Press Release

German American Bancorp, Inc. (GABC) Reports Record Quarterly Earnings

Company Release - 4/29/2019 5:15 PM ET

JASPER, Ind., April 29, 2019 (GLOBE NEWSWIRE) -- German American Bancorp, Inc. (NASDAQ: GABC) reported record quarterly earnings of $15.1 million, or $0.60 per share, for the quarter ending on March 31, 2019.  This level of quarterly earnings performance was an increase of 36%, on a per share basis, compared with fourth quarter 2018 net income of $11.0 million, or $0.44 per share, and an increase of 18%, on a per share basis, compared with the first quarter 2018 net income of $11.8 million, or $0.51 per share.

These quarterly comparisons are inclusive of the Company’s 2018 five-branch acquisition in the greater Columbus, Indiana market area on May 18, 2018 and its acquisition of First Security, Inc. on October 15, 2018.  First Security was based in Owensboro, Kentucky, and operated 11 retail banking offices in the Owensboro, Bowling Green, Franklin and Lexington, Kentucky market areas and in Evansville and Newburgh, Indiana market area.

The record first quarter 2019 earnings, as compared with the fourth quarter of 2018, were partially attributable to an increased level of net interest income during the current quarter, resulting from both increased average earning assets and an improved tax-equivalent net interest margin.  The increased level of average earning assets during the first quarter of 2019, compared to the fourth quarter of 2018, was largely attributable to the effect of the acquisition of First Security on October 15, 2018.

Other factors contributing to the record first quarter earnings included the recording of $1.4 million in contingency insurance revenue during the quarter and a $3.1 million decline in the level of operating expenses, as compared to the fourth quarter of 2018.  The decline in operating expenses was materially due to a reduced level of acquisition-related expenses in the first quarter.  The first quarter of 2019 results of operations included acquisition-related expenses of approximately $544,000 ($407,000 or $0.02 per share, on an after-tax basis), compared to $3.1 million (or $2.3 million, or $0.09 per share, on an after-tax basis) in the fourth quarter of 2018.

End of period loans and deposits as of March 31, 2019, relative to December 31, 2018 year-end balances, were relatively flat to slightly lower, as March 31, 2019 total loans declined by 3% on annualized basis, while total deposits decreased by 1% on an annualized basis.  The slight decrease in loans and deposits during the quarter was largely attributable to seasonality as the first quarter is historically a slower growth period for the Company, specifically related to seasonal pay-downs within the agricultural loan portfolio.  Additionally, the Company repositioned a portion of the acquired loan portfolio during the quarter, resulting in an elevated level of loan payoffs, including within the residential mortgage loan portfolio.

Commenting on the Company’s record first quarter performance, Mark A. Schroeder, German American’s Chairman & CEO, stated, "We’re extremely pleased with the strong start we experienced during the first quarter of this year, both in terms of earnings growth and the continued integration of First Security.  Additionally, we announced the pending acquisition of Citizens First Corporation of Bowling Green, Kentucky on February 21, 2019.  The combination of First Security and Citizens First in the vibrant Bowling Green market will position German American as one of market share leaders in this dynamic market.”

Schroeder continued, “While balance sheet growth was limited during the quarter due to seasonal factors, we remain very encouraged about our ability to experience strong growth throughout the balance of this year.  Our loan pipelines continue to be exceptionally strong, as evidenced by the 9% growth, on an annualized basis, that we saw within our Commercial & Industrial Loans during the first quarter.  We also were very pleased with the approximately 5% annualized growth in end of period balances in Non-interest-bearing Demand Deposits.  Even though the current economic recovery is approaching historic length, we’re continuing to see indications that economic growth will remain strong throughout 2019."

The Company also announced its Board of Directors declared a regular quarterly cash dividend of $0.17 per share, which will be payable on May 20, 2019 to shareholders of record as of May 10, 2019.

Balance Sheet Highlights

The Company completed a five-branch acquisition of locations of First Financial Bancorp (formerly branch locations of Mainsource Financial Group, Inc. prior to its merger with First Financial Bancorp) on May 18, 2018.  Four of the branches are located in Columbus, Indiana, and one in Greensburg, Indiana.  In addition, on October 15, 2018, the Company completed its acquisition of First Security, Inc. ("First Security") and its subsidiary bank, First Security Bank, Inc.  First Security was based in Owensboro, Kentucky, and operated 11 retail banking offices in Owensboro, Bowling Green, Franklin and Lexington, Kentucky and in Evansville and Newburgh, Indiana.

Total assets for the Company totaled $3.896 billion at March 31, 2019, representing a decline of $33.6 million, or 3% on an annualized basis, compared with December 31, 2018 and an increase of $770.5 million, or 25%, compared with March 31, 2018.  The increase in total assets as of March 31, 2019 compared to a year ago was driven largely by the acquisition of First Security and the five-branch network in the Columbus and Greensburg, Indiana markets, as well as organic loan growth.

March 31, 2019 total loans declined $19.3 million, or 3% on an annualized basis, compared with December 31, 2018 and increased $558.6 million, or 26%, compared with March 31, 2018.

The decline during the first quarter of 2019 was driven by a seasonal decline in agricultural loans of approximately $17.2 million, or 19% on an annualized basis, and a decline in retail loans of $17.8 million, or 12% on an annualized basis, partially mitigated by an increase of $12.2 million, or 9% on an annualized basis, of commercial and industrial loans, and an increase of $3.4 million, or 1% on an annualized basis, of commercial real estate loans.

      
End of Period Loan Balances3/31/2019 12/31/2018 3/31/2018
(dollars in thousands)     
      
Commercial & Industrial Loans$555,967  $543,761  $482,219 
Commercial Real Estate Loans1,212,090  1,208,646  947,948 
Agricultural Loans347,999  365,208  329,138 
Consumer Loans281,724  285,534  216,435 
Residential Mortgage Loans314,634  328,592  178,108 
 $2,712,414  $2,731,741  $2,153,848 
      

Non-performing assets totaled $13.1 million at March 31, 2019 compared to $13.5 million at December 31, 2018 and $10.7 million at March 31, 2018.  Non-performing assets represented 0.34% of total assets at each of March 31, 2019, December 31, 2018 and March 31, 2018.  Non-performing loans totaled $12.4 million at March 31, 2019 compared to $13.2 million at December 31, 2018 and $10.6 million at March 31, 2018.  Non-performing loans represented 0.46% of total loans at March 31, 2019 compared to 0.48% at December 31, 2018 and 0.49% at March 31, 2018.

      
Non-performing Assets     
(dollars in thousands)     
 3/31/2019 12/31/2018 3/31/2018
Non-Accrual Loans$12,036  $12,579  $9,479 
Past Due Loans (90 days or more)393  633  1,105 
Total Non-Performing Loans12,429  13,212  10,584 
Other Real Estate685  286  68 
Total Non-Performing Assets$13,114  $13,498  $10,652 
      
Restructured Loans$119  $121  $124 
      

The Company’s allowance for loan losses totaled $16.2 million at March 31, 2019 compared to $15.8 million at December 31, 2018 and $14.5 million at March 31, 2018.  The allowance for loan losses represented 0.60% of period-end loans at March 31, 2019 compared with 0.58% of period-end loans at December 31, 2018 and 0.67% of period-end loans at March 31, 2018.  From time to time, the Company has acquired loans through bank and branch acquisitions with the most recent being the First Security acquisition during the fourth quarter of 2018 and a five-branch acquisition in the second quarter of 2018.  Under acquisition accounting treatment, loans acquired are recorded at fair value which includes a credit risk component, and therefore the allowance on loans acquired is not carried over from the seller.  The Company held a net discount on acquired loans of $18.2 million at March 31, 2019, $19.5 million at December 31, 2018 and $7.3 million at March 31, 2018.

March 31, 2019 total deposits declined $7.5 million, or 1% on an annualized basis, compared with December 31, 2018 and increased $598.0 million compared with March 31, 2018.

      
End of Period Deposit Balances3/31/2019 12/31/2018 3/31/2018
(dollars in thousands)     
      
Non-interest-bearing Demand Deposits$723,995  $715,972  $599,374 
IB Demand, Savings, and MMDA Accounts1,706,913  1,768,177  1,465,150 
Time Deposits < $100,000248,686  249,309  193,864 
Time Deposits > $100,000385,576  339,174  208,733 
 $3,065,170  $3,072,632  $2,467,121 
      

Results of Operations Highlights – Quarter ended March 31, 2019

Net income for the quarter ended March 31, 2019 totaled $15,067,000, or $0.60 per share, an increase of 36% on a per share basis compared with fourth quarter 2018 net income of $10,980,000, or $0.44 per share, and an  increase of 18% on a per share basis compared with the first quarter 2018 net income of $11,813,000, or $0.51 per share.

Net income for each quarter presented was impacted by merger and acquisition activity during 2018 and 2019.  The first quarter of 2019 results of operations included acquisition-related expenses of approximately $544,000 ($407,000 or $0.02 per share, on an after tax basis), while the the fourth quarter of 2018 results of operations included acquisition-related expenses of approximately $3,107,000 ($2,343,000 or $0.09 per share, on an after tax basis) and the first quarter of 2018 included approximately $186,000 ($139,000 or less than $0.01 per share on an after tax basis).

                   
Summary Average Balance Sheet                  
(Tax-equivalent basis / dollars in thousands)                  
   Quarter Ended  Quarter Ended  Quarter Ended
  March  31, 2019 December 31, 2018 March 31, 2018
                   
   Principal
Balance
  Income/
Expense
  Yield/
Rate
  Principal
Balance
  Income/
Expense
  Yield/
Rate
  Principal
Balance
  Income/
Expense
  Yield/
Rate
Assets                  
Federal Funds Sold and Other                  
Short-term Investments $24,538  $141  2.32% $20,925  $97  1.83% $8,556  $56  2.65%
Securities 825,625  6,549  3.17% 812,191  6,447  3.18% 753,589  5,708  3.03%
Loans and Leases 2,718,808  35,207  5.24% 2,662,502  33,771  5.04% 2,139,704  24,032  4.55%
Total Interest Earning Assets $3,568,971  $41,897  4.74% $3,495,618  $40,315  4.58% $2,901,849  $29,796  4.15%
                      
Liabilities                     
Demand Deposit Accounts $691,107       $714,504       $585,432      
IB Demand, Savings, and                     
MMDA Accounts $1,731,118  $2,695  0.63% $1,794,891  $2,808  0.62% $1,489,363  $1,275  0.35%
Time Deposits 646,726  2,721  1.71% 593,615  2,151  1.44% 398,397  1,008  1.03%
FHLB Advances and Other Borrowings 330,463  2,182  2.68% 271,834  1,654  2.42% 262,784  1,252  1.93%
Total Interest-Bearing Liabilities $2,708,307  $7,598  1.14% $2,660,340  $6,613  0.99% $2,150,544  $3,535  0.67%
                      
Cost of Funds     0.86%     0.75%     0.49%
Net Interest Income   $34,299       $33,702       $26,261    
Net Interest Margin     3.88%     3.83%     3.66%
                      

During the quarter ended March 31, 2019, net interest income totaled $33,591,000, which represented an increase of $608,000, or 2%, from the quarter ended December 31, 2018 net interest income of $32,983,000 and an increase of $7,981,000, or 31%, compared with the quarter ended March 31, 2018 net interest income of $25,610,000. The increased level of net interest income during the first quarter of 2019 compared with both the fourth quarter of 2018 and the first quarter of 2018 was driven primarily by a higher level of average earning assets and an improved tax equivalent net interest margin.  The increased level of average earning assets during the first quarter of 2019 compared with the fourth quarter of 2018, was driven primarily by the completed acquisition of First Security on October 15, 2018.

The tax equivalent net interest margin for the quarter ended March 31, 2019 was 3.88% compared with 3.83% in the fourth quarter of 2018 and 3.66% in the first quarter of 2018.  Accretion of loan discounts on acquired loans contributed approximately 16 basis points to the net interest margin on an annualized basis in the first quarter of 2019, 13 basis points in the fourth quarter of 2018, and 4 basis points in the first quarter of 2018.

During the quarter ended March 31, 2019, the Company recorded a provision for loan loss of $675,000 compared with no provision for loan loss in the fourth quarter of 2018 and $350,000 in the first quarter of 2018.  The provision during all periods was done in accordance with the Company's standard methodology for determining the adequacy of its allowance for loan loss.

During the quarter ended March 31, 2019, non-interest income totaled $11,658,000, an increase of $1,925,000, or 20%, compared with the quarter ended December 31, 2018, and an increase of $2,166,000, or 23%, compared with the first quarter of 2018.

      
 Quarter Ended Quarter Ended Quarter Ended
Non-interest Income3/31/2019 12/31/2018 3/31/2018
(dollars in thousands)     
      
Trust and Investment Product Fees$1,567  $1,645  $1,773 
Service Charges on Deposit Accounts1,900  2,072  1,471 
Insurance Revenues3,205  1,877  2,930 
Company Owned Life Insurance884  420  312 
Interchange Fee Income2,095  2,235  1,482 
Other Operating Income871  629  604 
Subtotal10,522  8,878  8,572 
Net Gains on Loans981  583  650 
Net Gains on Securities155  272  270 
Total Non-interest Income$11,658  $9,733  $9,492 
      

Service charges on deposit accounts declined $172,000, or 8%, during the first quarter of 2019 compared with the fourth quarter of 2018 and increased $429,000, or 29%, compared with the first quarter of 2018.  The decline during the first quarter of 2019 compared with the fourth quarter of 2018 was largely related to seasonal declines in deposit fees, while the increase during the first quarter of 2019 compared with first quarter of 2018 was largely attributable to the acquisitions completed during 2018.

Insurance revenues increased $1,328,000, or 71%, during the quarter ended March 31, 2019, compared with the fourth quarter of 2018 and increased $275,000, or 9%, compared with the first quarter of 2018.  The increase during the first quarter of 2019 compared with each of the fourth quarter of 2018 and the first quarter of 2018 was primarily due to increased contingency revenue.  Contingency revenue during the first quarter of 2019 totaled $1,375,000 compared with no contingency revenue during the fourth quarter of 2018 and $1,218,000 during the first quarter of 2018.  The fluctuation in contingency revenue is a normal course of business variance and is reflective of claims and loss experience with insurance carriers that the Company represents through its property and casualty insurance agency.  Typically, the majority of contingency revenue is recognized during the first quarter of the year.

Company owned life insurance revenue increased $464,000, or 110%, during the quarter ended March 31, 2019, compared with the fourth quarter of 2018 and increased $572,000, or 183%, compared with the first quarter of 2018. The increases were largely related to death benefits of $554,000 received from life insurance policies during the first quarter of  2019.

Interchange fees declined $140,000, or 6%, during the first quarter of 2019 compared with the fourth quarter of 2018 and increased $613,000, or 41%, compared with the first quarter of 2018.  The increase during the first quarter of 2019 compared with the first quarter of 2018 was largely attributable to increased card utilization by customers and the acquisitions completed during 2018.

Other operating income increased $242,000, or 38%, during the quarter ended March 31, 2019 compared with the fourth quarter of 2018 and increased $267,000, or 44%, compared with the first quarter of 2018.  The increase during the first quarter quarter of 2019 compared with both comparative periods was largely attributable to the gain realized on the sale of a former branch facility of $262,000.

Net gains on sales of loans increased $398,000, or 68%, during the first quarter of 2019 compared with the fourth quarter of 2018 and increased $331,000, or 51%, compared with the first quarter of 2018.  The increase during the first quarter of 2019 in the net gain on sale compared with both comparative periods was largely attributable to higher pricing levels on loans sold.  Loan sales totaled $28.9 million during the first quarter of 2019, compared with $35.7 million during the fourth quarter of 2018 and $29.9 million during the first quarter of 2018.

During the quarter ended March 31, 2019, non-interest expense totaled $26,759,000, a decline of $3,055,000, or 10%, compared with the quarter ended December 31, 2018, and an increase of $6,304,000, or 31%, compared with the first quarter of 2018.  The first quarter of 2019 included acquisition-related expenses of $544,000 while the fourth quarter of 2018 included acquisition-related expenses of approximately $3,107,000 and the first quarter of 2018 included acquisition-related expenses of approximately $186,000.

      
 Quarter Ended Quarter Ended Quarter Ended
Non-interest Expense3/31/2019 12/31/2018 3/31/2018
(dollars in thousands)     
      
Salaries and Employee Benefits$15,044  $15,027  $12,126 
Occupancy, Furniture and Equipment Expense3,219  3,203  2,409 
FDIC Premiums288  234  237 
Data Processing Fees1,583  3,108  1,127 
Professional Fees1,327  2,337  871 
Advertising and Promotion870  1,083  701 
Intangible Amortization843  810  206 
Other Operating Expenses3,585  4,012  2,778 
Total Non-interest Expense$26,759  $29,814  $20,455 
      

Salaries and benefits increased $17,000, or less than 1%, during the quarter ended March 31, 2019 compared with the fourth quarter of 2018 and increased $2,918,000, or 24%, compared with the first quarter of 2018.  The increase in salaries and benefits during the first quarter of 2019 compared with both the fourth quarter of 2018 and the first quarter of 2018 was primarily attributable to an increased number of full-time equivalent employees due in part to the acquisition transactions completed during 2018.  The fourth quarter of 2018 also included approximately $474,000 of acquisition-related salary and benefit costs.

Occupancy, furniture and equipment expense increased $16,000, or less than 1%, during the first quarter of 2019 compared with the fourth quarter of 2018 and increased $810,000, or 34%, compared to the first quarter of 2018.  The increase during the first quarter of 2019 compared with the first quarter of 2018 was primarily due to operating costs related to the acquisitions completed during 2018 as well as other facilities the Company has placed into service over the past several quarters.

Data processing fees declined $1,525,000, or 49%, during the first quarter of 2019 compared with the fourth quarter of 2018 and increased $456,000, or 40%, compared to the first quarter of 2018.  The decline during the first quarter of 2019 compared with the fourth quarter of 2018 was driven by acquisition and conversion-related costs which totaled approximately $1,668,000 during the fourth quarter of 2018.  The increase in data processing fees during the first quarter of 2019 compared with the first quarter of 2018 was also related to the on-going operating costs associated with the acquisitions completed during 2018.

Professional fees declined $1,010,000, or 43%, during the first quarter of 2019 compared with the fourth quarter of 2018 and increased $456,000, or 52%, compared to the first quarter of 2018.  The decline during the first quarter of 2019 compared to the fourth quarter of 2018 was due in part to professional fees related to merger and acquisition activity during 2018 and to fees related to certain contract negotiations.  The increase in professional fees during the first quarter of 2019 compared with 2018 was largely related to acquisition related professional fees.  Merger and acquisition related professional fees totaled approximately $508,000 during the first quarter of 2019 compared with $730,000 in the fourth quarter of 2018 and $177,000 during the first quarter of 2018.  Professional fees during the fourth quarter of 2018 also included approximately $930,000 in fees related to certain contract negotiations.

Intangible amortization increased $33,000, or 4%, during the quarter ended March 31, 2019 compared with the fourth quarter of 2018 and increased $637,000, or 309%, compared with the first quarter of 2018.  The increase in intangible amortization was attributable to the previously discussed acquisitions completed during 2018.

Other operating expenses declined $427,000, or 11%, during the first quarter of 2019 compared with the fourth quarter of 2018 and increased $807,000, or 29%, compared with the first quarter of 2018.  The decline in the first quarter of 2019 compared with the fourth quarter of 2018 was partially attributable to acquisition-related expenses that totaled approximately $176,000 during the fourth quarter of 2018.   The increase during the first quarter of 2019 compared with the first quarter of 2018 was largely attributable to the operating costs related to the acquisitions completed in 2018.

About German American

German American Bancorp, Inc. is a NASDAQ-traded (symbol: GABC) bank holding company based in Jasper, Indiana.  German American, through its banking subsidiary German American Bank, operates 65 banking offices in 20 contiguous southern Indiana counties and four counties in Kentucky.  The Company also owns an investment brokerage subsidiary (German American Investment Services, Inc.) and a full line property and casualty insurance agency (German American Insurance, Inc.).

Cautionary Note Regarding Forward-Looking Statements

Certain statements in this press release may be deemed “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.  Readers are cautioned that, by their nature, forward-looking statements are based on assumptions and are subject to risks, uncertainties, and other factors. Actual results and experience could differ materially from the anticipated results or other expectations expressed or implied by these forward-looking statements as a result of a number of factors, including but not limited to, those discussed in this press release. Factors that could cause actual experience to differ from the expectations expressed or implied in this press release include the unknown future direction of interest rates and the timing and magnitude of any changes in interest rates; changes in competitive conditions; the introduction, withdrawal, success and timing of asset/liability management strategies or of mergers and acquisitions and other business initiatives and strategies; changes in customer borrowing, repayment, investment and deposit practices; changes in fiscal, monetary and tax policies; changes in financial and capital markets; potential deterioration in general economic conditions, either nationally or locally, resulting in, among other things, credit quality deterioration; capital management activities, including possible future sales of new securities, or possible repurchases or redemptions by the Company of outstanding debt or equity securities; risks of expansion through acquisitions and mergers, such as unexpected credit quality problems of the acquired loans or other assets, unexpected attrition of the customer base of the acquired institution or branches, and difficulties in integration of the acquired operations; factors driving impairment charges on investments; the impact, extent and timing of technological changes; potential cyber-attacks, information security breaches and other criminal activities; litigation liabilities, including related costs, expenses, settlements and judgments, or the outcome of matters before regulatory agencies, whether pending or commencing in the future; actions of the Federal Reserve Board; changes in accounting principles and interpretations; potential increases of federal deposit insurance premium expense, and possible future special assessments of FDIC premiums, either industry wide or specific to the Company’s banking subsidiary; actions of the regulatory authorities under the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act") and the Federal Deposit Insurance Act and other possible legislative and regulatory actions and reforms; impacts resulting from possible amendments or revisions to the Dodd-Frank Act and the regulations promulgated thereunder, or to Consumer Financial Protection Bureau rules and regulations; the continued availability of earnings and excess capital sufficient for the lawful and prudent declaration and payment of cash dividends; and other risk factors expressly identified in the Company’s filings with the United States Securities and Exchange Commission. Such statements reflect our views with respect to future events and are subject to these and other risks, uncertainties and assumptions relating to the operations, results of operations, growth strategy and liquidity of the Company. Readers are cautioned not to place undue reliance on these forward-looking statements. It is intended that these forward-looking statements speak only as of the date they are made. We do not undertake any obligation to release publicly any revisions to these forward-looking statements to reflect future events or circumstances or to reflect the occurrence of unanticipated events.

GERMAN AMERICAN BANCORP, INC.
(unaudited, dollars in thousands except per share data)
      
Consolidated Balance Sheets
      
 March 31, 2019 December 31, 2018 March 31, 2018
ASSETS     
Cash and Due from Banks$45,038  $64,549  $32,023 
Short-term Investments14,740  32,251  8,187 
Investment Securities824,950  812,964  737,957 
      
Loans Held-for-Sale8,586  4,263  6,628 
      
Loans, Net of Unearned Income2,708,832  2,728,059  2,150,546 
Allowance for Loan Losses(16,243) (15,823) (14,460)
Net Loans2,692,589  2,712,236  2,136,086 
      
Stock in FHLB and Other Restricted Stock13,048  13,048  13,048 
Premises and Equipment89,600  80,627  58,024 
Goodwill and Other Intangible Assets112,920  113,645  55,954 
Other Assets94,053  95,507  77,111 
TOTAL ASSETS$3,895,524  $3,929,090  $3,125,018 
      
LIABILITIES     
Non-interest-bearing Demand Deposits$723,995  $715,972  $599,374 
Interest-bearing Demand, Savings, and Money Market Accounts1,706,913  1,768,177  1,465,150 
Time Deposits634,262  588,483  402,597 
Total Deposits3,065,170  3,072,632  2,467,121 
      
Borrowings317,480  376,409  274,473 
Other Liabilities33,687  21,409  19,419 
TOTAL LIABILITIES3,416,337  3,470,450  2,761,013 
      
SHAREHOLDERS' EQUITY     
Common Stock and Surplus254,625  254,314  188,501 
Retained Earnings222,246  211,424  187,342 
Accumulated Other Comprehensive Income (Loss)2,316  (7,098) (11,838)
SHAREHOLDERS' EQUITY479,187  458,640  364,005 
      
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$3,895,524  $3,929,090  $3,125,018 
      
END OF PERIOD SHARES OUTSTANDING24,992,238  24,967,458  22,968,813 
      
TANGIBLE BOOK VALUE PER SHARE (1)$14.66  $13.81  $13.41 
      
 
(1) Tangible Book Value per Share is defined as Total Shareholders' Equity less Goodwill and Other Intangible Assets divided by End of Period Shares Outstanding.


GERMAN AMERICAN BANCORP, INC.
(unaudited, dollars in thousands except per share data)
      
Consolidated Statements of Income
      
 Three Months Ended
 March 31, 2019 December 31, 2018 March 31, 2018
INTEREST INCOME     
Interest and Fees on Loans$35,119  $33,678  $23,950 
Interest on Short-term Investments141  97  56 
Interest and Dividends on Investment Securities5,929  5,821  5,139 
TOTAL INTEREST INCOME41,189  39,596  29,145 
      
INTEREST EXPENSE     
Interest on Deposits5,416  4,959  2,283 
Interest on Borrowings2,182  1,654  1,252 
TOTAL INTEREST EXPENSE7,598  6,613  3,535 
      
NET INTEREST INCOME33,591  32,983  25,610 
Provision for Loan Losses675    350 
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES32,916  32,983  25,260 
      
NON-INTEREST INCOME     
Net Gain on Sales of Loans981  583  650 
Net Gain on Securities155  272  270 
Other Non-interest Income10,522  8,878  8,572 
TOTAL NON-INTEREST INCOME11,658  9,733  9,492 
      
NON-INTEREST EXPENSE     
Salaries and Benefits15,044  15,027  12,126 
Other Non-interest Expenses11,715  14,787  8,329 
TOTAL NON-INTEREST EXPENSE26,759  29,814  20,455 
      
Income before Income Taxes17,815  12,902  14,297 
Income Tax Expense2,748  1,922  2,484 
      
NET INCOME$15,067  $10,980  $11,813 
      
BASIC EARNINGS PER SHARE$0.60  $0.44  $0.51 
DILUTED EARNINGS PER SHARE$0.60  $0.44  $0.51 
      
WEIGHTED AVERAGE SHARES OUTSTANDING24,971,863  24,962,878  22,940,402 
DILUTED WEIGHTED AVERAGE SHARES OUTSTANDING24,971,863  24,962,878  22,940,402 
      
      


GERMAN AMERICAN BANCORP, INC.
(unaudited, dollars in thousands except per share data)
       
  Three Months Ended
  March 31, December 31, March 31,
  2019 2018 2018
EARNINGS PERFORMANCE RATIOS     
 Annualized Return on Average Assets1.55% 1.15% 1.51%
 Annualized Return on Average Equity12.98% 10.05% 13.00%
 Net Interest Margin3.88% 3.83% 3.66%
 Efficiency Ratio (1)58.23% 68.64% 57.21%
 Net Overhead Expense to Average Earning Assets (2)1.69% 2.30% 1.51%
             
ASSET QUALITY RATIOS           
 Annualized Net Charge-offs to Average Loans0.04% 0.03% 0.30%
 Allowance for Loan Losses to Period End Loans0.60% 0.58% 0.67%
 Non-performing Assets to Period End Assets0.34% 0.34% 0.34%
 Non-performing Loans to Period End Loans0.46% 0.48% 0.49%
 Loans 30-89 Days Past Due to Period End Loans0.45% 0.54% 0.33%
       
SELECTED BALANCE SHEET & OTHER FINANCIAL DATA     
 Average Assets$3,886,723  $3,834,251  $3,120,971 
 Average Earning Assets$3,568,971  $3,495,618  $2,901,849 
 Average Total Loans$2,718,808  $2,662,502  $2,139,704 
 Average Demand Deposits$691,107  $714,504  $585,432 
 Average Interest Bearing Liabilities$2,708,307  $2,660,340  $2,150,544 
 Average Equity$464,234  $437,177  $363,579 
       
 Period End Non-performing Assets (3)$13,114  $13,498  $10,652 
 Period End Non-performing Loans (4)$12,429  $13,212  $10,584 
 Period End Loans 30-89 Days Past Due (5)$12,197  $14,815  $7,013 
       
 Tax Equivalent Net Interest Income$34,299  $33,702  $26,261 
 Net Charge-offs during Period$255  $228  $1,584 
       
(1)Efficiency Ratio is defined as Non-interest Expense divided by the sum of Net Interest Income, on a tax equivalent basis, and Non-interest Income.
(2)Net Overhead Expense is defined as Total Non-interest Expense less Total Non-interest Income.
(3)Non-performing assets are defined as Non-accrual Loans, Loans Past Due 90 days or more, Restructured Loans, and Other Real Estate Owned.
(4)Non-performing loans are defined as Non-accrual Loans, Loans Past Due 90 days or more, and Restructured Loans.
(5)Loans 30-89 days past due and still accruing.     

For additional information, contact:
Mark A Schroeder, Chairman & Chief Executive Officer of German American Bancorp, Inc.
Bradley M Rust, Executive Vice President/CFO of German American Bancorp, Inc.
(812) 482-1314

Source: German American Bancorp, Inc.