Credit Losses and Provisions - The allowance for credit losses on loans decreased by 12.2millionduringtheyearendedDecember31,2024,primarilydueto49.4 million in net charge-offs[129]. - The provision for credit losses on loans recorded in 2024 was 37.2million,resultinginanetprovisionexpenseof35.7 million after a reserve release of 1.5million[129].−Netcharge−offsfor2024amountedto49.4 million, with two commercial relationships accounting for 42.7millionofthesecharge−offs[129].−Theratioofnetcharge−offstoaverageloansoutstandingfor2024was0.39192.8 million, down from 204.9millionin2023[129].−Theallowanceforcreditlossesonloanswasreportedat192.8 million as of December 31, 2024, reflecting management's estimates of expected future losses[334]. - The total allowance for credit losses (ACL) on loans is adjusted quarterly, reflecting the expected credit losses based on historical data and economic forecasts[465]. - The net provision expense for credit losses on loans for the year ended December 31, 2024, was 35.7million,afterrecordingaprovisionof37.2 million offset by a release in reserve of 1.5million[476].−ThetotalACL−LoansbalanceasofDecember31,2024,was192.757 million, down from 204.934millionasofDecember31,2023[477].−TheCorporation′sloancommitmentstoextendcreditamountedto5,006.085 million as of December 31, 2024, compared to 5,025.790millionin2023[481].FinancialPerformance−TotalInterestIncomefor2024reached948,006, an increase of 6.4% from 893,886in2023[340].−NetInterestIncomeafterProvisionforCreditLossesdecreasedto485,414 in 2024, down from 541,900in2023,reflectingadeclineof10.4125,580 in 2024, up 18.9% from 105,602in2023[340].−TotalNoninterestExpensesdecreasedto379,266 in 2024, a reduction of 2.3% compared to 388,270in2023[340].−NetIncomeavailabletoCommonStockholdersfor2024was199,527, down 10.1% from 221,911in2023[340].−BasicNetIncomeperSharefor2024was3.42, a decrease of 8.6% from 3.74in2023[340].−ComprehensiveIncomefor2024was188,687, a decline of 34.3% from 286,967in2023[341].−ThenetincomefortheyearendedDecember31,2024,is201,402,000, a decrease from 223,786,000in2023[343].−ThetotalcomprehensiveincomefortheyearendedDecember31,2024,is188,685,000, compared to a comprehensive income of 239,151,000in2023[343].LoansandLoanPortfolio−Thecompany′snetloansincreasedto12,661,602,000 in 2024 from 12,281,093,000in2023,showinggrowthintheloanportfolio[338].−Theloanportfolioreached12,854,359 million as of December 31, 2024, up from 12,486,027millionin2023,indicatinganincreaseofabout2.94,114,292 million in 2024 from 3,670,948millionin2023,markingagrowthofapproximately12.112,854,359, an increase from 1,733,843,representingagrowthofabout6411,693,245, an increase from 539,311inthepreviousyear,representingagrowthofapproximately2132,374,729, compared to 417,417inthepreviousyear,reflectingagrowthofabout469659,811 from 4,354,markingagrowthofapproximately15,11654,243, a decrease from 40,529inthepreviousperiod[447].DepositsandBorrowings−Thetotalshort−termborrowingsasofDecember31,2024,were338.3 million, an increase from 218.5millionin2023[137].−Totaldepositsdecreasedto14,521,626,000 in 2024 from 14,821,453,000in2023,indicatingadeclineincustomerdeposits[338].−TheCorporation′stotaldepositsdecreasedby299.8 million from December 31, 2023, primarily due to the sale of Illinois branch deposits amounting to 267.4million,resultingintotaldepositsof14.5 billion as of December 31, 2024[498]. - Total borrowings increased from 1.03billionin2023to1.16 billion in 2024, with Federal Home Loan Bank advances rising from 712.9millionto822.6 million[500]. Asset Management and Investments - The fair value of assets acquired in previous acquisitions was 2,510,576,withliabilitiesassumedtotaling2,168,863[347]. - The amortized cost of investment securities available for sale was 1.624billionasofDecember31,2024,withafairvalueof1.386 billion[423]. - The total held-to-maturity investment securities amounted to 2.074billion,withafairvalueof1.723 billion as of December 31, 2024[424]. - The total investment securities available for sale reported at less than historical cost was 1,353.744millionasofDecember31,2024,withgrossunrealizedlossesof238.853 million, representing 97.6% of the Corporation's investments available for sale in an unrealized loss position[435]. - The fair value of investment securities available for sale at December 31, 2024 was 1,353.744million,downfromahistoricalcostof1,592.597 million[435]. Shareholder and Equity Information - The total stockholders' equity rose to 2,304,983,000in2024,comparedto2,247,713,000 in 2023, reflecting an increase in retained earnings[338]. - Cash Dividends Paid to Common Stockholders increased to 1.39in2024,upfrom1.34 in 2023[340]. - The company repurchased 1,648,466 shares of common stock in 2024, resulting in a total cost of 56,168,000[343].−ThetotalnumberofcommonsharesoutstandingasofDecember31,2024,is57,974,535,adecreasefrom59,424,122sharesin2023[343].−Theaccumulatedothercomprehensiveincome(loss)asofDecember31,2024,is(188,685,000), compared to $(175,970,000) in 2023[343]. Risk Management and Credit Quality - Nonperforming loans and credit quality indicators are actively monitored, with management tracking trends in criticized commercial loans and net charge-offs[444]. - The corporation's risk grading system includes categories from Pass to Loss, with all large commercial credit grades reviewed at least annually[445]. - The Corporation maintained a strong focus on credit quality, with no allowance for credit losses recorded on investment securities available for sale due to unrealized losses being attributed to interest rate changes[358]. - The Corporation's investment securities portfolio is monitored quarterly for credit quality through the use of credit ratings[429]. Accounting and Regulatory Compliance - The Corporation adopted new accounting standards in 2024, including ASU No. 2023-02 for tax credit structures, which did not significantly impact financial statements[395]. - The Corporation is assessing the impact of new accounting pronouncements, including ASU No. 2023-09 on income tax disclosures, expected to be effective after December 15, 2024[400]. - The Corporation's income tax expense includes current year tax due and changes in deferred tax assets and liabilities, with no uncertain tax positions identified[390].
First Merchants (FRME)2025-02-24 17:07