2010 Annual report 19
The Strength of Big, the Service of Small
2010 annual report
First merchants Corporation
20 First Merchants Corporation
CoRPoRATE PR oFILE
First merchants Corporation
(nasdaq: FRmE) is the largest
financial holding company based in
Central Indiana. Since 1893, First
merchants has provided the best of
what banking can offer, customer-
valued products and services
delivered locally by bankers who
are known and trusted in their
communities. The Corporation has
grown to include banks with 79
locations in 23 Indiana and 2 ohio
counties, a trust company and a
multi-line insurance company. As of
december 31, 2010 total asset size
of First merchants Corporation was
$4.2 billion.
We are focused on building deep,
lifelong client relationships and
providing maximum shareholder
value. We provide an experience
where customers can bank with their
neighbors, realizing that our business
begins and ends with people.
TABLE oF ConTEnTS
Financial Highlights
To our Stockholders
The Year in Review
Financial Statements
Locations
1
2
4
8
15
directors & Executive officers 17
Corporate Information
17
BAnk dIvISIonS
Bank divisions within the corporation include:
First merchants Bank n.A., in Adams, Brown, delaware, Fayette,
Hamilton, Hendricks, Henry, Howard, Jay, Johnson, madison, miami,
morgan, Randolph, union, Wabash, Wayne in Indiana and Butler County,
ohio.
Lafayette Bank and Trust Company, a division of First merchants Bank
n.A., in Carroll, Clinton, Jasper, montgomery, Tippecanoe and White
counties.
Commerce national Bank, a division of First merchants Bank n.A., in
Franklin County, ohio.
First merchants Trust Company, a division of First merchants Bank, n.A.,
represents one of the largest trust companies in the state of Indiana.
The Corporation also operates First merchants Insurance Group, a
full-service property, casualty, personal lines, and health care insurance
agency.
First Merchants Bank n.A.
lafayette Bank and Trust Company
Commerce national Bank
To deliver superior personalized financial solutions to consumer and closely held commercial clients in diverse
community markets by providing sound advice and products that exceed customer expectations.
mISSIon
FinAnCiAl hiGhliGhTS
(Dollars in thousands, except share data)
YEAR–End BALAnCES
Total Assets
Total loans
Total deposits
Total Stockholders’ equity
RESuLTS oF oPERATIonS
net interest income
Total other income
Provision for loan losses
Total other expenses
net income (loss) available to common stockholders
PER SHARE dATA
net income (loss) Per Share (diluted)
available to common stockholders
Cash dividends Paid – Common
december 31 Book value – Common
december 31 Market value (Bid Price) – Common
FInAnCIAL RATIoS
return on Average Assets
return on Average Stockholders’ equity
Allowance for loan losses as % of Total loans
See Annual Report on Form 10-K for complete consolidated financials.
1
2010 Annual report 21
2010 Annual report
december 31
2010
2009
Percent
Change
$ 4,170,848
2,857,152
3,268,880
454,408
$ 4,480,952
3,277,824
3,536,536
463,785
–
6.9 %
– 12.8
–
–
7.6
2.0
$ 143,569
$ 153,346 –
6.4 %
48,544
46,483
142,311
11,722
51,201
122,176
151,558
(45,742 )
–
5.2
– 62.0
–
6.1
+ 125.6
$
0.48
0.04
15.11
8.86
0.27 %
2.49
2.90
$
(2.17 )
+ 122.1 %
0.47
16.55
5.94
– 91.5
–
8.7
+ 49.2
(0.98 )%
+ 127.6 %
(9.59 )
2.81
+ 126.0
+
3.2
Average Stockholders’ Equity
(in millions)
Net Interest Margin
on Earning Assets
Allowance as % of Loans
Loan to Deposit Ratio
$477 $470
3.71%
3.55%
3.84%
3.74%
3.87%
2.90%
2.81%
100%
102%
103%
98%
91%
$350
$320
$331
1.33%
0.99%
0.98%
’06
’07
’08
’09
’10
’06
’07
’08
’09
’10
’06
’07
’08
’09
’10
’06
’07
’08
’09
’10
2
First Merchants Corporation
To our SToCkholderS:
The results of 2010 are much better than those of 2009
— a $57 million positive swing in profitability and a $14
million improvement in earnings in the fourth quarter over
those of the same quarter of 2009. Certainly a substantial
improvement, but not nearly what we can achieve.
Here are a few comparative highlights: (a more detailed
analysis follows in the “The Year in Review,” beginning on
page 4.) Earnings per share for 2010 were $0.48 compared
with a loss of $2.17 per share in 2009. The improved results
reflected an approximate $10 million gain achieved when
we restructured some of our CPP capital (Government’s
Capital Purchase Program), improved net investment
income, and substantially reduced amounts needed to
provide for loan losses, thus indicating an improving trend
in the quality of our loans.
Simultaneously, our net interest margin improved 13
basis points to 3.87 percent of earning assets from the
previous year. This resulted from additional core deposits,
improved funding costs and reduced interest rates in effect
in 2010. Equally important, our net interest margin was 5.2
percent better than our banking peers.
Finally, earnings from operations were the highest in
our fourth quarter, and it appears that trend is continuing
in 2011, barring any unforeseen events this year. That said,
2010 figures are history, and we believe that shareholders
want to know more about the outlook for 2011.
THE Look AHEAd
First, the economy seems to be recovering from the
doldrums of the past two years. Second, our two largest
Charles E. Schalliol, Chairman, (left) with michael C. Rechin, President & CEo
markets (Indianapolis, Indiana, and Columbus, ohio,) are
achieving improved results largely because we’ve hit upon a
successful marketing strategy that attracts higher-income,
financially sound commercial borrowers. As a result, we
are able to channel funds beyond the needs of our mature
markets into these growing markets without the usual
costs to fund these additional loans. Because these are
quality relationships located in markets where we already
have staff to administer and service these relationships, our
costs relative to them are more economical.
oPTImAL SIzE
The costs to a be a public corporation and an FdIC insured
bank weigh disproportionately heavily on small bank
holding companies, as they have relatively few bank offices
to absorb these costs. As a result they have little left over
for marketing ventures and improving customer services.
“marked improvements throughout the Company
enabled us to earn demonstrably more in 2010
than in 2009. more important, we are better
positioned in all of our markets to drive earnings
even higher.”
— Michael C. Rechin, President and CEO
2010 Annual report
3
Consequently, their ability to compete is challenged. Some
may become available for mutually beneficial acquisitions
that will fit well within our community banking model. With
more than $4 billion in assets we are well positioned to
secure additional growth in the marketplace.
our size (the largest in central Indiana) relative to the
national banking giants also plays in our favor: Simply stated,
we are more nimble and able to prioritize service.
our ability to move quickly becomes strategically deci-
sive in delivering customer service. This we think will prove
to be the factor that determines future banking prosperity.
Size also impacts costs. The smaller banks find their
pay structure insufficient to attract outstanding personnel,
and the giant national banks have layers of bureaucracy
that slow the decision process and make many loans less
profitable.
In short we’re large enough to outcompete smaller
banks when it comes to introducing and delivering new
products and services and yet agile enough to outmaneuver
the larger banks when it comes to personalized service.
While attractive acquisitions will almost certainly
become available in the years ahead, we do not rely on
them as the primary driver to boost earnings. Rather,
we believe the lion’s share of our results will be derived
primarily from expanding our core business, which is
precisely our focus for the next several years.
visible to the investing community. Given what the near-
term future appears to hold, we believe that value investors
may well be attracted to our stock as it is presently selling
for just under 90 percent of tangible book value.
We plan to utilize our website more effectively and
make our investment rationale more transparent to our
shareholders.
Further, we recognize the present dividend falls short of
what income investors require. We plan to address this as
soon as a larger payout becomes assuredly sustainable.
Finally, at the start of 2010, we challenged our
associates to deliver the service that would be the envy in
all of our markets, streamlined our operations to bring us
a unified front throughout our systems and improved our
capital structure to enable us to thrive as we embark upon
the next phase of our growth plan. We believe we are well
on our way.
Sincerely,
michael C. Rechin
President and CEo
SHAREHoLdER RELATIonS
A sizable portion of our plan going forward is to make the
inherent worth of our bank holding company more readily
Charles E. Schalliol
Chairman of the Board
march 21, 2011
Total Capital to
Risk-weighted Assets
Tier 1 Capital to
Risk-weighted Assets
Tier 1 Capital
to Average Assets
Tangible Capital
to Tangible Assets
15.74%
13.04%
11.09%
10.55%10.24%
12.82%
10.32%
9.18%
8.75%
7.71%
9.50%
5.67%
5.72%
5.86%
8.16%
8.20%
7.37%
7.19%
5.01%
4.54%
’06
’07
’08
’09
’10
’06
’07
’08
’09
’10
’06
’07
’08
’09
’10
’06
’07
’08
’09
’10
The YeAr in review
ImPRovEmEnTS In SToCkHoLdERS’ EquITY
our efforts during this past year resulted in improved
performance throughout the organization. our primary
efforts were to improve our capital structure, specifically
the mix of Hybrid Capital and Equity Capital. Here’s
what we did and why it’s important.
In February 2009, we decided to participate in the u.S.
Treasury’s voluntary Capital Purchase Program (CPP)
and received $116 million in equity capital by issuing
116,000 shares of Preferred Stock and a warrant to
purchase additional shares of the company’s common
stock.
Fast forward to march of 2010. Here we took the
initiative and presented the u.S. Treasury with a
proposal to exchange $46.4 million of the Company’s
cumulative perpetual preferred stock for trust preferred
securities. They agreed, and on June 30th we completed
the transaction, which resulted in a $10.1 million gain
due to the favorable accounting treatment of the
newer securities. This transaction increased the holding
company’s Tangible Common Equity Ratio nearly 25 basis
points.
Second, we raised $24.15 million in private placement
equity by selling 4.2 million common shares to six
different institutional investors. All told these activities
improved the bank’s key capital ratios to even healthier
levels and substantially above the “well capitalized”
regulatory guidelines.
4
First Merchants Corporation
Top: Because of the accelerated growth of their
Company, mr. Patrick James, CEo and david Washburn
of Heritage Technologies partnered with First
merchants and secured $11.5 million in loans to build
a 30,000 sq. ft. expansion to add new product lines to
their mirconutrient business. Middle: Home to Super
Bowl 2012, Indianapolis is growing faster than the
national average and is one of the Bank’s fastest growing
markets. Right: We grew deposits last year in our
Lafayette market, home to the Purdue Research Park
where more than 140 companies working in the fields
of life sciences, advanced manufacturing and engineering,
have originated. First merchants has developed several
banking relationships with companies located at the 725
acre campus just north of Purdue university.
2010 Annual report
5
A RETuRn To PRoFITABILITY
For the year, the Company earned $0.48 cents
per common share from net income totaling $11.7
million. This compares quite favorably to 2009’s
results of a loss of $2.17 per common share and a
net loss of $45.7 million. The $57 million swing to
the positive was driven by prudent management
of the loan portfolio which resulted in a dramatic
$75.7 million reduction in the provision for loan
losses to $46.5 million compared with $122.2
million in 2009. net interest income after provi-
sion for loan losses increased 211% to $97 million,
up from $31.1 million in 2009. This, along with a
reduction in our expenses, proved our resiliency
to adapt to what is still a sluggish economy.
Above: not content to
stand pat, the Bank contin-
ues to invest in its mature
markets. First merchants is
investing nearly $1 million to
upgrade its madison Street
location in muncie.
Because of a nation-wide consumer focus on reducing debt and much
uncertainty in the job market, our total assets were down $311 million to $4.17
billion at the end of 2010. We simply did not lend as much money last year as
we did in 2009, and total loans, including those held for sale decreased by $421
million to $2.86 billion.
However, we did not sit idle. We used the additional liquidity to pay down
higher-priced deposit liabilities and advances from the Federal Home Loan Bank.
These reductions totaled $400 million for 2010.
Further, we took the remaining surplus funds and reinvested them in our
investment portfolio which now totals $827 million, an increase of $264 million
during the past year. Its yield is an enviable 4.15% compared with our peer
group’s average of approximately 3.75%. management has worked diligently on
the portfolio and is pleased with its position over the near term.
THE onLY ConSTAnT IS CHAnGE
one of the most important accomplishments last year was the melding of our
back-office operations into one common platform that will enable us to move
decisively quicker and more profitably when we implement system wide changes
in our efforts to better serve our customer. Part of it was necessitated because
of the various banking charters that we maintained and part of it was caused by
the evolution of banking software. Previously the Company had nine different
charters. now we have one. This has become increasingly important as a direct
result of the dramatic changes in the banking industry and the demographic
changes of our customers.
6
First Merchants Corporation
In 1990 there were
slightly more than
15,000 banks. Today
that number is 7,830.
This consolidation is
expected to accelerate
in the next five years
with estimates putting
the number of banks
at 5,000, an additional
33% reduction.
In addition to
consolidation, banks
today are faced with
the online banking
explosion of services.
Households banking on
line grew 170% from
2001 to 2009. mobile
banking software,
unheard of a few years
ago, is now available for
Above: Columbus, OH: our custom marketing program, unheard of for a bank our size,
is geared toward privately held companies with an emphasis in healthcare. The Bank provided
several loans to drs. Love and Barry that enabled them to greatly expand their dental practice
as well as assisted them in restructuring the partnership. While the dental practice had several
competitive banking bids to chose from ultimately their access to the Bank’s senior management
for counsel and service let them choose First merchants’ division, Commerce national.
2010 Annual report
7
Small business
loans will help
drive earnings
in our markets
in 2011.
just about every smartphone. Generation Y consumers
value mobile device capabilities more than the availability
of branches and ATms when choosing a bank. Couple
this definite transition from a physical to a virtual
distribution of banking services and one can see how a
single platform from which new services and features
can be implemented immediately delivers a compelling
argument for First merchants. As banking regulations
become increasingly onerous for smaller banks, even the
higher performing ones will have to consider a merger if
they want to serve these changing demographics.
our back-office operations center is intelligently
designed to handle a demonstrably larger asset base than
it does currently with no discernible increase in expense.
BoARd oF dIRECToRS CHAnGES
We wish to acknowledge the departure of two board
members. Thomas Clark has chosen to not stand for
reelection after 22 years of faithful and valuable service.
Barry Hudson is leaving us because he has reached the
mandatory retirement age for our directors. Barry
joined us with the acquisition of First national Bank of
Portland in 1999 and has been a banking and community
leader in our East Central Indiana markets. Their candor
and advice in these trying times were especially valuable,
and each will be sorely missed.
We wish them well in their future endeavors.
Total Return Performance
The following graph compares the cumulative 5-year total return to shareholders on First merchants Corporation’s common stock
relative to the cumulative total returns of the Russell 2000 index and the SnL Bank $1B – $5B index. The graph assumes that the value
of the investment in the Corporation’s common stock and in each of the indexes (including reinvestment of dividends) was $100 on
december 31, 2005 and tracks it through december 31, 2010.
E
u
L
A
v
x
E
d
n
I
140
120
100
80
60
40
20
0
First Merchants Corporation
russell 2000
Snl Bank $1B–$5B
12/31/05
12/31/06
12/31/07
12/31/08
12/31/09
12/31/10
Index
dec. 31, 2005
dec. 31, 2006
dec. 31, 2007
dec. 31, 2008
dec. 31, 2009
dec. 31, 2010
First merchants Corporation
Russell 2000
SnL Bank $1B-$5B
100.00
100.00
100.00
108.47
118.37
115.72
90.75
116.51
84.29
96.23
77.15
69.91
27.29
98.11
50.11
40.91
124.46
56.81
The stock price performance included in this graph is not necessarily indicative of future stock price performance.
8
First Merchants Corporation
Five–YeAr SuMMAr Y oF SeleCTed FinAnCiAl d ATA
(Dollars in thousands, except share data)
2010
2009
2008
2007
2006
oPERATIonS (1)
net interest income Fully Taxable equivalent (FTe) Basis
less Tax equivalent Adjustment
net interest income
Provision for loan losses
net interest income After Provision for loan losses
Total other income
Total other expenses
Income (Loss) Before Income Tax Expense (Benefit)
Income Tax Expense (Benefit)
net income (loss)
Gain on exchange of Preferred Stock to Trust Preferred debt
Preferred Stock dividends and discount Accretion
net income (loss) Available to Common Stockholders
PER SHARE dATA
Basic net income (loss) Available to Common Stockholders
diluted net income (loss) Available to Common Stockholders
Cash dividends Paid – Common
december 31 Book value – Common
december 31 Tangible Book value – Common
december 31 Market value (Bid Price) – Common
$
$
$ 149,434 $ 159,068 $ 133,083 $ 117,247 $ 114,076
5,865
5,722
3,699
4,127
3,981
8,507
28,238
36,367
46,483 122,176
97,086
48,544 51,201
143,569 153,346 129,384 113,120 110,095
6,258
31,170 101,146 104,613 103,837
40,551 34,613
142,311 151,558 108,792 102,182 96,057
42,982 42,393
11,343 12,195
31,639 30,198
3,319
(3,590 )
6,303
10,052
5,239
11,722 $ (45,742 ) $ 20,638 $ 31,639 $ 30,198
(69,187 )
(28,424 )
(40,763 )
28,721
8,083
20,638
4,979
0.48 $
0.48
0.04
15.11
9.21
8.86
(2.17 ) $
(2.17 )
0.47
16.55
9.25
5.94
1.14 $
1.14
0.92
18.69
10.93
22.21
1.73 $
1.73
0.92
18.88
11.60
27.84
1.64
1.64
0.92
17.75
10.52
27.19
AvERAGE BALAnCES (2)
Total Assets
Total loans (3)
Total deposits
$ 4,271,715 $ 4,674,590 $ 3,811,166 $ 3,639,772 $ 3,371,386
3,050,850 3,546,316 3,002,628 2,794,824 2,569,847
3,337,747 3,603,509 2,902,902 2,752,443 2,568,070
Securities Sold under repurchase Agreements (long-term portion)
24,250
107,753 243,105 237,791 259,463 234,629
Total Federal home loan Bank Advances
Total Subordinated debentures, revolving Credit lines and Term loans 126,650 110,826 107,752 104,680 99,456
470,379 477,148 349,594 330,786 319,519
Total Stockholders’ equity
23,813
24,250
34,250
YEAR-End BALAnCES (1)
Total Assets
Total loans (2)
Total deposits
$ 4,170,848 $ 4,480,952 $ 4,784,155 $ 3,782,087 $ 3,554,870
2,857,152 3,277,824 3,726,247 2,880,578 2,698,014
3,268,880 3,536,536 3,718,811 2,884,121 2,750,538
Securities Sold under repurchase Agreements (long-term portion)
24,250
34,250
82,684 129,749 360,217 294,101 242,408
Total Federal home loan Bank Advances
Total Subordinated debentures, revolving Credit lines and Term loans 226,440 194,790 135,826 115,826 83,956
454,408 463,785 395,903 339,936 327,325
Total Stockholders’ equity
34,250
24,250
FInAnCIAL RATIoS (1)
return on Average Assets
return on Average Stockholders’ equity
Average earning Assets to Total Assets (1)
Allowance for loan losses as % of Total loans
dividend Payout ratio
Average Stockholders’ equity to Average Assets
Tax equivalent Yield on earning Assets
Cost of Supporting liabilities
net interest Margin on earning Assets
0.27 %
2.49
90.42
2.90
8.33
11.01
5.32
1.45
3.87
-0.98 %
(9.59 )
94.74
2.81
n/m (3)
10.21
5.56
1.82
3.74
0.54 %
5.90
72.39
1.33
80.70
9.17
6.44
2.60
3.84
0.87 %
9.56
90.15
0.98
53.18
9.09
7.10
3.55
3.55
0.90 %
9.45
91.15
0.99
56.10
9.48
6.92
3.21
3.71
The following selected data has been taken from the Corporation’s consolidated financial statements. Refer to First Merchants Corporation’s Annual Report on Form 10-K for
complete consolidated financials.
(1) On December 31, 2008, the Corporation acquired 100 percent of the outstanding stock of Lincoln Bancorp, the holding company of Lincoln Bank, which was located in Plainfield, Indiana. Lincoln Bank
was a state chartered bank with branches in central indiana. lincoln Bancorp was merged into the Corporation and in 2009, lincoln Bank was ultimately merged into First Merchants Bank, national
Association, a subsidiary of the Corporation. The Corporation issued approximately 3,040,415 shares of its common stock at a cost of $19.78 per share and approximately $16.8 million in cash to
complete the transaction. As a result of the acquisition, the Corporation has an opportunity to increase its customer base and continue to increase its market share. The purchase had a recorded
acquisition price of $77,290,000, including investments of $122,093,000; loans of $628,277,000, premises and equipment of $15,624,000; other assets of $86,091,000; deposits of $655,370,000;
other liabilities of $136,280,000 and goodwill of $19,813,000. Additionally, core deposit intangibles totaling $12,461,000 were recognized and will be amortized over ten years. The combination
was accounted for under the purchase method of accounting. All assets and liabilities were recorded at their fair values as of december 31, 2008. The purchase accounting adjustments are being
amortized over the life of the respective asset or liability.
(2) includes loans held for sale.
(3) not meaningful.
ConSolid ATed B AlAnCe SheeTS
(Dollars in thousands, except share data)
ASSETS
Cash and due from banks
Federal funds sold
Cash and cash equivalents
interest-bearing time deposits
investment securities available for sale
investment securities held to maturity (fair value of $286,270 and $147,336)
Mortgage loans held for sale
loans
less: Allowance for loan losses
net loans
Premises and equipment
Federal reserve and Federal home loan Bank stock
interest receivable
Core deposit intangibles
Goodwill
Cash surrender value of life insurance
other real estate owned
Tax asset, deferred and receivable
other assets
ToTAL ASSETS
LIABILITIES
deposits:
noninterest-bearing
interest-bearing
Total deposits
Borrowings:
Securities sold under repurchase agreements
Federal home loan Bank advances
Subordinated debentures, revolving credit lines and term loans
Total Borrowings
interest payable
other liabilities
Total Liabilities
CommITmEnTS And ConTInGEnT LIABILITIES
SToCkHoLdERS’ EquITY
Preferred Stock, no-par value:
Authorized – 500,000 shares
Series A, issued and outstanding – 69,600 and 116,000 shares
Cumulative Preferred Stock, $1,000 par value, $1,000 liquidation value:
Authorized – 600 shares
issued and outstanding – 125 shares
Common Stock, $.125 stated value:
Authorized – 50,000,000 shares
issued and outstanding – 25,574,251 and 21,227,741 shares
Additional paid-in capital
retained earnings
Accumulated other comprehensive loss
Total Stockholders’ Equity
ToTAL LIABILITIES And SToCkHoLdERS’ EquITY
See Annual Report on Form 10-K for complete consolidated financials.
2010 Annual report
9
december 31,
2010
2009
$
50,844
7,463
58,307
65,216
539,370
287,427
21,469
2,835,683
(82,977 )
2,752,706
52,450
33,884
18,674
12,662
141,357
96,731
20,927
45,623
24,045
$ 4,170,848
$ 583,696
2,685,184
3,268,880
109,871
82,684
226,440
418,995
4,262
24,303
3,716,440
76,801
$
102,346
179,147
74,025
413,607
149,510
8,036
3,269,788
(92,131 )
3,177,657
55,804
38,576
20,818
17,383
141,357
94,636
14,879
64,394
31,123
$ 4,480,952
$ 516,487
3,020,049
3,536,536
125,687
129,749
194,790
450,226
5,711
24,694
4,017,167
67,880
112,373
125
125
3,197
232,503
160,860
(10,157 )
454,408
$ 4,170,848
2,653
206,600
150,860
(8,826 )
463,785
$ 4,480,952
10 First Merchants Corporation
ConSolid ATed STATeMenTS oF oPerATionS
(Dollars in thousands, except share data)
InTEREST InComE
loans receivable:
Taxable
Tax-exempt
investment securities:
Taxable
Tax-exempt
Federal funds sold
Deposits with financial institutions
Federal reserve and Federal home loan Bank stock
Total Interest Income
InTEREST ExPEnSE
deposits
Federal funds purchased
Securities sold under repurchase agreements
Federal home loan Bank advances
Subordinated debentures, revolving credit lines and term loans
Total Interest Expense
nET InTEREST InComE
Provision for loan losses
nET InTEREST InComE AFTER PRovISIon FoR LoAn LoSSES
oTHER InComE
Service charges on deposit accounts
Fiduciary activities
other customer fees
Commission income
earnings on cash surrender value of life insurance
net gains and fees on sales of loans
net realized gains on sales of available for sale securities
other-than-temporary impairment on available for sale securities
Portion of loss recognized in other comprehensive income before taxes
net impairment losses recognized in earnings
other income
Total other Income
oTHER ExPEnSES
Salaries and employee benefits
net occupancy
equipment
Marketing
outside data processing fees
Printing and office supplies
Core deposit amortization
FdiC assessments
other real estate owned and credit related expenses
other expenses
Total other Expenses
InComE (LoSS) BEFoRE InComE TAx
Income tax expense (benefit)
nET InComE (LoSS)
Gain on exchange of preferred stock for trust preferred debt
Preferred stock dividends and discount accretion
nET InComE (LoSS) AvAILABLE To Common SToCkHoLdERS
nET InComE (LoSS) AvAILABLE To Common SToCkHoLdERS PER SHARE:
Basic
diluted
See Annual Report on Form 10-K for complete consolidated financials.
2010
december 31,
2009
2008
$ 174,070
515
$ 205,616
1,038
$ 198,385
1,013
12,957
10,377
26
381
1,252
199,578
39,876
5
1,712
5,368
9,048
56,009
143,569
46,483
97,086
13,283
7,692
8,990
6,225
2,098
6,806
3,406
(3,049 )
1,505
(1,544 )
1,588
48,544
73,253
9,935
7,323
1,970
5,093
1,259
4,721
8,121
12,436
18,200
142,311
3,319
(3,590 )
6,909
10,052
(5,239 )
$ 11,722
12,335
9,587
118
366
1,379
230,439
58,391
28
1,997
9,232
7,445
77,093
153,346
122,176
31,170
15,128
7,409
7,922
6,397
1,614
6,849
11,141
(11,134 )
4,405
(6,729 )
1,470
51,201
76,325
10,250
7,595
2,134
6,186
1,419
5,109
10,394
9,823
22,323
151,558
(69,187 )
(28,424 )
(40,763 )
(4,979 )
$ (45,742 )
12,046
5,855
28
755
1,391
219,473
67,581
1,856
2,600
11,168
6,884
90,089
129,384
28,238
101,146
13,002
8,031
6,776
5,824
(267 )
2,490
599
(2,682 )
(2,682 )
2,594
36,367
63,006
7,711
6,659
2,311
4,087
1,214
3,216
857
2,785
16,946
108,792
28,721
8,083
20,638
$ 20,638
$
$
0.48
0.48
$
$
(2.17 )
(2.17 )
$
$
1.14
1.14
2010 Annual report 11
ConSolid ATed STATeMenTS oF CoMPrehenSive inCoMe (loSS)
(Dollars in thousands, except share data)
net income (loss)
other comprehensive income (loss), net of tax:
unrealized holding gain (loss) on securities available for sale arising
during the period, net of tax of $106, ($5,587) and $1,356
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 $539, $1,333 and $0
Unrealized gains (losses) on cash flow hedges:
unrealized gains (losses) arising during the period,
net of tax of ($155), $622 and ($1)
Reclassification adjustment for gains (losses) included in net income
net of tax of $652, $1,544 and ($833)
Defined Benefit Pension Plans, net of tax of ($526), ($1,826) and $7,689
net Gain Arising during Period
Prior Service Cost Arising during Period
Amortization of Prior Service Cost
Comprehensive income (loss)
2010
december 31,
2009
2008
$ 6,909
$ (40,763 )
$ 20,638
(197 )
10,376
(2,518 )
(1,001 )
(2,476 )
288
(933 )
2
(1,210 )
(2,868 )
1,250
156
583
50
(1,331 )
$ 5,578
3,043
(326 )
22
6,838
$ (33,925 )
(11,518 )
(15 )
(12,799 )
$ 7,839
The following table represents the components of accumulated other comprehensive income:
(Dollars in thousands)
net unrealized gain (loss) on securities available for sale
net unrealized loss on securities available for sale for which a portion of
an other-than-temporary impairment has been recognized in income
Net realized gain on cash flow hedges
Defined Benefit Plans
See Annual Report on Form 10-K for complete consolidated financials.
december 31,
2010
2009
$ 2,767
$
6,650
(1,001 )
(2,476 )
288
(12,211 )
$ (10,157 )
(13,000 )
$
(8,826 )
12 First Merchants Corporation
ConSolid ATed STATeMenTS oF ST oCkholderS’ equiTY
(Dollars in thousands, except share data)
BALAnCES, dECEmBER 31, 2007
net income for 2008
Cash dividends ($.92 per Share)
effects of changing the pension plan measurement date pursuant to FASB no. 158
Service Cost, interest cost and expected rate of return on plan assets for
october 1 – december 31, 2009, net of tax
Amortization of prior service costs for october 1 – december 31, 2007, net of tax
Cumulative preferred stock issued
other Comprehensive income (loss), net of Tax
Tax Benefit from Stock Options Exercised
Share-based Compensation
Stock Issued Under Employee Benefit Plans
Stock issued under dividend reinvestment and Stock Purchase Plan
Stock options exercised
Stock redeemed
issuance of Stock related to Acquisitions
BALAnCES, dECEmBER 31, 2008
net loss for 2009
Cash dividends on Common Stock ($.47 per Share)
Cash dividends on Preferred Stock under Capital Purchase Program
warrants issued under Capital Purchase Program
Accretion of discount on Preferred Stock
Preferred Stock issued under Capital Purchase Program
other Comprehensive income, net of Tax
Tax Benefit from Stock Options Exercised
Share-based Compensation
Stock Issued Under Employee Benefit Plans
Stock issued under dividend reinvestment and Stock Purchase Plan
Stock options exercised
Stock redeemed
Adjustment to issuance of stock related to acquisition
BALAnCES, dECEmBER 31, 2009
Comprehensive income
net income
other Comprehensive income, net of Tax
Cash dividends on Common Stock ($.04 per Share)
Cash dividends on Preferred Stock under Capital Purchase Program
Cumulative Preferred Stock Converted to Trust Preferred Securities
Accretion of discount on Preferred Stock
Private Stock issuance
Tax Benefit (Loss) from Stock Options Exercised
Share-based Compensation
Stock Issued Under Employee Benefit Plans
Stock issued under dividend reinvestment and Stock Purchase Plan
Stock redeemed
BALAnCES, dECEmBER 31, 2010
See Annual Report on Form 10-K for complete consolidated financials.
Preferred
Shares
Amount
Common Stock
Shares
18,002,787
Amount
$ 2,250
Additional
Paid in Capital
$ 137,801
Accumulated other
Comprehensive
income (loss)
$ (2,865 )
125
$
125
(12,799 )
(12,799 )
125
$
125
$ 2,647
$ 206,496
$ (15,664 )
116,000
619
111,754
116,125
$ 112,498
$ 2,653
$ 206,600
$ 150,860
$ (8,826 )
(46,400 )
(45,099 )
606
4,200,000
525
23,625
69,725
$ 68,005
25,574,251
$ 3,197
$ 232,503
$ 160,860
$ (10,157 )
$ 454,408
retained
earnings
$ 202,750
20,638
(16,775 )
(64 )
(53 )
(40,763 )
(9,985 )
(4,269 )
(619 )
6,909
(989 )
(5,366 )
10,052
(606 )
Total
$ 339,936
20,638
(16,775 )
(64 )
(53 )
125
156
1,898
773
1,021
1,633
(2,188 )
61,602
$ 395,903
(40,763 )
(9,985 )
(4,269 )
4,245
—
111,754
6,838
60
2,294
825
527
(193 )
(3,451 )
$ 463,785
6,909
(1,331 )
(989 )
(5,366 )
(35,047 )
—
24,150
(50 )
1,750
582
91
(76 )
6,838
(1,331 )
225
50,119
44,554
122,890
(134,169 )
3,091,717
21,178,123
50,564
122,572
65,015
(14,059 )
(174,474 )
21,227,741
49,833
97,966
11,545
(12,834 )
1
6
6
15
(17 )
386
6
16
8
(2 )
(22 )
6
12
2
(1 )
156
1,897
767
1,015
1,618
(2,171 )
61,216
$ 202,299
4,245
60
2,288
809
519
(191 )
(3,429 )
(50 )
1,744
570
89
(75 )
(Dollars in thousands, except share data)
BALAnCES, dECEmBER 31, 2007
net income for 2008
Cash dividends ($.92 per Share)
effects of changing the pension plan measurement date pursuant to FASB no. 158
Service Cost, interest cost and expected rate of return on plan assets for
october 1 – december 31, 2009, net of tax
Amortization of prior service costs for october 1 – december 31, 2007, net of tax
Preferred
Shares
Amount
Common Stock
Shares
18,002,787
Amount
$ 2,250
Additional
Paid in Capital
$ 137,801
225
50,119
44,554
122,890
(134,169 )
3,091,717
21,178,123
1
6
6
15
(17 )
386
$ 2,647
retained
earnings
$ 202,750
20,638
(16,775 )
(64 )
(53 )
Accumulated other
Comprehensive
income (loss)
$ (2,865 )
(12,799 )
$ 206,496
$ (15,664 )
(40,763 )
(9,985 )
(4,269 )
(619 )
6,838
156
1,897
767
1,015
1,618
(2,171 )
61,216
$ 202,299
4,245
60
2,288
809
519
2010 Annual report 13
Total
$ 339,936
20,638
(16,775 )
(64 )
(53 )
125
(12,799 )
156
1,898
773
1,021
1,633
(2,188 )
61,602
$ 395,903
(40,763 )
(9,985 )
(4,269 )
4,245
—
111,754
6,838
60
2,294
825
527
(193 )
(3,451 )
$ 463,785
6,909
(1,331 )
(989 )
(5,366 )
(35,047 )
—
24,150
(50 )
1,750
582
91
(76 )
$ 454,408
6
16
8
50,564
122,572
65,015
(14,059 )
(174,474 )
21,227,741
(2 )
(22 )
$ 2,653
(191 )
(3,429 )
$ 206,600
$ 150,860
$ (8,826 )
4,200,000
525
49,833
97,966
11,545
(12,834 )
25,574,251
6
12
2
(1 )
$ 3,197
23,625
(50 )
1,744
570
89
(75 )
$ 232,503
(1,331 )
6,909
(989 )
(5,366 )
10,052
(606 )
$ 160,860
$ (10,157 )
Cumulative preferred stock issued
other Comprehensive income (loss), net of Tax
Tax Benefit from Stock Options Exercised
Share-based Compensation
Stock Issued Under Employee Benefit Plans
Stock options exercised
Stock redeemed
issuance of Stock related to Acquisitions
BALAnCES, dECEmBER 31, 2008
net loss for 2009
Stock issued under dividend reinvestment and Stock Purchase Plan
Cash dividends on Common Stock ($.47 per Share)
Cash dividends on Preferred Stock under Capital Purchase Program
warrants issued under Capital Purchase Program
Accretion of discount on Preferred Stock
Preferred Stock issued under Capital Purchase Program
other Comprehensive income, net of Tax
Tax Benefit from Stock Options Exercised
Share-based Compensation
Stock Issued Under Employee Benefit Plans
Stock issued under dividend reinvestment and Stock Purchase Plan
Adjustment to issuance of stock related to acquisition
Stock options exercised
Stock redeemed
BALAnCES, dECEmBER 31, 2009
Comprehensive income
net income
other Comprehensive income, net of Tax
Cash dividends on Common Stock ($.04 per Share)
Cash dividends on Preferred Stock under Capital Purchase Program
Cumulative Preferred Stock Converted to Trust Preferred Securities
Accretion of discount on Preferred Stock
Private Stock issuance
Tax Benefit (Loss) from Stock Options Exercised
Share-based Compensation
Stock Issued Under Employee Benefit Plans
Stock issued under dividend reinvestment and Stock Purchase Plan
Stock redeemed
BALAnCES, dECEmBER 31, 2010
See Annual Report on Form 10-K for complete consolidated financials.
125
$
125
125
$
125
116,000
619
111,754
116,125
$ 112,498
(46,400 )
(45,099 )
606
69,725
$ 68,005
14 First Merchants Corporation
ConSolid ATed STATeMenTS oF C ASh FlowS
(Dollars in thousands)
Cash Flow From operating Activities:
net income (loss)
Adjustments to reconcile net income (loss) to net cash
provided by operating activities:
Provision for loan losses
depreciation and amortization
Change in deferred taxes
Share-based compensation
Tax expense (benefit) from stock options exercised
Mortgage loans originated for sale
Proceeds from sales of mortgage loans
Gains on sales of securities available for sale
recognized loss on other-than-temporary-impairment
Change in interest receivable
Change in interest payable
Pension adjustment for measurement date change
other adjustments
net cash provided by operating activities
Cash Flows from investing Activities:
net change in interest-bearing deposits
Purchases of:
Securities available for sale
Securities held to maturity
Proceeds from sales of securities available for sale
Proceeds from maturities of
Securities available for sale
Securities held to maturity
Proceeds from sales of mortgages
Change in Federal reserve and Federal home loan Bank stock
Purchase of bank owned life insurance
net cash paid in acquisitions
net change in loans
Proceeds from the sale of other real estate owned
other adjustments
net cash provided by (used in) investing activities
Cash Flows from Financing Activities:
net change in :
demand and savings deposits
Certificates of deposit and other time deposits
Borrowings
repayment of borrowings
Cash dividends on common stock
Cash dividends on preferred stock
Stock issued in private equity placement
Stock issued under employee benefit plans
Stock issued under dividend reinvestment and stock purchase plans
Stock options exercised
Cumulative preferred stock issued
Tax (expense) benefit from stock options exercised
Stock redeemed
Net cash provided by (used in) financing activities
net Change in Cash and Cash equivalents
Cash and Cash equivalents, January 1
Cash and Cash equivalents, december 31
Additional cash flows information:
interest paid
income tax paid (refunded)
exchange of preferred stock for trust preferred debt
loans transferred to other real estate owned
See Annual Report on Form 10-K for complete consolidated financials.
2010
december 31,
2009
2008
$
6,909
$ (40,763 )
$
20,638
46,483
5,702
(1,810 )
1,750
50
(254,712 )
241,279
(3,406 )
1,544
2,144
(1,449 )
36,567
$ 81,051
122,176
5,962
(10,858 )
2,294
(60 )
(305,778 )
302,037
(11,141 )
6,729
3,158
(3,133 )
(53,013 )
$ 17,610
28,238
4,613
(8,666 )
1,898
(156 )
(102,591 )
104,250
(599 )
2,682
2,858
(1,217 )
(117 )
(12,818 )
39,013
$
$
8,809
$ (35,202 )
$
10,716
(311,465 )
(180,311 )
117,804
65,688
40,825
4,692
345,518
20,641
(2,348 )
$ 109,853
$ 84,993
(352,649 )
2,382
(65,247 )
(989 )
(4,931 )
24,150
582
91
(50 )
(76 )
$ (311,744 )
(120,840 )
179,147
$ 58,307
$ 57,458
(17,674 )
46,400
32,950
(385,697 )
(165,844 )
309,246
134,337
38,568
33,452
(4,257 )
296,416
39,595
(2,125 )
$ 258,489
$ 184,228
(366,503 )
126,587
(294,715 )
(9,985 )
(4,269 )
825
527
116,000
60
(193 )
$ (247,438 )
28,661
150,486
$ 179,147
(100,988 )
(29,058 )
60,335
139,825
17,042
(261 )
(706 )
6,934
(250,621 )
10,775
(4,181 )
$ (140,188 )
$
74,992
144,328
961,074
(1,048,161 )
(16,775 )
773
1,021
1,633
125
156
(2,188 )
$ 116,978
15,803
134,683
$ 150,486
$ 80,226
3,184
$
89,570
18,393
42,708
24,647
2010 Annual report 15
2010 Annual report 15
D
e
s
i
g
n
P
r
o
o
f
:
2
/
7
/
1
1
IndIAn A
AdAmS CounTY
decatur downtown
103 east Monroe Street
decatur, in 46733
(260) 724-2157
decatur main
520 north 13th Street
decatur, in 46733
(260) 724-2157
decatur ATm
Adams County
Memorial hospital
1100 Mercer Avenue
decatur, in 46733
Woodcrest
1300 Mercer Avenue
decatur, in 46733
(260) 724-2157
BRoWn CounTY
nashville
189 Commercial drive
nashville, in 47448
(812) 988-1200
CARRoLL CounTY
Flora
805 east Columbia Street
Flora, in 46929
(574) 967-4318
CLInTon CounTY
Frankfort
1900 east wabash Street
Frankfort, in 46041
(765) 654-8742
Frankfort downtown
60 South Main Street
Frankfort, in 46041
(765) 654-8533
dELAWARE CounTY
Albany
937 west walnut Street
Albany, in 47320
(765) 789-4426
i
S
n
o
T
A
C
o
l
daleville
14500 west davis drive
daleville, in 47334
(765) 378-7077
daleville ATm
9301 South innovation drive
daleville, in 47334
East Jackson
101 South Country Club road
Muncie, in 47303
(765) 747-1332
Eaton
107 east harris Street
eaton, in 47338
(765) 396-3311
Eaton ATm
Marathon vP
17000 north State road 3
eaton, in 47338
madison
2101 South Madison Street
Muncie, in 47302
(765) 747-1541
muncie main
200 east Jackson Street
Muncie, in 47305
(765) 747-1500
northwest
1628 west McGalliard road
Muncie, in 47304
(765) 747-1552
Southway
3700 South Madison Street
Muncie, in 47302
(765) 747-1574
Tillotson
801 South Tillotson Avenue
Muncie, in 47304
(765) 747-1335
village
1701 west university Avenue
Muncie, in 47303
(765) 747-1592
Westminster village
5801 west Bethel Avenue
Muncie, in 47304
(765) 378-8760
Yorktown
1501 north nebo road
Muncie, in 47304
(765) 747-4910
First merchants Insurance Group
302 east Jackson Street
Muncie, in 47307
(765) 213-3400
FAYETTE CounTY
Connersville 9th Street
832 north Central Avenue
Connersville, in 47331
(765) 827-0811
Connersville north
3030 western Avenue
Connersville, in 47331
(765) 827-9846
HAmILTon CounTY
Carmel
one east Carmel drive
Suite 100
Carmel, in 46032
(317) 844-5675
Fishers
12514 east 116th Street
Fishers, in 46037
(317) 913-9020
Indianapolis
10333 north Meridian Street
Suite 350
indianapolis, in 46290
(317) 844-2980
noblesville
17833 Foundation drive
noblesville, in 46060
(317) 770-7570
Westfield
3002 State road 32 east
Westfield, IN 46074
(317) 867-5488
HEndRICkS CounTY
Avon
7648 east u.S. highway 36
Avon, in 46123
(317) 272-0467
Brownsburg
975 east Main Street
Brownsburg, in 46112
(317) 852-3134
Plainfield
1121 east Main Street
Plainfield, IN 46168
(317) 837-3640
HEnRY CounTY
middletown
790 west Mill Street
Middletown, in 47356
(765) 354-2291
mooreland
110 South Broad Street
Mooreland, in 47360
(765) 766-5375
Sulphur Springs
105 east Main Street
Sulphur Springs, in 47388
(765) 533-4171
HoWARd CounTY
kokomo
1306 east Gano Street
kokomo, in 46901
(765) 236-0730
JAPSER CounTY
demotte
437 north halleck Street
demotte, in 46310
(219) 987-5812
Remington
101 east division Street
remington, in 47977
(219) 261-2161
Rensselaer
200 west washington Street
rensselaer, in 47978
(219) 866-7121
16 First Merchants Corporation
Rensselaer ATm
St. Joseph College
halleck Center
910 west Schaefer Circle
rensselaer, in 47978
JAY CounTY
Portland main
112 west Main Street
Portland, in 47371
(260) 726-7158
Portland Supercenter
218 west lincoln Street
Portland, in 47371
(260) 726-7158
JoHnSon CounTY
Franklin
2259 north Morton Street
Franklin, in 46131
(317) 346-7474
Emerson
1250 north emerson Avenue
Greenwood, in 46143
(317) 881-1414
Greenwood mall
1275 u.S. highway 31 north
Greenwood, in 46142
(317) 884-1045
Greenwood – State Road 135
996 South State road 135
Greenwood, in 46143
(317) 882-4790
Worthsville Road
18 Providence drive
Greenwood, in 46143
(317) 883-3559
Trafalgar
110 north State road 135
Trafalgar, in 46181
(317) 878-4111
Treybourne
648 Treybourne drive
Greenwood, in 46142
(317) 883-8811
mAdISon CounTY
Anderson main
33 west 10th Street
Anderson, in 46016
(765) 622-9773
university
1933 university Blvd.
Anderson, in 46012
(765) 640-4973
53rd Street
1526 east 53rd Street
Anderson, in 46013
(765) 648-4950
nichol
2825 nichol Avenue
Anderson, in 46011
(765)640-4981
Anderson ATm
Anderson university
1100 east 5th Street
Anderson, in 46012
Hartman
416 east hartman road
Anderson, in 46012
(765) 608-3336
Heritage
3055 u.S. highway 36 west
Pendleton, in 46064
(765) 778-9793
Ingalls ATm
227 north Swain Street
ingalls, in 46048
Lapel
1011 north Main Street
lapel, in 46051
(765) 534-3181
Pendleton
100 east State Street
Pendleton, in 46064
(765) 778-2132
First merchants Insurance Group
915 Jackson Street
Anderson, in 46016
(765)644-7818
First merchants Insurance Group
117 north Pendleton Avenue
Pendleton, in 46064
(765) 778-2525
mIAmI CounTY
maconaquah
990 west Main Street
Peru, in 46970
(765) 472-4363
miami
855 north Broadway
Peru, in 46970
(765) 472-0253
montgomery office
Crawfordsville
134 South washington Street
Crawfordsville, in 47933
(765) 362-0200
moRGAn CounTY
mooresville
1010 north old State road 67
Mooresville, in 46158
(317) 834-4100
morgantown
180 west washington Street
Morgantown, in 46160
(812) 597-4425
RAndoLPH CounTY
union City
450 west Chestnut Street
union City, in 47390
(765) 964-3702
Winchester
122 west washington Street
winchester, in 47394
(765) 584-2501
First merchants Insurance Group
207 north Columbia
union City, in 47390
(765) 964-3116
First merchants Insurance Group
107 South Main Street
winchester, in 47394
(765) 584-1121
TIPPECAnoE CounTY
26 East
3901 State road 26 east
lafayette, in 47905
(765) 423-7167
Attica ATm
Supertest
301 South Brady Street
Attica, in 47918
Elston
2862 u.S. highway 231 South
lafayette, in 47909
(765) 423-7166
Lafayette Station
2504 Teal road
lafayette, in 47905
(765) 423-7164
Lafayette main
250 Main Street
lafayette, in 47901
(765) 423-7100
Lafayette – 350 South ATm
Supertest
1803 east 350 South
lafayette, in 47909
Lafayette ATm
Supertest
1309 Sagamore Parkway South
lafayette, in 47905
market Square
2200 elmwood Avenue
lafayette, in 47904
(765) 423-7163
Purdue ATm
Purdue university
Memorial union
101 north Grant Street
west lafayette, in 47906
Tippecanoe Court
2513 Maple Point drive
lafayette, in 47905
(765) 423-3821
valley Lakes
1803 east 350 South
lafayette, in 47909
(765) 423-3841
West Lafayette
2329 north Salisbury Street
west lafayette, in 47906
(765) 423-7162
West Lafayette ATm
JB Battlefield
5851 State road 43 north
west lafayette, in 47906
unIon CounTY
Liberty
107 west union Street
liberty, in 47353
(765) 458-5131
WABASH CounTY
Chippewa
1250 north Cass Street
wabash, in 46992
(260) 563-4116
meshingomesia
901 State road 114 west
north Manchester, in 46962
(260) 982-7504
Wabash downtown
189 west Market Street
wabash, in 46992
(260) 563-4116
WAYnE CounTY
Richmond – Chester Blvd
2206 Chester Blvd.
richmond, in 47374
(765) 935-4505
Richmond – Glen miller
1 Glen Miller Parkway
richmond, in 47374
(765) 962-8150
White County
Brookston
103 north Prairie Street
Brookston, in 47923
(765) 563-6400
monticello main
116 east washington Street
Monticello, in 47960
(574) 583-4666
monticello Walmart
1088 west Broadway Street
Monticello, in 47960
(574) 583-3078
Reynolds
105 east 2nd Street
reynolds, in 47980
(219) 984-5471
oHIo
BuTLER CounTY
oxford
4 north College Avenue
oxford, oh 45056
(513) 524-8301
FRAnkLIn CounTY
Columbus main
3650 olentangy river road
Suite 100
Columbus, oh 43214
(614) 583-2200
HAmILTon CounTY
Cincinnati
8170 Corporate Park drive
Suite 240
Cincinnati, oh 45242
(513) 794-7450
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2010 Annual report
2010 Annual report 17
CoRP oRATE
InFoRmATIon
Corporate Headquarters
200 east Jackson Street
P. o. Box 792
Muncie, in 47305-2814
(765) 747-1500
Ticker Symbol
nASdAq: FrMe
Transfer Agent and Registrar
American Stock Transfer & Trust Co.
6201 15th Ave
Brooklyn, nY 11219
(800) 937-5449
Form 10-k and Proxy Statement
A copy of the company’s Form 10-k and Proxy
Statement will be sent to shareholders upon written
request to Mark k. hardwick, executive vice President
and Chief Financial Officer
Website
www.firstmerchants.com
Investor Relations Contact
david l. ortega
(765) 378-8937 or (800) 262-4261, ext. 28937
dortega@firstmerchants.com
Independent Registered Public Accounting Firm
Bkd, llP
indianapolis, in
Annual meeting
Tuesday, May 3, 2011 at the horizon Convention
Center, 401 South high Street, Muncie, in 47305
at 3:30 p.m., local time.
Summary Annual Report
This report is in a summary format. it is intended to
present 2010 results in a simple, readable style. The
more detailed oper ational and financial material is
part of the Annual report on Form 10-k.
BoARd oF dIRECT oRS And ExECuTIvE oFFICERS
BoARd
Charles E. Schalliol
Chairman
Baker and daniels llP
of Counsel
michael C. Rechin
First Merchants Corporation
President and Chief Executive Officer
Thomas B. Clark
Jarden Corporation
Chairman of the Board, President
and Chief Executive Officer (retired)
Jerry R. Engle
First Merchants Bank, n.A.
Senior vice President and
Community leader
Roderick English
The James Monroe Group, llC
President and Chief Executive Officer
dr. Jo Ann m. Gora
Ball State university
President
William L. Hoy
Columbus Sign Company
Chief Executive Officer and Co-Owner
Barry J. Hudson
First national Bank of Portland
Chairman of the Board (retired)
Patrick A. Sherman
Sherman & Armbruster, llP
Partner and CPA
Terry L. Walker
Muncie Power Products, inc.
Chairman of the Board and
Chief Executive Officer
Jean L. Wojtowicz
Cambridge Capital
Management Corporation
President and Chief Executive Officer
mAnAGEmEnT
michael C. Rechin
President and Chief Executive Officer
mark k. Hardwick
executive vice President
and Chief Financial Officer
michael J. Stewart
executive vice President
and Chief Banking Officer
Jami L. Bradshaw
Senior vice President and
Chief Accounting Officer
Robert R. Connors
Senior vice President, operations
and Technology
kimberly J. Ellington
Senior vice President and
director of human resources
Jeffrey B. Lorentson
Senior vice President
and Chief Risk Officer
John J. martin
Senior vice President
and Chief Credit Officer
ouR vISIon
A community bank focused on building deep, lifelong client relationships and providing maximum
shareholder value. We provide an experience where customers can bank with their neighbors, realizing
that our business begins and ends with people.
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18 First Merchants Corporation
200 East Jackson Street
P.o. Box 792
muncie, In 47305
(765) 747-1500
www.firstmerchants.com