First Savings Financial Group to Merge with First Merchants

TL;DR

**FSFG is getting acquired by First Merchants, so expect a smooth exit for shareholders and a bigger regional player in Indiana.**

AI Summary

First Savings Financial Group, Inc. (FSFG) reported a significant strategic shift with a definitive merger agreement to be acquired by First Merchants Corporation, expected to close in Q1 2026. The company, an Indiana-chartered commercial bank, continues to transform its balance sheet from a traditional thrift to a commercial bank, emphasizing residential lending and expanding commercial banking services. A key component of its lending strategy is the NNN Finance Program, which had a portfolio balance of $765.4 million at September 30, 2025, with an average loan size of $1.7 million. FSFG held substantial FDIC-insured deposit market shares in its primary Indiana counties as of June 30, 2025, including 100.00% in Crawford County and 40.70% in Washington County. The aggregate market value of nonaffiliate common equity was $140.3 million as of March 31, 2025, with 7,015,080 shares outstanding on December 5, 2025. The company faces increasing competition from larger financial institutions and technological advances in the financial services industry.

Why It Matters

This merger is a significant event for First Savings Financial Group's investors, offering a clear exit strategy and potential premium. For employees and customers, it signals integration into a larger regional bank, First Merchants Corporation, which could mean expanded services or operational changes. The competitive landscape in South Central Indiana will shift, as First Merchants Bank will absorb FSFG's substantial deposit market share, including 100.00% in Crawford County, potentially increasing its regional dominance and challenging other community banks and credit unions. This consolidation reflects a broader trend in the financial services industry, where smaller institutions are acquired by larger ones to gain scale and market presence.

Risk Assessment

Risk Level: low — The primary risk associated with First Savings Financial Group is now the successful completion of its merger with First Merchants Corporation, which is expected to close in Q1 2026. While regulatory approvals and shareholder consent are still required, the definitive agreement significantly de-risks the investment compared to ongoing operational challenges. The company's market value of $140.3 million and 7,015,080 shares outstanding indicate a stable, established entity entering a planned acquisition.

Analyst Insight

Investors should hold FSFG shares, anticipating the merger's completion in Q1 2026, which will likely result in a cash or stock payout from First Merchants Corporation. New investors should evaluate the terms of the merger agreement to determine if there is an arbitrage opportunity, considering the current share price of $25.76 as of March 31, 2025, against the agreed-upon acquisition price.

Key Numbers

• $140.3M — Market Value of Nonaffiliate Equity (As of March 31, 2025, indicating company size prior to merger announcement.)
• 7.02M — Shares Outstanding (As of December 5, 2025, relevant for per-share merger valuation.)
• $765.4M — NNN Finance Program Portfolio (As of September 30, 2025, representing a significant portion of the loan portfolio.)
• 100.00% — FDIC-insured Deposit Market Share (In Crawford County, Indiana, as of June 30, 2025, highlighting strong local presence.)
• 40.70% — FDIC-insured Deposit Market Share (In Washington County, Indiana, as of June 30, 2025, demonstrating significant local market penetration.)
• 22.78% — FDIC-insured Deposit Market Share (In Clark County, Indiana, as of June 30, 2025, showing competitive standing.)
• Q1 2026 — Expected Merger Close (Indicates the timeline for the strategic acquisition by First Merchants Corporation.)
• $1.7M — Average NNN Loan Size (Reflects the granular nature of the NNN Finance Program's commercial real estate loans.)

Key Players & Entities

• First Savings Financial Group, Inc. (company) — Registrant and target in merger
• First Merchants Corporation (company) — Acquirer in merger agreement
• First Savings Bank (company) — Subsidiary of First Savings Financial Group
• First Merchants Bank (company) — Subsidiary of First Merchants Corporation
• NASDAQ Stock Market, LLC (regulator) — Exchange where FSFG common stock is registered
• Federal Reserve System (regulator) — Bank became a member effective December 19, 2014
• $140.3 million (dollar_amount) — Aggregate market value of non-affiliate common equity as of March 31, 2025
• $25.76 (dollar_amount) — Closing price per share on NASDAQ as of March 31, 2025
• 7,015,080 (dollar_amount) — Shares outstanding of common stock as of December 5, 2025
• $765.4 million (dollar_amount) — NNN Finance Program portfolio balance at September 30, 2025

FAQ

Risk Factors

• Interest Rate Fluctuations [high — market]: Changes in interest rates can materially impact the company's net interest income and the fair value of its investment securities. For example, rising rates can decrease the value of fixed-rate assets, while falling rates can compress net interest margins.
• Economic Conditions [high — market]: National and regional economic downturns can adversely affect the company's financial performance by increasing loan delinquencies and defaults, reducing demand for loan products, and impacting deposit flows.
• Regulatory Changes [high — regulatory]: Changes in monetary and fiscal policies from the U.S. government, Federal Reserve Board, or U.S. Treasury can impact the company's operations and profitability. Legislative and regulatory changes also pose a risk.
• Competition [medium — operational]: The company faces increasing competition from larger financial institutions and technological advances in the financial services industry, which could affect market share and profitability.
• Loan Portfolio Quality [high — financial]: The quality and composition of the loan portfolio are critical. Deterioration in loan quality or an increase in non-performing loans could lead to significant losses.
• Third-Party Service Providers [medium — operational]: Inability of third-party service providers to perform their duties could disrupt operations and negatively impact the company's business.
• Real Estate Market Values [medium — market]: Changes in real estate market values in the company's primary market area can affect the value of collateral for its loans and the overall performance of its mortgage lending business.

Industry Context

First Savings Financial Group operates in the community banking sector, characterized by increasing competition from larger financial institutions and the disruptive influence of technological advancements. The industry is also subject to evolving regulatory landscapes and shifts in consumer preferences towards digital banking solutions.

Regulatory Implications

As a financial institution, FSFG is subject to extensive regulation by federal and state authorities, including the Federal Reserve System and the FDIC. Changes in monetary policy, capital requirements, and consumer protection laws can significantly impact its operations and profitability. The pending merger also requires regulatory approval.

What Investors Should Do

1. Monitor Merger Progress
2. Analyze NNN Finance Program Performance
3. Evaluate Market Share Stability
4. Assess Competitive Landscape

Key Dates

• 2025-09-24: Definitive Merger Agreement Signed — First Savings Financial Group entered into an agreement to be acquired by First Merchants Corporation, marking a significant strategic shift.
• 2025-09-30: NNN Finance Program Portfolio Balance — The NNN Finance Program had a portfolio balance of $765.4 million, highlighting a key lending strategy.
• 2025-12-05: Shares Outstanding Date — 7,015,080 shares outstanding were reported, relevant for merger valuation calculations.
• 2025-06-30: FDIC-insured Deposit Market Share Data — Reported significant market shares in primary Indiana counties, including 100.00% in Crawford County and 40.70% in Washington County.
• 2025-03-31: Market Value of Nonaffiliate Equity — The aggregate market value of nonaffiliate common equity was $140.3 million, indicating company size.
• 2026-01-01: Expected Merger Close (Q1 2026) — The acquisition by First Merchants Corporation is anticipated to be completed in the first quarter of 2026.

Glossary

NNN Finance Program

A lending program focused on Net-Net-Net (NNN) leases, typically associated with commercial real estate where the tenant is responsible for property taxes, insurance, and maintenance. (Represents a significant portion of FSFG's loan portfolio ($765.4 million as of Sept 30, 2025) and a key part of its commercial banking expansion strategy.)

Thrift

A type of financial institution, historically focused on savings accounts and mortgage lending, often structured as a savings and loan association. (FSFG is described as transforming from a traditional thrift to a commercial bank, indicating a strategic shift in its business model.)

Bank Holding Company

A company that owns or controls one or more banks. (First Savings Financial Group, Inc. serves as the bank holding company for First Savings Bank.)

Financial Holding Company

A type of bank holding company that is permitted to engage in a broader range of financial activities, including securities underwriting and insurance, subject to certain conditions. (First Savings Financial Group elected financial holding company status, indicating a broader scope of potential financial services.)

FDIC-insured Deposit Market Share

The percentage of total deposits insured by the Federal Deposit Insurance Corporation within a specific geographic area that is held by a particular financial institution. (FSFG holds substantial market shares in its primary Indiana counties (e.g., 100% in Crawford County), demonstrating strong local presence and competitive positioning.)

Definitive Merger Agreement

A legally binding contract between two companies outlining the terms and conditions of a merger or acquisition. (The signing of this agreement with First Merchants Corporation on September 24, 2025, is a critical event, signaling the company's pending acquisition.)

Year-Over-Year Comparison

Information comparing key metrics to the previous year, such as revenue growth, margin changes, and new risks, is not available in the provided text excerpt. The excerpt focuses on the current period's business description, risk factors, and the pending merger.

Key Financial Figures

• $0.01 — b) of the Act: Common Stock, par value $0.01 per share FSFG NASDAQ Stock Market,
• $25.76 — illion, based upon the closing price of $25.76 per share as quoted on the NASDAQ Stock
• $21.2 m — -value ratios exceeding 90% amounted to $21.2 million, of which some do not have privat
• $250,000 — rtgage loans with principal balances of $250,000 or more. Borrowers must obtain hazard i
• $1.7 million — rage size of these loans originated was $1.7 million and the portfolio balance was $765.4 mi
• $765.4 million — 7 million and the portfolio balance was $765.4 million at September 30, 2025. Construction Lo
• $500,000 — relationships to an aggregate total of $500,000. 6 Table of Contents Multi-Family a

Filing Documents

• fsfg-20250930x10k.htm (10-K) — 9612KB
• fsfg-20250930xex10d3.htm (EX-10.3) — 115KB
• fsfg-20250930xex21d0.htm (EX-21.0) — 20KB
• fsfg-20250930xex23d0.htm (EX-23.0) — 2KB
• fsfg-20250930xex31d1.htm (EX-31.1) — 11KB
• fsfg-20250930xex31d2.htm (EX-31.2) — 11KB
• fsfg-20250930xex32d0.htm (EX-32.0) — 8KB
• fsfg-20250930x10k011.jpg (GRAPHIC) — 20KB
• fsfg-20250930x10k012.jpg (GRAPHIC) — 13KB
• 0001104659-25-120690.txt ( ) — 39896KB
• fsfg-20250930.xsd (EX-101.SCH) — 133KB
• fsfg-20250930_cal.xml (EX-101.CAL) — 189KB
• fsfg-20250930_def.xml (EX-101.DEF) — 558KB
• fsfg-20250930_lab.xml (EX-101.LAB) — 1075KB
• fsfg-20250930_pre.xml (EX-101.PRE) — 1028KB
• fsfg-20250930x10k_htm.xml (XML) — 11296KB

Business

Business 3 Item 1A.

Risk Factors

Risk Factors 17 Item 1B. Unresolved Staff Comments 24 Item 1C. Cybersecurity 24 Item 2.

Properties

Properties 26 Item 3.

Legal Proceedings

Legal Proceedings 27 Item 4. Mine Safety Disclosures 27 Part II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 28 Item 6. [Reserved] 29 Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 30 Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 49 Item 8.

Financial Statements and Supplementary Data

Financial Statements and Supplementary Data 49 Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure 49 Item 9A.

Controls and Procedures

Controls and Procedures 50 Item 9B. Other Information 50 Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 50 Part III Item 10. Directors, Executive Officers and Corporate Governance 51 Item 11.

Executive Compensation

Executive Compensation 54 Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 62 Item 13. Certain Relationships and Related Transactions, and Director Independence 64 Item 14. Principal Accounting Fees and Services 65 Part IV Item 15. Exhibits and Financial Statement Schedules 66 Item 16. Form 10-K Summary 67 1 Table of Contents This annual report contains forward-looking statements that are based on assumptions and may describe future plans, strategies and expectations of First Savings Financial Group, Inc. These forward-looking statements are generally identified by use of the words "believe," "expect," "intend," "anticipate," "estimate," "project" or similar expressions. First Savings Financial Group's ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on the operations of First Savings Financial Group and its subsidiary include, but are not limited to, changes in interest rates, national and regional economic conditions, legislative and regulatory changes, monetary and fiscal policies of the U.S. government, including policies of the U.S. Treasury and the Federal Reserve Board, the quality and composition of the loan or investment portfolios, demand for loan products, deposit flows, competition, demand for financial services in First Savings Financial Group's market area, changes in real estate market values in First Savings Financial Group's market area, changes in relevant accounting principles and guidelines and inability of third party service providers to perform. Additional factors that may affect our results are discussed in Item 1A to this Annual Report on Form 10-K titled "Risk Factors" below. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. Except as required by applicable law or regulation, First Saving

BUSINESS

Item 1. BUSINESS General First Savings Financial Group, Inc., an Indiana corporation, was incorporated in May 2008 and serves as the holding company for First Savings Bank (the "Bank" or "First Savings Bank"). First Savings Financial Group's principal business activity is the ownership of the outstanding common stock of First Savings Bank. First Savings Financial Group does not own or lease any property but instead uses the premises, equipment and other property of First Savings Bank with the payment of appropriate rental fees, as required by applicable law and regulations, under the terms of an expense allocation agreement. Accordingly, the information set forth in this annual report including the consolidated financial statements and related financial data contained herein, relates primarily to the Bank. First Savings Bank converted from a federally-chartered savings bank to an Indiana-chartered commercial bank and became a member the Federal Reserve System effective December 19, 2014. As a result of the Bank's charter conversion, First Savings Financial Group converted to a bank holding company and simultaneously elected financial holding company status effective December 19, 2014. First Savings Bank operates as a community-oriented financial institution offering traditional financial services to consumers and businesses in its primary market area. We attract deposits from the general public and use those funds to originate primarily residential and commercial mortgage loans. We also originate commercial business loans, residential and commercial construction loans, multi-family loans, land and land development loans, and consumer loans. We conduct our lending and deposit activities primarily with individuals and small businesses in our primary market area, except as otherwise discussed herein. Our website address is www.fsbbank.net. Information on our website is not, and should not be considered a part of, this annual report. Pending Merger On September

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View this 10-K filing on SEC EDGAR