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 19, 2007
Horizon Bancorp
(Exact Name of Registrant as Specified in Its Charter)
Indiana	000-10792	35-1562417
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)
515 Franklin Square, Michigan City, Indiana		46360
(Address of Principal Executive Offices)		(Zip Code)
(219) 879-0211
(Registrant’s Telephone Number, Including Area Code)
(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 (see General Instruction A.2. below):

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

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

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

¨ 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

This Current Report on Form 8-K is being filed to furnish the earnings release issued by the Registrant on April 19, 2007. A copy of the press release is attached as Exhibit 99.1 to this Current Report. The information disclosed under this Item 2.02, including Exhibit 99.1 hereto, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, and shall not be deemed incorporated by reference into any filing made under the Securities Act of 1933, except as expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

(d)  Exhibits
Exhibit No.	Description
99.1	Press Release issued April 19, 2007

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 hereto duly authorized.

Date: April 20, 2007	Horizon Bancorp
	By:	/s/ James H. Foglesong
		James H. Foglesong, Chief Financial Officer

EXHIBIT INDEX

Exhibit No.	Description	Location
99.1	Press Release issued April 19, 2007	Attached

EX-99.1

Exhibit 99.1

Contact: James H. Foglesong

Chief Financial Officer

Phone: (219) 873-2608

Fax: (219) 874-9280

Date: April 19, 2007

FOR IMMEDIATE RELEASE

Horizon Bancorp Announces Increased First Quarter Earnings

Michigan City, Indiana (NasdaqGM: HBNC) - Horizon Bancorp today announced its unaudited financial results for the quarter ended March 31, 2007. Net income for the first quarter of 2007 was $1.844 million or $.57 per fully diluted share. This compares to $1.449 million or $.45 per fully diluted share for the same quarter of the prior year. This represents a 27.3% increase in net income from the first quarter of the prior year.

Craig M. Dwight, President and Chief Executive Officer stated, “We are pleased with the improvement in net income from the first quarter of 2006. Recent history demonstrates that the first quarter is typically Horizon’s lowest performing quarter during the year due to the seasonality of our mortgage business lines. As a result of this seasonality, Horizon’s first quarter earnings are down from the fourth quarter 2006 earnings of $2.233 million. The entire Horizon team is proud of the first quarter results and we are pleased that actions taken last year to improve earnings are having a positive impact.”

Net interest income for the quarter ended March 31, 2007 was $7.636 million, a decrease of $174 thousand from the first quarter of 2006. The net interest margin declined 34 basis points from the first quarter of 2006 to 2.85%. Being liability sensitive, Horizon’s cost of funds increased faster than the yield on earning assets. Although the Federal Reserve Board has not increased short term interest rates since June of 2006, the overall cost of certificates of deposit (CDs), Horizon’s largest single source of funds, continues to increase as CDs renew at higher rates. The overall cost of consumer CDs has increased 68 basis points while the cost of negotiated CDs (normally those with balances in excess of $100 thousand and short maturities) have increased 88 basis points from the first quarter of 2006. Growth in earning assets of $88 million or 8.8% offset much of the decrease caused by the interest margin decline. Contributing to net interest income in the first quarter of 2006 was approximately $205 thousand of income, from commercial loans that were acquired at a discount in the Alliance acquisition and were paid in full during that quarter. Without this income, the net interest margin for the first quarter of 2006 would have been 3.11% instead of 3.19%. There was no similar income during the first quarter of 2007.

The provision for loan losses decreased to $225 thousand for the first quarter of 2007 from $380 thousand for the first quarter of the prior year. Favorable loan loss experience and overall credit quality support the current quarterly provision. Non-performing loans at March 31, 2007 were 0.38% of total loans compared to 0.23% at March 31, 2006. This increase is due primarily to one residential developer and their related loans which are all secured by first mortgages on one to four family residential real estate. While showing an increase, this level is still below industry averages. Management feels the total allowance of $8.620 million or 1.07% of total loans is adequate to absorb losses contained in the loan portfolio.

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Pg. 2 Cont. Horizon Announces 1st Quarter Earnings

Non-interest income increased $834 thousand or 41% from the first quarter of 2006. Increases occurred in all categories of non-interest income. The main contributing factors included: (a) NSF fees increased due to changes made to the overdraft protection program and an increase in the per item fee, (b) Fiduciary activity fees increased due to an increase in assets under administration and increased ESOP administration fees, (c) Gain on sale of loans increased as Horizon sold a higher percent of its mortgage loan production. During the first quarter of 2007 Horizon sold approximately $28 million of current mortgage production while in the first quarter of 2006 a total of $17 million was sold. (d) No gains or losses on the sale of securities were recorded during the first quarter of 2007 while a loss of $158 thousand was taken during the first quarter of 2006.

Non-interest expense increased $342 thousand or 4.5% from the first quarter of 2006. The increase in compensation relates to normal salary increases and the addition of a new product line known as wholesale mortgage lending and its related staff additions. The increase in professional fees relates to legal expense involved with the issuance of additional Bank Owned Life Insurance.

On March 31, 2007, Horizon’s total assets were $1.152 billion, compared to $1.222 billion on December 31, 2006. Cash and cash equivalents declined due to a large cash item deposited on the last day of 2006. Loans declined $34 million since December 31, 2006. The decline came almost entirely in the mortgage warehouse area due to a general slow down in residential mortgage activity. There were minor fluctuations in the other lending categories.

Deposits declined, as a large deposit made by a local municipality at year-end 2006 was withdrawn in the normal course of business in early January 2007. Total average deposits for the first quarter of 2007 declined only $15 million or 1.7% from the fourth quarter of 2006.

Long-term borrowings increased to reduce the company’s exposure to fluctuations in short-term interest rates and to cover the loss of deposits since year-end. In addition, as previously announced in an 8-K filing with the SEC on March 27, 2007, Horizon redeemed $12 million of its trust-preferred securities on March 26, 2007. This redemption was funded with the proceeds from the issuance of $12 million in new floating rate trust preferred securities issued on December 15, 2006. Horizon estimates that the combined effect of the redemption and new issuance of these trust preferred securities will reduce interest expense by approximately $180 thousand in 2007 and by $234 thousand annually through 2011.

Stockholders' equity totaled $64.5 million at March 31, 2007 compared to $61.9 million at December 31, 2006. The increase in stockholders' equity during the quarter was the result of net income, an increase in the market value of investment securities available for sale and the issuance of new shares for the exercise of stock options, reduced by dividends declared. Also affecting total equity was a reduction of Horizon’s accrued tax liability for an uncertain tax position related to Horizon’s investment subsidiary incorporated in Nevada. Horizon reduced its liability by $563 thousand under Financial Accounting Standards Board Interpretation 48 with a credit taken directly to retained earnings as a cumulative effect adjustment for a change in accounting principle. At March 31, 2007, the ratio of stockholders' equity to total assets was 5.60% compared to 5.06% at December 31, 2006. Book value per common share at March 31, 2007 increased to $20.17 compared to $19.11 at December 31, 2006.

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Pg. 3 Cont. Horizon Announces 1st Quarter Earnings

Other items

A new full service branch will open in Benton Harbor, Michigan in April 2007.

Construction is scheduled to begin on a second full service branch in Valparaiso, Indiana in May 2007 with an opening date anticipated for the third quarter of 2007.

Horizon Bancorp is a locally owned, independent, commercial bank holding company serving Northern Indiana and Southwest Michigan. Horizon also offers mortgage-banking services throughout the Midwest. Horizon Bancorp may be reached on the World Wide Web at www.accesshorizon.com. Its common stock is traded on the NASDAQ Global Market under the symbol HBNC.

Statements in this press release which express “belief,” “intention,” “expectation,” and similar expressions, identify forward-looking statements. Such forward-looking statements are based on the beliefs of the Company’s management, as well as assumptions made by, and information currently available to, such management. Such statements are inherently uncertain and there can be no

assurance that the underlying assumptions will prove to be accurate. Actual results could differ materially from those contemplated by the forward-looking statements. Any forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Contact:	Horizon Bancorp
	James H. Foglesong
	Chief Financial Officer
	(219) 873 - 2608
	Fax: (219) 874-9280

# # #

HORIZON BANCORP

Financial Highlights

(Unaudited - dollars in thousands except share and per share data and ratios)

	Three months ended
	March 31,			December 31,			March 31,
	2007			2006			2006
End of period balances:
Total assets	$	1,151,886		$	1,222,430		$	1,072,983
Investment securities		234,823			243,078			250,103
Commercial loans		276,732			271,457			266,526
Mortgage warehouse loans		79,504			112,267			88,871
Real estate loans		219,305			222,210			178,236
Installment loans		232,767			238,688			204,953
Non-interest bearing deposit accounts		87,341			81,949			89,615
Interest bearing transaction accounts		352,301			468,624			366,135
Time deposits		390,102			363,400			322,160
Short-term borrowings		62,279			83,842			76,754
Long-term borrowings		160,940			115,951			129,098
Stockholder’s equity		64,493			61,877			55,096
Average balances :
Total assets	$	1,161,105		$	1,175,760		$	1,065,928
Investment securities		240,443			239,111			253,523
Commercial loans		273,019			267,535			273,043
Mortgage warehouse loans		86,587			111,336			79,189
Real estate loans		221,202			231,027			169,306
Installment loans		235,665			236,369			202,871
Non-interest bearing deposit accounts		74,078			79,229			76,715
Interest bearing transaction accounts		355,590			345,485			372,758
Time deposits		419,736			439,393			330,945
Short-term borrowings		68,930			87,797			61,476
Long-term borrowings		135,434			127,068			135,662
Stockholder’s equity		63,089			61,300			55,483
Per share data:
Basic earnings per share	$	.58		$	.70		$	.46
Diluted earnings per share		.57			.69			.45
Cash dividends declared per common share		.14			.14			.14
Book value per common share		20.17			19.11			17.31
Market value - high		28.10			27.89			32.23
Market value - low		26.60			25.92			26.30
Basic common shares outstanding		3,194,309			3,193,306			3,142,219
Diluted common shares outstanding		3,239,479			3,238,648			3,202,036
Key ratios:
Return on average assets		.64	%		.75	%		.55	%
Return on average equity		11.85			14.57			10.59
Net interest margin		2.85			2.97			3.19
Loan loss reserve to loans		1.07			1.03			1.17
Non-performing loans to loans		.38			.31			.23
Average equity to average assets		5.43			5.21			5.21
Bank only capital ratios:
Tier 1 capital to average assets		7.13			6.91			7.31
Tier 1 capital to risk weighted assets		10.28			10.03			10.83
Total capital to risk weighted assets		12.37			11.12			12.05

HORIZON BANCORP AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Dollar Amounts in Thousands)

	March 31, 2007 (Unaudited)			December 31, 2006
Assets
Cash and due from banks	$	20,857		$	52,311
Interest-bearing demand deposits		1			1
Federal funds sold		0			6,500
Cash and cash equivalents		20,858			58,812
Interest-bearing deposits		1,277			898
Investment securities, available for sale		234,823			243,078
Loans held for sale		16,171			13,103
Loans, net of allowance for loan losses of $8,620 and $8,738		799,688			835,096
Premises and equipment		23,513			23,394
Federal Reserve and Federal Home Loan Bank stock		12,136			12,136
Goodwill		5,787			5,787
Other intangible assets		2,323			2,412
Interest receivable		5,759			6,094
Other assets		29,551			21,620
Total assets	$	1,151,886		$	1,222,430
Liabilities
Deposits
Noninterest bearing	$	87,341		$	81,949
Interest bearing		742,403			832,024
Total deposits		829,744			913,973
Short-term borrowings		62,279			83,842
Long-term borrowings		160,940			115,951
Subordinated debentures		27,837			40,209
Interest payable		1,719			1,771
Other liabilities		4,874			4,807
Total liabilities		1,087,393			1,160,553
Stockholders’ Equity
Preferred stock, no par value
Authorized, 1,000,000 shares
No shares issued
Common stock, $.2222 stated value
Authorized, 22,500,000 shares
Issued, 5,001,506 and 4,998,106 shares		1,112			1,111
Additional paid-in capital		25,347			25,229
Retained earnings		56,149			54,196
Accumulated other comprehensive income (loss)		(963	)		(1,507	)
Less treasury stock, at cost, 1,759,424 shares		(17,152	)		(17,152	)
Total stockholders’ equity		64,493			61,877
Total liabilities and stockholders’ equity	$	1,151,886		$	1,222,430

HORIZON BANCORP AND SUBSIDIARIES

Condensed Consolidated Statements of Income

(Dollar Amounts in Thousands, Except Per Share Data)

	Three Months Ended March 31
	2007 (Unaudited)		2006 (Unaudited)
Interest Income
Loans receivable	$	14,984	$	12,773
Investment securities:
Taxable		2,103		2,167
Tax exempt		861		723
Total interest income		17,948		15,663
Interest Expense
Deposits		7,294		5,293
Federal funds purchased and short-term borrowings		837		398
Long-term borrowings		1,415		1,650
Subordinated debentures		766		512
Total interest expense		10,312		7,853
Net Interest Income		7,636		7,810
Provision for loan losses		225		380
Net Interest Income after Provision for Loan Losses		7,411		7,430
Other Income
Service charges on deposit accounts		778		686
Wire transfer fees		94		86
Fiduciary activities		804		663
Gain on sale of loans		550		303
Increase in cash surrender value of Bank owned life insurance		232		108
Loss on sale of securities		-		(158	)
Other income		407		343
Total other income		2,865		2,031
Other Expenses
Salaries and employee benefits		4,369		4,234
Net occupancy expenses		617		618
Data processing and equipment expenses		637		640
Professional fees		369		241
Outside services and consultants		617		283
Loan expense		259		225
Other expenses		272		1,273
Total other expenses		7,856		7,514
Income Before Income Tax		2,420		1,947
Income tax expense		576		498
Net income	$	1,844	$	1,449
Basic Earnings Per Share	$	.58	$	.46
Diluted Earnings Per Share	$	.57	$	.45