thank you for standing by and welcome to the first merchants corporation second quarter 2026 earnings conference call before we begin management would like to remind you that today's call contains forward-looking statements with respect to the future performance and financial condition of first merchants corporation that involves risks and uncertainties further information is contained within the press release which we encourage you to review additionally management would refer to non-GAAP measures, which are intended to supplement but not substitute for the most directly comparable GAAP measures. The press release available on the website contains financial and other quantitative information to be discussed today, as well as the reconciliation of GAAP and non-GAAP measures. As a reminder, today's call is being recorded. I would now like to turn the conference over to Mr. Mark Hardwick. CEO, Mr. Hardwick, you may begin.

Good morning and welcome to First Merchant's second quarter 2026 conference call. Thanks for the introduction and for covering the forward-looking statement on page two. We released our earnings yesterday after markets closed and today's presentation materials are available via the link on page three of the earnings release. Turning to slide three, you will see today's presenters and members of our executive management team. Joining me on call are mike stewart our president john martin chief credit officer and michelle kebyaski our chief financial officer slide four highlights our footprint and financial scale we now now operate 126 banking centers reflecting the addition of southern indiana following the first savings acquisition. Total assets stand at $21.3 billion with $15.5 billion in loans and $16.8 billion in deposits. Turning to slide five, second quarter reported net income totaled $43.5 million or 70 cents per diluted share. Second quarter results were negatively impacted by two loans that were moved to non-accrual status with specific reserves taken against them. We are disappointed by these two downgrades, and we are confident they're not representative of the overall portfolio. We've remained confident in our outlook, as John will highlight later in the presentation, and we're happy to answer any questions that you might have during the Q&A session. Adjusted pre-tax pre-provision earnings increased to $84.6 million for the quarter, an increase of 7.5% over the first quarter of 2020. Net interest margin expanded to 3.38% and loan and deposit growth returned to more traditional levels. Year-to-date net income on slide six totaled $71.2 million, excluding the mortgage loan sale from the first quarter and acquisition-related expenses from both the first and second quarter adjusted EPS totaled $1.77 per share. The previously announced mortgage loan sale is now complete, adding $271 million of liquidity to our balance sheet. Our integration and related expense savings are now complete and position, well, for next quarter. Our balance sheet continues to grow organically reflecting strong production levels tangible common equity remains strong at 8.99 percent and we continue as we continued our share repurchase activity throughout the first half of this year all of these factors position us well for improved performance during the second half of 2026 and now mike stewart will discuss our line of business momentum thank you mark and good morning to all.

Our business strategy is summarized on slide seven. As stated on the top of the slide, building our Midwestern strength by growing organically remains our primary objective as a company. Our four primary business units work together in delivering financial solutions for businesses and consumers focused primarily on the maps you see starting on slide eight. After a flat first quarter of loan growth, the second quarter picked up the pace with nearly 6% annualized growth, both in the commercial and consumer business segments. The increase came within our three-state footprint and was driven by the community, corporate, asset-based, and investment real estate teams, working with our current client base and adding new names. Our Midwest economies continue to expand, our clients' businesses continue to grow, and our bankers continue to win new relationships. The same is true for the consumer teams within small business, mortgage, and private wealth. The full loan portfolio trend is summarized on page 27 for your reference. We remain confident in our expected mid-single-digit loan growth through the end of 2026. Let's turn to slide nine, deposits. Second quarter deposits grew at a 6.5% annualized rate. The robust commercial growth was primarily attributed to public fund increases due to seasonal tax collection and a large temporary deposit increase from a client's sale of their This client is working with our private banking team on investment management and trust service solutions for their family. The large consumer decline was also seasonal and primarily due to consumer tax refund payments being spent. The seasonality of tax payments between public entities and our consumer deposit accounts, depository accounts, will normalize through the balance of the year. The 3% year-to-date decline in total deposits was due to declines in maturity deposit balances and the balance sheet repositioning of the first savings-brokered deposits in the first quarter. On a year-to-date basis, consumer non-maturity deposit balances grew 3% with net increases in households. Michelle will be reviewing our continued net interest margin improvement, which was a direct result of discipline, deposit, and loan pricing. Michelle?

Thanks, Mike, and good morning, everyone. Slide 10 covers our second quarter's performance. There was meaningful growth in total revenues during Q2. Net interest income grew $7.6 million, and non-interest income grew $1.6 million linked quarter after normalizing for the $29.8 million loss recorded on mortgage loans sold in the first quarter. Strong revenue growth, along with disciplined expense management, resulted in overall pre-tax pre-provision earnings of $84.6 million, increasing $5.9 million over a prior quarter and generating 2% positive operating leverage. Tangible book value per share of $29.80 increased $0.46 or 1.6% linked quarter. Slide 11 shows our year-to-date results. Lines 1 through 3 at the top of the page show that we continue to grow the balance sheet towards a more favorable earning asset mix as we've reduced our lower-yielding bond portfolio along with lower-yielding mortgage loans during the first six months of the year and redeployed the capital into higher-yielding loans. Looking at the income statement in the middle of the page, total revenue grew 18% when comparing year-to-date 2026 on a normalized basis to the same period in 2025, with first savings contributing 12% of that growth. Pre-tax pre-provision earnings totaled $163.3 million, reflecting growth of $25.2 million, or 18.2% over the same period in the prior year. Year-over-year, tangible book value growth was strong, increasing $1.90 or 6.8%. Slide 12 shows details on our investment portfolio. The bond portfolio declined modestly as principal paydowns and maturities were offset by positive changes in portfolio valuation. Expecting cash flows from scheduled principal and interest payments throughout the remainder of 2026 totals $156.2 million with a roll-off yield of approximately 2.69%. We plan to continue to use cash flows generated from the bond portfolio to fund higher yielding loan growth for the remainder of the year. Slide 13 covers our Held for Investment Loan Portfolio. The total loan portfolio yield increased by two basis points from the prior quarter to 6.11%. During the quarter, new and renewed loans originated at an average yield of 6.28% compared to 6.18% in the prior quarter, demonstrating strong pricing discipline by our team. The allowance for credit losses is shown on slide 14. This quarter, we recorded $33 million of provision due to specific reserves of $29.7 million that were established on two commercial credits, which John Martin will cover in more detail in his remarks. Net charge-offs totaled $3.9 million for the quarter. As a result, the allowance for credit losses totaled $241.6 million at the end of the quarter, representing a coverage ratio of 1.56%. Slide 15 shows details of our deposit portfolio. The rate paid on deposits continued to decline to 2.07% this quarter, and our funding mix improved favorably. We used the proceeds of $271 million from the mortgage loan sale that closed in late June to reduce higher-cost brokered deposits and wholesale funding. Next, slide 16, shows a favorable net interest margin trend. Net interest income on a fully tax-equivalent basis of $165.3 million increased $7.6 million linked quarter and $26.1 million from the same period in prior year. While we have an asset-sensitive balance sheet and endured Fed rate cuts in the fourth quarter of 2025, the yield on earning assets shown on Line 4 only declined modestly, while the cost of funds shown on Line 5 has been reduced substantially. The pricing discipline on both sides of our balance sheet has created nice margin expansion through the first half of this year. Next, Slide 17 shows the details of non-interest income, which totaled $37.2 million for the quarter. Customer-related fees shown on the bottom right of the page were strong with notable quarter-over-quarter growth and gains on sales of loans and derivative hedge fees. Moving to slide 18, non-interest expense for the quarter totaled $115.3 million and included $3.8 million in acquisition-related costs. The acquisition costs were primarily incurred in the professional and other outside services and equipment expense categories. The cost synergies we expect to gain from the first savings acquisition are on track. Slide 19 shows our capital ratios. The tangible common equity ratio was 8.99% and stable compared to prior quarter. Since the beginning of the year, we have repurchased just under 1 million shares for $38.3 million year-to-date. We remain well-capitalized in our position to support continued balance sheet growth and disciplined capital return. That concludes my remarks, and I will now turn it over to our Chief Credit Officer, John Martin, to discuss asset quality.

Thanks, Michelle, and good morning. My remarks begin on slide 20. Overall, the portfolio continues to perform within expectations and remains well diversified across commercial and consumer lending categories. Total loans ended the quarter at $15.5 billion. Commercial real estate concentration levels remain comfortably within regulatory guidelines, and our credit portfolios continue to largely perform in line with expectations. Moving to slide 21, second quarter asset quality was impacted by two notable credits. The larger of the two relationships was a $28.1 million participation in a syndicated credit to an authorized wireless retailer. Subsequent to quarter end, we received new company-specific information that led us to place the loan on non-accurral. While negotiations with the borrower remain active, the outcome has not yet been finalized. However, we expect to have substantially greater visibility into the likely resolution by the end of the fourth quarter. The second credit was a sponsor-financed $13.7 million loan to a commercial and residential roofing contractor that had been moved to the watch list for three quarters. It was placed on non-accrual in July after the sponsor informed us that they no longer intended to support the company. While meaningful in size, this credit is more representative of the type of periodic CNI migration we see from time to time within the commercial loan portfolio. As a result, non-accrual loans increased to $118.2 million and non-performing assets plus 90 days past due increased to $129.5 million or 0.83% of loans. Classified loans increased to $393.3 million from $357.1 million last quarter. While these metrics moved higher, the increase was driven primarily by a limited number of borrower relationships, most notably the authorized retailer and roofing contractor credits, rather than any broad-based deterioration across the portfolio. area. Looking ahead, we expect a meaningful portion of the lost content associated with these two non-accrual relationships to be realized through charge-offs during the third and fourth quarters. As a result, while current quarter charge-offs remained a modest 10 basis points annualized, we currently anticipate full-year 2026 net charge-off will trend into the 40 to 45 basis point range. Importantly, that expectation is largely driven by the resolution of these known credits and should not be interpreted as a change in our view of the broader portfolio, which continues to perform within expectations. Turning to slide 22, non-performing asset migration increased during the quarter with the new non-accruals totaling $53.6 million. The two relationships described on the prior slide represented the primary drivers of those additions. Offsetting activity included $17.7 million of upgrades and payoffs, along with $6.2 million of charge-offs and other resolution activity. These actions reflect continued active management of problem assets across the portfolio. In summary, the quarter was impacted by one significant relationship-specific credit event and another larger, more routine migration. We identified the issues, reserved appropriately, and continued to actively work the relationships. Outside of these credits, portfolio performance remained stable, charge-offs remained low, and we continued to believe the overall risk profile remained sound. We remain focused on proactive portfolio management, early identification of emerging risks, and maintaining the strong discipline that has consistently differentiated our organization. Thanks for your attention. I'll now turn the call back over to Mark Hardwick.

Thanks, John. Turning to slide 21, our long-term track record of shareholder value creation remains a key strength and a key priority for this management team. Slide 22 highlights our 11.5% total asset combined annual growth rate over the past decade, reflecting a consistent strategy over organic growth complemented by disciplined value accretive acquisitions that expand our demographic and geographic footprint. We look forward to building on our Midwestern strength throughout the rest of 2026 by focusing on our people, clients, products, and technology investments, or simply running the core bank. Seeing this strength translate into earnings per share and sustainable earnings growth and shareholder value remain our top priority. Thank you for your continued support and investment in First Merchants, and now we're happy to answer any questions that you may have.

Certainly. As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Our first question will come from the line of Daniel Tamayo of Raymond James. Your line is open, Daniel.

Thank you. Good morning, everyone. Good morning. Maybe just starting, I appreciate all the color on the two credits that drove the issues on the credit quality side this quarter. But seeing as one of them was from the shared national credit book, maybe for you, Mark, just curious, you know, kind of how you're thinking about that business line overall or that portfolio in terms of go forward from a go forward basis. Are you still comfortable with it? Are you still growing that business? And then if you have any maybe details on reserves of the rest of the book in terms of how that looks relative to the overall portfolio, that would be helpful.

Yeah, Danny, I'll start, and then if John or Mike want to add anything, they can. We still like the business and like the balances that we have on our financials. And it's really because we've focused on customers that are in our backyard that happen to be large enough to participate in a SNCC market. This particular customer is one where we've had a relationship with them. They're in the Michigan market, kind of in our backyard, are involved in a couple of other local businesses that are unrelated. And those are the types of credits where we tend to have great relationships with management and continuous dialogue. And I think that's reflective of the entire SNCC portfolio. We're not just buying credits to expand the balance sheet from outside of our core markets and really not even outside of our current markets where we don't have a relationship. focused on those customers that we're close to. The rest of the portfolio, I don't know that I have specific thoughts on it. It's not an area where we've experienced challenges in the past. And I would open it to these two guys if they have anything else to add.

Yeah, I would echo Mark's comments. This relationship expanded in ancillary businesses beyond the current exposure that was isolated to this particular borrower. You know, we've got other loans, deposits, and that is how we approach the shared national credit portfolio. Borrowers who, in aggregate, have more than $100 million in borrowings and have more than two banks make up that category. You can look at the total outstanding and the average balance, and it's relatively granular. So we try to approach it in a granular approach where we do use that as a lever to expand a relationship, and that really is our strategy.

Mike Stewart here, one last comment, all what Mark said, John said. That being said, we're doing a complete portfolio review of our shared national credit. We have to. We need to understand better asset coverage versus cash flow lending. So there will be analysis on that, but I want to reinforce what Mark said. We have access to management. There are companies in our backyard. We feel like we have an understanding of how we can work with them beyond just a purchase of a loan. It's clearly disappointing, but we'll do a portfolio review and make sure that we feel absolutely comfortable with our approach.

Thanks for all that color from all of you. Appreciate that. But I guess next for Michelle, just if you can give us – I know you mentioned that cost savings are on track for first savings, but any kind of outlook that you might be able to provide on the expense numbers and maybe how you're thinking about where that might land post-integration efforts?

So, you know, our quarterly run rate, I think the guidance that I gave last quarter was that we thought But through the remainder of the year, our total expense run rate would be between $111 and $114 million per quarter. And I still think that's good guidance. If you strip away some of the noise that we had this quarter, we kind of landed at that $111 spot. And so clearly with some hiring that we're doing and so forth, there will be a little bit more, a little bit higher expense balance. But I think that range is still good.

All right. Thank you for that. I appreciate it, Michelle. I'll step back.

Thank you. And our next question will be coming from the line of Russell Gunther of Stevens. Your line is open, Russell.

Hey, good morning, guys. First, please, just a quick follow-up on the expense commentary. Helpful to get the reiteration for the rest of this year. As we think about the go-forward, what's a safe, kind of normalized growth rate to assume based on franchise investment you're considering, hiring initiatives, et cetera?

Well, this year, just kind of a normal organic growth, it was between 3% to 5%. And that just reflects us investing in the business, investing in talent. You know, we've talked, I think, historically about some places like our asset-based lending team and other commercial hires that we've had. And I think that range on a go-forward basis will still hold true just because we will continue to do some hiring, invest in technology, et cetera.

Excellent, Michelle. thank you for for taking that one and then switching gears um to the margin it would be helpful to get a sense for how you're thinking about uh the back half of this year whether or not you guys are are contemplating any uh fed hikes in in in your outlook um and maybe just starting on the loan side where you expect yields to be able to trend uh begin there please no i'll start with margin.

So we're assuming no Fed rate changes through the remainder of the year. And if that's the case, we would expect margin to increase maybe a couple basis points in the back half of the year. We are seeing some spectacularly high CD specials from competitors in our markets. So pricing deposits is always a variable in terms of being able to maintain our deposit costs and so forth. But we've got some tailwinds. We've got some fixed rate assets, both on the loan and the bond side, that will be repricing. And so we feel pretty good about being able to achieve stability to up a couple basis points. And so, Mike, I don't know if you want to talk a little bit about loan yield. I mean, loan yield, when you look at our new and renewed loan yield, that's still above our overall portfolio yield. And so that's also helping to drive our net interest.

No, I think you gave a good sum in all that. I think that that will be consistent on a go-forward basis. Okay.

Great. Thanks for tackling both sides of that margin question for me. I'll step back.

Yeah, I really was pleased, though, to see the new and renewed. You said last quarter was 618 and up to 628 this quarter. And it does create momentum over the portfolio yield at 611.

And our next question will be coming from the line of Damon Del Monte of KBW. Damon, your line is open.

Hey, good morning, everyone. Hope you're all doing well today. Just wanted to start off with the income and maybe the outlook there, Michelle. You know, I think mortgage banking or gain on loan sales had a solid quarter. Just curious how the pipeline is shaping up here in the third quarter and kind of maybe what you could expect moving off of this quarter's $37.2 million level.

Yeah, I mean, I think for the full year, we would expect non-interest income to be up 10% over a prior year. You know, there was always a little bit of seasonality in the mortgage business, but we did have a really nice solid quarter with gains on sales of mortgages this quarter. I would expect the same next quarter as well.

Okay, great. And then I guess with regards to capital management, Maybe a question for Mark on kind of your thoughts on continuing with the buyback. Good to see you're active again here in the second quarter and capital levels remain healthy. Didn't know if the two credits, you know, weighed on your balancing act of how you allocate capital or not and if we could expect more buyback going forward.

Yeah, we expect to continue buyback activity through the remainder of the year, assuming our stock price stays in this similar range. And the $100 million approval that we received recently, both approval from the Fed and our board, was announced. And we just continue to generate capital. I mean, we need, call it 30% to 40% of it to support loan growth. Use about a third for dividends, and the rest is available for other purposes. And at least at this point, we think share repurchase is still a really good use of that capital. Okay, great.

Okay, I'll just leave those two questions and step back.

Thanks, Damon.

And our next question will be coming from the line of Brendan Nassau of Hove Group. Your line is open, Brendan.

Good morning, everybody. Hope you're doing well. Well, maybe to circle back to credit and the syndicated loan, can you just fill us in on where that credit was risk-graded last quarter? Like, what changed in their operations that drove the downgrade? And then if there are any other read-throughs from that situation to other commercial credits or other syndicated credits you have?

Okay. I'm sorry. I didn't catch your name. It's Brandon. Hey, Brandon. Brandon. So in the first quarter, we identified really the beginning of the issue and had moved it to our watch list. In the second quarter, we moved it to classified, the classified category. So that is a significant portion of that change in the classified numbers. We do have other exposure in the wireless retail space, but to different carriers and different issues. This one is specific to the particular carrier. So Mike mentioned we do portfolio reviews in our shared national credits, continue to do that, and have an understanding of the overall exposure.

I also just think it's fair to say the carrier has made a pretty dramatic shift in their retail distribution model, and it's impacting this customer directly. and the changes moved quickly, the impact of those changes became much more apparent late in the quarter, even subsequent to the quarter. And so just a little bit more color.

And Brent, I was just going to add that it was really in the last week of the quarter that it began to be very clear as to what the issues were, having then received additional information and subsequent to the first quarter that was present in the second quarter.

That's very helpful, Collin. Thank you. Maybe pivoting to kind of the first savings acquisition, you're six months or so into that deal now. I'm just kind of curious as you are on the ground for longer and longer anything new you've learned from having that franchise or anything new on kind of their specialty commercial verticals that you've seen on the ground that has changed over the course of the year?

Yeah, Mike Stewart here. That's a good question. I appreciate you asking because I didn't speak a lot to it. Our local commercial team down in Jeffersonville led by Eric Howard is off to a great start. I think we've done a wonderful job, he and his team, working with our existing clients and our commercial activity is good. It's actually grown in the quarter with their ability to continue to work with them. Our consumer book of business down there is doing reasonably well too. You see some attrition that's happening there in some units, but the overall balances are well within our model on what we think they should be post-legal close in February and post-integration in May and we've got a really nice marketing campaign and we're opening new accounts down there and managing through what I consider to be normal attrition then our verticals the SBA business continues to do well on it on that national level their originations were when you look at how they do the originations originations were basically flat to the first quarter and we We sell the guaranteed portion on a quarterly basis, and that activity is good. And that team is now working with the rest of the first merchant's footprint to be the fulfillment source for SBA solutions in Indiana, Michigan, Ohio, and that connectivity is good. The first lean HELOC business actually showed originations up about 10%, and that's a process where we mainly do originate and sell, so that activity is good. And then the triple net lease business actually had robust growth in the quarter as the individual that runs that has got some good activity there. So I feel like the overall specialty verticals are doing what we wanted to do, being stable providers of opportunity for balance sheet and or fee income. The team is pretty stable.

And then the opportunities for us to grow in southern Indiana in a core commercial bank, Midwestern-focused approach is off to a good start. awesome that's that's super helpful color mike uh all right thanks for taking my questions and our next question will be coming from the line of nathan race piper sandler your line is open yeah hi everyone good morning thanks for taking the questions just going back to credit for a second uh john when you just look at classified loans and how they've turned up by roughly 100 uh million over the last couple years you know curious if you can just kind of shed some light in terms of, you know, what's driving that increase? Are you guys just being tougher graders these days? Or is it just, you know, some changes in the complexion of the portfolio overall? And just kind of any thoughts on, you know, when we can maybe start to see classified loans start to trend lower?

Yeah, you know, it's interesting when you look over the last couple of years, a couple of things that I think about. One, we're a large organization at some level. We have added overall balances. So with those and a percentage basis, it has increased the absolute dollar figure. If you look at Q225, we're at 280. Today, we sit at 253. So we're actually down year over year. Now, having said that, higher interest rates in the investment real estate construction portfolio had an impact when that first kind of occurred so there's a lot of dynamics there I think we're consistent with our grading and you know we have a methodology for it and it derives the results that you're seeing I would argue that we're tougher with our grading than you know some of our peers but I'm a little biased okay that's helpful and Mark I think you've been pretty consistent in the last couple of quarters that, you know, you're not really interested in other acquisition opportunities and you guys are really internal focused.

But, you know, just curious to get some updated thoughts on kind of the M&A appetite these days in terms of, you know, some additional smaller opportunities or maybe anything more transformational along those lines.

Yeah, our focus is the same. We have a bank that we're proud of that has a powerful earnings engine behind it, and we're focused, like I said in my comments, about just executing, taking care of our employees and our customers and our communities and driving shareholder return. The activity is pretty quiet, I would say, in terms of just institutions in our three-state footprint that are looking or that are interested in doing something. And I guess if there was anything that, like, piques our attention, it's just if it's easy to digest and has a great deposit base and a low loan-to-deposit ratio. And I think every bank in the country is searching for those.

Right. Makes sense. And, Michelle, I apologize if I didn't catch it, but just any thoughts on the tax rate going forward?

Yeah, I think 13% would be a good effective tax rate to use. That's what we're expecting.

Okay, great. I appreciate all the color. Thanks, everyone.

Thanks, James.

And our last question will be coming from the line of Brian Martin of Brain Capital. Your line is open, Brian.

Hey, good morning, everyone. Morning, Brian. Hey, just maybe one or two from me. I think someone just got answered there, but Michelle, that fixed rate asset repricing, can you just remind me what that is? I know you mentioned in the call, I don't know that you mentioned the amount, or maybe I missed it if you did.

Yeah, so on the loan side, we have about $385 million over the next 12 months, and those are sitting at about, well, maybe about a $450, $460 rate, and so we've definitely got some upside there.

Okay. And then maybe just remind me on the – I joined late, so if it's something I can go back and listen to the transcript or if Mike can comment again, just on the pipeline and just the question earlier about the acquisition and kind of what that brings to the loan pipeline. Can you just comment about where the pipeline is today in terms of loans at a high level and just kind of where you're seeing strength or where you expect to see continued strength?

Sure, absolutely. On the consumer side, which includes our mortgage pipeline, that's really where the strength still is. Interest rate environment aside, it is up substantively over this time last year. It's a seasonal book of business, but we've got some great connectivity in Michigan, Indiana, Ohio. We've been investing in producers. Those producers are doing that, adding units in there. And the ability of our team to leverage a really efficient back office This allows us to continue to grow in the units of that. So the pipeline of mortgage is really strong going to the third quarter. Our commercial team pipeline, I view it as stable, stable to where we were at the end of the first quarter. And you saw we had really nice growth in the second quarter after a flat first quarter. And inside the book of business there, that pipeline is pretty evenly dispersed amongst our geographies. We're seeing really good growth in our Michigan market as those teams continue to take advantage of maybe some of the noise of the fifth, third Comerica integration, with commercial clients being a little confused and what ideas from us. And then with what Eric's been able to do in southern Indiana, the pipeline is nice in the southern Indiana franchise. It's also evenly dispersed amongst our investment real estate and our CNI portfolios that a year ago you might remember us talking about the addition of a new team of our asset base group and their pipelines, their production has been tremendous and their pipelines also remain strong as we go into the third quarter. So I view the commercial pipeline as stable. That's why I made my comment that I feel good about that mid-single-digit growth through this third and maybe fourth quarter as well.

Gotcha. That's super helpful, Mike. Thank you. And, Michelle, just maybe one back on the securities portfolio. You commented that the runoff is still going into the fund the loan growth, so a little bit of mixed improvement there. What, how much on the, I guess, where do you see the kind of longer term, where do you see the securities portfolio kind of size that up and where you'd like it to be as you draw it down a bit?

Yeah, I mean, generally our bond portfolio is about 15% of our total assets, which is really about where we are today. Of course, you know, that fair value is getting impacted by rate movement, and so we'll just continue to monitor it. But we do still plan at least through the remainder of this year to use the cash flows to fund loan growth.

Yeah. And the roll-off yields, did you give what those roll-off yields are on the securities portfolio?

Yeah, I believe it's 269.

269. And those are going into high fours or mid to high fours?

Well, no, because we're not buying bonds with that. We're putting it into loans. Oh, sorry.

Loans. Yeah, I'm sorry. I apologize. Jason. Okay.

Yeah, that's all.

Thank you for taking the questions.

All right. Thank you, Brian.

And I would now like to turn the call back to Mark for closing remarks.

Yeah. Thanks, everyone. We appreciate your investment in First Merchants and your interests in our company. The first half of the year has been a little noisy. You know, some things that we're excited about, some that we are disappointed by. But to have our acquisition complete and fully integrated, to have our loan sale complete, and to put that liquidity back to use at a much higher yield has been great for the business. Obviously, we're disappointed by the two commercial credits that really challenged the second quarter. But I'm really enthusiastic and excited about what the second half of 2026 should represent for our company. and really look forward to talking to you about a great second or a great third quarter in 90 days. So, again, we appreciate your time and your attention and look forward to talking to you in a few months. Thank you.

And this concludes today's conference. Thank you for your participation and have a great day. You may now disconnect.