Content analysis
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H.S. junior Bad
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New words:
alleged, cast, Comptroller, Currency, distributed, putable
Removed:
annum, bear, NaN, unused
Financial report summary
?Risks
- First Midwest has incurred and expects to incur substantial costs related to the merger with Old National (the "merger") and integration.
- Combining Old National and First Midwest may be more difficult, costly or time-consuming than expected, and First Midwest may fail to realize the anticipated benefits of the merger.
- The combined company may be unable to retain Old National and/or First Midwest personnel successfully after the merger is completed.
- The COVID-19 pandemic may delay and adversely affect the completion of the merger.
- Regulatory approvals may not be received, may take longer than expected, or may impose conditions that are not presently anticipated or that could have an adverse effect on the combined company following the merger.
- Failure to complete the merger could negatively impact First Midwest.
- First Midwest will be subject to business uncertainties and contractual restrictions while the merger is pending.
- Shareholder litigation related to the merger could prevent or delay the completion of the merger, result in the payment of damages or otherwise negatively impact the business and operations of First Midwest.
- The merger agreement may be terminated in accordance with its terms and the merger may not be completed.
- Because the market price of Old National common stock may fluctuate, First Midwest stockholders cannot be certain of the market value of the merger consideration they will receive.
Management Discussion
- Net interest income was $579.6 million for 2020 compared to $588.5 million for 2019, a decrease of 1.5%. The decrease in net interest income resulted primarily from lower market rates on loans and securities primarily as a result of the pandemic and lower acquired loan accretion, partially offset by growth in loans and securities, the acquisition of interest-earning assets from the Park Bank transaction in March 2020, interest income and fees on PPP loans, and lower cost of funds.
- Acquired loan accretion contributed $29.5 million and $35.6 million to net interest income for 2020 and 2019, respectively.
- Tax-equivalent net interest margin was 3.18% for 2020, down 72 basis points from 2019. Excluding the impact of acquired loan accretion, tax-equivalent net interest margin was 3.02%, down 65 basis points from 2019. The decrease was driven primarily by lower interest rates on loans and securities primarily as a result of the pandemic, lower yields on PPP loans, as well as a higher balance of other interest-earning assets due to higher demand deposits as a result of PPP loan funds and other government stimuli, partially offset by lower cost of funds.