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

JASPER, Ind., July 29, 2019 (GLOBE NEWSWIRE) -- German American Bancorp, Inc. (GABC) reported record quarterly earnings of $15.3 million, or $0.61 per share, for the quarter ending on June 30, 2019.  This level of quarterly earnings performance was an increase of 27%, on a per share basis, compared with the second quarter 2018 net income of $11.1 million, or $0.48 per share. The current quarter earnings also compared favorably with the first quarter 2019 net income of $15.1 million, or $0.60 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. of Owensboro, Kentucky on October 15, 2018.  The Company had also previously announced the completion of its acquisition of Citizens First Corporation of Bowling Green, Kentucky as of July 1, 2019.  Acquisition-related expenses from these transactions were included in the expenses in each of the quarterly period comparisons.

On a linked-quarter basis, the record second quarter 2019 earnings were attributable to a variety of factors, including an increased level of net interest income, improved levels of non-interest income within a majority of the categories of fee income and additional net gains on the sale of loans and securities.  As compared to the first quarter of 2019, the Company also benefited from a reduction in the level of provision for loan loss resulting from an improved level of asset quality.  Additionally, operating expenses were lower in the current quarter due to reduced levels of salaries and benefits expense and professional fees during the current quarter.

Other factors offsetting a portion of the positive quarter-over-quarter comparison, on a linked-quarter basis, included the recording of $1.4 million in insurance contingency revenue, $554,000 in bank-owned life insurance benefits, and a $262,000 gain on the sale of a former branch facility during the first quarter of 2019.

The Company also recorded strong deposit growth during the second quarter, as end of period total deposits grew by approximately $63.7 million, or approximately 8% on a linked-quarter annualized basis, and total non-maturity transaction deposits grew by approximately $100.2 million, or 16% on a linked-quarter annualized basis.  Additionally, the Company experienced a strong level of loan originations during the current quarter, which was materially offset by a continued elevated level of loan pay-offs, resulting in a modest increase of  $8.3 million, or  1%, on a linked-quarter annualized basis, in end of period total loans.

Commenting on the Company’s performance, Mark A. Schroeder, German American’s Chairman & CEO, stated, "We’re pleased with the extremely strong start we experienced during the first half of this year, in terms of record earnings, exceptional deposit growth and the exceptionally strong loan pipelines we continue to experience throughout our footprint.  Even though the current economic recovery is at a historic length, the economic strength and vitality in each of the markets we serve continues to be impressive.  Based on these factors, we are encouraged about our ability to continue the level of exceptional performance we’ve been able to deliver during the current quarter, year-to-date and over the course of the past decade.”

The Company also announced its Board of Directors declared a regular quarterly cash dividend of $0.17 per share, which will be payable on August 20, 2019 to shareholders of record as of August 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 $3.971 billion at June 30, 2019, representing an increase of $75.2 million, or 8% on an annualized basis, compared with March 31, 2019 and an increase of $626.2 million, or 19%, compared with June 30, 2018.  The increase in total assets as of June 30, 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.

June 30, 2019 total loans increased $8.3 million, or 1% on an annualized basis, compared with March 31, 2019 and increased $398.8 million, or 17%, compared with June 30, 2018.

The modest increase during the second quarter of 2019 was driven by a seasonal increase in agricultural loans of approximately $16.1 million, or 19% on an annualized basis, which was partially mitigated by a decline in retail loans of $7.7 million, or 5% on an annualized basis, driven primarily by a decline in residential real estate loans.

             
End of Period Loan Balances   6/30/2019   3/31/2019   6/30/2018
(dollars in thousands)            
             
Commercial & Industrial Loans   $ 554,290     $ 555,967     $ 518,299  
Commercial Real Estate Loans   1,213,579     1,212,090     986,486  
Agricultural Loans   364,116     347,999     352,308  
Consumer Loans   280,963     281,724     241,315  
Residential Mortgage Loans   307,726     314,634     223,437  
    $ 2,720,674     $ 2,712,414     $ 2,321,845  
             

Non-performing assets totaled $12.5 million at June 30, 2019 compared to $13.1 million at March 31, 2019 and $9.5 million at June 30, 2018.  Non-performing assets represented 0.32% of total assets at June 30, 2019, 0.34% at March 31, 2019,  and 0.28% at June 30, 2018.  Non-performing loans totaled $11.9 million at June 30, 2019 compared to $12.4 million at March 31, 2019 and $9.5 million at June 30, 2018.  Non-performing loans represented 0.44% of total loans at June 30, 2019 compared to 0.46% at March 31, 2019 and 0.41% at June 30, 2018.

           
Non-performing Assets          
(dollars in thousands)          
  6/30/2019   3/31/2019   6/30/2018
Non-Accrual Loans $ 10,929     $ 12,036     $ 8,953  
Past Due Loans (90 days or more) 959     393     534  
Total Non-Performing Loans 11,888     12,429     9,487  
Other Real Estate 635     685     40  
Total Non-Performing Assets $ 12,523     $ 13,114     $ 9,527  
           
Restructured Loans $ 118     $ 119     $ 123  
           

The Company’s allowance for loan losses totaled $16.2 million at June 30, 2019 compared to $16.2 million at March 31, 2019 and $15.6 million at June 30, 2018.  The allowance for loan losses represented 0.60% of period-end loans at June 30, 2019 compared with 0.60% of period-end loans at March 31, 2019 and 0.67% of period-end loans at June 30, 2018.  From time to time, the Company has acquired loans through bank and branch acquisitions with the most recent (reflected in actual results) 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 $17.1 million at June 30, 2019, $18.2 million at March 31, 2019 and $9.6 million at June 30, 2018.

June 30, 2019 total deposits increased $63.7 million, or 8% on an annualized basis, compared with March 31, 2019 and increased $527.4 million, or 20%, compared with June 30, 2018.  The increase in total deposits in the second quarter of 2019, compared with the first quarter of 2019, was largely related to seasonal increases in public fund operating accounts.

             
End of Period Deposit Balances   6/30/2019   3/31/2019   6/30/2018
(dollars in thousands)            
             
Non-interest-bearing Demand Deposits   $ 725,367     $ 723,995     $ 629,724  
IB Demand, Savings, and MMDA Accounts   1,805,694     1,706,913     1,611,583  
Time Deposits < $100,000   248,744     248,686     190,179  
Time Deposits > $100,000   349,027     385,576     169,954  
    $ 3,128,832     $ 3,065,170     $ 2,601,440  
             

Results of Operations Highlights – Quarter ended June 30, 2019

Net income for the quarter ended June 30, 2019 totaled $15,271,000, or $0.61 per share, an increase of 2% on a per share basis compared with the first quarter 2019 net income of $15,067,000, or $0.60 per share, and an  increase of 27% on a per share basis compared with the second quarter 2018 net income of $11,097,000, or $0.48 per share.  The change in net income during the second quarter of 2019, compared with the second quarter of 2018, was impacted by the completed acquisition activity during 2018.  A detailed analysis of the factors impacting second quarter 2019 income and expenses, as compared to first quarter 2019, is included in the remaining discussion.

Net income for each quarter presented was impacted by merger and acquisition activity during 2018 and 2019.  The second quarter of 2019 results of operations included acquisition-related expenses of approximately $428,000 ($369,000 or $0.01 per share, on an after tax basis), while the first quarter of 2019 results of operations included acquisition-related expenses of approximately $544,000 ($432,000 or $0.02 per share, on an after tax basis) and the second quarter of 2018 included approximately $903,000 ($727,000 or $0.03 per share on an after tax basis).

                                     
Summary Average Balance Sheet                                    
(Tax-equivalent basis / dollars in thousands)                                    
     Quarter Ended    Quarter Ended    Quarter Ended
    June 30, 2019   March  31, 2019   June 30, 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   $ 21,257     $ 85     1.62 %   $ 24,538     $ 141     2.32 %   $ 12,939     $ 54     1.68 %
Securities   842,282     6,529     3.10 %   825,625     6,549     3.17 %   751,367     5,758     3.07 %
Loans and Leases   2,721,630     35,135     5.18 %   2,718,808     35,207     5.24 %   2,229,972     26,394     4.75 %
Total Interest Earning Assets   $ 3,585,169     $ 41,749     4.67 %   $ 3,568,971     $ 41,897     4.74 %   $ 2,994,278     $ 32,206     4.31 %
                                                                   
Liabilities                                                                  
Demand Deposit Accounts   $ 715,681                   $ 691,107                   $ 625,158                
IB Demand, Savings, and                                                                  
MMDA Accounts   $ 1,797,228     $ 2,945     0.66 %   $ 1,731,118     $ 2,695     0.63 %   $ 1,560,838     $ 1,597     0.41 %
Time Deposits   631,174     2,814     1.79 %   646,726     2,721     1.71 %   417,585     1,251     1.20 %
FHLB Advances and Other Borrowings   246,229     1,636     2.67 %   330,463     2,182     2.68 %   238,775     1,216     2.04 %
Total Interest-Bearing Liabilities   $ 2,674,632     $ 7,395     1.11 %   $ 2,708,307     $ 7,598     1.14 %   $ 2,217,198     $ 4,064     0.74 %
                                     
Cost of Funds           0.83 %           0.86 %           0.54 %
Net Interest Income       $ 34,354             $ 34,299             $ 28,142      
Net Interest Margin           3.84 %           3.88 %           3.77 %
                                     

During the quarter ended June 30, 2019, net interest income totaled $33,641,000, which was relatively flat to the quarter ended March 31, 2019 net interest income of $33,591,000.  The increased level of net interest income during the second quarter of 2019 compared with the first quarter of 2019 was driven primarily by a modestly higher level of average earning assets combined with an additional day during the second quarter partially mitigated by a modest decline in the stated tax equivalent net interest margin.

The tax equivalent net interest margin for the quarter ended June 30, 2019 was 3.84% compared with 3.88% in the first quarter of 2019.  Accretion of loan discounts on acquired loans contributed approximately 12 basis points to the net interest margin on an annualized basis in the second quarter of 2019 and 16 basis points in the first quarter of 2019.

During the quarter ended June 30, 2019, the Company recorded a provision for loan loss of $250,000 compared with $675,000 in the first quarter of 2019.  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 June 30, 2019, non-interest income totaled $10,509,000, a decline of $1,149,000, or 10%, compared with the quarter ended March 31, 2019.

             
    Quarter Ended   Quarter Ended   Quarter Ended
Non-interest Income   6/30/2019   3/31/2019   6/30/2018
(dollars in thousands)            
             
Trust and Investment Product Fees   $ 1,913     $ 1,567     $ 1,677  
Service Charges on Deposit Accounts   2,024     1,900     1,643  
Insurance Revenues   1,929     3,205     1,696  
Company Owned Life Insurance   304     884     260  
Interchange Fee Income   2,332     2,095     1,714  
Other Operating Income   461     871     913  
Subtotal   8,963     10,522     7,903  
Net Gains on Loans   1,030     981     905  
Net Gains on Securities   516     155     74  
Total Non-interest Income   $ 10,509     $ 11,658     $ 8,882  
             

Trust and investment product fees increased $346,000, or 22%, during the second quarter of 2019 compared with the first quarter of 2019.  The increase during the second quarter of 2019 was largely attributable to increased assets under management and increased activity in the Company's wealth management group.

Insurance revenues declined $1,276,000, or 40%, during the quarter ended June 30, 2019, compared with the first quarter of 2019.  The decline during the second quarter of 2019 compared with the first quarter of 2019 was primarily due to contingency revenue.  Contingency revenue during the first quarter of 2019 totaled $1,375,000 compared with no contingency revenue during the second quarter of 2019.  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 declined $580,000, or 66%, during the quarter ended June 30, 2019, compared with the first quarter of 2019. The increase was largely related to death benefits of $554,000 received from life insurance policies during the first quarter of  2019.

Interchange fees increased $237,000, or 11%, during the second quarter of 2019 compared with the first quarter of 2019.  The increase during the second quarter of 2019 compared with the first quarter of 2019 was largely attributable to increased card utilization by customers.

Other operating income declined $410,000, or 47%, during the quarter ended June 30, 2019 compared with the first quarter of 2019.  The decline during the second quarter of 2019 compared with the first quarter of 2019 was largely attributable to a gain realized on the sale of a former branch facility of $262,000 during the first quarter of 2019.

The Company realized $516,000 in gains on sales of securities during the second quarter of 2019 compared with $155,000 during the first quarter of 2019.

During the quarter ended June 30, 2019, non-interest expense totaled $25,618,000, a decline of $1,141,000, or 4%, compared with the quarter ended March 31, 2019.  The second quarter of 2019 included acquisition-related expenses of $428,000 while the first quarter of 2019 included acquisition-related expenses of approximately $544,000.

             
    Quarter Ended   Quarter Ended   Quarter Ended
Non-interest Expense   6/30/2019   3/31/2019   6/30/2018
(dollars in thousands)            
             
Salaries and Employee Benefits   $ 14,117     $ 15,044     $ 12,019  
Occupancy, Furniture and Equipment Expense   3,212     3,219     2,527  
FDIC Premiums   245     288     238  
Data Processing Fees   1,803     1,583     1,398  
Professional Fees   1,174     1,327     1,361  
Advertising and Promotion   936     870     857  
Intangible Amortization   802     843     306  
Other Operating Expenses   3,329     3,585     3,002  
Total Non-interest Expense   $ 25,618     $ 26,759     $ 21,708  
             

Salaries and benefits declined $927,000, or 6%, during the quarter ended June 30, 2019 compared with the first quarter of 2019.  The decline in salaries and benefits during the second quarter of 2019 compared with the first quarter of 2019 was primarily attributable to a reduced level of incentive compensation expense and a reduced level of other employee benefit expense.

Data processing fees increased $220,000, or 14%, during the second quarter of 2019 compared with the first quarter of 2019.  The increase during the second quarter of 2019 compared with the first quarter of 2019 was driven by acquisition-related costs which totaled approximately $214,000 during the second quarter of 2019.

Professional fees declined $153,000, or 12%, during the second quarter of 2019 compared with the first quarter of 2019.  The decline during the second quarter of 2019 compared to the first quarter of 2019 was due in large part to a decline in professional fees related to merger and acquisition activity partially offset by an increase in other professional fees primarily associated with the Company's annual shareholders' meeting.  Merger and acquisition-related professional fees totaled approximately $205,000 during the second quarter of 2019 compared with $508,000 in the first quarter of 2019.

About German American

German American Bancorp, Inc. is a NASDAQ-traded (GABC) bank holding company based in Jasper, Indiana.  German American, through its banking subsidiary German American Bank, operates 75 banking offices in 20 contiguous southern Indiana counties, six counties in Kentucky and one county in Tennessee.  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
           
  June 30, 2019   March 31, 2019   June 30, 2018
ASSETS          
Cash and Due from Banks $ 48,634     $ 45,038     $ 60,244  
Short-term Investments 41,623     14,740     11,038  
Investment Securities 841,045     824,950     739,834  
           
Loans Held-for-Sale 14,184     8,586     9,552  
           
Loans, Net of Unearned Income 2,717,028     2,708,832     2,318,510  
Allowance for Loan Losses (16,239 )   (16,243 )   (15,637 )
Net Loans 2,700,789     2,692,589     2,302,873  
           
Stock in FHLB and Other Restricted Stock 13,048     13,048     13,048  
Premises and Equipment 89,413     89,600     66,641  
Goodwill and Other Intangible Assets 113,309     112,920     65,978  
Other Assets 108,694     94,053     75,336  
TOTAL ASSETS $ 3,970,739     $ 3,895,524     $ 3,344,544  
           
LIABILITIES          
Non-interest-bearing Demand Deposits $ 725,367     $ 723,995     $ 629,724  
Interest-bearing Demand, Savings, and Money Market Accounts 1,805,694     1,706,913     1,611,583  
Time Deposits 597,771     634,262     360,133  
Total Deposits 3,128,832     3,065,170     2,601,440  
           
Borrowings 305,940     317,480     354,803  
Other Liabilities 36,556     33,687     17,761  
TOTAL LIABILITIES 3,471,328     3,416,337     2,974,004  
           
SHAREHOLDERS' EQUITY          
Common Stock and Surplus 254,935     254,625     188,885  
Retained Earnings 233,269     222,246     194,994  
Accumulated Other Comprehensive Income (Loss) 11,207     2,316     (13,339 )
SHAREHOLDERS' EQUITY 499,411     479,187     370,540  
           
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 3,970,739     $ 3,895,524     $ 3,344,544  
           
END OF PERIOD SHARES OUTSTANDING 24,992,238     24,992,238     22,967,898  
           
TANGIBLE BOOK VALUE PER SHARE (1) $ 15.45     $ 14.66     $ 13.26  
           
 
(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   Six Months Ended
    June 30, 2019   March 31, 2019   June 30, 2018   June 30, 2019   June 30, 2018
INTEREST INCOME                  
Interest and Fees on Loans $ 35,046     $ 35,119     $ 26,308     $ 70,165     $ 50,258  
Interest on Short-term Investments 85     141     54     226     110  
Interest and Dividends on Investment Securities 5,905     5,929     5,171     11,834     10,310  
TOTAL INTEREST INCOME 41,036     41,189     31,533     82,225     60,678  
                     
INTEREST EXPENSE                  
Interest on Deposits 5,759     5,416     2,848     11,175     5,131  
Interest on Borrowings 1,636     2,182     1,216     3,818     2,468  
TOTAL INTEREST EXPENSE 7,395     7,598     4,064     14,993     7,599  
                     
NET INTEREST INCOME 33,641     33,591     27,469     67,232     53,079  
Provision for Loan Losses 250     675     1,220     925     1,570  
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 33,391     32,916     26,249     66,307     51,509  
                     
NON-INTEREST INCOME                  
Net Gain on Sales of Loans 1,030     981     905     2,011     1,555  
Net Gain on Securities 516     155     74     671     344  
Other Non-interest Income 8,963     10,522     7,903     19,485     16,475  
TOTAL NON-INTEREST INCOME 10,509     11,658     8,882     22,167     18,374  
                     
NON-INTEREST EXPENSE                  
Salaries and Benefits 14,117     15,044     12,019     29,161     24,145  
Other Non-interest Expenses 11,501     11,715     9,689     23,216     18,018  
TOTAL NON-INTEREST EXPENSE 25,618     26,759     21,708     52,377     42,163  
                     
Income before Income Taxes 18,282     17,815     13,423     36,097     27,720  
Income Tax Expense 3,011     2,748     2,326     5,759     4,810  
                     
NET INCOME $ 15,271     $ 15,067     $ 11,097     $ 30,338     $ 22,910  
                     
BASIC EARNINGS PER SHARE $ 0.61     $ 0.60     $ 0.48     $ 1.21     $ 1.00  
DILUTED EARNINGS PER SHARE $ 0.61     $ 0.60     $ 0.48     $ 1.21     $ 1.00  
                     
WEIGHTED AVERAGE SHARES OUTSTANDING 24,992,238     24,971,863     22,968,178     24,982,107     22,954,367  
DILUTED WEIGHTED AVERAGE SHARES OUTSTANDING 24,992,238     24,971,863     22,968,178     24,982,107     22,954,367  
                     
                     


GERMAN AMERICAN BANCORP, INC.
(unaudited, dollars in thousands except per share data)
                       
      Three Months Ended   Six Months Ended
      June 30,   March 31,   June 30,   June 30,   June 30,
      2019   2019   2018   2019   2018
EARNINGS PERFORMANCE RATIOS                    
  Annualized Return on Average Assets   1.56 %   1.55 %   1.38 %   1.56 %   1.44 %
  Annualized Return on Average Equity   12.60 %   12.98 %   12.15 %   12.78 %   12.57 %
  Net Interest Margin   3.84 %   3.88 %   3.77 %   3.86 %   3.71 %
  Efficiency Ratio (1)   57.10 %   58.23 %   58.63 %   57.67 %   57.93 %
  Net Overhead Expense to Average Earning Assets (2)   1.69 %   1.69 %   1.71 %   1.69 %   1.61 %
                                           
ASSET QUALITY RATIOS                                        
  Annualized Net Charge-offs to Average Loans   0.04 %   0.04 %   0.01 %   0.04 %   0.15 %
  Allowance for Loan Losses to Period End Loans   0.60 %   0.60 %   0.67 %        
  Non-performing Assets to Period End Assets   0.32 %   0.34 %   0.28 %        
  Non-performing Loans to Period End Loans   0.44 %   0.46 %   0.41 %        
  Loans 30-89 Days Past Due to Period End Loans   0.39 %   0.45 %   0.52 %        
                                           
SELECTED BALANCE SHEET & OTHER FINANCIAL DATA                                        
  Average Assets   $ 3,908,669     $ 3,886,723     $ 3,226,091     $ 3,897,757     $ 3,173,821  
  Average Earning Assets   $ 3,585,169     $ 3,568,971     $ 2,994,278     $ 3,577,115     $ 2,948,319  
  Average Total Loans   $ 2,721,630     $ 2,718,808     $ 2,229,972     $ 2,720,227     $ 2,185,087  
  Average Demand Deposits   $ 715,681     $ 691,107     $ 625,158     $ 703,462     $ 605,405  
  Average Interest Bearing Liabilities   $ 2,674,632     $ 2,708,307     $ 2,217,198     $ 2,691,376     $ 2,184,055  
  Average Equity   $ 484,891     $ 464,234     $ 365,197     $ 474,619     $ 364,392  
                                           
  Period End Non-performing Assets (3)   $ 12,523     $ 13,114     $ 9,527          
  Period End Non-performing Loans (4)   $ 11,888     $ 12,429     $ 9,487          
  Period End Loans 30-89 Days Past Due (5)   $ 10,605     $ 12,197     $ 12,146          
                       
  Tax Equivalent Net Interest Income   $ 34,354     $ 34,299     $ 28,142     $ 68,653     $ 54,403  
  Net Charge-offs during Period   $ 254     $ 255     $ 43     $ 509     $ 1,627  
                       
(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, and Other Real Estate Owned.        
(4) Non-performing loans are defined as Non-accrual Loans and Loans Past Due 90 days or more.        
(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