Company: FRME
Filing Date: 2025-07-31
Form Type: 10-Q
Source: 0000712534-25-000171
Chunk: 248

Company: FIRST MERCHANTS CORP
Filing Date: 2025-07-31
Form: 10-Q
Item: Part I, Item 2
Chunk 248
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ANCIAL INFORMATIONITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

NONINTEREST INCOME

Noninterest income remained flat at $31.3 million for the three months ended June 30, 2025 compared to the same period in 2024.  Modest increases in net gains on sales of loans, treasury management fees, derivative hedge fees and card payment fees totaling $1.6 million were offset by a comparable decline in other income, which included lower contributions from CRA-related activities.

For the six months ended June 30, 2025, noninterest income totaled $61.4 million, representing a $3.4 million, or 5.8 percent, increase over the  same period in 2024.  The increase was attributable to a $4.1 million improvement in customer-related fees, including an increase in net gains from loan sales, derivative hedge fees, treasury management fees and card payment fees. These increases were partially offset by a decrease in other income, in part due to reduced earnings from CRA investments.

NONINTEREST EXPENSE

Noninterest expense totaled $93.6 million for the three months ended June 30, 2025, a $2.2 million, or 2.4 percent, increase from the second quarter of 2024.  Salaries and employee benefits expense increased by $2.3 million, primarily due to higher incentives paid during the three months ended June 30, 2025. 

For the six months ended June 30, 2025, noninterest expense totaled $186.5 million, a $1.8 million, or 1.0 percent, decrease compared to the same period in 2024.  This decrease was primarily driven by a $1.0 million decrease in salaries and employee benefits, a $0.9 million decrease in outside data processing fees and a $0.8 million decrease in professional and other outside services expenses.  These decreases were partially offset by a $1.1 million increase in equipment-related expenses. 

INCOME TAXES

Income tax expense for the three months ended June 30, 2025 was $8.3 million on pre-tax income of $65.1 million.  For the same period in 2024, income tax expense was $4.1 million on pre-tax income of $44.0 million.  The effective income tax rates for the second quarter of 2025 and 202