First Merchants Q4 Earnings Call Highlights

First Merchants (NASDAQ:FRME) reported grounds full-year results connected its fourth-quarter 2025 net call, highlighting continued indebtedness and deposit growth, an improving nett involvement margin, and advancement toward its pending acquisition of First Savings Group.

CEO Mark Hardwick said the institution ended 2025 with grounds full assets of $19 billion, grounds full loans of $13.8 billion, and grounds full deposits of $15.3 billion. For the afloat year, First Merchants delivered grounds nett income of $224.1 cardinal and grounds diluted net per stock (EPS) of $3.88, up 13.8% from the anterior year. Fourth-quarter nett income totaled $56.6 million, oregon $0.99 per share.

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Hardwick besides cited profitability metrics for the year, including instrumentality connected assets of 1.21% and instrumentality connected tangible communal equity of 14.08%. The company’s ratio ratio was 54.5% for 2025, and absorption said it achieved “significant operating leverage,” with revenues increasing astir 5 times faster than expenses.

President Mike Stewart said indebtedness maturation was beardown crossed segments and markets. Linked-quarter indebtedness maturation was $197 cardinal (5.8% annualized), and full-year maturation was $939 cardinal (7.3%). Commercial loans drove results, with $153 cardinal of maturation successful the 4th fourth and $852 cardinal twelvemonth to date, supported by CapEx financing, accrued revolver usage, M&A financing, and caller concern conversions. Stewart added that end-of-quarter pipelines were unchangeable from the anterior quarter, supporting his optimism for continued maturation successful aboriginal 2026.

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In user lending, Stewart noted $44 cardinal of fourth-quarter maturation and $87 cardinal for the year, driven by residential mortgage, HELOC, and backstage banking relationships. He said user pipelines were besides accordant with anterior levels.

On deposits, Stewart called the 4th fourth the company’s strongest 4th of deposit growth, led by consumers. He pointed to maturation successful caller households and balances, supported by integer level enhancements and selling efforts. He said full user deposits accrued $155 cardinal successful the quarter, including much than $250 cardinal of non-maturity equilibrium growth.

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In commercialized deposits, Stewart said maturation was driven chiefly by nationalist money depository relationships, which transportation a higher outgo but are tied to section authorities relationships that besides usage treasury services. He besides said higher enactment utilization typically reduces operating deposit relationship balances, reinforcing the company’s absorption connected improving deposit premix done “primary, halfway accounts” and deposit-cost discipline.