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Merger, Acquisition, and Divestiture Activity
 12 Months Ended
Dec. 31, 2025
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
Merger, Acquisition, and Divestiture Activity MERGER, ACQUISITION, AND DIVESTITURE ACTIVITY
Acquisitions
Bremer Financial Corporation
On May 1, 2025, Old National completed its acquisition of Bremer and its wholly owned subsidiary, Bremer Bank, National Association. Pursuant to the terms of the merger agreement, each outstanding share of Bremer common stock was converted into the right to receive (i) $26.22 in cash without interest, (ii) 4.182 shares of Old National common stock and (iii) cash in lieu of fractional shares.
In addition, on November 25, 2024, Old National entered into a forward sale agreement with Citibank, N.A. (the “Forward Purchaser”) to issue 19,047,619 shares of Old National common stock for an aggregate offering amount of $400.0 million and entered into an underwriting agreement with Citigroup Global Markets Inc., as representative for the underwriters named therein (collectively, the “Underwriters”) and as forward seller (the “Forward Seller”), and the Forward Purchaser. The Underwriters were also granted a 30-day option to purchase up to an additional 2,857,143 shares of Old National common stock. On November 25, 2024, the Underwriters exercised this option in full, upon which Old National entered into an additional forward sale agreement to issue 2,857,143 shares of Old National common stock. Old National physically settled in full the forward sale agreements on May 23, 2025 by delivering 21,904,762 shares of Old National common stock to the Forward Purchaser. Old National received net proceeds from such sale of shares of Old National common stock and full physical settlement of the forward sale agreements of $443.2 million.
The assets acquired and liabilities assumed in the Company’s acquisition of Bremer, both intangible and tangible, were recorded at their estimated fair values as of the merger date and have been accounted for under the acquisition method of accounting. The following table presents the preliminary valuation of the assets acquired and liabilities assumed and the fair value of consideration as of the merger date and also includes certain reclassifications to conform to the current presentation in the Consolidated Balance Sheet:
(dollars and shares in thousands)May 1,
2025
Assets
Cash and cash equivalents$449,757 
Equity securities26,070 
Investment securities2,811,108 
FHLB/Federal Reserve Bank stock93,924 
Loans held-for-sale9,883 
Loans, net of allowance for credit losses11,110,423 
Premises and equipment99,965 
Goodwill250,449 
Other intangible assets440,099 
Company-owned life insurance181,909 
Other assets797,460 
Total assets$16,271,047 
Liabilities
Deposits$12,862,357 
Securities sold under agreements to repurchase49,131 
Federal Home Loan Bank advances1,559,227 
Other borrowings205,194 
Accrued expenses and other liabilities247,243 
Total liabilities$14,923,152 
Fair value of consideration
Common stock (50,183 shares issued at $20.59 per share)
$1,033,262 
Cash314,633 
Total consideration$1,347,895 
Goodwill related to this merger will not be deductible for tax purposes.
Other intangible assets acquired included core deposit intangibles and customer relationship intangibles. The estimated fair value of the core deposit intangible was $397.1 million and is being amortized over an estimated useful life of 10 years. The estimated fair value of the customer relationship intangibles was $43.0 million and is being amortized over an estimated useful life of 12 years.
The fair value of PCD assets was $1.9 billion on the date of merger. The gross contractual amounts receivable relating to the PCD assets was $2.1 billion. Old National estimates, on the date of the merger, that $103.5 million of the contractual cash flows specific to the PCD assets will not be collected.
Merger-related costs associated with the Bremer acquisition have been expensed in 2025 totaling $132.6 million and additional merger-related and integration costs will be expensed in future periods as incurred.
As a result of the acquisition, Old National assumed sponsorship of Bremer’s defined benefit pension plan under which both plan participation and benefit accruals were subsequently frozen and the plan was then terminated. The net pension asset associated with Bremer’s defined benefit pension plan is recorded in other assets on the consolidated balance sheet. Pension costs were not material in 2025.
The Company’s results of operations in 2025 include the operating results of the acquired assets and assumed liabilities of Bremer subsequent to the acquisition on May 1, 2025. Due to the integration of certain Bremer systems and processes since the acquisition date, the Company has determined that it is impractical to report the amounts of revenue and income before income taxes of legacy Bremer subsequent to the acquisition.
Summary of Unaudited Pro-Forma Financial Information
The following table presents supplemental unaudited pro-forma financial information as if the Bremer merger had occurred on January 1, 2024. The pro-forma financial information is not necessarily indicative of the results of operations that would have occurred had the transaction been effective as of this assumed date.
Years Ended
December 31,
(dollars in thousands)20252024
Total revenues (1)
$2,774,625 $2,654,849 
Income before income taxes1,093,740 635,364 
(1)    Includes net interest income and total noninterest income.
Supplemental pro-forma income for 2025 was adjusted to exclude $132.6 million of merger-related costs, $6.5 million of provision for credit losses on unfunded loan commitments, and $69.1 million of provision for credit losses to establish an allowance for credit losses on non-PCD loans acquired as well as a $5.1 million net gain associated with the freezing of the benefits of the Bremer pension plan and subsequent termination of the plan. Supplemental pro-forma income for 2024 was adjusted to include these costs.
CapStar Financial Holdings, Inc.
On April 1, 2024, Old National completed its acquisition of CapStar and its wholly owned subsidiary, CapStar Bank, in an all-stock transaction. As of March 31, 2025, Old National finalized its valuation of all assets acquired and liabilities assumed. The following table presents a summary of the assets acquired and liabilities assumed, net of the fair value adjustments and the fair value of consideration as of the merger date:
(dollars and shares in thousands)April 1,
2024
Assets
Cash and cash equivalents$177,791 
Investment securities342,490 
FHLB/Federal Reserve Bank stock14,426 
Loans held-for-sale21,159 
Loans, net of allowance for credit losses2,120,627 
Premises and equipment22,481 
Goodwill176,535 
Other intangible assets46,125 
Company-owned life insurance91,475 
Other assets95,922 
Total assets$3,109,031 
Liabilities
Deposits$2,560,124 
FHLB advances75,000 
Other borrowings30,000 
Accrued expenses and other liabilities26,309 
Total liabilities$2,691,433 
Fair value of consideration
Common stock (24,014 shares issued at $17.41 per share)
$417,598 
Total consideration$417,598 
Goodwill related to this merger will not be deductible for tax purposes.
Other intangible assets acquired included core deposit intangibles. The estimated fair value of the core deposit intangible was $46.1 million and is being amortized over an estimated useful life of 10 years.
The fair value of PCD assets was $610.7 million on the date of merger. The gross contractual amounts receivable relating to the PCD assets was $679.3 million. Old National estimates, on the date of the merger, that $26.7 million of the contractual cash flows specific to the PCD assets will not be collected.
Merger-related costs primarily associated with the CapStar acquisition totaling $3.6 million have been expensed in 2025, compared to $26.3 million in 2024. Additional merger-related and integration costs will be expensed in future periods as incurred.