FIRST MERCHANTS CORP - FORM 8-K - EX-99.1 - FIRST MERCHANTS CORP-3RD QUARTER 2015 PRESS RELEASE

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8-K - FIRST MERCHANTS CORP-3RD QUARTER 2015 EARNINGS RELEASE - FIRST MERCHANTS CORP	f8k3q2015earningsrelease.htm

N / E / W / S R / E / L / E / A / S / E

October 22, 2015

FOR IMMEDIATE RELEASE

For more information, contact:

David L. Ortega, First Vice President/Director of Investor Relations

765-378-8937

http://www.firstmerchants.com

SOURCE: First Merchants Corporation, Muncie, Indiana

FIRST MERCHANTS CORPORATION ANNOUNCES THIRD QUARTER 2015 EARNINGS PER SHARE

First Merchants Corporation (NASDAQ - FRME) has reported third quarter 2015 net income of $17.1 million, compared to $16.1 million during the third quarter of 2014. Earnings per share for the period totaled $.45 per share equaling the third quarter of 2014. Year-to-date net income totaled $51.2 million, compared to $44.9 million during the same period in 2014. Earnings per share for the nine months ended September 30, 2015 totaled $1.35 per share, an increase of $.11 per share or 8.9 percent over the same period in 2014.

Total assets reached $6.2 billion as of quarter-end and loans totaled $4.3 billion. The Corporation’s loan portfolio increased, by $549 million, during the past twelve months. Of the increase, $293 million, or 7.8 percent, was the result of organic growth, $145 million resulted from the acquisition of Community Bank of Noblesville in November of 2014 and $111 million resulted from the acquisition of Cooper State Bank in Columbus, Ohio in April of 2015.

Michael C. Rechin, President and Chief Executive Officer, stated, “The third quarter of 2015 was another successful quarter including strong performance in organically growing loans, deposits, fees and clients. Our loan volume coupled with a modestly increased margin produced a 3 percent quarterly lift in net interest income. Asset quality improvement continues as acquired loan portfolios and our own are performing in line with our expectations. During the quarter we were also able to complete the enhancement of our on-line banking platform bringing new functionality to our consumer and commercial clients.”

Net-interest income totaled $50.3 million for the quarter as reported net-interest margin, totaling 3.85 percent, increased by 4 basis points over the second quarter of 2015. Yields on earning assets totaled 4.30 percent and the cost of supporting liabilities totaled .45 percent. When adjusted for fair value accretion, core net-interest margin totaled 3.71 percent for the quarter, 6 basis points more than the second quarter of 2015 total of 3.65 percent. When compared to the third quarter of 2014, core net-interest margin is unchanged.

Year-to-date non-interest income totaled $57.8 million compared to $50 million in 2014. Of the increase, our gain on the sale of our insurance subsidiary, First Merchants Insurance Group, totaled $8.3 million. Non-interest income totaled $16.9 million for the quarter, a $1.5 million decrease from the third quarter of 2014 total of $18.4 million. The absence of insurance commission income related to the second quarter sale totaled $1.7 million.

Year-to-date non-interest expense totaled $131.2 million compared to $126.9 million in 2014. The increase of $4.3 million includes non-recurring acquisition and divestiture expenses totaling $3.7 million and on-line banking implementation expenses of $578,000. Non-interest expense totaled $43.6 million for the quarter, an increase of $1 million over the third quarter of 2014. Of the increase, $676,000 is related to non-recurring acquisition expenses.

The Corporation did not record any provision expense in the third quarter due to net recoveries for the period of $311,000 and improvements in non-performing loans now totaling $36.4 million. Year-to-date provision expense totaled just $417,000 versus $1.5 million of net charge-offs. The allowance for loan losses totaled $62.9 million, or 1.45 percent of total loans and 1.70 percent of non-purchased loans.

As of September 30, 2015, the Corporation’s total risk-based capital equaled 14.85 percent, common equity tier 1 risk-based capital equaled 11.31 percent, and tangible common equity ratio totaled 9.25 percent.

CONFERENCE CALL

First Merchants Corporation will conduct a third quarter earnings conference call and web cast at 2:30 p.m. (ET) on Thursday, October 22, 2015.

To participate, dial (Toll Free) 877-507-0578 and reference First Merchants Corporation's third quarter earnings release. International callers please call +1 412-317-1073. A replay of the call will be available until November 22, 2015. To access a replay of the call, US participants should dial (Toll Free) 877-344-7529 or for International participants, dial +1 412-317-0088. The replay passcode is 10072689.

In order to view the web cast and presentation slides, please go to http://services.choruscall.com/links/frme151022.html during the time of the call. A replay of the web cast will be available until October 22, 2016.

During the call, Forward-Looking Statements about the relative business outlook may be made. These Forward-Looking Statements and all other statements made during the call that do not concern historical facts, are subject to risks and uncertainties that may materially affect actual results.

Specific Forward-Looking Statements include, but are not limited to, any indications regarding the Financial Services industry, the economy and future growth of the balance sheet or income statement.

Detailed financial results are reported on the attached pages.

About First Merchants Corporation

First Merchants Corporation is a financial holding company headquartered in Muncie, Indiana. The Corporation is comprised of First Merchants Bank, N.A., which also operates as Lafayette Bank & Trust, Commerce National Bank, and First Merchants Trust Company as divisions of First Merchants Bank, N.A.

First Merchants Corporation’s common stock is traded on the NASDAQ Global Select Market System under the symbol FRME. Quotations are carried in daily newspapers and can be found on the company’s Internet web page (http://www.firstmerchants.com).

FIRST MERCHANTS and the Shield Logo are federally registered trademarks of First Merchants Corporation.

* * * *



CONSOLIDATED BALANCE SHEETS
(Dollars In Thousands)	September 30,
	2015			2014
ASSETS
Cash and cash equivalents	$	84,677		$	74,237
Interest-bearing time deposits	27,111			24,171
Investment securities	1,208,793			1,189,814
Loans held for sale	1,943			6,423
Loans	4,321,715			3,772,467
Less: Allowance for loan losses	(62,861		)	(65,596		)
Net loans	4,258,854			3,706,871
Premises and equipment	83,457			74,105
Federal Reserve and Federal Home Loan Bank stock	34,498			43,127
Interest receivable	22,048			19,455
Core deposit intangibles and goodwill	219,503			200,991
Cash surrender value of life insurance	171,530			165,423
Other real estate owned	14,809			14,540
Tax asset, deferred and receivable	38,339			41,131
Other assets	24,235			31,095
TOTAL ASSETS	$	6,189,797		$	5,591,383
LIABILITIES
Deposits:
Noninterest-bearing	$	1,110,905		$	939,540
Interest-bearing	3,703,684			3,370,583
Total Deposits	4,814,589			4,310,123
Borrowings:
Federal funds purchased	52,896			61,428
Securities sold under repurchase agreements	153,822			117,892
Federal Home Loan Bank advances	237,856			255,423
Subordinated debentures and term loans	121,936			126,874
Total Borrowings	566,510			561,617
Interest payable	3,710			3,819
Other liabilities	38,004			31,271
Total Liabilities	5,422,813			4,906,830
STOCKHOLDERS' EQUITY
Cumulative Preferred Stock, $1,000 par value, $1,000 liquidation value:
Authorized -- 600 shares
Issued and outstanding - 125 shares	125			125
Common Stock, $.125 stated value:
Authorized -- 50,000,000 shares
Issued and outstanding - 37,873,921 and 36,074,246 shares	4,734			4,509
Additional paid-in capital	433,577			395,582
Retained earnings	332,162			280,187
Accumulated other comprehensive loss	(3,614		)	4,150
Total Stockholders' Equity	766,984			684,553
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	6,189,797		$	5,591,383



CONSOLIDATED STATEMENTS OF INCOME	Three Months Ended				Nine Months Ended
(Dollars In Thousands, Except Per Share Amounts)	September 30,				September 30,
	2015		2014		2015		2014
INTEREST INCOME
Loans receivable:
Taxable	$	46,037	$	43,981	$	134,908	$	128,329
Tax-exempt	1,190		61		2,174		180
Investment securities:
Taxable	4,374		5,046		13,522		14,902
Tax-exempt	4,412		3,683		12,478		10,691
Deposits with financial institutions	25		18		93		76
Federal Reserve and Federal Home Loan Bank stock	500		501		1,509		1,648
Total Interest Income	56,538		53,290		164,684		155,826
INTEREST EXPENSE
Deposits	3,715		2,853		10,917		8,276
Federal funds purchased	27		102		69		174
Securities sold under repurchase agreements	96		74		264		457
Federal Home Loan Bank advances	711		734		2,108		2,092
Subordinated debentures and term loans	1,666		1,661		4,996		4,950
Total Interest Expense	6,215		5,424		18,354		15,949
NET INTEREST INCOME	50,323		47,866		146,330		139,877
Provision for loan losses			1,600		417		1,600
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES	50,323		46,266		145,913		138,277
OTHER INCOME
Service charges on deposit accounts	4,445		4,119		12,083		11,768
Fiduciary activities	2,242		2,152		7,058		6,724
Other customer fees	4,156		3,991		12,425		11,773
Commission income	4		1,723		4,147		5,877
Earnings on cash surrender value of life insurance	710		1,524		2,097		2,925
Net gains and fees on sales of loans	1,905		1,458		5,175		3,340
Net realized gains (losses) on sales of available for sale securities	1,115		910		2,047		2,335
Gain on sale of insurance subsidiary					8,265
Other income	2,322		2,535		4,467		5,283
Total Other Income	16,899		18,412		57,764		50,025
OTHER EXPENSES
Salaries and employee benefits	25,137		24,173		76,112		72,904
Net occupancy	3,726		3,401		11,019		10,543
Equipment	2,698		2,187		8,104		7,022
Marketing	847		1,070		2,578		2,628
Outside data processing fees	1,992		1,853		5,477		5,723
Printing and office supplies	343		350		1,010		1,201
Core deposit amortization	693		592		2,143		1,776
FDIC assessments	958		920		2,716		2,843
Other real estate owned and foreclosure expenses	1,835		2,618		4,436		6,988
Professional and other outside services	1,686		1,573		6,311		4,483
Other expenses	3,683		3,839		11,317		10,804
Total Other Expenses	43,598		42,576		131,223		126,915
INCOME BEFORE INCOME TAX	23,624		22,102		72,454		61,387
Income tax expense	6,557		5,980		21,247		16,485
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS	$	17,067	$	16,122	$	51,207	$	44,902
Per Share Data:
Basic Net Income Available to Common Stockholders	$	0.46	$	0.45	$	1.36	$	1.25
Diluted Net Income Available to Common Stockholders	$	0.45	$	0.45	$	1.35	$	1.24
Cash Dividends Paid	$	0.11	$	0.08	$	0.30	$	0.21
Average Diluted Shares Outstanding (in thousands)	38,118		36,329		38,054		36,295



FINANCIAL HIGHLIGHTS
(Dollars in thousands)	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2015			2014			2015			2014
NET CHARGE OFF'S	$	(311	)	$	4,371		$	1,520		$	3,874

AVERAGE BALANCES:
Total Assets	$	6,153,949		$	5,578,704		$	6,013,053		$	5,500,281
Total Loans	4,273,475			3,753,690			4,121,949			3,683,936
Total Earning Assets	5,538,202			5,010,877			5,392,975			4,921,105
Total Deposits	4,824,683			4,288,788			4,743,106			4,290,157
Total Stockholders' Equity	759,144			679,306			746,702			662,408

FINANCIAL RATIOS:
Return on Average Assets	1.11		%	1.16		%	1.14		%	1.09		%
Return on Average Stockholders' Equity	8.99			9.49			9.14			9.04
Return on Average Common Stockholders' Equity	8.99			9.50			9.15			9.04
Average Earning Assets to Average Assets	89.99			89.82			89.69			89.47
Allowance for Loan Losses as % of Total Loans	1.45			1.74			1.45			1.74
Net Charge Off's as % of Average Loans (Annualized)	(0.03		)	0.47			0.05			0.14
Average Stockholders' Equity to Average Assets	12.34			12.18			12.42			12.04
Tax Equivalent Yield on Earning Assets	4.30			4.41			4.27			4.38
Cost of Supporting Liabilities	0.45			0.43			0.45			0.43
Net Interest Margin (FTE) on Earning Assets	3.85			3.98			3.82			3.95
Tangible Book Value Per Share	$	14.59		$	13.53		$	14.59		$	13.53



NON-PERFORMING ASSETS
(Dollars In Thousands)	September 30,			June 30,			March 31,			December 31,			September 30,
	2015			2015			2015			2014			2014
Non-Accrual Loans	$	32,597		$	37,713		$	44,321		$	48,789		$	49,104
Renegotiated Loans	3,823			885			1,326			1,992			1,171
Non-Performing Loans (NPL)	36,420			38,598			45,647			50,781			50,275
Other Real Estate Owned	14,809			19,242			19,073			19,293			14,540
Non-Performing Assets (NPA)	51,229			57,840			64,720			70,074			64,815
90+ Days Delinquent	1,947			632			1,655			4,663			831
NPAs & 90 Day Delinquent	$	53,176		$	58,472		$	66,375		$	74,737		$	65,646

Loan Loss Reserve	$	62,861		$	62,550		$	62,801		$	63,964		$	65,596
Quarterly Net Charge-off's	(311		)	668			1,163			2,592			4,371
NPAs / Actual Assets %	0.83		%	0.94		%	1.10		%	1.20		%	1.16		%
NPAs & 90 Day / Actual Assets %	0.86		%	0.95		%	1.13		%	1.28		%	1.17		%
NPAs / Actual Loans and OREO %	1.18		%	1.36		%	1.62		%	1.77		%	1.71		%
Loan Loss Reserves / Actual Loans (%)	1.45		%	1.47		%	1.58		%	1.63		%	1.74		%
Net Charge Off's as % of Average Loans (Annualized)	(0.03		)%	0.06		%	0.12		%	0.27		%	0.47		%



CONSOLIDATED BALANCE SHEETS
(Dollars In Thousands)	September 30,			June 30,			March 31,			December 31,			September 30,
	2015			2015			2015			2014			2014
ASSETS
Cash and cash equivalents	$	84,677		$	105,928		$	89,243		$	118,616		$	74,237
Interest-bearing time deposits	27,111			26,669			83,228			47,520			24,171
Investment securities	1,208,793			1,212,516			1,189,473			1,180,631			1,189,814
Loans held for sale	1,943			8,295			6,392			7,235			6,423
Loans	4,321,715			4,238,205			3,965,532			3,924,865			3,772,467
Less: Allowance for loan losses	(62,861		)	(62,550		)	(62,801		)	(63,964		)	(65,596		)
Net loans	4,258,854			4,175,655			3,902,731			3,860,901			3,706,871
Premises and equipment	83,457			84,841			77,468			77,691			74,105
Federal Reserve and Federal Home Loan Bank stock	34,498			34,630			41,273			41,353			43,127
Interest receivable	22,048			19,880			19,557			19,984			19,455
Core deposit intangibles and goodwill	219,503			220,196			218,034			218,755			200,991
Cash surrender value of life insurance	171,530			170,813			170,172			169,424			165,423
Other real estate owned	14,809			19,242			19,073			19,293			14,540
Tax asset, deferred and receivable	38,339			39,622			38,695			41,960			41,131
Other assets	24,235			22,021			22,182			20,764			31,095
TOTAL ASSETS	$	6,189,797		$	6,140,308		$	5,877,521		$	5,824,127		$	5,591,383
LIABILITIES
Deposits:
Noninterest-bearing	$	1,110,905		$	1,122,688		$	1,100,397		$	1,070,859		$	939,540
Interest-bearing	3,703,684			3,666,889			3,547,678			3,569,835			3,370,583
Total Deposits	4,814,589			4,789,577			4,648,075			4,640,694			4,310,123
Borrowings:
Federal funds purchased	52,896			40,748						15,381			61,428
Securities sold under repurchase agreements	153,822			137,240			134,023			124,539			117,892
Federal Home Loan Bank advances	237,856			247,687			166,326			145,264			255,423
Subordinated debentures and term loans	121,936			126,882			126,875			126,810			126,874
Total Borrowings	566,510			552,557			427,224			411,994			561,617
Interest payable	3,710			3,211			3,685			3,201			3,819
Other liabilities	38,004			45,008			58,879			41,411			31,271
Total Liabilities	5,422,813			5,390,353			5,137,863			5,097,300			4,906,830
STOCKHOLDERS' EQUITY
Cumulative Preferred Stock, $1,000 par value, $1,000 liquidation value:
Authorized -- 600 shares
Issued and outstanding	125			125			125			125			125
Common Stock, $.125 stated value:
Authorized -- 50,000,000 shares
Issued and outstanding	4,734			4,728			4,723			4,709			4,509
Additional paid-in capital	433,577			432,294			431,199			431,220			395,582
Retained earnings	332,162			319,298			305,526			292,403			280,187
Accumulated other comprehensive income (loss)	(3,614		)	(6,490		)	(1,915		)	(1,630		)	4,150
Total Stockholders' Equity	766,984			749,955			739,658			726,827			684,553
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	6,189,797		$	6,140,308		$	5,877,521		$	5,824,127		$	5,591,383



CONSOLIDATED STATEMENTS OF INCOME
(Dollars In Thousands, Except Per Share Amounts)	September 30,			June 30,			March 31,			December 31,			September 30,
	2015			2015			2015			2014			2014
INTEREST INCOME
Loans receivable:
Taxable	$	46,037		$	45,320		$	43,551		$	43,710		$	43,981
Tax-exempt	1,190			736			248			147			61
Investment securities:
Taxable	4,374			4,425			4,723			4,980			5,046
Tax-exempt	4,412			4,231			3,835			3,692			3,683
Deposits with financial institutions	25			31			37			48			18
Federal Reserve and Federal Home Loan Bank stock	500			459			550			476			501
Total Interest Income	56,538			55,202			52,944			53,053			53,290
INTEREST EXPENSE
Deposits	3,715			3,686			3,516			3,402			2,853
Federal funds purchased	27			19			23			3			102
Securities sold under repurchase agreements	96			90			78			72			74
Federal Home Loan Bank advances	711			706			691			750			734
Subordinated debentures and term loans	1,666			1,670			1,660			1,666			1,661
Total Interest Expense	6,215			6,171			5,968			5,893			5,424
NET INTEREST INCOME	50,323			49,031			46,976			47,160			47,866
Provision for loan losses				417						960			1,600
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES	50,323			48,614			46,976			46,200			46,266
OTHER INCOME
Service charges on deposit accounts	4,445			4,090			3,548			3,979			4,119
Fiduciary activities	2,242			2,309			2,507			2,242			2,152
Other customer fees	4,156			4,602			3,667			3,926			3,991
Commission income	4			1,815			2,328			1,534			1,723
Earnings on cash surrender value of life insurance	710			640			747			734			1,524
Net gains and fees on sales of loans	1,905			1,781			1,489			1,559			1,458
Net realized gains (losses) on sales of available for sale securities	1,115			(93		)	1,025			1,246			910
Gain on sale of insurance subsidiary				8,265
Other income	2,322			1,224			921			1,155			2,535
Total Other Income	16,899			24,633			16,232			16,375			18,412
OTHER EXPENSES
Salaries and employee benefits	25,137			26,434			24,541			23,595			24,173
Net occupancy	3,726			3,503			3,790			3,288			3,401
Equipment	2,698			2,840			2,566			2,315			2,187
Marketing	847			951			780			836			1,070
Outside data processing fees	1,992			1,768			1,717			1,592			1,853
Printing and office supplies	343			303			364			364			350
Core deposit amortization	693			729			721			669			592
FDIC assessments	958			895			863			895			920
Other real estate owned and foreclosure expenses	1,835			1,372			1,229			1,055			2,618
Professional and other outside services	1,686			3,134			1,491			3,633			1,573
Other expenses	3,683			4,494			3,140			3,435			3,839
Total Other Expenses	43,598			46,423			41,202			41,677			42,576
INCOME BEFORE INCOME TAX	23,624			26,824			22,006			20,898			22,102
Income tax expense	6,557			8,856			5,834			5,638			5,980
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS	$	17,067		$	17,968		$	16,172		$	15,260		$	16,122

Per Share Data:
Basic Net Income Available to Common Stockholders	$	0.46		$	0.47		$	0.43		$	0.41		$	0.45
Diluted Net Income Available to Common Stockholders	$	0.45		$	0.47		$	0.43		$	0.41		$	0.45
Cash Dividends Paid	$	0.11		$	0.11		$	0.08		$	0.08		$	0.08
Average Diluted Shares Outstanding (in thousands)	38,118			38,043			38,000			37,323			36,329
FINANCIAL RATIOS:
Return on Average Assets	1.11		%	1.19		%	1.11		%	1.06		%	1.16		%
Return on Average Stockholders' Equity	8.99			9.63			8.81			8.55			9.49
Return on Average Common Stockholders' Equity	8.99			9.63			8.81			8.56			9.50
Average Earning Assets to Average Assets	89.99			89.63			89.42			89.51			89.82
Allowance for Loan Losses as % of Total Loans	1.45			1.47			1.58			1.63			1.74
Net Charge Off's as % of Average Loans (Annualized)	(0.03		)	0.06			0.12			0.27			0.47
Average Stockholders' Equity to Average Assets	12.34			12.31			12.62			12.34			12.18
Tax Equivalent Yield on Earning Assets	4.30			4.26			4.24			4.26			4.41
Cost of Supporting Liabilities	0.45			0.45			0.46			0.46			0.43
Net Interest Margin (FTE) on Earning Assets	3.85			3.81			3.78			3.80			3.98
Tangible Book Value Per Share	$	14.59		$	14.15		$	13.96		$	13.65		$	13.53



LOANS
(Dollars In Thousands)	September 30,			June 30,			March 31,			December 31,			September 30,
	2015			2015			2015			2014			2014
Commercial and industrial loans	$	999,195		$	984,223		$	938,937		$	896,688		$	900,970
Agricultural production financing and other loans to farmers	91,354			93,695			95,652			104,927			99,649
Real estate loans:
Construction	298,250			256,082			237,036			207,221			178,213
Commercial and farmland	1,695,703			1,705,647			1,646,418			1,672,661			1,603,698
Residential	677,767			689,621			640,451			647,315			625,609
Home Equity	318,949			302,403			286,914			286,529			269,952
Individuals' loans for household and other personal expenditures	71,893			62,785			70,223			73,400			66,832
Lease financing receivables, net of unearned income	614			742			853			1,106			1,208
Other commercial loans	167,990			143,007			49,048			35,018			26,336
Loans	4,321,715			4,238,205			3,965,532			3,924,865			3,772,467
Allowance for loan losses	(62,861		)	(62,550		)	(62,801		)	(63,964		)	(65,596		)
NET LOANS	$	4,258,854		$	4,175,655		$	3,902,731		$	3,860,901		$	3,706,871



DEPOSITS
(Dollars In Thousands)	September 30,		June 30,		March 31,		December 31,		September 30,
	2015		2015		2015		2014		2014
Demand deposits	$	2,244,848	$	2,211,154	$	2,116,135	$	2,146,492	$	1,947,040
Savings deposits	1,460,244		1,439,255		1,402,421		1,376,707		1,281,994
Certificates and other time deposits of $100,000 or more	286,988		295,159		283,313		260,685		241,163
Other certificates and time deposits	499,286		517,153		516,500		523,010		502,965
Brokered deposits	323,223		326,856		329,706		333,800		336,961
TOTAL DEPOSITS	$	4,814,589	$	4,789,577	$	4,648,075	$	4,640,694	$	4,310,123



NET INTEREST INCOME
(Dollars in Thousands)	For the Three Months Ended
	September 30, 2015							September 30, 2014
	Average Balance			Interest Income / Expense		Average Rate		Average Balance			Interest Income / Expense		Average Rate
Assets:
Interest-bearing time deposits	$	34,343		$	25	0.29	%	$	28,549		$	18	0.25	%
Federal Reserve and Federal Home Loan Bank stock	34,627			500		5.78		43,127			501		4.65
Investment Securities: ⁽¹⁾
Taxable	692,583			4,374		2.53		776,270			5,046		2.60
Tax-Exempt ⁽²⁾	503,174			6,787		5.40		409,241			5,665		5.54
Total Investment Securities	1,195,757			11,161		3.73		1,185,511			10,711		3.61
Loans held for sale	2,163			125		23.12		9,393			152		6.47
Loans: ⁽³⁾
Commercial	3,247,336			36,582		4.51		2,905,920			34,344		4.73
Real Estate Mortgage	447,733			4,803		4.29		455,714			5,025		4.41
Installment	403,399			4,526		4.49		369,797			4,460		4.82
Tax-Exempt ⁽²⁾	172,844			1,832		4.24		12,866			94		2.92
Total Loans	4,273,475			47,868		4.48		3,753,690			44,075		4.70
Total Earning Assets	5,538,202			59,554		4.30		5,010,877			55,305		4.41
Net unrealized gain on securities available for sale	10,379							11,247
Allowance for loan losses	(62,521		)					(68,123		)
Cash and cash equivalents	93,542							74,773
Premises and equipment	84,880							74,696
Other assets	489,467							475,234
Total Assets	$	6,153,949						$	5,578,704
Liabilities:
Interest-bearing deposits:
Interest-bearing NOW deposits	$	1,112,161		$	359	0.13	%	$	1,059,163		$	279	0.11	%
Money market deposits	837,963			448		0.21		736,339			372		0.20
Savings deposits	628,020			155		0.10		528,746			154		0.12
Certificates and other time deposits	1,122,964			2,753		0.98		1,032,274			2,048		0.79
Total Interest-bearing Deposits	3,701,108			3,715		0.40		3,356,522			2,853		0.34
Borrowings	523,814			2,500		1.91		572,923			2,571		1.80
Total Interest-bearing Liabilities	4,224,922			6,215		0.59		3,929,445			5,424		0.55
Noninterest-bearing deposits	1,123,575							932,266
Other liabilities	46,308							37,687
Total Liabilities	5,394,805							4,899,398
Stockholders' Equity	759,144							679,306
Total Liabilities and Stockholders' Equity	$	6,153,949		6,215		0.45		$	5,578,704		5,424		0.43
Net Interest Income				$	53,339						$	49,881
Net Interest Margin						3.85	%						3.98	%


(1) Average balance of securities is computed based on the average of the historical amortized cost balances without the effects of the fair value adjustments.
(2) Tax-exempt securities and loans are presented on a fully taxable equivalent basis, using a marginal tax rate of 35 percent for 2015 and 2014. These totals equal $3,016 and $2,015 for the three months ended September 30, 2015 and 2014, respectively.
(3) Non accruing loans have been included in the average balances.



NET INTEREST INCOME
(Dollars in Thousands)	For the Nine Months Ended
	September 30, 2015							September 30, 2014
	Average Balance			Interest Income / Expense		Average Rate		Average Balance			Interest Income / Expense		Average Rate
Assets:
Interest-bearing time deposits	$	50,327		$	93	0.25	%	$	43,906		$	76	0.23	%
Federal Reserve and Federal Home Loan Bank stock	38,367			1,509		5.24		41,657			1,648		5.27
Investment Securities: ⁽¹⁾
Taxable	708,328			13,522		2.55		761,924			14,902		2.61
Tax-Exempt ⁽²⁾	474,004			19,197		5.40		389,682			16,447		5.63
Total Investment Securities	1,182,332			32,719		3.69		1,151,606			31,349		3.63
Loans held for sale	4,364			380		11.61		6,653			322		6.45
Loans: ⁽³⁾
Commercial	3,161,385			106,412		4.49		2,893,922			99,685		4.59
Real Estate Mortgage	454,288			14,614		4.29		417,899			14,650		4.67
Installment	397,981			13,502		4.52		353,134			13,672		5.16
Tax-Exempt ⁽²⁾	103,931			3,344		4.29		12,328			277		3.00
Total Loans	4,121,949			138,252		4.47		3,683,936			128,606		4.65
Total Earning Assets	5,392,975			172,573		4.27	%	4,921,105			161,679		4.38	%
Net unrealized gain on securities available for sale	12,463							7,929
Allowance for loan losses	(62,940		)					(68,703		)
Cash and cash equivalents	96,671							83,259
Premises and equipment	82,342							74,732
Other assets	491,542							481,959
Total Assets	$	6,013,053						$	5,500,281
Liabilities:
Interest-bearing deposits:
Interest-bearing NOW deposits	$	1,077,463		$	894	0.11	%	$	1,061,762		$	827	0.10	%
Money market deposits	838,552			1,305		0.21		755,097			1,136		0.20
Savings deposits	604,436			481		0.11		527,147			461		0.12
Certificates and other time deposits	1,132,497			8,237		0.97		1,021,044			5,852		0.76
Total Interest-bearing Deposits	3,652,948			10,917		0.40		3,365,050			8,276		0.33
Borrowings	478,030			7,437		2.07		508,992			7,673		2.01
Total Interest-bearing Liabilities	4,130,978			18,354		0.59		3,874,042			15,949		0.55
Noninterest-bearing deposits	1,090,158							925,107
Other liabilities	45,215							38,724
Total Liabilities	5,266,351							4,837,873
Stockholders' Equity	746,702							662,408
Total Liabilities and Stockholders' Equity	$	6,013,053		18,354		0.45		$	5,500,281		15,949		0.43
Net Interest Income				$	154,219						$	145,730
Net Interest Margin						3.82	%						3.95	%


⁽¹⁾ Average balance of securities is computed based on the average of the historical amortized cost balances without the effects of the fair value adjustments.
⁽²⁾ Tax-exempt securities and loans are presented on a fully taxable equivalent basis, using a marginal tax rate of 35 percent for 2015 and 2014. These totals equal $7,889 and $5,853 for the nine months ended September 30, 2015 and 2014, respectively.
⁽³⁾ Non accruing loans have been included in the average balances.

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