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First Merchants Corp (NASDAQ:FRME)
Q4 2019 Earnings Call
Jan 30, 2020, 12:30 p.m. ET

Contents:

  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:

Operator

Good day, and welcome to the First Merchants Corporation Fourth Quarter 2019 Earnings Conference Call. [Operator Instructions]

This presentation contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act. Such forward-looking statements can be identified by the use of words like believe, expect or may and include statements relating to First Merchants' business plan, growth strategies, loan and investment portfolio, asset quality, risks and future costs. These statements are subject to significant uncertainties that may cause results to differ materially from those set forth in such statements, including changes in economic conditions,

The ability of First Merchants to integrate recent acquisitions, changes in regulations and requirements of the company's regulators, litigation changes in the creditworthiness of customers, fluctuation in the market's rates of interest and other risks and factors identified in First Merchants' filings with the Securities and Exchange Commission. First Merchants undertakes no obligation to update any forward-looking statement, whether written or oral, relating to the matters discussed in this presentation or press release. In addition, the company's past results of operations do not necessarily indicate its anticipated future results.

I would now like to turn the conference over to Mike Rechin, President and CEO. Please go ahead.

Michael C. Rechin -- President And Chief Executive Officer

Thanks, Ailey, and thanks to everyone in advance for they joined us for our call. Welcome to the earnings conference call and webcast for the fourth quarter ending December 31, 2019. Joining me this afternoon are Mark Hardwick, our Chief Operating Officer and Chief Financial Officer; as well as John Martin, our Chief Credit Officer. First Merchants released our earnings in a press release this morning at approximately 8:00 a.m. Eastern Time, and our presentation today speaks to material from that release. The directions that point to the webcast were also contained at the back end of the release, and my comments begin on page four, a slide titled, Fourth Quarter 2019 Highlights. First Merchants posted $47.8 million in net income, or $0.87 a share, by comparison with $41.7 million earned in the fourth quarter of 2018 or $0.85 a share. In November,

We were pleased to complete a well-executed systems conversion of Monroe Bank & Trust Financial in the First Merchants, very satisfying for our clients and our teammates to get off to a great run rate, and we think we've accomplished that. Included in the results for the quarter were integration expense totaling $1.9 million or $0.03 per share. We had a strong fourth quarter with marketplace execution delivering some of the growth that we were looking for. You might recall in late October, we talked about having a full pipeline going into the quarter. Much of that found its way through closings onto our balance sheet and virtually every credit and loan category, including our deposit gathering. And so what we saw was organic loan growth of 161 million, a 7.8% annualized growth rate, and organic non maturity deposit growth of $154 million, a 7.7% annualized growth rate. Our third quarter, also strong in my view, included $0.17 of acquisition expense, whereas our fourth quarter included only $0.03.

It allows, as the bottom bullet point on page four captures, a resumption of our high-performance metrics, whether you look at our return on average assets of over 1.5%, nearly 11% return on average equity or about a 51% efficiency ratio even to include the $0.03 of acquisition expense included. And so a strong fourth quarter plays into a full year, which I'll speak on, again, on page five. And some of the resumption of metrics that I was talking about might be seen most readily either in Mark's comments, which follow mine or in one of the trended quarter material in the press release financials. So on page five, key takeaways from our full year 2019 performance. Record net income of $164.5 million, a 3.3% increase over 2018's net earnings of $159.1 million.

Earnings per share of $3.19, excluding $0.21 of all-in full year acquisition expense, which would have totaled to a normalized $3.40, in comparison to 2018's earnings of $3.22 per share. Talked all throughout the year about our excitement to expand our franchise in the Michigan. That actually took place on the legal event, which was September one and the fourth quarter then capturing four month -- or all three months in the full year, capturing four months of activity from our time in Michigan. The acquisition expense, as I referenced earlier, was $13.7 million pre-tax or $0.21 per share. Our balance sheet and assets grew 26% over 2018 to $12.5 billion. Serving a healthy economy; healthy communities; disciplined market coverage throughout the year; produced organic loan growth of $507 million, a 7% growth rate; organic deposit growth of $979 million, a 12.6% growth rate.

Our tangible book value increased to $21.94 a share or 14.7% over year-end 2018. Mark is going to pick up from here and get a little deeper into the financials.

Mark K. Hardwick -- First Merchants Corporation

Thanks, Mike. My comments will start on slide seven, where total assets, on Line 7, increased by $2.6 billion or 26% since year-end 2018. Total loans, on Line 2, have increased by $1.2 billion this year or 17.1%. Acquired loans totaled $733 million as organic growth totaled $507 million or 7%, as Mike mentioned. Investments, on Line 1, increased by $963 million or nearly 59% from year-end due to strong deposit growth and acquired liquidity. And additionally, on Line four, goodwill and intangibles increased by $109 million net of amortization due to the purchase of Monroe Bank & Trust on September 1, 2019. The composition of our $8.5 billion loan portfolio, shown on slide eight, continues to produce strong loan yields. The loan portfolio yield for the fourth quarter of 2019 totaled 5.19%, down from the year-to-date average of 5.27%. As the graph on the right illustrates, 66% of our loans are variable, with half for pricing daily, demonstrating the asset sensitivity of our bank.

On slide nine, our investment portfolio has a longer than pure duration, which is a good offset to our variable rate loan portfolio. And during the year we've increased the portfolio to 2.6 billion from 1.6 billion a year in deploy excess liquidity and protect the bank against falling interest rates. As of December 31 2019, or annualized gain total 71.5 million and the portfolio yield totaled 3.23%.On slide 10, total deposits increased by 2.1 billion, or 26.9%. Mineral Bank and Trust accounted for 1.1 billion of the growth, while organic deposit gross total 979 million on annualized 12.6%. common equity online seven is increased by 378 million during 2019. beyond normal earnings, dividends and other comprehensive income fluctuations, the all stock purchase of Monroe Bank and Trust increased equity by 230 million. Additionally, we repurchased $22 million of stock throughout 2019. Capital and liquidity ratios are positioned well for the future, and management is pleased with the structure of our balance sheet.

Our loan-to-deposit ratio totals 86% of our loans -- loan-to-asset ratio and 68% of tangible common equity totals 10.16%. As I previously mentioned, the mix of our deposits, on slide seven, is the true strength of our company. Fourth quarter deposit costs totaled 118 basis points, down from year-to-date cost of 126 basis points. Our deposit cost also increased by 15 -- or decreased by 15 basis points in the fourth quarter compared to the third quarter. This is our first decrease in interest expense since the Fed started raising interest rates -- the Fed funds rate back in June of 2017. Additionally, we're pleased that interest expense for the quarter declined by nearly $1 million, even after adding an additional two months in the fourth quarter for Monroe. Our regulatory capital ratios, on slide 12, are above the regulatory definition of well-capitalized and our internal targets, providing capital strength and flexibility into the future.

The corporation's net interest margin, on slide 13, reflects a growing net interest income line, driven by -- driven in 2019 by balance sheet growth. 2019 full year net interest margin totaled 3.69% from 2018's total of 4%. Net interest margin for the fourth quarter equaled the third quarter of 3.62%. We don't anticipate the fair value accretion will continue to run as high as the 18 basis points that we recognized in the fourth quarter throughout all of 2020, but we feel good about our deposit pricing strategies and our ability to continue to decrease our interest costs going forward. Total noninterest income, on slide 14, totaled $86.7 million as of December 31, 2019, an increase of $10.2 million or 13.3%. Customer-specific line items accounted for $10.5 million of increase in total noninterest income. Customer-specific line items driving the improved revenue include growth in derivative hedge income of $2.9 million, fiduciary and wealth management fee increases of $2.7 million, card payment fees of $2.2 million and service charges on deposits of $2 million.

Noninterest expense, on slide 15, totaled $246.8 million in 2019, a $26.8 million increase from 2018. Of the increase, merger-related expenses totaled $13.7 million. Now on slide 16, as Mike mentioned in his opening remarks, on Line 9, EPS totaled $3.19 for the year ended 12/31/2019. and when adjusted for merger and acquisition expenses of $0.21, EPS totaled $3.4 -- $3.40, an increase of 5.6% over 2018. On Line 10, the efficiency ratio for the year totaled 52.73%. And when adjusted -- as highlighted in the footnotes, when adjusted for acquisition expense, totaled 49.69%. on slide s 17 and 18, you can see the year's quarterly results and the corresponding acquisition expense adjustment. We're very pleased that we can follow up a record 52% improvement in earnings per share in 2018 with another positive growth story. On slide 19, our total compound annual growth rate of tangible common equity per share is 10.13%, going all the way back to 2010. And our dividend yield is just over 2.5%.

Thanks for your attention, and John Martin will discuss loan portfolio composition and related asset quality trends.

John J. Martin -- Executive Vice President And Chief Credit Officer

All right. Thanks, Mark, and good afternoon. I'll provide a year-end and quarterly summary of the loan portfolio, as Mark mentioned, review the asset quality and the asset quality roll forward, cover the allowance and provisioning then close with a few remarks on CECL and the credit environment. Turning to slide 21, the pace of loan growth picked up in the quarter, growing $161 million or 7.8% annualized for the quarter. Growth came from commercial and industrial lending, on Line 1, construction lending, on Line 3, and public finance, on Line 7.

Our sponsor finance business is now roughly $320 million in outstandings and $420 million in commitments. And that's part of, and is included in, the C&I loans, on Line 1. These balances are in commercial and industrial loans, on Line 1, and are highlighted doing -- I'm highlighting it due to our growing activity in the unit over the last several quarters and years. A little more color, construction loans were up $117 million, on Line 3, as fundings drove growth in the quarter, while our originate stabilized and moved to the permanent market model, saw a reduction in CRE nonowner-occupied, on Line 4, with net reductions of $109 million for the quarter from projects moving to the secondary market and the sale of properties.

On Line 7, public finance grew by $75 million, where we saw several larger opportunities in the public finance book, where we generally take more interest rate risk with longer-term fixed assets, while credit risk is mitigated by the taxing abilities of the various governments and their agencies. Turning to asset quality on slide 22. The loan portfolio's asset quality remains strong. On Line 1, nonaccrual loans were down $6.7 million for the quarter and $10.1 million for the year, even after adding roughly $5.5 million from the acquired Michigan portfolio last quarter. To provide a little color behind the quarterly change, the decline resulted largely from the refinance and payoff of an agriculture relationship, which represented $3.5 million in outstandings. Moving down the slide to Lines two and three. Other real estate-owned and restructured loans were mostly unchanged, increasing $400,000 and $200,000, respectively, while 90 days past due, were unchanged at only $100,000.

On Line 8, classified loans, are those loans with a regulatory definition of a well-defined weakness, were up in the quarter $18 million and have been relatively stable hovering around 2.1% to 2.4% of loans over the last several years. Turning to slide 23, which reconciles the migration of nonperforming assets. We started the quarter, in the far right column titled 2019, with $31 million in NPAs and 90-day delinquencies. We added $16.7 million of new nonaccrual loans, which includes the $5.5 million from the Michigan portfolio I mentioned earlier. We resolved $12.8 million of the same, on Line 3, with $7.4 million moving from nonaccrual loans to ORE, on Line 4, resulting largely from a $6 million or 63% participation in a skilled nursing facility. Dropping down to Line 5, we had gross charge-offs of $6.6 million, which netted to a $10.1 million decrease in nonaccrual loans on Line 6.

And dropping down to Line 8, you can see the net effect of the transfer to other real estate-owned of the $6 million property I just mentioned, increasing other real estate-owned by $7.5 million for the year. The net results of the movement was an annual reduction of $6.9 million of ending NPAs and 90-day delinquencies, on Line 13, or on Line 13 with ending nonperforming assets of $24.4 million on Line 14, or roughly 22% decline for the year. Moving then to slide 24, which highlights the ALLL and fair value summary. We started the quarter with an allowance of $80.6 million or 0.97% of loans and $800,000 in net charge-offs with $500,000 in provision expense. And this leaves us with a final incurred loss allowance of $80.3 million, down $300,000 to 0.95% of loans, which includes specific reserves of $700,000 and an allowance coverage to nonaccrual loans of 503%. Just a quick note.

This slide will materially change next quarter, of course, with CECL, current expected credit losses model for the allowance. As the $36.6 million of fair value adjustments gets partially reallocated to the allowance, we would expect the allowance next quarter to increase between 55% and 65% with coverage of around 1.5% of loans. Finally, turning to and summarizing on slide 25. Asset quality remains solid with improving NPA trends for the quarter and the year. We've had good loan growth with originations across the balanced mix of the commercial portfolio. The Michigan portfolio is performing as expected from our due diligence work, supported by an engaged and talented team of bankers. And after journey, our CECL work is complete with our auditors and model validators working on the completion of their work. And then finally, I would mention that, a moment ago -- as I mentioned a moment ago, with an expected increase, the allowance is -- will increase between 55% and 65% or roughly 1.5% of loans, and to include another $18 million in other liabilities for unfunded commitments.

That concludes my remarks. And Mike, I'll turn it back over to you.

Michael C. Rechin -- President And Chief Executive Officer

Thank you, John. I'm going to speak to the bullet points on page 27. The slide is titled, Looking Forward. It starts with a couple of highlight items from some of John's closing thoughts around Michigan Bank & Trust having joined us and First Merchants' presence now in the Michigan market. With our conversion and change event going smoothly, we feel like we can get after 2020 opportunities strong. We like our leadership that's in place, Tom Myers and executive with Monroe Bank & Trust will head up as Region President. Our effort there, Doug Chaffin, you might recall from an 8-K filed at the end of last quarter, former Monroe Bank & Trust CEOs joined First Merchants' Corporate Board. So we feel like we have a lot of the leadership from that company working on our behalf now and Tom's team is ready to go.

Relationship management and growth point speaks to a clear desire to get our clients comfortable with the change event, retain and grow our client relationships, and we're ready to compete for new ones. When I think about 2020, I think about the maturation of our expanded community lending model. Throughout our larger markets, our primary metro markets, these are kind of a mortgage-led effort, intended to initiate new bank relationships. So we start out 2020 optimistic coming off of a strong fourth quarter. John talked about the originations in the quarter. You can see the year -- quarter end balances had kind of higher end of our range, organic growth rates, which we kind of thought would happen based on the pipeline, knowing that it's an imperfect science. So when you start the year with the condition of our clients, the condition of our communities we look to grow our net interest income at the top line, use pricing discipline, Mark Hardwick spoke to it, both in credit extension and in deposit gathering, pipeline we have now supports our optimism,

I think. So we're looking at other strategic items. Our digital delivery, I think we're very aware of the changing client preferences around how they use our company, and so we're evaluating where our ongoing vendor partnerships go, our ongoing technology investment in service delivery is going to be made. I ended on a positive note. Our team was proud that our 2019 results affirm our culture of high performance, as Forbes Magazine lists First Merchants in its top five for achievement, three years running. So we like the momentum that we have.

And Ailey will open to take questions at this point.

Questions and Answers:

Operator

[Operator Instructions] Our first question will come from Scott Siefers with hyper sampler.

Scott Siefers -- Piper Sandler -- Analyst

Afternoon guys, thanks for taking the question. Mark, first question for you. Just one regarding the core margin, I guess, some might have expected it to hold it in a little better, I guess, just curious to your thoughts as to how it compared to what you guys were hoping to see. And then second question is, do you think it can stabilize from here? And when I refer to the core margin just pulling out the purchase accounting accretion.

John J. Martin -- Executive Vice President And Chief Credit Officer

Yes, we were pleased by the stated margin because fair value accretion was strong. Like I said in my comments, I don't expect to see 18 basis points per quarter going forward. And so we're going to have to rely on a continued reduction of our interest expense on deposits going forward. And we were really pleased to see the 15 basis point reduction this quarter, and we feel like those strategies still have some room as we continue to execute across the board on all of our deposits from a position of strength with great liquidity.

Scott Siefers -- Piper Sandler -- Analyst

Okay. And I guess, when you -- so if we look at the, sort of 3.44% that you're at on a core basis. Is that -- given the opportunities on the deposit cost side, is that something you think you can hold in that range going forward, assuming no more rate moves by the Fed?

Mark K. Hardwick -- First Merchants Corporation

Yes. I think that qualification is a good one. Assuming no more rate moves, we feel great about the current level of our margin on a go-forward basis.

Scott Siefers -- Piper Sandler -- Analyst

Okay. And then I know the purchase accounting benefits will be less than this quarter's 18 basis points. But do you have a sense, is it going to dip back down to sort of that prior 9% to 10% expectation that we would have before Monroe? Or does it kind of meet somewhere in the middle and then start to come down ratably over time?

Mark K. Hardwick -- First Merchants Corporation

Yes, we were anticipating more like 12 basis points as you go through 2020. And -- but I would say, after every acquisition, for the -- especially for the first 12 months, it's -- it can be unpredictable as some of the -- some payoffs have -- tend to drive that number higher in the first 12 months of the year.

Michael C. Rechin -- President And Chief Executive Officer

Yeah. Okay. Thank you very much.

Operator

Our next question comes from Terry McEvoy with Stephens.

Terry McEvoy -- Stephens -- Analyst

Good afternoon.

Mark K. Hardwick -- First Merchants Corporation

Hi, Terry, how are you?

Terry McEvoy -- Stephens -- Analyst

Great, thank you. Capital ratios, as you mentioned, well above your targets. I was wondering if you could just rank order capital priorities as you think about utilizing that excess capital going forward.

Mark K. Hardwick -- First Merchants Corporation

Well, organic growth is always the highest priority, but it tends to use about 1/3 of the earnings that we produce. Our payout ratio typically is about 1/3 of earnings. And so I would anticipate keeping it at that type of level. And then the thing we added in 2019 was the ability to do some share repurchases that we've really been out of the market, from a buyback perspective, for quite some time. And so we're encouraged by our ability to use the remaining -- what we had about remaining $52 million to use in 2020 on the stated program or $53 million on the stated program that we had of $75 million. And we feel like we've had some nice opportunities to put that to work, at least in the first month of 2020.

So our price has allowed for some good buying opportunities. And then we would always like to use some of our excess capital for cash and acquisitions. And our history does show that we have a preference for that. I think our last five acquisitions have been all stock. But on a go-forward basis, we would anticipate, as long as the seller is interested, we'd love to use cash for as much as up to 20% to 25% of the purchase price.

Terry McEvoy -- Stephens -- Analyst

And then just as a follow-up, John, that $36.6 million fair value adjustment, you said a portion of that moves into the ACL. I was wondering if you could quantify that as they just try to work through and think about the capital impact from CECL overall.

John J. Martin -- Executive Vice President And Chief Credit Officer

Yes. Well, I'll take the first half of the question, with the capital, I'll leave to mark. But what I would say, Terry, is that number is around $7 million that moves in -- moves out.

Mark K. Hardwick -- First Merchants Corporation

And the range that we've communicated, including the amount that goes to other expense, I guess, for the first quarter, all goes through other comprehensive income. But if you take the entire amount that we'll be reserving, and it's between 33 to 38 basis points on tangible common equity and it decreases the tangible book value per share by around -- somewhere between $0.76 and $0.87.

Operator

Our next question will come from Damon DelMonte with KBW.

Damon DelMonte -- KBW -- Analyst

Hey, good afternoon guys. How's it going?

Mark K. Hardwick -- First Merchants Corporation

Good day, man. How are you?

Damon DelMonte -- KBW -- Analyst

Good. Thanks. I'm just to kind of follow up on that -- the CECL question. Mark, how are you thinking about the provision level now going forward, just given the work you guys have done on the implementation of this?

Mark K. Hardwick -- First Merchants Corporation

Well, the allowance, as a percent of loans, will be higher. So on a go-forward basis, we would anticipate that we would have some higher level of provisioning. But it does depend on the categories that we grow. It's much more granular in terms of the calculation, and we have different allocations for different asset categories.

John J. Martin -- Executive Vice President And Chief Credit Officer

And Damon, this is John. I might add that going forward, we'll see some volatility just out of the economic model that the allowance is tied to. And you can see today our allowance, as a percentage of loans, as Mark was just referencing, is roughly 95 basis points of model is that we just -- as I described in my prepared remarks, is going to be closer to the 1.5%. So you'll see some change from that going forward. So between the economic model, the change or the delta in that percentage of coverage or the percentage of total loans as well as just what happens to credit in general, it's going to add some volatility to it, where maybe not so much in the past.

Terry McEvoy -- Stephens -- Analyst

Okay. Like this past year, I think you guys averaged around $700,000 for provision expense, which was probably on the lower side, the year before that, maybe closer to $2 million. So when you say, higher than what we've seen normally, do you mean like off of this past year? Or are you talking -- if you look back over the last few years and take that average and then kind of go above that?

John J. Martin -- Executive Vice President And Chief Credit Officer

Well, I would say, it's probably back the $2 million number is probably closer to. If you just do the math, if you took our last quarter and ran the $161 million and did 1.5%, you can start to see it get closer to that number. It's a real just lose way to think about it.

Michael C. Rechin -- President And Chief Executive Officer

Yes, I think we're going to learn. This is Mike. I think we're going to learn like a lot of other institutions learn, but based on the type of credit that we originate and a relatively steady quality of asset condition, I think John's figure looks more like '18's quarterly numbers, yes.

Damon DelMonte -- KBW -- Analyst

Okay. That's helpful. And then, I guess, with respect to the outlook for expenses here, conversion occurred in the end of the fourth quarter, I believe, right? Or no, I'm sorry, is it occurring in the first quarter?

Mark K. Hardwick -- First Merchants Corporation

No the conversion was in November.

John J. Martin -- Executive Vice President And Chief Credit Officer

Yes.

Damon DelMonte -- KBW -- Analyst

Okay. November. So as we look at the -- if we take out the $1.9 million of integration charges this quarter kind of puts the core number around $63.3 million. So Mark, how do we think about that as we go through 2020?

Mark K. Hardwick -- First Merchants Corporation

Yes. Last quarter, I mentioned that we thought that a good run rate was in the mid-60s. And I would say, if you take that $63.3 million that you just adjusted to, we know FDIC expense is going to be $1 million higher next quarter. And then we have a number of strategies that we've laid out for 2020 that where we're going to invest some money, mainly just in the growth of the business. And so it's pretty easy for us to look at that total and get closer to $65 million a quarter than the $63 million.

Damon DelMonte -- KBW -- Analyst

Okay. All right. That's great. All right. That's all that I had for now. Thank you very much.

Mark K. Hardwick -- First Merchants Corporation

You're welcome. Thanks, Damon.

Operator

Our next question will come from Daniel Tamayo with Raymond James.

Daniel Tamayo -- Raymond James -- Analyst

Good morning, guys.

Michael C. Rechin -- President And Chief Executive Officer

Daniel, how are you?

Daniel Tamayo -- Raymond James -- Analyst

Just wanted to touch on kind of the same question as Damon, but on the fee side. You have some gains in 2018, which will probably -- could subside in 2019. So what are you thinking about a kind of a good starting point for the fee base in 2020?

Michael C. Rechin -- President And Chief Executive Officer

I'm looking at an itemized quarterly composition of our noninterest income. So maybe you're looking at the same thing. It's one of the page s in our release. Our service charges, we're -- I look at the customer-centric fees, whether it's service charges, which were $6.3 million in the fourth quarter, our wealth business produced $5.3 million, almost $5.4 million card fees should be uninterrupted until we get to the third quarter when the Durbin compromise kicks in. Our mortgage business ought to stay strong. We like the pipeline there. Our hedges came down a little bit in the fourth quarter from a peak, an all-time peak in the third quarter. We still expect it to be a 7-figure number because of the interest rate environment. I didn't mean to get that granular. So it was $24.2 million. Last quarter, I like the number. Our other income, which tends to capture miscellaneous items was really low in the fourth quarter. Otherwise, the fees that I can link back to customer value activities was high. So I like the number. I think it's $24 million to $25 million.

Daniel Tamayo -- Raymond James -- Analyst

Okay. I mean, the mortgage, the gain on sale number of $2.6 million you've been -- you like that going forward even with a slowdown in volumes?

Mark K. Hardwick -- First Merchants Corporation

About that neighborhood because -- so our history with Monroe is short. It's only four months, but I think you have to factor in that some of the third quarter line items captured one month of Monroe activity and the fourth quarter captured three months, and you have a little bit of seasonality in that line item. But I think the full benefit of Monroe, we're just getting our arms around ourselves in terms of the way it plays out seasonally. But we're going to earn fees.

Operator

This concludes our question-and-answer session. I would like to turn the conference back over to Mike Rechin for any closing remarks.

Michael C. Rechin -- President And Chief Executive Officer

It would just be one of appreciation for the listening, but more feeling on our part that we get to continue the performance that we've been posting for a couple of years, and certainly, most recently through 2019. Take all of that, plus what Monroe brings to us for a strong start for First Merchants in 2020. I appreciate your time. Talk to you in a couple of months.

Operator

[Operator Closing Remarks]

Duration: 36 minutes

Call participants:

Michael C. Rechin -- President And Chief Executive Officer

Mark K. Hardwick -- First Merchants Corporation

John J. Martin -- Executive Vice President And Chief Credit Officer

Scott Siefers -- Piper Sandler -- Analyst

Terry McEvoy -- Stephens -- Analyst

Damon DelMonte -- KBW -- Analyst

Daniel Tamayo -- Raymond James -- Analyst

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