8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) April  21, 2010

MUTUALFIRST FINANCIAL, INC.

(Exact name of registrant as specified in its chapter)

Maryland	000-27905	35-2085640
(State or other jurisdiction of incorporation	(Commission File Number)	(IRS Employer Identification No.)

110 E. Charles Street, Muncie, Indiana	47305-2419
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code (765) 747-2800              

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02.  Results of Operations and Financial Condition

         On April 21, 2010 the Registrant issued a press release announcing earnings for the first quarter ended March 31, 2010. A copy of the press release, including unaudited financial information released as a part thereof, is attached as Exhibit 99 to this Current Report on Form 8-K and incorporated by reference herein.

Item 9.01.  Financial Statements and Exhibits

(d)	Exhibits
	99	Press release dated April 21, 2010.

SIGNATURES

       Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.

	MUTUALFIRST FINANCIAL, INC.
Date: April 21, 2010	By:	/s/ David W. Heeter
		David W. Heeter
		President and Chief Executive Officer

EXHIBIT INDEX

Exhibit Number	Description
99	Press Release, dated April 21, 2010

EX-99

PRESS RELEASE

Date:	April 21, 2010
From:	MutualFirst Financial, Inc.
For Publication:	Immediately
Contact:	Tim McArdle, Senior Vice President and Treasurer of
	MutualFirst Financial, Inc. (765) 747-2818

MutualFirst Announces First Quarter 2010 Earnings

 Muncie, Indiana - MutualFirst Financial, Inc. (NASDAQ: MFSF), the holding company of MutualBank (the “Bank”), announced today that net income available for common shareholders for the first quarter ended March 31, 2010 was $893,000, or $.13 for basic and diluted earnings per common share.  This compared to net income available for common shareholder for the same period in 2009 of $1.3 million, or $.20 for basic and diluted earnings per common share. Annualized return on assets was .37% and return on average tangible common equity was 3.87% for the first quarter of 2010 compared to .51% and 5.86% respectively, for the same period of last year.

Other financial highlights for the first quarter ended March 31, 2010 include:

· Asset growth of $88.1 million was primarily driven by an accumulation of cash and an increase in investment securities as a result of an increase in deposits of $77.2 million and a decrease in loan balances of $30.5 million compared to December 31, 2009.

· Non-performing assets declined $3.8 million during the first quarter of 2010, reducing the non-performing asset ratio from 2.86% at December 31, 2009 to 2.44% as of March 31, 2010.  Non-performing loans declined $5.2 million in the first quarter of 2010 reducing the non-performing loan ratio from 3.03% to 2.62%.

· Net charge offs to average loans for the quarter were .49%, compared to .69% for quarter ended December 31, 2009 and .34% for quarter ended March 31, 2009.

· Allowance for loan losses to non-performing loans increased to 60.77% from 50.38% as of December 31, 2009 and allowance for loan losses to loans receivable increased to 1.59% from1.53% as of December 31, 2009.

· Net interest margin declined to 3.18% as of March 31, 2010 compared to 3.23% as of March 31, 2009 primarily due to increased liquidity in the current quarter.

· Non-interest income for March 31, 2010 decreased $440,000 compared to the first quarter 2009 and increased $1.4 million compared to the linked quarter.  The first quarter 2010 included a loss of $577,000 due to other than temporary impairment (OTTI) and $285,000 of security gains.  The OTTI in the first quarter 2010 totaled $184,000, pretax, on seven private labeled mortgage backed securities and $393,000, with no tax benefit recorded, on two trust preferred securities.

· Non-interest expense for the first quarter 2010 was $39,000 less than first quarter 2009 and $1.5 million less than the linked quarter.

“We are pleased with our quarterly results and believe we have made significant progress as we continue through the current economic cycle,” said David W. Heeter, President and CEO.

Assets totaled $1.5 billion at March 31, 2010, an increase from December 31, 2009 of $88.1 million, or 6.3%. Gross loans, excluding loans held for sale, decreased $30.5 million, or 2.9%.  Consumer loans decreased $11.1 million, or 4.3%, commercial loans decreased $11.2 million, or 3.3%, and residential mortgage loans held in the portfolio decreased $8.2 million, or 1.7%. Residential mortgage loans held for sale increased $1.2 million and mortgage loans sold during the quarter totaled $14.3 million compared to $42.3 million sold in the first quarter of last year. The decrease in consumer lending was a result of the Bank suspending origination of indirect boat and recreational vehicle lending at the beginning of 2010, which accounted for approximately 49% of the consumer outstanding balances at the beginning of 2009.  The decrease in commercial loans was a result of several commercial loans paying down, some of which were loans of concern for the Bank.  Mortgage loan balances continue to decline as the Bank has sold a majority of the fixed rate production.  Investment securities available for sale increased $41.9 million, or 32.0%, primarily due to the current liquidity available to the Bank.

Allowance for loan losses was $16.6 million at March 31, 2010, an increase of $221,000 from December 31, 2009. Net charge offs for the quarter ended March 31, 2010 were $1.3 million, or .49% of average loans on an annualized basis compared to $967,000, or .34% of average loans for the comparable period in 2009.  On a linked quarter basis net charge offs decreased from an annualized .69% of average loans for the quarter ended December 31, 2009 to .49% for the current quarter.  The allowance for loan losses as a percentage of non-performing loans and total loans was 60.77% and 1.59%, respectively at March 31, 2010 compared to 50.38% and 1.53%, respectively at December 31, 2009.  Heeter commented, “We have seen a slight improvement in our asset quality this quarter. We continue to actively monitor and manage our loan portfolio, and we believe that our loan loss reserve adequately reflects our current risk profile.”

Total deposits were $1.1 billion at March 31, 2010 an increase of $77.2 million, or 7.4% from December 31, 2009. This increase was due to increases in certificates of deposit and savings deposits of $40.3 million and increases in demand and money market deposits of $36.9 million.  Total borrowings increased $8.7 million to $220.8 million at March 31, 2010 from $212.1 million at December 31, 2009 as the Bank has utilized longer term FHLB advances to help mitigate interest rate risk.

Stockholders’ equity was $130.3 million at March 31, 2010, an increase of $598,000, or 0.5% from December 31, 2009. The increase was due primarily to net income of $1.3 million and unrealized gains on securities of $112,000.  This increase was partially offset by dividend payments of $419,000 to common shareholders and $405,000 to preferred shareholders and net unrealized losses on derivatives of $88,000.  The Bank’s risk-based capital ratio was well in excess of “well-capitalized” levels as defined by all regulatory standards as of March 31, 2010.

Net interest income before the provision for loan losses increased $96,000 from $10.4 million for the three months ended March 31, 2009 to $10.5 million for the three months ended March 31, 2010. The primary reason for the increase was an increase in average earning assets of $30.6 million as a result of increased liquidity.  The increase in earning assets was partially offset by a decrease in net interest margin of 5 basis points to 3.18% in the first quarter 2010 compared to 3.23% for the first quarter 2009.  The decrease in net interest margin was primarily due to the low rate of return on the increased liquidity the Bank held in the first quarter of 2010.  On a linked quarter basis, net interest income before the provision for loan losses increased $207,000 primarily due to an increase in average earning assets of $50.8 million, partially offset by a 6 basis point reduction in net interest margin.

The provision for loan losses for the first quarter of 2010 was $1.5 million, approximately the same as last year’s comparable period.  Non-performing loans to total loans at March 31, 2010 were 2.62% compared to 3.03% at December 31, 2009.  This decrease in non-performing loans was primarily due to a decrease in all segments of the loan portfolio.  Non-performing assets to total assets were 2.44% at March 31, 2010 compared to 2.86% at December 31, 2009.

Non-interest income decreased $440,000 to $3.1 million for the three months ended March 31, 2010 compared to the same period in 2009. The decrease was primarily due to a reduction on gain on sale of loans of $672,000 as mortgage loan sales slowed as did production in comparison to the first quarter of 2009.  Another reason for the decline was other than temporary impairment on several trust preferred and private labeled mortgage backed securities in the amount of $577,000 compared to $200,000 of OTTI in the first quarter of 2009.  These decreases were partially offset by gains on sale of investments of $285,000 as the Bank liquidated several municipal securities, compared to gains on investments of $1,000 in the first quarter 2009.  Other increases included increases in service fees on transaction accounts of $50,000, increases in commission income of $314,000 and increases in other income of $53,000.  The increase in commission income was due primarily to commissions received from the trust and brokerage businesses for the quarter.  On a linked quarter basis, without one-time gains and impairment on securities, non-interest income increased by $61,000.

Non-interest expense decreased $39,000 for the three months ended March 31, 2010 compared to $10.4 million for the same period in 2009.  Decreases in current quarter non-interest expense compared to the same period in 2009 include decreases in salaries and employee benefits of $124,000, decreases in occupancy and equipment expense of $2,000, decreases in marketing expense of $65,000, decreases in intangible amortization of $44,000, and decreases in other expenses of $159,000.  These decreases were mostly offset by increases in data processing fees of $57,000, increases in FDIC premiums of $58,000, increases in software subscriptions and maintenance of $64,000 and increases in other repossessed asset expense of $169,000.  On a linked quarter basis, non-interest expense decreased by $1.5 million compared to the three months ended December 31, 2009, primarily due to a reduction in salaries and employee benefits along with a decrease in repossessed asset expense.  Heeter added, “Our employees worked diligently to identify and execute cost saves over the last several quarters.  Their efforts have helped reduce operating expenses substantially over the last few months.”

MutualFirst Financial, Inc. and MutualBank, an Indiana-based financial institution, has thirty-three full-service retail financial centers in Delaware, Elkhart, Grant, Kosciusko, Randolph, St. Joseph and Wabash Counties in Indiana.  MutualBank also has two Wealth Management and Trust offices located in Carmel and Crawfordsville, Indiana and a loan origination office in New Buffalo, Michigan.  MutualBank is a leading residential lender in each of the market areas it serves, and provides a full range of financial services including wealth management and trust services and Internet banking services.  The Company’s stock is traded on the NASDAQ National Market under the symbol “MFSF” and can be found on the internet at www.bankwithmutual.com.

Statements contained in this release, which are not historical facts, are forward-looking statements, as that term is defined in the Private Securities Reform Act of 1995.  Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ from those currently anticipated due to a number of factors, which include, but are not limited to, factors discussed in documents filed by the Company with the Securities and Exchange Commission from time to time.

MUTUALFIRST FINANCIAL INC.

	March 31,			December 31,
Balance Sheet (Unaudited):	2010			2009
	(000)			(000)
Assets
Cash and cash equivalents	$	122,004		$	46,341
Investment securities - AFS		172,844			130,914
Investment securities - HTM		7,664			8,147
Loans held for sale		3,719			2,521
Loans, gross		1,045,603			1,076,108
Allowance for loan loss		(16,635	)		(16,414	)
Net loans		1,028,968			1,059,694
Premise and equipment		34,099			34,556
FHLB of Indianapolis stock		18,632			18,632
Investment in limited partnerships		4,033			4,161
Cash surrender value of life insurance		44,630			44,247
Prepaid FDIC premium		5,491			5,907
Core deposit and other intangibles		5,528			5,881
Deferred income tax benefit		19,534			19,514
Other assets		19,985			18,519
Total assets		1,487,131			1,399,034
Liabilities and Stockholders' Equity
Deposits		1,122,387			1,045,196
Borrowings		220,753			212,074
Other liabilities		13,665			12,037
Stockholders' equity		130,326			129,727
Total liabilities and stockholders' equity		1,487,131			1,399,034

	Three Months			Three Months			Three Months
	Ended			Ended			Ended
	March 31,			December 31,			March 31,
Income Statement (Unaudited):	2010			2009			2009
	(000)			(000)			(000)
Total interest income	$	17,244		$	17,378		$	18,656
Total interest expense		6,756			7,097			8,264
Net interest income		10,488			10,281			10,392
Provision for loan losses		1,525			1,650			1,450
Net interest income after provision
for loan losses		8,963			8,631			8,942
Non-interest income
Fees and service charges		1,740			1,936			1,690
Net gain (loss) on sale of investments		285			336			1
Other than temporary impairment of securities		(577	)		(2,355	)		(200	)
Equity in losses of limited partnerships		(127	)		341			(78	)
Commissions		942			849			628
Net gain (loss) on loan sales		354			206			1,026
Net servicing fees		37			52			77
Increase in cash surrender value of life insurance		383			390			386
Other income		104			25			51
Total non-interest income		3,141			1,780			3,581
Non-interest expense
Salaries and benefits		5,336			6,076			5,460
Occupancy and equipment		1,425			1,482			1,427
Data processing fees		411			407			354
Professional fees		342			319			335
Marketing		298			397			363
Deposit insurance		446			414			388
Software subscriptions and maintenance		397			334			333
Intangible amortization		353			359			397
Repossessed assets expense		467			899			298
Other expenses		859			1,191			1,018
Total non-interest expense		10,334			11,878			10,373
Income before taxes		1,770			(1,467	)		2,150
Income tax provision		426			(278	)		354
Net income		1,344			(1,189	)		1,796
Preferred stock dividends and amortization		451			451			451
Net income available to common shareholders	$	893		$	(1,640	)	$	1,345

Average Balances,  Net Interest Income, Yield Earned and Rates Paid

			Three							Three
			mos ended							mos ended
			3/31/2010							3/31/2009
	Average		Interest		Average			Average		Interest		Average
	Outstanding		Earned/		Yield/			Outstanding		Earned/		Yield/
	Balance		Paid		Rate			Balance		Paid		Rate
	(000)		(000)					(000)		(000)
Interest-Earning Assets:
Interest -bearing deposits	$	88,659	$	43		0.19	%	$	39,498	$	10		0.10	%
Mortgage-backed securities:
Available-for-sale		124,320		1,348		4.34			66,559		942		5.66
Held-to-maturity		8,011		132		6.59			9,917		187		7.54
Investment securities:
Available-for-sale		16,275		127		3.12			24,830		270		4.35
Loans receivable		1,063,219		15,500		5.83			1,129,098		17,128		6.07
Stock in FHLB of Indianapolis		18,632		94		2.02			18,632		119		2.55
Total interest-earning assets (3)		1,319,116		17,244		5.23			1,288,534		18,656		5.79
Non-interest earning assets, net of allowance
for loan losses and unrealized gain/loss		139,194							127,302
Total assets	$	1,458,310						$	1,415,836
Interest-Bearing Liabilities:
Demand and NOW accounts	$	176,835		198		0.45		$	161,606		200		0.50
Savings deposits		87,620		34		0.16			81,414		66		0.32
Money market accounts		63,689		147		0.92			43,113		129		1.20
Certificate accounts		658,590		4,325		2.63			625,195		5,205		3.33
Total deposits		986,734		4,704		1.91			911,328		5,600		2.46
Borrowings		225,205		2,052		3.64			262,766		2,664		4.06
Total interest-bearing accounts		1,211,939		6,756		2.23			1,174,094		8,264		2.82
Non-interest bearing deposit accounts		102,122							93,129
Other liabilities		13,879							17,177
Total liabilities		1,327,940							1,284,400
Stockholders' equity		130,370							131,436
Total liabilities and stockholders' equity	$	1,458,310						$	1,415,836
Net earning assets	$	107,177						$	114,440
Net interest income			$	10,488						$	10,392
Net interest rate spread						3.00	%						2.98	%
Net yield on average interest-earning assets						3.18	%						3.23	%
Average interest-earning assets to
average interest-bearing liabilities						108.84	%						109.75	%

	Three Months			Three Months			Three Months
	Ended			Ended			Ended
	March 31,			December 31,			March 31,
Selected Financial Ratios and Other Financial Data (Unaudited):	2010			2009			2009
Share and per share data:
Average common shares outstanding
Basic		6,861,589			6,853,643			6,825,544
Diluted		6,864,138			6,853,672			6,825,544
Per common share:
Basic earnings	$	0.13		$	(0.24	)	$	0.20
Diluted earnings	$	0.13		$	(0.24	)	$	0.20
Dividends	$	0.06		$	0.06		$	0.12
Dividend payout ratio		46.15	%		-25.00	%		60.00	%
Performance Ratios:
Return on average assets (ratio of net
income to average total assets)(1)		0.37	%		-0.34	%		0.51	%
Return on average tangible common equity (ratio of net
income to average tangible common equity)(1)		3.87	%		-7.06	%		5.86	%
Interest rate spread information:
Average during the period(1)		3.00	%		3.00	%		2.98	%
Net interest margin(1)(2)		3.18	%		3.24	%		3.23	%
Efficiency Ratio		75.82	%		98.48	%		74.24	%
Ratio of average interest-earning
assets to average interest-bearing
liabilities		108.84	%		110.67	%		109.75	%
Allowance for loan losses:
Balance beginning of period	$	16,414		$	16,620		$	15,107
Charge offs:
One- to four- family		465			979			100
Multi-family		0			0			0
Commercial real estate		344			169			365
Construction or development		0			0			0
Consumer loans		895			994			660
Commercial business loans		0			0			57
Sub-total		1,704			2,142			1,182
Recoveries:
One- to four- family		85			16			77
Multi-family		0			0			0
Commercial real estate		68			6			0
Construction or development		0			0			0
Consumer loans		247			264			136
Commercial business loans		0			0			2
Sub-total		400			286			215
Net charge offs		1,304			1,856			967
Additions charged to operations		1,525			1,650			1,450
Balance end of period	$	16,635		$	16,414		$	15,590
Net loan charge-offs to average loans (1)		0.49	%		0.69	%		0.34	%

	March 31,			December 31,			March 31,
	2010			2009			2009
Total shares outstanding		6,984,754			6,984,754			6,984,754
Tangible book value per share	$	13.23		$	13.09		$	12.90
Tangible common equity to tangible assets		6.42	%		6.77	%		6.59	%
Nonperforming assets (000's)
Non-accrual loans
One- to four- family	$	14,234		$	14,617		$	10,253
Commercial real estate		7,309			8,986			7,934
Consumer loans		2,435			3,610			2,203
Commercial business loans		1,561			1,873			1,075
Total non-accrual loans		25,539			29,086			21,465
Accruing loans past due 90 days or more		0			1,934			715
Restructured loans		1,833			1,563			292
Total nonperforming loans		27,372			32,583			22,472
Real estate owned		6,762			5,424			2,659
Other repossessed assets		2,027			1,927			1,865
Nonperforming securities		100			100			0
Total nonperforming assets	$	36,261		$	40,034		$	26,996
Asset Quality Ratios:
Non-performing assets to total assets		2.44	%		2.86	%		1.90	%
Non-performing loans to total loans		2.62	%		3.03	%		2.03	%
Allowance for loan losses to non-performing loans		60.77	%		50.38	%		69.38	%
Allowance for loan losses to loans receivable		1.59	%		1.53	%		1.41	%

(1)	Ratios for the three month period have been annualized.
(2)	Net interest income divided by average interest earning assets.
(3)	Calculated net of deferred loan fees, loan discounts, loans in process and loss reserves.