Exhibit 99.1

For:	Immediate Release	Contact:	Andrea Short
	July 18, 2019		574-235-2000

1st Source Corporation Reports Record Second Quarter Results,

Cash Dividend Declared

QUARTERLY HIGHLIGHTS

• Net income was a record $23.39 million, up 6.47% over the second quarter of 2018. Diluted net income per common share was also a record of $0.91, up from the prior year’s second quarter of $0.84.

• Return on average assets of 1.45% and return on average common shareholders’ equity of 11.89% compared to 1.43% and 11.96%, respectively in the second quarter of 2018.

• Net charge-offs of $1.19 million and nonperforming assets to loans and leases of 0.41% compared to $0.14 million and 0.89%, respectively in the second quarter of 2018.

• Average loans and leases grew $231.03 million, up 4.84% from the second quarter of 2018.

• Average deposits grew $303.44 million, up 6.12% from the second quarter of 2018.

• Net interest income increased $3.26 million, up 6.13% from the second quarter of 2018.

• Noninterest income increased $0.64 million, up 2.56% from the second quarter of 2018 (increased 5.04% excluding leased equipment depreciation).

• Noninterest expenses increased $1.48 million, up 3.22% from the second quarter of 2018 (increased 4.49% excluding leased equipment depreciation).

South Bend, IN - 1st Source Corporation (NASDAQ: SRCE), parent company of 1st Source Bank, today reported a record high net income of $23.39 million for the second quarter of 2019, an improvement of 6.47% compared to $21.96 million reported in the second quarter a year ago, bringing the 2019 year-to-date net income to $45.58 million compared to $41.08 million in 2018, an increase of 10.96%. The year-to-date net income comparison was positively impacted by increased net interest income of $7.67 million primarily due to higher loan rates and higher average loan and lease balances. It was negatively impacted by a $1.12 million rise in noninterest expense. Non-recurring 2019 items included a negative $1.10 million valuation adjustment on a repossessed asset and $1.32 million gain on the sale of our former headquarters building.

Diluted net income per common share for the second quarter of 2019 was up 8.3% to a record high of $0.91, versus $0.84 in the second quarter of 2018. Diluted net income per common share for the first half of 2019 was $1.76 compared to $1.57 earned a year earlier, a 12.1% increase.

At its July 2019 meeting, the Board of Directors approved a cash dividend of $0.27 per common share, up 8.0% from the $0.25 per common share declared a year ago. The cash dividend is payable to shareholders of record on August 5, 2019 and will be paid on August 15, 2019.

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Christopher J. Murphy III, Chairman and Chief Executive Officer, commented, “We are pleased with our record net income in the second quarter as 1st Source Corporation continues to experience organic growth in loans and leases and deposits. Seasonal trends within our specialty finance group portfolios contributed to an increase in average loans and leases during the quarter of 4.84%. Credit quality was also a bright spot for the quarter – the ratio of nonperforming assets to loans and leases of 0.41% was the lowest it has been in over ten years.”

“Recently, 1st Source was recognized as one of the 18 banks in the nation to be included in the Keefe, Bruyette & Woods, Inc. (KBW) Bank Honor Roll, with nearly 375 banking institutions having been screened in consideration for the list. Every year, the Bank Honor Roll consists of banking institutions that have had 10 consecutive years of increased earnings per share, and this year’s list in unique in that the banks included have done so since the 2009 financial crisis. To be considered for this recognition, banks must be publicly traded institutions with more than $500 million in total assets. For the last 156 years, 1st Source has been built upon strong, steady practices, and our mission has always included giving straight talk and sound advice while keeping our clients’ best interests in mind for the long-term. Being named among 18 institutions in our industry that have proven their strength since such a tumultuous time for our country is a welcome confirmation that we continue to be strong and steady and deliver on our mission.”

“The second quarter of the year also saw further investment in our banking centers - specifically our Niles and Erskine banking centers located inside the Martin’s Super Market stores in Niles, Michigan and South Bend, Indiana, respectively. The two locations underwent complete renovations and have been converted to our signature side-by-side banking model. Side-by-side banking invites the client behind the ‘teller line,’ allowing for the Bank’s clients and bankers to have a more transparent and inclusive experience. These renovations were part of an overall initiative to update our existing locations and continue our investment in the communities where we live, do business and raise families.”

SECOND QUARTER 2019 FINANCIAL RESULTS

Loans

Average loans and leases of $5.00 billion increased $231.03 million, up 4.84% in the second quarter of 2019 from the year ago quarter and have increased $143.21 million, up 2.95% from the first quarter. Year-to-date average loans and leases of $4.93 billion increased $250.11 million, up 5.34% from the first six months of 2018.

Deposits

Average deposits of $5.26 billion grew $303.44 million for the quarter ended June 30, 2019, up 6.12% from the year ago quarter and have increased $205.55 million, up 4.06% compared to the first quarter. Average deposits for the first six months of 2019 were $5.16 billion, an increase of $327.05 million, up 6.76% from the same period a year ago.

Net Interest Income and Net Interest Margin

Second quarter 2019 net interest income of $56.43 million increased $3.26 million, up 6.13% from the second quarter a year ago and increased $1.48 million, up 2.69% from the first quarter. For the first six months of 2019, tax-equivalent net interest income was $111.73 million, an increase of $7.62 million, up 7.32% compared to the same period a year ago.

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Second quarter 2019 net interest margin was 3.73%, an improvement of four basis points from the 3.69% for the same period in 2018 and decreased five basis point from the first quarter. Second quarter 2019 net interest margin on a fully tax-equivalent basis was 3.74%, an increase of three basis points from the 3.71% for the same period in 2018 and was lower by five basis points compared to the first quarter. The margin continued to see pressure from deposit competition and rate increases.

Net interest margin for the first six months of 2019 was 3.75%, an increase of six basis points from the 3.69% for the same period in 2018. Net interest margin on a fully-taxable-equivalent basis for the first half of 2019 was 3.77%, an increase of six basis points from the 3.71% for the first half of 2018.

Noninterest Income

Second quarter 2019 noninterest income of $25.66 million increased $0.64 million, up 2.56% from the second quarter a year ago and increased $1.54 million, up 6.38% from the first quarter. For the first six months of 2019, noninterest income was $49.79 million, an increase of $0.96 million, up 1.96% compared to the same period a year ago.

The growth in noninterest income during 2019 compared to a year ago was mainly due to higher debit card income from increased customer use, higher insurance commissions primarily from increased business and higher contingent commissions, reduced losses on the sale of available-for-sale securities, increased customer swap fees and higher claim proceeds on bank owned life insurance. These positives were offset by lower trust and wealth advisory fees resulting from a lower value of assets under management due to stock market movements and reduced net gains on partnership investments.

The increase in noninterest income from the first quarter of 2019 was primarily the result of seasonal trust and wealth advisory tax fees, increased debit card income, growth in deposit account fees, higher customer swap fees, and increased claim proceeds on bank owned life insurance. These positives were offset by reduced insurance commissions from seasonal contingent commissions.

Noninterest Expense

Second quarter 2019 noninterest expense of $47.35 million increased $1.48 million, up 3.22% from the second quarter a year ago and increased $2.15 million, up 4.75% from the first quarter. Excluding depreciation on leased equipment, noninterest expenses were up 4.49% from the second quarter a year ago and up 5.88% from the first quarter. For the first six months of 2019, noninterest expense was $92.56 million, an increase of $1.12 million, or 1.23% compared to the same period a year ago.

The increase in noninterest expense during 2019 compared to a year ago was mainly due to higher salaries as a result of normal merit increases, increased group insurance costs, a rise in furniture and equipment expense due to increased software maintenance costs and equipment depreciation, and growth in the provision for unfunded loan commitments. These increases were offset by higher gains on the sale of fixed assets, decreased incentive compensation from fewer vestings of share-based compensation arrangements, lower business development and marketing costs from fewer marketing promotions, and reduced professional fees from consulting services.

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The growth in noninterest expense from the first quarter was primarily the result of fewer gains on the sale of fixed assets, increased business development and marketing expenses, growth in the provision for unfunded loan commitments, and higher group insurance costs, offset by lower repossessed asset valuation adjustments.

Credit

The reserve for loan and lease losses as of June 30, 2019 was 2.05% of total loans and leases compared to 2.07% at March 31, 2019 and 2.13% at June 30, 2018. Net charge-offs of $1.19 million were recorded for the second quarter of 2019 compared with net charge-offs of $0.14 million in the same quarter a year ago and down from the $3.54 million of net charge-offs in the first quarter. The majority of the second quarter charge-off was related to one relationship within the medium and heavy duty truck portfolio.

The provision for loan and lease losses was $4.25 million for the second quarter of 2019, a decrease of $0.57 million compared with the same period in 2018 and a decrease of $0.67 million from the first quarter. The ratio of nonperforming assets to loans and leases was an improved 0.41% as of June 30, 2019, compared to 0.49% on March 31, 2019 and 0.89% on June 30, 2018.

Capital

As of June 30, 2019, the common equity-to-assets ratio was 11.95%, compared to 12.20% at March 31, 2019 and 11.71% a year ago. The tangible common equity-to-tangible assets ratio was 10.82% at June 30, 2019 compared to 11.03% at March 31, 2019 and 10.52% a year earlier. The Common Equity Tier 1 ratio, calculated under banking regulatory guidelines, was 11.83% at June 30, 2019 compared to 12.28% at March 31, 2019 and 12.15% a year ago. During the second quarter of 2019, 141,627 shares were repurchased for treasury reducing common shareholders’ equity by $6.42 million. During 2019, common shareholders’ equity declined by $13.68 million due to 295,787 shares acquired for treasury.

ABOUT 1ST SOURCE CORPORATION

1st Source common stock is traded on the NASDAQ Global Select Market under “SRCE” and appears in the National Market System tables in many daily newspapers under the code name “1st Src.” Since 1863, 1st Source has been committed to the success of its clients, individuals, businesses and the communities it serves. For more information, visit www.1stsource.com.

1st Source serves the northern half of Indiana and southwest Michigan and is the largest locally controlled financial institution headquartered in the area. While delivering a comprehensive range of consumer and commercial banking services through its community bank offices, 1st Source has distinguished itself with highly personalized services. 1st Source Bank also competes for business nationally by offering specialized financing services for new and used private and cargo aircraft, automobiles for leasing and rental agencies, medium and heavy duty trucks, and construction equipment. The Corporation includes 80 banking centers, 18 1st Source Bank Specialty Finance Group locations nationwide, eight Wealth Advisory Services locations and ten 1st Source Insurance offices.

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FORWARD LOOKING STATEMENTS

Except for historical information contained herein, the matters discussed in this document express “forward-looking statements.” Generally, the words “believe,” “contemplate,” “seek,” “plan,” “possible,” “assume,” “expect,” “intend,” “targeted,” “continue,” “remain,” “estimate,” “anticipate,” “project,” “will,” “should,” “indicate,” “would,” “may” and similar expressions indicate forward-looking statements. Those statements, including statements, projections, estimates or assumptions concerning future events or performance, and other statements that are other than statements of historical fact, are subject to material risks and uncertainties. 1st Source cautions readers not to place undue reliance on any forward-looking statements, which speak only as of the date made.

1st Source may make other written or oral forward-looking statements from time to time. Readers are advised that various important factors could cause 1st Source’s actual results or circumstances for future periods to differ materially from those anticipated or projected in such forward-looking statements. Such factors, among others, include changes in laws, regulations or accounting principles generally accepted in the United States; 1st Source’s competitive position within its markets served; increasing consolidation within the banking industry; unforeseen changes in interest rates; unforeseen downturns in the local, regional or national economies or in the industries in which 1st Source has credit concentrations; and other risks discussed in 1st Source’s filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K, which filings are available from the SEC. 1st Source undertakes no obligation to publicly update or revise any forward-looking statements.

NON-GAAP FINANCIAL MEASURES

The accounting and reporting policies of 1st Source conform to generally accepted accounting principles (“GAAP”) in the United States and prevailing practices in the banking industry. However, certain non-GAAP performance measures are used by management to evaluate and measure the Company’s performance. Although these non-GAAP financial measures are frequently used by investors to evaluate a financial institution, they have limitations as analytical tools, and should not be considered in isolation, or as a substitute for analyses of results as reported under GAAP. These include taxable-equivalent net interest income (including its individual components), net interest margin (including its individual components), the efficiency ratio, tangible common equity-to-tangible assets ratio and tangible book value per common share. Management believes that these measures provide users of the Company’s financial information a more meaningful view of the performance of the interest-earning assets and interest-bearing liabilities and of the Company’s operating efficiency. Other financial holding companies may define or calculate these measures differently.

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Management reviews yields on certain asset categories and the net interest margin of the Company and its banking subsidiaries on a fully taxable-equivalent (“FTE”) basis. In this non-GAAP presentation, net interest income is adjusted to reflect tax-exempt interest income on an equivalent before-tax basis. This measure ensures comparability of net interest income arising from both taxable and tax-exempt sources. Net interest income on a FTE basis is also used in the calculation of the Company’s efficiency ratio. The efficiency ratio, which is calculated by dividing non-interest expense by total taxable-equivalent net revenue (less securities gains or losses and lease depreciation), measures how much it costs to produce one dollar of revenue. Securities gains or losses and lease depreciation are excluded from this calculation to better match revenue from daily operations to operational expenses. Management considers the tangible common equity-to-tangible assets ratio and tangible book value per common share as useful measurements of the Company’s equity.

See the table marked “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of certain non-GAAP financial measures used by the Company with their most closely related GAAP measures.

# # #

(charts attached)

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1st SOURCE CORPORATION
2nd QUARTER 2019 FINANCIAL HIGHLIGHTS
(Unaudited - Dollars in thousands, except per share data)
	Three Months Ended										Six Months Ended
	June 30,			March 31,			June 30,				June 30,			June 30,
	2019			2019			2018				2019			2018
AVERAGE BALANCES
Assets	$	6,487,744		$	6,290,386		$	6,167,017			$	6,389,610		$	6,053,924
Earning assets	6,067,871			5,896,697			5,776,822				5,982,757			5,665,419
Investments	1,001,142			987,593			948,335				994,405			932,744
Loans and leases	5,001,392			4,858,183			4,770,361				4,930,183			4,680,073
Deposits	5,264,912			5,059,362			4,961,473				5,162,704			4,835,655
Interest bearing liabilities	4,468,591			4,315,545			4,370,692				4,392,491			4,263,051
Common shareholders’ equity	789,009			775,657			736,310				782,370			731,304
Total equity	792,884			777,217			736,310				785,094			731,304
INCOME STATEMENT DATA
Net interest income	$	56,427		$	54,948		$	53,169			$	111,375		$	103,701
Net interest income - FTE(1)	56,604			55,130			53,372				111,734			104,116
Provision for loan and lease losses	4,247			4,918			4,817				9,165			8,603
Noninterest income	25,664			24,124			25,023				49,788			48,830
Noninterest expense	47,353			45,204			45,877				92,557			91,434
Net income	23,417			22,196			21,964				45,613			41,080
Net income available to common shareholders	23,385			22,196			21,964				45,581			41,080
PER SHARE DATA
Basic net income per common share	$	0.91		$	0.86		$	0.84			$	1.76		$	1.57
Diluted net income per common share	0.91			0.86			0.84				1.76			1.57
Common cash dividends declared	0.27			0.27			0.24				0.54			0.46
Book value per common share(2)	31.12			30.33			28.51				31.12			28.51
Tangible book value per common share(1)	27.83			27.05			25.27				27.83			25.27
Market value - High	48.66			50.15			56.77				50.15			56.77
Market value - Low	43.34			39.11			49.58				39.11			48.26
Basic weighted average common shares outstanding	25,615,718			25,759,186			25,958,128				25,687,056			25,954,278
Diluted weighted average common shares outstanding	25,615,718			25,759,186			25,958,128				25,687,056			25,954,278
KEY RATIOS
Return on average assets	1.45		%	1.43		%	1.43		%		1.44		%	1.37		%
Return on average common shareholders’ equity	11.89			11.61			11.96				11.75			11.33
Average common shareholders’ equity to average assets	12.16			12.33			11.94				12.24			12.08
End of period tangible common equity to tangible assets(1)	10.82			11.03			10.52				10.82			10.52
Risk-based capital - Common Equity Tier 1(3)	11.83			12.28			12.15				11.83			12.15
Risk-based capital - Tier 1(3)	12.94			13.32			13.18				12.94			13.18
Risk-based capital - Total(3)	14.20			14.58			14.44				14.20			14.44
Net interest margin	3.73			3.78			3.69				3.75			3.69
Net interest margin - FTE(1)	3.74			3.79			3.71				3.77			3.71
Efficiency ratio: expense to revenue	57.68			57.17			58.67				57.43			59.94
Efficiency ratio: expense to revenue - adjusted(1)	54.07			53.20			54.71				53.64			56.05
Net charge offs to average loans and leases	0.10			0.30			0.01				0.19			0.02
Loan and lease loss reserve to loans and leases	2.05			2.07			2.13				2.05			2.13
Nonperforming assets to loans and leases	0.41			0.49			0.89				0.41			0.89
	June 30,			March 31,			December 31,				September 30,			June 30,
	2019			2019			2018				2018			2018
END OF PERIOD BALANCES
Assets	$	6,650,105		$	6,379,086		$	6,293,745			$	6,293,169		$	6,320,058
Loans and leases	5,109,337			4,926,187			4,835,464				4,825,553			4,839,823
Deposits	5,403,845			5,124,091			5,122,322				5,061,977			5,108,439
Reserve for loan and lease losses	104,911			101,852			100,469				98,300			103,007
Goodwill and intangible assets	83,985			83,992			83,998				84,097			84,104
Common shareholders’ equity	794,662			778,422			762,082				750,437			740,277
Total equity	804,686			781,101			763,590				750,437			740,277
ASSET QUALITY
Loans and leases past due 90 days or more	$	156		$	178		$	366			$	125		$	263
Nonaccrual loans and leases	12,212			13,622			27,859				36,028			34,582
Other real estate	543			417			299				432			133
Repossessions	8,799			10,411			6,666				13,041			9,389
Equipment owned under operating leases	—			64			126				48			—
Total nonperforming assets	$	21,710		$	24,692		$	35,316			$	49,674		$	44,367

(1) See “Reconciliation of Non-GAAP Financial Measures” for more information on this performance measure/ratio.

(2) Calculated as common shareholders’ equity divided by common shares outstanding at the end of the period.

(3) Calculated under banking regulatory guidelines.

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1st SOURCE CORPORATION
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Unaudited - Dollars in thousands)
	June 30,				March 31,				December 31,				June 30,
	2019				2019				2018				2018
ASSETS
Cash and due from banks	$	71,910			$	64,619			$	94,907			$	71,102
Federal funds sold and interest bearing deposits with other banks	24,578				3,062				4,172				73,358
Investment securities available-for-sale	1,021,786				1,002,809				990,129				968,349
Other investments	28,404				28,404				28,404				28,159
Mortgages held for sale	19,178				9,210				11,290				8,235
Loans and leases, net of unearned discount:
Commercial and agricultural	1,173,000				1,146,031				1,073,205				1,047,705
Auto and light truck	635,100				554,078				559,987				580,045
Medium and heavy duty truck	300,042				285,631				283,544				276,273
Aircraft	811,163				830,437				803,111				863,496
Construction equipment	686,633				641,035				645,239				642,634
Commercial real estate	835,919				818,459				809,886				769,659
Residential real estate and home equity	529,749				514,719				523,855				524,112
Consumer	137,731				135,797				136,637				135,899
Total loans and leases	5,109,337				4,926,187				4,835,464				4,839,823
Reserve for loan and lease losses	(104,911		)		(101,852		)		(100,469		)		(103,007		)
Net loans and leases	5,004,426				4,824,335				4,734,995				4,736,816
Equipment owned under operating leases, net	126,502				131,594				134,440				143,024
Net premises and equipment	51,570				51,357				52,139				53,363
Goodwill and intangible assets	83,985				83,992				83,998				84,104
Accrued income and other assets	217,766				179,704				159,271				153,548
Total assets	$	6,650,105			$	6,379,086			$	6,293,745			$	6,320,058
LIABILITIES
Deposits:
Noninterest-bearing demand	$	1,238,604			$	1,146,647			$	1,217,120			$	1,106,495
Interest-bearing deposits:
Interest-bearing demand	1,665,456				1,560,840				1,614,959				1,651,533
Savings	810,122				851,564				822,477				843,558
Time	1,689,663				1,565,040				1,467,766				1,506,853
Total interest-bearing deposits	4,165,241				3,977,444				3,905,202				4,001,944
Total deposits	5,403,845				5,124,091				5,122,322				5,108,439
Short-term borrowings:
Federal funds purchased and securities sold under agreements to repurchase	119,781				149,172				113,627				106,861
Other short-term borrowings	66,228				106,216				85,717				170,233
Total short-term borrowings	186,009				255,388				199,344				277,094
Long-term debt and mandatorily redeemable securities	71,542				71,439				71,123				71,194
Subordinated notes	58,764				58,764				58,764				58,764
Accrued expenses and other liabilities	125,259				88,303				78,602				64,290
Total liabilities	5,845,419				5,597,985				5,530,155				5,579,781
SHAREHOLDERS’ EQUITY
Preferred stock; no par value Authorized 10,000,000 shares; none issued or outstanding	—				—				—				—
Common stock; no par value Authorized 40,000,000 shares; issued 28,205,674 shares at June 30, 2019, March 31, 2019, December 31, 2018, and June 30, 2018, respectively	436,538				436,538				436,538				436,538
Retained earnings	431,091				414,428				398,980				370,521
Cost of common stock in treasury (2,670,462, 2,537,741, 2,421,946, and 2,240,597 shares at June 30, 2019, March 31, 2019, December 31, 2018, and June 30, 2018, respectively)	(75,380		)		(69,136		)		(62,760		)		(54,367		)
Accumulated other comprehensive income (loss)	2,413				(3,408		)		(10,676		)		(12,415		)
Total shareholders’ equity	794,662				778,422				762,082				740,277
Noncontrolling interests	10,024				2,679				1,508				—
Total equity	804,686				781,101				763,590				740,277
Total liabilities and equity	$	6,650,105			$	6,379,086			$	6,293,745			$	6,320,058

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1st SOURCE CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited - Dollars in thousands, except per share amounts)
	Three Months Ended												Six Months Ended
	June 30,				March 31,				June 30,				June 30,				June 30,
	2019				2019				2018				2019				2018
Interest income:
Loans and leases	$	65,599			$	62,683			$	58,520			$	128,282			$	112,211
Investment securities, taxable	5,186				5,515				4,473				10,701				9,081
Investment securities, tax-exempt	353				385				475				738				1,006
Other	499				438				397				937				805
Total interest income	71,637				69,021				63,865				140,658				123,103
Interest expense:
Deposits	12,978				11,470				8,319				24,448				14,881
Short-term borrowings	540				931				826				1,471				1,602
Subordinated notes	928				928				908				1,856				1,791
Long-term debt and mandatorily redeemable securities	764				744				643				1,508				1,128
Total interest expense	15,210				14,073				10,696				29,283				19,402
Net interest income	56,427				54,948				53,169				111,375				103,701
Provision for loan and lease losses	4,247				4,918				4,817				9,165				8,603
Net interest income after provision for loan and lease losses	52,180				50,030				48,352				102,210				95,098
Noninterest income:
Trust and wealth advisory	5,583				4,858				5,800				10,441				10,988
Service charges on deposit accounts	2,785				2,498				2,625				5,283				5,109
Debit card	3,669				3,220				3,427				6,889				6,530
Mortgage banking	999				936				1,073				1,935				1,957
Insurance commissions	1,518				2,174				1,487				3,692				3,445
Equipment rental	7,809				7,982				8,104				15,791				15,859
Losses on investment securities available-for-sale	—				—				—				—				(345		)
Other	3,301				2,456				2,507				5,757				5,287
Total noninterest income	25,664				24,124				25,023				49,788				48,830
Noninterest expense:
Salaries and employee benefits	23,787				23,495				23,696				47,282				46,227
Net occupancy	2,481				2,772				2,115				5,253				4,981
Furniture and equipment	6,289				6,024				5,718				12,313				11,173
Depreciation – leased equipment	6,400				6,524				6,684				12,924				13,112
Professional fees	1,706				1,598				1,728				3,304				3,745
Supplies and communication	1,608				1,493				1,499				3,101				3,052
FDIC and other insurance	608				645				714				1,253				1,412
Business development and marketing	1,678				949				1,725				2,627				3,258
Loan and lease collection and repossession	230				1,361				565				1,591				1,516
Other	2,566				343				1,433				2,909				2,958
Total noninterest expense	47,353				45,204				45,877				92,557				91,434
Income before income taxes	30,491				28,950				27,498				59,441				52,494
Income tax expense	7,074				6,754				5,534				13,828				11,414
Net income	23,417				22,196				21,964				$	45,613			$	41,080
Net (income) loss attributable to noncontrolling interests	(32		)		—				—				(32		)		—
Net income available to common shareholders	$	23,385			$	22,196			$	21,964			45,581				41,080
Per common share:
Basic net income per common share	$	0.91			$	0.86			$	0.84			$	1.76			$	1.57
Diluted net income per common share	$	0.91			$	0.86			$	0.84			$	1.76			$	1.57
Cash dividends	$	0.27			$	0.27			$	0.24			$	0.54			$	0.46
Basic weighted average common shares outstanding	25,615,718				25,759,186				25,958,128				25,687,056				25,954,278
Diluted weighted average common shares outstanding	25,615,718				25,759,186				25,958,128				25,687,056				25,954,278

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1st SOURCE CORPORATION
DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS’ EQUITY
INTEREST RATES AND INTEREST DIFFERENTIAL
(Unaudited - Dollars in thousands)
												Three Months Ended
	June 30, 2019											March 31, 2019											June 30, 2018
	Average Balance				Interest Income/Expense				Yield/ Rate			Average Balance				Interest Income/Expense				Yield/ Rate			Average Balance				Interest Income/Expense				Yield/ Rate
ASSETS
Investment securities available-for-sale:
Taxable	$	929,264			$	5,186			2.24	%		$	909,422			$	5,515			2.46	%		$	857,600			$	4,473			2.09	%
Tax exempt(1)	71,878				437				2.44	%		78,171				472				2.45	%		90,735				589				2.60	%
Mortgages held for sale	12,014				127				4.24	%		8,826				101				4.64	%		6,985				92				5.28	%
Loans and leases, net of unearned discount(1)	5,001,392				65,565				5.26	%		4,858,183				62,677				5.23	%		4,770,361				58,517				4.92	%
Other investments	53,323				499				3.75	%		42,095				438				4.22	%		51,141				397				3.11	%
Total earning assets(1)	6,067,871				71,814				4.75	%		5,896,697				69,203				4.76	%		5,776,822				64,068				4.45	%
Cash and due from banks	67,448											63,886											65,895
Reserve for loan and lease losses	(102,787		)									(101,697		)									(99,277		)
Other assets	455,212											431,500											423,577
Total assets	$	6,487,744										$	6,290,386										$	6,167,017
LIABILITIES AND SHAREHOLDERS’ EQUITY
Interest-bearing deposits	$	4,137,118			$	12,978			1.26	%		$	3,934,921			$	11,470			1.18	%		$	3,950,546			$	8,319			0.84	%
Short-term borrowings	201,401				540				1.08	%		251,379				931				1.50	%		290,220				826				1.14	%
Subordinated notes	58,764				928				6.33	%		58,764				928				6.40	%		58,764				908				6.20	%
Long-term debt and mandatorily redeemable securities	71,308				764				4.30	%		70,481				744				4.28	%		71,162				643				3.62	%
Total interest-bearing liabilities	4,468,591				15,210				1.37	%		4,315,545				14,073				1.32	%		4,370,692				10,696				0.98	%
Noninterest-bearing deposits	1,127,794											1,124,441											1,010,927
Other liabilities	98,475											73,183											49,088
Shareholders’ equity	789,009											775,657											736,310
Noncontrolling interests	3,875											1,560											—
Total liabilities and equity	$	6,487,744										$	6,290,386										$	6,167,017
Less: Fully tax-equivalent adjustments					(177		)									(182		)									(203		)
Net interest income/margin (GAAP-derived)(1)					$	56,427			3.73	%						$	54,948			3.78	%						$	53,169			3.69	%
Fully tax-equivalent adjustments					177											182											203
Net interest income/margin - FTE(1)					$	56,604			3.74	%						$	55,130			3.79	%						$	53,372			3.71	%
(1) See “Reconciliation of Non-GAAP Financial Measures” for more information on this performance measure/ratio.

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1st SOURCE CORPORATION
DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS’ EQUITY
INTEREST RATES AND INTEREST DIFFERENTIAL
(Unaudited - Dollars in thousands)
	Six Months Ended
	June 30, 2019											June 30, 2018
	Average Balance				Interest Income/Expense				Yield/ Rate			Average Balance				Interest Income/Expense				Yield/ Rate
ASSETS
Investment securities available-for-sale:
Taxable	$	919,398			$	10,701			2.35	%		$	835,495			$	9,081			2.19	%
Tax exempt(1)	75,007				909				2.44	%		97,249				1,244				2.58	%
Mortgages held for sale	10,429				228				4.41	%		7,350				172				4.72	%
Loans and leases, net of unearned discount(1)	4,930,183				128,242				5.25	%		4,680,073				112,216				4.84	%
Other investments	47,740				937				3.96	%		45,252				805				3.59	%
Total earning assets(1)	5,982,757				141,017				4.75	%		5,665,419				123,518				4.40	%
Cash and due from banks	65,677											63,657
Reserve for loan and lease losses	(102,245		)									(97,502		)
Other assets	443,421											422,350
Total assets	$	6,389,610										$	6,053,924
LIABILITIES AND SHAREHOLDERS’ EQUITY
Interest-bearing deposits	4,036,578				24,448				1.22	%		3,827,398				14,881				0.78	%
Short-term borrowings	226,252				1,471				1.31	%		306,150				1,602				1.06	%
Subordinated notes	58,764				1,856				6.37	%		58,764				1,791				6.15	%
Long-term debt and mandatorily redeemable securities	70,897				1,508				4.29	%		70,739				1,128				3.22	%
Total interest-bearing liabilities	4,392,491				29,283				1.34	%		4,263,051				19,402				0.92	%
Noninterest-bearing deposits	1,126,126											1,008,257
Other liabilities	85,899											51,312
Shareholders’ equity	782,370											731,304
Noncontrolling interests	2,724											—
Total liabilities and equity	$	6,389,610										$	6,053,924
Less: Fully tax-equivalent adjustments					(359		)									(415		)
Net interest income/margin (GAAP-derived)(1)					$	111,375			3.75	%						$	103,701			3.69	%
Fully tax-equivalent adjustments					359											415
Net interest income/margin - FTE(1)					$	111,734			3.77	%						$	104,116			3.71	%
(1) See “Reconciliation of Non-GAAP Financial Measures” for more information on this performance measure/ratio.

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1st SOURCE CORPORATION
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(Unaudited - Dollars in thousands, except per share data)
		Three Months Ended										Six Months Ended
		June 30,			March 31,			June 30,				June 30,			June 30,
		2019			2019			2018				2019			2018
Calculation of Net Interest Margin
(A)	Interest income (GAAP)	$	71,637		$	69,021		$	63,865			$	140,658		$	123,103
	Fully tax-equivalent adjustments:
(B)	– Loans and leases	93			95			89				188			177
(C)	– Tax exempt investment securities	84			87			114				171			238
(D)	Interest income – FTE (A+B+C)	71,814			69,203			64,068				141,017			123,518
(E)	Interest expense (GAAP)	15,210			14,073			10,696				29,283			19,402
(F)	Net interest income (GAAP) (A-E)	56,427			54,948			53,169				111,375			103,701
(G)	Net interest income - FTE (D-E)	56,604			55,130			53,372				111,734			104,116
(H)	Annualization factor	4.011			4.056			4.011				2.017			2.017
(I)	Total earning assets	$	6,067,871		$	5,896,697		$	5,776,822			$	5,982,757		$	5,665,419
	Net interest margin (GAAP-derived) (F*H)/I	3.73		%	3.78		%	3.69		%		3.75		%	3.69		%
	Net interest margin – FTE (G*H)/I	3.74		%	3.79		%	3.71		%		3.77		%	3.71		%
Calculation of Efficiency Ratio
(F)	Net interest income (GAAP)	$	56,427		$	54,948		$	53,169			$	111,375		$	103,701
(G)	Net interest income – FTE	56,604			55,130			53,372				111,734			104,116
(J)	Plus: noninterest income (GAAP)	25,664			24,124			25,023				49,788			48,830
(K)	Less: gains/losses on investment securities and partnership investments	(131		)	(17		)	(76		)		(148		)	(108		)
(L)	Less: depreciation – leased equipment	(6,400		)	(6,524		)	(6,684		)		(12,924		)	(13,112		)
(M)	Total net revenue (GAAP) (F+J)	82,091			79,072			78,192				161,163			152,531
(N)	Total net revenue – adjusted (G+J–K–L)	75,737			72,713			71,635				148,450			139,726
(O)	Noninterest expense (GAAP)	47,353			45,204			45,877				92,557			91,434
(L)	Less:depreciation – leased equipment	(6,400		)	(6,524		)	(6,684		)		(12,924		)	(13,112		)
(Q)	Noninterest expense – adjusted (O–L)	40,953			38,680			39,193				79,633			78,322
	Efficiency ratio (GAAP-derived) (O/M)	57.68		%	57.17		%	58.67		%		57.43		%	59.94		%
	Efficiency ratio – adjusted (Q/N)	54.07		%	53.20		%	54.71		%		53.64		%	56.05		%
		End of Period
		June 30,			March 31,			June 30,
		2019			2019			2018
Calculation of Tangible Common Equity-to-Tangible Assets Ratio
(R)	Total common shareholders’ equity (GAAP)	$	794,662		$	778,422		$	740,277
(S)	Less: goodwill and intangible assets	(83,985		)	(83,992		)	(84,104		)
(T)	Total tangible common shareholders’ equity (R–S)	$	710,677		$	694,430		$	656,173
(U)	Total assets (GAAP)	6,650,105			6,379,086			6,320,058
(S)	Less: goodwill and intangible assets	(83,985		)	(83,992		)	(84,104		)
(V)	Total tangible assets (U–S)	$	6,566,120		$	6,295,094		$	6,235,954
	Common equity-to-assets ratio (GAAP-derived) (R/U)	11.95		%	12.20		%	11.71		%
	Tangible common equity-to-tangible assets ratio (T/V)	10.82		%	11.03		%	10.52		%
Calculation of Tangible Book Value per Common Share
(R)	Total common shareholders’ equity (GAAP)	$	794,662		$	778,422		$	740,277
(W)	Actual common shares outstanding	25,535,212			25,667,933			25,965,077
	Book value per common share (GAAP-derived) (R/W)*1000	$	31.12		$	30.33		$	28.51
	Tangible common book value per share (T/W)*1000	$	27.83		$	27.05		$	25.27

The NASDAQ Stock Market National Market Symbol: “SRCE” (CUSIP #336901 10 3)

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