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

January 27, 2010

Date of Report (Date of earliest event reported)

GERMAN AMERICAN BANCORP, INC.

(Exact name of registrant as specified in its charter)

Indiana		35-1547518
(State or other jurisdiction of	001-15877	(IRS Employer Identification
incorporation)	(Commission File Number)	Number)

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

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

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

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

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

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

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02.  Results of Operations and Financial Condition.

On January 27, 2010, German American Bancorp, Inc. (the "Company" or "German American"), issued a press release announcing its results for the three month and annual periods ended December 31, 2009, and making other disclosures. The press release (including the accompanying unaudited consolidated financial statements as of and for the three months and twelve months ended December 31, 2009, and other financial data) is furnished herewith as Exhibit 99 and is incorporated herein by reference.

The information incorporated by reference herein from Exhibit 99 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.

Item 8.01.  Other Events.

As announced in the press release that is furnished as Exhibit 99 to this report, the Company's Board of Directors has declared a cash dividend of $0.14 per share which will be payable on February 20, 2010 to shareholders of record as of February 10, 2010.

Item 9.01. Financial Statements, Pro Forma Financial Information and Exhibits.

Exhibits

99 Press release dated January 27, 2010.  This exhibit 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, INC.
By:	/s/ Mark A. Schroeder
	Mark A. Schroeder, Chairman of the Board and Chief Executive Officer

Dated:  January 29, 2010

EXHIBIT INDEX

99 Press release dated January 27, 2010.  This exhibit 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.

EX-99.1

GERMAN AMERICAN BANCORP, INC.

NEWS RELEASE

For additional information, contact:

Mark A Schroeder, Chief Executive Officer of German American Bancorp, Inc.

Bradley M Rust, Executive Vice President/CFO of German American Bancorp, Inc.

(812) 482-1314

1 of 14

January 27, 2010	GERMAN AMERICAN BANCORP, INC. (GABC)
	REPORTS STRONG 4th QUARTER AND 2009 ANNUAL
	EARNINGS

Summary

German American Bancorp, Inc. (NASDAQ: GABC) today reported yet another quarter of strong earnings, posting 4th quarter net income of $3,321,000, or $0.30 per share.  This represents the second highest level of quarterly earnings in the Company’s history, exceeded only by the quarterly earnings recorded in the 4th quarter of 2008.  Inclusive of the strong 4th quarter results, 2009 reported earnings were $12,218,000, or $1.10 per share.  This level of annual earnings also represents the second highest reported annual financial performance in the Company’s history

In the face of a more difficult economic and operating environment in the current year, the strong level of 2009 annual earnings was only approximately 5% under the record net income of $12,803,000, or $1.16 per share, earned in 2008.  The Company’s current year performance was enhanced by a $3.6 million, or nearly a 9%, improvement in net interest income.  This improvement in net interest income resulted from the combination of an increase in the Company’s average balance of loans and investments of approximately $62 million, or nearly 6%, and an increase in the net interest margin to 3.95% as compared to 3.82% in 2008.

The Company also strengthened its level of loan loss reserves by adding approximately $1.5 million to its allowance for loan losses during the year, while the provision for loan losses was approximately $250 thousand less than what was required in provision expense in 2008.  The Company also significantly enhanced its capital position during 2009.  Largely as a result of the strong 2009 retained earnings, the Company’s capital strength, in the form of total shareholders’ equity, increased by $8.4 million, or nearly 8%, during the year.

In a direct reflection of the weakened economic environment in which the Company operated during 2009, revenues and fees generated from the Company’s insurance, investment, and trust activities declined by approximately $1.7 million, or nearly 20%, during the year while fees derived from deposit service charges declined by $500 thousand, or 11%.  Additionally, the Company experienced approximately $1.7 million in additional operating expenses due to significant increases in the level of FDIC insurance premiums, resulting from an industry-wide increase in deposit insurance assessments as the FDIC began charging higher deposit insurance premiums to all depository institutions, including healthy banks, in order to recapitalize the deposit insurance fund.  Additionally, the Company experienced approximately $1.0 million in higher health insurance costs in 2009 due to elevated claims experience within the Company’s partially self-insured health insurance plan.

GERMAN AMERICAN BANCORP, INC.

NEWS RELEASE

For additional information, contact:

Mark A Schroeder, Chief Executive Officer of German American Bancorp, Inc.

Bradley M Rust, Executive Vice President/CFO of German American Bancorp, Inc.

(812) 482-1314

2 of 14

Mark A. Schroeder, Chief Executive Officer of German American, commenting on the 2009 financial results stated, “We continue to be very pleased that, in the face of a very difficult economic and operating environment, we were able to yet again post a very strong quarter and year in terms of earnings performance.  German American’s ability to achieve the two best years in our history in terms of financial performance during 2008 and 2009 stands in contrast to the majority of the banking industry, in which many companies posted the two worst years in their history during this same time period.  The achievement of this feat didn’t occur by accident, but rather it is the cumulative result of years of hard work and steadfast commitment to conservative, time-tested financial management strategies by a talented and dedicated group of financial professionals.

German American’s superior operating performance in the face of the current economic challenges is being recognized on both a regional and national level, culminating with an invitation to participate in a meeting at the White House with President Obama and key members of his Administration late in the 4th quarter.  At the meeting, German American was one of only 12 community banks from throughout the country from which the Administration sought input relative to the challenges and opportunities facing community banks in the current economic environment.”

Schroeder continued, “It was most certainly an honor for our organization to be invited to participate in the meeting with the President and we appreciate the positive response we received regarding our performance from the financial media and the strong level of stock performance we enjoyed during 2009, but we also recognize that we are not immune from the effect of a continued stagnant economic environment.  That said, we firmly believe that our management philosophy will serve us well in both good and more difficult times, and that, executed effectively, the conservative, time-tested financial management strategies derived from that philosophy will consistently deliver the achievement of our overall goal of superior top-quartile financial performance when compared to peer Midwestern banking companies.”

The Company also announced that its Board of Directors declared its regular quarterly cash dividend of $0.14 per share which will be payable on February 20, 2010 to shareholders of record as of February 10, 2010.

German American Bancorp, Inc. is a financial services holding company based in Jasper, Indiana. The Company’s Common Stock is traded on NASDAQ’s Global Select Market System under the symbol GABC.  The principal subsidiary of German American Bancorp, Inc. is its banking subsidiary, German American Bancorp which operates 28 retail banking offices in the ten contiguous Southern Indiana counties of Daviess, Dubois, Gibson, Knox, Lawrence, Martin, Monroe, Perry, Pike, and Spencer. German American Bancorp owns a trust, brokerage and financial planning subsidiary which operate from its banking offices and a full line property and casualty insurance agency with seven insurance agency offices throughout its market area.

GERMAN AMERICAN BANCORP, INC.

NEWS RELEASE

For additional information, contact:

Mark A Schroeder, Chief Executive Officer of German American Bancorp, Inc.

Bradley M Rust, Executive Vice President/CFO of German American Bancorp, Inc.

(812) 482-1314

3 of 14

Balance Sheet Highlights

End-of-period loans outstanding declined 4% on an annualized basis during the fourth quarter of 2009 compared with the quarter-ended September 30, 2009 and approximately 1% during the year-ended December 31, 2009 compared with the year ended 2008.  The overall decline in the level of loans has largely been driven by soft loan demand in the commercial and consumer portfolios attributable to a difficult and cautious economic environment.  The decline in the residential portfolio was attributable to the significant refinance activity throughout 2009 in a historically low interest rate environment in which the Company sold the majority of its residential mortgage loan production into the secondary market.

End of Period Loan Balances								Annualized
	12/31/09		09/30/09		$ Change			% Change
Commercial & Industrial Loans	$	523,217	$	529,868	$	(6,651	)		-5	%
Agricultural Loans		156,845		152,758		4,087			11	%
Consumer Loans		114,736		119,489		(4,753	)		-16	%
Residential Mortgage Loans		84,677		87,099		(2,422	)		-11	%
	$	879,475	$	889,214	$	(9,739	)		-4	%

End of Period Loan Balances								Annual
	12/31/09		12/31/08		$ Change			% Change
Commercial & Industrial Loans	$	523,217	$	505,191	$	18,026			4	%
Agricultural Loans		156,845		159,923		(3,078	)		-2	%
Consumer Loans		114,736		127,343		(12,607	)		-10	%
Residential Mortgage Loans		84,677		100,054		(15,377	)		-15	%
	$	879,475	$	892,511	$	(13,036	)		-1	%

Non-performing loans totaled $8.8 million at December 31, 2009 compared to $9.9 million of non-performing loans at September 30, 2009.  Non-performing loans represented 1.00% of total outstanding loans at December 31, 2009 compared with 1.12% of total loans outstanding at September 30, 2009.  The majority of this decline was the result of a single commercial real estate loan that migrated from the non-performing loan category to other real estate as of year-end 2009.  Non-performing loans totaled $8.4 million at year-end 2008 or 0.94% of total loans outstanding at December 31, 2008.

GERMAN AMERICAN BANCORP, INC.

NEWS RELEASE

For additional information, contact:

Mark A Schroeder, Chief Executive Officer of German American Bancorp, Inc.

Bradley M Rust, Executive Vice President/CFO of German American Bancorp, Inc.

(812) 482-1314

4 of 14

The Company’s allowance for loan losses totaled $11.0 million at December 31, 2009, an increase of $228,000 or 2%, compared with $10.8 million at September 30, 2009.  The allowance for loan losses represented 1.25% of period end loans at December 31, 2009 compared with 1.22% at September 30, 2009. The allowance for loan losses represented 125% of period end non-performing loans at December 31, 2009 and 109% of period end non-performing loans at September 30, 2009.  The allowance for loan loss totaled $9.5 million at year-end 2008 and represented 1.07% of total loans and 114% of non-performing loans at December 31, 2008.

End-of-period deposits increased approximately 3% during both the quarter-ended and year-ended December 31, 2009 compared with the quarter ended September 30, 2009 and year ended December 31, 2008.  The increase was attributable to growth of the Company’s core deposit base throughout its primary market area.

End of Period Deposit Balances								Annualized
	12/31/09		09/30/09		$ Change			% Change
Non-interest-bearing Demand Deposits	$	155,268	$	147,704	$	7,564			20	%
Interest-bearing Demand, Savings,
& Money Market Accounts		484,699		475,506		9,193			8	%
Time Deposits < $100,000		256,401		253,082		3,319			5	%
Time Deposits of $100,000 or more
& Brokered Deposits		73,275		85,046		(11,771	)		-55	%
	$	969,643	$	961,338	$	8,305			3	%

End of Period Deposit Balances								Annual
	12/31/09		12/31/08		$ Change			% Change
Non-interest-bearing Demand Deposits	$	155,268	$	147,977	$	7,291			5	%
Interest-bearing Demand, Savings,
& Money Market Accounts		484,699		439,305		45,394			10	%
Time Deposits < $100,000		256,401		250,339		6,062			2	%
Time Deposits of $100,000 or more
& Brokered Deposits		73,275		104,129		(30,854	)		-30	%
	$	969,643	$	941,750	$	27,893			3	%

GERMAN AMERICAN BANCORP, INC.

NEWS RELEASE

For additional information, contact:

Mark A Schroeder, Chief Executive Officer of German American Bancorp, Inc.

Bradley M Rust, Executive Vice President/CFO of German American Bancorp, Inc.

(812) 482-1314

5 of 14

Results of Operations Highlights

Year ended December 31, 2009 compared to year ended December 31, 2008

Net income for the year ended December 31, 2009 totaled $12,218,000, a decrease of $585,000 or 5% from the year ended December 31, 2008 net income of $12,803,000.

Summary Average Balance Sheet

(Tax-equivalent basis / $ in Thousands)

	Year Ended December 31, 2009							Year Ended December 31, 2008
	Principal		Income/		Yield/			Principal		Income/		Yield/
	Balance		Expense		Rate			Balance		Expense		Rate
Assets
Federal Funds Sold and Other
Short-term Investments	$	41,085	$	106		0.26	%	$	35,064	$	593		1.69	%
Securities		215,994		10,274		4.76	%		170,771		9,171		5.37	%
Loans and Leases		891,322		54,166		6.08	%		880,630		58,669		6.66	%
Total Interest Earning Assets	$	1,148,401	$	64,546		5.62	%	$	1,086,465	$	68,433		6.30	%
Liabilities
Demand Deposit Accounts	$	149,673						$	140,962
Interest-bearing Demand, Savings,
and Money Market Accounts	$	473,214	$	3,241		0.68	%	$	422,060	$	6,846		1.62	%
Time Deposits		341,041		10,254		3.01	%		359,115		14,366		4.00	%
FHLB Advances and Other
Borrowings		143,332		5,728		4.00	%		138,888		5,696		4.10	%
Total Interest-Bearing Liabilities	$	957,587	$	19,223		2.01	%	$	920,063	$	26,908		2.92	%
Cost of Funds						1.67	%						2.48	%
Net Interest Income			$	45,323						$	41,525
Net Interest Margin						3.95	%						3.82	%

During the year ended December 31, 2009, net interest income totaled $44,513,000 representing an increase of $3,576,000 or 9% from the year ended December 31, 2008.  The tax equivalent net interest margin for the year ended 2009 was 3.95% compared to 3.82% in 2008.

The provision for loan loss totaled $3,750,000 during the year ended December 31, 2009, representing a decline of $240,000 or 6% from the year ended December 31, 2008.  During 2009, the provision for loan loss represented approximately 42 basis points of average loans while net charge-offs represented approximately 25 basis points of average loans.

During the year ended December 31, 2009, non-interest income declined approximately 13% from the year ended December 31, 2008.

GERMAN AMERICAN BANCORP, INC.

NEWS RELEASE

For additional information, contact:

Mark A Schroeder, Chief Executive Officer of German American Bancorp, Inc.

Bradley M Rust, Executive Vice President/CFO of German American Bancorp, Inc.

(812) 482-1314

6 of 14

Non-interest Income	Year			Year
	Ended			Ended
	12/31/09			12/31/08		$ Change			% Change
Trust and Investment Product Fees	$	1,617		$	2,288	$	(671	)		-29	%
Service Charges on Deposit Accounts		4,395			4,920		(525	)		-11	%
Insurance Revenues		5,296			6,306		(1,010	)		-16	%
Company Owned Life Insurance		1,104			791		313			40	%
Other Operating Income		2,110			2,412		(302	)		-13	%
Subtotal		14,522			16,717		(2,195	)		-13	%
Net Gains on Sales of Loans and
Related Assets		1,760			1,399		361			26	%
Net Gain (Loss) on Securities		(423	)		94		(517	)		n/m
Total Non-interest Income	$	15,859		$	18,210	$	(2,351	)		-13	%

n/m = not meaningful

Trust and investment product fees decreased 29% during the year ended December 31, 2009 compared with the year ended December 31, 2008.  This decline was primarily attributable to continued difficult market conditions and changes in customers’ investment preferences.  Deposit service charges and fees declined by 11% due in large part to less customer utilization of the Company’s overdraft protection program.  Insurance revenues declined 16% during the year ended December 31, 2009 compared with 2008.The decline was largely attributable to a decrease in contingency revenue and lower levels of commercial insurance revenues from the Company’s property and casualty insurance subsidiary.  Company owned life insurance income increased 40% during 2009 compared with 2008 resulting from death benefits received from life insurance policies during 2009.

During 2009, the net gain on sale of residential loans increased 26% from the gain recognized in 2008 driven largely by a higher level of loans sold into the secondary market during 2009 as compared to 2008.  The net loss on securities during 2009 was related to the recognition of other-than-temporary impairment charges on the Company’s portfolio of non-controlling investments in other banking organizations.

GERMAN AMERICAN BANCORP, INC.

NEWS RELEASE

For additional information, contact:

Mark A Schroeder, Chief Executive Officer of German American Bancorp, Inc.

Bradley M Rust, Executive Vice President/CFO of German American Bancorp, Inc.

(812) 482-1314

7 of 14

During the year ended December 31, 2009, non-interest expense increased approximately 10% compared with year ended December 31, 2008.

Non-interest Expense	Year		Year
	Ended		Ended
	12/31/09		12/31/08		$ Change			% Change
Salaries and Employee Benefits	$	21,961	$	20,786	$	1,175			6	%
Occupancy, Furniture and Equipment Expense		6,035		5,677		358			6	%
FDIC Premiums		1,863		209		1,654			791	%
Data Processing Fees		1,368		1,493		(125	)		-8	%
Professional Fees		1,740		1,670		70			4	%
Advertising and Promotion		993		1,078		(85	)		-8	%
Intangible Amortization		909		889		20			2	%
Other Operating Expenses		5,522		4,914		608			12	%
Total Non-interest Expense	$	40,391	$	36,716	$	3,675			10	%

Salaries and benefits expense increased approximately 6% during 2009 compared with 2008.  The increase was primarily the result of increased costs associated with the Company’s partially self-insured health insurance plan.  Occupancy, furniture and equipment expense increased 6% during 2009 compared with 2008 due in large part to depreciation expense associated with renovations of existing branch facilities and upgrades to and purchases of information technology systems.

The Company’s FDIC deposit insurance assessments increased 791% during the year-ended December 31, 2009 compared with the same period of 2008.  This increase resulted from an industry-wide increase in quarterly assessments as the FDIC began to recapitalize the deposit insurance fund, in addition to an industry wide special assessment in the second quarter of 2009 of approximately $550,000 which represented 5 basis points of the Company’s subsidiary bank’s total assets less Tier 1 Capital.

Other operating expenses increased by 12% during the year ended December 31, 2009 compared with 2008.  The increase was largely attributable to an increased level of loan collection costs during 2009 and to amortization expense related to a new markets tax credit project in which the Company invested in the fourth quarter of 2009.

GERMAN AMERICAN BANCORP, INC.

NEWS RELEASE

For additional information, contact:

Mark A Schroeder, Chief Executive Officer of German American Bancorp, Inc.

Bradley M Rust, Executive Vice President/CFO of German American Bancorp, Inc.

(812) 482-1314

8 of 14

Quarter ended December 31, 2009 compared to quarter ended September 30, 2009

Net income for the quarter ended December 31, 2009 totaled $3,321,000, an increase of $130,000 or 4% from third quarter 2009 net income of $3,191,000.

Summary Average Balance Sheet

(Tax-equivalent basis / $ in Thousands)

	Quarter Ended December 31, 2009							Quarter Ended September 30, 2009
	Principal		Income/		Yield/			Principal		Income/		Yield/
	Balance		Expense		Rate			Balance		Expense		Rate
Assets
Federal Funds Sold and Other Short-term Investments	$	74,452	$	42		0.22	%	$	36,627	$	25		0.27	%
Securities		230,417		2,557		4.44	%		216,013		2,570		4.76	%
Loans and Leases		890,740		13,414		5.98	%		903,917		13,773		6.05	%
Total Interest Earning Assets	$	1,195,609	$	16,013		5.32	%	$	1,156,557	$	16,368		5.63	%
Liabilities
Demand Deposit Accounts	$	156,644						$	147,437
Interest-bearing Demand, Savings, and Money Market Accounts	$	507,124	$	736		0.58	%	$	481,052	$	822		0.68	%
Time Deposits		337,294		2,290		2.69	%		336,251		2,307		2.72	%
FHLB Advances and Other Borrowings		151,602		1,497		3.92	%		149,602		1,549		4.11	%
Total Interest-Bearing Liabilities	$	996,020	$	4,523		1.80	%	$	966,905	$	4,678		1.92	%
Cost of Funds						1.50	%						1.61	%
Net Interest Income			$	11,490						$	11,690
Net Interest Margin						3.82	%						4.02	%

During the quarter ended December 31, 2009, net interest income totaled $11,274,000 representing a decrease of $207,000 or 2% compared with the third quarter of 2009.  The tax equivalent net interest margin for the fourth quarter 2009 was 3.82% compared with 4.02% in the third quarter of 2009.  The decline in net interest income and net interest margin was attributable to lower outstanding loan balances and increased levels of core deposits that during much of the fourth quarter 2009 had not been fully invested into the Company’s securities portfolio.

GERMAN AMERICAN BANCORP, INC.

NEWS RELEASE

For additional information, contact:

Mark A Schroeder, Chief Executive Officer of German American Bancorp, Inc.

Bradley M Rust, Executive Vice President/CFO of German American Bancorp, Inc.

(812) 482-1314

9 of 14

The provision for loan loss totaled $750,000 during the quarter ended December 31, 2009, representing a decline of $500,000 or 40% from the third quarter of 2009.  During the fourth quarter of 2009, the annualized provision for loan loss represented approximately 34 basis points of average loans while net charge-offs represented approximately 23 basis points of average loans.

During the quarter ended fourth quarter of 2009, non-interest income decreased approximately 8% from the third quarter of 2009.

Non-interest Income	Qtr Ended			Qtr Ended
	12/31/09			09/30/09		$ Change			% Change
Trust and Investment Product Fees	$	305		$	465	$	(160	)		-34	%
Service Charges on Deposit Accounts		1,124			1,131		(7	)		-1	%
Insurance Revenues		1,265			1,254		11			1	%
Company Owned Life Insurance		466			200		266			133	%
Other Operating Income		643			595		48			8	%
Subtotal		3,803			3,645		158			4	%
Net Gains on Sales of Loans and
Related Assets		323			411		(88	)		-21	%
Net Gain (Loss) on Securities		(389	)		—		(389	)		—	%
Total Non-interest Income	$	3,737		$	4,056	$	(319	)		-8	%

Trust and investment product fees decreased 34% during the quarter ended December 31, 2009 compared with the third quarter of 2009.  This decline was primarily attributable to continued difficult market conditions and internal reorganizations including a change in the Company’s broker/dealer relationship for retail investment products.  Company owned life insurance income increased 133% during fourth quarter of 2009 compared with the third quarter of 2009 resulting from death benefits received from life insurance policies during the quarter ended December 31, 2009.  The net loss on securities during the fourth quarter of 2009 was the result of the recognition of other-than-temporary impairment charges on the Company’s portfolio of non-controlling investments in other banking organizations.

GERMAN AMERICAN BANCORP, INC.

NEWS RELEASE

For additional information, contact:

Mark A Schroeder, Chief Executive Officer of German American Bancorp, Inc.

Bradley M Rust, Executive Vice President/CFO of German American Bancorp, Inc.

(812) 482-1314

10 of 14

During the quarter ended December 31, 2009, non-interest expense increased approximately 2% compared with the third quarter of 2009.

Non-interest Expense	Qtr Ended		Qtr Ended
	12/31/09		09/30/09		$ Change			% Change
Salaries and Employee Benefits	$	5,405	$	5,427	$	(22	)		—	%
Occupancy, Furniture and Equipment Expense		1,504		1,532		(28	)		-2	%
FDIC Premiums		313		330		(17	)		-5	%
Data Processing Fees		346		321		25			8	%
Professional Fees		443		285		158			55	%
Advertising and Promotion		240		266		(26	)		-10	%
Intangible Amortization		232		235		(3	)		-1	%
Other Operating Expenses		1,675		1,523		152			10	%
Total Non-interest Expense	$	10,158	$	9,919	$	239			2	%

Salaries and benefits expense remained stable during the fourth quarter of 2009 compared with the third quarter of 2009.  Professional fees increased 55% during the quarter ended December 31, 2009 compared with the third quarter of 2009.  This increase was primarily attributable to an increased level of legal fees.

Other operating expenses increased by 10% during the fourth quarter of 2009 compared with the third quarter of 2009.  The increase was largely attributable to an increased level of loan collection costs during the fourth quarter 2009 and to amortization expense related to a new markets tax credit project in which the Company invested in the fourth quarter of 2009.  The increase was partially mitigated by reduced loss claims activity at the Company’s captive insurance company.

GERMAN AMERICAN BANCORP, INC.

NEWS RELEASE

For additional information, contact:

Mark A Schroeder, Chief Executive Officer of German American Bancorp, Inc.

Bradley M Rust, Executive Vice President/CFO of German American Bancorp, Inc.

(812) 482-1314

11 of 14

Forward Looking Statements

The Company's statement in this press release regarding the Company’s expectations concerning achieving its goal of superior top quartile financial performance when compared to peer Midwestern banking companies" is a "forward-looking statement” 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. Actual results and experience could differ materially from the anticipated results or other expectations expressed or implied by these forward-looking statements as a result of a number of factors, including but not limited to, those discussed in the press release. Factors that could cause actual experience to differ from the expectations implied in this press release include changes in interest rates; 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; continued deterioration in general economic conditions, either nationally or locally, resulting in, among other things, credit quality deterioration and dampened loan demand; actions of the Federal Reserve Board; changes in accounting principles and interpretations; and actions of the Department of the Treasury and the Federal Deposit Insurance Corporation under the Emergency Economic Stabilization Act of 2008 and the Federal Deposit Insurance Act and other legislative and regulatory actions and reforms. These forward-looking statements speak only as of the date of this press release and German American undertakes no obligation to update any such forward-looking statement to reflect events or circumstances that occur after the date hereof.

GERMAN AMERICAN BANCORP, INC.

NEWS RELEASE

For additional information, contact:

Mark A Schroeder, Chief Executive Officer of German American Bancorp, Inc.

Bradley M Rust, Executive Vice President/CFO of German American Bancorp, Inc.

(812) 482-1314

12 of 14

GERMAN AMERICAN BANCORP, INC.

(unaudited, dollars in thousands except per share data)

Consolidated Balance Sheets

	December 31,			September 30,			December 31,
	2009			2009			2008
ASSETS
Cash and Due from Banks	$	16,052		$	19,137		$	17,201
Short-term Investments		12,002			40,813			27,791
Investment Securities		253,714			206,502			179,166
Loans Held-for-Sale		5,706			8,105			3,166
Loans, Net of Unearned Income		877,822			887,449			890,436
Allowance for Loan Losses		(11,016	)		(10,788	)		(9,522	)
Net Loans		866,806			876,661			880,914
Stock in FHLB and Other Restricted Stock		10,621			10,621			10,621
Premises and Equipment		22,153			22,237			22,330
Goodwill and Other Intangible Assets		12,273			12,505			12,796
Other Assets		43,638			37,234			36,843
TOTAL ASSETS	$	1,242,965		$	1,233,815		$	1,190,828
LIABILITIES
Non-interest-bearing Demand Deposits	$	155,268		$	147,704		$	147,977
Interest-bearing Demand, Savings, and
Money Market Accounts		484,699			475,506			439,305
Time Deposits		329,676			338,128			354,468
Total Deposits		969,643			961,338			941,750
Borrowings		148,121			147,199			131,664
Other Liabilities		11,652			12,888			12,240
TOTAL LIABILITIES		1,129,416			1,121,425			1,085,654
SHAREHOLDERS' EQUITY
Common Stock and Surplus		79,893			79,764			79,401
Retained Earnings		29,041			27,272			23,019
Accumulated Other Comprehensive Income		4,615			5,354			2,754
TOTAL SHAREHOLDERS' EQUITY		113,549			112,390			105,174
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY	$	1,242,965		$	1,233,815		$	1,190,828
END OF PERIOD SHARES OUTSTANDING		11,077,382			11,077,382			11,030,288
BOOK VALUE PER SHARE	$	10.25		$	10.15		$	9.54

GERMAN AMERICAN BANCORP, INC.

NEWS RELEASE

For additional information, contact:

Mark A Schroeder, Chief Executive Officer of German American Bancorp, Inc.

Bradley M Rust, Executive Vice President/CFO of German American Bancorp, Inc.

(812) 482-1314

13 of 14

GERMAN AMERICAN BANCORP, INC.

(unaudited, dollars in thousands except per share data)

Consolidated Statements of Income

	Three Months Ended								Year Ended
	December 31,			September 30,		December 31,			December 31,			December 31,
	2009			2009		2008			2009			2008
INTEREST INCOME
Interest and Fees on Loans	$	13,332		$	13,706	$	14,178		$	53,905		$	58,477
Interest on Short-term Investments		42			25		27			106			593
Interest and Dividends on Investment Securities		2,423			2,428		2,308			9,725			8,775
TOTAL INTEREST INCOME		15,797			16,159		16,513			63,736			67,845
INTEREST EXPENSE
Interest on Deposits		3,026			3,129		4,808			13,495			21,212
Interest on Borrowings		1,497			1,549		1,398			5,728			5,696
TOTAL INTEREST EXPENSE		4,523			4,678		6,206			19,223			26,908
NET INTEREST INCOME		11,274			11,481		10,307			44,513			40,937
Provision for Loan Losses		750			1,250		874			3,750			3,990
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES		10,524			10,231		9,433			40,763			36,947
NON-INTEREST INCOME
Net Gain on Sales of Loans and Related Assets		323			411		341			1,760			1,399
Net Gain (Loss) on Securities		(389	)		-		(85	)		(423	)		94
Other Non-interest Income		3,803			3,645		4,105			14,522			16,717
TOTAL NON-INTEREST INCOME		3,737			4,056		4,361			15,859			18,210
NON-INTEREST EXPENSE
Salaries and Benefits		5,405			5,427		5,116			21,961			20,786
Other Non-interest Expenses		4,753			4,492		4,108			18,430			15,930
TOTAL NON-INTEREST EXPENSE		10,158			9,919		9,224			40,391			36,716
Income before Income Taxes		4,103			4,368		4,570			16,231			18,441
Income Tax Expense		782			1,177		1,217			4,013			5,638
NET INCOME	$	3,321		$	3,191	$	3,353		$	12,218		$	12,803
EARNINGS PER SHARE & DILUTED EARNINGS PER SHARE	$	0.30		$	0.29	$	0.30		$	1.10		$	1.16
WEIGHTED AVERAGE SHARES OUTSTANDING		11,077,382			11,075,709		11,029,624			11,065,917			11,029,519
DILUTED WEIGHTED AVERAGE SHARES OUTSTANDING		11,085,472			11,084,768		11,030,243			11,068,988			11,029,911

GERMAN AMERICAN BANCORP, INC.

NEWS RELEASE

For additional information, contact:

Mark A Schroeder, Chief Executive Officer of German American Bancorp, Inc.

Bradley M Rust, Executive Vice President/CFO of German American Bancorp, Inc.

(812) 482-1314

14 of 14

GERMAN AMERICAN BANCORP, INC.

(unaudited, dollars in thousands except per share data)

	Three Months Ended									Year Ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2009			2009			2008			2009			2008
EARNINGS PERFORMANCE RATIOS
Annualized Return on Average Assets		1.04	%		1.03	%		1.12	%		0.99	%		1.09	%
Annualized Return on Average Equity		11.69	%		11.59	%		13.15	%		11.12	%		12.84	%
Net Interest Margin		3.82	%		4.02	%		3.76	%		3.95	%		3.82	%
Efficiency Ratio (1)		66.71	%		63.00	%		62.13	%		66.02	%		61.46	%
Net Overhead Expense to Average Earning Assets (2)		2.15	%		2.03	%		1.75	%		2.14	%		1.70	%
ASSET QUALITY RATIOS
Annualized Net Charge-offs to Average Loans		0.23	%		0.33	%		0.32	%		0.25	%		0.29	%
Allowance for Loan Losses to Period End Loans		1.25	%		1.22	%		1.07	%
Non-performing Assets to Period End Assets		0.90	%		1.03	%		0.85	%
Non-performing Loans to Period End Loans		1.00	%		1.12	%		0.94	%
Loans 30-89 Days Past Due to Period End Loans		0.64	%		0.81	%		0.91	%
SELECTED BALANCE SHEET & OTHER FINANCIAL DATA
Average Assets	$	1,279,199		$	1,238,386		$	1,201,263		$	1,230,596		$	1,174,583
Average Earning Assets	$	1,195,609		$	1,156,557		$	1,113,173		$	1,148,401		$	1,086,465
Average Total Loans	$	890,740		$	903,917		$	892,435		$	891,322		$	880,630
Average Demand Deposits	$	156,644		$	147,437		$	149,137		$	149,673		$	140,962
Average Interest Bearing Liabilities	$	996,020		$	966,905		$	937,170		$	957,587		$	920,063
Average Equity	$	113,640		$	110,151		$	101,973		$	109,887		$	99,711
Period End Non-performing Assets (3)	$	11,156		$	12,676		$	10,168
Period End Non-performing Loans (4)	$	8,793		$	9,928		$	8,350
Period End Loans 30-89 Days Past Due (5)	$	5,625		$	7,152		$	8,061
Tax Equivalent Net Interest Income	$	11,490		$	11,690		$	10,486		$	45,323		$	41,525
Net Charge-offs during Period	$	522		$	757		$	710		$	2,256		$	2,512

(1) Efficiency Ratio is defined as Non-interest Expense divided by the sum of Net Interest Income, on a tax equivalent basis, and Non-interest Income.

(2) Net Overhead Expense is defined as Total Non-interest Expense less Total Non-interest Income.

(3) Non-performing assets are defined as Non-accrual Loans, Loans Past Due 90 days or more, Restructured Loans, and Other Real Estate Owned.

(4) Non-performing loans are defined as Non-accrual Loans, Loans Past Due 90 days or more, and Restructured Loans.

(5) Loans 30-89 days past due and still accruing.