EX-99.1

Exhibit 99.1

Contact: James H. Foglesong
Chief Financial Officer
Phone: (219) 873-2608
Fax: (219) 874-9280
Date: July 27, 2006
FOR IMMEDIATE RELEASE

Horizon Bancorp Announces Second Quarter Earnings

Michigan City, Indiana (July 27, 2006) — Horizon Bancorp today announced its unaudited financial results for the quarter and six months ended June 30, 2006. Net income for the second quarter of 2006 was $1.834 million or $.57 per fully diluted share. This compares to $1.680 million or $.53 per fully diluted share for the same quarter of the prior year. Year to date net income was $3.283 million or $1.02 per fully diluted share compared to $2.983 million or $.95 per fully diluted share for the same period of the prior year. This represents a 9.2% increase in quarterly net income and a 10.0% increase for the first six months when compared to the same prior year periods.

Craig M. Dwight, President and Chief Executive Officer stated, “We are pleased to report increased net income despite a declining net interest margin and recognizing a $249 thousand pre-tax loss on investment portfolio restructuring. The acquisition of Alliance Bank, completed in June of 2005, contributed to the increase.”

Net interest income for the quarter ended June 30, 2006 was $7.836 million, an increase of $557 thousand or 7.7% over the same period of the prior year. This increase resulted from an increase in average earning assets from the same quarter of the prior year of $101.2 million or 10.1%. The impact from the growth in earning assets was partially offset by a decline in net interest margin from 3.22% for the second quarter of 2005 to 3.11% in the second quarter of 2006. For the first six months of 2006 net interest income was $15.646 million compared to $14.052 million, an increase of 11.3%. The major factor causing the increase was growth in earning assets, again partially offset by a decline in net interest margin. The net interest margin for the first six months of 2006 was 3.15% compared to 3.24% for the same period of 2005. Contributing to net interest income in the first six months of 2006 was approximately $330 thousand of income, related to commercial loans that were acquired at a discount in the Alliance Bank acquisition and were paid in full during the period. Without this income, the net interest margin would have been 3.09%.

Non-interest income decreased $106 thousand or 4.3% from the second quarter of 2005 and has decreased $355 thousand or 7.5 % for the first six months. The main contributing factors were: (a) a decrease in the gain on sale of loans due to a decline in the volume of loans originated that were available for sale, and (b) a loss on the sale of investment securities of $158 thousand in the first quarter and $91 thousand in the second quarter. In the first six months of 2006, Horizon sold approximately $70 million of low yielding investment securities, recognizing a loss on the these sales. The proceeds from the sale will be used to reduce short-term debt, fund loan growth and reinvest in higher yielding securities. Affecting year-to-date income compared to 2005 was approximately $160 thousand in pre-tax income from the sale of the retail property and casualty insurance lines of Horizon Insurance Services, Inc, in the first quarter of 2005.

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Pg. 2 Cont. Horizon’s 2^nd Quarter Earnings

Non-interest expense increased $418 thousand or 6.0% from the second quarter of 2005 and $954 thousand or 6.8% for the first six months. This increase relates primarily to additional on-going expenses related to the Alliance Bank acquisition, which closed in June of 2005, including core deposit intangible amortization of approximately $186 thousand.

On June 30, 2006, Horizon’s total assets were $1.131 billion, compared to $1.128 billion on December 31, 2005. Cash and cash equivalents declined due to a large cash item deposited on the last day of 2005. Investment securities decreased due to the above mentioned security sale. Loans have increased $62 million or 8.6% since December 31, 2005. Growth came in all loan categories except commercial where unanticipated payoffs caused a decline in commercial loans outstanding. Deposits declined, as a large deposit made by a local municipality at year-end 2005 was withdrawn in their normal course of business in early January 2006. Total average deposits for the second quarter of 2006 increased $14 million or 1.8% from the first quarter of 2006. Growth came in certificates of deposit, both consumer and negotiated. This was partially offset by a decline in public fund money market accounts.

Horizon’s allowance for loan losses at June 30, 2006 was $8.8 million, or 1.13% of gross loans, compared to $8.4 million or 1.14% at December 31, 2005. Non-performing assets at June 30, 2006 were $1.4 million, or 0.17% of gross loans, compared to $2.1 million or .28% at December 31, 2005. The decrease in non-performing assets occurred primarily in commercial loans. Year to date net charge-offs total $130 thousand compared to $260 for the same period of the prior year.

Stockholders’ equity totaled $54.6 million at June 30, 2006 compared to $53.5 million at December 31, 2005. At June 30, 2006, the ratio of stockholders’ equity to total assets was 4.83% compared to 4.75% at December 31, 2005. Book value per common share at June 30, 2006 increased to $17.15 compared to $17.01 at December 31, 2005. The increase in stockholders’ equity during the year was the result of net income and the issuance of new shares for the exercise of stock options, offset by dividends declared, a decrease in the market value of investment securities available for sale, and the purchase of treasury stock.

Other items

A full service branch was opened in Elkhart, Indiana during June of 2006. Horizon has operated a loan production office in Elkhart since March of 2004.

Horizon will soon begin construction of a branch in Benton Township, Michigan. This branch is scheduled to open during the first quarter of 2007.

Horizon Bank has signed an agreement to sell substantially all of its mortgage servicing rights, which have a book value of approximately $1.0 million at June 30, 2006. The sale, scheduled to close in the third quarter of 2006, will generate a pre-tax gain of approximately $550 thousand.

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Pg. 3 Cont. Horizons 2^nd Quarter Earnings

Horizon Bancorp is a locally owned, independent, bank holding company serving northern Indiana and southwest Michigan. Horizon offers banking, investment and trust services from offices located in Michigan City, LaPorte, Wanatah, Chesterton, Portage, Valparaiso, Elkhart, South Bend and Merrillville, Indiana, and Harbert, New Buffalo, St. Joseph and Three Oaks, Michigan and provides 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 Capital 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:									Six Months Ended:
	June 30,			March 31,			June 30,			June 30,			June 30,
	2006			2006			2005			2006			2005

End of period balances:
Total assets	$	1,131,141		$	1,072,983		$	1,098,613		$	1,131,141		$	1,098,613
Investment securities		242,262			250,103			301,185			242,262			301,185
Commercial loans		266,999			266,526			261,906			266,999			261,906
Mortgage warehouse loans		106,432			88,871			115,120			106,432			115,120
Real estate loans		198,728			178,236			131,935			198,728			131,935
Installment loans		222,885			204,953			183,723			222,885			183,723
Non-interest bearing deposit accounts		86,427			89,615			75,242			86,427			75,242
Interest bearing transaction accounts		423,335			366,135			358,911			423,335			358,911
Time deposits		330,353			322,160			370,675			330,353			370,675
Short-term borrowings		72,988			76,754			72,712			48,988			72,712
Long-term borrowings		129,027			129,098			132,680			153,027			132,680
Stockholder’s equity		54,627			55,096			52,831			54,627			52,831

Average balances :
Total assets	$	1,090,753		$	1,065,928		$	980,481		$	1,078,410		$	931,321
Investment securities		240,106			253,523			296,709			246,797			291,312
Commercial loans		265,044			273,043			222,302			269,110			214,147
Mortgage warehouse loans		93,741			79,189			100,852			86,505			99,472
Real estate loans		187,471			169,306			113,042			176,509			105,257
Installment loans		211,489			202,871			163,773			206,596			155,289
Non-interest bearing deposit accounts		79,074			76,715			71,257			77,901			67,401
Interest bearing transaction accounts		345,603			372,758			299,953			366,166			288,845
Time deposits		369,805			330,945			309,594			350,482			299,538
Short-term borrowings		55,142			61,809			65,267			53,817			56,662
Long-term borrowings		158,316			135,329			161,824			149,869			161,764
Stockholder’s equity		55,736			55,483			51,803			55,610			51,675

Per share data:
Basic earnings per share	$	0.58		$	.46		$	0.55		$	1.04		$	0.98
Diluted earnings per share		0.57			.45			0.53			1.02			0.95
Cash dividends declared per common share		0.14			.14			0.13			0.28			0.26
Book value per common share		17.15			17.31			16.98			17.15			16.98
Market value — high		31.00			32.23			30.00			32.23			31.51
Market value — low		25.16			26.30			24.20			25.16			24.20
Basic average common shares outstanding		3,183,870			3,142,219			3,066,512			3,163,159			3,041,698
Diluted average common shares outstanding		3,209,294			3,202,036			3,157,731			3,205,780			3,149,164

Key ratios:
Return on average assets		0.67	%		0.55	%		0.69	%		0.61	%		0.64	%
Return on average equity		13.16			10.59			12.97			11.91			11.55
Net interest margin		3.11			3.26			3.22			3.15			3.24
Loan loss reserve to loans		1.13			1.17			1.18			1.13			1.18
Non-performing loans to loans		0.17			0.23			0.29			0.17			0.29
Average equity to average assets		5.11			5.21			5.28			5.16			5.55
Bank only capital ratios:
Tier 1 capital to average assets		7.24	%		7.31	%		7.61	%		7.24	%		7.61	%
Tier 1 capital to risk weighted assets		10.40			10.83			10.69			10.40			10.69
Total capital to risk weighted assets		11.57			12.05			11.88			11.57			11.88

Horizon Bancorp and Subsidiaries
Condensed Consolidated Balance Sheets
(Dollar Amounts in Thousands)


	June 30,
	2006			December 31,
	(Unaudited)			2005


Assets
Cash and due from banks	$	23,407		$	39,163
Interest-bearing demand deposits		1			87

Cash and cash equivalents		23,408			39,250
Interest-bearing deposits		1,698			15,735
Investment securities, available for sale		242,262			275,177
Loans held for sale		4,754			2,440
Loans, net of allowance for loan losses of $8,843 and $8,368		786,201			724,366
Premises and equipment		22,550			21,425
Federal Reserve and Federal Home Loan Bank stock		13,014			12,983
Goodwill		5,787			5,787
Other intangible assets		2,594			2,780
Interest receivable		5,365			5,813
Other assets		23,508			22,119


Total assets	$	1,131,141		$	1,127,875


Liabilities
Deposits
Noninterest bearing	$	86,427		$	148,127
Interest bearing		753,688			707,439

Total deposits		840,115			855,566
Short-term borrowings		72,988			50,024
Long-term borrowings		129,027			133,609
Subordinated debentures		27,837			27,837
Interest payable		1,442			1,663
Other liabilities		5,105			5,646

Total liabilities		1,076,514			1,074,345


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, 4,852,751 and 4,990,206 shares		1,109			1,092
Additional paid-in capital		24,970			24,552
Retained earnings		50,902			48,523
Restricted stock, unearned compensation		—			(760	)
Accumulated other comprehensive income (loss)		(5,202	)		(2,853	)
Less treasury stock, at cost, 1,759,424 and 1,755,158 shares		(17,152	)		(17,024	)

Total stockholders’ equity		54,627			53,530


Total liabilities and stockholders’ equity	$	1,131,141		$	1,127,875

Horizon Bancorp and Subsidiaries
Condensed Consolidated Statements of Income
(Dollar Amounts in Thousands, Except Per Share Data)


	Three Months Ended June 30					Six Months Ended June 30
	2006			2005		2006			2005
	(Unaudited)			(Unaudited)		(Unaudited)			(Unaudited)


Interest Income
Loans receivable	$	13,829		$	10,171	$	26,602		$	19,054
Investment securities
Taxable		2,059			2,485		4,226			4,826
Tax exempt		762			579		1,485			1,150

Total interest income		16,650			13,235		32,313			25,030


Interest Expense
Deposits		5,977			3,656		11,270			6,613
Federal funds purchased and short-term borrowings		592			654		990			827
Long-term borrowings		1,697			1,309		3,347			2,897
Subordinated debentures		548			337		1,060			641

Total interest expense		8,814			5,956		16,667			10,978


Net Interest Income		7,836			7,279		15,646			14,052
Provision for loan losses		225			381		605			711


Net Interest Income after Provision for Loan Losses		7,611			6,898		15,041			13,341


Other Income
Service charges on deposit accounts		778			583		1,464			1,121
Wire transfer fees		103			117		189			206
Fiduciary activities		810			692		1,473			1,319
Commission income from insurance agency		-0-			-0-		-0-			46
Gain on sale of loans		325			478		628			867
Increase in cash surrender value of Bank owned life insurance		118			122		226			236
Loss on sale of securities		(91	)				(249	)
Other income		336			493		679			970

Total other income		2,379			2,485		4,410			4,765


Other Expenses
Salaries and employee benefits		4,062			4,100		8,296			8,250
Net occupancy expenses		561			486		1,179			1,007
Data processing and equipment expenses		659			525		1,299			1,032
Other expenses		2,143			1,896		4,165			3,696

Total other expenses		7,425			7,007		14,939			13,985


Income Before Income Tax		2,565			2,376		4,512			4,121
Income tax expense		731			696		1,229			1,138


Net Income	$	1,834		$	1,680	$	3,283		$	2,983


Basic Earnings Per Share	$	.58		$	.55	$	1.04		$	.98

Diluted Earnings Per Share	$	.57		$	.53	$	1.02		$	.95