MUNCIE, Ind., Jan. 26, 2026 (GLOBE NEWSWIRE) -- First Merchants Corporation (NASDAQ - FRME) (the "Corporation")

Achieved record full ‑ year results, including net income available to common stockholders of $224.1 million and diluted EPS of $3.88 for 2025.

Fourth Quarter 2025 Highlights:

  • Net income available to common stockholders was $56.6 million and diluted earnings per common share totaled $0.99, compared to $56.3 million and $0.98 in the third quarter of 2025, and $63.9 million and $1.10 in the fourth quarter of 2024. Adjusted net income available to common stockholders 1 was $56.4 million and adjusted diluted earnings per common share 1 totaled $0.98, compared to $57.0 million and $0.99 in the third quarter of 2025, and $58.1 million and $1.00 per common share for the fourth quarter of 2024.
  • Robust capital position with Common Equity Tier 1 Capital Ratio of 11.70% and Tangible Common Equity to Tangible Assets Ratio of 9.38%.
  • Repurchased 1,211,224 shares totaling $46.9 million year-to-date; repurchased 271,953 shares totaling $10.4 million during the fourth quarter.
  • Total loans grew $197.4 million, or 5.8% annualized, on a linked quarter basis, and $938.8 million, or 7.3%, during the last twelve months.
  • Total deposits increased $424.9 million, or 11.4% annualized, on a linked quarter basis, and $773.2 million, or 5.3%, during the last twelve months.
  • Nonperforming assets to total assets were 38 basis points compared to 36 basis points on a linked quarter basis and 43 basis points as of the fourth quarter of 2024.
  • The efficiency ratio totaled 54.52% for the quarter.
  • Received regulatory approval of the acquisition of First Savings Financial Group, Inc. adding approximately $2.4 billion in assets and expanding the Corporation's presence into Southern Indiana and the Louisville MSA. Closing is expected on February 1, 2026.

"First Merchants delivered record double-digit earnings and high single-digit loan growth in 2025. Our capital, liquidity and credit positions remain very strong and position us for continued success," said Mark Hardwick, Chief Executive Officer. "The pending completion of the First Savings Bank acquisition on February 1st will further enhance our state-wide Indiana presence. We value the continued trust of our clients, teammates and shareholders."

Fourth Quarter Financial Results:

First Merchants Corporation (the “Corporation”) reported fourth quarter 2025 net income available to common stockholders of $56.6 million compared to $63.9 million during the same period in 2024. Diluted earnings per common share for the period totaled $0.99 compared to $1.10 in the fourth quarter of 2024. During the fourth quarter of 2024, the Corporation completed the sale of five Illinois branches, including $7.4 million of loans and $267.4 million of deposits, generating a $20.0 million gain recorded in noninterest income. Excluding non-core income and expenses incurred in each period, adjusted earnings per common share 1 for the fourth quarter 2025 totaled $0.98 compared to $1.00 in the prior year period.

Total assets of the Corporation equaled $19.0 billion as of quarter-end and loans totaled $13.8 billion.   During the past twelve months, total loans grew by $938.8 million, or 7.3%. On a linked quarter basis, loans grew $197.4 million, or 5.8% annualized.

Investments, totaling $3.4 billion, decreased $82.1 million, or 2.4%, during the last twelve months and were flat on a linked quarter basis. Investments declined during the quarter due to principal paydowns and maturities; however, the decline was offset by an increase in the securities portfolio valuation.

Total deposits equaled $15.3 billion as of quarter-end and increased by $773.2 million, or 5.3%, over the past twelve months. On a linked quarter basis, deposits increased $424.9 million, or 11.4% annualized.   The loan to deposit ratio decreased to 90.3% at period end from 91.6% in the prior quarter.

The Corporation’s Allowance for Credit Losses – Loans (ACL) totaled $195.6 million as of quarter-end, or 1.42% of total loans, an increase of $1.1 million from prior quarter. Net charge-offs totaled $6.0 million and provision for credit losses of $7.2 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 0.38% for the fourth quarter of 2025, compared to 0.36% in the prior quarter, reflecting stable credit performance.

Net interest income, totaling $139.1 million for the quarter, increased $5.4 million, or 4.0%, compared to prior quarter and increased $4.7 million, or 3.5%, compared to the fourth quarter of 2024. Positively impacting net interest income was an interest recovery of $3.3 million recorded during the current quarter from the successful resolution of a nonaccrual commercial real estate loan. Fully tax equivalent net interest margin was 3.29%, an increase of five basis points compared to prior quarter, and an increase of one basis point compared to the fourth quarter of 2024.

Noninterest income totaled $33.1 million for the quarter, an increase of $0.6 million compared to the third quarter of 2025 and a decrease of $9.6 million from the fourth quarter of 2024. The linked quarter increase was driven by higher customer-related fees including wealth management and card payment fees, as well as higher gains on the sales of mortgage loans. The decrease from the fourth quarter of prior year was driven by a gain on the sale of five Illinois branches to Old Second National Bank on December 6, 2024. Customer-related fees increased $0.7 million over the fourth quarter of prior year.

Noninterest expense totaled $99.5 million for the quarter, an increase of $3.0 million from the third quarter of 2025 and an increase of $3.2 million from the fourth quarter of 2024. The linked quarter increase was from higher health insurance, software and credit costs. Additionally, $0.5 million of acquisition-related costs were recorded in the current quarter. Offsetting these increases was a $0.7 million reduction of an FDIC special assessment accrual that was originally recorded in the first quarter of 2024 following the bank failures of 2023. The increase from the fourth quarter of 2024 was due to higher salaries, employee benefits and data processing costs offset by the reduction of the FDIC special assessment accrual.

The Corporation’s total risk-based capital ratio equaled 13.41%, common equity tier 1 capital ratio equaled 11.70%, and the tangible common equity ratio totaled 9.38%. These ratios continue to reflect the Corporation’s strong capital position.

1 See “Non-GAAP Financial Information” for reconciliation

CONFERENCE CALL

First Merchants Corporation will conduct a fourth quarter earnings conference call and webcast at 9:00 a.m. (ET) on Tuesday, January 27, 2026.

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/BI2b60181d46504632aa732ea584590460)

To view the webcast and presentation slides, please go to (https://edge.media-server.com/mmc/p/o68enev5) during the time of the call. A replay of the webcast will be available until January 27, 2027.

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 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.

Non-GAAP Financial Measures

This news release contains non-GAAP financial measures. For purposes of Regulation G, a non-GAAP financial measure is a numerical measure of the registrant’s historical or future financial performance, financial position or cash flows that excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of income, balance sheet or statement of cash flows (or equivalent statements) of the issuer; or includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented. In this regard, GAAP refers to generally accepted accounting principles in the United States. Pursuant to the requirements of Regulation G, First Merchants Corporation has provided reconciliations within this news release, as necessary, of the non-GAAP financial measure to the most directly comparable GAAP financial measure.

CONSOLIDATED BALANCE SHEETS (Unaudited)
(Dollars In Thousands, Except Per Share Amounts) December 31,
2025 2024
ASSETS
Cash and due from banks $ 84,158 $ 87,616
Interest-bearing deposits 196,300 298,891
Investment securities available for sale 1,407,102 1,386,475
Investment securities held to maturity, net of allowance for credit losses 1,971,539 2,074,220
Loans held for sale 20,079 18,663
Loans 13,791,707 12,854,359
Less: Allowance for credit losses - loans (195,597 ) (192,757 )
Net loans 13,596,110 12,661,602
Premises and equipment 121,058 129,743
Federal Home Loan Bank stock 47,245 41,690
Interest receivable 93,374 91,829
Goodwill 712,002 712,002
Other intangibles 13,800 19,828
Cash surrender value of life insurance 308,438 304,906
Other real estate owned 658 4,948
Tax asset, deferred and receivable 78,664 92,387
Other assets 374,574 387,169
TOTAL ASSETS $ 19,025,101 $ 18,311,969
LIABILITIES
Deposits:
Noninterest-bearing $ 2,137,262 $ 2,325,579
Interest-bearing 13,157,593 12,196,047
Total Deposits 15,294,855 14,521,626
Borrowings:
Federal funds purchased 40,000 99,226
Securities sold under repurchase agreements 103,755 142,876
Federal Home Loan Bank advances 798,549 822,554
Subordinated debentures and other borrowings 57,630 93,529
Total Borrowings 999,934 1,158,185
Interest payable 18,235 16,102
Other liabilities 245,410 311,073
Total Liabilities 16,558,434 16,006,986
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 - 56,951,939 and 57,974,535 shares 7,119 7,247
Additional paid-in capital 1,150,816 1,188,768
Retained earnings 1,413,742 1,272,528
Accumulated other comprehensive loss (130,135 ) (188,685 )
Total Stockholders' Equity 2,466,667 2,304,983
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 19,025,101 $ 18,311,969


CONSOLIDATED STATEMENTS OF INCOME (Unaudited) Three Months Ended Twelve Months Ended
(Dollars In Thousands, Except Per Share Amounts) December 31, December 31,
2025 2024 2025 2024
INTEREST INCOME
Loans:
Taxable $ 203,120 $ 197,536 $ 786,427 $ 803,652
Tax-exempt 10,905 9,020 43,415 34,262
Investment securities:
Taxable 7,736 9,024 32,662 36,086
Tax-exempt 12,459 12,754 49,952 53,487
Deposits with financial institutions 2,187 5,350 8,127 16,992
Federal Home Loan Bank stock 1,037 958 4,209 3,527
Total Interest Income 237,444 234,642 924,792 948,006
INTEREST EXPENSE
Deposits 88,670 89,835 344,279 386,127
Federal funds purchased 218 26 2,219 481
Securities sold under repurchase agreements 405 680 2,464 3,057
Federal Home Loan Bank advances 8,047 8,171 35,763 29,886
Subordinated debentures and other borrowings 1,040 1,560 4,054 7,341
Total Interest Expense 98,380 100,272 388,779 426,892
NET INTEREST INCOME 139,064 134,370 536,013 521,114
Provision for credit losses 7,150 4,200 21,250 35,700
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES 131,914 130,170 514,763 485,414
NONINTEREST INCOME
Service charges on deposit accounts 8,704 8,124 34,263 32,606
Fiduciary and wealth management fees 9,175 8,665 35,492 34,215
Card payment fees 5,325 4,957 19,790 19,317
Net gains and fees on sales of loans 5,421 5,681 21,275 20,840
Derivative hedge fees 1,053 1,594 3,385 3,082
Other customer fees 315 316 1,545 1,547
Earnings on bank-owned life insurance 1,854 2,188 7,613 8,464
Net realized losses on sales of available for sale securities — (11,592 ) (8 ) (20,757 )
Gain on branch sale — 19,983 — 19,983
Other income 1,259 2,826 3,579 6,283
Total Noninterest Income 33,106 42,742 126,934 125,580
NONINTEREST EXPENSE
Salaries and employee benefits 58,254 55,437 225,080 221,167
Net occupancy 7,283 7,335 28,401 28,387
Equipment 7,681 7,028 28,614 26,802
Marketing 2,324 2,582 7,794 7,389
Outside data processing fees 7,509 6,029 27,488 27,140
Printing and office supplies 450 377 1,380 1,462
Intangible asset amortization 1,498 1,771 6,028 7,271
FDIC assessments 2,684 3,744 13,410 15,029
Other real estate owned and foreclosure expenses 775 227 1,525 2,076
Professional and other outside services 3,774 3,777 14,494 14,586
Other expenses 7,290 7,982 28,369 27,957
Total Noninterest Expense 99,522 96,289 382,583 379,266
Income Before Income Taxes 65,498 76,623 259,114 231,728
Income tax expense 8,433 12,274 33,113 30,326
NET INCOME 57,065 64,349 226,001 201,402
Preferred stock dividends 469 469 1,875 1,875
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS $ 56,596 $ 63,880 $ 224,126 $ 199,527
PER SHARE DATA:
Basic Net Income Available to Common Stockholders $ 0.99 $ 1.10 $ 3.90 $ 3.42
Diluted Net Income Available to Common Stockholders $ 0.99 $ 1.10 $ 3.88 $ 3.41
Cash Dividends Paid to Common Stockholders $ 0.36 $ 0.35 $ 1.43 $ 1.39
Tangible Common Book Value Per Share $ 30.18 $ 26.78 $ 30.18 $ 26.78
Average Diluted Common Shares Outstanding (in thousands) 57,442 58,247 57,726 58,533


FINANCIAL HIGHLIGHTS
(Dollars In Thousands) Three Months Ended Twelve Months Ended
December 31, December 31,
2025 2024 2025 2024
NET CHARGE-OFFS $ 6,021 $ 771 $ 18,410 $ 49,377
AVERAGE BALANCES:
Total Assets $ 19,039,989 $ 18,478,303 $ 18,633,952 $ 18,400,495
Total Loans 13,717,822 12,757,676 13,320,678 12,634,324
Total Earning Assets 17,648,233 17,089,198 17,264,588 17,054,267
Total Deposits 15,294,518 14,788,294 14,816,114 14,816,564
Total Stockholders' Equity 2,452,005 2,312,270 2,375,500 2,252,491
FINANCIAL RATIOS:
Return on Average Assets 1.20 % 1.39 % 1.21 % 1.09 %
Return on Average Stockholders' Equity 9.23 11.05 9.43 8.86
Return on Tangible Common Stockholders' Equity 13.57 16.75 14.08 13.71
Average Earning Assets to Average Assets 92.69 92.48 92.65 92.68
Allowance for Credit Losses - Loans as % of Total Loans 1.42 1.50 1.42 1.50
Net Charge-offs as % of Average Loans (Annualized) 0.18 0.02 0.14 0.39
Average Stockholders' Equity to Average Assets 12.88 12.51 12.75 12.24
Fully Taxable Equivalent (FTE) Yield on Average Earning Assets 5.52 5.63 5.50 5.69
Interest Expense/Average Earning Assets 2.23 2.35 2.25 2.50
Net Interest Margin FTE 3.29 3.28 3.25 3.19
Efficiency Ratio 54.52 48.48 54.54 53.55


ASSET QUALITY
(Dollars In Thousands) December 31, September 30, June 30, March 31, December 31,
2025 2025 2025 2025 2024
Nonaccrual Loans $ 71,773 $ 65,740 $ 67,358 $ 81,922 $ 73,773
Other Real Estate Owned and Repossessions 658 1,270 177 4,966 4,948
Nonperforming Assets (NPA) 72,431 67,010 67,535 86,888 78,721
90+ Days Delinquent 2,042 1,925 4,443 4,280 5,902
NPAs & 90+ Days Delinquent $ 74,473 $ 68,935 $ 71,978 $ 91,168 $ 84,623
Allowance for Credit Losses - Loans $ 195,597 $ 194,468 $ 195,316 $ 192,031 $ 192,757
Quarterly Net Charge-offs 6,021 5,148 2,315 4,926 771
NPAs / Actual Assets % 0.38 % 0.36 % 0.36 % 0.47 % 0.43 %
NPAs & 90 Day / Actual Assets % 0.39 % 0.37 % 0.39 % 0.49 % 0.46 %
NPAs / Actual Loans and OREO % 0.52 % 0.49 % 0.51 % 0.67 % 0.61 %
Allowance for Credit Losses - Loans / Actual Loans (%) 1.42 % 1.43 % 1.47 % 1.47 % 1.50 %
Quarterly Net Charge-offs as % of Average Loans (Annualized) 0.18 % 0.15 % 0.07 % 0.15 % 0.02 %


CONSOLIDATED BALANCE SHEETS (Unaudited)
(Dollars In Thousands, Except Per Share Amounts) December 31, September 30, June 30, March 31, December 31,
2025 2025 2025 2025 2024
ASSETS
Cash and due from banks $ 84,158 $ 88,079 $ 81,567 $ 86,113 $ 87,616
Interest-bearing deposits 196,300 168,706 223,343 331,534 298,891
Investment securities available for sale 1,407,102 1,386,903 1,358,130 1,378,489 1,386,475
Investment securities held to maturity, net of allowance for credit losses 1,971,539 1,995,488 2,022,826 2,048,632 2,074,220
Loans held for sale 20,079 23,190 28,783 23,004 18,663
Loans 13,791,707 13,591,174 13,296,759 13,004,905 12,854,359
Less: Allowance for credit losses - loans (195,597 ) (194,468 ) (195,316 ) (192,031 ) (192,757 )
Net loans 13,596,110 13,396,706 13,101,443 12,812,874 12,661,602
Premises and equipment 121,058 121,771 122,808 128,749 129,743
Federal Home Loan Bank stock 47,245 47,264 47,290 45,006 41,690
Interest receivable 93,374 89,102 93,258 88,352 91,829
Goodwill 712,002 712,002 712,002 712,002 712,002
Other intangibles 13,800 15,298 16,797 18,302 19,828
Cash surrender value of life insurance 308,438 306,583 305,695 304,918 304,906
Other real estate owned 658 1,270 177 4,966 4,948
Tax asset, deferred and receivable 78,664 89,758 97,749 87,665 92,387
Other assets 374,574 369,509 380,909 369,181 387,169
TOTAL ASSETS $ 19,025,101 $ 18,811,629 $ 18,592,777 $ 18,439,787 $ 18,311,969
LIABILITIES
Deposits:
Noninterest-bearing $ 2,137,262 $ 2,100,570 $ 2,197,416 $ 2,185,057 $ 2,325,579
Interest-bearing 13,157,593 12,769,409 12,600,162 12,276,921 12,196,047
Total Deposits 15,294,855 14,869,979 14,797,578 14,461,978 14,521,626
Borrowings:
Federal funds purchased 40,000 199,370 85,000 185,000 99,226
Securities sold under repurchase agreements 103,755 122,226 114,758 122,947 142,876
Federal Home Loan Bank advances 798,549 798,626 898,702 972,478 822,554
Subordinated debentures and other borrowings 57,630 57,632 62,617 62,619 93,529
Total Borrowings 999,934 1,177,854 1,161,077 1,343,044 1,158,185
Interest payable 18,235 18,240 16,174 13,304 16,102
Other liabilities 245,410 333,154 269,996 289,247 311,073
Total Liabilities 16,558,434 16,399,227 16,244,825 16,107,573 16,006,986
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 7,119 7,149 7,159 7,226 7,247
Additional paid-in capital 1,150,816 1,158,026 1,163,170 1,183,263 1,188,768
Retained earnings 1,413,742 1,377,966 1,342,473 1,306,911 1,272,528
Accumulated other comprehensive loss (130,135 ) (155,864 ) (189,975 ) (190,311 ) (188,685 )
Total Stockholders' Equity 2,466,667 2,412,402 2,347,952 2,332,214 2,304,983
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 19,025,101 $ 18,811,629 $ 18,592,777 $ 18,439,787 $ 18,311,969


CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(Dollars In Thousands, Except Per Share Amounts) December 31, September 30, June 30, March 31, December 31,
2025 2025 2025 2025 2024
INTEREST INCOME
Loans:
Taxable $ 203,120 $ 200,406 $ 195,173 $ 187,728 $ 197,536
Tax-exempt 10,905 11,173 10,805 10,532 9,020
Investment securities:
Taxable 7,736 8,288 8,266 8,372 9,024
Tax-exempt 12,459 12,460 12,516 12,517 12,754
Deposits with financial institutions 2,187 1,676 1,892 2,372 5,350
Federal Home Loan Bank stock 1,037 1,092 1,083 997 958
Total Interest Income 237,444 235,095 229,735 222,518 234,642
INTEREST EXPENSE
Deposits 88,670 90,821 84,241 80,547 89,835
Federal funds purchased 218 224 965 812 26
Securities sold under repurchase agreements 405 654 663 742 680
Federal Home Loan Bank advances 8,047 8,638 9,714 9,364 8,171
Subordinated debentures and other borrowings 1,040 1,093 1,138 783 1,560
Total Interest Expense 98,380 101,430 96,721 92,248 100,272
NET INTEREST INCOME 139,064 133,665 133,014 130,270 134,370
Provision for credit losses 7,150 4,300 5,600 4,200 4,200
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES 131,914 129,365 127,414 126,070 130,170
NONINTEREST INCOME
Service charges on deposit accounts 8,704 8,921 8,566 8,072 8,124
Fiduciary and wealth management fees 9,175 8,842 8,831 8,644 8,665
Card payment fees 5,325 5,007 4,932 4,526 4,957
Net gains and fees on sales of loans 5,421 4,983 5,849 5,022 5,681
Derivative hedge fees 1,053 1,097 831 404 1,594
Other customer fees 315 414 401 415 316
Earnings on bank-owned life insurance 1,854 1,667 1,913 2,179 2,188
Net realized losses on sales of available for sale securities — — (1 ) (7 ) (11,592 )
Gain on branch sale — — — — 19,983
Other income (loss) 1,259 1,546 (19 ) 793 2,826
Total Noninterest Income 33,106 32,477 31,303 30,048 42,742
NONINTEREST EXPENSE
Salaries and employee benefits 58,254 57,317 54,527 54,982 55,437
Net occupancy 7,283 7,057 6,845 7,216 7,335
Equipment 7,681 6,998 6,927 7,008 7,028
Marketing 2,324 2,120 1,997 1,353 2,582
Outside data processing fees 7,509 6,943 7,107 5,929 6,029
Printing and office supplies 450 311 272 347 377
Intangible asset amortization 1,498 1,499 1,505 1,526 1,771
FDIC assessments 2,684 3,526 3,552 3,648 3,744
Other real estate owned and foreclosure expenses 775 121 29 600 227
Professional and other outside services 3,774 3,718 3,741 3,261 3,777
Other expenses 7,290 6,951 7,096 7,032 7,982
Total Noninterest Expense 99,522 96,561 93,598 92,902 96,289
Income Before Income Taxes 65,498 65,281 65,119 63,216 76,623
Income tax expense 8,433 8,516 8,287 7,877 12,274
NET INCOME 57,065 56,765 56,832 55,339 64,349
Preferred stock dividends 469 468 469 469 469
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS $ 56,596 $ 56,297 $ 56,363 $ 54,870 $ 63,880
PER SHARE DATA:
Basic Net Income Available to Common Stockholders $ 0.99 $ 0.98 $ 0.98 $ 0.95 $ 1.10
Diluted Net Income Available to Common Stockholders $ 0.99 $ 0.98 $ 0.98 $ 0.94 $ 1.10
Cash Dividends Paid to Common Stockholders $ 0.36 $ 0.36 $ 0.36 $ 0.35 $ 0.35
Tangible Common Book Value Per Share $ 30.18 $ 29.08 $ 27.90 $ 27.34 $ 26.78
Average Diluted Common Shares Outstanding (in thousands) 57,442 57,448 57,773 58,242 58,247
FINANCIAL RATIOS:
Return on Average Assets 1.20 % 1.22 % 1.23 % 1.21 % 1.39 %
Return on Average Stockholders' Equity 9.23 9.51 9.63 9.38 11.05
Return on Tangible Common Stockholders' Equity 13.57 14.21 14.49 14.12 16.75
Average Earning Assets to Average Assets 92.69 92.73 92.71 92.47 92.48
Allowance for Credit Losses - Loans as % of Total Loans 1.42 1.43 1.47 1.47 1.50
Net Charge-offs as % of Average Loans (Annualized) 0.18 0.15 0.07 0.15 0.02
Average Stockholders' Equity to Average Assets 12.88 12.71 12.64 12.76 12.51
Fully Taxable Equivalent (FTE) Yield on Average Earning Assets 5.52 5.58 5.50 5.39 5.63
Interest Expense/Average Earning Assets 2.23 2.34 2.25 2.17 2.35
Net Interest Margin FTE 3.29 3.24 3.25 3.22 3.28
Efficiency Ratio 54.52 55.09 53.99 54.54 48.48


LOANS
(Dollars In Thousands) December 31, September 30, June 30, March 31, December 31,
2025 2025 2025 2025 2024
Commercial and industrial loans $ 4,478,282 $ 4,604,895 $ 4,440,924 $ 4,306,597 $ 4,114,292
Agricultural land, production and other loans to farmers 283,125 275,817 265,172 243,864 256,312
Real estate loans:
Construction 804,775 789,021 836,033 793,175 792,144
Commercial real estate, non-owner occupied 2,338,666 2,304,889 2,171,092 2,177,869 2,274,016
Commercial real estate, owner occupied 1,237,100 1,232,117 1,226,797 1,214,739 1,157,944
Residential 2,420,310 2,412,783 2,397,094 2,389,852 2,374,729
Home equity 710,980 687,021 673,961 650,499 659,811
Individuals' loans for household and other personal expenditures 155,436 138,703 141,045 140,954 166,028
Public finance and other commercial loans 1,363,033 1,145,928 1,144,641 1,087,356 1,059,083
Loans 13,791,707 13,591,174 13,296,759 13,004,905 12,854,359
Allowance for credit losses - loans (195,597 ) (194,468 ) (195,316 ) (192,031 ) (192,757 )
NET LOANS $ 13,596,110 $ 13,396,706 $ 13,101,443 $ 12,812,874 $ 12,661,602


DEPOSITS
(Dollars In Thousands) December 31, September 30, June 30, March 31, December 31,
2025 2025 2025 2025 2024
Demand deposits $ 7,770,473 $ 7,645,698 $ 7,798,695 $ 7,786,554 $ 7,980,061
Savings deposits 5,481,785 5,164,707 4,984,659 4,791,874 4,522,758
Certificates and other time deposits of $100,000 or less 603,690 627,828 617,857 625,203 692,068
Certificates and other time deposits of $100,000 or more 915,293 910,337 891,139 896,143 1,043,068
Brokered certificates of deposits (1) 523,614 521,409 505,228 362,204 283,671
TOTAL DEPOSITS $ 15,294,855 $ 14,869,979 $ 14,797,578 $ 14,461,978 $ 14,521,626

( 1) Total brokered deposits of $1.5 billion, which includes brokered CD's of $523.6 million at December 31, 2025.

CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST MARGIN ANALYSIS
(Dollars In Thousands)
Three Months Ended
December 31, 2025 December 31, 2024
Average Balance Interest
Income /
Expense 		Average
Rate 		Average Balance Interest
Income /
Expense 		Average
Rate
ASSETS
Interest-bearing deposits $ 313,018 $ 2,187 2.79 % $ 522,868 $ 5,350 4.09 %
Federal Home Loan Bank stock 47,251 1,037 8.78 41,703 958 9.19
Investment Securities: (1)
Taxable 1,535,025 7,736 2.02 1,677,554 9,024 2.15
Tax-exempt (2) 2,035,117 15,771 3.10 2,089,397 16,144 3.09
Total Investment Securities 3,570,142 23,507 2.63 3,766,951 25,168 2.67
Loans held for sale 32,272 494 6.12 36,219 550 6.07
Loans: (3)
Commercial 9,417,302 160,949 6.84 8,753,723 156,414 7.15
Real estate mortgage 2,236,769 26,019 4.65 2,177,351 24,401 4.48
HELOC and installment 870,199 15,658 7.20 841,537 16,171 7.69
Tax-exempt (2) 1,161,280 13,778 4.75 948,846 11,418 4.81
Total Loans 13,717,822 216,898 6.32 12,757,676 208,954 6.55
Total Earning Assets 17,648,233 243,629 5.52 % 17,089,198 240,430 5.63 %
Total Non-Earning Assets 1,391,756 1,389,105
TOTAL ASSETS $ 19,039,989 $ 18,478,303
LIABILITIES
Interest-Bearing Deposits:
Interest-bearing deposits $ 5,652,753 $ 34,573 2.45 % $ 5,564,228 $ 37,049 2.66 %
Money market deposits 4,144,256 31,813 3.07 3,189,334 25,463 3.19
Savings deposits 1,261,173 2,399 0.76 1,362,705 3,102 0.91
Certificates and other time deposits 2,077,545 19,885 3.83 2,313,284 24,221 4.19
Total Interest-Bearing Deposits 13,135,727 88,670 2.70 12,429,551 89,835 2.89
Borrowings 973,364 9,710 3.99 1,049,677 10,437 3.98
Total Interest-Bearing Liabilities 14,109,091 98,380 2.79 13,479,228 100,272 2.98
Noninterest-bearing deposits 2,158,791 2,358,743
Other liabilities 320,102 328,062
Total Liabilities 16,587,984 16,166,033
STOCKHOLDERS' EQUITY 2,452,005 2,312,270
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 19,039,989 $ 18,478,303
Net Interest Income (FTE) $ 145,249 $ 140,158
Net Interest Spread (FTE) (4) 2.73 % 2.65 %
Net Interest Margin (FTE):
Interest Income (FTE) / Average Earning Assets 5.52 % 5.63 %
Interest Expense / Average Earning Assets 2.23 % 2.35 %
Net Interest Margin (FTE) (5) 3.29 % 3.28 %
(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 $6.2 million and $5.8 million for the three months ended December 31, 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)
Twelve Months Ended
December 31, 2025 December 31, 2024
Average Balance Interest
Income /
Expense 		Average
Rate 		Average Balance Interest
Income /
Expense 		Average
Rate
ASSETS
Interest-bearing deposits $ 272,164 $ 8,127 2.99 % $ 418,163 $ 16,992 4.06 %
Federal Home Loan Bank stock 46,289 4,209 9.09 41,736 3,527 8.45
Investment Securities: (1)
Taxable 1,585,375 32,662 2.06 1,759,578 36,086 2.05
Tax-exempt (2) 2,040,082 63,230 3.10 2,200,466 67,705 3.08
Total Investment Securities 3,625,457 95,892 2.64 3,960,044 103,791 2.62
Loans held for sale 26,199 1,603 6.12 29,650 1,792 6.04
Loans: (3)
Commercial 9,091,847 621,298 6.83 8,687,638 641,393 7.38
Real estate mortgage 2,211,726 101,203 4.58 2,158,743 94,890 4.40
HELOC and installment 846,430 62,323 7.36 830,079 65,577 7.90
Tax-exempt (2) 1,144,476 54,857 4.79 928,214 43,370 4.67
Total Loans 13,320,678 841,284 6.32 12,634,324 847,022 6.70
Total Earning Assets 17,264,588 949,512 5.50 % 17,054,267 971,332 5.69 %
Total Non-Earning Assets 1,369,364 1,346,228
TOTAL ASSETS $ 18,633,952 $ 18,400,495
LIABILITIES
Interest-Bearing deposits:
Interest-bearing deposits $ 5,580,592 $ 141,945 2.54 % $ 5,506,492 $ 157,984 2.87 %
Money market deposits 3,762,100 118,188 3.14 3,061,461 106,026 3.46
Savings deposits 1,278,138 9,962 0.78 1,463,707 14,587 1.00
Certificates and other time deposits 2,016,857 74,184 3.68 2,413,900 107,530 4.45
Total Interest-Bearing Deposits 12,637,687 344,279 2.72 12,445,560 386,127 3.10
Borrowings 1,138,760 44,500 3.91 1,005,017 40,765 4.06
Total Interest-Bearing Liabilities 13,776,447 388,779 2.82 13,450,577 426,892 3.17
Noninterest-bearing deposits 2,178,427 2,371,004
Other liabilities 303,578 326,423
Total Liabilities 16,258,452 16,148,004
STOCKHOLDERS' EQUITY 2,375,500 2,252,491
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 18,633,952 $ 18,400,495
Net Interest Income (FTE) $ 560,733 $ 544,440
Net Interest Spread (FTE) (4) 2.68 % 2.52 %
Net Interest Margin (FTE):
Interest Income (FTE) / Average Earning Assets 5.50 % 5.69 %
Interest Expense / Average Earning Assets 2.25 % 2.50 %
Net Interest Margin (FTE) (5) 3.25 % 3.19 %
(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 $24.7 million and $23.3 million for the years ended December 31, 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 Twelve Months Ended
December 31, September 30, June 30, March 31, December 31, December 31, December 31,
2025 2025 2025 2025 2024 2025 2024
Net Income Available to Common Stockholders - GAAP $ 56,596 $ 56,297 $ 56,363 $ 54,870 $ 63,880 $ 224,126 $ 199,527
Adjustments:
Net realized losses on sales of available for sale securities — — 1 7 11,592 8 20,757
Gain on branch sale — — — — (19,983 ) — (19,983 )
Acquisition-related expenses 524 276 — — — 800 —
Non-core expenses (1)(2)(3)(4) (743 ) 633 — — 762 (110 ) 4,243
Tax on adjustments 53 (220 ) — (2 ) 1,851 (169 ) (1,229 )
Adjusted Net Income Available to Common Stockholders - Non-GAAP $ 56,430 $ 56,986 $ 56,364 $ 54,875 $ 58,102 $ 224,655 $ 203,315
Average Diluted Common Shares Outstanding (in thousands) 57,442 57,448 57,773 58,242 58,247 57,726 58,533
Diluted Earnings Per Common Share - GAAP $ 0.99 $ 0.98 $ 0.98 $ 0.94 $ 1.10 $ 3.88 $ 3.41
Adjustments:
Net realized losses on sales of available for sale securities — — — — 0.20 — 0.35
Gain on branch sale — — — — (0.34 ) — (0.34 )
Acquisition-related expenses — — — — — 0.01 —
Non-core expenses (1)(2)(3)(4) (0.01 ) 0.01 — — 0.01 — 0.07
Tax on adjustments — — — — 0.03 — (0.02 )
Adjusted Diluted Earnings Per Common Share - Non-GAAP $ 0.98 $ 0.99 $ 0.98 $ 0.94 $ 1.00 $ 3.89 $ 3.47

(1) Non-core expenses in the Three Months Ended December 31, 2025 included a $0.7 million reduction in the FDIC special assessment
(2) Non-core expenses in the Three Months Ended September 30, 2025 included $0.6 million of severance costs
(3) Non-core expenses in the Three Months Ended December 31, 2024 included $0.8 million of costs directly related to the branch sale
(4) Non-core expenses in the Twelve Months Ended December 31, 2024 included $2.4 million from duplicative online banking conversion costs, $1.1 million from the FDIC special assessment, and $0.8 million of costs directly related to the branch sale

NET INTEREST MARGIN (FTE) - NON-GAAP
(Dollars in Thousands)
Three Months Ended Twelve Months Ended
December 31, September 30, June 30, March 31, December 31, December 31, December 31,
2025 2025 2025 2025 2024 2025 2024
Net Interest Income (GAAP) $ 139,064 $ 133,665 $ 133,014 $ 130,270 $ 134,370 $ 536,013 $ 521,114
Fully Taxable Equivalent ("FTE") Adjustment 6,185 6,209 6,199 6,127 5,788 24,720 23,326
Net Interest Income (FTE) (Non-GAAP) $ 145,249 $ 139,874 $ 139,213 $ 136,397 $ 140,158 $ 560,733 $ 544,440
Average Earning Assets (GAAP) $ 17,648,233 $ 17,282,901 $ 17,158,984 $ 16,960,475 $ 17,089,198 $ 17,264,588 $ 17,054,267
Net Interest Margin (GAAP) 3.15 % 3.09 % 3.10 % 3.07 % 3.15 % 3.10 % 3.06 %
FTE Adjustment 0.14 % 0.15 % 0.15 % 0.15 % 0.13 % 0.15 % 0.13 %
Net Interest Margin (FTE) (Non-GAAP) 3.29 % 3.24 % 3.25 % 3.22 % 3.28 % 3.25 % 3.19 %


RETURN ON TANGIBLE COMMON EQUITY - NON-GAAP
(Dollars In Thousands) Three Months Ended Twelve Months Ended
December 31, September 30, June 30, March 31, December 31, December 31, December 31,
2025 2025 2025 2025 2024 2025 2024
Total Average Stockholders' Equity (GAAP) $ 2,452,005 $ 2,367,971 $ 2,340,010 $ 2,340,874 $ 2,312,270 $ 2,375,500 $ 2,252,491
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 (723,466 ) (724,619 ) (725,813 ) (726,917 ) (728,218 ) (725,193 ) (730,295 )
Average Tangible Common Equity, Net of Tax (Non-GAAP) $ 1,703,414 $ 1,618,227 $ 1,589,072 $ 1,588,832 $ 1,558,927 $ 1,625,182 $ 1,497,071
Net Income Available to Common Stockholders (GAAP) $ 56,596 $ 56,297 $ 56,363 $ 54,870 $ 63,880 $ 224,126 $ 199,527
Plus: Intangible Asset Amortization, Net of Tax 1,183 1,185 1,188 1,206 1,399 4,762 5,744
Tangible Net Income (Non-GAAP) $ 57,779 $ 57,482 $ 57,551 $ 56,076 $ 65,279 $ 228,888 $ 205,271
Return on Tangible Common Equity (Non-GAAP) 13.57 % 14.21 % 14.49 % 14.12 % 16.75 % 14.08 % 13.71 %


EFFICIENCY RATIO - NON-GAAP
(Dollars In Thousands) Three Months Ended Twelve Months Ended
December 31, September 30, June 30, March 31, December 31, December 31, December 31,
2025 2025 2025 2025 2024 2025 2024
Noninterest Expense (GAAP) $ 99,522 $ 96,561 $ 93,598 $ 92,902 $ 96,289 $ 382,583 $ 379,266
Less: Intangible Asset Amortization (1,498 ) (1,499 ) (1,505 ) (1,526 ) (1,771 ) (6,028 ) (7,271 )
Less: OREO and Foreclosure Expenses (775 ) (121 ) (29 ) (600 ) (227 ) (1,525 ) (2,076 )
Adjusted Noninterest Expense (Non-GAAP) $ 97,249 $ 94,941 $ 92,064 $ 90,776 $ 94,291 $ 375,030 $ 369,919
Net Interest Income (GAAP) $ 139,064 $ 133,665 $ 133,014 $ 130,270 $ 134,370 $ 536,013 $ 521,114
Plus: Fully Taxable Equivalent Adjustment 6,185 6,209 6,199 6,127 5,788 24,720 23,326
Net Interest Income on a Fully Taxable Equivalent Basis (Non-GAAP) $ 145,249 $ 139,874 $ 139,213 $ 136,397 $ 140,158 $ 560,733 $ 544,440
Noninterest Income (GAAP) $ 33,106 $ 32,477 $ 31,303 $ 30,048 $ 42,742 $ 126,934 $ 125,580
Less: Investment Securities (Gains) Losses — — 1 7 11,592 8 20,757
Adjusted Noninterest Income (Non-GAAP) $ 33,106 $ 32,477 $ 31,304 $ 30,055 $ 54,334 $ 126,942 $ 146,337
Adjusted Revenue (Non-GAAP) $ 178,355 $ 172,351 $ 170,517 $ 166,452 $ 194,492 $ 687,675 $ 690,777
Efficiency Ratio (Non-GAAP) 54.52 % 55.09 % 53.99 % 54.54 % 48.48 % 54.54 % 53.55 %
Adjusted Noninterest Expense (Non-GAAP) $ 97,249 $ 94,941 $ 92,064 $ 90,776 $ 94,291 $ 375,030 $ 369,919
Less: Acquisition-related Expenses (524 ) (276 ) — — — (800 ) —
Less: Non-core Expenses (1)(2)(3)(4) 743 (633 ) — — (762 ) 110 (4,243 )
Adjusted Noninterest Expense Excluding Non-core Expenses (Non-GAAP) $ 97,468 $ 94,032 $ 92,064 $ 90,776 $ 93,529 $ 374,340 $ 365,676
Adjusted Revenue (Non-GAAP) $ 178,355 $ 172,351 $ 170,517 $ 166,452 $ 194,492 $ 687,675 $ 690,777
Less: Gain on Branch Sale — — — — (19,983 ) — (19,983 )
Adjusted Revenue Excluding Gain on Branch Sale (Non-GAAP) $ 178,355 $ 172,351 $ 170,517 $ 166,452 $ 174,509 $ 687,675 $ 670,794
Adjusted Efficiency Ratio (Non-GAAP) 54.65 % 54.56 % 53.99 % 54.54 % 53.60 % 54.44 % 54.51 %

(1) Non-core expenses in the Three Months Ended December 31, 2025 included a $0.7 million reduction in the FDIC special assessment
(2) Non-core expenses in the Three Months Ended September 30, 2025 included $0.6 million of severance costs
(3) Non-core expenses in the Three Months Ended December 31, 2024 included $0.8 million of costs directly related to the branch sale
(4) Non-core expenses in the Twelve Months Ended December 31, 2024 included $2.4 million from duplicative online banking conversion costs, $1.1 million from the FDIC special assessment, and $0.8 million of costs directly related to the branch sale

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