First Merchants Corporation Announces Fourth Quarter 2025 Earnings Per Share
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 stockholders1 was $56.4 million and adjusted diluted earnings per common share1 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 share1 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
