##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, DC 20549
 FORM 10-Q
 þ
    
    Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the quarterly period ended March 31, 2008.
 or
 o
    
    Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the transition period from  to .
 Commission file number: 0-13585
 INTEGRA BANK CORPORATION
  INDIANA
    
    35-1632155(State or other jurisdiction of incorporation or organization)
    
    (IRS Employee Identification No.)
 PO BOX 868, EVANSVILLE, INDIANA
    
    47705-0868(Address of principal executive offices)
    
    (Zip Code)
  þ o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 Yes o No þ
  CLASS
    
    OUTSTANDING AT APRIL 30, 2008(Common stock, $1.00 Stated Value)
    
    20,664,165




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##### 



INTEGRA BANK CORPORATION
 INDEX
 PAGE NO.PART I  FINANCIAL INFORMATIONItem 1. Unaudited Financial StatementsConsolidated balance sheets-March 31, 2008 and December 31, 2007
    
    
    3Consolidated statements of income-Three months ended March 31, 2008 and 2007
    
    
    4Consolidated statements of comprehensive income-Three months ended March 31, 2008 and 2007
    
    
    5Consolidated statements of changes in shareholders equity-Three months ended March 31, 2008
    
    
    6Consolidated statements of cash flow-Three months ended March 31, 2008 and 2007
    
    
    7Notes to unaudited consolidated financial statements
    
    
    8Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    18Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    27Item 4. Controls and Procedures
    
    
    29PART II  OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    30Item 1A. Risk Factors
    
    
    30Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    30Item 3. Defaults Upon Senior Securities
    
    
    30Item 4. Submissions of Matters to a Vote of Security Holders
    
    
    30Item 5. Other Information
    
    
    30Item 6. Exhibits
    
    
    30Signatures
    
    
    31Exhibit 31.1Exhibit 31.2Exhibit 32
   2




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##### Table of Contents



PART I  FINANCIAL INFORMATION
 
 Item 1. Unaudited Financial Statements
 INTEGRA BANK CORPORATION and Subsidiaries
 
 Unaudited Consolidated Balance Sheets
 March 31,
    
    
    December 31,2008
    
    
    2007ASSETSCash and due from banks
    
    $
    81,156
    
    
    $
    72,360Federal funds sold and other short-term investments
    
    
    3,992
    
    
    
    3,630Total cash and cash equivalents
    
    
    85,148
    
    
    
    75,990Loans held for sale (at lower of cost or fair value)
    
    
    6,480
    
    
    
    5,928Securities available for sale
    
    
    632,758
    
    
    
    582,954Securities held for trading
    
    
    
    
    
    
    53,782Regulatory stock
    
    
    29,181
    
    
    
    29,179Loans, net of unearned income
    
    
    2,340,750
    
    
    
    2,311,378Less: Allowance for loan losses
    
    
    (28,590
    )
    
    
    (27,261
    )Net loans
    
    
    2,312,160
    
    
    
    2,284,117Premises and equipment
    
    
    50,228
    
    
    
    50,552Goodwill
    
    
    122,824
    
    
    
    123,050Other intangible assets
    
    
    11,221
    
    
    
    11,652Other assets
    
    
    150,610
    
    
    
    132,922TOTAL ASSETS
    
    $
    3,400,610
    
    
    $
    3,350,126LIABILITIESDeposits:Non-interest-bearing demand
    
    $
    295,942
    
    
    $
    265,554Interest-bearing:Savings, interest checking and money market accounts
    
    
    946,454
    
    
    
    918,023Time deposits of $100 or more
    
    
    470,574
    
    
    
    505,491Other interest-bearing
    
    
    595,153
    
    
    
    651,069Total deposits
    
    
    2,308,123
    
    
    
    2,340,137Short-term borrowings
    
    
    367,022
    
    
    
    272,270Long-term borrowings
    
    
    360,754
    
    
    
    376,707Other liabilities
    
    
    33,561
    
    
    
    33,208TOTAL LIABILITIES
    
    
    3,069,460
    
    
    
    3,022,322Commitments and contingent liabilities (Note 7)
    
    
    
    
    
    
    SHAREHOLDERS EQUITYPreferred stock  1,000,000 shares authorizedNone outstandingCommon stock  $1.00 stated value:Shares authorized: 29,000,000Shares outstanding: 20,657,365 and 20,650,165 respectively
    
    
    20,657
    
    
    
    20,650Additional paid-in capital
    
    
    207,332
    
    
    
    206,991Retained earnings
    
    
    104,247
    
    
    
    104,913Accumulated other comprehensive income (loss)
    
    
    (1,086
    )
    
    
    (4,750
    )TOTAL SHAREHOLDERS EQUITY
    
    
    331,150
    
    
    
    327,804TOTAL LIABILITIES AND SHAREHOLDERS EQUITY
    
    $
    3,400,610
    
    
    $
    3,350,126
   3




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##### Table of Contents



INTEGRA BANK CORPORATION and Subsidiaries
 
 Unaudited Consolidated Statements of Income
 Three Months EndedMarch 31,2008
    
    
    2007INTEREST INCOMEInterest and fees on loans:Taxable
    
    $
    38,701
    
    
    $
    32,029Tax-exempt
    
    
    81
    
    
    
    101Interest and dividends on securities:Taxable
    
    
    6,480
    
    
    
    6,246Tax-exempt
    
    
    1,312
    
    
    
    1,043Dividends on regulatory stock
    
    
    376
    
    
    
    346Interest on loans held for sale
    
    
    103
    
    
    
    28Interest on federal funds sold and other short-term investments
    
    
    38
    
    
    
    49Total interest income
    
    
    47,091
    
    
    
    39,842INTEREST EXPENSEInterest on deposits
    
    
    16,392
    
    
    
    14,684Interest on short-term borrowings
    
    
    2,166
    
    
    
    2,018Interest on long-term borrowings
    
    
    5,015
    
    
    
    2,811Total interest expense
    
    
    23,573
    
    
    
    19,513NET INTEREST INCOME
    
    
    23,518
    
    
    
    20,329Provision for loan losses
    
    
    3,634
    
    
    
    735Net interest income after provision for loan losses
    
    
    19,884
    
    
    
    19,594NON-INTEREST INCOMEService charges on deposit accounts
    
    
    4,699
    
    
    
    4,218Other service charges and fees
    
    
    998
    
    
    
    938Commissions on annuities
    
    
    581
    
    
    
    266Debit card income-interchange
    
    
    1,243
    
    
    
    895Trust income
    
    
    559
    
    
    
    614Net securities gains (losses)
    
    
    24
    
    
    
    166Gain on sale of other assets
    
    
    
    
    
    
    539Bank-owned life insurance income
    
    
    643
    
    
    
    414Other
    
    
    1,987
    
    
    
    1,165Total non-interest income
    
    
    10,734
    
    
    
    9,215NON-INTEREST EXPENSESalaries and employee benefits
    
    
    12,394
    
    
    
    10,765Occupancy
    
    
    2,560
    
    
    
    2,107Equipment
    
    
    928
    
    
    
    824Professional fees
    
    
    984
    
    
    
    1,137Communication and transportation
    
    
    1,456
    
    
    
    1,171Processing
    
    
    718
    
    
    
    510Software
    
    
    559
    
    
    
    467Marketing
    
    
    482
    
    
    
    588Low income housing project losses
    
    
    651
    
    
    
    617Amortization of intangible assets
    
    
    431
    
    
    
    233Other
    
    
    2,958
    
    
    
    1,748Total non-interest expense
    
    
    24,121
    
    
    
    20,167Income before income taxes
    
    
    6,497
    
    
    
    8,642Income tax expense
    
    
    1,524
    
    
    
    1,286NET INCOME
    
    $
    4,973
    
    
    $
    7,356Earnings per share:Basic
    
    $
    0.24
    
    
    $
    0.42Diluted
    
    
    0.24
    
    
    
    0.41Weighted average shares outstanding:Basic
    
    
    20,537
    
    
    
    17,678Diluted
    
    
    20,544
    
    
    
    17,786
   4




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##### Table of Contents



INTEGRA BANK CORPORATION and Subsidiaries
 
 Unaudited Consolidated Statements of Comprehensive Income
 Three Months EndedMarch 31,2008
    
    
    2007Net income
    
    $
    4,973
    
    
    $
    7,356Other comprehensive income, net of tax:Unrealized gain (loss) on securities:Unrealized gain (loss) arising in period
(net of tax of $2,508 and $1,118, respectively)
    
    
    3,280
    
    
    
    1,683Reclassification of realized amounts
(net of tax of $(9) and $(67), respectively)
    
    
    (15
    )
    
    
    (99
    )Net unrealized gain (loss) on securities
    
    
    3,265
    
    
    
    1,584Adjustment to the minimum pension liability
(net of tax of $15 for 2008)
    
    
    25
    
    
    
    Unrealized gain on derivative hedging instruments arising in period
(net of tax of $185 and $4, respectively)
    
    
    374
    
    
    
    6Net unrealized gain (loss), recognized in other comprehensive income
    
    
    3,664
    
    
    
    1,590Comprehensive income
    
    $
    8,637
    
    
    $
    8,946
   5




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##### Table of Contents



INTEGRA BANK CORPORATION and Subsidiaries
 
 Unaudited Consolidated Statements of Changes In Shareholders Equity
 AccumulatedAdditional
    
    
    
    
    
    
    OtherCommon
    
    
    Common
    
    
    Paid-in
    
    
    Retained
    
    
    ComprehensiveShares
    
    
    Stock
    
    
    Capital
    
    
    Earnings
    
    
    Income (Loss)
    
    
    TotalBALANCE AT DECEMBER 31, 2007
    
    
    20,650,165
    
    
    $
    20,650
    
    
    $
    206,991
    
    
    $
    104,913
    
    
    $
    (4,750
    )
    
    $
    327,804Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,973
    
    
    
    
    
    
    
    4,973Cash dividend declared ($0.18 per share)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,717
    )
    
    
    
    
    
    
    (3,717
    )Change, net of tax, in unrealized gain/loss on:Securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,265
    
    
    
    3,265Interest rate swaps
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    374
    
    
    
    374Change in unrealized postretirement
liability, net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    25
    
    
    
    25Initial adoption of EITF 06-4
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,922
    )
    
    
    
    
    
    
    (1,922
    )Grant of restricted stock, net of forfeitures
    
    
    7,200
    
    
    
    7
    
    
    
    (7
    )
    
    
    
    
    
    
    
    
    
    
    Stock-based compensation expense
    
    
    
    
    
    
    
    
    
    
    348
    
    
    
    
    
    
    
    
    
    
    
    348BALANCE AT MARCH 31, 2008
    
    
    20,657,365
    
    
    $
    20,657
    
    
    $
    207,332
    
    
    $
    104,247
    
    
    $
    (1,086
    )
    
    $
    331,150
   6




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##### Table of Contents



INTEGRA BANK CORPORATION and Subsidiaries
 
 Unaudited Consolidated Statements of Cash Flow
 Three Months EndedMarch 31,2008
    
    
    2007CASH FLOWS FROM OPERATING ACTIVITIESNet income
    
    $
    4,973
    
    
    $
    7,356Adjustments to reconcile net income to
net cash provided by operating activities:Amortization and depreciation
    
    
    1,789
    
    
    
    1,389Provision for loan losses
    
    
    3,634
    
    
    
    735Net securities (gains) losses
    
    
    (24
    )
    
    
    (166
    )Net held for trading (gains) losses
    
    
    (321
    )
    
    
    Gain on sale of other real estate owned
    
    
    
    
    
    
    3Gain on sale of other assets
    
    
    
    
    
    
    12Gain on sale of mortgage servicing rights
    
    
    
    
    
    
    (555
    )Loss on low-income housing investments
    
    
    651
    
    
    
    617Proceeds from maturities of held for trading securities
    
    
    1,682
    
    
    
    Proceeds from sales of held for trading securities
    
    
    52,421
    
    
    
    Increase (decrease) in deferred taxes
    
    
    
    
    
    
    (43
    )Net gain on sale of loans held for sale
    
    
    (291
    )
    
    
    (159
    )Proceeds from sale of loans held for sale
    
    
    36,739
    
    
    
    11,459Origination of loans held for sale
    
    
    (37,000
    )
    
    
    (10,847
    )Change in other operating
    
    
    (21,303
    )
    
    
    2,754Net cash flows provided by operating activities
    
    
    42,950
    
    
    
    12,555CASH FLOWS FROM INVESTING ACTIVITIESProceeds from maturities of securities available for sale
    
    
    35,708
    
    
    
    27,474Proceeds from sales of securities available for sale
    
    
    7,957
    
    
    
    Purchase of securities available for sale
    
    
    (87,671
    )
    
    
    (6,000
    )(Increase) decrease in loans made to customers
    
    
    (31,966
    )
    
    
    (164
    )Purchase of premises and equipment
    
    
    (833
    )
    
    
    (806
    )Proceeds from sale of other real estate owned
    
    
    
    
    
    
    42Net cash flows provided by (used in) investing activities
    
    
    (76,805
    )
    
    
    20,546CASH FLOWS FROM FINANCING ACTIVITIESNet increase (decrease) in deposits
    
    
    (32,069
    )
    
    
    41,876Excess income tax benefit from employee stock-based awards
    
    
    
    
    
    
    4Net increase (decrease) in short-term borrowed funds
    
    
    94,752
    
    
    
    (8,851
    )Proceeds from long-term borrowings
    
    
    50,000
    
    
    
    36,000Repayment of long-term borrowings
    
    
    (65,953
    )
    
    
    (103,095
    )Repurchase of common stock
    
    
    
    
    
    
    (3,002
    )Dividends paid
    
    
    (3,717
    )
    
    
    (3,025
    )Proceeds from exercise of stock options
    
    
    
    
    
    
    64Net cash flows provided by (used in) financing activities
    
    
    43,013
    
    
    
    (40,029
    )Net increase (decrease) in cash and cash equivalents
    
    
    9,158
    
    
    
    (6,928
    )Cash and cash equivalents at beginning of year
    
    
    75,990
    
    
    
    69,398Cash and cash equivalents at end of period
    
    $
    85,148
    
    
    $
    62,470SUPPLEMENTAL DISCLOSURE OF NONCASH TRANSACTIONSOther real estate acquired in settlement of loans
    
    
    321
    
    
    
    355Dividends declared and not paid
    
    
    3,718
    
    
    
    3,005
   7




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##### Table of Contents



INTEGRA BANK CORPORATION and Subsidiaries
 
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 BASIS OF PRESENTATION:
    RECENT ACCOUNTING PRONOUNCEMENTS:
      8




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##### Table of Contents



FAIR VALUE MEASUREMENT
   Level 1:
 Level 2:
 Level 3:
  Securities:
 Loans held for sale:
 Derivatives:
  9




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##### Table of Contents



Impaired Loans:
  Quoted Pricesin ActiveMarkets for
    
    
    SignificantIdentical
    
    
    Other
    
    
    SignificantAssets and
    
    
    Observable
    
    
    UnobservableLiabilities
    
    
    Inputs
    
    
    Inputs
    
    
    Balance as of(Level 1)
    
    
    (Level 2)
    
    
    (Level 3)
    
    
    March 31, 2008AssetsSecurities,
available for sale
    
    $
    
    
    
    $
    632,758
    
    
    $
    
    
    
    $
    632,758Derivatives
    
    
    
    
    
    
    6,434
    
    
    
    
    
    
    
    6,434LiabilitiesDerivatives
    
    $
    
    
    
    $
    4,546
    
    
    $
    
    
    
    $
    4,546
  Quoted Pricesin ActiveMarkets for
    
    
    SignificantIdentical
    
    
    Other
    
    
    SignificantAssets and
    
    
    Observable
    
    
    UnobservableLiabilities
    
    
    Inputs
    
    
    Inputs
    
    
    Balance as of(Level 1)
    
    
    (Level 2)
    
    
    (Level 3)
    
    
    March 31, 2008AssetsImpaired Loans
    
    $
    
    
    
    $
    
    
    
    $
    3,199
    
    
    $
    3,199Loans held for sale
    
    
    6,480
    
    
    
    
    
    
    
    
    
    
    
    6,480Liabilities
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
     10




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##### Table of Contents



STOCK-BASED COMPENSATION:
     2008
    
    
    2007Number of options/SARs granted
    
    
    5,000
    
    
    
    8,000Stock price
    
    $
    13.19
    
    
    $
    25.62Risk-free interest rate
    
    
    3.13
    %
    
    
    4.78
    %Expected life, in years
    
    
    6
    
    
    
    6Expected volatility
    
    
    21.62
    %
    
    
    22.65
    %Expected dividend yield
    
    
    5.46
    %
    
    
    2.70
    %Estimated fair value per option
    
    $
    1.49
    
    
    $
    5.91
  March 31, 2008Weighted AverageShares
    
    
    Exercise PriceOptions/SARs outstanding at December 31, 2007
    
    
    1,386,983
    
    
    $
    21.74Options/SARs granted
    
    
    5,000
    
    
    
    13.19Options/SARs exercised
    
    
    
    
    
    
    Options/SARs forfeited/expired
    
    
    
    
    
    
    Options/SARs outstanding at March 31, 2008
    
    
    1,391,983
    
    
    $
    21.71Options/SARs exercisable at March 31, 2008
    
    
    1,070,516
    
    
    $
    21.30
   11




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##### Table of Contents



Weighted-AverageGrant-DateShares
    
    
    Fair ValueRestricted shares outstanding, December 31, 2007
    
    
    113,962
    
    
    $
    22.80Shares granted
    
    
    7,200Shares vested
    
    
    (667
    )Shares forfeited
    
    
    Restricted shares outstanding, March 31, 2008
    
    
    120,495
    
    
    $
    22.36
  NOTE 2. EARNINGS PER SHARE
  Three Months EndedMarch 31,2008
    
    
    2007Net income
    
    $
    4,973
    
    
    $
    7,356Weighted average shares outstanding  Basic
    
    
    20,536,760
    
    
    
    17,678,483Incremental shares related to stock compensation
    
    
    7,218
    
    
    
    107,137Average shares outstanding  Diluted
    
    
    20,543,978
    
    
    
    17,785,620Earnings per share  Basic
    
    $
    0.24
    
    
    $
    0.42Effect of incremental shares related to stock compensation
    
    
    
    
    
    
    0.01Earnings per share  Diluted
    
    $
    0.24
    
    
    $
    0.41
   12




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##### Table of Contents



NOTE 3. SECURITIES
  Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gains
    
    
    Losses
    
    
    ValueMarch 31,
2008:U.S. Government agencies
    
    $
    6,051
    
    
    $
    48
    
    
    $
    
    
    
    $
    6,099Collateralized Mortgage Obligations:Agency
    
    
    266,487
    
    
    
    3,386
    
    
    
    1,130
    
    
    
    268,743Private Label
    
    
    40,854
    
    
    
    144
    
    
    
    2,104
    
    
    
    38,894Mortgage-backed securities
    
    
    155,171
    
    
    
    1,854
    
    
    
    76
    
    
    
    156,949FHLMC Preferred stock
    
    
    9,973
    
    
    
    274
    
    
    
    
    
    
    
    10,247Trust Preferred
    
    
    49,201
    
    
    
    96
    
    
    
    6,194
    
    
    
    43,103States & political subdivisions
    
    
    100,258
    
    
    
    3,491
    
    
    
    25
    
    
    
    103,724Other securities
    
    
    5,013
    
    
    
    
    
    
    
    14
    
    
    
    4,999Total
    
    $
    633,008
    
    
    $
    9,293
    
    
    $
    9,543
    
    
    $
    632,758
 Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gains
    
    
    Losses
    
    
    ValueDecember 31, 2007:U.S. Government agencies
    
    $
    16,074
    
    
    $
    69
    
    
    $
    1
    
    
    $
    16,142Collateralized Mortgage Obligations:Agency
    
    
    238,608
    
    
    
    486
    
    
    
    4,430
    
    
    
    234,664Private Label
    
    
    41,936
    
    
    
    90
    
    
    
    707
    
    
    
    41,319Mortgage-backed securities
    
    
    122,976
    
    
    
    661
    
    
    
    826
    
    
    
    122,811FHLMC Preferred stock
    
    
    9,973
    
    
    
    
    
    
    
    
    
    
    
    9,973Trust Preferred
    
    
    49,860
    
    
    
    110
    
    
    
    3,726
    
    
    
    46,244States & political subdivisions
    
    
    104,528
    
    
    
    2,385
    
    
    
    94
    
    
    
    106,819Other securities
    
    
    5,013
    
    
    
    
    
    
    
    31
    
    
    
    4,982Total
    
    $
    588,968
    
    
    $
    3,801
    
    
    $
    9,815
    
    
    $
    582,954
  Less than 12 Months
    
    
    12 Months or More
    
    
    TotalUnrealized
    
    
    
    
    
    
    Unrealized
    
    
    
    
    
    
    UnrealizedMarch 31, 2008
    
    Fair Value
    
    
    Losses
    
    
    Fair Value
    
    
    Losses
    
    
    Fair Value
    
    
    LossesCollateralized mortgage obligations:Agency
    
    $
    39,450
    
    
    $
    382
    
    
    $
    39,289
    
    
    $
    748
    
    
    $
    78,739
    
    
    $
    1,130Private label
    
    
    10,879
    
    
    
    585
    
    
    
    17,574
    
    
    
    1,519
    
    
    
    28,453
    
    
    
    2,104Mortgage-backed securities
    
    
    3,683
    
    
    
    15
    
    
    
    10,610
    
    
    
    61
    
    
    
    14,293
    
    
    
    76Trust Preferred
    
    
    33,021
    
    
    
    6,194
    
    
    
    
    
    
    
    
    
    
    
    33,021
    
    
    
    6,194State & political subdivisions
    
    
    867
    
    
    
    23
    
    
    
    64
    
    
    
    2
    
    
    
    931
    
    
    
    25Other securities
    
    
    2,411
    
    
    
    14
    
    
    
    
    
    
    
    
    
    
    
    2,411
    
    
    
    14Total
    
    $
    90,311
    
    
    $
    7,213
    
    
    $
    67,537
    
    
    $
    2,330
    
    
    $
    157,848
    
    
    $
    9,543
    13




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##### Table of Contents



NOTE 4. INCOME TAXES
     NOTE 5. SHORT-TERM BORROWINGS
  March 31,
    
    
    December 31,2008
    
    
    2007Federal funds purchased
    
    $
    80,900
    
    
    $
    55,100Securities sold under agreements to repurchase
    
    
    91,122
    
    
    
    97,170Short-term Federal Home Loan Bank advances
    
    
    195,000
    
    
    
    120,000Total short-term borrowed funds
    
    $
    367,022
    
    
    $
    272,270
  14




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##### Table of Contents



NOTE 6. LONG-TERM BORROWINGS
  March 31,
    
    
    December 31,2008
    
    
    2007Federal Home Loan Bank AdvancesFixed maturity advances (weighted average rate of 3.33% and 4.57%
as of March 31, 2008 and December 31, 2007, respectively)
    
    $
    136,210
    
    
    $
    86,211Amortizing and other advances (weighted average rate of 5.05% and
5.11% as of March 31, 2008 and December 31, 2007, respectively)
    
    
    1,412
    
    
    
    1,607Total FHLB Advances
    
    
    137,622
    
    
    
    87,818Securities sold under repurchase agreements with maturities
at various dates through 2013 (weighted average fixed rate of 4.65%
and 3.94% as of March 31, 2008 and December 31, 2007, respectively)
    
    
    100,000
    
    
    
    165,000Note payable, secured by equipment, with a fixed interest rate of 7.26%,
due at various dates through 2012
    
    
    4,578
    
    
    
    4,835Note payable, unsecured, with a floating interest rate equal to one-month
LIBOR plus 0.875%, with a maturity date of April 1, 2012
    
    
    19,500
    
    
    
    20,000Subordinated debt, unsecured, with a floating interest rate equal to
three-month LIBOR plus 3.20%, with a maturity date of April 24, 2013
    
    
    10,000
    
    
    
    10,000Subordinated debt, unsecured, with a floating interest rate equal to
three-month LIBOR plus 2.85%, with a maturity date of April 7, 2014
    
    
    4,000
    
    
    
    4,000Floating Rate Capital Securities, with an interest rate equal to six-month
LIBOR plus 3.75%, with a maturity date of July 25, 2031, and callable
effective July 25, 2011, at par
    
    
    18,557
    
    
    
    18,557Floating Rate Capital Securities, with an interest rate equal to three-month
LIBOR plus 3.10%, with a maturity date of June 26, 2033, and callable
effective June 26, 2008, at par
    
    
    35,568
    
    
    
    35,568Floating Rate Capital Securities, with an interest rate equal to three-month
LIBOR plus 1.57%, with a maturity date of June 30, 2037, and callable
effective June 30, 2012, at par
    
    
    20,619
    
    
    
    20,619Floating Rate Capital Securities, with an interest rate equal to three-month
LIBOR plus 1.70%, with a maturity date of December 15, 2036, and callable
effective December 15, 2011, at par
    
    
    10,310
    
    
    
    10,310Total long-term borrowings
    
    $
    360,754
    
    
    $
    376,707
     15




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##### Table of Contents



NOTE 7. COMMITMENTS AND CONTINGENCIES
    March 31,
    
    
    December 31,2008
    
    
    2007Commitments to extend credit
    
    $
    932,016
    
    
    $
    855,430Standby letters of credit
    
    
    18,869
    
    
    
    19,434Non-reimbursable standby letters of credit
    
    
    2,220
    
    
    
    2,220
 NOTE 8. INTEREST RATE CONTRACTS
        16




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##### Table of Contents



NOTE 9. SEGMENT INFORMATION
   For three months ended March 31, 2008
    
    Banking
    
    
    Other
    
    
    TotalInterest income
    
    $
    47,027
    
    
    $
    64
    
    
    $
    47,091Interest expense
    
    
    21,581
    
    
    
    1,992
    
    
    
    23,573Net interest income (loss)
    
    
    25,446
    
    
    
    (1,928
    )
    
    
    23,518Provision for loan losses
    
    
    3,634
    
    
    
    
    
    
    
    3,634Other income
    
    
    10,642
    
    
    
    92
    
    
    
    10,734Other expense
    
    
    23,824
    
    
    
    297
    
    
    
    24,121Earnings before income taxes
    
    
    8,630
    
    
    
    (2,133
    )
    
    
    6,497Income tax expense (benefit)
    
    
    2,328
    
    
    
    (804
    )
    
    
    1,524Net income
    
    $
    6,302
    
    
    $
    (1,329
    )
    
    $
    4,973Segment assets
    
    $
    3,393,521
    
    
    $
    7,803
    
    
    $
    3,401,324
 For three months ended March 31, 2007
    
    Banking
    
    
    Other
    
    
    TotalInterest income
    
    $
    39,790
    
    
    $
    52
    
    
    $
    39,842Interest expense
    
    
    18,042
    
    
    
    1,471
    
    
    
    19,513Net interest income (loss)
    
    
    21,748
    
    
    
    (1,419
    )
    
    
    20,329Provision for loan losses
    
    
    735
    
    
    
    
    
    
    
    735Other income
    
    
    9,081
    
    
    
    134
    
    
    
    9,215Other expense
    
    
    19,906
    
    
    
    261
    
    
    
    20,167Earnings before income taxes
    
    
    10,188
    
    
    
    (1,546
    )
    
    
    8,642Income tax expense (benefit)
    
    
    1,877
    
    
    
    (591
    )
    
    
    1,286Net income
    
    $
    8,311
    
    
    $
    (955
    )
    
    $
    7,356Segment assets
    
    $
    2,648,541
    
    
    $
    7,670
    
    
    $
    2,656,211
  17




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 INTRODUCTION
   OVERVIEW
      
    
    The annualized net charge-off rate was 0.40% for the first quarter of 2008, compared
to 0.25% for the fourth quarter of 2007. Net charge-offs for the first quarter of 2008
include a $1,378 loss on an automobile dealer floor plan. This loss comprised 24 basis
points of the 40 basis points of charge-offs for the quarter. The remainder of our net
charge-offs were in line with our expectations. Losses from the Chicago residential
builder construction portfolio were less than 1 basis point of total net charge-offs.
    
    The net interest margin declined 19 basis points to 3.23%. The decrease in the
net interest margin from the fourth quarter of 2007 included a decrease in the yield on
earning assets of 63 basis points, compared to a 48 basis point decrease in the cost of
interest bearing liabilities. These decreases are due primarily to 200 basis points of
rate cuts by the Federal Reserve during
the first quarter of 2008, coupled with the fact that our assets reprice much more quickly
than our liabilities. Improvement in our earning asset mix partially offset the decline due
to the lower rates, as commercial loan average balances were 54.4% of earning assets for the
first quarter of 2008 compared to 53.2% for the fourth quarter of 2007 and 42.3% for the
first quarter of 2007. The increase from the first quarter of 2007 was due to the April 2007
Prairie acquisition in April, 2007, coupled with consistent commercial loan growth throughout
2007 and during the first quarter of 2008. The timing of rate resets after the 200 basis
points of rate cuts contributed to a $1,137 decrease in net interest income from the fourth
quarter of 2007.
  18




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##### Table of Contents




    
    Non-performing loans increased $7,394 to 1.28% of total loans, compared to 0.98% of
total loans at December 31, 2007 and 0.50% at March 31, 2007. The increase during the
last part of 2007 and the first quarter of 2008 was primarily within our Chicago
residential builder construction portfolio, which made up approximately 60% of total
non-performing loans at both December 31, 2007 and March 31, 2008.
    
    The allowance for loan losses to total loans was 1.22% at March 31, 2008, compared
to 1.18% at both December 31, 2007 and March 31, 2007, while the allowance to
non-performing loans was 95% at March 31, 2008, compared to 120% at December 31, 2007 and
239% at March 31, 2007.
    
    Our earning asset mix continued to improve, driven by commercial loan growth.
Commercial loan average balances increased $63,354, or 16.2%, from the fourth quarter of
2007. Growth was broadly based, coming primarily from commercial real estate, as well as
from our Cincinnati, Evansville and Chicago markets.
    
    Low cost deposit average balances, which include interest checking, demand deposit
and savings accounts, increased $28,404 or 14.6% annualized from the fourth quarter of
2007.
   
    
    Maintain sound credit through an uncertain economic environment;
    
    Add new customers and do more with them as we continue our growth initiatives;
    
    Improve our net interest margin and net interest income by improving our loan and
earning asset mix and by growing our low-cost deposit balances;
    
    Improve operating leverage (grow revenue faster than expenses) by reducing expenses in
lower growth and lower profitability lines of business and by investing in higher growth
and higher return lines of business;
    
    Increase our presence in faster growing metro markets by recruiting successful and
experienced lending and product teams and through disciplined, selective acquisitions; and
    
    Allocate capital to its highest uses to increase total shareholder returns.
  
    
    maintain sound credit quality through an uncertain economic environment by applying
strict underwriting standards and actively managing our non-performing loans;
    
    improve the net interest margin by increasing commercial loans and low cost deposits and
by carefully managing through the current declining rate environment;
    
    grow by capitalizing on our investments in commercial real estate and commercial and
industrial lending, by continuing our success with the High Performance Checking program,
which has resulted in more accounts and increases in debit card interchange and service
charge income, and by capitalizing on our recent investments in our treasury management
business; and
    
    increase total shareholder return by targeting the return of 35-70% of earnings to our
shareholders, either through dividends or share repurchases.
  19




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##### Table of Contents



CRITICAL ACCOUNTING POLICIES
  NET INTEREST INCOME
   
    
    The decrease to the net interest margin reflected the impact of the Federal Reserves
reductions of the key interbank borrowing rate which began in the fourth quarter of 2007.
During the first quarter of 2008, the federal funds rate declined by 200 basis points.
Average loan yields decreased 64 basis points to 6.61% for the quarter ended March 31,
2008, from 7.25% in the quarter ended March 31, 2007, led by a decrease in commercial loan
yields, including loan fees, of 108 basis points to 6.54%. The decreases in yields for
commercial loans occurred primarily during the first quarter of 2008, when yields declined
105 basis points. Our asset sensitivity (meaning that a change in prevailing interest
rates impacts our assets more quickly than our liabilities), contributed to a decline in
our margin in the first quarter. Approximately 42% of our variable rate loans are tied to
prime, 41% to LIBOR and 17% to other floating rate indices. While the decrease in
commercial loan yields for the quarter is comparable to the decrease in money market fund
rates of 99 basis points to 2.85%, it is well in excess of the decline of time deposit
rates of only 28 basis points to 4.41%. Time deposits made up 41.3% of our interest
bearing liabilities for the first quarter of 2008, while commercial loans made up 54.4% of
earning assets. The average remaining maturity of our time deposits at March 31, 2008 was
7 months, meaning that the portfolio should reprice at lower rates or be replaced with
lower costing alternative sources of funds.
    
    The improvement in our earning asset mix contributed positively to both the net interest
margin and net interest income. Total average commercial loan balances increased $618,821,
or 60.6%. This increase is primarily due to the Prairie acquisition, which, at the
acquisition date, had $383,060 of commercial loans, plus strong double digit growth for
each of the four quarters ended March 31, 2008. The yield during the first quarter of 2008
for commercial loans of 6.54% was 126 basis points higher than the yield on investment
securities of 5.28%. Securities balances increased $35,892 or 5.9%. Total average
commercial loans represented 54.4% of earning assets for the first quarter of 2008,
compared to 42.3% for the first quarter of 2007, evidencing the improvement in mix.
    
    A shift in funding sources positively benefited the net interest margin and net interest
income for the first quarter of 2008, as compared to the first quarter of 2007. As rates
declined, we found alternative sources of funding at lower rates. Higher costing time
deposit average balances were 41.3% of total interest bearing liabilities for the three
months ended March 31, 2008, compared to 43.5% for the quarter ended March 31, 2007.
Sources of funds other than customer time and transaction deposits, which include
repurchase agreements, Federal Home Loan Bank advances and other sources, increased from
19.4% of total interest bearing liabilities to 24.8% for the quarter ended March 31, 2008.
Average time deposit rates declined only 15 basis points from the year ago quarter, while
the rates for funding sources other than customer time and transaction accounts declined 46
basis points.
  20




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##### Table of Contents



2008
    
    
    2007Average
    
    
    Interest
    
    
    Yield/
    
    
    Average
    
    
    Interest
    
    
    Yield/For Three Months Ended March 31,
    
    Balances
    
    
    & Fees
    
    
    Cost
    
    
    Balances
    
    
    & Fees
    
    
    CostEARNING ASSETS:Short-term investments
    
    $
    4,869
    
    
    $
    38
    
    
    
    3.19
    %
    
    $
    3,576
    
    
    $
    49
    
    
    
    5.47
    %Loans held for sale
    
    
    6,617
    
    
    
    103
    
    
    
    6.22
    %
    
    
    1,607
    
    
    
    28
    
    
    
    7.01
    %Securities
    
    
    643,517
    
    
    
    8,499
    
    
    
    5.28
    %
    
    
    607,625
    
    
    
    7,851
    
    
    
    5.17
    %Regulatory Stock
    
    
    29,179
    
    
    
    376
    
    
    
    5.15
    %
    
    
    24,360
    
    
    
    346
    
    
    
    5.68
    %Loans
    
    
    2,333,059
    
    
    
    38,825
    
    
    
    6.61
    %
    
    
    1,780,249
    
    
    
    32,184
    
    
    
    7.25
    %Total earning assets
    
    
    3,017,241
    
    
    $
    47,841
    
    
    
    6.37
    %
    
    
    2,417,417
    
    
    $
    40,458
    
    
    
    6.76
    %Allowance for loan loss
    
    
    (28,030
    )
    
    
    
    
    
    
    
    
    
    
    (21,128
    )Other non-earning assets
    
    
    384,654
    
    
    
    
    
    
    
    
    
    
    
    262,496TOTAL ASSETS
    
    $
    3,373,865
    
    
    
    
    
    
    
    
    
    
    $
    2,658,785INTEREST-BEARING LIABILITIES:DepositsSavings and interest-bearing demand
    
    $
    536,124
    
    
    $
    1,246
    
    
    
    0.93
    %
    
    $
    489,480
    
    
    $
    1,102
    
    
    
    0.91
    %Money market accounts
    
    
    391,890
    
    
    
    2,777
    
    
    
    2.85
    %
    
    
    306,951
    
    
    
    3,069
    
    
    
    4.06
    %Certificates of deposit and other time
    
    
    1,127,872
    
    
    
    12,369
    
    
    
    4.41
    %
    
    
    935,064
    
    
    
    10,513
    
    
    
    4.56
    %Total interest-bearing deposits
    
    
    2,055,886
    
    
    
    16,392
    
    
    
    3.21
    %
    
    
    1,731,495
    
    
    
    14,684
    
    
    
    3.44
    %Short-term borrowings
    
    
    262,187
    
    
    
    2,166
    
    
    
    3.27
    %
    
    
    164,837
    
    
    
    2,018
    
    
    
    4.90
    %Long-term borrowings
    
    
    415,933
    
    
    
    5,015
    
    
    
    4.77
    %
    
    
    251,988
    
    
    
    2,811
    
    
    
    4.46
    %Total interest-bearing liabilities
    
    
    2,734,006
    
    
    $
    23,573
    
    
    
    3.47
    %
    
    
    2,148,320
    
    
    $
    19,513
    
    
    
    3.68
    %Non-interest bearing deposits
    
    
    272,811
    
    
    
    
    
    
    
    
    
    
    
    248,959Other noninterest-bearing liabilities and
shareholders equity
    
    
    367,048
    
    
    
    
    
    
    
    
    
    
    
    261,506TOTAL LIABILITIES AND
SHAREHOLDERS EQUITY
    
    $
    3,373,865
    
    
    
    
    
    
    
    
    
    
    $
    2,658,785Interest income/earning assets
    
    
    
    
    
    $
    47,841
    
    
    
    6.37
    %
    
    
    
    
    
    $
    40,458
    
    
    
    6.76
    %Interest expense/earning assets
    
    
    
    
    
    
    23,573
    
    
    
    3.14
    %
    
    
    
    
    
    
    19,513
    
    
    
    3.28
    %Net interest income/earning assets
    
    
    
    
    
    $
    24,268
    
    
    
    3.23
    %
    
    
    
    
    
    $
    20,945
    
    
    
    3.48
    %
    NON-INTEREST INCOME
  
    
    Trading gains in the first quarter of 2008 of $321, as well as positive mark-to-market
adjustments on free-standing derivatives of $506. During the first quarter of 2007, we did
not have any securities classified as trading or free-standing derivatives requiring
mark-to-market accounting treatment through the income statement.
    
    An increase in deposit service charges of $481, or 11.4%, to $4,699. This increase is
the result of an increase in the non-sufficient funds fee during 2007, a higher level of
activity, and the Prairie acquisition. The Chicago region contributed $223 of deposit
service charges during the first quarter of 2008.
    
    An increase in debit card interchange income of $348, or 38.9%, to $1,243. The increase
in debit card interchange income is driven by an increase in the number of checking
accounts, the Prairie acquisition, and a continued growing customer preference to debit
cards as the preferred method of payment.
    
    An increase in annuity commissions of $315, or 118.3%, to $581. This increase resulted
from changes in customer preferences, particularly in a lower interest rate environment,
coupled with increased training initiatives and more consistent sales efforts.
    
    Higher life insurance income of $229, or 55.5% to $643. The higher level of income is
due to additional purchases of bank owned life insurance during 2007, as well as the bank
owned life insurance acquired in the Prairie acquisition.
  21




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##### Table of Contents



NON-INTEREST EXPENSE
  
    
    An increase in personnel expense of $1,629, or 15.1%, which was a result of the addition
of the Chicago region, additional investments in our commercial banking line of business,
2007 pay rate increases coupled with a low rate of personnel turnover, higher health
insurance expense, and higher stock based compensation expense, partially offset by lower
severance expenses of $239. Personnel expense charged directly to the Chicago region for
the first quarter of 2008, excluding insurance benefit expense, was $871, compared to none
in 2007. Health insurance expense increased $170, or 21.4%, partially due to the addition
of the Chicago region. Stock based compensation expense increased $132, or 63.3%, due to
the adoption of SFAS No. 123(R) in 2006. The expense associated with both the 2006 and
2007 grants is now being amortized, while the first quarter of 2007s expense included only
one years grant amortization. The average number of full time equivalent employees for
the first quarter of 2008 was 859 compared to 790 for the first quarter of 2007.
    
    An increase in occupancy expense of $453, or 21.5%, of which $404 was expensed directly
to the Chicago region.
    
    An increase in forgery and fraud losses of $427, largely due to a first quarter 2008
check kiting loss of $437.
    
    An increase in loan and other real estate owned expense of $354. This increase is
attributed to higher levels of real estate owned and related expenses, coupled with
expenses incurred in connection with loan workout activities and collections expenses.
    
    An increase in intangible asset amortization of $198, which is entirely due to core
deposit and customer relationship intangible amortization expense recorded with the Prairie
acquisition.
    
    Increases in other areas are primarily due to the Prairie acquisition. These include
increases of $104, or 12.6% in equipment expense, postage and courier expenses of $190, or
24.0%, and processing expense of $208, or 40.8%. The increase in processing also includes
higher ATM processing costs, resulting from higher levels of usage.
 INCOME TAX EXPENSE
     FINANCIAL POSITION
  SECURITIES
   22




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##### Table of Contents



REGULATORY STOCK
  LOANS HELD FOR SALE
  LOANS
       23




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##### Table of Contents



March 31,
    
    
    December 31,2008
    
    
    2007Commercial, industrial and
agricultural loans
    
    $
    692,614
    
    
    $
    689,504Economic development loans and
other obligations of state and
political subdivisions
    
    
    7,020
    
    
    
    7,227Lease financing
    
    
    5,301
    
    
    
    5,291Total commercial
    
    
    704,935
    
    
    
    702,022Commercial real estateCommercial mortgages
    
    
    331,400
    
    
    
    298,151Construction and development
    
    
    629,923
    
    
    
    609,858Total commercial real estate
    
    
    961,323
    
    
    
    908,009Residential mortgages
    
    
    360,457
    
    
    
    380,429Home equity
    
    
    145,535
    
    
    
    145,403Consumer loans
    
    
    168,500
    
    
    
    175,516Total loans
    
    
    2,340,750
    
    
    
    2,311,379Less: unearned income
    
    
    
    
    
    
    1Loans, net of unearned income
    
    $
    2,340,750
    
    
    $
    2,311,378
 ASSET QUALITY
        24




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##### Table of Contents



SUMMARY OF ALLOWANCE FOR LOAN LOSSES
 Three Months EndedMarch 31,2008
    
    
    2007Beginning Balance
    
    $
    27,261
    
    
    $
    21,155Loans charged off
    
    
    (2,753
    )
    
    
    (1,073
    )Recoveries
    
    
    448
    
    
    
    348Provision for loan losses
    
    
    3,634
    
    
    
    735Ending Balance
    
    $
    28,590
    
    
    $
    21,165Percent of total loans
    
    
    1.22
    %
    
    
    1.18
    %Annualized % of average loans:Net charge-offs
    
    
    0.40
    %
    
    
    0.17
    %Provision for loan losses
    
    
    0.63
    %
    
    
    0.17
    %
      
    
    Our loan portfolio, with the exception of the one floor plan loss, performed much as we
had expected at the beginning of the first quarter. We continue to believe that the
residential builder portfolio that accounted for the increase to non-performing loans in
both the fourth quarter of 2007 and first quarter of 2008 is adequately secured and should
not result in significant charge-offs;
    
    The risk in our non-performing assets is granular, as only three non-performing loans
exceed $1,000;
    
    We have analyzed the remainder of our floor plan portfolio, which is not a major line of
business for us, and do not believe that we have a significant risk of loss in the
remaining portfolio;
    
    The performance of our other portfolios, including commercial real estate, remains
strong and our level of net charge-offs outside of the floor plan loss was low to moderate
at 16 basis points for the first quarter of 2008; and
    
    We are not seeing a material impact on our loan losses related to our residential
mortgage portfolio, since we did not underwrite a subprime mortgage portfolio. Net losses
during the first quarter for both the residential mortgage and home equity portfolios were
three basis points.
  25




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##### Table of Contents



March 31,
    
    
    December 31,2008
    
    
    2007Nonaccrual loans
    
    $
    27,517
    
    
    $
    18,54990 days or more past due loans
    
    
    2,544
    
    
    
    4,118Total non-performing loans (1)
    
    
    30,061
    
    
    
    22,667Other real estate owned
    
    
    3,267
    
    
    
    2,923Total non-performing assets
    
    $
    33,328
    
    
    $
    25,590Ratios:Non-performing Loans to Loans
    
    
    1.28
    %
    
    
    0.98
    %Non-performing Assets to Loans and Other Real Estate Owned
    
    
    1.42
    %
    
    
    1.11
    %Allowance for Loan Losses to Non-performing Loans
    
    
    95.11
    %
    
    
    120.27
    %
 (1)
    
    Includes non-performing loans classified as loans held for sale DEPOSITS
    SHORT-TERM BORROWINGS
   LONG-TERM BORROWINGS
   CAPITAL EXPENDITURES
  OFF-BALANCE SHEET ARRANGEMENTS AND AGGREGATE CONTRACTUAL OBLIGATIONS
   26




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##### Table of Contents



CAPITAL RESOURCES AND LIQUIDITY
  Regulatory Guidelines
    
    
    ActualMinimum
    
    
    Well-
    
    
    March 31,
    
    
    December 31,Requirements
    
    
    Capitalized
    
    
    2008
    
    
    2007Integra Bank Corporation:Total Capital (to Risk-Weighted Assets)
    
    
    8.00
    %
    
    
    N/A
    
    
    
    11.51
    %
    
    
    11.52
    %Tier 1 Capital (to Risk-Weighted Assets)
    
    
    4.00
    %
    
    
    N/A
    
    
    
    9.37
    %
    
    
    9.34
    %Tier 1 Capital (to Average Assets)
    
    
    4.00
    %
    
    
    N/A
    
    
    
    7.86
    %
    
    
    7.81
    %Integra Bank N.A.:Total Capital (to Risk-Weighted Assets)
    
    
    8.00
    %
    
    
    10.00
    %
    
    
    11.84
    %
    
    
    11.89
    %Tier 1 Capital (to Risk-Weighted Assets)
    
    
    4.00
    %
    
    
    6.00
    %
    
    
    10.77
    %
    
    
    10.86
    %Tier 1 Capital (to Average Assets)
    
    
    4.00
    %
    
    
    5.00
    %
    
    
    9.05
    %
    
    
    9.08
    %
     
 Item 3. Quantitative and Qualitative Disclosures about Market Risk
    27




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##### Table of Contents



Earnings at Risk (EAR).
  Immediate Rate Shock
    
    March 31, 2008
    
    
    December 31, 2007+200 basis points
    
    
    -2.10
    %
    
    
    -1.44
    %+100 basis points
    
    
    -0.84
    %
    
    
    -0.67
    %-100 basis points
    
    
    -2.10
    %
    
    
    0.02
    %-200 basis points
    
    
    -7.26
    %
    
    
    -2.55
    %
  Economic Value of Equity (EVE).
    28




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##### Table of Contents



Estimated Change in EVE from the Base Interest Rate Scenario
 Immediate Rate Shock
    
    March 31, 2008
    
    
    December 31, 2007+200 basis points
    
    
    -4.18
    %
    
    
    -4.32
    %+100 basis points
    
    
    -1.52
    %
    
    
    -1.95
    %-100 basis points
    
    
    -0.53
    %
    
    
    0.35
    %-200 basis points
    
    
    -3.57
    %
    
    
    -0.91
    %
  
 Item 4: Controls and Procedures
 Rules 13a-15(e)
   29




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##### Table of Contents



PART II  OTHER INFORMATION
 
 Item 1. LEGAL PROCEEDINGS
  
 Item 1A. RISK FACTORS
  
 Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
  
 Item 3. DEFAULTS UPON SENIOR SECURITIES
  
 Item 4. SUBMISSIONS OF MATTERS TO A VOTE OF SECURITY HOLDERS
  
 Item 5. OTHER INFORMATION
  
 Item 6. EXHIBITS
  31.1
    
    Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of Chief Executive Officer31.2
    
    Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of Chief Financial Officer32
    
    Certification of Chief Executive Officer and Chief Financial Officer
  30




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##### Table of Contents



SIGNATURES
  INTEGRA BANK CORPORATIONBy
    
    /s/ Michael T. Vea

Chairman of the Board, President,

and 
Chief Executive OfficerMay 8, 2008/s/ Martin M. Zorn

Chief Financial Officer, 
Executive Vice President  Finance and RiskMay 8, 2008
  31




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##### Table of Contents



EXHIBIT INDEX
 ExhibitNo.
    
    Description31.1
    
    Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of Chief Executive Officer31.2
    
    Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of Chief Financial Officer32
    
    Certification of Chief Executive Officer and Chief Financial Officer
  32