Financial Performance - Net income for the three months ended September 30, 2025, was $35.07 million, a 66.7% increase compared to $21.05 million for the same period in 2024[18]. - Basic earnings per share for the three months ended September 30, 2025, were $0.94, up from $0.71 in the same period of 2024, reflecting a 32.4% increase[18]. - Comprehensive income for the nine months ended September 30, 2025, was $115,036,000, up from $102,621,000 in 2024, reflecting a 12% growth[24]. - For the three months ended September 30, 2025, net income was $35,074, leading to a basic and diluted earnings per share of $0.94, compared to $21,048 and $0.71 for the same period in 2024[42]. - For the nine months ended September 30, 2025, net income was $76,952, resulting in a basic and diluted earnings per share of $2.10, compared to $60,600 and $2.04 for the same period in 2024[44]. Asset Growth - Total assets increased to $8.40 billion as of September 30, 2025, up from $6.30 billion at December 31, 2024, representing a 33.5% growth[15]. - Total deposits rose to $7.01 billion as of September 30, 2025, compared to $5.33 billion at December 31, 2024, marking a 31.5% increase[15]. - As of September 30, 2025, total loans net amount to $5,702,448, an increase from $4,080,466 as of December 31, 2024, representing a growth of approximately 39.7%[60]. - Segment assets as of September 30, 2025, totaled $8,401,248,000, compared to $6,295,910,000 at the end of 2024, representing an increase of approximately 33%[117]. Income and Expenses - Total non-interest expense for the three months ended September 30, 2025, was $49.70 million, up from $36.13 million in the same period of 2024, indicating a 37.5% increase[18]. - Salaries and employee benefits increased to $25.44 million for the three months ended September 30, 2025, compared to $19.72 million in the same period of 2024, a rise of 29.2%[18]. - Salaries and employee benefits for the nine months ended September 30, 2025, amounted to $80,122,000, compared to $61,853,000 for the same period in 2024, which is an increase of about 29%[117]. Credit Losses - Provision for credit losses increased to $17.20 million for the nine months ended September 30, 2025, compared to $2.15 million for the same period in 2024[21]. - The allowance for credit losses increased to $76,057 as of September 30, 2025, from $44,436 as of December 31, 2024, reflecting a rise of approximately 71.3%[60]. - Loans charged-off during the three months ended September 30, 2025, totaled $1,126,000, which is a significant increase from $619,000 in the same period of 2024, representing an increase of about 82%[65]. - The provision for credit loss expense for the three months ended September 30, 2025, was $700,000, compared to a provision of $625,000 for the same period in 2024, indicating an increase of approximately 12% year-over-year[65]. Securities and Investments - The total fair value of securities available-for-sale as of September 30, 2025, was $1,618,017, with an amortized cost of $1,848,461, reflecting unrealized losses of $236,243[45]. - The company reported $1,125,013 in total securities with unrealized losses as of September 30, 2025, compared to $1,356,156 as of December 31, 2024, indicating a decrease of about 17%[52]. - The company sold approximately $204.9 million in securities acquired from the Heartland acquisition during the first quarter of 2025, with no gain or loss incurred on the sale[48]. Acquisition and Goodwill - On February 1, 2025, the Company acquired Heartland BancCorp, which had total assets of approximately $1.94 billion, total loans of approximately $1.58 billion, and total deposits of approximately $1.73 billion at the time of acquisition[173]. - The total consideration transferred for the acquisition was $343.109 million, which included $23.102 million in cash and $320.007 million in equity instruments[176]. - The acquisition resulted in the recognition of $196.212 million in goodwill, primarily due to synergies and cost savings from combining operations, and $40.065 million in intangible assets related to core deposits[174]. Non-Interest Income - Non-interest income for the three months ended September 30, 2025, totaled $18.43 million, a 33.0% increase from $13.80 million in the same period of 2024[18]. - Wealth management fees for the three months ended September 30, 2025, were $4,288,000, compared to $3,580,000 in the same period of 2024, indicating a growth of about 20%[114]. - Interchange fee income for the three months ended September 30, 2025, was $5,087 thousand, an increase of 15.9% from $4,390 thousand in the same period of 2024[158]. Cash Flow and Liquidity - The company reported a net cash from operating activities of $116,647,000 for the nine months ended September 30, 2025, compared to $67,071,000 in 2024, marking a 74% increase[31]. - Cash and cash equivalents at the end of the period were $255,648,000, up from $195,555,000 at the end of September 2024, a 31% increase[31]. - Cash dividends paid were $32,454,000 for the nine months ended September 30, 2025, compared to $23,882,000 in 2024, representing a 36% increase[31]. Stock and Shareholder Information - The company reported a total of 37,493,333 shares issued and outstanding as of September 30, 2025, compared to 29,677,093 shares at December 31, 2024[15]. - The company has not repurchased any shares under the stock repurchase plan approved on January 31, 2022, which allows for the repurchase of up to 1,000,000 shares[121]. - The total unvested shares of restricted stock as of September 30, 2025, were 186,982, up from 134,553 as of December 31, 2024, indicating a 39% increase[126].

Core Insights - German American Bancorp (GABC) reported a revenue of $94.15 million for the quarter ended September 2025, reflecting a year-over-year increase of 50.9% [1] - The earnings per share (EPS) for the quarter was $0.92, up from $0.71 in the same quarter last year, indicating a positive growth trend [1] - The reported revenue exceeded the Zacks Consensus Estimate by 3.35%, while the EPS surpassed the consensus estimate by 6.98% [1] Financial Metrics - The efficiency ratio was reported at 49.3%, better than the three-analyst average estimate of 50.9% [4] - The net interest margin stood at 4.1%, compared to the average estimate of 3.9% from three analysts [4] - Net charge-offs to average loans were at 0.1%, matching the average estimate from two analysts [4] - Total average interest-earning assets were $7.54 billion, slightly below the estimated $7.67 billion [4] - Net gains on sales of loans were $1.19 million, exceeding the average estimate of $1.07 million [4] - Total non-interest income reached $18.43 million, surpassing the average estimate of $17.01 million [4] - Net interest income (FTE) was reported at $77 million, above the average estimate of $75.13 million [4] - Service charges on deposit accounts were $3.93 million, slightly above the average estimate of $3.89 million [4] - Overall net interest income was $75.73 million, compared to the average estimate of $74.09 million [4] Stock Performance - Shares of German American Bancorp have returned -1.7% over the past month, while the Zacks S&P 500 composite has increased by 2.5% [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

分组1 - German American Bancorp (GABC) reported quarterly earnings of $0.92 per share, exceeding the Zacks Consensus Estimate of $0.86 per share, and up from $0.71 per share a year ago, representing an earnings surprise of +6.98% [1] - The company posted revenues of $94.15 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 3.35%, compared to year-ago revenues of $62.4 million [2] - Over the last four quarters, German American Bancorp has consistently surpassed consensus EPS and revenue estimates [2] 分组2 - The stock has underperformed the market, losing about 2.3% since the beginning of the year, while the S&P 500 gained 15.5% [3] - The current consensus EPS estimate for the coming quarter is $0.88 on revenues of $92.25 million, and for the current fiscal year, it is $3.38 on revenues of $354.6 million [7] - The Zacks Industry Rank for Banks - Midwest is currently in the top 26% of over 250 Zacks industries, indicating a favorable outlook for the industry [8]

Financial Performance - Record earnings of $35.1 million, or $0.94 per share, for Q3 2025, representing a 12% increase from Q2 2025 and a 32% increase from Q3 2024[1] - Net income for Q3 2025 was $35,074,000, or $0.94 per share, a 12% increase from Q2 2025 and a 32% increase from Q3 2024[24] - Adjusted net income for Q3 2025 was $34,444,000, or $0.92 per share, compared to $32,058,000, or $0.86 per share in Q2 2025, and $21,722,000, or $0.73 per share in Q3 2024[25] - The net income for the three months ended September 30, 2025, was $35,074 thousand, an increase from $31,361 thousand in the previous quarter and $21,048 thousand in the same quarter last year, representing a year-over-year growth of 66.7%[61] - Basic earnings per share for the three months ended September 30, 2025, was $0.94, compared to $0.84 in the previous quarter and $0.71 in the same quarter last year, indicating a year-over-year increase of 32.4%[61] Revenue and Income Growth - Non-interest income rose by $1.7 million, or 10%, driven by a 3% increase in wealth management and a 6% increase in deposit fees[5] - Non-interest income for Q3 2025 totaled $18,429,000, a 10% increase from Q2 2025 and a 34% increase from Q3 2024[34] - Total interest income for the three months ended September 30, 2025, was $108,097 thousand, up from $106,435 thousand in the previous quarter, and $74,653 thousand in the same quarter last year, representing a year-over-year increase of 44.8%[61] - Net interest income for Q3 2025 was $75,725,000, a 4% increase from Q2 2025 and a 56% increase from Q3 2024[28] - Net Interest Income (FTE) for Q3 2025 was $76,998,000, an increase from $49,745,000 in Q3 2024, marking a 54.7% year-over-year growth[75] Asset and Deposit Growth - Total assets reached $8.401 billion, an increase of $121.1 million from Q2 2025 and $2.140 billion from Q3 2024, largely due to the Heartland acquisition[10] - Total deposits increased by 3.4% on an annualized basis, with non-interest bearing demand deposits rising by 9%, representing over 28% of total deposits[4] - Total deposits reached $7,014,502,000 as of September 30, 2025, compared to $6,954,686,000 in Q2 2025 and $5,271,279,000 in Q3 2024[59] Efficiency and Profitability - The efficiency ratio improved to 49.26%, indicating enhanced profitability[6] - The efficiency ratio improved to 49.26% for the three months ended September 30, 2025, compared to 51.25% in the previous quarter and 56.15% in the same quarter last year, indicating enhanced operational efficiency[63] Loan Portfolio and Credit Quality - The loan portfolio increased by $39.3 million, or 3% on an annualized basis, with agricultural loans up by 10% and retail loans up by 7%[11] - Non-performing assets totaled $23.7 million, representing 0.28% of total assets, an increase from $9.7 million or 0.15% a year earlier[17] - The allowance for credit losses was $76.1 million, representing 1.32% of period-end loans, consistent with the previous quarter[14] - The provision for credit losses in Q3 2025 was $700,000, down from $1,200,000 in Q2 2025 and up from $625,000 in Q3 2024[33] Acquisition Impact - The Heartland acquisition added approximately $1.615 billion in deposits and $1.58 billion in loans to the company[9][12] - The Heartland acquisition contributed significantly to the increases in net interest income, non-interest income, and overall performance metrics[29] Expense Management - Non-interest expense for Q3 2025 was $49,700,000, a slight increase of less than 1% from Q2 2025 and a 38% increase from Q3 2024[43] - Total non-interest expense for Q3 2025 was $49,700,000, compared to $49,517,000 in Q2 2025 and $36,126,000 in Q3 2024[46] - Salaries and employee benefits decreased by $1,194,000, or 4%, in Q3 2025 compared to Q2 2025, but increased by $5,726,000, or 29%, compared to Q3 2024[47] - Other operating expenses increased by $854,000, or 12%, in Q3 2025 compared to Q2 2025, and rose by $2,513,000, or 48%, compared to Q3 2024[51] Operational Metrics - The annualized return on average assets for the three months ended September 30, 2025, was 1.68%, up from 1.49% in the previous quarter and 1.35% in the same quarter last year[63] - Average total loans for the three months ended September 30, 2025, were $5,766,875 thousand, compared to $5,678,929 thousand in the previous quarter and $4,052,673 thousand in the same quarter last year, reflecting a year-over-year increase of 42.4%[63] Other Financial Highlights - The tangible book value per share increased to $18.89 in Q3 2025 from $17.40 in Q2 2025, while it was $18.90 in Q3 2024[59] - The company operates 94 banking offices across Indiana, Kentucky, and Ohio, with a focus on expanding its Heartland Bank brand in the Greater Cincinnati area[52] - The company reported a gain on debt extinguishment of $975,000 in Q3 2025, contributing positively to the financial results[73]

Core Insights - German American Bancorp, Inc. reported record earnings for Q3 2025, with net income of $35.1 million or $0.94 per share, marking a 12% increase from Q2 2025 and a 32% increase from Q3 2024 [1][22][23] Financial Performance - The company achieved a return on average assets of 1.68%, return on average equity of 13.0%, and a net interest margin of 4.06% [1][2] - Total deposits increased by 3.4% on an annualized basis, driven by a 9% increase in non-interest bearing demand deposits [4][19] - Non-interest income rose by $1.7 million or 10% compared to Q2 2025, attributed to growth in wealth management and deposit fees [5][30] Loan Portfolio - The overall loan portfolio increased by approximately 3% on an annualized basis, with non-performing loans at 0.41% of total loans [3][10] - Agricultural loans grew by 10% on an annualized basis, while commercial and industrial loans saw a slight decline [10][11] Acquisition Impact - The Heartland acquisition, completed in February 2025, significantly contributed to the company's asset growth, with total assets reaching $8.401 billion, an increase of $2.140 billion compared to Q3 2024 [9][46] - The acquisition added approximately $1.615 billion in deposits and $1.58 billion in loans to the company's balance sheet [17][19] Efficiency and Dividends - The efficiency ratio improved to 49.26%, indicating enhanced profitability [6] - The Board of Directors declared a quarterly cash dividend of $0.29 per share, payable on November 20, 2025 [6]

Core Viewpoint - German American Bancorp (GABC) has shown a downtrend recently, losing 6.8% over the past four weeks, but a hammer chart pattern suggests a potential trend reversal due to increased buying interest [1][2]. Technical Analysis - The hammer chart pattern indicates a possible bottom in the stock price, suggesting that selling pressure may be exhausting [2][5]. - This pattern forms when there is a small candle body with a long lower wick, indicating that the stock opened lower, made a new low, but closed near its opening price, reflecting buying interest [4][5]. - Hammer candles can appear on various timeframes and are used by both short-term and long-term investors [5]. Fundamental Analysis - There has been an upward trend in earnings estimate revisions for GABC, which is a bullish indicator and correlates with near-term stock price movements [7]. - The consensus EPS estimate for the current year has increased by 0.9% over the last 30 days, indicating analysts' optimism about GABC's earnings potential [8]. - GABC holds a Zacks Rank of 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks, which typically outperform the market [9][10].

[PART I. FINANCIAL INFORMATION](index=6&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) Presents the unaudited consolidated financial statements and management's discussion and analysis for German American Bancorp, Inc [Unaudited Financial Statements](index=6&type=section&id=Item%201.%20Unaudited%20Financial%20Statements) Presents the unaudited consolidated financial statements for German American Bancorp, Inc. as of June 30, 2025, reflecting significant growth from the Heartland BancCorp acquisition [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets) Total assets increased by 31.5% to $8.28 billion at June 30, 2025, primarily due to the Heartland BancCorp acquisition Consolidated Balance Sheet Highlights (in $ thousands) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$8,280,142** | **$6,295,910** | | Loans, Net | $5,663,918 | $4,080,466 | | Goodwill | $377,976 | $179,025 | | **Total Liabilities** | **$7,210,638** | **$5,580,843** | | Total Deposits | $6,954,686 | $5,329,075 | | **Total Shareholders' Equity** | **$1,069,504** | **$715,067** | [Consolidated Statements of Income](index=7&type=section&id=Consolidated%20Statements%20of%20Income) Net income for Q2 2025 rose to $31.4 million, driven by a 59% increase in net interest income following the Heartland acquisition Income Statement Highlights - Q2 (in $ thousands, except EPS) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Interest Income | $73,155 | $45,971 | | Provision for Credit Losses | $1,200 | $625 | | Non-interest Income | $16,733 | $18,923 | | Non-interest Expense | $49,517 | $37,674 | | **Net Income** | **$31,361** | **$20,530** | | **Diluted EPS** | **$0.84** | **$0.69** | Income Statement Highlights - Six Months (in $ thousands, except EPS) | Metric | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | | Net Interest Income | $139,727 | $90,965 | | Provision for Credit Losses | $16,500 | $1,525 | | Non-interest Income | $31,573 | $34,745 | | Non-interest Expense | $102,299 | $74,412 | | **Net Income** | **$41,878** | **$39,552** | | **Diluted EPS** | **$1.16** | **$1.33** | [Consolidated Statements of Comprehensive Income (Loss)](index=12&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) Comprehensive income for Q2 2025 was $33.5 million, with H1 2025 at $54.8 million, influenced by net income and securities valuation changes Comprehensive Income (Loss) Summary (in $ thousands) | Period | Net Income | Other Comprehensive Income (Loss) | Comprehensive Income (Loss) | | :--- | :--- | :--- | :--- | | **Q2 2025** | $31,361 | $2,121 | $33,482 | | **Q2 2024** | $20,530 | $19,086 | $39,616 | | **H1 2025** | $41,878 | $12,904 | $54,782 | | **H1 2024** | $39,552 | $(809) | $38,743 | [Consolidated Statements of Changes in Shareholders' Equity](index=14&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Shareholders%27%20Equity) Shareholders' equity increased to $1.07 billion at June 30, 2025, primarily due to the $320.0 million stock issuance for the Heartland acquisition - The acquisition of Heartland BancCorp was the main contributor to the increase in shareholders' equity, with the issuance of **7,742,723 shares** adding **$320.0 million**[26](index=26&type=chunk) - The company declared and paid cash dividends of **$0.29 per share** in both Q1 and Q2 2025, totaling **$21.6 million** for the six-month period[26](index=26&type=chunk) [Consolidated Statements of Cash Flows](index=15&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Cash and cash equivalents increased by $11.4 million in H1 2025, driven by operating and investing activities, offset by financing outflows Cash Flow Summary - Six Months Ended June 30 (in $ thousands) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $64,844 | $42,562 | | Net Cash from Investing Activities | $110,540 | $154,205 | | Net Cash from Financing Activities | $(164,028) | $17,222 | | **Net Change in Cash and Cash Equivalents** | **$11,356** | **$213,989** | [Notes to Consolidated Financial Statements](index=17&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Provides detailed explanations of accounting policies and financial figures, including the insurance business sale, securities, loans, segments, and the Heartland acquisition [Note 3 – Sale of Insurance Assets](index=18&type=section&id=Note%203%20%E2%80%93%20Sale%20of%20Insurance%20Assets) Details the June 1, 2024, sale of German American Insurance, Inc. for $40.0 million cash, resulting in a $36.5 million pre-tax gain Gain on Sale of Insurance Assets (in $ thousands) | Description | Amount | | :--- | :--- | | Gross Purchase Price | $40,000 | | Write-off of Goodwill and Intangibles | $(1,332) | | Working Capital Adjustment | $(345) | | **Net Purchase Price** | **$38,323** | | Transaction Costs | $(1,816) | | **Pre-tax Gain on Sale** | **$36,507** | | **After-tax Gain on Sale** | **$27,476** | [Note 5 – Securities](index=19&type=section&id=Note%205%20%E2%80%93%20Securities) Details the $1.57 billion available-for-sale securities portfolio, which had a net unrealized loss of $262.4 million as of June 30, 2025 - In June/July 2024, the company restructured its securities portfolio, selling **$375.3 million** in securities for a pre-tax loss of approximately **$34.9 million**[46](index=46&type=chunk) - As of June 30, 2025, securities with a fair value of **$1.13 billion** were in a continuous unrealized loss position, totaling **$266.3 million** in losses, primarily due to market interest rate fluctuations[49](index=49&type=chunk) [Note 7 – Loans](index=22&type=section&id=Note%207%20%E2%80%93%20Loans) Total loans grew to $5.75 billion at June 30, 2025, largely due to the Heartland acquisition, with ACL increasing to $75.5 million Loan Portfolio Composition (in $ thousands) | Loan Type | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Commercial and Industrial | $734,551 | $591,785 | | Commercial Real Estate | $3,096,728 | $2,224,872 | | Agricultural | $461,420 | $431,037 | | Residential Mortgage | $798,343 | $357,448 | | Retail (Home Equity, Consumer, etc.) | $574,324 | $448,872 | | **Total Loans** | **$5,748,360** | **$4,133,267** | - The company acquired loans with a fair value of **$1.50 billion** in the Heartland acquisition on February 1, 2025[59](index=59&type=chunk)[60](index=60&type=chunk) - The Allowance for Credit Losses (ACL) increased from **$44.4 million** at year-end 2024 to **$75.5 million** at June 30, 2025, including a **$15.9 million** allowance for acquired PCD loans and a **$16.2 million** 'Day 2' CECL provision related to the Heartland acquisition[64](index=64&type=chunk) [Note 9 – Segment Information](index=34&type=section&id=Note%209%20%E2%80%93%20Segment%20Information) Details the company's two primary segments, Core Banking and Wealth Management Services, following the June 2024 insurance operations sale - The company ceased insurance-related activities after selling the assets of its insurance subsidiary, German American Insurance, Inc. (GAI), on **June 1, 2024**[105](index=105&type=chunk) Segment Profit and Assets - Q2 2025 (in $ thousands) | Segment | Segment Profit (Loss) Before Taxes | Segment Assets | | :--- | :--- | :--- | | Core Banking | $40,408 | $8,252,469 | | Wealth Management Services | $1,500 | $15,829 | | Insurance | $— | $— | | Other / Eliminations | $(2,737) | $11,844 | | **Consolidated Total** | **$39,171** | **$8,280,142** | [Note 16 – Business Combinations](index=50&type=section&id=Note%2016%20%E2%80%93%20Business%20Combinations) Details the February 1, 2025, acquisition of Heartland BancCorp for $343.1 million, adding $1.94 billion in assets and $199.0 million in goodwill Heartland Acquisition Summary (in $ thousands) | Item | Value | | :--- | :--- | | **Fair Value of Total Consideration** | **$343,109** | | Cash Paid | $23,102 | | Equity Instruments Issued | $320,007 | | **Total Identifiable Net Assets Acquired** | **$144,158** | | **Goodwill Recognized** | **$198,951** | - The acquisition is consistent with the company's strategy to build a regional presence in Southern Indiana, Kentucky, and Ohio[176](index=176&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=53&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the significant impact of the Heartland BancCorp acquisition on financial condition and results, highlighting growth, margin expansion, and stable credit quality [Management Overview](index=53&type=section&id=Management%20Overview) The first half of 2025 was marked by the Heartland BancCorp acquisition, contributing to Q2 net income of $31.4 million and adjusted EPS of $0.86 - Completed the acquisition of Heartland BancCorp on **February 1, 2025**, adding **20 banking offices** in Columbus, Ohio, and Greater Cincinnati[188](index=188&type=chunk) Q2 2025 Performance vs. Q2 2024 | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Income (as reported) | $31,361,000 | $20,530,000 | | EPS (as reported) | $0.84 | $0.69 | | Adjusted Net Income (Non-GAAP) | $32,058,000 | $20,351,000 | | Adjusted EPS (Non-GAAP) | $0.86 | $0.69 | [Critical Accounting Policies and Estimates](index=54&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) Identifies critical accounting policies including ACL, securities valuation, income tax, and goodwill, noting a Q1 2025 shift in ACL estimation method - The determination of the Allowance for Credit Losses (ACL) is inherently subjective and requires significant estimates regarding future cash flows, economic conditions, and other factors[197](index=197&type=chunk)[198](index=198&type=chunk) - On **March 31, 2025**, the company changed its ACL estimation method to a discounted cash flow model to better evaluate multiple economic scenarios[206](index=206&type=chunk) - Goodwill is not amortized but is tested for impairment annually on **December 31**, with no impairment indicated at the last testing date[211](index=211&type=chunk) [Results of Operations](index=56&type=section&id=Results%20of%20Operations) Operating results for Q2 and H1 2025 were significantly boosted by the Heartland acquisition, driving net interest income growth and margin expansion Net Interest Margin (Tax-Equivalent) | Period | Net Interest Margin | | :--- | :--- | | Q2 2025 | 3.92% | | Q2 2024 | 3.34% | | H1 2025 | 3.94% | | H1 2024 | 3.34% | - Accretion of discounts on acquired loans contributed **18 basis points** to the net interest margin in Q2 2025[219](index=219&type=chunk) - Q2 2025 non-interest expense increased **31% YoY** to **$49.5 million**, primarily driven by operating costs from the Heartland acquisition[241](index=241&type=chunk) [Financial Condition](index=65&type=section&id=Financial%20Condition) Total assets grew to $8.28 billion, loans to $5.75 billion, and deposits to $6.95 billion, primarily due to the Heartland acquisition - Total assets increased to **$8.28 billion** at June 30, 2025, largely due to the Heartland acquisition[259](index=259&type=chunk) - Excluding acquired loans, organic loan growth was approximately **5%** on an annualized basis in H1 2025[261](index=261&type=chunk) - Non-performing assets rose to **$25.1 million** (**0.30% of assets**) from **$11.1 million** (**0.18% of assets**), with the increase largely attributable to the Heartland acquisition, including a single adversely classified commercial relationship[270](index=270&type=chunk)[271](index=271&type=chunk) [Capital Resources and Liquidity](index=68&type=section&id=Capital%20Resources%20and%20Liquidity) The company maintains a strong capital and liquidity position, with shareholders' equity at $1.07 billion and regulatory capital ratios exceeding minimums Regulatory Capital Ratios (Consolidated) | Ratio | 6/30/2025 | Minimum for Capital Adequacy | | :--- | :--- | :--- | | Total Capital (to RWA) | 15.21% | 8.00% | | Tier 1 Capital (to RWA) | 13.53% | 6.00% | | Common Equity Tier 1 (to RWA) | 13.00% | 4.50% | | Tier 1 Capital (to Average Assets) | 10.93% | 4.00% | - The company plans to redeem the **$24.3 million** of outstanding Heartland Notes on **September 15, 2025**, funded from cash on hand[280](index=280&type=chunk)[288](index=288&type=chunk) - The company has not repurchased any shares under its **1.0 million share** repurchase plan[277](index=277&type=chunk) [Use of Non-GAAP Financial Measures](index=70&type=section&id=Use%20of%20Non-GAAP%20Financial%20Measures) Provides reconciliations of GAAP to non-GAAP financial measures, excluding specific non-recurring items to assess core operational performance Non-GAAP Reconciliation - Net Income and EPS (in $ thousands) | Metric | Q2 2025 | H1 2025 | | :--- | :--- | :--- | | Net Income, as reported | $31,361 | $41,878 | | Adjustments (Merger costs, CECL Day 2) | $697 | $17,467 | | **Adjusted Net Income** | **$32,058** | **$59,345** | | EPS, as reported | $0.84 | $1.16 | | **Adjusted EPS** | **$0.86** | **$1.64** | [Quantitative and Qualitative Disclosures About Market Risk](index=73&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Discusses primary market risks, liquidity and interest rate risk, with net interest income projected to increase by 0.70% in a +200 bps rate shock Interest Rate Sensitivity of Net Interest Income (Next 12 Months) | Rate Change Scenario | % Change in Net Interest Income | | :--- | :--- | | +200 bps | +0.70% | | +100 bps | +0.34% | | -100 bps | -1.11% | | -200 bps | -3.33% | [Controls and Procedures](index=74&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting - Management concluded that disclosure controls and procedures were effective as of **June 30, 2025**[310](index=310&type=chunk) - No material changes in internal control over financial reporting occurred during the second fiscal quarter of **2025**[311](index=311&type=chunk) [PART II. OTHER INFORMATION](index=75&type=section&id=PART%20II.%20OTHER%20INFORMATION) Presents other required information, including legal proceedings, risk factors, equity sales, defaults, and exhibits [Legal Proceedings](index=75&type=section&id=Item%201.%20Legal%20Proceedings) Reports no pending legal proceedings beyond routine litigation incidental to business operations - There are no pending legal proceedings, other than routine litigation incidental to the business[312](index=312&type=chunk) [Risk Factors](index=75&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors have occurred since the 2024 Annual Report on Form 10-K - No material changes to risk factors have occurred since the **2024 Annual Report on Form 10-K**[313](index=313&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=75&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company did not repurchase any equity securities during the quarter, with 1.0 million shares remaining available under the plan - The company has a board-approved plan to repurchase up to **1.0 million shares** of its common stock, but no shares were repurchased during the second quarter of **2025**[319](index=319&type=chunk) [Defaults Upon Senior Securities](index=75&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) Reports no defaults upon senior securities - None[320](index=320&type=chunk) [Mine Safety Disclosures](index=75&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[321](index=321&type=chunk) [Other Information](index=75&type=section&id=Item%205.%20Other%20Information) Reports no undisclosed Form 8-K information or Rule 10b5-1 trading arrangement adoptions or terminations by directors or officers - During Q2 2025, no director or officer of the Company adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement[326](index=326&type=chunk) [Exhibits](index=77&type=section&id=Item%206.%20Exhibits) Lists all exhibits filed with the Form 10-Q, including Sarbanes-Oxley certifications and XBRL data files - The exhibits include the Agreement and Plan of Reorganization for the Heartland acquisition (incorporated by reference), articles of incorporation, bylaws, and Sarbanes-Oxley certifications[328](index=328&type=chunk)

Company Overview - German American Bancorp (GABC) is located in Jasper and operates in the Finance sector, with a year-to-date share price change of -3.43% [3] - The company currently pays a dividend of $0.29 per share, resulting in a dividend yield of 2.99%, which is slightly below the Banks - Midwest industry's yield of 3.07% but significantly higher than the S&P 500's yield of 1.46% [3] Dividend Performance - The current annualized dividend of GABC is $1.16, reflecting a year-over-year increase of 7.4% [4] - Over the past five years, GABC has raised its dividend five times, achieving an average annual increase of 8.99% [4] - The company's current payout ratio stands at 39%, indicating that it distributes 39% of its trailing 12-month earnings per share as dividends [4] Earnings Growth Expectations - For the fiscal year 2025, GABC anticipates solid earnings growth, with the Zacks Consensus Estimate projecting earnings of $3.36 per share, which corresponds to a year-over-year growth rate of 18.73% [5] Investment Appeal - GABC is characterized as an attractive dividend play and a compelling investment opportunity, currently holding a Zacks Rank of 2 (Buy) [6]

Core Insights - German American Bancorp (GABC) reported a revenue of $89.89 million for the quarter ended June 2025, marking a 38.5% increase year-over-year [1] - The earnings per share (EPS) for the quarter was $0.86, up from $0.69 in the same quarter last year, exceeding the consensus EPS estimate of $0.83 by 3.61% [1] Financial Performance Metrics - The efficiency ratio was reported at 51.3%, better than the average estimate of 52.4% from three analysts [4] - The net interest margin stood at 3.9%, matching the average estimate from three analysts [4] - Net charge-offs to average loans were 0.1%, consistent with the average estimate from two analysts [4] - Total average interest-earning assets were $7.61 billion, slightly below the average estimate of $7.67 billion from two analysts [4] - Net gains on sales of loans were $1 million, compared to the estimated $1.81 million from three analysts [4] - Total non-interest income was $16.73 million, exceeding the average estimate of $16.36 million from three analysts [4] - Net interest income (FTE) was reported at $74.43 million, slightly below the average estimate of $74.81 million from two analysts [4] - Service charges on deposit accounts were $3.71 million, below the average estimate of $3.85 million from two analysts [4] - Net interest income was $73.16 million, compared to the average estimate of $73.49 million from two analysts [4] Stock Performance - Shares of German American Bancorp have returned +2.1% over the past month, while the Zacks S&P 500 composite increased by +4.9% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Core Viewpoint - German American Bancorp (GABC) reported quarterly earnings of $0.86 per share, exceeding the Zacks Consensus Estimate of $0.83 per share, and showing an increase from $0.69 per share a year ago, indicating a positive earnings surprise of +3.61% [1] Financial Performance - The company achieved revenues of $89.89 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 0.38%, and up from $64.89 million year-over-year [2] - Over the last four quarters, German American Bancorp has consistently surpassed consensus EPS estimates four times and topped consensus revenue estimates three times [2] Stock Performance and Outlook - Since the beginning of the year, German American Bancorp shares have decreased by approximately 0.8%, contrasting with the S&P 500's gain of 8.6% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] Earnings Estimate Revisions - The trend for earnings estimate revisions for German American Bancorp was mixed prior to the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] - The current consensus EPS estimate for the upcoming quarter is $0.86 on revenues of $90.2 million, and for the current fiscal year, it is $3.35 on revenues of $352.35 million [7] Industry Context - The Banks - Midwest industry, to which German American Bancorp belongs, is currently ranked in the top 20% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8]