8-K

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549-1004

FORM 8-K

CURRENT REPORT

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

July 31, 2003
Date of Report (Date of earliest event reported)

GERMAN AMERICAN BANCORP
(Exact name of registrant as specified in its charter)

Indiana
(State or other jurisdiction of incorporation) 0-11244
(Commission File Number) 35-1547518
(IRS Employer Identification Number)

711 Main Street
Box 810
Jasper, Indiana
(Address of principal executive offices)
47546
(Zip Code)

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

Item 7.    Financial Statements and Exhibits.

         (c)        Exhibits

                           99        Press release issued by the Company on July 31, 2003.

Item 12.    Results of Operations and Financial Condition.

On July 31, 2003, German American Bancorp (the “Company”), issued a press release announcing its results for the quarter ended June 30, 2003. A copy of the press release is filed herewith as Exhibit 99 and incorporated herein by reference.

The information contained in this Item 12 or incorporated by reference herein shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

GERMAN AMERICAN BANCORP



By:  /s/ Mark A. Schroeder Mark A. Schroeder, President and
Chief Executive Officer

Dated:    August 4, 2003

EXHIBIT INDEX

99                 Press release issued by the Company on July 31, 2003.

EX-99

Page 1 of 3

JASPER, INDIANA JULY 31, 2003 GERMAN AMERICAN BANCORP ANNOUNCES
QUARTERLY CASH DIVIDEND AND EARNINGS

German American Bancorp (NASDAQ: GABC) announced that its Board of Directors has declared the Company’s regular cash dividend for the second quarter. The dividend of $0.14 per share will be payable on or before August 20, 2003 to shareholders of record as of August 10, 2003. This level of cash dividend equates to an approximate annualized dividend yield of 3.05% based on the closing price of the Company’s stock on NASDAQ on July 30, 2003.

The Company’s 2003 earnings per share for the three months ended June 30, 2003 were $0.20, a modest decrease of one cent per share from the $0.21 per share reported for the same period in the prior year. On a year-to-date basis, 2003 earnings per share were $0.41 per share, compared to reported earnings of $0.43 per share in 2002. The earnings per share in 2003 include the effect of the Company’s repurchase of over 1 million of its common shares pursuant to its self-tender offer which was completed late in the first quarter of 2003. These levels of per share earnings equate to net income of $2,043,000 and $4,481,000, respectively, for the second quarter and first half of 2003 compared to $2,380,000 and $4,898,000 for the same periods last year.

The earnings comparisons, on both a quarterly and year-to-date basis, were significantly impacted by the effects of historically low interest rates. The Company’s net interest income has declined by $1,144,000 year-to-date in 2003 relative to the levels of 2002 with $895,000 of this decline occurring during the second quarter. These net interest income declines were due both to decreased net interest margins in 2003 and to reduced average balances in the Company’s residential mortgage portfolio, offset in large part by increased average balances in the Company’s commercial loan portfolio. The reduction in the Company’s residential mortgage loan portfolio was the result of the continued refinance activity during the first half of 2003 (fueled by the historically low interest rates), coupled with the Company’s decision to sell the majority of its production of long-term fixed rate mortgage loans to the secondary market.

Page 2 of 3

The continued decline in the level of interest rates throughout 2003 has also resulted in increased prepayment speeds within the Company’s mortgage-backed investment securities and mortgage servicing portfolios and reduced net mortgage servicing revenue. Due to the low level of interest rates, the Company is unable to reinvest the proceeds of the mortgage-backed securities at comparable yields. While management believes the Company’s current asset sensitive interest rate risk position will allow the Company to reap long-term benefits from sustained future increases in interest rates, further reductions of the Company’s levels of net interest income and net interest margin are likely in the near future if market interest rates remain at current levels or decline.

The impact of reduced net interest income during the second quarter and first half of 2003 was partially offset by double-digit percentage increases in nearly every category of non-interest income. Additionally, the Company’s focus on maximizing operating efficiency showed continued progress as evidenced by virtually no dollar increase in the level of salaries & employee benefits, the Company’s largest non-interest-related operating expense category, during the first half of the year.

Commenting on the 2003 operating results, Company President & CEO, Mark A. Schroeder, stated, “The challenges of operating within the financial services industry during this period of fifty-year lows in interest rates were clearly evident in our second quarter results. While the continuation of these low levels of interest rates has resulted in contraction of our margins, as it has in many other financial institutions throughout the country, we’re pleased that the steps we have taken in recent years to strengthen other areas of our operations significantly mitigated the impact of these reduced margins. Our efforts to develop and grow sources of fee income that are not tied to net interest income, such as insurance, investment, and trust revenues, paid dividends during the quarter as we experienced considerable growth within each of these areas.”

Schroeder continued, “Additionally, our investment in recent years in the personnel, products, and services within our business banking group continues to generate solid returns in terms of impressive commercial loan growth. Furthermore, we have successfully generated this level of commercial loan growth without sacrificing quality as demonstrated by our relatively low ratio of non-performing loans to total loans. Area businesses, in increasing numbers, are turning to their local German American affiliated community bank for all their financial needs. We’re very pleased that the combination of our highly qualified banking professionals, local decision making, and customer-focused products and services has found a receptive audience within the local business communities.”

Page 3 of 3

German American Bancorp is a financial services holding company based in Jasper, Indiana. The Company’s Common Stock is traded on NASDAQ’s National Market System under the symbol GABC. The Company operates five affiliated community banks with 26 retail banking offices in the eight contiguous Southwestern Indiana counties of Daviess, Dubois, Gibson, Knox, Martin, Perry, Pike, Spencer and a business lending center in Evansville, Indiana. The Company also operates German American Financial Advisors and Trust Company, a trust, brokerage and financial planning subsidiary operating from the banking offices of the bank subsidiaries and The Doty Agency, Inc., a full-line property and casualty insurance subsidiary with four independent insurance offices throughout its market area. The Company’s lines of business include retail and commercial banking, mortgage banking, comprehensive wealth management, full service brokerage and trust administration, title insurance, and a full range of personal and corporate insurance products.

Forward-Looking Statements
The Company’s statements in this press release regarding its expectation of changes in its net interest income and net interest margin are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Readers are cautioned that, by their nature, forward-looking statements are based on assumptions and are subject to risks, uncertainties, and other factors. Changes in the Company’s future net interest income and net interest margin may vary materially from those that are presently expected, due to such factors as changes in interest rates; the effects of changes in competitive conditions; the introduction, withdrawal, success and timing of asset/liability management strategies or of business initiatives and business strategies; changes in customer borrowing, repayment, investment and deposit practices; changes in fiscal, monetary and tax policies; changes in financial and capital markets; changes in general economic conditions, either nationally or regionally; capital management activities; actions of the Federal Reserve Board; and legislative and regulatory actions and reforms. These forward-looking statements speak only as of the date of this press release and the Company undertakes no obligation to update any such forward-looking statement to reflect events or circumstances that occur after the date hereof.

GERMAN AMERICAN BANCORP
(unaudited, dollars in thousands except per share data)

Consolidated Balance Sheets

	June 30,
	2003			2002
ASSETS
Cash and Due from Banks	$	28,275		$	26,584
Short-term Investments		21,349			28,245
Investment Securities		235,109			251,595
Loans Held-for-Sale		3,618			4,869
Loans, Net of Unearned Income		608,789			642,504
Allowance for Loan Losses		(8,538	)		(8,326	)
Net Loans		600,251			634,178
Premises and Equipment		22,049			20,944
Other Assets		25,587			26,379
TOTAL ASSETS	$	936,238		$	992,794
LIABILITIES
Non-interest-bearing Demand Deposits	$	103,718		$	91,027
Interest-bearing Demand, Savings, and
Money Market Accounts		247,862			242,088
Time Deposits < $100,000		298,428			319,442
Time Deposits $100,000 or more and
Brokered Deposits		57,487			58,885
Total Deposits		707,495			711,442
Borrowings		132,184			165,596
Other Liabilities		12,978			11,848
TOTAL LIABILITIES		852,657			888,886
SHAREHOLDERS' EQUITY
Common Stock and Surplus		69,716			81,882
Retained Earnings		13,174			19,689
Accumulated Other Comprehensive Income (Loss)		691			2,337
TOTAL SHAREHOLDERS' EQUITY		83,581			103,908
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY	$	936,238		$	992,794
BOOK VALUE PER SHARE	$	8.01		$	9.05	(1)
END OF PERIOD SHARES OUTSTANDING		10,433,035			10,939,982	(2)

(1)        Restated for December 2002 stock dividend.
(2)        End of period shares outstanding were not restated for the effect of stock dividends.

GERMAN AMERICAN BANCORP
(unaudited, dollars in thousands except per share data)

Consolidated Statements of Income

	Three Months Ended June 30,					Six Months Ended June 30,
	2003		2002			2003		2002
INTEREST INCOME
Interest and Fees on Loans	$	10,641	$	12,277		$	21,529	$	24,861
Interest on Short-term Investments		82		135			138		438
Interest on Investment Securities		2,134		3,017			4,639		5,591
TOTAL INTEREST INCOME		12,857		15,429			26,306		30,890
INTEREST EXPENSE
Interest on Deposits		3,606		4,721			7,370		9,687
Interest on Borrowings		1,916		2,478			3,816		4,939
TOTAL INTEREST EXPENSE		5,522		7,199			11,186		14,626
Net Interest Income		7,335		8,230			15,120		16,264
Provision for Loan Losses		265		297			229		545
Net Interest Income after
Provision for Loan Losses		7,070		7,933			14,891		15,719
NON-INTEREST INCOME
Other Operating Income		2,055		1,973			4,028		4,033
Net Gain on Sales of Loans and Related Assets		769		242			1,306		623
Net Gain on Sales of Securities		---		---			23		---
TOTAL NON-INTEREST INCOME		2,824		2,215			5,357		4,656
NON-INTEREST EXPENSE
Salaries and Benefits		4,419		4,373			8,841		8,818
Other Operating Expenses		3,096		2,864			5,997		5,517
TOTAL NON-INTEREST EXPENSE		7,515		7,237			14,838		14,335
Income before Income Taxes		2,379		2,911			5,410		6,040
Income Tax Expense		336		531			929		1,142
NET INCOME	$	2,043	$	2,380		$	4,481	$	4,898
EARNINGS PER SHARE	$	0.20	$	0.21	(1)	$	0.41	$	0.43	(1)
DILUTED EARNINGS PER SHARE	$	0.20	$	0.21	(1)	$	0.41	$	0.42	(1)
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic		10,422,182		11,488,190	(1)		10,883,270		11,513,845	(1)
Diluted		10,463,790		11,521,142	(1)		10,925,130		11,541,848	(1)

(1)        Restated for December 2002 stock dividend.