FIRST FINANCIAL CORP /IN/
For the period ended Mar 31, 2026. Filed May 6, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 6, 2026
THFF$76.24-0.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-05.
0000714562-25-000062
Items 2 and 3. Management’s Discussion and Analysis of Financial Condition and Results of Operations and Quantitative and Qualitative Disclosures About Market RiskCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-06.
0000714562-26-000038
Items 2 and 3. Management’s Discussion and Analysis of Financial Condition and Results of Operations and Quantitative and Qualitative Disclosures About Market RiskThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 50 previous paragraphs and 51 current paragraphs.
38 unchanged; 12 reworded; 1 added; 0 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 7 previous and 9 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (1)
Current report
On March 1, 2026, First Financial Corporation completed the acquisition of CedarStone Financial, Inc. As a result of the acquisition, loans acquired were $292 million, and deposits acquired were $313 million. Additionally, we recorded a bargain purchase gain of $716 thousand. Net income will reflect one month of activity in the first quarter for activity from CedarStone. Included in the variances in the following discussion are the values provided in this paragraph.
Reworded paragraphs (12)
Previous wording
The ACL and allowance for unfunded commitments were $47.4 million and $2.2 million, respectively at September 30, 2025, compared to $46.7 million and $2.1 million, respectively at December 31, 2024. The qualitative amount of the reserve increased $1.1 million to $13.9 million. The quantitative amount is $33.1 million at September 30, 2025, compared to $33.6 million at December 31, 2024. There was an increase of $100 thousand in the allowance for unfunded commitments. See additional discussion of ACL in the Allowance for Credit Losses section below.
Current wording
The ACL and allowance for unfunded commitments were $52.3 million and $2.9 million, respectively at March 31, 2026, compared to $48.0 million and $2.9 million, respectively at December 31, 2025. The qualitative amount of the reserve increased $607 thousand to $14.7 million. The quantitative amount is $34.1 million at March 31, 2026, compared to $33.6 million at December 31, 2025. There was no change in the allowance for unfunded commitments. As a result of the acquisition of CedarStone Financial, Inc., the Corporation recorded an additional allowance for credit loss on loans of $3.3 million. See additional discussion of ACL in the Allowance for Credit Losses section below.
Previous wording
Net income for the three months ended September 30, 2025 was $20.8 million, compared to $8.7 million for the same period in 2024. Basic earnings per share increased to $1.75 for the third quarter of 2025 compared to $0.74 for the same period in 2024. Return on average assets and return on average equity were 1.48% and 13.82% respectively, for the three months ended September 30, 2025 compared to 0.64% and 6.39% for the three months ended September 30, 2024. Net income for the nine months ended September 30, 2025 was $57.8 million, compared to $31.0 million for the same period in 2024. Basic earnings per share increased to $4.87 for the nine months of 2025 compared to $2.63 for the same period in 2024. Return on average assets and return on average equity were 1.39% and 13.23% respectively, for the nine months ended September 30, 2025 compared to 0.82% and 7.80% for the nine months ended September 30, 2024.
Current wording
Net income for the three months ended March 31, 2026 was $19.8 million, compared to $18.4 million for the same period in 2025. Basic earnings per share increased to $1.67 for the first quarter of 2026 compared to $1.55 for the same period in 2025. Return on average assets and return on average equity were 1.35% and 11.93% respectively, for the three months ended March 31, 2026 compared to 1.34% and 13.04% for the three months ended March 31, 2025.
Previous wording
The Corporation’s primary source of earnings is net interest income, which is the difference between the interest earned on loans and other investments and the interest paid for deposits and other sources of funds. Net interest income increased $7.4 million in the three months ended September 30, 2025 to $54.6 million from $47.2 million in the same period in 2024. The net interest margin for the three months ended September 30, 2025 is 4.25% compared to 3.78% for the same period in 2024, a 12.42% increase. Net interest income increased $33.9 million in the nine months ended September 30, 2025 to $159.2 million from $125.4 million in the same period in 2024. The net interest margin for the nine months ended September 30, 2025 is 4.17% compared to 3.63% for the same period in 2024, a 14.98% increase.
Current wording
The Corporation’s primary source of earnings is net interest income, which is the difference between the interest earned on loans and other investments and the interest paid for deposits and other sources of funds. Net interest income increased $4.9 million in the three months ended March 31, 2026 to $56.9 million from $52.0 million in the same period in 2025. The net interest margin for the three months ended March 31, 2026 is 4.23% compared to 4.11% for the same period in 2025, a 2.90% increase.
Previous wording
The increase in yields on net loans and leases of 24 basis points is the primary contributor to the improved yield on average earning assets for the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024. Comparing the nine months ended September 30, 2025 to the nine months ended September 30, 2024, the effective rate paid on average interest-bearing deposits decreased 23 basis points. For the same period discussed above, interest paid on other borrowings decreased 93 basis points.
Current wording
The increase in yields on investments of 31 basis points is the primary contributor to the improved yield on average earning assets for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. Comparing the three months ended March 31, 2026 to the three months ended March 31, 2025, the effective rate paid on average interest-bearing deposits decreased 11 basis points. For the same period discussed above, interest paid on other borrowings decreased 117 basis points.
Previous wording
Non-interest income for the three months ended September 30, 2025 was $11.1 million compared to $11.2 million for the same period in 2024. Non-interest income for the nine months ended September 30, 2025 was $32.0 million compared to $30.6 million for the same period in 2024.
Current wording
Non-interest income for the three months ended March 31, 2026 was $11.2 million compared to $10.5 million for the same period in 2025.
Previous wording
The Corporation’s non-interest expense for the quarter ended September 30, 2025 was $38.0 million compared to $38.6 million for the same period in 2024. The Corporation’s non-interest expense for the nine months ended September 30, 2025 increased $8.4 million to $113.1 million compared to the same period in 2024. This includes an overall increase in operating expenses as a result of the acquisition.
Current wording
The Corporation’s non-interest expense for the quarter ended March 31, 2026 was $40.9 million compared to $36.8 million for the same period in 2025. This includes an overall increase in operating expenses as a result of the acquisition.
Previous wording
The Corporation’s provision for credit losses for the three months ended September 30, 2025, was $2.0 million, compared to provision of $9.4 million for the same period of 2024. Net charge-offs for the third quarter of 2025 were $1.6 million compared to net charge-offs of $4.6 million for the same period of 2024. The provision for credit losses decreased $8.3 million to $5.9 million for the nine months ended September 30, 2025, compared to a provision of $14.2 million for the same period in 2024. Net charge-offs for the first nine months of 2025 decreased $5.6 million to $5.2 million compared to the same period of 2024. The Corporation recorded $5.5 million in provision on non-PCD loans acquired from SimplyBank subsequent to the acquisition in the third quarter 2024. Also in the third quarter 2024, additional provision as well as charge-offs were related to one previously identified credit, reflecting further deterioration in collateral values in the third quarter 2024. No further losses were recorded on this credit. Based on management’s analysis of the current portfolio, an evaluation that includes consideration of changes in CECL model assumptions of credit quality, economic conditions, and loan composition, management believes the allowance is adequate. In the first nine months of 2025, no significant changes were made.
Current wording
The Corporation’s provision for credit losses for the three months ended March 31, 2026, was $2.6 million, compared to provision of $2.0 million for the same period of 2025. Net charge-offs for the first quarter of 2026 were $1.5 million compared to net charge-offs of $1.8 million for the same period of 2025. Based on management’s analysis of the current portfolio, an evaluation that includes consideration of changes in CECL model assumptions of credit quality, economic conditions, and loan composition, management believes the allowance is adequate. In the first three months of 2026, no significant changes were made.
Previous wording
The Corporation’s effective income tax rate for the first nine months of 2025 was 20.18% compared to 16.44% for the same period in 2024. Pretax income for the first nine months in 2025 was significantly higher than pretax income for first nine months in 2024. Since our permanent differences remained similar, income was the driving factor for the increase in effective tax rate.
Current wording
The Corporation’s effective income tax rate for the first three months of 2026 was 19.89% compared to 22.59% for the same period in 2025.
Previous wording
Non-performing loans consist of (1) non-accrual loans on which the ultimate collectability of the full amount of interest is uncertain, and (2) loans past due ninety days or more as to principal or interest. Non-performing loans increased to $19.3 million at September 30, 2025 compared to $13.3 million at December 31, 2024. Nonperforming loans increased 36.3% compared to $14.1 million as of September 30, 2024.
Current wording
Non-performing loans consist of (1) non-accrual loans on which the ultimate collectability of the full amount of interest is uncertain, and (2) loans past due ninety days or more as to principal or interest. Non-performing loans decreased to $28.5 million at March 31, 2026 compared to $28.6 million at December 31, 2025. Nonperforming loans increased 179.9% compared to $10.2 million as of March 31, 2025.
Previous wording
The table below shows the Corporation’s estimated sensitivity profile as of September 30, 2025. The change in interest rates assumes a parallel shift in interest rates of 100, 200, and 300 basis points. Given a 100 basis point increase in rates, net interest income would decrease 1.80% over the next 12 months and increase 1.17% over the following 12 months. Given a 100 basis point decrease in rates, net interest income would increase 3.99% over the next 12 months and increase 0.57% over the following 12 months. These estimates assume all rate changes occur overnight and management takes no action as a result of this change.
Current wording
The table below shows the Corporation’s estimated sensitivity profile as of March 31, 2026. The change in interest rates assumes a parallel shift in interest rates of 100, 200, and 300 basis points. Given a 100 basis point increase in rates, net interest income would decrease 1.75% over the next 12 months and increase 1.29% over the following 12 months. Given a 100 basis point decrease in rates, net interest income would increase 3.79% over the next 12 months and increase 0.21% over the following 12 months. These estimates assume all rate changes occur overnight and management takes no action as a result of this change.
Previous wording
Liquidity represents an institution’s ability to provide funds to satisfy demands from depositors, borrowers, and other creditors by either converting assets into cash or accessing new or existing sources of incremental funds. Generally the Corporation relies on deposits, loan repayments and repayments of investment securities as its primary sources of funds. The Corporation has $11.9 million of investments that mature throughout the next 12 months. The Corporation also anticipates $108.7 million of principal payments from mortgage-backed and other securities. Given the current rate environment, the Corporation anticipates $29.2 million in securities to be called within the next 12 months. The Corporation also has $203.1 million of unused borrowing capacity available with the Federal Home Loan Bank of Indianapolis, $898 million available with the Federal Reserve Bank, and $90 million of available fed funds lines with correspondent banks. With these sources of funds, the Corporation currently anticipates adequate liquidity to meet the expected obligations of its customers.
Current wording
Liquidity represents an institution’s ability to provide funds to satisfy demands from depositors, borrowers, and other creditors by either converting assets into cash or accessing new or existing sources of incremental funds. Generally the Corporation relies on deposits, loan repayments and repayments of investment securities as its primary sources of funds. The Corporation has $7.9 million of investments that mature throughout the next 12 months. The Corporation also anticipates $119.0 million of principal payments from mortgage-backed and other securities. Given the current rate environment, the Corporation anticipates $62.0 million in securities to be called within the next 12 months. The Corporation also has $162.7 million of unused borrowing capacity available with the Federal Home Loan Bank of Indianapolis, $891 million available with the Federal Reserve Bank, and $90 million of available fed funds lines with correspondent banks. With these sources of funds, the Corporation currently anticipates adequate liquidity to meet the expected obligations of its customers.
Previous wording
Comparing the first nine months of 2025 to year-ended December 31, 2024, loans net of deferred loan costs, have increased $130 million to $4.0 billion. Deposits decreased 2.2% to $4.6 billion at September 30, 2025 compared to December 31, 2024. Other borrowings increased $142.3 million to $170.5 million at September 30, 2025 compared to December 31, 2024. Shareholders’ equity increased 13.33% or $73.2 million. This financial performance increased book value per share 13.24% to $52.50 at September 30, 2025 from $46.36 at December 31, 2024. Book value per share is calculated by dividing the total shareholders’ equity by the number of shares outstanding. Accumulated other comprehensive loss increased $33.7 million primarily due to the market value of the securities portfolio, which reflected the increase in securities pricing.
Current wording
Comparing the first three months of 2026 to year-ended December 31, 2025, loans net of deferred loan costs, have increased $369 million to $4.4 billion. Deposits increased 6.4% to $4.8 billion at March 31, 2026 compared to December 31, 2025. Other borrowings increased $20.5 million to $208.8 million at March 31, 2026 compared to December 31, 2025. Shareholders’ equity increased 0.68% or $4.4 million. This financial performance increased book value per share 0.58% to $55.10 at March 31, 2026 from $54.78 at December 31, 2025. Book value per share is calculated by dividing the total shareholders’ equity by the number of shares outstanding. Accumulated other comprehensive loss decreased $8.6 million primarily due to the market value of the securities portfolio, which reflected the decrease in securities pricing.