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United States Securities and Exchange Commission
Washington, D.C. 20549
Form 10-Q
(X) Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended June 30, 2004

or

(   ) Transition Report Pursuant to Section 13 or 15(d) of theSecurities
Exchange Act of 1934
For the Transition Period from ________ to ________
Commission File Number 0-14354

FIRST INDIANA CORPORATION
(Exact name of registrant as specified in its charter)

        Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes (X) No ( )

        Indicate by check mark whether the registrant is an accelerated filer (as defined by Rule 12b-2 of the Securities Exchange Act). Yes (X) No ( )

        Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

FIRST INDIANA CORPORATION AND SUBSIDIARIES
FORM 10-Q
INDEX

		Page
Part I	Financial Information
Item 1.	Financial Statements
	Condensed Consolidated Balance Sheets as of June 30, 2004, December 31, 2003, and June 30, 2003	3
	Condensed Consolidated Statements of Earnings for the Three and Six Months Ended June 30, 2004 and 2003	4
	Condensed Consolidated Statement of Shareholders’ Equity for the Six Months Ended June 30, 2004	5
	Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2004 and 2003	6
	Notes to Condensed Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	15
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	28
Item 4.	Controls and Procedures	30
Part II	Other Information
Item 1.	Legal Proceedings	31
Item 2.	Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities	31
Item 3.	Defaults upon Senior Securities	31
Item 4.	Submission of Matters to a Vote of Security Holders	31
Item 5.	Other Information	32
Item 6.	Exhibits and Reports on Form 8-K	33
	Signatures

 

2

Condensed Consolidated Balance Sheets
First Indiana Corporation and Subsidiaries
(Dollars in Thousands, Except Per Share Data)
(Unaudited)

	June 30 2004		December 31 2003		June 30 2003
Assets
Cash	$      53,983		$      58,590		$      68,065
Interest-Bearing Due from Banks	54,495		1,715		8,949
Cash and Cash Equivalents	108,478		60,305		77,014
Securities Available for Sale	216,213		215,453		156,421
Other Investments	25,509		24,957		24,316
Loans
Business	506,353		515,316		594,909
Consumer	542,946		612,025		638,982
Residential Mortgage	295,914		316,822		298,789
Single-Family Construction	183,788		192,450		203,735
Commercial Real Estate	176,283		178,378		167,435
Total Loans	1,705,284		1,814,991		1,903,850
Allowance for Loan Losses	(52,432)		(53,197)		(46,247)
Net Loans	1,652,852		1,761,794		1,857,603
Premises and Equipment	24,874		25,673		26,278
Accrued Interest Receivable	8,403		9,353		10,361
Loan Servicing Rights	5,673		5,985		8,368
Goodwill	37,042		37,042		36,940
Other Intangible Assets	4,262		4,621		4,989
Other Assets	54,373		47,954		48,765
Total Assets	$ 2,137,679		$ 2,193,137		$ 2,251,055
Liabilities
Non-Interest-Bearing Deposits	$    291,653		$    235,811		$    253,571
Interest-Bearing Deposits
Demand Deposits	180,839		217,353		212,023
Savings Deposits	510,566		400,804		427,572
Certificates of Deposit	519,659		636,004		652,418
Total Interest-Bearing Deposits	1,211,064		1,254,161		1,292,013
Total Deposits	1,502,717		1,489,972		1,545,584
Short-Term Borrowings	121,225		147,074		150,832
Federal Home Loan Bank Advances	218,325		265,488		278,550
Subordinated Notes	46,596		46,534		24,322
Accrued Interest Payable	2,152		2,156		2,560
Advances by Borrowers for Taxes and Insurance	1,026		1,533		2,736
Other Liabilities	33,680		31,486		28,970
Total Liabilities	1,925,721		1,984,243		2,033,554
Shareholders' Equity
Preferred Stock, $.01 Par Value:     2,000,000 Shares Authorized;     None Issued	—		—		—
Common Stock, $.01 Par Value:      33,000,000 Shares Authorized;     Issued: 2004 — 17,584,431 Shares;      2003 — 17,473,764 and 17,372,811 Shares	176		175		174
Capital Surplus	48,270		46,595		44,472
Retained Earnings	190,502		185,012		192,005
Accumulated Other Comprehensive Income (Loss)	(2,010)		1,756		3,755
Treasury Stock at Cost:     2004 — 1,943,187 Shares;     2003 — 1,927,017 and 1,830,750 Shares	(24,980)		(24,644)		(22,905)
Total Shareholders' Equity	211,958		208,894		217,501
Total Liabilities and Shareholders' Equity	$ 2,137,679		$ 2,193,137		$ 2,251,055

See Notes to Condensed Consolidated Financial Statements

 

3

Condensed Consolidated Statements of Earnings
First Indiana Corporation and Subsidiaries
(Dollars in Thousands, Except Per Share Data)
(Unaudited)

See Notes to Condensed Consolidated Financial Statements

 

4

Condensed Consolidated Statement of Shareholders’ Equity
First Indiana Corporation and Subsidiaries
(Dollars in Thousands, Except Per Share Data)
(Unaudited)

	Common Stock				Capital		Retained		Accumulated Other Comprehensive		Treasury		Total Shareholders’
	Shares		Amount		Surplus		Earnings		Income (Loss)		Stock		Equity
Balance at December 31, 2003	15,546,747		$ 175		$ 46,595		$ 185,012		$ 1,756		$ (24,644	)	$ 208,894
Comprehensive Income:
Net Earnings	—		—		—		10,408		—		—		10,408
Unrealized Loss on Securities Available for Sale of $6,225,        Net of Income Taxes and Reclassification       Adjustment of$169, Net of Income Taxes	—		—		—		—		(3,766	)	—		(3,766	)
Total Comprehensive Income													6,642
Dividends on Common Stock — $0.165 per share	—		—		—		(5,159	)	—		—		(5,159	)
Exercise of Stock Options	122,823		1		1,688		—		—		—		1,689
Tax Benefit of Option Compensation	—		—		217		—		—		—		217
Amortization of Common Stock Issued    under Restricted Stock Plans	—		—		—		241		—		—		241
Common Stock Issued under Deferred Compensation Plan	—		—		(24	)	—		—		—		(24	)
Common Stock Issued under Stock Incentive Plan	2,785		—		49		—		—		—		49
Purchase of Treasury Stock	(20,000	)	—		—		—		—		(361	)	(361	)
Reissuance of Treasury Stock	3,830		—		49		—		—		25		74
Redemption of Common Stock	(14,941	)	—		(304	)	—		—		—		(304	)
Balance at June 30, 2004	15,641,244		$ 176		$ 48,270		$ 190,502		$ (2,010	)	$ (24,980	)	$ 211,958

See Notes to Condensed Consolidated Financial Statements

 

5

Condensed Consolidated Statements of Cash Flows
First Indiana Corporation and Subsidiaries
(Dollars in Thousands, Except Per Share Data)
(Unaudited)

	Six Months Ended June 30
	2004		2003
Cash Flows from Operating Activities
Net Earnings	$  10,408		$   3,005
Adjustments to Reconcile Net Earnings to Net Cash Provided by
Operating Activities
Gain on Sale of Loans and Investment Securities, Net	(6,123	)	(5,375	)
Amortization of Premium, Discount, and Intangibles, Net	173		1,737
Depreciation and Amortization of Premises and Equipment	1,565		1,383
Amortization of Net Deferred Loan Fees	1,323		792
Provision for Loan