-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, R22U15qv3feoFwBWap41djyLsA9g1WuciqYU7sNjr0wQCLZsnprkUhSGRSjKNplP 1RLPBw1OprUm2ZJh0gKaTQ== 0000712534-05-000075.txt : 20050420 0000712534-05-000075.hdr.sgml : 20050420 20050420123059 ACCESSION NUMBER: 0000712534-05-000075 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20050420 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050420 DATE AS OF CHANGE: 20050420 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FIRST MERCHANTS CORP CENTRAL INDEX KEY: 0000712534 STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021] IRS NUMBER: 351544218 STATE OF INCORPORATION: IN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-17071 FILM NUMBER: 05761243 BUSINESS ADDRESS: STREET 1: 200 E JACKSON ST STREET 2: PO BOX 792 CITY: MUNCIE STATE: IN ZIP: 47308-0792 BUSINESS PHONE: 7657471500 MAIL ADDRESS: STREET 1: 200 EAST JACKSON STREET CITY: MUNCIE STATE: IN ZIP: 47305 8-K 1 f8ker042005.txt PRESS RELEASE 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 20, 2005 ------------------------------ FIRST MERCHANTS CORPORATION (Exact name of registrant as specified in its charter) ------------------------------- INDIANA 0-17071 35-1544218 (State or other jurisdiction (Commission file number) (IRS Employer of incorporation) Identification No.) 200 East Jackson Street P.O. Box 792 Muncie, IN 47305-2814 (Address of principal executive offices, including zip code) (765) 747-1500 (Registrant's telephone number, including area code) 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: [ ] 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)) Page 1 of 10 ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION. On April 20, 2005, First Merchants Corporation issued a press release to report its financial results for the first quarter ended March 31, 2005. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K. The information in this Current Report on Form 8-K, including Exhibit No. 99.1 hereto, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to liability of that section. The information in this Current Report shall not be incorporated by reference into any filing or other document pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing or document. ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS. (a) Not applicable. (b) Not applicable. (c) Exhibits. Exhibit 99.1 Press Release, dated April 20, 2005, issued by First Merchants Corporation Page 2 of 10 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 hereunto duly authorized. First Merchants Corporation (Registrant) By: /s/ Mark K. Hardwick -------------------------------------------- Mark K. Hardwick Senior Vice President and Chief Financial Officer (Principal Financial and Chief Accounting Officer) Dated: April 20, 2005 Page 3 of 10 EXHIBIT INDEX ------------- Exhibit No. - ----------- 99.1 Description ----------- Press Release, dated April 20, 2005, issued by First Merchants Corporation. Page 4 of 10 First Merchants Corporation Exhibit No. 99.1 Press Release, dated April 20, 2005 N / E / W / S R / E / L / E / A / S / E April 20, 2005 FOR IMMEDIATE RELEASE For more information, contact: Mark K. Hardwick, Senior Vice President/Chief Financial Officer, 765-751-1857 http://firstmerchants.com SOURCE: First Merchants Corporation, Muncie, Indiana FIRST MERCHANTS CORPORATION ANNOUNCES FIRST QUARTER EARNINGS PER SHARE OF $.35 First Merchants Corporation (NASDAQ - FRME) has reported first quarter diluted earnings per share totaling $.35, a 4.6 percent decrease over $.37 recorded in the first quarter of 2004. Net income during the period totaled $6.6 million compared to $6.9 million in 2004. Quarterly net interest income improved by $1.3 million, or 5.1 percent and non-interest income improved by $830,000, or 10.1 percent. Core operating expenses remained flat compared to the prior quarter. However, as reported in the Corporation's 8-K filing of February 16, 2005, a $1.6 million expense related to the curtailment of the Corporation's defined benefit pension plan resulted in increased operating expenses of $1.7 million. The earnings per share impact of the curtailment expense totaled $.05 per share. The provision for loan losses increased by $1.3 million based on the Corporation's allowance for loan loss methodology. As of March 31, 2005, non-performing loans totaled 71 basis points of average total loans and the allowance for loan losses as a percent of total loans equaled 1.01 percent. Total assets equaled $3.2 billion at quarter-end, an increase of $162 million, or 5.4 percent from March 31, 2004. Loans, investments and bank owned life insurance, the Corporation's three primary earning assets, totaled $2.9 billion, an increase of $129 million over the prior year. On January 1, 2005, the Corporation combined Randolph County Bank and Union County National Bank and renamed the combined entity United Communities National Bank. The data conversions are complete and the related expenses are reflected in first quarter results. Michael L. Cox, President and Chief Executive Officer, stated that, "Management was pleased with core earnings before the increased provision expense and the curtailment expense approximating $.10 per share. To have the burden of a volatile defined benefit pension plan behind us and our allowance for loan losses equal to 1.01 percent of loans positions our earnings well for the remainder of the year." CONFERENCE CALL First Merchants Corporation will conduct a conference call at 2:30 p.m. Eastern Standard Time/3:30 p.m. Eastern Daylight Time on Wednesday, April 20, 2005. To participate dial (Toll Free) 877-407-9210 and reference First Merchants Corporation's first quarter earnings release. A replay will be available until April 27, 2005. To access, US/Canada participants should dial (Toll Free) 877-660-6853 or for International participants, dial 201-612-7415. The replay will require the Account # 286 and Conference ID # 148455. During the call we may make Forward Looking statements about our relative business outlook. These Forward Looking statements and all other statements made during the call that do not concern historical facts are subject to risks and uncertainties that may materially affect actual results. Specific Forward Looking statements include but are not limited to any indications regarding the Financial Services industry, the economy and future growth of the balance sheet or income statement. Detailed financial results are reported on the attached pages. First Merchants Corporation is a financial holding company headquartered in Muncie, Indiana. Subsidiaries of the Corporation include First Merchants Bank, NA, Madison Community Bank, First United Bank, United Communities National Bank, First National Bank, Decatur Bank & Trust Company, Frances Slocum Bank, Lafayette Bank & Trust Company, Commerce National Bank and Merchants Trust Company. The Corporation also operates First Merchants Insurance Services, a full-service property casualty, personal lines, and healthcare insurance agency, headquartered in Muncie, Indiana, and is a majority member of Indiana Title Insurance Company, LLC, a title insurance agency. First Merchants Corporation's common stock is traded over-the-counter on the NASDAQ National 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). * * * *
CONSOLIDATED BALANCE SHEETS (in thousands) March 31, 2005 2004 Assets Cash and due from banks $ 67,904 $ 60,366 Federal funds sold 22,075 0 ----------- ----------- Cash and cash equivalents 89,979 60,366 Interest-bearing time deposits 10,737 10,674 Investment securities 409,820 376,974 Mortgage loans held for sale 3,084 3,883 Loans 2,414,099 2,320,103 Less: Allowance for loan losses (24,488) (26,459) ----------- ----------- Net loans 2,389,611 2,293,644 Premises and equipment 37,525 38,972 Federal Reserve and Federal Home Loan Bank stock 22,883 21,956 Interest receivable 16,606 15,061 Core deposit intangibles and goodwill 140,578 141,867 Cash surrender value of life insurance 42,426 40,843 Other assets 24,337 20,901 ----------- ----------- Total assets $ 3,187,586 $ 3,025,141 =========== =========== Liabilities Deposits Noninterest-bearing $ 333,614 $ 303,694 Interest-bearing 2,118,605 2,009,726 ----------- ----------- Total deposits 2,452,219 2,313,420 Borrowings 391,193 372,356 Interest payable 6,562 4,542 Other liabilities 27,014 25,676 ----------- ----------- Total liabilities 2,876,988 2,715,994 Stockholders' equity Preferred stock, no-par value Authorized and unissued -- 500,000 shares Common stock, $.125 stated value Authorized -- 50,000,000 shares Issued and outstanding -- 18,497,462 and 18,532,769 shares 2,312 2,317 Additional paid-in capital 148,347 150,679 Retained earnings 163,761 151,771 Accumulated other comprehensive income (3,822) 4,380 ----------- ----------- Total stockholders' equity 310,598 309,147 ----------- ----------- Total liabilities and stockholders' equity $ 3,187,586 $ 3,025,141 =========== ===========
FINANCIAL HIGHLIGHTS Three Months Ended (In thousands) March 31, 2005 2004 NET CHARGE OFF'S $ 727 $ 406 AVERAGE BALANCES Total Assets $3,163,548 $3,041,837 Total Loans 2,414,050 2,339,080 Total Deposits 2,418,910 2,312,708 Total Stockholders' Equity 315,326 306,592 FINANCIAL RATIOS Return on Average Assets .83% .91% Return on Avg. Stockholders' Equity 8.33 9.05 Avg. Earning Assets to Avg. Assets 90.61 90.05 Allowance for Loan Losses as % Of Total Loans 1.01 1.14 Net Charge Off's as % Of Avg. Loans (Annualized) .12 .07 Dividend Payout Ratio 65.71 62.16 Avg. Stockholders' Equity to Avg. Assets 9.97 10.08 Tax Equivalent Yield on Earning Assets 5.90 5.71 Cost of Supporting Liabilities 2.01 1.84 Net Int. Margin (FTE) on Earning Assets 3.89 3.87
CONSOLIDATED STATEMENTS OF INCOME (in thousands, except share data) Three Months Ended March 31, 2005 2004 Interest income Loans receivable Taxable $ 36,822 $ 34,227 Tax exempt 134 163 Investment securities Taxable 2,329 1,949 Tax exempt 1,553 1,430 Federal funds sold 27 18 Deposits with financial institutions 142 109 Federal Reserve and Federal Home Loan Bank stock 308 328 -------- -------- Total interest income 41,315 38,224 -------- -------- Interest expense Deposits 9,806 8,190 Securities sold under repurchase agreements 249 220 Federal Home Loan Bank advances 2,375 2,442 Subordinated debentures, revolving credit and term loans 1,789 1,234 Other borrowings 154 506 -------- -------- Total interest expense 14,373 12,592 -------- -------- Net interest income 26,942 25,632 Provision for loan losses 2,667 1,372 -------- -------- Net interest income after provision for loan losses 24,275 24,260 -------- -------- Other income Fiduciary activities 1,962 1,810 Service charges on deposit accounts 2,723 2,772 Other customer fees 1,085 1,070 Net realized gains on sales of available-for-sale securities 37 Commission income 1,504 953 Earnings on cash surrender value of life insurance 401 429 Net gains and fees on sales of loans 677 801 Other income 694 344 -------- -------- Total other income 9,046 8,216 -------- -------- Other expenses Salaries and employee benefits 14,821 13,024 Net occupancy expenses 1,376 1,254 Equipment expenses 1,857 1,979 Marketing expense 415 440 Outside data processing fees 1,009 1,223 Printing and office supplies 337 398 Goodwill and core deposit amortization 787 892 Other expenses 3,629 3,354 -------- -------- Total other expenses 24,231 22,564 -------- -------- Income before income tax 9,090 9,912 Income tax expense 2,523 2,977 -------- -------- Net income $ 6,567 $ 6,935 ======== ======== Per Share Data Basic Net Income .35 .37 Diluted Net Income .35 .37 Cash Dividends Paid .23 .23 Average Diluted Shares Outstanding (in thousands) 18,697 18,646
CONSOLIDATED BALANCE SHEETS (in thousands) March 31, December 31, September 30, June 30, March 31, 2005 2004 2004 2004 2004 Assets Cash and due from banks $ 67,904 $ 69,960 $ 73,367 $ 72,432 $ 60,366 Federal funds sold 22,075 22,700 ----------- ----------- ----------- ----------- ----------- Cash and cash equivalents 89,979 69,960 96,067 72,432 60,366 Interest-bearing time deposits 10,737 9,343 12,204 20,424 10,674 Investment securities 409,820 421,535 420,645 411,140 376,974 Mortgage loans held for sale 3,084 3,367 2,715 4,001 3,883 Loans 2,414,099 2,428,051 2,395,306 2,365,380 2,320,103 Less: Allowance for loan losses (24,488) (22,548) (25,243) (25,510) (26,459) ----------- ----------- ----------- ----------- ----------- Net loans 2,389,611 2,405,503 2,370,063 2,339,870 2,293,644 Premises and equipment 37,525 38,254 38,170 38,437 38,972 Federal Reserve and Federal Home Loan Bank stock 22,883 22,858 22,750 22,494 21,956 Interest receivable 16,606 17,318 17,594 14,943 15,061 Core deposit intangibles and goodwill 140,578 141,284 140,186 141,014 141,867 Cash surrender value of life insurance 42,426 42,061 41,700 41,288 40,843 Other assets 24,337 20,185 19,268 22,247 20,901 ----------- ----------- ----------- ----------- ----------- Total assets $ 3,187,586 $ 3,191,668 $ 3,181,362 $ 3,128,290 $ 3,025,041 =========== =========== =========== =========== =========== Liabilities Deposits Noninterest-bearing $ 333,614 $ 330,685 $ 373,548 $ 334,018 $ 303,694 Interest-bearing 2,118,605 2,077,465 2,083,271 2,038,092 2,009,726 ----------- ----------- ----------- ----------- ----------- Total deposits 2,452,219 2,408,150 2,456,819 2,372,110 2,313,420 Borrowings 391,193 440,891 379,922 422,885 372,356 Interest payable 6,562 4,411 5,706 4,216 4,542 Other liabilities 27,014 23,613 25,253 24,811 25,676 ----------- ----------- ----------- ----------- ----------- Total liabilities 2,876,988 2,877,065 2,867,700 2,824,022 2,715,994 Stockholders' equity Preferred stock, no-par value Authorized and unissued -- 500,000 shares Common stock, $.125 stated value Authorized -- 50,000,000 shares Issued and outstanding 2,312 2,322 2,320 2,310 2,317 Additional paid-in capital 148,347 150,862 148,993 149,194 150,679 Retained earnings 163,761 161,459 160,004 154,876 151,771 Accumulated other comprehensive income (loss) (3,822) (40) 2,345 (2,112) 4,380 ----------- ----------- ----------- ----------- ----------- Total stockholders' equity 310,598 314,603 313,662 304,268 309,147 ----------- ----------- ----------- ----------- ----------- Total liabilities and stockholders' equity $ 3,187,586 $ 3,191,668 $ 3,181,362 $ 3,128,290 $ 3,025,141 =========== =========== =========== =========== ===========
NON-PERFORMING ASSETS (in thousands) March 31, December 31, September 30, June 30, March 31, 2005 2004 2004 2004 2004 90 days past due $ 1,948 $ 1,907 $ 6,664 $ 2,488 $ 4,770 Non-accrual loans 13,272 15,355 16,852 17,702 19,914 Other real estate 2,003 1,650 1,546 1,653 1,571 ---------- ---------- ---------- ---------- ---------- Total non-performing assets $ 17,223 $ 18,912 $ 25,062 $ 21,843 $ 26,255 ========== ========== ========== ========== ========== Average total loans for the quarter $2,414,050 $2,409,170 $2,383,942 $2,343,270 $2,339,080 Total non-performing assets as a percent of average total loans .71% .79% 1.05% .93% 1.12% Restructured loans $ 337 $ 2,019 $ 2,169 $ 926 $ 957
CONSOLIDATED STATEMENTS OF INCOME Three Months Ended (in thousands, except share data) March 31, December 31, September 30, June 30, March 31, 2005 2004 2004 2004 2004 Interest Income Loans receivable Taxable $ 36,822 $ 36,363 $ 35,342 $ 34,021 $ 34,227 Tax exempt 134 138 143 137 163 Investment securities Taxable 2,329 2,224 2,146 2,052 1,949 Tax exempt 1,553 1,569 1,679 1,420 1,430 Federal funds sold 27 92 18 37 18 Deposits with financial institutions 142 167 154 125 109 Federal Reserve and Federal Home Loan Bank stock 308 297 319 307 328 -------- -------- -------- -------- -------- Total interest income 41,315 40,850 39,801 38,099 38,224 -------- -------- -------- -------- -------- Interest expense Deposits 9,806 9,288 8,487 7,879 8,190 Securities sold under repurchase agreements 249 183 16 98 220 Federal Home Loan Bank advances 2,375 2,418 2,484 2,433 2,442 Subordinated debentures, revolving credit and term loans 1,789 1,717 1,822 1,635 1,610 Other borrowings 154 126 200 207 130 -------- -------- -------- -------- -------- Total interest expense 14,373 13,732 13,009 12,252 12,592 -------- -------- -------- -------- -------- Net interest income 26,942 27,118 26,792 25,847 25,632 Provision for loan losses 2,667 1,233 1,380 1,720 1,372 -------- -------- -------- -------- -------- Net interest income after provision for loan losses 24,275 25,885 25,412 24,127 24,260 -------- -------- -------- -------- -------- Other income Fiduciary activities 1,962 1,897 1,923 2,002 1,810 Service charges on deposit accounts 2,723 2,924 2,946 2,996 2,772 Other customer fees 1,085 1,068 979 966 1,070 Net realized gains on sales of available-for-sale securities 456 332 363 37 Commission income 1,504 671 687 777 953 Earnings on cash surrender value of life insurance 401 439 448 482 429 Net gains and fees on sales of loans 677 801 675 1,352 801 Other income 694 415 421 318 344 -------- -------- -------- -------- -------- Total other income 9,046 8,671 8,411 9,256 8,216 -------- -------- -------- -------- -------- Other expenses Salaries and employee benefits 14,821 13,309 13,087 13,059 13,024 Net occupancy expenses 1,376 1,328 1,391 1,335 1,254 Equipment expenses 1,857 1,879 1,853 1,954 1,979 Marketing expense 415 521 363 385 440 Outside data processing fees 1,009 1,158 1,328 1,211 1,223 Printing and office supplies 337 397 397 388 398 Goodwill and core deposit amortization 787 802 827 852 892 Other expenses 3,629 4,272 3,544 3,438 3,354 -------- -------- -------- -------- -------- Total other expenses 24,231 23,666 22,790 22,622 22,564 -------- -------- -------- -------- -------- Income before income tax 9,090 10,890 11,033 10,761 9,912 Income tax expense 2,523 3,422 3,380 3,406 2,977 -------- -------- -------- -------- -------- Net income $ 6,567 $ 7,468 $ 7,653 $ 7,355 $ 6,935 ======== ======== ======== ======== ======== Per Share Data Basic Net Income $ .35 $ .41 $ .41 $ .40 $ .37 Diluted Net Income .35 .40 .41 .40 .37 Cash Dividends Paid .23 .23 .23 .23 .23 Average Diluted Shares Outstanding (in thousands) 18,697 18,721 18,658 18,633 18,646 FINANCIAL RATIOS Return on Average Assets .83% .94% .98% .96% .91% Return on Avg. Stockholders' Equity 8.33 9.46 9.88 9.56 9.05 Avg. Earning Assets to Avg. Assets 90.61 91.38 89.98 89.64 90.05 Allowance for Loan Losses as % Of Total Loans 1.01 .93 1.05 1.08 1.14 Net Charge Off's as % Of Avg. Loans (Annualized) .12 .65 .34 .46 .07 Dividend Payout Ratio 65.71 57.50 56.10 57.50 62.16 Avg. Stockholders' Equity to Avg. Assets 9.97 9.92 9.89 10.00 10.08 Tax Equivalent Yield on Earning Assets 5.90 5.74 5.79 5.65 5.71 Cost of Supporting Liabilities 2.01 1.89 1.85 1.78 1.84 Net Int. Margin (FTE) on Earning Assets 3.89 3.85 3.94 3.87 3.87
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