SUMMARY

MARKET STRATEGY
First Financial serves a combination of strategic metropolitan and non-metropolitan markets in Ohio, Indiana, Michigan and Kentucky through 118 full-service banking centers. In addition, the company operates 10 banking centers in the western United States that were obtained through a business combination but does not consider those markets strategic. The company announced plans to divest of those locations as allowable by its agreements with the Federal Deposit Insurance Corporation (FDIC). Market selection is based upon a number of factors, but markets are primarily chosen for their potential for growth and long-term profitability. First Financial's goal is to develop a competitive advantage through a local market focus; building long-term relationships with clients and helping them reach greater levels of success in their financial life. To help achieve its goals of superior service to an increasing number of clients, First Financial opened two new banking centers in its metropolitan markets in 2008, including a new market headquarters for its Dayton-Middletown metropolitan market and a new banking center in Crown Point, Indiana. Additionally First Financial added a commercial lending team in the Indianapolis metropolitan market. During the first quarter of 2009, First Financial opened a new banking center in Cincinnati, Ohio, and has a banking center scheduled to open during the fourth quarter in both St. Marys, Ohio and in Edgewood, Kentucky. First Financial intends to concentrate future growth plans and capital investments in its metropolitan markets. Smaller markets have historically provided stable, low-cost funding sources to First Financial and they remain an important part of First Financial's funding base. First Financial believes its historical strength in these markets should enable it to retain or improve its market share.

BUSINESS COMBINATIONS
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 Community Bank (Peoples), Irwin Union Bank and Trust Company (Irwin Union Bank) and Irwin Union Bank, F.S.B. (Irwin FSB) (collectively, 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"), with covered loans now representing 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, with all assets and liabilities 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, with all assets and liabilities 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 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 FSB 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 recorded a bargain purchase gain of $383.3 million, as required by Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 805, Business Combinations.

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
Separate and unrelated to the previously mentioned FDIC-assisted transactions, the company purchased 3 banking centers located in Indiana from Irwin Union Bank, 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. The technology conversion and operational integration of all assets acquired and liabilities assumed was complete at the acquisition date. The purchased assets and assumed liabilities were recorded at their estimated fair values. Fair values are preliminary and subject to refinement for up to one year after the closing date of the acquisition, as information relative to closing date fair values becomes available. First Financial anticipates the final determination of the fair values of these assets and liabilities will be completed in the fourth quarter of 2009.

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 purchase agreements with the FDIC and FDIC as receiver and related loss share 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

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.

OVERVIEW OF OPERATIONS
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:

† On September 18, 2009, the company assumed the banking operations of Irwin in FDIC assisted transactions, which included 27 banking centers. The estimated fair value of assets acquired exceeded the estimated fair value of liabilities assumed, resulting in a bargain purchase gain of $383.3 million and the recognition of a $241.0 million after-tax gain.

† On July 31, 2009, the company assumed the banking operations of Peoples in an FDIC-assisted transaction, 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.

† In the third quarter of 2009, First Financial experienced increased credit costs, including higher provision expense and elevated net-charge-offs. Provision expense increased 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.

Each acquisition in the third quarter of 2009 was considered a business combination and accounted for under FASB ASC Topic 805, Business Combinations, ASC Topic 820, Fair Value Measurements and Disclosures, and ASC 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. For a more detailed discussion of the transactions please see Note 3, Business Combinations.

Return on average assets for the third quarter of 2009 was 19.96% compared to 0.66% for the comparable period in 2008 and 0.15% for the linked-quarter (third quarter of 2009 compared to the second quarter of 2009). Return on average shareholders' equity for the third quarter of 2009 was 195.16% compared to 8.24% for the comparable period in 2008 and 1.53% for the linked-quarter.

Return on average assets for the first nine months of 2009 was 7.76% compared to 0.83% for the comparable period in 2008. Return on average shareholders' equity was 78.54% for the first nine months of 2009, versus 10.05% for the comparable period in 2008.

A discussion of the first nine months and third quarter of 2009 results of operations follows.

NET INTEREST INCOME
Net interest income, First Financial's principal source of income, is the excess of interest received from earning assets over interest paid on interest-bearing liabilities. For analytical purposes, net interest income is also presented in the table that follows, adjusted to a tax equivalent basis assuming a 35% marginal tax rate for interest earned on tax-exempt assets such as municipal loans and investments. This is to recognize the income tax savings that facilitates a comparison between taxable and tax-exempt assets. 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 for both management and investors by allowing them to make peer comparisons.

                                                   Three Months Ended               Nine Months Ended
(dollars in $000's)                                   September 30,                   September 30,
                                                  2009            2008            2009            2008
Net interest income                            $    37,455     $    29,410     $    99,592     $    86,073
Tax equivalent adjustment                              300             424             970           1,448
Net interest income - tax equivalent           $    37,755     $    29,834     $   100,562     $    87,521

Average earning assets                         $ 4,144,429     $ 3,180,290     $ 3,708,643     $ 3,087,925

Net interest margin *                                 3.59 %          3.68 %          3.59 %          3.72 %
Net interest margin (fully tax equivalent) *          3.61 %          3.73 %          3.63 %          3.79 %

* Margins are calculated using net interest income annualized divided by average earning assets.

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 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, as currently invested, earn a federal funds rate and are being utilized to fund anticipated runoff from deposit repricing. This negatively 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.

On a tax equivalent basis, the third quarter of 2009 net interest margin of 3.61% decreased 12 basis points from 3.73% for the third quarter of 2008 and 3 basis points from the second quarter of 2009. The 2009 year-to-date tax equivalent net interest margin of 3.63% decreased 16 basis points from the 3.79% for year-to-date 2008.

The Consolidated Average Balance Sheets and Net Interest Income Analysis that follows are presented on a GAAP basis (dollars in $000's).

QUARTERLY CONSOLIDATED AVERAGE BALANCE SHEETS AND NET INTEREST INCOME ANALYSIS

                                             September 30, 2009                             June 30, 2009                            September 30, 2008
                                     Average                      Average        Average                      Average        Average                      Average
                                     Balance       Interest        Rate          Balance       Interest        Rate          Balance       Interest        Rate
Earning assets

Investments:
Federal funds sold                 $   136,210     $       -          0.25 %   $     8,614     $       -          0.00 %   $     3,137     $      22          2.79 %
Investment securities                  578,243         6,593          4.52 %       731,119         8,409          4.61 %       467,524         5,980          5.09 %

Gross loans including covered
loans and indemnification
asset(1)                             3,429,976        44,913          5.20 %     2,744,063        33,978          4.97 %     2,709,629        39,754          5.84 %

Total earning assets                 4,144,429        51,506          4.93 %     3,483,796        42,387          4.89 %     3,180,290        45,756          5.72 %

Nonearning assets

Cash and due from banks                107,216                                      72,402                                      89,498
Allowance for loan and lease
losses                                 (42,034 )                                   (36,644 )                                   (29,739 )
Premises and equipment                  90,997                                      85,433                                      81,000
Other assets                           195,719                                     179,471                                     155,599
Total assets                       $ 4,496,327                                 $ 3,784,458                                 $ 3,476,648

Interest-bearing liabilities

Deposits:
Interest-bearing                   $   745,604           448          0.24 %   $   630,885           389          0.25 %   $   609,992         1,175          0.77 %
Savings                                835,615         2,300          1.09 %       645,197           487          0.30 %       611,713         1,227          0.80 %
Time                                 1,484,158         8,742          2.34 %     1,131,972         8,204          2.91 %     1,158,332        11,206          3.85 %

Short-term borrowings                  150,878           261          0.69 %       385,769           527          0.55 %       297,053         1,720          2.30 %
Long-term borrowings                   226,528         2,300          4.03 %       156,809         1,571          4.02 %        97,655         1,018          4.15 %

Total interest-bearing
liabilities                          3,442,783        14,051          1.62 %     2,950,632        11,178          1.52 %     2,774,745        16,346          2.34 %

Noninterest-bearing liabilities
and shareholders' equity

Noninterest-bearing demand             543,320                                     425,330                                     402,604
Other liabilities                       50,415                                      28,552                                      22,705
Shareholders' equity                   459,809                                     379,944                                     276,594
Total liabilities and
shareholders' equity               $ 4,496,327                                 $ 3,784,458                                 $ 3,476,648
Net interest income                                $  37,455                                   $  31,209                                   $  29,410

Net interest spread                                                   3.31 %                                      3.37 %                                      3.38 %
Contribution of
noninterest-bearing sources of
funds                                                                 0.27 %                                      0.23 %                                      0.30 %
Net interest margin (2)                                               3.59 %                                      3.60 %                                      3.68 %

(1) Nonaccrual loans and loans held for sale are included in average balances for each applicable loan category.

(2) Because noninterest-bearing funding sources, demand deposits, other liabilities, and shareholders' equity also support earning assets, the net interest margin exceeds the interest spread.

RATE/VOLUME ANALYSIS
The impact of changes in the volume of interest-earning assets and
interest-bearing liabilities and interest rates on net interest income is
illustrated in the following tables (dollars in $000's).

                                        Changes for the Three Months Ended September 30, 2009
                              Linked Qtr. Income Variance                Comparable Qtr. Income Variance
                           Rate          Volume         Total          Rate             Volume         Total
Earning assets
Investment securities   $      (164 )   $  (1,652 )   $  (1,816 )   $      (649 )     $    1,262     $     613
Federal funds sold                0             0             0             (22 )              0           (22 )
Gross loans (1)               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 )
Federal Home Loan
Bank long-term debt              42           684           726              33            1,237         1,270
Other long-term debt             (1 )           4             3              12                0            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
(2)                     $     1,377     $   4,869     $   6,246     $       904       $    7,141     $   8,045

(1) Loans held for sale, nonaccrual loans, covered loans, and indemnification asset are included in gross loans.

(2) Not tax equivalent.

                                                       Changes for the
                                            Nine Months Ended September 30, 2009
                                                Year-to-Date Income Variance
                                            Rate              Volume          Total
Earning assets
Investment securities                   $      (1,036 )     $     9,691     $   8,655
Federal funds sold                               (627 )               0          (627 )
Gross loans (1)                               (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 )
Federal Home Loan Bank long-term debt              21             3,016         3,037
Other long-term debt                             (145 )               0          (145 )
Total borrowed funds                           (2,956 )           3,501           545
Total interest-bearing liabilities            (21,079 )           6,015       (15,064 )
Net interest income (2)                 $      (2,095 )     $    15,614     $  13,519

(1) Loans held for sale, nonaccrual loans, covered loans, and indemnification asset are included in gross loans.
(2) Not tax equivalent.

NONINTEREST INCOME
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 $383.3 million gain on acquisition and the $0.2 million gain on FHLMC shares in the third quarter of 2009, the $0.1 million gain on FHLMC shares and $3.3 million gain on investment securities in the second quarter of 2009, and the $3.4 million loss on FHMLC shares in the third quarter of 2008, 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 earned on bank-owned life insurance and the sale of the company's