10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the Quarterly Period Ended June 30, 2023

Commission File Number 001-15877

German American Bancorp, Inc.

(Exact name of registrant as specified in its charter)

Indiana	35-1547518
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

711 Main Street, Jasper, Indiana 47546

(Address of Principal Executive Offices and Zip Code)

Registrant’s telephone number, including area code: (812) 482-1314

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes   x      No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes   x      No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company:

Large accelerated filer x Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): 

Yes   ☐      No x

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, no par value	GABC	Nasdaq Global Select Market

As of August 1, 2023, the registrant had 29,573,243 outstanding shares of Common Stock, no par value.

CAUTION REGARDING FORWARD-LOOKING STATEMENTS AND ASSOCIATED RISKS

Information included in or incorporated by reference in this Quarterly Report on Form 10-Q, our other filings with the Securities and Exchange Commission (the “SEC”) and our press releases or other public statements contains or may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Please refer to the discussions of our forward-looking statements and associated risks in our Annual Report on Form 10-K for the year ended December 31, 2022, in Item 1, “Business - Forward-Looking Statements and Associated Risks” and our discussion of risk factors in Item 1A, “Risk Factors” of that Annual Report on Form 10-K, as updated and supplemented from time to time by our subsequent SEC filings, including by the discussion under the heading “Forward-Looking Statements and Associated Risks” at the conclusion of Item 2 of Part I of this Report (“Management’s Discussion and Analysis of Financial Condition and Results of Operations”), and by the additional risk factors set forth in Part II, Item 1A, “Risk Factors” of this Report.

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INDEX

Glossary of Terms and Acronyms		4
PART I.            FINANCIAL INFORMATION		6
Item 1.	Unaudited Financial Statements	6
	Consolidated Balance Sheets – June 30, 2023 and December 31, 2022	6
	Consolidated Statements of Income – Three Months Ended June 30, 2023 and 2022	7
	Consolidated Statements of Income – Six Months Ended June 30, 2023 and 2022	8
	Consolidated Statements of Comprehensive Income (Loss) – Three and Six Months Ended June 30, 2023 and 2022	9
	Consolidated Statements of Changes in Shareholders’ Equity - Three and Six Months Ended June 30, 2023 and 2022	10
	Consolidated Statements of Cash Flows – Six Months Ended June 30, 2023 and 2022	11
	Notes to Consolidated Financial Statements – June 30, 2023	12
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	43
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	58
Item 4.	Controls and Procedures	60
PART II.           OTHER INFORMATION		61
Item 1.	Legal Proceedings	62
Item 1A.	Risk Factors	62
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	62
Item 3.	Defaults Upon Senior Securities	62
Item 4.	Mine Safety Disclosures	62
Item 5.	Other Information	62
Item 6.	Exhibits	63
SIGNATURES		64

3

GLOSSARY OF TERMS AND ACRONYMS

As used in this Report, references to “Company,” “we,” “our,” “us,” and similar terms refer to German American Bancorp, Inc. and its consolidated subsidiaries as a whole. Occasionally, we will refer to the term “parent company” or “holding company” when we mean to refer to only German American Bancorp, Inc. and the term “Bank” when we mean to refer only to German American Bank, the Company’s bank subsidiary.

The terms and acronyms identified below are used throughout this Report, including the Notes to Consolidated Financial Statements. You may find it helpful to refer to this Glossary as you read this Report.

2019 ESPP:     German American Bancorp, Inc. 2019 Employee Stock Purchase Plan

2019 LTI Plan:     German American Bancorp, Inc. 2019 Long-Term Equity Incentive Plan

ASC:     Accounting Standards Codification

ASU:     Accounting Standards Update

Basel III Rules:    Regulatory capital rules agreed to by the Basel Committee on Banking Supervision, as issued by the FRB and OCC and published in the Federal Register on October 11, 2013

CARES Act:    Coronavirus Aid, Relief and Economic Security Act

CECL:     Current expected credit losses, which are the subject of an accounting standard under GAAP

CET1:     Common Equity Tier 1

CMO:     Collateralized mortgage obligations

COVID-19:    Novel coronavirus disease 2019 declared, in March 2020, by the World Health Organization as a global pandemic and by the President of the United States as a national emergency

CUB:    Citizens Union Bancorp of Shelbyville, Inc., which was acquired by the Company on January 1, 2022

Dodd-Frank Act:     Dodd-Frank Wall Street Reform and Consumer Protection Act

FASB:     Financial Accounting Standards Board

FDIC:     Federal Deposit Insurance Corporation

federal banking

regulators:    The FRB, the OCC, and the FDIC, collectively

FHLB:     Federal Home Loan Bank

FRB:     Board of Governors of the Federal Reserve System

GAAP:    Generally Accepted Accounting Principles in the United States of America

LIBOR:    London Interbank Offered Rate

MBS:     Mortgage-backed securities

NPV:     Net portfolio value

OCC:     Office of the Comptroller of the Currency

PCD:     Purchased with credit deterioration

4

PPP:    Paycheck Protection Program established under the CARES Act

SEC:    Securities and Exchange Commission

SOFR:    Secured Overnight Funding Rate recommended as an alternative to LIBOR by the Alternative Reference Rate Committee, a U.S.-based group convened by the FRB and the Federal Reserve Bank of New York

5

PART  I.         FINANCIAL INFORMATION

Item 1.           Unaudited Financial Statements

GERMAN AMERICAN BANCORP, INC.

CONSOLIDATED BALANCE SHEETS

(unaudited, dollars in thousands except share and per share data)

	June 30, 2023		December 31, 2022
ASSETS
Cash and Due from Banks	$	78,223	$	77,174
Federal Funds Sold and Other Short-term Investments	62,448		41,905
Cash and Cash Equivalents	140,671		119,079
Interest-bearing Time Deposits with Banks	500		500
Securities Available-for-Sale, at Fair Value (Amortized Cost $1,915,401 for June 30, 2023; Amortized Cost $2,094,826 for December 31, 2022; No Allowance for Credit Losses)	1,600,709		1,761,669
Other Investments	353		353
Loans Held-for-Sale, at Fair Value	8,239		8,600
Loans	3,830,481		3,788,645
Less: Unearned Income	(4,472)		(3,711)
Allowance for Credit Losses	(44,266)		(44,168)
Loans, Net	3,781,743		3,740,766
Stock in FHLB of Indianapolis and Other Restricted Stock, at Cost	14,856		15,037
Premises, Furniture and Equipment, Net	112,629		112,237
Other Real Estate	—		—
Goodwill	180,357		180,357
Intangible Assets	7,773		9,426
Company Owned Life Insurance	84,926		83,998
Accrued Interest Receivable and Other Assets	120,513		123,969
TOTAL ASSETS	$	6,053,269	$	6,155,991
LIABILITIES
Non-interest-bearing Demand Deposits	$	1,540,564	$	1,691,804
Interest-bearing Demand, Savings, and Money Market Accounts	3,056,396		3,229,778
Time Deposits	582,745		428,469
Total Deposits	5,179,705		5,350,051
FHLB Advances and Other Borrowings	227,484		203,806
Accrued Interest Payable and Other Liabilities	43,515		43,741
TOTAL LIABILITIES	5,450,704		5,597,598
SHAREHOLDERS’ EQUITY
Common Stock, no par value, $1 stated value; 45,000,000 shares authorized	29,573		29,493
Additional Paid-in Capital	388,460		387,171
Retained Earnings	433,384		405,167
Accumulated Other Comprehensive Income (Loss)	(248,852)		(263,438)
TOTAL SHAREHOLDERS’ EQUITY	602,565		558,393
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	6,053,269	$	6,155,991
End of period shares issued and outstanding	29,572,783		29,493,193

See accompanying notes to consolidated financial statements.

6

GERMAN AMERICAN BANCORP, INC.

CONSOLIDATED STATEMENTS OF INCOME

(unaudited, dollars in thousands except per share data)

	Three Months Ended  June 30,
	2023		2022
INTEREST INCOME
Interest and Fees on Loans	$	52,202	$	39,987
Interest on Federal Funds Sold and Other Short-term Investments	660		1,232
Interest and Dividends on Securities:
Taxable	5,223		5,113
Non-taxable	5,429		5,934
TOTAL INTEREST INCOME	63,514		52,266
INTEREST EXPENSE
Interest on Deposits	13,357		1,549
Interest on FHLB Advances and Other Borrowings	1,899		1,120
TOTAL INTEREST EXPENSE	15,256		2,669
NET INTEREST INCOME	48,258		49,597
Provision for Credit Losses	550		300
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES	47,708		49,297
NON-INTEREST INCOME
Wealth Management Fees	2,912		2,642
Service Charges on Deposit Accounts	2,883		2,871
Insurance Revenues	2,130		2,254
Company Owned Life Insurance	429		894
Interchange Fee Income	4,412		4,167
Other Operating Income	1,462		1,225
Net Gains on Sales of Loans	630		1,049
Net Gains on Securities	38		78
TOTAL NON-INTEREST INCOME	14,896		15,180
NON-INTEREST EXPENSE
Salaries and Employee Benefits	20,103		20,384
Occupancy Expense	2,547		2,803
Furniture and Equipment Expense	896		969
FDIC Premiums	687		465
Data Processing Fees	2,803		2,460
Professional Fees	1,614		1,573
Advertising and Promotion	1,261		1,027
Intangible Amortization	734		957
Other Operating Expenses	5,081		5,063
TOTAL NON-INTEREST EXPENSE	35,726		35,701
Income before Income Taxes	26,878		28,776
Income Tax Expense	4,755		5,029
NET INCOME	$	22,123	$	23,747
Basic Earnings per Share	$	0.75	$	0.81
Diluted Earnings per Share	$	0.75	$	0.81

See accompanying notes to consolidated financial statements.

7

GERMAN AMERICAN BANCORP, INC.

CONSOLIDATED STATEMENTS OF INCOME

(unaudited, dollars in thousands except per share data)

	Six Months Ended June 30,
	2023		2022
INTEREST INCOME
Interest and Fees on Loans	$	101,263	$	78,922
Interest on Federal Funds Sold and Other Short-term Investments	1,005		1,512
Interest and Dividends on Securities:
Taxable	10,619		9,633
Non-taxable	11,116		11,474
TOTAL INTEREST INCOME	124,003		101,541
INTEREST EXPENSE
Interest on Deposits	22,328		2,878
Interest on FHLB Advances and Other Borrowings	4,408		2,158
TOTAL INTEREST EXPENSE	26,736		5,036
NET INTEREST INCOME	97,267		96,505
Provision for Credit Losses	1,650		5,500
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES	95,617		91,005
NON-INTEREST INCOME
Wealth Management Fees	5,556		5,280
Service Charges on Deposit Accounts	5,671		5,554
Insurance Revenues	5,265		5,975
Company Owned Life Insurance	830		1,352
Interchange Fee Income	8,611		7,794
Other Operating Income	2,673		2,493
Net Gains on Sales of Loans	1,217		2,470
Net Gains on Securities	40		450
TOTAL NON-INTEREST INCOME	29,863		31,368
NON-INTEREST EXPENSE
Salaries and Employee Benefits	41,949		43,472
Occupancy Expense	5,457		5,682
Furniture and Equipment Expense	1,806		1,899
FDIC Premiums	1,428		941
Data Processing Fees	5,558		10,184
Professional Fees	3,176		3,936
Advertising and Promotion	2,428		2,165
Intangible Amortization	1,519		1,974
Other Operating Expenses	10,021		13,608
TOTAL NON-INTEREST EXPENSE	73,342		83,861
Income before Income Taxes	52,138		38,512
Income Tax Expense	9,208		5,698
NET INCOME	$	42,930	$	32,814
Basic Earnings per Share	$	1.45	$	1.11
Diluted Earnings per Share	$	1.45	$	1.11

See accompanying notes to consolidated financial statements.

8

GERMAN AMERICAN BANCORP, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(unaudited, dollars in thousands)

	Three Months Ended  June 30,
	2023		2022
NET INCOME	$	22,123	$	23,747
Other Comprehensive Income (Loss):
Unrealized Gains (Losses) on Securities:
Unrealized Holding Gain (Loss) Arising During the Period	(23,243)		(117,357)
Reclassification Adjustment for Gains Included in Net Income	(38)		(78)
Tax Effect	4,921		24,741
Net of Tax	(18,360)		(92,694)
Total Other Comprehensive Income (Loss)	(18,360)		(92,694)
COMPREHENSIVE INCOME (LOSS)	$	3,763	$	(68,947)

	Six Months Ended  June 30,
	2023		2022
NET INCOME	$	42,930	$	32,814
Other Comprehensive Income (Loss):
Unrealized Gains (Losses) on Securities:
Unrealized Holding Gain (Loss) Arising During the Period	18,506		(286,698)
Reclassification Adjustment for Gains Included in Net Income	(40)		(450)
Tax Effect	(3,880)		60,569
Net of Tax	14,586		(226,579)
Total Other Comprehensive Income (Loss)	14,586		(226,579)
COMPREHENSIVE INCOME (LOSS)	$	57,516	$	(193,765)

See accompanying notes to consolidated financial statements.

9

GERMAN AMERICAN BANCORP, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(unaudited, dollars in thousands)

	Common Stock
	Shares	Amount		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total Shareholders' Equity
Balances, January 1, 2023	29,493,193	$	29,493	$	387,171	$	405,167	$	(263,438)	$	558,393
Net Income	—	—		—		20,807		—		20,807
Other Comprehensive Income (Loss)	—	—		—		—		32,946		32,946
Cash Dividends ($0.25 per share)	—	—		—		(7,354)		—		(7,354)
Issuance of Common Stock for:
Restricted Share Grants Net	80,246	80		459		—		—		539
Balances, March 31, 2023	29,573,439	$	29,573	$	387,630	$	418,620	$	(230,492)	$	605,331
Net Income	—	—		—		22,123		—		22,123
Other Comprehensive Income (Loss)	—	—		—		—		(18,360)		(18,360)
Cash Dividends ($0.25 per share)	—	—		—		(7,359)		—		(7,359)
Issuance of Common Stock for:
Restricted Share Grants Net	(656)	—		830		—		—		830
Balances, June 30, 2023	29,572,783	$	29,573	$	388,460	$	433,384	$	(248,852)	$	602,565

	Common Stock
	Shares	Amount		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total Shareholders' Equity
Balances, January 1, 2022	26,553,508	$	26,554	$	276,057	$	350,364	$	15,484	$	668,459
Net Income	—	—		—		9,067		—		9,067
Other Comprehensive Income (Loss)	—	—		—		—		(133,885)		(133,885)
Cash Dividends ($0.23 per share)	—	—		—		(6,752)		—		(6,752)
Issuance of Common Stock for:
Acquisition of Citizens Union Bancorp of Shelbyville, Inc., net	2,870,975	2,871		108,852		—		—		111,723
Restricted Share Grants Net	61,200	61		363		—		—		424
Balances, March 31, 2022	29,485,683	$	29,486	$	385,272	$	352,679	$	(118,401)	$	649,036
Net Income	—	—		—		23,747		—		23,747
Other Comprehensive Income (Loss)	—	—		—		—		(92,694)		(92,694)
Cash Dividends ($0.23 per share)	—	—		—		(6,753)		—		(6,753)
Issuance of Common Stock for:
Restricted Share Grants Net	(2,638)	(3)		1,096		—		—		1,093
Balances, June 30, 2022	29,483,045	$	29,483	$	386,368	$	369,673	$	(211,095)	$	574,429

See accompanying notes to consolidated financial statements.

10

GERMAN AMERICAN BANCORP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited, dollars in thousands)

	Six Months Ended  June 30,
	2023		2022
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income	$	42,930	$	32,814
Adjustments to Reconcile Net Income to Net Cash from Operating Activities:
Net Amortization on Securities	2,779		3,341
Depreciation and Amortization	4,840		5,250
Loans Originated for Sale	(48,256)		(98,293)
Proceeds from Sales of Loans Held-for-Sale	49,744		104,858
Provision for Credit Losses	1,650		5,500
Gain on Sale of Loans, net	(1,217)		(2,470)
Gain on Securities, net	(40)		(450)
Gain on Sales of Other Real Estate and Repossessed Assets	—		(19)
Gain on Disposition and Donation of Premises and Equipment	2		(28)
Increase in Cash Surrender Value of Company Owned Life Insurance	(928)		(908)
Equity Based Compensation	1,369		1,517
Change in Assets and Liabilities:
Interest Receivable and Other Assets	601		6,508
Interest Payable and Other Liabilities	(233)		(7,299)
Net Cash from Operating Activities	53,241		50,321
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from Maturities of Securities Available-for-Sale	145,360		73,320
Proceeds from Sales of Securities Available-for-Sale	114,259		97,500
Purchase of Securities Available-for-Sale	(82,933)		(290,743)
Proceeds from Redemption of Federal Home Loan Bank Stock	181		7,867
Purchase of Loans	(173)		(1,063)
Proceeds from Sale of Loans Held for Investment	—		609
Loans Made to Customers, net of Payments Received	(42,454)		33,504
Proceeds from Sales of Other Real Estate	—		89
Property and Equipment Expenditures	(4,464)		(5,211)
Proceeds from Life Insurance	—		773
Acquisition of Citizens Union Bancorp of Shelbyville, Inc.	—		207,764
Net Cash from Investing Activities	129,776		124,409
CASH FLOWS FROM FINANCING ACTIVITIES
Change in Deposits	(170,162)		38,496
Change in Short-term Borrowings	(1,487)		(28,934)
Advances in Long-term Debt	25,000		—
Repayments of Long-term Debt	(63)		(41,632)
Dividends Paid	(14,713)		(13,505)
Net Cash from Financing Activities	(161,425)		(45,575)
Net Change in Cash and Cash Equivalents	21,592		129,155
Cash and Cash Equivalents at Beginning of Year	119,079		396,890
Cash and Cash Equivalents at End of Period	$	140,671	$	526,045

Cash Paid During the Period for
Interest	$	24,353	$	4,831
Income Taxes	9,736		8,312
Supplemental Non Cash Disclosures
Interest Rate Swap Fair Value Adjustment	$	(637)	$	1,055
Supplemental Schedule for Investing Activities (Acquisition of CUB)
Assets acquired, net of purchase consideration	$	—	$	945,160
Liabilities assumed	—		1,003,756
Goodwill	$	—	$	58,596

See accompanying notes to consolidated financial statements.

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GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 1 – Basis of Presentation and Market Conditions

German American Bancorp, Inc. operates primarily in the banking industry. The accounting and reporting policies of German American Bancorp, Inc. and its subsidiaries (hereinafter collectively referred to as the "Company") conform to U.S. generally accepted accounting principles. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted. All adjustments which are, in the opinion of management, necessary for a fair presentation of the results for the periods reported have been included in the accompanying unaudited consolidated financial statements, and all such adjustments are of a normal recurring nature. It is suggested that these consolidated financial statements and notes be read in conjunction with the financial statements and notes thereto in the Company's Annual Report on Form 10-K for the year ended December 31, 2022. Certain items included in the prior period financial statements were reclassified to conform to the current presentation. There was no effect on net income or total shareholders' equity based on these reclassifications.

NOTE 2 - Recent Accounting Pronouncements

Recently Adopted Accounting Guidance

In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting”. These amendments provide temporary optional guidance to ease the potential burden in accounting for reference rate reform. The ASU provides optional expedients and exceptions for applying generally accepted accounting principles to contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued. It is intended to help stakeholders during the global market-wide reference rate transition period. In January 2021, the FASB issued ASU 2021-01 which clarifies that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The guidance is effective for all entities as of March 12, 2020 through December 31, 2024. The Company has discontinued originating LIBOR based loans and has a plan in place to transition LIBOR indexed loans primarily to term SOFR or other indices.

On March 31, 2022, the FASB issued ASU 2022-02, “Financial Instruments - Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures” which eliminates the troubled debt restructuring recognition and measurement guidance and instead requires an entity to evaluate whether the modification represents a new loan or a continuation of an existing loan. The amendments also enhance existing disclosures and include new disclosure requirements related to certain modifications of receivables made to borrowers experiencing financial difficulty. To improve consistency for vintage disclosures, the ASU requires that public business entities disclose current-period gross write-offs by year of origination for financing receivables and net investments in leases within the scope of Subtopic 326-20. For entities that have adopted ASU 2016-13, the amendments are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. For entities that have not adopted ASU 2016-13, the effective dates for the amendments are the same as the effective dates in ASU 2016-13. Early adoption is permitted if ASU 2016-13 has been adopted, including adoption in an interim period. If an entity elects to adopt the amendments in an interim period, the guidance should be applied as of the beginning of the fiscal year that includes the interim period. The Company adopted the new guidance prospectively with no material impact to the consolidated financial statements.

The SEC released Staff Accounting Bulletin No. 121 (“SAB 121”) on March 31, 2022, which provides interpretive guidance regarding the accounting for obligations to safeguard crypto-assets an entity holds for its customers, either directly, through an agent or through another third party acting on its behalf. SAB 121 requires an entity to recognize a liability on its balance sheet to reflect the obligation to safeguard the crypto-assets of others, along with a corresponding safeguarding asset, both of which are measured at fair value. The Company has completed an evaluation and concluded that it does not have a safeguarding obligation under SAB 121 and therefore the disclosures do not apply.

Newly Issued But Not Yet Effective Accounting Standards

On March 29, 2023, the FASB issued ASU 2023-02, "Investments - Equity Method and Joint Ventures (Topic 323): Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method" to expand use of the proportional amortization method of accounting to equity investments in tax credit programs beyond those in low-income-housing tax credit (LIHTC) programs. The amendments in this update permit reporting entities to account for certain tax equity

12

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 2 - Recent Accounting Pronouncements (continued)

investments, regardless of the tax credit program from which the income tax credits are received, using the proportional amortization method if certain conditions are met. This guidance provides clarifications to address interpretive issues and prescribes specific information that reporting entities must disclose about tax credit investments each period.

This ASU is effective for reporting periods beginning after December 15, 2023, for public business entities. For all other entities, the ASU is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted, included early adoption in any interim period as of the beginning of the fiscal year that includes that interim period. Entities have the option of applying the forthcoming revisions using either a modified retrospective or retrospective adoption approach. The Company is currently evaluating the impact of adopting this new guidance, however, adoption of the standard is not expected to have a material impact on the Company's financial statements or disclosures.

NOTE 3 – Per Share Data

The computation of Basic Earnings per Share and Diluted Earnings per Share are as follows:

	Three Months Ended  June 30,
	2023		2022
Basic Earnings per Share:
Net Income	$	22,123	$	23,747
Weighted Average Shares Outstanding	29,573,042		29,483,848
Basic Earnings per Share	$	0.75	$	0.81
Diluted Earnings per Share:
Net Income	$	22,123	$	23,747
Weighted Average Shares Outstanding	29,573,042		29,483,848
Potentially Dilutive Shares, Net	—		—
Diluted Weighted Average Shares Outstanding	29,573,042		29,483,848
Diluted Earnings per Share	$	0.75	$	0.81

For the three months ended June 30, 2023 and 2022, there were no anti-dilutive shares.

	Six Months Ended  June 30,
	2023		2022
Basic Earnings per Share:
Net Income	$	42,930	$	32,814
Weighted Average Shares Outstanding	29,540,425		29,443,673
Basic Earnings per Share	$	1.45	$	1.11
Diluted Earnings per Share:
Net Income	$	42,930	$	32,814
Weighted Average Shares Outstanding	29,540,425		29,443,673
Potentially Dilutive Shares, Net	—		—
Diluted Weighted Average Shares Outstanding	29,540,425		29,443,673
Diluted Earnings per Share	$	1.45	$	1.11

For the six months ended June 30, 2023 and 2022, there were no anti-dilutive shares.

13

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 4 – Securities 

The amortized cost, unrealized gross gains and losses recognized in accumulated other comprehensive income (loss), and fair value of securities available-for-sale were as follows:

Securities Available-for-Sale:	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value
June 30, 2023
U.S. Treasury	$	999	$	1	$	—	$	—	$	1,000
Obligations of State and Political Subdivisions	894,264		487		(147,445)		—		747,306
MBS/CMO	793,915		—		(128,046)		—		665,869
US Gov’t Sponsored Entities & Agencies	226,223		—		(39,689)		—		186,534
Total	$	1,915,401	$	488	$	(315,180)	$	—	$	1,600,709
December 31, 2022
U.S. Treasury	$	64,097	$	22	$	—	$	—	$	64,119
Obligations of State and Political Subdivisions	939,193		673		(162,014)		—		777,852
MBS/CMO	846,519		—		(131,838)		—		714,681
US Gov’t Sponsored Entities & Agencies	245,017		—		(40,000)		—		205,017
Total	$	2,094,826	$	695	$	(333,852)	$	—	$	1,761,669

All mortgage-backed securities in the above table (identified above and throughout this Note 4 as "MBS/CMO") are residential and multi-family mortgage-backed securities and guaranteed by government sponsored entities. The US Gov’t Sponsored Entities & Agencies in the above table include securities that have underlying collateral of equipment, machinery and commercial real estate.

The amortized cost and fair value of securities available-for-sale at June 30, 2023 by contractual maturity are shown below. Expected maturities may differ from contractual maturities because some issuers have the right to call or prepay certain obligations with or without call or prepayment penalties. Mortgage-backed Securities are not due at a single maturity date and are shown separately.

Securities Available-for-Sale:	Amortized Cost		Fair Value
Due in one year or less	$	2,964	$	2,963
Due after one year through five years	15,119		15,106
Due after five years through ten years	53,731		51,246
Due after ten years	823,449		678,991
MBS/CMO	793,915		665,869
US Gov’t Sponsored Entities & Agencies	226,223		186,534
Total	$	1,915,401	$	1,600,709

Proceeds from the Sales of Securities are summarized below:

	Three Months Ended		Three Months Ended
	June 30, 2023		June 30, 2022
Proceeds from Sales	$	20,507	$	5,554
Gross Gains on Sales	38		78
Income Taxes on Gross Gains	8		16

14

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 4 - Securities (continued)

	Six Months Ended		Six Months Ended
	June 30, 2023		June 30, 2022
Proceeds from Sales	$	114,259	$	97,500
Gross Gains on Sales	40		450
Income Taxes on Gross Gains	8		94

The carrying value of securities pledged to secure repurchase agreements, public and trust deposits, and for other purposes as required by law was $374,291 and $354,123 as of June 30, 2023 and December 31, 2022, respectively.

Below is a summary of securities with unrealized losses as of June 30, 2023 and December 31, 2022, presented by length of time the securities have been in a continuous unrealized loss position:

	Less than 12 Months				12 Months or More				Total
June 30, 2023	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
U.S. Treasury	$	—	$	—	$	—	$	—	$	—	$	—
Obligations of State and Political Subdivisions	59,277		(688)		646,205		(146,757)		705,482		(147,445)
MBS/CMO	23,202		(1,315)		642,660		(126,731)		665,862		(128,046)
US Gov’t Sponsored Entities & Agencies	—		—		186,534		(39,689)		186,534		(39,689)
Total	$	82,479	$	(2,003)	$	1,475,399	$	(313,177)	$	1,557,878	$	(315,180)

	Less than 12 Months				12 Months or More				Total
December 31, 2022	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
U.S. Treasury	$	—	$	—	$	—	$	—	$	—	$	—
Obligations of State and Political Subdivisions	579,267		(117,423)		122,992		(44,591)		702,259		(162,014)
MBS/CMO	240,344		(20,920)		474,327		(110,918)		714,671		(131,838)
US Gov’t Sponsored Entities & Agencies	198,702		(38,818)		6,314		(1,182)		205,016		(40,000)
Total	$	1,018,313	$	(177,161)	$	603,633	$	(156,691)	$	1,621,946	$	(333,852)

Available-for-sale debt securities in unrealized loss positions are evaluated for impairment related to credit losses at least quarterly. For available-for-sale debt securities in an unrealized loss position, the Company assesses whether we intend to sell, or it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is reduced to fair value through income. For available-for sale debt securities that do not meet the criteria, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, management considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and adverse conditions specifically related to the security and the issuer, among other factors. If this assessment indicates that a credit loss exists, we compare the present value of cash flows expected to be collected from the security with the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis for the security, a credit loss exists and an allowance for credit losses is recorded, limited to the amount that the fair value of the security is less than its amortized cost basis. Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income, net of applicable taxes. The increase in unrealized losses from December 31, 2022 to June 30, 2023 was primarily the result of fair value adjustments caused by the change in market interest rates. There was no allowance for credit losses for available-for-sale debt securities at June 30, 2023 or December 31, 2022.

Although management has the ability to sell these securities if the need arises, their designation as available-for-sale should not necessarily be interpreted as an indication that management anticipates such sales.

Accrued interest receivable on available-for-sale debt securities totaled $9,802 at June 30, 2023 and $10,637 at December 31, 2022. Accrued interest receivable is excluded from the estimate of credit losses.

15

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 4 - Securities (continued)

The Company’s equity securities are listed as Other Investments on the Consolidated Balance Sheets and consist of one non-controlling investment in a single banking organization at June 30, 2023 and December 31, 2022. The original investment totaled $1,350 and other-than-temporary impairment was previously recorded totaling $997. The Company’s equity securities are considered not to have readily determinable fair value and are carried at cost and evaluated for impairment. At June 30, 2023, there was no additional impairment recognized through earnings.

NOTE 5 – Derivatives

The Company executes interest rate swaps with commercial banking customers to facilitate their respective risk management strategies. The notional amounts of these interest rate swaps and the offsetting counterparty derivative instruments were $135,113 at June 30, 2023 and $134,684 at December 31, 2022. These interest rate swaps are simultaneously hedged by offsetting interest rate swaps that the Company executes with a third party, such that the Company minimizes its net risk exposure resulting from such transactions with approved, reputable, independent counterparties with substantially matching terms. The agreements are considered stand-alone derivatives and changes in the fair value of derivatives are reported in earnings as non-interest income. While the derivatives represent economic hedges, they do not qualify as hedges for accounting purposes.  

Credit risk arises from the possible inability of counterparties to meet the terms of their contracts. The Company’s exposure is limited to the replacement value of the contracts rather than the notional, principal or contract amounts. There are provisions in the agreements with the counterparties that allow for certain unsecured credit exposure up to an agreed threshold. Exposures in excess of the agreed thresholds are collateralized. In addition, the Company minimizes credit risk through credit approvals, limits, and monitoring procedures.

The following table reflects the fair value of derivative instruments included in the Consolidated Balance Sheets as of:

	June 30, 2023				December 31, 2022
	Notional Amount		Fair Value		Notional Amount		Fair Value
Included in Other Assets:
Interest Rate Swaps	$	135,113	$	9,183	$	134,684	$	9,899
Included in Other Liabilities:
Interest Rate Swaps	$	135,113	$	9,112	$	134,684	$	9,749

The following table presents the effect of derivative instruments on the Consolidated Statements of Income for the periods presented:

	Three Months Ended  June 30,				Six Months Ended  June 30,
	2023		2022		2023		2022
Interest Rate Swaps:
Included in Other Operating Income	$	227	$	130	$	178	$	344

16

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 6 – Loans

Loans were comprised of the following classifications:

	June 30, 2023		December 31, 2022
Commercial:
Commercial and Industrial Loans	$	608,284	$	620,106
Commercial Real Estate Loans	2,021,109		1,966,884
Agricultural Loans	395,466		417,413
Leases	60,853		56,396
Retail:
Home Equity Loans	284,517		279,748
Consumer Loans	85,595		79,904
Credit Cards	19,328		17,512
Residential Mortgage Loans	355,329		350,682
Subtotal	3,830,481		3,788,645
Less: Unearned Income	(4,472)		(3,711)
Allowance for Credit Losses	(44,266)		(44,168)
Loans, net	$	3,781,743	$	3,740,766

The table above includes $15,779 and $21,149 of purchase credit deteriorated loans as of June 30, 2023 and December 31, 2022, respectively.

Allowance for Credit Losses for Loans

The following tables present the activity in the allowance for credit losses by portfolio segment for the three months ended June 30, 2023 and 2022:

June 30, 2023	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Unallocated		Total
Allowance for Credit Losses:
Beginning balance	$	13,572	$	22,062	$	3,887	$	227	$	609	$	1,415	$	263	$	2,280	$	—	$	44,315
Provision (Benefit) for credit loss expense	244		(233)		94		8		174		45		157		61		—		550
Loans charged-off	(343)		—		(25)		—		(284)		(25)		(141)		(31)		—		(849)
Recoveries collected	94		5		—		—		141		1		9		—		—		250
Total ending allowance balance	$	13,567	$	21,834	$	3,956	$	235	$	640	$	1,436	$	288	$	2,310	$	—	$	44,266

17

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 6 - Loans (continued)

June 30, 2022	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Unallocated		Total
Allowance for Credit Losses:
Beginning balance	$	12,720	$	23,217	$	4,759	$	196	$	616	$	1,207	$	212	$	2,151	$	—	$	45,078
Provision (Benefit) for credit loss expense	874		(873)		(131)		(5)		293		41		73		28		—		300
Loans charged-off	(56)		—		—		—		(322)		(15)		(51)		(3)		—		(447)
Recoveries collected	7		5		—		—		81		—		5		2		—		100
Total ending allowance balance	$	13,545	$	22,349	$	4,628	$	191	$	668	$	1,233	$	239	$	2,178	$	—	$	45,031

The following tables present the activity in the allowance for credit losses by portfolio segment for the six months ended June 30, 2023 and 2022:

June 30, 2023	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Unallocated		Total
Allowance for Credit Losses:
Beginning balance	$	13,749	$	21,598	$	4,188	$	209	$	595	$	1,344	$	257	$	2,228	$	—	$	44,168
Provision (Benefit) for credit loss expense	746		169		(207)		26		399		100		281		136		—		1,650
Loans charged-off	(1,077)		—		(25)		—		(628)		(39)		(261)		(57)		—		(2,087)
Recoveries collected	149		67		—		—		274		31		11		3		—		535
Total ending allowance balance	$	13,567	$	21,834	$	3,956	$	235	$	640	$	1,436	$	288	$	2,310	$	—	$	44,266

June 30, 2022	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Unallocated		Total
Allowance for Credit Losses:
Beginning balance	$	9,554	$	19,245	$	4,505	$	200	$	507	$	1,061	$	240	$	1,705	$	—	$	37,017
Acquisition of Citizens Union Bank of Shelbyville, KY	376		1,945		689		—		2		—		—		105		—		3,117
Provision (Benefit) for credit loss expense	3,662		1,223		(566)		(9)		518		224		79		369		—		5,500
Loans charged-off	(61)		(78)		—		—		(532)		(52)		(90)		(3)		—		(816)
Recoveries collected	14		14		—		—		173		—		10		2		—		213
Total ending allowance balance	$	13,545	$	22,349	$	4,628	$	191	$	668	$	1,233	$	239	$	2,178	$	—	$	45,031

The Company utilizes the Static Pool methodology in determining expected future credit losses. Static pool analysis means segmenting and tracking loans over a period of time based on similar risk characteristics such as loan structure, collateral type, industry of borrower and concentrations, contractual terms and credit risk indicators. Static pool calculates a loss rate on a closed pool of loans that existed on a specified start date based upon the remaining life of each segment.

The Company’s expected loss estimate is anchored in historical credit loss experience, with an emphasis on all available portfolio data. The Company's historical look-back period includes January 2014 through the current period, on a monthly basis.

Qualitative reserves reflect management’s overall estimate of the extent to which current expected credit losses on collectively evaluated loans will differ from historical loss experience. The analysis takes into consideration industry and collateral concentrations, acquired loan portfolio characteristics and other credit-related analytics as deemed appropriate. Management attempts to quantify qualitative reserves by anchoring to specific data points when possible.

18

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 6 - Loans (continued)

The Company estimates the allowance balance using relevant available information, from internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts. Historical loss experience provides the basis for the estimation of expected credit losses. Adjustments to historical loss information are made for changes in underwriting standards, portfolio mix, delinquency level, changes in environmental conditions, unemployment rates, risk classifications and collateral values. The allowance for credit losses is measured on a collective (pooled) basis when similar risk characteristics exist. Based on the potential increased losses related to the advancing stress on the economy as a result of inflationary pressures, rising interest rates and financial market volatility, the Company has considered this loss experience may align with loss experience from the recessionary period from 2008-2011 and qualitative adjustments have been made accordingly.

Loans that do not share risk characteristics are evaluated on an individual basis. Loans evaluated individually are not included in the collective evaluation. When the borrower is experiencing financial difficulty at the reporting date and repayment is expected to be provided substantially through the operation or sale of the collateral, expected credit losses are based on the fair value of the collateral at the reporting date adjusted for selling costs.

For the six months ended June 30, 2023, the allowance for credit losses increased slightly compared to December 31, 2022. The Company saw improvement in individually analyzed loans and added reserve for loan portfolio growth. Key indicators utilized in forecasting for the allowance calculations include unemployment rates and gross domestic product as well as commodity prices for the agricultural segment of the portfolio. There has been some improvement in these factors over previous periods; however, rising interest rates and the expanded inflationary impact on consumer discretionary spending were considered in the qualitative factors to determine the allowance for credit losses.

All classes of loans, including loans acquired with deteriorated credit quality, are generally placed on non-accrual status when scheduled principal or interest payments are past due for 90 days or more or when the borrower’s ability to repay becomes doubtful. For purchased loans, the determination is made at the time of acquisition as well as over the life of the loan. Uncollected accrued interest for each class of loans is reversed against income at the time a loan is placed on non-accrual. Interest received on such loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual. All classes of loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. Loans are typically charged-off at 180 days past due, or earlier if deemed uncollectible. Exceptions to the non-accrual and charge-off policies are made when the loan is well secured and in the process of collection.

The following tables present the amortized cost in non-accrual loans and loans past due over 89 days still accruing by class of loans as of June 30, 2023 and December 31, 2022:

June 30, 2023	Non-Accrual With No Allowance for Credit Loss (1)		Total Non-Accrual		Loans Past Due Over 89 Days Still Accruing
Commercial and Industrial Loans	$	620	$	7,577	$	1,000
Commercial Real Estate Loans	425		1,178		—
Agricultural Loans	906		1,252		—
Leases	—		—		—
Home Equity Loans	449		503		—
Consumer Loans	18		18		—
Credit Cards	119		119		—
Residential Mortgage Loans	431		776		—
Total	$	2,968	$	11,423	$	1,000

(1) Non-accrual loans with no allowance for credit loss and are also included in Total Non-Accrual loans of $11,423.

Interest income on non-accrual loans recognized during the three and six months ended June 30, 2023 totaled $21 and $37, respectively.

19

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 6 - Loans (continued)

December 31, 2022	Non-Accrual With No Allowance for Credit Loss (1)		Total Non-Accrual		Loans Past Due Over 89 Days Still Accruing
Commercial and Industrial Loans	$	1,142	$	7,936	$	1,427
Commercial Real Estate Loans	49		1,950		—
Agricultural Loans	994		1,062		—
Leases	—		—		—
Home Equity Loans	262		310		—
Consumer Loans	240		254		—
Credit Cards	146		146		—
Residential Mortgage Loans	676		1,230		—
Total	$	3,509	$	12,888	$	1,427

(1) Includes non-accrual loans with no allowance for credit loss and are also included in Total Non-Accrual loans of $12,888.

Interest income on non-accrual loans recognized during the year ended December 31, 2022 totaled $32.

The following tables present the amortized cost basis of collateral-dependent loans by class of loans as of June 30, 2023 and December 31, 2022:

June 30, 2023	Real Estate		Equipment		Accounts Receivable		Other		Total
Commercial and Industrial Loans	$	2,005	$	216	$	—	$	6,849	$	9,070
Commercial Real Estate Loans	9,050		35		—		—		9,085
Agricultural Loans	4,160		288		—		—		4,448
Leases	—		—		—		—		—
Home Equity Loans	475		—		—		—		475
Consumer Loans	8		1		—		—		9
Credit Cards	—		—		—		—		—
Residential Mortgage Loans	860		—		—		—		860
Total	$	16,558	$	540	$	—	$	6,849	$	23,947

December 31, 2022	Real Estate		Equipment		Accounts Receivable		Other		Total
Commercial and Industrial Loans	$	2,078	$	1,219	$	272	$	5,851	$	9,420
Commercial Real Estate Loans	12,192		36		—		—		12,228
Agricultural Loans	4,944		318		—		—		5,262
Leases	—		—		—		—		—
Home Equity Loans	467		—		—		—		467
Consumer Loans	8		2		—		12		22
Credit Cards	—		—		—		—		—
Residential Mortgage Loans	1,060		—		—		—		1,060
Total	$	20,749	$	1,575	$	272	$	5,863	$	28,459

20

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 6 - Loans (continued)

The following tables present the aging of the amortized cost basis in past due loans by class of loans as of June 30, 2023 and December 31, 2022:

June 30, 2023	30-59 Days Past Due		60-89 Days Past Due		Greater Than 89 Days Past Due		Total Past Due		Loans Not Past Due		Total
Commercial and Industrial Loans	$	96	$	49	$	8,110	$	8,255	$	600,029	$	608,284
Commercial Real Estate Loans	710		599		1,009		2,318		2,018,791		2,021,109
Agricultural Loans	632		590		780		2,002		393,464		395,466
Leases	—		—		—		—		60,853		60,853
Home Equity Loans	1,163		89		503		1,755		282,762		284,517
Consumer Loans	133		42		17		192		85,403		85,595
Credit Cards	94		22		119		235		19,093		19,328
Residential Mortgage Loans	6,072		966		557		7,595		347,734		355,329
Total	$	8,900	$	2,357	$	11,095	$	22,352	$	3,808,129	$	3,830,481

December 31, 2022	30-59 Days Past Due		60-89 Days Past Due		Greater Than 89 Days Past Due		Total Past Due		Loans Not Past Due		Total
Commercial and Industrial Loans	$	268	$	681	$	8,285	$	9,234	$	610,872	$	620,106
Commercial Real Estate Loans	1,617		14		616		2,247		1,964,637		1,966,884
Agricultural Loans	343		—		123		466		416,947		417,413
Leases	—		—		—		—		56,396		56,396
Home Equity Loans	1,770		140		310		2,220		277,528		279,748
Consumer Loans	219		64		252		535		79,369		79,904
Credit Cards	86		24		146		256		17,256		17,512
Residential Mortgage Loans	6,330		2,783		1,051		10,164		340,518		350,682
Total	$	10,633	$	3,706	$	10,783	$	25,122	$	3,763,523	$	3,788,645

Loan Modifications Made to Borrowers Experiencing Financial Difficulty

Effective January 1, 2023, the Company prospectively adopted ASU 2022-02, which eliminated the accounting for troubled debt restructurings while establishing a new standard for the treatment of modifications made to borrowers experiencing financial difficulties. As such, effective with the adoption of the new standard, the Company will not include, prospectively, financial difficulty modifications in its presentation of nonperforming loans, nonperforming assets or classified assets. Prior period data, which included troubled debt restructurings, has not been adjusted.

The Company’s loan modifications for borrowers experiencing financial difficulties will typically include one or a combination of the following: a reduction of the stated interest rate of the loan; an extension of the maturity date at a stated rate of interest lower than the current market rate for new debt with similar risk; or a permanent reduction of the recorded investment in the loan. No modifications in 2023 resulted in the permanent reduction of the recorded investment in the loan.

During the three and six months ended June 30, 2023, the Company had no modified loans made to borrowers experiencing financial difficulty. There were no modified loans that had a payment default during the three and six months ended June 30, 2023 and were modified in the twelve months prior to that default to borrowers experiencing financial difficulty. The Company considers a loan to be in payment default once it is 30 days contractually past due under the modified terms.

21

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 6 - Loans (continued)

Troubled Debt Restructurings Disclosures Prior to Adoption of ASU 2022-02

In certain instances, the Company may choose to restructure the contractual terms of loans. A troubled debt restructuring occurs when the Bank grants a concession to the borrower that it would not otherwise consider due to a borrower’s financial difficulty. In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without modification. This evaluation is performed under the Company’s internal underwriting policy. The Company uses the same methodology for loans acquired with deteriorated credit quality as for all other loans when determining whether the loan is a troubled debt restructuring.

As of December 31, 2022, the Company had no troubled debt restructurings. The Company had no specific allocation of allowance for these loans at December 31, 2022.

The Company had not committed to lending any additional amounts as of December 31, 2022 to customers with outstanding loans that are classified as troubled debt restructurings.

For the year ended December 31, 2022, the Company had no loans modified as troubled debt restructurings. Additionally, there were no loans modified as troubled debt restructurings for which there was a payment default within twelve months following the modification during the year ended December 31, 2022.

A loan is considered to be in payment default once it is 30 days contractually past due under the modified terms.

Credit Quality Indicators:

The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company classifies loans as to credit risk by individually analyzing loans. This analysis includes commercial and industrial loans, commercial real estate loans, and agricultural loans with an outstanding balance greater than $250. This analysis is typically performed on at least an annual basis. The Company uses the following definitions for risk ratings:

Special Mention. Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.

Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass rated loans.

22

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 6 - Loans (continued)

Based on the analysis performed at June 30, 2023 and December 31, 2022, the risk category of loans by class of loans is as follows:

	Term Loans Amortized Cost Basis by Origination Year
As of June 30, 2023	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Commercial and Industrial:
Risk Rating
Pass	$	54,328	$	146,823	$	97,546	$	33,668	$	39,516	$	60,729	$	144,955	$	577,565
Special Mention	—		55		446		589		650		1,504		5,182		8,426
Substandard	25		530		5,248		550		1,156		2,145		12,639		22,293
Doubtful	—		—		—		—		—		—		—		—
Total Commercial & Industrial Loans	$	54,353	$	147,408	$	103,240	$	34,807	$	41,322	$	64,378	$	162,776	$	608,284
Current Period Gross Charge-Offs	$	—	$	861	$	32	$	33	$	—	$	50	$	101	$	1,077
Commercial Real Estate:
Risk Rating
Pass	$	151,013	$	411,741	$	488,764	$	232,238	$	153,101	$	499,661	$	32,722	$	1,969,240
Special Mention	13,647		836		948		4,774		243		20,191		—		40,639
Substandard	—		205		5,349		672		1,123		3,501		380		11,230
Doubtful	—		—		—		—		—		—		—		—
Total Commercial Real Estate Loans	$	164,660	$	412,782	$	495,061	$	237,684	$	154,467	$	523,353	$	33,102	$	2,021,109
Current Period Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Agricultural:
Risk Rating
Pass	$	24,291	$	59,278	$	43,841	$	44,708	$	23,191	$	107,131	$	61,116	$	363,556
Special Mention	1,617		333		1,028		5,856		2,593		10,950		4,159		26,536
Substandard	—		—		206		622		335		4,211		—		5,374
Doubtful	—		—		—		—		—		—		—		—
Total Agricultural Loans	$	25,908	$	59,611	$	45,075	$	51,186	$	26,119	$	122,292	$	65,275	$	395,466
Current Period Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	25	$	—	$	25
Leases:
Risk Rating
Pass	$	15,188	$	15,821	$	12,454	$	7,925	$	7,142	$	2,323	$	—	$	60,853
Special Mention	—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Total Leases	$	15,188	$	15,821	$	12,454	$	7,925	$	7,142	$	2,323	$	—	$	60,853
Current Period Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

23

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 6 - Loans (continued)

	Term Loans Amortized Cost Basis by Origination Year
As of December 31, 2022	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Total
Commercial and Industrial:
Risk Rating
Pass	$	156,318	$	117,648	$	39,949	$	46,505	$	18,423	$	51,482	$	154,203	$	584,528
Special Mention	56		148		577		78		551		2,346		1,672		5,428
Substandard	1,714		5,629		849		1,304		1,028		2,237		17,389		30,150
Doubtful	—		—		—		—		—		—		—		—
Total Commercial & Industrial Loans	$	158,088	$	123,425	$	41,375	$	47,887	$	20,002	$	56,065	$	173,264	$	620,106
Commercial Real Estate:
Risk Rating
Pass	$	398,631	$	490,747	$	261,462	$	162,701	$	129,151	$	427,433	$	35,163	$	1,905,288
Special Mention	3,982		1,568		4,612		135		13,689		25,371		—		49,357
Substandard	—		4,628		489		1,415		979		4,728		—		12,239
Doubtful	—		—		—		—		—		—		—		—
Total Commercial Real Estate Loans	$	402,613	$	496,943	$	266,563	$	164,251	$	143,819	$	457,532	$	35,163	$	1,966,884
Agricultural:
Risk Rating
Pass	$	62,673	$	47,682	$	47,355	$	25,431	$	21,728	$	92,344	$	83,862	$	381,075
Special Mention	634		842		6,066		4,149		2,355		11,440		4,310		29,796
Substandard	—		210		628		429		85		5,190		—		6,542
Doubtful	—		—		—		—		—		—		—		—
Total Agricultural Loans	$	63,307	$	48,734	$	54,049	$	30,009	$	24,168	$	108,974	$	88,172	$	417,413
Leases:
Risk Rating
Pass	$	20,057	$	14,461	$	9,648	$	8,901	$	1,851	$	1,478	$	—	$	56,396
Special Mention	—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Total Leases	$	20,057	$	14,461	$	9,648	$	8,901	$	1,851	$	1,478	$	—	$	56,396

24

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 6 - Loans (continued)

The Company considers the performance of the loan portfolio and its impact on the allowance for credit losses. For residential and consumer loan classes, the Company also evaluates credit quality based on the aging status of the loan, which was previously presented, and by payment activity.  The following tables present the amortized cost in residential, home equity and consumer loans based on payment activity.

	Term Loans Amortized Cost Basis by Origination Year
As of June 30, 2023	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Consumer:
Payment performance
Performing	$	29,474	$	32,598	$	13,564	$	4,116	$	1,412	$	2,456	$	1,957	$	85,577
Nonperforming	—		7		10		—		—		1		—		18
Total Consumer Loans	$	29,474	$	32,605	$	13,574	$	4,116	$	1,412	$	2,457	$	1,957	$	85,595
Current Period Gross Charge-Offs	$	554	$	24	$	20	$	19	$	3	$	1	$	7	$	628
Home Equity:
Payment performance
Performing	$	—	$	75	$	86	$	90	$	24	$	960	$	282,779	$	284,014
Nonperforming	—		40		252		—		44		99		68		503
Total Home Equity Loans	$	—	$	115	$	338	$	90	$	68	$	1,059	$	282,847	$	284,517
Current Period Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	24	$	15	$	39
Residential Mortgage:
Payment performance
Performing	$	28,513	$	68,601	$	90,501	$	43,591	$	18,887	$	104,460	$	—	$	354,553
Nonperforming	—		—		140		124		108		404		—		776
Total Residential Mortgage Loans	$	28,513	$	68,601	$	90,641	$	43,715	$	18,995	$	104,864	$	—	$	355,329
Current Period Gross Charge-Offs	$	—	$	—	$	21	$	36	$	—	$	—	$	—	$	57

25

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 6 - Loans (continued)

	Term Loans Amortized Cost Basis by Origination Year
As of December 31, 2022	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Total
Consumer:
Payment performance
Performing	$	42,685	$	22,708	$	5,610	$	2,394	$	1,543	$	1,553	$	3,157	$	79,650
Nonperforming	3		19		212		8		2		10		—		254
Total Consumer Loans	$	42,688	$	22,727	$	5,822	$	2,402	$	1,545	$	1,563	$	3,157	$	79,904
Home Equity:
Payment performance
Performing	$	63	$	—	$	—	$	—	$	—	$	591	$	278,784	$	279,438
Nonperforming	—		20		—		—		19		1		270		310
Total Home Equity Loans	$	63	$	20	$	—	$	—	$	19	$	592	$	279,054	$	279,748
Residential Mortgage:
Payment performance
Performing	$	69,982	$	97,176	$	46,851	$	20,080	$	16,664	$	98,699	$	—	$	349,452
Nonperforming	—		161		253		—		78		738		—		1,230
Total Residential Mortgage Loans	$	69,982	$	97,337	$	47,104	$	20,080	$	16,742	$	99,437	$	—	$	350,682

The Company considers the performance of the loan portfolio and its impact on the allowance for credit loan losses. For certain retail loan classes, the Company also evaluates credit quality based on the aging status of the loan, which was previously presented, and by payment activity. The following table presents the recorded investment in credit cards based on payment activity:

Credit Cards	June 30, 2023		December 31, 2022
Performing	$	19,209	$	17,366
Nonperforming	119		146
Total	$	19,328	$	17,512

The following tables present loans purchased and/or sold during the year by portfolio segment and excludes the business combination activity:

June 30, 2023	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Total
Purchases	$	—	$	173	$	—	$	—	$	—	$	—	$	—	$	—	$	173
Sales	—		—		—		—		—		—		—		—		—

December 31, 2022	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Total
Purchases	$	522	$	411	$	—	$	—	$	—	$	—	$	—	$	—	$	933
Sales	—		3,819		97		—		—		—		—		—		3,916

26

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 7 – Repurchase Agreements Accounted for as Secured Borrowings

Repurchase agreements are short-term borrowings included in FHLB Advances and Other Borrowings and mature overnight and continuously. Repurchase agreements, which were secured by mortgage-backed securities, totaled $51,874 and $64,961 as of June 30, 2023 and December 31, 2022, respectively. Risk could arise when the collateral pledged to a repurchase agreement declines in fair value. The Company minimizes risk by consistently monitoring the value of the collateral pledged. At the point in time where the collateral has declined in fair value, the Company is required to provide additional collateral based on the value of the underlying securities.

NOTE 8 – Segment Information

The Company’s operations include three primary segments: core banking, wealth management services, and insurance operations. The core banking segment involves attracting deposits from the general public and using such funds to originate consumer, commercial and agricultural, commercial and agricultural real estate, and residential mortgage loans, primarily in the Company’s local markets. The core banking segment also involves the sale of residential mortgage loans in the secondary market. The wealth management segment involves providing trust, investment advisory, brokerage and retirement planning services to customers. The insurance segment offers a full range of personal and corporate property and casualty insurance products, primarily in the Company’s banking subsidiary’s local markets.

The core banking segment is comprised by the Company’s banking subsidiary, German American Bank, which operated through 76 banking offices at June 30, 2023. Net interest income from loans and investments funded by deposits and borrowings is the primary revenue for the core-banking segment. The wealth management segment’s revenues are comprised primarily of fees generated by the trust operations of the Company’s banking subsidiary and by German American Investment Services, Inc. These fees are derived by providing trust, investment advisory, brokerage and retirement planning services to its customers. The insurance segment primarily consists of German American Insurance, Inc., which provides a full line of personal and corporate insurance products. Commissions derived from the sale of insurance products are the primary source of revenue for the insurance segment.

The following segment financial information has been derived from the internal financial statements of the Company which are used by management to monitor and manage financial performance. The accounting policies of the three segments are the same as those of the Company. The evaluation process for segments does not include holding company income and expense. Holding company amounts are the primary differences between segment amounts and consolidated totals, and are reflected in the column labeled “Other” below, along with amounts to eliminate transactions between segments.

	Core Banking		Wealth Management Services		Insurance		Other		Consolidated Totals
Three Months Ended
June 30, 2023
Net Interest Income	$	49,429	$	30	$	15	$	(1,216)	$	48,258
Net Gains on Sales of Loans	630		—		—		—		630
Net Gains on Securities	38		—		—		—		38
Wealth Management Fees	1		2,911		—		—		2,912
Insurance Revenues	1		3		2,126		—		2,130
Noncash Items:
Provision (Benefit) for Credit Losses	550		—		—		—		550
Depreciation and Amortization	2,275		10		12		114		2,411
Income Tax Expense (Benefit)	4,988		161		93		(487)		4,755
Segment Profit (Loss)	21,951		715		247		(790)		22,123
Segment Assets at June 30, 2023	6,045,924		10,225		15,693		(18,573)		6,053,269

27

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 8 - Segment Information (continued)

	Core Banking		Wealth Management Services		Insurance		Other		Consolidated Totals
Three Months Ended
June 30, 2022
Net Interest Income	$	50,474	$	9	$	3	$	(889)	$	49,597
Net Gains on Sales of Loans	1,049		—		—		—		1,049
Net Gains on Securities	78		—		—		—		78
Wealth Management Fees	1		2,641		—		—		2,642
Insurance Revenues	2		1		2,251		—		2,254
Noncash Items:
Provision (Benefit) for Credit Losses	300		—		—		—		300
Depreciation and Amortization	2,459		11		12		114		2,596
Income Tax Expense (Benefit)	5,129		198		133		(431)		5,029
Segment Profit (Loss)	23,519		617		420		(809)		23,747
Segment Assets at December 31, 2022	6,152,346		8,846		14,706		(19,907)		6,155,991

	Core Banking		Wealth Management Services		Insurance		Other		Consolidated Totals
Six Months Ended
June 30, 2023
Net Interest Income	$	99,570	$	54	$	29	$	(2,386)	$	97,267
Net Gains on Sales of Loans	1,217		—		—		—		1,217
Net Gains on Securities	40		—		—		—		40
Wealth Management Fees	3		5,553		—		—		5,556
Insurance Revenues	1		20		5,244		—		5,265
Noncash Items:
Provision (Benefit) for Credit Losses	1,650		—		—		—		1,650
Depreciation and Amortization	4,568		19		25		228		4,840
Income Tax Expense (Benefit)	9,390		290		320		(792)		9,208
Segment Profit (Loss)	42,515		1,322		1,308		(2,215)		42,930
Segment Assets at June 30, 2023	6,045,924		10,225		15,693		(18,573)		6,053,269

28

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 8 - Segment Information (continued)

	Core Banking		Wealth Management Services		Insurance		Other		Consolidated Totals
Six Months Ended
June 30, 2022
Net Interest Income	$	98,139	$	14	$	6	$	(1,654)	$	96,505
Net Gains on Sales of Loans	2,470		—		—		—		2,470
Net Gains on Securities	450		—		—		—		450
Wealth Management Fees	2		5,278		—		—		5,280
Insurance Revenues	29		2		5,944		—		5,975
Noncash Items:
Provision (Benefit) for Credit Losses	5,500		—		—		—		5,500
Depreciation and Amortization	4,977		21		24		228		5,250
Income Tax Expense (Benefit)	5,745		402		583		(1,032)		5,698
Segment Profit (Loss)	31,948		1,257		1,849		(2,240)		32,814
Segment Assets at December 31, 2022	6,152,346		8,846		14,706		(19,907)		6,155,991

NOTE 9 – Stock Repurchase Plan

On January 31, 2022, the Company’s Board of Directors approved a plan to repurchase up to 1,000,000 shares of the Company’s outstanding common stock. On a share basis, the amount of common stock subject to the repurchase plan represented approximately 3% of the Company’s outstanding shares at the time it was approved. The Company is not obligated to purchase shares under the plan, and the plan may be discontinued at any time. The actual timing, number and share price of shares purchased under the repurchase plan will be determined by the Company at its discretion and will depend upon such factors as the market price of the stock, general market and economic conditions and applicable legal requirements. At the time it approved the new plan, the Board also terminated a similar plan that had been adopted in January 2021. At the time of its termination, the Company had been authorized to purchase up to 1,000,000 shares of common stock under the 2021 repurchase plan. The Company did not repurchase any shares of common stock under the 2021 repurchase plan and has not repurchased any shares under the 2022 repurchase plan.

In August 2022, the Inflation Reduction Act of 2022 (the “IRA”) was enacted. Among other things, the IRA imposes a new 1% excise tax on the fair value of stock repurchased after December 31, 2022 by publicly traded U.S. corporations, like the Company. With certain exceptions, the value of stock repurchased is determined net of stock issued in the year, including shares issued pursuant to compensatory arrangements.

NOTE 10 – Equity Plans and Equity Based Compensation

During the periods presented, the Company maintained two equity incentive plans under which stock options, restricted stock, and other equity incentive awards could be granted. Those plans include (i) the Company’s 2009 Long-Term Equity Incentive Plan, under which no new grants may be made, and (ii) the Company’s 2019 Long-Term Equity Incentive Plan (the “2019 LTI Plan”). The 2019 LTI Plan, which authorizes a maximum aggregate issuance of 1,000,000 shares of common stock (subject to certain permitted adjustments), became effective on May 16, 2019, following approval of the Company’s shareholders. It will remain in effect until May 16, 2029, or until all shares of common stock subject to the 2019 LTI Plan are distributed, all awards have expired or terminated, or the plan is terminated pursuant to its terms, whichever occurs first.

For the three and six months ended June 30, 2023 and 2022, the Company granted no options.  The Company recorded no stock compensation expense applicable to options during the three and six months ended Junes 30, 2023 and 2022.  In addition, there was no unrecognized option expense. 

During the periods presented, awards of long-term incentives were granted in the form of restricted stock.  In 2019 and prior, awards that were granted to management and selected other employees under the Company's management incentive plan were granted in tandem with cash credit entitlements in the form of 60% restricted stock grants and 40% cash credit entitlements. In

29

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 10 - Equity Plans and Equity Based Compensation (continued)

2020, awards granted under the management incentive plan were granted in tandem with cash credit entitlements in the form of 66.67% restricted stock grants and 33.33% cash credit entitlements. In 2019 and prior, the restricted stock grants and tandem cash credit entitlements, generally, vested in three annual installments of 33.33% each. In 2020, 100% of the cash portion of an award vested towards the end of the year in which the grant was made, followed by the restricted stock grants vesting 50% in each of the 2nd and 3rd years. Beginning in 2021, for named executive officers, awards are granted in the form of 100% restricted stock grants which vest in one-third installments on the first, second and third anniversaries of the award date. Awards that are granted to directors as additional retainers for their services do not include any cash credit entitlement. These director restricted stock grants are subject to forfeiture in the event that the recipient of the grant does not continue in service as a director of the Company through December 31 of the year after grant or does not satisfy certain meeting attendance requirements, at which time they generally vest 100%. For measuring compensation costs, restricted stock awards are valued based upon the market value of the common shares on the date of grant. During the three and six months ended June 30, 2023, the Company granted 728 and 81,118 shares, respectively, of restricted stock. During the three months ended June 30, 2022, the Company granted no awards of restricted stock. During the six months ended June 30, 2022, the Company granted 63,258 shares of restricted stock. Total unvested shares of restricted stock at June 30, 2023 and December 31, 2022 were 133,954 and 74,873, respectively.

The following table presents expense recorded for restricted stock and cash entitlements as well as the related tax information for the periods presented:

	Three Months Ended  June 30,
	2023		2022
Restricted Stock Expense	$	830	$	1,093
Cash Entitlement Expense	179		169
Tax Effect	(262)		(327)
Net of Tax	$	747	$	935

	Six Months Ended  June 30,
	2023		2022
Restricted Stock Expense	$	1,369	$	1,517
Cash Entitlement Expense	361		334
Tax Effect	(449)		(480)
Net of Tax	$	1,281	$	1,371

Unrecognized expense associated with the restricted stock grants and cash entitlements totaled $4,490 and $3,503 as of June 30, 2023 and 2022, respectively.

The Company’s shareholders approved the Company’s 2019 Employee Stock Purchase Plan on May 16, 2019, as well as an Amended and Restated 2019 Employee Stock Purchase Plan on May 21, 2020, which was amended and restated to reflect certain clarifying changes (the "2019 ESPP"). The 2019 ESPP replaced the Company's 2009 Employee Stock Purchase Plan, which expired by its own terms on August 16, 2019. The 2019 ESPP provides for a series of 3-month offering periods, commencing on the first day and ending on the last trading day of each calendar quarter, for the purchase of the Company’s common stock by participating employees. The purchase price of the shares has been set at 95% of the fair value of the Company’s common stock on the last trading day of the offering period. A total of 750,000 common shares has been reserved for issuance under the 2019 ESPP. The 2019 ESPP will continue until September 30, 2029, or, if earlier, until all of the shares of common stock allocated to the 2019 ESPP have been purchased. Funding for the purchase of common stock is from employee and Company contributions.

For the three months ended June 30, 2023, the Company recorded $4 of expense related to the employee stock purchase plan resulting in $3 net of tax. For the six months ended June 30, 2023, the Company recorded $16 of expense related to the employee stock purchase plan resulting in $12 net of tax. For the three months ended June 30, 2022, the Company recorded $14 of expense related to the employee stock purchase plan resulting in $10 net of tax. For the six months ended June 30, 2022,

30

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 10 - Equity Plans and Equity Based Compensation (continued)

the Company recorded $28 of expense related to the employee stock purchase plan resulting in $21 net of tax. There was no unrecognized compensation expense as of June 30, 2023 and 2022 for the employee stock purchase plan. No stock options were outstanding as of June 30, 2023 and December 31, 2022.

NOTE 11 – Fair Value

Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values:

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

The Company used the following methods and significant assumptions to estimate the fair value of each type of financial instrument:

Investment Securities: The fair values for investment securities are determined by quoted market prices, if available (Level 1). For investment securities where quoted prices are not available, fair values are calculated based on market prices of similar investment securities (Level 2). For investment securities where quoted prices or market prices of similar investment securities are not available, fair values are calculated using discounted cash flows or other market indicators (Level 3). Level 3 pricing is obtained from a third-party based upon similar trades that are not traded frequently without adjustment by the Company. At June 30, 2023, the Company held $84 in Level 3 securities which consist of non-rated Obligations of State and Political Subdivisions and $919 in Level 3 securities which consist of non-rated MBS/CMO. Absent the credit rating, significant assumptions must be made such that the credit risk input becomes an unobservable input and thus these investment securities are reported by the Company in a Level 3 classification.

Derivatives: The fair values of derivatives are based on valuation models using observable market data as of the measurement date (Level 2).

Individually Analyzed Loans: Fair values for collateral dependent loans are generally based on appraisals obtained from licensed real estate appraisers and in certain circumstances includes consideration of offers obtained to purchase properties prior to foreclosure. Appraisals for commercial real estate generally use three methods to derive value: cost, sales or market comparison and income approach. The cost method bases value in the cost to replace the current property. Value of market comparison approach evaluates the sales price of similar properties in the same market area. The income approach considers net operating income generated by the property and an investor's required return. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available. Comparable sales adjustments are based on known sales prices of similar type and similar use properties and duration of time that the property has been on the market to sell. Such adjustments made in the appraisal process are typically significant and result in a Level 3 classification of the inputs for determining fair value.

Appraisals for both collateral-dependent loans and other real estate owned are performed by certified general appraisers (for commercial properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by the Company. Once received, a member of the Company’s Risk Management Area reviews the assumptions and approaches utilized in the appraisal. In determining the value of collateral dependent loans and other real estate owned, significant unobservable inputs may be used which include: physical condition of comparable properties sold, net operating income generated by the property and investor rates of return.

31

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 11 - Fair Value (continued)

Other Real Estate: Nonrecurring adjustments to certain commercial and residential real estate properties classified as other real estate are measured at the lower of carrying amount or fair value, less costs to sell. Fair values are generally based on third party appraisals of the property utilizing similar techniques as discussed above for Individually Analyzed Loans, resulting in a Level 3 classification. In cases where the carrying amount exceeds the fair value, less costs to sell, impairment loss is recognized.

Loans Held-for-Sale: The fair values of loans held for sale are determined by using quoted prices for similar assets, adjusted for specific attributes of that loan resulting in a Level 2 classification.

Assets and Liabilities Measured on a Recurring Basis

Assets and liabilities measured at fair value on a recurring basis, including financial assets and liabilities for which the Company has elected the fair value option, are summarized below:

	Fair Value Measurements at June 30, 2023 Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)		Total
Assets:
U.S. Treasury	$	1,000	$	—	$	—	$	1,000
Obligations of State and Political Subdivisions	—		747,222		84		747,306
MBS/CMO	—		664,950		919		665,869
US Gov’t Sponsored Entities & Agencies	—		186,534		—		186,534
Total Securities	$	1,000	$	1,598,706	$	1,003	$	1,600,709
Loans Held-for-Sale	$	—	$	8,239	$	—	$	8,239
Derivative Assets	$	—	$	9,183	$	—	$	9,183
Derivative Liabilities	$	—	$	9,112	$	—	$	9,112

	Fair Value Measurements at December 31, 2022 Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)		Total
Assets:
U.S. Treasury	$	64,119	$	—	$	—	$	64,119
Obligations of State and Political Subdivisions	—		777,769		83		777,852
MBS/CMO	—		713,775		906		714,681
US Gov’t Sponsored Entities & Agencies	—		205,017		—		205,017
Total Securities	$	64,119	$	1,696,561	$	989	$	1,761,669
Loans Held-for-Sale	$	—	$	8,600	$	—	$	8,600
Derivative Assets	$	—	$	9,899	$	—	$	9,899
Derivative Liabilities	$	—	$	9,749	$	—	$	9,749

32

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 11 - Fair Value (continued)

As of June 30, 2023 and December 31, 2022, the aggregate fair value, contractual balance (including accrued interest), and gain or loss on Loans Held-for-Sale was as follows:

	June 30, 2023		December 31, 2022
Aggregate Fair Value	$	8,239	$	8,600
Contractual Balance	8,083		8,474
Gain (Loss)	156		126

The total amount of gains and losses from changes in fair value included in earnings for the three months ended June 30, 2023 and 2022 were $59 and $(94), respectively. The total amount of gains and losses from changes in fair value included in earnings for the six months ended June 30, 2023 and 2022 were $30 and $(135), respectively.

The table below presents a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three and six months ended June 30, 2023 and 2022:

	Obligations of State and Political Subdivisions				MBS/CMO
	2023		2022		2023		2022
Balance of Recurring Level 3 Assets at April 1	$	83	$	94	$	917	$	—
Total Gains Included in Other Comprehensive Income	1		—		2		—
Maturities / Calls	—		—		—		—
Acquired through Bank Acquisition	—		—		—		—
Balance of Recurring Level 3 Assets at June 30	$	84	$	94	$	919	$	—

	Obligations of State and Political Subdivisions				MBS/CMO
	2023		2022		2023		2022
Balance of Recurring Level 3 Assets at January 1	$	83	$	—	$	906	$	—
Total Gains Included in Other Comprehensive Income	1		—		13		—
Maturities / Calls	—		—		—		—
Acquired through Bank Acquisition	—		94		—		—
Balance of Recurring Level 3 Assets at June 30	$	84	$	94	$	919	$	—

Of the total gain (loss) included in earnings for the three months ended June 30, 2023 and 2022, $3 and $0 was attributable to other changes in fair value, respectively. Of the total gain (loss) included in earnings for the six months ended June 30, 2023 and 2022, $14 and $0 was attributable to other changes in fair value, respectively.

33

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 11 - Fair Value (continued)

Assets and Liabilities Measured on a Non-Recurring Basis

Assets and liabilities measured at fair value on a non-recurring basis are summarized below:

	Fair Value Measurements at June 30, 2023 Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)		Total
Assets:
Individually Analyzed Loans
Commercial and Industrial Loans	$	—	$	—	$	1,664	$	1,664
Commercial Real Estate Loans	$	—	$	—	$	7,266	$	7,266
Agricultural Loans	$	—	$	—	$	2,919	$	2,919
Consumer Loans	$	—	$	—	$	9	$	9
Home Equity Loans	$	—	$	—	$	362	$	362
Residential Mortgage Loans	$	—	$	—	$	546	$	546

	Fair Value Measurements at December 31, 2022 Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)		Total
Assets:
Individually Analyzed Loans
Commercial and Industrial Loans	$	—	$	—	$	1,858	$	1,858
Commercial Real Estate Loans	$	—	$	—	$	10,040	$	10,040
Agricultural Loans	$	—	$	—	$	2,970	$	2,970
Consumer Loans	$	—	$	—	$	8	$	8
Home Equity Loans	$	—	$	—	$	368	$	368
Residential Mortgage Loans	$	—	$	—	$	718	$	718

34

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 11 - Fair Value (continued)

The following tables present quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at June 30, 2023 and December 31, 2022:

June 30, 2023	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Individual Analyzed Loans -     Commercial and Industrial Loans	$	1,664	Sales comparison approach	Adjustment for physical condition of comparable properties sold	0%-100% (40%)
Individual Analyzed Loans -     Commercial Real Estate Loans	$	7,266	Sales comparison approach	Adjustment for physical condition of comparable properties sold	25%-68% (36%)
Individual Analyzed Loans -     Agricultural Loans	$	2,919	Sales comparison approach	Adjustment for physical condition of comparable properties sold	30%-100% (50%)
Individual Analyzed Loans -     Consumer Loans	$	9	Sales comparison approach	Adjustment for physical condition of comparable properties sold	20%-27% (20%)
Individual Analyzed Loans -     Home Equity Loans	$	362	Sales comparison approach	Adjustment for physical condition of comparable properties sold	20%-20% (20%)
Individual Analyzed Loans -     Residential Mortgage Loans	$	546	Sales comparison approach	Adjustment for physical condition of comparable properties sold	20%-100% (20%)

December 31, 2022	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Individual Analyzed Loans -     Commercial and Industrial Loans	$	1,858	Sales comparison approach	Adjustment for physical condition of comparable properties sold	0%-100% (40%)
Individual Analyzed Loans -     Commercial Real Estate Loans	$	10,040	Sales comparison approach	Adjustment for physical condition of comparable properties sold	30%-100% (37%)
Individual Analyzed Loans -     Agricultural Loans	$	2,970	Sales comparison approach	Adjustment for physical condition of comparable properties sold	30%-100% (48%)
Individual Analyzed Loans -     Consumer Loans	$	8	Sales comparison approach	Adjustment for physical condition of comparable properties sold	27%-100% (20%)
Individual Analyzed Loans -     Home Equity Loans	$	368	Sales comparison approach	Adjustment for physical condition of comparable properties sold	20%-51% (20%)
Individual Analyzed Loans -     Residential Mortgage Loans	$	718	Sales comparison approach	Adjustment for physical condition of comparable properties sold	20%-100% (21%)

35

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 11 - Fair Value (continued)

The carrying amounts and estimated fair values of the Company’s financial instruments not previously presented are provided in the tables below for the periods ending June 30, 2023 and December 31, 2022. Not all of the Company’s assets and liabilities are considered financial instruments, and therefore are not included in the tables. Because no active market exists for a significant portion of the Company’s financial instruments, fair value estimates were based on subjective judgments, and therefore cannot be determined with precision.

			Fair Value Measurements at June 30, 2023 Using
	Carrying Value		Level 1		Level 2		Level 3		Total
Financial Assets:
Cash and Short-term Investments	$	140,671	$	78,223	$	62,448	$	—	$	140,671
Interest Bearing Time Deposits with Banks	500		—		500		—		500
Loans, Net	3,768,977		—		—		3,691,120		3,691,120
Accrued Interest Receivable	25,996		—		10,143		15,853		25,996
Financial Liabilities:
Demand, Savings, and Money Market Deposits	(4,596,960)		(4,596,960)		—		—		(4,596,960)
Time Deposits	(582,745)		—		(578,094)		—		(578,094)
Short-term Borrowings	(99,674)		(47,800)		(51,874)		—		(99,674)
Long-term Debt	(127,810)		—		(51,978)		(71,893)		(123,871)
Accrued Interest Payable	(3,896)		—		(3,534)		(362)		(3,896)

			Fair Value Measurements at December 31, 2022 Using
	Carrying Value		Level 1		Level 2		Level 3		Total
Financial Assets:
Cash and Short-term Investments	$	119,079	$	77,174	$	41,905	$	—	$	119,079
Interest Bearing Time Deposits with Banks	500		—		500		—		500
Loans, Net	3,724,804		—		—		3,688,903		3,688,903
Accrued Interest Receivable	27,741		38		10,863		16,840		27,741
Financial Liabilities:
Demand, Savings, and Money Market Deposits	(4,921,582)		(4,921,582)		—		—		(4,921,582)
Time Deposits	(428,469)		—		(426,184)		—		(426,184)
Short-term Borrowings	(101,161)		(36,200)		(64,961)		—		(101,161)
Long-term Debt	(102,645)		—		(26,830)		(72,272)		(99,102)
Accrued Interest Payable	(1,513)		—		(1,205)		(308)		(1,513)

36

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 12 - Other Comprehensive Income (Loss)

The tables below summarize the changes in accumulated other comprehensive income (loss) by component for the three and six months ended June 30, 2023 and 2022, net of tax:

June 30, 2023	Unrealized Gains and Losses on Available-for-Sale Securities		Postretirement Benefit Items		Total
Beginning Balance at April 1, 2023	$	(229,978)	$	(514)	$	(230,492)
Other Comprehensive Income (Loss) Before Reclassification	(18,330)		—		(18,330)
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(30)		—		(30)
Net Current Period Other Comprehensive Income (Loss)	(18,360)		—		(18,360)
Ending Balance at June 30, 2023	$	(248,338)	$	(514)	$	(248,852)

June 30, 2023	Unrealized Gains and Losses on Available-for-Sale Securities		Postretirement Benefit Items		Total
Beginning Balance at January 1, 2023	$	(262,924)	$	(514)	$	(263,438)
Other Comprehensive Income (Loss) Before Reclassification	14,618		—		14,618
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(32)		—		(32)
Net Current Period Other Comprehensive Income (Loss)	14,586		—		14,586
Ending Balance at June 30, 2023	$	(248,338)	$	(514)	$	(248,852)

June 30, 2022	Unrealized Gains and Losses on Available-for-Sale Securities		Postretirement Benefit Items		Total
Beginning Balance at April 1, 2022	$	(117,833)	$	(568)	$	(118,401)
Other Comprehensive Income (Loss) Before Reclassification	(92,632)		—		(92,632)
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(62)		—		(62)
Net Current Period Other Comprehensive Income (Loss)	(92,694)		—		(92,694)
Ending Balance at June 30, 2022	$	(210,527)	$	(568)	$	(211,095)

37

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 12 - Other Comprehensive Income (Loss) (continued)

June 30, 2022	Unrealized Gains and Losses on Available-for-Sale Securities		Postretirement Benefit Items		Total
Beginning Balance at January 1, 2022	$	16,052	$	(568)	$	15,484
Other Comprehensive Income (Loss) Before Reclassification	(226,223)		—		(226,223)
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(356)		—		(356)
Net Current Period Other Comprehensive Income (Loss)	(226,579)		—		(226,579)
Ending Balance at June 30, 2022	$	(210,527)	$	(568)	$	(211,095)

The tables below summarize the classifications out of accumulated other comprehensive income (loss) by component for the three and six months ended June 30, 2023 and 2022:

Details about Accumulated Other Comprehensive Income (Loss) Components	Amount Reclassified From Accumulated Other Comprehensive Income (Loss)		Affected Line Item in the Statement Where Net Income is Presented
Unrealized Gains and Losses on     Available-for-Sale Securities	$	38	Net Gains on Securities
	(8)		Income Tax Expense
	30		Net of Tax
Total Reclassifications for the Three     Months Ended June 30, 2023	$	30

Details about Accumulated Other Comprehensive Income (Loss) Components	Amount Reclassified From Accumulated Other Comprehensive Income (Loss)		Affected Line Item in the Statement Where Net Income is Presented
Unrealized Gains and Losses on     Available-for-Sale Securities	$	40	Net Gains on Securities
	(8)		Income Tax Expense
	32		Net of Tax
Total Reclassifications for the Six     Months Ended June 30, 2023	$	32

38

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 12 - Other Comprehensive Income (Loss) (continued)

Details about Accumulated Other Comprehensive Income (Loss) Components	Amount Reclassified From Accumulated Other Comprehensive Income (Loss)		Affected Line Item in the Statement Where Net Income is Presented
Unrealized Gains and Losses on     Available-for-Sale Securities	$	78	Net Gains on Securities
	(16)		Income Tax Expense
	62		Net of Tax
Total Reclassifications for the Three     Months Ended June 30, 2022	$	62

Details about Accumulated Other Comprehensive Income (Loss) Components	Amount Reclassified From Accumulated Other Comprehensive Income (Loss)		Affected Line Item in the Statement Where Net Income is Presented
Unrealized Gains and Losses on     Available-for-Sale Securities	$	450	Net Gains on Securities
	(94)		Income Tax Expense
	356		Net of Tax
Total Reclassifications for the Six     Months Ended June 30, 2022	$	356

NOTE 13 - Revenue Recognition

The following table presents non-interest income, segregated by revenue streams in-scope and out-of-scope of FASB ASU No. 2014-09, "Revenue from Contracts with Customers (Topic 606)", for the three and six months ended June 30, 2023 and 2022. Wealth management fees are included in the wealth management services segment while insurance revenues are included in the insurance segment. All other revenue streams are primarily included in the banking segment.

	Three Months Ended
	June 30,
Non-interest Income	2023		2022
In-Scope of Topic 606:
Wealth Management Fees	$	2,912	$	2,642
Service Charges on Deposit Accounts	2,883		2,871
Insurance Revenues	2,130		2,254
Interchange Fee Income	4,412		4,167
Other Operating Income	823		820
Non-interest Income (in-scope of Topic 606)	13,160		12,754
Non-interest Income (out-of-scope of Topic 606)	1,736		2,426
Total Non-interest Income	$	14,896	$	15,180

39

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 13 - Revenue Recognition (continued)

	Six Months Ended
	June 30,
Non-interest Income	2023		2022
In-Scope of Topic 606:
Wealth Management Fees	$	5,556	$	5,280
Service Charges on Deposit Accounts	5,671		5,554
Insurance Revenues	5,265		5,975
Interchange Fee Income	8,611		7,794
Other Operating Income	1,576		1,578
Non-interest Income (in-scope of Topic 606)	26,679		26,181
Non-interest Income (out-of-scope of Topic 606)	3,184		5,187
Total Non-interest Income	$	29,863	$	31,368

A description of the Company’s revenue streams accounted for under Topic 606 follows:

Service Charges on Deposit Accounts: The Company earns fees from its deposit customers for transaction-based, account maintenance, and overdraft services. Transaction-based fees, which include services such as stop payment charges and statement rendering, are recognized at the time the transaction is executed (the point in time the Company fills the customer's request). Account maintenance fees, which relate primarily to monthly maintenance, are earned over the course of a month, representing the period over which the Company satisfies the performance obligation. Overdraft fees are recognized at the point in time that the overdraft occurs.

Interchange Fee Income: The Company earns interchange fees from debit/credit cardholder transactions conducted through various payment networks. Interchange fees from cardholder transactions represent a percentage of the underlying transaction value and are recognized daily, concurrently with the transaction processing services provided to the cardholder.

Wealth Management Fees: The Company earns wealth management fees from its contracts with trust and brokerage customers to manage assets for investment and/or to transact their accounts. These fees are primarily earned over time as the Company provides the contracted monthly or quarterly services and are generally assessed based on the market value of assets under management at month-end. Fees that are transaction based, including trade execution services, are recognized at the point in time that the transaction is executed (trade date).

Insurance Revenues: The Company earns insurance revenue from commissions derived from the sale of personal and corporate property and casualty insurance products. These commissions are primarily earned over time as the Company provides the contracted insurance product to customers.

NOTE 14 – Leases

At the inception of a contract, an entity should determine whether the contract contains a lease. Topic 842 defines a lease as a contract, or part of a contract, that conveys the right to control the use of identified property, plant, or equipment (an identified asset) for a period of time in exchange for consideration. Control over the use of an identified asset means that the customer has both (1) the right to obtain substantially all of the economic benefits from the use of the asset and (2) the right to direct the use of the asset.

The Bank has finance leases for branch offices as well as operating leases for branch offices, ATM locations and certain office equipment. The right-of-use asset is included in the 'Premises, Furniture and Equipment, Net' line of the Consolidated Balance Sheet. The lease liability is included in the 'Accrued Interest Payable and Other Liabilities' line of the Consolidated Balance Sheet.

40

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 14 - Leases (continued)

The Company used the implicit lease rate when determining the present value of lease payments for finance leases. The present value of lease payments for operating leases was determined using the incremental borrowing rate as of the date the Company adopted this standard.

The components of lease expense were as follows:

	Three Months Ended		Three Months Ended
	June 30, 2023		June 30, 2022
Finance Lease Cost:
Amortization of Right-of -Use Assets	$	52	$	53
Interest on Lease Liabilities	77		82
Operating Lease Cost	363		376
Short-term Lease Cost	—		3
Total Lease Cost	$	492	$	514

	Six Months Ended		Six Months Ended
	June 30, 2023		June 30, 2022
Finance Lease Cost:
Amortization of Right-of -Use Assets	$	105	$	105
Interest on Lease Liabilities	155		165
Operating Lease Cost	736		745
Short-term Lease Cost	—		27
Total Lease Cost	$	996	$	1,042

The weighted average lease term and discount rates were as follows:

	June 30, 2023		June 30, 2022
Weighted Average Remaining Lease Term:
Finance Leases	9 years		10 years
Operating Leases	7 years		8 years
Weighted Average Discount Rate:
Finance Leases	11.39	%	11.43	%
Operating Leases	2.84	%	2.85	%

Supplemental balance sheet information related to leases were as follows:

	June 30, 2023		June 30, 2022
Finance Leases
Premises, Furniture and Equipment, Net	$	1,753	$	1,963
Other Borrowings	2,753		2,957
Operating Leases
Operating Lease Right-of-Use Assets	$	5,674	$	6,510
Operating Lease Liabilities	5,816		6,645

41

GERMAN AMERICAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unaudited, dollars in thousands except share and per share data)

NOTE 14 - Leases (continued)

Supplemental cash flow information related to leases were as follows:

	Six Months Ended		Six Months Ended
	June 30, 2023		June 30, 2022
Cash paid for amounts in the Measurement of Lease Liabilities:
Operating Cash Flows from Finance Leases	$	155	$	166
Operating Cash Flows from Operating Leases	722		701
Financing Cash Flows from Finance Leases	101		91

The following table presents a maturity analysis of Finance and Operating Lease Liabilities:

	June 30, 2023
	Finance Leases		Operating Leases
Year 1	$	519	$	1,272
Year 2	519		1,134
Year 3	519		890
Year 4	519		756
Year 5	445		627
Thereafter	1,728		1,798
Total Lease Payments	4,249		6,477
Less Imputed Interest	(1,496)		(661)
Total	$	2,753	$	5,816

42

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

GERMAN AMERICAN BANCORP, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

German American Bancorp, Inc. is a Nasdaq-traded (symbol: GABC) financial holding company based in Jasper, Indiana. The Company, through its banking subsidiary German American Bank, operates 76 banking offices in 20 contiguous southern Indiana counties and 14 Kentucky counties. The Company also owns an investment brokerage subsidiary (German American Investment Services, Inc.) and a full line property and casualty insurance agency (German American Insurance, Inc.).

Throughout this Management’s Discussion and Analysis, as elsewhere in this Report, when we use the term “Company,” we will usually be referring to the business and affairs (financial and otherwise) of German American Bancorp, Inc. and its subsidiaries and affiliates as a whole. Occasionally, we will refer to the term “parent company” or “holding company” when we mean to refer to only German American Bancorp, Inc.

This section presents an analysis of the consolidated financial condition of the Company as of June 30, 2023 and December 31, 2022 and the consolidated results of operations for the three and six months ended June 30, 2023 and 2022. This discussion should be read in conjunction with the consolidated financial statements and other financial data presented elsewhere herein and with the financial statements and other financial data, as well as the Management’s Discussion and Analysis of Financial Condition and Results of Operations, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.

MANAGEMENT OVERVIEW

This updated discussion should be read in conjunction with the Management Overview that was included in our Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.

The failures of Silicon Valley Bank and Signature Bank in March 2023, followed by the failure of First Republic Bank in May 2023, have caused concerns about the adequacy of liquidity in the banking sector as a whole. Despite uncertainties in the banking industry, the Company has not been negatively impacted by the recent bank failures. With its diverse core deposit base and access to other reliable funding sources, the Company has remained well-capitalized. The Company will continue to monitor the developments surrounding the recent bank failures, with a specific focus on managing its liquidity position in a way that balances the needs of the Company’s daily operations with its longer-term strategic objectives.

43

Net income for the quarter ended June 30, 2023 totaled $22,123,000, or $0.75 per share, a decline of 7% on a per share basis compared with the second quarter 2022 net income of $23,747,000, or $0.81 per share. The decline was largely due to a decrease in net interest income totaling $1,339,000. The decline in net interest income during the second quarter of 2023 compared with the second quarter of 2022 was primarily attributable to a decline in average earning assets, driven by a reduced level of average deposits.

Net income for the six months ended June 30, 2023 totaled $42,930,000, or $1.45 per share, an increase of 31% on a per share basis compared with the first half of 2022 net income of $32,814,000, or $1.11 per share. The first six months of 2022 was significantly impacted by costs associated with the acquisition of Citizens Union Bancorp of Shelbyville, Inc. ("CUB") which closed effective January 1, 2022.

On January 1, 2022, the Company completed the acquisition of CUB through the merger of CUB with and into the Company. Immediately following completion of the CUB holding company merger, CUB's subsidiary bank, Citizen Union Bank of Shelbyville, Inc., was merged with and into the Company’s subsidiary bank, German American Bank. CUB, headquartered in Shelbyville, Kentucky operated 15 retail banking offices located in Shelby, Jefferson, Spencer, Bullitt, Oldham, Owen, Gallatin and Hardin counties in Kentucky through Citizens Union Bank of Shelbyville, Inc. As of the closing of the transaction, CUB had total assets of approximately $1.109 billion, total loans of approximately $683.8 million, and total deposits of approximately $930.5 million. The Company issued approximately 2.9 million shares of its common stock, and paid approximately $50.8 million in cash, in exchange for all of the issued and outstanding shares of common stock of CUB.

For further information regarding this merger and acquisition transaction, see Note 18 (Business Combinations, Goodwill and Intangible Assets) in the Notes to the Consolidated Financial Statements included in the Company's Annual Report on Form 10-K.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The financial condition and results of operations for the Company presented in the Consolidated Financial Statements, accompanying Notes to the Consolidated Financial Statements, and selected financial data appearing elsewhere within this Report, are, to a large degree, dependent upon the Company’s accounting policies. The selection of and application of these policies involve estimates, judgments, and uncertainties that are subject to change. The critical accounting policies and estimates that the Company has determined to be the most susceptible to change in the near term relate to the determination of the allowance for credit losses, the valuation of securities available for sale, income tax expense, and the valuation of goodwill and other intangible assets.

Allowance for Credit Losses

The Company maintains an allowance for credit losses to cover the estimated expected credit losses over the expected contractual life of the loan portfolio. Loan losses are charged against the allowance when management believes the uncollectibility of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. Allocations of the allowance may be made for specific loans, but the entire allowance is available for any loan that, in management’s judgment, should be charged-off. A provision for credit losses is charged to operations based on management’s periodic evaluation of the necessary allowance balance. Evaluations are conducted at least quarterly and more often if deemed necessary. The ultimate recovery of all loans is susceptible to future market factors beyond the Company’s control.

The Company has an established process to determine the adequacy of the allowance for credit losses. The determination of the allowance is inherently subjective, as it requires significant estimates, including the amounts and timing of expected future cash flows on individually analyzed loans, estimated losses on other classified loans and pools of homogeneous loans, and consideration of past loan loss experience, the nature and volume of the portfolio, information about specific borrower situations and estimated collateral values, economic conditions, reasonable and supportable forecasts and other factors, all of which may be susceptible to significant change. The allowance consists of two components of allocations, specific and general. These two components represent the total allowance for credit losses deemed adequate to cover expected credit losses over the expected life of the loan portfolio.

Commercial and agricultural loans are subject to a standardized grading process administered by an internal loan review function. The need for specific reserves is considered for credits when: (a) the customer’s cash flow or net worth appears insufficient to repay the loan; (b) the loan has been criticized in a regulatory examination; (c) the loan is on non-accrual; or (d) other reasons where the ultimate collectability of the loan is in question, or the loan characteristics require special monitoring.

44

Specific reserves on individually analyzed loans are determined by comparing the loan balance to the present value of expected cash flows or expected collateral proceeds. Allocations are also applied to categories of loans not individually analyzed but for which the rate of loss is expected to be greater than other similar type loans, including non-performing consumer or residential real estate loans. Such allocations are based on past loss experience, reasonable and supportable forecasts and information about specific borrower situations and estimated collateral values.

General allocations are made for commercial and agricultural loans that are graded as substandard and special mention, but are not individually analyzed for specific reserves as well as other pools of loans, including non-classified loans, homogeneous portfolios of consumer and residential real estate loans, and loans within certain industry categories believed to present unique risk of loss.  General allocations of the allowance are primarily made based on historical averages for loan losses for these portfolios along with reasonable and supportable forecasts, judgmentally adjusted for economic, external and internal quantitative and qualitative factors and portfolio trends. Economic factors include evaluating changes in international, national, regional and local economic and business conditions that affect the collectability of the loan portfolio. Internal factors include evaluating changes in lending policies and procedures; changes in the nature and volume of the loan portfolio; and changes in experience, ability and depth of lending management and staff.

The allowance for credit losses for loans represents management’s estimate of all expected credit losses over the expected contractual life of the loan portfolio. Determining the appropriateness and adequacy of the allowance is complex and requires judgment by management about the effect of matters that are inherently uncertain. Subsequent evaluations of the loan portfolio may result in significant changes in the allowance for credit losses in future periods.

The Company uses a number of economic variables in its scenarios to estimate the allowance for credit losses, with the most significant drivers being an unemployment rate forecast, gross domestic product and the agricultural producer price index, as well as qualitative adjustments. Historical loss rates from periods where the average unemployment rate, gross domestic product and agricultural producer pricing index matches the forecast range are considered when calculating the forecast period loss rate. The impact of loan growth, improvement in individually analyzed loans as well as rising interest rates and expanded inflationary impact on consumer discretionary spending resulted in an increase in the allowance for credit losses of approximately $98,000 between June 30, 2023 and December 31, 2022.

Based on sensitivity analysis of all portfolios, a 0.050% change (slight improvement or decline on the Company's scale) in all ten qualitative risk factors would have a $1,900,000 impact on the reserve allocation. The sensitivity and related range of impact is a hypothetical analysis and is not intended to represent management's judgements or assumptions of qualitative loss factors that were utilized at June 30, 2023 in estimation of the allowance for credit losses on loans recognized on the Consolidated Balance Sheets.

Securities Valuation

Available-for-sale debt securities in unrealized loss positions are evaluated for impairment related to credit losses at least quarterly. For available-for-sale debt securities in an unrealized loss position, the Company assesses whether we intend to sell, or it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through income. For available-for sale debt securities that do not meet the criteria, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, management considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and adverse conditions specifically related to the security and the issuer, among other factors. If this assessment indicates that a credit loss exists, the Company compares the present value of cash flows expected to be collected from the security with the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis for the security, a credit loss exists and an allowance for credit losses is recorded, limited to the amount that the fair value of the security is less than its amortized cost basis. Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income (loss), net of applicable taxes. No allowance for credit losses for available-for-sale debt securities was needed at June 30, 2023. Accrued interest receivable on available-for-sale debt securities is excluded from the estimate of credit losses. As of June 30, 2023, gross unrealized gains on the securities available-for-sale portfolio totaled approximately $488,000 and gross unrealized losses totaled approximately $315,180,000. The net amount of these two items, net of applicable taxes, is included in accumulated other comprehensive income (loss).

Equity securities that do not have readily determinable fair values are carried at cost, less impairment with observable price changes being recognized in earnings.  

45

Income Tax Expense

Income tax expense involves estimates related to the valuation allowance on deferred tax assets and loss contingencies related to exposure from tax examinations presumed to occur.

A valuation allowance reduces deferred tax assets to the amount management believes is more likely than not to be realized. In evaluating the realization of deferred tax assets, management considers the likelihood that sufficient taxable income of appropriate character will be generated within carry-back and carry-forward periods, including consideration of available tax planning strategies. Tax-related loss contingencies, including assessments arising from tax examinations and tax strategies, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. In considering the likelihood of loss, management considers the nature of the contingency, the progress of any examination or related protest or appeal, the views of legal counsel and other advisors, experience of the Company or other enterprises in similar matters, if any, and management’s intended response to any assessment.

Goodwill and Other Intangible Assets

Goodwill resulting from business combinations represents the excess of the purchase price over the fair value of the net assets of businesses acquired. Goodwill resulting from business combinations is generally determined as the excess of the fair value of the consideration transferred, plus the fair value of any noncontrolling interests in the acquiree, over the fair value of the net assets acquired and liabilities assumed as of the acquisition date. Goodwill and intangible assets acquired in a purchase business combination and determined to have an indefinite useful life are not amortized, but tested for impairment at least annually. The Company has selected December 31 as the date to perform the annual impairment test. Goodwill is the only intangible asset with an indefinite life on the Company’s balance sheet. No impairment to Goodwill was indicated based on year-end testing and no triggering events occurred in 2023 causing reassessment.

Intangible assets with definite useful lives are amortized over their estimated useful lives to their estimated residual values. Other intangible assets consist of core deposit and acquired customer relationship intangible assets. They are initially measured at fair value and then are amortized over their estimated useful lives, which range from 6 to 10 years.

46

RESULTS OF OPERATIONS

Net Income:

Net income for the quarter ended June 30, 2023 totaled $22,123,000, or $0.75 per share, a decline of 7% on a per share basis compared with the second quarter 2022 net income of $23,747,000, or $0.81 per share. The decline was largely due to a decrease in net interest income totaling $1,339,000. The decline in net interest income during the second quarter of 2023 compared with the second quarter of 2022 was primarily attributable to a decline in average earning assets, driven by a reduced level of average deposits.

Net income for the six months ended June 30, 2023 totaled $42,930,000, or $1.45 per share, an increase of 31% on a per share basis compared with the first half of 2022 net income of $32,814,000, or $1.11 per share. The first six months of 2022 was significantly impacted by costs associated with the CUB acquisition, which closed effective January 1, 2022.

Net Interest Income:

The following table summarizes net interest income (on a tax-equivalent basis) for the three months ended June 30, 2023 and 2022. For tax-equivalent adjustments, an effective tax rate of 21% was used for both periods(1).

	Average Balance Sheet (Tax-equivalent basis / dollars in thousands)
	Three Months Ended  June 30, 2023						Three Months Ended  June 30, 2022
	Principal Balance		Income / Expense		Yield / Rate		Principal Balance		Income / Expense		Yield / Rate
ASSETS
Federal Funds Sold and Other Short-term Investments	$	54,228	$	660	4.88	%	$	606,488	$	1,232	0.81	%
Securities:
Taxable	916,586		5,223		2.28	%	1,025,156		5,113		2.00	%
Non-taxable	751,285		6,871		3.66	%	850,046		7,512		3.53	%
Total Loans and Leases⁽²⁾	3,787,436		52,350		5.54	%	3,649,466		40,058		4.40	%
TOTAL INTEREST EARNING ASSETS	5,509,535		65,104		4.74	%	6,131,156		53,915		3.52	%
Other Assets	570,112						552,148
Less: Allowance for Credit Losses	(44,747)						(45,335)
TOTAL ASSETS	$	6,034,900					$	6,637,969
LIABILITIES AND SHAREHOLDERS’ EQUITY
Interest-bearing Demand, Savings and Money Market Deposits	$	3,118,225	$	10,035	1.29	%	$	3,622,748	$	1,113	0.12	%
Time Deposits	546,982		3,322		2.44	%	492,453		436		0.36	%
FHLB Advances and Other Borrowings	177,146		1,899		4.30	%	145,705		1,120		3.08	%
TOTAL INTEREST-BEARING LIABILITIES	3,842,353		15,256		1.59	%	4,260,906		2,669		0.25	%
Demand Deposit Accounts	1,545,455						1,740,592
Other Liabilities	43,426						38,031
TOTAL LIABILITIES	5,431,234						6,039,529
Shareholders’ Equity	603,666						598,440
TOTAL LIBABILITIES AND     SHAREHOLDERS' EQUITY	$	6,034,900					$	6,637,969
COST OF FUNDS					1.11	%					0.17	%
NET INTEREST INCOME			$	49,848					$	51,246
NET INTEREST MARGIN					3.63	%					3.35	%

(1)Effective tax rates were determined as though interest earned on the Company’s investments in municipal bonds and loans was fully taxable.

(2)Loans held-for-sale and non-accruing loans have been included in average loans.

During the second quarter of 2023, net interest income, on a non tax-equivalent basis, totaled $48,258,000, a decline of $1,339,000, or 3%, compared to the second quarter of 2022 net interest income of $49,597,000.

The decline in net interest income during the second quarter of 2023 compared with the second quarter of 2022 was primarily attributable to a decline in average earning assets, driven by a reduced level of average deposits, which was partially mitigated by an improved net interest margin resulting from the rise in market interest rates.

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The tax equivalent net interest margin for the quarter ended June 30, 2023 was 3.63% compared with 3.35% in the second quarter of 2022. The improvement in the net interest margin during the second quarter of 2023 compared with the second quarter of 2022 was largely attributable to increased market interest rates resulting in improved yields on earning assets that outpaced increased cost of funds over the course of the past year.

The Company's net interest margin and net interest income have been impacted by accretion of loan discounts on acquired loans. Accretion of discounts on acquired loans totaled $716,000 during the second quarter of 2023 and $1,528,000 during the second quarter of 2022. Accretion of loan discounts on acquired loans contributed approximately 5 basis points to the net interest margin in the second quarter of 2023 and 10 basis points in the second quarter of 2022.

The following table summarizes net interest income (on a tax-equivalent basis) for the six months ended June 30, 2023 and 2022. For tax-equivalent adjustments, an effective tax rate of 21% was used for both periods(1).

	Average Balance Sheet (Tax-equivalent basis / dollars in thousands)
	Six Months Ended  June 30, 2023						Six Months Ended  June 30, 2022
	Principal Balance		Income / Expense		Yield / Rate		Principal Balance		Income / Expense		Yield / Rate
ASSETS
Federal Funds Sold and Other     Short-term Investments	$	50,499	$	1,005	4.01	%	$	600,727	$	1,512	0.51	%
Securities:
Taxable	932,999		10,619		2.28	%	1,046,326		9,633		1.84	%
Non-taxable	765,362		14,070		3.68	%	884,425		14,524		3.28	%
Total Loans and Leases⁽²⁾	3,780,650		101,596		5.42	%	3,658,225		79,080		4.36	%
TOTAL INTEREST EARNING ASSETS	5,529,510		127,290		4.64	%	6,189,703		104,749		3.40	%
Other Assets	571,557						544,998
Less: Allowance for Credit Losses	(44,674)						(46,013)
TOTAL ASSETS	$	6,056,393					$	6,688,688
LIABILITIES AND SHAREHOLDERS’ EQUITY
Interest-bearing Demand, Savings     and Money Market Deposits	$	3,119,097	$	17,449	1.13	%	$	3,558,139	$	1,984	0.11	%
Time Deposits	499,576		4,879		1.97	%	510,353		894		0.35	%
FHLB Advances and Other Borrowings	210,709		4,408		4.22	%	164,986		2,158		2.64	%
TOTAL INTEREST-BEARING LIABILITIES	3,829,382		26,736		1.41	%	4,233,478		5,036		0.24	%
Demand Deposit Accounts	1,590,544						1,739,975
Other Liabilities	45,284						44,657
TOTAL LIABILITIES	5,465,210						6,018,110
Shareholders’ Equity	591,183						670,578
TOTAL LIBABILITIES AND     SHAREHOLDERS' EQUITY	$	6,056,393					$	6,688,688
COST OF FUNDS					0.98	%					0.16	%
NET INTEREST INCOME			$	100,554					$	99,713
NET INTEREST MARGIN					3.66	%					3.24	%

(1)Effective tax rates were determined as though interest earned on the Company’s investments in municipal bonds and loans was fully taxable.

(2)Loans held-for-sale and non-accruing loans have been included in average loans.

48

During the first half of 2023, net interest income, on a non tax-equivalent basis, totaled $97,267,000, an increase of $762,000, or 1%, compared to the first half of 2022 net interest income of $96,505,000. The increase in net interest income during the first half of 2023 compared with the same period of 2022 was primarily the result of an improved net interest margin resulting from the rise in market interest rates. The improvement in net interest income in the first half of 2023 was also impacted by a decline in average earning assets driven by a reduced level of average deposits.

Provision for Credit Losses:

The Company provides for credit losses through regular provisions to the allowance for credit losses. The provision is affected by net charge-offs on loans and changes in specific and general allocations of the allowance. During the quarter ended June 30, 2023, the Company recorded a provision for credit losses of $550,000 compared with a provision for credit losses of $300,000 during the second quarter of 2022.

During the six months ended June 30, 2023, the Company recorded a provision for credit losses of $1,650,000 compared with a provision for credit losses of $5,500,000 for the first half of 2022. During the first six months of 2022, the provision for credit losses included $6,300,000 for the Day 1 CECL addition to the allowance for credit loss related to the CUB acquisition.

Net charge-offs totaled $599,000, or 6 basis points, on an annualized basis, of average loans outstanding during the second quarter of 2023 compared with $347,000, or 4 basis points of average loans during the second quarter of 2022. Net charge-offs totaled $1,552,000, or 8 basis points, on an annualized basis, of average loans outstanding during the six months ended June 30, 2023 compared with $603,000, or 3 basis points, on an annualized basis, of average loans outstanding during the same period of 2022.

The provision for credit losses made during the three and six months ended June 30, 2023 was made at a level deemed necessary by management to absorb expected losses in the loan portfolio. A detailed evaluation of the adequacy of the allowance for credit losses is completed quarterly by management, the results of which are used to determine provision for credit losses. Management estimates the allowance balance required using past loan loss experience, the nature and volume of the portfolio, information about specific borrower situations and estimated collateral values, economic conditions and reasonable and supportable forecasts along with other qualitative and quantitative factors.

Non-interest Income:

During the quarter ended June 30, 2023, non-interest income totaled $14,896,000, a decline of $284,000, or 2%, compared with the second quarter of 2022. The decrease in non-interest income during the second quarter of 2023 compared to the second quarter of 2022 was in large part attributable to lower gains on sales of loans and lower company owned life insurance proceeds, which were partially offset by increased wealth management fees and interchange fee income.

Non-interest Income (dollars in thousands)	Three Months Ended  June 30,				Change From Prior Period
					Amount		Percent
	2023		2022		Change		Change
Wealth Management Fees	$	2,912	$	2,642	$	270	10	%
Service Charges on Deposit Accounts	2,883		2,871		12		—
Insurance Revenues	2,130		2,254		(124)		(6)
Company Owned Life Insurance	429		894		(465)		(52)
Interchange Fee Income	4,412		4,167		245		6
Other Operating Income	1,462		1,225		237		19
Subtotal	14,228		14,053		175		1
Net Gains on Sales of Loans	630		1,049		(419)		(40)
Net Gains on Securities	38		78		(40)		(51)
Total Non-interest Income	$	14,896	$	15,180	$	(284)	(2)

Wealth management fees increased $270,000, or 10%, during the second quarter of 2023 compared with the second quarter of 2022. The increase during the second quarter of 2023 was largely attributable to increased assets under management within the Company's wealth management group as compared with the second quarter of 2022.

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Company owned life insurance decreased $465,000, or 52%, during the second quarter of 2023 compared with the second quarter of 2022. The decline in the second quarter of 2023 was primarily the result of a decrease in the death benefit claims received compared with the second quarter of 2022.

Interchange fee income increased $245,000, or 6%, during the three months ended June 30, 2023 compared with the second quarter of 2022. The increase in the level of fees during the second quarter of 2023 compared with the second quarter of 2022 was due to increased card utilization by customers.

Other operating income increased $237,000, or 19%, during the second quarter of 2023 compared with the second quarter of 2022. The increase during the second quarter of 2023 compared with the second quarter of 2022 was largely attributable to fees associated with interest rate swap transactions with loan customers.

Net gains on sales of loans declined $419,000, or 40%, during the second quarter of 2023 compared with the second quarter of 2022. The decline in the second quarter of 2023 compared with the second quarter of 2022 was largely related to a lower volume of loans sold and lower pricing levels. Loan sales totaled $24.8 million during the second quarter of 2023 compared with $52.5 million during the second quarter of 2022.

During the six months ended June 30, 2023, non-interest income totaled $29,863,000, a decline of $1,505,000, or 5%, compared with the first six months of 2022. The decline in non-interest income during the first six months of 2023 was primarily driven by reduced net gains on sales of loans.

Non-interest Income (dollars in thousands)	Six Months Ended  June 30,				Change From Prior Period
					Amount		Percent
	2023		2022		Change		Change
Wealth Management Fees	$	5,556	$	5,280	$	276	5	%
Service Charges on Deposit Accounts	5,671		5,554		117		2
Insurance Revenues	5,265		5,975		(710)		(12)
Company Owned Life Insurance	830		1,352		(522)		(39)
Interchange Fee Income	8,611		7,794		817		10
Other Operating Income	2,673		2,493		180		7
Subtotal	28,606		28,448		158		1
Net Gains on Sales of Loans	1,217		2,470		(1,253)		(51)
Net Gains on Securities	40		450		(410)		(91)
Total Non-interest Income	$	29,863	$	31,368	$	(1,505)	(5)

Wealth management fees increased $276,000, or 5%, during the first half of 2023 compared with the first half of 2022. The increase during the six months ended June 30, 2023 was largely attributable to increased assets under management within the Company's wealth management group as compared with the first half of 2022.

Insurance revenues declined $710,000, or 12%, during the first half of 2023 compared with the first half of 2022 and was primarily attributable to decreased contingency revenue. Contingency revenue during the first half of 2023 totaled $955,000 compared with $1,639,000 during the first half of 2022. Contingency revenue is reflective of claims and loss experience with insurance carriers that the Company represents through its property and casualty insurance agency. Typically, the majority of contingency revenue is recognized during the first quarter of the year.

Company owned life insurance decreased $522,000, or 39%, during the first six months of 2023 compared with the first six months of 2022. The decline in the first half of 2023 was primarily the result of a decrease in the death benefit claims received compared with the first half of 2022.

Interchange fee income increased $817,000, or 10%, during the six months ended June 30, 2023 compared with the six months ended June 30, 2022. The increase in the level of fees during the first six months of 2023 compared with the first six months of 2022 was due to increased card utilization by customers.

Net gains on sales of loans declined $1,253,000, or 51%, during the first half of 2023 compared with the first half of 2022. The decline in the first half of 2023 compared with the first half of 2022 was largely related to a lower volume of loans sold and lower pricing levels. Loan sales totaled $48.2 million during the first half of 2023 compared with $101.7 million during the first half of 2022.

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The Company realized $40,000 in gains on sales of securities during the six months ended June 30, 2023 compared with $450,000 during the six months ended June 30, 2022. The sales of securities in both periods was completed as part of modest shifts in the allocations within the securities portfolio.

Non-interest Expense:

During the quarter ended June 30, 2023, non-interest expense totaled $35,726,000, and remained relatively stable compared with the second quarter of 2022.

Non-interest Expense (dollars in thousands)	Three Months Ended  June 30,				Change From Prior Period
					Amount		Percent
	2023		2022		Change		Change
Salaries and Employee Benefits	$	20,103	$	20,384	$	(281)	(1)	%
Occupancy, Furniture and Equipment Expense	3,443		3,772		(329)		(9)
FDIC Premiums	687		465		222		48
Data Processing Fees	2,803		2,460		343		14
Professional Fees	1,614		1,573		41		3
Advertising and Promotion	1,261		1,027		234		23
Intangible Amortization	734		957		(223)		(23)
Other Operating Expenses	5,081		5,063		18		—
Total Non-interest Expense	$	35,726	$	35,701	$	25	—

Salaries and benefits declined $281,000, or 1%, during the second quarter of 2023 as compared with the second quarter of 2022. The decline in salaries and benefits during the second quarter of 2023 compared with the second quarter of 2022 was primarily due to lower incentive plan costs and lower health insurance benefit costs.

Occupancy, furniture and equipment expense declined $329,000, or 9%, during the second quarter of 2023 compared with the second quarter of 2022. The decline in the second quarter of 2023 compared with the second quarter of 2022 was largely attributable to lower repairs and maintenance costs and reduced net costs related to leased properties.

FDIC premiums increased $222,000, or 48%, during the quarter ended June 30, 2023 compared with the second quarter of 2022. The increase in the second quarter of 2023 compared with the second quarter of 2022 was primarily related to an industry-wide 2 basis point increase in the base FDIC premium assessment effective January 1, 2023.

Data processing fees increased $343,000, or 14%, during the second quarter of 2023 compared with the second quarter of 2022. The increase during the second quarter of 2023 compared with the second quarter of 2022 was largely driven by costs associated with enhancements to the Company's data processing systems.

Advertising and promotion expense increased $234,000, or 23%, in the second quarter of 2023 compared with the second quarter of 2022. The increase in the second quarter of 2023 compared with the second quarter of 2022 was primarily due to an increase in overall marketing and advertising costs.

During the six months ended June 30, 2023, non-interest expense totaled $73,342,000, a decrease of $10,519,000, or 13%, compared to the first half of 2022. The first half of 2022 non-interest expenses included approximately $12,132,000 of non-recurring acquisition-related expenses for the acquisition of CUB.

Non-interest Expense (dollars in thousands)	Six Months Ended  June 30,				Change From Prior Period
					Amount		Percent
	2023		2022		Change		Change
Salaries and Employee Benefits	$	41,949	$	43,472	$	(1,523)	(4)	%
Occupancy, Furniture and Equipment Expense	7,263		7,581		(318)		(4)
FDIC Premiums	1,428		941		487		52
Data Processing Fees	5,558		10,184		(4,626)		(45)
Professional Fees	3,176		3,936		(760)		(19)
Advertising and Promotion	2,428		2,165		263		12
Intangible Amortization	1,519		1,974		(455)		(23)
Other Operating Expenses	10,021		13,608		(3,587)		(26)
Total Non-interest Expense	$	73,342	$	83,861	$	(10,519)	(13)

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Salaries and benefits declined $1,523,000, or 4%, during the first half of 2023 compared with the first half of 2022. The decline in salaries and benefits during the first half of 2023 compared with the first half of 2022 was largely related to approximately $1,480,000 of acquisition-related salary and benefit costs of a non-recurring nature in the first half of 2022 related to the CUB acquisition.

FDIC premiums increased $487,000, or 52%, during the six months ended June 30, 2023 compared with the same period of 2022. The increase in the six months ended June 30, 2023 compared with the same period of 2022 was primarily related to an industry-wide 2 basis point increase in the base FDIC premium assessment effective January 1, 2023.

Data processing fees declined $4,626,000, or 45%, during the first half of 2023 compared with the first half of 2022. The decline during the first half of 2023 compared with the same period of 2022 was largely driven by acquisition-related costs associated with the CUB transaction, which totaled approximately $4,982,000 during the first half of 2022.

Professional fees declined $760,000, or 19%, during the first six months of 2023 compared to the first six months of 2022. The decline in the first six months of 2023 compared to the same period of 2022 was primarily due to merger-related professional fees associated with the CUB acquisition that totaled approximately $1,616,000.

Other operating expenses declined $3,587,000, or 26%, during the first half of 2023 compared to the first half of 2022. The decline in the first half of 2023 compared with the same period of 2022 was attributable to acquisition-related costs that totaled approximately $3,857,000 in the first half of 2022. The acquisition-related costs were primarily vendor contract termination costs.

Income Taxes:

The Company’s effective income tax rate was 17.6% and 17.5%, respectively, during the three months ended June 30, 2023 and 2022. The Company's effective income tax rate was 17.7% and 14.8%, respectively, during the six months ended June 30, 2023 and 2022. The lower effective tax rate during the first six months of 2022 as compared with the first six months of 2023 was the result of non-taxable sources of income being a greater component of pre-tax income. The lower level of pre-tax income in the first half of 2022 was driven in large part by acquisition costs and the Day 1 CECL provision associated with the CUB merger. The effective tax rate in all periods presented was lower than the blended statutory rate resulting primarily from the Company’s tax-exempt investment income on securities, loans and company-owned life insurance, income tax credits generated from affordable housing projects, and income generated by subsidiaries domiciled in a state with no state or local income tax.

FINANCIAL CONDITION

Total assets for the Company totaled $6.053 billion at June 30, 2023, representing a decline of $102.7 million compared with year-end 2022. The decline in total assets at June 30, 2023 compared with December 31, 2022 was largely attributable to a decline in total deposits which in turn has led to declines in the Company's securities portfolio. These declines were partially offset by an increase in total loans.

Securities available for sale declined $161.0 million as of June 30, 2023 compared with December 31, 2022. The changes in the available for sale securities portfolio during the first half of 2023 compared with year-end 2022 was largely attributable to the Company's utilization of cash flows from the securities portfolio to partially fund deposit declines and loan growth during the first six months of the year. Total cash flow generated from the portfolio totaled approximately $203.0 million during the first half of 2023, reflecting principal and interest payments as well as a modest level of securities sales. Current projections indicate approximately $150.0 million in principal and interest cash flows from the portfolio over the next twelve months with rates unchanged.

June 30, 2023 total loans increased $41.8 million, or 2% on an annualized basis, compared with December 31, 2022. The increase in the first half of the year was primarily driven by an increase in commercial real estate loans of $54.2 million, or 6% on an annualized basis, as well as an increase in retail loans of $16.9 million, or 5% on an annualized basis. Retail loans include home equity and consumer loans and residential mortgage loans. These increases were somewhat offset by a decline in agricultural loans of $21.9 million and a decline in commercial and industrial loans of $7.4 million.

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The composition of the loan portfolio has remained relatively stable and diversified over the past several years, including 2023. The portfolio is most heavily concentrated in commercial real estate loans at 53% of the portfolio, followed by commercial and industrial loans at 17% of the portfolio, and agricultural loans at 10% of the portfolio. The Company’s commercial lending is extended to various industries, including multi-family housing and lodging, agribusiness and manufacturing, as well as health care, wholesale, and retail services. The Company's commercial real estate portfolio has limited exposure to office real estate, with office exposure totaling approximately 4% of the total loan portfolio.

End of Period Loan Balances: (dollars in thousands)	June 30, 2023		December 31, 2022		Current Period Change
Commercial and Industrial Loans and Leases	$	669,137	$	676,502	$	(7,365)
Commercial Real Estate Loans	2,021,109		1,966,884		54,225
Agricultural Loans	395,466		417,413		(21,947)
Home Equity and Consumer Loans	389,440		377,164		12,276
Residential Mortgage Loans	355,329		350,682		4,647
Total Loans	$	3,830,481	$	3,788,645	$	41,836

The following table indicates the breakdown of the allowance for credit losses for the periods indicated (dollars in thousands):

	June 30, 2023		December 31, 2022
Commercial and Industrial Loans and Leases	$	13,802	$	13,958
Commercial Real Estate Loans	21,834		21,598
Agricultural Loans	3,956		4,188
Home Equity and Consumer Loans	2,364		2,196
Residential Mortgage Loans	2,310		2,228
Unallocated	—		—
Total Allowance for Credit Losses	$	44,266	$	44,168

The Company’s allowance for credit losses totaled $44.3 million at June 30, 2023 compared to $44.2 million at December 31, 2022. The allowance for credit losses represented 1.16% of period-end loans at June 30, 2023 compared with 1.17% at December 31, 2022.

The Company adopted ASU No. 2016-13, "Financial Instruments - Credit Losses (Topic 326)" ("CECL") on January 1, 2020. The Company added $9.4 million to the allowance for credit losses in conjunction with the closing of the CUB acquisition on January 1, 2022, related to the CUB loan portfolio. Of the increase in the allowance for credit losses for the CUB portfolio, $6.3 million was recorded through the provision for credit losses on "Day 1" under the CECL model for non-PCD loans. The Company also acquired $29.9 million in PCD loans for which the Company recorded a credit adjustment of $3.1 million which was included in the allowance for credit losses.

Under the CECL model, certain acquired loans continue to carry a fair value discount as well as an allowance for credit losses. As of June 30, 2023, the Company held net discounts on acquired loans of $5.0 million which included $1.9 million related to the CUB loan portfolio.

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The following is an analysis of the Company’s non-performing assets at June 30, 2023 and December 31, 2022:

Non-performing Assets: (dollars in thousands)	June 30, 2023			December 31, 2022
Non-accrual Loans	$	11,423		$	12,888
Past Due Loans (90 days or more)	1,000			1,427
Total Non-performing Loans	12,423			14,315
Other Real Estate	—			—
Total Non-performing Assets	$	12,423		$	14,315
Restructured Loans	$	—		$	—
Non-performing Loans to Total Loans	0.32		%	0.38		%
Allowance for Credit Loss to Non-performing Loans	356.32		%	308.54		%

The following table presents non-accrual loans and loans past due 90 days or more still on accrual by class of loans:

	Non-Accrual Loans				Loans Past Due 90 Days or More & Still Accruing
	June 30, 2023		December 31, 2022		June 30, 2023		December 31, 2022
Commercial and Industrial Loans and Leases	$	7,577	$	7,936	$	1,000	$	1,427
Commercial Real Estate Loans	1,178		1,950		—		—
Agricultural Loans	1,252		1,062		—		—
Home Equity Loans	503		310		—		—
Consumer Loans	137		400		—		—
Residential Mortgage Loans	776		1,230		—		—
Total	$	11,423	$	12,888	$	1,000	$	1,427

Non-performing assets totaled $12.4 million at June 30, 2023 compared to $14.3 million at December 31, 2022. Non-performing assets represented 0.21% of total assets at June 30, 2023 compared to 0.23% at year end 2022. Non-performing loans totaled $12.4 million at June 30, 2023 compared to $14.3 million at December 31, 2022. Non-performing loans represented 0.32% of total loans at June 30, 2023 compared to 0.38% at December 31, 2022.

June 30, 2023 total deposits declined $170.3 million, or 3%, compared to December 31, 2022. The overall decline in deposits slowed throughout the first quarter of 2023 and stabilized in the second quarter of 2023. Deposits declined $195.2 million during the first quarter of 2023 and increased $24.8 million during the second quarter of 2023. The core deposit base remains diverse with stable and manageable exposure to uninsured and uncollateralized deposits of approximately 21% of total deposits.

The Company has continued to see customer movement from both interest bearing and non-interest bearing transactional accounts to time deposits due primarily to the rising interest rate environment. Non-interest bearing deposits have remained relatively stable as a percent of total deposits with June 30, 2023 non-interest bearing deposits totaling 30% of total deposits compared with 32% at December 31, 2022.

A competitive market driven by rising interest rates has been a significant contributing factor to the decline in total deposits over the course of the past year. Additionally, a meaningful level of the outflow of deposits experienced was captured within the Company's wealth management group in both the first half of 2023 and over the course of the past several quarters.

End of Period Deposit Balances: (dollars in thousands)	June 30, 2023		December 31, 2022		Current Period Change
Non-interest-bearing Demand Deposits	$	1,540,564	$	1,691,804	$	(151,240)
Interest-bearing Demand, Savings, & Money Market Accounts	3,056,396		3,229,778		(173,382)
Time Deposits < $100,000	256,504		235,219		21,285
Time Deposits of $100,000 or more	326,241		193,250		132,991
Total Deposits	$	5,179,705	$	5,350,051	$	(170,346)

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June 30, 2023 total borrowings increased $23.7 million, or 12%, compared to December 31, 2022. The increase in total borrowings over the course of the second quarter of 2023 and past year has been to fund loan growth and mitigate deposit outflows.

Capital Resources:

As of June 30, 2023, shareholders’ equity increased by $44.2 million to $602.6 million compared with $558.4 million at year-end 2022. The increase in shareholders' equity was primarily attributable to an increase in retained earnings of $28.2 million due to net income of $42.9 million, which was partially offset by the payment of $14.7 million in shareholder dividends. Also increasing shareholder's equity was the increase in accumulated other comprehensive income (loss) of $14.6 million related to the increase in value of the Company’s available-for-sale securities portfolio driven by changes in market interest rates during the first six months of 2023.

Shareholders’ equity represented 10.0% of total assets at June 30, 2023 and 9.1% of total assets at December 31, 2022. Shareholders’ equity included $188.1 million of goodwill and other intangible assets at June 30, 2023 compared to $189.8 million of goodwill and other intangible assets at December 31, 2022.

On January 31, 2022, the Company’s Board of Directors approved a plan to repurchase up to 1.0 million shares of the Company’s outstanding common stock. On a share basis, the amount of common stock subject to the repurchase plan represented approximately 3% of the Company’s outstanding shares on the date it was approved. The Company is not obligated to purchase any shares under the plan, and the plan may be discontinued at any time. The actual timing, number and share price of shares purchased under the repurchase plan will be determined by the Company at its discretion and will depend upon such factors as the market price of the stock, general market and economic conditions and applicable legal requirements. The Company has not repurchased any shares of common stock under the repurchase plan.

Federal banking regulations provide guidelines for determining the capital adequacy of bank holding companies and banks. These guidelines provide for a more narrow definition of core capital and assign a measure of risk to the various categories of assets. The Company is required to maintain minimum levels of capital in proportion to total risk-weighted assets and off-balance sheet exposures. 

The current risk-based capital rules, as adopted by federal banking regulators, are based upon guidelines developed by the Basel Committee on Banking Supervision and reflect various requirements of the Dodd-Frank Act (the “Basel III Rules”). The Basel III Rules require banking organizations to, among other things, maintain a minimum ratio of Total Capital to risk-weighted assets, a minimum ratio of Tier 1 Capital to risk-weighted assets, a minimum ratio of “Common Equity Tier 1 Capital” to risk-weighted assets, and a minimum leverage ratio (calculated as the ratio of Tier 1 Capital to adjusted average consolidated assets). In addition, under the Basel III Rules, in order to avoid limitations on capital distributions, including dividend payments, the Company is required to maintain a 2.5% capital conservation buffer above the adequately capitalized regulatory capital ratios. At June 30, 2023, the capital levels for the Company and its subsidiary bank remained well in excess of the minimum amounts needed for capital adequacy purposes and the Bank's capital levels met the necessary requirements to be considered well-capitalized.

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The table below presents the Company’s consolidated and the subsidiary bank's capital ratios under regulatory guidelines:

	6/30/2023 Ratio		12/31/2022 Ratio		Minimum for Capital Adequacy Purposes ⁽¹⁾		Well-Capitalized Guidelines
Total Capital (to Risk Weighted Assets)
Consolidated	16.06	%	15.45	%	8.00	%	N/A
Bank	14.50	%	14.07	%	8.00	%	10.00	%
Tier 1 (Core) Capital (to Risk Weighted Assets)
Consolidated	14.50	%	13.97	%	6.00	%	N/A
Bank	13.76	%	13.42	%	6.00	%	8.00	%
Common Tier 1 (CET 1) Capital Ratio  (to Risk Weighted Assets)
Consolidated	13.78	%	13.26	%	4.50	%	N/A
Bank	13.76	%	13.42	%	4.50	%	6.50	%
Tier 1 Capital (to Average Assets)
Consolidated	11.44	%	10.50	%	4.00	%	N/A
Bank	10.87	%	10.09	%	4.00	%	5.00	%

(1) Excludes capital conservation buffer.

In December 2018, the federal banking regulators approved a final rule to address changes to credit loss accounting under GAAP, including banking organizations’ implementation of CECL. The final rule provides banking organizations the option to phase in over a three-year period the day-one adverse effects on regulatory capital that may result from the adoption of the new accounting standard. On March 27, 2020, in an action related to the CARES Act, the federal banking regulators announced an interim final rule to delay the estimated impact on regulatory capital stemming from the implementation of CECL. The interim final rule, which was finalized effective September 30, 2020, maintained the three-year transition option in the previous rule and provides banks the option to delay for two years an estimate of CECL’s effect on regulatory capital, relative to the incurred loss methodology’s effect on regulatory capital, followed by a three-year transition period (five-year transition option). The Company elected to adopt the five-year transition option and, as a result, began the required three-year phase-in by reflecting 25% of the previously deferred estimated capital impact of CECL in its regulatory capital effective January 1, 2022. An additional 25% was phased in on January 1, 2023 and another 25% will be phased in on each of January 1, 2024 and January 1, 2025 (at which time the cumulative effects of adopting CECL will have been fully phased into our regulatory capital). Under the five-year transition option, the amount of adjustments to regulatory capital that could be deferred until the phase-in period began included both the initial impact of our adoption of CECL at January 1, 2020 and 25% of subsequent changes in our allowance for credit losses during each quarter of the two-year period ended December 31, 2021.

Liquidity:

The Consolidated Statement of Cash Flows details the elements of changes in the Company’s consolidated cash and cash equivalents. Total cash and cash equivalents increased $21.6 million during the six months ended June 30, 2023 ending at $140.7 million.  During the six months ended June 30, 2023, operating activities resulted in net cash inflows of $53.2 million. Investing activities resulted in net cash inflows of $129.8 million during the six months ended June 30, 2023. Financing activities resulted in net cash outflows for the six months ended June 30, 2023 of $161.4 million.

The Company’s primary source of funding is its customer deposits, supplemented by brokered deposits, overnight borrowings from other financial institutions, and securities sold under agreements to repurchase. The membership of the Company’s affiliate bank in the Federal Home Loan Bank System provides a significant additional source for both long and short-term collateralized borrowings. In addition, in March 2023, the FRB created the Bank Term Funding Program, a new facility established in response to recent liquidity concerns within the banking industry in part due to recent deposit runs that resulted in a few large bank failures. The program was designed to provide available additional funding to eligible depository institutions in order to help assure that banks have the ability to meet the needs of all their depositors. Under the program, eligible depository institutions can obtain loans of up to one year in length by pledging U.S. Treasuries, agency debt and mortgage-backed securities, and other qualifying assets as collateral. These assets will be valued at par. The program is intended to eliminate the need for depository institutions to quickly sell their securities when they are experiencing stress on their liquidity. As of the date of this Quarterly Report on Form 10-Q, the Company has not made any requests for loans under the program.

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The parent company is a corporation separate and distinct from its bank and other subsidiaries. The Company uses funds at the parent-company level to pay dividends to its shareholders, to acquire or make other investments in other businesses or their securities or assets, to repurchase its stock from time to time, and for other general corporate purposes including debt service. The parent company does not have access at the parent-company level to the deposits and certain other sources of funds that are available to its bank subsidiary to support its operations. Instead, the parent company has historically derived most of its revenues from dividends paid to the parent company by its bank subsidiary. The Company’s banking subsidiary is subject to statutory restrictions on its ability to pay dividends to the parent company. The parent company has in recent years supplemented the dividends received from its subsidiaries with borrowings. As of June 30, 2023, the parent company had approximately $55.0 million of cash and cash equivalents available to meet its cash flow needs.

FORWARD-LOOKING STATEMENTS AND ASSOCIATED RISKS

The Company from time to time in its oral and written communications makes statements relating to its expectations regarding the future. These types of statements are considered “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. The Company may include forward-looking statements in filings with the Securities and Exchange Commission (“SEC”), such as this Form 10-Q, in other written materials, and in oral statements made by senior management to analysts, investors, representatives of the media, and others. Such forward looking statements can include statements about the Company’s net interest income or net interest margin; its adequacy of allowance for credit losses, levels of provisions for credit losses, and the quality of the Company’s loans, investment securities and other assets; simulations of changes in interest rates; expected results from mergers with or acquisitions of other businesses; litigation results; tax estimates and recognition; dividend policy; parent company cash resources and cash requirements, and parent company capital resources; estimated cost savings, plans and objectives for future operations; and expectations about the Company’s financial and business performance and other business matters as well as economic and market conditions and trends. They often can be identified by the use of words like “plan,” “expect,” “can,” “might,” “may,” “will,” “would,” “could,” “should,” “intend,” “project,” “estimate,” “believe” or “anticipate,” or similar expressions.

Forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the forward-looking statement is made.

Readers are cautioned that, by their nature, all forward-looking statements are based on assumptions and are subject to risks, uncertainties, and other factors. Actual results may differ materially and adversely from the expectations of the Company that are expressed or implied by any forward-looking statement. The discussions in this Item 2 list some of the factors that could cause the Company’s actual results to vary materially from those expressed or implied by any forward-looking statements. Other risks, uncertainties, and factors that could cause the Company’s actual results to vary materially from those expressed or implied by any forward-looking statement include:

•changes in interest rates and the timing and magnitude of any such changes;

•unfavorable economic conditions, including a prolonged period of inflation, and the resulting adverse impact on, among other things, credit quality;

•the impacts related to or resulting from recent bank failures or adverse developments at other banks on general investor sentiment regarding the stability and liquidity of banks;

•the impacts of epidemics, pandemics or other infectious disease outbreaks;

•changes in competitive conditions;

•the introduction, withdrawal, success and timing of asset/liability management strategies or of mergers and acquisitions and other business initiatives and strategies;

•changes in customer borrowing, repayment, investment and deposit practices;

•changes in fiscal, monetary and tax policies;

•changes in financial and capital markets;

•capital management activities, including possible future sales of new securities, or possible repurchases or redemptions by the Company of outstanding debt or equity securities;

•risks of expansion through acquisitions and mergers, such as unexpected credit quality problems of the acquired loans or other assets, unexpected attrition of the customer base or employee base of the acquired institution or branches, and difficulties in integration of the acquired operations;

•factors driving impairment charges on investments;

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•the impact, extent and timing of technological changes;

•potential cyber-attacks, information security breaches and other criminal activities;

•litigation liabilities, including related costs, expenses, settlements and judgments, or the outcome of matters before regulatory agencies, whether pending or commencing in the future;

•actions of the Federal Reserve Board;

•the possible effects of the replacement of the London Interbank Offered Rate (LIBOR);

•the potential for increases to, and volatility in, the balance of our allowance for credit losses and related provision expense due to the current expected credit loss (CECL) standard;

•changes in accounting principles and interpretations;

•potential increases of federal deposit insurance premium expense, and possible future special assessments of FDIC premiums, either industry wide or specific to the Company’s banking subsidiary;

•actions of the regulatory authorities under the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) and the Federal Deposit Insurance Act and other possible legislative and regulatory actions and reforms;

•impacts resulting from possible amendments or revisions to the Dodd-Frank Act and the regulations promulgated thereunder, or to Consumer Financial Protection Bureau rules and regulations; and

•the continued availability of earnings and excess capital sufficient for the lawful and prudent declaration and payment of cash dividends.

Such statements reflect our views with respect to future events and are subject to these and other risks, uncertainties and assumptions relating to the operations, results of operations, growth strategy and liquidity of the Company. Readers are cautioned not to place undue reliance on these forward-looking statements.

Investors should consider these risks, uncertainties, and other factors, in addition to those mentioned by the Company in its Annual Report on Form 10-K for its fiscal year ended December 31, 2022, this Quarterly Report on Form 10-Q, and other SEC filings from time to time, when considering any forward-looking statement.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

The Company’s exposure to market risk is reviewed on a regular basis by the Asset/Liability Committee and Boards of Directors of the parent company and its subsidiary bank. Primary market risks which impact the Company’s operations are liquidity risk and interest rate risk.

The liquidity of the parent company is dependent upon the receipt of dividends from its subsidiary bank, which is subject to certain regulatory limitations. The Bank’s source of funding is predominately core deposits, maturities of securities, repayments of loan principal and interest, federal funds purchased, securities sold under agreements to repurchase, and borrowings from the Federal Home Loan Bank and the Federal Reserve Bank.

The Company monitors interest rate risk by the use of computer simulation modeling to estimate the potential impact on its net interest income under various interest rate scenarios, and by estimating its static interest rate sensitivity position. Another method by which the Company’s interest rate risk position can be estimated is by computing estimated changes in its net portfolio value (“NPV”). This method estimates interest rate risk exposure from movements in interest rates by using interest rate sensitivity analysis to determine the change in the NPV of discounted cash flows from assets and liabilities. NPV represents the market value of portfolio equity and is equal to the estimated market value of assets minus the estimated market value of liabilities.

Computations for measuring both net interest income and NPV are based on a number of assumptions, including the relative levels of market interest rates and prepayments in mortgage loans and certain types of investments. These computations do not contemplate any actions management may undertake in response to changes in interest rates, and should not be relied upon as indicative of actual results. In addition, certain shortcomings are inherent in the method of computing both net interest income and NPV. Should interest rates remain or decrease below current levels, the proportion of adjustable rate loans could decrease in future periods due to refinancing activity. In the event of an interest rate change, prepayment levels would likely be different from those assumed in the modeling. Lastly, the ability of many borrowers to repay their adjustable rate debt may decline during a rising interest rate environment.

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The Company from time to time utilizes derivatives to manage interest rate risk. Management continuously evaluates the merits of such interest rate risk products but does not anticipate the use of such products to become a major part of the Company’s risk management strategy.

The table below provides an assessment of the risk to net interest income over the next 12 months in the event of a sudden and sustained 1% and 2% increase and decrease in prevailing interest rates (dollars in thousands).

Interest Rate Sensitivity as of June 30, 2023 - Net Interest Income

	Net Interest Income
Changes in Rates	Amount		% Change
+2%	$	205,043	0.66	%
+1%	204,551		0.41	%
Base	203,707		—
-1%	201,092		(1.28)	%
-2%	196,665		(3.46)	%

The above table is a measurement of the Company’s net interest income at risk, assuming a static balance sheet as of June 30, 2023 and instantaneous parallel changes in interest rates. The Company also monitors interest rate risk under other scenarios including a more gradual movement in market interest rates. This type of scenario can at times produce different modeling results in measuring interest rate risk sensitivity.

The table below provides an assessment of the risk to NPV in the event of a sudden and sustained 1% and 2% increase and decrease in prevailing interest rates (dollars in thousands).

Interest Rate Sensitivity as of June 30, 2023 - Net Portfolio Value

	Net Portfolio Value				Net Portfolio Value as a % of Present Value of Assets
Changes in Rates	Amount		% Change		NPV Ratio		Change
+2%	$	681,568	(10.39)	%	12.83	%	(58) b.p.
+1%	720,451		(5.27)	%	13.13	%	(28) b.p.
Base	760,566		—		13.41	%	—
-1%	795,145		4.55	%	13.55	%	14 b.p.
-2%	814,894		7.14	%	13.45	%	4 b.p.

This Item 3 includes forward-looking statements. See “Forward-looking Statements and Associated Risks” included in Part I, Item 2 of this Report for a discussion of certain factors that could cause the Company’s actual exposure to market risk to vary materially from that expressed or implied above. These factors include possible changes in economic conditions; interest rate fluctuations, competitive product and pricing pressures within the Company’s markets; and equity and fixed income market fluctuations. Actual experience may also vary materially to the extent that the Company’s assumptions described above prove to be inaccurate.

59

Item 4.  Controls and Procedures

As of June 30, 2023, the Company carried out an evaluation, under the supervision and with the participation of its principal executive officer and principal financial officer, of the effectiveness of the design and operation of its disclosure controls and procedures. Based on this evaluation, the Company’s principal executive officer and principal financial officer concluded that the Company’s disclosure controls and procedures were, as of that date, effective in timely alerting them to material information required to be included in the Company’s periodic reports filed with the Securities and Exchange Commission. There are inherent limitations to the effectiveness of systems of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective systems of disclosure controls and procedures can provide only reasonable assurances of achieving their control objectives.

There was no change in the Company’s internal control over financial reporting that occurred during the Company’s second fiscal quarter of 2023 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

60

PART II. OTHER INFORMATION

Item 1.   Legal Proceedings

There are no pending legal proceedings, other than routine litigation incidental to the business of the Company’s subsidiaries, to which the Company or any of its subsidiaries is a party or of which any of their property is the subject.

Item 1A.  Risk Factors

Except for the additional risk factors set forth below, there have been no material changes to the risk factors previously disclosed in German American Bancorp, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2022.

Adverse developments affecting the financial services industry, such as recent bank failures or concerns involving liquidity, may have a material effect on our operations.

The failures of Silicon Valley Bank and Signature Bank in March 2023, followed by the failure of First Republic Bank in May 2023, have resulted in general uncertainty for the financial services industry and have caused concerns relative to the adequacy of liquidity in the banking sector as a whole. A financial institution’s liquidity reflects its ability to meet customer demand for loans, accommodating possible outflows in deposits and accessing alternative sources of funds when needed, while at the same time taking advantage of interest rate market opportunities. The ability to manage liquidity is fundamental to a financial institution’s business and success. The recent bank failures highlight the potential results of an insured depository institution unexpectedly having to obtain needed liquidity to satisfy deposit withdrawal requests, including how quickly such requests can accelerate once uninsured depositors lose confidence in an institutions ability to satisfy its obligations to depositors. Current market uncertainties and other external factors may impact the competitive landscape for deposits in the banking industry in an unpredictable manner. In addition, the rising interest rate environment has continued to increase competition for liquidity and the premium at which liquidity is available to meet funding needs. These possible impacts may adversely affect our future operating results, including net income, and negatively impact capital.

Regulatory requirements arising from recent events in the financial services industry, or the application of current regulations, could increase our expenses and affect our operations.

We anticipate the potential of new regulations for banks of similar size to the Company’s banking subsidiary, German American Bank, designed to address the recent developments in the financial services industry, which may increase our costs of doing business and reduce our profitability. Among other things, there may be an increased focus by both regulators and investors on deposit composition and the level of uninsured deposits. We also expect that another result of the recent bank failures, as well as any future bank failures, will be an increase to our FDIC insurance premiums in future years, further increasing our cost of doing business.

61

Item 2.   Unregistered Sales of Equity Securities and Use of Proceeds

Issuer Purchases of Equity Securities

The following table sets forth information regarding the Company’s purchases of its common shares during each of the three months ended June 30, 2023.

Period	Total Number of Shares (or Units) Purchased	Average Price Paid Per Share (or Unit)	Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs (1)	Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased under the Plans or Programs (1)
April 2023	—	—	—	1,000,000
May 2023	—	—	—	1,000,000
June 2023	—	—	—	1,000,000
Total	—	—	—

(1) On January 31, 2022, the Company’s Board of Directors approved a plan to repurchase up to 1.0 million shares of the Company’s outstanding common stock. On a share basis, the amount of common stock subject to the repurchase plan represented approximately 3% of the Company’s outstanding shares on the date it was approved. The Company is not obligated to purchase any shares under the plan, and the plan may be discontinued at any time. The actual timing, number and share price of shares purchased under the repurchase plan will be determined by the Company at its discretion and will depend upon such factors as the market price of the stock, general market and economic conditions and applicable legal requirements. The Company has not repurchased any shares under the 2022 repurchase plan.

Item 3.   Defaults Upon Senior Securities

None.

Item 4.   Mine Safety Disclosures

Not applicable.

Item 5.   Other Information

(a) Information required to be disclosed in a report on Form 8-K.

None.

(b) Changes to director nomination procedures.

None.

(c) Insider trading arrangements.

During the three months ended June 30, 2023, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

62

Item 6.      Exhibits

The following exhibits are included with this Report or incorporated herein by reference.

Exhibit No.	Description
3.1	Amended and Restated Articles of Incorporation of German American Bancorp, Inc., are incorporated by reference to Exhibit 3.1 of the Registrant’s Current Report on Form 8-K filed May 26, 2020 (SEC File No. 001-15877).
3.2	Amended and Restated Bylaws of German American Bancorp, Inc. are incorporated by reference to Exhibit 3.1 of the Registrant's Current Report on Form 8-K filed July 1, 2020 (SEC File No. 001-15877).
4.1	Terms of Common Shares and Preferred Shares of the Registrant (included in Restatement of Articles of Incorporation) are incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K filed May 26, 2020 (SEC File No. 001-15877).
4.2	Specimen stock certificate for Common Shares of the Registrant is incorporated by reference to Exhibit 99.1 to the Registrant's Current Report on Form 8-K filed October 21, 2010 (SEC File No. 001-15877).
4.3	Indenture, dated as of June 25, 2019, by and between German American Bancorp, Inc. and U.S. Bank National Association, as trustee, is incorporated by reference to Exhibit 4.1 of the Registrant’s Current Report on Form 8-K filed June 25, 2019 (SEC File No. 001-15877).
4.4	Form of 4.50% Fixed-to-Floating Subordinated Note due 2029 of German American Bancorp, Inc. is incorporated by reference to Exhibit 4.2 of the Registrant’s Current Report on Form 8-K filed June 25, 2019 (SEC File No. 001-15877).
10.1*+	Description of Director Compensation Arrangements, effective as of July 1, 2023.
31.1+	Sarbanes-Oxley Act of 2002, Section 302 Certification of Principal Executive Officer.
31.2+	Sarbanes-Oxley Act of 2002, Section 302 Certification of Principal Financial Officer.
32.1++	Sarbanes-Oxley Act of 2002, Section 906 Certification of Principal Executive Officer.
32.2++	Sarbanes-Oxley Act of 2002, Section 906 Certification of Principal Financial Officer.
101.INS+	Inline XBRL Instance Document (The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.)
101.SCH+	Inline XBRL Taxonomy Extension Schema Document
101.CAL+	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF+	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB+	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE+	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

Note: No long-term debt instrument issued by the Registrant exceeds 10% of consolidated total assets or is registered. In accordance with paragraph 4 (iii) of Item 601(b) of Regulation S-K, the Registrant will furnish the Securities and Exchange Commission copies of long-term debt instruments and related agreements upon request.

* Exhibits that describe or evidence management contracts or compensatory plans or arrangements required to be filed as exhibits to this Report are indicated by an asterisk.

+Filed with this Report (other than through incorporation by reference to other disclosures or exhibits).

++Furnished with this Report.

63

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.

	GERMAN AMERICAN BANCORP, INC.
Date: August 7, 2023	By: /s/D. Neil Dauby
	D. Neil Dauby
	Chairman and Chief Executive Officer
	(Principal Executive Officer)
Date: August 7, 2023	By: /s/Bradley M. Rust
	Bradley M. Rust
	President and Chief Financial Officer
	(Principal Financial Officer)
Date: August 7, 2023	By: /s/Vicki L. Schuler
	Vicki L. Schuler
	Senior Vice President, Controller
	(Principal Accounting Officer)

64

EX-10.1

Exhibit 10.1

German American Bancorp, Inc.

Director Compensation Arrangements

Effective July 1, 2023

German American Bancorp, Inc. (the “Company”) compensates the non-employee members of its Board of Directors (the “Board”) for their service to the Company and the Company’s subsidiaries based on a twelve-month period commencing July 1 and ending on June 30 of the following year.

Following a recommendation made by the Board’s Governance/Nominating Committee, the Board has approved a $25,000 annual cash retainer for the services of each non-employee director, plus, in the case of the lead independent director of the Board and certain Board committee chairs, a supplemental cash retainer in the amounts described below. The cash retainers are deemed earned immediately upon receipt by a director, regardless of the number of meetings actually held or attended during the new service period.

The supplemental annual cash retainers to be paid for leadership roles include: (a) $25,000 to the Board’s lead independent director; (b) $10,000 to the Chair of the Board’s Audit Committee; (c) $5,000 to the Chair of the Board’s Governance/Nominating Committee; (d) $7,500 to the Chair of the Board’s Compensation/Human Resources Committee; (e) $7,500 to the Chair of the Board’s Credit Risk Management Committee; and (f) $3,000 to the Chair of the Company’s Finance & Asset/Liability Management Committee.

In addition, the Company will pay to each non-employee director an attendance fee of $850 for each Board committee meeting that he or she attends during the service period and, to the extent applicable, an additional (a) $850 for each meeting that he or she attends of the board of directors of (i) German American Bank (the Company’s bank subsidiary) or any committee or regional advisory board thereof, and (ii) German American Insurance, Inc., and (b) $425 for each meeting that he or she attends of (i) the board of directors of German American Investment Services, Inc., and (ii) the Wealth Advisory (Trust) Oversight Committee. Members of the Board who attend a session of any Board committee that is held concurrently with a session of any other Board committee or of a committee of the board of directors of the Company’s bank subsidiary (German American Bank) will receive a single meeting fee of $850 for the combination of the concurrent meetings.

Additionally, those non-employee directors who travel from their primary residence or principal place of business, which is located outside of Dubois County, Indiana or the Indiana counties immediately adjacent to Dubois County, will be paid a $50 travel allowance in connection with his/her in-person attendance at board or assigned committee meetings.

Finally, the Board will consider, at its regular meeting to be held in December, the award of additional retainers in the form of grants (under the Company’s 2019 Long-Term Equity Incentive Plan) of restricted common stock of the Company to the non-employee directors with a market value of not more than $40,000 per director. The Board decision to be made in December as to whether to grant such additional retainers in the form of restricted stock (and if so, how much) should be determined at that time based on the Board’s perception of prevailing financial conditions (including the Company’s then-expected operating results for the current fiscal year) and such other factors as the Board may then deem relevant. Each grant of restricted stock, if and when granted and issued, would not be transferable prior to the one-year anniversary of the grant date, and would be fully forfeited were a director not to continue in service as a director of the Company through such one-year anniversary, for any reason other than death or disability, and would be subject to a 50% forfeiture (for any reason other than disability) should a director fail to attend in person a certain percentage of meetings of the boards and committees on which he or she was a member during the annual period commencing on January 1 of the following year, or fail to attend (other than by reason of disability, illness or bona fide emergency) the Company’s Annual Meeting of Shareholders held in such year. Notwithstanding the foregoing, in any award resolution, the Board may specify (in lieu of the one-year anniversary date specified above) the date of the upcoming Annual Meeting of Shareholders as the date for measuring vesting of the restricted stock award for any director who will not be standing for re-election at such Annual Meeting as a result of reaching the retirement age set forth in the Company’s Bylaws or otherwise electing early retirement from the Board.

23035300.v1

EX-31.1

Exhibit 31.1

Sarbanes-Oxley Act of 2002, Section 302 Certification of Principal Executive Officer

I, D. Neil Dauby, Chairman and Chief Executive Officer of German American Bancorp, Inc., certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of German American Bancorp, Inc. (the “registrant”):

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

August 7, 2023

Date

/s/ D. Neil Dauby

D. Neil Dauby

Chairman and Chief Executive Officer

(Principal Executive Officer)

EX-31.2

Exhibit 31.2

Sarbanes-Oxley Act of 2002, Section 302 Certification of Principal Financial Officer

I, Bradley M. Rust, President and Chief Financial Officer of German American Bancorp, Inc. certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of German American Bancorp, Inc. (the “registrant”):

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

August 7, 2023

Date

/s/ Bradley M. Rust

Bradley M. Rust

President and Chief Financial Officer

(Principal Financial Officer)

EX-32.1

Exhibit 32.1

Sarbanes-Oxley Act of 2002, Section 906 Certification of Principal Executive Officer

I, D. Neil Dauby, Chairman and Chief Executive Officer of German American Bancorp, Inc. certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350), that:

1.The Quarterly Report on Form 10-Q for the quarter ended June 30, 2023 (the “Periodic Report”), which this statement accompanies, fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and

2.Information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of German American Bancorp, Inc.

This certificate is being furnished solely for purposes of Section 906 and is not being filed as part of the Periodic Report.

August 7, 2023

Date

/s/ D. Neil Dauby

D. Neil Dauby

Chairman and Chief Executive Officer

(Principal Executive Officer)

EX-32.2

Exhibit 32.2

Sarbanes-Oxley Act of 2002, Section 906 Certification of Principal Financial Officer

I, Bradley M. Rust, President and Chief Financial Officer of German American Bancorp, Inc. certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350), that:

1.The Quarterly Report on Form 10-Q for the quarter ended June 30, 2023 (the “Periodic Report”), which this statement accompanies, fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and

2.Information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of German American Bancorp, Inc.

This certificate is being furnished solely for purposes of Section 906 and is not being filed as part of the Periodic Report.

August 7, 2023

Date

/s/ Bradley M. Rust

Bradley M. Rust

President and Chief Financial Officer

(Principal Financial Officer)

XML

Cover - shares	6 Months Ended
	Jun. 30, 2023	Aug. 01, 2023
Cover [Abstract]
Document Type	10-Q
Document Period End Date	Jun. 30, 2023
Entity File Number	001-15877
Entity Registrant Name	German American Bancorp, Inc.
Entity Incorporation, State or Country Code	IN
Entity Tax Identification Number	35-1547518
Entity Address, Address Line One	711 Main Street
Entity Address, City or Town	Jasper
Entity Address, State or Province	IN
Entity Address, Postal Zip Code	47546
City Area Code	812
Local Phone Number	482-1314
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Title of 12(b) Security	Common Stock, no par value
Trading Symbol	GABC
Security Exchange Name	NASDAQ
Entity Common Stock. Shares Outstanding		29,573,243
Document Quarterly Report	true
Document Transition Report	false
Amendment Flag	false
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q2
Entity Central Index Key	0000714395
Current Fiscal Year End Date	--12-31

XML

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
ASSETS
Cash and Due from Banks	$ 78,223	$ 77,174
Federal Funds Sold and Other Short-term Investments	62,448	41,905
Cash and Cash Equivalents	140,671	119,079
Interest-bearing Time Deposits with Banks	500	500
Securities Available-for-Sale, at Fair Value (Amortized Cost $1,915,401 for June 30, 2023; Amortized Cost $2,094,826 for December 31, 2022; No Allowance for Credit Losses)	1,600,709	1,761,669
Other Investments	353	353
Loans Held-for-Sale, at Fair Value	8,239	8,600
Loans	3,830,481	3,788,645
Less: Unearned Income	(4,472)	(3,711)
Allowance for Credit Losses	(44,266)	(44,168)
Loans, Net	3,781,743	3,740,766
Stock in FHLB of Indianapolis and Other Restricted Stock, at Cost	14,856	15,037
Premises, Furniture and Equipment, Net	112,629	112,237
Other Real Estate	0	0
Goodwill	180,357	180,357
Intangible Assets	7,773	9,426
Company Owned Life Insurance	84,926	83,998
Accrued Interest Receivable and Other Assets	120,513	123,969
TOTAL ASSETS	6,053,269	6,155,991
LIABILITIES
Non-interest-bearing Demand Deposits	1,540,564	1,691,804
Interest-bearing Demand, Savings, and Money Market Accounts	3,056,396	3,229,778
Time Deposits	582,745	428,469
Total Deposits	5,179,705	5,350,051
FHLB Advances and Other Borrowings	227,484	203,806
Accrued Interest Payable and Other Liabilities	43,515	43,741
TOTAL LIABILITIES	5,450,704	5,597,598
SHAREHOLDERS’ EQUITY
Common Stock, no par value, $1 stated value; 45,000,000 shares authorized	29,573	29,493
Additional Paid-in Capital	388,460	387,171
Retained Earnings	433,384	405,167
Accumulated Other Comprehensive Income (Loss)	(248,852)	(263,438)
TOTAL SHAREHOLDERS’ EQUITY	602,565	558,393
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$ 6,053,269	$ 6,155,991
End of period shares issued (in shares)	29,572,783	29,493,193
End of period shares outstanding (in shares)	29,572,783	29,493,193

XML

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Securities, Available-for-Sale, at Fair Value, Amortized Cost	$ 1,915,401,000	$ 2,094,826,000
Securities, Available-for-Sale, at Fair Value, Allowance for Credit Losses	$ 0	$ 0
Common stock, stated value (in dollars per share)	$ 1	$ 1
Common stock, shares authorized (in shares)	45,000,000	45,000,000

XML

CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
INTEREST INCOME
Interest and Fees on Loans	$ 52,202	$ 39,987	$ 101,263	$ 78,922
Interest on Federal Funds Sold and Other Short-term Investments	660	1,232	1,005	1,512
Interest and Dividends on Securities:
Taxable	5,223	5,113	10,619	9,633
Non-taxable	5,429	5,934	11,116	11,474
TOTAL INTEREST INCOME	63,514	52,266	124,003	101,541
INTEREST EXPENSE
Interest on Deposits	13,357	1,549	22,328	2,878
Interest on FHLB Advances and Other Borrowings	1,899	1,120	4,408	2,158
TOTAL INTEREST EXPENSE	15,256	2,669	26,736	5,036
NET INTEREST INCOME	48,258	49,597	97,267	96,505
Provision for Credit Losses	550	300	1,650	5,500
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES	47,708	49,297	95,617	91,005
NON-INTEREST INCOME
Company Owned Life Insurance	429	894	830	1,352
Other Operating Income	1,462	1,225	2,673	2,493
Net Gains on Sales of Loans	630	1,049	1,217	2,470
Net Gains on Securities	38	78	40	450
TOTAL NON-INTEREST INCOME	14,896	15,180	29,863	31,368
NON-INTEREST EXPENSE
Salaries and Employee Benefits	20,103	20,384	41,949	43,472
Occupancy Expense	2,547	2,803	5,457	5,682
Furniture and Equipment Expense	896	969	1,806	1,899
FDIC Premiums	687	465	1,428	941
Data Processing Fees	2,803	2,460	5,558	10,184
Professional Fees	1,614	1,573	3,176	3,936
Advertising and Promotion	1,261	1,027	2,428	2,165
Intangible Amortization	734	957	1,519	1,974
Other Operating Expenses	5,081	5,063	10,021	13,608
TOTAL NON-INTEREST EXPENSE	35,726	35,701	73,342	83,861
Income before Income Taxes	26,878	28,776	52,138	38,512
Income Tax Expense	4,755	5,029	9,208	5,698
NET INCOME	$ 22,123	$ 23,747	$ 42,930	$ 32,814
Basic Earnings Per Share (in dollars per share)	$ 0.75	$ 0.81	$ 1.45	$ 1.11
Diluted Earnings Per Share (in dollars per share)	$ 0.75	$ 0.81	$ 1.45	$ 1.11
Wealth Management Fees
NON-INTEREST INCOME
Non-interest income	$ 2,912	$ 2,642	$ 5,556	$ 5,280
Service Charges on Deposit Accounts
NON-INTEREST INCOME
Non-interest income	2,883	2,871	5,671	5,554
Insurance Revenues
NON-INTEREST INCOME
Non-interest income	2,130	2,254	5,265	5,975
Interchange Fee Income
NON-INTEREST INCOME
Non-interest income	$ 4,412	$ 4,167	$ 8,611	$ 7,794

XML

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Statement of Comprehensive Income [Abstract]
NET INCOME	$ 22,123	$ 23,747	$ 42,930	$ 32,814
Unrealized Gains (Losses) on Securities:
Unrealized Holding Gain (Loss) Arising During the Period	(23,243)	(117,357)	18,506	(286,698)
Reclassification Adjustment for Gains Included in Net Income	(38)	(78)	(40)	(450)
Tax Effect	4,921	24,741	(3,880)	60,569
Net of Tax	(18,360)	(92,694)	14,586	(226,579)
Total Other Comprehensive Income (Loss)	(18,360)	(92,694)	14,586	(226,579)
COMPREHENSIVE INCOME (LOSS)	$ 3,763	$ (68,947)	$ 57,516	$ (193,765)

XML

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Income (Loss)
Beginning Balances (in shares) at Dec. 31, 2021		26,553,508
Beginning Balances at Dec. 31, 2021	$ 668,459	$ 26,554	$ 276,057	$ 350,364	$ 15,484
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income	9,067			9,067
Other Comprehensive Income (Loss)	(133,885)				(133,885)
Cash Dividends	(6,752)			(6,752)
Issuance of Common Stock for:
Acquisition of Citizens Union Bancorp of Shelbyville, Inc., net (in shares)		2,870,975
Acquisition of Citizens Union Bancorp of Shelbyville, Inc., net	111,723	$ 2,871	108,852
Restricted Share Grants Net (in shares)		(61,200)
Restricted Share Grants Net	424	$ 61	363
Ending Balances (in shares) at Mar. 31, 2022		29,485,683
Ending Balances at Mar. 31, 2022	649,036	$ 29,486	385,272	352,679	(118,401)
Beginning Balances (in shares) at Dec. 31, 2021		26,553,508
Beginning Balances at Dec. 31, 2021	668,459	$ 26,554	276,057	350,364	15,484
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income	32,814
Other Comprehensive Income (Loss)	(226,579)
Ending Balances (in shares) at Jun. 30, 2022		29,483,045
Ending Balances at Jun. 30, 2022	574,429	$ 29,483	386,368	369,673	(211,095)
Beginning Balances (in shares) at Mar. 31, 2022		29,485,683
Beginning Balances at Mar. 31, 2022	649,036	$ 29,486	385,272	352,679	(118,401)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income	23,747			23,747
Other Comprehensive Income (Loss)	(92,694)				(92,694)
Cash Dividends	(6,753)			(6,753)
Issuance of Common Stock for:
Restricted Share Grants Net (in shares)		(2,638)
Restricted Share Grants Net	1,093	$ (3)	1,096
Ending Balances (in shares) at Jun. 30, 2022		29,483,045
Ending Balances at Jun. 30, 2022	$ 574,429	$ 29,483	386,368	369,673	(211,095)
Beginning Balances (in shares) at Dec. 31, 2022	29,493,193	29,493,193
Beginning Balances at Dec. 31, 2022	$ 558,393	$ 29,493	387,171	405,167	(263,438)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income	20,807			20,807
Other Comprehensive Income (Loss)	32,946				32,946
Cash Dividends	(7,354)			(7,354)
Issuance of Common Stock for:
Restricted Share Grants Net (in shares)		(80,246)
Restricted Share Grants Net	539	$ 80	459
Ending Balances (in shares) at Mar. 31, 2023		29,573,439
Ending Balances at Mar. 31, 2023	$ 605,331	$ 29,573	387,630	418,620	(230,492)
Beginning Balances (in shares) at Dec. 31, 2022	29,493,193	29,493,193
Beginning Balances at Dec. 31, 2022	$ 558,393	$ 29,493	387,171	405,167	(263,438)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income	42,930
Other Comprehensive Income (Loss)	$ 14,586
Ending Balances (in shares) at Jun. 30, 2023	29,572,783	29,572,783
Ending Balances at Jun. 30, 2023	$ 602,565	$ 29,573	388,460	433,384	(248,852)
Beginning Balances (in shares) at Mar. 31, 2023		29,573,439
Beginning Balances at Mar. 31, 2023	605,331	$ 29,573	387,630	418,620	(230,492)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income	22,123			22,123
Other Comprehensive Income (Loss)	(18,360)				(18,360)
Cash Dividends	(7,359)			(7,359)
Issuance of Common Stock for:
Restricted Share Grants Net (in shares)		(656)
Restricted Share Grants Net	$ 830		830
Ending Balances (in shares) at Jun. 30, 2023	29,572,783	29,572,783
Ending Balances at Jun. 30, 2023	$ 602,565	$ 29,573	$ 388,460	$ 433,384	$ (248,852)

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CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) - $ / shares	3 Months Ended
	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2022	Mar. 31, 2022
Statement of Stockholders' Equity [Abstract]
Cash dividends (in dollars per share)	$ 0.25	$ 0.25	$ 0.23	$ 0.23

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income	$ 42,930	$ 32,814
Adjustments to Reconcile Net Income to Net Cash from Operating Activities:
Net Amortization on Securities	2,779	3,341
Depreciation and Amortization	4,840	5,250
Loans Originated for Sale	(48,256)	(98,293)
Proceeds from Sales of Loans Held-for-Sale	49,744	104,858
Provision for Credit Losses	1,650	5,500
Gain on Sale of Loans, net	(1,217)	(2,470)
Gain on Securities, net	(40)	(450)
Gain on Sales of Other Real Estate and Repossessed Assets	0	(19)
Gain on Disposition and Donation of Premises and Equipment	2	(28)
Increase in Cash Surrender Value of Company Owned Life Insurance	(928)	(908)
Equity Based Compensation	1,369	1,517
Change in Assets and Liabilities:
Interest Receivable and Other Assets	601	6,508
Interest Payable and Other Liabilities	(233)	(7,299)
Net Cash from Operating Activities	53,241	50,321
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from Maturities of Securities Available-for-Sale	145,360	73,320
Proceeds from Sales of Securities Available-for-Sale	114,259	97,500
Purchase of Securities Available-for-Sale	(82,933)	(290,743)
Proceeds from Redemption of Federal Home Loan Bank Stock	181	7,867
Purchase of Loans	(173)	(1,063)
Proceeds from Sale of Loans Held for Investment	0	609
Loans Made to Customers, net of Payments Received	(42,454)	33,504
Proceeds from Sales of Other Real Estate	0	89
Property and Equipment Expenditures	(4,464)	(5,211)
Proceeds from Life Insurance	0	773
Acquisition of Citizens Union Bancorp of Shelbyville, Inc.	0	207,764
Net Cash from Investing Activities	129,776	124,409
CASH FLOWS FROM FINANCING ACTIVITIES
Change in Deposits	(170,162)	38,496
Change in Short-term Borrowings	(1,487)	(28,934)
Advances in Long-term Debt	25,000	0
Repayments of Long-term Debt	(63)	(41,632)
Dividends Paid	(14,713)	(13,505)
Net Cash from Financing Activities	(161,425)	(45,575)
Net Change in Cash and Cash Equivalents	21,592	129,155
Cash and Cash Equivalents at Beginning of Year	119,079	396,890
Cash and Cash Equivalents at End of Period	140,671	526,045
Cash Paid During the Period for
Interest	24,353	4,831
Income Taxes	9,736	8,312
Supplemental Non Cash Disclosures
Interest Rate Swap Fair Value Adjustment	(637)	1,055
Supplemental Schedule for Investing Activities (Acquisition of CUB)
Assets acquired, net of purchase consideration	0	945,160
Liabilities assumed	0	1,003,756
Goodwill	$ 0	$ 58,596

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Basis of Presentation and Market Conditions

6 Months Ended

Jun. 30, 2023

Accounting Policies [Abstract]

Basis of Presentation and Market Conditions

Basis of Presentation and Market Conditions

German American Bancorp, Inc. operates primarily in the banking industry. The accounting and reporting policies of German American Bancorp, Inc. and its subsidiaries (hereinafter collectively referred to as the "Company") conform to U.S. generally accepted accounting principles. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted. All adjustments which are, in the opinion of management, necessary for a fair presentation of the results for the periods reported have been included in the accompanying unaudited consolidated financial statements, and all such adjustments are of a normal recurring nature. It is suggested that these consolidated financial statements and notes be read in conjunction with the financial statements and notes thereto in the Company's Annual Report on Form 10-K for the year ended December 31, 2022. Certain items included in the prior period financial statements were reclassified to conform to the current presentation. There was no effect on net income or total shareholders' equity based on these reclassifications.

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Recent Accounting Pronouncements

6 Months Ended

Jun. 30, 2023

Accounting Policies [Abstract]

Recent Accounting Pronouncements

Recent Accounting Pronouncements

Recently Adopted Accounting Guidance

In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting”. These amendments provide temporary optional guidance to ease the potential burden in accounting for reference rate reform. The ASU provides optional expedients and exceptions for applying generally accepted accounting principles to contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued. It is intended to help stakeholders during the global market-wide reference rate transition period. In January 2021, the FASB issued ASU 2021-01 which clarifies that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The guidance is effective for all entities as of March 12, 2020 through December 31, 2024. The Company has discontinued originating LIBOR based loans and has a plan in place to transition LIBOR indexed loans primarily to term SOFR or other indices.

On March 31, 2022, the FASB issued ASU 2022-02, “Financial Instruments - Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures” which eliminates the troubled debt restructuring recognition and measurement guidance and instead requires an entity to evaluate whether the modification represents a new loan or a continuation of an existing loan. The amendments also enhance existing disclosures and include new disclosure requirements related to certain modifications of receivables made to borrowers experiencing financial difficulty. To improve consistency for vintage disclosures, the ASU requires that public business entities disclose current-period gross write-offs by year of origination for financing receivables and net investments in leases within the scope of Subtopic 326-20. For entities that have adopted ASU 2016-13, the amendments are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. For entities that have not adopted ASU 2016-13, the effective dates for the amendments are the same as the effective dates in ASU 2016-13. Early adoption is permitted if ASU 2016-13 has been adopted, including adoption in an interim period. If an entity elects to adopt the amendments in an interim period, the guidance should be applied as of the beginning of the fiscal year that includes the interim period. The Company adopted the new guidance prospectively with no material impact to the consolidated financial statements.

The SEC released Staff Accounting Bulletin No. 121 (“SAB 121”) on March 31, 2022, which provides interpretive guidance regarding the accounting for obligations to safeguard crypto-assets an entity holds for its customers, either directly, through an agent or through another third party acting on its behalf. SAB 121 requires an entity to recognize a liability on its balance sheet to reflect the obligation to safeguard the crypto-assets of others, along with a corresponding safeguarding asset, both of which are measured at fair value. The Company has completed an evaluation and concluded that it does not have a safeguarding obligation under SAB 121 and therefore the disclosures do not apply.

Newly Issued But Not Yet Effective Accounting Standards

On March 29, 2023, the FASB issued ASU 2023-02, "Investments - Equity Method and Joint Ventures (Topic 323): Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method" to expand use of the proportional amortization method of accounting to equity investments in tax credit programs beyond those in low-income-housing tax credit (LIHTC) programs. The amendments in this update permit reporting entities to account for certain tax equity

investments, regardless of the tax credit program from which the income tax credits are received, using the proportional amortization method if certain conditions are met. This guidance provides clarifications to address interpretive issues and prescribes specific information that reporting entities must disclose about tax credit investments each period.

This ASU is effective for reporting periods beginning after December 15, 2023, for public business entities. For all other entities, the ASU is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted, included early adoption in any interim period as of the beginning of the fiscal year that includes that interim period. Entities have the option of applying the forthcoming revisions using either a modified retrospective or retrospective adoption approach. The Company is currently evaluating the impact of adopting this new guidance, however, adoption of the standard is not expected to have a material impact on the Company's financial statements or disclosures.

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Per Share Data

6 Months Ended

Jun. 30, 2023

Earnings Per Share [Abstract]

Per Share Data

Per Share Data

The computation of Basic Earnings per Share and Diluted Earnings per Share are as follows:

	Three Months Ended  June 30,
	2023		2022
Basic Earnings per Share:
Net Income	$	22,123	$	23,747
Weighted Average Shares Outstanding	29,573,042		29,483,848
Basic Earnings per Share	$	0.75	$	0.81
Diluted Earnings per Share:
Net Income	$	22,123	$	23,747
Weighted Average Shares Outstanding	29,573,042		29,483,848
Potentially Dilutive Shares, Net	—		—
Diluted Weighted Average Shares Outstanding	29,573,042		29,483,848
Diluted Earnings per Share	$	0.75	$	0.81

For the three months ended June 30, 2023 and 2022, there were no anti-dilutive shares.

	Six Months Ended  June 30,
	2023		2022
Basic Earnings per Share:
Net Income	$	42,930	$	32,814
Weighted Average Shares Outstanding	29,540,425		29,443,673
Basic Earnings per Share	$	1.45	$	1.11
Diluted Earnings per Share:
Net Income	$	42,930	$	32,814
Weighted Average Shares Outstanding	29,540,425		29,443,673
Potentially Dilutive Shares, Net	—		—
Diluted Weighted Average Shares Outstanding	29,540,425		29,443,673
Diluted Earnings per Share	$	1.45	$	1.11

For the six months ended June 30, 2023 and 2022, there were no anti-dilutive shares.

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Securities

6 Months Ended

Jun. 30, 2023

Investments, Debt and Equity Securities [Abstract]

Securities

Securities 

The amortized cost, unrealized gross gains and losses recognized in accumulated other comprehensive income (loss), and fair value of securities available-for-sale were as follows:

Securities Available-for-Sale:	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value
June 30, 2023
U.S. Treasury	$	999	$	1	$	—	$	—	$	1,000
Obligations of State and Political Subdivisions	894,264		487		(147,445)		—		747,306
MBS/CMO	793,915		—		(128,046)		—		665,869
US Gov’t Sponsored Entities & Agencies	226,223		—		(39,689)		—		186,534
Total	$	1,915,401	$	488	$	(315,180)	$	—	$	1,600,709
December 31, 2022
U.S. Treasury	$	64,097	$	22	$	—	$	—	$	64,119
Obligations of State and Political Subdivisions	939,193		673		(162,014)		—		777,852
MBS/CMO	846,519		—		(131,838)		—		714,681
US Gov’t Sponsored Entities & Agencies	245,017		—		(40,000)		—		205,017
Total	$	2,094,826	$	695	$	(333,852)	$	—	$	1,761,669

All mortgage-backed securities in the above table (identified above and throughout this Note 4 as "MBS/CMO") are residential and multi-family mortgage-backed securities and guaranteed by government sponsored entities. The US Gov’t Sponsored Entities & Agencies in the above table include securities that have underlying collateral of equipment, machinery and commercial real estate.

The amortized cost and fair value of securities available-for-sale at June 30, 2023 by contractual maturity are shown below. Expected maturities may differ from contractual maturities because some issuers have the right to call or prepay certain obligations with or without call or prepayment penalties. Mortgage-backed Securities are not due at a single maturity date and are shown separately.

Securities Available-for-Sale:	Amortized Cost		Fair Value
Due in one year or less	$	2,964	$	2,963
Due after one year through five years	15,119		15,106
Due after five years through ten years	53,731		51,246
Due after ten years	823,449		678,991
MBS/CMO	793,915		665,869
US Gov’t Sponsored Entities & Agencies	226,223		186,534
Total	$	1,915,401	$	1,600,709

Proceeds from the Sales of Securities are summarized below:

	Three Months Ended		Three Months Ended
	June 30, 2023		June 30, 2022
Proceeds from Sales	$	20,507	$	5,554
Gross Gains on Sales	38		78
Income Taxes on Gross Gains	8		16

	Six Months Ended		Six Months Ended
	June 30, 2023		June 30, 2022
Proceeds from Sales	$	114,259	$	97,500
Gross Gains on Sales	40		450
Income Taxes on Gross Gains	8		94

The carrying value of securities pledged to secure repurchase agreements, public and trust deposits, and for other purposes as required by law was $374,291 and $354,123 as of June 30, 2023 and December 31, 2022, respectively.

Below is a summary of securities with unrealized losses as of June 30, 2023 and December 31, 2022, presented by length of time the securities have been in a continuous unrealized loss position:

	Less than 12 Months				12 Months or More				Total
June 30, 2023	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
U.S. Treasury	$	—	$	—	$	—	$	—	$	—	$	—
Obligations of State and Political Subdivisions	59,277		(688)		646,205		(146,757)		705,482		(147,445)
MBS/CMO	23,202		(1,315)		642,660		(126,731)		665,862		(128,046)
US Gov’t Sponsored Entities & Agencies	—		—		186,534		(39,689)		186,534		(39,689)
Total	$	82,479	$	(2,003)	$	1,475,399	$	(313,177)	$	1,557,878	$	(315,180)

	Less than 12 Months				12 Months or More				Total
December 31, 2022	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
U.S. Treasury	$	—	$	—	$	—	$	—	$	—	$	—
Obligations of State and Political Subdivisions	579,267		(117,423)		122,992		(44,591)		702,259		(162,014)
MBS/CMO	240,344		(20,920)		474,327		(110,918)		714,671		(131,838)
US Gov’t Sponsored Entities & Agencies	198,702		(38,818)		6,314		(1,182)		205,016		(40,000)
Total	$	1,018,313	$	(177,161)	$	603,633	$	(156,691)	$	1,621,946	$	(333,852)

Available-for-sale debt securities in unrealized loss positions are evaluated for impairment related to credit losses at least quarterly. For available-for-sale debt securities in an unrealized loss position, the Company assesses whether we intend to sell, or it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is reduced to fair value through income. For available-for sale debt securities that do not meet the criteria, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, management considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and adverse conditions specifically related to the security and the issuer, among other factors. If this assessment indicates that a credit loss exists, we compare the present value of cash flows expected to be collected from the security with the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis for the security, a credit loss exists and an allowance for credit losses is recorded, limited to the amount that the fair value of the security is less than its amortized cost basis. Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income, net of applicable taxes. The increase in unrealized losses from December 31, 2022 to June 30, 2023 was primarily the result of fair value adjustments caused by the change in market interest rates. There was no allowance for credit losses for available-for-sale debt securities at June 30, 2023 or December 31, 2022.

Although management has the ability to sell these securities if the need arises, their designation as available-for-sale should not necessarily be interpreted as an indication that management anticipates such sales.

Accrued interest receivable on available-for-sale debt securities totaled $9,802 at June 30, 2023 and $10,637 at December 31, 2022. Accrued interest receivable is excluded from the estimate of credit losses.

The Company’s equity securities are listed as Other Investments on the Consolidated Balance Sheets and consist of one non-controlling investment in a single banking organization at June 30, 2023 and December 31, 2022. The original investment totaled $1,350 and other-than-temporary impairment was previously recorded totaling $997. The Company’s equity securities are considered not to have readily determinable fair value and are carried at cost and evaluated for impairment. At June 30, 2023, there was no additional impairment recognized through earnings.

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Derivatives

6 Months Ended

Jun. 30, 2023

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives

Derivatives

The Company executes interest rate swaps with commercial banking customers to facilitate their respective risk management strategies. The notional amounts of these interest rate swaps and the offsetting counterparty derivative instruments were $135,113 at June 30, 2023 and $134,684 at December 31, 2022. These interest rate swaps are simultaneously hedged by offsetting interest rate swaps that the Company executes with a third party, such that the Company minimizes its net risk exposure resulting from such transactions with approved, reputable, independent counterparties with substantially matching terms. The agreements are considered stand-alone derivatives and changes in the fair value of derivatives are reported in earnings as non-interest income. While the derivatives represent economic hedges, they do not qualify as hedges for accounting purposes.  

Credit risk arises from the possible inability of counterparties to meet the terms of their contracts. The Company’s exposure is limited to the replacement value of the contracts rather than the notional, principal or contract amounts. There are provisions in the agreements with the counterparties that allow for certain unsecured credit exposure up to an agreed threshold. Exposures in excess of the agreed thresholds are collateralized. In addition, the Company minimizes credit risk through credit approvals, limits, and monitoring procedures.

The following table reflects the fair value of derivative instruments included in the Consolidated Balance Sheets as of:

	June 30, 2023				December 31, 2022
	Notional Amount		Fair Value		Notional Amount		Fair Value
Included in Other Assets:
Interest Rate Swaps	$	135,113	$	9,183	$	134,684	$	9,899
Included in Other Liabilities:
Interest Rate Swaps	$	135,113	$	9,112	$	134,684	$	9,749

The following table presents the effect of derivative instruments on the Consolidated Statements of Income for the periods presented:

	Three Months Ended  June 30,				Six Months Ended  June 30,
	2023		2022		2023		2022
Interest Rate Swaps:
Included in Other Operating Income	$	227	$	130	$	178	$	344

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Loans

6 Months Ended

Jun. 30, 2023

Receivables [Abstract]

Loans

Loans

Loans were comprised of the following classifications:

	June 30, 2023		December 31, 2022
Commercial:
Commercial and Industrial Loans	$	608,284	$	620,106
Commercial Real Estate Loans	2,021,109		1,966,884
Agricultural Loans	395,466		417,413
Leases	60,853		56,396
Retail:
Home Equity Loans	284,517		279,748
Consumer Loans	85,595		79,904
Credit Cards	19,328		17,512
Residential Mortgage Loans	355,329		350,682
Subtotal	3,830,481		3,788,645
Less: Unearned Income	(4,472)		(3,711)
Allowance for Credit Losses	(44,266)		(44,168)
Loans, net	$	3,781,743	$	3,740,766

The table above includes $15,779 and $21,149 of purchase credit deteriorated loans as of June 30, 2023 and December 31, 2022, respectively.

Allowance for Credit Losses for Loans

The following tables present the activity in the allowance for credit losses by portfolio segment for the three months ended June 30, 2023 and 2022:

June 30, 2023	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Unallocated		Total
Allowance for Credit Losses:
Beginning balance	$	13,572	$	22,062	$	3,887	$	227	$	609	$	1,415	$	263	$	2,280	$	—	$	44,315
Provision (Benefit) for credit loss expense	244		(233)		94		8		174		45		157		61		—		550
Loans charged-off	(343)		—		(25)		—		(284)		(25)		(141)		(31)		—		(849)
Recoveries collected	94		5		—		—		141		1		9		—		—		250
Total ending allowance balance	$	13,567	$	21,834	$	3,956	$	235	$	640	$	1,436	$	288	$	2,310	$	—	$	44,266

June 30, 2022	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Unallocated		Total
Allowance for Credit Losses:
Beginning balance	$	12,720	$	23,217	$	4,759	$	196	$	616	$	1,207	$	212	$	2,151	$	—	$	45,078
Provision (Benefit) for credit loss expense	874		(873)		(131)		(5)		293		41		73		28		—		300
Loans charged-off	(56)		—		—		—		(322)		(15)		(51)		(3)		—		(447)
Recoveries collected	7		5		—		—		81		—		5		2		—		100
Total ending allowance balance	$	13,545	$	22,349	$	4,628	$	191	$	668	$	1,233	$	239	$	2,178	$	—	$	45,031

The following tables present the activity in the allowance for credit losses by portfolio segment for the six months ended June 30, 2023 and 2022:

June 30, 2023	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Unallocated		Total
Allowance for Credit Losses:
Beginning balance	$	13,749	$	21,598	$	4,188	$	209	$	595	$	1,344	$	257	$	2,228	$	—	$	44,168
Provision (Benefit) for credit loss expense	746		169		(207)		26		399		100		281		136		—		1,650
Loans charged-off	(1,077)		—		(25)		—		(628)		(39)		(261)		(57)		—		(2,087)
Recoveries collected	149		67		—		—		274		31		11		3		—		535
Total ending allowance balance	$	13,567	$	21,834	$	3,956	$	235	$	640	$	1,436	$	288	$	2,310	$	—	$	44,266

June 30, 2022	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Unallocated		Total
Allowance for Credit Losses:
Beginning balance	$	9,554	$	19,245	$	4,505	$	200	$	507	$	1,061	$	240	$	1,705	$	—	$	37,017
Acquisition of Citizens Union Bank of Shelbyville, KY	376		1,945		689		—		2		—		—		105		—		3,117
Provision (Benefit) for credit loss expense	3,662		1,223		(566)		(9)		518		224		79		369		—		5,500
Loans charged-off	(61)		(78)		—		—		(532)		(52)		(90)		(3)		—		(816)
Recoveries collected	14		14		—		—		173		—		10		2		—		213
Total ending allowance balance	$	13,545	$	22,349	$	4,628	$	191	$	668	$	1,233	$	239	$	2,178	$	—	$	45,031

The Company utilizes the Static Pool methodology in determining expected future credit losses. Static pool analysis means segmenting and tracking loans over a period of time based on similar risk characteristics such as loan structure, collateral type, industry of borrower and concentrations, contractual terms and credit risk indicators. Static pool calculates a loss rate on a closed pool of loans that existed on a specified start date based upon the remaining life of each segment.

The Company’s expected loss estimate is anchored in historical credit loss experience, with an emphasis on all available portfolio data. The Company's historical look-back period includes January 2014 through the current period, on a monthly basis.

Qualitative reserves reflect management’s overall estimate of the extent to which current expected credit losses on collectively evaluated loans will differ from historical loss experience. The analysis takes into consideration industry and collateral concentrations, acquired loan portfolio characteristics and other credit-related analytics as deemed appropriate. Management attempts to quantify qualitative reserves by anchoring to specific data points when possible.

The Company estimates the allowance balance using relevant available information, from internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts. Historical loss experience provides the basis for the estimation of expected credit losses. Adjustments to historical loss information are made for changes in underwriting standards, portfolio mix, delinquency level, changes in environmental conditions, unemployment rates, risk classifications and collateral values. The allowance for credit losses is measured on a collective (pooled) basis when similar risk characteristics exist. Based on the potential increased losses related to the advancing stress on the economy as a result of inflationary pressures, rising interest rates and financial market volatility, the Company has considered this loss experience may align with loss experience from the recessionary period from 2008-2011 and qualitative adjustments have been made accordingly.

Loans that do not share risk characteristics are evaluated on an individual basis. Loans evaluated individually are not included in the collective evaluation. When the borrower is experiencing financial difficulty at the reporting date and repayment is expected to be provided substantially through the operation or sale of the collateral, expected credit losses are based on the fair value of the collateral at the reporting date adjusted for selling costs.

For the six months ended June 30, 2023, the allowance for credit losses increased slightly compared to December 31, 2022. The Company saw improvement in individually analyzed loans and added reserve for loan portfolio growth. Key indicators utilized in forecasting for the allowance calculations include unemployment rates and gross domestic product as well as commodity prices for the agricultural segment of the portfolio. There has been some improvement in these factors over previous periods; however, rising interest rates and the expanded inflationary impact on consumer discretionary spending were considered in the qualitative factors to determine the allowance for credit losses.

All classes of loans, including loans acquired with deteriorated credit quality, are generally placed on non-accrual status when scheduled principal or interest payments are past due for 90 days or more or when the borrower’s ability to repay becomes doubtful. For purchased loans, the determination is made at the time of acquisition as well as over the life of the loan. Uncollected accrued interest for each class of loans is reversed against income at the time a loan is placed on non-accrual. Interest received on such loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual. All classes of loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. Loans are typically charged-off at 180 days past due, or earlier if deemed uncollectible. Exceptions to the non-accrual and charge-off policies are made when the loan is well secured and in the process of collection.

The following tables present the amortized cost in non-accrual loans and loans past due over 89 days still accruing by class of loans as of June 30, 2023 and December 31, 2022:

June 30, 2023	Non-Accrual With No Allowance for Credit Loss (1)		Total Non-Accrual		Loans Past Due Over 89 Days Still Accruing
Commercial and Industrial Loans	$	620	$	7,577	$	1,000
Commercial Real Estate Loans	425		1,178		—
Agricultural Loans	906		1,252		—
Leases	—		—		—
Home Equity Loans	449		503		—
Consumer Loans	18		18		—
Credit Cards	119		119		—
Residential Mortgage Loans	431		776		—
Total	$	2,968	$	11,423	$	1,000

(1) Non-accrual loans with no allowance for credit loss and are also included in Total Non-Accrual loans of $11,423.

Interest income on non-accrual loans recognized during the three and six months ended June 30, 2023 totaled $21 and $37, respectively.

December 31, 2022	Non-Accrual With No Allowance for Credit Loss (1)		Total Non-Accrual		Loans Past Due Over 89 Days Still Accruing
Commercial and Industrial Loans	$	1,142	$	7,936	$	1,427
Commercial Real Estate Loans	49		1,950		—
Agricultural Loans	994		1,062		—
Leases	—		—		—
Home Equity Loans	262		310		—
Consumer Loans	240		254		—
Credit Cards	146		146		—
Residential Mortgage Loans	676		1,230		—
Total	$	3,509	$	12,888	$	1,427

(1) Includes non-accrual loans with no allowance for credit loss and are also included in Total Non-Accrual loans of $12,888.

Interest income on non-accrual loans recognized during the year ended December 31, 2022 totaled $32.

The following tables present the amortized cost basis of collateral-dependent loans by class of loans as of June 30, 2023 and December 31, 2022:

June 30, 2023	Real Estate		Equipment		Accounts Receivable		Other		Total
Commercial and Industrial Loans	$	2,005	$	216	$	—	$	6,849	$	9,070
Commercial Real Estate Loans	9,050		35		—		—		9,085
Agricultural Loans	4,160		288		—		—		4,448
Leases	—		—		—		—		—
Home Equity Loans	475		—		—		—		475
Consumer Loans	8		1		—		—		9
Credit Cards	—		—		—		—		—
Residential Mortgage Loans	860		—		—		—		860
Total	$	16,558	$	540	$	—	$	6,849	$	23,947

December 31, 2022	Real Estate		Equipment		Accounts Receivable		Other		Total
Commercial and Industrial Loans	$	2,078	$	1,219	$	272	$	5,851	$	9,420
Commercial Real Estate Loans	12,192		36		—		—		12,228
Agricultural Loans	4,944		318		—		—		5,262
Leases	—		—		—		—		—
Home Equity Loans	467		—		—		—		467
Consumer Loans	8		2		—		12		22
Credit Cards	—		—		—		—		—
Residential Mortgage Loans	1,060		—		—		—		1,060
Total	$	20,749	$	1,575	$	272	$	5,863	$	28,459

The following tables present the aging of the amortized cost basis in past due loans by class of loans as of June 30, 2023 and December 31, 2022:

June 30, 2023	30-59 Days Past Due		60-89 Days Past Due		Greater Than 89 Days Past Due		Total Past Due		Loans Not Past Due		Total
Commercial and Industrial Loans	$	96	$	49	$	8,110	$	8,255	$	600,029	$	608,284
Commercial Real Estate Loans	710		599		1,009		2,318		2,018,791		2,021,109
Agricultural Loans	632		590		780		2,002		393,464		395,466
Leases	—		—		—		—		60,853		60,853
Home Equity Loans	1,163		89		503		1,755		282,762		284,517
Consumer Loans	133		42		17		192		85,403		85,595
Credit Cards	94		22		119		235		19,093		19,328
Residential Mortgage Loans	6,072		966		557		7,595		347,734		355,329
Total	$	8,900	$	2,357	$	11,095	$	22,352	$	3,808,129	$	3,830,481

December 31, 2022	30-59 Days Past Due		60-89 Days Past Due		Greater Than 89 Days Past Due		Total Past Due		Loans Not Past Due		Total
Commercial and Industrial Loans	$	268	$	681	$	8,285	$	9,234	$	610,872	$	620,106
Commercial Real Estate Loans	1,617		14		616		2,247		1,964,637		1,966,884
Agricultural Loans	343		—		123		466		416,947		417,413
Leases	—		—		—		—		56,396		56,396
Home Equity Loans	1,770		140		310		2,220		277,528		279,748
Consumer Loans	219		64		252		535		79,369		79,904
Credit Cards	86		24		146		256		17,256		17,512
Residential Mortgage Loans	6,330		2,783		1,051		10,164		340,518		350,682
Total	$	10,633	$	3,706	$	10,783	$	25,122	$	3,763,523	$	3,788,645

Loan Modifications Made to Borrowers Experiencing Financial Difficulty

Effective January 1, 2023, the Company prospectively adopted ASU 2022-02, which eliminated the accounting for troubled debt restructurings while establishing a new standard for the treatment of modifications made to borrowers experiencing financial difficulties. As such, effective with the adoption of the new standard, the Company will not include, prospectively, financial difficulty modifications in its presentation of nonperforming loans, nonperforming assets or classified assets. Prior period data, which included troubled debt restructurings, has not been adjusted.

The Company’s loan modifications for borrowers experiencing financial difficulties will typically include one or a combination of the following: a reduction of the stated interest rate of the loan; an extension of the maturity date at a stated rate of interest lower than the current market rate for new debt with similar risk; or a permanent reduction of the recorded investment in the loan. No modifications in 2023 resulted in the permanent reduction of the recorded investment in the loan.

During the three and six months ended June 30, 2023, the Company had no modified loans made to borrowers experiencing financial difficulty. There were no modified loans that had a payment default during the three and six months ended June 30, 2023 and were modified in the twelve months prior to that default to borrowers experiencing financial difficulty. The Company considers a loan to be in payment default once it is 30 days contractually past due under the modified terms.

Troubled Debt Restructurings Disclosures Prior to Adoption of ASU 2022-02

In certain instances, the Company may choose to restructure the contractual terms of loans. A troubled debt restructuring occurs when the Bank grants a concession to the borrower that it would not otherwise consider due to a borrower’s financial difficulty. In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without modification. This evaluation is performed under the Company’s internal underwriting policy. The Company uses the same methodology for loans acquired with deteriorated credit quality as for all other loans when determining whether the loan is a troubled debt restructuring.

As of December 31, 2022, the Company had no troubled debt restructurings. The Company had no specific allocation of allowance for these loans at December 31, 2022.

The Company had not committed to lending any additional amounts as of December 31, 2022 to customers with outstanding loans that are classified as troubled debt restructurings.

For the year ended December 31, 2022, the Company had no loans modified as troubled debt restructurings. Additionally, there were no loans modified as troubled debt restructurings for which there was a payment default within twelve months following the modification during the year ended December 31, 2022.

A loan is considered to be in payment default once it is 30 days contractually past due under the modified terms.

Credit Quality Indicators:

The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company classifies loans as to credit risk by individually analyzing loans. This analysis includes commercial and industrial loans, commercial real estate loans, and agricultural loans with an outstanding balance greater than $250. This analysis is typically performed on at least an annual basis. The Company uses the following definitions for risk ratings:

Special Mention. Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.

Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass rated loans.

Based on the analysis performed at June 30, 2023 and December 31, 2022, the risk category of loans by class of loans is as follows:

	Term Loans Amortized Cost Basis by Origination Year
As of June 30, 2023	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Commercial and Industrial:
Risk Rating
Pass	$	54,328	$	146,823	$	97,546	$	33,668	$	39,516	$	60,729	$	144,955	$	577,565
Special Mention	—		55		446		589		650		1,504		5,182		8,426
Substandard	25		530		5,248		550		1,156		2,145		12,639		22,293
Doubtful	—		—		—		—		—		—		—		—
Total Commercial & Industrial Loans	$	54,353	$	147,408	$	103,240	$	34,807	$	41,322	$	64,378	$	162,776	$	608,284
Current Period Gross Charge-Offs	$	—	$	861	$	32	$	33	$	—	$	50	$	101	$	1,077
Commercial Real Estate:
Risk Rating
Pass	$	151,013	$	411,741	$	488,764	$	232,238	$	153,101	$	499,661	$	32,722	$	1,969,240
Special Mention	13,647		836		948		4,774		243		20,191		—		40,639
Substandard	—		205		5,349		672		1,123		3,501		380		11,230
Doubtful	—		—		—		—		—		—		—		—
Total Commercial Real Estate Loans	$	164,660	$	412,782	$	495,061	$	237,684	$	154,467	$	523,353	$	33,102	$	2,021,109
Current Period Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Agricultural:
Risk Rating
Pass	$	24,291	$	59,278	$	43,841	$	44,708	$	23,191	$	107,131	$	61,116	$	363,556
Special Mention	1,617		333		1,028		5,856		2,593		10,950		4,159		26,536
Substandard	—		—		206		622		335		4,211		—		5,374
Doubtful	—		—		—		—		—		—		—		—
Total Agricultural Loans	$	25,908	$	59,611	$	45,075	$	51,186	$	26,119	$	122,292	$	65,275	$	395,466
Current Period Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	25	$	—	$	25
Leases:
Risk Rating
Pass	$	15,188	$	15,821	$	12,454	$	7,925	$	7,142	$	2,323	$	—	$	60,853
Special Mention	—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Total Leases	$	15,188	$	15,821	$	12,454	$	7,925	$	7,142	$	2,323	$	—	$	60,853
Current Period Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

	Term Loans Amortized Cost Basis by Origination Year
As of December 31, 2022	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Total
Commercial and Industrial:
Risk Rating
Pass	$	156,318	$	117,648	$	39,949	$	46,505	$	18,423	$	51,482	$	154,203	$	584,528
Special Mention	56		148		577		78		551		2,346		1,672		5,428
Substandard	1,714		5,629		849		1,304		1,028		2,237		17,389		30,150
Doubtful	—		—		—		—		—		—		—		—
Total Commercial & Industrial Loans	$	158,088	$	123,425	$	41,375	$	47,887	$	20,002	$	56,065	$	173,264	$	620,106
Commercial Real Estate:
Risk Rating
Pass	$	398,631	$	490,747	$	261,462	$	162,701	$	129,151	$	427,433	$	35,163	$	1,905,288
Special Mention	3,982		1,568		4,612		135		13,689		25,371		—		49,357
Substandard	—		4,628		489		1,415		979		4,728		—		12,239
Doubtful	—		—		—		—		—		—		—		—
Total Commercial Real Estate Loans	$	402,613	$	496,943	$	266,563	$	164,251	$	143,819	$	457,532	$	35,163	$	1,966,884
Agricultural:
Risk Rating
Pass	$	62,673	$	47,682	$	47,355	$	25,431	$	21,728	$	92,344	$	83,862	$	381,075
Special Mention	634		842		6,066		4,149		2,355		11,440		4,310		29,796
Substandard	—		210		628		429		85		5,190		—		6,542
Doubtful	—		—		—		—		—		—		—		—
Total Agricultural Loans	$	63,307	$	48,734	$	54,049	$	30,009	$	24,168	$	108,974	$	88,172	$	417,413
Leases:
Risk Rating
Pass	$	20,057	$	14,461	$	9,648	$	8,901	$	1,851	$	1,478	$	—	$	56,396
Special Mention	—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Total Leases	$	20,057	$	14,461	$	9,648	$	8,901	$	1,851	$	1,478	$	—	$	56,396

The Company considers the performance of the loan portfolio and its impact on the allowance for credit losses. For residential and consumer loan classes, the Company also evaluates credit quality based on the aging status of the loan, which was previously presented, and by payment activity.  The following tables present the amortized cost in residential, home equity and consumer loans based on payment activity.

	Term Loans Amortized Cost Basis by Origination Year
As of June 30, 2023	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Consumer:
Payment performance
Performing	$	29,474	$	32,598	$	13,564	$	4,116	$	1,412	$	2,456	$	1,957	$	85,577
Nonperforming	—		7		10		—		—		1		—		18
Total Consumer Loans	$	29,474	$	32,605	$	13,574	$	4,116	$	1,412	$	2,457	$	1,957	$	85,595
Current Period Gross Charge-Offs	$	554	$	24	$	20	$	19	$	3	$	1	$	7	$	628
Home Equity:
Payment performance
Performing	$	—	$	75	$	86	$	90	$	24	$	960	$	282,779	$	284,014
Nonperforming	—		40		252		—		44		99		68		503
Total Home Equity Loans	$	—	$	115	$	338	$	90	$	68	$	1,059	$	282,847	$	284,517
Current Period Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	24	$	15	$	39
Residential Mortgage:
Payment performance
Performing	$	28,513	$	68,601	$	90,501	$	43,591	$	18,887	$	104,460	$	—	$	354,553
Nonperforming	—		—		140		124		108		404		—		776
Total Residential Mortgage Loans	$	28,513	$	68,601	$	90,641	$	43,715	$	18,995	$	104,864	$	—	$	355,329
Current Period Gross Charge-Offs	$	—	$	—	$	21	$	36	$	—	$	—	$	—	$	57

	Term Loans Amortized Cost Basis by Origination Year
As of December 31, 2022	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Total
Consumer:
Payment performance
Performing	$	42,685	$	22,708	$	5,610	$	2,394	$	1,543	$	1,553	$	3,157	$	79,650
Nonperforming	3		19		212		8		2		10		—		254
Total Consumer Loans	$	42,688	$	22,727	$	5,822	$	2,402	$	1,545	$	1,563	$	3,157	$	79,904
Home Equity:
Payment performance
Performing	$	63	$	—	$	—	$	—	$	—	$	591	$	278,784	$	279,438
Nonperforming	—		20		—		—		19		1		270		310
Total Home Equity Loans	$	63	$	20	$	—	$	—	$	19	$	592	$	279,054	$	279,748
Residential Mortgage:
Payment performance
Performing	$	69,982	$	97,176	$	46,851	$	20,080	$	16,664	$	98,699	$	—	$	349,452
Nonperforming	—		161		253		—		78		738		—		1,230
Total Residential Mortgage Loans	$	69,982	$	97,337	$	47,104	$	20,080	$	16,742	$	99,437	$	—	$	350,682

The Company considers the performance of the loan portfolio and its impact on the allowance for credit loan losses. For certain retail loan classes, the Company also evaluates credit quality based on the aging status of the loan, which was previously presented, and by payment activity. The following table presents the recorded investment in credit cards based on payment activity:

Credit Cards	June 30, 2023		December 31, 2022
Performing	$	19,209	$	17,366
Nonperforming	119		146
Total	$	19,328	$	17,512

The following tables present loans purchased and/or sold during the year by portfolio segment and excludes the business combination activity:

June 30, 2023	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Total
Purchases	$	—	$	173	$	—	$	—	$	—	$	—	$	—	$	—	$	173
Sales	—		—		—		—		—		—		—		—		—

December 31, 2022	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Total
Purchases	$	522	$	411	$	—	$	—	$	—	$	—	$	—	$	—	$	933
Sales	—		3,819		97		—		—		—		—		—		3,916

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Repurchase Agreements Accounted for as Secured Borrowings	6 Months Ended
	Jun. 30, 2023
Transfers and Servicing [Abstract]
Repurchase Agreements Accounted for as Secured Borrowings	Repurchase Agreements Accounted for as Secured BorrowingsRepurchase agreements are short-term borrowings included in FHLB Advances and Other Borrowings and mature overnight and continuously. Repurchase agreements, which were secured by mortgage-backed securities, totaled $51,874 and $64,961 as of June 30, 2023 and December 31, 2022, respectively. Risk could arise when the collateral pledged to a repurchase agreement declines in fair value. The Company minimizes risk by consistently monitoring the value of the collateral pledged. At the point in time where the collateral has declined in fair value, the Company is required to provide additional collateral based on the value of the underlying securities.

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Segment Information

6 Months Ended

Jun. 30, 2023

Segment Reporting [Abstract]

Segment Information

Segment Information

The Company’s operations include three primary segments: core banking, wealth management services, and insurance operations. The core banking segment involves attracting deposits from the general public and using such funds to originate consumer, commercial and agricultural, commercial and agricultural real estate, and residential mortgage loans, primarily in the Company’s local markets. The core banking segment also involves the sale of residential mortgage loans in the secondary market. The wealth management segment involves providing trust, investment advisory, brokerage and retirement planning services to customers. The insurance segment offers a full range of personal and corporate property and casualty insurance products, primarily in the Company’s banking subsidiary’s local markets.

The core banking segment is comprised by the Company’s banking subsidiary, German American Bank, which operated through 76 banking offices at June 30, 2023. Net interest income from loans and investments funded by deposits and borrowings is the primary revenue for the core-banking segment. The wealth management segment’s revenues are comprised primarily of fees generated by the trust operations of the Company’s banking subsidiary and by German American Investment Services, Inc. These fees are derived by providing trust, investment advisory, brokerage and retirement planning services to its customers. The insurance segment primarily consists of German American Insurance, Inc., which provides a full line of personal and corporate insurance products. Commissions derived from the sale of insurance products are the primary source of revenue for the insurance segment.

The following segment financial information has been derived from the internal financial statements of the Company which are used by management to monitor and manage financial performance. The accounting policies of the three segments are the same as those of the Company. The evaluation process for segments does not include holding company income and expense. Holding company amounts are the primary differences between segment amounts and consolidated totals, and are reflected in the column labeled “Other” below, along with amounts to eliminate transactions between segments.

	Core Banking		Wealth Management Services		Insurance		Other		Consolidated Totals
Three Months Ended
June 30, 2023
Net Interest Income	$	49,429	$	30	$	15	$	(1,216)	$	48,258
Net Gains on Sales of Loans	630		—		—		—		630
Net Gains on Securities	38		—		—		—		38
Wealth Management Fees	1		2,911		—		—		2,912
Insurance Revenues	1		3		2,126		—		2,130
Noncash Items:
Provision (Benefit) for Credit Losses	550		—		—		—		550
Depreciation and Amortization	2,275		10		12		114		2,411
Income Tax Expense (Benefit)	4,988		161		93		(487)		4,755
Segment Profit (Loss)	21,951		715		247		(790)		22,123
Segment Assets at June 30, 2023	6,045,924		10,225		15,693		(18,573)		6,053,269

	Core Banking		Wealth Management Services		Insurance		Other		Consolidated Totals
Three Months Ended
June 30, 2022
Net Interest Income	$	50,474	$	9	$	3	$	(889)	$	49,597
Net Gains on Sales of Loans	1,049		—		—		—		1,049
Net Gains on Securities	78		—		—		—		78
Wealth Management Fees	1		2,641		—		—		2,642
Insurance Revenues	2		1		2,251		—		2,254
Noncash Items:
Provision (Benefit) for Credit Losses	300		—		—		—		300
Depreciation and Amortization	2,459		11		12		114		2,596
Income Tax Expense (Benefit)	5,129		198		133		(431)		5,029
Segment Profit (Loss)	23,519		617		420		(809)		23,747
Segment Assets at December 31, 2022	6,152,346		8,846		14,706		(19,907)		6,155,991

	Core Banking		Wealth Management Services		Insurance		Other		Consolidated Totals
Six Months Ended
June 30, 2023
Net Interest Income	$	99,570	$	54	$	29	$	(2,386)	$	97,267
Net Gains on Sales of Loans	1,217		—		—		—		1,217
Net Gains on Securities	40		—		—		—		40
Wealth Management Fees	3		5,553		—		—		5,556
Insurance Revenues	1		20		5,244		—		5,265
Noncash Items:
Provision (Benefit) for Credit Losses	1,650		—		—		—		1,650
Depreciation and Amortization	4,568		19		25		228		4,840
Income Tax Expense (Benefit)	9,390		290		320		(792)		9,208
Segment Profit (Loss)	42,515		1,322		1,308		(2,215)		42,930
Segment Assets at June 30, 2023	6,045,924		10,225		15,693		(18,573)		6,053,269

	Core Banking		Wealth Management Services		Insurance		Other		Consolidated Totals
Six Months Ended
June 30, 2022
Net Interest Income	$	98,139	$	14	$	6	$	(1,654)	$	96,505
Net Gains on Sales of Loans	2,470		—		—		—		2,470
Net Gains on Securities	450		—		—		—		450
Wealth Management Fees	2		5,278		—		—		5,280
Insurance Revenues	29		2		5,944		—		5,975
Noncash Items:
Provision (Benefit) for Credit Losses	5,500		—		—		—		5,500
Depreciation and Amortization	4,977		21		24		228		5,250
Income Tax Expense (Benefit)	5,745		402		583		(1,032)		5,698
Segment Profit (Loss)	31,948		1,257		1,849		(2,240)		32,814
Segment Assets at December 31, 2022	6,152,346		8,846		14,706		(19,907)		6,155,991

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Stock Repurchase Plan

6 Months Ended

Jun. 30, 2023

Stockholders' Equity Note [Abstract]

Stock Repurchase Plan

Stock Repurchase Plan

On January 31, 2022, the Company’s Board of Directors approved a plan to repurchase up to 1,000,000 shares of the Company’s outstanding common stock. On a share basis, the amount of common stock subject to the repurchase plan represented approximately 3% of the Company’s outstanding shares at the time it was approved. The Company is not obligated to purchase shares under the plan, and the plan may be discontinued at any time. The actual timing, number and share price of shares purchased under the repurchase plan will be determined by the Company at its discretion and will depend upon such factors as the market price of the stock, general market and economic conditions and applicable legal requirements. At the time it approved the new plan, the Board also terminated a similar plan that had been adopted in January 2021. At the time of its termination, the Company had been authorized to purchase up to 1,000,000 shares of common stock under the 2021 repurchase plan. The Company did not repurchase any shares of common stock under the 2021 repurchase plan and has not repurchased any shares under the 2022 repurchase plan.

In August 2022, the Inflation Reduction Act of 2022 (the “IRA”) was enacted. Among other things, the IRA imposes a new 1% excise tax on the fair value of stock repurchased after December 31, 2022 by publicly traded U.S. corporations, like the Company. With certain exceptions, the value of stock repurchased is determined net of stock issued in the year, including shares issued pursuant to compensatory arrangements.

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Equity Plans and Equity Based Compensation

6 Months Ended

Jun. 30, 2023

Share-Based Payment Arrangement [Abstract]

Equity Plans and Equity Based Compensation

Equity Plans and Equity Based Compensation

During the periods presented, the Company maintained two equity incentive plans under which stock options, restricted stock, and other equity incentive awards could be granted. Those plans include (i) the Company’s 2009 Long-Term Equity Incentive Plan, under which no new grants may be made, and (ii) the Company’s 2019 Long-Term Equity Incentive Plan (the “2019 LTI Plan”). The 2019 LTI Plan, which authorizes a maximum aggregate issuance of 1,000,000 shares of common stock (subject to certain permitted adjustments), became effective on May 16, 2019, following approval of the Company’s shareholders. It will remain in effect until May 16, 2029, or until all shares of common stock subject to the 2019 LTI Plan are distributed, all awards have expired or terminated, or the plan is terminated pursuant to its terms, whichever occurs first.

For the three and six months ended June 30, 2023 and 2022, the Company granted no options.  The Company recorded no stock compensation expense applicable to options during the three and six months ended Junes 30, 2023 and 2022.  In addition, there was no unrecognized option expense. 

During the periods presented, awards of long-term incentives were granted in the form of restricted stock.  In 2019 and prior, awards that were granted to management and selected other employees under the Company's management incentive plan were granted in tandem with cash credit entitlements in the form of 60% restricted stock grants and 40% cash credit entitlements. In

2020, awards granted under the management incentive plan were granted in tandem with cash credit entitlements in the form of 66.67% restricted stock grants and 33.33% cash credit entitlements. In 2019 and prior, the restricted stock grants and tandem cash credit entitlements, generally, vested in three annual installments of 33.33% each. In 2020, 100% of the cash portion of an award vested towards the end of the year in which the grant was made, followed by the restricted stock grants vesting 50% in each of the 2nd and 3rd years. Beginning in 2021, for named executive officers, awards are granted in the form of 100% restricted stock grants which vest in one-third installments on the first, second and third anniversaries of the award date. Awards that are granted to directors as additional retainers for their services do not include any cash credit entitlement. These director restricted stock grants are subject to forfeiture in the event that the recipient of the grant does not continue in service as a director of the Company through December 31 of the year after grant or does not satisfy certain meeting attendance requirements, at which time they generally vest 100%. For measuring compensation costs, restricted stock awards are valued based upon the market value of the common shares on the date of grant. During the three and six months ended June 30, 2023, the Company granted 728 and 81,118 shares, respectively, of restricted stock. During the three months ended June 30, 2022, the Company granted no awards of restricted stock. During the six months ended June 30, 2022, the Company granted 63,258 shares of restricted stock. Total unvested shares of restricted stock at June 30, 2023 and December 31, 2022 were 133,954 and 74,873, respectively.

The following table presents expense recorded for restricted stock and cash entitlements as well as the related tax information for the periods presented:

	Three Months Ended  June 30,
	2023		2022
Restricted Stock Expense	$	830	$	1,093
Cash Entitlement Expense	179		169
Tax Effect	(262)		(327)
Net of Tax	$	747	$	935

	Six Months Ended  June 30,
	2023		2022
Restricted Stock Expense	$	1,369	$	1,517
Cash Entitlement Expense	361		334
Tax Effect	(449)		(480)
Net of Tax	$	1,281	$	1,371

Unrecognized expense associated with the restricted stock grants and cash entitlements totaled $4,490 and $3,503 as of June 30, 2023 and 2022, respectively.

The Company’s shareholders approved the Company’s 2019 Employee Stock Purchase Plan on May 16, 2019, as well as an Amended and Restated 2019 Employee Stock Purchase Plan on May 21, 2020, which was amended and restated to reflect certain clarifying changes (the "2019 ESPP"). The 2019 ESPP replaced the Company's 2009 Employee Stock Purchase Plan, which expired by its own terms on August 16, 2019. The 2019 ESPP provides for a series of 3-month offering periods, commencing on the first day and ending on the last trading day of each calendar quarter, for the purchase of the Company’s common stock by participating employees. The purchase price of the shares has been set at 95% of the fair value of the Company’s common stock on the last trading day of the offering period. A total of 750,000 common shares has been reserved for issuance under the 2019 ESPP. The 2019 ESPP will continue until September 30, 2029, or, if earlier, until all of the shares of common stock allocated to the 2019 ESPP have been purchased. Funding for the purchase of common stock is from employee and Company contributions.

For the three months ended June 30, 2023, the Company recorded $4 of expense related to the employee stock purchase plan resulting in $3 net of tax. For the six months ended June 30, 2023, the Company recorded $16 of expense related to the employee stock purchase plan resulting in $12 net of tax. For the three months ended June 30, 2022, the Company recorded $14 of expense related to the employee stock purchase plan resulting in $10 net of tax. For the six months ended June 30, 2022,

the Company recorded $28 of expense related to the employee stock purchase plan resulting in $21 net of tax. There was no unrecognized compensation expense as of June 30, 2023 and 2022 for the employee stock purchase plan. No stock options were outstanding as of June 30, 2023 and December 31, 2022.

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Fair Value

6 Months Ended

Jun. 30, 2023

Fair Value Disclosures [Abstract]

Fair Value

Fair Value

Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values:

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

The Company used the following methods and significant assumptions to estimate the fair value of each type of financial instrument:

Investment Securities: The fair values for investment securities are determined by quoted market prices, if available (Level 1). For investment securities where quoted prices are not available, fair values are calculated based on market prices of similar investment securities (Level 2). For investment securities where quoted prices or market prices of similar investment securities are not available, fair values are calculated using discounted cash flows or other market indicators (Level 3). Level 3 pricing is obtained from a third-party based upon similar trades that are not traded frequently without adjustment by the Company. At June 30, 2023, the Company held $84 in Level 3 securities which consist of non-rated Obligations of State and Political Subdivisions and $919 in Level 3 securities which consist of non-rated MBS/CMO. Absent the credit rating, significant assumptions must be made such that the credit risk input becomes an unobservable input and thus these investment securities are reported by the Company in a Level 3 classification.

Derivatives: The fair values of derivatives are based on valuation models using observable market data as of the measurement date (Level 2).

Individually Analyzed Loans: Fair values for collateral dependent loans are generally based on appraisals obtained from licensed real estate appraisers and in certain circumstances includes consideration of offers obtained to purchase properties prior to foreclosure. Appraisals for commercial real estate generally use three methods to derive value: cost, sales or market comparison and income approach. The cost method bases value in the cost to replace the current property. Value of market comparison approach evaluates the sales price of similar properties in the same market area. The income approach considers net operating income generated by the property and an investor's required return. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available. Comparable sales adjustments are based on known sales prices of similar type and similar use properties and duration of time that the property has been on the market to sell. Such adjustments made in the appraisal process are typically significant and result in a Level 3 classification of the inputs for determining fair value.

Appraisals for both collateral-dependent loans and other real estate owned are performed by certified general appraisers (for commercial properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by the Company. Once received, a member of the Company’s Risk Management Area reviews the assumptions and approaches utilized in the appraisal. In determining the value of collateral dependent loans and other real estate owned, significant unobservable inputs may be used which include: physical condition of comparable properties sold, net operating income generated by the property and investor rates of return.

Other Real Estate: Nonrecurring adjustments to certain commercial and residential real estate properties classified as other real estate are measured at the lower of carrying amount or fair value, less costs to sell. Fair values are generally based on third party appraisals of the property utilizing similar techniques as discussed above for Individually Analyzed Loans, resulting in a Level 3 classification. In cases where the carrying amount exceeds the fair value, less costs to sell, impairment loss is recognized.

Loans Held-for-Sale: The fair values of loans held for sale are determined by using quoted prices for similar assets, adjusted for specific attributes of that loan resulting in a Level 2 classification.

Assets and Liabilities Measured on a Recurring Basis

Assets and liabilities measured at fair value on a recurring basis, including financial assets and liabilities for which the Company has elected the fair value option, are summarized below:

	Fair Value Measurements at June 30, 2023 Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)		Total
Assets:
U.S. Treasury	$	1,000	$	—	$	—	$	1,000
Obligations of State and Political Subdivisions	—		747,222		84		747,306
MBS/CMO	—		664,950		919		665,869
US Gov’t Sponsored Entities & Agencies	—		186,534		—		186,534
Total Securities	$	1,000	$	1,598,706	$	1,003	$	1,600,709
Loans Held-for-Sale	$	—	$	8,239	$	—	$	8,239
Derivative Assets	$	—	$	9,183	$	—	$	9,183
Derivative Liabilities	$	—	$	9,112	$	—	$	9,112

	Fair Value Measurements at December 31, 2022 Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)		Total
Assets:
U.S. Treasury	$	64,119	$	—	$	—	$	64,119
Obligations of State and Political Subdivisions	—		777,769		83		777,852
MBS/CMO	—		713,775		906		714,681
US Gov’t Sponsored Entities & Agencies	—		205,017		—		205,017
Total Securities	$	64,119	$	1,696,561	$	989	$	1,761,669
Loans Held-for-Sale	$	—	$	8,600	$	—	$	8,600
Derivative Assets	$	—	$	9,899	$	—	$	9,899
Derivative Liabilities	$	—	$	9,749	$	—	$	9,749

As of June 30, 2023 and December 31, 2022, the aggregate fair value, contractual balance (including accrued interest), and gain or loss on Loans Held-for-Sale was as follows:

	June 30, 2023		December 31, 2022
Aggregate Fair Value	$	8,239	$	8,600
Contractual Balance	8,083		8,474
Gain (Loss)	156		126

The total amount of gains and losses from changes in fair value included in earnings for the three months ended June 30, 2023 and 2022 were $59 and $(94), respectively. The total amount of gains and losses from changes in fair value included in earnings for the six months ended June 30, 2023 and 2022 were $30 and $(135), respectively.

The table below presents a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three and six months ended June 30, 2023 and 2022:

	Obligations of State and Political Subdivisions				MBS/CMO
	2023		2022		2023		2022
Balance of Recurring Level 3 Assets at April 1	$	83	$	94	$	917	$	—
Total Gains Included in Other Comprehensive Income	1		—		2		—
Maturities / Calls	—		—		—		—
Acquired through Bank Acquisition	—		—		—		—
Balance of Recurring Level 3 Assets at June 30	$	84	$	94	$	919	$	—

	Obligations of State and Political Subdivisions				MBS/CMO
	2023		2022		2023		2022
Balance of Recurring Level 3 Assets at January 1	$	83	$	—	$	906	$	—
Total Gains Included in Other Comprehensive Income	1		—		13		—
Maturities / Calls	—		—		—		—
Acquired through Bank Acquisition	—		94		—		—
Balance of Recurring Level 3 Assets at June 30	$	84	$	94	$	919	$	—

Of the total gain (loss) included in earnings for the three months ended June 30, 2023 and 2022, $3 and $0 was attributable to other changes in fair value, respectively. Of the total gain (loss) included in earnings for the six months ended June 30, 2023 and 2022, $14 and $0 was attributable to other changes in fair value, respectively.

Assets and Liabilities Measured on a Non-Recurring Basis

Assets and liabilities measured at fair value on a non-recurring basis are summarized below:

	Fair Value Measurements at June 30, 2023 Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)		Total
Assets:
Individually Analyzed Loans
Commercial and Industrial Loans	$	—	$	—	$	1,664	$	1,664
Commercial Real Estate Loans	$	—	$	—	$	7,266	$	7,266
Agricultural Loans	$	—	$	—	$	2,919	$	2,919
Consumer Loans	$	—	$	—	$	9	$	9
Home Equity Loans	$	—	$	—	$	362	$	362
Residential Mortgage Loans	$	—	$	—	$	546	$	546

	Fair Value Measurements at December 31, 2022 Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)		Total
Assets:
Individually Analyzed Loans
Commercial and Industrial Loans	$	—	$	—	$	1,858	$	1,858
Commercial Real Estate Loans	$	—	$	—	$	10,040	$	10,040
Agricultural Loans	$	—	$	—	$	2,970	$	2,970
Consumer Loans	$	—	$	—	$	8	$	8
Home Equity Loans	$	—	$	—	$	368	$	368
Residential Mortgage Loans	$	—	$	—	$	718	$	718

The following tables present quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at June 30, 2023 and December 31, 2022:

June 30, 2023	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Individual Analyzed Loans -     Commercial and Industrial Loans	$	1,664	Sales comparison approach	Adjustment for physical condition of comparable properties sold	0%-100% (40%)
Individual Analyzed Loans -     Commercial Real Estate Loans	$	7,266	Sales comparison approach	Adjustment for physical condition of comparable properties sold	25%-68% (36%)
Individual Analyzed Loans -     Agricultural Loans	$	2,919	Sales comparison approach	Adjustment for physical condition of comparable properties sold	30%-100% (50%)
Individual Analyzed Loans -     Consumer Loans	$	9	Sales comparison approach	Adjustment for physical condition of comparable properties sold	20%-27% (20%)
Individual Analyzed Loans -     Home Equity Loans	$	362	Sales comparison approach	Adjustment for physical condition of comparable properties sold	20%-20% (20%)
Individual Analyzed Loans -     Residential Mortgage Loans	$	546	Sales comparison approach	Adjustment for physical condition of comparable properties sold	20%-100% (20%)

December 31, 2022	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Individual Analyzed Loans -     Commercial and Industrial Loans	$	1,858	Sales comparison approach	Adjustment for physical condition of comparable properties sold	0%-100% (40%)
Individual Analyzed Loans -     Commercial Real Estate Loans	$	10,040	Sales comparison approach	Adjustment for physical condition of comparable properties sold	30%-100% (37%)
Individual Analyzed Loans -     Agricultural Loans	$	2,970	Sales comparison approach	Adjustment for physical condition of comparable properties sold	30%-100% (48%)
Individual Analyzed Loans -     Consumer Loans	$	8	Sales comparison approach	Adjustment for physical condition of comparable properties sold	27%-100% (20%)
Individual Analyzed Loans -     Home Equity Loans	$	368	Sales comparison approach	Adjustment for physical condition of comparable properties sold	20%-51% (20%)
Individual Analyzed Loans -     Residential Mortgage Loans	$	718	Sales comparison approach	Adjustment for physical condition of comparable properties sold	20%-100% (21%)

The carrying amounts and estimated fair values of the Company’s financial instruments not previously presented are provided in the tables below for the periods ending June 30, 2023 and December 31, 2022. Not all of the Company’s assets and liabilities are considered financial instruments, and therefore are not included in the tables. Because no active market exists for a significant portion of the Company’s financial instruments, fair value estimates were based on subjective judgments, and therefore cannot be determined with precision.

			Fair Value Measurements at June 30, 2023 Using
	Carrying Value		Level 1		Level 2		Level 3		Total
Financial Assets:
Cash and Short-term Investments	$	140,671	$	78,223	$	62,448	$	—	$	140,671
Interest Bearing Time Deposits with Banks	500		—		500		—		500
Loans, Net	3,768,977		—		—		3,691,120		3,691,120
Accrued Interest Receivable	25,996		—		10,143		15,853		25,996
Financial Liabilities:
Demand, Savings, and Money Market Deposits	(4,596,960)		(4,596,960)		—		—		(4,596,960)
Time Deposits	(582,745)		—		(578,094)		—		(578,094)
Short-term Borrowings	(99,674)		(47,800)		(51,874)		—		(99,674)
Long-term Debt	(127,810)		—		(51,978)		(71,893)		(123,871)
Accrued Interest Payable	(3,896)		—		(3,534)		(362)		(3,896)

			Fair Value Measurements at December 31, 2022 Using
	Carrying Value		Level 1		Level 2		Level 3		Total
Financial Assets:
Cash and Short-term Investments	$	119,079	$	77,174	$	41,905	$	—	$	119,079
Interest Bearing Time Deposits with Banks	500		—		500		—		500
Loans, Net	3,724,804		—		—		3,688,903		3,688,903
Accrued Interest Receivable	27,741		38		10,863		16,840		27,741
Financial Liabilities:
Demand, Savings, and Money Market Deposits	(4,921,582)		(4,921,582)		—		—		(4,921,582)
Time Deposits	(428,469)		—		(426,184)		—		(426,184)
Short-term Borrowings	(101,161)		(36,200)		(64,961)		—		(101,161)
Long-term Debt	(102,645)		—		(26,830)		(72,272)		(99,102)
Accrued Interest Payable	(1,513)		—		(1,205)		(308)		(1,513)

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Other Comprehensive Income (Loss)

6 Months Ended

Jun. 30, 2023

Equity [Abstract]

Other Comprehensive Income (Loss)

Other Comprehensive Income (Loss)

The tables below summarize the changes in accumulated other comprehensive income (loss) by component for the three and six months ended June 30, 2023 and 2022, net of tax:

June 30, 2023	Unrealized Gains and Losses on Available-for-Sale Securities		Postretirement Benefit Items		Total
Beginning Balance at April 1, 2023	$	(229,978)	$	(514)	$	(230,492)
Other Comprehensive Income (Loss) Before Reclassification	(18,330)		—		(18,330)
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(30)		—		(30)
Net Current Period Other Comprehensive Income (Loss)	(18,360)		—		(18,360)
Ending Balance at June 30, 2023	$	(248,338)	$	(514)	$	(248,852)

June 30, 2023	Unrealized Gains and Losses on Available-for-Sale Securities		Postretirement Benefit Items		Total
Beginning Balance at January 1, 2023	$	(262,924)	$	(514)	$	(263,438)
Other Comprehensive Income (Loss) Before Reclassification	14,618		—		14,618
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(32)		—		(32)
Net Current Period Other Comprehensive Income (Loss)	14,586		—		14,586
Ending Balance at June 30, 2023	$	(248,338)	$	(514)	$	(248,852)

June 30, 2022	Unrealized Gains and Losses on Available-for-Sale Securities		Postretirement Benefit Items		Total
Beginning Balance at April 1, 2022	$	(117,833)	$	(568)	$	(118,401)
Other Comprehensive Income (Loss) Before Reclassification	(92,632)		—		(92,632)
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(62)		—		(62)
Net Current Period Other Comprehensive Income (Loss)	(92,694)		—		(92,694)
Ending Balance at June 30, 2022	$	(210,527)	$	(568)	$	(211,095)

June 30, 2022	Unrealized Gains and Losses on Available-for-Sale Securities		Postretirement Benefit Items		Total
Beginning Balance at January 1, 2022	$	16,052	$	(568)	$	15,484
Other Comprehensive Income (Loss) Before Reclassification	(226,223)		—		(226,223)
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(356)		—		(356)
Net Current Period Other Comprehensive Income (Loss)	(226,579)		—		(226,579)
Ending Balance at June 30, 2022	$	(210,527)	$	(568)	$	(211,095)

The tables below summarize the classifications out of accumulated other comprehensive income (loss) by component for the three and six months ended June 30, 2023 and 2022:

Details about Accumulated Other Comprehensive Income (Loss) Components	Amount Reclassified From Accumulated Other Comprehensive Income (Loss)		Affected Line Item in the Statement Where Net Income is Presented
Unrealized Gains and Losses on     Available-for-Sale Securities	$	38	Net Gains on Securities
	(8)		Income Tax Expense
	30		Net of Tax
Total Reclassifications for the Three     Months Ended June 30, 2023	$	30

Details about Accumulated Other Comprehensive Income (Loss) Components	Amount Reclassified From Accumulated Other Comprehensive Income (Loss)		Affected Line Item in the Statement Where Net Income is Presented
Unrealized Gains and Losses on     Available-for-Sale Securities	$	40	Net Gains on Securities
	(8)		Income Tax Expense
	32		Net of Tax
Total Reclassifications for the Six     Months Ended June 30, 2023	$	32

Details about Accumulated Other Comprehensive Income (Loss) Components	Amount Reclassified From Accumulated Other Comprehensive Income (Loss)		Affected Line Item in the Statement Where Net Income is Presented
Unrealized Gains and Losses on     Available-for-Sale Securities	$	78	Net Gains on Securities
	(16)		Income Tax Expense
	62		Net of Tax
Total Reclassifications for the Three     Months Ended June 30, 2022	$	62

Details about Accumulated Other Comprehensive Income (Loss) Components	Amount Reclassified From Accumulated Other Comprehensive Income (Loss)		Affected Line Item in the Statement Where Net Income is Presented
Unrealized Gains and Losses on     Available-for-Sale Securities	$	450	Net Gains on Securities
	(94)		Income Tax Expense
	356		Net of Tax
Total Reclassifications for the Six     Months Ended June 30, 2022	$	356

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Revenue Recognition

6 Months Ended

Jun. 30, 2023

Revenue from Contract with Customer [Abstract]

Revenue Recognition

Revenue Recognition

The following table presents non-interest income, segregated by revenue streams in-scope and out-of-scope of FASB ASU No. 2014-09, "Revenue from Contracts with Customers (Topic 606)", for the three and six months ended June 30, 2023 and 2022. Wealth management fees are included in the wealth management services segment while insurance revenues are included in the insurance segment. All other revenue streams are primarily included in the banking segment.

	Three Months Ended
	June 30,
Non-interest Income	2023		2022
In-Scope of Topic 606:
Wealth Management Fees	$	2,912	$	2,642
Service Charges on Deposit Accounts	2,883		2,871
Insurance Revenues	2,130		2,254
Interchange Fee Income	4,412		4,167
Other Operating Income	823		820
Non-interest Income (in-scope of Topic 606)	13,160		12,754
Non-interest Income (out-of-scope of Topic 606)	1,736		2,426
Total Non-interest Income	$	14,896	$	15,180

	Six Months Ended
	June 30,
Non-interest Income	2023		2022
In-Scope of Topic 606:
Wealth Management Fees	$	5,556	$	5,280
Service Charges on Deposit Accounts	5,671		5,554
Insurance Revenues	5,265		5,975
Interchange Fee Income	8,611		7,794
Other Operating Income	1,576		1,578
Non-interest Income (in-scope of Topic 606)	26,679		26,181
Non-interest Income (out-of-scope of Topic 606)	3,184		5,187
Total Non-interest Income	$	29,863	$	31,368

A description of the Company’s revenue streams accounted for under Topic 606 follows:

Service Charges on Deposit Accounts: The Company earns fees from its deposit customers for transaction-based, account maintenance, and overdraft services. Transaction-based fees, which include services such as stop payment charges and statement rendering, are recognized at the time the transaction is executed (the point in time the Company fills the customer's request). Account maintenance fees, which relate primarily to monthly maintenance, are earned over the course of a month, representing the period over which the Company satisfies the performance obligation. Overdraft fees are recognized at the point in time that the overdraft occurs.

Interchange Fee Income: The Company earns interchange fees from debit/credit cardholder transactions conducted through various payment networks. Interchange fees from cardholder transactions represent a percentage of the underlying transaction value and are recognized daily, concurrently with the transaction processing services provided to the cardholder.

Wealth Management Fees: The Company earns wealth management fees from its contracts with trust and brokerage customers to manage assets for investment and/or to transact their accounts. These fees are primarily earned over time as the Company provides the contracted monthly or quarterly services and are generally assessed based on the market value of assets under management at month-end. Fees that are transaction based, including trade execution services, are recognized at the point in time that the transaction is executed (trade date).

Insurance Revenues: The Company earns insurance revenue from commissions derived from the sale of personal and corporate property and casualty insurance products. These commissions are primarily earned over time as the Company provides the contracted insurance product to customers.

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Leases

6 Months Ended

Jun. 30, 2023

Leases [Abstract]

Leases

Leases

At the inception of a contract, an entity should determine whether the contract contains a lease. Topic 842 defines a lease as a contract, or part of a contract, that conveys the right to control the use of identified property, plant, or equipment (an identified asset) for a period of time in exchange for consideration. Control over the use of an identified asset means that the customer has both (1) the right to obtain substantially all of the economic benefits from the use of the asset and (2) the right to direct the use of the asset.

The Bank has finance leases for branch offices as well as operating leases for branch offices, ATM locations and certain office equipment. The right-of-use asset is included in the 'Premises, Furniture and Equipment, Net' line of the Consolidated Balance Sheet. The lease liability is included in the 'Accrued Interest Payable and Other Liabilities' line of the Consolidated Balance Sheet.

The Company used the implicit lease rate when determining the present value of lease payments for finance leases. The present value of lease payments for operating leases was determined using the incremental borrowing rate as of the date the Company adopted this standard.

The components of lease expense were as follows:

	Three Months Ended		Three Months Ended
	June 30, 2023		June 30, 2022
Finance Lease Cost:
Amortization of Right-of -Use Assets	$	52	$	53
Interest on Lease Liabilities	77		82
Operating Lease Cost	363		376
Short-term Lease Cost	—		3
Total Lease Cost	$	492	$	514

	Six Months Ended		Six Months Ended
	June 30, 2023		June 30, 2022
Finance Lease Cost:
Amortization of Right-of -Use Assets	$	105	$	105
Interest on Lease Liabilities	155		165
Operating Lease Cost	736		745
Short-term Lease Cost	—		27
Total Lease Cost	$	996	$	1,042

The weighted average lease term and discount rates were as follows:

	June 30, 2023		June 30, 2022
Weighted Average Remaining Lease Term:
Finance Leases	9 years		10 years
Operating Leases	7 years		8 years
Weighted Average Discount Rate:
Finance Leases	11.39	%	11.43	%
Operating Leases	2.84	%	2.85	%

Supplemental balance sheet information related to leases were as follows:

	June 30, 2023		June 30, 2022
Finance Leases
Premises, Furniture and Equipment, Net	$	1,753	$	1,963
Other Borrowings	2,753		2,957
Operating Leases
Operating Lease Right-of-Use Assets	$	5,674	$	6,510
Operating Lease Liabilities	5,816		6,645

Supplemental cash flow information related to leases were as follows:

	Six Months Ended		Six Months Ended
	June 30, 2023		June 30, 2022
Cash paid for amounts in the Measurement of Lease Liabilities:
Operating Cash Flows from Finance Leases	$	155	$	166
Operating Cash Flows from Operating Leases	722		701
Financing Cash Flows from Finance Leases	101		91

The following table presents a maturity analysis of Finance and Operating Lease Liabilities:

	June 30, 2023
	Finance Leases		Operating Leases
Year 1	$	519	$	1,272
Year 2	519		1,134
Year 3	519		890
Year 4	519		756
Year 5	445		627
Thereafter	1,728		1,798
Total Lease Payments	4,249		6,477
Less Imputed Interest	(1,496)		(661)
Total	$	2,753	$	5,816

Leases

Leases

At the inception of a contract, an entity should determine whether the contract contains a lease. Topic 842 defines a lease as a contract, or part of a contract, that conveys the right to control the use of identified property, plant, or equipment (an identified asset) for a period of time in exchange for consideration. Control over the use of an identified asset means that the customer has both (1) the right to obtain substantially all of the economic benefits from the use of the asset and (2) the right to direct the use of the asset.

The Bank has finance leases for branch offices as well as operating leases for branch offices, ATM locations and certain office equipment. The right-of-use asset is included in the 'Premises, Furniture and Equipment, Net' line of the Consolidated Balance Sheet. The lease liability is included in the 'Accrued Interest Payable and Other Liabilities' line of the Consolidated Balance Sheet.

The Company used the implicit lease rate when determining the present value of lease payments for finance leases. The present value of lease payments for operating leases was determined using the incremental borrowing rate as of the date the Company adopted this standard.

The components of lease expense were as follows:

	Three Months Ended		Three Months Ended
	June 30, 2023		June 30, 2022
Finance Lease Cost:
Amortization of Right-of -Use Assets	$	52	$	53
Interest on Lease Liabilities	77		82
Operating Lease Cost	363		376
Short-term Lease Cost	—		3
Total Lease Cost	$	492	$	514

	Six Months Ended		Six Months Ended
	June 30, 2023		June 30, 2022
Finance Lease Cost:
Amortization of Right-of -Use Assets	$	105	$	105
Interest on Lease Liabilities	155		165
Operating Lease Cost	736		745
Short-term Lease Cost	—		27
Total Lease Cost	$	996	$	1,042

The weighted average lease term and discount rates were as follows:

	June 30, 2023		June 30, 2022
Weighted Average Remaining Lease Term:
Finance Leases	9 years		10 years
Operating Leases	7 years		8 years
Weighted Average Discount Rate:
Finance Leases	11.39	%	11.43	%
Operating Leases	2.84	%	2.85	%

Supplemental balance sheet information related to leases were as follows:

	June 30, 2023		June 30, 2022
Finance Leases
Premises, Furniture and Equipment, Net	$	1,753	$	1,963
Other Borrowings	2,753		2,957
Operating Leases
Operating Lease Right-of-Use Assets	$	5,674	$	6,510
Operating Lease Liabilities	5,816		6,645

Supplemental cash flow information related to leases were as follows:

	Six Months Ended		Six Months Ended
	June 30, 2023		June 30, 2022
Cash paid for amounts in the Measurement of Lease Liabilities:
Operating Cash Flows from Finance Leases	$	155	$	166
Operating Cash Flows from Operating Leases	722		701
Financing Cash Flows from Finance Leases	101		91

The following table presents a maturity analysis of Finance and Operating Lease Liabilities:

	June 30, 2023
	Finance Leases		Operating Leases
Year 1	$	519	$	1,272
Year 2	519		1,134
Year 3	519		890
Year 4	519		756
Year 5	445		627
Thereafter	1,728		1,798
Total Lease Payments	4,249		6,477
Less Imputed Interest	(1,496)		(661)
Total	$	2,753	$	5,816

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Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2022	Mar. 31, 2022	Jun. 30, 2023	Jun. 30, 2022
Pay vs Performance Disclosure
NET INCOME	$ 22,123	$ 20,807	$ 23,747	$ 9,067	$ 42,930	$ 32,814

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Insider Trading Arrangements	3 Months Ended
	Jun. 30, 2023
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

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Recent Accounting Pronouncements (Policies)

6 Months Ended

Jun. 30, 2023

Accounting Policies [Abstract]

Basis of Presentation

The accounting and reporting policies of German American Bancorp, Inc. and its subsidiaries (hereinafter collectively referred to as the "Company") conform to U.S. generally accepted accounting principles. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted. All adjustments which are, in the opinion of management, necessary for a fair presentation of the results for the periods reported have been included in the accompanying unaudited consolidated financial statements, and all such adjustments are of a normal recurring nature.

Recently Adopted Accounting Guidance and Newly Issued But Not Yet Effective Accounting Standards

Recently Adopted Accounting Guidance

In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting”. These amendments provide temporary optional guidance to ease the potential burden in accounting for reference rate reform. The ASU provides optional expedients and exceptions for applying generally accepted accounting principles to contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued. It is intended to help stakeholders during the global market-wide reference rate transition period. In January 2021, the FASB issued ASU 2021-01 which clarifies that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The guidance is effective for all entities as of March 12, 2020 through December 31, 2024. The Company has discontinued originating LIBOR based loans and has a plan in place to transition LIBOR indexed loans primarily to term SOFR or other indices.

On March 31, 2022, the FASB issued ASU 2022-02, “Financial Instruments - Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures” which eliminates the troubled debt restructuring recognition and measurement guidance and instead requires an entity to evaluate whether the modification represents a new loan or a continuation of an existing loan. The amendments also enhance existing disclosures and include new disclosure requirements related to certain modifications of receivables made to borrowers experiencing financial difficulty. To improve consistency for vintage disclosures, the ASU requires that public business entities disclose current-period gross write-offs by year of origination for financing receivables and net investments in leases within the scope of Subtopic 326-20. For entities that have adopted ASU 2016-13, the amendments are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. For entities that have not adopted ASU 2016-13, the effective dates for the amendments are the same as the effective dates in ASU 2016-13. Early adoption is permitted if ASU 2016-13 has been adopted, including adoption in an interim period. If an entity elects to adopt the amendments in an interim period, the guidance should be applied as of the beginning of the fiscal year that includes the interim period. The Company adopted the new guidance prospectively with no material impact to the consolidated financial statements.

The SEC released Staff Accounting Bulletin No. 121 (“SAB 121”) on March 31, 2022, which provides interpretive guidance regarding the accounting for obligations to safeguard crypto-assets an entity holds for its customers, either directly, through an agent or through another third party acting on its behalf. SAB 121 requires an entity to recognize a liability on its balance sheet to reflect the obligation to safeguard the crypto-assets of others, along with a corresponding safeguarding asset, both of which are measured at fair value. The Company has completed an evaluation and concluded that it does not have a safeguarding obligation under SAB 121 and therefore the disclosures do not apply.

Newly Issued But Not Yet Effective Accounting Standards

On March 29, 2023, the FASB issued ASU 2023-02, "Investments - Equity Method and Joint Ventures (Topic 323): Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method" to expand use of the proportional amortization method of accounting to equity investments in tax credit programs beyond those in low-income-housing tax credit (LIHTC) programs. The amendments in this update permit reporting entities to account for certain tax equity

investments, regardless of the tax credit program from which the income tax credits are received, using the proportional amortization method if certain conditions are met. This guidance provides clarifications to address interpretive issues and prescribes specific information that reporting entities must disclose about tax credit investments each period.

This ASU is effective for reporting periods beginning after December 15, 2023, for public business entities. For all other entities, the ASU is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted, included early adoption in any interim period as of the beginning of the fiscal year that includes that interim period. Entities have the option of applying the forthcoming revisions using either a modified retrospective or retrospective adoption approach. The Company is currently evaluating the impact of adopting this new guidance, however, adoption of the standard is not expected to have a material impact on the Company's financial statements or disclosures.

Credit Quality Indicators

Credit Quality Indicators:

The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company classifies loans as to credit risk by individually analyzing loans. This analysis includes commercial and industrial loans, commercial real estate loans, and agricultural loans with an outstanding balance greater than $250. This analysis is typically performed on at least an annual basis. The Company uses the following definitions for risk ratings:

Special Mention. Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.

Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass rated loans.

Allowance for Credit Losses for Loans

The Company utilizes the Static Pool methodology in determining expected future credit losses. Static pool analysis means segmenting and tracking loans over a period of time based on similar risk characteristics such as loan structure, collateral type, industry of borrower and concentrations, contractual terms and credit risk indicators. Static pool calculates a loss rate on a closed pool of loans that existed on a specified start date based upon the remaining life of each segment.

The Company’s expected loss estimate is anchored in historical credit loss experience, with an emphasis on all available portfolio data. The Company's historical look-back period includes January 2014 through the current period, on a monthly basis.

Qualitative reserves reflect management’s overall estimate of the extent to which current expected credit losses on collectively evaluated loans will differ from historical loss experience. The analysis takes into consideration industry and collateral concentrations, acquired loan portfolio characteristics and other credit-related analytics as deemed appropriate. Management attempts to quantify qualitative reserves by anchoring to specific data points when possible.

The Company estimates the allowance balance using relevant available information, from internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts. Historical loss experience provides the basis for the estimation of expected credit losses. Adjustments to historical loss information are made for changes in underwriting standards, portfolio mix, delinquency level, changes in environmental conditions, unemployment rates, risk classifications and collateral values. The allowance for credit losses is measured on a collective (pooled) basis when similar risk characteristics exist. Based on the potential increased losses related to the advancing stress on the economy as a result of inflationary pressures, rising interest rates and financial market volatility, the Company has considered this loss experience may align with loss experience from the recessionary period from 2008-2011 and qualitative adjustments have been made accordingly.

Loans that do not share risk characteristics are evaluated on an individual basis. Loans evaluated individually are not included in the collective evaluation. When the borrower is experiencing financial difficulty at the reporting date and repayment is expected to be provided substantially through the operation or sale of the collateral, expected credit losses are based on the fair value of the collateral at the reporting date adjusted for selling costs.

For the six months ended June 30, 2023, the allowance for credit losses increased slightly compared to December 31, 2022. The Company saw improvement in individually analyzed loans and added reserve for loan portfolio growth. Key indicators utilized in forecasting for the allowance calculations include unemployment rates and gross domestic product as well as commodity prices for the agricultural segment of the portfolio. There has been some improvement in these factors over previous periods; however, rising interest rates and the expanded inflationary impact on consumer discretionary spending were considered in the qualitative factors to determine the allowance for credit losses.

All classes of loans, including loans acquired with deteriorated credit quality, are generally placed on non-accrual status when scheduled principal or interest payments are past due for 90 days or more or when the borrower’s ability to repay becomes doubtful. For purchased loans, the determination is made at the time of acquisition as well as over the life of the loan. Uncollected accrued interest for each class of loans is reversed against income at the time a loan is placed on non-accrual. Interest received on such loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual. All classes of loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. Loans are typically charged-off at 180 days past due, or earlier if deemed uncollectible. Exceptions to the non-accrual and charge-off policies are made when the loan is well secured and in the process of collection.

The Company considers the performance of the loan portfolio and its impact on the allowance for credit loan losses. For certain retail loan classes, the Company also evaluates credit quality based on the aging status of the loan, which was previously presented, and by payment activity.

Segment Information

Segment Information

The Company’s operations include three primary segments: core banking, wealth management services, and insurance operations. The core banking segment involves attracting deposits from the general public and using such funds to originate consumer, commercial and agricultural, commercial and agricultural real estate, and residential mortgage loans, primarily in the Company’s local markets. The core banking segment also involves the sale of residential mortgage loans in the secondary market. The wealth management segment involves providing trust, investment advisory, brokerage and retirement planning services to customers. The insurance segment offers a full range of personal and corporate property and casualty insurance products, primarily in the Company’s banking subsidiary’s local markets.

The core banking segment is comprised by the Company’s banking subsidiary, German American Bank, which operated through 76 banking offices at June 30, 2023. Net interest income from loans and investments funded by deposits and borrowings is the primary revenue for the core-banking segment. The wealth management segment’s revenues are comprised primarily of fees generated by the trust operations of the Company’s banking subsidiary and by German American Investment Services, Inc. These fees are derived by providing trust, investment advisory, brokerage and retirement planning services to its customers. The insurance segment primarily consists of German American Insurance, Inc., which provides a full line of personal and corporate insurance products. Commissions derived from the sale of insurance products are the primary source of revenue for the insurance segment.

Fair Value

Fair Value

Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values:

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

The Company used the following methods and significant assumptions to estimate the fair value of each type of financial instrument:

Investment Securities: The fair values for investment securities are determined by quoted market prices, if available (Level 1). For investment securities where quoted prices are not available, fair values are calculated based on market prices of similar investment securities (Level 2). For investment securities where quoted prices or market prices of similar investment securities are not available, fair values are calculated using discounted cash flows or other market indicators (Level 3). Level 3 pricing is obtained from a third-party based upon similar trades that are not traded frequently without adjustment by the Company. At June 30, 2023, the Company held $84 in Level 3 securities which consist of non-rated Obligations of State and Political Subdivisions and $919 in Level 3 securities which consist of non-rated MBS/CMO. Absent the credit rating, significant assumptions must be made such that the credit risk input becomes an unobservable input and thus these investment securities are reported by the Company in a Level 3 classification.

Derivatives: The fair values of derivatives are based on valuation models using observable market data as of the measurement date (Level 2).

Individually Analyzed Loans: Fair values for collateral dependent loans are generally based on appraisals obtained from licensed real estate appraisers and in certain circumstances includes consideration of offers obtained to purchase properties prior to foreclosure. Appraisals for commercial real estate generally use three methods to derive value: cost, sales or market comparison and income approach. The cost method bases value in the cost to replace the current property. Value of market comparison approach evaluates the sales price of similar properties in the same market area. The income approach considers net operating income generated by the property and an investor's required return. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available. Comparable sales adjustments are based on known sales prices of similar type and similar use properties and duration of time that the property has been on the market to sell. Such adjustments made in the appraisal process are typically significant and result in a Level 3 classification of the inputs for determining fair value.

Appraisals for both collateral-dependent loans and other real estate owned are performed by certified general appraisers (for commercial properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by the Company. Once received, a member of the Company’s Risk Management Area reviews the assumptions and approaches utilized in the appraisal. In determining the value of collateral dependent loans and other real estate owned, significant unobservable inputs may be used which include: physical condition of comparable properties sold, net operating income generated by the property and investor rates of return.

Other Real Estate: Nonrecurring adjustments to certain commercial and residential real estate properties classified as other real estate are measured at the lower of carrying amount or fair value, less costs to sell. Fair values are generally based on third party appraisals of the property utilizing similar techniques as discussed above for Individually Analyzed Loans, resulting in a Level 3 classification. In cases where the carrying amount exceeds the fair value, less costs to sell, impairment loss is recognized.

Loans Held-for-Sale: The fair values of loans held for sale are determined by using quoted prices for similar assets, adjusted for specific attributes of that loan resulting in a Level 2 classification.

Revenue Recognition

A description of the Company’s revenue streams accounted for under Topic 606 follows:

Service Charges on Deposit Accounts: The Company earns fees from its deposit customers for transaction-based, account maintenance, and overdraft services. Transaction-based fees, which include services such as stop payment charges and statement rendering, are recognized at the time the transaction is executed (the point in time the Company fills the customer's request). Account maintenance fees, which relate primarily to monthly maintenance, are earned over the course of a month, representing the period over which the Company satisfies the performance obligation. Overdraft fees are recognized at the point in time that the overdraft occurs.

Interchange Fee Income: The Company earns interchange fees from debit/credit cardholder transactions conducted through various payment networks. Interchange fees from cardholder transactions represent a percentage of the underlying transaction value and are recognized daily, concurrently with the transaction processing services provided to the cardholder.

Wealth Management Fees: The Company earns wealth management fees from its contracts with trust and brokerage customers to manage assets for investment and/or to transact their accounts. These fees are primarily earned over time as the Company provides the contracted monthly or quarterly services and are generally assessed based on the market value of assets under management at month-end. Fees that are transaction based, including trade execution services, are recognized at the point in time that the transaction is executed (trade date).

Insurance Revenues: The Company earns insurance revenue from commissions derived from the sale of personal and corporate property and casualty insurance products. These commissions are primarily earned over time as the Company provides the contracted insurance product to customers.

Leases

Leases

At the inception of a contract, an entity should determine whether the contract contains a lease. Topic 842 defines a lease as a contract, or part of a contract, that conveys the right to control the use of identified property, plant, or equipment (an identified asset) for a period of time in exchange for consideration. Control over the use of an identified asset means that the customer has both (1) the right to obtain substantially all of the economic benefits from the use of the asset and (2) the right to direct the use of the asset.

The Bank has finance leases for branch offices as well as operating leases for branch offices, ATM locations and certain office equipment. The right-of-use asset is included in the 'Premises, Furniture and Equipment, Net' line of the Consolidated Balance Sheet. The lease liability is included in the 'Accrued Interest Payable and Other Liabilities' line of the Consolidated Balance Sheet.

The Company used the implicit lease rate when determining the present value of lease payments for finance leases. The present value of lease payments for operating leases was determined using the incremental borrowing rate as of the date the Company adopted this standard.

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Per Share Data (Tables)

6 Months Ended

Jun. 30, 2023

Earnings Per Share [Abstract]

Schedule of Computations of Basic Earnings per Share and Diluted Earnings per Share

The computation of Basic Earnings per Share and Diluted Earnings per Share are as follows:

	Three Months Ended  June 30,
	2023		2022
Basic Earnings per Share:
Net Income	$	22,123	$	23,747
Weighted Average Shares Outstanding	29,573,042		29,483,848
Basic Earnings per Share	$	0.75	$	0.81
Diluted Earnings per Share:
Net Income	$	22,123	$	23,747
Weighted Average Shares Outstanding	29,573,042		29,483,848
Potentially Dilutive Shares, Net	—		—
Diluted Weighted Average Shares Outstanding	29,573,042		29,483,848
Diluted Earnings per Share	$	0.75	$	0.81

For the three months ended June 30, 2023 and 2022, there were no anti-dilutive shares.

	Six Months Ended  June 30,
	2023		2022
Basic Earnings per Share:
Net Income	$	42,930	$	32,814
Weighted Average Shares Outstanding	29,540,425		29,443,673
Basic Earnings per Share	$	1.45	$	1.11
Diluted Earnings per Share:
Net Income	$	42,930	$	32,814
Weighted Average Shares Outstanding	29,540,425		29,443,673
Potentially Dilutive Shares, Net	—		—
Diluted Weighted Average Shares Outstanding	29,540,425		29,443,673
Diluted Earnings per Share	$	1.45	$	1.11

For the six months ended June 30, 2023 and 2022, there were no anti-dilutive shares.

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Securities (Tables)

6 Months Ended

Jun. 30, 2023

Investments, Debt and Equity Securities [Abstract]

Schedule of Securities Available-for-Sale

The amortized cost, unrealized gross gains and losses recognized in accumulated other comprehensive income (loss), and fair value of securities available-for-sale were as follows:

Securities Available-for-Sale:	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value
June 30, 2023
U.S. Treasury	$	999	$	1	$	—	$	—	$	1,000
Obligations of State and Political Subdivisions	894,264		487		(147,445)		—		747,306
MBS/CMO	793,915		—		(128,046)		—		665,869
US Gov’t Sponsored Entities & Agencies	226,223		—		(39,689)		—		186,534
Total	$	1,915,401	$	488	$	(315,180)	$	—	$	1,600,709
December 31, 2022
U.S. Treasury	$	64,097	$	22	$	—	$	—	$	64,119
Obligations of State and Political Subdivisions	939,193		673		(162,014)		—		777,852
MBS/CMO	846,519		—		(131,838)		—		714,681
US Gov’t Sponsored Entities & Agencies	245,017		—		(40,000)		—		205,017
Total	$	2,094,826	$	695	$	(333,852)	$	—	$	1,761,669

Schedule of Securities by Contractual Maturity

The amortized cost and fair value of securities available-for-sale at June 30, 2023 by contractual maturity are shown below. Expected maturities may differ from contractual maturities because some issuers have the right to call or prepay certain obligations with or without call or prepayment penalties. Mortgage-backed Securities are not due at a single maturity date and are shown separately.

Securities Available-for-Sale:	Amortized Cost		Fair Value
Due in one year or less	$	2,964	$	2,963
Due after one year through five years	15,119		15,106
Due after five years through ten years	53,731		51,246
Due after ten years	823,449		678,991
MBS/CMO	793,915		665,869
US Gov’t Sponsored Entities & Agencies	226,223		186,534
Total	$	1,915,401	$	1,600,709

Schedule of Proceeds from the Sales of Securities

Proceeds from the Sales of Securities are summarized below:

	Three Months Ended		Three Months Ended
	June 30, 2023		June 30, 2022
Proceeds from Sales	$	20,507	$	5,554
Gross Gains on Sales	38		78
Income Taxes on Gross Gains	8		16

	Six Months Ended		Six Months Ended
	June 30, 2023		June 30, 2022
Proceeds from Sales	$	114,259	$	97,500
Gross Gains on Sales	40		450
Income Taxes on Gross Gains	8		94

Schedule of Securities with Unrealized Losses

Below is a summary of securities with unrealized losses as of June 30, 2023 and December 31, 2022, presented by length of time the securities have been in a continuous unrealized loss position:

	Less than 12 Months				12 Months or More				Total
June 30, 2023	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
U.S. Treasury	$	—	$	—	$	—	$	—	$	—	$	—
Obligations of State and Political Subdivisions	59,277		(688)		646,205		(146,757)		705,482		(147,445)
MBS/CMO	23,202		(1,315)		642,660		(126,731)		665,862		(128,046)
US Gov’t Sponsored Entities & Agencies	—		—		186,534		(39,689)		186,534		(39,689)
Total	$	82,479	$	(2,003)	$	1,475,399	$	(313,177)	$	1,557,878	$	(315,180)

	Less than 12 Months				12 Months or More				Total
December 31, 2022	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
U.S. Treasury	$	—	$	—	$	—	$	—	$	—	$	—
Obligations of State and Political Subdivisions	579,267		(117,423)		122,992		(44,591)		702,259		(162,014)
MBS/CMO	240,344		(20,920)		474,327		(110,918)		714,671		(131,838)
US Gov’t Sponsored Entities & Agencies	198,702		(38,818)		6,314		(1,182)		205,016		(40,000)
Total	$	1,018,313	$	(177,161)	$	603,633	$	(156,691)	$	1,621,946	$	(333,852)

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Derivatives (Tables)

6 Months Ended

Jun. 30, 2023

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Fair Value of Interest Rate Swaps Included in Consolidated Balance Sheets

The following table reflects the fair value of derivative instruments included in the Consolidated Balance Sheets as of:

	June 30, 2023				December 31, 2022
	Notional Amount		Fair Value		Notional Amount		Fair Value
Included in Other Assets:
Interest Rate Swaps	$	135,113	$	9,183	$	134,684	$	9,899
Included in Other Liabilities:
Interest Rate Swaps	$	135,113	$	9,112	$	134,684	$	9,749

Schedule of Effect of Derivative Instruments Consolidated Statements of Income

The following table presents the effect of derivative instruments on the Consolidated Statements of Income for the periods presented:

	Three Months Ended  June 30,				Six Months Ended  June 30,
	2023		2022		2023		2022
Interest Rate Swaps:
Included in Other Operating Income	$	227	$	130	$	178	$	344

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Loans (Tables)

6 Months Ended

Jun. 30, 2023

Receivables [Abstract]

Schedule of Loans Classifications

Loans were comprised of the following classifications:

	June 30, 2023		December 31, 2022
Commercial:
Commercial and Industrial Loans	$	608,284	$	620,106
Commercial Real Estate Loans	2,021,109		1,966,884
Agricultural Loans	395,466		417,413
Leases	60,853		56,396
Retail:
Home Equity Loans	284,517		279,748
Consumer Loans	85,595		79,904
Credit Cards	19,328		17,512
Residential Mortgage Loans	355,329		350,682
Subtotal	3,830,481		3,788,645
Less: Unearned Income	(4,472)		(3,711)
Allowance for Credit Losses	(44,266)		(44,168)
Loans, net	$	3,781,743	$	3,740,766

Schedule of Allowance for Credit Losses for Loans

The following tables present the activity in the allowance for credit losses by portfolio segment for the three months ended June 30, 2023 and 2022:

June 30, 2023	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Unallocated		Total
Allowance for Credit Losses:
Beginning balance	$	13,572	$	22,062	$	3,887	$	227	$	609	$	1,415	$	263	$	2,280	$	—	$	44,315
Provision (Benefit) for credit loss expense	244		(233)		94		8		174		45		157		61		—		550
Loans charged-off	(343)		—		(25)		—		(284)		(25)		(141)		(31)		—		(849)
Recoveries collected	94		5		—		—		141		1		9		—		—		250
Total ending allowance balance	$	13,567	$	21,834	$	3,956	$	235	$	640	$	1,436	$	288	$	2,310	$	—	$	44,266

June 30, 2022	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Unallocated		Total
Allowance for Credit Losses:
Beginning balance	$	12,720	$	23,217	$	4,759	$	196	$	616	$	1,207	$	212	$	2,151	$	—	$	45,078
Provision (Benefit) for credit loss expense	874		(873)		(131)		(5)		293		41		73		28		—		300
Loans charged-off	(56)		—		—		—		(322)		(15)		(51)		(3)		—		(447)
Recoveries collected	7		5		—		—		81		—		5		2		—		100
Total ending allowance balance	$	13,545	$	22,349	$	4,628	$	191	$	668	$	1,233	$	239	$	2,178	$	—	$	45,031

The following tables present the activity in the allowance for credit losses by portfolio segment for the six months ended June 30, 2023 and 2022:

June 30, 2023	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Unallocated		Total
Allowance for Credit Losses:
Beginning balance	$	13,749	$	21,598	$	4,188	$	209	$	595	$	1,344	$	257	$	2,228	$	—	$	44,168
Provision (Benefit) for credit loss expense	746		169		(207)		26		399		100		281		136		—		1,650
Loans charged-off	(1,077)		—		(25)		—		(628)		(39)		(261)		(57)		—		(2,087)
Recoveries collected	149		67		—		—		274		31		11		3		—		535
Total ending allowance balance	$	13,567	$	21,834	$	3,956	$	235	$	640	$	1,436	$	288	$	2,310	$	—	$	44,266

June 30, 2022	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Unallocated		Total
Allowance for Credit Losses:
Beginning balance	$	9,554	$	19,245	$	4,505	$	200	$	507	$	1,061	$	240	$	1,705	$	—	$	37,017
Acquisition of Citizens Union Bank of Shelbyville, KY	376		1,945		689		—		2		—		—		105		—		3,117
Provision (Benefit) for credit loss expense	3,662		1,223		(566)		(9)		518		224		79		369		—		5,500
Loans charged-off	(61)		(78)		—		—		(532)		(52)		(90)		(3)		—		(816)
Recoveries collected	14		14		—		—		173		—		10		2		—		213
Total ending allowance balance	$	13,545	$	22,349	$	4,628	$	191	$	668	$	1,233	$	239	$	2,178	$	—	$	45,031

Schedule of Non-Accrual and Past Due Loans

The following tables present the amortized cost in non-accrual loans and loans past due over 89 days still accruing by class of loans as of June 30, 2023 and December 31, 2022:

June 30, 2023	Non-Accrual With No Allowance for Credit Loss (1)		Total Non-Accrual		Loans Past Due Over 89 Days Still Accruing
Commercial and Industrial Loans	$	620	$	7,577	$	1,000
Commercial Real Estate Loans	425		1,178		—
Agricultural Loans	906		1,252		—
Leases	—		—		—
Home Equity Loans	449		503		—
Consumer Loans	18		18		—
Credit Cards	119		119		—
Residential Mortgage Loans	431		776		—
Total	$	2,968	$	11,423	$	1,000

(1) Non-accrual loans with no allowance for credit loss and are also included in Total Non-Accrual loans of $11,423.

December 31, 2022	Non-Accrual With No Allowance for Credit Loss (1)		Total Non-Accrual		Loans Past Due Over 89 Days Still Accruing
Commercial and Industrial Loans	$	1,142	$	7,936	$	1,427
Commercial Real Estate Loans	49		1,950		—
Agricultural Loans	994		1,062		—
Leases	—		—		—
Home Equity Loans	262		310		—
Consumer Loans	240		254		—
Credit Cards	146		146		—
Residential Mortgage Loans	676		1,230		—
Total	$	3,509	$	12,888	$	1,427

(1) Includes non-accrual loans with no allowance for credit loss and are also included in Total Non-Accrual loans of $12,888.

Schedule or Collateral-dependent Loans by Class

The following tables present the amortized cost basis of collateral-dependent loans by class of loans as of June 30, 2023 and December 31, 2022:

June 30, 2023	Real Estate		Equipment		Accounts Receivable		Other		Total
Commercial and Industrial Loans	$	2,005	$	216	$	—	$	6,849	$	9,070
Commercial Real Estate Loans	9,050		35		—		—		9,085
Agricultural Loans	4,160		288		—		—		4,448
Leases	—		—		—		—		—
Home Equity Loans	475		—		—		—		475
Consumer Loans	8		1		—		—		9
Credit Cards	—		—		—		—		—
Residential Mortgage Loans	860		—		—		—		860
Total	$	16,558	$	540	$	—	$	6,849	$	23,947

December 31, 2022	Real Estate		Equipment		Accounts Receivable		Other		Total
Commercial and Industrial Loans	$	2,078	$	1,219	$	272	$	5,851	$	9,420
Commercial Real Estate Loans	12,192		36		—		—		12,228
Agricultural Loans	4,944		318		—		—		5,262
Leases	—		—		—		—		—
Home Equity Loans	467		—		—		—		467
Consumer Loans	8		2		—		12		22
Credit Cards	—		—		—		—		—
Residential Mortgage Loans	1,060		—		—		—		1,060
Total	$	20,749	$	1,575	$	272	$	5,863	$	28,459

Schedule of Aging of Past Due Loans

The following tables present the aging of the amortized cost basis in past due loans by class of loans as of June 30, 2023 and December 31, 2022:

June 30, 2023	30-59 Days Past Due		60-89 Days Past Due		Greater Than 89 Days Past Due		Total Past Due		Loans Not Past Due		Total
Commercial and Industrial Loans	$	96	$	49	$	8,110	$	8,255	$	600,029	$	608,284
Commercial Real Estate Loans	710		599		1,009		2,318		2,018,791		2,021,109
Agricultural Loans	632		590		780		2,002		393,464		395,466
Leases	—		—		—		—		60,853		60,853
Home Equity Loans	1,163		89		503		1,755		282,762		284,517
Consumer Loans	133		42		17		192		85,403		85,595
Credit Cards	94		22		119		235		19,093		19,328
Residential Mortgage Loans	6,072		966		557		7,595		347,734		355,329
Total	$	8,900	$	2,357	$	11,095	$	22,352	$	3,808,129	$	3,830,481

December 31, 2022	30-59 Days Past Due		60-89 Days Past Due		Greater Than 89 Days Past Due		Total Past Due		Loans Not Past Due		Total
Commercial and Industrial Loans	$	268	$	681	$	8,285	$	9,234	$	610,872	$	620,106
Commercial Real Estate Loans	1,617		14		616		2,247		1,964,637		1,966,884
Agricultural Loans	343		—		123		466		416,947		417,413
Leases	—		—		—		—		56,396		56,396
Home Equity Loans	1,770		140		310		2,220		277,528		279,748
Consumer Loans	219		64		252		535		79,369		79,904
Credit Cards	86		24		146		256		17,256		17,512
Residential Mortgage Loans	6,330		2,783		1,051		10,164		340,518		350,682
Total	$	10,633	$	3,706	$	10,783	$	25,122	$	3,763,523	$	3,788,645

Schedule of Risk Category of Loans

Based on the analysis performed at June 30, 2023 and December 31, 2022, the risk category of loans by class of loans is as follows:

	Term Loans Amortized Cost Basis by Origination Year
As of June 30, 2023	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Commercial and Industrial:
Risk Rating
Pass	$	54,328	$	146,823	$	97,546	$	33,668	$	39,516	$	60,729	$	144,955	$	577,565
Special Mention	—		55		446		589		650		1,504		5,182		8,426
Substandard	25		530		5,248		550		1,156		2,145		12,639		22,293
Doubtful	—		—		—		—		—		—		—		—
Total Commercial & Industrial Loans	$	54,353	$	147,408	$	103,240	$	34,807	$	41,322	$	64,378	$	162,776	$	608,284
Current Period Gross Charge-Offs	$	—	$	861	$	32	$	33	$	—	$	50	$	101	$	1,077
Commercial Real Estate:
Risk Rating
Pass	$	151,013	$	411,741	$	488,764	$	232,238	$	153,101	$	499,661	$	32,722	$	1,969,240
Special Mention	13,647		836		948		4,774		243		20,191		—		40,639
Substandard	—		205		5,349		672		1,123		3,501		380		11,230
Doubtful	—		—		—		—		—		—		—		—
Total Commercial Real Estate Loans	$	164,660	$	412,782	$	495,061	$	237,684	$	154,467	$	523,353	$	33,102	$	2,021,109
Current Period Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Agricultural:
Risk Rating
Pass	$	24,291	$	59,278	$	43,841	$	44,708	$	23,191	$	107,131	$	61,116	$	363,556
Special Mention	1,617		333		1,028		5,856		2,593		10,950		4,159		26,536
Substandard	—		—		206		622		335		4,211		—		5,374
Doubtful	—		—		—		—		—		—		—		—
Total Agricultural Loans	$	25,908	$	59,611	$	45,075	$	51,186	$	26,119	$	122,292	$	65,275	$	395,466
Current Period Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	25	$	—	$	25
Leases:
Risk Rating
Pass	$	15,188	$	15,821	$	12,454	$	7,925	$	7,142	$	2,323	$	—	$	60,853
Special Mention	—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Total Leases	$	15,188	$	15,821	$	12,454	$	7,925	$	7,142	$	2,323	$	—	$	60,853
Current Period Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

	Term Loans Amortized Cost Basis by Origination Year
As of December 31, 2022	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Total
Commercial and Industrial:
Risk Rating
Pass	$	156,318	$	117,648	$	39,949	$	46,505	$	18,423	$	51,482	$	154,203	$	584,528
Special Mention	56		148		577		78		551		2,346		1,672		5,428
Substandard	1,714		5,629		849		1,304		1,028		2,237		17,389		30,150
Doubtful	—		—		—		—		—		—		—		—
Total Commercial & Industrial Loans	$	158,088	$	123,425	$	41,375	$	47,887	$	20,002	$	56,065	$	173,264	$	620,106
Commercial Real Estate:
Risk Rating
Pass	$	398,631	$	490,747	$	261,462	$	162,701	$	129,151	$	427,433	$	35,163	$	1,905,288
Special Mention	3,982		1,568		4,612		135		13,689		25,371		—		49,357
Substandard	—		4,628		489		1,415		979		4,728		—		12,239
Doubtful	—		—		—		—		—		—		—		—
Total Commercial Real Estate Loans	$	402,613	$	496,943	$	266,563	$	164,251	$	143,819	$	457,532	$	35,163	$	1,966,884
Agricultural:
Risk Rating
Pass	$	62,673	$	47,682	$	47,355	$	25,431	$	21,728	$	92,344	$	83,862	$	381,075
Special Mention	634		842		6,066		4,149		2,355		11,440		4,310		29,796
Substandard	—		210		628		429		85		5,190		—		6,542
Doubtful	—		—		—		—		—		—		—		—
Total Agricultural Loans	$	63,307	$	48,734	$	54,049	$	30,009	$	24,168	$	108,974	$	88,172	$	417,413
Leases:
Risk Rating
Pass	$	20,057	$	14,461	$	9,648	$	8,901	$	1,851	$	1,478	$	—	$	56,396
Special Mention	—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Total Leases	$	20,057	$	14,461	$	9,648	$	8,901	$	1,851	$	1,478	$	—	$	56,396

Schedule of Residential, Home Equity and Consumer Loans Based on Payment Activity

The following tables present the amortized cost in residential, home equity and consumer loans based on payment activity.

	Term Loans Amortized Cost Basis by Origination Year
As of June 30, 2023	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Total
Consumer:
Payment performance
Performing	$	29,474	$	32,598	$	13,564	$	4,116	$	1,412	$	2,456	$	1,957	$	85,577
Nonperforming	—		7		10		—		—		1		—		18
Total Consumer Loans	$	29,474	$	32,605	$	13,574	$	4,116	$	1,412	$	2,457	$	1,957	$	85,595
Current Period Gross Charge-Offs	$	554	$	24	$	20	$	19	$	3	$	1	$	7	$	628
Home Equity:
Payment performance
Performing	$	—	$	75	$	86	$	90	$	24	$	960	$	282,779	$	284,014
Nonperforming	—		40		252		—		44		99		68		503
Total Home Equity Loans	$	—	$	115	$	338	$	90	$	68	$	1,059	$	282,847	$	284,517
Current Period Gross Charge-Offs	$	—	$	—	$	—	$	—	$	—	$	24	$	15	$	39
Residential Mortgage:
Payment performance
Performing	$	28,513	$	68,601	$	90,501	$	43,591	$	18,887	$	104,460	$	—	$	354,553
Nonperforming	—		—		140		124		108		404		—		776
Total Residential Mortgage Loans	$	28,513	$	68,601	$	90,641	$	43,715	$	18,995	$	104,864	$	—	$	355,329
Current Period Gross Charge-Offs	$	—	$	—	$	21	$	36	$	—	$	—	$	—	$	57

	Term Loans Amortized Cost Basis by Origination Year
As of December 31, 2022	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Total
Consumer:
Payment performance
Performing	$	42,685	$	22,708	$	5,610	$	2,394	$	1,543	$	1,553	$	3,157	$	79,650
Nonperforming	3		19		212		8		2		10		—		254
Total Consumer Loans	$	42,688	$	22,727	$	5,822	$	2,402	$	1,545	$	1,563	$	3,157	$	79,904
Home Equity:
Payment performance
Performing	$	63	$	—	$	—	$	—	$	—	$	591	$	278,784	$	279,438
Nonperforming	—		20		—		—		19		1		270		310
Total Home Equity Loans	$	63	$	20	$	—	$	—	$	19	$	592	$	279,054	$	279,748
Residential Mortgage:
Payment performance
Performing	$	69,982	$	97,176	$	46,851	$	20,080	$	16,664	$	98,699	$	—	$	349,452
Nonperforming	—		161		253		—		78		738		—		1,230
Total Residential Mortgage Loans	$	69,982	$	97,337	$	47,104	$	20,080	$	16,742	$	99,437	$	—	$	350,682

Schedule of Recorded Investment in Credit Cards Based on Payment Activity

The following table presents the recorded investment in credit cards based on payment activity:

Credit Cards	June 30, 2023		December 31, 2022
Performing	$	19,209	$	17,366
Nonperforming	119		146
Total	$	19,328	$	17,512

Schedule of Loans Purchased and/or Sold During the Year

The following tables present loans purchased and/or sold during the year by portfolio segment and excludes the business combination activity:

June 30, 2023	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Total
Purchases	$	—	$	173	$	—	$	—	$	—	$	—	$	—	$	—	$	173
Sales	—		—		—		—		—		—		—		—		—

December 31, 2022	Commercial and Industrial Loans		Commercial Real Estate Loans		Agricultural Loans		Leases		Consumer Loans		Home Equity Loans		Credit Cards		Residential Mortgage Loans		Total
Purchases	$	522	$	411	$	—	$	—	$	—	$	—	$	—	$	—	$	933
Sales	—		3,819		97		—		—		—		—		—		3,916

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Segment Information (Tables)

6 Months Ended

Jun. 30, 2023

Segment Reporting [Abstract]

Schedule of Segment Financial Information

The following segment financial information has been derived from the internal financial statements of the Company which are used by management to monitor and manage financial performance. The accounting policies of the three segments are the same as those of the Company. The evaluation process for segments does not include holding company income and expense. Holding company amounts are the primary differences between segment amounts and consolidated totals, and are reflected in the column labeled “Other” below, along with amounts to eliminate transactions between segments.

	Core Banking		Wealth Management Services		Insurance		Other		Consolidated Totals
Three Months Ended
June 30, 2023
Net Interest Income	$	49,429	$	30	$	15	$	(1,216)	$	48,258
Net Gains on Sales of Loans	630		—		—		—		630
Net Gains on Securities	38		—		—		—		38
Wealth Management Fees	1		2,911		—		—		2,912
Insurance Revenues	1		3		2,126		—		2,130
Noncash Items:
Provision (Benefit) for Credit Losses	550		—		—		—		550
Depreciation and Amortization	2,275		10		12		114		2,411
Income Tax Expense (Benefit)	4,988		161		93		(487)		4,755
Segment Profit (Loss)	21,951		715		247		(790)		22,123
Segment Assets at June 30, 2023	6,045,924		10,225		15,693		(18,573)		6,053,269

	Core Banking		Wealth Management Services		Insurance		Other		Consolidated Totals
Three Months Ended
June 30, 2022
Net Interest Income	$	50,474	$	9	$	3	$	(889)	$	49,597
Net Gains on Sales of Loans	1,049		—		—		—		1,049
Net Gains on Securities	78		—		—		—		78
Wealth Management Fees	1		2,641		—		—		2,642
Insurance Revenues	2		1		2,251		—		2,254
Noncash Items:
Provision (Benefit) for Credit Losses	300		—		—		—		300
Depreciation and Amortization	2,459		11		12		114		2,596
Income Tax Expense (Benefit)	5,129		198		133		(431)		5,029
Segment Profit (Loss)	23,519		617		420		(809)		23,747
Segment Assets at December 31, 2022	6,152,346		8,846		14,706		(19,907)		6,155,991

	Core Banking		Wealth Management Services		Insurance		Other		Consolidated Totals
Six Months Ended
June 30, 2023
Net Interest Income	$	99,570	$	54	$	29	$	(2,386)	$	97,267
Net Gains on Sales of Loans	1,217		—		—		—		1,217
Net Gains on Securities	40		—		—		—		40
Wealth Management Fees	3		5,553		—		—		5,556
Insurance Revenues	1		20		5,244		—		5,265
Noncash Items:
Provision (Benefit) for Credit Losses	1,650		—		—		—		1,650
Depreciation and Amortization	4,568		19		25		228		4,840
Income Tax Expense (Benefit)	9,390		290		320		(792)		9,208
Segment Profit (Loss)	42,515		1,322		1,308		(2,215)		42,930
Segment Assets at June 30, 2023	6,045,924		10,225		15,693		(18,573)		6,053,269

	Core Banking		Wealth Management Services		Insurance		Other		Consolidated Totals
Six Months Ended
June 30, 2022
Net Interest Income	$	98,139	$	14	$	6	$	(1,654)	$	96,505
Net Gains on Sales of Loans	2,470		—		—		—		2,470
Net Gains on Securities	450		—		—		—		450
Wealth Management Fees	2		5,278		—		—		5,280
Insurance Revenues	29		2		5,944		—		5,975
Noncash Items:
Provision (Benefit) for Credit Losses	5,500		—		—		—		5,500
Depreciation and Amortization	4,977		21		24		228		5,250
Income Tax Expense (Benefit)	5,745		402		583		(1,032)		5,698
Segment Profit (Loss)	31,948		1,257		1,849		(2,240)		32,814
Segment Assets at December 31, 2022	6,152,346		8,846		14,706		(19,907)		6,155,991

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Equity Plans and Equity Based Compensation (Tables)

6 Months Ended

Jun. 30, 2023

Share-Based Payment Arrangement [Abstract]

Schedule of Expense Recorded for Restricted Stock and Cash Entitlements

The following table presents expense recorded for restricted stock and cash entitlements as well as the related tax information for the periods presented:

	Three Months Ended  June 30,
	2023		2022
Restricted Stock Expense	$	830	$	1,093
Cash Entitlement Expense	179		169
Tax Effect	(262)		(327)
Net of Tax	$	747	$	935

	Six Months Ended  June 30,
	2023		2022
Restricted Stock Expense	$	1,369	$	1,517
Cash Entitlement Expense	361		334
Tax Effect	(449)		(480)
Net of Tax	$	1,281	$	1,371

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Fair Value (Tables)

6 Months Ended

Jun. 30, 2023

Fair Value Disclosures [Abstract]

Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis

Assets and liabilities measured at fair value on a recurring basis, including financial assets and liabilities for which the Company has elected the fair value option, are summarized below:

	Fair Value Measurements at June 30, 2023 Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)		Total
Assets:
U.S. Treasury	$	1,000	$	—	$	—	$	1,000
Obligations of State and Political Subdivisions	—		747,222		84		747,306
MBS/CMO	—		664,950		919		665,869
US Gov’t Sponsored Entities & Agencies	—		186,534		—		186,534
Total Securities	$	1,000	$	1,598,706	$	1,003	$	1,600,709
Loans Held-for-Sale	$	—	$	8,239	$	—	$	8,239
Derivative Assets	$	—	$	9,183	$	—	$	9,183
Derivative Liabilities	$	—	$	9,112	$	—	$	9,112

	Fair Value Measurements at December 31, 2022 Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)		Total
Assets:
U.S. Treasury	$	64,119	$	—	$	—	$	64,119
Obligations of State and Political Subdivisions	—		777,769		83		777,852
MBS/CMO	—		713,775		906		714,681
US Gov’t Sponsored Entities & Agencies	—		205,017		—		205,017
Total Securities	$	64,119	$	1,696,561	$	989	$	1,761,669
Loans Held-for-Sale	$	—	$	8,600	$	—	$	8,600
Derivative Assets	$	—	$	9,899	$	—	$	9,899
Derivative Liabilities	$	—	$	9,749	$	—	$	9,749

Schedule of Aggregate Fair Value, Contractual Balance and Gain (Loss) of Loans Held-for-Sale

As of June 30, 2023 and December 31, 2022, the aggregate fair value, contractual balance (including accrued interest), and gain or loss on Loans Held-for-Sale was as follows:

	June 30, 2023		December 31, 2022
Aggregate Fair Value	$	8,239	$	8,600
Contractual Balance	8,083		8,474
Gain (Loss)	156		126

Schedule of Reconciliation of all Assets Measured at Fair Value on Recurring Basis, Using Significant Unobservable Inputs (Level 3)

The table below presents a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three and six months ended June 30, 2023 and 2022:

	Obligations of State and Political Subdivisions				MBS/CMO
	2023		2022		2023		2022
Balance of Recurring Level 3 Assets at April 1	$	83	$	94	$	917	$	—
Total Gains Included in Other Comprehensive Income	1		—		2		—
Maturities / Calls	—		—		—		—
Acquired through Bank Acquisition	—		—		—		—
Balance of Recurring Level 3 Assets at June 30	$	84	$	94	$	919	$	—

	Obligations of State and Political Subdivisions				MBS/CMO
	2023		2022		2023		2022
Balance of Recurring Level 3 Assets at January 1	$	83	$	—	$	906	$	—
Total Gains Included in Other Comprehensive Income	1		—		13		—
Maturities / Calls	—		—		—		—
Acquired through Bank Acquisition	—		94		—		—
Balance of Recurring Level 3 Assets at June 30	$	84	$	94	$	919	$	—

Schedule of Assets and Liabilities Measured at Fair Value on Non-Recurring Basis

Assets and liabilities measured at fair value on a non-recurring basis are summarized below:

	Fair Value Measurements at June 30, 2023 Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)		Total
Assets:
Individually Analyzed Loans
Commercial and Industrial Loans	$	—	$	—	$	1,664	$	1,664
Commercial Real Estate Loans	$	—	$	—	$	7,266	$	7,266
Agricultural Loans	$	—	$	—	$	2,919	$	2,919
Consumer Loans	$	—	$	—	$	9	$	9
Home Equity Loans	$	—	$	—	$	362	$	362
Residential Mortgage Loans	$	—	$	—	$	546	$	546

	Fair Value Measurements at December 31, 2022 Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)		Total
Assets:
Individually Analyzed Loans
Commercial and Industrial Loans	$	—	$	—	$	1,858	$	1,858
Commercial Real Estate Loans	$	—	$	—	$	10,040	$	10,040
Agricultural Loans	$	—	$	—	$	2,970	$	2,970
Consumer Loans	$	—	$	—	$	8	$	8
Home Equity Loans	$	—	$	—	$	368	$	368
Residential Mortgage Loans	$	—	$	—	$	718	$	718

Schedule of Fair Value Assets and Liabilities Measured on Nonrecurring Basis Valuation Techniques

The following tables present quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at June 30, 2023 and December 31, 2022:

June 30, 2023	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Individual Analyzed Loans -     Commercial and Industrial Loans	$	1,664	Sales comparison approach	Adjustment for physical condition of comparable properties sold	0%-100% (40%)
Individual Analyzed Loans -     Commercial Real Estate Loans	$	7,266	Sales comparison approach	Adjustment for physical condition of comparable properties sold	25%-68% (36%)
Individual Analyzed Loans -     Agricultural Loans	$	2,919	Sales comparison approach	Adjustment for physical condition of comparable properties sold	30%-100% (50%)
Individual Analyzed Loans -     Consumer Loans	$	9	Sales comparison approach	Adjustment for physical condition of comparable properties sold	20%-27% (20%)
Individual Analyzed Loans -     Home Equity Loans	$	362	Sales comparison approach	Adjustment for physical condition of comparable properties sold	20%-20% (20%)
Individual Analyzed Loans -     Residential Mortgage Loans	$	546	Sales comparison approach	Adjustment for physical condition of comparable properties sold	20%-100% (20%)

December 31, 2022	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Individual Analyzed Loans -     Commercial and Industrial Loans	$	1,858	Sales comparison approach	Adjustment for physical condition of comparable properties sold	0%-100% (40%)
Individual Analyzed Loans -     Commercial Real Estate Loans	$	10,040	Sales comparison approach	Adjustment for physical condition of comparable properties sold	30%-100% (37%)
Individual Analyzed Loans -     Agricultural Loans	$	2,970	Sales comparison approach	Adjustment for physical condition of comparable properties sold	30%-100% (48%)
Individual Analyzed Loans -     Consumer Loans	$	8	Sales comparison approach	Adjustment for physical condition of comparable properties sold	27%-100% (20%)
Individual Analyzed Loans -     Home Equity Loans	$	368	Sales comparison approach	Adjustment for physical condition of comparable properties sold	20%-51% (20%)
Individual Analyzed Loans -     Residential Mortgage Loans	$	718	Sales comparison approach	Adjustment for physical condition of comparable properties sold	20%-100% (21%)

Schedule of Carrying Amounts and Estimated Fair Values of Company's Financial Instruments

The carrying amounts and estimated fair values of the Company’s financial instruments not previously presented are provided in the tables below for the periods ending June 30, 2023 and December 31, 2022. Not all of the Company’s assets and liabilities are considered financial instruments, and therefore are not included in the tables. Because no active market exists for a significant portion of the Company’s financial instruments, fair value estimates were based on subjective judgments, and therefore cannot be determined with precision.

			Fair Value Measurements at June 30, 2023 Using
	Carrying Value		Level 1		Level 2		Level 3		Total
Financial Assets:
Cash and Short-term Investments	$	140,671	$	78,223	$	62,448	$	—	$	140,671
Interest Bearing Time Deposits with Banks	500		—		500		—		500
Loans, Net	3,768,977		—		—		3,691,120		3,691,120
Accrued Interest Receivable	25,996		—		10,143		15,853		25,996
Financial Liabilities:
Demand, Savings, and Money Market Deposits	(4,596,960)		(4,596,960)		—		—		(4,596,960)
Time Deposits	(582,745)		—		(578,094)		—		(578,094)
Short-term Borrowings	(99,674)		(47,800)		(51,874)		—		(99,674)
Long-term Debt	(127,810)		—		(51,978)		(71,893)		(123,871)
Accrued Interest Payable	(3,896)		—		(3,534)		(362)		(3,896)

			Fair Value Measurements at December 31, 2022 Using
	Carrying Value		Level 1		Level 2		Level 3		Total
Financial Assets:
Cash and Short-term Investments	$	119,079	$	77,174	$	41,905	$	—	$	119,079
Interest Bearing Time Deposits with Banks	500		—		500		—		500
Loans, Net	3,724,804		—		—		3,688,903		3,688,903
Accrued Interest Receivable	27,741		38		10,863		16,840		27,741
Financial Liabilities:
Demand, Savings, and Money Market Deposits	(4,921,582)		(4,921,582)		—		—		(4,921,582)
Time Deposits	(428,469)		—		(426,184)		—		(426,184)
Short-term Borrowings	(101,161)		(36,200)		(64,961)		—		(101,161)
Long-term Debt	(102,645)		—		(26,830)		(72,272)		(99,102)
Accrued Interest Payable	(1,513)		—		(1,205)		(308)		(1,513)

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Other Comprehensive Income (Loss) (Tables)

6 Months Ended

Jun. 30, 2023

Equity [Abstract]

Schedule of Changes in Accumulated Other Comprehensive Income (Loss)

The tables below summarize the changes in accumulated other comprehensive income (loss) by component for the three and six months ended June 30, 2023 and 2022, net of tax:

June 30, 2023	Unrealized Gains and Losses on Available-for-Sale Securities		Postretirement Benefit Items		Total
Beginning Balance at April 1, 2023	$	(229,978)	$	(514)	$	(230,492)
Other Comprehensive Income (Loss) Before Reclassification	(18,330)		—		(18,330)
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(30)		—		(30)
Net Current Period Other Comprehensive Income (Loss)	(18,360)		—		(18,360)
Ending Balance at June 30, 2023	$	(248,338)	$	(514)	$	(248,852)

June 30, 2023	Unrealized Gains and Losses on Available-for-Sale Securities		Postretirement Benefit Items		Total
Beginning Balance at January 1, 2023	$	(262,924)	$	(514)	$	(263,438)
Other Comprehensive Income (Loss) Before Reclassification	14,618		—		14,618
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(32)		—		(32)
Net Current Period Other Comprehensive Income (Loss)	14,586		—		14,586
Ending Balance at June 30, 2023	$	(248,338)	$	(514)	$	(248,852)

June 30, 2022	Unrealized Gains and Losses on Available-for-Sale Securities		Postretirement Benefit Items		Total
Beginning Balance at April 1, 2022	$	(117,833)	$	(568)	$	(118,401)
Other Comprehensive Income (Loss) Before Reclassification	(92,632)		—		(92,632)
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(62)		—		(62)
Net Current Period Other Comprehensive Income (Loss)	(92,694)		—		(92,694)
Ending Balance at June 30, 2022	$	(210,527)	$	(568)	$	(211,095)

June 30, 2022	Unrealized Gains and Losses on Available-for-Sale Securities		Postretirement Benefit Items		Total
Beginning Balance at January 1, 2022	$	16,052	$	(568)	$	15,484
Other Comprehensive Income (Loss) Before Reclassification	(226,223)		—		(226,223)
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(356)		—		(356)
Net Current Period Other Comprehensive Income (Loss)	(226,579)		—		(226,579)
Ending Balance at June 30, 2022	$	(210,527)	$	(568)	$	(211,095)

Schedule of Classifications Out of Accumulated Other Comprehensive Income (Loss)

The tables below summarize the classifications out of accumulated other comprehensive income (loss) by component for the three and six months ended June 30, 2023 and 2022:

Details about Accumulated Other Comprehensive Income (Loss) Components	Amount Reclassified From Accumulated Other Comprehensive Income (Loss)		Affected Line Item in the Statement Where Net Income is Presented
Unrealized Gains and Losses on     Available-for-Sale Securities	$	38	Net Gains on Securities
	(8)		Income Tax Expense
	30		Net of Tax
Total Reclassifications for the Three     Months Ended June 30, 2023	$	30

Details about Accumulated Other Comprehensive Income (Loss) Components	Amount Reclassified From Accumulated Other Comprehensive Income (Loss)		Affected Line Item in the Statement Where Net Income is Presented
Unrealized Gains and Losses on     Available-for-Sale Securities	$	40	Net Gains on Securities
	(8)		Income Tax Expense
	32		Net of Tax
Total Reclassifications for the Six     Months Ended June 30, 2023	$	32

Details about Accumulated Other Comprehensive Income (Loss) Components	Amount Reclassified From Accumulated Other Comprehensive Income (Loss)		Affected Line Item in the Statement Where Net Income is Presented
Unrealized Gains and Losses on     Available-for-Sale Securities	$	78	Net Gains on Securities
	(16)		Income Tax Expense
	62		Net of Tax
Total Reclassifications for the Three     Months Ended June 30, 2022	$	62

Details about Accumulated Other Comprehensive Income (Loss) Components	Amount Reclassified From Accumulated Other Comprehensive Income (Loss)		Affected Line Item in the Statement Where Net Income is Presented
Unrealized Gains and Losses on     Available-for-Sale Securities	$	450	Net Gains on Securities
	(94)		Income Tax Expense
	356		Net of Tax
Total Reclassifications for the Six     Months Ended June 30, 2022	$	356

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Revenue Recognition (Tables)

6 Months Ended

Jun. 30, 2023

Revenue from Contract with Customer [Abstract]

Schedule of Non-interest Income, Segregated by Revenue Stream

The following table presents non-interest income, segregated by revenue streams in-scope and out-of-scope of FASB ASU No. 2014-09, "Revenue from Contracts with Customers (Topic 606)", for the three and six months ended June 30, 2023 and 2022. Wealth management fees are included in the wealth management services segment while insurance revenues are included in the insurance segment. All other revenue streams are primarily included in the banking segment.

	Three Months Ended
	June 30,
Non-interest Income	2023		2022
In-Scope of Topic 606:
Wealth Management Fees	$	2,912	$	2,642
Service Charges on Deposit Accounts	2,883		2,871
Insurance Revenues	2,130		2,254
Interchange Fee Income	4,412		4,167
Other Operating Income	823		820
Non-interest Income (in-scope of Topic 606)	13,160		12,754
Non-interest Income (out-of-scope of Topic 606)	1,736		2,426
Total Non-interest Income	$	14,896	$	15,180

	Six Months Ended
	June 30,
Non-interest Income	2023		2022
In-Scope of Topic 606:
Wealth Management Fees	$	5,556	$	5,280
Service Charges on Deposit Accounts	5,671		5,554
Insurance Revenues	5,265		5,975
Interchange Fee Income	8,611		7,794
Other Operating Income	1,576		1,578
Non-interest Income (in-scope of Topic 606)	26,679		26,181
Non-interest Income (out-of-scope of Topic 606)	3,184		5,187
Total Non-interest Income	$	29,863	$	31,368

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Leases (Tables)

6 Months Ended

Jun. 30, 2023

Leases [Abstract]

Schedule of Components of Lease Expense, Weighted Average Remaining Lease Term, Discount Rates and Supplemental Cash Flow Information

The components of lease expense were as follows:

	Three Months Ended		Three Months Ended
	June 30, 2023		June 30, 2022
Finance Lease Cost:
Amortization of Right-of -Use Assets	$	52	$	53
Interest on Lease Liabilities	77		82
Operating Lease Cost	363		376
Short-term Lease Cost	—		3
Total Lease Cost	$	492	$	514

	Six Months Ended		Six Months Ended
	June 30, 2023		June 30, 2022
Finance Lease Cost:
Amortization of Right-of -Use Assets	$	105	$	105
Interest on Lease Liabilities	155		165
Operating Lease Cost	736		745
Short-term Lease Cost	—		27
Total Lease Cost	$	996	$	1,042

The weighted average lease term and discount rates were as follows:

	June 30, 2023		June 30, 2022
Weighted Average Remaining Lease Term:
Finance Leases	9 years		10 years
Operating Leases	7 years		8 years
Weighted Average Discount Rate:
Finance Leases	11.39	%	11.43	%
Operating Leases	2.84	%	2.85	%

Supplemental cash flow information related to leases were as follows:

	Six Months Ended		Six Months Ended
	June 30, 2023		June 30, 2022
Cash paid for amounts in the Measurement of Lease Liabilities:
Operating Cash Flows from Finance Leases	$	155	$	166
Operating Cash Flows from Operating Leases	722		701
Financing Cash Flows from Finance Leases	101		91

Schedule of Supplemental Balance Sheet Information

Supplemental balance sheet information related to leases were as follows:

	June 30, 2023		June 30, 2022
Finance Leases
Premises, Furniture and Equipment, Net	$	1,753	$	1,963
Other Borrowings	2,753		2,957
Operating Leases
Operating Lease Right-of-Use Assets	$	5,674	$	6,510
Operating Lease Liabilities	5,816		6,645

Schedule of Maturity of Finance Lease Liabilities

The following table presents a maturity analysis of Finance and Operating Lease Liabilities:

	June 30, 2023
	Finance Leases		Operating Leases
Year 1	$	519	$	1,272
Year 2	519		1,134
Year 3	519		890
Year 4	519		756
Year 5	445		627
Thereafter	1,728		1,798
Total Lease Payments	4,249		6,477
Less Imputed Interest	(1,496)		(661)
Total	$	2,753	$	5,816

Schedule of Maturity of Operating Lease Liabilities

The following table presents a maturity analysis of Finance and Operating Lease Liabilities:

	June 30, 2023
	Finance Leases		Operating Leases
Year 1	$	519	$	1,272
Year 2	519		1,134
Year 3	519		890
Year 4	519		756
Year 5	445		627
Thereafter	1,728		1,798
Total Lease Payments	4,249		6,477
Less Imputed Interest	(1,496)		(661)
Total	$	2,753	$	5,816

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Per Share Data (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2022	Mar. 31, 2022	Jun. 30, 2023	Jun. 30, 2022
Basic Earnings per Share:
Net Income	$ 22,123	$ 20,807	$ 23,747	$ 9,067	$ 42,930	$ 32,814
Weighted Average Shares Outstanding (in shares)	29,573,042		29,483,848		29,540,425	29,443,673
Basic Earnings per Share (in dollars per share)	$ 0.75		$ 0.81		$ 1.45	$ 1.11
Diluted Earnings per Share:
Net Income	$ 22,123	$ 20,807	$ 23,747	$ 9,067	$ 42,930	$ 32,814
Weighted Average Shares Outstanding (in shares)	29,573,042		29,483,848		29,540,425	29,443,673
Potentially Dilutive Shares, Net (in shares)	0		0		0	0
Diluted Weighted Average Shares Outstanding (in shares)	29,573,042		29,483,848		29,540,425	29,443,673
Diluted Earnings per Share (in dollars per share)	$ 0.75		$ 0.81		$ 1.45	$ 1.11
Anti-dilutive securities excluded from computation of earnings per share (in shares)	0		0		0	0

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Securities - Schedule of Securities Available-for-Sale (Details) - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	$ 1,915,401,000	$ 2,094,826,000
Gross Unrealized Gains	488,000	695,000
Gross Unrealized Losses	(315,180,000)	(333,852,000)
Allowance for Credit Losses	0	0
Fair Value	1,600,709,000	1,761,669,000
U.S. Treasury
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	999,000	64,097,000
Gross Unrealized Gains	1,000	22,000
Gross Unrealized Losses	0	0
Allowance for Credit Losses	0	0
Fair Value	1,000,000	64,119,000
Obligations of State and Political Subdivisions
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	894,264,000	939,193,000
Gross Unrealized Gains	487,000	673,000
Gross Unrealized Losses	(147,445,000)	(162,014,000)
Allowance for Credit Losses	0	0
Fair Value	747,306,000	777,852,000
MBS/CMO
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	793,915,000	846,519,000
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(128,046,000)	(131,838,000)
Allowance for Credit Losses	0	0
Fair Value	665,869,000	714,681,000
US Gov’t Sponsored Entities & Agencies
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	226,223,000	245,017,000
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(39,689,000)	(40,000,000)
Allowance for Credit Losses	0	0
Fair Value	$ 186,534,000	$ 205,017,000

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Securities - Schedule of Securities by Contractual Maturity (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Amortized Cost
Due in one year or less	$ 2,964
Due after one year through five years	15,119
Due after five years through ten years	53,731
Due after ten years	823,449
Amortized Cost	1,915,401	$ 2,094,826
Fair Value
Due in one year or less	2,963
Due after one year through five years	15,106
Due after five years through ten years	51,246
Due after ten years	678,991
Fair Value	1,600,709	1,761,669
MBS/CMO
Amortized Cost
Securities without single maturity	793,915
Amortized Cost	793,915	846,519
Fair Value
Securities without single maturity	665,869
Fair Value	665,869	714,681
US Gov’t Sponsored Entities & Agencies
Amortized Cost
Securities without single maturity	226,223
Amortized Cost	226,223	245,017
Fair Value
Securities without single maturity	186,534
Fair Value	$ 186,534	$ 205,017

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Securities - Schedule of Proceeds from Sales of Securities (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Investments, Debt and Equity Securities [Abstract]
Proceeds from Sales	$ 20,507	$ 5,554	$ 114,259	$ 97,500
Gross Gains on Sales	38	78	40	450
Income Taxes on Gross Gains	$ 8	$ 16	$ 8	$ 94

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Securities - Narrative (Details)	Jun. 30, 2023 USD ($) investment	Dec. 31, 2022 USD ($) investment	Dec. 31, 2009 USD ($)
Debt Securities, Available-for-sale [Line Items]
Carrying value of securities pledged to secure repurchase agreements, public and trust deposits and other by law	$ 374,291,000	$ 354,123,000
Allowance for credit losses for available-for-sale debt securities	0	0
Accrued interest receivable on available-for-sale debt securities	9,802,000	10,637,000
Original amount in non-controlling investment security in a single banking organization	353,000	$ 353,000	$ 1,350,000
Additional impairment on equity securities recognized through earnings	$ 0		$ 997,000
Equity Securities
Debt Securities, Available-for-sale [Line Items]
Number of non-controlling investments in a single banking organization | investment	1	1

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Securities - Schedule of Securities with Unrealized Losses (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Debt Securities, Available-for-sale [Line Items]
Less than 12 Months, Fair Value	$ 82,479	$ 1,018,313
Less than 12 Months, Unrealized Loss	(2,003)	(177,161)
12 Months or More, Fair Value	1,475,399	603,633
12 Months or More, Unrealized Loss	(313,177)	(156,691)
Total Fair Value	1,557,878	1,621,946
Total Unrealized Loss	(315,180)	(333,852)
U.S. Treasury
Debt Securities, Available-for-sale [Line Items]
Less than 12 Months, Fair Value	0	0
Less than 12 Months, Unrealized Loss	0	0
12 Months or More, Fair Value	0	0
12 Months or More, Unrealized Loss	0	0
Total Fair Value	0	0
Total Unrealized Loss	0	0
Obligations of State and Political Subdivisions
Debt Securities, Available-for-sale [Line Items]
Less than 12 Months, Fair Value	59,277	579,267
Less than 12 Months, Unrealized Loss	(688)	(117,423)
12 Months or More, Fair Value	646,205	122,992
12 Months or More, Unrealized Loss	(146,757)	(44,591)
Total Fair Value	705,482	702,259
Total Unrealized Loss	(147,445)	(162,014)
MBS/CMO
Debt Securities, Available-for-sale [Line Items]
Less than 12 Months, Fair Value	23,202	240,344
Less than 12 Months, Unrealized Loss	(1,315)	(20,920)
12 Months or More, Fair Value	642,660	474,327
12 Months or More, Unrealized Loss	(126,731)	(110,918)
Total Fair Value	665,862	714,671
Total Unrealized Loss	(128,046)	(131,838)
US Gov’t Sponsored Entities & Agencies
Debt Securities, Available-for-sale [Line Items]
Less than 12 Months, Fair Value	0	198,702
Less than 12 Months, Unrealized Loss	0	(38,818)
12 Months or More, Fair Value	186,534	6,314
12 Months or More, Unrealized Loss	(39,689)	(1,182)
Total Fair Value	186,534	205,016
Total Unrealized Loss	$ (39,689)	$ (40,000)

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Derivatives - Narrative (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Interest Rate Swaps
Derivatives, Fair Value [Line Items]
Notional amount of derivatives	$ 135,113	$ 134,684

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Derivatives - Fair Value Hedges Included in Consolidated Balance Sheets (Details) - Interest Rate Swaps - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Other Assets
Included in Other Assets:
Interest Rate Swaps, Notional Amount	$ 135,113	$ 134,684
Interest Rate Swaps, Fair Value	9,183	9,899
Other Liabilities
Included in Other Liabilities:
Interest Rate Swaps, Notional Amount	135,113	134,684
Interest Rate Swaps, Fair Value	$ 9,112	$ 9,749

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Derivatives - Effects of Derivatives on Consolidated Statements of Income (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Interest Rate Swaps | Other Operating Income
Derivative [Line Items]
Included in Other Operating Income	$ 227	$ 130	$ 178	$ 344

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Loans - Components of Loans (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Mar. 31, 2023	Dec. 31, 2022	Jun. 30, 2022	Mar. 31, 2022	Dec. 31, 2021
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Loans	$ 3,830,481		$ 3,788,645
Less: Unearned Income	(4,472)		(3,711)
Allowance for Credit Losses	(44,266)	$ (44,315)	(44,168)	$ (45,031)	$ (45,078)	$ (37,017)
Loans, Net	3,781,743		3,740,766
Commercial and Industrial Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Loans	608,284		620,106
Allowance for Credit Losses	(13,567)	(13,572)	(13,749)	(13,545)	(12,720)	(9,554)
Commercial Real Estate Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Loans	2,021,109		1,966,884
Allowance for Credit Losses	(21,834)	(22,062)	(21,598)	(22,349)	(23,217)	(19,245)
Agricultural Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Loans	395,466		417,413
Allowance for Credit Losses	(3,956)	(3,887)	(4,188)	(4,628)	(4,759)	(4,505)
Leases
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Loans	60,853		56,396
Allowance for Credit Losses	(235)	(227)	(209)	(191)	(196)	(200)
Home Equity Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Loans	284,517		279,748
Allowance for Credit Losses	(1,436)	(1,415)	(1,344)	(1,233)	(1,207)	(1,061)
Consumer Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Loans	85,595		79,904
Allowance for Credit Losses	(640)	(609)	(595)	(668)	(616)	(507)
Credit Cards
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Loans	19,328		17,512
Allowance for Credit Losses	(288)	(263)	(257)	(239)	(212)	(240)
Residential Mortgage Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Loans	355,329		350,682
Allowance for Credit Losses	(2,310)	$ (2,280)	(2,228)	$ (2,178)	$ (2,151)	$ (1,705)
Commercial: | Commercial and Industrial Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Loans	608,284		620,106
Commercial: | Commercial Real Estate Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Loans	2,021,109		1,966,884
Commercial: | Agricultural Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Loans	395,466		417,413
Commercial: | Leases
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Loans	60,853		56,396
Retail: | Home Equity Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Loans	284,517		279,748
Retail: | Consumer Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Loans	85,595		79,904
Retail: | Credit Cards
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Loans	19,328		17,512
Retail: | Residential Mortgage Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Loans	$ 355,329		$ 350,682

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Loans - Narrative (Details)	3 Months Ended	6 Months Ended	12 Months Ended
	Jun. 30, 2023 USD ($) loan	Jun. 30, 2023 USD ($) loan	Dec. 31, 2022 USD ($) loan
Accounts, Notes, Loans and Financing Receivable [Line Items]
Purchase credit deteriorated loans	$ 3,781,743,000	$ 3,781,743,000	$ 3,740,766,000
Interest income on non-accrual loans	$ 21,000	$ 37,000	32,000
Troubled debt restructurings			0
Allowance for troubled debt restructurings			0
Additional lending amount to customers whose loan terms has been modified in troubled debt restructuring			$ 0
Number of loans modified as troubled debt restructurings | loan	0	0	0
Number of loans modified as troubled debt restructuring subsequently defaulted | loan			0
Threshold amount to individually classify loans by credit risk	$ 250,000	$ 250,000
PCD Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Financing Receivable, Accrued Interest, after Allowance for Credit Loss	$ 15,779,000	$ 15,779,000	$ 21,149,000

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Loans - Allowance for Credit Losses (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Allowance for Credit Losses [Roll Forward]
Beginning balance	$ 44,315	$ 45,078	$ 44,168	$ 37,017
Acquisition of Citizens Union Bank of Shelbyville, KY				3,117
Provision (Benefit) for Credit Losses	550	300	1,650	5,500
Loans charged-off	(849)	(447)	(2,087)	(816)
Recoveries collected	250	100	535	213
Total ending allowance balance	44,266	45,031	44,266	45,031
Commercial and Industrial Loans
Allowance for Credit Losses [Roll Forward]
Beginning balance	13,572	12,720	13,749	9,554
Acquisition of Citizens Union Bank of Shelbyville, KY				376
Provision (Benefit) for Credit Losses	244	874	746	3,662
Loans charged-off	(343)	(56)	(1,077)	(61)
Recoveries collected	94	7	149	14
Total ending allowance balance	13,567	13,545	13,567	13,545
Commercial Real Estate Loans
Allowance for Credit Losses [Roll Forward]
Beginning balance	22,062	23,217	21,598	19,245
Acquisition of Citizens Union Bank of Shelbyville, KY				1,945
Provision (Benefit) for Credit Losses	(233)	(873)	169	1,223
Loans charged-off	0	0	0	(78)
Recoveries collected	5	5	67	14
Total ending allowance balance	21,834	22,349	21,834	22,349
Agricultural Loans
Allowance for Credit Losses [Roll Forward]
Beginning balance	3,887	4,759	4,188	4,505
Acquisition of Citizens Union Bank of Shelbyville, KY				689
Provision (Benefit) for Credit Losses	94	(131)	(207)	(566)
Loans charged-off	(25)	0	(25)	0
Recoveries collected	0	0	0	0
Total ending allowance balance	3,956	4,628	3,956	4,628
Leases
Allowance for Credit Losses [Roll Forward]
Beginning balance	227	196	209	200
Acquisition of Citizens Union Bank of Shelbyville, KY				0
Provision (Benefit) for Credit Losses	8	(5)	26	(9)
Loans charged-off	0	0	0	0
Recoveries collected	0	0	0	0
Total ending allowance balance	235	191	235	191
Consumer Loans
Allowance for Credit Losses [Roll Forward]
Beginning balance	609	616	595	507
Acquisition of Citizens Union Bank of Shelbyville, KY				2
Provision (Benefit) for Credit Losses	174	293	399	518
Loans charged-off	(284)	(322)	(628)	(532)
Recoveries collected	141	81	274	173
Total ending allowance balance	640	668	640	668
Home Equity Loans
Allowance for Credit Losses [Roll Forward]
Beginning balance	1,415	1,207	1,344	1,061
Acquisition of Citizens Union Bank of Shelbyville, KY				0
Provision (Benefit) for Credit Losses	45	41	100	224
Loans charged-off	(25)	(15)	(39)	(52)
Recoveries collected	1	0	31	0
Total ending allowance balance	1,436	1,233	1,436	1,233
Credit Cards
Allowance for Credit Losses [Roll Forward]
Beginning balance	263	212	257	240
Acquisition of Citizens Union Bank of Shelbyville, KY				0
Provision (Benefit) for Credit Losses	157	73	281	79
Loans charged-off	(141)	(51)	(261)	(90)
Recoveries collected	9	5	11	10
Total ending allowance balance	288	239	288	239
Residential Mortgage Loans
Allowance for Credit Losses [Roll Forward]
Beginning balance	2,280	2,151	2,228	1,705
Acquisition of Citizens Union Bank of Shelbyville, KY				105
Provision (Benefit) for Credit Losses	61	28	136	369
Loans charged-off	(31)	(3)	(57)	(3)
Recoveries collected	0	2	3	2
Total ending allowance balance	2,310	2,178	2,310	2,178
Unallocated
Allowance for Credit Losses [Roll Forward]
Beginning balance	0	0	0	0
Acquisition of Citizens Union Bank of Shelbyville, KY				0
Provision (Benefit) for Credit Losses	0	0	0	0
Loans charged-off	0	0	0	0
Recoveries collected	0	0	0	0
Total ending allowance balance	$ 0	$ 0	$ 0	$ 0

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Loans - Non-Accrual and Past Due Loans (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Financing Receivable, Past Due [Line Items]
Non-Accrual With No Allowance For Credit Loss	$ 2,968	$ 3,509
Total Non-Accrual	11,423	12,888
Loans Past Due Over 89 Days Still Accruing	1,000	1,427
Commercial and Industrial Loans
Financing Receivable, Past Due [Line Items]
Non-Accrual With No Allowance For Credit Loss	620	1,142
Total Non-Accrual	7,577	7,936
Loans Past Due Over 89 Days Still Accruing	1,000	1,427
Commercial Real Estate Loans
Financing Receivable, Past Due [Line Items]
Non-Accrual With No Allowance For Credit Loss	425	49
Total Non-Accrual	1,178	1,950
Loans Past Due Over 89 Days Still Accruing	0	0
Agricultural Loans
Financing Receivable, Past Due [Line Items]
Non-Accrual With No Allowance For Credit Loss	906	994
Total Non-Accrual	1,252	1,062
Loans Past Due Over 89 Days Still Accruing	0	0
Leases
Financing Receivable, Past Due [Line Items]
Non-Accrual With No Allowance For Credit Loss	0	0
Total Non-Accrual	0	0
Loans Past Due Over 89 Days Still Accruing	0	0
Home Equity Loans
Financing Receivable, Past Due [Line Items]
Non-Accrual With No Allowance For Credit Loss	449	262
Total Non-Accrual	503	310
Loans Past Due Over 89 Days Still Accruing	0	0
Consumer Loans
Financing Receivable, Past Due [Line Items]
Non-Accrual With No Allowance For Credit Loss	18	240
Total Non-Accrual	18	254
Loans Past Due Over 89 Days Still Accruing	0	0
Credit Cards
Financing Receivable, Past Due [Line Items]
Non-Accrual With No Allowance For Credit Loss	119	146
Total Non-Accrual	119	146
Loans Past Due Over 89 Days Still Accruing	0	0
Residential Mortgage Loans
Financing Receivable, Past Due [Line Items]
Non-Accrual With No Allowance For Credit Loss	431	676
Total Non-Accrual	776	1,230
Loans Past Due Over 89 Days Still Accruing	$ 0	$ 0

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Loans - Collateral-dependent Loans by Class (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	$ 3,830,481	$ 3,788,645
Total
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	23,947	28,459
Real Estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	16,558	20,749
Equipment
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	540	1,575
Accounts Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total		272
Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	6,849	5,863
Commercial and Industrial Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	608,284	620,106
Commercial and Industrial Loans | Total
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	9,070	9,420
Commercial and Industrial Loans | Real Estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	2,005	2,078
Commercial and Industrial Loans | Equipment
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	216	1,219
Commercial and Industrial Loans | Accounts Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total		272
Commercial and Industrial Loans | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	6,849	5,851
Commercial Real Estate Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	2,021,109	1,966,884
Commercial Real Estate Loans | Total
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	9,085	12,228
Commercial Real Estate Loans | Real Estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	9,050	12,192
Commercial Real Estate Loans | Equipment
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	35	36
Commercial Real Estate Loans | Accounts Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Commercial Real Estate Loans | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Agricultural Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	395,466	417,413
Agricultural Loans | Total
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	4,448	5,262
Agricultural Loans | Real Estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	4,160	4,944
Agricultural Loans | Equipment
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	288	318
Agricultural Loans | Accounts Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Agricultural Loans | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Leases
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	60,853	56,396
Leases | Total
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Leases | Real Estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Leases | Equipment
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Leases | Accounts Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Leases | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Home Equity Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	284,517	279,748
Home Equity Loans | Total
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	475	467
Home Equity Loans | Real Estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	475	467
Home Equity Loans | Equipment
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Home Equity Loans | Accounts Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Home Equity Loans | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Consumer Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	85,595	79,904
Consumer Loans | Total
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	9	22
Consumer Loans | Real Estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	8	8
Consumer Loans | Equipment
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	1	2
Consumer Loans | Accounts Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Consumer Loans | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	12
Credit Cards
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	19,328	17,512
Credit Cards | Total
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Credit Cards | Real Estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Credit Cards | Equipment
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Credit Cards | Accounts Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Credit Cards | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Residential Mortgage Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	355,329	350,682
Residential Mortgage Loans | Total
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	860	1,060
Residential Mortgage Loans | Real Estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	860	1,060
Residential Mortgage Loans | Equipment
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Residential Mortgage Loans | Accounts Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	0	0
Residential Mortgage Loans | Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	$ 0	$ 0

XML

Loans - Aging of Past Due Loans (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Financing Receivable, Past Due [Line Items]
Total	$ 3,830,481	$ 3,788,645
Total Past Due
Financing Receivable, Past Due [Line Items]
Total	22,352	25,122
30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	8,900	10,633
60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	2,357	3,706
Greater Than 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	11,095	10,783
Loans Not Past Due
Financing Receivable, Past Due [Line Items]
Total	3,808,129	3,763,523
Commercial and Industrial Loans
Financing Receivable, Past Due [Line Items]
Total	608,284	620,106
Commercial and Industrial Loans | Total Past Due
Financing Receivable, Past Due [Line Items]
Total	8,255	9,234
Commercial and Industrial Loans | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	96	268
Commercial and Industrial Loans | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	49	681
Commercial and Industrial Loans | Greater Than 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	8,110	8,285
Commercial and Industrial Loans | Loans Not Past Due
Financing Receivable, Past Due [Line Items]
Total	600,029	610,872
Commercial Real Estate Loans
Financing Receivable, Past Due [Line Items]
Total	2,021,109	1,966,884
Commercial Real Estate Loans | Total Past Due
Financing Receivable, Past Due [Line Items]
Total	2,318	2,247
Commercial Real Estate Loans | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	710	1,617
Commercial Real Estate Loans | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	599	14
Commercial Real Estate Loans | Greater Than 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	1,009	616
Commercial Real Estate Loans | Loans Not Past Due
Financing Receivable, Past Due [Line Items]
Total	2,018,791	1,964,637
Agricultural Loans
Financing Receivable, Past Due [Line Items]
Total	395,466	417,413
Agricultural Loans | Total Past Due
Financing Receivable, Past Due [Line Items]
Total	2,002	466
Agricultural Loans | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	632	343
Agricultural Loans | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	590	0
Agricultural Loans | Greater Than 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	780	123
Agricultural Loans | Loans Not Past Due
Financing Receivable, Past Due [Line Items]
Total	393,464	416,947
Leases
Financing Receivable, Past Due [Line Items]
Total	60,853	56,396
Leases | Total Past Due
Financing Receivable, Past Due [Line Items]
Total	0	0
Leases | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	0	0
Leases | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	0	0
Leases | Greater Than 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	0	0
Leases | Loans Not Past Due
Financing Receivable, Past Due [Line Items]
Total	60,853	56,396
Home Equity Loans
Financing Receivable, Past Due [Line Items]
Total	284,517	279,748
Home Equity Loans | Total Past Due
Financing Receivable, Past Due [Line Items]
Total	1,755	2,220
Home Equity Loans | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	1,163	1,770
Home Equity Loans | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	89	140
Home Equity Loans | Greater Than 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	503	310
Home Equity Loans | Loans Not Past Due
Financing Receivable, Past Due [Line Items]
Total	282,762	277,528
Consumer Loans
Financing Receivable, Past Due [Line Items]
Total	85,595	79,904
Consumer Loans | Total Past Due
Financing Receivable, Past Due [Line Items]
Total	192	535
Consumer Loans | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	133	219
Consumer Loans | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	42	64
Consumer Loans | Greater Than 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	17	252
Consumer Loans | Loans Not Past Due
Financing Receivable, Past Due [Line Items]
Total	85,403	79,369
Credit Cards
Financing Receivable, Past Due [Line Items]
Total	19,328	17,512
Credit Cards | Total Past Due
Financing Receivable, Past Due [Line Items]
Total	235	256
Credit Cards | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	94	86
Credit Cards | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	22	24
Credit Cards | Greater Than 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	119	146
Credit Cards | Loans Not Past Due
Financing Receivable, Past Due [Line Items]
Total	19,093	17,256
Residential Mortgage Loans
Financing Receivable, Past Due [Line Items]
Total	355,329	350,682
Residential Mortgage Loans | Total Past Due
Financing Receivable, Past Due [Line Items]
Total	7,595	10,164
Residential Mortgage Loans | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	6,072	6,330
Residential Mortgage Loans | 60-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	966	2,783
Residential Mortgage Loans | Greater Than 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	557	1,051
Residential Mortgage Loans | Loans Not Past Due
Financing Receivable, Past Due [Line Items]
Total	$ 347,734	$ 340,518

XML

Loans - Risk Category of Loans by Class (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Financing Receivable, Credit Quality Indicator [Line Items]
Total	$ 3,830,481		$ 3,830,481		$ 3,788,645
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss, Writeoff, by Origination Year [Abstract]
Total	849	$ 447	2,087	$ 816
Commercial and Industrial Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	54,353		54,353		158,088
2022-2021	147,408		147,408		123,425
2021-2020	103,240		103,240		41,375
2020-2019	34,807		34,807		47,887
2019-2018	41,322		41,322		20,002
Prior	64,378		64,378		56,065
Revolving Loans Amortized Cost Basis	162,776		162,776		173,264
Total	608,284		608,284		620,106
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss, Writeoff, by Origination Year [Abstract]
2023			0
2022			861
2021			32
2020			33
2019			0
Prior			50
Revolving Loans Amortized Cost Basis			101
Total	343	56	1,077	61
Commercial Real Estate Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	164,660		164,660		402,613
2022-2021	412,782		412,782		496,943
2021-2020	495,061		495,061		266,563
2020-2019	237,684		237,684		164,251
2019-2018	154,467		154,467		143,819
Prior	523,353		523,353		457,532
Revolving Loans Amortized Cost Basis	33,102		33,102		35,163
Total	2,021,109		2,021,109		1,966,884
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss, Writeoff, by Origination Year [Abstract]
2023			0
2022			0
2021			0
2020			0
2019			0
Prior			0
Revolving Loans Amortized Cost Basis			0
Total	0	0	0	78
Agricultural Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	25,908		25,908		63,307
2022-2021	59,611		59,611		48,734
2021-2020	45,075		45,075		54,049
2020-2019	51,186		51,186		30,009
2019-2018	26,119		26,119		24,168
Prior	122,292		122,292		108,974
Revolving Loans Amortized Cost Basis	65,275		65,275		88,172
Total	395,466		395,466		417,413
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss, Writeoff, by Origination Year [Abstract]
2023			0
2022			0
2021			0
2020			0
2019			0
Prior			25
Revolving Loans Amortized Cost Basis			0
Total	25	0	25	0
Leases
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	15,188		15,188		20,057
2022-2021	15,821		15,821		14,461
2021-2020	12,454		12,454		9,648
2020-2019	7,925		7,925		8,901
2019-2018	7,142		7,142		1,851
Prior	2,323		2,323		1,478
Revolving Loans Amortized Cost Basis	0		0		0
Total	60,853		60,853		56,396
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss, Writeoff, by Origination Year [Abstract]
2023			0
2022			0
2021			0
2020			0
2019			0
Prior			0
Revolving Loans Amortized Cost Basis			0
Total	0	$ 0	0	$ 0
Pass | Commercial and Industrial Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	54,328		54,328		156,318
2022-2021	146,823		146,823		117,648
2021-2020	97,546		97,546		39,949
2020-2019	33,668		33,668		46,505
2019-2018	39,516		39,516		18,423
Prior	60,729		60,729		51,482
Revolving Loans Amortized Cost Basis	144,955		144,955		154,203
Total	577,565		577,565		584,528
Pass | Commercial Real Estate Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	151,013		151,013		398,631
2022-2021	411,741		411,741		490,747
2021-2020	488,764		488,764		261,462
2020-2019	232,238		232,238		162,701
2019-2018	153,101		153,101		129,151
Prior	499,661		499,661		427,433
Revolving Loans Amortized Cost Basis	32,722		32,722		35,163
Total	1,969,240		1,969,240		1,905,288
Pass | Agricultural Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	24,291		24,291		62,673
2022-2021	59,278		59,278		47,682
2021-2020	43,841		43,841		47,355
2020-2019	44,708		44,708		25,431
2019-2018	23,191		23,191		21,728
Prior	107,131		107,131		92,344
Revolving Loans Amortized Cost Basis	61,116		61,116		83,862
Total	363,556		363,556		381,075
Pass | Leases
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	15,188		15,188		20,057
2022-2021	15,821		15,821		14,461
2021-2020	12,454		12,454		9,648
2020-2019	7,925		7,925		8,901
2019-2018	7,142		7,142		1,851
Prior	2,323		2,323		1,478
Revolving Loans Amortized Cost Basis	0		0		0
Total	60,853		60,853		56,396
Special Mention | Commercial and Industrial Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	0		0		56
2022-2021	55		55		148
2021-2020	446		446		577
2020-2019	589		589		78
2019-2018	650		650		551
Prior	1,504		1,504		2,346
Revolving Loans Amortized Cost Basis	5,182		5,182		1,672
Total	8,426		8,426		5,428
Special Mention | Commercial Real Estate Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	13,647		13,647		3,982
2022-2021	836		836		1,568
2021-2020	948		948		4,612
2020-2019	4,774		4,774		135
2019-2018	243		243		13,689
Prior	20,191		20,191		25,371
Revolving Loans Amortized Cost Basis	0		0		0
Total	40,639		40,639		49,357
Special Mention | Agricultural Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	1,617		1,617		634
2022-2021	333		333		842
2021-2020	1,028		1,028		6,066
2020-2019	5,856		5,856		4,149
2019-2018	2,593		2,593		2,355
Prior	10,950		10,950		11,440
Revolving Loans Amortized Cost Basis	4,159		4,159		4,310
Total	26,536		26,536		29,796
Special Mention | Leases
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	0		0		0
2022-2021	0		0		0
2021-2020	0		0		0
2020-2019	0		0		0
2019-2018	0		0		0
Prior	0		0		0
Revolving Loans Amortized Cost Basis	0		0		0
Total	0		0		0
Substandard | Commercial and Industrial Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	25		25		1,714
2022-2021	530		530		5,629
2021-2020	5,248		5,248		849
2020-2019	550		550		1,304
2019-2018	1,156		1,156		1,028
Prior	2,145		2,145		2,237
Revolving Loans Amortized Cost Basis	12,639		12,639		17,389
Total	22,293		22,293		30,150
Substandard | Commercial Real Estate Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	0		0		0
2022-2021	205		205		4,628
2021-2020	5,349		5,349		489
2020-2019	672		672		1,415
2019-2018	1,123		1,123		979
Prior	3,501		3,501		4,728
Revolving Loans Amortized Cost Basis	380		380		0
Total	11,230		11,230		12,239
Substandard | Agricultural Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	0		0		0
2022-2021	0		0		210
2021-2020	206		206		628
2020-2019	622		622		429
2019-2018	335		335		85
Prior	4,211		4,211		5,190
Revolving Loans Amortized Cost Basis	0		0		0
Total	5,374		5,374		6,542
Substandard | Leases
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	0		0		0
2022-2021	0		0		0
2021-2020	0		0		0
2020-2019	0		0		0
2019-2018	0		0		0
Prior	0		0		0
Revolving Loans Amortized Cost Basis	0		0		0
Total	0		0		0
Doubtful | Commercial and Industrial Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	0		0		0
2022-2021	0		0		0
2021-2020	0		0		0
2020-2019	0		0		0
2019-2018	0		0		0
Prior	0		0		0
Revolving Loans Amortized Cost Basis	0		0		0
Total	0		0		0
Doubtful | Commercial Real Estate Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	0		0		0
2022-2021	0		0		0
2021-2020	0		0		0
2020-2019	0		0		0
2019-2018	0		0		0
Prior	0		0		0
Revolving Loans Amortized Cost Basis	0		0		0
Total	0		0		0
Doubtful | Agricultural Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	0		0		0
2022-2021	0		0		0
2021-2020	0		0		0
2020-2019	0		0		0
2019-2018	0		0		0
Prior	0		0		0
Revolving Loans Amortized Cost Basis	0		0		0
Total	0		0		0
Doubtful | Leases
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	0		0		0
2022-2021	0		0		0
2021-2020	0		0		0
2020-2019	0		0		0
2019-2018	0		0		0
Prior	0		0		0
Revolving Loans Amortized Cost Basis	0		0		0
Total	$ 0		$ 0		$ 0

XML

Loans - Residential, Home Equity and Consumer Loans Based on Payment Activity (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Financing Receivable, Credit Quality Indicator [Line Items]
Total	$ 3,830,481		$ 3,830,481		$ 3,788,645
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss, Writeoff, by Origination Year [Abstract]
Total	849	$ 447	2,087	$ 816
Consumer Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	29,474		29,474		42,688
2022-2021	32,605		32,605		22,727
2021-2020	13,574		13,574		5,822
2020-2019	4,116		4,116		2,402
2019-2018	1,412		1,412		1,545
Prior	2,457		2,457		1,563
Revolving Loans Amortized Cost Basis	1,957		1,957		3,157
Total	85,595		85,595		79,904
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss, Writeoff, by Origination Year [Abstract]
2023			554
2022			24
2021			20
2020			19
2019			3
Prior			1
Revolving Loans Amortized Cost Basis			7
Total	284	322	628	532
Consumer Loans | Performing
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	29,474		29,474		42,685
2022-2021	32,598		32,598		22,708
2021-2020	13,564		13,564		5,610
2020-2019	4,116		4,116		2,394
2019-2018	1,412		1,412		1,543
Prior	2,456		2,456		1,553
Revolving Loans Amortized Cost Basis	1,957		1,957		3,157
Total	85,577		85,577		79,650
Consumer Loans | Nonperforming
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	0		0		3
2022-2021	7		7		19
2021-2020	10		10		212
2020-2019	0		0		8
2019-2018	0		0		2
Prior	1		1		10
Revolving Loans Amortized Cost Basis	0		0		0
Total	18		18		254
Home Equity Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	0		0		63
2022-2021	115		115		20
2021-2020	338		338		0
2020-2019	90		90		0
2019-2018	68		68		19
Prior	1,059		1,059		592
Revolving Loans Amortized Cost Basis	282,847		282,847		279,054
Total	284,517		284,517		279,748
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss, Writeoff, by Origination Year [Abstract]
2023			0
2022			0
2021			0
2020			0
2019			0
Prior			24
Revolving Loans Amortized Cost Basis			15
Total	25	15	39	52
Home Equity Loans | Performing
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	0		0		63
2022-2021	75		75		0
2021-2020	86		86		0
2020-2019	90		90		0
2019-2018	24		24		0
Prior	960		960		591
Revolving Loans Amortized Cost Basis	282,779		282,779		278,784
Total	284,014		284,014		279,438
Home Equity Loans | Nonperforming
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	0		0		0
2022-2021	40		40		20
2021-2020	252		252		0
2020-2019	0		0		0
2019-2018	44		44		19
Prior	99		99		1
Revolving Loans Amortized Cost Basis	68		68		270
Total	503		503		310
Residential Mortgage Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	28,513		28,513		69,982
2022-2021	68,601		68,601		97,337
2021-2020	90,641		90,641		47,104
2020-2019	43,715		43,715		20,080
2019-2018	18,995		18,995		16,742
Prior	104,864		104,864		99,437
Revolving Loans Amortized Cost Basis	0		0		0
Total	355,329		355,329		350,682
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss, Writeoff, by Origination Year [Abstract]
2023			0
2022			0
2021			21
2020			36
2019			0
Prior			0
Revolving Loans Amortized Cost Basis			0
Total	31	3	57	3
Residential Mortgage Loans | Performing
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	28,513		28,513		69,982
2022-2021	68,601		68,601		97,176
2021-2020	90,501		90,501		46,851
2020-2019	43,591		43,591		20,080
2019-2018	18,887		18,887		16,664
Prior	104,460		104,460		98,699
Revolving Loans Amortized Cost Basis	0		0		0
Total	354,553		354,553		349,452
Residential Mortgage Loans | Nonperforming
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	0		0		0
2022-2021	0		0		161
2021-2020	140		140		253
2020-2019	124		124		0
2019-2018	108		108		78
Prior	404		404		738
Revolving Loans Amortized Cost Basis	0		0		0
Total	776		776		1,230
Commercial and Industrial Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2023-2022	54,353		54,353		158,088
2022-2021	147,408		147,408		123,425
2021-2020	103,240		103,240		41,375
2020-2019	34,807		34,807		47,887
2019-2018	41,322		41,322		20,002
Prior	64,378		64,378		56,065
Revolving Loans Amortized Cost Basis	162,776		162,776		173,264
Total	608,284		608,284		$ 620,106
Financing Receivable, Excluding Accrued Interest, Allowance for Credit Loss, Writeoff, by Origination Year [Abstract]
2023			0
2022			861
2021			32
2020			33
2019			0
Prior			50
Revolving Loans Amortized Cost Basis			101
Total	$ 343	$ 56	$ 1,077	$ 61

XML

Loans - Recorded Investment in Credit Cards Based on Payment Activity (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Financing Receivable, Credit Quality Indicator [Line Items]
Total	$ 3,830,481	$ 3,788,645
Credit Cards
Financing Receivable, Credit Quality Indicator [Line Items]
Total	19,328	17,512
Credit Cards | Performing
Financing Receivable, Credit Quality Indicator [Line Items]
Total	19,209	17,366
Credit Cards | Nonperforming
Financing Receivable, Credit Quality Indicator [Line Items]
Total	$ 119	$ 146

XML

Loans - Loans Purchased and/or Sold During the Year by Portfolio Segment (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Accounts, Notes, Loans and Financing Receivable [Line Items]
Purchases	$ 173	$ 933
Sales	0	3,916
Commercial and Industrial Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Purchases	0	522
Sales	0	0
Commercial Real Estate Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Purchases	173	411
Sales	0	3,819
Agricultural Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Purchases	0	0
Sales	0	97
Leases
Accounts, Notes, Loans and Financing Receivable [Line Items]
Purchases	0	0
Sales	0	0
Consumer Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Purchases	0	0
Sales	0	0
Home Equity Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Purchases	0	0
Sales	0	0
Credit Cards
Accounts, Notes, Loans and Financing Receivable [Line Items]
Purchases	0	0
Sales	0	0
Residential Mortgage Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Purchases	0	0
Sales	$ 0	$ 0

XML

Repurchase Agreements Accounted for as Secured Borrowings (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Collateralized Mortgage Backed Securities | Maturity Overnight | FHLB Advances and Other Borrowings
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items]
Repurchased agreements	$ 51,874	$ 64,961

XML

Segment Information - Narrative (Details)	6 Months Ended
	Jun. 30, 2023 segment banking_office
Segment Reporting [Abstract]
Number of operating segments | segment	3
Number of banking offices | banking_office	76

XML

Segment Information - Segment Financial Information (Details) - USD ($) $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2022	Mar. 31, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Segment Reporting Information [Line Items]
Net Interest Income	$ 48,258		$ 49,597		$ 97,267	$ 96,505
Net Gains on Sales of Loans	630		1,049		1,217	2,470
Net Gains on Securities	38		78		40	450
Wealth Management Fees	2,912		2,642		5,556	5,280
Insurance Revenues	2,130		2,254		5,265	5,975
Noncash Items:
Provision (Benefit) for Credit Losses	550		300		1,650	5,500
Depreciation and Amortization	2,411		2,596		4,840	5,250
Income Tax Expense (Benefit)	4,755		5,029		9,208	5,698
Segment Profit (Loss)	22,123	$ 20,807	23,747	$ 9,067	42,930	32,814
Segment Assets	6,053,269				6,053,269		$ 6,155,991
Operating Segments | Core Banking
Segment Reporting Information [Line Items]
Net Interest Income	49,429		50,474		99,570	98,139
Net Gains on Sales of Loans	630		1,049		1,217	2,470
Net Gains on Securities	38		78		40	450
Wealth Management Fees	1		1		3	2
Insurance Revenues	1		2		1	29
Noncash Items:
Provision (Benefit) for Credit Losses	550		300		1,650	5,500
Depreciation and Amortization	2,275		2,459		4,568	4,977
Income Tax Expense (Benefit)	4,988		5,129		9,390	5,745
Segment Profit (Loss)	21,951		23,519		42,515	31,948
Segment Assets	6,045,924				6,045,924		6,152,346
Operating Segments | Wealth Management Services
Segment Reporting Information [Line Items]
Net Interest Income	30		9		54	14
Net Gains on Sales of Loans	0		0		0	0
Net Gains on Securities	0		0		0	0
Wealth Management Fees	2,911		2,641		5,553	5,278
Insurance Revenues	3		1		20	2
Noncash Items:
Provision (Benefit) for Credit Losses	0		0		0	0
Depreciation and Amortization	10		11		19	21
Income Tax Expense (Benefit)	161		198		290	402
Segment Profit (Loss)	715		617		1,322	1,257
Segment Assets	10,225				10,225		8,846
Operating Segments | Insurance
Segment Reporting Information [Line Items]
Net Interest Income	15		3		29	6
Net Gains on Sales of Loans	0		0		0	0
Net Gains on Securities	0		0		0	0
Wealth Management Fees	0		0		0	0
Insurance Revenues	2,126		2,251		5,244	5,944
Noncash Items:
Provision (Benefit) for Credit Losses	0		0		0	0
Depreciation and Amortization	12		12		25	24
Income Tax Expense (Benefit)	93		133		320	583
Segment Profit (Loss)	247		420		1,308	1,849
Segment Assets	15,693				15,693		14,706
Other
Segment Reporting Information [Line Items]
Net Interest Income	(1,216)		(889)		(2,386)	(1,654)
Net Gains on Sales of Loans	0		0		0	0
Net Gains on Securities	0		0		0	0
Wealth Management Fees	0		0		0	0
Insurance Revenues	0		0		0	0
Noncash Items:
Provision (Benefit) for Credit Losses	0		0		0	0
Depreciation and Amortization	114		114		228	228
Income Tax Expense (Benefit)	(487)		(431)		(792)	(1,032)
Segment Profit (Loss)	(790)		$ (809)		(2,215)	$ (2,240)
Segment Assets	$ (18,573)				$ (18,573)		$ (19,907)

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Stock Repurchase Plan (Details) - shares		17 Months Ended
	Jan. 31, 2022	Jun. 30, 2023
2022 Repurchase Plan
Equity, Class of Treasury Stock [Line Items]
Common stock, shares purchased (in shares)		0
Common Stock | 2022 Repurchase Plan
Equity, Class of Treasury Stock [Line Items]
Common stock, authorized shares repurchase (up to) (in shares)	1,000,000
Common stock, percentage of Company's outstanding shares authorized for repurchase	3.00%
Common Stock | 2021 Repurchase Plan
Equity, Class of Treasury Stock [Line Items]
Common stock, authorized shares repurchase (up to) (in shares)	1,000,000
Common stock, shares purchased (in shares)		0

XML

Equity Plans and Equity Based Compensation - Narrative (Details)		3 Months Ended		6 Months Ended		12 Months Ended		21 Months Ended	27 Months Ended
	Oct. 01, 2019 shares	Jun. 30, 2023 USD ($) plan shares	Jun. 30, 2022 USD ($) shares	Jun. 30, 2023 USD ($) plan shares	Jun. 30, 2022 USD ($) shares	Dec. 31, 2020	Dec. 31, 2019 installment	Sep. 30, 2022	Mar. 31, 2023	Dec. 31, 2022 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of equity incentive plans | plan		2		2
Number of options granted (in shares) | shares		0	0	0	0
Stock compensation expense		$ 179,000	$ 169,000	$ 361,000	$ 334,000
Stock compensation expense, net of tax		$ 747,000	935,000	$ 1,281,000	1,371,000
Outstanding stock options (in shares) | shares		0		0						0
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock compensation expense		$ 0	0	$ 0	0
Unrecognized compensation expense		0	0	0	0
Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense		$ 4,490,000	$ 3,503,000	$ 4,490,000	$ 3,503,000
Awards granted during period percentage						66.67%	60.00%
Awards granted cash credit entitlement percentage						33.33%	40.00%
Number of annual vesting installments | installment							3
Restricted stock granted during period (in shares) | shares		728	0	81,118	63,258
Unvested restricted stock awards (in shares) | shares		133,954		133,954						74,873
Restricted Stock | Executive Officers
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Awards granted during period percentage									100.00%
Restricted Stock | Director
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage				100.00%
Restricted Stock | Vesting Period One
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage						100.00%	33.33%
Restricted Stock | Vesting Period One | Executive Officers
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage								33.33%
Restricted Stock | Vesting Period Two
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage						50.00%
Restricted Stock | Vesting Period Two | Executive Officers
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage								33.33%
Restricted Stock | Vesting Period Three | Executive Officers
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage								33.33%
2009 Long-Term Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares reserved for new grants (in shares) | shares		0		0
2009 Long-Term Equity Incentive Plan | Restricted Stock | Vesting Period Two
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage							33.33%
2009 Long-Term Equity Incentive Plan | Restricted Stock | Vesting Period Three
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage						50.00%	33.33%
2019 LTI Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares authorized for issuance (in shares) | shares		1,000,000		1,000,000
2019 ESPP
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares reserved for new grants (in shares) | shares	750,000
Offering periods (in months)	3 months
Purchase price percentage	95.00%
2009 ESPP | Employee Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock compensation expense		$ 4,000	$ 14,000	$ 16,000	$ 28,000
Unrecognized compensation expense		0	0	0	0
Stock compensation expense, net of tax		$ 3,000	$ 10,000	$ 12,000	$ 21,000

XML

Equity Plans and Equity Based Compensation - Expense Recorded for Restricted Stock and Cash Entitlements (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Share-Based Payment Arrangement [Abstract]
Restricted Stock Expense	$ 830	$ 1,093	$ 1,369	$ 1,517
Cash Entitlement Expense	179	169	361	334
Tax Effect	(262)	(327)	(449)	(480)
Net of Tax	$ 747	$ 935	$ 1,281	$ 1,371

XML

Fair Value - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Loans Held-for-sale
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
(Losses)/gains from changes in fair value included in earnings	$ 59	$ (94)	$ 30	$ (135)
Fair Value, Measurements, Recurring
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value of securities held	1,600,709		1,600,709		$ 1,761,669
Fair Value, Measurements, Recurring | Obligations of State and Political Subdivisions
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value of securities held	747,306		747,306		777,852
Fair Value, Measurements, Recurring | MBS/CMO
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value of securities held	665,869		665,869		714,681
Significant Unobservable  Inputs (Level 3) | Fair Value, Measurements, Recurring
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value of securities held	1,003		1,003		989
Significant Unobservable  Inputs (Level 3) | Fair Value, Measurements, Recurring | Obligations of State and Political Subdivisions
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value of securities held	84		84		83
Significant Unobservable  Inputs (Level 3) | Fair Value, Measurements, Recurring | MBS/CMO
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value of securities held	919		919		$ 906
Losses from other changes in fair value included in other comprehensive income	$ 3	$ 0	$ 14	$ 0

XML

Fair Value - Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Loans Held-for-Sale	$ 8,239	$ 8,600
Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	1,600,709	1,761,669
Loans Held-for-Sale	8,239	8,600
Derivative Assets	9,183	9,899
Derivative Liabilities	9,112	9,749
Fair Value, Measurements, Recurring | U.S. Treasury
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	1,000	64,119
Fair Value, Measurements, Recurring | Obligations of State and Political Subdivisions
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	747,306	777,852
Fair Value, Measurements, Recurring | MBS/CMO
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	665,869	714,681
Fair Value, Measurements, Recurring | US Gov’t Sponsored Entities & Agencies
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	186,534	205,017
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	1,000	64,119
Loans Held-for-Sale	0	0
Derivative Assets	0	0
Derivative Liabilities	0	0
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | U.S. Treasury
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	1,000	64,119
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Obligations of State and Political Subdivisions
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	0	0
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | MBS/CMO
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	0	0
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | US Gov’t Sponsored Entities & Agencies
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	0	0
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	1,598,706	1,696,561
Loans Held-for-Sale	8,239	8,600
Derivative Assets	9,183	9,899
Derivative Liabilities	9,112	9,749
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | U.S. Treasury
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	0	0
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Obligations of State and Political Subdivisions
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	747,222	777,769
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | MBS/CMO
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	664,950	713,775
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | US Gov’t Sponsored Entities & Agencies
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	186,534	205,017
Fair Value, Measurements, Recurring | Significant Unobservable  Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	1,003	989
Loans Held-for-Sale	0	0
Derivative Assets	0	0
Derivative Liabilities	0	0
Fair Value, Measurements, Recurring | Significant Unobservable  Inputs (Level 3) | U.S. Treasury
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	0	0
Fair Value, Measurements, Recurring | Significant Unobservable  Inputs (Level 3) | Obligations of State and Political Subdivisions
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	84	83
Fair Value, Measurements, Recurring | Significant Unobservable  Inputs (Level 3) | MBS/CMO
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	919	906
Fair Value, Measurements, Recurring | Significant Unobservable  Inputs (Level 3) | US Gov’t Sponsored Entities & Agencies
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Securities	$ 0	$ 0

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Fair Value - Aggregate Fair Value, Contractual Balance and Gain or Loss of Loans Held-for-Sale (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Fair Value Disclosures [Abstract]
Aggregate Fair Value	$ 8,239	$ 8,600
Contractual Balance	8,083	8,474
Gain (Loss)	$ 156	$ 126

XML

Fair Value - Reconciliation of all Assets Measured at Fair Value on Recurring Basis, Using Significant Unobservable Inputs (Level 3) (Details) - Fair Value, Measurements, Recurring - Significant Unobservable  Inputs (Level 3) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Obligations of State and Political Subdivisions
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning Balance of Recurring Level 3 Assets	$ 83	$ 94	$ 83	$ 0
Total Gains Included in Other Comprehensive Income	1	0	1	0
Maturities / Calls	0	0	0	0
Acquired through Bank Acquisition	0	0	0	94
Ending Balance of Recurring Level 3 Assets	84	94	84	94
MBS/CMO
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning Balance of Recurring Level 3 Assets	917	0	906	0
Total Gains Included in Other Comprehensive Income	2	0	13	0
Maturities / Calls	0	0	0	0
Acquired through Bank Acquisition	0	0	0	0
Ending Balance of Recurring Level 3 Assets	$ 919	$ 0	$ 919	$ 0

XML

Fair Value - Assets and Liabilities Measured at Fair Value on Non-Recurring Basis (Details) - Fair Value, Measurements, Nonrecurring - Individually Analyzed Loans - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Commercial and Industrial Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	$ 1,664	$ 1,858
Commercial Real Estate Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	7,266	10,040
Agricultural Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	2,919	2,970
Consumer Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	9	8
Home Equity Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	362	368
Residential Mortgage Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	546	718
Quoted Prices in Active Markets for Identical Assets (Level 1) | Commercial and Industrial Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Commercial Real Estate Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Agricultural Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Consumer Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Home Equity Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Residential Mortgage Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	0	0
Significant Other Observable Inputs (Level 2) | Commercial and Industrial Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	0	0
Significant Other Observable Inputs (Level 2) | Commercial Real Estate Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	0	0
Significant Other Observable Inputs (Level 2) | Agricultural Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	0	0
Significant Other Observable Inputs (Level 2) | Consumer Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	0	0
Significant Other Observable Inputs (Level 2) | Home Equity Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	0	0
Significant Other Observable Inputs (Level 2) | Residential Mortgage Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	0	0
Significant Unobservable  Inputs (Level 3) | Commercial and Industrial Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	1,664	1,858
Significant Unobservable  Inputs (Level 3) | Commercial Real Estate Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	7,266	10,040
Significant Unobservable  Inputs (Level 3) | Agricultural Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	2,919	2,970
Significant Unobservable  Inputs (Level 3) | Consumer Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	9	8
Significant Unobservable  Inputs (Level 3) | Home Equity Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	362	368
Significant Unobservable  Inputs (Level 3) | Residential Mortgage Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value Assets	$ 546	$ 718

XML

Fair Value - Quantitative Information of Fair Value Measurements (Details) - Significant Unobservable  Inputs (Level 3) - Individually Analyzed Loans $ in Thousands	Jun. 30, 2023 USD ($)	Dec. 31, 2022 USD ($)
Commercial and Industrial Loans | Adjustment for physical condition of comparable properties sold | Minimum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	0	0
Commercial and Industrial Loans | Adjustment for physical condition of comparable properties sold | Maximum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	1	1
Commercial and Industrial Loans | Adjustment for physical condition of comparable properties sold | Weighted Average
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	0.40	0.40
Commercial Real Estate Loans | Adjustment for physical condition of comparable properties sold | Minimum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	0.25	0.30
Commercial Real Estate Loans | Adjustment for physical condition of comparable properties sold | Maximum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	0.68	1
Commercial Real Estate Loans | Adjustment for physical condition of comparable properties sold | Weighted Average
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	0.36	0.37
Agricultural Loans | Adjustment for physical condition of comparable properties sold | Minimum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	0.30	0.30
Agricultural Loans | Adjustment for physical condition of comparable properties sold | Maximum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	1	1
Agricultural Loans | Adjustment for physical condition of comparable properties sold | Weighted Average
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	0.50	0.48
Consumer Loans | Adjustment for physical condition of comparable properties sold | Minimum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	0.20	0.27
Consumer Loans | Adjustment for physical condition of comparable properties sold | Maximum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	0.27	1
Consumer Loans | Adjustment for physical condition of comparable properties sold | Weighted Average
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	0.20	0.20
Home Equity Loans | Adjustment for physical condition of comparable properties sold | Minimum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	0.20	0.20
Home Equity Loans | Adjustment for physical condition of comparable properties sold | Maximum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	0.20	0.51
Home Equity Loans | Adjustment for physical condition of comparable properties sold | Weighted Average
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	0.20	0.20
Residential Mortgage Loans | Adjustment for physical condition of comparable properties sold | Minimum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	0.20	0.20
Residential Mortgage Loans | Adjustment for physical condition of comparable properties sold | Maximum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	1	1
Residential Mortgage Loans | Adjustment for physical condition of comparable properties sold | Weighted Average
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Range (Weighted Average)	0.20	0.21
Fair Value, Measurements, Nonrecurring | Commercial and Industrial Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	$ 1,664	$ 1,858
Fair Value, Measurements, Nonrecurring | Commercial Real Estate Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	7,266	10,040
Fair Value, Measurements, Nonrecurring | Agricultural Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	2,919	2,970
Fair Value, Measurements, Nonrecurring | Consumer Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	9	8
Fair Value, Measurements, Nonrecurring | Home Equity Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	362	368
Fair Value, Measurements, Nonrecurring | Residential Mortgage Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	$ 546	$ 718

XML

Fair Value - Carrying Amounts and Estimated Fair Values of Company's Financial Instruments (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Financial Assets:
Interest Bearing Time Deposits with Banks	$ 500	$ 500
Financial Liabilities:
Demand, Savings, and Money Market Deposits	(5,179,705)	(5,350,051)
Time Deposits	(582,745)	(428,469)
Carrying Value
Financial Assets:
Cash and Short-term Investments	140,671	119,079
Interest Bearing Time Deposits with Banks	500	500
Loans, Net	3,768,977	3,724,804
Accrued Interest Receivable	25,996	27,741
Financial Liabilities:
Demand, Savings, and Money Market Deposits	(4,596,960)	(4,921,582)
Time Deposits	(582,745)	(428,469)
Short-term Borrowings	(99,674)	(101,161)
Long-term Debt	(127,810)	(102,645)
Accrued Interest Payable	(3,896)	(1,513)
Estimate of Fair Value Measurement
Financial Assets:
Cash and Short-term Investments	140,671	119,079
Interest Bearing Time Deposits with Banks	500	500
Loans, Net	3,691,120	3,688,903
Accrued Interest Receivable	25,996	27,741
Financial Liabilities:
Demand, Savings, and Money Market Deposits	(4,596,960)	(4,921,582)
Time Deposits	(578,094)	(426,184)
Short-term Borrowings	(99,674)	(101,161)
Long-term Debt	(123,871)	(99,102)
Accrued Interest Payable	(3,896)	(1,513)
Estimate of Fair Value Measurement | Level 1
Financial Assets:
Cash and Short-term Investments	78,223	77,174
Interest Bearing Time Deposits with Banks	0	0
Loans, Net	0	0
Accrued Interest Receivable	0	38
Financial Liabilities:
Demand, Savings, and Money Market Deposits	(4,596,960)	(4,921,582)
Time Deposits	0	0
Short-term Borrowings	(47,800)	(36,200)
Long-term Debt	0	0
Accrued Interest Payable	0	0
Estimate of Fair Value Measurement | Level 2
Financial Assets:
Cash and Short-term Investments	62,448	41,905
Interest Bearing Time Deposits with Banks	500	500
Loans, Net	0	0
Accrued Interest Receivable	10,143	10,863
Financial Liabilities:
Demand, Savings, and Money Market Deposits	0	0
Time Deposits	(578,094)	(426,184)
Short-term Borrowings	(51,874)	(64,961)
Long-term Debt	(51,978)	(26,830)
Accrued Interest Payable	(3,534)	(1,205)
Estimate of Fair Value Measurement | Level 3
Financial Assets:
Cash and Short-term Investments	0	0
Interest Bearing Time Deposits with Banks	0	0
Loans, Net	3,691,120	3,688,903
Accrued Interest Receivable	15,853	16,840
Financial Liabilities:
Demand, Savings, and Money Market Deposits	0	0
Time Deposits	0	0
Short-term Borrowings	0	0
Long-term Debt	(71,893)	(72,272)
Accrued Interest Payable	$ (362)	$ (308)

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Other Comprehensive Income (Loss) - Changes in AOCI (Details) - USD ($) $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2022	Mar. 31, 2022	Jun. 30, 2023	Jun. 30, 2022
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning Balances	$ 605,331	$ 558,393	$ 649,036	$ 668,459	$ 558,393	$ 668,459
Other Comprehensive Income (Loss) Before Reclassification	(18,330)		(92,632)		14,618	(226,223)
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(30)		(62)		(32)	(356)
Total Other Comprehensive Income (Loss)	(18,360)	32,946	(92,694)	(133,885)	14,586	(226,579)
Ending Balances	602,565	605,331	574,429	649,036	602,565	574,429
Total
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning Balances	(230,492)	(263,438)	(118,401)	15,484	(263,438)	15,484
Total Other Comprehensive Income (Loss)	(18,360)	32,946	(92,694)	(133,885)
Ending Balances	(248,852)	(230,492)	(211,095)	(118,401)	(248,852)	(211,095)
Unrealized Gains and Losses on Available-for-Sale Securities
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning Balances	(229,978)	(262,924)	(117,833)	16,052	(262,924)	16,052
Other Comprehensive Income (Loss) Before Reclassification	(18,330)		(92,632)		14,618	(226,223)
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(30)		(62)		(32)	(356)
Total Other Comprehensive Income (Loss)	(18,360)		(92,694)		14,586	(226,579)
Ending Balances	(248,338)	(229,978)	(210,527)	(117,833)	(248,338)	(210,527)
Postretirement Benefit Items
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning Balances	(514)	(514)	(568)	(568)	(514)	(568)
Other Comprehensive Income (Loss) Before Reclassification	0		0		0	0
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	0		0		0	0
Total Other Comprehensive Income (Loss)	0		0		0	0
Ending Balances	$ (514)	$ (514)	$ (568)	$ (568)	$ (514)	$ (568)

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Other Comprehensive Income (Loss) - Classifications out of AOCI (Details) - USD ($) $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2022	Mar. 31, 2022	Jun. 30, 2023	Jun. 30, 2022
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Net Gains on Securities	$ 38		$ 78		$ 40	$ 450
Income Tax Expense	(4,755)		(5,029)		(9,208)	(5,698)
NET INCOME	22,123	$ 20,807	23,747	$ 9,067	42,930	32,814
Total Reclassifications	30		62		32	356
Amount Reclassified From Accumulated Other Comprehensive Income (Loss)
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Total Reclassifications	30		62		32	356
Amount Reclassified From Accumulated Other Comprehensive Income (Loss) | Amount Reclassified From Accumulated Other Comprehensive Income (Loss)
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Net Gains on Securities	38		78		40	450
Income Tax Expense	(8)		(16)		(8)	(94)
NET INCOME	30		62		32	356
Total Reclassifications	$ 30		$ 62		$ 32	$ 356

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Revenue Recognition (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Disaggregation of Revenue [Line Items]
Non-interest Income (out-of-scope of Topic 606)	$ 1,736	$ 2,426	$ 3,184	$ 5,187
TOTAL NON-INTEREST INCOME	14,896	15,180	29,863	31,368
Accounting Standards Update 2014-09
Disaggregation of Revenue [Line Items]
Non-interest Income (in-scope of Topic 606)	13,160	12,754	26,679	26,181
Wealth Management Fees
Disaggregation of Revenue [Line Items]
Non-interest Income (in-scope of Topic 606)	2,912	2,642	5,556	5,280
Wealth Management Fees | Accounting Standards Update 2014-09
Disaggregation of Revenue [Line Items]
Non-interest Income (in-scope of Topic 606)	2,912	2,642	5,556	5,280
Service Charges on Deposit Accounts
Disaggregation of Revenue [Line Items]
Non-interest Income (in-scope of Topic 606)	2,883	2,871	5,671	5,554
Service Charges on Deposit Accounts | Transferred at Point in Time | Accounting Standards Update 2014-09
Disaggregation of Revenue [Line Items]
Non-interest Income (in-scope of Topic 606)	2,883	2,871	5,671	5,554
Insurance Revenues
Disaggregation of Revenue [Line Items]
Non-interest Income (in-scope of Topic 606)	2,130	2,254	5,265	5,975
Insurance Revenues | Transferred over Time | Accounting Standards Update 2014-09
Disaggregation of Revenue [Line Items]
Non-interest Income (in-scope of Topic 606)	2,130	2,254	5,265	5,975
Interchange Fee Income
Disaggregation of Revenue [Line Items]
Non-interest Income (in-scope of Topic 606)	4,412	4,167	8,611	7,794
Interchange Fee Income | Transferred at Point in Time | Accounting Standards Update 2014-09
Disaggregation of Revenue [Line Items]
Non-interest Income (in-scope of Topic 606)	4,412	4,167	8,611	7,794
Other Operating Income | Transferred at Point in Time | Accounting Standards Update 2014-09
Disaggregation of Revenue [Line Items]
Non-interest Income (in-scope of Topic 606)	$ 823	$ 820	$ 1,576	$ 1,578

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Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Finance Lease Cost:
Amortization of Right-of -Use Assets	$ 52	$ 53	$ 105	$ 105
Interest on Lease Liabilities	77	82	155	165
Operating Lease Cost	363	376	736	745
Short-term Lease Cost	0	3	0	27
Total Lease Cost	$ 492	$ 514	$ 996	$ 1,042

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Leases - Weighted Average Lease Term and Discount Rates (Details)	Jun. 30, 2023	Jun. 30, 2022
Weighted Average Remaining Lease Term:
Finance Lease, Weighted Average Remaining Lease Term (in years)	9 years	10 years
Operating Lease, Weighted Average Remaining Lease Term (in years)	7 years	8 years
Weighted Average Discount Rate:
Finance Leases	11.39%	11.43%
Operating Leases	2.84%	2.85%

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Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Jun. 30, 2022
Finance Leases
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration]	Premises, Furniture and Equipment, Net	Premises, Furniture and Equipment, Net
Premises, Furniture and Equipment, Net	$ 1,753	$ 1,963
Finance Lease, Liability, Statement of Financial Position [Extensible Enumeration]	Other Borrowings	Other Borrowings
Other Borrowings	$ 2,753	$ 2,957
Operating Leases
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration]	Accrued Interest Receivable and Other Assets	Accrued Interest Receivable and Other Assets
Operating Lease Right-of-Use Assets	$ 5,674	$ 6,510
Operating Lease, Liability, Statement of Financial Position [Extensible Enumeration]	Accrued Interest Payable and Other Liabilities	Accrued Interest Payable and Other Liabilities
Operating Lease Liabilities	$ 5,816	$ 6,645

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Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Cash paid for amounts in the Measurement of Lease Liabilities:
Operating Cash Flows from Finance Leases	$ 155	$ 166
Operating Cash Flows from Operating Leases	722	701
Financing Cash Flows from Finance Leases	$ 101	$ 91

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Leases - Maturity of Finance and Operating Lease Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Jun. 30, 2022
Finance Leases
Year 1	$ 519
Year 2	519
Year 3	519
Year 4	519
Year 5	445
Thereafter	1,728
Total Lease Payments	4,249
Less Imputed Interest	(1,496)
Total	2,753	$ 2,957
Operating Leases
Year 1	1,272
Year 2	1,134
Year 3	890
Year 4	756
Year 5	627
Thereafter	1,798
Total Lease Payments	6,477
Less Imputed Interest	(661)
Total	$ 5,816	$ 6,645