CINCINNATI, Nov. 5 /PRNewswire-FirstCall/ --

    --  Net income of $225.2 million or $4.38 per common share for the third
        quarter of 2009
    --  First Financial, through Federal Deposit Insurance Corporation (FDIC)
        assisted acquisitions, made significant advancement in its strategic
        operating markets with the addition of 36 banking centers and over $3.8
        billion in assets from the acquisitions of the banking operations of
        Peoples Community Bank, Irwin Union Bank and Trust Company and Irwin
        Union Bank, F.S.B.
    --  Purchase accounting contributed approximately $241.0 million of capital,
        created through the recognition of a bargain purchase gain on
        acquisition
    --  Tangible book value per common share increased by 58.5%, without
        dilution to shareholders, to $10.48 from $6.61 at June 30, 2009, with a
        tangible common equity ratio of 7.48% and a total risk-based capital
        ratio of 17.46%
    --  Increased allowance for loan and lease losses to 1.94% from 1.34%,
        excluding loans covered by FDIC loss share agreements

First Financial Bancorp today reported third quarter and year-to-date results for the period ended September 30, 2009.

Claude Davis, First Financial Bancorp's president and chief executive officer, said, "We are very excited about the growth and expansion of the company, particularly the retail banking network in the greater Cincinnati market, the state of Indiana, Louisville, Kentucky and our re-entry into Michigan. The banking centers we acquired complement our existing locations and provide entry into markets where we did not have a presence.

"The financial and capital strength of the company has positioned us to be opportunistic in these difficult times, and we believe that our ability to execute these transactions is evidence of that strength. We expect the capital generated as a result of these acquisitions will support the acquired assets and also support future growth and expansion opportunities.

"First Financial associates, both existing and new, have worked relentlessly to ensure the efficient integration of these banking operations. We are grateful to all of our associates for their hard work and the professional manner in which they helped to execute these transactions. We welcome our new associates to First Financial and look forward to helping them further build their careers with a strong and growing company. We also welcome our new clients. We are very excited to forge long term relationships with them and the communities where they live and work.

"Our organic growth strategy also remains on track. Construction is nearly complete on banking centers in St. Marys, Ohio and Edgewood, Kentucky," added Mr. Davis. "Both locations are expected to open in the fourth quarter and are being built with the company's new prototype design, which we expect will further enhance access and service to our clients in those markets. First Financial clients now have the convenience of banking at 118 First Financial Bank locations and ATMs within the four state regions of Ohio, Indiana, Kentucky and Michigan."

Mr. Davis continued, "Our results this quarter were impacted by higher credit costs resulting from our expectation of loan portfolio stress, primarily within our commercial and commercial construction real estate portfolios. Credit quality and the resolution of problem loans are top priorities and we continue to work closely with clients on resolution strategies for problem credits. However, until we begin to see consistent economic growth over several quarters, including increased consumer spending and lower unemployment rates, we believe that certain credit metrics, including charge-offs and nonperforming assets, may remain at elevated levels."

EARNINGS & FINANCIAL RESULTS

Third quarter 2009 net income was $226.2 million, net income available to common shareholders was $225.2 million and earnings per diluted common share were $4.38. This compares with net income of $5.7 million and earnings per diluted common share of $0.15 for the third quarter of 2008, and net income of $1.5 million, net income available to common shareholders of $0.5 million and earnings per diluted common share of $0.01 for the second quarter of 2009.

Year-to-date 2009 net income was $233.4 million, net income available to common shareholders was $230.8 million, and earnings per diluted common share were $5.31. This compares with year-to-date 2008 net income of $20.9 million and earnings per diluted common share of $0.56.

Third quarter 2009 results, when compared with the third quarter of 2008, and the second quarter of 2009, were impacted by the following significant items:

    --  Gain related to the accounting for a Federal Deposit Insurance
        Corporation (FDIC) assisted transaction.

        --  On September 18, 2009, the company assumed the banking operations of
            Irwin Union Bank and Trust Company and Irwin Union Bank. F.S.B.
            (collectively, "Irwin"), which included 27 banking centers. The
            estimated fair value of assets acquired exceeded the estimated fair
            value of liabilities assumed, resulting in the recognition of a
            $241.0 million after-tax gain.
    --  On July 31, 2009, the company assumed the banking operations of Peoples
        Community Bank (Peoples), which included 19 banking centers. The
        estimated fair value of liabilities assumed exceeded the estimated fair
        value of assets acquired, resulting in the recognition of goodwill in
        the amount of approximately $18.7 million.
    --  On August 28, 2009, in a separate and unrelated transaction, the company
        purchased 3 banking centers located in Indiana from Irwin. Associated
        loans were acquired at par value and there was no premium paid on
        assumed liabilities.
    --  Each transaction is considered a business combination and accounted for
        under Financial Accounting Standards Board ("FASB") Codification Topic
        805: Business Combinations ("Topic 805"), FASB Codification Topic 820:
        Fair Value Measurements and FASB Codification Topic 310-30: Loans and
        Debt Securities Acquired with Deteriorated Credit Quality. All acquired
        assets and liabilities were recorded at their estimated fair market
        values as of the date of acquisition, and identifiable intangible assets
        were recorded at their estimated fair value. These estimated fair market
        values are considered preliminary, and are subject to change for up to
        one year after the acquisition date as additional information relative
        to closing date fair values becomes available.
    --  Increased credit costs, including higher provision expense and elevated
        net-charge-offs.

        --  Increased the provision expense from the second quarter of 2009 by
            $16.3 million to $26.7 million, or 280% of total net charge-offs,
            further strengthening the allowance for loan and lease losses
            (excludes covered assets) to 1.94%.
        --  Included in total net charge-offs was a $2.2 million loss on the
            sale of the entire $34.5 million shared national credit portfolio.

ACQUISITIONS

All references to acquired balances reflect the fair value unless stated otherwise.

During the third quarter of 2009, through FDIC-assisted transactions, First Financial acquired the banking operations of Peoples and Irwin. The company also acquired 3 Indiana banking centers from Irwin in a separate and unrelated transaction. The acquisitions of the Peoples and Irwin franchises significantly expands the First Financial footprint, opens new markets and strengthens the company through the generation of additional capital. Through these three transactions, the company added a total of 49 banking centers, including 39 banking centers within the company's primary markets.

In connection with the Peoples and Irwin FDIC-assisted transactions, First Financial entered into loss sharing agreements with the FDIC. Under the terms of these agreements the FDIC will reimburse First Financial for losses with respect to certain loans and other real estate owned (OREO) (collectively, "covered assets"), which now represent nearly half of First Financial's loans, beginning with the first dollar of loss. These agreements provide for loss protection on single-family, residential loans for a period of ten years and First Financial is required to share any recoveries of previously charged-off amounts for the same time period, on the same pro-rata basis with the FDIC. All other loans are provided loss protection for a period of five years and recoveries of previously charged-off loans must be shared with the FDIC for a period of eight years, again on the same pro-rata basis.

First Financial must follow specific servicing and resolution procedures, as outlined in the loss share agreements, in order to receive reimbursement from the FDIC for losses on covered assets. The company has established separate and dedicated teams of legal, finance, credit and technology staff to execute and monitor all activity related to each agreement, including the required periodic reporting to the FDIC. First Financial intends to service all covered assets with the same resolution practices and diligence as it does for the assets that are not subject to a loss share agreement.

An overview of the transactions and their respective loss share agreements are discussed below.

Peoples Community Bank

Including cash received from the FDIC, First Financial acquired $566.0 million in assets, including $336.1 million in loans and other real estate, and assumed $584.7 million in liabilities, including $520.8 million in deposits, recorded at their estimated fair market value.

Covered assets totaling $324.4 million in fair value are subject to a stated loss threshold of $190.0 million whereby the FDIC will reimburse First Financial for 80% of covered asset losses up to $190.0 million, and 95% of losses beyond $190.0 million.

First Financial holds a purchase option from the FDIC for each of Peoples bank properties and their associated contents. The company's review of the former Peoples locations is still in progress.

In late October, First Financial successfully completed the technology conversion and operational integration of Peoples. In conjunction with these efforts, two former Peoples banking centers were consolidated into First Financial locations and one First Financial banking center was consolidated into a former Peoples location. In addition, of the approximately 115 associates who were employed at Peoples on the acquisition date, 96 have accepted full-time positions at First Financial. The positions are primarily located within the banking center network.

Irwin

Including cash received from the FDIC, First Financial acquired $3.3 billion in assets, including $1.8 billion in loans, and assumed $2.9 billion in liabilities, including $2.5 billion in deposits, recorded at their estimated fair market value.

The loans were acquired under a modified transaction structure with the FDIC whereby certain non-performing loans, foreclosed real estate, acquisition, development and construction loans, and residential and commercial land loans were excluded from the acquired portfolio. The estimated fair value for loans acquired was based upon the FDIC's estimated data for excluded loans. The company anticipates the final determination of the excluded loans will be completed in the fourth quarter of 2009.

Covered assets acquired from Irwin Union Bank and Trust Company totaling $1.5 billion in fair value are subject to a stated loss threshold of $526.0 million whereby the FDIC will reimburse First Financial for 80% of covered asset losses up to $526.0 million, and 95% of losses beyond $526.0 million.

Covered assets acquired from Irwin Union Bank, F.S.B. totaling $259.4 million in fair value are subject to a stated loss threshold of $110.0 million whereby the FDIC will reimburse First Financial for 80% of covered asset losses up to $110.0 million, and 95% of losses beyond $110.0 million.

As the estimated fair value of assets acquired exceeded the estimated fair value of liabilities assumed, First Financial recognized an after-tax bargain purchase gain of $241.0 million, as required by FASB Codification Topic 805.

Integration planning is underway for the conversion of Irwin's technology and operational systems; however, a specific timeline has not yet been established for these conversions.

Irwin Banking Centers

In a separate and unrelated transaction, the company purchased 3 banking centers located in Indiana from Irwin, including $84.6 million in deposits and $41.1 million in performing loans. Assets acquired in this transaction are not subject to a loss share agreement. Loans were acquired at par value and there was no premium paid on assumed liabilities.

Strategic Decisions

Management has concluded that the markets previously operated by Irwin in the western United States do not align with the long-term strategic plans for the company. Though profitable, each of these markets will pursue an exit strategy whereby the market presidents will work with an institution of their choosing to refer existing client relationships. If a suitable financial institution is not identified, an exit date will be selected for each market and the office will close in compliance with the applicable regulatory requirements. The western offices combined had an estimated $730.1 million in loans and $494.9 million in deposits on the acquisition date, based on the seller's book value. First Financial will continue to service the loans in these markets in compliance with the terms of the FDIC Purchase and Assumption Agreements.

First Financial also acquired, as part of the Irwin transaction, a franchise finance business. This business is a specialty lender in the quick service and casual dining segments of the restaurant industry. It has been consistently profitable and is led by a seasoned management team with strong underwriting, credit management and loss mitigation experience. There are principal balances of approximately $656.9 million in franchise finance loans outstanding, all of which are covered under a loss share agreement with the FDIC.

This niche business offers First Financial the ability to diversify its earning assets and will be supported as part of the company's ongoing strategy. The overall portfolio size will be managed to a risk-appropriate level so as not to create an industry concentration.

For additional information on First Financial's comparable financial results, please refer to the discussions that follow detailing revenue and expense fluctuations.

DETAILS OF RESULTS

Unless otherwise noted, all amounts discussed in this earnings release are pre-tax except net income and per-share data which are presented after-tax. Percentage changes are not annualized unless specifically noted. In some instances, financial data may not add up due to rounding.

CREDIT QUALITY (excluding covered assets)

The following table presents First Financial's key credit quality metrics.

Table I ($ in thousands) Three Months Ended September June March December September 30, 30, 31, 31, 30, 2009 2009 2009 2008 2008 Total Nonperforming Loans $63,608 $37,790 $24,892 $18,185 $14,038 Total Nonperforming Assets $67,909 $42,956 $28,405 $22,213 $18,648 Nonperforming assets as a % of: Period-End Loans, plus OREO 2.36% 1.48% 1.04% 0.83% 0.70% Total Assets 0.94% 1.14% 0.75% 0.60% 0.53% Nonperforming Loans as a % of Total Loans 2.21% 1.31% 0.91% 0.68% 0.53% Provision for Loan & Lease Losses $26,655 $10,358 $4,259 $10,475 $3,219 Allowance for Loan & Lease Losses $55,770 $38,649 $36,437 $35,873 $30,353 Allowance for Loan & Lease Losses as a % of: Period-End Loans 1.94% 1.34% 1.33% 1.34% 1.14% Nonaccrual Loans 92.2% 102.8% 147.6% 199.5% 219.5% Nonperforming Loans 87.7% 102.3% 146.4% 197.3% 216.2% Total Net Charge-Offs $9,534 $8,146 $3,695 $4,955 $2,446 Annualized Net Charge-Offs as a % of Average Loans & Leases 1.31% 1.19% 0.55% 0.73% 0.36% Year-to-Date ------------ September September 30, 2009 30, 2008 --------- --------- Total Nonperforming Loans $63,608 $14,038 Total Nonperforming Assets $67,909 $18,648 Nonperforming Assets as a % of: Period-End Loans, plus OREO 2.36% 0.70% Total Assets 0.94% 0.53% Nonperforming Loans as a % of Total Loans 2.21% 0.53% Provision for Loan & Lease Losses $41,272 $8,935 Allowance for Loan & Lease Losses $55,770 $30,353 Allowance for Loan & Lease Losses as a % of: Period-End Loans 1.94% 1.14% Nonaccrual Loans 92.2% 219.5% Nonperforming Loans 87.7% 216.2% Total Net Charge-Offs $21,375 $7,639 Annualized Net Charge-Offs as a % of Average Loans & Leases 1.03% 0.39%

The elevated net charge-offs and higher level of nonperforming assets reflects the continued adverse impact of the prolonged economic downturn and its effect on the loan portfolio. The elevated provision expense in the quarter is due largely to the company's expectation of the risk inherent in the commercial real estate portfolio. While not necessarily credit specific for First Financial, generally the outlook for this sector has continued to deteriorate and is not likely to recover over the next 12 months, according to most industry data. Therefore, the company has increased reserves for this category. Approximately $10.2 million of the $17.1 million net increase to the allowance is due to the company's estimate of sector risk in the commercial real estate portfolio. Although there have been some signs of economic stabilization and emerging optimism, unemployment rates remain at near-record levels, consumer spending is stagnant, and operating conditions continue to be challenging for many commercial borrowers.

Net Charge-offs

The commercial and commercial real estate construction lending portfolios continued to experience elevated levels of stress during the third quarter of 2009. The quarter's increase in total net charge-offs compared with last quarter and a year ago was driven primarily by deterioration within these segments. Late in 2008 and continuing into 2009, pressure from the prolonged recession began to adversely impact clients who up until that time, had not been severely affected.

Third quarter 2009 total net charge-offs were $9.5 million, or 131 basis points of average loans and leases, compared with $8.1 million or 119 basis points of average loans and leases in the second quarter of 2009, and $2.4 million or 36 basis points of average loans and leases in the third quarter of 2008. Year-to-date 2009, total net charge-offs were $21.4 million or 103 basis points of average loans and leases, compared with $7.6 million or 39 basis points of average loans and leases year-to-date 2008.

During the third quarter of 2009, primarily due to a rebound in market values and the desire to eliminate portfolio risk from the shared national credit segment, the entire $34.5 million portfolio of shared national credits was sold, resulting in a net charge-off of $2.2 million or 30 basis points of average loans and leases. Included in this loan sale was a $1.4 million relationship, in bankruptcy, which represented approximately 20% of the loss on the portfolio sale.

Nonperforming Assets

Third quarter 2009 nonperforming loans were $63.6 million compared with $37.8 million in the second quarter of 2009 and $14.0 million in the third quarter of 2008. Both the linked-quarter and year-over-year increases were primarily attributable to continued deterioration within the commercial lending portfolios, specifically, commercial real estate construction. During the quarter, the company placed a single relationship totaling $13.6 million of commercial land development loans on nonaccrual.

Similar to the past several quarters, the higher level of nonperforming loans, which are accounted for under FASB Codification Topic 310-10-35: Subsequent Measurement of Receivables, continues to adversely impact the company's nonperforming loan coverage ratios. The third quarter 2009 allowance for loan and lease losses as a percent of nonaccrual loans was 92.2% compared with 102.8% in the second quarter of 2009, and 219.5% in the third quarter of 2008, and the allowance for loan and lease losses as a percent of nonperforming loans was 87.7% compared with 102.3% in the second quarter of 2009, and 216.2% in the third quarter of 2008.

Restructured Loans

During the third quarter of 2009, the company restructured approximately $2.9 million of residential mortgage loans for borrowers. The terms of the modifications included a combination of temporary interest rate reductions, term extensions and re-amortizations. These actions did not have a significant financial impact on the company. There can be no assurance these actions will be successful in improving the long-term performance of the borrowers.

Delinquent Loans

Total loans 30 to 89 days past due at September 30, 2009 were $20.8 million, or 0.72% of period end loans, compared with $20.5 million, or 0.71% at June 30, 2009, and $22.3 million, or 0.84% at September 30, 2008. Management closely monitors these trends and ratios and considers the level of delinquent loans consistent with its expectation of the total loan portfolio's behavior.

Allowance for Loan & Lease Losses

At September 30, 2009, the allowance for loan and lease losses increased to $55.8 million from $38.6 million at June 30, 2009, and $30.4 million at September 30, 2008. The higher reserve reflects the company's expectation that certain credit metrics may remain volatile and at these historically higher levels over the next several quarters as a result of the current economic conditions, including the high unemployment rates, declining real estate values and expectations for a slow recovery.

Other Real Estate Owned

At September 30, 2009, OREO was $4.3 million, compared with $5.2 million at June 30, 2009, and $4.6 million at September 30, 2008.

For further details on the quarter-over-quarter and year-to-date changes in credit quality, excluding covered assets, please see the attached Credit Quality schedule.

CAPITAL MANAGEMENT

The Irwin FDIC-assisted transaction, which was accounted for as a business combination with a bargain purchase gain, generated approximately $241.0 million of additional capital. The acquired covered assets and the FDIC Indemnification Asset, which represents the fair value of estimated future payments by the FDIC to First Financial, are both risk-weighted at 20% for regulatory capital requirement purposes.

Associated with the sale of the company's perpetual preferred securities to the U.S. Treasury under its Capital Purchase Plan (CPP) in December of 2008, the U.S. Treasury received one warrant to purchase 930,233 shares of First Financial common stock at an exercise price of $12.90 per share. As a result of the common equity raised during the second quarter of 2009, the number of common shares eligible for purchase under the warrant agreement was reduced by 50% to 465,116 shares.

At September 30, 2009, total regulatory capital exceeded the "minimum" requirement by $380.5 million, on a consolidated basis.

The following table presents regulatory capital ratios at September 30, 2009.

Regulatory Table II "well- -capitalized" FFBC minimum ------------------------------------------------------------------ Leverage Ratio 14.60% 5% Tier 1 Capital Ratio 16.21% 6% Total Risk-Based Capital Ratio 17.46% 10% EOP Tangible Equity / EOP Tangible Assets 8.57% N/A EOP Tangible Common Equity / EOP Tangible Assets 7.48% N/A N/A = not applicable

NET INTEREST INCOME & NET INTEREST MARGIN Table III ($ in thousands) Quarter Year-to-Date September 30, September 30, 3Q-09 2Q-09 3Q-08 2009 2008 Net Interest Income $37,455 $31,209 $29,410 $99,592 $86,073 Net Interest Margin 3.59% 3.60% 3.68% 3.59% 3.72% Net Interest Margin (fully tax Equivalent) 3.61% 3.64% 3.73% 3.63% 3.79%

Third quarter 2009 net interest income increased $8.0 million from the third quarter of 2008 and $6.2 million from the second quarter of 2009. The third quarter 2009 net interest margin declined 9 basis points from the third quarter of 2008 and 1 basis point from the second quarter of 2009. Year-to-date 2009 net interest income increased $13.5 million from 2008's comparable period, and the net interest margin declined 13 basis points.

The year-over-year quarter, linked quarter and year-to-date increases in net interest income were due to higher average loan balances largely driven by the purchase of $145.1 million in performing loans from Irwin at the end of the second quarter of 2009 and the Peoples and Irwin FDIC-assisted transactions in the third quarter. This increase was partially offset by the sales of securities at the end of the second quarter and the cash flows from the investment portfolio that were not reinvested into securities.

The year-over-year quarter, linked quarter and year-to-date net interest margin declines were primarily related to the impact from the cash received from the FDIC-assisted transactions in the third quarter. These funds, held at the Federal Reserve, earn a federal funds rate and are being utilized to fund anticipated runoff from deposit repricing. This impacted the net interest margin by 11 basis points in the third quarter of 2009. The year-to-date net interest margin declines were also impacted by the lower overall market interest rate environment. The net interest margin, however, continues to benefit from the growth in average total loans and the continued mix shifts in the loan portfolio from consumer to commercial and in the deposit portfolio from time to transaction deposits.

For further details on the quarter-over-quarter and year-to-date changes in the net interest margin, please see the attached Net Interest Margin Rate / Volume Analysis.

NONINTEREST INCOME The following table presents a summary of items impacting noninterest income. Table IV ($ in thousands) Quarter Year-to-Date September 30, September 30, 3Q-09 2Q-09 3Q-08 2009 2008 Gain (Loss) on FHLMC shares $154 $112 $(3,400) $277 $(3,601) Gain on Acquisition 383,330 - - 383,330 - Gain on Sale of property & Casualty Portion of insurance Business - - - 574 - Gain on Sales of investment Securities (CPP 2Q-09; VISA 1Q-08) - 3,349 - 3,349 1,585 Impact to Noninterest Income $383,484 $3,461 $(3,400) $387,530 $(2,016)

Third quarter 2009 noninterest income was $394.9 million, an increase of $384.4 million from the third quarter of 2008, and an increase of $380.8 million from the second quarter of 2009. Excluding the items disclosed in the table, third quarter 2009 noninterest income declined $2.5 million from the third quarter of 2008 and increased $0.8 million from the second quarter of 2009. The year-over-year decline was primarily a result of lower net gains from loan sales, trust and wealth management fees and other noninterest income. The decline in other noninterest income was related to lower revenue from bank-owned life insurance and the sale of the company's property and casualty liability portion of the insurance business that was sold in the first quarter of 2009. Market-based revenues such as bank-owned life insurance and trust fees are reflective of the overall market conditions from which these revenues are derived. The linked quarter benefited from increases in service charges on deposit accounts and trust and wealth management fees, but was also negatively impacted by lower net gains from loan sales.

Year-to-date 2009 noninterest income was $421.0 million, an increase of $381.9 million from $39.1 million in 2008's comparable period. Excluding the items disclosed in the table, year-to-date 2009 noninterest income declined $7.6 million from 2008's comparable period. This decline was primarily due to lower service charges on deposit accounts, decreases in bankcard income and lower trust and wealth management fees as well as declines in income from bank-owned life insurance and brokerage income.

Over the past year, most fee income components of noninterest income have been negatively impacted by the declining economic conditions and their impact on consumer spending, while trust and wealth management fees were negatively impacted by volatility in the investment and equity markets. In the second and third quarters of 2009, a number of deposit and consumer-based fee income categories began to show improvement over prior quarters. Third quarter 2009 total service charges on deposit accounts increased $1.1 million from the second quarter of 2009 reflecting higher fee income on the company's legacy deposit accounts as well as additional income resulting from acquired deposit accounts during the quarter. Bankcard income declined slightly from the second quarter of 2009 but showed improvement from the first quarter of 2009.

The following table presents overdraft/non-sufficient funds fees and trust and wealth management fees.

Table V ($ in thousands) Quarter Year-to-Date September 30, September 30, 3Q-09 2Q-09 3Q-08 2009 2008 Overdraft/Non-Sufficient Fund Fees $3,735 $3,003 $3,789 $9,529 $10,757 Other 1,673 1,286 1,559 4,247 4,149 Total Service Charges on Deposit Accounts $5,408 $4,289 $5,348 $13,776 $14,906 Trust Fees 3,132 2,944 3,811 9,022 11,691 Investment Advisory Fees 207 309 579 859 1,975 Total Trust & Wealth Management Fees $3,339 $3,253 $4,390 $9,881 $13,666

Between June 30, 2008 and March 31, 2009, assets under management by the company's wealth management division declined by over $470 million from $2.0 billion to $1.6 billion, primarily as a result of equity market declines. A rebound in the equity markets over the past several months have positively impacted market values, and assets under management increased by over $230 million to $1.8 billion at September 30, 2009 from $1.6 billon at March 31, 2009.

NONINTEREST EXPENSE

Core operating expenses were primarily unchanged although there were some higher expenses related to general growth, market expansion and incentive compensation. Acquisition-related costs were primarily comprised of legal, professional, technology and other integration costs. Staffing and occupancy expenses also increased as a result of the additional associates and banking centers that were added during the quarter.

INCOME TAXES

Income tax expense was $133.7 million and the effective tax rate was 37.1% for the third quarter of 2009, compared with income tax expense of $2.6 million and an effective tax rate of 31.2% for the third quarter of 2008, and income tax expense of $0.7 million and an effective tax rate of 32.6% for the second quarter of 2009. Year-to-date 2009 income tax expense was $137.4 million with an effective tax rate of 37.1% compared with income tax expense of $10.0 million and an effective tax rate of 32.5% for 2008's comparable period. The increase in the overall tax rate for both the third quarter and year-to-date 2009 was driven by the tax impact from the bargain purchase gain and other changes resulting from the Irwin acquisition.

LOANS (excluding covered loans)

Third Quarter 2009 versus Third Quarter 2008

    --  Average total loans increased $179.1 million or 6.6%.
    --  Average commercial, commercial real estate and construction loans
        increased $311.7 million, or 17.2%.

Third Quarter 2009 versus Second Quarter 2009

    --  Average total loans increased $148.5 million, or 21.7% on an annualized
        basis.
    --  Average commercial, commercial real estate and construction loans
        increased $150.1 million, or 30.5% on an annualized basis.

Year-to-Date 2009 versus Year-to-Date 2008

    --  Average total loans increased $130.6 million, or 4.9%.
    --  Average commercial, commercial real estate and construction loans
        increased $275.6 million, or 15.9%.

Loan balances include $41.1 million in loans purchased on August 28, 2009 from Irwin, but exclude covered loans acquired under loss share agreements.

INVESTMENTS

Securities available-for-sale at September 30, 2009, totaled $523.4 million, compared with $492.6 million at September 30, 2008, and $528.2 million at June 30, 2009. The total investment portfolio represented 8.7% and 15.2% of total assets at September 30, 2009 and 2008, respectively, and 14.8% of total assets at June 30, 2009.

At September 30, 2009, the company held 71.8% of its available-for-sale securities in residential mortgage-related investments, substantially all of which are held in highly-rated, agency-backed pass-through instruments, including collateralized mortgage obligations (CMOs). All CMOs held by the company are AAA rated by Standard & Poor's Corporation or similar rating agencies. First Financial does not own any interest-only, principal-only, or other high-risk securities.

The company has recorded, as a component of equity in accumulated other comprehensive income, an unrealized after-tax gain on the investment portfolio of approximately $12.5 million at September 30, 2009, compared with an unrealized after-tax gain of $0.5 million at September 30, 2008, and an unrealized after-tax gain of $7.5 million at June 30, 2009.

The following table presents a summary of the total investment portfolio at September 30, 2009.

Table VI ($ in thousands, excluding book price and market value) % of Book Book Book Total Value Yield Price UST Notes & Agencies 8.7% $54,502 4.65 99.76 CMOs (Agency) 9.9% 62,342 4.62 100.47 CMOs (Private) 0.0% 68 1.12 100.00 MBSs (Agency) 61.8% 389,469 4.64 100.94 Agency Preferred 0.1% 338 - 1.69 Subtotal 80.5% $506,719 4.64 100.69 Municipal 4.1% $25,512 7.15 99.01 Other * 15.4% 97,083 3.70 101.50 Subtotal 19.5% $122,595 4.42 100.98 Total Investment Portfolio 100.0% $629,314 4.60 100.75 September 30, 2009 Pre-Tax Market Value Gain/(Loss) UST Notes & Agencies 101.92 $1,160 CMOs (Agency) 104.30 2,294 CMOs (Private) 97.97 (1) MBSs (Agency) 104.92 14,753 Agency Preferred 1.69 - Subtotal 103.46 $18,206 Municipal 101.43 $616 Other * 101.91 388 Subtotal 101.81 $1,004 Total Investment Portfolio 103.17 $19,210 Net Unrealized Gain/(Loss) $19,210 Aggregate Gains $19,488 Aggregate Losses $(278) Net Unrealized Gain/(Loss) % of Book Value 3.05% *Other includes $88 million of regulatory stock

First Financial has not purchased any securities in the investment portfolio since the first quarter of 2009 due to higher pricing on bonds, which has persisted since the beginning of the year. The increase in portfolio balances during the third quarter of 2009 was the result of acquired securities from the Peoples and Irwin transactions. All securities acquired through these FDIC-assisted transactions are conforming investments as outlined in First Financial's investment policy.

The acquired Peoples and Irwin investment securities, excluding regulatory stock, were acquired from the FDIC at their fair market values as of the date of the acquisitions.

The following table presents the quarterly progression of the investment portfolio incorporating these acquisitions.

Table VII Change ($ in thousands) 06/30/09 ------------------------------- 09/30/09 Beginning Maturities/ Ending Book Value Peoples Irwin Additions Book Value UST Notes & Agencies $41,145 $- $13,609 $(252) $54,502 CMOs (Agency) 65,879 - - (3,537) 62,342 CMOs (Private) 77 - - (9) 68 MBSs (Agency) 391,667 21,465 1,330 (24,994) 389,468 Agency Preferred 184 - - 154 338 Subtotal $498,952 $21,465 $14,939 $(28,638) $506,718 Municipals $30,085 $349 $627 $(5,549) $25,512 Other * 31,839 15,867 50,021 (643) 97,084 Subtotal $61,924 $16,216 $50,648 $(6,192) $122,596 Total Investment Portfolio $560,876 $37,681 $65,587 $(34,830) $629,314 * Includes Regulatory Stock Net Unrealized Gain/(Loss) $12,108 $19,210 Aggregate Gains $13,072 $19,488 Aggregate Losses $(964) $(278) Net Unrealized Gain/ (Loss) % of Book Value 2.16% 3.05%

DEPOSITS & FUNDING

Deposits balances were elevated by the $3.0 billion in deposits assumed as part of the Peoples and Irwin transactions, and by $84.6 million in deposits assumed on August 28, 2009 directly from Irwin.

The table below presents the progression of deposits, including the deposits acquired, during the third quarter of 2009.

Table VIII Deposits, including Acquired Deposits ($ in thousands) First First Financial Financial at Acquired Organic at 06/30/09 Deposits Growth 09/30/09 End of Period Transaction & Savings Deposits $1,680,446 $1,401,965 $50,181 $3,132,592 Time Deposits 1,032,890 950,945 44,677 2,028,512 Broker Deposits 78,509 601,332 (4,961) 674,880 Total $2,791,845 $2,954,242 $89,897 $5,835,984

As permitted by the FDIC, First Financial had the option to reprice the acquired deposit portfolios to current market rates within seven days of the acquisition dates. In addition, depositors had the option to withdraw funds without penalty. The company chose to reprice approximately $1.0 billion in deposits. The repriced deposits were comprised of all assumed brokered deposits, all time deposits from Peoples, as well as related time deposits of Irwin Union Bank, F.S.B. First Financial received approximately $948.3 million from the FDIC associated with the transactions and believes that this provides sufficient liquidity to fund the potential at-risk deposit outflows. Through the end of October, 2009, approximately 36% of the repriced deposit accounts were redeemed without penalty.

First Financial assumed additional Federal Home Loan Bank debt in the Peoples and Irwin acquisitions. Approximately $83.7 million in short-term advances from Irwin matured prior to the end of the third quarter of 2009.

The table below presents the quarterly progression of First Financial's borrowed funds position.

Table IX ($ in thousands) Change -------------------------------- 06/30/09 07/31/09 09/18/09 3Q-09 09/30/09 Beginning Peoples Irwin Maturities/ Ending Borrowed Funds Balance Additions Additions Additions Balance Short Term Borrowings: Federal Funds Purchased and Securities Sold Under Agreements to Repurchase 206,777 - - (171,014) 35,763 Federal Home Loan Bank Advances 125,000 - 138,700 (198,700) 65,000 Other 25,000 - - (25,000) - Total Short Term Borrowings $356,777 $- $138,700 $(394,714) $100,763 Long Term Borrowings: Federal Home Loan Bank Advances $70,908 $63,477 $216,304 $(5,334) 345,356 Securities Sold Under Agreements to Repurchase 65,000 - - - 65,000 Other 20,620 - - - 20,620 Total Long Term Borrowings $156,528 $63,477 $216,304 $(5,334) $430,976 Total Short & Long Term Borrowings $513,305 $63,477 $355,004 $(400,048) $531,739

At September 30, 2009, First Financial had unused and available overnight wholesale funding of approximately $2.5 billion.

Conference Call & Webcast

As previously announced, a conference call and webcast to discuss First Financial's third quarter 2009 financial results will be held on Friday, November 6, 2009, at 9:00 a.m. ET with Claude E. Davis, president and chief executive officer, and J. Franklin Hall, executive vice president and chief financial officer. To access the conference call, dial 800-860-2442 (passcode not required). The webcast will be available at First Financial's website (www.bankatfirst.com/Investor). Participants should join the live conference call and webcast 5 to 10 minutes before its scheduled start. A replay of the call and webcast will be available approximately one hour after the live call has ended. To access the replay, dial 877-344-7529 (passcode 435439).

Forward-Looking Statements

This news release should be read in conjunction with the consolidated financial statements, notes and tables in First Financial Bancorp's most recent Annual Report on Form 10-K for the year ended December 31, 2008. Management's analysis contains forward-looking statements that are provided to assist in the understanding of anticipated future financial performance. However, such performance involves risk and uncertainties that may cause actual results to differ materially. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to, management's ability to effectively execute its business plan; the risk that the strength of the United States economy in general and the strength of the local economies in which First Financial conducts operations continue to deteriorate, resulting in, among other things, a further deterioration in credit quality or a reduced demand for credit, including the resultant effect on First Financial's loan portfolio, allowance for loan and lease losses and overall financial purpose; the ability of financial institutions to access sources of liquidity at a reasonable cost; the impact of recent upheaval in the financial markets and the effectiveness of domestic and international governmental actions taken in response, such as the U.S. Treasury's TARP and the FDIC's Temporary Liquidity Guarantee Program, and the effect of such governmental actions on First Financial, its competitors and counterparties, financial markets generally and availability of credit specifically, and the U.S. and international economies, including potentially higher FDIC premiums arising from participation in the Temporary Liquidity Guarantee Program or from increased payments from FDIC insurance funds as a result of depository institution failures; the effects of and changes in policies and laws of regulatory agencies, inflation, and interest rates; technology changes; mergers and acquisitions, including costs or difficulties related to the integration of acquired companies; expected cost savings in connection with the consolidation of recent acquisitions may not be fully realized or realized within the expected time frames; and deposit attrition, customer loss and for revenue loss following completed acquisitions may be greater than expected; the effect of changes in accounting policies and practices; adverse changes in the securities and debt markets; First Financial's success in recruiting and retaining the necessary personnel to support business growth and expansion and maintain sufficient expertise to support increasingly complex products and services; the cost and effects of litigation and of unexpected or adverse outcomes in such litigation; uncertainties arising from First Financial's participation in the TARP, including impacts on employee recruitment and retention and other business practices, and uncertainties concerning the potential redemption of the U.S. Treasury's preferred stock investment under the program, including the timing of, regulatory approvals for, and conditions placed upon, any such redemption; and First Financial's success at managing the risks involved in the foregoing. For further discussion of certain factors that may cause such forward-looking statements to differ materially from actual results, refer to the 2008 Form 10-K and other public documents filed with the Securities and Exchange Commission (SEC), as well as the most recent Form 10-Q filing for the quarter ended June 30, 2009. These documents are available at no cost within the investor relations section of First Financial's website at www.bankatfirst.com/Investor and on the SEC's website at www.sec.gov. Additional information will also be set forth in our quarterly report on Form 10-Q for the quarter ended September 30, 2009, which is due to be filed with the SEC no later than November 9, 2009.

About First Financial Bancorp

First Financial Bancorp is a Cincinnati, Ohio based bank holding company. At September 30, 2009, the company had $7.3 billion in assets, including $4.9 billion in total loans and $5.8 billion in deposits. Its banking subsidiary, First Financial Bank, N.A., founded in 1863, provides consumer and commercial banking products and services, and investment and insurance products through its retail banking center network. Currently First Financial Bank, N.A. operates 128 banking centers. Its strategic operating markets are located within the four state regions of Ohio, Indiana, Kentucky and Michigan where it operates 118 banking centers. The bank's wealth management division, First Financial Wealth Resource Group, provides investment management, traditional trust, brokerage, private banking, and insurance services, and had approximately $2.0 billion in assets under management at September 30, 2009. Additional information about the company, including its products, services, and banking locations, is available at www.bankatfirst.com/investor.

FIRST FINANCIAL BANCORP. CONSOLIDATED FINANCIAL HIGHLIGHTS (Dollars in thousands, except per share) (Unaudited) Three months ended, Sep. 30, Jun. 30, Mar. 31, Dec. 31, 2009 2009 2009 2008 ---- ---- ---- ---- RESULTS OF OPERATIONS Net interest income $37,455 $31,209 $30,928 $30,129 Net income $226,187 $1,450 $5,735 $2,084 Net income available to common shareholders $225,187 $450 $5,157 $2,084 Net earnings per common share - basic $4.41 $0.01 $0.14 $0.06 Net earnings per common share - diluted $4.38 $0.01 $0.14 $0.06 Dividends declared per common share $0.10 $0.10 $0.10 $0.17 KEY FINANCIAL RATIOS Return on average assets 19.96% 0.15% 0.62% 0.23% Return on average shareholders' equity 195.16% 1.53% 6.63% 2.89% Return on average common shareholders' equity 234.13% 0.60% 7.67% 2.97% Return on average tangible common shareholders' equity 272.75% 0.66% 8.57% 3.32% Net interest margin 3.59% 3.60% 3.61% 3.67% Net interest margin (fully tax equivalent) (1) 3.61% 3.64% 3.65% 3.71% Ending equity as a percent of ending assets 9.25% 11.81% 9.29% 9.42% Ending common equity as a percent of ending assets 8.17% 9.74% 7.24% 7.31% Ending tangible common equity as a percent of: Ending tangible assets 7.48% 9.06% 6.54% 6.57% Risk-weighted assets 13.41% 11.05% 8.38% 8.37% Average equity as a percent of average assets 10.23% 10.04% 9.29% 8.04% Average common equity as a percent of average assets 8.49% 7.98% 7.22% 7.82% Average tangible common equity as a percent of average tangible assets 7.37% 7.27% 6.51% 7.05% Book value per common share $11.53 $7.16 $7.36 $7.21 Tangible book value per common share $10.48 $6.61 $6.59 $6.43 Tier 1 Ratio (2) 16.21% 14.77% 12.16% 12.38% Total Capital Ratio (2) 17.46% 16.02% 13.39% 13.62% Leverage Ratio (2) 14.60% 12.02% 9.51% 10.00% AVERAGE BALANCE SHEET ITEMS Loans (3) $2,889,234 $2,744,063 $2,717,097 $2,690,895 Covered loans and FDIC indemnification asset 540,742 0 0 0 Investment securities 578,243 731,119 758,257 574,893 Other earning assets 136,210 8,614 7,291 1,737 ------- ----- ----- ----- Total earning assets $4,144,429 $3,483,796 $3,482,645 $3,267,525 Total assets $4,496,327 $3,784,458 $3,777,510 $3,566,051 Noninterest- bearing deposits $543,320 $425,330 $416,206 $412,644 Interest-bearing deposits 3,065,377 2,408,054 2,405,700 2,367,121 --------- --------- --------- --------- Total deposits $3,608,697 $2,833,384 $2,821,906 $2,779,765 Borrowings $377,406 $542,578 $566,808 $474,655 Shareholders' equity $459,809 $379,944 $350,857 $286,582 CREDIT QUALITY RATIOS (excluding covered assets) Allowance to ending loans 1.94% 1.34% 1.33% 1.34% Allowance to nonaccrual loans 92.17% 102.81% 147.57% 199.51% Allowance to nonperforming loans 87.68% 102.27% 146.38% 197.27% Nonperforming loans to total loans 2.21% 1.31% 0.91% 0.68% Nonperforming assets to ending loans, plus OREO 2.36% 1.48% 1.04% 0.83% Nonperforming assets to total assets 0.94% 1.14% 0.75% 0.60% Net charge-offs to average loans (annualized) 1.31% 1.19% 0.55% 0.73% Three months ended, Nine months ended Sep. 30, Sep. 30, 2008 2009 2008 ---- ---- ---- RESULTS OF OPERATIONS Net interest income $29,410 $99,592 $86,073 Net income $5,732 $233,372 $20,878 Net income available to common shareholders $5,732 $230,794 $20,878 Net earnings per common share - basic $0.15 $5.37 $0.56 Net earnings per common share - diluted $0.15 $5.31 $0.56 Dividends declared per common share $0.17 $0.30 $0.51 KEY FINANCIAL RATIOS Return on average assets 0.66% 7.76% 0.83% Return on average shareholders' equity 8.24% 78.54% 10.05% Return on average common shareholders' equity 8.24% 96.69% 10.05% Return on average tangible common shareholders' equity 9.21% 116.40% 11.23% Net interest margin 3.68% 3.59% 3.72% Net interest margin (fully tax equivalent)(1) 3.73% 3.63% 3.79% Ending equity as a percent of ending assets 7.89% 9.25% 7.89% Ending common equity as a percent of ending assets 7.89% 8.17% 7.89% Ending tangible common equity as a percent of: Ending tangible assets 7.13% 7.48% 7.13% Risk-weighted assets 8.86% 13.41% 8.86% Average equity as a percent of average assets 7.96% 9.88% 8.21% Average common equity as a percent of average assets 7.96% 7.93% 8.21% Average tangible common equity as a percent of average tangible assets 7.18% 6.68% 7.41% Book value per common share $7.40 $11.53 $7.40 Tangible book value per common share $6.62 $10.48 $6.62 Tier 1 Ratio (2) 9.80% 16.21% 9.80% Total Capital Ratio (2) 10.89% 17.46% 10.89% Leverage Ratio (2) 7.95% 14.60% 7.95% AVERAGE BALANCE SHEET ITEMS Loans (3) $2,709,629 $2,784,095 $2,651,692 Covered loans and FDIC indemnification asset 0 184,824 0 Investment securities 467,524 688,547 411,967 Other earning assets 3,137 51,177 24,266 ----- ------ ------ Total earning assets $3,180,290 $3,708,643 $3,087,925 Total assets $3,476,648 $4,022,064 $3,379,343 Noninterest-bearing deposits $402,604 $462,084 $392,104 Interest-bearing deposits 2,380,037 2,628,793 2,411,221 --------- --------- --------- Total deposits $2,782,641 $3,090,877 $2,803,325 Borrowings $394,708 $494,903 $270,128 Shareholders' equity $276,594 $397,269 $277,401 CREDIT QUALITY RATIOS (excluding covered assets) Allowance to ending loans 1.14% 1.94% 1.14% Allowance to nonaccrual loans 219.47% 92.17% 219.47% Allowance to nonperforming loans 216.22% 87.68% 216.22% Nonperforming loans to total loans 0.53% 2.21% 0.53% Nonperforming assets to ending loans, plus OREO 0.70% 2.36% 0.70% Nonperforming assets to total assets 0.53% 0.94% 0.53% Net charge-offs to average loans (annualized) 0.36% 1.03% 0.39% (1) The tax equivalent adjustment to net interest income recognizes the income tax savings when comparing taxable and tax-exempt assets and assumes a 35% tax rate. Management believes that it is a standard practice in the banking industry to present net interest margin and net interest income on a fully tax equivalent basis. Therefore, management believes, these measures provide useful information to investors by allowing them to make peer comparisons. Management also uses these measures to make peer comparisons. (2) September 30, 2009 regulatory capital ratios are preliminary. (3) Includes loans held for sale. FIRST FINANCIAL BANCORP. CONSOLIDATED STATEMENTS OF INCOME (Dollars in thousands) (Unaudited) Three months ended, Sep. 30, -------- 2009 2008 % Change ---- ---- -------- Interest income Loans, including fees $44,913 $39,754 13.0% Investment securities Taxable 6,241 5,349 16.7% Tax-exempt 352 631 (44.2%) --- --- ----- Total investment securities interest 6,593 5,980 10.3% Federal funds sold 0 22 (100.0%) - -- ------ Total interest income 51,506 45,756 12.6% Interest expense Deposits 11,490 13,608 (15.6%) Short-term borrowings 261 1,720 (84.8%) Long-term borrowings 1,977 707 179.6% Subordinated debentures and capital securities 323 311 3.9% --- --- --- Total interest expense 14,051 16,346 (14.0%) ------ ------ ----- Net interest income 37,455 29,410 27.4% Provision for loan and lease losses 26,655 3,219 728.1% ------ ----- ----- Net interest income after provision for loan and lease losses 10,800 26,191 (58.8%) Noninterest income Service charges on deposit accounts 5,408 5,348 1.1% Trust and wealth management fees 3,339 4,390 (23.9%) Bankcard income 1,379 1,405 (1.9%) Net gains from sales of loans 63 376 (83.2%) Gains on sales of investment securities 0 0 N/M Gain on acquisition 383,330 0 N/M Income (loss) on preferred securities 154 (3,400) (104.5%) Other 1,213 2,359 (48.6%) ----- ----- ----- Total noninterest income 394,886 10,478 3668.7% Noninterest expenses Salaries and employee benefits 22,051 16,879 30.6% Net occupancy 3,442 2,538 35.6% Furniture and equipment 1,874 1,690 10.9% Data processing 973 791 23.0% Marketing 871 622 40.0% Communication 737 601 22.6% Professional services 1,220 729 67.4% State intangible tax 628 697 (9.9%) FDIC expense 1,612 115 1301.7% Other 12,409 3,678 237.4% ------ ----- ----- Total noninterest expenses 45,817 28,340 61.7% ------ ------ ---- Income before income taxes 359,869 8,329 4220.7% Income tax expense 133,682 2,597 5047.6% ------- ----- ------ Net income 226,187 5,732 3846.0% Dividends on preferred stock 1,000 0 N/M ----- - --- Income available to common shareholders $225,187 $5,732 3828.6% ======== ====== ====== ADDITIONAL DATA Net earnings per common share - basic $4.41 $0.15 Net earnings per common share - diluted $4.38 $0.15 Dividends declared per common share $0.10 $0.17 Return on average assets 19.96% 0.66% Return on average shareholders' equity 195.16% 8.24% Interest income $51,506 $45,756 12.6% Tax equivalent adjustment 300 424 (29.2%) --- --- ----- Interest income - tax equivalent 51,806 46,180 12.2% Interest expense 14,051 16,346 (14.0%) ------ ------ ----- Net interest income - tax equivalent $37,755 $29,834 26.6% ======= ======= ==== Net interest margin 3.59% 3.68% Net interest margin (fully tax equivalent) (1) 3.61% 3.73% Full-time equivalent employees (2) 1,150 1,052 Nine months ended, Sep. 30, -------- 2009 2008 % Change ---- ---- -------- Interest income Loans, including fees $112,548 $122,121 (7.8%) Investment securities Taxable 22,954 13,257 73.1% Tax-exempt 1,172 2,214 (47.1%) ----- ----- ----- Total investment securities interest 24,126 15,471 55.9% Federal funds sold 0 627 (100.0%) - --- ------ Total interest income 136,674 138,219 (1.1%) Interest expense Deposits 30,373 45,982 (33.9%) Short-term borrowings 1,295 3,642 (64.4%) Long-term borrowings 4,534 1,497 202.9% Subordinated debentures and capital securities 880 1,025 (14.1%) --- ----- ----- Total interest expense 37,082 52,146 (28.9%) ------ ------ ----- Net interest income 99,592 86,073 15.7% Provision for loan and lease losses 41,272 8,935 361.9% ------ ----- ----- Net interest income after provision for loan and lease losses 58,320 77,138 (24.4%) Noninterest income Service charges on deposit accounts 13,776 14,906 (7.6%) Trust and wealth management fees 9,881 13,666 (27.7%) Bankcard income 4,092 4,196 (2.5%) Net gains from sales of loans 855 783 9.2% Gains on sales of investment securities 3,349 1,585 111.3% Gain on acquisition 383,330 0 N/M Income (loss) on preferred securities 277 (3,601) (107.7%) Other 5,456 7,566 (27.9%) ----- ----- ----- Total noninterest income 421,016 39,101 976.7% Noninterest expenses Salaries and employee benefits 55,927 49,847 12.2% Net occupancy 8,912 8,000 11.4% Furniture and equipment 5,527 4,960 11.4% Data processing 2,585 2,398 7.8% Marketing 2,211 1,613 37.1% Communication 2,077 2,155 (3.6%) Professional services 3,427 2,551 34.3% State intangible tax 1,944 2,071 (6.1%) FDIC expense 5,318 363 1365.0% Other 20,619 11,371 81.3% ------ ------ ---- Total noninterest expenses 108,547 85,329 27.2% ------- ------ ---- Income before income taxes 370,789 30,910 1099.6% Income tax expense 137,417 10,032 1269.8% ------- ------ ------ Net income 233,372 20,878 1017.8% Dividends on preferred stock 2,578 0 N/M ----- - --- Income available to common shareholders $230,794 $20,878 1005.4% ======== ======= ====== ADDITIONAL DATA Net earnings per common share - basic $5.37 $0.56 Net earnings per common share - diluted $5.31 $0.56 Dividends declared per common share $0.30 $0.51 Return on average assets 7.76% 0.83% Return on average shareholders' equity 78.54% 10.05% Interest income $136,674 $138,219 (1.1%) Tax equivalent adjustment 970 1,448 (33.0%) --- ----- ----- Interest income - tax equivalent 137,644 139,667 (1.4%) Interest expense 37,082 52,146 (28.9%) ------ ------ ----- Net interest income - tax equivalent $100,562 $87,521 14.9% ======== ======= ==== Net interest margin 3.59% 3.72% Net interest margin (fully tax equivalent) (1) 3.63% 3.79% Full-time equivalent employees (2) (1) The tax equivalent adjustment to net interest income recognizes the income tax savings when comparing taxable and tax-exempt assets and assumes a 35% tax rate. Management believes that it is a standard practice in the banking industry to present net interest income on a fully tax equivalent basis. Therefore, management believes, these measures provided useful information to investors by allowing them to make peer comparisons. Management also uses these measures to make peer comparisons. (2) Does not include associates from acquisitions that are currently in a temporary hire status. N/M = Not meaningful. FIRST FINANCIAL BANCORP. CONSOLIDATED QUARTERLY STATEMENTS OF INCOME (Dollars in thousands) (Unaudited) 2009 ------------------------------------------------ % Change Third Second First Year- Linked Quarter Quarter Quarter to-date Qtr. ------- ------- ------- ------- -------- Interest income Loans, including fees $44,913 $33,978 $33,657 $112,548 32.2% Investment securities Taxable 6,241 8,023 8,690 22,954 (22.2%) Tax-exempt 352 386 434 1,172 (8.8%) -------- -------- -------- -------- -------- Total investment securities interest 6,593 8,409 9,124 24,126 (21.6%) Federal funds sold 0 0 0 0 N/M -------- -------- -------- -------- -------- Total interest income 51,506 42,387 42,781 136,674 21.5% Interest expense Deposits 11,490 9,080 9,803 30,373 26.5% Short-term borrowings 261 527 507 1,295 (50.5%) Long-term borrowings 1,977 1,251 1,306 4,534 58.0% Subordinated debentures and capital securities 323 320 237 880 0.9% -------- -------- -------- -------- -------- Total interest expense 14,051 11,178 11,853 37,082 25.7% -------- -------- -------- -------- -------- Net interest income 37,455 31,209 30,928 99,592 20.0% Provision for loan and lease losses 26,655 10,358 4,259 41,272 157.3% -------- -------- -------- -------- -------- Net interest income after provision for loan and lease losses 10,800 20,851 26,669 58,320 (48.2%) Noninterest income Service charges on deposit accounts 5,408 4,289 4,079 13,776 26.1% Trust and wealth management fees 3,339 3,253 3,289 9,881 2.6% Bankcard income 1,379 1,422 1,291 4,092 (3.0%) Net gains from sales of loans 63 408 384 855 (84.6%) Gains on sales of investment securities 0 3,349 0 3,349 (100.0%) Gain on acquisition 383,330 0 0 383,330 N/M Income on preferred securities 154 112 11 277 37.5% Other 1,213 1,264 2,979 5,456 (4.0%) -------- -------- -------- -------- -------- Total noninterest income 394,886 14,097 12,033 421,016 2701.2% Noninterest expenses Salaries and employee benefits 22,051 16,223 17,653 55,927 35.9% Net occupancy 3,442 2,653 2,817 8,912 29.7% Furniture and equipment 1,874 1,851 1,802 5,527 1.2% Data processing 973 794 818 2,585 22.5% Marketing 871 700 640 2,211 24.4% Communication 737 669 671 2,077 10.2% Professional services 1,220 1,254 953 3,427 (2.7%) State intangible tax 628 648 668 1,944 (3.1%) FDIC expense 1,612 3,424 282 5,318 (52.9%) Other 12,409 4,580 3,630 20,619 170.9% -------- -------- -------- -------- -------- Total noninterest expenses 45,817 32,796 29,934 108,547 39.7% -------- -------- -------- -------- -------- Income before income taxes 359,869 2,152 8,768 370,789 16622.5% Income tax expense 133,682 702 3,033 137,417 18943.0% -------- -------- -------- -------- -------- Net income 226,187 1,450 5,735 233,372 15499.1% Dividends on preferred stock $1,000 1,000 578 2,578 0.0% -------- -------- -------- -------- -------- Income available to common shareholders $225,187 $450 $5,157 $230,794 49941.6% ======== ======== ======== ======== ======== ADDITIONAL DATA Net earnings per common share - basic $4.41 $0.01 $0.14 $5.37 Net earnings per common share - diluted $4.38 $0.01 $0.14 $5.31 Dividends declared per common share $0.10 $0.10 $0.10 $0.30 Return on average assets 19.96% 0.15% 0.62% 7.76% Return on average shareholders' equity 195.16% 1.53% 6.63% 78.54% Interest income $51,506 $42,387 $42,781 $136,674 21.5% Tax equivalent adjustment 300 307 363 970 (2.3%) -------- -------- -------- -------- -------- Interest income - tax equivalent 51,806 42,694 43,144 137,644 21.3% Interest expense 14,051 11,178 11,853 37,082 25.7% -------- -------- -------- -------- -------- Net interest income - tax equivalent $37,755 $31,516 $31,291 $100,562 19.8% ======== ======== ======== ======== ======== Net interest margin 3.59% 3.60% 3.61% 3.59% Net interest margin (fully tax equivalent) (1) 3.61% 3.64% 3.65% 3.63% Full-time equivalent employees (2) 1,150 1,048 1,063 (1) The tax equivalent adjustment to net interest income recognizes the income tax savings when comparing taxable and tax-exempt assets and assumes a 35% tax rate. Management believes that it is a standard practice in the banking industry to present net interest income on a fully tax equivalent basis. Therefore, management believes, these measures provided useful information to investors by allowing them to make peer comparisons. Management also uses these measures to make peer comparisons. (2) Does not include associates from acquisitions that are currently in a temporary hire status. N/M = Not meaningful. FIRST FINANCIAL BANCORP. CONSOLIDATED QUARTERLY STATEMENTS OF INCOME (Dollars in thousands) (Unaudited) 2008 Fourth Third Second First Full Quarter Quarter Quarter Quarter Year ------- ------- ------- ------- -------- Interest income Loans, including fees $37,864 $39,754 $39,646 $42,721 $159,985 Investment securities Taxable 6,697 5,349 4,387 3,521 19,954 Tax-exempt 519 631 792 791 2,733 -------- -------- -------- -------- -------- Total investment securities interest 7,216 5,980 5,179 4,312 22,687 Federal funds sold 6 22 40 565 633 -------- -------- -------- -------- -------- Total interest income 45,086 45,756 44,865 47,598 183,305 Interest expense Deposits 12,015 13,608 14,635 17,739 57,997 Short-term borrowings 1,186 1,720 1,130 792 4,828 Long-term borrowings 1,395 707 384 406 2,892 Subordinated debentures and capital securities 361 311 302 412 1,386 -------- -------- -------- -------- -------- Total interest expense 14,957 16,346 16,451 19,349 67,103 -------- -------- -------- -------- -------- Net interest income 30,129 29,410 28,414 28,249 116,202 Provision for loan and lease losses 10,475 3,219 2,493 3,223 19,410 -------- -------- -------- -------- -------- Net interest income after provision for loan and lease losses 19,654 26,191 25,921 25,026 96,792 Noninterest income Service charges on deposit accounts 4,752 5,348 4,951 4,607 19,658 Trust and wealth management fees 3,745 4,390 4,654 4,622 17,411 Bankcard income 1,457 1,405 1,493 1,298 5,653 Net gains from sales of loans 321 376 188 219 1,104 Gains on sales of investment securities 0 0 0 1,585 1,585 Income (loss) on preferred securities (137) (3,400) (221) 20 (3,738) Other 2,510 2,359 2,683 2,524 10,076 -------- -------- -------- -------- -------- Total noninterest income 12,648 10,478 13,748 14,875 51,749 Noninterest expenses Salaries and employee benefits 17,015 16,879 15,895 17,073 66,862 Net occupancy 2,635 2,538 2,510 2,952 10,635 Furniture and equipment 1,748 1,690 1,617 1,653 6,708 Data processing 840 791 814 793 3,238 Marketing 935 622 474 517 2,548 Communication 704 601 749 805 2,859 Professional services 912 729 1,061 761 3,463 State intangible tax 435 697 688 686 2,506 FDIC expense 158 115 121 127 521 Other 4,465 3,678 4,040 3,653 15,836 -------- -------- -------- -------- -------- Total noninterest expenses 29,847 28,340 27,969 29,020 115,176 -------- -------- -------- -------- -------- Income before income taxes 2,455 8,329 11,700 10,881 33,365 Income tax expense 371 2,597 3,892 3,543 10,403 -------- -------- -------- -------- -------- Net income 2,084 5,732 7,808 7,338 22,962 Dividends on preferred stock 0 0 0 0 0 -------- -------- -------- -------- -------- Net income available to common shareholders $2,084 $5,732 $7,808 $7,338 $22,962 ======== ======== ======== ======== ======== ADDITIONAL DATA Net earnings per common share - basic $0.06 $0.15 $0.21 $0.20 $0.62 Net earnings per common share - diluted $0.06 $0.15 $0.21 $0.20 $0.61 Dividends declared per common share $0.17 $0.17 $0.17 $0.17 $0.68 Return on average assets 0.23% 0.66% 0.93% 0.89% 0.67% Return on average shareholders' equity 2.89% 8.24% 11.26% 10.66% 8.21% Interest income $45,086 $45,756 $44,865 $47,598 $183,305 Tax equivalent adjustment 360 424 510 514 1,808 -------- -------- -------- -------- -------- Interest income - tax equivalent 45,446 46,180 45,375 48,112 185,113 Interest expense 14,957 16,346 16,451 19,349 67,103 -------- -------- -------- -------- -------- Net interest income - tax equivalent $30,489 $29,834 $28,924 $28,763 $118,010 ======== ======== ======== ======== ======== Net interest margin 3.67% 3.68% 3.72% 3.78% 3.71% Net interest margin (fully tax equivalent) (1) 3.71% 3.73% 3.78% 3.85% 3.77% Full-time equivalent employees 1,061 1,052 1,058 1,056 (1) The tax equivalent adjustment to net interest income recognizes the income tax savings when comparing taxable and tax-exempt assets and assumes a 35% tax rate. Management believes that it is a standard practice in the banking industry to present net interest income on a fully tax equivalent basis. Therefore, management believes, these measures provided useful information to investors by allowing them to make peer comparisons. Management also uses these measures to make peer comparisons. N/M = Not meaningful. FIRST FINANCIAL BANCORP. CONSOLIDATED STATEMENTS OF CONDITION (Dollars in thousands) (Unaudited) Sep. 30, Jun. 30, Mar. 31, Dec. 31, 2009 2009 2009 2008 ---- ---- ---- ---- ASSETS Cash and due from banks $243,924 $74,347 $72,508 $100,935 Federal funds sold 728,853 6,591 7,055 0 Investment securities trading 338 184 72 61 Investment securities available-for-sale 523,355 528,179 732,868 659,756 Investment securities held-to-maturity 17,928 4,536 4,701 4,966 Other investments 87,693 27,976 27,976 27,976 Loans held for sale 2,729 6,193 6,342 3,854 Loans Commercial 818,953 876,730 850,111 807,720 Real estate - construction 245,535 266,452 251,115 232,989 Real estate - commercial 1,039,599 988,901 859,303 846,673 Real estate - residential 331,678 337,704 360,013 383,599 Installment 87,387 88,370 91,767 98,581 Home equity 327,779 307,749 298,000 286,110 Credit card 27,713 27,023 26,191 27,538 Lease financing 18 25 45 50 -- -- -- -- Total loans, excluding covered loans 2,878,662 2,892,954 2,736,545 2,683,260 Covered loans 2,056,156 0 0 0 --------- - - - Total loans 4,934,818 2,892,954 2,736,545 2,683,260 Less Allowance for loan and lease losses 55,770 38,649 36,437 35,873 ------ ------ ------ ------ Net loans 4,879,048 2,854,305 2,700,108 2,647,387 Premises and equipment 105,707 86,216 85,385 84,105 Goodwill 46,931 28,261 28,261 28,261 Other intangibles 7,105 465 500 1,002 OREO covered by loss share 12,022 0 0 0 FDIC indemnification asset 316,860 0 0 0 Accrued interest and other assets 287,409 166,100 143,420 140,839 ------- ------- ------- ------- Total Assets $7,259,902 $3,783,353 $3,809,196 $3,699,142 ========== ========== ========== ========== LIABILITIES Deposits Interest-bearing $1,364,556 $599,365 $622,263 $636,945 Savings 965,750 657,300 705,229 583,081 Time 2,703,392 1,111,399 1,137,398 1,150,208 --------- --------- --------- --------- Total interest- bearing deposits 5,033,698 2,368,064 2,464,890 2,370,234 Noninterest- bearing 802,286 423,781 427,068 413,283 ------- ------- ------- ------- Total deposits 5,835,984 2,791,845 2,891,958 2,783,517 Short-term borrowings Federal funds purchased and securities sold under agreements to repurchase 35,763 206,777 162,549 147,533 Federal Home Loan Bank 65,000 125,000 160,000 150,000 Other 0 25,000 40,000 57,000 - ------ ------ ------ Total short-term borrowings 100,763 356,777 362,549 354,533 Long-term debt 410,356 135,908 136,832 148,164 Other long-term debt 20,620 20,620 20,620 20,620 Accrued interest and other liabilities 220,932 31,567 43,477 43,981 ------- ------ ------ ------ Total Liabilities 6,588,655 3,336,717 3,455,436 3,350,815 SHAREHOLDERS' EQUITY Preferred stock 78,271 78,173 78,075 78,019 Common stock 490,854 490,292 394,887 394,169 Retained earnings 294,231 74,285 77,695 76,339 Accumulated other comprehensive loss (6,659) (10,700) (8,564) (11,905) Treasury stock, at cost (185,450) (185,414) (188,333) (188,295) -------- -------- -------- -------- Total Shareholders' Equity 671,247 446,636 353,760 348,327 ------- ------- ------- ------- Total Liabilities and Shareholders' Equity $7,259,902 $3,783,353 $3,809,196 $3,699,142 ========== ========== ========== ========== Sep. 30, % Change % Change 2008 Linked Qtr. Comparable Qtr. ---- ----------- --------------- ASSETS Cash and due from banks $90,341 228.1% 170.0% Federal funds sold 0 10958.3% N/M Investment securities trading 198 83.7% 70.7% Investment securities available-for-sale 492,554 (0.9%) 6.3% Investment securities held-to-maturity 5,037 295.2% 255.9% Other investments 34,976 213.5% 150.7% Loans held for sale 2,437 (55.9%) 12.0% Loans Commercial 819,430 (6.6%) (0.1%) Real estate - construction 203,809 (7.9%) 20.5% Real estate - commercial 814,578 5.1% 27.6% Real estate - residential 424,902 (1.8%) (21.9%) Installment 106,456 (1.1%) (17.9%) Home equity 276,943 6.5% 18.4% Credit card 27,047 2.6% 2.5% Lease financing 92 (28.0%) (80.4%) -- ----- ----- Total loans, excluding covered loans 2,673,257 (0.5%) 7.7% Covered loans 0 N/M N/M - --- --- Total loans 2,673,257 70.6% 84.6% Less Allowance for loan and lease losses 30,353 44.3% 83.7% ------ ---- ---- Net loans 2,642,904 70.9% 84.6% Premises and equipment 81,989 22.6% 28.9% Goodwill 28,261 66.1% 66.1% Other intangibles 872 1428.0% 714.8% OREO covered by loss share 0 N/M N/M FDIC indemnification asset 0 N/M N/M Accrued interest and other assets 132,107 73.0% 117.6% ------- ---- ----- Total Assets $3,511,676 91.9% 106.7% ========== ==== ===== LIABILITIES Deposits Interest-bearing $580,417 127.7% 135.1% Savings 608,438 46.9% 58.7% Time 1,118,511 143.2% 141.7% --------- ----- ----- Total interest- bearing deposits 2,307,366 112.6% 118.2% Noninterest- bearing 404,315 89.3% 98.4% ------- ---- ---- Total deposits 2,711,681 109.0% 115.2% Short-term borrowings Federal funds purchased and securities sold under agreements to repurchase 45,495 (82.7%) (21.4%) Federal Home Loan Bank 215,000 (48.0%) (69.8%) Other 53,000 (100.0%) (100.0%) ------ ------ ------ Total short-term borrowings 313,495 (71.8%) (67.9%) Long-term debt 152,568 201.9% 169.0% Other long-term debt 20,620 0.0% 0.0% Accrued interest and other liabilities 36,092 599.9% 512.1% ------ ----- ----- Total Liabilities 3,234,456 97.5% 103.7% SHAREHOLDERS' EQUITY Preferred stock 0 0.1% N/M Common stock 391,249 0.1% 25.5% Retained earnings 80,632 296.1% 264.9% Accumulated other comprehensive loss (6,285) (37.8%) 6.0% Treasury stock, at cost (188,376) 0.0% (1.6%) -------- --- ---- Total Shareholders' Equity 277,220 50.3% 142.1% ------- ---- ----- Total Liabilities and Shareholders' Equity $3,511,676 91.9% 106.7% ========== ==== ===== N/M = Not meaningful. FIRST FINANCIAL BANCORP. AVERAGE CONSOLIDATED STATEMENTS OF CONDITION (Dollars in thousands) (Unaudited) Quarterly Averages Sep. 30, Jun. 30, Mar. 31, Dec. 31, 2009 2009 2009 2008 ---- ---- ---- ---- ASSETS Cash and due from banks $107,216 $72,402 $78,359 $87,307 Federal funds sold 136,210 8,614 7,291 1,737 Investment securities 578,243 731,119 758,257 574,893 Loans held for sale 2,629 5,942 5,085 1,876 Loans Commercial 856,127 843,183 825,399 809,869 Real estate - construction 261,604 257,487 242,750 220,839 Real estate - commercial 1,003,005 869,985 858,403 830,121 Real estate - residential 333,978 348,834 372,853 417,499 Installment 87,672 89,857 94,881 102,814 Home equity 316,905 302,159 291,038 280,900 Credit card 27,292 26,577 26,641 26,902 Lease financing 22 39 47 75 -- -- -- -- Total loans, excluding covered loans 2,886,605 2,738,121 2,712,012 2,689,019 Covered loans 462,952 0 0 0 ------- - - - Total loans 3,349,557 2,738,121 2,712,012 2,689,019 Less Allowance for loan and lease losses 42,034 36,644 37,189 29,710 ------ ------ ------ ------ Net loans 3,307,523 2,701,477 2,674,823 2,659,309 Premises and equipment 90,997 85,433 84,932 83,307 Goodwill 40,442 28,261 28,261 28,261 Other intangibles 24,357 489 982 613 OREO covered by loss share 7,703 0 0 0 FDIC indemnification asset 77,790 0 0 0 Accrued interest and other assets 123,217 150,721 139,520 128,748 ------- ------- ------- ------- Total Assets $4,496,327 $3,784,458 $3,777,510 $3,566,051 ========== ========== ========== ========== LIABILITIES Deposits Interest- bearing $745,604 $630,885 $642,934 $611,129 Savings 835,615 645,197 620,509 604,370 Time 1,484,158 1,131,972 1,142,257 1,151,622 --------- --------- --------- --------- Total interest- bearing deposits 3,065,377 2,408,054 2,405,700 2,367,121 Noninterest- bearing 543,320 425,330 416,206 412,644 ------- ------- ------- ------- Total deposits 3,608,697 2,833,384 2,821,906 2,779,765 Short-term borrowings Federal funds purchased and securities sold under agreements to repurchase 55,197 176,592 127,652 98,690 Federal Home Loan Bank 72,855 169,341 218,100 150,867 Other 22,826 39,836 56,078 53,044 ------ ------ ------ ------ Total short-term borrowings 150,878 385,769 401,830 302,601 Long-term debt 205,908 136,189 144,358 151,434 Other long-term debt 20,620 20,620 20,620 20,620 ------ ------ ------ ------ Total borrowed funds 377,406 542,578 566,808 474,655 Accrued interest and other liabilities 50,415 28,552 37,939 25,049 ------ ------ ------ ------ Total Liabilities 4,036,518 3,404,514 3,426,653 3,279,469 SHAREHOLDERS' EQUITY Preferred stock 78,221 78,126 78,038 7,805 Common stock 490,596 418,086 394,500 391,601 Retained earnings 85,699 78,296 77,317 81,932 Accumulated other comprehensive loss (9,290) (7,936) (10,677) (6,462) Treasury stock, at cost (185,417) (186,628) (188,321) (188,294) -------- -------- -------- -------- Total Shareholders' Equity 459,809 379,944 350,857 286,582 ------- ------- ------- ------- Total Liabilities and Shareholders' Equity $4,496,327 $3,784,458 $3,777,510 $3,566,051 ========== ========== ========== ========== Quarterly Averages Year-to-Date Averages Sep. 30, Sep. 30, 2008 2009 2008 ---- ---- ---- ASSETS Cash and due from banks $89,498 $86,098 $85,915 Federal funds sold 3,137 51,177 24,266 Investment securities 467,524 688,547 411,967 Loans held for sale 2,080 4,543 2,743 Loans Commercial 819,199 841,682 801,956 Real estate - construction 192,731 254,016 177,993 Real estate - commercial 797,143 910,994 751,168 Real estate - residential 490,089 351,746 509,759 Installment 110,933 90,777 121,564 Home equity 270,659 303,462 260,145 Credit card 26,692 26,839 26,162 Lease financing 103 36 202 --- -- --- Total loans, excluding covered loans 2,707,549 2,779,552 2,648,949 Covered loans 0 156,013 0 - ------- - Total loans 2,707,549 2,935,565 2,648,949 Less Allowance for loan and lease losses 29,739 38,640 29,284 ------ ------ ------ Net loans 2,677,810 2,896,925 2,619,665 Premises and equipment 81,000 87,143 79,639 Goodwill 28,261 32,366 28,261 Other intangibles 639 8,695 657 OREO covered by loss share 0 2,596 0 FDIC indemnification asset 0 26,215 0 Accrued interest and other assets 126,699 137,759 126,230 ------- ------- ------- Total Assets $3,476,648 $4,022,064 $3,379,343 ========== ========== ========== LIABILITIES Deposits Interest-bearing $609,992 $673,517 $607,895 Savings 611,713 701,228 613,059 Time 1,158,332 1,254,048 1,190,267 --------- --------- --------- Total interest- bearing deposits 2,380,037 2,628,793 2,411,221 Noninterest-bearing 402,604 462,084 392,104 ------- ------- ------- Total deposits 2,782,641 3,090,877 2,803,325 Short-term borrowings Federal funds purchased and securities sold under agreements to repurchase 36,476 119,548 29,528 Federal Home Loan Bank 206,741 152,900 107,699 Other 53,836 39,458 57,901 ------ ------ ------ Total short-term borrowings 297,053 311,906 195,128 Long-term debt 77,035 162,377 54,380 Other long-term debt 20,620 20,620 20,620 ------ ------ ------ Total borrowed funds 394,708 494,903 270,128 Accrued interest and other liabilities 22,705 39,015 28,489 ------ ------ ------ Total Liabilities 3,200,054 3,624,795 3,101,942 SHAREHOLDERS' EQUITY Preferred stock 0 78,129 0 Common stock 390,861 434,746 390,726 Retained earnings 82,636 80,468 81,216 Accumulated other comprehensive loss (8,594) (9,296) (5,937) Treasury stock, at cost (188,309) (186,778) (188,604) -------- -------- -------- Total Shareholders' Equity 276,594 397,269 277,401 ------- ------- ------- Total Liabilities and Shareholders' Equity $3,476,648 $4,022,064 $3,379,343 ========== ========== ========== FIRST FINANCIAL BANCORP. NET INTEREST MARGIN RATE/VOLUME ANALYSIS (1) (Dollars in thousands) (Unaudited) Quarterly Averages Sep. 30, 2009 Jun. 30, 2009 Sep. 30, 2008 Balance Yield Balance Yield Balance Yield ------- ----- ------- ----- ------- ----- Earning assets Investment securities $578,243 4.52% $731,119 4.61% $467,524 5.09% Federal funds sold 136,210 0.25% 8,614 1.01% 3,137 2.79% Gross loans, including covered loans and indemnification asset (2) 3,429,976 5.20% 2,744,063 4.97% 2,709,629 5.84% --------- ---- --------- ---- --------- ---- Total earning assets 4,144,429 4.93% 3,483,796 4.89% 3,180,290 5.72% Nonearning assets Allowance for loan and lease losses (42,034) (36,644) (29,739) Cash and due from banks 107,216 72,402 89,498 Accrued interest and other assets 286,716 264,904 236,599 ------- ------- ------- Total assets $4,496,327 $3,784,458 $3,476,648 ========== ========== ========== Interest-bearing liabilities Total interest- bearing deposits $3,065,377 1.49% $2,408,054 1.51% $2,380,037 2.27% Borrowed funds Short-term borrowings 150,878 0.69% 385,769 0.55% 297,053 2.30% Long-term debt 205,908 3.81% 136,189 3.68% 77,035 3.65% Other long- term debt 20,620 6.21% 20,620 6.22% 20,620 6.00% ------ ---- ------ ---- ------ ---- Total borrowed funds 377,406 2.69% 542,578 1.55% 394,708 2.76% ------- ---- ------- ---- ------- ---- Total interest- bearing liabilities 3,442,783 1.62% 2,950,632 1.52% 2,774,745 2.34% Noninterest- bearing liabilities Noninterest- bearing demand deposits 543,320 425,330 402,604 Other liabilities 50,415 28,552 22,705 Shareholders' equity 459,809 379,944 276,594 ------- ------- ------- Total liabilities & shareholders' equity $4,496,327 $3,784,458 $3,476,648 ========== ========== ========== Net interest income (1) $37,455 $31,209 $29,410 ======= ======= ======= Net interest spread (1) 3.31% 3.37% 3.38% ==== ==== ==== Net interest margin (1) 3.59% 3.60% 3.68% ==== ==== ==== Year-to-Date Averages ------------------------- Sep. 30, 2009 Sep. 30, 2008 Balance Yield Balance Yield ------- ----- ------- ----- Earning assets Investment securities $688,547 4.68% $411,967 5.02% Federal funds sold 51,177 0.25% 24,266 3.45% Gross loans, including covered loans and indemnification asset (2) 2,966,323 5.07% 2,651,692 6.15% --------- ---- --------- ---- Total earning assets 3,706,047 4.93% 3,087,925 5.98% Nonearning assets Allowance for loan and lease losses (38,640) (29,284) Cash and due from banks 86,098 85,915 Accrued interest and other assets 268,559 234,787 ------- ------- Total assets $4,022,064 $3,379,343 ========== ========== Interest-bearing liabilities Total interest- bearing deposits $2,628,793 1.54% $2,411,221 2.55% Borrowed funds Short-term borrowings 311,906 0.56% 195,128 2.49% Long-term debt 162,377 3.73% 54,380 3.68% Other long-term debt 20,620 5.71% 20,620 6.64% ------ ---- ------ ---- Total borrowed funds 494,903 1.81% 270,128 3.05% ------- ---- ------- ---- Total interest- bearing liabilities 3,123,696 1.59% 2,681,349 2.60% Noninterest-bearing liabilities Noninterest-bearing demand deposits 462,084 392,104 Other liabilities 39,015 28,489 Shareholders' equity 397,269 277,401 ------- ------- Total liabilities & shareholders' equity $4,022,064 $3,379,343 ========== ========== Net interest income (1) $99,592 $86,073 ======= ======= Net interest spread (1) 3.34% 3.38% ==== ==== Net interest margin (1) 3.59% 3.72% ==== ==== (1) Not tax equivalent. (2) Loans held for sale, nonaccrual loans, covered loans, and indemnification asset are included in gross loans. FIRST FINANCIAL BANCORP. NET INTEREST MARGIN RATE/VOLUME ANALYSIS (1) (Dollars in thousands) (Unaudited) Linked Qtr. Comparable Qtr. Income Variance Income Variance ------------------------ ------------------------ Rate Volume Total Rate Volume Total ---- ------ ----- ---- ------ ----- Earning assets Investment securities $(164) $(1,652) $(1,816) $(649) $1,262 $613 Federal funds sold - - - (22) 0 (22) Gross loans, including covered loans and indemnification asset (2) 1,563 9,372 10,935 (4,273) 9,432 5,159 ------ ------ ------ ------ ------ ------ Total earning assets 1,399 7,720 9,119 (4,944) 10,694 5,750 Interest-bearing liabilities Total interest- bearing deposits $(152) $2,562 $2,410 $(4,687) $2,569 $(2,118) Borrowed funds Short-term borrowings 133 (399) (266) (1,206) (253) (1,459) Long-term debt 42 684 726 33 1,237 1,270 Other long-term debt (1) 4 3 12 - 12 ------ ------ ------ ------ ------ ------ Total borrowed funds 174 289 463 (1,161) 984 (177) ------ ------ ------ ------ ------ ------ Total interest- bearing liabilities 22 2,851 2,873 (5,848) 3,553 (2,295) Net interest income (1) $1,377 $4,869 $6,246 $904 $7,141 $8,045 ====== ====== ====== ====== ======= ====== Net interest spread (1) Net interest margin (1) Year-to-Date Income Variance ----------------------- Rate Volume Total ---- ------ ----- Earning assets Investment securities (1,036) $9,691 $8,655 Interest-bearing deposits with other banks Federal funds sold (627) 0 (627) Gross loans, including covered loans and indemnification asset (2) (21,511) 11,938 (9,573) ------- ------- ------- Total earning assets (23,174) 21,629 (1,545) Interest-bearing liabilities Total interest-bearing deposits $(18,123) $2,514 $(15,609) Borrowed funds Short-term borrowings (2,832) 485 (2,347) Long-term debt 21 3,016 3,037 Other long-term debt (145) - (145) ------- ------- ------- Total borrowed funds (2,956) 3,501 545 ------- ------- ------- Total interest-bearing liabilities (21,079) 6,015 (15,064) Net interest income (1) $(2,079) $15,614 $13,519 ======= ======= ======= Net interest spread (1) Net interest margin (1) (1) Not tax equivalent. (2) Loans held for sale, nonaccrual loans, covered loans, and indemnification asset are included in gross loans. FIRST FINANCIAL BANCORP. CREDIT QUALITY (excluding covered assets) (Dollars in thousands) (Unaudited) Sep. 30, Jun. 30, Mar. 31, Dec. 31, Sep. 30, YTD YTD 2009 2009 2009 2008 2008 2009 2008 ---- ---- ---- ---- ---- ---- ---- ALLOWANCE FOR LOAN AND LEASE LOSS ACTIVITY Balance at beginning of period $38,649 $36,437 $35,873 $30,353 $29,580 $35,873 $29,057 Provision for loan and lease losses 26,655 10,358 4,259 10,475 3,219 41,272 8,935 Gross charge-offs Commercial 3,622 4,707 2,521 2,168 1,568 10,850 3,059 Real estate - construct- ion 3,854 1,340 0 0 0 5,194 0 Real estate - commercial 927 1,351 382 2,083 48 2,660 1,443 Real estate - residential 471 351 231 47 335 1,053 601 Installment 315 304 400 493 424 1,019 1,470 Home equity 382 332 218 238 135 932 1,311 All other 492 386 308 374 426 1,186 1,350 --- --- --- --- --- ----- ----- Total gross charge- offs 10,063 8,771 4,060 5,403 2,936 22,894 9,234 Recoveries Commercial 91 333 60 165 179 484 489 Real estate - construct- ion 81 0 0 0 0 81 0 Real estate - commercial 86 14 16 40 37 116 59 Real estate - residential 2 20 2 5 4 24 20 Installment 205 203 254 189 225 662 786 Home equity 9 1 0 0 0 10 30 All other 55 54 33 49 45 142 211 -- -- -- -- -- --- --- Total recoveries 529 625 365 448 490 1,519 1,595 --- --- --- --- --- ----- ----- Total net charge-offs 9,534 8,146 3,695 4,955 2,446 21,375 7,639 ----- ----- ----- ----- ----- ------ ----- Ending allowance for loan and lease losses $55,770 $38,649 $36,437 $35,873 $30,353 $55,770 $30,353 ======= ======= ======= ======= ======= ======= ======= NET CHARGE-OFFS TO AVERAGE LOANS AND LEASES (ANNUALIZED) Commercial 1.64% 2.08% 1.21% 0.98% 0.67% 1.65% 0.43% Real estate - construct- ion 5.72% 2.09% 0.00% 0.00% 0.00% 2.69% 0.00% Real estate - commercial 0.33% 0.62% 0.17% 0.98% 0.01% 0.37% 0.25% Real estate - residential 0.56% 0.38% 0.25% 0.04% 0.27% 0.39% 0.15% Installment 0.50% 0.45% 0.62% 1.18% 0.71% 0.53% 0.75% Home equity 0.47% 0.44% 0.30% 0.34% 0.20% 0.41% 0.66% All other 6.35% 5.00% 4.18% 4.79% 5.66% 5.19% 5.77% ---- ---- ----- ----- ----- ----- ----- Total net charge- offs 1.31% 1.19% 0.55% 0.73% 0.36% 1.03% 0.39% ==== ==== ===== ===== ===== ===== ===== COMPONENTS OF NONPERFORMING LOANS, NONPERFORMING ASSETS, AND UNDERPERFORMING ASSETS Nonaccrual loans Commercial $13,244 $8,100 $8,412 $5,930 $5,194 13,244 $5,194 Real estate - construct- -ion 26,575 11,936 240 240 0 26,575 0 Real estate - commercial 12,407 10,130 9,170 4,779 3,361 12,407 3,361 Real estate - residential 5,253 4,897 4,724 5,363 3,742 5,253 3,742 Installment 493 394 464 459 417 493 417 Home equity 2,534 2,136 1,681 1,204 1,084 2,534 1,084 All other 0 0 0 6 32 0 32 -- -- -- -- -- -- -- Total nonaccrual loans 60,506 37,593 24,691 17,981 13,830 60,506 13,830 Restructured loans 3,102 197 201 204 208 3,102 208 ----- --- --- --- --- ----- --- Total non- performing loans 63,608 37,790 24,892 18,185 14,038 63,608 14,038 Other real estate owned (OREO) 4,301 5,166 3,513 4,028 4,610 4,301 4,610 ----- ----- ----- ----- ----- ----- ----- Total non- performing assets 67,909 42,956 28,405 22,213 18,648 67,909 18,648 Accruing loans past due 90 days or more 308 318 255 138 241 308 241 --- --- --- --- --- --- --- Total under- performing assets $68,217 $43,274 $28,660 $22,351 $18,889 68,217 $18,889 ======= ======= ======= ======= ======= ====== ======= Total classified assets $137,288 $106,315 $79,256 $67,393 $58,284 137,288 $58,284 ======== ======== ======= ======= ======= ======= ======= CREDIT QUALITY RATIOS Allowance for loan and lease losses to Nonaccrual loans 92.17% 102.81% 147.57% 199.51% 219.47% 92.17% 219.47% Non- performing loans 87.68% 102.27% 146.38% 197.27% 216.22% 87.68% 216.22% Total ending loans 1.94% 1.34% 1.33% 1.34% 1.14% 1.94% 1.14% Nonperforming loans to total loans 2.21% 1.31% 0.91% 0.68% 0.53% 2.21% 0.53% Nonperforming assets to Ending loans, plus OREO 2.36% 1.48% 1.04% 0.83% 0.70% 2.36% 0.70% Total assets 0.94% 1.14% 0.75% 0.60% 0.53% 0.94% 0.53% FIRST FINANCIAL BANCORP. CAPITAL ADEQUACY (Dollars in thousands) (Unaudited) Sep. 30, Jun. 30, Mar. 31, Dec. 31, 2009 2009 2009 2008 ---- ---- ---- ---- PER COMMON SHARE Market Price High $12.07 $11.92 $12.10 $14.30 Low $7.52 $7.35 $5.58 $10.81 Close $12.05 $7.53 $9.53 $12.39 Average common shares outstanding - basic 51,027,887 40,734,254 37,142,531 37,133,725 Average common shares outstanding - diluted 51,457,189 41,095,949 37,840,954 37,567,032 Ending common shares outstanding 51,431,422 51,434,346 37,474,422 37,481,201 REGULATORY CAPITAL Preliminary Tier 1 Capital $651,604 $454,243 $358,834 $356,307 Tier 1 Ratio 16.21% 14.77% 12.16% 12.38% Total Capital $702,102 $492,696 $395,271 $392,180 Total Capital Ratio 17.46% 16.02% 13.39% 13.62% Total Capital in excess of minimum requirement $380,470 $246,613 $159,133 $161,896 Total Risk-Weighted Assets $4,020,401 $3,076,042 $2,951,721 $2,878,548 Leverage Ratio 14.60% 12.02% 9.51% 10.00% OTHER CAPITAL RATIOS Ending shareholders' equity to ending assets 9.25% 11.81% 9.29% 9.42% Ending common shareholders' equity to ending assets 8.17% 9.74% 7.24% 7.31% Ending tangible shareholders' equity to ending tangible assets 8.57% 11.14% 8.60% 8.70% Ending tangible common shareholders' equity to ending tangible assets 7.48% 9.06% 6.54% 6.57% Average shareholders' equity to average assets 10.23% 10.04% 9.29% 8.04% Average common shareholders' equity to average assets 8.49% 7.98% 7.22% 7.82% Average tangible shareholders' equity to average tangible assets 9.13% 9.35% 8.59% 7.28% Average tangible common shareholders' equity to average tangible assets 7.37% 7.27% 6.51% 7.05% Nine months ended, Sep. 30, Sep. 30, Sep. 30, 2008 2009 2008 ---- ---- ---- PER COMMON SHARE Market Price High $14.80 $12.10 $14.80 Low $8.10 $5.58 $8.10 Close $14.60 $12.05 $14.60 Average common shares outstanding - basic 37,132,864 43,005,983 37,104,793 Average common shares outstanding - diluted 37,504,231 43,502,561 37,487,037 Ending common shares outstanding 37,476,607 51,431,422 37,476,607 REGULATORY CAPITAL Preliminary Tier 1 Capital $274,513 $651,604 $274,513 Tier 1 Ratio 9.80% 16.21% 9.80% Total Capital $304,866 $702,102 $304,866 Total Capital Ratio 10.89% 17.46% 10.89% Total Capital in excess of minimum requirement $80,806 $380,470 $80,806 Total Risk-Weighted Assets $2,800,753 $4,020,401 $2,800,753 Leverage Ratio 7.95% 14.60% 7.95% OTHER CAPITAL RATIOS Ending shareholders' equity to ending assets 7.89% 9.25% 7.89% Ending common shareholders' equity to ending assets 7.89% 8.17% 7.89% Ending tangible shareholders' equity to ending tangible assets 7.13% 8.57% 7.13% Ending tangible common shareholders' equity to ending tangible assets 7.13% 7.48% 7.13% Average shareholders' equity to average assets 7.96% 9.88% 8.21% Average common shareholders' equity to average assets 7.96% 7.93% 8.21% Average tangible shareholders' equity to average tangible assets 7.18% 8.65% 7.41% Average tangible common shareholders' equity to average tangible assets 7.18% 6.68% 7.41%

First Financial Bancorp

CONTACT: Investors/Analysts, Patti Forsythe, Vice President, Investor
Relations, +1-513-979-5837, patti.forsythe@bankatfirst.com ; or Media,
Cheryl Lipp, First Vice President, Marketing Director, +1-513-979-5797,
cheryl.lipp@bankatfirst.com, both of First Financial Bancorp