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Business Combinations, Goodwill and Intangible Assets
 12 Months Ended
Dec. 31, 2025
Business Combinations, Goodwill and Intangible Assets [Abstract]  
Business Combinations, Goodwill and Intangible Assets Business Combinations, Goodwill and Intangible Assets
Business Combinations

On February 1, 2025, the Company acquired Heartland BancCorp (“Heartland”) through the merger of Heartland with and into the Company. Immediately following completion of the Heartland holding company merger, Heartland’s subsidiary bank, Heartland Bank, was merged with and into the Company’s subsidiary bank, German American Bank. Heartland, headquartered in Whitehall, Ohio, operated 20 retail banking offices located in Columbus, Ohio and Greater Cincinnati.

As of the closing of the transaction, Heartland had total assets of approximately $1.94 billion, total loans of approximately $1.58 billion, and total deposits of approximately $1.73 billion. The Company accounted for the transaction under the acquisition method of accounting, which means these financial assets and liabilities were recorded at fair value at the day of acquisition. The fair value of the common shares issued as part of the consideration paid for Heartland was based upon the closing price of the Company’s common shares on the acquisition date.

In accordance with ASC 805, the Company has expensed approximately $23,196 of direct acquisition costs and recorded $196,445 of goodwill and $40,065 of intangible assets. The goodwill of $196,445 arising from the acquisition consisted largely of synergies and the cost savings resulting from combining the operations of the companies. This goodwill will be evaluated annually for impairment and is non-deductible for tax purposes. The intangible assets are related to core deposits and are being amortized over 8 years. The following table summarizes the fair value of the total consideration transferred as a part of the Heartland acquisition as well as the fair value of identifiable assets acquired and liabilities assumed as of the effective date of the transaction.

Consideration 
Cash for Stock Options, 401K Shares and Fractional Shares$23,102 
Cash Consideration— 
Equity Instruments320,007 
 
Fair Value of Total Consideration Transferred$343,109 
Recognized Amounts of Identifiable Assets Acquired and Liabilities Assumed:
Cash$6,216 
Federal Funds Sold and Other Short-term Investments39,550 
Interest-bearing Time Deposits with Banks— 
Securities220,358 
Loans, Net1,503,378 
Stock in FHLB and Other Restricted Stock, at Cost6,992 
Premises, Furniture & Equipment39,764 
Other Real Estate— 
Intangible Assets40,065 
Company Owned Life Insurance20,660 
Accrued Interest Receivable and Other Assets39,003 
Deposits - Non-interest Bearing(436,467)
Deposits - Interest Bearing(1,294,696)
FHLB Advances and Other Borrowings(29,342)
Accrued Interest Payable and Other Liabilities(8,817)
Total Identifiable Net Assets$146,664 
Goodwill$196,445 

Under the terms of the merger agreement, each Heartland common shareholder of record at the effective time of the merger became entitled to receive 3.90 shares of common stock of the Company for each of their former shares of Heartland common stock. As a result, in connection with the closing of the merger on February 1, 2025, the Company issued 7,742,723 shares of its common stock to the former shareholders of Heartland and paid $23,102 in cash, in exchange for all of the issued and outstanding shares of common stock of Heartland and in cancellation of all options to acquire Heartland common stock outstanding as of the effective time of the merger.
This acquisition was consistent with the Company’s strategy to build a regional presence in Southern Indiana, Kentucky and Ohio. The acquisition offers the Company the opportunity to increase profitability by introducing existing products and services to the acquired customer base as well as add new customers in the expanded region.

The fair value of purchased financial assets with credit deterioration was $91,377 on the date of acquisition. The gross contractual amounts receivable relating to the purchased financial assets with credit deterioration was $112,839. The Company estimates, on the date of acquisition, that $16,503 of the contractual cash flows specific to the purchased financial assets with credit deterioration will not be collected.

The following table presents unaudited pro forma information as if the acquisition had occurred on January 1, 2024 after giving effect to certain adjustments. The unaudited pro forma information for the years ended December 31, 2025 and 2024 includes adjustments for interest income on loans and securities acquired, amortization of intangibles arising from the transaction, interest expense on deposits and borrowings acquired, and the related income tax effects. The unaudited pro forma financial information is not necessarily indicative of the results of operations that would have occurred had the transaction been effected on the assumed date.

Unaudited Pro Forma
Year Ended 12/31/2025		Unaudited Pro Forma
Year Ended 12/31/2024
Net Interest Income$332,836 $229,295 
Non-interest Income70,317 65,665 
Total Revenue403,153 294,960 
Provision for Credit Losses20,325 3,675 
Non-interest Expense212,451 156,879 
Income Before Income Taxes170,377 134,406 
Income Tax Expense34,921 27,774 
Net Income$135,456 $106,632 
Earnings Per Share and Diluted Earnings Per Share$3.61 $2.85 
For the years ended December 31, 2025 and 2024, the above pro forma financial information excludes non-recurring merger costs that totaled $6,996 on a pre-tax basis and Day 1 provision for credit losses under the CECL methodology of $16,200 on a pre-tax basis.
Goodwill
 
The changes in the carrying amount of goodwill for the periods ended December 31, 2025, 2024, and 2023, were classified as follows:
 202520242023
Beginning of Year$179,025 $180,357 $180,357 
Acquired Goodwill196,445 — — 
Divested Goodwill— (1,332)— 
Impairment— — — 
End of Year$375,470 $179,025 $180,357 

The carrying amount of goodwill totaling $375,470 and $179,025 at December 31, 2025 and 2024, respectively, is allocated to the core banking segment. For the carrying amount of goodwill at December 31, 2023 of $180,357, $179,025 was allocated to the core banking segment, and $1,332 was allocated to the insurance segment. The decrease of $1,332 in 2024 was attributable to the sale of substantially all of the assets of German American Insurance, Inc. For additional information on the sale, see Note 2.

Impairment exists when a reporting unit’s carrying value of goodwill exceeds its fair value. At December 31, 2025, the Company’s reporting units had positive equity, and the Company elected to perform a qualitative assessment to determine if it was more likely than not that the fair value of the reporting units exceeded its carrying value, including goodwill. The qualitative assessment indicated that it was more likely than not that the fair value of the reporting unit exceeded its carrying value, resulting in no impairment.
 
Acquired Intangible Assets

Acquired intangible assets were as follows as of year end:
20252024
 Gross AmountAccumulated AmortizationGross AmountAccumulated Amortization
Core Banking  
Core Deposit Intangible$73,312 $(39,991)$33,247 $(29,843)
Branch Acquisition Intangible257 (257)257 (257)
Total$73,569 $(40,248)$33,504 $(30,100)
Amortization Expense was $10,148, $2,032 and $2,840, for 2025, 2024 and 2023, respectively.

Estimated amortization expense for each of the next five years is as follows:
2026$9,234 
20277,625 
20286,107 
20294,599 
20303,177