SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K
Annual Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the fiscal year ended December 31, 1994 Commission file number 0-17071
FIRST MERCHANTS CORPORATION
(Exact name of registrant as specified in its charter)
Indiana 35-1544218
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
200 East Jackson
Muncie, Indiana 47305-2814
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (317) 747-1500
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $.125 stated value per share
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]
The aggregate market value (not necessarily a reliable indication of the
price at which more than a limited number of shares would trade) of the voting
stock held by non-affiliates of the registrant was $93,100,704 as of March 9,
1995.
As of March 9, 1995 there were outstanding 3,367,490 common shares, without
par value, of the registrant.
DOCUMENTS INCORPORATED BY REFERENCE
Part of Form 10-K
Documents Into Which Incorporated
1994 Annual Report to Stockholders Part II (Items 5 through 8)
Definitive Proxy Statement for
Annual Meeting of Shareholders
to be held March 30, 1995 Part III (Items 10 through 13)
EXHIBIT INDEX: Pages 23 Total Pages 112
FORM 10-K TABLE OF CONTENTS
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Page
Part I
Item 1 - Business . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Item 2 - Properties . . . . . . . . . . . . . . . . . . . . . . . . . 16
Item 3 - Legal Proceedings . . . . . . . . . . . . . . . . . . . . . 16
Item 4 - Submission of Matters to a Vote of Security Holders . . . . 16
Supplemental Information - Executive Officers of the Registrant. . . . 17
Part II
Item 5 - Market For the Registrant's Common Equity and
Related Stockholder Matters . . . . . . . . . . . . . . . . 18
Item 6 - Selected Financial Data . . . . . . . . . . . . . . . . . . 18
Item 7 - Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . . . . 18
Item 8 - Financial Statements and Supplementary Data . . . . . . . . 18
Item 9 - Changes In and Disagreements With Accountants on
Accounting and Financial Disclosures . . . . . . . . . . . . 18
Part III
Item 10 - Directors and Executive Officers of the Registrant . . . . 18
Item 11 - Executive Compensation . . . . . . . . . . . . . . . . . . 18
Item 12 - Security Ownership of Certain Beneficial
Owners and Management . . . . . . . . . . . . . . . . . . . 19
Item 13 - Certain Relationships and Related Transactions . . . . . . 19
Part IV
Item 14 - Exhibits, Financial Statement Schedules, and
Reports on Form 8-K . . . . . . . . . . . . . . . . . . . . 19
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Index to Exhibits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Page 2
PART I
ITEM 1. BUSINESS.
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GENERAL
First Merchants Corporation (the "Corporation") was incorporated under Indiana
law on September 20, 1982, as the bank holding company for First Merchants Bank,
National Association ("First Merchants"), a national banking association
incorporated on February 6, 1893. Prior to December 16, 1991, First Merchants'
name was The Merchants National Bank of Muncie. On November 30, 1988, the
Corporation acquired Pendleton Banking Company ("Pendleton"), a state chartered
commercial bank organized in 1872. On July 31, 1991, the Corporation acquired
First United Bank ("First United"), a state chartered commercial bank organized
in 1882.
The Corporation is headquartered in Muncie, Indiana, and is presently engaged in
conducting commercial banking business through the 21 offices of its three
banking subsidiaries. As of December 31, 1994, the Corporation and its
subsidiaries had 372 full-time equivalent employees.
COMPETITION
The Corporation's banking subsidiaries are located in Delaware, Madison, and
Henry counties, Indiana. In addition to the competition provided by the lending
and deposit gathering subsidiaries of national manufacturers, retailers,
insurance companies and investment brokers, the banking subsidiaries compete
vigorously with other banks, thrift institutions, credit unions and finance
companies located within their service areas.
SUPERVISION AND REGULATION
The Corporation is a bank holding company ("BHC") subject to regulation under
the Bank Holding Company Act of 1956, as amended (the "Act"). The Act generally
requires a BHC to obtain prior approval of the Federal Reserve Board (the "FRB")
to acquire or hold more than a 5% voting interest in any bank. The Act
restricts the non-banking activities of BHCs to those which are closely related
to banking activities. As a result of the provisions in the Financial
Institutional Reform, Recovery and Enforcement Act of 1989, BHCs may now own and
operate savings and loan associations or savings banks which, in the past, was
prohibited. First Merchants is a national bank and is supervised, regulated and
examined by the Comptroller of the Currency. Pendleton and First United are
state banks and are supervised, regulated and examined by the Indiana Department
of Financial Institutions. In addition, First Merchants, as a member of the
Federal Reserve System, is supervised and regulated by the Federal Reserve. In
addition, Pendleton and First United, which are not members of the Federal
Reserve System, are supervised and regulated by the Federal Deposit Insurance
Corporation ("FDIC"). The deposits of First Merchants, Pendleton, and First
United (the "Banks") are insured by the FDIC. Each regulator has the authority
to issue cease-and-desist orders if it determines their activities represent an
unsafe and unsound practice or violation of law.
Under the Act and under regulations of the FRB, the Corporation and its
subsidiaries are prohibited from engaging in certain tie-in arrangements in
connection with the extension of credit and are subject to limitations as to
certain intercompany transactions.
Page 3
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SUPERVISION AND REGULATION (CONTINUED)
Subject to certain limitations, an Indiana bank may establish branches de novo
and may establish branches by acquisition in any location or locations within
Indiana. Indiana law permits intrastate bank holding company acquisitions,
subject to certain limitations. Effective July 1, 1992, Indiana bank holding
companies were permitted to acquire banks, and banks and bank holding companies
in Indiana were permitted to be acquired by bank holding companies, located in
any state in the United States which permits reciprocal entry by Indiana bank
holding companies. Prior to July 1, 1992, such interestate bank holding company
acquisitions were permitted only on a regional, as opposed to national, basis.
Neither the Corporation nor its subsidiaries presently contemplate engaging in
any non-banking related business activities.
During 1991, Congress passed the Federal Deposit Insurance Corporation
Improvement Act ("FDICIA"). In addition to addressing the insurance fund's
financial needs, FDICIA expanded the power of the federal banking regulators.
FDICIA introduced a new system of classifying financial institutions with
respect to their capitalization. Effective in 1993, FDICIA also requires
certain financial institutions, such as First Merchants, to have annual audits
and requires management to issue supplemental reports attesting to an
institution's compliance with laws and regulations and to the adequacy of its
internal controls and procedures.
The Corporation is under the jurisdiction of the Securities and Exchange
Commission and state securities commission for matters relating to the offering
and sale of its securities and is subject to the Securities and Exchange
Commission's rules and regulations relating to periodic reporting, reporting to
stockholders, proxy solicitation, and insider trading.
The Corporation's income is principally derived from dividends paid on the
common stock of its subsidiaries. The payment of these dividends are subject to
certain regulatory restrictions.
Page 4
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STATISTICAL DATA
The following tables set forth statistical data relating the Corporation and its
subsidiaries.
DISTRIBUTION OF ASSETS, LIABILITIES AND STOCKHOLDERS' EQUITY;
INTEREST RATES AND INTEREST DIFFERENTIAL
The daily average balance sheet amounts, the related interest income or expense,
and average rates earned or paid are presented in the following table.
1994 1993 1992
---------------------------- ----------------------------- --------------------------
Interest Interest Interest
Average Income/ Average Average Income/ Average Average Income/ Average
Balance Expense Rate Balance Expense Rate Balance Expense Rate
------- ------- ---- ------- ------- ---- ------- ------- ----
(Dollars in Thousands on Fully Taxable Equivalent Basis)
Assets:
Federal funds sold . . . . . . $ 4,808 $ 217 4.5% $ 15,653 $ 454 2.9% $ 13,949 $ 475 3.4%
Interest-bearing time
deposits . . . . . . . . . . 35 2 5.7 648 35 5.4 1,977 124 6.3
Federal Reserve and
Federal Home Loan Bank
stock . . . . . . . . . . . . 1,879 103 5.5 522 29 5.6 307 18 6.0
Securities:
Taxable . . . . . . . . . . . 149,063 8,552 5.7 163,006 10,265 6.3 179,966 13,343 7.4
Tax-exempt. . . . . . . . . . 52,678 3,690 7.0 50,152 3,631 7.2 40,518 3,264 8.1
-------- ------- --------- -------- --------- -------
Total Securities. . . . . . . 201,741 12,242 6.1 213,158 13,896 6.5 220,484 16,607 7.5
Loans:*
Commercial . . . . . . . . . . 156,465 12,861 8.2 148,657 10,919 7.3 136,602 10,790 7.9
Bankers' acceptances and
commercial paper purchased. . 454 22 4.8 112 4 3.6 1,016 38 3.7
Real estate mortgage . . . . . 143,568 11,711 8.2 132,932 11,364 8.5 121,677 11,981 9.8
Installment. . . . . . . . . . 86,824 7,128 8.2 73,226 6,418 8.8 67,559 6,827 10.1
Tax-exempt loans . . . . . . . 1,328 127 9.6 2,101 185 8.8 2,896 235 8.1
-------- ------- --------- -------- ---------- ------
Total loans. . . . . . . . . 388,639 31,849 8.2 357,028 28,890 8.1 329,750 29,871 9.1
-------- ------- --------- -------- ---------- ------
Total earning assets . . . . 597,102 44,413 7.4 587,009 43,304 7.4 566,467 47,095 8.3
------- -------- ------
Net unrealized loss on
securities available for
sale . . . . . . . . . . . . (1,387)
Allowance for loan losses . . . (4,936) (4,584) (4,253)
Cash and due from banks . . . . 23,316 23,373 22,067
Premises and equipment. . . . . 9,318 8,634 7,206
Other assets. . . . . . . . . . 11,455 11,966 11,580
-------- --------- ----------
Total assets. . . . . . . . . $634,868 $626,398 $603,067
-------- --------- ----------
-------- --------- ----------
Liabilities:
Interest-bearing deposits:
NOW accounts. . . . . . . . . $ 85,973 1,786 2.1 $ 79,106 1,811 2.3 $ 70,068 2,189 3.1
Money market deposit
accounts . . . . . . . . . . 105,083 3,101 3.0 111,136 3,112 2.8 104,855 3,795 3.6
Savings deposits. . . . . . . 55,755 1,429 2.6 51,697 1,414 2.7 46,001 1,654 3.6
Certificates and other time
deposits . . . . . . . . . . 195,475 7,978 4.1 206,833 9,094 4.4 220,328 11,675 5.3
-------- ------- -------- ------ --------- ------
Total interest-bearing
deposits . . . . . . . . . . 442,286 14,294 3.2 448,772 15,431 3.4 441,252 19,313 4.4
Short-term borrowings. . . . . 45,639 1,837 4.0 35,317 1,067 3.0 35,796 1,382 3.9
-------- ------- -------- ------ --------- ------
Total interest-bearing
liabilities . . . . . . . . 487,925 16,131 3.3 484,089 16,498 3.4 477,048 20,695 4.3
Noninterest-bearing
deposits . . . . . . . . . . 71,743 69,054 60,274
Other liabilities. . . . . . . 5,096 6,368 4,499
-------- -------- ---------
Total liabilities . . . . . . 564,764 559,511 541,821
Stockholders' equity . . . . . . 70,104 66,887 61,246
-------- -------- ---------
Total liabilities and
stockholders' equity . . . . $634,868 16,131 2.7** $626,398 16,498 2.8** $603,067 20,695 3.7**
-------- -------- ---------- -------- --------- -------
-------- ---------- ---------
Net interest income. . . . . . $28,282 4.7 $26,806 4.6 $26,400 4.7
-------- -------- -------
-------- -------- -------
<FN>
-------------
*Nonaccruing loans have been
included in the average
balances.
**Total interest expense
divided by total earning
assets
Adjustment to convert tax exempt
investment securities to fully
taxable equivalent basis, using
marginal rate of 34%. . . . . . $ 1,299 $ 1,298 $ 1,190
--------- ---------- ---------
--------- ---------- ---------
Page 5
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STATISTICAL DATA (Continued)
ANALYSIS OF CHANGES IN NET INTEREST INCOME
The following table presents net interest income components on a tax-equivalent
basis and reflects changes between periods attributable to movement in either
the average balance or average interest rate for both earning assets and
interest-bearing liabilities. The volume differences were computed as the
difference in volume between the current and prior year times the interest rate
of the prior year, while the interest rate changes were computed as the
difference in rate between the current and prior year times the volume of the
prior year. Volume/rate variances have been allocated on the basis of the
absolute relationship between volume variances and rate variances.
1994 Compared to 1993 1993 Compared to 1992
Increase (Decrease) Due To Increase (Decrease) Due To
-------------------------- ----------------------------
Volume Rate Total Volume Rate Total
------ ---- ----- ------ ---- -----
(Dollars in Thousands on Fully Taxable Equivalent Basis)
Interest income:
Federal funds sold. . . . . . . . . . . . $ (411) $ 174 $ (237) $ 54 $ (75) $ (21)
Interest-bearing time
deposits. . . . . . . . . . . . . . . . . (35) 2 (33) (73) (16) (89)
Federal Reserve and Federal
Home Loan Bank stock . . . . . . . . . . 75 (1) 74 12 (1) 11
Scurities . . . . . . . . . . . . . . . . (769) (885) (1,654) (540) (2,171) (2,711)
Loans . . . . . . . . . . . . . . . . . . 2,597 362 2,959 2,411 (3,392) (981)
--------- ------- -------- --------- -------- --------
Totals . . . . . . . . . . . . . . . . . . 1,457 (348) 1,109 1,864 (5,655) (3,791)
--------- ------- -------- --------- -------- --------
Interest expense:
NOW accounts. . . . . . . . . . . . . . . 145 (170) (25) 248 (626) (378)
Money market deposit
accounts . . . . . . . . . . . . . . . (197) 186 (11) 211 (894) (683)
Savings deposits. . . . . . . . . . . . . 81 (66) 15 195 (435) (240)
Certificates and other
time deposits. . . . . . . . . . . . . . (498) (618) (1,116) (684) (1,897) (2,581)
Short-term borrowings . . . . . . . . . . 360 410 770 (18) (297) (315)
---------- -------- --------- ---------- --------- ----------
Totals . . . . . . . . . .. . . . . . . (109) (258) (367) (48) (4,149) (4,197)
---------- -------- --------- ---------- --------- ----------
Change in net interest
income (fully taxable
equivalent basis) . . . . . . . . . . . . $1,566 $ (90) 1,476 $1,912 $(1,506) 406
----------- -------- ---------- ----------
----------- -------- ---------- ----------
Tax equivalent adjustment
using marginal rate
of 34%. . . . . . . . . . . . . . . . . . (1) (108)
---------- -----------
Change in net interest
income. . . . . . . . . . . . . . . . . . $1,475 $ 298
---------- -----------
---------- -----------
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Page 6
STATISTICAL DATA (Continued)
INVESTMENT PORTFOLIO
The amortized cost, gross unrealized gains, gross unrealized losses and
approximate market value of the investment securities portfolio at the dates
indicated were:
Gross Gross
Amortized Unrealized Unrealized Fair
Cost Gains Losses Value
--------- ---------- ---------- ---------
(Dollars in Thousands)
Securities available for sale at
December 31, 1994:
U.S. Treasury. . . . . . . . . . . . . . . . $ 11,817 $ 550 $ 11,267
Federal agencies . . . . . . . . . . . . . . 35,565 1,271 34,294
State and municipal. . . . . . . . . . . . . 9,762 $ 31 385 9,408
Mortgage and other
asset-backed securities. . . . . . . . . . 22,171 29 836 21,364
Corporate obligations. . . . . . . . . . . . 24,221 4 1,195 23,030
---------- --------- --------- ----------
Total. . . . . . . . . . . . . . . . . . $ 103,536 $ 64 $ 4,237 $ 99,363
---------- --------- --------- ----------
---------- --------- --------- ----------
Securities held to maturity at
December 31, 1994:
U.S. Treasury. . . . . . . . . . . . . . . . $ 12,630 $ 21 $ 222 $ 12,429
Federal agencies . . . . . . . . . . . . . . 24,529 29 469 24,089
State and municipal. . . . . . . . . . . . . 38,117 211 680 37,648
Mortgage and other
asset-backed securities. . . . . . . . . . 370 370
Corporate obligations. . . . . . . . . . . . 2,031 45 1,986
---------- --------- --------- ----------
Total. . . . . . . . . . . . . . . . . . $ 77,677 $ 261 $ 1,416 $ 76,522
---------- --------- --------- ----------
---------- --------- --------- ----------
Securities held to maturity at
December 31, 1993:
U.S. Treasury. . . . . . . . . . . . . . . . $ 45,397 $ 654 $ 1 $ 46,050
Federal agencies . . . . . . . . . . . . . . 53,452 691 62 54,081
State and municipal. . . . . . . . . . . . . 44,866 1,211 55 46,022
Mortgage and other
asset-backed securities. . . . . . . . . . 23,690 219 93 23,816
Corporate obligations. . . . . . . . . . . . 36,958 582 87 37,453
---------- --------- --------- ----------
Total. . . . . . . . . . . . . . . . . . $ 204,363 $ 3,357 $ 298 $ 207,422
---------- --------- --------- ----------
---------- --------- --------- ----------
Securities held to maturity at
December 31, 1992:
U.S. Treasury. . . . . . . . . . . . . . . . $ 53,120 $ 1,348 $ 105 $ 54,363
Federal agencies . . . . . . . . . . . . . . 66,778 1,544 85 68,237
State and municipal. . . . . . . . . . . . . 33,203 911 76 34,038
Mortgage and other
asset-backed securities. . . . . . . . . . 16,073 508 2 16,579
Corporate obligations. . . . . . . . . . . . 26,804 710 36 27,478
---------- --------- --------- ----------
Total. . . . . . . . . . . . . . . . . . $ 195,978 $ 5,021 $ 304 $ 200,695
---------- --------- --------- ----------
---------- --------- --------- ----------
Page 7
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STATISTICAL DATA (Continued)
Cost
-----------------------------
1994 1993 1992
---- ---- ----
Federal Reserve and Federal Home Loan
Bank Stock at December 31:
Federal Reserve Bank Stock . . . . .$ 307 $ 307 $ 307
Federal Home Loan Bank Stock . . . . 1,572 1,572
--------- --------- ---------
Total. . . . . . . . . . . . . .$ 1,879 $ 1,879 $ 307
--------- --------- ---------
--------- --------- ---------
The Fair Value of Federal Reserve and Federal Home Loan Bank stock approximates
cost.
The maturity distribution (dollars in thousands) and average yields for the
securities portfolio at December 31, 1994 were:
Securities available for sale December 31, 1994:
Mortgage and other
Within 1 Year 1-5 Years 5 - 10 Years asset-backed Total
------------- --------- ------------ ------------ -----
Amount Yield* Amount Yield* Amount Yield* Amount Yield* Amount Yield*
------ ------ ------ ------ ------- ------ ------- ------ ------- ------
U.S. Treasury . . . . . $11,267 5.30% $ 11,267 5.30%
Federal Agencies. . . . $ 9,050 5.86% 25,244 5.76 34,294 5.79
State and Muncipal. . . 6,034 6.82 $ 3,374 7.35% 9,408 7.01
Corporate Obligations . 3,512 7.47 19,518 5.40 23,030 5.70
Mortgage and other
asset-backed. . . . . $ 21,364 5.80% 21,364 5.80
-------- ------- -------- -------- --------
Total . . . . . . . $ 12,562 6.30 $62,063 5.66 $ 3,374 7.35 $ 21,364 5.80 $ 99,363 5.83
-------- ------- -------- -------- --------
-------- ------- -------- -------- --------
Securities held to maturity at December 31, 1994:
Mortgage and other
Within 1 Year 1 - 5 Years 5 - 10 Years asset-backed Total
------------- ----------- ------------ ------------ -----
Amount Yield* Amount Yield* Amount Yield* Amount Yield* Amount Yield*
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
U.S. Treasury. . . . . $ 7,508 6.75% $ 5,122 5.63% $ 12,630 6.29%
Federal Agencies . . . 16,681 6.20 7,848 5.45 24,529 5.96
State and Municipal. . 7,323 7.10 27,323 7.07 $ 3,471 7.90% 38,117 7.15
Corporate Obligations. 1,530 4.21 501 4.48 2,031 4.28
Mortgage and other
asset-backed . . . . $ 370 6.74% 370 6.74
-------- -------- -------- -------- --------
Total. . . . . . . . $ 33,042 6.44% $ 40,794 6.54% $ 3,471 7.90 $ 370 6.74 $ 77,677 6.56
-------- -------- -------- -------- --------
-------- -------- -------- -------- --------
<FN>
*Interest yields on state and municipal securities are presented on a fully
taxable equivalent basis using a 34% rate.
Federal Reserve and Federal Home Loan Bank Stock at December 31, 1994:
Amount Yield
------ -----
Federal Reserve Bank Stock . . . . . . . . 307 6.00%
Federal Home Loan Bank Stock . . . . . . . 1,572 5.50
-------
Total. . . . . . . . . . . . . . . . . . $ 1,879 5.58
-------
-------
Page 8
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STATISTICAL DATA (Continued)
LOAN PORTFOLIO
TYPES OF LOANS
The loan portfolio at the dates indicated is presented below:
1994 1993 1992 1991 1990
---- ---- ---- ---- ----
(Dollars in Thousands)
Loans at December 31:
Commercial and
industrial loans . . . . . . . . . . $ 78,943 $ 76,760 $ 70,959 $ 76,245 $ 70,254
Bankers acceptances and loans
to financial institutions. . . . . . 3,000 9,496 2,092 9,927
Agricultural production
financing and other loans
to farmers . . . . . . . . . . . . . 5,310 5,591 6,240 6,887 5,449
Real estate loans:
Construction . . . . . . . . . . . . 8,126 8,127 2,619 3,191 3,512
Commercial and farmland. . . . . . . 64,110 58,235 52,402 51,323 41,789
Residential. . . . . . . . . . . . . 164,760 150,572 140,526 120,281 101,993
Individuals' loans for
household and other
personal expenditures. . . . . . . . 78,041 70,347 60,625 58,000 47,897
Tax-exempt loans . . . . . . . . . . . 1,204 1,474 2,402 2,309 2,938
Other loans. . . . . . . . . . . . . . 1,111 2,766 5,039 3,054 4,028
-------- -------- -------- -------- --------
Total loans . . . . . . . . . . . . $401,605 $376,872 $350,308 $323,382 $287,787
-------- -------- -------- -------- --------
-------- -------- -------- -------- --------
MATURITIES AND SENSITIVITIES OF LOANS TO CHANGES IN INTEREST RATES
Presented in the table below are the maturities of loans (excluding commercial
real estate, farmland, residential real estate and individuals' loans)
outstanding as of December 31, 1994. Also presented are the amounts due after
one year classified according to the sensitivity to changes in interest rates.
Maturing
-------------------------------------------------------------------
Within 1-5 Over 5
1 Year Years Years Total
------ ----- ------ -----
(Dollars in Thousands)
Commercial and industrial loans. . . . . . . . . $ 67,402 $ 8,382 $ 3,159 $ 78,943
Agricultural production financing
and other loans to farmers . . . . . . . . . . 4,985 253 72 5,310
Real estate - Construction . . . . . . . . . . . 7,936 190 8,126
Tax-exempt loans . . . . . . . . . . . . . . . . 97 519 588 1,204
Other loans. . . . . . . . . . . . . . . . . . . 1,090 21 1,111
-------- -------- -------- --------
Total . . . . . . . . . . . . . . . . . . . $ 81,510 $ 9,365 $ 3,819 $ 94,694
-------- -------- -------- --------
-------- -------- -------- --------
Page 9
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STATISTICAL DATA (Continued)
Maturing
-----------------------------
1 - 5 Over
Years 5 years
----- -------
(Dollars in Thousands)
Loans maturing after one year with:
Fixed rates . . . . . . . . . . . $ 5,855 $ 2,594
Variable rate . . . . . . . . . . 3,510 1,225
------- --------
Total . . . . . . . . . . . . . $ 9,365 $ 3,819
------- --------
------- --------
RISK ELEMENTS
December 31
----------------------------------------
1994 1993 1992 1991 1990
---- ---- ---- ---- ----
(Dollars in Thousands)
Nonaccruing loans. . . . . . . . . . $ 326 $ 527 $ 493 $1,434 $1,178
Loans contractually past due 90
days or more other than
nonaccruing . . . . . . . . . . . . 703 616 949 1,356 1,972
Restructured loans . . . . . . . . . 754 879 548 828 864
Nonaccruing loans are loans which are reclassified to a nonaccruing status when
in management's judgment the collateral value and financial condition of the
borrower do not justify accruing interest. Interest previously recorded but not
deemed collectible is reversed and charged against current income. Interest
income on these loans is then recognized when collected.
Restructured loans are loans for which the contractual interest rate has been
reduced or other concessions are granted to the borrower because of a
deterioration in the financial condition of the borrower resulting in the
inability of the borrower to meet the original contractual terms of the loans.
Interest income of $66,000 for the year ended December 31, 1994, was recognized
on the nonaccruing and restructured loans listed in the table above, whereas
interest income of $105,000 would have been recognized under their original loan
terms.
Potential problem loans:
Management has identified certain other loans totaling $2,711,716 as of December
31, 1994, not included in the risk elements table, which are current as to
principal and interest, about which there are doubts as to the to the borrowers'
ability to comply with present repayment terms.
Page 10
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STATISTICAL DATA (Continued)
SUMMARY OF LOAN LOSS EXPERIENCE
The following table summarizes the loan loss experience for the years indicated.
1994 1993 1992 1991 1990
---- ---- ---- ---- ----
(Dollars in Thousands)
Allowance for loan losses:
Balance at January 1 . . . . . . $ 4,800 $ 4,351 $ 3,867 $ 3,254 $ 2,915
Addition resulting from
acqisition . . . . . . . . . . 252
------- ------- ------- ------- -------
Chargeoffs:
Commercial . . . . . . . . . . 526 391 588 806 614
Real estate mortgage . . . . . 41 129 100 41 46
Installment. . . . . . . . . . 346 388 552 511 590
------- ------- ------- ------- -------
Total chargeoffs. . . . . . . 913 908 1,240 1,358 1,250
------- ------- ------- ------- -------
Recoveries:
Commercial . . . . . . . . . . 216 240 215 227 195
Real estate mortgage . . . . . 30 5 38 7 1
Installment. . . . . . . . . . 83 98 114 84 98
------- ------- ------- ------- -------
Total recoveries. . . . . . . 329 343 367 318 294
------- ------- ------- ------- -------
Net chargeoffs . . . . . . . . . 584 565 873 1,040 956
------- ------- ------- ------- -------
Provisions for loan losses . . . 782 1,014 1,357 1,401 1,295
------- ------- ------- ------- -------
Balance at December 31 . . . . . $ 4,998 $ 4,800 $ 4,351 $ 3,867 $ 3,254
------- ------- ------- ------- -------
------- ------- ------- ------- -------
Ratio of net chargeoffs during the
period to average loans
outstanding during the period. . .15% .16% .26% .35% .35%
Page 11
--------------------------------------------------------------------------------
STATISTICAL DATA (Continued)
ALLOCATION OF THE ALLOWANCE FOR LOAN LOSSES AT DECEMBER 31:
Presented below is an analysis of the composition of the allowance for loan
losses and per cent of loans in each category to total loans:
1994 1993
------------------ ------------------
Amount Per Cent Amount Per Cent
------ -------- ------ -------
(Dollars in Thousands)
Balance at December 31:
Commercial, financial and
agricultural . . . . . . . $ 2,261 21.3% $ 2,187 23.4%
Real estate - construction . 2.0 2.2
Real estate - mortgage . . . 560 57.0 384 55.4
Installment. . . . . . . . . 1,263 19.4 1,266 18.6
Tax-exempt loans . . . . . . .3 .4
Unallocated. . . . . . . . . 914 N/A 963 N/A
-------- ------ ------- ------
Totals . . . . . . . . . . . $ 4,998 100.0% $ 4,800 100.0%
-------- ------ ------- ------
-------- ------ ------- ------
1992 1991
------------------- ------------------
Amount Per Cent Amount Per Cent
------ -------- ------ --------
(Dollars in Thousands)
Balance at December 31:
Commercial, financial and
agricultural . . . . . . . $ 2,193 26.2% $ 2,127 27.3%
Real estate - construction . .7 1.0
Real estate - mortgage . . . 435 55.1 193 53.1
Installment. . . . . . . . . 1,473 17.3 1,547 17.9
Tax-exempt loans . . . . . . .7 0.7
Unallocated. . . . . . . . . 250 N/A N/A
------- ------ ------- ------
Totals . . . . . . . . . . . $ 4,351 100.0% $ 3,867 100.0%
------- ------ ------- ------
------- ------ ------- ------
1990
-------------------
Amount Per Cent
------ --------
(Dollars in Thousands)
Balance at December 31:
Commercial, financial and
agricultural . . . . . . . . $ 1,789 31.2%
Real estate - construction . . 1.2
Real estate - mortgage . . . . 163 50.0
Installment. . . . . . . . . . 1,302 16.6
Tax-exempt loans . . . . . . . 1.0
Unallocated. . . . . . . . . . N/A
------- ------
Totals . . . . . . . . . . . . $ 3,254 100.0%
------- ------
------- ------
Page 12
--------------------------------------------------------------------------------
STATISTICAL DATA (Continued)
LOAN LOSS CHARGEOFF PROCEDURES
The Banks have weekly meetings at which loan delinquencies, maturities and
problems are reviewed. The Board of Directors receive and review reports on
loans monthly.
The Executive Committee of First Merchants' Board meets bimonthly to approve or
disapprove all new loans in excess of $1,000,000 and the Board reviews all
commercial loans in excess of $50,000 which were made or renewed during the
preceding month. Pendleton's and First United's loan committees, consisting of
all loan officers and the president, meet as required to approve or disapprove
any loan which is in excess of an individual loan officer's lending limit.
All chargeoffs are approved by the senior loan officer and are reported to the
Banks' Boards. The Banks charge off loans when a determination is made that all
or a portion of a loan is uncollectible or as a result of examinations by
regulators and the independent auditors.
PROVISION FOR LOAN LOSSES
In banking, loan losses are one of the costs of doing business. Although the
Banks' management emphasize the early detection and chargeoff of loan losses, it
is inevitable that at any time certain losses exist in the portfolio which have
not been specifically identified. Accordingly, the provision for loan losses is
charged to earnings on an anticipatory basis, and recognized loan losses are
deducted from the allowance so established. Over time, all net loan losses must
be charged to earnings. During the year, an estimate of the loss experience for
the year serves as a starting point in determining the appropriate level for the
provision. However, the amount actually provided in any period may be greater
or less than net loan losses, based on management's judgment as to the
appropriate level of the allowance for loan losses. The determination of the
provision in any period is based on management's continuing review and
evaluation of the loan portfolio, and its judgment as to the impact of current
economic conditions on the portfolio. The evaluation by management includes
consideration of past loan loss experience, changes in the composition of the
loan portfolio, and the current condition and amount of loans outstanding.
Page 13
--------------------------------------------------------------------------------
STATISTICAL DATA (Continued)
DEPOSITS
The following table shows the average amount of deposits and average rate of
interest paid thereon for the years indicated.
1994 1993 1992
-------------- --------------- --------------
Amount Rate Amount Rate Amount Rate
------ ---- ------ ---- ------ ----
(Dollars in Thousands)
Balance at December 31:
Noninterest bearing
deposits. . . . . $ 71,743 $ 69,054 $ 60,274
NOW accounts . . . 85,973 2.1% 79,106 2.3% 70,068 3.1%
Money market deposit
accounts. . . . . 105,083 3.0 111,136 2.8 104,855 3.6
Savings deposits . 55,755 2.6 51,697 2.7 46,001 3.6
Certificates of
deposit and other
time deposits . . 195,475 4.1 206,833 4.4 220,328 5.3
-------- -------- --------
Total deposits. $514,029 2.8 $517,826 3.0 $501,526 3.9
-------- -------- --------
-------- -------- --------
As of December 31, 1994, certificates of deposit and other time deposits of
$100,000 or more mature as follows:
Maturing
-----------------------------------------------------------
3 Months 3-6 6-12 Over 12
or less Months Months Months Total
-------- ------ ------ ------- -----
(Dollars in Thousands)
Certificates of
deposit and other
time deposits . . $ 13,526 $ 6,763 $ 3,599 $ 9,734 $33,622
Per cent . . . . . 40% 20% 11% 29%
RETURN ON EQUITY AND ASSETS
1994 1993 1992
---- ---- ----
Return on assets (net income
divided by average total assets). . . 1.44% 1.39% 1.29%
Return on equity (net income
divided by average equity). . . . . . 13.06 13.01 12.71
Dividend payout ratio (dividends
per share divided by net income
per share). . . . . . . . . . . . . . 39.11 36.86 36.96
Equity to assets ratio (average
equity divided by average total
assets) . . . . . . . . . . . . . . . 11.04 10.68 10.16
Page 14
--------------------------------------------------------------------------------
STATISTICAL DATA (Continued)
SHORT-TERM BORROWINGS
1994 1993 1992
---- ---- ----
(Dollars in Thousands)
Balance at December 31:
Federal funds purchased. . . . . . . $ 12,198 $ 5,300
Securities sold under repurchase
agreements. . . . . . . . . . . . 17,776 26,363 $27,340
U.S. Treasury demand notes . . . . . 9,215 15,227 9,733
-------- -------- -------
Total short-term borrowings. . . $ 39,189 $ 46,890 $37,073
-------- -------- -------
-------- -------- -------
Securities sold under repurchase agreements are borrowings maturing within one
year and are secured by U. S. Government securities.
Pertinent information with respect to short-term borrowings is summarized below:
1994 1993 1992
---- ---- ----
(Dollars in Thousands)
Weighted average interest rate on
outstanding balance at December 31:
Securities sold under repurchase
agreements . . . . . . . . . . . . 4.86% 2.86% 3.07%
Total short-term borrowings . . . . 5.42 2.88 3.00
Weighted average interest rate during the
year:
Securities sold under repurchase
agreements . . . . . . . . . . . . 3.91 2.94 3.88
Total short-term borrowings . . . . 4.03 3.02 3.86
Highest amount outstanding at any month end
during the year:
Securities sold under repurchase
agreements . . . . . . . . . . . . $ 29,115 $ 33,949 $39,949
Total short-term borrowings . . . . 68,609 51,130 49,141
Average amount outstanding during the year:
Securities sold under repurchase
agreements . . . . . . . . . . . . 23,389 22,882 23,518
Total short-term borrowings . . . . 45,639 35,317 35,796
Page 15
ITEM 2. PROPERTIES.
--------------------------------------------------------------------------------
The headquarters of the Corporation and First Merchants are located in a five-
story building at 200 East Jackson Street, Muncie, Indiana. This building and
seven branch buildings are owned by First Merchants; six remaining branches of
First Merchants are located in leased premises. Nine automated cash dispensers
are located in leased premises; two cash dispensers are located in premises that
are provided free of charge. All of the Corporation's and First Merchants'
facilities are located in Delaware and Madison Counties of Indiana. The
principal offices of Pendleton are located at 100 West State Street, Pendleton,
Indiana. Pendleton also operates three branches. All of Pendleton's properties
are owned by Pendleton and are located in Madison County, Indiana. The
principal offices of First United are located at 790 West Mill Street,
Middletown, Indiana. First United also operates two branches. All of First
United's properties are owned by First United and are located in Henry County,
Indiana. None of the properties owned by the banks are subject to any major
encumbrances. The net investment of the Corporation and subsidiaries in real
estate and equipment at December 31, 1994 was $9,545,153.
ITEM 3. LEGAL PROCEEDINGS.
--------------------------------------------------------------------------------
There is no pending legal proceeding, other than ordinary routine litigation
incidental to the business of the Corporation or its subsidiaries, of a material
nature to which the Corporation or its subsidiaries is a party or of which any
of their properties are subject. Further, there is no material legal proceeding
in which any director, officer, principal shareholder, or affiliate of the
Corporation, or any associate of any such director, officer or principal
shareholder, is a party, or has a material interest, adverse to the Corporation.
None of the routine legal proceedings, individually or in the aggregate, in
which the Corporation or its affiliates are involved are expected to have a
material adverse impact on the financial position or the results of operations
of the Corporation.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
--------------------------------------------------------------------------------
No matters were submitted during the fourth quarter of 1994 to a vote of
security holders, through the solicitation of proxies or otherwise.
Page 16
SUPPLEMENTAL INFORMATION - EXECUTIVE OFFICERS OF THE REGISTRANT.
--------------------------------------------------------------------------------
The names, ages, and positions with the Corporation and subsidiary banks of all
executive officers of the Corporation are listed below.
Offices with the Corporation Principal Occupation
Name and Age And Subsidiary Banks During Past Five Years
------------ ---------------------------- ----------------------
Stefan S. Anderson Chairman of the Board and Chairman of the Board
60 President, Corporation and of the Corporation and
First Merchants First Merchants since
1987; President of
First Merchants since
1979 and of the
Corporation since 1982
Michael L. Cox Executive Vice President, Chief Executive Vice
50 Operating Officer and Director, President and Chief
Corporation; Executive Vice Operating Officer,
President, First Merchants Corporation since May,
1994; Executive Vice
President, First
Merchants, since May,
1994; Director,
Corporation and First
Merchants since
December, 1984
Roger W. Gilcrest Executive Vice President and Executive Vice
57 Director, First Merchants President First
Merchants since July,
1988; Senior Vice
President, First
Source Bank prior to
July, 1988; Director
of First Merchants
since July 1992.
Paul R. Hoover Senior Vice President, Senior Vice
53 First Merchants President, First
Merchants since 1987
Larry R. Helms Senior Vice President and Senior Vice President,
54 General Counsel, Corporation; Corporation since 1982
Senior Vice President, First and First Merchants
Merchants; Director of First since 1979; Director
United; Director of Pendleton of First United and
Pendleton since 1992
Lowell E. Williams Senior Vice President, First Senior Vice President,
63 First Merchants First Merchants since
1979
James L. Thrash Senior Vice President and Senior Vice President
45 Chief Financial Officer, and Chief Financial
Corporation; Senior Vice Officer of the
President, First Merchants Corporation since
1990; Chief Financial
Officer, Corporation
prior to May 1990;
Senior Vice President,
First Merchants since
1990; Vice President,
First Merchants prior
to April 1990
Jack L. Demaree Senior Vice President and Senior Vice President,
46 Senior Commercial Loan Officer, First Merchants Bank
First Merchants since March 1992,
Senior Commercial Loan
Officer, First
Merchants since 1987;
Vice President, First
Merchants prior to
March 1992
Page 17
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS
--------------------------------------------------------------------------------
The information required under this item is incorporated by reference to page 2
and 3 of the Corporation's 1994 Annual Report to Stockholders, "Everything You'd
Expect...and more," under the caption "Stockholder Information," Exhibit 13.
ITEM 6. SELECTED FINANCIAL DATA.
--------------------------------------------------------------------------------
The information required under this item is incorporated by reference to page 1
of the Corporation's 1994 Annual Report to Stockholders, "Financial Review,"
under the caption "Five-Year Summary of Selected Financial Data," Exhibit 13.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
--------------------------------------------------------------------------------
The information required under this item is incorporated by reference to page 2
through 6 of the Corporation's 1994 Annual Report to Stockholders, "Financial
Review," under the caption "Management's Discussion and Analysis," Exhibit 13.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
--------------------------------------------------------------------------------
The financial statements and supplementary data required under this item are
incorporated herein by reference to inside cover and pages 7 through 22 of the
Corporation's 1994 Annual Report to Stockholders, "Financial Review," Exhibit
13.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
--------------------------------------------------------------------------------
In connection with its audits for the two most recent fiscal years ended
December 31, 1994, there have been no disagreements with the Corporation's
independent certified public accountants on any matter of accounting principles
or practices, financial statement disclosure or audit scope or procedure, nor
have there been any changes in accountants.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
--------------------------------------------------------------------------------
The information required under this item relating to directors is incorporated
by reference to the Corporation's 1995 Proxy Statement furnished to its
stockholders in connection with an annual meeting to be held March 30, 1995 (the
"1995 Proxy Statement"), under the caption "Election of Directors," which Proxy
Statement has been filed with the Commission. The information required under
this item relating to executive officers is set forth in Part I, "Supplemental
Information - Executive Officers of the Registrant" of this annual report on
Form 10-K.
ITEM 11. EXECUTIVE COMPENSATION.
--------------------------------------------------------------------------------
The information required under this item is incorporated by reference to the
Corporation's 1995 Proxy Statement, under the captions, "Compensation of
Directors" and "Compensation of Executive Officers," which Proxy Statement has
been filed with the Commission.
Page 18
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
--------------------------------------------------------------------------------
The information required under this item is incorporated by reference to the
Corporation's 1995 Proxy Statement, under the caption, "Security Ownership of
Certain Beneficial Owners and Management," which Proxy Statement has been filed
with the Commission.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
--------------------------------------------------------------------------------
The information required under this item is incorporated by reference to the
Corporation's 1995 Proxy Statement, under the caption "Interest of Management in
Certain Transactions," which Proxy Statement has been filed with the Commission.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
--------------------------------------------------------------------------------
Annual Report
"Financial Review" Form 10-K
Page Page
Number Number
----------------- ------------
(a)1. Financial Statements:
Independent auditor's
report . . . . . . . . . . . . . . . Inside 90
Cover
Consolidated balance sheet
at December 31, 1994 and 1993. . . . 7 97
Consolidated statement of income,
years ended December 31, 1994,
1993 and 1992. . . . . . . . . . . . 8 98
Consolidated statement of changes in
stockholders' equity, years ended
December 31, 1994, 1993 and 1992 . . 9 99
Consolidated statement of cash flows,
years ended December 31, 1994, 1993
and 1992 . . . . . . . . . . . . . . 9-10 99-100
Notes to consolidated financial
statements . . . . . . . . . . . . . 11-22 101-112
(a)2. Financial statement schedules:
All schedules are omitted because
they are not applicable or not
required, or because the required
information is included in the
consolidated financial statements
or related notes.
(a)3. Exhibits:
Exhibit No: Description of Exhibit:
---------- ----------------------
3.1 Articles of Incorporation, dated
September 20, 1982 and the Articles
of Amendment thereto dated March 13,
1985 and March 14, 1988 . . . . . . . 27-49
3.2 Bylaws and amendments thereto dated
February 12, 1985, February 20, 1987,
July 14, 1987, December 8, 1987,
December 13, 1988, November 14, 1989,
August 13, 1991, April 14, 1992, and
February 15, 1994 and August 9, 1994 . 50-70
Page 19
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
(Continued)
--------------------------------------------------------------------------------
Form 10-K
Page
Exhibit No: Description of Exhibit: Number
---------- ---------------------- ---------
10.1 First Merchants Bank, National
Association Management Incentive
Plan . . . . . . . . . . . . . . . . (A)
10.2 Unfunded Deferred Compensation Plan,
as Amended . . . . . . . . . . . . (D)
10.3 Employee Stock Purchase Plan (1989) . (B)
10.4 1989 Stock Option Plan . . . . . . . (C)
10.5 Employee Stock Purchase Plan (1994) . . (E)
10.6 1994 Stock Option Plan . . . . . . . . (E)
13 1993 Annual Report to Stockholders
(except for the Pages and information
thereof expressly incorporated by
reference in this Form 10-K, the
Annual Report to Stockholders is
provided solely for the information
of the Securities and Exchange
Commission and is not deemed "filed"
as part of this Form 10-K) . . . . . 71-112
22 Subsidiaries of Registrant . . . . . . 24
23 Consent of Independent Auditors. . . . 25
27 Financial Data Schedule
99.1 Financial statements and independent
auditor's report for First Merchants
Corporation Employee Stock Purchase
Plan. . . . . . . . . . . . . . . . . 26
(A) Incorporated by reference to Registrant's Registration Statement on Form
S-4 (SEC File No. 33-110) ordered effective on September 30, 1988.
(B) Incorporated by reference to Registrant's Registration Statement on Form
S-8 (SEC File No. 33-28900) effective on May 24, 1989.
(C) Incorporated by reference to Registrant's Registration Statement on Form
S-8 (SEC File No. 33-28901) effective on May 24, 1989.
(D) Incorporated by reference to Registrant's Form 10-K for year ended
December 31, 1990.
(E) Incorporated by reference to Registrant's Form 10-K for year ended
December 31, 1993.
(b) Reports on Form 8-K:
No reports on Form 8-K were filed for the three months ended December
31, 1994.
Page 20
--------------------------------------------------------------------------------
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized, on this 14th day of March,
1995.
FIRST MERCHANTS CORPORATION
By /s/ Stefan S. Anderson, Chairman
-----------------------------------
Stefan S. Anderson, Chairman
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
on Form 10-K has been signed by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
Signature Capacity Date
------------------------- ------------------------------- -----------------
/s/ Stefan S. Anderson Director and Chairman, March 14, 1995
------------------------- Principal Executive Officer
Stefan S. Anderson
/s/ Frank A. Bracken Director March 14, 1995
-------------------------
Frank A. Bracken
/s/ Thomas B. Clark Director March 14, 1995
-------------------------
Thomas B. Clark
/s/ Michael L. Cox Director March 14, 1995
-------------------------
Michael L. Cox
------------------------- Director March 14, 1995
David A. Galliher
/s/ Thomas K. Gardiner Director March 14, 1995
-------------------------
Thomas K. Gardiner
/s/ Hurley C. Goodall Director March 14, 1995
-------------------------
Hurley C. Goodall
/s/ John W. Hartmeyer Director March 14, 1995
-------------------------
John W. Hartmeyer
/s/ Nelson W. Heinrichs Director March 14, 1995
-------------------------
Nelson W. Heinrichs
Page 21
------------------------------------------------------------------------------
Signature Capacity Date
------------------------- ------------------------------- -----------------
/s/ Jon H. Moll Director March 14, 1995
-------------------------
Jon H. Moll
/s/ Robert M. Smitson Director March 14, 1995
-------------------------
Robert M. Smitson
/s/ Joseph E. Wilson Director March 14, 1995
-------------------------
Joseph E. Wilson
------------------------- Director March 14, 1995
Robert F. Wisehart
/s/ John E. Worthen Director March 14, 1995
-------------------------
John E. Worthen
/s/ James L. Thrash Principal Financial and March 14, 1995
------------------------- Principal Accounting Officer
James L. Thrash
Page 22
INDEX TO EXHIBITS
--------------------------------------------------------------------------------
Form 10-K
Page
Exhibit No: Description of Exhibit: Number
---------- ---------------------- ---------
3.1 Articles of Incorporation, dated
September 20, 1982 and the
Articles of Amendment thereto
dated March 13, 1985 and March
14, 1988 . . . . . . . . . . . . 27-49
3.2 Bylaws and amendments thereto dated
February 12, 1985, February 20, 1987,
July 14, 1987, December 8, 1987,
December 13, 1988, November 14, 1989,
August 13, 1991, April 14, 1992, and
February 15, 1994 and August 9, 1994 50-70
10.1 First Merchants Bank, National
Association Management Incentive Plan (A)
10.2 Unfunded Deferred Compensation Plan,
as Amended . . . . . . . . . . . (D)
10.3 Employee Stock Purchase Plan (1989) (B)
10.4 1989 Stock Option Plan . . . . . (C)
10.5 Employee Stock Purchase Plan (1994) (E)
10.6 1994 Stock Option Plan . . . . . (E)
13 1993 Annual Report to Stockholders
(except for the Pages and information
thereof expressly incorporated by
reference in this Form 10-K, the
Annual Report to Stockholders is
provided solely for the information
of the Securities and Exchange
Commission and is not deemed "filed"
as part of this Form 10-K) . . . 71-112
22 Subsidiaries of Registrant . . . . 24
23 Consent of Independent Auditors. . 25
27 Financial Data Schedules
99.1 Financial statements and independent
auditor's report for First Merchants
Corporation Employee Stock Purchase
Plan . . . . . . . . . . . . . . 26
(A) Incorporated by reference to Registrant's Registration Statement on Form
S-4 (SEC File No. 33-110) ordered effective on September 30, 1988.
(B) Incorporated by reference to Registrant's Registration Statement on Form
S-8 (SEC File No. 33-28900) effective on May 24, 1989.
(C) Incorporated by reference to Registrant's Registration Statement on Form
S-8 (SEC File No. 33-28901) effective on May 24, 1989.
(D) Incorporated by reference to Registrant's Form 10-K for year ended
December 31, 1990.
(E) Incorporated by reference to Registrant's Form 10-K for year ended
December 31, 1993.
Page 23