Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
☑
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For The Quarterly Period Ended March 31, 2026
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 0-16759
FIRST FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
Indiana
35-1546989
(State or other jurisdiction
(I.R.S. Employer
incorporation or organization)
Identification No.)
One First Financial Plaza, Terre Haute, IN
47807
(Address of principal executive office)
(Zip Code)
(812)
238-6000
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol
Name of each exchange on which registered
Common Stock, par value $0.125 per share
THFF
The NASDAQ Stock Market LLC
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 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 ☑ No ☐.
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☑ No ☐.
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Accelerated filer
Non-accelerated filer (Do not check if a smaller reporting company)
Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☐ No ☑.
As of May 1, 2026, the registrant had outstanding 11,891,896 shares of common stock, without par value.
INDEX
Page No.
PART I. Financial Information
Item 1. Financial Statements:
Consolidated Balance Sheets
3
Consolidated Statements of Income and Comprehensive Income
4
Consolidated Statements of Shareholders’ Equity
5
Consolidated Statements of Cash Flows
6
Notes to Consolidated Financial Statements
7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
36
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Item 4. Controls and Procedures
42
PART II. Other Information:
Item 1. Legal Proceedings
43
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
44
Signatures
45
2
Part I – Financial Information
Item 1.Financial Statements
CONSOLIDATED BALANCE SHEETS
(Dollar amounts in thousands, except per share data)
December 31,
2026
2025
ASSETS
Cash and due from banks
$
96,887
130,369
Federal funds sold
—
475
Securities available-for-sale
1,170,768
1,149,526
Loans:
Commercial
2,410,989
2,375,344
Residential
1,301,666
986,955
Consumer
703,322
688,135
4,415,977
4,050,434
(Less) plus:
Net deferred loan (fees)/costs
7,944
4,869
Allowance for credit losses
(52,338)
(47,995)
4,371,583
4,007,308
Restricted stock
18,553
18,536
Accrued interest receivable
27,881
27,762
Premises and equipment, net
88,692
78,582
Bank-owned life insurance
136,453
131,286
Goodwill
98,229
Other intangible assets
20,400
16,234
Other real estate owned
184
94
Other assets
98,959
97,725
TOTAL ASSETS
6,128,589
5,756,126
LIABILITIES AND SHAREHOLDERS’ EQUITY
Deposits:
Non-interest-bearing
1,139,666
916,473
Interest-bearing:
Certificates of deposit exceeding the FDIC insurance limits
135,035
135,605
Other interest-bearing deposits
3,567,685
3,499,033
4,842,386
4,551,111
Short-term borrowings
349,781
292,468
Other borrowings
208,756
188,208
Other liabilities
72,378
73,470
TOTAL LIABILITIES
5,473,301
5,105,257
Shareholders’ equity
Common stock, $0.125 stated value per share; Authorized shares - 40,000,000; Issued shares-16,206,804 in 2026 and 16,190,157 in 2025; Outstanding shares - 11,891,896 in 2026 and 11,880,759 in 2025
2,021
Additional paid-in capital
147,643
147,442
Retained earnings
754,938
741,793
Accumulated other comprehensive loss
(95,276)
(86,681)
Less: Treasury shares at cost - 4,314,908 in 2026 and 4,309,398 in 2025
(154,038)
(153,706)
TOTAL SHAREHOLDERS’ EQUITY
655,288
650,869
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
See accompanying notes.
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
Three Months Ended
March 31,
(unaudited)
INTEREST INCOME:
Loans, including related fees
67,521
63,612
Securities:
Taxable
6,536
6,002
Tax-exempt
2,864
2,604
Other
1,025
814
TOTAL INTEREST INCOME
77,946
73,032
INTEREST EXPENSE:
Deposits
16,629
18,199
2,352
1,693
2,032
1,165
TOTAL INTEREST EXPENSE
21,013
21,057
NET INTEREST INCOME
56,933
51,975
Provision for credit losses
2,550
1,950
NET INTEREST INCOME AFTER PROVISION
FOR CREDIT LOSSES
54,383
50,025
NON-INTEREST INCOME:
Trust and financial services
1,491
1,393
Service charges and fees on deposit accounts
7,382
7,585
Other service charges and fees
374
316
Securities gains (losses), net
Interchange income
186
214
Loan servicing fees
326
165
Gain on sales of mortgage loans
294
225
1,164
613
TOTAL NON-INTEREST INCOME
11,217
10,511
NON-INTEREST EXPENSE:
Salaries and employee benefits
21,361
19,248
Occupancy expense
2,958
2,676
Equipment expense
5,340
4,505
FDIC Expense
690
750
10,530
9,580
TOTAL NON-INTEREST EXPENSE
40,879
36,759
INCOME BEFORE INCOME TAXES
24,721
23,777
Provision for income taxes
4,917
5,371
NET INCOME
19,804
18,406
OTHER COMPREHENSIVE INCOME
Change in unrealized gains/(losses) on securities, net of reclassifications and taxes
(8,674)
11,100
Change in funded status of post retirement benefits, net of taxes
79
COMPREHENSIVE INCOME
11,209
29,509
PER SHARE DATA
Basic and Diluted Earnings per Share
1.67
1.55
Weighted average number of shares outstanding (in thousands)
11,885
11,842
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
March 30, 2026, and 2025
(Unaudited)
Accumulated
Common
Additional
Retained
Comprehensive
Treasury
Stock
Capital
Earnings
Income/(Loss)
Total
Balance, January 1, 2025
2,018
145,927
687,366
(132,285)
(153,985)
549,041
Net income
Other comprehensive income
11,103
Omnibus Equity Incentive Plan
1
232
233
Treasury shares purchased (17,028 shares)
(795)
Cash dividends, $.51 per share
(6,043)
Balance, March 31, 2025
2,019
146,159
699,729
(121,182)
(154,780)
571,945
Balance, January 1, 2026
(8,595)
201
Treasury shares purchased (5,510 shares)
(332)
Cash dividends, $.56 per share
(6,659)
Balance, March 31, 2026
CONSOLIDATED STATEMENTS OF CASH FLOWS
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income
Adjustments to reconcile net income to net cash provided by operating activities:
Net amortization of premiums and discounts on investments
790
1,050
Depreciation and amortization
2,833
3,257
Bargain purchase gain
(716)
Restricted stock compensation
Gain on sale of mortgage loans
(294)
(225)
(Gain)/loss on sale of other real estate
(2)
Other, net
(2,548)
(3,612)
NET CASH FROM OPERATING ACTIVITIES
22,620
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales of securities available-for-sale
47,691
Calls, maturities and principal reductions on securities available-for-sale
34,149
26,968
Purchases of securities available-for-sale
(61,532)
Loans made to customers, net of repayment
(79,792)
(16,795)
Net change in federal funds sold
393
Redemption of restricted stock
1,220
48
Purchase of restricted stock
(22)
(21)
Cash received (disbursed) from acquisitions, net
(11,779)
Proceeds from sales of other real estate owned
Additions to premises and equipment
(687)
(566)
NET CASH FROM INVESTING ACTIVITIES
(70,277)
10,029
CASH FLOWS FROM FINANCING ACTIVITIES:
Net change in deposits
(22,246)
(78,863)
Net change in short-term borrowings
51,827
(49,448)
Dividends paid
(6,650)
(6,032)
Purchase of treasury shares
Proceeds from other borrowings
1,200,000
350,000
Maturities of other borrowings
(1,208,424)
(253,263)
NET CASH FROM FINANCING ACTIVITIES
14,175
(38,401)
NET CHANGE IN CASH AND CASH EQUIVALENTS
(33,482)
(7,315)
CASH AND DUE FROM BANKS, BEGINNING OF PERIOD
93,526
CASH AND DUE FROM BANKS, END OF PERIOD
86,211
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The accompanying March 31, 2026 and 2025 consolidated financial statements are unaudited. The December 31, 2025 consolidated financial statements are as reported in the First Financial Corporation (the “Corporation”) 2025 annual report. The information presented does not include all information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. The following notes should be read together with notes to the consolidated financial statements included in the 10-K filed with the Securities and Exchange Commission for the fiscal year ended December 31, 2025.
1. Significant Accounting Policies
The significant accounting policies followed by the Corporation and its subsidiaries for interim financial reporting are consistent with the accounting policies followed for annual financial reporting. All adjustments which are, in the opinion of management, necessary for a fair statement of the results for the periods reported have been included in the accompanying consolidated financial statements and are of a normal recurring nature. The Corporation reports financial information for only one segment, banking. Some items in the prior year financials were reclassified to conform to the current presentation.
The Omnibus Equity Incentive Plan is a long-term incentive plan that was designed to align the interests of participants with the interests of shareholders. Under the plan, awards may be made based on certain performance measures. The grants are made in restricted stock units that are subject to a vesting schedule. These shares vest over 3 years in increments of 33%, 33%, and 34% respectively. For the three months ended 2026 and 2025, 16,647 and 25,134 shares were awarded, respectively. These shares had a grant date value of $1.1 million and $1.2 million for 2026 and 2025, vest over three years, and their grant is not subject to future performance measures. Outstanding shares are increased at the award date for the total shares awarded.
On March 1, 2026, the Corporation completed its acquisition of CedarStone Financial, Inc. Therefore, the results of CedarStone have been included in the results of operations beginning on March 1, 2026. On July 1, 2024, the Corporation completed its acquisition of SimplyBank. Therefore, the results of SimplyBank have been included in the results of operations beginning on July 1, 2024. See footnote 12, Acquisitions, for more information.
On July 4, 2025, President Trump signed into law the legislation formally titled, “An Act to Provide for Reconciliation Pursuant to Title II of H. Con. Res. 14,” and commonly referred to as the One Big Beautiful Bill (“the Act”). The Corporation evaluated and applied the income tax implications of the Act. The Corporation’s financial statements were not materially impacted by the Act.
2. New accounting standards
Accounting Pronouncements Adopted:
In July 2025, the FASB issued ASU 2025-05, "Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets." This ASU amends ASC 326-202 to provide a practical expedient (for all entities) and an accounting policy election (for all entities, other than public business entities that elect the practical expedient) related to the estimation of expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under ASC 606, "Revenue From Contracts with Customers". This ASU is effective for annual and interim reporting periods in fiscal years beginning after December 15, 2025. Early adoption is permitted for financial statements that have not yet been issued. The Corporation adopted ASU 2025-05 on January 1, 2026. The Corporation assessed ASU 2025-05 and applied the standard to the consolidated financial statements and related disclosures.
In November 2025, the FASB issued ASU 2025-08 Financial Instruments—Credit Losses (Topic 326) — Purchased Loans. The amendments in this Update expand the population of acquired financial assets subject to the gross-up approach in Topic 326. In accordance with the amendments in this Update, loans (excluding credit cards) acquired without credit deterioration and deemed “seasoned” are purchased seasoned loans and accounted for using the gross-up approach at acquisition. All non- PCD (purchased financial asset with credit deterioration) loans (excluding credit cards) that are acquired in a business combination are deemed seasoned. Other non-PCD loans (excluding credit cards) are seasoned if they were purchased at least 90 days after origination and the acquirer was not involved in the origination of the loans. The amendments in this Update are effective for all entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. The
amendments in this Update should be applied prospectively to loans that are acquired on or after the initial application date. Early adoption is permitted in an interim or annual reporting period in which financial statements have not yet been issued or made available for issuance. The Corporation early adopted ASU 2025-08 on January 1, 2026. The Corporation applied the standard to the acquisition of CedarStone Financial Inc., which supported the impact to the allowance for credit loss, but limited the impact to the provision for balances on March 1, 2026.
Recent Accounting Pronouncements:
In November 2024, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2024-03, “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses.” This update is intended to provide investors more detailed disclosures around specific types of expenses. This ASU requires certain details for expenses presented on the face of the consolidated statements of income as well as selling expenses to be presented in the notes to the financial statements. This update is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The disclosure updates are required to be applied prospectively with the option for retrospective application. The Corporation is assessing ASU 2024-03 and its effect on its consolidated financial statements and related disclosures.
8
3. Allowance for Credit Losses
The following table presents the activity of the allowance for credit losses by portfolio segment for the three months ended March 31.
Allowance for Credit Losses:
March 31, 2026
(Dollar amounts in thousands)
Unallocated
Beginning balance
18,805
16,620
12,348
222
47,995
Initial allowance on acquired loans
502
2,722
96
3,320
477
174
1,992
(93)
Loans charged-off
(174)
(65)
(2,706)
(2,945)
Recoveries
140
87
1,191
1,418
Ending Balance
19,750
19,538
12,921
129
52,338
March 31, 2025
16,963
17,470
12,046
253
46,732
775
(540)
1,959
(244)
(490)
(108)
(2,643)
(3,241)
277
143
974
1,394
17,525
16,965
12,336
9
46,835
The tables below present the recorded investment in non-performing loans by class of loans.
Loans Past
Nonaccrual
Due Over
With No
90 Days
Allowance
and Greater
Still Accruing
For Credit Loss
Commercial & Industrial
127
5,684
Farmland
Non Farm, Non Residential
16,699
13,376
Agriculture
318
1,337
All Other Commercial
191
First Liens
104
984
Home Equity
138
465
Junior Liens
263
180
Multifamily
508
453
All Other Residential
Motor Vehicle
22
2,428
All Other Consumer
183
TOTAL
972
28,659
13,972
December 31, 2025
51
6,058
394
15,365
13,126
1,218
195
606
918
82
178
442
81
47
517
205
39
20
2,449
213
1,114
27,495
13,970
10
The following tables present the amortized cost basis of collateral dependent loans by class of loans:
Collateral Type
Real Estate
3,527
5,965
17,866
1,334
2,963
255
402
16
25,673
7,299
3,644
5,666
17,572
829
21,714
6,495
11
The following tables presents the aging of the recorded investment in loans by past due category and class of loans.
30-59 Days
60-89 Days
Past Due
Current
646
647
1,407
2,700
644,066
646,766
133,864
134,258
14,651
14,817
1,155,018
1,169,835
238
1,262
1,500
120,170
121,670
162
351,099
351,261
5,799
3,169
398
9,366
549,392
558,758
1,053
264
1,963
141,803
143,766
633
229
311
1,173
75,488
76,661
154
278
433
489,265
489,698
37,897
37,993
4,931
979
666
6,576
671,186
677,762
385
75
50
510
28,127
28,637
28,766
5,665
5,259
39,690
4,397,375
4,437,065
883
3,937
1,640
6,460
642,454
648,914
320
128,663
128,983
1,060
1,772
85
2,917
910,280
913,197
63
71
343
141,341
141,818
17
175
192
556,861
557,053
3,852
1,151
779
5,782
444,131
449,913
618
234
566
105,700
107,118
403
126
266
795
71,989
72,784
187
265
68
520
331,317
331,837
26
24
28,936
28,986
7,186
1,457
629
9,272
653,385
662,657
392
103
563
28,056
28,619
15,007
9,116
4,643
4,043,113
4,071,879
12
Loan Modifications Made to Borrowers Experiencing Financial Difficulty:
Modification of the terms of such loans typically include one or a combination of the following: a reduction of the stated interest rate of the loan; an extension of the maturity date at a stated rate of interest lower than the current market rate for new debt with similar risk; or a permanent reduction of the recorded investment in the loan.
The following table presents the amortized cost of loans and leases at March 31, 2026 that were both experiencing financial difficulty and modified during the twelve months ended March 31, 2026, by class and by type of modification. The percentage of the amortized cost of loans and leases that were modified to borrowers in financial distress as compared to the amortized cost of each class of financial receivable is also presented below.
Combination
Term
Extension and
Extension
Class of
Principal
Payment
Interest Rate
Financing
Forgiveness
Delay
Reduction
Receivable
0.03
%
14
52
0.09
74
0.20
15
49
0.04
31
0.01
The Corporation has no commitments to lend additional amounts to the borrowers included in the table above.
The Corporation closely monitors the performance of loans and leases that have been modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. The following table presents the performance of such loans that have been modified in the last twelve months:
30 - 59
60 - 89
Greater Than
Days
89 Days
18
121
The following table presents the financial effect of loan and lease modifications presented above to borrowers experiencing financial difficulty for the twelve months ended March 31, 2026.
Weighted-
Average
1.53
100
1.25
99
0.63
107
1.27
72
13
The following table presents the amortized cost basis of loans that had a payment default during the twelve months ended March 31, 2026 and were modified in the twelve months prior to that default to borrowers experiencing financial difficulty. A loan is considered to be in payment default once it is 30 days contractually past due under the modified terms.
Upon the Corporation’s determination that a modified loan has subsequently been deemed uncollectible, the loan is written off. Therefore, the amortized cost basis of the loan is reduced by the uncollectible amount and the allowance for credit losses is adjusted by the same amount.
Credit Quality Indicators:
The Corporation categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Corporation analyzes loans individually by classifying the loans as to credit risk. This analysis includes non-homogeneous loans, such as commercial loans, with an outstanding balance greater than $250 thousand. Any consumer loans outstanding to a borrower who had commercial loans analyzed will be similarly risk rated. This analysis is performed on a quarterly basis. The Corporation uses the following definitions for risk ratings:
Special Mention: Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.
Substandard: Loans classified as substandard are inadequately protected by the current net worth and debt service capacity of the borrower or of any pledged collateral. These loans have a well-defined weakness or weaknesses which have clearly jeopardized repayment of principal and interest as originally intended. They are characterized by the distinct possibility that the institution will sustain some future loss if the deficiencies are not corrected.
Doubtful: Loans classified as doubtful have all the weaknesses inherent in those graded substandard, with the added characteristic that the severity of the weaknesses makes collection or liquidation in full highly questionable or improbable based upon currently existing facts, conditions, and values.
Furthermore, non-homogeneous loans which were not individually analyzed, but are 90+ days past due or on non-accrual are classified as substandard. Loans included in homogeneous pools, such as residential or consumer may be classified as substandard due to 90+ days delinquency, non-accrual status, bankruptcy, or loan restructuring.
The following tables present the commercial loan portfolio by risk category. These balances do not include accrued interest:
Term Loans at Amortized Cost Basis by Origination Year
Revolving
2024
2023
2022
Prior
Loans
Commercial and Industrial
Pass
32,340
73,976
68,693
29,830
87,896
158,351
161,619
612,705
Special Mention
3,132
1,979
1,154
413
4,784
3,243
14,982
Substandard
25
1,007
7,981
4,541
13,668
Doubtful
Not Rated
152
1,405
425
130
3,285
Subtotal
35,624
77,459
70,834
30,557
89,517
171,246
169,403
644,640
Current period gross charge-offs
-
3,962
19,258
9,588
17,674
14,254
61,932
315
126,983
749
1,357
478
1,978
280
328
20,007
10,945
18,152
14,383
64,196
131,960
41,575
194,778
201,574
123,729
174,132
384,102
11,995
1,131,885
8,329
900
2,114
11,343
1,907
20,381
22,288
701
209,903
176,939
407,298
1,166,217
1,813
9,515
9,470
4,937
3,832
19,694
53,283
102,544
279
676
2,758
1,102
3,767
8,582
28
296
196
109
4,967
1,798
7,394
9,543
10,046
5,809
6,699
25,763
58,848
118,521
Other Commercial
19,711
109,369
42,489
13,240
66,376
88,845
7,843
347,873
300
561
861
743
170
109,669
43,050
66,380
89,758
349,651
173
Multifamily >5 Residential
3,578
54,040
134,852
80,749
69,263
124,611
235
467,328
6,181
11,956
69
18,206
479
1,358
9,759
81,420
126,316
487,371
102,979
460,936
466,666
270,159
415,753
837,535
235,290
2,789,318
9,313
3,028
11,680
1,431
16,108
10,047
7,010
58,617
221
3,272
34,630
6,339
44,900
973
2,365
5,525
112,444
465,496
479,630
272,236
435,338
884,577
248,639
2,898,360
2021
109,471
69,074
31,396
89,638
70,630
99,985
140,465
610,659
6,292
302
1,145
5,347
3,769
2,603
19,458
32
504
1,511
6,737
4,203
12,998
1,595
1,061
514
289
115
53
3,627
111,066
76,438
32,244
91,576
77,603
110,544
147,271
646,742
86
56
219
494
15,852
9,054
17,769
14,137
15,774
49,862
365
122,813
1,933
626
1,104
10,199
18,948
50,581
125,856
156,729
157,955
90,074
153,861
138,925
170,080
9,680
877,304
8,350
946
2,034
11,330
1,924
15,699
3,382
21,005
697
166,305
156,731
154,624
176,193
910,336
33
13,315
10,053
6,034
6,428
3,040
27,137
56,978
122,985
84
914
141
999
4,298
6,821
29
287
207
142
4,422
3,865
8,969
21
23
13,729
10,425
6,241
7,485
3,219
32,558
65,141
138,798
83
95,156
87,870
62,856
90,093
70,734
136,922
7,986
551,617
560
860
541
754
366
381
95,456
88,430
90,108
71,275
137,501
553,612
728
30,157
96,593
55,938
54,759
34,709
37,417
544
310,117
12,075
6,319
18,394
485
420
953
1,373
67,039
35,129
44,969
330,369
420,680
430,599
264,067
408,916
333,812
521,403
216,018
2,595,495
685
16,431
1,003
15,080
5,488
13,208
6,901
58,796
298
717
2,775
17,768
15,660
8,068
45,315
1,062
305
556
2,075
6,107
422,989
448,390
266,301
427,076
357,624
552,346
230,987
2,705,713
The Corporation evaluates the credit quality of its other loan portfolios, which includes residential real estate, consumer and lease financing loans, based primarily on the aging status of the loan and payment activity. Accordingly, loans on non-accrual status and loans past due 90 days or more and still accruing interest are considered to be nonperforming for purposes of credit quality evaluation. The following table presents the other loan portfolio based on the credit risk profile of loans that are performing and loans that are nonperforming. These balances do not include accrued interest:
Performing
25,547
83,278
85,554
54,171
79,082
223,641
2,381
553,654
Non-performing
1,282
1,232
3,104
83,360
86,836
79,590
224,873
556,758
2,017
11,440
1,027
958
678
1,769
124,577
142,466
30
156
813
1,260
708
1,925
124,971
143,279
5,987
22,893
13,674
9,291
9,290
13,083
1,855
76,073
34
88
347
22,927
13,722
9,394
9,364
13,171
76,420
Other Residential
3,414
18,149
4,369
3,004
3,451
5,199
250
37,836
5,201
37,838
38
81,026
261,573
152,714
99,898
63,423
13,732
672,375
348
584
569
705
2,459
261,921
153,298
100,467
64,128
13,985
674,834
597
497
668
2,506
Other Consumer
828
4,990
4,307
2,313
1,298
1,877
12,663
28,276
59
61
212
4,997
4,366
2,374
1,301
1,916
12,706
28,488
46
200
118,819
402,323
261,645
169,635
157,222
259,301
141,735
1,510,680
471
2,206
733
1,320
1,770
437
6,937
Total other loans
402,794
263,851
170,368
158,542
261,071
142,172
1,517,617
64,142
61,775
39,526
74,359
60,920
144,310
1,786
446,818
70
1,456
1,571
61,845
60,965
145,766
448,389
338
938
793
650
259
1,284
101,907
106,169
683
276
1,459
102,300
106,787
19
23,832
13,403
9,409
9,145
4,674
9,676
2,107
72,246
307
13,417
9,561
9,170
4,691
9,775
72,553
7,829
6,807
3,843
4,991
3,573
1,757
28,800
57
3,622
1,765
28,857
279,286
168,244
113,956
76,182
14,119
5,441
657,237
519
500
866
194
128
2,429
279,508
168,763
114,456
77,048
14,313
5,569
659,666
759
2,380
2,279
4,075
713
249
10,455
4,776
5,276
2,726
1,503
1,137
942
28,202
67
35
65
267
4,778
5,343
2,793
1,522
1,172
954
11,907
28,469
246
761
380,203
256,443
170,253
166,830
84,682
163,410
117,651
1,339,472
224
670
719
943
357
1,878
458
5,249
380,427
257,113
170,972
167,773
85,039
165,288
118,109
1,344,721
The Corporation has purchased loans, for which there was, at acquisition, evidence of more than insignificant deterioration of credit quality since origination. The carrying amount of those loans is as follows:
Purchase price of loans at acquisition
2,795
Allowance for credit losses at acquisition
695
Non-credit discount at acquisition
226
Par value of loans at acquisition
3,716
4. Securities
The amortized cost and fair value of the Corporation’s investments are shown below. All securities are classified as available-for-sale.
Amortized
Unrealized
Cost
Gains
Losses
Fair Value
U.S. Government agencies
97,515
113
(7,838)
89,790
Mortgage Backed Securities - residential
581,177
(60,490)
520,937
Mortgage Backed Securities - commercial
12,668
(429)
12,240
Collateralized mortgage obligations
180,592
(23,138)
157,493
State and municipal obligations
397,395
681
(29,257)
368,819
Municipal taxable
20,561
(2,014)
18,599
Collateralized debt obligations
248
2,642
2,890
1,290,156
3,778
(123,166)
91,945
114
(7,749)
84,310
Mortgage Backed Securities-residential
573,002
873
(58,456)
515,419
Mortgage Backed Securities-commercial
12,712
(328)
12,386
179,638
(21,622)
158,098
379,894
1,280
(23,456)
357,718
20,554
(1,893)
18,745
2,850
1,257,745
5,285
(113,504)
Contractual maturities of debt securities at March 31, 2026 were as follows.
Available-for-Sale
Fair
Value
Due in one year or less
7,601
7,565
Due after one but within five years
32,626
32,060
Due after five but within ten years
126,240
123,068
Due after ten years
349,252
317,405
515,719
480,098
Mortgage-backed securities and collateralized mortgage obligations
774,437
690,670
There were no gross gains and losses from investment sales/calls realized by the Corporation for the three months ended March 31, 2026. Additionally, there were no gross gains and losses from investment sales/calls realized by the Corporation for the three months ended March 31, 2025.
The following tables show the securities’ gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in continuous unrealized loss position, at March 31, 2026 and December 31, 2025.
Less Than 12 Months
More Than 12 Months
21,026
(150)
55,768
(7,688)
76,794
Mortgage Backed Securities - Residential
74,202
(913)
414,240
(59,577)
488,442
Mortgage Backed Securities - Commercial
10,971
30,378
(431)
123,671
(22,707)
154,049
125,649
(1,680)
163,503
(27,577)
289,152
891
(4)
13,756
(2,010)
14,647
Total temporarily impaired securities
252,146
(3,178)
781,909
(119,988)
1,034,055
7,137
(31)
59,562
(7,718)
66,699
11,961
(29)
427,877
(58,427)
439,838
11,114
4,381
(43)
135,393
(21,579)
139,774
23,889
(86)
204,976
(23,370)
228,865
13,876
47,368
(189)
852,798
(113,315)
900,166
Management evaluates securities for impairment related to credit losses at least on a quarterly basis, and more frequently when economic or market conditions warrant such an evaluation. The investment securities portfolio is evaluated for impairment related to credit losses by segregating the portfolio into two general segments.
In evaluating for impairment, management considers the reason for the decline, the extent of the decline, the duration of the decline and whether the Corporation intends to sell a security or is more likely than not to be required to sell a security before recovery of its amortized cost. If an entity intends to sell or it is more likely than not it will be required to sell the security before recovery of its amortized cost basis, the security’s amortized cost is written down to fair value through income. If an entity does not intend to sell the security and it is not more likely than not that the entity will be required to sell the security before recovery of its amortized cost basis less any current-period loss, a credit loss exists and an allowance for credit losses is recorded, limited to the amount that the fair value of the security is less than its amortized cost basis. Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income, net of applicable taxes.
Gross unrealized losses on investment securities were $123.17 million as of March 31, 2026 and $113.50 million as of December 31, 2025. Management believes these losses represent negative adjustments to market value relative to the interest rate environment reflecting the increase in market rates and not losses related to the creditworthiness of the issuer. The portfolio contains primarily government agency, agency backed mortgage backed securities (“MBS”), and collateralized mortgage obligations (“CMO”), which are issued by government sponsored enterprises and are backed by the full faith and credit of the United States government. Secondarily, the Corporation invests in municipal securities issued by state and local governments. Of these, almost half are either insured or contain state enhancements. On the remaining, credit is monitored by the investment committee. Based upon our review of the issuers, we do not believe these investments to be other than temporarily impaired. Management does not intend to sell these securities and it is not more likely than not that we will be required to sell them before their anticipated recovery.
The table below presents a rollforward of the credit losses recognized in earnings for the three month period ended March 31, 2026 and 2025:
Three Months Ended March 31,
2,974
Recoveries of amounts previously written off
(299)
Ending balance
2,675
5. Qualified Affordable Housing Project Investments
The Corporation invests in qualified affordable housing projects. The balance of investment for qualified housing projects was $37.1 million at March 31, 2026 and $37.9 million at December 31, 2025. These balances are reflected in the other assets line on the consolidated balance sheets. Total unfunded commitments related to the investments in qualified affordable housing projects totaled $17.4 million at March 31, 2026 and $19.9 million at December 31, 2025. These balances are reflected in the other liabilities line on the consolidated balance sheets.The Corporation expects to fulfill these commitments by the end of December 31, 2037.
The Corporation recognized amortization expense of $15 thousand during the three months ended March 31, 2026, and $16 thousand during the three months ended March 31, 2025, which was included within other noninterest expense on the consolidated statements of income. The Corporation recognized amortization expense of $773 thousand during the three months ended March 31, 2026, and $720 thousand during the three months ended March 31, 2025, which was included within income tax expense on the consolidated statements of income. Additionally, the Corporation recognized tax credits and other benefits from its investment in affordable housing tax credits of $1.1 million during the three months ended March 31, 2026, and $914 thousand during the three months ended March 31, 2025.
6. Fair Value
FASB ASC No. 820-10 establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:
Level 1: Quoted prices (unadjusted) of identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.
Level 2: Significant other observable inputs other than Level I prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.
Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.
The fair value of most securities available for sale is determined by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs) or matrix pricing, which is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted securities (Level 2 inputs).
For those securities that cannot be priced using quoted market prices or observable inputs a Level 3 valuation is determined. These securities are primarily trust preferred securities and investments in state and municipal securities. The fair value of state and municipal obligations are derived by comparing the securities to current market rates plus an appropriate credit spread to determine an estimated value. Illiquidity spreads are then considered. Credit reviews are performed on each of the issuers. The significant unobservable inputs used in the fair value measurement of the Corporation’s state and municipal obligations are credit spreads related to specific issuers. Significantly higher credit spread assumptions would result in significantly lower fair value measurement. Conversely, significantly lower credit spreads would result in a significantly higher fair value measurements.
The fair value of derivatives is based on valuation models using observable market data as of the measurement date (Level 2 inputs).
Fair Value Measurements Using
Significant Unobservable Inputs (Level 3)
Level 1
Level 2
Level 3
State and municipal
1,168,126
Derivative Assets
2,489
Derivative Liabilities
(2,489)
1,146,676
2,709
(2,709)
There were no transfers between Level 1 and Level 2 during 2026 and 2025.
The tables below presents a reconciliation and income statement classification of gains and losses for all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three months ended March 31, 2026 and the year ended December 31, 2025.
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
State and
municipal
Collateralized
obligations
debt obligations
Beginning balance, January 1
Total realized/unrealized gains or losses
Included in earnings
Included in other comprehensive income
(208)
Transfers
Settlements
Ending balance, March 31
Year Ended
805
2,896
3,701
(46)
Purchases
(805)
Ending balance, December 31
Other real estate owned is valued at Level 3. Other real estate owned at March 31, 2026 with a value of $184 thousand was reduced by $20 thousand for fair value adjustment. At March 31, 2026 other real estate owned was comprised of $184 thousand from residential loans. Other real estate owned at December 31, 2025 with a value of $94 thousand was reduced by $9 thousand for fair value adjustment. At December 31, 2025 other real estate owned was comprised of $94 thousand from residential loans.
Fair value is measured based on the value of the collateral securing those loans, and is determined using several methods. Generally the fair value of real estate is determined based on appraisals by qualified licensed appraisers. Appraisals for real estate generally use three methods to derive value: cost, sales or market comparison and income approach. The cost method bases value on the cost to replace current property. The market comparison evaluates the sales price of similar properties in the same market area. The income approach considers net operating income generated by the property and the investor’s required return. The final fair value is based on a reconciliation of these three approaches. If an appraisal is not available, the fair value may be determined by using a cash flow analysis, a broker’s opinion of value, the net present value of future cash flows, or an observable market price from an active market. Fair value of other real estate is based upon the current appraised values of the properties as determined by qualified licensed appraisers and the Company’s judgment of other relevant market conditions. Appraisals are obtained annually and reductions in value are recorded as a valuation through a charge to expense. The primary unobservable input used by management in estimating fair value are additional discounts to the appraised value to consider market conditions and the age of the appraisal, which are based on management’s past experience in resolving these types of properties. These discounts range from 0% to 100% with an average discount of 47%. Values for non-real estate collateral, such as business equipment, are based on appraisals performed by qualified licensed appraisers or the customers financial statements. Values for non real estate collateral use much higher discounts than real estate collateral. Other real estate and individually evaluated loans carried at fair value are primarily comprised of smaller balance properties.
The following table presents quantitative information about recurring and non-recurring Level 3 fair value measurements at March 31, 2026.
Valuation Technique(s)
Unobservable Input(s)
Range
Discounted cash flow
Discount rate
5.65
Collateral dependent loans
11,033
Discount rate for age of appraisal and market conditions
0.00%-100.00
The following table presents quantitative information about recurring and non-recurring Level 3 fair value measurements at December 31, 2025.
5.96
7,328
10.00%-100.00
The carrying amounts and estimated fair value of financial instruments at March 31, 2026 and December 31, 2025, are shown below. Carrying amount is the estimated fair value for cash and due from banks, federal funds sold, short-term borrowings, accrued interest receivable and payable, demand deposits, short-term debt and variable-rate loans or deposits that reprice frequently and fully. Security fair values were described previously. For fixed-rate, collectively evaluated loans or deposits, variable rate loans or deposits with infrequent repricing or repricing limits, and for longer-term borrowings, fair value is based on discounted cash flows using current market rates applied to the estimated life and considering credit risk. The valuation of individually evaluated loans was described previously. Loan fair value estimates represent an exit price. Fair values of loans held for sale are based on market bids on the loans or similar loans. It was not practicable to determine the fair value of Federal Home Loan Bank stock due to restrictions placed on its transferability. Fair value of debt is based on current rates for similar financing. The fair value of off-balance sheet items is not considered material.
Carrying
32,253
64,634
n/a
Loans, net
4,327,017
6,926
20,955
(4,842,386)
(4,838,894)
(349,781)
(208,756)
Accrued interest payable
(3,534)
38,587
91,782
3,949,043
6,482
21,280
(4,551,111)
(4,554,207)
(292,468)
(188,208)
(3,084)
7. Borrowings
Short-term borrowings:
Period–end short-term borrowings were comprised of the following:
Federal Funds Purchased
306,175
257,825
Repurchase Agreements
43,606
34,643
The Corporation enters into sales of securities under agreements to repurchase. The amounts received under these agreements represent short-term borrowings and are reflected as a liability in the consolidated balance sheets. The securities underlying these agreements are included in investment securities in the consolidated balance sheets. The Corporation has no control over the market value of the securities, which fluctuates due to market conditions. However, the Corporation is obligated to promptly transfer additional securities if the market value of the securities falls below the repurchase agreement price. The Corporation manages this risk by maintaining an unpledged securities portfolio that it believes is sufficient to cover a decline in the market value of the securities sold under agreements to repurchase.
Collateral pledged to repurchase agreements by remaining maturity are as follows:
Remaining Contractual Maturity of the Agreements
Overnight
Greater
and
Up to 30
30 - 90
than 90
continuous
days
Mortgage Backed Securities - Residential and CollateralizedMortgage Obligations
39,001
585
1,990
2,030
27,514
351
3,978
2,800
Other borrowings:
Other borrowings at March 31, 2026 and December 31, 2025 are summarized as follows:
FHLB advances
200,614
175,708
Notes payable
8,142
12,500
The aggregate minimum annual retirements of other borrowings are as follows:
Twelve Months Ended March 31,
2027
204,018
2028
1,738
2029
3,000
2030
2031
Thereafter
At March 31, 2026 and December 31, 2025, other borrowings are summarized as follows: The Corporation’s subsidiary bank is a member of the Federal Home Loan Bank (FHLB) and accordingly are permitted to obtain advances. There are $200.6 million of advances from the FHLB at March 31, 2026, and $175.7 million of advances at December 31, 2025. FHLB advances are, generally due in full at maturity. They are secured by eligible securities and a blanket pledge on real estate loan collateral. In addition the Corporation acquired a note payable to a commercial bank and debentures with the acquisition of CedarStone. The balance at March 31, 2026 is $8.1 million.
8. Components of Net Periodic Benefit Cost
Post-Retirement
Pension Benefits
Health Benefits
Service cost
108
Interest cost
990
1,016
37
Expected return on plan assets
(1,216)
(1,094)
Net amortization of prior service cost
Net amortization of net (gain) loss
(30)
(39)
Net Periodic Benefit Cost
(122)
Employer Contributions
First Financial Corporation previously disclosed in its financial statements for the year ended December 31, 2025 that it expected to contribute $1.6 million and $556 thousand respectively to its Pension Plan and ESOP and $244 thousand to the Post Retirement Health Benefits Plan in 2026. Contributions of $327 thousand have been made to the Pension Plan thus far in 2026. Contributions of $82 thousand have been made through the first three months of 2026 for the Post Retirement Health Benefits plan. No contributions have been made in 2026 for the ESOP. The Pension plan was frozen for most employees at the end of 2012 and for those employees there will be discretionary contributions to the ESOP plan and a 401K plan in place of the former Pension benefit. In the first three months of 2026 and 2025 there has been $1.1 million and $847 thousand of expense recorded for potential contributions to these alternative retirement benefit options.
27
9. Revenue from Contracts with Customers
All of the Corporation’s revenue from contracts with customers in the scope of ASC 606 is recognized within Non-Interest Income. The following table presents the Corporation’s sources of Non-Interest Income for the three months ended March 31, 2026 and 2025. Items outside the scope of ASC 606 are noted as such.
Non-interest income
Service charges on deposits and debit card fee income
Net gains on sales of loans (a)
Loan servicing fees (a)
Other service charges and fees (a)
Other (b)
Total non-interest income
Service charges on deposits: The Corporation earns fees from its deposit customers for transaction-based, account maintenance, and overdraft services. Transaction-based fees, which include services such as ATM use fees, stop payment charges, statement rendering, and ACH fees, are recognized at the time the transaction is executed as that is the point in time the Corporation fulfills the customer’s request. Account maintenance fees, which relate primarily to monthly maintenance, are earned over the course of a month, representing the period over which the Corporation satisfies the performance obligation. Overdraft fees are recognized at the point in time that the overdraft occurs. Service charges on deposits are withdrawn from the customer’s account balance.
Trust and financial services: The Corporation earns asset management fees from its contracts with trust customers to manage assets for investment, and/or to transact on their accounts. These fees are primarily earned over time as the Corporation provides the contracted monthly or quarterly services and are generally assessed based on a tiered scale of the market value of assets under management at month-end. Fees that are transaction based, including trade execution services, are recognized at the point in time that the transaction is executed, i.e. the trade date. Other related services provided and the fees the Corporation earns, which are based on a fixed fee schedule, are recognized when the services are rendered.
Interchange income: The Corporation earns interchange fees from debit and credit cardholder transactions conducted through the payment network. Interchange fees from cardholder transactions represent a percentage of the underlying transaction value and are recognized daily, concurrently with the transaction processing services provided to the cardholder.
Gains/Losses on sales of OREO: The Corporation records a gain or loss from the sale of OREO when control of the property transfers to the buyer, which generally occurs at the time of an executed deed. When the Corporation finances the sale of OREO to the buyer, the Corporation assesses whether the buyer is committed to perform their obligations under the contract and whether collectability of the transaction price is probable. Once these criteria are met, the OREO asset is derecognized and the gain or loss on sale is recorded upon the transfer of control of the property to the buyer. In determining the gain or loss on the sale, the Corporation adjusts the transaction price and related gain (loss) on sale if a significant financing component is present.
10. Accumulated Other Comprehensive (Loss)
The following tables summarize the changes, net of tax, within each classification of accumulated other comprehensive (loss) for the three months ended March 31, 2026 and 2025.
gains and
(Losses) on available-
for-sale
Retirement
Securities
plans
Beginning balance, January 1,
(83,358)
(3,323)
Change in other comprehensive income (loss) before reclassification
Amounts reclassified from accumulated other comprehensive income
Net current period other comprehensive income (loss)
Ending balance, March 31,
(92,032)
(3,244)
(127,807)
(4,478)
(116,707)
(4,475)
Balance at
Current Period
1/1/2026
Change
3/31/2026
Unrealized gains (losses) on securities available-for-sale without other than temporary impairment
(85,496)
(8,518)
(94,014)
Unrealized gains (losses) on securities available-for-sale with other than temporary impairment
2,138
(156)
1,982
Total unrealized gain (loss) on securities available-for-sale
Unrealized gain (loss) on retirement plans
1/1/2025
3/31/2025
(129,979)
11,096
(118,883)
2,172
2,176
Total unrealized income (loss) on securities available-for-sale
Three Months Ended March 31, 2026
Details about accumulated
Amount reclassified from
Affected line item in
other comprehensive
accumulated other
the statement where
income components
comprehensive income
net income is presented
(in thousands)
Unrealized gains and losses
Net securities gains (losses)
on available-for-sale
Income tax expense
securities
Net of tax
Amortization of
(105)
(a)
Salary and benefits
retirement plan items
(79)
Total reclassifications for the period
Three Months Ended March 31, 2025
(3)
11. Leases
The Corporation leases certain branches under operating leases. At March 31, 2026, the Corporation had lease liabilities totaling $7,384,000 and right-of-use assets totaling $7,225,000 related to these leases. At December 31, 2025, the Corporation had lease liabilities totaling $7,547,000 and right-of-use assets totaling $7,386,000 related to these leases. Lease liabilities and right-of-use assets are reflected in other liabilities and other assets, respectively. At March 31, 2026, the weighted average remaining lease term for operating leases was 10.2 years and the weighted average discount rate used in the measurement of operating lease liabilities was 3.49%.
The calculated amount of the lease liabilities and right-of-use assets are impacted by the length of the lease term and the discount rate used to present value the minimum lease payments. The Corporation’s lease agreements often include one or more options to renew at the Corporation’s discretion. If at lease inception, the Corporation considers the exercising of a renewal option to be reasonably certain, the Corporation will include the extended term in the calculation of the lease liability and right-of-use asset. Regarding the discount rate, the new standard requires the use of the rate implicit in the lease whenever this rate is readily determinable. As this rate is rarely determinable, the Corporation utilizes its incremental borrowing rate at lease inception, on a collateralized basis, over a similar term.
The following table represents lease costs and other lease information. As the Corporation elected, not to separate lease and non-lease components and instead to account for them as a single lease component, the variable lease cost primarily represents variable payments such as common area maintenance and utilities.
Lease costs were as follows:
Operating lease cost
397
362
Short-term lease cost
Variable lease cost
Total lease cost
423
395
Other information:
Cash paid for amounts included in the measurement of operating lease liabilities
371
Right-of-use assets obtained in exchange for new operating lease liabilities
468
Future minimum payments for operating leases with initial or remaining terms of one year or more as of March 31, 2026 were as follows:
1,258
1,045
810
4,196
Total Future Minimum Lease Payments
9,216
Amounts Representing Interest
(1,832)
Present Value of Net Future Minimum Lease Payments
7,384
12. Acquisitions
On March 1, 2026, the Corporation completed its acquisition of CedarStone Financial, Inc. Therefore, the results of CedarStone have been included in the results of operations beginning on March 1, 2026. Upon the terms and subject to the conditions set forth in the Merger Agreement, at the effective time of the Interim Merger (the “Effective Time”), First Financial paid $19.12 per share in cash for each share of CedarStone’s common stock outstanding. The aggregate value of the transaction was approximately $25.0 million. Acquisition-related costs of $1.5 million were included in the Corporation’s income statement for the year-to-date period ended December 31, 2025. Additionally, the Corporation included acquisition-related costs of $41 thousand in the Corporation’s income statement for the three months ending March 31, 2026.
The following table summarizes the consideration paid and the amounts of the assets acquired and liabilities assumed recognized at the acquisition date, which resulted in a bargain purchase gain of $716 thousand. Changes to the acquisition-date fair values of the assets acquired, liabilities assumed, or consideration transferred during the measurement period may result in adjustments to the bargain purchase gain. The analysis of the review of accruals and the tax impact of the fair value adjustments is still in process.
Measurement
As Initially
Period
Reported
Adjustments
As Adjusted
Consideration
Cash consideration
25,003
Fair value of total consideration transferred
Assets acquired
Cash
13,224
Investment securities available-for-sale
53,509
Bank owned life insurance
4,481
Federal Home Loan Bank stock
1,215
286,102
Premises and equipment
11,106
Core deposit intangibles
5,317
773
Total assets acquired
375,727
Liabilities assumed
313,536
28,942
5,485
2,045
Total liabilities assumed
350,008
Net identifiable assets
25,719
The fair value of net assets acquired includes fair value adjustments to certain receivables that were not considered impaired as of the acquisition date. The fair value adjustments were determined using discounted contractual cash flows. However, the Corporation believes that all contractual cash flows related to these financial instruments will be collected. As such, these receivables were not considered impaired at the acquisition date and were not subject to guidance relating to purchase credit deteriorated loans, which have shown evidence of credit deterioration since origination. Adjustments made above were within the allowable one year measurement period.
The fair value of purchased financial assets with credit deterioration was $3.0 million on the date of acquisition. The gross contractual amounts receivable relating to the purchased financial assets with credit deterioration was $3.7 million. The Corporation
estimates, on the date of acquisition, that $695 thousand of the contractual cash flows specific to the purchased financial assets with credit deterioration will not be collected.
The following table presents supplemental pro forma information as if the acquisition had occurred at the beginning of 2025. The unaudited pro forma information includes adjustments for interest income on loans and securities acquired, interest expense on deposits acquired, and the related income tax effects. The pro forma financial information is not necessarily indicative of the results of operations that would have occurred had the transactions been effected on the assumed dates.
Net interest income
58,027
54,208
19,382
18,779
Basic and diluted earnings per share
1.63
1.59
On July 1, 2024, the Corporation completed its acquisition of SimplyBank. Therefore, the results of SimplyBank have been included in the results of operations beginning on July 1, 2024. Upon the terms and subject to the conditions set forth in the Merger Agreement, at the effective time of the Interim Merger (the “Effective Time”), other than dissenting shares, each share of SimplyBank Common Stock issued and outstanding immediately prior to the Effective Time, was converted into the right to receive $718.38 per share in cash. The aggregate value of the transaction was approximately $73.4 million. Acquisition-related costs of $1.7 million were included in the Corporation’s income statement for the year-to-date period ended December 31, 2024.
Goodwill of $11.2 million arising from the acquisition consisted largely of synergies and the cost savings resulting from the combining of the operations of the companies. The goodwill value is subject to change pending receipt of the final valuation. The goodwill for SimplyBank is deductible for income tax purposes as the transaction was accounted for as a taxable acquisition. The following table summarizes the consideration paid and the amounts of the assets acquired and liabilities assumed recognized at the acquisition date.
73,400
101,553
77,350
12,816
726
467,997
(2,731)
465,266
14,231
19,788
6,184
700,645
697,914
622,937
1,719
12,899
(1,797)
11,102
637,555
635,758
63,090
(934)
62,156
10,310
934
11,244
The fair value of purchased financial assets with credit deterioration was $1.7 million on the date of acquisition. The gross contractual amounts receivable relating to the purchased financial assets with credit deterioration was $4.7 million. The Corporation estimates, on the date of acquisition, that $3.0 million of the contractual cash flows specific to the purchased financial assets with credit deterioration will not be collected.
The following table presents supplemental pro forma information as if the acquisition had occurred at the beginning of 2023. The unaudited pro forma information includes adjustments for interest income on loans and securities acquired, interest expense on deposits acquired, and the related income tax effects. The pro forma financial information is not necessarily indicative of the results of operations that would have occurred had the transactions been effected on the assumed dates.
Year Ended December 31,
188,441
196,646
36,425
70,586
3.08
5.91
ITEMS 2. and 3. Management’s Discussion and Analysis of Financial Condition and Results of Operations and Quantitative and Qualitative Disclosures About Market Risk
The purpose of this discussion is to point out key factors in the Corporation’s recent performance compared with earlier periods. The discussion should be read in conjunction with the financial statements beginning on page three of this report. All figures are for the consolidated entities. It is presumed the readers of these financial statements and of the following narrative have previously read the Corporation’s financial statements for 2025 in the 10-K filed for the fiscal year ended December 31, 2025.
This Quarterly Report on Form 10-Q contains forward-looking statements. Forward-looking statements provide current expectations or forecasts of future events and are not guarantees of future performance, nor should they be relied upon as representing management’s views as of any subsequent date. The forward-looking statements are based on management’s expectations and are subject to a number of risks and uncertainties. Although management believes that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from those expressed or implied in such statements. Risks and uncertainties that could cause actual results to differ materially include, without limitation, the Corporation’s ability to effectively execute its business plans; changes in general economic and financial market conditions; changes in interest rates; changes in the competitive environment; continuing consolidation in the financial services industry; new litigation or changes in existing litigation; losses, customer bankruptcy, claims and assessments; changes in banking regulations or other regulatory or legislative requirements affecting the Corporation’s business; and changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other regulatory agencies. Additional information concerning factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements is available in the Corporation’s Form 10-K for the year ended December 31, 2025, and subsequent filings with the United States Securities and Exchange Commission (SEC). Copies of these filings are available at no cost on the SEC’s Web site at www.sec.gov or on the Corporation’s Web site at www.first-online.com. Management may elect to update forward-looking statements at some future point; however, it specifically disclaims any obligation to do so.
Critical Accounting Policies
Certain of the Corporation’s accounting policies are important to the portrayal of the Corporation’s financial condition and results of operations, since they require management to make difficult, complex or subjective judgments, some of which may relate to matters that are inherently uncertain. Estimates associated with these policies are susceptible to material changes as a result of changes in facts and circumstances. Facts and circumstances which could affect these judgments include, without limitation, changes in interest rates, in the performance of the economy or in the financial condition of borrowers. Management believes that its critical accounting policies include determining the allowance for credit losses and the valuation of goodwill and valuing investment securities. See further discussion of these critical accounting policies in the 2025 Form 10-K.
Allowance for credit losses. The allowance for credit losses (ACL) represents management’s estimate of expected losses inherent within the existing loan portfolio. The allowance for credit losses is increased by the provision for credit losses charged to expense and reduced by loans charged off, net of recoveries. The allowance for credit losses is determined based on management’s assessment of several factors: reviews and evaluations of specific loans, changes in the nature and volume of the loan portfolio, current economic conditions, nonperforming loans, determination of acquired loans as purchase credit deteriorated, and reasonable and supportable forecasts. Loans are individually evaluated when they do not share risk characteristics with other loans in the respective pool. Loans evaluated individually are excluded from the collective evaluation. Management elected the collateral dependent practical expedient upon adoption of ASC 326. Expected credit losses on individually evaluated loans are based on the fair value of the collateral at the reporting date, adjusted for selling costs as appropriate.
Management utilizes a cohort methodology to determine the allowance for credit losses. This method identifies and captures the balance of a pool of loans with similar risk characteristics, as of a particular point in time to form a cohort, then tracks the respective losses generated by that cohort of loans over their remaining life. The cohorts track loan balances and historical loss experience since 2008, and management extends the look back period each quarter to capture all available data points in the historical loss rate calculation. The quantitative component of the ACL involves assumptions that require a significant level of estimation; these include historical losses as a predictor of future performance, appropriateness of selected delay periods, and the reasonableness of the portfolio segmentation.
A historical data set is expected to provide the best indication of future credit performance. Delay periods represent the amount of time it takes a cohort of loans to become seasoned, or incur sufficient attrition through pay downs, renewals, or charge-offs. Portfolio segmentation relates to the pooling of loans with similar risk characteristics, such as industry types, collateral, and consumer purpose.
On an annual basis, in the first quarter, management performs a recalibration of the delay periods and portfolio segmentation to determine whether they are reasonable and appropriate based on the information available at that time.
Management considers qualitative adjustments to expected credit loss estimates for information not already captured in the loss estimation process. Where past performance may not be representative of future losses, loss rates are adjusted for qualitative and economic forecast factors. Management uses the peak three consecutive quarter net charge off rate to capture maximum potential volatility over the reasonable and supportable forecast period. Historical losses utilized in setting the qualitative factor ranges are anchored to 2008 and may be supplemented by peer information when needed. The qualitative factor ranges are recalibrated annually to capture recent behavior that is indicative of the credit profile of the current portfolio.
Qualitative factors include items, such as changes in lending policies or procedures, asset specific risks, and economic uncertainty in forward-looking forecasts. Economic indicators utilized in forecasting include unemployment rate, gross domestic product, housing starts, and interest rates. Management uses a two-year reasonable and supportable period across all loan segments to forecast economic conditions. Management believes the two-year time horizon aligns with available industry guidance and various forecasting sources. Economic forecast adjustments are overlaid onto historical loss rates. As such, reversion from forecast rates to historical loss rates is immediate.
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.
Based on management’s analysis of the current portfolio, management believes the allowance is adequate. Changes in the financial condition of individual borrowers, economic conditions, historical loss experience, or the condition of the various markets in which collateral may be sold may affect the required level of the allowance for credit losses and the associated provision for credit losses. As management monitors these changes, as well as those factors discussed above, adjustments may be recorded to the allowance for credit losses and the associated provision for credit losses in the future.
Summary of Operating Results
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.
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.
In light of events in the banking sector, including bank failures, continuing interest rate activity and recessionary concerns, the Corporation has proactively positioned the balance sheet to mitigate the risks affecting the Corporation and the overall banking industry in order to serve its clients and communities.
The primary components of income and expense affecting net income are discussed in the following analysis.
Net Interest Income
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.
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.
Non-Interest Income
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.
Non-Interest Expenses
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.
Allowance for Credit Losses
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.
Income Tax Expense
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.
Non-performing Loans
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.
A summary of non-performing loans at March 31, 2026 and December 31, 2025 follows:
(000's)
Non-accrual loans
27,524
Accruing loans past due over 90 days
1,083
28,462
28,578
Ratio of the allowance for credit losses as a percentage of non-performing loans
183.9
167.9
The following loan categories comprise significant components of the nonperforming non-restructured loans:
Commercial loans
22,776
22,836
Residential loans
2,137
1,997
Consumer loans
2,611
2,662
Past due 90 days or more and still accruing
427
490
1,032
Interest Rate Sensitivity and Liquidity
First Financial Corporation has established risk measures, limits and policy guidelines for managing interest rate risk and liquidity. Responsibility for management of these functions resides with the Asset Liability Committee. The primary goal of the Asset Liability Committee is to maximize net interest income within the interest rate risk limits approved by the Board of Directors.
Interest Rate Risk
Management considers interest rate risk to be the Corporation’s most significant market risk. Interest rate risk is the exposure to changes in net interest income as a result of changes in interest rates. Consistency in the Corporation’s net interest income is largely dependent on the effective management of this risk.
The Asset Liability position is measured using sophisticated risk management tools, including earning simulation and market value of equity sensitivity analysis. These tools allow management to quantify and monitor both short-term and long-term exposure to interest rate risk. Simulation modeling measures the effects of changes in interest rates, changes in the shape of the yield curve and the effects of embedded options on net interest income. This measure projects earnings in the various environments over the next three years. It is important to note that measures of interest rate risk have limitations and are dependent on various assumptions. These assumptions are inherently uncertain and, as a result, the model cannot precisely predict the impact of interest rate fluctuations on net interest income. Actual results will differ from simulated results due to timing, frequency and amount of interest rate changes as well as overall market conditions. The Committee has performed a thorough analysis of these assumptions and believes them to be valid and theoretically sound. These assumptions are continuously monitored for behavioral changes.
The Corporation from time to time utilizes derivatives to manage interest rate risk. Management continuously evaluates the merits of such interest rate risk products but does not anticipate the use of such products to become a major part of the Corporation’s risk management strategy.
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.
Basis Point
Percentage Change in Net Interest Income
Interest Rate Change
12 months
24 months
36 months
Down 300
5.69
(5.81)
(15.29)
Down 200
5.88
(1.60)
(8.02)
Down 100
3.79
0.21
(2.95)
Up 100
(1.75)
1.29
4.27
Up 200
(6.06)
(0.07)
5.93
Up 300
(8.95)
(0.04)
9.01
Typical rate shock analysis does not reflect management’s ability to react and thereby reduce the effect of rate changes, and represents a worst-case scenario.
Liquidity Risk
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.
Financial Condition
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.
40
Capital Adequacy
The Federal Reserve, OCC and Federal Deposit Insurance Corporation (collectively, joint agencies) establish regulatory capital guidelines for U.S. banking organizations. Regulatory capital guidelines require that capital be measured in relation to the credit and market risks of both on- and off-balance sheet items using various risk weights. On January 1, 2015, the Basel 3 rules became effective and include transition provisions through January 1, 2019. Under Basel 3, Total capital consists of two tiers of capital, Tier 1 and Tier 2. Tier 1 capital is further composed of Common equity tier 1 capital and additional tier 1 capital.
Common equity tier 1 capital primarily includes qualifying common shareholders’ equity, retained earnings and certain minority interests. Goodwill, disallowed intangible assets and certain disallowed deferred tax assets are excluded from Common equity tier 1 capital.
Additional tier 1 capital primarily includes qualifying non-cumulative preferred stock, trust preferred securities (Trust Securities) subject to phase-out and certain minority interests. Certain deferred tax assets are also excluded.
Tier 2 capital primarily consists of qualifying subordinated debt, a limited portion of the allowance for loan and lease losses, Trust Securities subject to phase-out and reserves for unfunded lending commitments. The Corporation’s Total capital is the sum of Tier 1 capital plus Tier 2 capital.
To meet adequately capitalized regulatory requirements, an institution must maintain a Tier 1 capital ratio of 8.50 percent and a Total capital ratio of 10.50 percent. A “well-capitalized” institution must generally maintain capital ratios 200 bps higher than the minimum guidelines. The risk-based capital rules have been further supplemented by a Tier 1 leverage ratio, defined as Tier 1 capital divided by quarterly average total assets, after certain adjustments. BHCs must have a minimum Tier 1 leverage ratio of at least 4.0 percent. National banks must maintain a Tier 1 leverage ratio of at least 5.0 percent to be classified as “well capitalized.” Failure to meet the capital requirements established by the joint agencies can lead to certain mandatory and discretionary actions by regulators that could have a material adverse effect on the Corporation’s financial position. Below are the capital ratios for the Corporation and lead bank.
The fully phased in capital conservation buffer set the minimum ratios for common equity Tier 1 capital at 7%, the Tier 1 capital at 8.5% and the total capital at 10.5%. Currently the Corporation exceeds all of these minimums.
To Be Well Capitalized
Common equity tier 1 capital
Corporation
12.50
13.21
N/A
First Financial Bank
12.32
13.11
6.50
Total risk-based capital
13.54
14.22
13.36
14.14
10.00
Tier I risk-based capital
8.00
Tier I leverage capital
11.03
11.25
10.51
10.82
5.00
41
ITEM 4.Controls and Procedures
First Financial Corporation’s management is responsible for establishing and maintaining effective disclosure controls and procedures, as defined under Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934. As of March 31, 2026, an evaluation was performed under the supervision and with the participation of management, including the principal executive officer and principal financial officer, of the effectiveness of the design and operation of the Corporation's disclosure controls and procedures. Based on that evaluation, management, including the principal executive officer and principal financial officer, concluded that the Corporation’s disclosure controls and procedures as of March 31, 2026 were effective in ensuring material information required to be disclosed in this Quarterly Report on Form 10-Q was recorded, processed, summarized, and reported on a timely basis. Additionally, there was no change in the Corporation's internal control over financial reporting that occurred during the quarter ended March 31, 2026 that has materially affected, or is reasonably likely to materially affect, the Corporation's internal control over financial reporting.
PART II – Other Information
ITEM 1.Legal Proceedings.
There are no material pending legal proceedings, other than routine litigation incidental to the business of the Corporation or its subsidiaries, to which the Corporation or any of the subsidiaries is a party to or of which any of their respective property is subject. Further, there is no material legal proceeding in which any director, officer, principal shareholder, or affiliate of the Corporation or any of its subsidiaries, or any associate of such director, officer, principal shareholder or affiliate is a party, or has a material interest, adverse to the Corporation or any of its subsidiaries.
ITEM 1A. Risk Factors.
There have been no material changes in the risk factors from those disclosed in the Corporation’s 2024 Form 10-K filed for December 31, 2025.
ITEM 2.Unregistered Sales of Equity Securities and Use of Proceeds.
The Corporation periodically acquires shares of its common stock directly from shareholders in individually negotiated transactions. On April 21, 2022 First Financial Corporation issued a press release announcing that its Board of Directors has authorized a stock repurchase program pursuant to which up to 10% of the Corporations outstanding shares of common stock, or approximately 1,243,531 shares may be repurchased.
Following is certain information regarding shares of common stock purchased by the Corporation during the quarter covered by this report.
(c)
Total Number Of Shares
(b)
Purchased As Part Of
Maximum
Total Number Of
Average Price
Publicly Announced Plans
Number of Shares That May Yet
Shares Purchased
Paid Per Share
Or Programs *
Be Purchased *
January 1-31, 2026
Febraury 1-28, 2026
March 1-31, 2026
518,860
ITEM 3.Defaults upon Senior Securities.
Not applicable.
ITEM 4.Mine Safety Disclosures
ITEM 5.Other Information.
During the three months ended March 31, 2026, there were no Rule 10b5-1 plans or non-Rule 10b5-1 trading arrangements adopted, modified or terminated by any director or officer of the Corporation.
ITEM 6.Exhibits.
Exhibit No.:
Description of Exhibit:
3.1
Amended and Restated Articles of Incorporation of First Financial Corporation, incorporated by reference to Exhibit 3(i) of the Corporation’s Form 10-Q filed for the quarter ended September 30, 2002.
3.2
Amended and Restated Code of By-Laws of First Financial Corporation, incorporated by reference to Exhibit 3.2 of the Corporation’s Form 8-K filed on February 22, 2021.
3.3
Articles of Amendment to the Amended and Restated Articles of Incorporation of First Financial Corporation, incorporated by reference to Exhibit 3.1 of the Corporation’s Form 8-K filed on April 27, 2021.
10.2*
2001 Long-Term Incentive Plan of First Financial Corporation, incorporated by reference to Exhibit 10.3 of the Corporation’s Form 10-Q filed for the quarter ended September 30, 2002.
10.5*
2005 Long-Term Incentive Plan of First Financial Corporation, incorporated by reference to Exhibit 10.7 of the Corporation’s Form 8-K filed on September 4, 2007.
10.6*
2005 Executives Deferred Compensation Plan, incorporated by reference to Exhibit 10.5 of the Corporation’s Form 8-K filed on September 4, 2007.
10.7*
2005 Executives Supplemental Retirement Plan, incorporated by reference to Exhibit 10.6 of the Corporation’s Form 8-K filed on September 4, 2007.
10.9*
First Financial Corporation 2010 Long-Term Incentive Compensation Plan incorporated by reference to Exhibit 10. 9 of the Corporation’s Form 10-K filed March 15, 2011.
10.10*
First Financial Corporation 2011 Short-Term Incentive Compensation Plan incorporated by reference to Exhibit 10.10 of the Corporation’s Form 10-K filed March 15, 2011.
10.11*
First Financial Corporation Amended and Restated 2011 Omnibus Equity Incentive Plan incorporated by reference to Exhibit 10.1 of the Corporation’s Form 8-K for the annual meeting filed on April 27, 2021.
10.12*
Form of Restricted Stock Award Agreement under the First Financial Corporation 2011 Omnibus Equity Incentive Plan incorporated by reference to Exhibit 10.12 of the Corporation’s Form 10-Q for the quarter ended March 31, 2012 filed on May 10, 2012.
10.13*
Employment Agreement for Norman D. Lowery, effective July 1, 2025, incorporated by reference to Exhibit 10.1 of the Corporation’s Form 8-K filed June 3, 2025.
10.14*
Employment Agreement for Rodger A. McHargue, effective July 1, 2025, incorporated by reference to Exhibit 10.2 of the Corporation’s Form 8-K filed June 3, 2025.
10.15*
Employment Agreement for Stephen P. Panagouleas, effective July 1, 2025, incorporated by reference to Exhibit 10.3 of the Corporation’s Form 8-K filed June 3, 2025.
10.16*
Employment Agreement for Mark A. Franklin, effective July 1, 2025, incorporated by reference to Exhibit 10.4 of the Corporation’s Form 8-K filed June 3, 2025.
31.1
Sarbanes-Oxley Act 302 Certification for Quarterly Report on Form 10-Q for the quarter ended March 31, 2026 by Principal Executive Officer, dated May 6, 2026.
31.2
Sarbanes-Oxley Act 302 Certification for Quarterly Report on Form 10-Q for the quarter ended March 31, 2026 by Principal Financial Officer, dated May 6, 2026.
32.1
Certification, dated May 6, 2026, of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2005 on Form 10-Q for the quarter ended March 31, 2026.
101.1
Financial statements from the Quarterly Report on Form 10-Q of the Corporation for the quarter ended March 31, 2026, formatted in XBRL pursuant to Rule 405 : (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Income and Comprehensive Income, (iii) Consolidated Statements of Cash Flows, (iv) Consolidated Statements of Shareholders’ Equity, and (v) Notes to Consolidated Financial Statements, as blocks of text and in detail**.
*Management contract or compensatory plan or arrangement.
**Furnished, not filed, for purposes of Sections 11 and 12 of the Securities Act of 1933 and Section 18 of the Securities Exchange Act of 1934.
SIGNATURES
Pursuant to the requirements 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.
(Registrant)
Date: May 6, 2026
By /s/ Norman D. Lowery
Norman D. Lowery, President, CEO & Director
(Principal Executive Officer)
By /s/ Rodger A. McHargue
Rodger A. McHargue, Treasurer and CFO
(Principal Financial Officer)