First Merchants Corporation reported a net income of $56.3 million for the third quarter of 2025, translating to diluted earnings per share of $0.98, compared to $48.7 million and $0.84 per share in the same quarter of the previous year. For the nine months ending September 30, 2025, the corporation's net income available to common stockholders reached $167.5 million, or $2.90 per diluted share, up from $135.6 million and $2.31 per diluted share in the prior year. The increase in profitability is attributed to a rise in net interest income, which amounted to $133.7 million for the quarter, a slight increase from $131.1 million in the same period last year.
Total assets for First Merchants Corporation increased by $499.7 million, or 2.7%, to $18.8 billion as of September 30, 2025, compared to the end of 2024. The growth in assets was primarily driven by a $741.3 million increase in the loan portfolio, which now stands at $13.6 billion, representing a 7.7% annualized growth rate. The composition of the loan portfolio remains predominantly commercial, with commercial and industrial loans making up 33.8% and commercial real estate loans accounting for 16.9%. The allowance for credit losses on loans was $194.5 million, or 1.43% of total loans, reflecting a slight decrease from 1.50% at the end of 2024.
In terms of operational developments, First Merchants Corporation is in the process of merging with First Savings Financial Group, Inc., with the merger agreement signed on September 24, 2025. This strategic move is expected to enhance the corporation's market presence and operational capabilities. The merger is anticipated to close in the first quarter of 2026, pending regulatory approvals and other customary closing conditions. Additionally, the corporation has continued to repurchase shares under its stock repurchase program, having bought back approximately 0.9 million shares for a total of $36.5 million during the nine months ended September 30, 2025.
The corporation's total deposits increased by $348.4 million, or 3.2%, to $14.9 billion, driven by growth in money market and savings deposits. However, noninterest-bearing deposits decreased, reflecting a shift in customer preferences towards interest-bearing products. The loan-to-deposit ratio increased to 91.6% from 88.6% at the end of 2024, indicating a strategic focus on utilizing deposits to fund loan growth. The corporation's capital ratios remain strong, with total risk-based capital at 13.04% and tier 1 capital at 11.49%, both exceeding regulatory requirements for well-capitalized institutions.
Looking ahead, First Merchants Corporation anticipates continued growth in its loan portfolio and overall financial performance, supported by its strategic initiatives, including the upcoming merger and ongoing focus on enhancing customer service and product offerings. The corporation remains vigilant in monitoring economic conditions and credit quality to ensure sustainable growth and profitability.
About FIRST MERCHANTS CORP
First Merchants Corporation is a financial holding company based in Indiana, operating primarily through its full-service bank, First Merchants Bank. It offers community banking services including commercial and consumer banking, mortgage solutions, and wealth management. Serving Indiana, Ohio, and Michigan, it emphasizes personalized service, local decision-making, and comprehensive electronic channels, with assets of $18.3 billion and a focus on community-oriented financial solutions.
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