Company: FRME
Filing Date: 2025-05-01
Form Type: 10-Q
Source: 0000712534-25-000117
Chunk: 171

Company: FIRST MERCHANTS CORP
Filing Date: 2025-05-01
Form: 10-Q
Item: Part I, Item 8
Chunk 171
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 to common stockholders and adjusted diluted earnings per common share are meaningful non-GAAP financial measures for management, as they provide a meaningful foundation for period-to-period and company-to-company comparisons, which management believes will aid both investors and analysts in analyzing our financial measures and predicting future performance.   

Net interest income and net interest margin presented on a fully taxable equivalent ("FTE") basis, reflecting the income tax savings when comparing tax-exempt and taxable assets using the federal statutory rate of 21 percent, are non-GAAP financial measures used by management to assess what our tax-exempt assets would need to yield in order to achieve the same after-tax yield as a taxable asset. Management believes that it is standard practice in the banking industry to present net interest income and net interest margin on an FTE basis and that it provides useful information for management and investors for peer comparison purposes. Non-GAAP financial measures such as tangible common equity, tangible assets, tangible common equity to tangible assets, tangible book value per common share, tangible net income available to common stockholders, diluted tangible net income per common share, return on average tangible capital and return on average tangible assets are important measures of the strength of the Corporation's capital and ability to generate earnings on tangible common equity invested by our shareholders.  These non-GAAP measures provide useful supplemental information and may assist investors in analyzing the Corporation’s financial position without regard to the effects of intangible assets and preferred stock, but do retain the effect of accumulated other comprehensive losses in stockholders' equity.  Disclosure of these measures also allows analysts and banking regulators to assess our capital adequacy on these same bases.

ADJUSTED NET INCOME AND DILUTED EARNINGS PER COMMON SHARE - NON-GAAP(Dollars in thousands, except per share amounts)Three Months EndedMarch 31,December 31,March 31,202520242024Net Income Available to Common Stockholders (GAAP)$54,870 $63,880 $47,472 Adjustments:Net realized losses on sales of available for sale securities7 11,592 2 Gain on branch sale— (19,983)— Non-core expenses 1, 2— 762 3,481 Tax on adjustment(2)1,851 (848)Adjusted Net Income Available to Common Stockholders (non-GAAP)$54,875 $58,102 $50,107 Average Diluted Common Shares Outstanding (in thousands)58,242 58,247 59,