v3.26.3
BORROWINGS
 9 Months Ended
Sep. 30, 2026
Debt Disclosure [Abstract]  
BORROWINGS
BORROWINGS

The following table summarizes the Corporation’s borrowings as of September 30, 2026 and December 31, 2025.

September 30, 2026December 31, 2025
Federal funds purchased$— $40,000 
Securities sold under repurchase agreements99,638 103,755 
Federal Home Loan Bank advances903,941 798,549 
Subordinated notes, debentures and other borrowings184,505 57,630 
Total borrowings$1,188,084 $999,934 
Securities sold under repurchase agreements consist of obligations of the Bank to other parties and are secured by U.S. Government-sponsored enterprise obligations. The maximum amount of outstanding agreements at any month-end during the nine months ended September 30, 2026 and 2025 totaled $120.3 million and $169.1 million, respectively, and the average balance of such agreements totaled $108.9 million and $137.8 million during the same period of 2026 and 2025, respectively.

The following tables present the collateral pledged for repurchase agreements accounted for as secured borrowings as of September 30, 2026 and December 31, 2025:
September 30, 2026
Remaining Contractual Maturity of the Agreements
Overnight and ContinuousUp to 30 Days30-90 DaysGreater Than 90 DaysTotal
U.S. Government-sponsored mortgage-backed securities$99,638 $— $— $— $99,638 

December 31, 2025
Remaining Contractual Maturity of the Agreements
Overnight and ContinuousUp to 30 Days30-90 DaysGreater Than 90 DaysTotal
U.S. Government-sponsored mortgage-backed securities$103,755 $— $— $— $103,755 

Contractual maturities of borrowings as of September 30, 2026, are as follows:
Maturities in Years Ending December 31:Securities Sold
Under Repurchase Agreements		Federal Home
Loan Bank
Advances		Subordinated Notes,
Debentures and
Other Borrowings
2026$99,638 $330,000 $1,061 
2027— 320,000 — 
2028— 190,000 — 
2029— — — 
2030— — — 
2031 and after— 63,316 189,082 
Unamortized debt issuance costs and acquisition-related fair value adjustments— 625 (5,638)
$99,638 $903,941 $184,505 

At September 30, 2026, the outstanding Federal Home Loan Bank ("FHLB") advances had interest rates from 0 percent to 4.56 percent and are subject to restrictions or penalties in the event of prepayment. The total available remaining borrowing capacity from the FHLB at September 30, 2026, was $1.4 billion. As of September 30, 2026, the Corporation had $130.0 million of putable advances with the FHLB.
Subordinated Notes, Debentures and Other Borrowings. As of September 30, 2026 and December 31, 2025, subordinated debentures and other borrowings totaled $184.5 million and $57.6 million, respectively.

•First Merchants Capital Trust II (“FMC Trust II”). At September 30, 2026 and December 31, 2025, the Corporation had $41.7 million of subordinated debentures issued to FMC Trust II, a wholly-owned statutory business trust. FMC Trust II was formed in July 2007 for purposes of issuing trust preferred securities to investors. At that time, it simultaneously issued and sold its common securities to the Corporation, which constituted all of the issued and outstanding common securities of FMC Trust II. The subordinated debentures, which were purchased with the proceeds of the sale of the trust’s capital securities, are the sole assets of FMC Trust II and are fully and unconditionally guaranteed by the Corporation. As of September 30, 2026 and December 31, 2025, the subordinated debentures and trust preferred securities bear interest at a variable rate equal to the three-month CME Term Secured Overnight Financing Rate published by the Chicago Mercantile Exchange Group ("CME Term SOFR"), plus the 0.26161 percent spread adjustment. The interest rates at September 30, 2026 and December 31, 2025 were 5.72 percent and 5.54 percent, respectively. The trust preferred securities are currently redeemable at par and without penalty, subject to the Corporation having first redeemed the related subordinated debentures, with the prior approval of the Board of Governors of the Federal Reserve System ("Federal Reserve") if then required under applicable capital guidelines or policies. The trust preferred securities and the subordinated debentures of FMC Trust II will mature on September 15, 2037. The Corporation continues to hold all outstanding common securities of FMC Trust II.

•Ameriana Capital Trust I. At September 30, 2026 and December 31, 2025, the Corporation had $10.3 million of subordinated debentures issued to Ameriana Capital Trust I. On December 31, 2015, the Corporation acquired Ameriana Capital Trust I in conjunction with its acquisition of Ameriana Bancorp, Inc. With a trust preferred structure substantially similar to that described above for FMC Trust II, the subordinated debentures held by Ameriana Capital Trust I were purchased with the proceeds of the sale of the trust’s capital securities. As of September 30, 2026 and December 31, 2025, the subordinated debentures and trust preferred securities bear interest at a variable rate equal to the three-month CME Term SOFR, plus the 0.26161 percent spread adjustment. The interest rates at September 30, 2026 and December 31, 2025 were 5.66 percent and 5.48 percent, respectively. The trust preferred securities of Ameriana Capital Trust I are currently redeemable at par and without penalty, subject to the Corporation having first redeemed the related subordinated debentures, with the prior approval of the Federal Reserve if then required under applicable capital guidelines or policies. The trust preferred securities and the subordinated debentures of Ameriana Capital Trust I will mature in March 2036. The Corporation continues to hold all of the outstanding common securities of Ameriana Capital Trust I.

•First Savings Subordinated Notes. On February 1, 2026, the Corporation assumed certain subordinated notes in conjunction with its acquisition of First Savings. The subordinated notes assumed in the acquisition had an outstanding principal balance of $29.0 million at acquisition and were originally issued on March 18, 2022. The notes have a fixed interest rate of 4.50 percent per annum, payable semiannually through March 30, 2027. The notes have a floating interest rate equal to the three-month CME Term SOFR plus 2.76 percent, payable quarterly, after March 30, 2027 through maturity. The notes mature on March 30, 2032, and the Corporation has the option to redeem any or all of the subordinated notes without premium or penalty any time after March 30, 2027 or upon the occurrence of a Tier 2 capital event or tax event.

•6.75% Fixed-to-Floating Rate Subordinated Notes due 2036 ("2036 Notes"). On September 25, 2026, the Corporation issued $100.0 million of subordinated notes, which bear interest at a fixed annual rate of 6.75 percent through September 30, 2031. During the fixed-rate period, interest is payable semiannually. Beginning October 1, 2031, the interest rate will reset quarterly to a floating rate equal to the three-month CME Term SOFR plus 2.02 percent. During the floating-rate period, interest will be payable quarterly. The notes mature on October 1, 2036. Beginning October 1, 2031, the Corporation may redeem the notes, in whole or in part, at par plus accrued and unpaid interest, subject to prior regulatory approval to the extent required. The notes are unsecured subordinated obligations of the Corporation. Debt issuance costs of $1.9 million were recorded as a direct deduction from the principal amount of the notes and are being amortized to interest expense over the contractual term of the notes. The Corporation received net proceeds of approximately $98.1 million, after deducting underwriting discounts and other issuance costs.

•Other Borrowings. On April 1, 2022, the Corporation acquired a secured borrowing in conjunction with its acquisition of Level One. The secured borrowing related to a certain loan participation sold by Level One that did not qualify for sales treatment. The secured borrowing bears a fixed rate of 1.00 percent and had a balance of $1.1 million as of September 30, 2026 and December 31, 2025. During the third quarter of 2023, the Corporation acquired a secured borrowing in conjunction with the purchase of the Indianapolis regional headquarters building. The secured borrowing bears a fixed interest rate of 3.41 percent, has a maturity date of March 2035, and had a balance of $6.8 million and $7.0 million as of September 30, 2026 and December 31, 2025, respectively.

Line of Credit. As of September 30, 2026 and December 31, 2025, there was no outstanding balance on the line of credit.

•U.S. Bank, N.A. On September 30, 2024, the Corporation entered into a Credit Agreement with U.S. Bank, N.A. Under the terms of the Credit Agreement, U.S. Bank, N.A. has provided the Corporation with a revolving line of credit ("Credit Facility") of up to $75.0 million. The outstanding principal balance under the Credit Facility bears interest at a variable rate equal to the one-month CME Term SOFR rate plus 2.25 percent. Interest on the outstanding balance is payable quarterly. Additionally, the Corporation is subject to a non-refundable facility fee equal to 0.40 percent per annum on the average daily unused amount of the Credit Facility, payable quarterly. The Credit Agreement contains customary representations, warranties and covenants. During the third quarter of 2026, the Corporation amended the Credit Facility to extend the termination date from September 29, 2026 to September 28, 2027. As of September 30, 2026 and December 31, 2025, the Corporation's outstanding principal balance under the Credit Facility was zero and the Corporation was in compliance with all covenants.