FIRST MERCHANTS CORPORATION ANNOUNCES THIRD QUARTER 2026 RESULTS
FIRST MERCHANTS CORP (FRME) filed an SEC Form 8-K — Results of Operations and Financial Condition. N / E / W / S R / E / L / E / A / S / E October 21, 2026 FOR IMMEDIATE RELEASE For more information, contact: Nicole M. Weaver, First Vice President and Director of Corporate Administration 765-521-7619 http://www.firstmerchants.com SOURCE: First Merchants Corporation, Muncie, In
Facts are quoted from the filing text and checked against it.
How this was made
The 30-second read
Why it matters
The earnings release provides fresh quantitative data that can shift investor expectations and short‑term price action.
Market read
Fresh earnings data for a mid‑cap regional bank, likely to influence its stock and peers in the banking sector.
What to watch
Potential headwinds from rising interest rates could pressure loan growth despite current earnings strength.
First Merchants reported third-quarter net income available to common stockholders of $67.8 million, or $1.09 per diluted common share, with net interest margin FTE of 3.44%.
Third-quarter earnings, net interest income, margin and deposits increased from both the linked quarter or prior-year period as reported, while net charge-offs were elevated and nonperforming assets remained at 0.57% of assets.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total revenue, three months ended September 30, 2026GAAP | $199.1M | – | – |
| Net interest income, three months ended September 30, 2026GAAP | $161.1M | $2.1 million, or 1.3% | $27.4 million, or 20.5% |
| Net interest margin FTE, three months ended September 30, 2026non-GAAP | 3.44% | up 6 basis points | an increase of 20 basis points |
| Noninterest income, three months ended September 30, 2026GAAP | $38.01M | an increase of $0.8 million | an increase of $5.5 million |
| Noninterest expense, three months ended September 30, 2026GAAP | $116.3M | an increase of $0.9 million | an increase of $19.7 million |
| Provision for credit losses, three months ended September 30, 2026GAAP | $3.3M | – | – |
| Income before income taxes, three months ended September 30, 2026GAAP | $79.52M | – | – |
| Income tax expense, three months ended September 30, 2026GAAP | $11.20M | – | – |
| Net income, three months ended September 30, 2026GAAP | $68.31M | – | – |
| Net income available to common stockholders, three months ended September 30, 2026GAAP | $67.8M | – | – |
| Diluted earnings per common share, three months ended September 30, 2026GAAP | $1.09 | – | up 11 percent |
| Adjusted diluted earnings per common share, three months ended September 30, 2026non-GAAP | $1.10 | – | – |
| Adjusted pre-tax, pre-provision earnings, three months ended September 30, 2026non-GAAP | $83.7M | – | – |
| Efficiency ratio, three months ended September 30, 2026non-GAAP | 54.55% | – | – |
| Return on average assets, three months ended September 30, 2026GAAP | 1.30% | – | – |
| Return on average stockholders' equity, three months ended September 30, 2026GAAP | 10.07 | – | – |
| Net charge-offs, three months ended September 30, 2026GAAP | $29.39M | – | – |
| Net charge-offs as % of average loans (annualized), three months ended September 30, 2026GAAP | 0.75% | – | – |
| Total revenue, nine months ended September 30, 2026GAAP | $552.3M | – | – |
| Net income available to common stockholders, nine months ended September 30, 2026GAAP | $139M | – | – |
| Diluted earnings per common share, nine months ended September 30, 2026GAAP | $2.24 | – | – |
| Adjusted net income available to common stockholders, nine months ended September 30, 2026non-GAAP | $178M | – | – |
| Adjusted diluted earnings per common share, nine months ended September 30, 2026non-GAAP | $2.87 | – | – |
| Total assets, September 30, 2026GAAP | $21.1B | – | – |
| Loans, September 30, 2026GAAP | $15.6B | $70.2 million, or 1.8% annualized | increased $2.0 billion during the last twelve months |
| Total deposits, September 30, 2026GAAP | $16.9B | $175.6 million, or 4.2% annualized | increased by $2.1 billion over the past twelve months |
| Allowance for credit losses - loans, September 30, 2026GAAP | $215.5M | a decrease of $26.1 million | – |
| Allowance for credit losses - loans as % of loans, September 30, 2026GAAP | 1.38% | – | – |
| Nonperforming assets, September 30, 2026GAAP | $119.0M | – | – |
| Nonperforming assets to assets, September 30, 2026GAAP | 0.57% | – | – |
| Common Equity Tier 1 capital ratio, September 30, 2026other | 11.22% | – | – |
| Total risk-based capital ratio, September 30, 2026other | 13.58% | – | – |
| Tangible common equity ratio, September 30, 2026non-GAAP | 8.83% | – | – |
| Cash and due from banks, September 30, 2026GAAP | $86.59M | – | – |
| Total borrowings, September 30, 2026GAAP | $1.19B | – | – |
Amounts quoted below without a unit are in thousands, as in the filing’s tables. Per-share figures are as printed.
Capital returns
- Repurchased 1,264,062 shares of common stock totaling $50.3 million year-to-date, including 287,431 shares totaling $12.0 million in the third quarter.
- Cash dividends paid to common stockholders were $0.37 per share for the three months ended September 30, 2026.
- Cash dividends paid to common stockholders were $1.10 per share for the nine months ended September 30, 2026.
What drove it
- Net interest income increased $2.1 million, or 1.3%, from the prior quarter and $27.4 million, or 20.5%, from the third quarter of 2025.
- The linked-quarter increase in noninterest income primarily reflected higher deposit service charges and an increase in income from CRA investments recorded through Other Income.
- Organic loan growth was $473.7 million, or 3.5%, during the past twelve months, excluding loans acquired through First Savings and the impact of mortgage loan sale activity in the first quarter of 2026.
- The acquisition of First Savings contributed $1.7 billion in deposits.
- Investment securities declined during the quarter due to principal paydowns and maturities, and a decline in the securities portfolio valuation due to increases in interest rates.
Concerns
- Quarterly net charge-offs totaled $29.4 million, driven by two non-performing credits for which specific reserves were established in the prior quarter.
- Nonperforming assets to total assets were 0.57%, compared to 0.56% in the prior quarter and 0.36% at September 30, 2025.
- Total noninterest expense increased $19.7 million from the third quarter of 2025.
- Excluding acquisition costs, noninterest expense increased $3.9 million linked quarter, primarily driven by increases in marketing expense, employee health insurance costs and premises expense.
- Accumulated other comprehensive loss was $(227,937) at September 30, 2026, compared with $(133,593) at June 30, 2026.
What to watch
- The resolution of the two commercial credits identified in the prior quarter and the trajectory of net charge-offs, nonaccrual loans and nonperforming assets.
- Whether loan and deposit growth continues while the loan-to-deposit ratio remains near 92.2%.
- Net interest margin FTE following the third-quarter increase to 3.44%.
- Expense growth following acquisition-related costs and the reported increases in marketing, employee health insurance and premises expense.
- The planned CEO transition, under which President Mike Stewart will succeed Mark Hardwick as Chief Executive Officer upon Mr. Hardwick's retirement at year-end 2026.
Balance sheet and cash flow
- Total assets equaled $21.1 billion as of quarter-end.
- Investment securities totaled $3.1 billion and decreased $257.9 million, or 7.6%, during the last twelve months and decreased $167.6 million on a linked quarter basis.
- Total deposits equaled $16.9 billion as of quarter-end.
- The loan-to-deposit ratio was 92.2% at period end, compared to 92.7% in the prior quarter.
- Completed $100 million subordinated debt issuance in late September.
- Reserves for unfunded commitments totaling $18.5 million remained unchanged from the previous quarter.
Analysis
First Merchants delivered stronger third-quarter profitability following a weak second quarter. Net income available to common stockholders was $67.8 million, or $1.09 per diluted common share, compared with $43.5 million, or $0.70 per diluted common share, in the second quarter of 2026 and $56.3 million, or $0.98 per diluted common share, in the third quarter of 2025. Adjusted diluted earnings per common share were $1.10, compared with $0.74 in the prior quarter and $0.99 a year earlier. The third-quarter result included $0.9 million of acquisition-related costs.
Core revenue momentum was led by net interest income. Net interest income was $161.1 million, increasing $2.1 million, or 1.3%, from the prior quarter and $27.4 million, or 20.5%, from the third quarter of 2025. Net interest margin on a fully taxable equivalent basis was 3.44%, up 6 basis points linked quarter and 20 basis points year over year. Noninterest income totaled $38.0 million, with the linked-quarter increase primarily reflecting higher deposit service charges and income from CRA investments recorded through Other Income.
Balance-sheet growth continued. Loans totaled $15.6 billion and increased $70.2 million, or 1.8% annualized, linked quarter, while deposits totaled $16.9 billion and increased $175.6 million, or 4.2% annualized. Loans increased $2.0 billion during the last twelve months, and First Savings contributed $1.7 billion in deposits. Investment securities totaled $3.1 billion and declined $167.6 million linked quarter due to principal paydowns, maturities and a decline in portfolio valuation due to increases in interest rates. The loan-to-deposit ratio was 92.2%, compared with 92.7% in the prior quarter.
Credit costs remain the principal item requiring attention. Quarterly net charge-offs totaled $29.4 million, driven by two non-performing credits for which specific reserves were established in the prior quarter. The allowance for credit losses on loans decreased $26.1 million from the prior quarter to $215.5 million, or 1.38% of loans, while provision for credit losses was $3.3 million. Nonperforming assets were $119.0 million and nonperforming assets to assets were 0.57%, compared with 0.56% in the prior quarter. The company stated that related credit costs for new nonaccrual loans were recognized in prior quarters.
Expenses increased modestly from the second quarter but remained higher than the prior-year period. Total noninterest expense was $116.3 million, up $0.9 million linked quarter and $19.7 million year over year. Excluding acquisition costs, linked-quarter expense increased $3.9 million, primarily from marketing, employee health insurance and premises expense, including a $0.5 million building lease impairment charge. Capital remained robust, with a 13.58% total risk-based capital ratio, 11.22% common equity tier 1 capital ratio and 8.83% tangible common equity ratio. The company repurchased 287,431 shares totaling $12.0 million during the quarter and completed a $100 million subordinated debt issuance in late September. No forward financial guidance was provided.
Management, verbatim
First Merchants delivered strong third quarter results. Earnings per diluted share were $1.09, up 11 percent from the third quarter of last year, fully taxable equivalent net interest margin 1 rose 6 basis points to 3.44 percent, and deposit growth was solid,
Mark Hardwick, Chief Executive Officer
We made meaningful progress resolving the two commercial credits identified last quarter, and nonperforming assets remained stable. Our capital position remains very strong and we continue to return capital to shareholders through dividends and share repurchases.
Mark Hardwick, Chief Executive Officer
Not in the filing
stated, not guessed- Forward revenue, margin, expense, tax-rate, earnings per share and other financial guidance
- Prior-guidance comparison, as no previous outlook was provided
- Operating cash flow
- Free cash flow
- Gross margin
- Reportable business segment revenue
- A stated tax rate
- Total cash and cash equivalents line item
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
First Merchants Corp (NASDAQ: FRME) filed a Form 8‑K reporting its third‑quarter 2026 financial results.
Ticker impact
First report of First Merchants Corp Q3 2026 results showing net income $67.8M and EPS $1.09, up from prior periods.
likely upward pressure as investors price in better‑than‑expected earnings
The release provides fresh earnings data that exceeds prior quarter and year‑over‑year figures, with improved net interest margin and capital ratios, which typically drives buying interest.
Market effects
Banking sector may see modest lift as a regional bank reports solid earnings and capital strength.
Midwest U.S. regional banks could benefit from perceived stability in loan growth and deposit inflows.
Limited; impact confined to U.S. regional banking niche.
Counterpoint
If the market had already priced in a strong quarter, the modest beat may not trigger a rally and could lead to profit‑taking.
Key entities
- companyFirst Merchants Corp
U.S. regional bank reporting Q3 2026 earnings.
- executiveMike Stewart
President slated to become CEO at year‑end 2026.
