|                                                               |
|---------------------------------------------------------------|
|                                                               |  |
| Indiana                                                       | 35-1544218 |
| (State or other jurisdiction ofincorporation or organization) | (I.R.S. Employer Identification No.) |

|                                          |
|------------------------------------------|
|                                          |  |
| 200 East JacksonMuncie, Indiana          |  47305-2814 |
| (Address of principal executive offices) | (Zip Code) |

|                                             |
|---------------------------------------------|
|                                             |  |
| Title of Each Class                         | Name of each exchange on which registered |
| Common Stock, $0.125 stated value per share | The NASDAQ Stock Market |

|                                               |
|-----------------------------------------------|
|                                               |  |
| Documents                                     | Part of Form 10-K into which incorporated |
| Portions of the Registrant’s Definitive | Part III (Items 10 through 14) |
| Proxy Statement for Annual Meeting of         |   |
| Shareholders to be held May 9, 2013           |   |

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|                                                |
|------------------------------------------------|
|                                                |  |  |  |
| Five-Year Summary of Selected Financial Data   | 3 |
| Statement Regarding Forward-Looking Statements | 4 |
|                                           |   |   |   |
| PART I                                         |   |   |   |
|                                           | Item 1. | Business | 5 |
|                                           | Item 1A. | Risk Factors | 22 |
|                                           | Item 1B. | Unresolved Staff Comments | 25 |
|                                           | Item 2. | Properties | 26 |
|                                           | Item 3. | Legal Proceedings | 26 |
|                                           | Item 4. | Mine Safety Disclosures | 26 |
|                                           |   | Supplemental Information - Executive Officers of the Registrant | 27 |
|                                           |   |   |   |
| PART II                                        |   |   |   |
|                                           | Item 5. | Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | 28 |
|                                           | Item 6. | Selected Financial Data | 30 |
|                                           | Item 7. | Management's Discussion and Analysis of Financial Condition and Results of Operations | 31 |
|                                           | Item 7A. | Quantitative and Qualitative Disclosure about Market Risk | 44 |
|                                           | Item 8. | Financial Statements and Supplementary Data | 45 |
|                                           | Item 9. | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure | 95 |
|                                           | Item 9A. | Controls and Procedures | 95 |
|                                           | Item 9B. | Other Information | 96 |
|                                           |   |   |   |
| PART III                                       |   |   |   |
|                                           | Item 10. | Directors, Executive Officers and Corporate Governance | 97 |
|                                           | Item 11. | Executive Compensation | 97 |
|                                           | Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 97 |
|                                           | Item 13. | Certain Relationships, Related Transactions and Director Independence | 97 |
|                                           | Item 14. | Principal Accountant Fees and Services | 97 |
|                                           |   |   |   |
| PART IV                                        |   |   |   |
|                                           | Item 15. | Exhibits and Financial Statement Schedules | 98 |

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|                                                                      |
|----------------------------------------------------------------------|
|                                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| (Dollars in Thousands, Except Share Data)                            | 2012 |  | 2011 |  | 2010 |   | 2009 |  | 2008 |
| Operations (1) (2)                                              |   |  |   |  |   |   |   |  |   |
| Net Interest Income Fully Taxable Equivalent (FTE) Basis             | $ | 158,081 |  |  | $ | 149,114 |  |  | $ | 149,434 |  |  | $ | 159,068 |  |   | $ | 133,083 |  |
| Less Tax Equivalent Adjustment                                       | 5,745 |  |  | 5,759 |  |  | 5,865 |  |  | 5,722 |  |   | 3,699 |  |
| Net Interest Income                                                  | 152,336 |  |  | 143,355 |  |  | 143,569 |  |  | 153,346 |  |   | 129,384 |  |
| Provision for Loan Losses                                            | 18,534 |  |  | 22,630 |  |  | 46,483 |  |  | 122,176 |  |   | 28,238 |  |
| Net Interest Income After Provision for Loan Losses                  | 133,802 |  |  | 120,725 |  |  | 97,086 |  |  | 31,170 |  |   | 101,146 |  |
| Total Other Income                                                   | 64,302 |  |  | 49,120 |  |  | 48,544 |  |  | 51,201 |  |   | 36,367 |  |
| Total Other Expenses                                                 | 137,115 |  |  | 135,938 |  |  | 142,311 |  |  | 151,558 |  |   | 108,792 |  |
| Income (Loss) Before Income Tax Expense (Benefit)                    | 60,989 |  |  | 33,907 |  |  | 3,319 |  |  | (69,187 | ) |  | 28,721 |  |
| Income Tax Expense (Benefit)                                         | 15,867 |  |  | 8,655 |  |  | (3,590 | ) |  | (28,424 | ) |  | 8,083 |  |
| Net Income (Loss)                                                    | 45,122 |  |  | 25,252 |  |  | 6,909 |  |  | (40,763 | ) |  | 20,638 |  |
| Gain on Exchange of Preferred Stock to Trust Preferred Debt          |   |  |   |  |  | 11,353 |  |  |   |   |   |
| Loss on CPP Unamortized Discount                                     |  |  |  | (1,401 | ) |  | (1,301 | ) |  |   |   |   |
| Loss on Extinguishment of Trust Preferred Securities                 |  |  |  | (10,857 | ) |  |   |  |   |   |   |
| Preferred Stock Dividends and Discount Accretion                     | (4,539 | ) |  | (3,981 | ) |  | (5,239 | ) |  | (4,979 | ) |  |   |
| Net Income (Loss) Available to Common Stockholders                   | $ | 40,583 |  |  | $ | 9,013 |  |  | $ | 11,722 |  |  | $ | (45,742 | ) |  | $ | 20,638 |  |
|                                                                 |   |   |   |   |   |   |   |   |   |
| Per Share Data                                                       |   |  |   |  |   |  |   |  |   |
| Basic Net Income (Loss) Available to Common Stockholders             | $ | 1.42 |  |  | $ | 0.34 |  |  | $ | 0.48 |  |  | $ | (2.17 | ) |  | $ | 1.14 |  |
| Diluted Net Income (Loss) Available to Common Stockholders           | 1.41 |  |  | 0.34 |  |  | 0.48 |  |  | (2.17 | ) |  | 1.14 |  |
| Cash Dividends Paid - Common                                         | 0.10 |  |  | 0.04 |  |  | 0.04 |  |  | 0.47 |  |   | 0.92 |  |
| December 31 Book Value - Common                                      | 16.08 |  |  | 14.83 |  |  | 15.11 |  |  | 16.55 |  |   | 18.69 |  |
| December 31 Tangible Book Value - Common                             | 10.95 |  |  | 9.64 |  |  | 9.21 |  |  | 9.25 |  |   | 10.93 |  |
| December 31 Market Value (Bid Price) - Common                        | 14.84 |  |  | 8.47 |  |  | 8.86 |  |  | 5.94 |  |   | 22.21 |  |
|                                                                      |  |  |  |  |  |  |  |  |  |
| Average Balances (1) (2)                                        |   |  |   |  |   |  |   |   |   |
| Total Assets                                                         | $ | 4,245,996 |  |  | $ | 4,143,850 |  |  | $ | 4,271,715 |  |  | $ | 4,674,590 |  |   | $ | 3,811,166 |  |
| Total Loans (3)                                                 | 2,819,816 |  |  | 2,748,684 |  |  | 3,050,850 |  |  | 3,546,316 |  |   | 3,002,628 |  |
| Total Deposits                                                       | 3,263,020 |  |  | 3,175,762 |  |  | 3,337,747 |  |  | 3,603,509 |  |   | 2,902,902 |  |
| Securities Sold Under Repurchase Agreements (long-term portion)      | 10,000 |  |  | 12,773 |  |  | 24,250 |  |  | 24,250 |  |   | 34,250 |  |
| Total Federal Home Loan Bank Advances                                | 113,730 |  |  | 110,729 |  |  | 107,753 |  |  | 243,105 |  |   | 237,791 |  |
| Total Subordinated Debentures, Revolving Credit Lines and Term Loans | 109,339 |  |  | 133,673 |  |  | 126,650 |  |  | 110,826 |  |   | 107,752 |  |
| Total Stockholders' Equity                                           | 535,497 |  |  | 478,440 |  |  | 470,379 |  |  | 477,148 |  |   | 349,594 |  |
|                                                                 |   |   |   |   |   |   |   |   |   |
| Year-End Balances (1) (2)                                       |   |  |   |  |   |  |   |   |   |
| Total Assets                                                         | $ | 4,304,821 |  |  | $ | 4,173,076 |  |  | $ | 4,170,848 |  |  | $ | 4,480,952 |  |   | $ | 4,784,155 |  |
| Total Loans (3)                                                 | 2,924,509 |  |  | 2,731,279 |  |  | 2,857,152 |  |  | 3,277,824 |  |   | 3,726,247 |  |
| Total Deposits                                                       | 3,346,383 |  |  | 3,134,655 |  |  | 3,268,880 |  |  | 3,536,536 |  |   | 3,718,811 |  |
| Securities Sold Under Repurchase Agreements (long-term portion)      | 10,000 |  |  | 10,000 |  |  | 24,250 |  |  | 24,250 |  |   | 34,250 |  |
| Total Federal Home Loan Bank Advances                                | 94,238 |  |  | 138,095 |  |  | 82,684 |  |  | 129,749 |  |   | 360,217 |  |
| Total Subordinated Debentures, Revolving Credit Lines and Term Loans | 112,161 |  |  | 194,974 |  |  | 226,440 |  |  | 194,790 |  |   | 135,826 |  |
| Total Stockholders' Equity                                           | 552,236 |  |  | 514,467 |  |  | 454,408 |  |  | 463,785 |  |   | 395,903 |  |
|                                                                 |   |   |   |   |   |   |   |   |   |
| Financial Ratios (1) (2)                                        |   |  |   |  |   |  |   |   |   |
| Return on Average Assets                                             | 0.96 | % |  | 0.22 | % |  | 0.27 | % |  | (0.98 | )% |  | 0.54 | % |
| Return on Average Stockholders' Equity                               | 7.58 |  |  | 1.88 |  |  | 2.49 |  |  | (9.59 | ) |  | 5.90 |  |
| Average Earning Assets to Total Assets                               | 90.28 |  |  | 90.35 |  |  | 90.42 |  |  | 94.74 |  |   | 72.39 |  |
| Allowance for Loan Losses as % of Total Loans                        | 2.37 |  |  | 2.60 |  |  | 2.90 |  |  | 2.81 |  |   | 1.33 |  |
| Dividend Payout Ratio                                                | 7.09 |  |  | 11.76 |  |  | 8.33 |  |  | n/m |  | (4)  | 80.70 |  |
| Average Stockholders' Equity to Average Assets                       | 12.61 |  |  | 11.55 |  |  | 11.01 |  |  | 10.21 |  |   | 9.17 |  |
| Tax Equivalent Yield on Earning Assets                               | 4.74 |  |  | 4.99 |  |  | 5.32 |  |  | 5.56 |  |   | 6.44 |  |
| Cost of Supporting Liabilities                                       | 0.62 |  |  | 1.01 |  |  | 1.45 |  |  | 1.82 |  |   | 2.60 |  |
| Net Interest Margin on Earning Assets                                | 4.12 |  |  | 3.98 |  |  | 3.87 |  |  | 3.74 |  |   | 3.84 |  |

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|         |                                                                           |
|---------|---------------------------------------------------------------------------|
| • | statements of the Corporation’s goals, intentions and expectations; |

|         |                                                                                   |
|---------|-----------------------------------------------------------------------------------|
| • | statements regarding the Corporation’s business plan and growth strategies; |

|         |                                                                                                       |
|---------|-------------------------------------------------------------------------------------------------------|
| • | statements regarding the asset quality of the Corporation’s loan and investment portfolios; and |

|         |                                                                           |
|---------|---------------------------------------------------------------------------|
| • | estimates of the Corporation’s risks and future costs and benefits. |

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|         |                                                                                                                                                                                                                                                                                          |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | acquiring direct or indirect control or ownership of any voting shares of any bank or bank holding company if, after such acquisition, the bank holding company will directly or indirectly own or control more than 5 percent of the voting shares of the bank or bank holding company; |

|         |                                                                |
|---------|----------------------------------------------------------------|
| • | merging or consolidating with another bank holding company; or |

|         |                                                        |
|---------|--------------------------------------------------------|
| • | acquiring substantially all of the assets of any bank. |

|                                 |
|---------------------------------|
|                                 |  |  |  |  |  |
|                            | Corporation |  | Regulatory Minimum Requirement |
| Tier 1 risk-based capital ratio | 14.15 | % |  | 4.00 | % |
| Total risk-based capital ratio  | 16.34 | % |  | 8.00 | % |

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|         |                                                                                                                                                                                    |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | increase the cost of operations due to greater regulatory oversight, supervision and examination of banks and bank holding companies, including higher deposit insurance premiums; |

|         |                                                                                                                                                                                                   |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | limit the Corporation’s ability to raise additional capital through the use of trust preferred securities as new issuances of these securities may no longer be included as Tier 1 capital; |

|         |                                                                                                                                       |
|---------|---------------------------------------------------------------------------------------------------------------------------------------|
| • | reduce the flexibility to generate or originate certain revenue-producing assets based on increased regulatory capital standards; and |

|         |                                                                                                                                          |
|---------|------------------------------------------------------------------------------------------------------------------------------------------|
| • | limit the ability to expand consumer product and service offerings due to anticipated stricter consumer protection laws and regulations. |

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|         |                                                                                                                                                                   |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | a prohibition on personal loans made or arranged by the issuer to its directors and executive officers (except for loans made by a bank subject to Regulation O); |

|         |                                                        |
|---------|--------------------------------------------------------|
| • | independence requirements for audit committee members; |

|         |                                                 |
|---------|-------------------------------------------------|
| • | independence requirements for company auditors; |

|         |                                                                                                                                      |
|---------|--------------------------------------------------------------------------------------------------------------------------------------|
| • | certification of financial statements on Forms 10-K and 10-Q reports by the chief executive officer and the chief financial officer; |

|         |                                                                                                                                                                                                                                                                                                                                                        |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | the forfeiture by the chief executive officer and chief financial officer of bonuses or other incentive-based compensation and profits from the sale of an issuer’s securities by such officers in the twelve-month period following initial publication of any financial statements that later require restatement due to corporate misconduct; |

|         |                                               |
|---------|-----------------------------------------------|
| • | disclosure of off-balance sheet transactions; |

|         |                                                                   |
|---------|-------------------------------------------------------------------|
| • | two-business day filing requirements for insiders filing Form 4s; |

|         |                                                                                                                     |
|---------|---------------------------------------------------------------------------------------------------------------------|
| • | disclosure of a code of ethics for financial officers and filing a Form 8-K for a change in or waiver of such code; |

|         |                                                                                                            |
|---------|------------------------------------------------------------------------------------------------------------|
| • | the reporting of securities violations “up the ladder” by both in-house and outside attorneys; |

|         |                                                                                           |
|---------|-------------------------------------------------------------------------------------------|
| • | restrictions on the use of non-GAAP financial measures in press releases and SEC filings; |

|         |                                                           |
|---------|-----------------------------------------------------------|
| • | the formation of a public accounting oversight board; and |

|         |                                                                         |
|---------|-------------------------------------------------------------------------|
| • | various increased criminal penalties for violations of securities laws. |

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|                                                      |
|------------------------------------------------------|
|                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                 | Average Balance |  | Interest Income /Expense |  | AverageRate |  | Average Balance |  | Interest Income /Expense |  | AverageRate |  | Average Balance |  | Interest Income /Expense |  | AverageRate |
| (Dollars in Thousands)                               | 2012 |  | 2011 |  | 2010 |
| Assets:                                              |   |  |  |  |   |  |   |  |   |  |   |  |   |  |   |  |   |
| Federal Funds Sold                                   |  |  |  |  |  |  |  |  |  | $ | 3,270 |  |  | $ | 3 |  |  | 0.1 | % |  | $ | 21,524 |  |  | $ | 26 |  |  | 0.1 | % |
| Interest-bearing Deposits                            | $ | 57,842 |  |  | $ | 100 |  |  | 0.2 | % |  | 69,030 |  |  | 282 |  |  | 0.4 |  |  | 106,820 |  |  | 381 |  |  | 0.4 |  |
| Federal Reserve and Federal Home Loan Bank Stock     | 32,819 |  |  | 1,408 |  |  | 4.3 |  |  | 32,396 |  |  | 1,319 |  |  | 4.1 |  |  | 36,338 |  |  | 1,252 |  |  | 3.4 |  |
| Securities: (1)                                      |   |  |  |  |  |  |   |  |   |  |   |  |   |  |   |  |   |
| Taxable                                              | 670,973 |  |  | 17,027 |  |  | 2.5 |  |  | 648,167 |  |  | 19,230 |  |  | 3.0 |  |  | 399,721 |  |  | 12,957 |  |  | 3.2 |  |
| Tax-Exempt (2)                                       | 251,724 |  |  | 15,675 |  |  | 6.2 |  |  | 242,480 |  |  | 15,642 |  |  | 6.5 |  |  | 247,240 |  |  | 15,965 |  |  | 6.5 |  |
| Total Securities                                     | 922,697 |  |  | 32,702 |  |  | 3.5 |  |  | 890,647 |  |  | 34,872 |  |  | 3.9 |  |  | 646,961 |  |  | 28,922 |  |  | 4.5 |  |
| Mortgage Loans Held for Sale                         | 20,648 |  |  | 1,024 |  |  | 5.0 |  |  | 9,322 |  |  | 554 |  |  | 5.9 |  |  | 11,878 |  |  | 684 |  |  | 5.8 |  |
| Loans: (3)                                           |  |  |  |  |   |  |   |  |   |  |   |  |   |  |   |  |   |
| Commercial                                           | 2,166,238 |  |  | 114,078 |  |  | 5.3 |  |  | 2,102,933 |  |  | 114,079 |  |  | 5.4 |  |  | 2,288,883 |  |  | 130,276 |  |  | 5.7 |  |
| Real Estate Mortgage                                 | 293,384 |  |  | 13,848 |  |  | 4.7 |  |  | 306,567 |  |  | 15,810 |  |  | 5.2 |  |  | 350,646 |  |  | 19,473 |  |  | 5.6 |  |
| Installment                                          | 324,553 |  |  | 17,795 |  |  | 5.5 |  |  | 320,570 |  |  | 19,273 |  |  | 6.0 |  |  | 380,293 |  |  | 23,637 |  |  | 6.2 |  |
| Tax-Exempt (2)                                       | 14,993 |  |  | 739 |  |  | 4.9 |  |  | 9,292 |  |  | 812 |  |  | 8.7 |  |  | 19,150 |  |  | 792 |  |  | 4.1 |  |
| Total Loans                                          | 2,819,816 |  |  | 147,484 |  |  | 5.2 |  |  | 2,748,684 |  |  | 150,528 |  |  | 5.5 |  |  | 3,050,850 |  |  | 174,862 |  |  | 5.7 |  |
| Total Earning Assets                                 | 3,833,174 |  |  | 181,694 |  |  | 4.7 | % |  | 3,744,027 |  |  | 187,004 |  |  | 5.0 | % |  | 3,862,493 |  |  | 205,443 |  |  | 5.3 | % |
| Net Unrealized Gain on Securities Available for Sale | 16,116 |  |  |  |  |   |  | 9,225 |  |  |   |  |   |  | 14,245 |  |  |   |  |   |
| Allowance for Loan Losses                            | (71,038 | ) |  |  |  |   |  | (78,500 | ) |  |   |  |   |  | (87,058 | ) |  |   |  |   |
| Cash and Due from Banks                              | 66,109 |  |  |  |  |   |  | 62,659 |  |  |   |  |   |  | 56,635 |  |  |   |  |   |
| Premises and Equipment                               | 51,692 |  |  |  |  |   |  | 51,895 |  |  |   |  |   |  | 53,870 |  |  |   |  |   |
| Other Assets                                         | 349,943 |  |  |  |  |   |  | 354,544 |  |  |   |  |   |  | 371,530 |  |  |   |  |   |
| Total Assets                                         | $ | 4,245,996 |  |  |   |  |   |  | $ | 4,143,850 |  |  |   |  |   |  | $ | 4,271,715 |  |  |   |  |   |
| Liabilities:                                         |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |
| Interest-bearing Deposits:                           |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |
| NOW Accounts                                         | $ | 814,831 |  |  | $ | 1,007 |  |  | 0.1 | % |  | $ | 774,593 |  |  | $ | 1,453 |  |  | 0.2 | % |  | $ | 755,793 |  |  | $ | 3,300 |  |  | 0.4 | % |
| Money Market Deposit Accounts                        | 501,537 |  |  | 1,370 |  |  | 0.3 |  |  | 469,621 |  |  | 1,557 |  |  | 0.3 |  |  | 467,313 |  |  | 2,520 |  |  | 0.5 |  |
| Savings  Deposits                          | 327,644 |  |  | 528 |  |  | 0.2 |  |  | 297,073 |  |  | 668 |  |  | 0.2 |  |  | 285,760 |  |  | 812 |  |  | 0.3 |  |
| Certificates and Other Time Deposits                 | 935,713 |  |  | 11,895 |  |  | 1.3 |  |  | 1,032,781 |  |  | 18,603 |  |  | 1.8 |  |  | 1,295,367 |  |  | 33,244 |  |  | 2.6 |  |
| Total Interest-bearing Deposits                      | 2,579,725 |  |  | 14,800 |  |  | 0.6 |  |  | 2,574,068 |  |  | 22,281 |  |  | 0.9 |  |  | 2,804,233 |  |  | 39,876 |  |  | 1.4 |  |
| Borrowings                                           | 411,915 |  |  | 8,813 |  |  | 2.1 |  |  | 455,135 |  |  | 15,609 |  |  | 3.4 |  |  | 427,242 |  |  | 16,133 |  |  | 3.8 |  |
| Total Interest-bearing Liabilities                   | 2,991,640 |  |  | 23,613 |  |  | 0.8 |  |  | 3,029,203 |  |  | 37,890 |  |  | 1.3 |  |  | 3,231,475 |  |  | 56,009 |  |  | 1.7 |  |
| Noninterest-bearing Deposits                         | 683,295 |  |  |   |  |   |  | 601,694 |  |  |   |  |   |  | 533,514 |  |  |   |  |   |
| Other Liabilities                                    | 35,564 |  |  |   |  |   |  | 34,513 |  |  |   |  |   |  | 36,347 |  |  |   |  |   |
| Total Liabilities                                    | 3,710,499 |  |  |   |  |   |  | 3,665,410 |  |  |   |  |   |  | 3,801,336 |  |  |   |  |   |
| Stockholders' Equity                                 | 535,497 |  |  |   |  |   |  | 478,440 |  |  |   |  |   |  | 470,379 |  |  |   |  |   |
| Total Liabilities and Stockholders' Equity           | $ | 4,245,996 |  |  | 23,613 |  |  | 0.6 |  |  | $ | 4,143,850 |  |  | 37,890 |  |  | 1.0 |  |  | $ | 4,271,715 |  |  | 56,009 |  |  | 1.5 |  |
| Net Interest Income                                  |   |  | $ | 158,081 |  |  |   |  |   |  | $ | 149,114 |  |  |   |  |   |  | $ | 149,434 |  |  |   |
| Net Interest Margin                                  |   |  |   |  | 4.1 | % |  |   |  |   |  | 4.0 | % |  |   |  |   |  | 3.9 | % |

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|                                                                               | 2012 Compared to 2011Increase (Decrease) Due To |  | 2011 Compared to 2010Increase (Decrease) Due To |  | 2010 Compared to 2009Increase (Decrease) Due To |
| (Dollars in Thousands, Fully Taxable Equivalent Basis)                             | Volume |  | Rate |  | Total |  | Volume |  | Rate |  | Total |  | Volume |  | Rate |  | Total |
| Interest Income:                                                                   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |
| Federal Funds Sold                                                                 | $ | (3 | ) |  |  |  |  | $ | (3 | ) |  | $ | (18 | ) |  | $ | (5 | ) |  | $ | (23 | ) |  | $ | (73 | ) |  | $ | (19 | ) |  | $ | (92 | ) |
| Interest-bearing Deposits                                                          | (40 | ) |  | (142 | ) |  | (182 | ) |  | (149 | ) |  | 50 |  |  | (99 | ) |  | 119 |  |  | (104 | ) |  | 15 |  |
| Federal Reserve and Federal Home Loan Bank Stock                                   | 17 |  |  | 72 |  |  | 89 |  |  | (145 | ) |  | 212 |  |  | 67 |  |  | 32 |  |  | (159 | ) |  | (127 | ) |
| Securities                                                                         | 1,222 |  |  | (3,392 | ) |  | (2,170 | ) |  | 9,877 |  |  | (3,927 | ) |  | 5,950 |  |  | 6,686 |  |  | (4,849 | ) |  | 1,837 |  |
| Mortgage Loans Held for Sale                                                       | 575 |  |  | (105 | ) |  | 470 |  |  | (151 | ) |  | 21 |  |  | (130 | ) |  | (136 | ) |  | (34 | ) |  | (170 | ) |
| Loans                                                                              | 3,226 |  |  | (6,740 | ) |  | (3,514 | ) |  | (16,643 | ) |  | (7,561 | ) |  | (24,204 | ) |  | (28,329 | ) |  | (3,852 | ) |  | (32,181 | ) |
| Totals                                                                             | 4,997 |  |  | (10,307 | ) |  | (5,310 | ) |  | (7,229 | ) |  | (11,210 | ) |  | (18,439 | ) |  | (21,701 | ) |  | (9,017 | ) |  | (30,718 | ) |
| Interest Expense:                                                                  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |
| NOW Accounts                                                                       | 72 |  |  | (518 | ) |  | (446 | ) |  | 80 |  |  | (1,927 | ) |  | (1,847 | ) |  | 274 |  |  | (580 | ) |  | (306 | ) |
| Money Market Deposit Accounts                                                      | 101 |  |  | (288 | ) |  | (187 | ) |  | 12 |  |  | (975 | ) |  | (963 | ) |  | 275 |  |  | (1,305 | ) |  | (1,030 | ) |
| Savings Deposits                                                                   | 64 |  |  | (204 | ) |  | (140 | ) |  | 31 |  |  | (175 | ) |  | (144 | ) |  | (60 | ) |  | (347 | ) |  | (407 | ) |
| Certificates and Other Time Deposits                                               | (1,624 | ) |  | (5,084 | ) |  | (6,708 | ) |  | (5,926 | ) |  | (8,715 | ) |  | (14,641 | ) |  | (10,619 | ) |  | (6,153 | ) |  | (16,772 | ) |
| Borrowings                                                                         | (1,370 | ) |  | (5,426 | ) |  | (6,796 | ) |  | 1,013 |  |  | (1,537 | ) |  | (524 | ) |  | (5,050 | ) |  | 2,481 |  |  | (2,569 | ) |
| Totals                                                                             | (2,757 | ) |  | (11,520 | ) |  | (14,277 | ) |  | (4,790 | ) |  | (13,329 | ) |  | (18,119 | ) |  | (15,180 | ) |  | (5,904 | ) |  | (21,084 | ) |
| Change in Net Interest Income (Fully Taxable Equivalent Basis)                     | $ | 7,754 |  |  | $ | 1,213 |  |  | 8,967 |  |  | $ | (2,439 | ) |  | $ | 2,119 |  |  | (320 | ) |  | $ | (6,521 | ) |  | $ | (3,113 | ) |  | (9,634 | ) |
| Tax Equivalent Adjustment Using Marginal Rate of 35% for 2012, 2011, and 2010 |   |  |   |  | 14 |  |  |   |  |   |  | 106 |  |  |   |  |   |  | (143 | ) |
| Change in Net Interest Income                                                      |   |  |   |  | $ | 8,981 |  |  |   |  |   |  | $ | (214 | ) |  |   |  |   |  | $ | (9,777 | ) |

----

Table of Contents

|                                                      |
|------------------------------------------------------|
|                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| (Dollars in Thousands)                          | Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value |
| Available for sale at December 31, 2012              |   |   |   |   |   |   |   |
| U.S. Government-sponsored agency securities          | $ | 4,475 |  |   | $ | 165 |  |   |   |   | $ | 4,640 |  |
| State and municipal                                  | 148,187 |  |   | 10,025 |  |   | $ | 18 |  |   | 158,194 |  |
| U.S. Government-sponsored mortgage-backed securities | 337,631 |  |   | 10,994 |  |   | 46 |  |   | 348,579 |  |
| Corporate obligations                                | 6,105 |  |   |   |   | 5,881 |  |   | 224 |  |
| Equity securities                                    | 1,706 |  |   |   |   |   |   | 1,706 |  |
| Total available for sale                             | 498,104 |  |   | 21,184 |  |   | 5,945 |  |   | 513,343 |  |
| Held to maturity at December 31, 2012                |   |   |   |   |   |   |   |
| State and municipal                                  | 117,227 |  |   | 5,489 |  |   | 1 |  |   | 122,715 |  |
| U.S. Government-sponsored mortgage-backed securities | 243,793 |  |   | 11,681 |  |   | 15 |  |   | 255,459 |  |
| Total held to maturity                               | 361,020 |  |   | 17,170 |  |   | 16 |  |   | 378,174 |  |
| Total Investment Securities                          | $ | 859,124 |  |   | $ | 38,354 |  |   | $ | 5,961 |  |   | $ | 891,517 |  |

|                                                      |
|------------------------------------------------------|
|                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| (Dollars in Thousands)                          | Amortized Cost |   | Gross Unrealized Gains |   | Gross Unrealized Losses |   | Fair Value |
| Available for sale at December 31, 2011              |   |   |   |   |   |   |   |
| U.S. Government-sponsored agency securities          | $ | 99 |  |   | $ | 18 |  |   |   |   | $ | 117 |  |
| State and municipal                                  | 136,857 |  |   | 10,496 |  |   |   |  |   | 147,353 |  |
| U.S. Government-sponsored mortgage-backed securities | 358,928 |  |   | 10,086 |  |   | $ | 16 |  |   | 368,998 |  |
| Corporate obligations                                | 5,765 |  |   |   |   | 5,572 |  |   | 193 |  |
| Equity securities                                    | 1,830 |  |   |   |   |   |   | 1,830 |  |
| Total available for sale                             | 503,479 |  |   | 20,600 |  |   | 5,588 |  |   | 518,491 |  |
| Held to maturity at December 31, 2011                |   |   |   |   |   |   |   |
| State and municipal                                  | 120,171 |  |   | 3,785 |  |   |   |  |   | 123,956 |  |
| U.S. Government-sponsored mortgage-backed securities | 307,738 |  |   | 10,775 |  |   |   |  |   | 318,513 |  |
| Total held to maturity                               | 427,909 |  |   | 14,560 |  |   |   |  |   | 442,469 |  |
| Total Investment Securities                          | $ | 931,388 |  |   | $ | 35,160 |  |   | $ | 5,588 |  |   | $ | 960,960 |  |

|                                                      |
|------------------------------------------------------|
|                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  (Dollars in Thousands)                         | Amortized Cost |   | Gross Unrealized Gains |   | Gross Unrealized Losses |   | Fair Value |
| Available for sale at December 31, 2010              |   |   |   |   |   |   |   |
| U.S. Government-sponsored agency securities          | $ | 600 |  |   | $ | 16 |  |   |   |   | $ | 616 |  |
| State and municipal                                  | 233,622 |  |   | 7,108 |  |   | $ | 740 |  |   | 239,990 |  |
| U.S. Government-sponsored mortgage-backed securities | 293,311 |  |   | 4,293 |  |   | 2,287 |  |   | 295,317 |  |
| Corporate obligations                                | 5,856 |  |   |   |  |   | 5,674 |  |   | 182 |  |
| Equity securities                                    | 3,265 |  |   |   |   |   |   | 3,265 |  |
| Total available for sale                             | 536,654 |  |   | 11,417 |  |   | 8,701 |  |   | 539,370 |  |
| Held to maturity at December 31, 2010                |   |   |   |   |   |   |   |
| State and municipal                                  | 10,070 |  |   | 389 |  |   | 5 |  |   | 10,454 |  |
| U.S. Government-sponsored mortgage-backed securities | 277,357 |  |   | 2,064 |  |   | 3,605 |  |   | 275,816 |  |
| Total held to maturity                               | 287,427 |  |   | 2,453 |  |   | 3,610 |  |   | 286,270 |  |
| Total Investment Securities                          | $ | 824,081 |  |   | $ | 13,870 |  |   | $ | 12,311 |  |   | $ | 825,640 |  |

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Table of Contents

|                                                                  |
|------------------------------------------------------------------|
|                                                                  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                             | 2012 |  | 2011 |  | 2010 |
| (Dollars in Thousands)                                           | Cost |  | Yield |  | Cost |  | Yield |  | Cost |  | Yield |
| Federal Reserve and Federal Home Loan Bank Stock at December 31: |   |  |   |  |   |  |   |  |   |  |   |
| Federal Reserve Bank Stock                                       | $ | 13,261 |  |  | 6.0 | % |  | $ | 13,238 |  |  | 6.0 | % |  | $ | 13,522 |  |  | 6.0 | % |
| Federal Home Loan Bank Stock                                     | 19,524 |  |  | 2.0 | % |  | 18,032 |  |  | 2.0 | % |  | 20,362 |  |  | 1.6 | % |
| Total                                                            | $ | 32,785 |  |  | 3.6 | % |  | $ | 31,270 |  |  | 4.0 | % |  | $ | 33,884 |  |  | 3.3 | % |

|                                                      |
|------------------------------------------------------|
|                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                 | Within 1 Year |  | 1-5 Years |  | 5-10 Years |
| (Dollars in Thousands)                               | Amount |  | Yield (1) |  | Amount |  | Yield (1) |  | Amount |  | Yield (1) |
| Securities available for sale December 31, 2012      |   |  |   |  |   |  |   |  |   |  |   |
| U.S. Government-sponsored agency securities          |  |  |  |  | $ | 116 |  |  | 4.9 | % |  |  |  |  |
| State and municipal                                  | $ | 4,415 |  |  | 7.8 | % |  | 15,322 |  |  | 5.7 | % |  | $ | 57,442 |  |  | 5.5 | % |
| Equity securities                                    |  |  |  |  |  |  |  |  |  |  |  |
| Corporate obligations                                |  |  |  |  | 30 |  |  | 0.0 | % |  |  |  |  |
| U.S. Government-sponsored mortgage-backed securities |   |  |   |  |   |  |   |  |   |  |   |
|                                                      | $ | 4,415 |  |  | 7.8 | % |  | $ | 15,468 |  |  | 5.6 | % |  | $ | 57,442 |  |  | 5.5 | % |

|                                                      |
|------------------------------------------------------|
|                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                 | Due After Ten Years |  | Equity and U.S. Government-Sponsored Mortgage - BackedSecurities |  | Total |
|                                                 | Amount |  | Yield (1) |  | Amount |  | Yield (1) |  | Amount |  | Yield (1) |
| U.S. Government-sponsored agency securities          | $ | 4,524 |  |  | 3.5 | % |  |   |  |   |  | $ | 4,640 |  |  | 3.5 | % |
| State and municipal                                  | 81,015 |  |  | 6.0 | % |  |   |  |   |  | 158,194 |  |  | 5.8 | % |
| Equity securities                                    | 194 |  |  | 3.7 | % |  |  |  |  |  |  |  | 224 |  |  | 3.7 | % |
| Corporate obligations                                |  |  |  |  |  |  | $ | 1,706 |  |  | 6.5 | % |  | 1,706 |  |  | 6.5 | % |
| U.S. Government-sponsored mortgage-backed securities |   |  |   |  | 348,579 |  |  | 2.7 | % |  | 348,579 |  |  | 2.7 | % |
|                                                      | $ | 85,733 |  |  | 5.6 | % |  | $ | 350,285 |  |  | 2.7 | % |  | $ | 513,343 |  |  | 3.7 | % |

|                                                      |
|------------------------------------------------------|
|                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                 | Within 1 Year |  | 1-5 Years |  | 5-10 Years |
| (Dollars in Thousands)                               | Amount |  | Yield (1) |  | Amount |  | Yield (1) |  | Amount |  | Yield (1) |
| Securities held to maturity at December 31, 2012     |   |  |   |  |   |  |   |  |   |  |   |
| State and municipal                                  | $ | 2,590 |  |  | 2.2 | % |  | $ | 2,554 |  |  | 3.3 | % |  | $ | 57,811 |  |  | 6.2 | % |
| U.S. Government-sponsored mortgage-backed securities |   |  |   |  |   |  |   |  |   |  |   |
|                                                      | $ | 2,590 |  |  | 2.2 | % |  | $ | 2,554 |  |  | 3.3 | % |  | $ | 57,811 |  |  | 6.2 | % |

|                                                      |
|------------------------------------------------------|
|                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                 | Due After Ten Years |  | Equity and U.S. Government-Sponsored Mortgage - BackedSecurities |  | Total |
|                                                 | Amount |  | Yield (1) |  | Amount |  | Yield (1) |  | Amount |  | Yield (1) |
| State and municipal                                  | $ | 54,272 |  |  | 6.4 | % |  |   |  |   |  | $ | 117,227 |  |  | 6.1 | % |
| U.S. Government-sponsored mortgage-backed securities |   |  |  |  | $ | 243,793 |  |  | 3.1 | % |  | 243,793 |  |  | 3.1 | % |
|                                                      | $ | 54,272 |  |  | 6.4 | % |  | $ | 243,793 |  |  | 3.1 | % |  | $ | 361,020 |  |  | 4.1 | % |

----

Table of Contents

|                                                                  |
|------------------------------------------------------------------|
|                                                                  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                             | FairValue |  | GrossUnrealizedLosses |  | FairValue |  | GrossUnrealizedLosses |  | FairValue |  | GrossUnrealizedLosses |
| (Dollars in Thousands)                                           | Less than 12 Months |  | 12 Months or Longer |  | Total |
| Temporarily Impaired Investment Securities at December 31, 2012: |   |  |   |  |   |  |   |  |   |  |   |
| State and municipal                                              | $ | 4,524 |  |  | $ | (19 | ) |  |   |  |   |  | $ | 4,524 |  |  | $ | (19 | ) |
| U.S. Government-sponsored mortgage-backed securities             | 11,685 |  |  | (49 | ) |  | $ | 635 |  |  | $ | (12 | ) |  | 12,320 |  |  | (61 | ) |
| Corporate obligations                                            |   |  |   |  | 194 |  |  | (5,881 | ) |  | 194 |  |  | (5,881 | ) |
| Total Temporarily Impaired Investment Securities                 | $ | 16,209 |  |  | $ | (68 | ) |  | $ | 829 |  |  | $ | (5,893 | ) |  | $ | 17,038 |  |  | $ | (5,961 | ) |

|                                                                  |
|------------------------------------------------------------------|
|                                                                  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                             | FairValue |  | GrossUnrealized Losses |  | FairValue |  | GrossUnrealized Losses |  | FairValue |  | GrossUnrealized Losses |
| (Dollars in Thousands)                                           | Less than 12 Months |  | 12 Months or Longer |  | Total |
| Temporarily Impaired Investment Securities at December 31, 2011: |   |  |   |  |   |  |   |  |   |  |   |
| U.S. Government-sponsored mortgage-backed securities             | $ | 6,176 |  |  | $ | (16 | ) |  |  |  |  |   |  | $ | 6,176 |  |  | $ | (16 | ) |
| Corporate obligations                                            |   |  |   |  | $ | 163 |  |  | $ | (5,572 | ) |  | 163 |  |  | (5,572 | ) |
| Total Temporarily Impaired Investment Securities                 | $ | 6,176 |  |  | $ | (16 | ) |  | $ | 163 |  |  | $ | (5,572 | ) |  | $ | 6,339 |  |  | $ | (5,588 | ) |

|                                                                  |
|------------------------------------------------------------------|
|                                                                  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                             | 2012 |   | 2011 |   | 2010 |   | 2009 |   | 2008 |
| (Dollars in Thousands)                                           | Amount |  | % |  | Amount |  | % |  | Amount |  | % |  | Amount |  | % |  | Amount |  | % |
| Loans at December 31:                                            |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |
| Commercial and Industrial Loans                                  | $ | 622,579 |  |  | 21.5 | % |  | $ | 532,523 |  |  | 19.6 | % |  | $ | 530,322 |  |  | 18.7 | % |  | $ | 675,860 |  |  | 20.7 | % |  | $ | 904,646 |  |  | 24.3 | % |
| Agricultural Production Financing and Other Loans to Farmers     | 112,527 |  |  | 3.9 |  |  | 104,526 |  |  | 3.9 |  |  | 95,516 |  |  | 3.4 |  |  | 121,031 |  |  | 3.7 |  |  | 135,099 |  |  | 3.6 |  |
| Real Estate Loans:                                               |   |  |   |  |   |  |   |  |   |  |  |  |   |  |   |  |   |  |   |
| Construction                                                     | 98,639 |  |  | 3.4 |  |  | 81,780 |  |  | 3.0 |  |  | 106,615 |  |  | 3.8 |  |  | 158,725 |  |  | 4.9 |  |  | 252,487 |  |  | 6.8 |  |
| Commercial and Farm Land                                         | 1,266,682 |  |  | 43.6 |  |  | 1,194,230 |  |  | 44.0 |  |  | 1,229,037 |  |  | 43.3 |  |  | 1,276,164 |  |  | 39.0 |  |  | 1,230,442 |  |  | 33.1 |  |
| Residential                                                      | 473,537 |  |  | 16.3 |  |  | 481,493 |  |  | 17.7 |  |  | 522,051 |  |  | 18.4 |  |  | 621,442 |  |  | 19.0 |  |  | 806,765 |  |  | 21.7 |  |
| Home Equity                                                      | 203,406 |  |  | 7.0 |  |  | 191,631 |  |  | 7.1 |  |  | 201,969 |  |  | 7.1 |  |  | 220,142 |  |  | 6.7 |  |  | 149,480 |  |  | 4.0 |  |
| Individuals' Loans for Household and Other Personal Expenditures | 75,748 |  |  | 2.6 |  |  | 84,172 |  |  | 3.1 |  |  | 115,295 |  |  | 4.1 |  |  | 154,132 |  |  | 4.7 |  |  | 201,632 |  |  | 5.4 |  |
| Lease Financing Receivables, Net of Unearned Income              | 2,590 |  |  | 0.1 |  |  | 3,555 |  |  | 0.1 |  |  | 5,157 |  |  | 0.2 |  |  | 7,135 |  |  | 0.2 |  |  | 8,996 |  |  | 0.2 |  |
| Other Loans                                                      | 46,501 |  |  | 1.6 |  |  | 39,505 |  |  | 1.5 |  |  | 29,721 |  |  | 1.0 |  |  | 35,157 |  |  | 1.1 |  |  | 32,405 |  |  | 0.9 |  |
| Loans                                                            | 2,902,209 |  |  | 100.0 | % |  | 2,713,415 |  |  | 100.0 | % |  | 2,835,683 |  |  | 100.0 | % |  | 3,269,788 |  |  | 100.0 | % |  | 3,721,952 |  |  | 100.0 | % |
| Allowance for Loan Losses                                        | (69,366 | ) |  |   |  | (70,898 | ) |  |   |  | (82,977 | ) |  |   |  | (92,131 | ) |  |   |  | (49,543 | ) |  |   |
| Net Loans                                                        | $ | 2,832,843 |  |  |   |  | $ | 2,642,517 |  |  |   |  | $ | 2,752,706 |  |  |   |  | $ | 3,177,657 |  |  |   |  | $ | 3,672,409 |  |  |   |

----

Table of Contents

|                                                              |
|--------------------------------------------------------------|
|                                                              |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| (Dollars in Thousands)                                       | MaturingWithin 1 Year |  | Maturing1-5 Years |  | Maturing Over5 Years |  | Total |
| Commercial and Industrial Loans                              | $ | 403,463 |  |  | $ | 143,323 |  |  | $ | 75,793 |  |  | $ | 622,579 |  |
| Agricultural Production Financing and Other Loans to Farmers | 98,833 |  |  | 11,703 |  |  | 1,991 |  |  | 112,527 |  |
| Real Estate - Construction                                   | 52,768 |  |  | 43,086 |  |  | 2,785 |  |  | 98,639 |  |
| Real Estate - Commercial and Farm Land                       | 512,532 |  |  | 536,197 |  |  | 217,953 |  |  | 1,266,682 |  |
| Other Loans                                                  | 27,343 |  |  | 16,263 |  |  | 2,895 |  |  | 46,501 |  |
| Total                                                        | $ | 1,094,939 |  |  | $ | 750,572 |  |  | $ | 301,417 |  |  | $ | 2,146,928 |  |

|                                     |
|-------------------------------------|
|                                     |  |  |  |  |  |  |  |
| (Dollars in Thousands)              | Maturing1-5 Years |  | Maturing Over5 Years |
| Loans Maturing After One Year with: |  |  |   |
| Fixed Rate                          | $ | 504,583 |  |  | $ | 285,584 |  |
| Variable Rate                       | 245,989 |  |  | 15,833 |  |
| Total                               | $ | 750,572 |  |  | $ | 301,417 |  |

|                                        |
|----------------------------------------|
|                                        |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                   | December 31, |  | December 31, |  | December 31, |  | December 31, |  | December 31, |
| (Dollars in Thousands)                 | 2012 |  | 2011 |  | 2010 |  | 2009 |  | 2008 |
| Non-Performing Assets:                 |   |  |   |  |   |  |   |  |   |
| Non-accrual loans                      | $ | 53,399 |  |  | $ | 69,592 |  |  | $ | 90,591 |  |  | $ | 118,409 |  |  | $ | 87,546 |  |
| Renegotiated loans                     | 12,681 |  |  | 14,308 |  |  | 7,139 |  |  | 8,833 |  |  | 130 |  |
| Non-performing loans (NPL)             | 66,080 |  |  | 83,900 |  |  | 97,730 |  |  | 127,242 |  |  | 87,676 |  |
| Other real estate owned                | 13,263 |  |  | 16,289 |  |  | 20,927 |  |  | 14,879 |  |  | 18,458 |  |
| Non-performing assets (NPA)            | 79,343 |  |  | 100,189 |  |  | 118,657 |  |  | 142,121 |  |  | 106,134 |  |
| 90+ days delinquent and still accruing | 2,037 |  |  | 580 |  |  | 1,330 |  |  | 3,967 |  |  | 5,982 |  |
| NPAs & 90+ days delinquent         | $ | 81,380 |  |  | $ | 100,769 |  |  | $ | 119,987 |  |  | $ | 146,088 |  |  | $ | 112,116 |  |
| Impaired Loans                         | $ | 79,179 |  |  | $ | 79,775 |  |  | $ | 116,204 |  |  | $ | 178,754 |  |  | $ | 206,126 |  |

----

Table of Contents

----

Table of Contents

|                                                                                           |
|-------------------------------------------------------------------------------------------|
|                                                                                           |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| (Dollars in Thousands)                                                                    | 2012 |  | 2011 |  | 2010 |  | 2009 |  | 2008 |
| Allowance for Loans Losses:                                                               |   |  |   |  |   |  |   |  |   |
| Balance at January 1                                                                      | $ | 70,898 |  |  | $ | 82,977 |  |  | $ | 92,131 |  |  | $ | 49,543 |  |  | $ | 28,228 |  |
| Charge Offs:                                                                              |  |  |   |  |   |  |   |  |   |
| Commercial (1)                                                                            | 8,311 |  |  | 9,818 |  |  | 22,832 |  |  | 42,147 |  |  | 7,475 |  |
| Commercial Real Estate (2)                                                                | 12,322 |  |  | 29,807 |  |  | 32,823 |  |  | 34,775 |  |  | 6,580 |  |
| Consumer                                                                                  | 1,130 |  |  | 1,441 |  |  | 2,426 |  |  | 3,770 |  |  | 3,018 |  |
| Residential                                                                               | 5,475 |  |  | 7,407 |  |  | 9,437 |  |  | 8,491 |  |  | 5,536 |  |
| Finance Leases                                                                            | 34 |  |  |   |  |  | 54 |  |  | 411 |  |  | 17 |  |
| Total Charge Offs                                                                         | 27,272 |  |  | 48,473 |  |  | 67,572 |  |  | 89,594 |  |  | 22,626 |  |
| Recoveries:                                                                               |   |  |   |  |   |  |   |  |   |
| Commercial (3)                                                                            | 1,744 |  |  | 8,828 |  |  | 6,750 |  |  | 5,248 |  |  | 1,354 |  |
| Commercial Real Estate (4)                                                                | 3,652 |  |  | 2,811 |  |  | 1,420 |  |  | 993 |  |  | 3,435 |  |
| Consumer                                                                                  | 695 |  |  | 942 |  |  | 938 |  |  | 1,015 |  |  | 1,002 |  |
| Residential                                                                               | 1,113 |  |  | 1,176 |  |  | 2,827 |  |  | 701 |  |  | 1,233 |  |
| Finance Leases                                                                            | 2 |  |  | 7 |  |  |   |  |  | 9 |  |  |   |
| Total Recoveries                                                                          | 7,206 |  |  | 13,764 |  |  | 11,935 |  |  | 7,966 |  |  | 7,024 |  |
| Net Charge Offs                                                                           | 20,066 |  |  | 34,709 |  |  | 55,637 |  |  | 81,628 |  |  | 15,602 |  |
| Provisions for Loan Losses                                                                | 18,534 |  |  | 22,630 |  |  | 46,483 |  |  | 122,176 |  |  | 28,238 |  |
| Adjustment Related to Acquisition                                                         |  |  |   |  |   |  |  | 2,040 |  |  |   |
| Allowance Acquired in Acquisition                                                         |   |  |   |  |   |  |   |  |  | 8,679 |  |
| Balance at December 31                                                                    | $ | 69,366 |  |  | $ | 70,898 |  |  | $ | 82,977 |  |  | $ | 92,131 |  |  | $ | 49,543 |  |
| Ratio of Net Charge Offs During the Period to Average Loans Outstanding During the Period | 0.71 | % |  | 1.26 | % |  | 1.82 | % |  | 2.30 | % |  | 0.52 | % |

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|                         |
|-------------------------|
|                         |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                    | 2012 |  | 2011 |  | 2010 |  | 2009 |  | 2008 |
| (Dollars in Thousands)  | Amount |  | Percent |  | Amount |  | Percent |  | Amount |  | Percent |  | Amount |  | Percent |  | Amount |  | Percent |
| Balance at December 31: |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |
| Commercial              | $ | 25,913 |  |  | 26.9 | % |  | $ | 17,731 |  |  | 24.9 | % |  | $ | 32,508 |  |  | 23.1 | % |  | $ | 48,771 |  |  | 25.5 | % |  | $ | 16,368 |  |  | 28.8 | % |
| Commercial Real Estate  | 26,703 |  |  | 47.1 |  |  | 37,919 |  |  | 47.1 |  |  | 36,341 |  |  | 47.1 |  |  | 30,188 |  |  | 43.9 |  |  | 14,408 |  |  | 39.8 |  |
| Consumer                | 2,593 |  |  | 2.6 |  |  | 2,902 |  |  | 3.1 |  |  | 3,622 |  |  | 4.1 |  |  | 2,242 |  |  | 4.7 |  |  | 6,608 |  |  | 5.5 |  |
| Residential             | 14,157 |  |  | 23.3 |  |  | 12,343 |  |  | 24.8 |  |  | 10,408 |  |  | 25.5 |  |  | 10,751 |  |  | 25.7 |  |  | 12,122 |  |  | 25.7 |  |
| Finance Leases          |  |  |  | 0.1 |  |  | 3 |  |  | 0.1 |  |  | 98 |  |  | 0.2 |  |  | 179 |  |  | 0.2 |  |  | 37 |  |  | 0.2 |  |
| Totals                  | $ | 69,366 |  |  | 100.0 | % |  | $ | 70,898 |  |  | 100.0 | % |  | $ | 82,977 |  |  | 100.0 | % |  | $ | 92,131 |  |  | 100.0 | % |  | $ | 49,543 |  |  | 100.0 | % |

|                                                 |
|-------------------------------------------------|
|                                                 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  (Dollars in Thousands)                    | Maturing 3Months or Less |  | Maturing 3-6Months |  | Maturing 6-12 Months |  | Maturing Over12 Months |  | Total |
| Certificates of Deposit and Other Time Deposits | $ | 52,045 |  |  | $ | 41,854 |  |  | $ | 61,858 |  |  | $ | 80,713 |  |  | $ | 236,470 |  |
| Percent                                         | 22 | % |  | 18 | % |  | 26 | % |  | 34 | % |  | 100 | % |

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|                                                                  |
|------------------------------------------------------------------|
|                                                                  |  |  |  |  |  |  |  |  |  |  |  |
| (Dollars in Thousands)                                           | 2012 |  | 2011 |  | 2010 |
| Balance at December 31:                                          |   |  |   |  |   |
| Federal Funds Purchased                                          | $ | 18,862 |  |  |  |  |  |  |  |
| Securities Sold Under Repurchase Agreements (Short-term Portion) | 131,828 |  |  | $ | 146,305 |  |  | $ | 85,621 |  |
| Federal Home Loan Bank Advances  (Short-term Portion)  | 1,434 |  |  | 49,785 |  |  | 18,930 |  |
| Subordinated Debentures and Term Loans                           | 459 |  |  | 78,996 |  |   |
| Total Short-term Borrowings                                      | $ | 152,583 |  |  | $ | 275,086 |  |  | $ | 104,551 |  |

|                                                                       |
|-----------------------------------------------------------------------|
|                                                                       |  |  |  |  |  |  |  |  |  |  |  |
| (Dollars in Thousands)                                                | 2012 |  | 2011 |  | 2010 |
| Weighted Average Interest Rate on Outstanding Balance at December 31: |   |  |   |  |   |
| Federal Funds Purchased                                               | 0.2 | % |  |  |  |  |  |  |
| Securities Sold Under Repurchase Agreements (Short-term Portion)      | 0.2 |  |  | 0.7 | % |  | 0.5 | % |
| Federal Home Loan Bank Advances (Short-term Portion)                  | 2.0 |  |  | 4.8 |  |  | 4.9 |  |
| Subordinated Debentures and Term Loans                                |  |  |  | 2.7 |  |  |   |
| Total Short-term Borrowings                                           | 0.2 | % |  | 2.0 | % |  | 1.3 | % |
| Weighted Average Interest Rate During the Year:                       |   |  |   |  |   |
| Federal Funds Purchased                                               | 0.3 | % |  | 0.4 | % |  | 0.5 | % |
| Securities Sold Under Repurchase Agreements (Short-term Portion)      | 0.3 |  |  | 0.9 |  |  | 0.7 |  |
| Federal Home Loan Bank Advances (Short-term Portion)                  | 3.4 |  |  | 4.4 |  |  | 5.4 |  |
| Subordinated Debentures and Term Loans                                | 2.9 |  |  | 2.8 |  |  |   |
| Total Short-term Borrowings                                           | 0.9 | % |  | 2.3 | % |  | 2.0 | % |
| Highest Amount Outstanding at Any Month End During the Year:          |   |  |   |  |   |
| Federal Funds Purchased                                               | $ | 87,571 |  |  | $ | 27,945 |  |  | $ | 7,746 |  |
| Securities Sold Under Repurchase Agreements (Short-term Portion)      | 150,126 |  |  | 152,315 |  |  | 93,321 |  |
| Federal Home Loan Bank Advances (Short-term Portion)                  | 52,504 |  |  | 104,029 |  |  | 47,854 |  |
| Subordinated Debentures and Term Loans                                | 79,467 |  |  | 78,996 |  |  |   |
| Total Short-term Borrowings                                           | $ | 369,668 |  |  | $ | 363,285 |  |  | $ | 148,921 |  |
| Average Amount Outstanding During the Year:                           |   |  |   |  |   |
| Federal Funds Purchased                                               | $ | 20,072 |  |  | $ | 6,180 |  |  | $ | 1,125 |  |
| Securities Sold Under Repurchase Agreements (Short-term Portion)      | 134,555 |  |  | 107,641 |  |  | 83,323 |  |
| Federal Home Loan Bank Advances (Short-term Portion)                  | 20,869 |  |  | 55,678 |  |  | 33,154 |  |
| Subordinated Debentures and Term Loans                                | 19,337 |  |  | 78,988 |  |  |   |
| Total Short-term Borrowings                                           | $ | 194,833 |  |  | $ | 248,487 |  |  | $ | 117,602 |  |

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|         |                                                                                                                                                                                                                                                          |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | The recent banking crisis, including the Enactment of EESA and American Recovery and Reinvestment Act of 2009 (“ARRA”) may significantly affect the financial condition, results of operations, liquidity or stock price of the Corporation. |

|         |                                                                                                                                |
|---------|--------------------------------------------------------------------------------------------------------------------------------|
| • | The Corporation’s business and financial results are significantly affected by general business and economic conditions. |

|         |                                                                                                             |
|---------|-------------------------------------------------------------------------------------------------------------|
| • | Changes in the domestic interest rate environment could reduce the Corporation’s net interest income. |

|         |                                                                                                                                                                                          |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Changes in the laws, regulations and policies governing banks and financial services companies could alter the Corporation’s business environment and adversely affect operations. |

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|         |                                                                                                                                                                              |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | The banking and financial services industry is highly competitive, and competitive pressures could intensify and adversely affect the Corporation’s financial results. |

|         |                                                                                                                                                                                |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Acts or threats of terrorism and political or military actions taken by the United States or other governments could adversely affect general economic or industry conditions. |

|         |                                                                                               |
|---------|-----------------------------------------------------------------------------------------------|
| • | The Corporation’s allowance for loan losses may not be adequate to cover actual losses. |

|         |                                                                                             |
|---------|---------------------------------------------------------------------------------------------|
| • | The Corporation may suffer losses in its loan portfolio despite its underwriting practices. |

|         |                                                                                                                                       |
|---------|---------------------------------------------------------------------------------------------------------------------------------------|
| • | The Corporation faces operational risks because the nature of the financial services business involves a high volume of transactions. |

|         |                                                                 |
|---------|-----------------------------------------------------------------|
| • | A natural disaster could harm the Corporation’s business. |

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|         |                                                                                                                                          |
|---------|------------------------------------------------------------------------------------------------------------------------------------------|
| • | The Corporation faces systems failure risks as well as security risks, including “hacking” and “identity theft”. |

|         |                                                                                    |
|---------|------------------------------------------------------------------------------------|
| • | The Corporation relies on dividends from its subsidiaries for its liquidity needs. |

|         |                                                                                                                                                        |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | The Corporation’s reported financial results depend on management’s selection of accounting methods and certain assumptions and estimates. |

|         |                                                                                                                       |
|---------|-----------------------------------------------------------------------------------------------------------------------|
| • | A write-down of all or part of the Corporation’s goodwill could materially reduce its net income and net worth. |

|         |                                                                                                       |
|---------|-------------------------------------------------------------------------------------------------------|
| • | Changes in accounting standards could materially impact the Corporation’s financial statements. |

|         |                                                                                               |
|---------|-----------------------------------------------------------------------------------------------|
| • | Significant legal actions could subject the Corporation to substantial uninsured liabilities. |

|         |                                                                                                                             |
|---------|-----------------------------------------------------------------------------------------------------------------------------|
| • | Negative publicity could damage the Corporation’s reputation and adversely impact its business and financial results. |

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|         |                                                                                                                                                                                |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Acquisitions may not produce revenue enhancements or cost savings at levels or within timeframes originally anticipated and may result in unforeseen integration difficulties. |

|         |                                                                                                  |
|---------|--------------------------------------------------------------------------------------------------|
| • | The Corporation may not be able to pay dividends in the future in accordance with past practice. |

|         |                                                      |
|---------|------------------------------------------------------|
| • | The Corporation’s stock price can be volatile. |

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|                             |
|-----------------------------|
|                             |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                        |   |   |   | Period Ending |  |   |
| Index                       |   | 12/31/2007 |  |   | 12/31/2008 |  |   | 12/31/2009 |  |   | 12/31/2010 |  |   | 12/31/2011 |  |   | 12/31/2012 |  |
| First Merchants Corporation |   | 100.00 |  |   | 106.04 |  |   | 30.07 |  |   | 45.08 |  |   | 43.31 |  |   | 76.47 |  |
| Russell 2000                |   | 100.00 |  |   | 66.21 |  |   | 84.20 |  |   | 106.82 |  |   | 102.36 |  |   | 119.09 |  |
| SNL Bank $1B-$5B            |   | 100.00 |  |   | 82.94 |  |   | 59.45 |  |   | 67.39 |  |   | 61.46 |  |   | 75.78 |  |

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|                |
|----------------|
|                |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|           |   | Price Per Share |   |   |   |   |
|           |   | HIGH |   | LOW |   | Dividends Declared (1) |
| Quarter        |   | 2012 |   | 2011 |   | 2012 |   | 2011 |   | 2012 |   | 2011 |
| First Quarter  |   | $ | 12.41 |  |   | $ | 9.45 |  |   | $ | 8.48 |  |   | $ | 7.87 |  |   | $ | 0.01 |  |   | $ | 0.01 |  |
| Second Quarter |   | 12.90 |  |   | 9.70 |  |   | 10.97 |  |   | 7.90 |  |   | 0.03 |  |   | 0.01 |  |
| Third Quarter  |   | 15.78 |  |   | 9.40 |  |   | 12.29 |  |   | 6.70 |  |   | 0.03 |  |   | 0.01 |  |
| Fourth Quarter |   | 15.40 |  |   | 9.04 |  |   | 12.53 |  |   | 6.63 |  |   | 0.03 |  |   | 0.01 |  |

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|                                                            |
|------------------------------------------------------------|
|                                                            |  |  |  |  |  |  |  |  |  |  |  |
| Plan Category                                              |   | Number of securities to beissued upon exercise ofoutstanding options,warrants and rights |   | Weighted-averageexercised price ofoutstanding optionswarrants and rights |   | Number of securities remainingavailable for future issuanceunder equity compensationsplans (excluding securitiesreflected in first column) |   |
| Equity Compensation Plans Approved by Stockholders         |   | 906,636 |  |   | $ | 21.58 |  |   | 692,189 |  | (1)  |
| Equity Compensation Plans Not Approved by Stockholders (2) |   |  |  |   |  |  |   | 398,331 |  |   |
| Total                                                      |   | 906,636 |  |   | $ | 21.58 |  |   | 1,090,520 |  | (1)  |

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|                                                                  |
|------------------------------------------------------------------|
|                                                                  |  |  |  |  |  |  |  |  |  |  |  |
| (Dollars in Thousands)                                           | 2012 |   | 2011 |   | 2010 |
| Net Interest Income                                              | $ | 152,336 |  |  | $ | 143,355 |  |  | $ | 143,569 |  |
| FTE Adjustment                                                   | $ | 5,745 |  |  | $ | 5,759 |  |  | $ | 5,865 |  |
| Net Interest Income on a Fully Taxable Equivalent Basis          | $ | 158,081 |  |  | $ | 149,114 |  |  | $ | 149,434 |  |
| Average Earning Assets                                           | $ | 3,833,174 |  |  | $ | 3,744,027 |  |  | $ | 3,862,493 |  |
| Interest Income (FTE) as a Percent of Average Earning Assets     | 4.74 | % |  | 4.99 | % |  | 5.32 | % |
| Interest Expense as a Percent of Average Earning Assets          | 0.62 | % |  | 1.01 | % |  | 1.45 | % |
| Net Interest Income (FTE) as a Percent of Average Earning Assets | 4.12 | % |  | 3.98 | % |  | 3.87 | % |

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|                                                                  |
|------------------------------------------------------------------|
|                                                                  |  |  |  |  |  |  |  |  |  |  |  |
| (Dollars in Thousands)                                           | 2011 |   | 2010 |   | 2009 |
| Net Interest Income                                              | $ | 143,355 |  |  | $ | 143,569 |  |  | $ | 153,346 |  |
| FTE Adjustment                                                   | $ | 5,759 |  |  | $ | 5,865 |  |  | $ | 5,722 |  |
| Net Interest Income on a Fully Taxable Equivalent Basis          | $ | 149,114 |  |  | $ | 149,434 |  |  | $ | 159,068 |  |
| Average Earning Assets                                           | $ | 3,744,027 |  |  | $ | 3,862,493 |  |  | $ | 4,245,134 |  |
| Interest Income (FTE) as a Percent of Average Earning Assets     | 4.99 | % |  | 5.32 | % |  | 5.56 | % |
| Interest Expense as a Percent of Average Earning Assets          | 1.01 | % |  | 1.45 | % |  | 1.82 | % |
| Net Interest Income (FTE) as a Percent of Average Earning Assets | 3.98 | % |  | 3.87 | % |  | 3.74 | % |

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|                                                                                     |
|-------------------------------------------------------------------------------------|
|                                                                                     |  |  |  |  |  |  |  |
|                                                                                | December 31, |  | December 31, |
| (Dollars in Thousands, Except Per Share Amounts)                                    | 2012 |  | 2011 |
| Average Goodwill                                                                    | $ | 141,362 |  |  | $ | 141,357 |  |
| Average Core Deposit Intangible (CDI)                                               | 8,719 |  |  | 10,655 |  |
| Average Deferred Tax on CDI                                                         | (2,192 | ) |  | (2,458 | ) |
| Intangible Adjustment                                                               | $ | 147,889 |  |  | $ | 149,554 |  |
| Average Stockholders' Equity (GAAP capital)                                         | $ | 535,506 |  |  | $ | 478,440 |  |
| Average Cumulative Preferred Stock                                                  | (125 | ) |  | (125 | ) |
| Average Preferred Stock Issued under the Capital Purchase Program                   |  |  |  | (49,216 | ) |
| Average Non-Cumulative Preferred Stock Issued under the Small Business Lending Fund | (90,783 | ) |  | (24,965 | ) |
| Intangible Adjustment                                                               | (147,889 | ) |  | (149,554 | ) |
| Average Tangible Capital                                                            | $ | 296,709 |  |  | $ | 254,580 |  |
| Average Assets                                                                      | $ | 4,245,863 |  |  | $ | 4,143,850 |  |
| Intangible Adjustment                                                               | (147,889 | ) |  | (149,554 | ) |
| Average Tangible Assets                                                             | $ | 4,097,974 |  |  | $ | 3,994,296 |  |
| Net Income available to Common Stockholders                                         | $ | 40,583 |  |  | $ | 9,013 |  |
| CDI amortization, net of tax                                                        | 1,081 |  |  | 2,112 |  |
| Tangible Net Income (Loss) available to Common Stockholders                         | $ | 41,664 |  |  | $ | 11,125 |  |
| Diluted Earnings Per Share                                                          | $ | 1.41 |  |  | $ | 0.34 |  |
| Diluted Tangible Earnings Per Share                                                 | $ | 1.44 |  |  | $ | 0.42 |  |
| Return on Average GAAP Capital                                                      | 7.58 | % |  | 1.88 | % |
| Return on Average Tangible Capital                                                  | 14.04 | % |  | 4.37 | % |
| Return on Average Assets                                                            | 0.96 | % |  | 0.22 | % |
| Return on Average Tangible Assets                                                   | 1.02 | % |  | 0.28 | % |

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|                                                                                                 |
|-------------------------------------------------------------------------------------------------|
|                                                                                                 |  |  |  |  |  |  |  |  |  |  |  |
| (Dollars in Thousands)                                                                          | 2012 |  | 2011 |  | 2010 |
| Allowance for Loan Losses:                                                                      |   |  |   |  |   |
| Balance at January 1                                                                            | $ | 70,898 |  |  | $ | 82,977 |  |  | $ | 92,131 |  |
| Charge Offs                                                                                     | 27,272 |  |  | 48,473 |  |  | 67,572 |  |
| Recoveries                                                                                      | 7,206 |  |  | 13,764 |  |  | 11,935 |  |
| Net Charge Offs                                                                                 | 20,066 |  |  | 34,709 |  |  | 55,637 |  |
| Provision for Loan Losses                                                                       | 18,534 |  |  | 22,630 |  |  | 46,483 |  |
| Balance at December 31                                                                          | $ | 69,366 |  |  | $ | 70,898 |  |  | $ | 82,977 |  |
|  Ratio of Net Charge Offs During the Period to Average Loans Outstanding During the Period | 0.71 | % |  | 1.26 | % |  | 1.82 | % |
| Ratio of Allowance to Non-Accrual Loans                                                         | 129.90 | % |  | 101.88 | % |  | 91.60 | % |

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|                                                                 |
|-----------------------------------------------------------------|
|                                                                 |  |  |  |  |  |  |  |  |  |  |  |
| (Dollars in Thousands)                                          | December 31, 2012 |  | December 31, 2011 |  | December 31, 2010 |
| Net Charge Offs:                                                |   |  |   |  |   |
| Commercial and industrial loans                                 | $ | 6,133 |  |  | $ | 1,043 |  |  | $ | 15,091 |  |
| Agricultural production financing and other farm loans          | (42 | ) |  | (45 | ) |  | 991 |  |
| Real estate loans                                               |  |  |   |  |   |
| Construction                                                    | 271 |  |  | 6,684 |  |  | 4,550 |  |
| Commercial and farmland                                         | 8,399 |  |  | 20,312 |  |  | 26,853 |  |
| Residential                                                     | 3,052 |  |  | 3,871 |  |  | 6,098 |  |
| Home Equity                                                     | 1,310 |  |  | 2,360 |  |  | 512 |  |
| Individuals loans for household and other personal expenditures | 435 |  |  | 499 |  |  | 1,488 |  |
| Lease financing receivables, net of unearned income             | 32 |  |  | (7 | ) |  | 54 |  |
| Other Loans                                                     | 476 |  |  | (8 | ) |  |  |
| Total Net Charge Offs                                           | $ | 20,066 |  |  | $ | 34,709 |  |  | $ | 55,637 |  |

|                                                          |
|----------------------------------------------------------|
|                                                          |  |  |  |  |  |  |  |
|                                                     | December 31, |  | December 31, |
| (Dollars in Thousands)                                   | 2012 |  | 2011 |
| Non-Performing Assets:                                   |   |  |   |
| Non-accrual loans                                        | $ | 53,399 |  |  | $ | 69,592 |  |
| Renegotiated loans                                       | 12,681 |  |  | 14,308 |  |
| Non-performing loans (NPL)                               | 66,080 |  |  | 83,900 |  |
| Other real estate owned                                  | 13,263 |  |  | 16,289 |  |
| Non-performing assets (NPA)                              | 79,343 |  |  | 100,189 |  |
| 90+ days delinquent and still accruing                   | 2,037 |  |  | 580 |  |
| NPAs & 90+ days delinquent                           | $ | 81,380 |  |  | $ | 100,769 |  |
| Impaired Loans (includes substandard, doubtful and loss) | $ | 79,179 |  |  | $ | 79,775 |  |

|                                                                  |
|------------------------------------------------------------------|
|                                                                  |  |  |  |  |  |  |  |
|                                                             | December 31, |  | December 31, |
| (Dollars in Thousands)                                           | 2012 |  | 2011 |
| Non Performing Assets and 90+ Days Delinquent:                   |   |  |   |
| Commercial and industrial loans                                  | $ | 13,690 |  |  | $ | 13,725 |  |
| Agricultural production financing and other loans to farmers     |  |  |  |  |
| Real estate loans                                                |   |  |   |
| Construction                                                     | 12,378 |  |  | 17,784 |  |
| Commercial and farm land                                         | 34,999 |  |  | 46,985 |  |
| Residential                                                      | 16,620 |  |  | 18,398 |  |
| Home Equity                                                      | 3,198 |  |  | 3,142 |  |
| Lease Financing                                                  | 301 |  |  |  |  |
| Individual's loans for household and other personal expenditures | 190 |  |  | 162 |  |
| Other loans                                                      | 4 |  |  | 573 |  |
| Non performing assets plus 90+ days delinquent                   | $ | 81,380 |  |  | $ | 100,769 |  |

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|                                       |
|---------------------------------------|
|                                       |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                  | December 31, 2012 |
| (Dollars in Thousands)                | Commercial |  | CommercialReal Estate |  | Consumer |  | Residential |  | FinanceLeases |  | Total |
| Allowance Balances:                   |   |  |   |  |   |  |   |  |   |  |   |
| Individually evaluated for impairment | $ | 1,628 |  |  | $ | 2,565 |  |  |  |  | $ | 50 |  |  |  |  | $ | 4,243 |  |
| Collectively evaluated for impairment | 24,285 |  |  | 24,138 |  |  | $ | 2,593 |  |  | 14,107 |  |  |  |  | 65,123 |  |
| Total Allowance for Loan Losses       | $ | 25,913 |  |  | $ | 26,703 |  |  | $ | 2,593 |  |  | $ | 14,157 |  |  |  |  | $ | 69,366 |  |

|                                       |
|---------------------------------------|
|                                       |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                  | December 31, 2011 |
| (Dollars in Thousands)                | Commercial |  | CommercialReal Estate |  | Consumer |  | Residential |  | FinanceLeases |  | Total |
| Allowance Balances:                   |   |  |   |  |   |  |   |  |   |  |   |
| Individually evaluated for impairment | $ | 4,701 |  |  | $ | 2,504 |  |  |  |  | $ | 733 |  |  |  |  | $ | 7,938 |  |
| Collectively evaluated for impairment | 13,030 |  |  | 35,415 |  |  | $ | 2,902 |  |  | 11,610 |  |  | $ | 3 |  |  | 62,960 |  |
| Total Allowance for Loan Losses       | $ | 17,731 |  |  | $ | 37,919 |  |  | $ | 2,902 |  |  | $ | 12,343 |  |  | $ | 3 |  |  | $ | 70,898 |  |

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|                                   |
|-----------------------------------|
|                                   |  |  |  |
|                              | December 31, |
| (Dollars in Thousands)            | 2012 |
| Amounts of Commitments:           |   |
| Loan Commitments to Extend Credit | $ | 873,455 |  |
| Standby Letters of Credit         | 21,734 |  |
|                              | $ | 895,189 |  |

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Table of Contents

|                                             |
|---------------------------------------------|
|                                             |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| (Dollars in Thousands)                      | 2013 |  | 2014 |  | 2015 |  | 2016 |  | 2017 |  | 2018 andafter |  | Total |
| Operating Leases                            | $ | 2,284 |  |  | $ | 2,025 |  |  | $ | 1,852 |  |  | $ | 1,441 |  |  | $ | 865 |  |  | $ | 1,428 |  |  | $ | 9,895 |  |
| Federal Funds Purchased                     | 18,862 |  |  |  |  |  |  |  |  |  |  |  |  |  | 18,862 |  |
| Securities Sold Under Repurchase Agreements | 131,828 |  |  | 10,000 |  |  |  |  |  |  |  |  |  |  |  | 141,828 |  |
| Federal Home Loan Bank Advances             | 1,619 |  |  | 26,506 |  |  | 30,986 |  |  | 28,933 |  |  | 2,731 |  |  | 3,463 |  |  | 94,238 |  |
| Subordinated Debentures and Term Loans      | 459 |  |  |  |  | 55,000 |  |  |  |  |  |  |  | 56,702 |  |  | 112,161 |  |
| Total                                       | $ | 155,052 |  |  | $ | 38,531 |  |  | $ | 87,838 |  |  | $ | 30,374 |  |  | $ | 3,596 |  |  | $ | 61,593 |  |  | $ | 376,984 |  |

|                                                  |
|--------------------------------------------------|
|                                                  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                             | December 31, 2012 |
| (Dollars in Thousands)                           | 1-180 Days |  | 181-365 Days |  | 1-5 Years |  | Beyond 5 Years |  | Total |
| Rate-Sensitive Assets:                           |   |  |   |  |   |  |   |  |   |
| Interest-bearing Deposits                        | $ | 38,443 |  |  |  |  |  |  |  |  | $ | 38,443 |  |
| Investment Securities                            | 84,259 |  |  | $ | 67,597 |  |  | $ | 326,387 |  |  | $ | 396,120 |  |  | 874,363 |  |
| Loans                                            | 1,737,624 |  |  | 326,405 |  |  | 679,648 |  |  | 111,466 |  |  | 2,855,143 |  |
| Federal Reserve and Federal Home Loan Bank Stock |   |  |   |  | 32,785 |  |  |   |  | 32,785 |  |
| Total Rate-sensitive Assets                      | $ | 1,860,326 |  |  | $ | 394,002 |  |  | $ | 1,038,820 |  |  | $ | 507,586 |  |  | $ | 3,800,734 |  |
| Rate-Sensitive Liabilities:                      |   |  |   |  |   |  |   |  |   |
| Interest-bearing Deposits                        | $ | 1,379,731 |  |  | $ | 295,668 |  |  | $ | 711,507 |  |  | $ | 157,880 |  |  | $ | 2,544,786 |  |
| Federal Funds Purchased                          | 18,862 |  |  |  |  |  |  |  |  |  | 18,862 |  |
| Securities Sold Under Repurchase Agreements      | 131,828 |  |  |  |  | 10,000 |  |  |  |  | 141,828 |  |
| Federal Home Loan Bank Advances                  | 2,469 |  |  | 1,323 |  |  | 88,016 |  |  | 2,430 |  |  | 94,238 |  |
| Subordinated Debentures and Term Loans           | 111,702 |  |  |  |  |  |  |  | 459 |  |  | 112,161 |  |
| Total Rate-sensitive Liabilities                 | $ | 1,644,592 |  |  | $ | 296,991 |  |  | $ | 809,523 |  |  | $ | 160,769 |  |  | $ | 2,911,875 |  |
|  Interest Rate Sensitivity Gap by Period    | $ | 215,734 |  |  | $ | 97,011 |  |  | $ | 229,297 |  |  | $ | 346,817 |  |  |  |  |
| Cumulative Rate Sensitivity Gap                  | $ | 215,734 |  |  | $ | 312,745 |  |  | $ | 542,042 |  |  | $ | 888,859 |  |  |   |
| Cumulative Rate Sensitivity Gap Ratio            |   |  |   |  |   |  |   |  |   |
| at December 31, 2012                             | 113.1 | % |  | 116.1 | % |  | 119.7 | % |  | 130.5 | % |  |   |
| at December 31, 2011                             | 98.2 | % |  | 99.0 | % |  | 112.0 | % |  | 124.0 | % |  |   |

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|                |
|----------------|
|                |  |  |  |  |
|           |  | At December 31, 2012 |
|           |  | RISING |  | FALLING |
| Driver Rates   |  | (200 Basis Points) |  | (100 Basis Points) |
| Prime          |  | 200 |  | 0 |
| Federal Funds  |  | 200 |  | 0 |
| One-Year CMT   |  | 200 |  | (8) |
| Three-Year CMT |  | 200 |  | (3) |
| Five-Year CMT  |  | 200 |  | (10) |
| CD's           |  | 200 |  | (25) |
| FHLB           |  | 200 |  | (5) |

|                             |
|-----------------------------|
|                             |  |  |  |  |  |  |  |  |  |  |  |
|                        | At December 31, 2012 |
|                        |   |  | RISING |  | FALLING |
| (Dollars in Thousands)      | Base |  | (200 Basis Points) |  | (100 Basis Points) |
| Net Interest Income         | $ | 145,846 |  |  | $ | 153,621 |  |  | $ | 144,122 |  |
| Variance from Base          |  |  | $ | 7,775 |  |  | $ | (1,724 | ) |
| Percent of Change from Base |  |  |  | 5.33 | % |  | (1.18 | )% |

|                |
|----------------|
|                |  |  |  |  |
|           |   | At December 31, 2011 |
|           |  | RISING |  | FALLING |
| Driver Rates   |  | (200 Basis Points) |  | (100 Basis Points) |
| Prime          |  | 200 |  | 0 |
| Federal Funds  |  | 200 |  | 0 |
| One-Year CMT   |  | 200 |  | (2) |
| Three-Year CMT |  | 200 |  | (6) |
| Five-Year CMT  |  | 200 |  | 0 |
| CD's           |  | 200 |  | (42) |
| FHLB           |  | 200 |  | 0 |

----

Table of Contents

|                             |
|-----------------------------|
|                             |  |  |  |  |  |  |  |  |  |  |  |
|                        | At December 31, 2011 |
|                        |   |  | RISING |  | FALLING |
| (Dollars in Thousands)      | Base |  | (200 Basis Points) |  | (100 Basis Points) |
| Net Interest Income         | $ | 142,706 |  |  | $ | 146,352 |  |  | $ | 140,332 |  |
| Variance from Base          |   |  | $ | 3,646 |  |  | $ | (2,374 | ) |
| Percent of Change from Base |  |  |  | 2.55 | % |  | (1.66 | )% |

|                                                  |
|--------------------------------------------------|
|                                                  |  |  |  |  |  |  |  |
|                                             | December 31, |  | December 31, |
| (Dollars in Thousands)                           | 2012 |   | 2011 |
| Interest-bearing Time Deposits                   | $ | 38,443 |  |  | $ | 52,851 |  |
| Investment Securities Available for Sale         | 513,343 |  |  | 518,491 |  |
| Investment Securities Held to Maturity           | 361,020 |  |  | 427,909 |  |
| Mortgage Loans Held for Sale                     | 22,300 |  |  | 17,864 |  |
| Loans                                            | 2,902,209 |  |  | 2,713,415 |  |
| Federal Reserve and Federal Home Loan Bank Stock | 32,785 |  |  | 31,270 |  |
|                                             | $ | 3,870,100 |  |  | $ | 3,761,800 |  |

|                                             |
|---------------------------------------------|
|                                             |  |  |  |  |  |  |  |
|                                        | December 31, |  | December 31, |
| (Dollars in Thousands)                      | 2012 |  | 2011 |
| Deposits                                    | $ | 3,346,383 |  |  | $ | 3,134,655 |  |
| Federal Funds Purchased                     | 18,862 |  |  |  |  |
| Securities Sold Under Repurchase Agreements | 141,828 |  |  | 156,305 |  |
| Federal Home Loan Bank Advances             | 94,238 |  |  | 138,095 |  |
| Subordinated Debentures and Term Loans      | 112,161 |  |  | 194,974 |  |
|                                        | $ | 3,713,472 |  |  | $ | 3,624,029 |  |

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|                                                                              |
|------------------------------------------------------------------------------|
|                                                                              |  |  |  |  |  |  |  |
|                                                                         | December 31, |   | December 31, |
| (Dollars in Thousands, Except Share Data)                                    | 2012 |   | 2011 |
| ASSETS                                                                       |   |   |   |
| Cash and cash equivalents                                                    | $ | 101,460 |  |   | $ | 73,312 |  |
| Interest-bearing time deposits                                               | 38,443 |  |   | 52,851 |  |
| Investment securities available for sale                                     | 513,343 |  |   | 518,491 |  |
| Investment securities held to maturity (fair value of $378,174 and $442,469) | 361,020 |  |   | 427,909 |  |
| Mortgage loans held for sale                                                 | 22,300 |  |   | 17,864 |  |
| Loans                                                                        | 2,902,209 |  |   | 2,713,415 |  |
| Less: Allowance for loan losses                                              | (69,366 | ) |   | (70,898 | ) |
| Net loans                                                                    | 2,832,843 |  |   | 2,642,517 |  |
| Premises and equipment                                                       | 52,749 |  |   | 51,013 |  |
| Federal Reserve and Federal Home Loan Bank stock                             | 32,785 |  |   | 31,270 |  |
| Interest receivable                                                          | 16,367 |  |   | 17,723 |  |
| Core deposit intangibles                                                     | 8,154 |  |   | 9,114 |  |
| Goodwill                                                                     | 141,375 |  |   | 141,357 |  |
| Cash surrender value of life insurance                                       | 125,397 |  |   | 124,329 |  |
| Other real estate owned                                                      | 13,263 |  |   | 16,289 |  |
| Tax asset, deferred and receivable                                           | 30,867 |  |   | 36,424 |  |
| Other assets                                                                 | 14,455 |  |   | 12,613 |  |
| TOTAL ASSETS                                                                 | $ | 4,304,821 |  |   | $ | 4,173,076 |  |
| LIABILITIES                                                                  |   |   |   |
| Deposits:                                                                    |   |   |   |
| Noninterest-bearing                                                          | $ | 801,597 |  |   | $ | 646,508 |  |
| Interest-bearing                                                             | 2,544,786 |  |   | 2,488,147 |  |
| Total Deposits                                                               | 3,346,383 |  |   | 3,134,655 |  |
| Borrowings:                                                                  |   |   |   |
| Federal funds purchased                                                      | 18,862 |  |   |   |
| Securities sold under repurchase agreements                                  | 141,828 |  |   | 156,305 |  |
| Federal Home Loan Bank advances                                              | 94,238 |  |   | 138,095 |  |
| Subordinated debentures and term loans                                       | 112,161 |  |   | 194,974 |  |
| Total Borrowings                                                             | 367,089 |  |   | 489,374 |  |
| Interest payable                                                             | 1,841 |  |   | 2,925 |  |
| Other liabilities                                                            | 37,272 |  |   | 31,655 |  |
| Total Liabilities                                                            | 3,752,585 |  |   | 3,658,609 |  |
| COMMITMENTS AND CONTINGENT LIABILITIES                                       |  |   |  |
| STOCKHOLDERS' EQUITY                                                         |   |   |   |
| Preferred Stock, no-par value, $1,000 liquidation value:                     |   |   |   |
| Authorized - 500,000 shares                                                  |   |   |   |
| Senior Non-Cumulative Perpetual Preferred Stock, Series B                    |   |   |   |
| Issued and outstanding - 90,782.94 shares                                    | 90,783 |  |   | 90,783 |  |
| Cumulative Preferred Stock, $1,000 par value, $1,000 liquidation value:      |   |   |   |
| Authorized - 600 shares                                                      |   |   |   |
| Issued and outstanding - 125 shares                                          | 125 |  |   | 125 |  |
| Common Stock, $.125 stated value:                                            |   |   |   |
| Authorized - 50,000,000 shares                                               |   |   |   |
| Issued and outstanding - 28,692,616 and 28,559,707 shares                    | 3,587 |  |   | 3,570 |  |
| Additional paid-in capital                                                   | 256,843 |  |   | 254,874 |  |
| Retained earnings                                                            | 206,397 |  |   | 168,717 |  |
| Accumulated other comprehensive loss                                         | (5,499 | ) |   | (3,602 | ) |
| Total Stockholders' Equity                                                   | 552,236 |  |   | 514,467 |  |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                   | $ | 4,304,821 |  |   | $ | 4,173,076 |  |

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|                                                                       |
|-----------------------------------------------------------------------|
|                                                                       |  |  |  |  |  |  |  |  |  |  |  |
|                                                                  | December 31, |   | December 31, |   | December 31, |
| (Dollars in Thousands, Except Share Data)                             | 2012 |   | 2011 |   | 2010 |
| INTEREST INCOME                                                       |   |   |   |   |   |
| Loans receivable:                                                     |   |   |   |   |   |
| Taxable                                                               | $ | 146,745 |  |   | $ | 149,716 |  |   | $ | 174,070 |  |
| Tax-exempt                                                            | 480 |  |   | 528 |  |   | 515 |  |
| Investment securities:                                                |   |   |   |   |   |
| Taxable                                                               | 17,027 |  |   | 19,230 |  |   | 12,957 |  |
| Tax-exempt                                                            | 10,189 |  |   | 10,167 |  |   | 10,377 |  |
| Federal funds sold                                                    |  |  |   | 3 |  |   | 26 |  |
| Deposits with financial institutions                                  | 100 |  |   | 282 |  |   | 381 |  |
| Federal Reserve and Federal Home Loan Bank stock                      | 1,408 |  |   | 1,319 |  |   | 1,252 |  |
| Total Interest Income                                                 | 175,949 |  |   | 181,245 |  |   | 199,578 |  |
| INTEREST EXPENSE                                                      |   |   |   |   |   |
| Deposits                                                              | 14,800 |  |   | 22,281 |  |   | 39,876 |  |
| Federal funds purchased                                               | 69 |  |   | 25 |  |   | 5 |  |
| Securities sold under repurchase agreements                           | 907 |  |   | 1,511 |  |   | 1,712 |  |
| Federal Home Loan Bank advances                                       | 2,624 |  |   | 4,181 |  |   | 5,368 |  |
| Subordinated debentures, revolving credit lines and term loans        | 5,213 |  |   | 9,892 |  |   | 9,048 |  |
| Total Interest Expense                                                | 23,613 |  |   | 37,890 |  |   | 56,009 |  |
| NET INTEREST INCOME                                                   | 152,336 |  |   | 143,355 |  |   | 143,569 |  |
| Provision for loan losses                                             | 18,534 |  |   | 22,630 |  |   | 46,483 |  |
| NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES                   | 133,802 |  |   | 120,725 |  |   | 97,086 |  |
| OTHER INCOME                                                          |   |   |   |   |   |
| Service charges on deposit accounts                                   | 11,587 |  |   | 11,972 |  |   | 13,283 |  |
| Fiduciary activities                                                  | 7,891 |  |   | 7,650 |  |   | 7,692 |  |
| Other customer fees                                                   | 11,233 |  |   | 10,024 |  |   | 8,990 |  |
| Commission income                                                     | 6,224 |  |   | 5,660 |  |   | 6,225 |  |
| Earnings on cash surrender value of life insurance                    | 3,418 |  |   | 2,596 |  |   | 2,098 |  |
| Net gains and fees on sales of loans                                  | 10,628 |  |   | 7,418 |  |   | 6,806 |  |
| Net realized gains on sales of available for sale securities          | 2,389 |  |   | 2,439 |  |   | 3,406 |  |
| Other-than-temporary impairment on available for sale securities      |  |  |   | (2,788 | ) |   | (3,049 | ) |
| Portion of loss recognized in other comprehensive income before taxes |  |  |   | 2,388 |  |   | 1,505 |  |
| Net impairment losses recognized in earnings                          |  |  |   | (400 | ) |   | (1,544 | ) |
| Gain on FDIC modified whole bank transaction                          | 9,124 |  |   |   |   |   |
| Other income                                                          | 1,808 |  |   | 1,761 |  |   | 1,588 |  |
| Total Other Income                                                    | 64,302 |  |   | 49,120 |  |   | 48,544 |  |
| OTHER EXPENSES                                                        |   |   |   |   |   |
| Salaries and employee benefits                                        | 79,398 |  |   | 74,735 |  |   | 73,253 |  |
| Net occupancy                                                         | 10,186 |  |   | 10,118 |  |   | 9,935 |  |
| Equipment                                                             | 7,201 |  |   | 6,794 |  |   | 7,323 |  |
| Marketing                                                             | 2,158 |  |   | 2,002 |  |   | 1,970 |  |
| Outside data processing fees                                          | 5,656 |  |   | 5,671 |  |   | 5,093 |  |
| Printing and office supplies                                          | 1,169 |  |   | 1,242 |  |   | 1,259 |  |
| Core deposit amortization                                             | 1,927 |  |   | 3,548 |  |   | 4,721 |  |
| FDIC assessments                                                      | 3,509 |  |   | 5,531 |  |   | 8,121 |  |
| Other real estate owned and credit-related expenses                   | 8,178 |  |   | 10,614 |  |   | 12,436 |  |
| Other expenses                                                        | 17,733 |  |   | 15,683 |  |   | 18,200 |  |
| Total Other Expenses                                                  | 137,115 |  |   | 135,938 |  |   | 142,311 |  |
| INCOME BEFORE INCOME TAX                                              | 60,989 |  |   | 33,907 |  |   | 3,319 |  |
| Income tax expense (benefit)                                          | 15,867 |  |   | 8,655 |  |   | (3,590 | ) |
| NET INCOME                                                            | 45,122 |  |   | 25,252 |  |   | 6,909 |  |
| Gain on exchange of preferred stock for trust preferred debt          |   |   |  |  |   | 11,353 |  |
| Loss on CPP unamortized discount                                      |  |  |   | (1,401 | ) |   | (1,301 | ) |
| Loss on extinguishment of trust preferred securities                  |  |  |   | (10,857 | ) |   |   |
| Preferred stock dividends and discount accretion                      | (4,539 | ) |   | (3,981 | ) |   | (5,239 | ) |
| NET INCOME AVAILABLE TO COMMON STOCKHOLDERS                           | $ | 40,583 |  |   | $ | 9,013 |  |   | $ | 11,722 |  |
|                                                                  |   |   |   |   |   |
| NET INCOME AVAILABLE TO COMMON STOCKHOLDERS PER SHARE:                |   |   |
| Basic                                                                 | $ | 1.42 |  |   | $ | 0.34 |  |   | $ | 0.48 |  |
| Diluted                                                               | $ | 1.41 |  |   | $ | 0.34 |  |   | $ | 0.48 |  |

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|                                                                                                                                                                                              |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                              |  |  |  |  |  |  |  |  |  |  |  |
| (Dollars in Thousands)                                                                                                                                                                       | December 31, 2012 |   | December 31, 2011 |   | December 31, 2010 |
| Net income                                                                                                                                                                                   | $ | 45,122 |  |  | $ | 25,252 |  |  | $ | 6,909 |  |
| Other comprehensive income (loss) net of tax:                                                                                                                                                |   |  |   |  |  |
| Unrealized holding gain (loss) on securities available for sale arising during the period, net of tax of $654, $10,658, and $106                                                             | 1,214 |  |  | 19,793 |  |  | (197 | ) |
| Unrealized loss on securities transferred to held-to-maturity, net of tax of $2,864                                                                                                     |  |  |  | (5,315 | ) |  |  |  |
| Unrealized gain (loss) on securities available for sale for which a portion of an other than temporary impairment has been recognized in income, net of tax of  $56, $86, and $539 | (104 | ) |  | 160 |  |  | (1,001 | ) |
| Unrealized gain (loss) on cash flow hedges arising during the period, net of tax of $514, $1,146, and $155                                                                                   | (952 | ) |  | (2,129 | ) |  | 288 |  |
| Reclassification adjustment for net gains included in net income net of tax of $759, $714, and $652                                                                                          | (1,413 | ) |  | (1,326 | ) |  | (1,210 | ) |
| Defined Benefit Pension Plans, net of tax of  $346, $2,492, and $526                                                                                                               |  |  |  |  |  |  |  |  |
| Net Gain (Loss) Arising During Period                                                                                                                                                        | (577 | ) |  | (5,722 | ) |  | 156 |  |
| Prior Service Cost Arising During Period                                                                                                                                                     |  |  |  | 26 |  |  | 583 |  |
| Amortization of Prior Service Cost                                                                                                                                                           | (65 | ) |  | 1,068 |  |  | 50 |  |
|                                                                                                                                                                                         | (1,897 | ) |  | 6,555 |  |  | (1,331 | ) |
| Comprehensive income                                                                                                                                                                         | $ | 43,225 |  |  | $ | 31,807 |  |  | $ | 5,578 |  |

|                                                                                                                                              |
|----------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                              |  |  |  |  |  |  |  |
| (Dollars in Thousands)                                                                                                                       | December 31, 2012 |   | December 31, 2011 |
| Net unrealized gain on securities available for sale                                                                                         | $ | 17,904 |  |   | $ | 18,244 |  |
| Net unrealized loss on securities available for sale for which a portion of an other-than-temporary impairment has been recognized in income | (3,272 | ) |   | (3,168 | ) |
| Net unrealized loss on cash flow hedges                                                                                                      | (2,652 | ) |   | (1,841 | ) |
| Defined benefit plans                                                                                                                        | (17,479 | ) |   | (16,837 | ) |
|                                                                                                                                         | $ | (5,499 | ) |   | $ | (3,602 | ) |

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|                                                                     |
|---------------------------------------------------------------------|
|                                                                     |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                                     | Preferred |  | Common Stock |  |  |  |  |  |  |  |  |
| (Dollars in Thousands, Except Share Data)                           | Shares |  | Amount |  | Shares |  | Amount |  | Additional Paid inCapital |  | RetainedEarnings |  | Accumulated Other ComprehensiveIncome (Loss) |  | Total |
| Balances, December 31, 2009                                         | 116,125 |  |  | $ | 112,498 |  |  | 21,227,741 |  |  | $ | 2,653 |  |  | $ | 206,600 |  |  | $ | 150,860 |  |  | $ | (8,826 | ) |  | $ | 463,785 |  |
| Comprehensive Income                                                |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |
| Net Income                                                          |   |  |   |  |   |  |   |  |   |  | 6,909 |  |  |   |  | 6,909 |  |
| Other Comprehensive Income, net of tax                              |   |  |   |  |   |  |   |  |   |  |   |  | (1,331 | ) |  | (1,331 | ) |
| Cash Dividends on Common Stock ($.04 per Share)                     |   |  |   |  |   |  |   |  |   |  | (989 | ) |  |   |  | (989 | ) |
| Cash Dividends on Preferred Stock under Capital Purchase Program    |   |  |   |  |   |  |   |  |   |  | (5,366 | ) |  |   |  | (5,366 | ) |
| Cumulative Preferred Stock Converted to Trust Preferred Securities  | (46,400 | ) |  | (46,400 | ) |  |   |  |   |  |   |  |   |  |   |  | (46,400 | ) |
| Gain on Exchange of Preferred Stock for Trust Preferred Debt        |   |  |   |  |   |  |   |  |   |  | 11,353 |  |  |   |  | 11,353 |  |
| Loss on Capital Purchase Program Unamortized Discount               |   |  | 1,301 |  |  |   |  |   |  |   |  | (1,301 | ) |  |   |  |  |  |
| Accretion of Discount on Preferred Stock                            |   |  | 606 |  |  |   |  |   |  |   |  | (606 | ) |  |   |  |  |  |
| Private Stock Issuance                                              |   |  |   |  | 4,200,000 |  |  | 525 |  |  | 23,625 |  |  |   |  |   |  | 24,150 |  |
| Tax Benefit (Loss) from Stock Options Exercised                     |   |  |   |  |   |  |   |  | (50 | ) |  |   |  |   |  | (50 | ) |
| Share-based Compensation                                            |   |  |   |  | 49,833 |  |  | 6 |  |  | 1,744 |  |  |   |  |   |  | 1,750 |  |
| Stock Issued Under Employee Benefit Plans                           |   |  |   |  | 97,966 |  |  | 12 |  |  | 570 |  |  |   |  |   |  | 582 |  |
| Stock Issued Under Dividend Reinvestment and Stock Purchase Plan    |   |  |   |  | 11,545 |  |  | 2 |  |  | 89 |  |  |   |  |   |  | 91 |  |
| Stock Redeemed                                                      |   |  |   |  | (12,834 | ) |  | (1 | ) |  | (75 | ) |  |   |  |   |  | (76 | ) |
| Balances, December 31, 2010                                         | 69,725 |  |  | $ | 68,005 |  |  | 25,574,251 |  |  | $ | 3,197 |  |  | $ | 232,503 |  |  | $ | 160,860 |  |  | $ | (10,157 | ) |  | $ | 454,408 |  |
| Comprehensive Income                                                |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  |   |  |
| Net Income                                                          |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  | 25,252 |  |  |   |  |  | 25,252 |  |
| Other Comprehensive Income, net of tax                              |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  | 6,555 |  |  | 6,555 |  |
| Cash Dividends on Common Stock ($.04 per Share)                     |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  | (1,067 | ) |  |   |  |  | (1,067 | ) |
| Cash Dividends on Preferred Stock under Capital Purchase Program    |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  | (3,662 | ) |  |   |  |  | (3,662 | ) |
| Accretion of Discount on Preferred Stock                            |   |  |  | 319 |  |  |   |  |  |   |  |  |   |  |  | (319 | ) |  |   |  |  |  |
| Loss on Capital Purchase Program Unamortized Discount               |   |  |  | 1,401 |  |  |   |  |  |   |  |  |   |  |  | (1,401 | ) |  |   |  |  |  |
| Repurchase of Capital Purchase Program Warrants                     |   |  |  |   |  |  |   |  |  |   |  |  | (368 | ) |  |   |  |  |   |  |  | (368 | ) |
| Loss on Extinguishment of Trust Preferred Securities                |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  | (10,857 | ) |  |   |  |  | (10,857 | ) |
| Equity Adjustment Related to First Merchants Reinsurance Co. LTD    |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  | (89 | ) |  |   |  |  | (89 | ) |
| Preferred Stock Redeemed under Capital Purchase Program             | (69,600 | ) |  | (69,600 | ) |  |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  | (69,600 | ) |
| Preferred Stock issued under the Small Business Lending Fund        | 90,783 |  |  | 90,783 |  |  |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  | 90,783 |  |
| Private Stock Issuance                                              |   |  |  |   |  |  | 2,822,000 |  |  | 353 |  |  | 20,812 |  |  |   |  |  |   |  |  | 21,165 |  |
| Share-based Compensation                                            |   |  |  |   |  |  | 72,824 |  |  | 9 |  |  | 1,306 |  |  |   |  |  |   |  |  | 1,315 |  |
| Stock Issued Under Employee Benefit Plans                           |   |  |  |   |  |  | 93,797 |  |  | 12 |  |  | 657 |  |  |   |  |  |   |  |  | 669 |  |
| Stock Issued Under Dividend Reinvestment and Stock Purchase Plan    |   |  |  |   |  |  | 11,073 |  |  | 1 |  |  | 88 |  |  |   |  |  |   |  |  | 89 |  |
| Stock Redeemed                                                      |   |  |  |   |  |  | (14,238 | ) |  | (2 | ) |  | (124 | ) |  |   |  |  |   |  |  | (126 | ) |
| Balances, December 31, 2011                                         | 90,908 |  |  | $ | 90,908 |  |  | 28,559,707 |  |  | $ | 3,570 |  |  | $ | 254,874 |  |  | $ | 168,717 |  |  | $ | (3,602 | ) |  | $ | 514,467 |  |
| Comprehensive Income                                                |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Net Income                                                          |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 45,122 |  |  |  |  |  | 45,122 |  |
| Other Comprehensive Income, net of tax                              |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (1,897 | ) |  | (1,897 | ) |
| Cash Dividends on Common Stock ($.10 per Share)                     |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (2,903 | ) |  |  |  |  | (2,903 | ) |
| Cash Dividends on Preferred Stock under Small Business Lending Fund |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (4,539 | ) |  |  |  |  | (4,539 | ) |
| Share-based Compensation                                            |  |  |  |  |  |  | 86,325 |  |  | 11 |  |  | 1,481 |  |  |  |  |  |  |  |  | 1,492 |  |
| Stock Issued Under Employee Benefit Plans                           |  |  |  |  |  |  | 41,867 |  |  | 5 |  |  | 444 |  |  |  |  |  |  |  |  | 449 |  |
| Stock Issued Under Dividend Reinvestment and Stock Purchase Plan    |  |  |  |  |  |  | 15,709 |  |  | 2 |  |  | 200 |  |  |  |  |  |  |  |  | 202 |  |
| Stock Options Exercised                                             |  |  |  |  |  |  | 10,500 |  |  | 1 |  |  | 77 |  |  |  |  |  |  |  |  | 78 |  |
| Stock Redeemed                                                      |  |  |  |  |  |  | (21,492 | ) |  | (2 | ) |  | (233 | ) |  |  |  |  |  |  |  | (235 | ) |
| Balances, December 31, 2012                                         | 90,908 |  |  | $ | 90,908 |  |  | 28,692,616 |  |  | $ | 3,587 |  |  | $ | 256,843 |  |  | $ | 206,397 |  |  | $ | (5,499 | ) |  | $ | 552,236 |  |

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|                                                                                   |
|-----------------------------------------------------------------------------------|
|                                                                                   |  |  |  |  |  |  |  |  |  |  |  |
|                                                                              | December 31, |   | December 31, |   | December 31, |
| (Dollars in Thousands)                                                            | 2012 |   | 2011 |   | 2010 |
| Cash Flow From Operating Activities:                                              |   |   |   |   |   |
| Net income                                                                        | $ | 45,122 |  |   | $ | 25,252 |  |   | $ | 6,909 |  |
| Adjustments to reconcile net income to net cash provided by operating activities: |   |   |   |   |   |
| Provision for loan losses                                                         | 18,534 |  |   | 22,630 |  |   | 46,483 |  |
| Depreciation and amortization                                                     | 4,472 |  |   | 5,158 |  |   | 5,702 |  |
| Change in deferred taxes                                                          | 15,890 |  |   | 8,256 |  |   | (1,810 | ) |
| Share-based compensation                                                          | 1,492 |  |   | 1,315 |  |   | 1,750 |  |
| Tax expense (benefit) from stock options exercised                                |  |   |  |  |   | 50 |  |
| Mortgage loans originated for sale                                                | (393,565 | ) |   | (297,031 | ) |   | (254,712 | ) |
| Proceeds from sales of mortgage loans                                             | 389,129 |  |   | 300,636 |  |   | 241,279 |  |
| Gain on acquisition                                                               | (9,124 | ) |   |  |  |   |  |  |
| Gains on sales of securities available for sale                                   | (2,389 | ) |   | (2,439 | ) |   | (3,406 | ) |
| Recognized loss on other-than-temporary-impairment                                |  |  |   | 400 |  |   | 1,544 |  |
| Change in interest receivable                                                     | 1,884 |  |   | 951 |  |   | 2,144 |  |
| Change in interest payable                                                        | (1,451 | ) |   | (1,337 | ) |   | (1,449 | ) |
| Other adjustments                                                                 | 275 |  |   | 21,693 |  |   | 36,567 |  |
| Net cash provided by operating activities                                         | $ | 70,269 |  |   | $ | 85,484 |  |   | $ | 81,051 |  |
| Cash Flows from Investing Activities:                                             |   |   |   |   |   |
| Net change in interest-bearing deposits                                           | $ | 14,408 |  |   | $ | 12,365 |  |   | $ | 8,809 |  |
| Purchases of:                                                                     |   |   |   |   |   |
| Securities available for sale                                                     | (139,555 | ) |   | (200,688 | ) |   | (311,465 | ) |
| Securities held to maturity                                                       | (4,262 | ) |   | (82,700 | ) |   | (180,311 | ) |
| Proceeds from sales of securities available for sale                              | 52,350 |  |   | 75,930 |  |   | 117,804 |  |
| Proceeds from maturities of:                                                      |   |   |   |   |   |
| Securities available for sale                                                     | 112,141 |  |   | 60,459 |  |   | 65,688 |  |
| Securities held to maturity                                                       | 68,118 |  |   | 45,595 |  |   | 40,825 |  |
| Change in Federal Reserve and Federal Home Loan Bank stock                        | 246 |  |   | 2,614 |  |   | 4,692 |  |
| Purchase of bank owned life insurance                                             |  |  |   | (25,000 | ) |   |  |
| Net change in loans                                                               | (123,036 | ) |   | 61,363 |  |   | 345,518 |  |
| Net cash received from acquisition                                                | 29,113 |  |   |  |  |   |  |  |
| Proceeds from the sale of other real estate owned                                 | 4,428 |  |   | 13,612 |  |   | 20,641 |  |
| Other adjustments                                                                 | (2,065 | ) |   | 8,287 |  |   | (2,348 | ) |
| Net cash provided by (used in) investing activities                               | $ | 11,886 |  |   | $ | (28,163 | ) |   | $ | 109,853 |  |
| Cash Flows from Financing Activities:                                             |   |   |   |   |   |
| Net change in :                                                                   |   |   |   |   |   |
| Demand and savings deposits                                                       | $ | 228,725 |  |   | $ | 68,803 |  |   | $ | 84,993 |  |
| Certificates of deposit and other time deposits                                   | (142,906 | ) |   | (203,028 | ) |   | (352,649 | ) |
| Borrowings                                                                        | 138,127 |  |   | 306,535 |  |   | 2,382 |  |
| Repayment of borrowings                                                           | (271,005 | ) |   | (252,509 | ) |   | (65,247 | ) |
| Dividends on common stock                                                         | (2,903 | ) |   | (1,067 | ) |   | (989 | ) |
| Dividends on preferred stock                                                      | (4,539 | ) |   | (3,662 | ) |   | (4,931 | ) |
| Stock issued in private equity placement                                          |  |  |   | 21,165 |  |   | 24,150 |  |
| Stock issued under employee benefit plans                                         | 449 |  |   | 669 |  |   | 582 |  |
| Stock issued under dividend reinvestment and stock purchase plans                 | 202 |  |   | 89 |  |   | 91 |  |
| Stock options exercised                                                           | 78 |  |   |  |   |  |
| Cumulative preferred stock issued (SBLF)                                          |  |   | 90,783 |  |   |  |
| Cumulative preferred stock redeemed (CPP)                                         |  |   | (69,600 | ) |   |  |
| Repurchase of stock warrant (CPP)                                                 |  |  |   | (368 | ) |   |  |
| Tax (expense) benefit from stock options exercised                                |   |   |  |  |   | (50 | ) |
| Stock redeemed                                                                    | (235 | ) |   | (126 | ) |   | (76 | ) |
| Net cash used in financing activities                                             | $ | (54,007 | ) |   | (42,316 | ) |   | $ | (311,744 | ) |
| Net Change in Cash and Cash Equivalents                                           | 28,148 |  |   | 15,005 |  |   | (120,840 | ) |
| Cash and Cash Equivalents, January 1                                              | 73,312 |  |   | 58,307 |  |   | 179,147 |  |
| Cash and Cash Equivalents, December 31                                            | $ | 101,460 |  |   | $ | 73,312 |  |   | $ | 58,307 |  |
| Additional cash flows information:                                                |   |   |   |   |   |
| Interest paid                                                                     | $ | 24,697 |  |   | $ | 39,227 |  |   | $ | 57,458 |  |
| Income tax paid (refunded)                                                        | 11,738 |  |   | (2,977 | ) |   | (17,674 | ) |
| Exchange of preferred stock for trust preferred debt                              |   |   |  |  |   | 46,400 |  |
| Loans transferred to other real estate owned                                      | 4,441 |  |   | 14,188 |  |   | 32,950 |  |
| Non-cash investing activities using trade date accounting                         | 1,518 |  |   |  |  |   |  |  |
| Liabilities assumed, net of cash                                                  | 166,112 |  |  |  |  |  |  |  |

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|                                           |
|-------------------------------------------|
|                                           |  |  |  |  |  |  |  |  |
| Assets                                    |  |  |  | Liabilities |  |
| Cash and due from banks (1)               | $ | 29,113 |  |   | Deposits: |  |
| Investment securities, available for sale | 18,896 |  |   | Non-interest bearing | $ | 13,715 |  |
| Federal Home Loan Bank stock              | 1,761 |  |   | NOW accounts | 14,746 |  |
| Loans:                                    |   |  |   | Savings and money market | 25,843 |  |
| Commercial                                | 51,042 |  |   | Certificate of deposit | 71,605 |  |
| Residential mortgage                      | 11,181 |  |   | Total Deposits | 125,909 |  |
| Installment                               | 31,570 |  |   |   |   |  |
| Total Loans                               | 93,793 |  |   | Federal Home Loan Bank advances | 10,286 |  |
|                                      |   |  |   | Other liabilities | 804 |  |
| Premises                                  | 1,516 |  |   | Total Liabilities Assumed | $ | 136,999 |  |
| Core deposit intangible                   | 484 |  |   |   |   |  |
| Other assets                              | 560 |  |   | Net Gain on Acquisition | $ | 9,124 |  |
| Total Assets Purchased                    | $ | 146,123 |  |   |   |   |  |

|     |                                                       |
|-----|-------------------------------------------------------|
| (1) | Includes $17,200,000 cash received from the FDIC. |

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|                                                                                                         |
|---------------------------------------------------------------------------------------------------------|
|                                                                                                         |  |  |  |
| Preliminary estimate of contractually required principal and interest at acquisition                    | $ | 31,143 |  |
| Preliminary estimate of contractual cash flows not expected to be collected (nonaccretable differences) | 9,688 |  |
| Preliminary estimate of expected cash flows at acquisition                                              | 21,455 |  |
| Preliminary estimate of interest component of expected cash flows (accretable discount)                 | 4,152 |  |
| Preliminary estimate of fair value of acquired loans accounted for under ASC 310-30                     | $ | 17,303 |  |

|                                                                  |
|------------------------------------------------------------------|
|                                                                  |  |  |  |
|                                                             | December 31, |
|                                                             | 2012 |
| Commercial and industrial loans                                  | $ | 8,542 |  |
| Agricultural production financing and other farm loans           | 1,127 |  |
| Real estate loans                                                |  |  |
|      Construction                       | 58 |  |
|      Commercial and farmland            | 24,259 |  |
|      Residential                        | 12,118 |  |
|      Home Equity                        | 18,805 |  |
| Individuals' loans for household and other personal expenditures | 691 |  |
|    Total                                          | $ | 65,600 |  |

|                                      |
|--------------------------------------|
|                                      |  |  |  |
|                                 | Twelve Months Ended December 31, 2012 |
| Beginning balance, February 10, 2012 | $ | 9,774 |  |
| Accretions                           | (4,632 | ) |
| Ending Balance, December 31, 2012    | $ | 5,142 |  |

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|                                                      |
|------------------------------------------------------|
|                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                 | Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value |
| Available for sale at December 31, 2012              |   |   |   |   |   |   |   |
| U.S. Government-sponsored agency securities          | $ | 4,475 |  |  | $ | 165 |  |  |  |  | $ | 4,640 |  |
| State and municipal                                  | 148,187 |  |  | 10,025 |  |  | $ | 18 |  |  | 158,194 |  |
| U.S. Government-sponsored mortgage-backed securities | 337,631 |  |  | 10,994 |  |  | 46 |  |  | 348,579 |  |
| Corporate obligations                                | 6,105 |  |  |  |  | 5,881 |  |  | 224 |  |
| Equity securities                                    | 1,706 |  |  |  |  |  |  | 1,706 |  |
| Total available for sale                             | 498,104 |  |  | 21,184 |  |  | 5,945 |  |  | 513,343 |  |
| Held to maturity at December 31, 2012                |  |  |  |  |  |  |   |
| State and municipal                                  | 117,227 |  |  | 5,489 |  |  | 1 |  |  | 122,715 |  |
| U.S. Government-sponsored mortgage-backed securities | 243,793 |  |  | 11,681 |  |  | 15 |  |  | 255,459 |  |
| Total held to maturity                               | 361,020 |  |  | 17,170 |  |  | 16 |  |  | 378,174 |  |
| Total Investment Securities                          | $ | 859,124 |  |  | $ | 38,354 |  |  | $ | 5,961 |  |  | $ | 891,517 |  |
|                                                 |   |   |   |   |   |   |   |
| Available for sale at December 31, 2011              |   |   |   |   |   |   |   |
| U.S. Government-sponsored agency securities          | $ | 99 |  |   | $ | 18 |  |   |   |   | $ | 117 |  |
| State and municipal                                  | 136,857 |  |   | 10,496 |  |   |   |  |   | 147,353 |  |
| U.S. Government-sponsored mortgage-backed securities | 358,928 |  |   | 10,086 |  |   | $ | 16 |  |   | 368,998 |  |
| Corporate obligations                                | 5,765 |  |   |   |   | 5,572 |  |   | 193 |  |
| Equity securities                                    | 1,830 |  |   |   |   |   |   | 1,830 |  |
| Total available for sale                             | 503,479 |  |   | 20,600 |  |   | 5,588 |  |   | 518,491 |  |
| Held to maturity at December 31, 2011                |   |   |   |   |   |   |   |
| State and municipal                                  | 120,171 |  |   | 3,785 |  |   |   |  |   | 123,956 |  |
| U.S. Government-sponsored mortgage-backed securities | 307,738 |  |   | 10,775 |  |   |   |  |   | 318,513 |  |
| Total held to maturity                               | 427,909 |  |   | 14,560 |  |   |   |  |   | 442,469 |  |
| Total Investment Securities                          | $ | 931,388 |  |   | $ | 35,160 |  |   | $ | 5,588 |  |   | $ | 960,960 |  |

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|                                                                            |
|----------------------------------------------------------------------------|
|                                                                            |  |  |  |  |  |  |  |
|                                                                       | Accumulated Credit Losses in |   | Accumulated Credit Losses in |
|                                                                       | 2012 |   | 2011 |
| Credit losses on debt securities held:                                     |   |   |   |
| Balance, January 1                                                         | $ | 11,355 |  |   | $ | 10,955 |  |
| Additions related to other-than-temporary losses not previously recognized |  |  |   | 400 |  |
| Balance, December 31                                                       | $ | 11,355 |  |   | $ | 11,355 |  |

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|                                                      |
|------------------------------------------------------|
|                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                 | Fair Value |  | Gross Unrealized Losses |  | Fair Value |  | Gross Unrealized Losses |  | Fair Value |  | Gross Unrealized Losses |
|                                                 | Less than 12 Months |  | 12 Months or Longer |  | Total |
| Temporarily Impaired Investment                      |   |  |   |  |   |  |   |  |   |  |   |
| Securities at December 31, 2012                      |   |  |   |  |   |  |   |  |   |  |   |
| State and municipal                                  | $ | 4,524 |  |  | $ | 19 |  |  |  |  |  |  | $ | 4,524 |  |  | $ | 19 |  |
| U.S. Government-sponsored mortgage-backed securities | 12,320 |  |  | 61 |  |  |  |  |  |  | 12,320 |  |  | 61 |  |
| Corporate obligations                                |  |  |  |  | $ | 194 |  |  | $ | 5,881 |  |  | 194 |  |  | 5,881 |  |
| Total Temporarily Impaired Investment Securities     | $ | 16,844 |  |  | $ | 80 |  |  | $ | 194 |  |  | $ | 5,881 |  |  | $ | 17,038 |  |  | $ | 5,961 |  |
|                                                 |   |   |   |   |   |   |   |   |   |   |   |
| Temporarily Impaired Investment                      |   |  |   |  |   |  |   |  |   |  |   |
| Securities at December 31, 2011                      |   |  |   |  |   |  |   |  |   |  |   |
| U.S. Government-sponsored mortgage-backed securities | $ | 6,176 |  |  | $ | 16 |  |  |  |  |  |  |  | $ | 6,176 |  |  | $ | 16 |  |
| Corporate obligations                                |  |  |  |  | $ | 163 |  |  | $ | 5,572 |  |  | 163 |  |  | 5,572 |  |
| Total Temporarily Impaired Investment Securities     | $ | 6,176 |  |  | $ | 16 |  |  | $ | 163 |  |  | $ | 5,572 |  |  | $ | 6,339 |  |  | $ | 5,588 |  |

|                                                      |
|------------------------------------------------------|
|                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                 | Available for Sale |  | Held to Maturity |
|                                                 | Amortized Cost |  | Fair Value |  | Amortized Cost |  | Fair Value |
| Maturity Distribution at December 31, 2012           |   |  |   |  |   |  |   |
| Due in one year or less                              | $ | 4,366 |  |  | $ | 4,415 |  |  | $ | 2,590 |  |  | $ | 2,594 |  |
| Due after one through five years                     | 14,764 |  |  | 15,468 |  |  | 2,554 |  |  | 2,575 |  |
| Due after five through ten years                     | 54,148 |  |  | 57,442 |  |  | 57,811 |  |  | 60,163 |  |
| Due after ten years                                  | 85,489 |  |  | 85,733 |  |  | 54,272 |  |  | 57,383 |  |
|                                                 | $ | 158,767 |  |  | $ | 163,058 |  |  | $ | 117,227 |  |  | $ | 122,715 |  |
| U.S. Government-sponsored mortgage-backed securities | 337,631 |  |  | 348,579 |  |  | 243,793 |  |  | 255,459 |  |
| Equity securities                                    | 1,706 |  |  | 1,706 |  |  |  |  |  |
| Total Investment Securities                          | $ | 498,104 |  |  | $ | 513,343 |  |  | $ | 361,020 |  |  | $ | 378,174 |  |

----

Table of Contents

|                                                                  |
|------------------------------------------------------------------|
|                                                                  |  |  |  |  |  |  |  |
|                                                                  | December 31, 2012 |  | December 31, 2011 |
| Loans:                                                           |   |  |   |
| Commercial and industrial loans                                  | $ | 622,579 |  |  | $ | 532,523 |  |
| Agricultural production financing and other farm loans           | 112,527 |  |  | 104,526 |  |
| Real estate loans:                                               |  |  |   |
| Construction                                                     | 98,639 |  |  | 81,780 |  |
| Commercial and farmland                                          | 1,266,682 |  |  | 1,194,230 |  |
| Residential                                                      | 473,537 |  |  | 481,493 |  |
| Home Equity                                                      | 203,406 |  |  | 191,631 |  |
| Individual's loans for household and other personal expenditures | 75,748 |  |  | 84,172 |  |
| Lease financing receivables, net of unearned income              | 2,590 |  |  | 3,555 |  |
| Other loans                                                      | 46,501 |  |  | 39,505 |  |
| Loans                                                            | 2,902,209 |  |  | 2,713,415 |  |
| Allowance for loan losses                                        | (69,366 | ) |  | (70,898 | ) |
| Net Loans                                                        | $ | 2,832,843 |  |  | $ | 2,642,517 |  |

----

Table of Contents

|                             |
|-----------------------------|
|                             |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                        | Twelve Months Ended December 31, 2012 |
|                        | Commercial |  | Real Estate Commercial |  | Consumer |  | Residential |  | FinanceLeases |  | Total |
| Allowance for loan losses:  |   |  |   |  |   |  |   |  |   |  |   |
| Balances, January 1         | $ | 17,731 |  |  | $ | 37,919 |  |  | $ | 2,902 |  |  | $ | 12,343 |  |  | $ | 3 |  |  | $ | 70,898 |  |
| Provision for losses        | 14,749 |  |  | (2,546 | ) |  | 126 |  |  | 6,176 |  |  | 29 |  |  | 18,534 |  |
| Recoveries on loans         | 1,744 |  |  | 3,652 |  |  | 695 |  |  | 1,113 |  |  | 2 |  |  | 7,206 |  |
| Loans charged off           | (8,311 | ) |  | (12,322 | ) |  | (1,130 | ) |  | (5,475 | ) |  | (34 | ) |  | (27,272 | ) |
| Balances, December 31, 2012 | $ | 25,913 |  |  | $ | 26,703 |  |  | $ | 2,593 |  |  | $ | 14,157 |  |  |  |  |  | $ | 69,366 |  |

|                             |
|-----------------------------|
|                             |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                        | Twelve Months Ended December 31, 2011 |
|                        | Commercial |  | Real Estate Commercial |  | Consumer |  | Residential |  | FinanceLeases |  | Total |
| Allowance for loan losses:  |   |  |   |  |   |  |   |  |   |  |   |
| Balances, January 1         | $ | 32,508 |  |  | $ | 36,341 |  |  | $ | 3,622 |  |  | $ | 10,408 |  |  | $ | 98 |  |  | $ | 82,977 |  |
| Provision for losses        | (13,787 | ) |  | 28,574 |  |  | (221 | ) |  | 8,166 |  |  | (102 | ) |  | 22,630 |  |
| Recoveries on loans         | 8,828 |  |  | 2,811 |  |  | 942 |  |  | 1,176 |  |  | 7 |  |  | 13,764 |  |
| Loans charged off           | (9,818 | ) |  | (29,807 | ) |  | (1,441 | ) |  | (7,407 | ) |  |  |  |  | (48,473 | ) |
| Balances, December 31, 2011 | $ | 17,731 |  |  | $ | 37,919 |  |  | $ | 2,902 |  |  | $ | 12,343 |  |  | $ | 3 |  |  | $ | 70,898 |  |

----

Table of Contents

|                             |
|-----------------------------|
|                             |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                        | Twelve Months Ended December 31, 2010 |
|                        | Commercial |  | Real Estate Commercial |  | Consumer |  | Residential |  | FinanceLeases |  | Total |
| Allowance for loan losses:  |   |  |   |  |   |  |   |  |   |  |   |
| Balances, January 1         | $ | 48,770 |  |  | $ | 30,189 |  |  | $ | 2,242 |  |  | $ | 10,751 |  |  | $ | 179 |  |  | $ | 92,131 |  |
| Provision for losses        | (180 | ) |  | 37,555 |  |  | 2,868 |  |  | 6,267 |  |  | (27 | ) |  | 46,483 |  |
| Recoveries on loans         | 6,750 |  |  | 1,420 |  |  | 938 |  |  | 2,827 |  |  |  |  |  | 11,935 |  |
| Loans charged off           | (22,832 | ) |  | (32,823 | ) |  | (2,426 | ) |  | (9,437 | ) |  | (54 | ) |  | (67,572 | ) |
| Balances, December 31, 2010 | $ | 32,508 |  |  | $ | 36,341 |  |  | $ | 3,622 |  |  | $ | 10,408 |  |  | $ | 98 |  |  | $ | 82,977 |  |

|                                                 |
|-------------------------------------------------|
|                                                 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                 | December 31, 2012 |
|                                            | Commercial |  | CommercialReal Estate |  | Consumer |  | Residential |  | FinanceLeases |  | Total |
| Allowance Balances:                             |   |  |   |  |   |  |   |  |   |  |   |
| Individually evaluated for impairment           | $ | 1,628 |  |  | $ | 2,565 |  |  |  |  |  | $ | 50 |  |  |  |  | $ | 4,243 |  |
| Collectively evaluated for impairment           | 24,285 |  |  | 24,138 |  |  | $ | 2,593 |  |  | 14,107 |  |  |  |  |  | 65,123 |  |
| Loans Acquired with Deteriorated Credit Quality |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Total Allowance for Loan Losses                 | $ | 25,913 |  |  | $ | 26,703 |  |  | $ | 2,593 |  |  | $ | 14,157 |  |  |  |  | $ | 69,366 |  |
| Loan Balances:                                  |   |  |   |  |   |  |   |  |   |  |   |
| Individually evaluated for impairment           | $ | 14,190 |  |  | $ | 45,394 |  |  |  |  |  | $ | 8,515 |  |  |  |  | $ | 68,099 |  |
| Collectively evaluated for impairment           | 765,707 |  |  | 1,309,912 |  |  | $ | 75,748 |  |  | 667,401 |  |  | $ | 2,590 |  |  | 2,821,358 |  |
| Loans Acquired with Deteriorated Credit Quality | 1,710 |  |  | 10,015 |  |  |  |  |  | 1,027 |  |  |  |  |  | 12,752 |  |
| Loans                                           | $ | 781,607 |  |  | $ | 1,365,321 |  |  | $ | 75,748 |  |  | $ | 676,943 |  |  | $ | 2,590 |  |  | $ | 2,902,209 |  |

|                                       |
|---------------------------------------|
|                                       |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                       | December 31, 2011 |
|                                       | Commercial |  | CommercialReal Estate |  | Consumer |  | Residential |  | FinanceLeases |  | Total |
| Allowance Balances:                   |   |  |   |  |   |  |   |  |   |  |   |
| Individually evaluated for impairment | $ | 4,701 |  |  | $ | 2,504 |  |  |   |  | $ | 733 |  |  |   |  | $ | 7,938 |  |
| Collectively evaluated for impairment | 13,030 |  |  | 35,415 |  |  | $ | 2,902 |  |  | 11,610 |  |  | $ | 3 |  |  | 62,960 |  |
| Total Allowance for Loan Losses       | $ | 17,731 |  |  | $ | 37,919 |  |  | $ | 2,902 |  |  | $ | 12,343 |  |  | $ | 3 |  |  | $ | 70,898 |  |
| Loan Balances:                        |   |  |   |  |   |  |   |  |   |  |   |
| Individually evaluated for impairment | $ | 18,793 |  |  | $ | 51,980 |  |  |   |  | $ | 12,546 |  |  |   |  | $ | 83,319 |  |
| Collectively evaluated for impairment | 657,761 |  |  | 1,224,030 |  |  | $ | 84,172 |  |  | 660,578 |  |  | $ | 3,555 |  |  | 2,630,096 |  |
| Loans                                 | $ | 676,554 |  |  | $ | 1,276,010 |  |  | $ | 84,172 |  |  | $ | 673,124 |  |  | $ | 3,555 |  |  | $ | 2,713,415 |  |

|                                                                 |
|-----------------------------------------------------------------|
|                                                                 |  |  |  |  |  |  |  |
|                                                                 | December 31, 2012 |  | December 31, 2011 |
| Commercial and Industrial                                       | $ | 12,195 |  |  | $ | 12,246 |  |
| Real Estate Loans:                                              |  |  |   |
| Construction                                                    | 4,814 |  |  | 8,990 |  |
| Commercial and farmland                                         | 22,612 |  |  | 31,093 |  |
| Residential                                                     | 11,476 |  |  | 14,805 |  |
| Home Equity                                                     | 1,997 |  |  | 1,896 |  |
| Individuals loans for household and other personal expenditures |  |  |  | 1 |
| Lease financing receivables, net of unearned income             | 301 |  |  |  |
| Other Loans                                                     | 4 |  |  | 561 |
| Total                                                           | $ | 53,399 |  |  | $ | 69,592 |  |

----

Table of Contents

|                                           |
|-------------------------------------------|
|                                           |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                      | December 31, 2012 |
|                                      | Unpaid PrincipalBalance |  | RecordedInvestment |  | RelatedAllowance |  | Average Recorded Investment |  | Interest Income Recognized |
| Impaired loans with no related allowance: |   |  |   |  |   |  |   |  |   |
| Commercial and industrial                 | $ | 28,532 |  |  | $ | 11,730 |  |  |   |  | $ | 15,089 |  |  | $ | 124 |  |
| Real Estate Loans:                        |   |  |   |  |   |  |   |  |   |
| Construction                              | 9,787 |  |  | 5,164 |  |  |   |  | 6,471 |  |  | 66 |  |
| Commercial and farmland                   | 58,173 |  |  | 43,204 |  |  |   |  | 46,788 |  |  | 1,211 |  |
| Residential                               | 8,820 |  |  | 6,215 |  |  |   |  | 7,129 |  |  | 83 |  |
| Home equity                               | 4,199 |  |  | 1,006 |  |  |   |  | 1,022 |  |  | 13 |  |
| Other loans                               | 83 |  |  | 14 |  |  |   |  | 18 |  |  | 1 |  |
| Total                                     | $ | 109,594 |  |  | $ | 67,333 |  |  |   |  | $ | 76,517 |  |  | $ | 1,498 |  |
| Impaired loans with related allowance:    |   |  |   |  |   |  |   |  |   |
| Commercial and industrial                 | $ | 4,415 |  |  | $ | 4,155 |  |  | $ | 1,628 |  |  | $ | 4,225 |  |  | $ | 33 |  |
| Real Estate Loans:                        |   |  |   |  |   |  |   |  |   |
| Construction                              | 1,202 |  |  | 1,058 |  |  | 105 |  |  | 1,175 |  |  |   |
| Commercial and farmland                   | 5,579 |  |  | 5,182 |  |  | 2,460 |  |  | 5,239 |  |  | 95 |  |
| Residential                               | 1,722 |  |  | 1,451 |  |  | 50 |  |  | 1,458 |  |  | 75 |  |
| Total                                     | $ | 12,918 |  |  | $ | 11,846 |  |  | $ | 4,243 |  |  | $ | 12,097 |  |  | $ | 203 |  |
| Total Impaired Loans                      | $ | 122,512 |  |  | $ | 79,179 |  |  | $ | 4,243 |  |  | $ | 88,614 |  |  | $ | 1,701 |  |

|                                           |
|-------------------------------------------|
|                                           |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                      | December 31, 2011 |
|                                      | Unpaid PrincipalBalance |  | RecordedInvestment |  | RelatedAllowance |  | Average Recorded Investment |  | Interest Income Recognized |
| Impaired loans with no related allowance: |   |  |   |  |   |  |   |  |   |
| Commercial and industrial                 | $ | 23,364 |  |  | $ | 10,116 |  |  |   |  | $ | 13,399 |  |  | $ | 615 |  |
| Real Estate Loans:                        |   |  |   |  |   |  |   |  |   |
| Construction                              | 14,301 |  |  | 7,701 |  |  |   |  | 8,836 |  |  |   |
| Commercial and farmland                   | 49,242 |  |  | 34,571 |  |  |   |  | 39,032 |  |  | 591 |  |
| Residential                               | 7,491 |  |  | 6,185 |  |  |   |  | 6,539 |  |  | 20 |  |
| Home equity                               | 4,425 |  |  | 1,241 |  |  |   |  | 1,500 |  |  | 15 |  |
| Other loans                               | 99 |  |  | 21 |  |  |   |  | 24 |  |  |  |
| Total                                     | $ | 98,922 |  |  | $ | 59,835 |  |  |   |  | $ | 69,330 |  |  | $ | 1,241 |  |
| Impaired loans with related allowance:    |   |  |   |  |   |  |   |  |   |
| Commercial and industrial                 | $ | 8,691 |  |  | $ | 8,104 |  |  | $ | 4,142 |  |  | $ | 8,196 |  |  | $ | 174 |  |
| Real Estate Loans:                        |   |  |   |  |   |  |   |  |   |
| Construction                              | 961 |  |  | 961 |  |  | 321 |  |  | 961 |  |  |   |
| Commercial and farmland                   | 12,115 |  |  | 8,748 |  |  | 2,183 |  |  | 10,028 |  |  | 140 |  |
| Residential                               | 1,888 |  |  | 1,575 |  |  | 391 |  |  | 1,687 |  |  | 7 |  |
| Other loans                               | 579 |  |  | 552 |  |  | 559 |  |  | 590 |  |  |   |
| Total                                     | $ | 24,234 |  |  | $ | 19,940 |  |  | $ | 7,596 |  |  | $ | 21,462 |  |  | $ | 321 |  |
| Total Impaired Loans                      | $ | 123,156 |  |  | $ | 79,775 |  |  | $ | 7,596 |  |  | $ | 90,792 |  |  | $ | 1,562 |  |

----

Table of Contents

|                                                                                                                    |
|--------------------------------------------------------------------------------------------------------------------|
|                                                                                                                    |  |  |  |  |  |  |  |  |  |  |  |
|                                                                                                               | December 31, 2010 |
|                                                                                                               | Unpaid Principal Balance |  | Recorded Investment |  | Related Allowance |
| Impaired loans with no related allowance:                                                                          |   |  |  |  |  |
|           Commercial and industrial                              | $ | 30,006 |  |  | $ | 16,572 |  |  |  |
|                other loans to farmers   | 966 |  |  | 530 |  |  |  |
|           Real Estate Loans:                                     |   |  |  |  |  |
|                Construction             | 12,598 |  |  | 9,150 |  |  |  |
|                Commercial and farm land | 64,064 |  |  | 43,653 |  |  |  |
|                Residential              | 7,909 |  |  | 5,153 |  |  |  |
|                Home equity              | 4,460 |  |  | 1,245 |  |  |  |
|           Other loans                                            | 101 |  |  | 14 |  |  |  |
|                   Total  | $ | 120,104 |  |  | $ | 76,317 |  |  |  |
|                                                                                                               |   |  |  |  |  |
| Impaired loans with related allowance:                                                                             |   |  |  |  |  |
|           Commercial and industrial                              | $ | 11,477 |  |  | $ | 11,374 |  |  | $ | 5,250 |  |
|           Real Estate Loans:                                     |   |  |  |  |  |
|                Construction             | 9,353 |  |  | 7,824 |  |  | 2,049 |  |
|                Commercial and farm land | 17,984 |  |  | 17,076 |  |  | 5,496 |  |
|                Residential              | 2,740 |  |  | 2,691 |  |  | 465 |  |
|                Home equity              | 458 |  |  | 446 |  |  | 178 |  |
|           Other loans                                            | 476 |  |  | 476 |  |  | 476 |  |
|                   Total  | $ | 42,488 |  |  | $ | 39,887 |  |  | $ | 13,914 |  |
| Total Impaired Loans                                                                                               | $ | 162,592 |  |  | $ | 116,204 |  |  | $ | 13,914 |  |

|         |                                                                      |
|---------|----------------------------------------------------------------------|
| • | Pass - Loans that are considered to be of acceptable credit quality. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Special Mention - Loans which possess some credit deficiency or potential weakness, which deserves close attention.  If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in the Corporation's credit position at some future date.  Special mention assets are not adversely classified and do not expose the Corporation to sufficient risk to warrant adverse classification.  The key distinctions of this category's classification are that it is indicative of an unwarranted level of risk; and weaknesses are considered “potential”, not “defined”, impairments to the primary source of repayment. Examples include businesses that may be suffering from inadequate management, loss of key personnel or significant customer or litigation. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Substandard - A substandard loan is inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any.  Assets so classified have a well-defined weakness that jeopardizes the liquidation of the debt.  They are characterized by the distinct possibility that the Corporation will sustain some loss if the deficiencies are not corrected.  Other characteristics may include: |

|        |
|--------|
|        |  |  |
|   | o | the likelihood that a loan will be paid from the primary source of repayment is uncertain or financial deterioration is underway and very close attention is warranted to ensure that the loan is collected without loss, |

|        |
|--------|
|        |  |  |
|   | o | the primary source of repayment is gone, and the Corporation is forced to rely on a secondary source of repayment, such as collateral liquidation or guarantees, |

|        |
|--------|
|        |  |  |
|   | o | loans have a distinct possibility that the Corporation will sustain some loss if deficiencies are not corrected, |

|        |
|--------|
|        |  |  |
|   | o | unusual courses of action are needed to maintain a high probability of repayment, |

|        |
|--------|
|        |  |  |
|   | o | the borrower is not generating enough cash flow to repay loan principal; however, it continues to make interest payments, |

|        |
|--------|
|        |  |  |
|   | o | the Corporation is forced into a subordinated or unsecured position due to flaws in documentation, |

----

Table of Contents

|        |
|--------|
|        |  |  |
|   | o | loans have been restructured so that payment schedules, terms and collateral represent concessions to the borrower when compared to the normal loan terms, |

|        |
|--------|
|        |  |  |
|   | o | the Corporation is seriously contemplating foreclosure or legal action due to the apparent deterioration of the loan, and |

|        |
|--------|
|        |  |  |
|   | o | there is significant deterioration in market conditions to which the borrower is highly vulnerable. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Doubtful - Loans that have all of the weaknesses of those classified as Substandard.  However, based on currently existing facts, conditions and values, these weaknesses make full collection of principal highly questionable and improbable. Other credit characteristics may include the primary source of repayment is gone or there is considerable doubt as to the quality of the secondary sources of repayment. The possibility of loss is high, but because of certain important pending factors that may strengthen the loan, loss classification is deferred until the exact status of repayment is known. |

|         |                                                                                                                                                                                                                                                                                                                                                                                   |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Loss – Loans that are considered uncollectible and of such little value that continuing to carry them as an asset is not warranted. Loans will be classified as Loss when it is neither practical not desirable to defer writing off or reserving all or a portion of a basically worthless asset, even though partial recovery may be possible at some time in the future. |

|                                                                 |
|-----------------------------------------------------------------|
|                                                                 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                            | December 31, 2012 |
|                                                            | Commercial Pass |  | Commercial Special Mention |  | Commercial Substandard |  | Commercial Doubtful |  | Commercial Loss |  | Consumer Performing |  | ConsumerNon Performing |  | Total |
| Commercial and Industrial                                       | $ | 559,852 |  |  | $ | 23,678 |  |  | $ | 34,460 |  |  | $ | 4,589 |  |  |   |  |   |  |   |  | $ | 622,579 |  |
| Agriculture production financing and other farm loans           | 112,209 |  |  | 224 |  |  | 94 |  |  |  |  |   |  |   |  |   |  | 112,527 |  |
| Real Estate Loans:                                              |  |  |   |  |   |  |   |  |   |  |   |  |   |  |  |
| Construction                                                    | 85,728 |  |  | 1,384 |  |  | 11,356 |  |  |  |  |   |  |  |  |  | 171 |  |  | 98,639 |  |
| Commercial and farmland                                         | 1,148,561 |  |  | 38,199 |  |  | 79,078 |  |  | 553 |  |  |   |  |  |  |  | 291 |  |  | 1,266,682 |  |
| Residential                                                     | 145,402 |  |  | 5,437 |  |  | 13,880 |  |  | 922 |  |  |   |  | 301,614 |  |  | 6,282 |  |  | 473,537 |  |
| Home Equity                                                     | 9,092 |  |  | 893 |  |  | 1,657 |  |  |  |  |   |  | 189,721 |  |  | 2,043 |  |  | 203,406 |  |
| Individuals loans for household and other personal expenditures |   |  |   |  |   |  |   |  |   |  | 75,748 |  |  |  |  |  | 75,748 |  |
| Lease financing receivables, net of unearned income             |  |  |  |  |  |  |  |  |   |  | 2,289 |  |  | 301 |  |  | 2,590 |  |
| Other Loans                                                     | 46,473 |  |  |  |  |  | 28 |  |  |  |  |  |   |  |  |  |  |  | 46,501 |  |
| Loans                                                           | $ | 2,107,317 |  |  | $ | 69,815 |  |  | $ | 140,553 |  |  | $ | 6,064 |  |  |                          |  | $ | 569,372 |  |  | $ | 9,088 |  |  | $ | 2,902,209 |  |

|                                                                 |
|-----------------------------------------------------------------|
|                                                                 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                            | December 31, 2011 |
|                                                            | Commercial Pass |  | Commercial Special Mention |  | Commercial Substandard |  | Commercial Doubtful |  | Commercial Loss |  | Consumer Performing |  | ConsumerNon Performing |  | Total |
| Commercial and Industrial                                       | $ | 478,885 |  |  | $ | 22,405 |  |  | $ | 28,025 |  |  | $ | 3,208 |  |  |   |  |   |  |   |  | $ | 532,523 |  |
| Agriculture production financing and other farm loans           | 101,289 |  |  | 1,582 |  |  | 1,655 |  |  |   |  |   |  |   |  |   |  | 104,526 |  |
| Real Estate Loans:                                              |   |  |   |  |   |  |   |  |   |  |   |  |   |  |  |
| Construction                                                    | 47,611 |  |  | 3,672 |  |  | 22,376 |  |  |   |  |   |  | $ | 7,762 |  |  | $ | 359 |  |  | 81,780 |  |
| Commercial and farmland                                         | 1,033,397 |  |  | 54,697 |  |  | 103,330 |  |  | 1,724 |  |  |   |  | 1,035 |  |  | 47 |  |  | 1,194,230 |  |
| Residential                                                     | 139,237 |  |  | 9,175 |  |  | 16,699 |  |  | 500 |  |  |   |  | 308,306 |  |  | 7,576 |  |  | 481,493 |  |
| Home Equity                                                     | 15,912 |  |  | 499 |  |  | 3,317 |  |  |   |  |   |  | 170,776 |  |  | 1,127 |  |  | 191,631 |  |
| Individuals loans for household and other personal expenditures |   |  |   |  |   |  |   |  |   |  | 84,121 |  |  | 51 |  |  | 84,172 |  |
| Lease financing receivables, net of unearned income             |   |  |   |  |   |  |   |  |   |  | 3,555 |  |  |   |  | 3,555 |  |
| Other Loans                                                     | 38,917 |  |  | 15 |  |  | 21 |  |  | 552 |  |  |   |  |   |  |   |  | 39,505 |  |
| Loans                                                           | $ | 1,855,248 |  |  | $ | 92,045 |  |  | $ | 175,423 |  |  | $ | 5,984 |  |  |                          |  | $ | 575,555 |  |  | $ | 9,160 |  |  | $ | 2,713,415 |  |

----

Table of Contents

|                                                                 |
|-----------------------------------------------------------------|
|                                                                 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                                 | December 31, 2012 |
|                                                            | Current |  | 30-59 DaysPast Due |  | 60-89 DaysPast Due |  | Loans > 90 DaysAnd Accruing |  | Non-Accrual |  | Total Past Due& Non-Accrual |  | Total |
| Commercial and industrial                                       | $ | 607,442 |  |  | $ | 2,628 |  |  | $ | 144 |  |  | $ | 170 |  |  | $ | 12,195 |  |  | $ | 15,137 |  |  | $ | 622,579 |  |
| Agriculture production financing and other farm loans           | 112,527 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 112,527 |  |
| Real Estate Loans:                                              |   |  |   |  |   |  |   |  |   |  |   |  |   |
| Construction                                                    | 93,426 |  |  | 399 |  |  |   |  |   |  | 4,814 |  |  | 5,213 |  |  | 98,639 |  |
| Commercial and farmland                                         | 1,238,907 |  |  | 3,276 |  |  | 1,822 |  |  | 65 |  |  | 22,612 |  |  | 27,775 |  |  | 1,266,682 |  |
| Residential                                                     | 453,743 |  |  | 5,734 |  |  | 1,338 |  |  | 1,246 |  |  | 11,476 |  |  | 19,794 |  |  | 473,537 |  |
| Home equity                                                     | 199,063 |  |  | 1,467 |  |  | 323 |  |  | 556 |  |  | 1,997 |  |  | 4,343 |  |  | 203,406 |  |
| Individuals loans for household and other personal expenditures | 74,919 |  |  | 799 |  |  | 30 |  |  |   |  |  |  |  | 829 |  |  | 75,748 |  |
| Lease financing receivables, net of unearned income             | 2,289 |  |  |   |  |   |  |   |  | 301 |  |  | 301 |  |  | 2,590 |  |
| Other loans                                                     | 46,497 |  |  |   |  |   |  |   |  | 4 |  |  | 4 |  |  | 46,501 |  |
| Loans                                                           | $ | 2,828,813 |  |  | $ | 14,303 |  |  | $ | 3,657 |  |  | $ | 2,037 |  |  | $ | 53,399 |  |  | $ | 73,396 |  |  | $ | 2,902,209 |  |

|                                                                 |
|-----------------------------------------------------------------|
|                                                                 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                                 | December 31, 2011 |
|                                                            | Current |  | 30-59 DaysPast Due |  | 60-89 DaysPast Due |  | Loans > 90 DaysAnd Accruing |  | Non-Accrual |  | Total Past Due& Non-Accrual |  | Total |
| Commercial and industrial                                       | $ | 518,764 |  |  | $ | 1,332 |  |  | $ | 135 |  |  | $ | 46 |  |  | $ | 12,246 |  |  | $ | 13,759 |  |  | $ | 532,523 |  |
| Agriculture production financing and other farm loans           | 104,464 |  |  | 62 |  |  |  |  |  |  |  |  |  |  | 62 |  |  | 104,526 |  |
| Real Estate Loans:                                              |   |  |   |  |   |  |   |  |   |  |   |  |   |
| Construction                                                    | 69,305 |  |  | 328 |  |  | 3,126 |  |  | 31 |  |  | 8,990 |  |  | 12,475 |  |  | 81,780 |  |
| Commercial and farmland                                         | 1,140,897 |  |  | 16,457 |  |  | 5,783 |  |  |  |  |  | 31,093 |  |  | 53,333 |  |  | 1,194,230 |  |
| Residential                                                     | 458,925 |  |  | 5,485 |  |  | 2,087 |  |  | 191 |  |  | 14,805 |  |  | 22,568 |  |  | 481,493 |  |
| Home equity                                                     | 187,788 |  |  | 1,096 |  |  | 590 |  |  | 261 |  |  | 1,896 |  |  | 3,843 |  |  | 191,631 |  |
| Individuals loans for household and other personal expenditures | 82,837 |  |  | 1,075 |  |  | 208 |  |  | 51 |  |  | 1 |  |  | 1,335 |  |  | 84,172 |  |
| Lease financing receivables, net of unearned income             | 3,555 |  |  |   |  |   |  |   |  |  |  |  |  |  |  | 3,555 |  |
| Other loans                                                     | 38,944 |  |  |  |  |  |  |  |  | 561 |  |  | 561 |  |  | 39,505 |  |
| Loans                                                           | $ | 2,605,479 |  |  | $ | 25,835 |  |  | $ | 11,929 |  |  | $ | 580 |  |  | $ | 69,592 |  |  | $ | 107,936 |  |  | $ | 2,713,415 |  |

----

Table of Contents

|                                                                 |
|-----------------------------------------------------------------|
|                                                                 |  |  |  |  |  |  |  |  |  |  |
|                                                            | December 31, 2012 |
|                                                                 | Pre-ModificationRecorded Balance |  | Post-ModificationRecorded Balance |  | Numberof Loans |
| Commercial and Industrial                                       | $ | 1,562 |  |  | $ | 1,547 |  |  | 9 |  |
| Real Estate Loans:                                              |   |  |   |  |   |
| Construction                                                    | 794 |  |  | 653 |  |  | 2 |  |
| Commercial and farmland                                         | 10,366 |  |  | 10,154 |  |  | 14 |  |
| Residential                                                     | 2,302 |  |  | 2,172 |  |  | 20 |  |
| Individuals loans for household and other personal expenditures | 170 |  |  | 197 |  |  | 5 |  |
| Total                                                           | $ | 15,194 |  |  | $ | 14,723 |  |  | 50 |  |

|                                                                 |
|-----------------------------------------------------------------|
|                                                                 |  |  |  |  |  |  |  |  |  |  |
|                                                            | December 31, 2011 |
|                                                                 | Pre-ModificationRecorded Balance |  | Post-ModificationRecorded Balance |  | Numberof Loans |
| Commercial and Industrial                                       | $ | 4,023 |  |  | $ | 4,033 |  |  | 17 |  |
| Real Estate Loans:                                              |  |  |   |  |   |
| Construction                                                    | 791 |  |  | 726 |  |  | 5 |  |
| Commercial and farmland                                         | 17,297 |  |  | 15,260 |  |  | 19 |  |
| Residential                                                     | 6,892 |  |  | 7,076 |  |  | 52 |  |
| Individuals loans for household and other personal expenditures | 90 |  |  | 94 |  |  | 9 |  |
| Other Loans                                                     | 12 |  |  | 12 |  |  | 1 |  |
| Total                                                           | $ | 29,105 |  |  | $ | 27,201 |  |  | 103 |  |

|                                                                 |
|-----------------------------------------------------------------|
|                                                                 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                            | December 31, 2012 |
|                                                                 | TermModification |  | RateModification |  | Combination |  | TotalModification |
| Commercial and Industrial                                       | $ | 259 |  |  |  |  | $ | 1,029 |  |  | $ | 1,288 |  |
| Real Estate Loans:                                              |   |  |   |  |   |  |   |
| Construction                                                    |  |  |  |  |  |  | 625 |  |  | 625 |  |
| Commercial and farmland                                         | 6,668 |  |  | $ | 903 |  |  | 381 |  |  | 7,952 |  |
| Residential                                                     | 525 |  |  | 380 |  |  | 995 |  |  | 1,900 |  |
| Individuals loans for household and other personal expenditures |  |  | 7 |  |  | 183 |  |  | 190 |  |
| Total                                                           | $ | 7,452 |  |  | $ | 1,290 |  |  | $ | 3,213 |  |  | $ | 11,955 |  |

|                           |
|---------------------------|
|                           |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                      | December 31, 2011 |
|                           | TermModification |  | RateModification |  | Combination |  | TotalModification |
| Commercial and Industrial | $ | 3,816 |  |  |  |  | $ | 118 |  |  | $ | 3,934 |  |
| Real Estate Loans:        |   |  |   |  |   |  |   |
| Construction              | 581 |  |  | $ | 125 |  |  | 17 |  |  | 723 |  |
| Commercial and farmland   | 10,338 |  |  | 954 |  |  | 2,810 |  |  | 14,102 |  |
| Residential               | 5,610 |  |  | 99 |  |  | 1,022 |  |  | 6,731 |  |
| Home Equity               | 55 |  |  |  |  | 34 |  |  | 89 |  |
| Other Loans               | 12 |  |  |  |  |  |  | 12 |  |
| Total                     | $ | 20,412 |  |  | $ | 1,178 |  |  | $ | 4,001 |  |  | $ | 25,591 |  |

----

Table of Contents

|                           |
|---------------------------|
|                           |  |  |  |  |  |  |
|                           | Twelve Months Ended December 31, 2012 |
|                      | Number of Loans |  | Recorded Balance |
| Commercial and Industrial | 1 |  |  | $ | 23 |  |
| Real Estate Loans:        |  |  |  |
| Commercial and farmland   | 2 |  |  | 212 |  |
| Residential               | 4 |  |  | 385 |  |
| Total                     | 7 |  |  | $ | 620 |  |

|                                                                 |
|-----------------------------------------------------------------|
|                                                                 |  |  |  |  |  |  |
|                                                                 | Twelve Months Ended December 31, 2011 |
|                                                            | Number of Loans |  | Recorded Balance |
| Commercial and Industrial                                       | 3 |  |  | $ | 471 |  |
| Real Estate Loans:                                              |  |  |  |
| Commercial and farmland                                         | 3 |  |  | 1,951 |  |
| Residential                                                     | 7 |  |  | 557 |  |
| Individuals loans for household and other personal expenditures | 1 |  |  | 5 |  |
| Total                                                           | 14 |  |  | $ | 2,984 |  |

|                                           |
|-------------------------------------------|
|                                           |  |  |  |  |  |  |  |
|                                      | 2012 |   | 2011 |
| Cost at December 31:                      |   |   |   |
| Land                                      | $ | 14,692 |  |   | $ | 14,296 |  |
| Buildings and Leasehold Improvements      | 62,606 |  |   | 62,317 |  |
| Equipment                                 | 42,564 |  |   | 39,789 |  |
| Total Cost                                | 119,862 |  |   | 116,402 |  |
| Accumulated Depreciation and Amortization | (67,113 | ) |   | (65,389 | ) |
| Net                                       | $ | 52,749 |  |   | $ | 51,013 |  |

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Table of Contents

|                                  |
|----------------------------------|
|                                  |  |  |  |
|                             | Future Minimum Rental Commitments |
| 2013                             | $ | 2,284 |  |
| 2014                             | 2,025 |  |
| 2015                             | 1,852 |  |
| 2016                             | 1,441 |  |
| 2017                             | 865 |  |
| After 2017                       | 1,428 |  |
| Total Future Minimum Obligations | $ | 9,895 |  |

|                                                        |
|--------------------------------------------------------|
|                                                        |  |  |  |  |  |  |  |
|                                                   | 2012 |  | 2011 |
| Gross carrying amount                                  | $ | 45,422 |  |  | $ | 45,422 |  |
| Core deposit intangible and other intangibles acquired | 967 |  |  |  |  |
| Accumulated amortization                               | (38,235 | ) |  | (36,308 | ) |
| Core Deposit and Other Intangibles                     | $ | 8,154 |  |  | $ | 9,114 |  |

|                                  |
|----------------------------------|
|                                  |  |  |  |
|                             | Amortization Expense |
| 2013                             | $ | 1,536 |  |
| 2014                             | 1,531 |  |
| 2015                             | 1,530 |  |
| 2016                             | 1,490 |  |
| 2017                             | 1,429 |  |
| After 2017                       | 638 |  |
| Total Future Minimum Obligations | $ | 8,154 |  |

----

Table of Contents

|                                                          |
|----------------------------------------------------------|
|                                                          |  |  |  |  |  |  |  |
|                                                          | December 31, 2012 |   | December 31, 2011 |
| Demand Deposits                                          | $ | 1,646,756 |  |  | $ | 1,438,513 |  |
| Savings Deposits                                         | 831,952 |  |  | 757,166 |  |
| Certificates and Other Time Deposits of $100,000 or more | 236,470 |  |  | 264,787 |  |
| Other Certificates and Time Deposits                     | 502,927 |  |  | 551,247 |  |
| Brokered Deposits                                        | 128,278 |  |  | 122,942 |  |
| Total Deposits                                           | $ | 3,346,383 |  |  | $ | 3,134,655 |  |

|            |
|------------|
|            |  |  |  |
|            | Certificates and Other Time Deposits |
| 2013       | $ | 539,426 |  |
| 2014       | 163,982 |  |
| 2015       | 54,995 |  |
| 2016       | 61,048 |  |
| 2017       | 28,138 |  |
| After 2017 | 20,086 |  |
|       | $ | 867,675 |  |

|                                             |
|---------------------------------------------|
|                                             |  |  |  |  |  |  |  |
|                                             | December 31, 2012 |  | December 31, 2011 |
| Federal Funds Purchased                     | $ | 18,862 |  |  |  |  |
| Securities Sold Under Repurchase Agreements | 141,828 |  |  | $ | 156,305 |  |
| Federal Home Loan Bank Advances             | 94,238 |  |  | 138,095 |  |
| Subordinated Debentures and Term Loans      | 112,161 |  |  | 194,974 |  |
| Total Borrowings                            | $ | 367,089 |  |  | $ | 489,374 |  |

|                                         |
|-----------------------------------------|
|                                         |  |  |  |  |  |  |  |  |  |  |  |
| Maturities in Years Ending December 31: | Securities SoldUnder Repurchase Agreements |  | Federal HomeLoan BankAdvances |  | SubordinatedDebentures andTerm Loans |
| 2013                                    | $ | 131,828 |  |  | $ | 1,619 |  |  | $ | 459 |  |
| 2014                                    | 10,000 |  |  | 26,506 |  |  |  |
| 2015                                    |  |  |  | 30,986 |  |  | 55,000 |  |
| 2016                                    |  |  | 28,933 |  |  |  |  |
| 2017                                    |  |  | 2,731 |  |  |  |
| After 2017                              |  |  | 3,463 |  |  | 56,702 |  |
|                                    | $ | 141,828 |  |  | $ | 94,238 |  |  | $ | 112,161 |  |

----

Table of Contents

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | First Merchants Capital Trust II. The subordinated debenture, entered into on July 2, 2007, for $56,702,000 will mature on September 15, 2037. The Corporation could not redeem the debenture prior to September 15, 2012, and redemption is subject to the prior approval of the Board of Governors of the Federal Reserve System, as required by law or regulation. Interest was fixed at 6.495 percent for the period from the date of issuance through September 15, 2012; interest is now an annual floating rate equal to the three-month LIBOR plus 1.56 percent, reset quarterly. Interest is payable in March, June, September and December of each year. The Corporation holds all of the outstanding common securities of First Merchants Capital Trust II. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Bank of America, N.A. The Corporation currently has a $55 million credit facility with Bank of America, N.A. comprised of (a) a term loan in the principal amount of $5 million (the “Term Loan”) and (b) a subordinated debenture in the principal amount of $50 million (the “Subordinated Debt”).  Pursuant to the terms of the underlying Loan Agreement (the “Loan Agreement”), the Term Loan and the Subordinated Debt each mature on February 15, 2015.  The Term Loan is secured by a pledge of all of the issued and outstanding shares of the Bank. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                   |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | CNBC Statutory Trust I. As part of the March 1, 2003, acquisition of CNBC Bancorp, the Corporation assumed $4,124,000 of a junior subordinated debenture entered into on February 22, 2001.  On August 22, 2012, the Corporation exercised its option to redeem the $4,124,000 subordinated debt. The redemption price premium was 104.59. The debenture carried a fixed interest rate of 10.2. |

|         |                                                                                                                                                                                                                                                                                                                                                                                         |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Temporary Liquidity Guarantee Program. On March 31, 2009, the Bank, entered into $79,000,000 of 2.625 percent Senior Notes (the “Notes”) due on March 30, 2012 through a pooled offering. On March 30, 2012, the Bank completed repayment of these Notes, which were guaranteed by the FDIC under its Temporary Liquidity Guarantee Program ("TLGP"). |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | First Merchants Capital Trust III. The Corporation entered into a junior subordinated debenture on June 30, 2010 for $47,835,000, subsequent to an Exchange Agreement with the United States Department of the Treasury (the "Treasury") whereby the Treasury exchanged 46,400 shares of the Corporation's Preferred Stock for 46,400 shares of trust preferred securities, issued by First Merchants Capital Trust III. The Trust used 46,400 shares of tendered preferred stock and $1.4 million in proceeds from the sale of Common Securities to the Corporation to purchase the debentures. On September 22, 2011, the Corporation redeemed the Capital Securities and Debentures pursuant to a Repurchase Letter agreement with the Treasury.  For more information related to this debt repayment, see Note 14.  Stockholders' Equity in the Notes to Consolidated Condensed Financial Statements of the 2011 Annual Report on Form 10-K. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | First Merchants Capital Trust II. The subordinated debenture, entered into on July 2, 2007, for $56,702,000 will mature on September 15, 2037. The Corporation may redeem the debenture no earlier than September 15, 2012, subject to the prior approval of the Board of Governors of the Federal Reserve System, as required by law or regulation. Interest is fixed at 6.495 percent for the period from the date of issuance through September 15, 2012, and thereafter, at an annual floating rate equal to the three-month LIBOR plus 1.56 percent, reset quarterly. Interest is payable in March, June, September and December of each year. The Corporation holds all of the outstanding common securities of First Merchants Capital Trust II |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | CNBC Statutory Trust I. As part of the March 1, 2003 acquisition of CNBC Bancorp, the Corporation assumed $4,124,000 of a junior subordinated debenture entered into on February 22, 2001. The subordinated debenture of $4,124,000 will mature on February 22, 2031. Interest is fixed at 10.2 percent and payable on February 22 and August 22 of each year. The Corporation may redeem the debenture, in whole or in part, at its option commencing February 22, 2011, at a redemption price of 105.1 percent of the outstanding principal amount and, thereafter, at a premium which declines annually. On or after February 22, 2021, the securities may be redeemed at face value with prior approval of the Board of Governors of the Federal Reserve System. The Corporation holds all of the outstanding common securities of CNBC Statutory Trust I. |

----

Table of Contents

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Bank of America, N.A. The Corporation currently has a $55 million credit facility with Bank of America, N.A. comprised of (a) a term loan in the principal amount of $5 million (the “Term Loan”) and (b) a subordinated debenture in the principal amount of $50 million (the “Subordinated Debt”).  Pursuant to the terms of the underlying Loan Agreement (the “Loan Agreement”), the Term Loan and the Subordinated Debt each mature on February 15, 2015.  The Term Loan is secured by a pledge of all of the issued and outstanding shares of the Bank. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Temporary Liquidity Guarantee Program. On March 31, 2009, the Bank, entered into $79,000,000 of 2.625 percent Senior Notes (the “Notes”) due on March 30, 2012 through a pooled offering. Including the FDIC fee, underwriting, legal and accounting expenses, the effective rate is 3.812 percent. The Notes are guaranteed by the Federal Deposit Insurance Corporation under its Temporary Liquidity Guarantee Program and are backed by the full faith and credit of the United States. The Notes are issued by the Bank and are not an obligation of, or guaranteed by, the Corporation. In connection with the FDIC's Temporary Liquidity Guarantee Program, the Bank entered into a Master Agreement with the FDIC on January 16, 2009. The Master Agreement contains, among other things, certain terms and conditions that must be included in the governing documents for any senior debt securities issued by the Bank that is guaranteed pursuant to the FDIC's Temporary Liquidity Guarantee Program. |

|                                                    |
|----------------------------------------------------|
|                                                    |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                               | Asset Derivatives |  | Liability Derivatives |
|                                               | December 31, 2012 |  | December 31, 2011 |  | December 31, 2012 |  | December 31, 2011 |
|                                               | Balance Sheet Location |  | FairValue |  | Balance Sheet Location |  | FairValue |  | Balance Sheet Location |  | FairValue |  | Balance Sheet Location |  | FairValue |
| Derivatives designated as hedging instruments:     |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |
| Interest rate contracts                            | Other Assets |  | $ | 197 |  |  | Other Assets |  | $ | 424 |  |  | Other Liabilities |  | $ | 3,332 |  |  | Other Liabilities |  | $ | 2,305 |  |
| Derivatives not designated as hedging instruments: |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |
| Interest rate contracts                            | Other Assets |  | $ | 6,103 |  |  | Other Assets |  | $ | 5,241 |  |  | Other Liabilities |  | $ | 6,434 |  |  | Other Liabilities |  | $ | 5,492 |  |

----

Table of Contents

|                                                                      |
|----------------------------------------------------------------------|
|                                                                      |  |  |  |  |
| Derivatives NotDesignated as HedgingInstruments underFASB ASC 815-10 | Location of Gain(Loss) Recognized inIncome on Derivative | Amount of Gain (Loss)Recognized in Income onDerivative for the Year Ended December 31, 2012 |  | Amount of Gain (Loss)Recognized in Income onDerivative for the Year Ended December 31, 2011 |
| Interest Rate Contracts                                              | Other income | $(79) |  | $(94) |

|                                                |
|------------------------------------------------|
|                                                |  |  |  |  |  |  |  |
| Derivatives in Cash Flow Hedging Relationships | Amount of Loss Recognized in Other Comprehensive Income on Derivative (Effective Portion) For the Year Ended |   | Location of Loss Reclassified from Accumulated Other Comprehensive Income (Effective Portion) |   | Amount of Loss Reclassified from Other Comprehensive Income into Income (Effective Portion)For the Year Ended |
| 2012                                           | 2011 |   |   | 2012 | 2011 |
| Interest Rate Products                         | $(1,466) | $(3,274) |   | Interest Expense |   | $(217) |  |

----

Table of Contents

----

Table of Contents

|                                                      |
|------------------------------------------------------|
|                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                 |   |   | Fair Value Measurements Using: |
|                                                 |   |   | Quoted Prices in ActiveMarkets for Identical Assets |   | Significant Other Observable Inputs |   | SignificantUnobservable Inputs |
| December 31, 2012                               | Fair Value |   | (Level 1) |   | (Level 2) |   | (Level 3) |
| U.S. Government-sponsored agency securities          | $ | 4,640 |  |  |  |  | $ | 4,640 |  |  |  |
| State and municipal                                  | 158,194 |  |  |  |  | 140,094 |  |  | $ | 18,100 |  |
| U.S. Government-sponsored mortgage-backed securities | 348,579 |  |  |  |  | 348,579 |  |  |  |
| Corporate obligations                                | 224 |  |  |  |  |  |  | 224 |  |
| Equity securities                                    | 1,706 |  |  |  |  | 1,702 |  |  | 4 |  |
| Interest rate swap asset                             | 6,103 |  |  |  |  | 6,103 |  |  |  |
| Interest rate cap                                    | 197 |  |  |  |  | 197 |  |  |  |
| Interest rate swap liability                         | 9,766 |  |  |  |  | 9,766 |  |  |  |

|                                                      |
|------------------------------------------------------|
|                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                 |   |   | Fair Value Measurements Using: |
|                                                 |   |   | Quoted Prices in ActiveMarkets for Identical Assets |   | Significant Other Observable Inputs |   | SignificantUnobservable Inputs |
| December 31, 2011                               | Fair Value |   | (Level 1) |   | (Level 2) |   | (Level 3) |
| U.S. Government-sponsored agency securities          | $ | 117 |  |  |   |  | $ | 117 |  |  |   |
| State and municipal                                  | 147,353 |  |  |   |  | 126,712 |  |  | $ | 20,641 |  |
| U.S. Government-sponsored mortgage-backed securities | 368,998 |  |  |   |  | 368,998 |  |  |   |
| Corporate obligations                                | 193 |  |  |   |  |   |  | 193 |  |
| Equity securities                                    | 1,830 |  |  |   |  | 1,826 |  |  | 4 |  |
| Interest rate swap asset                             | 5,241 |  |  |   |  |   |  | 5,241 |  |
| Interest rate cap                                    | 424 |  |  |   |  |   |  | 424 |  |
| Interest rate swap liability                         | 7,797 |  |  |   |  |   |  | 7,797 |  |

----

Table of Contents

|                                                |
|------------------------------------------------|
|                                                |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                           | Year Ended December 31, 2012 |
|                                           | Available forSale Securities |   | Interest RateSwap Asset |   | Interest Rate Cap |   | Interest RateSwap Liability |
| Beginning Balance                              | $ | 20,838 |  |  | $ | 5,241 |  |  | $ | 424 |  |  | $ | 7,797 |  |
| Total realized and unrealized gains and losses |  |  |  |  |  |  |  |
| Included in net income                         |  |  |  | (860 | ) |  |  |  | (863 | ) |
| Included in other comprehensive income         | (1,141 | ) |  | 481 |  |  | (15 | ) |  |  |
| Purchases, issuances, and settlements          |  |  |  |  |  |  |  |
| Transfers in/(out) of Level 3                  |  |  |  | (4,862 | ) |  | (409 | ) |  | (6,934 | ) |
| Principal payments                             | (1,369 | ) |  |  |  |  |  |  |
| Ending balance                                 | $ | 18,328 |  |  |  |  |  |  |  |  |  |  |

|                                                |
|------------------------------------------------|
|                                                |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                           | Year Ended December 31, 2011 |
|                                           | Available forSale Securities |   | Interest RateSwap Asset |   | InterestRate Cap |   | Interest RateSwap Liability |
| Beginning Balance                              | $ | 186 |  |   | $ | 4,002 |  |   | $ | 1,109 |  |   | $ | 3,876 |  |
| Total realized and unrealized gains and losses |   |   |   |   |   |   |   |
| Included in net income                         | (400 | ) |   | 3,827 |  |   |   |   | 3,921 |  |
| Included in other comprehensive income         | 2,029 |  |   | (2,588 | ) |   | (685 | ) |   |   |
| Purchases, issuances, and settlements          |   |   |   |   |   |   |   |
| Transfers in/(out) of Level 3                  | 18,711 |  |   |   |   |   |   |   |
| Principal payments                             | 312 |  |   |   |   |   |   |   |
| Ending balance                                 | $ | 20,838 |  |   | $ | 5,241 |  |   | $ | 424 |  |   | $ | 7,797 |  |

|                                  |
|----------------------------------|
|                                  |  |  |  |  |  |  |  |  |  |  |  |
|                             | Quoted Prices in ActiveMarkets for Identical Assets |  | Significant Other Observable Inputs |  | SignificantUnobservable Inputs |  |  |
|                                  | (Level 1) |  | (Level 2) |  | (Level 3) |  | Reason for Transfer |
|  Transfers to/(from) Level: |  |  |  |  |  |  | The interest rate swap and cap instruments were transferred from Level 3 to Level 2 as of March 31, 2012 due to the availability of additional valuation information.  These instruments are valued using widely accepted valuation techniques including discounted cash flow analysis using observable inputs such as contractual terms and LIBOR-based rate curves. |
| Interest rate swap asset         |  |  | $ | 4,862 |  |  | $ | (4,862 | ) |  |
| Interest rate cap                |  |  | 409 |  |  | (409 | ) |  |
| Interest rate swap liability     |  |  | 6,934 |  |  | (6,934 | ) |  |

----

Table of Contents

|                                       |
|---------------------------------------|
|                                       |  |  |  |  |  |  |  |  |  |  |  |  |
|                                  |  |   |  | Fair Value Measurements Using |
|                                  |  |   |  | Quoted Prices in ActiveMarkets for Identical Assets |  | Significant Other Observable Inputs |  | SignificantUnobservable Inputs |
| December 31, 2012                |  | Fair Value |  | (Level 1) |  | (Level 2) |  | (Level 3) |
| Impaired Loans (collateral dependent) |  | $ | 17,703 |  |  |   |  |   |  | $ | 17,703 |  |
| Other real estate owned               |  | $ | 7,684 |  |  |   |  |   |  | $ | 7,684 |  |

|                                       |
|---------------------------------------|
|                                       |  |  |  |  |  |  |  |  |  |  |  |  |
|                                  |  |   |  | Fair Value Measurements Using |
|                                  |  |   |  | Quoted Prices in ActiveMarkets for Identical Assets |  | Significant Other Observable Inputs |  | SignificantUnobservable Inputs |
| December 31, 2011                |  | Fair Value |  | (Level 1) |  | (Level 2) |  | (Level 3) |
| Impaired Loans (collateral dependent) |  | $ | 22,885 |  |  |   |  |   |  | $ | 22,885 |  |
| Other real estate owned               |  | $ | 7,882 |  |  |   |  |   |  | $ | 7,882 |  |

----

Table of Contents

|                                         |
|-----------------------------------------|
|                                         |  |  |  |  |  |  |  |  |  |
|                                         | Fair Value |  | Valuation Technique |  | Unobservable Inputs |  | Range |
| State and municipal securities          | $ | 18,100 |  |  | Discounted cash flow |  | Maturity Call DateBlend of US Muni BQ curveDiscount rate |  | 1 month to 11 yearsA- to BBB-1% - 4% |
|                                         |  |  |  |  |  |  |  |
| Corporate obligations/Equity securities | $ | 228 |  |  | Discounted cash flow |  | Risk free rateplus Premium for illiquidity |  | 3 month LIBORplus 200 bps |
|                                         |  |  |  |  |  |  |  |
| Impaired loans (collateral dependent)   | $ | 17,703 |  |  | Collateral based measurements |  | Discount to reflect current market conditions and ultimate collectability |  | 0% - 50% |
|                                         |  |  |  |  |  |  |  |
| Other real estate owned                 | $ | 7,684 |  |  | Appraisals |  | Discount to reflect current market conditions |  | 0% - 20% |

----

Table of Contents

|                                             |
|---------------------------------------------|
|                                             |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                        | 2012 |
|                                        | CarryingAmount |  | Quoted Prices in Active Markets for Identical Assets (Level 1) |  | Significant Other Observable Inputs(Level 2) |  | Significant Unobservable Inputs(Level 3) |
| Assets at December 31:                      |   |  |  |  |   |  |   |
| Cash and cash equivalents                   | $ | 101,460 |  |  | $ | 101,460 |  |  |  |  |  |  |  |
| Interest-bearing time deposits              | 38,443 |  |  | 38,443 |  |  |  |  |  |  |  |
| Investment securities available for sale    | 513,343 |  |  |  |  |  | $ | 495,015 |  |  | $ | 18,328 |  |
| Investment securities held to maturity      | 361,020 |  |  |  |  |  | 366,590 |  |  | 11,584 |  |
| Mortgage loans held for sale                | 22,300 |  |  |  |  |  | 22,300 |  |  |  |  |
| Loans                                       | 2,832,843 |  |  |  |  |  |  |  |  | 2,852,614 |  |
| FRB and FHLB stock                          | 32,785 |  |  |  |  |  | 32,785 |  |  |  |  |
| Interest rate swap asset                    | 6,300 |  |  |  |  |  | 6,300 |  |  |  |  |
| Interest receivable                         | 16,367 |  |  |  |  |  | 16,367 |  |  |  |  |
| Liabilities at December 31:                 |  |  |  |  |  |  |  |
| Deposits                                    | $ | 3,346,383 |  |  | $ | 2,478,706 |  |  | $ | 865,793 |  |  |  |  |
| Borrowings:                                 |  |  |  |  |  |  |  |
| Federal funds purchased                     | 18,862 |  |  |  |  |  | 18,862 |  |  |  |  |
| Securities sold under repurchase agreements | 141,828 |  |  |  |  |  | 142,318 |  |  |  |  |
| FHLB Advances                               | 94,238 |  |  |  |  |  | 97,357 |  |  |  |  |
| Subordinated debentures and term loans      | 112,161 |  |  |  |  |  | 62,133 |  |  |  |  |
| Interest rate swap liability                | 9,766 |  |  |  |  |  | 9,766 |  |  |  |  |
| Interest payable                            | 1,841 |  |  |  |  |  | 1,841 |  |  |  |  |

|                                             |
|---------------------------------------------|
|                                             |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                        | 2011 |
|                                        | CarryingAmount |  | Quoted Prices in Active Markets for Identical Assets (Level 1) |  | Significant Other Observable Inputs(Level 2) |  | Significant Unobservable Inputs(Level 3) |
| Assets at December 31:                      |   |  |  |  |   |  |   |
| Cash and cash equivalents                   | $ | 73,312 |  |  | $ | 73,312 |  |  |  |  |  |  |  |
| Interest-bearing time deposits              | 52,851 |  |  | 52,851 |  |  |  |  |  |  |  |
| Investment securities available for sale    | 518,491 |  |  |  |  |  | $ | 497,653 |  |  | $ | 20,838 |  |
| Investment securities held to maturity      | 427,909 |  |  |  |  |  | 428,737 |  |  | 13,732 |  |
| Mortgage loans held for sale                | 17,864 |  |  |  |  |  | 17,864 |  |  |  |  |
| Loans                                       | 2,642,517 |  |  |  |  |  |  |  |  | 2,658,227 |  |
| FRB and FHLB stock                          | 31,270 |  |  |  |  |  | 31,270 |  |  |  |  |
| Interest rate swap asset                    | 5,665 |  |  |  |  |  |  |  |  | 5,665 |  |
| Interest receivable                         | 17,723 |  |  |  |  |  | 17,723 |  |  |  |  |
| Liabilities at December 31:                 |  |  |  |  |  |  |  |
| Deposits                                    | $ | 3,134,655 |  |  | $ | 2,195,679 |  |  | $ | 944,078 |  |  |  |  |
| Borrowings:                                 |  |  |  |  |  |  |  |
| Securities sold under repurchase agreements | 156,305 |  |  |  |  |  | 157,342 |  |  |  |  |
| FHLB Advances                               | 138,095 |  |  |  |  |  | 141,693 |  |  |  |  |
| Subordinated debentures and term loans      | 194,974 |  |  |  |  |  | 142,632 |  |  |  |  |
| Interest rate swap liability                | 7,797 |  |  |  |  |  |  |  |  | 7,797 |  |
| Interest payable                            | 2,925 |  |  |  |  |  | 2,925 |  |  |  |  |

----

Table of Contents

|                                   |
|-----------------------------------|
|                                   |  |  |  |  |  |  |  |
|                              | 2012 |  | 2011 |
| Amounts of commitments:           |   |  |   |
| Loan commitments to extend credit | $ | 873,455 |  |  | $ | 619,901 |  |
| Standby letters of credit         | $ | 21,734 |  |  | $ | 28,665 |  |

----

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----

Table of Contents

|                                          |
|------------------------------------------|
|                                          |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                     | 2012 |  | 2011 |
|                                     |   |  |   |  | Required For |  |   |  |   |  | Required For |
|                                     | Actual |  | Adequate Capital |  | Actual |  | Adequate Capital |
| December 31,                             | Amount |  | Ratio |  | Amount |  | Ratio |  | Amount |  | Ratio |  | Amount |  | Ratio |
| Total Capital (to Risk-weighted Assets)  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |
| First Merchants Corporation              | $ | 526,792 |  |  | 16.34 | % |  | $ | 257,927 |  |  | 8.00 | % |  | $ | 487,393 |  |  | 16.54 | % |  | $ | 235,781 |  |  | 8.00 | % |
| First Merchants Bank                     | 515,337 |  |  | 16.01 |  |  | 257,446 |  |  | 8.00 |  |  | 477,805 |  |  | 16.26 |  |  | 235,089 |  |  | 8.00 |  |
| Tier I Capital (to Risk-weighted Assets) |  |  |  |  |  |  |   |  |   |  |   |  |   |  |   |
| First Merchants Corporation              | $ | 456,132 |  |  | 14.15 | % |  | $ | 128,964 |  |  | 4.00 | % |  | $ | 410,132 |  |  | 13.92 | % |  | $ | 117,890 |  |  | 4.00 | % |
| First Merchants Bank                     | 474,782 |  |  | 14.75 |  |  | 128,723 |  |  | 4.00 |  |  | 440,909 |  |  | 15.00 |  |  | 117,545 |  |  | 4.00 |  |
| Tier I Capital (to Average Assets)       |  |  |  |  |  |  |   |  |   |  |   |  |   |  |   |
| First Merchants Corporation              | $ | 456,132 |  |  | 11.03 | % |  | $ | 165,460 |  |  | 4.00 | % |  | $ | 410,132 |  |  | 10.17 | % |  | $ | 161,350 |  |  | 4.00 | % |
| First Merchants Bank                     | 474,782 |  |  | 11.50 |  |  | 165,124 |  |  | 4.00 |  |  | 440,909 |  |  | 10.96 |  |  | 160,848 |  |  | 4.00 |  |

----

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----

Table of Contents

|                                                |
|------------------------------------------------|
|                                                |  |  |  |  |  |  |  |  |  |
|                                           | 2012 |   | 2011 |   | 2010 |   |
| Risk-free interest rate                        | 1.36 | % |   | 2.74 | % |   | 2.38 | % |   |
| Expected price volatility                      | 46.22 | % |   | 45.43 | % |   | 43.54 | % |   |
| Dividend yield                                 | 3.29 | % |   | 3.65 | % |   | 4.02 | % |   |
| Forfeiture rate                                | 4.77 | % |   | 5.00 | % |   | 5.00 | % |   |
| Weighted-average expected life, until exercise | 7.20 |  | years | 6.91 |  | years | 6.68 |  | years |

|                                                             |
|-------------------------------------------------------------|
|                                                             |  |  |  |  |  |  |  |  |  |  |  |
|                                                             | Year EndedDecember 31, |   | Year EndedDecember 31, |   | Year EndedDecember 31, |
|                                                        | 2012 |   | 2011 |   | 2010 |
| Stock and ESPP Options                                      |   |  |   |  |   |
| Pre-tax compensation expense                                | $ | 284 |  |  | $ | 237 |  |  | $ | 632 |  |
| Income tax benefit                                          | (23 | ) |  | (21 | ) |  | (71 | ) |
| Stock and ESPP option expense, net of income taxes          | $ | 261 |  |  | $ | 216 |  |  | $ | 561 |  |
| Restricted Stock Awards                                     |   |  |   |  |   |
| Pre-tax compensation expense                                | $ | 1,208 |  |  | $ | 1,078 |  |  | $ | 1,118 |  |
| Income tax benefit                                          | (428 | ) |  | (371 | ) |  | (391 | ) |
| Restricted stock awards expense, net of income taxes        | $ | 780 |  |  | $ | 707 |  |  | $ | 727 |  |
| Total Share-Based Compensation:                             |   |  |   |  |   |
| Pre-tax compensation expense                                | $ | 1,492 |  |  | $ | 1,315 |  |  | $ | 1,750 |  |
| Income tax benefit                                          | (451 | ) |  | (392 | ) |  | (462 | ) |
| Total share-based compensation expense, net of income taxes | $ | 1,041 |  |  | $ | 923 |  |  | $ | 1,288 |  |

|                                                  |
|--------------------------------------------------|
|                                                  |  |  |  |  |  |  |  |  |  |  |  |
|                                             | Number ofShares |  | Weighted-AverageExercise Price |  | Weighted AverageRemaining ContractualTerm (in Years) |  | AggregateIntrinsic Value |
| Outstanding at January 1, 2012                   | 1,035,871 |  |  | $ | 22.57 |  |  |   |  |   |
| Granted                                          | 46,801 |  |  | $ | 11.69 |  |  |   |  |   |
| Exercised                                        | (10,500 | ) |  | $ | 7.39 |  |  |  |  |  |
| Cancelled                                        | (165,536 | ) |  | $ | 25.87 |  |  |   |  |   |
| Outstanding December 31, 2012                    | 906,636 |  |  | $ | 21.58 |  |  | 4.08 |  | 1,046,301 |  |
| Vested and Expected to Vest at December 31, 2012 | 906,636 |  |  | $ | 21.58 |  |  | 4.08 |  | 1,046,301 |  |
| Exercisable at December 31, 2012                 | 838,586 |  |  | $ | 22.61 |  |  | 3.63 |  | 721,758 |  |

----

Table of Contents

|                                    |
|------------------------------------|
|                                    |  |  |  |  |  |  |
|                               | Number ofShares |  | Weighted-AverageGrant Date Fair Value |
| Unvested RSAs at January 1, 2012   | 338,087 |  |  | $ | 8.65 |  |
| Granted                            | 160,089 |  |  | $ | 11.86 |  |
| Forfeited                          | (86,326 | ) |  | $ | 11.41 |  |
| Vested                             | (10,475 | ) |  | $ | 9.36 |  |
| Unvested RSAs at December 31, 2012 | 401,375 |  |  | $ | 9.29 |  |

|                                                                                                                                        |
|----------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                        |  |  |  |  |  |  |  |
|                                                                                                                                   | 2012 |   | 2011 |
| Change in benefit obligation                                                                                                           |   |   |   |
| Benefit obligation at beginning of year                                                                                                | $ | 68,769 |  |   | $ | 61,422 |  |
| Service Cost                                                                                                                           | 161 |  |   | 252 |  |
| Interest Cost                                                                                                                          | 2,990 |  |   | 3,208 |  |
| Actuarial Loss (Gain)                                                                                                                  | 3,168 |  |   | 7,346 |  |
| Benefits paid                                                                                                                          | (5,922 | ) |   | (3,459 | ) |
| Benefit obligation at end of year                                                                                                      | 69,166 |  |   | 68,769 |  |
| Change in plan assets                                                                                                                  |   |   |   |
| Fair value of plan assets at beginning of year                                                                                         | 62,078 |  |   | 63,275 |  |
| Actual return on plan assets                                                                                                           | 6,141 |  |   | 1,726 |  |
| Employer contributions                                                                                                                 | 568 |  |   | 536 |  |
| Benefits Paid                                                                                                                          | (5,922 | ) |   | (3,459 | ) |
| End of Year                                                                                                                            | 62,865 |  |   | 62,078 |  |
| Funded Status at End of Year                                                                                                           | $ | (6,301 | ) |   | $ | (6,691 | ) |
| Assets and Liabilities Recognized in the Balance Sheets:                                                                               |   |   |   |
| Deferred Tax Asset                                                                                                                     | $ | 9,200 |  |   | $ | 10,928 |  |
| Liabilities                                                                                                                            | $ | 6,301 |  |   | $ | 6,691 |  |
| Amounts Recognized in Accumulated Other Comprehensive Income Not Yet Recognized as Components of Net Periodic Benefit Cost Consist of: |   |   |   |
| Accumulated Loss                                                                                                                       | $ | (17,085 | ) |   | $ | (16,310 | ) |
| Prior Service Credit                                                                                                                   | (41 | ) |   | (56 | ) |
|                                                                                                                                   | $ | (17,126 | ) |   | $ | (16,366 | ) |

----

Table of Contents

|                                |
|--------------------------------|
|                                |  |  |  |  |  |  |  |
|                           | December 31, 2012 |   | December 31, 2011 |
| Projected Benefit Obligation   | $ | 69,166 |  |   | $ | 68,769 |  |
| Accumulated Benefit Obligation | $ | 69,139 |  |   | $ | 68,729 |  |
| Fair Value of Plan Assets      | $ | 62,865 |  |   | $ | 62,078 |  |

|                                     |
|-------------------------------------|
|                                     |  |  |  |  |  |  |  |
|                                | December 31, 2012 |   | December 31, 2011 |
| Service Cost                        | $ | 161 |  |   | $ | 252 |  |
| Interest Cost                       | 2,990 |  |   | 3,208 |  |
| Expected Return on Plan Assets      | (4,216 | ) |   | (4,313 | ) |
| Amortization of Prior Service Costs | 25 |  |   | 25 |  |
| Amortization of Net Loss            | 2,207 |  |   | 1,129 |  |
| Net Periodic Pension Cost           | $ | 1,167 |  |   | $ | 301 |  |

|                                                |
|------------------------------------------------|
|                                                |  |  |  |  |  |  |  |
|                                           | December 31, 2012 |   | December 31, 2011 |
| Net Periodic Pension Cost                      | $ | 1,167 |  |   | $ | 301 |  |
| Net gain (loss)                                | 1,242 |  |   | 9,933 |  |
| Actuarial gain (loss)                          | (2,207 | ) |   | (1,129 | ) |
| Amortization of prior service (cost) credit    | (25 | ) |   | (25 | ) |
| Total Recognized in Other Comprehensive Income | (990 | ) |   | 8,779 |  |
| Total Recognized in NPPC and OCI               | $ | 177 |  |   | $ | 9,080 |  |

|                                    |
|------------------------------------|
|                                    |  |  |  |  |  |  |  |
|                                    | December 31, 2012 |  | December 31, 2011 |
| Amortization of Net Loss           | $ | (2,158 | ) |  | $ | (2,319 | ) |
| Amortization of Prior Service Cost | (25 | ) |  | (25 | ) |
| Total                              | $ | (2,183 | ) |  | $ | (2,344 | ) |

|                                                                    |
|--------------------------------------------------------------------|
|                                                                    |  |  |  |  |  |
|                                                               | December 31, 2012 |   | December 31, 2011 |
| Weighted-average Assumptions Used to Determine Benefit Obligation: |   |   |   |
| Discount Rate                                                      | 4.00 | % |   | 4.50 | % |
| Rate of Compensation Increase for accruing active participants     | 3.00 | % |   | 4.00 | % |
| Weighted-average Assumptions Used to Determine Benefit Cost:       |   |   |   |
| Discount Rate                                                      | 4.50 | % |   | 5.40 | % |
| Expected Return on Plan Assets                                     | 7.00 | % |   | 7.00 | % |
| Rate of Compensation Increase for accruing active participants     | 4.00 | % |   | 4.00 | % |

----

Table of Contents

|            |
|------------|
|            |  |  |  |
| 2013       | $ | 3,984 |  |
| 2014       | 4,110 |  |
| 2015       | 4,236 |  |
| 2016       | 4,219 |  |
| 2017       | 4,201 |  |
| After 2017 | 21,414 |  |
|       | $ | 42,164 |  |

|                           |
|---------------------------|
|                           |  |  |  |  |  |  |  |  |  |  |  |
|                      | December 31, 2012 |  | December 31, 2011 |
|                      | Actual |  | Target |  | Actual |  | Target |
| Cash and cash equivalents | 1.3 | % |  | 3.0 | % |  | 3.2 | % |  | 3.0 | % |
| Equity securities         | 53.7 |  |  | 51.0 |  |  | 49.7 |  |  | 51.0 |  |
| Debt securities           | 43.0 |  |  | 44.0 |  |  | 45.5 |  |  | 44.0 |  |
| Alternative investments   | 2.0 |  |  | 2.0 |  |  | 1.6 |  |  | 2.0 |  |
|                      | 100.0 | % |  | 100.0 | % |  | 100.0 | % |  | 100.0 | % |

----

Table of Contents

|                                                 |
|-------------------------------------------------|
|                                                 |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                            |   |  | Fair Value Measurements Using |
|                                            |   |   | Quoted Prices inActive Markets forIdentical Assets |   | Significant Other Observable Inputs |   | SignificantUnobservableInputs |
| December 31, 2012                          | Fair Value |  | (Level 1) |  | (Level 2) |  | (Level 3) |
| Cash & Cash Equivalents                     | $ | 795 |  |  | $ | 795 |  |  |  |  |  |
| Corporate Bonds and Notes                       | 6,157 |  |  | 6,157 |  |  |  |  |  |
| Government Agency and Municipal Bonds and Notes | 8,642 |  |  |  |  | $ | 8,642 |  |  |  |
| Certificates of Deposit                         | 357 |  |  |  |  | 357 |  |  |  |
| Preferred Stock                                 | 52 |  |  | 52 |  |  |  |  |  |
| Party-in-Interest Investments                   |   |  |   |  |   |  |  |
| Common Stock                                    | 898 |  |  | 898 |  |  |  |  |  |
| Common Bond Fund                                | 4,075 |  |  |  |  | 4,075 |  |  |  |
| Common Equity Fund                              | 4,495 |  |  |  |  | 4,495 |  |  |  |
| Mutual Funds                                    |  |  |  |  |  |  |  |
| Taxable Bond                                    | 7,409 |  |  | 7,409 |  |  |  |  |  |  |
| Large Cap Equity                                | 16,166 |  |  | 16,166 |  |  |  |  |  |
| Mid Cap Equity                                  | 6,772 |  |  | 6,772 |  |  |  |  |  |
| Small Cap Equity                                | 2,640 |  |  | 2,640 |  |  |  |  |  |
| International Equity                            | 3,178 |  |  | 3,178 |  |  |  |  |  |
| Specialty Alternative Equity                    | 1,229 |  |  | 1,229 |  |  |  |  |  |

|                                                                      |
|----------------------------------------------------------------------|
|                                                                      |  |  |  |  |  |  |  |  |  |  |  |
|                                                                 | 2012 |  | 2011 |  | 2010 |
| Income Tax Expense (Benefit) for the Year Ended December 31:         |  |  |   |  |   |
| Currently Payable:                                                   |  |  |   |  |   |
| Federal                                                              | $ | (23 | ) |  | $ | 399 |  |  | $ | (1,780 | ) |
| State                                                                |  |  |   |  |   |  |
| Deferred:                                                            |  |  |   |  |   |
| Federal                                                              | 15,890 |  |  | 8,256 |  |  | (1,810 | ) |
| State                                                                |  |  |   |  |   |  |
| Total Income Tax Expense (Benefit)                                   | $ | 15,867 |  |  | $ | 8,655 |  |  | $ | (3,590 | ) |
| Reconciliation of Federal Statutory to Actual Tax Expense (Benefit): |   |  |   |  |   |
| Federal Statutory Income Tax at 35%                                  | $ | 21,347 |  |  | $ | 11,867 |  |  | $ | 1,162 |  |
| Tax-exempt Interest Income                                           | (3,716 | ) |  | (3,714 | ) |  | (3,733 | ) |
| Non-deductible Interest Expense                                      |  |  |  | 649 |  |  | 421 |
| Stock Compensation                                                   | 76 |  |  | 69 |  |  | 150 |  |
| Earnings on Life Insurance                                           | (1,187 | ) |  | (899 | ) |  | (725 | ) |
| Tax Credits                                                          | (73 | ) |  | (99 | ) |  | (116 | ) |
| Other                                                                | (580 | ) |  | 782 |  |  | (749 | ) |
| Actual Tax Expense (Benefit)                                         | $ | 15,867 |  |  | $ | 8,655 |  |  | $ | (3,590 | ) |

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|                                                                   |
|-------------------------------------------------------------------|
|                                                                   |  |  |  |  |  |  |  |
|                                                              | 2012 |  | 2011 |
| Deferred Tax Asset at December 31:                                |   |  |   |
| Assets:                                                           |   |  |   |
| Differences in Accounting for Loan Losses                         | $ | 28,788 |  |  | $ | 29,690 |  |
| Differences in Accounting for Loan Fees                           | 941 |  |  | 805 |  |
| Differences in Accounting for Loans and Securities                | 477 |  |  |   |
| Deferred Compensation                                             | 7,181 |  |  | 7,612 |  |
| Difference in Accounting for Pensions and Other Employee Benefits | 1,953 |  |  | 3,750 |  |
| Federal & State Income Tax Loss Carryforward and Credits      | 9,356 |  |  | 12,416 |  |
| Other                                                             | 9,356 |  |  | 8,796 |  |
| Total Assets                                                      | 58,052 |  |  | 63,069 |  |
| Liabilities:                                                      |   |  |   |
| Differences in Depreciation Methods                               | 6,050 |  |  | 5,859 |  |
| Differences in Accounting for Loans and Securities                |  |  |  | 42 |  |
| State Income Tax                                                  | 354 |  |  | 354 |  |
| Net Unrealized Gain on Securities Available for Sale              | 7,879 |  |  | 8,118 |  |
| Gain on FDIC Modified Whole Bank Transaction                      | 2,737 |  |  |  |  |
| Other                                                             | 1,051 |  |  | 1,137 |  |
| Total Liabilities                                                 | 18,071 |  |  | 15,510 |  |
| Net Deferred Tax Asset Before Valuation Allowance                 | 39,981 |  |  | 47,559 |  |
| Valuation allowance:                                              |  |  |   |
| Beginning Balance                                                 | (15,701 | ) |  | (13,258 | ) |
| Decrease/(Increase) During the Year                               | 1,842 |  |  | (2,443 | ) |
| Ending Balance                                                    | (13,859 | ) |  | (15,701 | ) |
| Net Deferred Tax Asset                                            | $ | 26,122 |  |  | $ | 31,858 |  |

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|                                                                    |
|--------------------------------------------------------------------|
|                                                                    |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                               | 2012 |  | 2011 |  | 2010 |
|                                                               | NetIncome |  | Weighted-Average Shares |  | PerShare Amount |  | NetIncome |  | Weighted-Average Shares |  | PerShare Amount |  | NetIncome (Loss) |  | Weighted-Average Shares |  | PerShare Amount |
| Basic net income per share:                                        | $ | 45,122 |  |  |  |  |   |  | $ | 25,252 |  |  |   |  |   |  | $ | 6,909 |  |  |   |  |   |
| Gain on exchange of preferred stock for trust preferred securities |  |  |   |  |   |  |   |  |  |   |  |   |  | 11,353 |  |  |   |  |   |
| Loss on CPP unamortized discount                                   |  |  |  |   |  |   |  | (1,401 | ) |  |   |  |   |  | (1,301 | ) |  |   |  |   |
| Loss on extinguishment of trust preferred securities               |  |  |  |   |  |   |  | (10,857 | ) |  |   |  |   |  |   |  |   |  |   |
| Preferred stock dividends                                          | (4,539 | ) |  |   |  |   |  | (3,981 | ) |  |   |  |   |  | (5,239 | ) |  |   |  |   |
| Net income available to common stockholders                        | 40,583 |  |  | 28,632,915 |  |  | $ | 1.42 |  |  | 9,013 |  |  | 26,550,043 |  |  | $ | 0.34 |  |  | 11,722 |  |  | 24,519,033 |  |  | $ | 0.48 |  |
| Effect of dilutive stock options and warrants                      |   |  | 213,769 |  |  |   |  |   |  | 143,805 |  |  |   |  |   |  | 123,392 |  |  |   |
| Diluted net income per share:                                      |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |
| Net income available to common stockholders                        | $ | 40,583 |  |  | 28,846,684 |  |  | $ | 1.41 |  |  | $ | 9,013 |  |  | 26,693,848 |  |  | $ | 0.34 |  |  | $ | 11,722 |  |  | 24,642,425 |  |  | $ | 0.48 |  |

|                                                      |
|------------------------------------------------------|
|                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                      | 2012 |  | 2011 |
|                                                      | First |  | Second |  | Third |  | Fourth |  | First |  | Second |  | Third |  | Fourth |
| Interest income                                      | $ | 43,469 |  |  | $ | 44,169 |  |  | $ | 45,347 |  |  | $ | 42,964 |  |  | $ | 46,366 |  |  | $ | 45,721 |  |  | $ | 45,085 |  |  | $ | 44,073 |  |
| Interest expense                                     | 7,353 |  |  | 6,116 |  |  | 5,445 |  |  | 4,699 |  |  | 10,889 |  |  | 9,874 |  |  | 9,234 |  |  | 7,893 |  |
| Net interest income                                  | 36,116 |  |  | 38,053 |  |  | 39,902 |  |  | 38,265 |  |  | 35,477 |  |  | 35,847 |  |  | 35,851 |  |  | 36,180 |  |
| Provision for loan losses                            | 4,875 |  |  | 4,545 |  |  | 4,609 |  |  | 4,505 |  |  | 5,594 |  |  | 5,625 |  |  | 5,556 |  |  | 5,855 |  |
| Net interest income after provision for loan losses  | 31,241 |  |  | 33,508 |  |  | 35,293 |  |  | 33,760 |  |  | 29,883 |  |  | 30,222 |  |  | 30,295 |  |  | 30,325 |  |
| Non-interest income                                  | 22,658 |  |  | 13,165 |  |  | 14,273 |  |  | 14,206 |  |  | 11,858 |  |  | 11,061 |  |  | 13,230 |  |  | 12,971 |  |
| Non-interest expense                                 | 34,028 |  |  | 34,180 |  |  | 34,404 |  |  | 34,503 |  |  | 33,881 |  |  | 34,399 |  |  | 34,222 |  |  | 33,436 |  |
| Income before income tax expense                     | 19,871 |  |  | 12,493 |  |  | 15,162 |  |  | 13,463 |  |  | 7,860 |  |  | 6,884 |  |  | 9,303 |  |  | 9,860 |  |
| Income tax expense                                   | 5,500 |  |  | 3,288 |  |  | 3,926 |  |  | 3,153 |  |  | 2,399 |  |  | 1,396 |  |  | 2,561 |  |  | 2,299 |  |
| Net income                                           | 14,371 |  |  | 9,205 |  |  | 11,236 |  |  | 10,310 |  |  | 5,461 |  |  | 5,488 |  |  | 6,742 |  |  | 7,561 |  |
| Loss on CPP unamortized discount                     |  |  |  |  |  |  |  |  |  |  |  |  | (1,401 | ) |  |  |
| Loss on extinguishment of trust preferred securities |  |  |  |  |  |  |  |  |  |  |  |  | (10,857 | ) |  |  |
| Preferred stock dividends                            | (1,135 | ) |  | (1,135 | ) |  | (1,134 | ) |  | (1,135 | ) |  | (988 | ) |  | (990 | ) |  | (868 | ) |  | (1,135 | ) |
| Net income available to common stockholders          | $ | 13,236 |  |  | $ | 8,070 |  |  | $ | 10,102 |  |  | $ | 9,175 |  |  | $ | 4,473 |  |  | $ | 4,498 |  |  | $ | (6,384 | ) |  | $ | 6,426 |  |
|                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Basic EPS                                            | $ | 0.46 |  |  | $ | 0.29 |  |  | $ | 0.35 |  |  | $ | 0.32 |  |   | $ | 0.17 |  |  | $ | 0.18 |  |  | $ | (0.25 | ) |  | $ | 0.24 |  |
| Diluted EPS                                          | $ | 0.46 |  |  | $ | 0.28 |  |  | $ | 0.35 |  |  | $ | 0.32 |  |   | $ | 0.17 |  |  | $ | 0.18 |  |  | $ | (0.25 | ) |  | $ | 0.24 |  |
| Average Shares Outstanding:                          |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Basic                                                | 28,582,616 |  |  | 28,624,609 |  |  | 28,649,996 |  |  | 28,673,802 |  |  | 25,605,571 |  |  | 25,656,826 |  |  | 26,367,067 |  |  | 28,540,469 |  |
| Diluted                                              | 28,754,713 |  |  | 28,815,019 |  |  | 28,888,076 |  |  | 28,930,392 |  |  | 25,763,378 |  |  | 25,782,799 |  |  | 26,367,067 |  |  | 28,699,505 |  |

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|                                            |
|--------------------------------------------|
|                                            |  |  |  |  |  |  |  |
|                                       | December 31, 2012 |   | December 31, 2011 |
| Assets                                     |   |   |   |
| Cash                                       | $ | 35,160 |  |   | $ | 20,654 |  |
| Investment in Subsidiaries                 | 633,971 |  |   | 611,809 |  |
| Goodwill                                   | 448 |  |   | 448 |  |
| Other Assets                               | 6,638 |  |   | 8,540 |  |
| Total Assets                               | $ | 676,217 |  |   | $ | 641,451 |  |
| Liabilities                                |   |   |   |
| Borrowings                                 | $ | 111,702 |  |   | $ | 115,826 |  |
| Other Liabilities                          | 12,279 |  |   | 11,158 |  |
| Total Liabilities                          | 123,981 |  |   | 126,984 |  |
| Stockholders' Equity                       | 552,236 |  |   | 514,467 |  |
| Total Liabilities and Stockholders' Equity | $ | 676,217 |  |   | $ | 641,451 |  |

|                                                                                            |
|--------------------------------------------------------------------------------------------|
|                                                                                            |  |  |  |  |  |  |  |  |  |  |  |
|                                                                                            | December 31, 2012 |  | December 31, 2011 |  | December 31, 2010 |
| Income                                                                                     |  |  |  |  |  |  |  |  |
| Dividends from Subsidiaries                                                                | $ | 30,096 |  |  | $ | 4,677 |  |  | $ | 3,256 |  |
| Administrative Services Fees from Subsidiaries                                             |  |  |  |  |  |  | 28,489 |  |
| Other Income                                                                               | 85 |  |  | (11 | ) |  | 190 |  |
| Total Income                                                                               | 30,181 |  |  | 4,666 |  |  | 31,935 |  |
| Expenses                                                                                   |  |  |  |  |  |
| Interest Expense                                                                           | 4,655 |  |  | 7,661 |  |  | 6,816 |  |
| Salaries and Employee Benefits                                                             | 3,194 |  |  | 2,688 |  |  | 25,884 |  |
| Net Occupancy and Equipment Expenses                                                       | 312 |  |  | 31 |  |  | 6,213 |  |
| Telephone Expenses                                                                         | 30 |  |  | 21 |  |  | 918 |  |
| Postage and Courier Expenses                                                               | 1 |  |  | 2 |  |  | 1,786 |  |
| Other Expenses                                                                             | 1,502 |  |  | 1,501 |  |  | 5,382 |  |
| Total Expenses                                                                             | 9,694 |  |  | 11,904 |  |  | 46,999 |  |
| Income (Loss) Before Income Tax Benefit and Equity in Undistributed Income of Subsidiaries | 20,487 |  |  | (7,238 | ) |  | (15,064 | ) |
| Income Tax Benefit                                                                         | 3,316 |  |  | 3,256 |  |  | 5,970 |  |
| Income (Loss) Before Equity in Undistributed Income of Subsidiaries                        | 23,803 |  |  | (3,982 | ) |  | (9,094 | ) |
| Equity in Undistributed (Distributions in Excess of) Income of Subsidiaries                | 21,319 |  |  | 29,234 |  |  | 16,003 |  |
| Net Income                                                                                 | 45,122 |  |  | 25,252 |  |  | 6,909 |  |
| Gain on Exchange of Preferred Stock                                                        |  |  |  |  |  | 11,353 |  |
| Loss on CPP Unamortized Discount                                                           |  |  |  | (1,401 | ) |  | (1,301 | ) |
| Loss on Extinguishment of Trust Preferred Securities                                       |  |  |  | (10,857 | ) |  |  |
| Preferred Stock Dividends and Discount Accretion                                           | (4,539 | ) |  | (3,981 | ) |  | (5,239 | ) |
| Net Income Available to Common Stockholders                                                | $ | 40,583 |  |  | $ | 9,013 |  |  | $ | 11,722 |  |
|                                                                                       |   |   |   |   |   |
| Net Income                                                                                 | $ | 45,122 |  |  | $ | 25,252 |  |  | $ | 6,909 |  |
| Other Comprehensive Income                                                                 | (1,897 | ) |  | 6,555 |  |  | (1,331 | ) |
| Comprehensive Income                                                                       | $ | 43,225 |  |  | $ | 31,807 |  |  | $ | 5,578 |  |

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|                                                                             |
|-----------------------------------------------------------------------------|
|                                                                             |  |  |  |  |  |  |  |  |  |  |  |
|                                                                        | Year Ended December 31, |
|                                                                        | 2012 |  | 2011 |  | 2010 |
| Operating Activities:                                                       |   |  |   |  |   |
| Net Income                                                                  | $ | 45,122 |  |  | $ | 25,252 |  |  | $ | 6,909 |  |
| Adjustments to Reconcile Net Income to Net Cash                             |   |  |   |  |   |
| Provided by Operating Activities                                            |   |  |   |  |   |
| Share-based Compensation                                                    | 632 |  |  | 524 |  |  | 1,750 |  |
| Tax Benefit from Share Based Compensation                                   |  |  |   |  |  | 50 |  |
| Distributions in Excess of (Equity in Undistributed) Income of Subsidiaries | (21,319 | ) |  | (29,234 | ) |  | (16,003 | ) |
| Net Change in:                                                              |   |  |   |  |   |
| Other Assets                                                                | 1,902 |  |  | 5,747 |  |  | 3,309 |  |
| Other Liabilities                                                           | 1,122 |  |  | 1,091 |  |  | (744 | ) |
| Investment in Subsidiaries - Operating Activities                           | (1,755 | ) |  | (6,593 | ) |  | (20 | ) |
| Net Cash Provided (Used) by Operating Activities                            | $ | 25,704 |  |  | $ | (3,213 | ) |  | $ | (4,749 | ) |
| Investing Activities - Investment in Subsidiaries                           | (126 | ) |  | 704 |  |  | (12,500 | ) |
| Net Cash Provided (Used) in Investing Activities                            | $ | (126 | ) |  | $ | 704 |  |  | $ | (12,500 | ) |
| Financing Activities:                                                       |   |  |   |  |   |
| Cash Dividends                                                              | $ | (7,442 | ) |  | $ | (4,729 | ) |  | $ | (5,920 | ) |
| Repayment of Borrowings                                                     | (4,124 | ) |  | (46,400 | ) |  |   |  |
| Preferred stock redemption under Capital Purchase Program                   |  |  |  | (69,600 | ) |  |   |
| Preferred stock issued under Small Business Lending Fund                    |  |  |  | 90,783 |  |  |   |
| Repurchase of Common Stock Warrants under Capital Purchase Program          |  |  |  | (368 | ) |  |   |
| Common Stock Issued                                                         |  |  |  | 21,165 |  |  | 24,150 |  |
| Stock Issued Under Employee Benefit Plans                                   | 449 |  |  | 669 |  |  | 582 |  |
| Stock Issued Under Dividend Reinvestment and Stock Purchase Plan            | 202 |  |  | 89 |  |  | 91 |  |
| Stock Options Exercised                                                     | 78 |  |  |   |  |   |
| Tax Benefit from Share Based Compensation                                   |   |  |   |  |  | (50 | ) |
| Stock Redeemed                                                              | (235 | ) |  | (126 | ) |  | (76 | ) |
| Other                                                                       |  |  |  | 298 |  |  | 198 |  |
| Net Cash Provided (Used) by Financing Activities                            | $ | (11,072 | ) |  | $ | (8,219 | ) |  | $ | 18,975 |  |
| Net Change in Cash                                                          | 14,506 |  |  | (10,728 | ) |  | 1,726 |  |
| Cash, Beginning of the Year                                                 | 20,654 |  |  | 31,382 |  |  | 29,656 |  |
| Cash, End of Year                                                           | $ | 35,160 |  |  | $ | 20,654 |  |  | $ | 31,382 |  |

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|         |                                                                                                                                                                                                                                                                                                                                                                        |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Present (either on the face of the statement where net income is presented or in the notes) the effects on the line items of net income of significant amounts reclassified out of accumulated other comprehensive income-but only if the item reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period. |

|         |                                                                                                                                       |
|---------|---------------------------------------------------------------------------------------------------------------------------------------|
| • | Cross-reference to other disclosures currently required under U.S. GAAP for other reclassification items (that are not required under |

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|             |
|-------------|
|             |  |
| Exhibit No: | Description of Exhibits: |

|       |
|-------|
|       |  |
| 3.1   | First Merchants Corporation Articles of Incorporation, as amended (Incorporated by reference to registrant’s Form 10-Q filed on November 9, 2011) |
| 3.2   | Bylaws of First Merchants Corporation dated October 28, 2009 (Incorporated by reference to registrant’s Form 10-Q filed on November 9, 2009) |
| 3.3   | First Merchants Corporation Articles of Amendment of the Articles of Incorporation for the Series B Preferred Stock (Incorporated by reference to registrant’s Form 8-K filed on September 23, 2011) |
| 4.1   | First Merchants Corporation Amended and Restated Declaration of Trust of First Merchants Capital Trust II dated as of July 2, 2007 (Incorporated by reference to registrant's Form 8-K filed on July 3, 2007) |
| 4.2   | Indenture dated as of July 2, 2007 (Incorporated by reference to registrant's Form 8-K filed on July 3, 2007) |
| 4.3   | Guarantee Agreement dated as of July 2, 2007 (Incorporated by reference to registrant's Form 8-K filed on July 3, 2007) |
| 4.4   | Form of Capital Securities Certification of First Merchants Capital Trust II (Incorporated by reference to registrant's Form 8-K filed on July 3, 2007) |
| 4.5   | First Merchants Corporation Dividend Reinvestment and Stock Purchase Plan (Incorporated by reference to registrant’s Post-Effective Amendment No. 1 to Form S-3 filed on August 21, 2009) |
| 10.1  | First Merchants Corporation Senior Management Incentive Compensation Program, dated February 19, 2013 (1) (2) |
| 10.2  | First Merchants Corporation Equity Compensation Plan for Non-Employee Directors, effective April 29, 2008 (Incorporated by reference to  registrant's Form 10-Q filed on August 11, 2008) (1) |
| 10.3  | First Merchants Corporation Change of Control Agreement, as amended, with Michael C. Rechin dated June 1, 2011 (Incorporated by reference to registrant’s Form 10-Q filed on August 9, 2011) (1) |
| 10.4  | First Merchants Corporation Change of Control Agreement, as amended, with Mark K. Hardwick dated June 1, 2011 (Incorporated by reference to registrant’s Form 10-Q filed on August 9, 2011) (1) |
| 10.5  | First Merchants Corporation Change of Control Agreement, as amended, with Michael J. Stewart dated June 1, 2011 (Incorporated by reference to registrant’s Form 10-Q filed on August 9, 2011) (1) |
| 10.6  | First Merchants Corporation Change of Control Agreement, as amended, with John J. Martin dated June 1, 2011 (Incorporated by reference to registrant’s Form 10-Q filed on August 9, 2011) (1) |
| 10.7  | First Merchants Corporation Change of Control Agreement, as amended, with Jami L. Bradshaw dated June 1, 2011 (Incorporated by reference to registrant’s Form 10-Q filed on August 9, 2011) (1) |
| 10.8  | First Merchants Corporation Change of Control Agreement, as amended, with Robert R. Connors  dated June 1, 2011  (Incorporated by reference to registrant’s Form 10-Q filed on August 9, 2011) (1) |
| 10.9  | First Merchants Corporation Change of Control Agreement, as amended, with Kimberly J. Ellington dated June 1, 2011 (Incorporated by reference to registrant’s Form 10-Q filed on August 9, 2011) (1) |
| 10.10 | First Merchants Corporation Change of Control Agreement, as amended, with Jeffery B. Lorentson dated June 1, 2011 (Incorporated by reference to registrant’s Form 10-Q filed on August 9, 2011) (1) |
| 10.11 | Resolution of the Board of Directors of First Merchants Corporation on director compensation dated December 4, 2007 (Incorporated by reference to the registrant's Form 10-K for year ended December 31, 2007) (1) |
| 10.12 | First Merchants Corporation Supplemental Executive Retirement Plan and amendments thereto (Incorporated by reference to registrant's Form 10-K for year ended December 31, 1997) (1) |
| 10.13 | First Merchants Corporation 2009 Long-Term Equity Incentive Plan effective May 6, 2009 (Incorporated by reference to registrant's form 8-K filed on May 11, 2009) (1) |
| 10.14 | First Merchants Corporation Defined Contribution Supplemental Retirement Plan dated January 1, 2006 (Incorporated by reference to registrant's Form 8-K filed on February 6, 2007) (1) |

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|---------|
|         |  |
| 10.15   | First Merchants Corporation Participation Agreement of Michael C. Rechin dated January 26, 2007 (Incorporated by reference to registrant's Form 8-K filed on February 6, 2007) (1) |
| 10.16   | First Merchants Corporation 2009 Employee Stock Purchase Plan effective July 1, 2009 (Incorporated by reference to registrant's Form 8-K filed on May 11, 2009) (1) |
| 10.17   | First Merchants Corporation Share Purchase Agreement with Castle Creek Capital Partners IV, L.P. and Endicott Opportunity Partners III, L.P. dated September 9, 2011 (Incorporated by reference to registrant’s Form 8-K filed on September 13, 2011) |
| 10.18   | First Merchants Corporation Securities Purchase Agreement with the U.S. Department of Treasury, with respect to the Series B Preferred Stock dated September 22, 2011 (Incorporated by reference to registrant’s Form 8-K filed on September 23, 2011) |
| 10.19   | First Merchants Corporation Repurchase Letter with the U.S. Department of Treasury, with respect to the Designated Preferred Stock dated September 22, 2011 (Incorporated by reference to registrant’s Form 8-K filed on September 23, 2011) |
| 10.20   | First Merchants Corporation Repurchase Letter with the U.S. Department of Treasury, with respect to the Capital Securities dated September 22, 2011 (Incorporated by reference to registrant’s Form 8-K filed on September 23, 2011) |
| 10.21   | 2011 Executive Deferred Compensation Plan, effective January 1,  2011 (Incorporated by reference to registrant’s Form 8-K filed on November 3, 2011) (1) |
| 10.22   | Purchase and Assumption Agreement – Modified Whole Bank; All Deposits, among Federal Deposit Insurance Corporation, receiver of SCB Bank, Shelbyville, Indiana, the Federal Deposit Insurance Corporation and First Merchants Bank, dated as of February 10, 2012 (Incorporated by reference to registrant’s Form 8-K filed on February 13, 2012) |
| 21      | Subsidiaries of Registrant (2) |
| 23      | Consent of Independent Registered Public Accounting Firm (2) |
| 24      | Limited Power of Attorney (2) |
| 31.1    | Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes - Oxley Act of 2002 (2) |
| 31.2    | Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes - Oxley Act of 2002 (2) |
| 32      | Certifications Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (2) |
| 99.1    | Financial statements and independent registered public accounting firm’s report for First Merchants Corporation 2009 Employee Stock Purchase Plan (2004) (2) |
| 99.2    | Certification of Principal Executive Officer and Principal Financial Officer required under §111(b)(4) of the EESA (2) |
| 101.INS | XBRL Instance Document (3) |
| 101.SCH | XBRL Taxonomy Extension Schema Document (3) |
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document (3) |
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document (3) |
| 101.LAB | XBRL Taxonomy Extension Label Linkbase Document (3) |
| 101.PRE | XBRL Taxonomy Extension Presentation Linkebase Document (3) |
|    |   |
|    | (1) Management contract or compensatory plan |
|    | (2) Filed herewith. |
|    | (3) Furnished herewith. |

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Table of Contents

|        |
|--------|
|        |  |  |  |
|   | FIRST MERCHANTS CORPORATION |   |
|   |   |   |
|   |   |   |   |
|   | By: | /s/ Michael C. Rechin |   |
|   | Michael C. Rechin, |   |
|   | President and Chief Executive Officer |   |
|   |   |   |   |

|                                   |
|-----------------------------------|
|                                   |  |
| /s/ Michael C. Rechin             | /s/ Mark K. Hardwick |
| Michael C. Rechin, President and  | Mark K. Hardwick, Executive Vice |
| Chief Executive Officer           | President and Chief Financial Officer |
| (Principal Executive Officer)     | (Principal Financial and Accounting Officer) |
|                                   |  |
| /s/ Michael R. Becher             | /s/ Michael C. Rechin |
| Michael R. Becher, Director       | Michael C. Rechin, Director |
|                                   |  |
| /s/ Roderick English              | /s/ Charles E. Schalliol |
| Roderick English, Director        | Charles E. Schalliol, Director |
|                                   |  |
| /s/ Dr. Jo Ann M. Gora            | /s/ Patrick A. Sherman |
| Dr. Jo Ann M. Gora, Director | Patrick A. Sherman, Director |
|                                   |  |
| /s/ William L. Hoy                | /s/ Terry L. Walker |
| William L. Hoy, Director          | Terry L. Walker, Director |
|                                   |  |
| /s/ Gary J. Lehman                | /s/ Jean L. Wojtowicz |
| Gary J. Lehman, Director          | Jean L. Wojtowicz, Director |

|   |
|---|
|   |  |
| * | By Mark K. Hardwick as Attorney-in Fact pursuant to a Limited Power of Attorney executed by the directors listed above, which Power of Attorney is being filed with the Securities and Exchange Commission as an exhibit hereto. |

|        |
|--------|
|        |  |  |  |
|   | By: | Mark K. Hardwick |   |
|   | Mark K. Hardwick |   |
|   | As Attorney-in-FactMarch 15, 2013 |   |