MICHIGAN CITY, Ind., July 24, 2024 (GLOBE NEWSWIRE) -- (NASDAQ GS: HBNC) – Horizon Bancorp, Inc. ("Horizon" or the "Company"), the parent company of Horizon Bank (the "Bank"), announced its unaudited financial results for the three and six months ended June 30, 2024.

Net income for the three months ended June 30, 2024 was $14.1 million, or $0.32 per diluted share, compared to net income of $14.0 million, or $0.32, for the first quarter of 2024 and compared to net income of $18.8 million, or $0.43 per diluted share, for the second quarter of 2023.

Net income for the six months ended June 30, 2024 was $28.1 million, or $0.64 per diluted share, compared to net income of $37.0 million, or $0.85, for the six months ended June 30, 2023.

Second Quarter 2024 Highlights

Net interest income increased for the third consecutive quarter to $45.3 million, compared to $43.3 million in the linked quarter of 2024. Net interest margin, on a fully taxable equivalent ("FTE") basis¹, expanded for the third consecutive quarter to 2.64%, compared to 2.50% in the linked quarter of 2024.

Total loans held for investment ("HFI") were $4.8 billion at period end, increasing by 4.4% during the quarter, led by organic commercial loan growth of $154.8 million, or 5.6% in the quarter.

Credit quality continues to perform well, with non-accrual loans declining $0.8 million, to $18.3 million at June 30, 2024 from March 31, 2024. Annualized net charge-offs remain low, at 0.05% of average loans during the second quarter. Provision for loan losses of $2.4 million primarily reflected continued loan growth in the quarter.

Deposits totaled $5.6 billion at period end, increasing by 0.9% during the quarter. Non-interest bearing deposit balances at June 30, 2024 were relatively consistent with balances at March 31, 2024.

"We are proud of the Company's performance during the second quarter, which was highlighted by sequential growth in revenue and pre-tax pre-provision income resulting from the strategic shift of Horizon's balance sheet toward a more profitable earning asset mix, and diligent expense management. Importantly, the previously discussed balance sheet efforts drove improving loan yields, which coupled with the relative stability of our funding costs, yielded 14 basis points of net interest margin expansion in the quarter," President and Chief Executive Officer Thomas M. Prame said. "In-market businesses and consumers remain at the center of Horizon's strong credit performance and low-cost deposit franchise, and our Indiana and Michigan markets continue to provide excellent opportunities for organic growth. We are pleased with our performance during the first half of 2024, and remain committed to enhancing our financial performance throughout 2024."

_________________________

¹ Non-GAAP financial metric. See non-GAAP reconciliation included herein for the most directly comparable GAAP measure.


Financial Highlights
(Dollars in Thousands Except Share and Per Share Data and Ratios, Unaudited)
	Three Months Ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2024			2024			2023			2023			2023
Income statement:
Net interest income	$	45,279		$	43,288		$	42,257		$	42,090		$	46,160
Credit loss expense		2,369			805			1,274			263			680
Non-interest income		10,485			9,929			(20,449	)		11,830			10,997
Non-interest expense		37,522			37,107			39,330			36,168			36,262
Income tax expense		1,733			1,314			6,419			1,284			1,452
Net income	$	14,140		$	13,991		$	(25,215	)	$	16,205		$	18,763

Per share data:
Basic earnings per share	$	0.32		$	0.32		$	(0.58	)	$	0.37		$	0.43
Diluted earnings per share		0.32			0.32			(0.58	)		0.37			0.43
Cash dividends declared per common share		0.16			0.16			0.16			0.16			0.16
Book value per common share		16.62			16.49			16.47			15.89			16.25
Market value - high		12.74			14.44			14.65			12.68			11.10
Market value - low		11.29			11.75			9.33			9.90			7.75
Weighted average shares outstanding - Basic		43,712,059			43,663,610			43,649,585			43,646,609			43,639,987
Weighted average shares outstanding - Diluted		43,987,187			43,874,036			43,649,585			43,796,069			43,742,588
Common shares outstanding (end of period)		43,712,059			43,726,380			43,652,063			43,648,501			43,645,216

Key ratios:
Return on average assets		0.73	%		0.72	%	(1.27		)%		0.81	%		0.96	%
Return on average stockholders' equity		7.83			7.76			(14.23	)		8.99			10.59
Total equity to total assets		9.18			9.18			9.06			8.71			8.91
Total loans to deposit ratio		85.70			82.78			78.01			76.52			74.85
Annualized non-interest expense to average assets		1.94			1.90			1.98			1.81			1.86
Allowance for credit losses to HFI loans		1.08			1.09			1.13			1.14			1.17
Annualized net charge-offs of average total loans⁽¹⁾		0.05			0.04			0.07			0.07			0.04
Efficiency ratio		67.29			69.73			180.35			67.08			63.44

Key metrics (Non-GAAP)⁽²⁾:
Net FTE interest margin		2.64	%		2.50	%		2.43	%		2.41	%		2.69	%
Return on average tangible common equity		10.18			10.11			(18.76	)		11.79			13.94
Tangible common equity to tangible assets		7.22			7.20			7.08			6.72			6.91
Tangible book value per common share	$	12.80		$	12.65		$	12.60		$	12.00		$	12.34


⁽¹⁾Average total loans includes loans held for investment and held for sale.
⁽²⁾Non-GAAP financial metrics. See non-GAAP reconciliation included herein for the most directly comparable GAAP measures.

Income Statement Highlights

Net Interest Income

Net interest income was $45.3 million in the second quarter of 2024, compared to $43.3 million in the first quarter of 2024, driven by net FTE interest margin expansion during the quarter. Horizon's net FTE interest margin¹ was 2.64% for the second quarter of 2024, compared to 2.50% for the first quarter of 2024, attributable to the favorable mix shift in average interest earning assets toward higher-yielding loans against relatively stable costs of interest bearing liabilities. Interest accretion from the fair value of acquired loans did not contribute significantly to the second quarter net interest income, or net FTE interest margin.

Provision for Credit Losses

During the second quarter of 2024, the Company recorded a provision for credit losses of $2.4 million. This compares to a provision for credit losses of $0.8 million during the first quarter of 2024, and $0.7 million during the second quarter of 2023. The increase in the provision for credit losses during the second quarter of 2024 when compared with the first quarter of 2024 was primarily attributable to loan growth.

For the second quarter of 2024, the allowance for credit losses included net charge-offs of $0.6 million, or an annualized 0.05% of average loans outstanding, compared to net charge-offs of $0.4 million, or an annualized 0.04% of average loans outstanding for the first quarter of 2024, and net charge-offs of $0.3 million, or an annualized 0.04% of average loans outstanding, in the second quarter of 2023.

The Company's allowance for credit losses as a percentage of period-end loans HFI was 1.08% at June 30, 2024, compared to 1.09% at March 31, 2024 and 1.17% at June 30, 2023.

Non-Interest Income

For the Quarter Ended	June 30,		March 31,		December 31,			September 30,		June 30,
(Dollars in Thousands)	2024		2024		2023			2023		2023
Non-interest Income
Service charges on deposit accounts	$	3,130	$	3,214	$	3,092		$	3,086	$	3,021
Wire transfer fees		113		101		103			120		116
Interchange fees		3,826		3,109		3,224			3,186		3,584
Fiduciary activities		1,372		1,315		1,352			1,206		1,247
Gains (losses) on sale of investment securities		—		—		(31,572	)		—		20
Gain on sale of mortgage loans		896		626		951			1,582		1,005
Mortgage servicing income net of impairment		450		439		724			631		640
Increase in cash value of bank owned life insurance		318		298		658			1,055		1,015
Other income		380		827		1,019			964		349
Total non-interest income	$	10,485	$	9,929	$	(20,449	)	$	11,830	$	10,997

Total non-interest income was $10.5 million in the second quarter of 2024, compared to $9.9 million in the first quarter of 2024, due primarily to increased interchange fees and higher realized gain on sale of mortgage loans.

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¹ Non-GAAP financial metric. See non-GAAP reconciliation included herein for the most directly comparable GAAP measure.

Non-Interest Expense

For the Quarter Ended	June 30,		March 31,		December 31,		September 30,		June 30,
(Dollars in Thousands)	2024		2024		2023		2023		2023
Non-interest Expense
Salaries and employee benefits	$	20,583	$	20,268	$	21,877	$	20,058	$	20,162
Net occupancy expenses		3,192		3,546		3,260		3,283		3,249
Data processing		2,579		2,464		2,942		2,999		3,016
Professional fees		714		607		772		707		633
Outside services and consultants		3,058		3,359		2,394		2,316		2,515
Loan expense		1,038		719		1,345		1,120		1,397
FDIC insurance expense		1,315		1,320		1,200		1,300		840
Core deposit intangible amortization		844		872		903		903		903
Other losses		515		16		508		188		134
Other expense		3,684		3,936		4,129		3,294		3,413
Total non-interest expense	$	37,522	$	37,107	$	39,330	$	36,168	$	36,262

Income Taxes

Horizon's effective tax rate was 10.9% for the second quarter of 2024, as compared to 8.6% for the first quarter of 2024. The sequential increase in the effective tax rate brings the year-to-date effective tax rate to 9.8%, consistent with the Company's current estimated annual effective tax rate.

Balance Sheet

Total assets increased by $56.8 million, or 0.7%, to $7.91 billion as of June 30, 2024, from $7.86 billion as of March 31, 2024. The increase in total assets is primarily due to increases in gross loans HFI of $204.7 million, or 4.4%, to $4.8 billion as of June 30, 2024, compared to $4.6 billion as of March 31, 2024. Loan growth during the period was partially offset by a decrease in fed funds sold of $127.3 million, or 78.7%, to $34.5 million as of June 30, 2024, from $161.7 million as of March 31, 2024.

Total investment securities decreased $29.7 million, or 1.2%, to $2.4 billion as of June 30, 2024, from $2.5 billion as of March 31, 2024, primarily as a result of normal pay-downs and maturities. There were no purchases of investment securities during the second quarter of 2024.

Total loans HFI and loans held for sale increased to $4.8 billion as of June 30, 2024 compared to $4.6 billion as of March 31, 2024, led by organic commercial loan growth of $154.8 million.

Total deposit balances increased by $50.3 million, or 0.9%, to $5.6 billion on June 30, 2024 when compared to balances as of March 31, 2024.

All other interest bearing liabilities at June 30, 2024, primarily comprised of Federal Home Loan Bank of Indianapolis advances, remained relatively stable when compared to balances as of March 31, 2024.

Capital

The following table presents the consolidated regulatory capital ratios of the Company for the previous three quarters:

For the Quarter Ended	June 30,		March 31,		December 31,
	2024*		2024**		2023**
Consolidated Capital Ratios
Total capital (to risk-weighted assets)	13.36	%	13.75	%	14.04	%
Tier 1 capital (to risk-weighted assets)	11.56	%	11.89	%	12.13	%
Common equity tier 1 capital (to risk-weighted assets)	10.60	%	10.89	%	11.11	%
Tier 1 capital (to average assets)	8.98	%	8.91	%	8.61	%
*Preliminary estimate - may be subject to change
**Prior periods have been revised (see disclosure below)

During the second quarter of 2024 management corrected a prior computation of the Company's total capital (to risk-weighted assets), Tier 1 capital (to risk-weighted assets), and Tier 1 capital (to average assets) ratios for purposes of the Company's consolidated financial statements for holding companies filed with the Federal Reserve (the "Regulatory Filings"), which involved an incorrect classification of the Company's subordinated notes as Tier 1 capital. The Company evaluated the effects of the incorrect classification to its previously filed Regulatory Filings and previously issued financial statements and determined the errors were not material to either of the prior periods noted above. The Company has amended its Regulatory Filings for the periods ended March 31, 2024 and December 31, 2023 to reclassify the subordinated notes balance from Tier 1 capital into Tier 2 capital. The correction of the classification had no effect on the Company's consolidated balance sheets, statements of income, stockholders' equity, or the amounts or disclosure of the regulatory capital ratios of the Bank as included in its call reports. The Company continues to exceed regulatory proxy ratios to be considered "well capitalized", plus the capital conservation buffer, at June 30, 2024. The Company will reflect the reclassification of the subordinated notes described above in its Quarterly Report on Form 10-Q for the quarter ended June 30, 2024.

As of June 30, 2024, the ratio of total stockholders' equity to total assets is 9.18%. Book value per common share was $16.62, increasing $0.13 during the second quarter of 2024.

Tangible common equity¹ totaled $559.5 million at June 30, 2024, and the ratio of tangible common equity to tangible assets¹ was 7.22% at June 30, 2024. Tangible book value, which excludes intangible assets from total equity, per common share¹ was $12.80, increasing $0.15 during the second quarter of 2024.

Credit Quality

As of June 30, 2024, total non-accrual loans decreased by $0.8 million, or 4.1%, from March 31, 2024, to 0.38% of total loans HFI. Total non-performing assets increased $0.2 million, or 0.8%, to $20.5 million, compared to $20.3 million as of March 31, 2024. The ratio of non-performing assets to total assets was unchanged compared to the first quarter of 2024.

As of June 30, 2024, net charge-offs increased by $0.2 million to $0.6 million, compared to $0.4 million as of March 31, 2024, but remain low at 0.05% annualized of average loan balances.

Earnings Conference Call

As previously announced, Horizon will host a conference call to review its second quarter financial results and operating performance.

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¹ Non-GAAP financial metric. See non-GAAP reconciliation included herein for the most directly comparable GAAP measure.

Participants may access the live conference call on July 25, 2024 at 7:30 a.m. CT (8:30 a.m. ET) by dialing 833-974-2379 from the United States, 866-450-4696 from Canada or 1-412-317-5772 from international locations and requesting the "Horizon Bancorp Call." Participants are asked to dial in approximately 10 minutes prior to the call.

A telephone replay of the call will be available approximately one hour after the end of the conference through August 2, 2024. The replay may be accessed by dialing 877-344-7529 from the United States, 855-669-9658 from Canada or 1–412–317-0088 from other international locations, and entering the access code 6800817.

About Horizon Bancorp, Inc.

Horizon Bancorp, Inc. (NASDAQ GS: HBNC) is the $7.9 billion-asset commercial bank holding company for Horizon Bank, which serve customers across diverse and economically attractive Midwestern markets through convenient digital and virtual tools, as well as its Indiana and Michigan branches. Horizon's retail offerings include prime residential and other secured consumer lending to in-market customers, as well as a range of personal banking and wealth management solutions. Horizon also provides a comprehensive array of in-market business banking and treasury management services, as well as equipment financing solutions for customers regionally and nationally, with commercial lending representing over half of total loans. More information on Horizon, headquartered in Northwest Indiana's Michigan City, is available at horizonbank.com and investor.horizonbank.com.

Use of Non-GAAP Financial Measures

Certain information set forth in this press release refers to financial measures determined by methods other than in accordance with GAAP. Specifically, we have included non-GAAP financial measures relating to net income, diluted earnings per share, pre-tax, pre-provision net income, net interest margin, tangible stockholders' equity and tangible book value per share, efficiency ratio, the return on average assets, the return on average common equity, and return on average tangible equity. In each case, we have identified special circumstances that we consider to be non-recurring and have excluded them. We believe that this shows the impact of such events as acquisition-related purchase accounting adjustments and swap termination fees, among others we have identified in our reconciliations. Horizon believes these non-GAAP financial measures are helpful to investors and provide a greater understanding of our business and financial results without giving effect to the purchase accounting impacts and one-time costs of acquisitions and non–recurring items. These measures are not necessarily comparable to similar measures that may be presented by other companies and should not be considered in isolation or as a substitute for the related GAAP measure. See the tables and other information below and contained elsewhere in this press release for reconciliations of the non-GAAP information identified herein and its most comparable GAAP measures.

Forward Looking Statements

This press release may contain forward–looking statements regarding the financial performance, business prospects, growth and operating strategies of Horizon Bancorp, Inc. and its affiliates (collectively, "Horizon"). For these statements, Horizon claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Statements in this press release should be considered in conjunction with the other information available about Horizon, including the information in the filings we make with the Securities and Exchange Commission (the "SEC"). Forward-looking statements provide current expectations or forecasts of future events and are not guarantees of future performance. The forward-looking statements are based on management's expectations and are subject to a number of risks and uncertainties. We have tried, wherever possible, to identify such statements by using words such as "anticipate," "estimate," "project," "intend," "plan," "believe," "will" and similar expressions in connection with any discussion of future operating or financial performance.

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: current financial conditions within the banking industry, including the effects of recent failures of other financial institutions, liquidity levels, and responses by the Federal Reserve, Department of the Treasury, and the Federal Deposit Insurance Corporation to address these issues; changes in the level and volatility of interest rates, changes in spreads on earning assets and changes in interest bearing liabilities; increased interest rate sensitivity; the ability of Horizon to remediate its material weaknesses in its internal control over financial reporting; continuing increases in inflation; loss of key Horizon personnel; increases in disintermediation; potential loss of fee income, including interchange fees, as new and emerging alternative payment platforms take a greater market share of the payment systems; estimates of fair value of certain of Horizon's assets and liabilities; changes in prepayment speeds, loan originations, credit losses, market values, collateral securing loans and other assets; changes in sources of liquidity; economic conditions and their impact on Horizon and its customers, including local and global economic recovery from the pandemic; legislative and regulatory actions and reforms; changes in accounting policies or procedures as may be adopted and required by regulatory agencies; litigation, regulatory enforcement, and legal compliance risk and costs; rapid technological developments and changes; cyber terrorism and data security breaches; the rising costs of cybersecurity; the ability of the U.S. federal government to manage federal debt limits; climate change and social justice initiatives; the inability to realize cost savings or revenues or to effectively implement integration plans and other consequences associated with mergers, acquisitions, and divestitures; acts of terrorism, war and global conflicts, such as the Russia and Ukraine conflict and the Israel and Hamas conflict; and supply chain disruptions and delays. These and additional factors that could cause actual results to differ materially from those expressed in the forward-looking statements are discussed in Horizon's reports (such as the Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K) filed with the SEC and available at the SEC's website (www.sec.gov). Undue reliance should not be placed on the forward–looking statements, which speak only as of the date hereof. Horizon does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions that may be made to update any forward-looking statement to reflect the events or circumstances after the date on which the forward–looking statement is made, or reflect the occurrence of unanticipated events, except to the extent required by law.


	Condensed Consolidated Statements of Income
	(Dollars in Thousands Except Per Share Data, Unaudited)
	Three Months Ended											Six Months Ended
	June 30,		March 31,		December 31,			September 30,		June 30,		June 30,		June 30,
	2024		2024		2023			2023		2023		2024		2023
Interest Income
Loans receivable	$	71,880	$	66,954	$	65,583		$	63,003	$	60,594	$	138,834	$	115,958
Investment securities - taxable		7,986		7,362		8,157			8,788		8,740		15,348		17,465
Investment securities - tax-exempt		6,377		6,451		6,767			7,002		7,059		12,828		14,615
Other		738		4,497		3,007			1,332		475		5,235		628
Total interest income		86,981		85,264		83,514			80,125		76,868		172,245		148,666
Interest Expense
Deposits		28,447		27,990		27,376			24,704		18,958		56,437		33,777
Borrowed funds		11,213		11,930		11,765			11,224		9,718		23,143		19,489
Subordinated notes		829		831		870			880		881		1,660		1,761
Junior subordinated debentures issued to capital trusts		1,213		1,225		1,246			1,227		1,151		2,438		2,241
Total interest expense		41,702		41,976		41,257			38,035		30,708		83,678		57,268
Net Interest Income		45,279		43,288		42,257			42,090		46,160		88,567		91,397
Provision for loan losses		2,369		805		1,274			263		680		3,174		922
Net Interest Income after Provision for Loan Losses		42,910		42,483		40,983			41,827		45,480		85,393		90,475
Non-interest Income
Service charges on deposit accounts		3,130		3,214		3,092			3,086		3,021		6,344		6,049
Wire transfer fees		113		101		103			120		116		214		225
Interchange fees		3,826		3,109		3,224			3,186		3,584		6,935		6,451
Fiduciary activities		1,372		1,315		1,352			1,206		1,247		2,687		2,522
Gains (losses) on sale of investment securities		—		—		(31,572	)		—		20		—		(480	)
Gain on sale of mortgage loans		896		626		951			1,582		1,005		1,522		1,790
Mortgage servicing income net of impairment		450		439		724			631		640		889		1,353
Increase in cash value of bank owned life insurance		318		298		658			1,055		1,015		616		1,996
Other income		380		827		1,019			964		349		1,207		711
Total non-interest income		10,485		9,929		(20,449	)		11,830		10,997		20,414		20,617
Non-interest Expense
Salaries and employee benefits		20,583		20,268		21,877			20,058		20,162		40,851		38,874
Net occupancy expenses		3,192		3,546		3,260			3,283		3,249		6,738		6,812
Data processing		2,579		2,464		2,942			2,999		3,016		5,043		5,685
Professional fees		714		607		772			707		633		1,321		1,166
Outside services and consultants		3,058		3,359		2,394			2,316		2,515		6,417		5,232
Loan expense		1,038		719		1,345			1,120		1,397		1,757		2,515
FDIC insurance expense		1,315		1,320		1,200			1,300		840		2,635		1,380
Core deposit intangible amortization		844		872		903			903		903		1,716		1,806
Other losses		515		16		508			188		134		531		355
Other expense		3,684		3,936		4,129			3,294		3,413		7,620		6,961
Total non-interest expense		37,522		37,107		39,330			36,168		36,262		74,629		70,786
Income /(Loss) Before Income Taxes		15,873		15,305		(18,796	)		17,489		20,215		31,178		40,306
Income tax expense		1,733		1,314		6,419			1,284		1,452		3,047		3,315
Net Income /(Loss)	$	14,140	$	13,991	$	(25,215	)	$	16,205	$	18,763	$	28,131	$	36,991
Basic Earnings /(Loss) Per Share	$	0.32	$	0.32	$	(0.58	)	$	0.37	$	0.43	$	0.64	$	0.85
Diluted Earnings/(Loss) Per Share		0.32		0.32		(0.58	)		0.37		0.43		0.64		0.85


	Condensed Consolidated Balance Sheets
	(Dollars in Thousands)
	June 30, 2024			March 31, 2024			December 31, 2023			September 30, 2023			June 30, 2023
Assets
Interest earning assets
Federal funds sold		34,453			161,704			401,672			71,576			115,794
Interest earning deposits		6,672			10,893			14,276			6,925			6,295
Federal Home Loan Bank stock		53,826			53,826			34,509			34,509			34,509
Investment securities, available for sale		527,054			535,319			547,251			865,168			905,813
Investment securities, held to maturity		1,904,281			1,925,725			1,945,638			1,966,483			1,983,496
Loans held for sale		2,440			922			1,418			2,828			6,933
Gross loans held for investment (HFI)		4,822,840			4,618,175			4,417,630			4,359,002			4,266,260
Total Interest earning assets		7,351,566			7,306,564			7,362,394			7,306,491			7,319,100
Non-interest earning assets
Allowance for credit losses		(52,215	)		(50,387	)		(50,029	)		(49,699	)		(49,976	)
Cash and due from banks		106,691			100,206			112,772			98,843			109,349
Cash value of life insurance		36,773			36,455			36,157			149,212			148,171
Other assets		165,656			160,593			177,061			152,280			133,476
Goodwill		155,211			155,211			155,211			155,211			155,211
Other intangible assets		11,910			12,754			13,626			14,530			15,433
Premises and equipment, net		93,695			94,303			94,583			94,716			95,053
Interest receivable		43,240			40,008			38,710			37,850			37,536
Total non-interest earning assets		560,961			549,143			578,091			652,943			644,253
Total assets		7,912,527			7,855,707			7,940,485			7,959,434			7,963,353
Liabilities
Savings and money market deposits		3,364,726			3,350,673			3,369,149			3,322,788			3,289,474
Time deposits		1,178,389			1,136,121			1,179,739			1,250,606			1,249,803
Borrowings		1,229,165			1,219,812			1,217,020			1,214,016			1,186,407
Repurchase agreements		128,169			139,309			136,030			142,494			165,632
Subordinated notes		55,668			55,634			55,543			59,007			58,970
Junior subordinated debentures issued to capital trusts		57,369			57,315			57,258			57,201			57,143
Total interest earning liabilities		6,013,486			5,958,864			6,014,739			6,046,112			6,007,429
Non-interest bearing deposits		1,087,040			1,093,076			1,116,005			1,126,703			1,170,055
Interest payable		11,240			7,853			22,249			16,281			12,739
Other liabilities		74,096			74,664			68,680			76,969			63,887
Total liabilities		7,185,862			7,134,457			7,221,673			7,266,065			7,254,110
Stockholders' Equity
Preferred stock		—			—			—			—			—
Common stock		—			—			—			—			—
Additional paid-in capital		357,673			356,599			356,400			355,478			354,953
Retained earnings		442,977			435,927			429,021			461,325			452,209
Accumulated other comprehensive income (loss)		(73,985	)		(71,276	)		(66,609	)		(123,434	)		(97,919	)
Total stockholders' equity		726,665			721,250			718,812			693,369			709,243
Total liabilities and stockholders' equity	$	7,912,527		$	7,855,707		$	7,940,485		$	7,959,434		$	7,963,353

	Loans and Deposits
	(Dollars in Thousands, Unaudited)
	June 30,	March 31,	December 31,	September 30,	June 30,	% Change
	2024	2024	2023	2023	2023	Q2'24 vs Q1'24		Q2'24 vs Q2'23
Commercial:
Commercial real estate	2,117,772	1,984,723	1,962,097	1,916,056	1,859,285	7	%	14	%
Commercial & Industrial	786,788	765,043	712,863	673,188	646,994	3	%	22	%
Total commercial	2,904,560	2,749,766	2,674,960	2,589,244	2,506,279	6	%	16	%
Residential Real estate	797,956	782,071	681,136	675,399	674,751	2	%	18	%
Mortgage warehouse	68,917	56,548	45,078	65,923	82,345	22	%	(16	)%
Consumer	1,051,407	1,029,790	1,016,456	1,028,436	1,002,885	2	%	5	%
Total loans held for investment	4,822,840	4,618,175	4,417,630	4,359,002	4,266,260	4	%	13	%
Loans held for sale	2,440	922	1,418	2,828	6,933	165	%	(65	)%
Total loans	4,825,280	4,619,097	4,419,048	4,361,830	4,273,193	4	%	13	%

Deposits:
Interest bearing deposits
Savings and money market deposits	3,364,726	3,350,673	3,369,149	3,322,788	3,289,474	—	%	2	%
Time deposits	1,178,389	1,136,121	1,179,739	1,250,606	1,249,803	4	%	(6	)%
Total Interest bearing deposits	4,543,115	4,486,794	4,548,888	4,573,394	4,539,277	1	%	—	%
Non-interest bearing deposits
Non-interest bearing deposits	1,087,040	1,093,076	1,116,005	1,126,703	1,170,055	(1	)%	(7	)%
Total deposits	5,630,155	5,579,870	5,664,893	5,700,097	5,709,332	1	%	(1	)%


	Average Balance Sheet
	(Dollars in Thousands, Unaudited)
	Three Months Ended
	June 30, 2024								March 31, 2024								June 30, 2023
	Average Balance			Interest⁽⁴⁾			Average Rate⁽⁴⁾		Average Balance			Interest⁽⁴⁾			Average Rate⁽⁴⁾		Average Balance			Interest⁽⁴⁾			Average Rate⁽⁴⁾
Assets
Interest earning assets
Federal funds sold	$	47,805		$	645		5.43	%	$	322,058		$	4,387		5.48	%	$	30,926		$	376		4.88	%
Interest earning deposits		7,662			93		4.88	%		9,025			110		4.90	%		9,002			99		4.41	%
Federal Home Loan Bank stock		53,827			1,521		11.36	%		37,949			784		8.31	%		33,322			508		6.11	%
Investment securities - taxable⁽¹⁾		1,309,305			6,465		1.99	%		1,326,246			6,578		1.99	%		1,673,439			8,232		1.97	%
Investment securities - non-taxable⁽¹⁾		1,132,065			8,072		2.87	%		1,149,957			8,166		2.86	%		1,240,931			8,935		2.89	%
Total investment securities		2,441,370			14,537		2.39	%		2,476,203			14,744		2.39	%		2,914,370			17,167		2.36	%
Loans receivable^{(2) (3)}		4,662,124			72,208		6.23	%		4,448,324			67,307		6.09	%		4,225,020			60,843		5.78	%
Total interest earning assets		7,212,788			89,004		4.96	%		7,293,559			87,332		4.82	%		7,212,640			78,993		4.39	%
Non-interest earning assets
Cash and due from banks		108,319								105,795								102,935
Allowance for credit losses		(50,334	)							(49,960	)							(49,481	)
Other assets		508,555								486,652								573,932
Total average assets	$	7,779,328							$	7,836,046							$	7,840,026

Liabilities and Stockholders' Equity
Interest bearing liabilities
Interest bearing deposits	$	3,334,490		$	17,405		2.10	%	$	3,323,227		$	15,889		1.92	%	$	3,329,899		$	10,388		1.25	%
Time deposits		1,134,590			11,042		3.91	%		1,176,921			12,101		4.14	%		1,115,175			8,570		3.08	%
Borrowings		1,184,172			10,187		3.46	%		1,200,728			10,904		3.65	%		1,176,702			9,035		3.08	%
Repurchase agreements		125,144			1,026		3.30	%		138,052			1,026		2.99	%		140,606			683		1.95	%
Subordinated notes		55,647			829		5.99	%		55,558			831		6.02	%		58,946			881		5.99	%
Junior subordinated debentures issued to capital trusts		57,335			1,213		8.51	%		57,279			1,225		8.60	%		57,110			1,151		8.08	%
Total interest bearing liabilities		5,891,378			41,702		2.85	%		5,951,765			41,976		2.84	%		5,878,438			30,708		2.10	%
Non-interest bearing liabilities
Demand deposits		1,080,676								1,077,183								1,186,520
Accrued interest payable and other liabilities		80,942								82,015								64,115
Stockholders' equity		726,332								725,083								710,953
Total average liabilities and stockholders' equity	$	7,779,328							$	7,836,046							$	7,840,026
Net FTE interest income (non-GAAP)⁽⁵⁾				$	47,302							$	45,356							$	48,285
Less FTE adjustments⁽⁴⁾					(2,023	)							(2,068	)							(2,125	)
Net Interest Income				$	45,279							$	43,288							$	46,160
Net FTE interest margin (Non-GAAP)⁽⁴⁾⁽⁵⁾							2.64	%							2.50	%							2.69	%
⁽¹⁾Securities balances represent daily average balances for the fair value of securities. The average rate is calculated based on the daily average balance for the amortized cost of securities.
⁽²⁾Includes fees on loans held for sale and held for investment. The inclusion of loan fees does not have a material effect on the average interest rate.
⁽³⁾Non-accruing loans for the purpose of the computation above are included in the daily average loan amounts outstanding. Loan totals are shown net of unearned income and deferred loan fees.
⁽⁴⁾Management believes fully taxable equivalent, or FTE, interest income is useful to investors in evaluating the Company's performance as a comparison of the returns between a tax-free investment and a taxable alternative. The Company adjusts interest income and average rates for tax-exempt loans and securities to an FTE basis utilizing a 21% tax rate
⁽⁵⁾Non-GAAP financial metric. See non-GAAP reconciliation included herein for the most directly comparable GAAP measure.


	Credit Quality
	(Dollars in Thousands Except Ratios, Unaudited)
	Quarter Ended
	June 30,			March 31,			December 31,			September 30,			June 30,			% Change
	2024			2024			2023			2023			2023			2Q24 vs 1Q24		2Q24 vs 2Q23
Non-accrual loans
Commercial	$	4,321		$	5,493		$	7,362		$	6,919		$	8,275		(21	)%	(48	)%
Residential Real estate		8,489			8,725			8,058			7,644			7,927		(3	)%	7	%
Mortgage warehouse		—			—			—			—			—		—	%	—	%
Consumer		5,453			4,835			4,290			4,493			4,594		13	%	19	%
Total non-accrual loans	$	18,263		$	19,053		$	19,710		$	19,056		$	20,796		(4	)%	(7	)%
90 days and greater delinquent - accruing interest	$	1,058		$	108		$	559		$	392		$	1,313		880	%	(19	)%
Total non-performing loans	$	19,321		$	19,161		$	20,269		$	19,448		$	22,109		1	%	(5	)%

Other real estate owned
Commercial	$	1,111		$	1,124		$	1,124		$	1,287		$	1,567		(1	)%	(29	)%
Residential Real estate		—			—			182			32			107		—	%	(100	)%
Mortgage warehouse		—			—			—			—			—		—	%	—	%
Consumer		57			50			205			72			7		14	%	714	%
Total other real estate owned	$	1,168		$	1,174		$	1,511		$	1,391		$	1,681		(1	)%	(31	)%

Total non-performing assets	$	20,489		$	20,335		$	21,780		$	20,839		$	23,790		1	%	(14	)%

Loan data:
Accruing 30 to 89 days past due loans		19,785			15,154			16,595			13,089			10,913		31	%	81	%
Substandard loans	$	51,221		$	47,469		$	49,526		$	47,563		$	41,484		8	%	23	%
Net charge-offs (recoveries)
Commercial		54			(57	)		233			142			101		195	%	(47	)%
Residential Real estate		(5	)		(5	)		21			(39	)		(10	)	—	%	50	%
Mortgage warehouse		—			—			—			—			—		—	%	—	%
Consumer		535			488			531			619			183		10	%	192	%
Total net charge-offs	$	584		$	426		$	785		$	722		$	274		37	%	113	%

Allowance for credit losses
Commercial		31,941			30,514			29,736			29,472			30,354		5	%	5	%
Residential Real estate		2,588			2,655			2,503			2,794			3,648		(3	)%	(29	)%
Mortgage warehouse		736			659			481			714			893		12	%	(18	)%
Consumer		16,950			16,559			17,309			16,719			15,081		2	%	12	%
Total allowance for credit losses	$	52,215		$	50,387		$	50,029		$	49,699		$	49,976		4	%	4	%

Credit quality ratios
Non-accrual loans to HFI loans		0.38	%		0.41	%		0.45	%		0.44	%		0.49	%
Non-performing assets to total assets		0.26	%		0.26	%		0.27	%		0.26	%		0.30	%
Annualized net charge-offs of average total loans		0.05	%		0.04	%		0.07	%		0.07	%		0.04	%
Allowance for credit losses to HFI loans		1.08	%		1.09	%		1.13	%		1.14	%		1.17	%


Non–GAAP Reconciliation of Net Fully-Taxable Equivalent ("FTE") Interest Margin
(Dollars in Thousands, Unaudited)
		Three Months Ended
		June 30,			March 31,			December 31,			September 30,			June 30,
		2024			2024			2023			2023			2023
Interest income (GAAP)	(A)	$	86,981		$	85,264		$	83,514		$	80,125		$	76,868
Taxable-equivalent adjustment:
Investment securities - tax exempt⁽¹⁾		$	1,695		$	1,715		$	1,799		$	1,861		$	1,876
Loan receivable⁽²⁾		$	328		$	353		$	314		$	251		$	249
Interest income (non-GAAP)	(B)	$	89,004		$	87,332		$	85,627		$	82,237		$	78,993
Interest expense (GAAP)	(C)	$	41,702		$	41,976		$	41,257		$	38,035		$	30,708
Net interest income (GAAP)	(D) = (A) - (C)	$	45,279		$	43,288		$	42,257		$	42,090		$	46,160
Net FTE interest income (non-GAAP)	(E) = (B) - (C)	$	47,302		$	45,356		$	44,370		$	44,202		$	48,285
Average interest earning assets	(F)		7,212,788			7,293,559			7,239,034			7,286,611			7,212,640
Net FTE interest margin (non-GAAP)	(G) = (E*) / (F)		2.64	%		2.50	%		2.43	%		2.41	%		2.69	%

⁽¹⁾The following represents municipal securities interest income for investment securities classified as available-for-sale and held-to-maturity
⁽²⁾The following represents municipal loan interest income for loan receivables classified as held for sale and held for investment
*Annualized


Non–GAAP Reconciliation of Return on Average Tangible Common Equity
(Dollars in Thousands, Unaudited)
		Three Months Ended
		June 30,			March 31,			December 31,			September 30,			June 30,
		2024			2024			2023			2023			2023

Net income (loss) (GAAP)	(A)	$	14,140		$	13,991		$	(25,215	)	$	16,205		$	18,763

Average stockholders' equity	(B)	$	726,332		$	725,083		$	702,793		$	715,485		$	710,953
Average intangible assets	(C)		167,659			168,519			169,401			170,301			171,177
Average tangible equity (Non-GAAP)	(D) = (B) - (C)	$	558,673		$	556,564		$	533,392		$	545,184		$	539,776
Return on average tangible common equity ("ROACE") (non-GAAP)	(E) = (A*) / (D)		10.18	%		10.11	%	(18.76)%				11.79	%		13.94	%
*Annualized


Non–GAAP Reconciliation of Tangible Common Equity to Tangible Assets
(Dollars in Thousands, Unaudited)
		Three Months Ended
		June 30,			March 31,			December 31,			September 30,			June 30,
		2024			2024			2023			2023			2023
Total stockholders' equity (GAAP)	(A)	$	726,665		$	721,250		$	718,812		$	693,369		$	709,243
Intangible assets (end of period)	(B)		167,121			167,965			168,837			169,741			170,644
Total tangible common equity (non-GAAP)	(C) = (A) - (B)	$	559,544		$	553,285		$	549,975		$	523,628		$	538,599

Total assets (GAAP)	(D)		7,912,527			7,855,707			7,940,485			7,959,434			7,963,353
Intangible assets (end of period)	(B)		167,121			167,965			168,837			169,741			170,644
Total tangible assets (non-GAAP)	(E) = (D) - (B)	$	7,745,406		$	7,687,742		$	7,771,648		$	7,789,693		$	7,792,709

Tangible common equity to tangible assets (Non-GAAP)	(G) = (C) / (E)		7.22	%		7.20	%		7.08	%		6.72	%		6.91	%


Non–GAAP Reconciliation of Tangible Book Value Per Share
(Dollars in Thousands, Unaudited)
		Three Months Ended
		June 30,		March 31,		December 31,		September 30,		June 30,
		2024		2024		2023		2023		2023
Total stockholders' equity (GAAP)	(A)	$	726,665	$	721,250	$	718,812	$	693,369	$	709,243
Intangible assets (end of period)	(B)		167,121		167,965		168,837		169,741		170,644
Total tangible common equity (non-GAAP)	(C) = (A) - (B)	$	559,544	$	553,285	$	549,975	$	523,628	$	538,599
Common shares outstanding	(D)		43,712,059		43,726,380		43,652,063		43,648,501		43,645,216

Tangible book value per common share (non-GAAP)	(E) = (C) / (D)	$	12.80	$	12.65	$	12.60	$	12.00	$	12.34

Contact:	John R. Stewart, CFA
	Chief Financial Officer
Phone:	(219) 814-5833
Fax:	(219) 874–9280
Date:	July 24, 2024

Horizon Bancorp, Inc. Reports Second Quarter 2024 Results Including EPS of $0.32, Net Interest Margin Expansion, and Growth in Net Interest Income and Loans