Slide 1: Investor Update Second Quarter 2025
INVESTOR UPDATE Second Quarter 2025
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements can often, but not always, be identified by the use of words like “believe”, “continue
Slide 3: Executive Management Team
Executive Management Team Mark Hardwick FMB: Chief Executive Officer 27 Yrs Mark K. Hardwick currently serves as the Chief Executive Officer of First Merchants Corporation and First Merchants Bank. Mark joined First Merchants in November of 1997 as Corporate Controller and was promoted to Chief Fina
Slide 4: First Merchants Corporation (NASDAQ: FRME)
First Merchants Corporation (NASDAQ: FRME) Largest financial services holding company headquartered in Central Indiana Financial Highlights as of 6/30/2025 $18.6 Billion YTD ROAA: 1.22% Total Assets YTD Return on TCE 14.30% $13.3 Billion TCE/TA: 8.92% Total Loans Market Cap $2.2B $14.8 Billion Divid
Slide 5: Highlights
Highlights Second Quarter Net Income & EPS1 ROA (Annualized) ROE & ROTCE (Annualized) $56.4 Million 1.23% ROA 9.63% ROE $0.98 Per Share 1.53% PTPP ROA2 14.49% ROTCE2 ▪ EPS of $0.981 compared to EPS of $0.681 in 2Q24; ▪ Strong loan growth of $297.6 million, or 9.1% annualized an increase of 44.1% ▪ R
Slide 6: Business Strategy
Business Strategy Commercial Banking Consumer Banking Full Spectrum of Debt Capital and Treasury Service Offerings Full Spectrum of Consumer Deposit and Lending Offerings Located in Prime Growth Markets Supported by: Talented, Customer Service Oriented Banking Center Small Business & SBA Asset Based
Slide 7: Business Highlights - Loans
Business Highlights - Loans Michigan Loan Growth Summary1,2 Monroe MSA Rank: 1 Detroit MSA Rank: 9 2Q25 Balance ($B) Growth Deposits: $2.5B Loans: $2.9B Commercial 10.1 10.7% Northwest Indiana Lake County Rank: 4 Consumer 3.2 4.4% Lafayette MSA Rank: 2 Total Loan Growth QTD 9.1% Deposits: $2.9B Loan
Slide 8: Business Highlights - Deposits
Business Highlights - Deposits Michigan Monroe MSA Rank: 1 Deposit Growth Summary1,2 Detroit MSA Rank: 9 Deposits: $2.5B 2Q25 Balance ($B) Growth Northwest Indiana Loans: $2.9B Lake County Rank: 4 Commercial 7.4 19.5% Lafayette MSA Rank: 2 Consumer 5.7 -7.4% Deposits: $2.9B Total Deposit Growth QTD
Slide 9: Second Quarter Financial Results
Second Quarter Financial Results ($M except per share data) For the Three Months Ended, Variance % Variance Linked Linked QTR- 6/30/24 9/30/24 12/31/24 3/31/25 6/30/25 Quarter Annualized Balance Sheet & Asset Quality 2Q25 Highlights 1. Total Assets $18,303.4 $18,347.6 $18,312.0 $18,439.8 $18,592.8 $
Slide 10: Year to Date Financial Results
Year to Date Financial Results ($M except per share data) For the Six Months Ended June 30, Variance % Variance 2023 2024 2025 YOY YOY Balance Sheet & Asset Quality Year to Date Highlights 1. Total Assets $18,032.3 $18,303.4 $18,592.8 $289.4 1.6% 2. Total Loans 12,297.5 12,671.9 13,325.5 653.6 5.2%
Slide 11: Investment Portfolio Highlights
Investment Portfolio Highlights 2Q25 Investment Portfolio Composition Yield on Investments (%) / Total Investments ($B) Corporate Obligations U.S. Agencies 2% 12% Collateralized Mortgage Obligations 2.61% 2.63% 2.67% 2.63% 2.64% 5% $3.4B Municipal $3.8 $3.7 $3.5 $3.4 $3.4 Mortgage- Total Bonds 56% B
Slide 12: Loan Portfolio Highlights
Loan Portfolio Highlights 2Q25 Loan Composition Highlights Construction Land & Land Development 6.3% Agricultural Land & Commercial Real Estate Production 2.0% ▪ Portfolio composition is ~75% Commercial oriented Non-Owner Occupied Public Finance/Other 16.3% Commercial 8.6% ▪ Total loan yield of 6.32
Slide 13: Allowance for Credit Losses - Loans
Allowance for Credit Losses - Loans 2Q25 Allowance for Credit Losses - Loans Highlights ▪ $5.6 million Q2 provision ▪ The reserve for unfunded commitments totals $18.0 million 1.50% 1.48% 1.50% 1.47% 1.47% and is recorded in Other Liabilities ▪ The remaining fair value accretion on acquired loans is
Slide 14: Deposit Portfolio Highlights
Deposit Portfolio Highlights 2Q25 Deposit Composition Highlights Certificates & Time ▪ Strong core deposit base Brokered Certificates of Deposits 1 Deposits < $100k 3% • 91% core deposits2 4% Certificates & Time • 15% noninterest bearing Deposits > $100k 6% • 34% of total deposits yield 0 to 5 bps ▪
Slide 15: Net Interest Margin
Net Interest Margin 2Q24 3Q24 4Q24 1Q25 2Q25 1. Net Interest Income - FTE ($millions) $ 134.4 $ 137.0 $ 140.2 $ 136.4 $ 139.2 2. Fair Value Accretion $ 1.5 $ 1.4 $ 1.4 $ 1.1 $ 1.0 3. Adjusted Net Interest Income - FTE1 $ 132.9 $ 135.6 $ 138.8 $ 135.3 $ 138.2 4. Tax Equivalent Yield on Earning Assets
Slide 16: Noninterest Income Highlights
Noninterest Income Highlights 2Q25 Noninterest Income Detail ($M) Noninterest Income Trends Fee Income / Revenue 23.4% Service Charges $8.6 18.9% 27% 18.0% 18.4% 15.4% Gain on Card Sale of Loans Payment Fees $5.9 $31.3M $4.9 Customer-Related Fees ($M) 19% 16% Total Derivative Hedge Fees $29.8 $29.4
Slide 17: Noninterest Expense Highlights
Noninterest Expense Highlights 2Q25 Noninterest Expense Detail Noninterest Expense Trends ($M) Efficiency Ratio Net Occupancy & Outside Data Processing Equipment $7.1 $13.8 7% 53.84% 53.76% 54.54% 53.99% 53.60%1 15% Professional & Other Outside Services $3.7 48.48% $93.6M 4% Intangible Asset Amortiz
Slide 18: Capital Ratios
Capital Ratios Tangible Common Equity Ratio Highlights 8.76% 8.81% 8.90% 8.92% ▪ Capital ratios reflect $30 million of sub debt 8.27% redemption and $30 million of shares repurchased 9.57% YTD; $22.1 million of shares repurchased in 2Q25 9.31% 9.31% 9.65% 9.04% 9.31% 9.31% 9.57% 9.65% 9.57% 2Q24 3Q2
Slide 19: Loan Portfolio
Loan Portfolio Loan Portfolio Trends ($M) 2Q25 Highlights 2Q24 3Q24 4Q24 1Q25 2Q25 ▪ Balanced Commercial loan growth of $262 million 1. C&I - Regional Banking $ 3,132 $ 3,201 $ 3,349 $ 3,482 $ 3,574 ▪ Strong C&I Loan growth of $147 million 2. C&I - Sponsor Finance 818 841 766 824 867 ▪ Conservative
Slide 20: Loan Portfolio Insights
Loan Portfolio Insights Commercial C&I C&I - Sponsor Finance ▪ $867.4 million in loans to 95 companies in a diversity of industries ▪ Senior Debt/Adj. EBITDA < 3.0X ~79% ▪ Total Debt/Adj. EBITDA < 4.0X ~78% ▪ FCCR > 1.50X ~70% ▪ ~5.9% Classified (as a % of portfolio) ▪ Excellent credit history with
Slide 21: Loan Portfolio Insights (continued)
Loan Portfolio Insights (continued) Commercial Real Estate (Non-Owner Occupied) ($M) Multi- Warehouse Total CRE Family Industrial Retail / Storage Office Other (NOO) Balance: $ 641.4 $ 397.7 $ 311.2 $ 280.3 $ 237.2 $ 303.3 $ 2,171.1 Commitment: $ 673.0 $ 414.1 $ 315.0 $ 291.3 $ 240.8 $ 375.5 $ 2,309
Slide 22: Asset Quality
Asset Quality Asset Quality Trends ($M) 2Q25 Highlights 2Q24 3Q24 4Q24 1Q25 2Q25 Asset Quality: 1. Non-Accrual Loans $ 61.9 $ 59.1 $ 73.8 $ 81.9 $ 67.4 ▪ Largest Non-Accruals: 2. Other Real Estate 4.8 5.2 4.9 5.0 0.2 • $12.9 million – Multi-family Construction 3. 90PD Loans 1.7 14.1 5.9 4.3 4.4 4. N
Slide 23: Nonperforming Assets
Nonperforming Assets Nonperforming Assets Roll Forward ($M) 2Q25 Highlights 2Q24 3Q24 4Q24 1Q25 2Q25 Non-Accrual Migration: 1. Beginning Balance NPAs + 90PD $ 70.2 $ 68.4 $ 78.4 $ 84.6 $ 91.2 ▪ Payoff of $22 million non-accrual construction loan Non-Accrual originally placed on non-accrual in 4Q24 2
Slide 24: Track Record of Shareholder Value
Track Record of Shareholder Value 10-Year Total Return (2014-2024) Earnings per Share CAGR 2014-2024: 7.5% $3.81 $3.81 $3.73 230.1% $3.41 $3.22 $3.19 $2.74 $1.98 $2.12 $1.92 $1.65 $1.72 200.3% 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 YTD'25 Dividends per Share FRME KBW NASDAQ Regional
Slide 25: History of Organic and Whole Bank Acquisition Growth
History of Organic and Whole Bank Acquisition Growth Total Assets ($B) Growth Through Acquisition ✓ Experienced Acquirer ✓ Expanded in Current High-Growth Markets ✓ Added to Franchise with Stable Deposit Gathering Markets $18.3 $18.3 $18.6 $17.9 $15.5 $14.1 $12.5 $9.9 $9.4 $6.8 $7.2 $5.8 2014 2015 2
Slide 26: Vision for the Future
Vision for the Future Our Vision: To enhance the financial wellness of the diverse communities we serve. Our Mission: To be the most attentive, knowledgeable, and high-performing bank for our clients, teammates, and shareholders. Strategic ▪ Drive engagement through inclusivity, teamwork, performanc
Slide 27: Appendix
APPENDIX ss 00) First Merchants Corporation Helping you prosper
Slide 28: Non-GAAP
Non-GAAP ADJUSTED NET INCOME AND DILUTED EARNINGS PER COMMON SHARE 2Q24 3Q24 4Q24 1Q25 2Q25 6/30/23 YTD 6/30/24 YTD 6/30/25 YTD (Dollars and Shares Outstanding in Thousands, Except Per Share Amounts) Net Income Available to Common Stockholders - GAAP $ 39,456 $ 48,719 $ 63,880 $ 54,870 $ 56,363 $ 12
Slide 29: Non-GAAP
Non-GAAP PRE-TAX, PRE-PROVISION ("PTPP") EARNINGS, AS ADJUSTED 2Q24 3Q24 4Q24 1Q25 2Q25 6/30/23 YTD 6/30/24 YTD 6/30/25 YTD (Dollars in Thousands, Except Per Share Amounts) Net Interest Income (GAAP) $ 128,571 $ 131,110 $ 134,370 $ 130,270 $ 133,014 $ 281,954 $ 255,634 $ 263,284 Other Income (GAAP)
Slide 30: Non-GAAP
Non-GAAP NET INTEREST MARGIN ("NIM"), ADJUSTED 2Q24 3Q24 4Q24 1Q25 2Q25 6/30/23 YTD 6/30/24 YTD 6/30/25 YTD (Dollars in Thousands) Net Interest Income (GAAP) $ 128,571 $ 131,110 $ 134,370 $ 130,270 $ 133,014 $ 281,954 $ 255,634 $ 263,284 Fully Taxable Equivalent ("FTE") Adjustment 5,859 5,883 5,788
Slide 31: Non-GAAP
Non-GAAP EFFICIENCY RATIO (dollars in thousands): 2Q24 3Q24 4Q24 1Q25 2Q25 6/30/23 YTD 6/30/24 YTD 6/30/25 YTD EFFICIENCY RATIO (dollars in thousands): Noninterest Expense (GAAP) $ 91,413 $ 94,629 $ 96,289 $ 92,902 $ 93,598 $ 186,313 $ 188,348 186,500 Less: Intangible Asset Amortization (1,771) (1,7
Slide 32: Non-GAAP
Non-GAAP CAPITAL RATIOS (dollars in thousands): 2Q23 2Q24 3Q24 4Q24 1Q25 2Q25 Total Risk-Based Capital Ratio (dollars in thousands) Total Stockholders' Equity (GAAP) 2,145,565 2,212,525 2,302,373 2,304,983 2,332,214 2,347,952 Adjust for Accumulated Other Comprehensive Loss 1 217,964 211,979 151,825
Slide 33: Non-GAAP
Non-GAAP TANGIBLE COMMON EQUITY RATIO (dollars in thousands): 2Q23 2Q24 3Q24 4Q24 1Q25 2Q25 Tangible Common Equity Ratio (dollars in thousands) Total Stockholders' Equity (GAAP) $ 2,145,565 $ 2,212,525 $ 2,302,373 $ 2,304,983 $ 2,332,214 $ 2,347,952 Less: Preferred Stock (25,125) (25,125) (25,125) (
Slide 34: Non-GAAP
Non-GAAP RETURN ON TANGIBLE COMMON EQUITY (dollars in thousands): 2014 2015 2016 2017 2018 2019 2020 2021 Return on Tangible Common Equity Total Average Stockholders' Equity (GAAP) $ 675,295 $ 753,724 $ 884,664 $ 1,110,524 $ 1,343,861 $ 1,569,615 $ 1,825,135 $ 1,866,632 Less: Average Preferred Stock