Insider Moves at First Merchants Corp. – What the Numbers Tell Us
The most recent Form 4 filing by Chief Risk Officer Eva A. Scurlock reveals that she holds 23,290 shares of First Merchants Corp.’s common stock, which includes a block of 2,223 restricted‑stock awards. Although the transaction itself is a routine holding adjustment, it coincides with a cluster of insider activity that merits closer scrutiny.
| Date | Owner | Transaction Type | Shares | Price per Share | Security |
|---|---|---|---|---|---|
| N/A | Scurlock, Eva A. | Holding | 23,290.13 | N/A | Common Stock |
| 2016‑08‑18 | Scurlock, Eva A. | Holding | N/A | N/A | Employee Stock Option – Right to Buy |
| 2019‑02‑18 | Scurlock, Eva A. | Holding | N/A | N/A | Employee Stock Option – Right to Buy |
| 2021‑02‑15 | Scurlock, Eva A. | Holding | N/A | N/A | Employee Stock Option – Right to Buy |
In parallel, Chief Financial Officer Michele Kawiecki sold 910 shares, and Chief Executive Officer Mark Hardwick liquidated 3,857 shares on 18–22 December 2025. Both executives, however, are simultaneously accumulating phantom stock valued at $38.08 per share. Phantom stock, unlike actual equity, is a contractual right to receive cash or stock equivalents when certain performance thresholds are met; its continued accrual indicates that management’s long‑term incentives remain aligned with shareholder interests.
Market Context and Recent Price Movements
First Merchants’ current share price of $37.94 sits near the 52‑week low of $33.13 but remains comfortably below the 52‑week high of $45.62. This positional gap of $12.49 (≈ 34 %) suggests that the equity still has upside potential if earnings fundamentals remain robust. The price‑to‑earnings (P/E) ratio of 9.51 places the stock below the industry average for diversified regional banks, which hovered around 10.5 in 2024. Likewise, the price‑to‑book (P/B) ratio of 0.923 indicates that the market values the company at just under its book value—a traditional signal for value investors seeking a margin of safety.
The weekly price drift of –0.21 % and monthly drift of –3.00 % illustrate a modest decline that has been largely absorbed by the broader banking sector’s rebound after the 2023‑2024 credit‑spreading tightening cycle. In the context of the Federal Reserve’s gradual interest‑rate reductions, First Merchants’ loan‑to‑deposit ratio has improved from 73 % at the end of 2023 to 76 % as of Q4 2025, supporting the bank’s net interest margin (NIM) growth of 0.18 pp year‑over‑year.
Regulatory Landscape
The recent insider filings occur in a regulatory environment that has tightened post‑2022 banking supervision standards. The Basel III and Basel IV frameworks now demand higher leverage ratios and stricter capital adequacy ratios. First Merchants reported a tier‑1 capital ratio of 12.9 %, comfortably above the 8.5 % minimum for U.S. banks. This regulatory cushion, combined with the bank’s diversified revenue base—deposit taking, consumer lending, credit cards, and trust services—reduces systemic risk exposure and should mitigate the likelihood of a “fire sale” of shares by top executives.
Investor Implications and Tactical Outlook
Short‑term Trading The current price dip is underpinned by a modest negative drift, but the P/E and P/B ratios suggest a buying opportunity. Day traders might view the $37.94 price level as a support point, with resistance near $41.50 (the 50‑day moving average). Any earnings announcement that confirms a NIM improvement of more than 0.15 pp could trigger a breakout.
Mid‑term Allocation Professionals looking to add to a diversified bank portfolio could consider a 10‑20 % allocation to First Merchants, leveraging the bank’s stable dividend policy. The dividend yield of 2.8 %—consistent with the sector average—offers a cushion against potential equity volatility.
Long‑term Positioning The continued phantom‑stock purchases by the CFO and CEO indicate that management’s horizon extends beyond the next quarter. A long‑term investor might view this as a signal that the bank’s earnings trajectory is expected to improve, especially if the loan‑portfolio quality improves (non‑performing loans at 1.2 % versus the industry average of 1.7 %).
Risk Management Given the bank’s exposure to consumer lending, macro‑economic swings in unemployment could affect loan performance. Hedge strategies such as credit default swaps or sector‑specific ETFs could mitigate downside risk while maintaining exposure to the bank’s upside potential.
Bottom Line
The insider transactions at First Merchants Corp. illustrate a balanced approach: executives are trimming personal holdings while simultaneously locking in long‑term equity incentives through phantom stock. Market data—low P/E and P/B ratios, solid capital ratios, and improving NIM—support a narrative that the bank’s diversified services and prudent regulatory compliance position it well for sustainable growth. For investors seeking a moderately valued bank with a clear dividend policy and management confidence in the long run, the current price level offers a compelling entry point.
