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 InterestIncome /
Expense Average
Rate Average Balance InterestIncome /
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* *%*