Company: FRME
Filing Date: 2025-02-24
Form Type: 10-K
Source: 0000712534-25-000058
Chunk: 17

Company: FIRST MERCHANTS CORP
Filing Date: 2025-02-24
Form: 10-K
Item: Item 8
Chunk 17
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 into interest income over the remaining life of the loan using an effective yield method.  Additionally, non-PCD loans have an allowance for credit loss established on acquisition date, which is recognized in the current period provision for credit loss expense.  In the event of prepayment, unamortized discounts or premiums on PCD and non-PCD loans are recognized in interest income.

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PART II: ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATANOTES TO CONSOLIDATED FINANCIAL STATEMENTS(table dollar amounts in thousands, except share data)

ALLOWANCE FOR CREDIT LOSSES - LOANS (“ACL - LOANS”)The ACL - Loans is a valuation account that is deducted from the loans’ amortized cost basis to present the net amount expected to be collected on loans over the contractual term.  Loans are charged off against the allowance when the collectibility of the loan is unlikely.  Expected recoveries do not exceed the aggregate of amounts previously charged off and expected to be charged off.  Adjustments to the ACL - Loans are reported in the income statement as a component of provision for credit loss.  The Corporation has made the accounting policy election to exclude accrued interest receivable on loans from the estimate of credit losses.  Further information regarding the policies and methodology used to estimate the ACL - Loans is detailed in NOTE 5.  LOANS AND ALLOWANCE FOR CREDIT LOSSES of these Notes to Consolidated Financial Statements. PENSION The Corporation has defined-benefit pension plans, including non-qualified plans for certain employees, former employees and former non-employee directors.  In 2005, the Board of Directors of the Corporation approved the curtailment of the accumulation of defined benefits for future services provided by certain participants in the First Merchants Corporation Retirement Plan.  No additional pension benefits have been earned by any employees who had not met certain requirements as of March 1, 2005.  The benefits are based primarily on years of service and employees’ pay near retirement.  The Corporation’s accounting policies related to pensions and other post retirement benefits reflect the guidance in ASC 715, Compensation – Retirement Benefits.  The Corporation does not consolidate the assets and liabilities associated with the pension plan.  Instead, the Corporation recognizes the funded status of the plan in the Consolidated Balance Sheets.  The measurement of the funded status and the annual pension expense involves actuarial and economic assumptions.  Various statistical and other factors, which attempt to anticipate future events, are used in calculating the expense