Investment securities held to maturity, net of allowance for credit losses		1,995,488			2,022,826			2,048,632			2,074,220			2,108,649
Loans held for sale		23,190			28,783			23,004			18,663			40,652
Loans		13,591,174			13,296,759			13,004,905			12,854,359			12,646,808
Less: Allowance for credit losses - loans		(194,468	)		(195,316	)		(192,031	)		(192,757	)		(187,828	)
Net loans		13,396,706			13,101,443			12,812,874			12,661,602			12,458,980
Premises and equipment		121,771			122,808			128,749			129,743			129,582
Federal Home Loan Bank stock		47,264			47,290			45,006			41,690			41,716
Interest receivable		89,102			93,258			88,352			91,829			92,055
Goodwill		712,002			712,002			712,002			712,002			712,002
Other intangibles		15,298			16,797			18,302			19,828			21,599
Cash surrender value of life insurance		306,583			305,695			304,918			304,906			304,613
Other real estate owned		1,270			177			4,966			4,948			5,247
Tax asset, deferred and receivable		89,758			97,749			87,665			92,387			86,732
Other assets		369,509			380,909			369,181			387,169			348,384
TOTAL ASSETS	$	18,811,629		$	18,592,777		$	18,439,787		$	18,311,969		$	18,347,552
LIABILITIES
Deposits:
Noninterest-bearing	$	2,100,570		$	2,197,416		$	2,185,057		$	2,325,579		$	2,334,197
Interest-bearing		12,769,409			12,600,162			12,276,921			12,196,047			12,030,903
Total Deposits		14,869,979			14,797,578			14,461,978			14,521,626			14,365,100
Borrowings:
Federal funds purchased		199,370			85,000			185,000			99,226			30,000
Securities sold under repurchase agreements		122,226			114,758			122,947			142,876			124,894
Federal Home Loan Bank advances		798,626			898,702			972,478			822,554			832,629
Subordinated debentures and other borrowings		57,632			62,617			62,619			93,529			93,562
Total Borrowings		1,177,854			1,161,077			1,343,044			1,158,185			1,081,085
Deposits and other liabilities held for sale		—			—			—			—			288,476
Interest payable		18,240			16,174			13,304			16,102			18,089
Other liabilities		333,154			269,996			289,247			311,073			292,429
Total Liabilities		16,399,227			16,244,825			16,107,573			16,006,986			16,045,179
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, $0.125 stated value:
Authorized -- 100,000,000 shares Issued and outstanding		7,149			7,159			7,226			7,247			7,265
Additional paid-in capital		1,158,026			1,163,170			1,183,263			1,188,768			1,192,683
Retained earnings		1,377,966			1,342,473			1,306,911			1,272,528			1,229,125
Accumulated other comprehensive loss		(155,864	)		(189,975	)		(190,311	)		(188,685	)		(151,825	)
Total Stockholders' Equity		2,412,402			2,347,952			2,332,214			2,304,983			2,302,373
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	18,811,629		$	18,592,777		$	18,439,787		$	18,311,969		$	18,347,552

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(Dollars In Thousands, Except Per Share Amounts)	September 30,			June 30,			March 31,			December 31,			September 30,
		2025			2025			2025			2024			2024
INTEREST INCOME
Loans:
Taxable	$	200,406		$	195,173		$	187,728		$	197,536		$	206,680
Tax-exempt		11,173			10,805			10,532			9,020			8,622
Investment securities:
Taxable		8,288			8,266			8,372			9,024			9,263
Tax-exempt		12,460			12,516			12,517			12,754			13,509
Deposits with financial institutions		1,676			1,892			2,372			5,350			2,154
Federal Home Loan Bank stock		1,092			1,083			997			958			855
Total Interest Income		235,095			229,735			222,518			234,642			241,083
INTEREST EXPENSE
Deposits		90,821			84,241			80,547			89,835			98,856
Federal funds purchased		224			965			812			26			329
Securities sold under repurchase agreements		654			663			742			680			700
Federal Home Loan Bank advances		8,638			9,714			9,364			8,171			8,544
Subordinated debentures and other borrowings		1,093			1,138			783			1,560			1,544
Total Interest Expense		101,430			96,721			92,248			100,272			109,973
NET INTEREST INCOME		133,665			133,014			130,270			134,370			131,110
Provision for credit losses		4,300			5,600			4,200			4,200			5,000
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES		129,365			127,414			126,070			130,170			126,110
NONINTEREST INCOME
Service charges on deposit accounts		8,921			8,566			8,072			8,124			8,361
Fiduciary and wealth management fees		8,842			8,831			8,644			8,665			8,525
Card payment fees		5,007			4,932			4,526			4,957			5,121
Net gains and fees on sales of loans		4,983			5,849			5,022			5,681			6,764
Derivative hedge fees		1,097			831			404			1,594			736
Other customer fees		414			401			415			316			344
Earnings on bank-owned life insurance		1,667			1,913			2,179			2,188			2,755
Net realized losses on sales of available for sale securities		—			(1	)		(7	)		(11,592	)		(9,114	)
Gain on branch sale		—			—			—			19,983			—
Other income (loss)		1,546			(19	)		793			2,826			1,374
Total Noninterest Income		32,477			31,303			30,048			42,742			24,866
NONINTEREST EXPENSES
Salaries and employee benefits		57,317			54,527			54,982			55,437			55,223
Net occupancy		7,057			6,845			7,216			7,335			6,994
Equipment		6,998			6,927			7,008			7,028			6,949
Marketing		2,120			1,997			1,353			2,582			1,836
Outside data processing fees		6,943			7,107			5,929			6,029			7,150
Printing and office supplies		311			272			347			377			378
Intangible asset amortization		1,499			1,505			1,526			1,771			1,772
FDIC assessments		3,526			3,552			3,648			3,744			3,720
Other real estate owned and foreclosure expenses		121			29			600			227			942
Professional and other outside services		3,718			3,741			3,261			3,777			3,035
Other expenses		6,951			7,096			7,032			7,982			6,630
Total Noninterest Expenses		96,561			93,598			92,902			96,289			94,629
INCOME BEFORE INCOME TAX		65,281			65,119			63,216			76,623			56,347
Income tax expense		8,516			8,287			7,877			12,274			7,160
NET INCOME		56,765			56,832			55,339			64,349			49,187
Preferred stock dividends		468			469			469			469			468
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS	$	56,297		$	56,363		$	54,870		$	63,880		$	48,719
PER SHARE DATA:
Basic Net Income Available to Common Stockholders	$	0.98		$	0.98		$	0.95		$	1.10		$	0.84
Diluted Net Income Available to Common Stockholders	$	0.98		$	0.98		$	0.94		$	1.10		$	0.84
Cash Dividends Paid to Common Stockholders	$	0.36		$	0.36		$	0.35		$	0.35		$	0.35
Tangible Common Book Value Per Share	$	29.08		$	27.90		$	27.34		$	26.78		$	26.64
Average Diluted Common Shares Outstanding (in thousands)		57,448			57,773			58,242			58,247			58,289
FINANCIAL RATIOS:
Return on Average Assets		1.22	%		1.23	%		1.21	%		1.39	%		1.07	%
Return on Average Stockholders' Equity		9.51			9.63			9.38			11.05			8.66
Return on Tangible Common Stockholders' Equity		14.21			14.49			14.12			16.75			13.39
Average Earning Assets to Average Assets		92.73			92.71			92.47			92.48			92.54
Allowance for Credit Losses - Loans as % of Total Loans		1.43			1.47			1.47			1.50			1.48
Net Charge-offs as % of Average Loans (Annualized)		0.15			0.07			0.15			0.02			0.21
Average Stockholders' Equity to Average Assets		12.71			12.64			12.76			12.51			12.26
Fully Taxable Equivalent (FTE) Yield on Average Earning Assets		5.58			5.50			5.39			5.63			5.82
Interest Expense/Average Earning Assets		2.34			2.25			2.17			2.35			2.59
Net Interest Margin FTE		3.24			3.25			3.22			3.28			3.23
Efficiency Ratio		55.09			53.99			54.54			48.48			53.76

LOANS
(Dollars In Thousands)	September 30,			June 30,			March 31,			December 31,			September 30,
		2025			2025			2025			2024			2024
Commercial and industrial loans	$	4,604,895		$	4,440,924		$	4,306,597		$	4,114,292		$	4,041,217
Agricultural land, production and other loans to farmers		275,817			265,172			243,864			256,312			238,743
Real estate loans:
Construction		789,021			836,033			793,175			792,144			814,704
Commercial real estate, non-owner occupied		2,304,889			2,171,092			2,177,869			2,274,016			2,251,351
Commercial real estate, owner occupied		1,232,117			1,226,797			1,214,739			1,157,944			1,152,751
Residential		2,412,783			2,397,094			2,389,852			2,374,729			2,366,943
Home equity		687,021			673,961			650,499			659,811			641,188
Individuals' loans for household and other personal expenditures		138,703			141,045			140,954			166,028			158,480
Public finance and other commercial loans		1,145,928			1,144,641			1,087,356			1,059,083			981,431
Loans		13,591,174			13,296,759			13,004,905			12,854,359			12,646,808
Allowance for credit losses - loans		(194,468	)		(195,316	)		(192,031	)		(192,757	)		(187,828	)
NET LOANS	$	13,396,706		$	13,101,443		$	12,812,874		$	12,661,602		$	12,458,980

DEPOSITS
(Dollars In Thousands)	September 30,		June 30,		March 31,		December 31,		September 30,
	2025		2025		2025		2024		2024
Demand deposits	$	7,645,698	$	7,798,695	$	7,786,554	$	7,980,061	$	7,678,510
Savings deposits		5,164,707		4,984,659		4,791,874		4,522,758		4,302,236
Certificates and other time deposits of $100,000 or less		627,828		617,857		625,203		692,068		802,949
Certificates and other time deposits of $100,000 or more		910,337		891,139		896,143		1,043,068		1,277,833
Brokered certificates of deposits¹		521,409		505,228		362,204		283,671		303,572
TOTAL DEPOSITS	$	14,869,979	$	14,797,578	$	14,461,978	$	14,521,626	$	14,365,100

^{1 -} Total brokered deposits of $1.3 billion, which includes brokered CD's of $521.4 million at September 30, 2025.


CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST MARGIN ANALYSIS
(Dollars In Thousands)
	Three Months Ended
	September 30, 2025						September 30, 2024
	Average Balance		Interest Income / Expense		Average Rate		Average Balance		Interest Income / Expense		Average Rate
ASSETS
Interest-bearing deposits	$	229,271	$	1,676	2.92	%	$	252,113	$	2,154	3.42	%
Federal Home Loan Bank stock		47,278		1,092	9.24			41,730		855	8.20
Investment Securities: ⁽¹⁾
Taxable		1,567,594		8,288	2.11			1,789,526		9,263	2.07
Tax-exempt ⁽²⁾		2,036,379		15,772	3.10			2,226,823		17,100	3.07
Total Investment Securities		3,603,973		24,060	2.67			4,016,349		26,363	2.63
Loans held for sale		26,165		401	6.13			31,991		483	6.04
Loans: ⁽³⁾
Commercial		9,165,241		158,469	6.92			8,699,733		164,922	7.58
Real estate mortgage		2,217,524		25,676	4.63			2,183,095		24,333	4.46
HELOC and installment		851,239		15,860	7.45			832,222		16,942	8.14
Tax-exempt ⁽²⁾		1,142,210		14,070	4.93			933,125		10,914	4.68
Total Loans		13,402,379		214,476	6.40			12,680,166		217,594	6.86
Total Earning Assets		17,282,901		241,304	5.58	%		16,990,358		246,966	5.82	%
Total Non-Earning Assets		1,354,680						1,370,222
TOTAL ASSETS	$	18,637,581					$	18,360,580
LIABILITIES
Interest-Bearing Deposits:
Interest-bearing deposits	$	5,600,373	$	37,463	2.68	%	$	5,455,298	$	40,450	2.97	%
Money market deposits		3,843,537		31,709	3.30			2,974,188		25,950	3.49
Savings deposits		1,269,539		2,605	0.82			1,425,047		4,208	1.18
Certificates and other time deposits		2,036,704		19,044	3.74			2,499,655		28,248	4.52
Total Interest-Bearing Deposits		12,750,153		90,821	2.85			12,354,188		98,856	3.20
Borrowings		1,072,145		10,609	3.96			1,071,440		11,117	4.15
Total Interest-Bearing Liabilities		13,822,298		101,430	2.94			13,425,628		109,973	3.28
Noninterest-bearing deposits		2,157,708						2,348,266
Other liabilities		289,604						335,139
Total Liabilities		16,269,610						16,109,033
STOCKHOLDERS' EQUITY		2,367,971						2,251,547
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	18,637,581					$	18,360,580
Net Interest Income (FTE)			$	139,874					$	136,993
Net Interest Spread (FTE) ⁽⁴⁾					2.64	%					2.54	%

Net Interest Margin (FTE):
Interest Income (FTE) / Average Earning Assets					5.58	%					5.82	%
Interest Expense / Average Earning Assets					2.34	%					2.59	%
Net Interest Margin (FTE) ⁽⁵⁾					3.24	%					3.23	%

⁽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 2025 and 2024. These totals equal $6,209 and $5,883 for the three months ended September 30, 2025 and 2024, 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)
	Nine Months Ended
	September 30, 2025						September 30, 2024
	Average Balance		Interest Income / Expense		Average Rate		Average Balance		Interest Income / Expense		Average Rate
ASSETS
Interest-bearing deposits	$	258,396	$	5,940	3.07	%	$	383,007	$	11,642	4.05	%
Federal Home Loan Bank stock		45,964		3,172	9.20			41,748		2,569	8.20
Investment Securities: ⁽¹⁾
Taxable		1,602,343		24,926	2.07			1,787,119		27,062	2.02
Tax-exempt ⁽²⁾		2,041,755		47,459	3.10			2,237,759		51,561	3.07
Total Investment Securities		3,644,098		72,385	2.65			4,024,878		78,623	2.60
Loans held for sale		24,175		1,109	6.12			27,735		1,242	5.97
Loans: ⁽³⁾
Commercial		8,982,171		460,349	6.83			8,659,088		484,979	7.47
Real estate mortgage		2,203,263		75,184	4.55			2,159,738		70,489	4.35
HELOC and installment		838,420		46,665	7.42			825,060		49,406	7.98
Tax-exempt ⁽²⁾		1,138,814		41,079	4.81			921,286		31,952	4.62
Total Loans		13,186,843		624,386	6.31			12,592,907		638,068	6.76
Total Earning Assets		17,135,301		705,883	5.49	%		17,042,540		730,902	5.72	%
Total Non-Earning Assets		1,361,817						1,331,830
TOTAL ASSETS	$	18,497,118					$	18,374,370
LIABILITIES
Interest-Bearing deposits:
Interest-bearing deposits	$	5,556,274	$	107,372	2.58	%	$	5,487,106	$	120,935	2.94	%
Money market deposits		3,633,314		86,375	3.17			3,018,526		80,563	3.56
Savings deposits		1,283,856		7,563	0.79			1,497,620		11,485	1.02
Certificates and other time deposits		1,996,406		54,299	3.63			2,447,684		83,309	4.54
Total Interest-Bearing Deposits		12,469,850		255,609	2.73			12,450,936		296,292	3.17
Borrowings		1,194,498		34,790	3.88			990,022		30,328	4.08
Total Interest-Bearing Liabilities		13,664,348		290,399	2.83			13,440,958		326,620	3.24
Noninterest-bearing deposits		2,185,044						2,375,120
Other liabilities		298,008						325,873
Total Liabilities		16,147,400						16,141,951
STOCKHOLDERS' EQUITY		2,349,718						2,232,419
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	18,497,118					$	18,374,370
Net Interest Income (FTE)			$	415,484					$	404,282
Net Interest Spread (FTE) ⁽⁴⁾					2.66	%					2.48	%

Net Interest Margin (FTE):
Interest Income (FTE) / Average Earning Assets					5.49	%					5.72	%
Interest Expense / Average Earning Assets					2.26	%					2.56	%
Net Interest Margin (FTE) ⁽⁵⁾					3.23	%					3.16	%

⁽¹⁾ Average balance of securities is computed based on the average of the historical amortized cost balances without the effects of the fair value adjustments. Annualized amounts are computed using a 30/360 day basis.
⁽²⁾ Tax-exempt securities and loans are presented on a fully taxable equivalent basis, using a marginal tax rate of 21 percent for 2025 and 2024. These totals equal $18,535 and $17,538 for the nine months ended September 30, 2025 and 2024, 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														Nine Months Ended
	September 30,			June 30,		March 31,			December 31,			September 30,			September 30,			September 30,
		2025			2025		2025			2024			2024			2025			2024
Net Income Available to Common Stockholders - GAAP	$	56,297		$	56,363	$	54,870		$	63,880		$	48,719		$	167,530		$	135,647
Adjustments:
Net realized losses on sales of available for sale securities		—			1		7			11,592			9,114			8			9,165
Gain on branch sale		—			—		—			(19,983	)		—			—			—
Acquisition-related expenses		276			—		—			—			—			276			—
Non-core expenses^1,2,3		633			—		—			762			—			633			3,481
Tax on adjustments		(220	)		—		(2	)		1,851			(2,220	)		(222	)		(3,081	)
Adjusted Net Income Available to Common Stockholders - Non-GAAP	$	56,986		$	56,364	$	54,875		$	58,102		$	55,613		$	168,225		$	145,212

Average Diluted Common Shares Outstanding (in thousands)		57,448			57,773		58,242			58,247			58,289			57,817			58,629

Diluted Earnings Per Common Share - GAAP	$	0.98		$	0.98	$	0.94		$	1.10		$	0.84		$	2.90		$	2.31
Adjustments:
Net realized losses on sales of available for sale securities		—			—		—			0.20			0.15			—			0.16
Gain on branch sale		—			—		—			(0.34	)		—			—			—
Acquisition-related expenses		—			—		—			—			—			—			—
Non-core expenses^1,2,3		0.01			—		—			0.01			—			0.01			0.06
Tax on adjustments		—			—		—			0.03			(0.04	)		—			(0.05	)
Adjusted Diluted Earnings Per Common Share - Non-GAAP	$	0.99		$	0.98	$	0.94		$	1.00		$	0.95		$	2.91		$	2.48

¹ - Non-core expenses in the Three and Nine Months Ended September 30, 2025 included $0.6 million of severance costs.

² - Non-core expenses in the Three Months Ended December 31, 2024 included $0.8 million of costs directly related to the branch sale.

³ - Non-core expenses in the Nine Months Ended September 30, 2024 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)
	Three Months Ended															Nine Months Ended
	September 30,			June 30,			March 31,			December 31,			September 30,			September 30,			September 30,
		2025			2025			2025			2024			2024			2025			2024
Net Interest Income (GAAP)	$	133,665		$	133,014		$	130,270		$	134,370		$	131,110		$	396,949		$	386,744
Fully Taxable Equivalent ("FTE") Adjustment		6,209			6,199			6,127			5,788			5,883			18,535			17,538
Net Interest Income (FTE) (non-GAAP)	$	139,874		$	139,213		$	136,397		$	140,158		$	136,993		$	415,484		$	404,282

Average Earning Assets (GAAP)	$	17,282,901		$	17,158,984		$	16,960,475		$	17,089,198		$	16,990,358		$	17,135,301		$	17,042,540
Net Interest Margin (GAAP)		3.09	%		3.10	%		3.07	%		3.15	%		3.09	%		3.09	%		3.03	%
FTE Adjustment		0.15	%		0.15	%		0.15	%		0.13	%		0.14	%		0.14	%		0.13	%
Net Interest Margin (FTE) (non-GAAP)		3.24	%		3.25	%		3.22	%		3.28	%		3.23	%		3.23	%		3.16	%


RETURN ON TANGIBLE COMMON EQUITY - NON-GAAP
(Dollars In Thousands)	Three Months Ended															Nine Months Ended
	September 30,			June 30,			March 31,			December 31,			September 30,			September 30,			September 30,
		2025			2025			2025			2024			2024			2025			2024
Total Average Stockholders' Equity (GAAP)	$	2,367,971		$	2,340,010		$	2,340,874		$	2,312,270		$	2,251,547		$	2,349,718		$	2,232,419
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		(724,619	)		(725,813	)		(726,917	)		(728,218	)		(729,581	)		(725,775	)		(730,993	)
Average Tangible Common Equity, Net of Tax (Non-GAAP)	$	1,618,227		$	1,589,072		$	1,588,832		$	1,558,927		$	1,496,841		$	1,598,818		$	1,476,301

Net Income Available to Common Stockholders (GAAP)	$	56,297		$	56,363		$	54,870		$	63,880		$	48,719		$	167,530		$	135,647
Plus: Intangible Asset Amortization, Net of Tax		1,185			1,188			1,206			1,399			1,399			3,579			4,345
Tangible Net Income (Non-GAAP)	$	57,482		$	57,551		$	56,076		$	65,279		$	50,118		$	171,109		$	139,992

Return on Tangible Common Equity (Non-GAAP)		14.21	%		14.49	%		14.12	%		16.75	%		13.39	%		14.27	%		12.64	%

EFFICIENCY RATIO - NON-GAAP
(Dollars In Thousands)	Three Months Ended															Nine Months Ended
	September 30,			June 30,			March 31,			December 31,			September 30,			September 30,			September 30,
		2025			2025			2025			2024			2024			2025			2024
Noninterest Expense (GAAP)	$	96,561		$	93,598		$	92,902		$	96,289		$	94,629		$	283,061		$	282,977
Less: Intangible Asset Amortization		(1,499	)		(1,505	)		(1,526	)		(1,771	)		(1,772	)		(4,530	)		(5,500	)
Less: OREO and Foreclosure Expenses		(121	)		(29	)		(600	)		(227	)		(942	)		(750	)		(1,849	)
Adjusted Noninterest Expense (Non-GAAP)	$	94,941		$	92,064		$	90,776		$	94,291		$	91,915		$	277,781		$	275,628

Net Interest Income (GAAP)	$	133,665		$	133,014		$	130,270		$	134,370		$	131,110		$	396,949		$	386,744
Plus: Fully Taxable Equivalent Adjustment		6,209			6,199			6,127			5,788			5,883			18,535			17,538
Net Interest Income on a Fully Taxable Equivalent Basis (Non-GAAP)	$	139,874		$	139,213		$	136,397		$	140,158		$	136,993		$	415,484		$	404,282

Noninterest Income (GAAP)	$	32,477		$	31,303		$	30,048		$	42,742		$	24,866		$	93,828		$	82,838
Less: Investment Securities (Gains) Losses		—			1			7			11,592			9,114			8			9,165
Adjusted Noninterest Income (Non-GAAP)	$	32,477		$	31,304		$	30,055		$	54,334		$	33,980		$	93,836		$	92,003
Adjusted Revenue (Non-GAAP)	$	172,351		$	170,517		$	166,452		$	194,492		$	170,973		$	509,320		$	496,285
Efficiency Ratio (Non-GAAP)		55.09	%		53.99	%		54.54	%		48.48	%		53.76	%		54.54	%		55.54	%

Adjusted Noninterest Expense (Non-GAAP)	$	94,941		$	92,064		$	90,776		$	94,291		$	91,915		$	277,781		$	275,628
Less: Acquisition-related Expenses		(276	)		—			—			—			—			(276	)		—
Less: Non-core Expenses^1,2,3		(633	)		—			—			(762	)		—			(633	)		(3,481	)
Adjusted Noninterest Expense Excluding Non-core Expenses (Non-GAAP)	$	94,032		$	92,064		$	90,776		$	93,529		$	91,915		$	276,872		$	272,147

Adjusted Revenue (Non-GAAP)	$	172,351		$	170,517		$	166,452		$	194,492		$	170,973		$	509,320		$	496,285
Less: Gain on Branch Sale		—			—			—			(19,983	)		—			—			—
Adjusted Revenue Excluding Gain on Branch Sale (Non-GAAP)	$	172,351		$	170,517		$	166,452		$	174,509		$	170,973		$	509,320		$	496,285
Adjusted Efficiency Ratio (Non-GAAP)		54.56	%		53.99	%		54.54	%		53.60	%		53.76	%		54.36	%		54.84	%

For more information, contact:

Nicole M. Weaver, First Vice President and Director of Corporate Administration

765-521-7619

http://www.firstmerchants.com

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Date	Price Target	Rating	Analyst
9/26/2025		Outperform → Mkt Perform	Raymond James
1/31/2025	$50.00	Market Perform → Outperform	Hovde Group
8/12/2024	$35.00 → $38.00	Market Perform	Hovde Group
8/7/2024	$45.00 → $38.00	Overweight → Equal-Weight	Stephens
2/21/2023	$50.00	Strong Buy → Outperform	Raymond James
7/7/2022		Outperform → Strong Buy	Raymond James
12/13/2021	$47.00	Market Perform → Outperform	Hovde Group
7/29/2021	$48.00	Neutral → Buy	Janney

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