Company: FRME
Filing Date: 2025-07-31
Form Type: 10-Q
Source: 0000712534-25-000171
Chunk: 79

Company: FIRST MERCHANTS CORP
Filing Date: 2025-07-31
Form: 10-Q
Item: Part I, Item 1
Chunk 79
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 0.9 percent, to $17.2 billion for the three months ended June 30, 2025, compared to the same period in 2024.  This increase was primarily driven by a $591.2 million, or 4.7 percent, increase in average total loans, which reached $13.2 billion. The growth in loans was led by a $314.9 million increase in commercial loans and a $218.1 million increase in tax-exempt loans. These increases were partially offset by a $381.0 million decline in average investment securities and a $70.0 million decline in interest-bearing deposits, reflecting a strategic shift away from lower-yielding assets.

Total average deposits decreased $263.8 million year-over-year. Average interest-bearing deposits decreased $100.9 million, primarily due to reductions in certificates and other time deposits and savings deposits, partially offset by an increase in money market deposits. Average noninterest-bearing deposits declined $162.8 million, as clients continued to migrate balances into interest-bearing products in response to the rate environment.

Average borrowings increased $364.6 million, driven by a $318.6 million increase in FHLB advances and a $76.2 million increase in federal funds purchased. These increases were partially offset by a $38.5 million decline in subordinated debt, reflecting the Corporation’s redemption of $30.0 million in the first quarter of 2025 and the redemption of $25.0 million of subordinated debt in April of 2024.

Six months ended June 30, 2025 and 2024

Total average earning assets remained relatively flat at $17.1 billion for the six months ended June 30, 2025, compared to the same period in 2024. Average loans increased $528.5 million, or 4.2 percent, to $13.1 billion, driven by growth of $244.2 million and $221.8 million in commercial and tax-exempt loans, respectively. This increase was offset by a $364.7 million decline in investment securities and a $176.0 million decline in interest-bearing deposits, consistent with the Corporation’s strategy to reallocate assets toward higher-yielding loans.

Total average deposits decreased $362.2 million million year-over-year. Average interest-bearing deposits decreased $172.5 million, with the largest decreases in certificates and other time deposits and money market deposits. Average noninterest-bearing deposits declined $189.8 million, reflecting continued client migration