NBT Bancorp Announces Quarterly Earnings of $13.1 Million; Declares Cash Dividend
NORWICH, NY--(MARKET WIRE)--Jul 25, 2005 -- NBT Bancorp Inc. (NBT) (NasdaqNM: NBTB) reported today that net income for the quarter ended June 30, 2005, was $13.1 million, or $0.40 per diluted share, up 5% on a per share basis from $12.6 million, or $0.38 per diluted share for the same period a year ago. Return on average assets and return on average equity were 1.22% and 16.21%, respectively, for the quarter ended June 30, 2005, compared with 1.24% and 16.05%, respectively, for the same period in 2004. The increase in net income for the quarter ended June 30, 2005, was primarily the result of a $2.6 million increase in net interest income and a $1.1 million increase in noninterest income that was partially offset by a $2.8 million increase in noninterest expense.
Net income for the six months ended June 30, 2005, was $25.9 million, or $0.79 per diluted share, up 5% on a per share basis compared with $24.9 million or $0.75 per diluted share for the first six months of 2004. Return on average assets and return on average equity were 1.23% and 15.99%, respectively, for the six months ended June 30, 2005, compared with 1.24% and 15.89%, respectively, for the same period in 2004. The increase in net income for the six months ended June 30, 2005, was primarily the result of a $4.4 million increase in net interest income and a $1.3 million increase in noninterest income that was partially offset by an increase in noninterest expense of $4.5 million.
NBT Chairman and CEO Daryl R. Forsythe stated, "We are pleased to report another solid quarter for the Company. Earnings and loan growth continued their positive trends. The combination of exceptional customer service and commercial lending expertise that we provide has attracted and retained a loyal customer base in the markets we serve. In addition, NBT's expansion efforts into the Albany, Binghamton and northeastern Pennsylvania markets have delivered solid results in the areas of loan and deposit growth as well as noninterest income growth."
Loan and Lease Quality and Provision for Loan and Lease Losses
Nonperforming loans at June 30, 2005 were $13.5 million or 0.45% of total loans and leases compared with $13.8 million or 0.50% of total loans and leases at June 30, 2004 and $16.2 million or 0.56% of total loans and leases at December 31, 2004. The Company's allowance for loan and lease losses was 1.55% of loans and leases at June 30, 2005 compared with 1.58% at June 30, 2004, and 1.57% at December 31, 2004. The ratio of the allowance for loan and lease losses to nonperforming loans was 344.01% at June 30, 2005 compared with 315.52% at June 30, 2004, and 277.75% at December 31, 2004. Annualized net charge-offs to average loans and leases for the six months ended June 30, 2005, were 0.18%, compared with the 0.28% annualized ratio for the six months ended June 30, 2004, and the ratio for the year ended December 31, 2004 of 0.27%. The improvement in credit quality during the second quarter of 2005 was driven mainly by the sale of approximately $5.0 million in nonperforming loans.
For the quarter and six months ended June 30, 2005, the provision for loan and lease losses totaled $2.3 million and $4.1 million, respectively, compared with the $2.4 million and $4.6 million for the same periods in 2004. The slight decrease in the provision for loan and lease losses for the quarter and six months ended June 30, 2005, when compared with the same periods in 2004, was due primarily to improved credit quality and above-mentioned lower charge-offs offset somewhat by strong loan growth, as loans and leases were up 9% at June 30, 2005, when compared with the same period in 2004.
Net Interest Income
Net interest income was up 7% to $39.3 million for the quarter ended June 30, 2005, compared to $36.7 million for the same period a year ago. The increase in net interest income was attributable to 6% growth in average earning assets as well as a modest increase in the Company's net interest margin, which was 4.02% for the quarter ended June 30, 2005, up from the 3.99% for the same period in 2004. Net interest income for the six months ended June 30, 2005, increased 6%, to $78.1 million from $73.8 million in the same period for 2004. The increase in net interest income was attributable to 6% growth in average earning assets for the period as well as a modest increase in the Company's net interest margin, which was 4.06% for the six months ended June 30, 2005, up slightly from the 4.04% for the same period in 2004. The improvement in net interest margin for the quarter and the six months ended June 30, 2005, compared to the same periods in 2004 resulted primarily from earning assets repricing up faster than interest-bearing liabilities. NBT President Martin A. Dietrich commented, "Effective management of our balance sheet has enabled NBT to maintain a stable net interest margin over the past several quarters during this period of short-term rising rates."
Noninterest Income
Noninterest income for the quarter ended June 30, 2005 was $11.1 million, up $1.1 million or 11% from $10.0 million for the same period in 2004. Retirement plan administration fees were $1.2 million. This is a new service from the acquisition of EPIC Advisors, Inc. in January 2005. Other income increased $0.5 million from increases in consumer and commercial banking fees and title search revenue. Offsetting these increases was a $1.0 million decrease in broker/dealer and insurance revenue from the sale of the Company's broker/dealer subsidiary M. Griffith Inc. in March 2005.
Noninterest income for the six months ended June 30, 2005 was $21.8 million, up $1.3 million or 7% from $20.4 million for the same period in 2004. Retirement plan administration fees totaled $2.0 million, from the previously mentioned acquisition of EPIC Advisors, Inc. in January 2005. ATM and debit card fees increased $0.3 million compared with the same period a year ago, due to growth from transaction deposit accounts, which has led to an increase in the Company's debit card base. Offsetting these increases was a $1.4 million decrease in broker/dealer and insurance revenue from the previously mentioned sale of the Company's broker/dealer subsidiary M. Griffith Inc. in March 2005.
Noninterest Expense
Noninterest expense for the quarter ended June 30, 2005 was $28.7 million, up from $25.9 million for the same period in 2004. Salaries and employee benefits for the quarter ended June 30, 2005, increased $2.3 million over the same period in 2004, mainly from higher salaries from merit increases and higher incentive compensation costs. Other operating expense for the quarter ended June 30, 2005, increased $0.5 million compared with the same period in 2004, primarily from increases in insurance costs and loan underwriting expenses.
Noninterest expense for the six months ended June 30, 2005 was $57.6 million, up $4.5 million from $53.1 million for the same period in 2004. The increase in noninterest expense was driven by increases in salaries and employee benefits, occupancy and equipment expense. Salaries and employee benefits increased $3.4 million, mainly from increases in salary expense and employee benefit expense, reflecting merit increases as well as higher pension and incentive compensation costs. Occupancy expense increased $0.3 million from branch expansion in the Albany, Binghamton and northeastern Pennsylvania markets. Equipment expense increased $0.4 million, principally from ATM and technology upgrades.
Balance Sheet
Total assets were $4.4 billion at June 30, 2005, up $0.3 billion from $4.1 billion at June 30, 2004. Loans and leases increased $0.2 billion or 9% from $2.8 billion at June 30, 2004 to $3.0 billion at June 30, 2005. Loan growth was fueled by solid production from consumer and commercial loan products. Total deposits were $3.2 billion at June 30, 2005 up 5% from the same period at June 30, 2004. Stockholders' equity was $330.7 million representing total equity to total assets of 7.55% at June 30, 2005 compared with $307.7 million or a total equity to total asset ratio of 7.46% at June 30, 2004. Under previously announced stock repurchase plans, the Company acquired 671,543 shares of its common stock at an average price of $22.84 per share totaling $15.3 million for the six months ended June 30, 2005.
Dividend Declared
The NBT Board of Directors declared a third-quarter cash dividend of $0.19 per share at a meeting held today. The dividend will be paid on September 15, 2005 to shareholders of record as of September 1, 2005.
Corporate Overview
NBT is a financial services holding company headquartered in Norwich, NY, with total assets of $4.4 billion at June 30, 2005. The Company primarily operates through NBT Bank, N.A., a full-service community bank with two divisions and through a financial services company. NBT Bank, N.A. has 114 locations, including 74 NBT Bank offices in upstate New York and 40 Pennstar Bank offices in northeastern Pennsylvania. EPIC Advisors, Inc., based in Rochester, NY, is a full-service 401(k) plan recordkeeping firm. In June 2005, NBT announced that it had agreed to acquire CNB Bancorp, Inc. (CNB), with total assets of approximately $400 million, which is headquartered in Gloversville, NY. The merger is expected to close in the fourth quarter of 2005 pending regulatory and CNB shareholder approval. More information about NBT and its divisions can be found on the Internet at www.nbtbancorp.com, www.nbtbank.com, www.pennstarbank.com and www.epic1st.com.
Forward-Looking Statements
This news release contains forward-looking statements. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of the management of NBT Bancorp and its subsidiaries and on the information available to management at the time that these statements were made. There are a number of factors, many of which are beyond NBT's control, that could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following possibilities: (1) competitive pressures among depository and other financial institutions may increase significantly; (2) revenues may be lower than expected; (3) changes in the interest rate environment may reduce interest margins; (4) general economic conditions, either nationally or regionally, may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and/or a reduced demand for credit; (5) legislative or regulatory changes, including changes in accounting standards and tax laws, may adversely affect the businesses in which NBT is engaged; (6) competitors may have greater financial resources and develop products that enable such competitors to compete more successfully than NBT; and (7) adverse changes may occur in the securities markets or with respect to inflation. Forward-looking statements speak only as of the date they are made. Except as required by law, NBT does not undertake to update forward-looking statements to reflect subsequent circumstances or events.
NBT Bancorp Inc.
SELECTED FINANCIAL HIGHLIGHTS
(unaudited)
Net Percent
2005 2004 Change Change
------ ------ ------ ------
(dollars in thousands,
except share and per
share data)
Three Months Ended June 30,
Net Income $ 13,128 $ 12,568 $560 4%
Diluted Earnings Per Share $0.40 $ 0.38 $0.02 5%
Weighted Average Diluted
Common Shares
Outstanding 32,583,600 33,084,126 (500,526) -2%
Return on Average Assets 1.22% 1.24% -0.02% -2%
Return on Average Equity 16.21% 16.05% 0.16% 1%
Net Interest Margin 4.02% 3.99% 0.03% 1%
---------- ---------- ------- ---
Six Months Ended June 30,
Net Income $ 25,917 $ 24,939 $978 4%
Diluted Earnings Per Share $0.79 $ 0.75 $0.04 5%
Weighted Average Diluted
Common Shares
Outstanding 32,779,403 33,128,783 (349,380) -1%
Return on Average Assets 1.23% 1.24% -0.01% -1%
Return on Average Equity 15.99% 15.89% 0.10% 1%
Net Interest Margin 4.06% 4.04% 0.02% 0%
---------- ---------- ------- ---
Asset Quality June 30, December 31, June 30,
2005 2004 2004
-------- -------- --------
Nonaccrual Loans $ 13,041 $ 14,991 $ 13,240
90 Days Past Due and
Still Accruing $ 450 $ 1,186 $ 541
Total Nonperforming Loans $ 13,491 $ 16,177 $ 13,781
Other Real Estate
Owned (OREO) $ 395 $ 428 $ 365
Total Nonperforming
Loans and OREO $ 13,886 $ 16,605 $ 14,146
Total Nonperforming Assets $ 13,886 $ 16,605 $ 14,198
Allowance for Loan and Lease
Losses $ 46,411 $ 44,932 $ 43,482
Year-to-Date (YTD) Net
Charge-Offs $ 2,637 $ 7,334 $ 3,720
Allowance to Loans
and Leases 1.55% 1.57% 1.58%
Total Nonperforming Loans to
Loans and Leases 0.45% 0.56% 0.50%
Total Nonperforming Assets
to Assets 0.32% 0.39% 0.34%
Allowance to Nonperforming
Loans 344.01% 277.75% 315.52%
Annualized Net Charge-Offs to
YTD Average Loans and Leases 0.18% 0.27% 0.28%
-------- -------- --------
Capital
Equity to Assets 7.55% 7.89% 7.46%
Book Value Per Share $ 10.22 $ 10.11 $ 9.43
Tangible Book Value
Per Share $ 8.62 $ 8.66 $ 7.91
Tier 1 Leverage Ratio 6.91% 7.13% 6.90%
Tier 1 Capital Ratio 9.23% 9.78% 9.74%
Total Risk-Based Capital Ratio 10.48% 11.04% 11.00%
-------- -------- --------
Quarterly Common Stock Price 2005 2004 2003
Quarter End High Low High Low High Low
------ ------ ------ ------ ------ ------
March 31 $25.66 $21.48 $23.00 $21.21 $18.60 $16.75
June 30 $24.15 $20.10 23.18 19.92 19.94 17.37
September 30 24.34 21.02 21.76 19.24
December 31 26.84 21.94 22.78 19.50NBT Bancorp Inc.
SELECTED FINANCIAL HIGHLIGHTS
(unaudited)
Net Percent
2005 2004 Change Change
---- ---- ------ ------
(dollars in thousands,
except share and per
share data)
Balance Sheet as of June 30,
Loans $2,995,964 $2,753,625 $242,339 9%
Earning Assets $4,087,964 $3,860,751 $227,213 6%
Total Assets $4,381,364 $4,125,374 $255,990 6%
Deposits $3,178,059 $3,040,609 $137,450 5%
Stockholders' Equity $330,749 $307,675 $23,074 7%
---------- ---------- -------- ----
Average Balances
Quarter Ended June 30,
Loans $2,943,631 $2,698,654 $244,977 9%
Securities AFS
(excluding unrealized
gains or losses) $955,166 $974,046 ($18,880) -2%
Securities HTM $88,401 $87,802 $599 1%
Regulatory Equity Investment $36,617 $33,301 $3,316 10%
Short-Term Interest
Bearing Accounts $6,411 $7,282 ($871) -12%
Total Earning Assets $4,030,226 $3,801,085 $229,141 6%
Total Assets $4,307,004 $4,073,144 $233,860 6%
Interest Bearing Deposits $2,657,197 $2,555,590 $101,607 4%
Non-Interest Bearing Deposits $521,348 $483,650 $37,698 8%
Short-Term Borrowings $320,151 $283,701 $36,450 13%
Long-Term Borrowings $430,452 $388,331 $42,121 11%
Total Interest Bearing
Liabilities $3,407,800 $3,227,622 $180,178 6%
Stockholders' Equity $324,801 $314,980 $9,821 3%
---------- ---------- -------- ----
Average Balances
Six Months Ended June 30,
Loans $2,910,426 $2,672,384 $238,042 9%
Securities AFS (excluding
unrealized gains or losses) $954,013 $969,347 ($15,334) -2%
Securities HTM $86,602 $91,878 ($5,276) -6%
Regulatory Equity Investment $36,576 $33,648 $2,928 9%
Short-Term Interest
Bearing Accounts $6,569 $7,761 ($1,192) -15%
Total Earning Assets $3,994,186 $3,775,018 $219,168 6%
Total Assets $4,272,507 $4,052,714 $219,793 5%
Interest Bearing Deposits $2,630,965 $2,538,519 $92,446 4%
Non-Interest Bearing Deposits $513,447 $476,186 $37,261 8%
Short-Term Borrowings $324,912 $286,658 $38,254 13%
Long-Term Borrowings $421,890 $387,519 $34,371 9%
Total Interest Bearing
Liabilities $3,377,767 $3,212,696 $165,071 5%
Stockholders' Equity $327,360 $315,522 $11,838 4%
---------- ---------- -------- ----NBT Bancorp Inc. and Subsidiaries June 30, December 31, June 30,
Consolidated Balance Sheets (unaudited) 2005 2004 2004
(in thousands) ---- ---- ----
ASSETS
Cash and due from banks $ 118,358 $ 98,437 $ 102,705
Short term interest bearing accounts 6,078 8,286 7,240
Securities available for sale,
at fair value 961,944 952,542 980,097
Securities held to maturity (fair
value of $89,465, $82,712, and 88,771 81,782 79,766
$80,390, at June 30, 2005, December
31, 2004 and June 30, 2004,
respectively)
Federal Reserve and Federal Home
Loan Bank stock 39,442 36,842 35,994
Loans and leases 2,995,964 2,869,921 2,753,625
Less allowance for loan and
lease losses 46,411 44,932 43,482
---------- ---------- ----------
Net loans and leases 2,949,553 2,824,989 2,710,143
Premises and equipment, net 64,133 63,743 62,008
Goodwill 47,544 45,570 47,521
Intangible assets, net 4,092 2,013 2,189
Bank owned life insurance 32,968 32,302 31,609
Other assets 68,481 65,798 66,102
TOTAL ASSETS $4,381,364 $4,212,304 $4,125,374
---------- ---------- ----------
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Demand (noninterest bearing) $569,046 $520,218 $490,573
Savings, NOW, and money market 1,386,720 1,435,561 1,494,278
Time 1,222,293 1,118,059 1,055,758
---------- ---------- ----------
Total deposits 3,178,059 3,073,838 3,040,609
Short-term borrowings 384,171 338,823 349,144
Long-term debt 419,377 394,523 369,567
Trust preferred debentures 18,720 18,720 18,720
Other liabilities 50,288 54,167 39,659
---------- ---------- ----------
Total liabilities 4,050,615 3,880,071 3,817,699
Total stockholders' equity 330,749 332,233 307,675
---------- ---------- ----------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $4,381,364 $4,212,304 $4,125,374
---------- ---------- ----------
NBT Bancorp Inc. and
Subsidiaries Consolidated Three months ended Six months ended
Statements of Income June 30, June 30,
(unaudited) 2005 2004 2005 2004
-------- -------- -------- --------
(in thousands, except per share data)
Interest, fee and dividend income:
Loans and leases $ 46,260 $ 39,635 $ 90,204 $ 79,529
Securities available for sale 10,226 10,313 20,473 21,082
Securities held to maturity 831 755 1,634 1,552
Other 549 235 1,016 502
-------- -------- -------- --------
Total interest, fee and
dividend income 57,866 50,938 113,327 102,665
-------- -------- -------- --------
Interest expense:
Deposits 12,018 9,674 22,738 19,719
Short-term borrowings 2,207 794 4,068 1,587
Long-term debt 4,032 3,627 7,840 7,242
Trust preferred debentures 285 163 543 343
-------- -------- -------- --------
Total interest expense 18,542 14,258 35,189 28,891
-------- -------- -------- --------
Net interest income 39,324 36,680 78,138 73,774
Provision for loan and lease
losses 2,320 2,428 4,116 4,552
-------- -------- -------- --------
Net interest income after
provision for loan and
lease losses 37,004 34,252 74,022 69,222
-------- -------- -------- --------
Noninterest income:
Trust 1,251 1,142 2,503 2,249
Service charges on deposit
accounts 4,311 4,090 8,240 8,127
ATM and debit card fees 1,544 1,396 2,944 2,654
Broker/dealer and insurance
revenue 736 1,783 2,088 3,514
Net securities gains 51 29 47 38
Bank owned life insurance
income 333 409 666 794
Retirement plan administration
fees 1,156 - 2,019 -
Other 1,673 1,140 3,259 3,056
-------- -------- -------- --------
Total noninterest income 11,055 9,989 21,766 20,432
-------- -------- -------- --------
Noninterest expense:
Salaries and employee
benefits 14,848 12,542 30,071 26,655
Office supplies and postage 1,121 1,143 2,271 2,174
Occupancy 2,550 2,446 5,338 5,044
Equipment 1,931 1,781 4,027 3,634
Professional fees and
outside services 1,381 1,424 3,056 3,056
Data processing and
communications 2,530 2,852 5,188 5,544
Amortization of intangible
assets 142 71 260 142
Loan collection and other
real estate owned 208 99 609 471
Other operating 3,985 3,505 6,757 6,345
-------- -------- -------- --------
Total noninterest expense 28,696 25,863 57,577 53,065
-------- -------- -------- --------
Income before income taxes 19,363 18,378 38,211 36,589
Income taxes 6,235 5,810 12,294 11,650
-------- -------- -------- --------
Net income $ 13,128 $ 12,568 $ 25,917 $ 24,939
-------- -------- -------- --------
Earnings Per Share:
Basic $ 0.41 $ 0.38 $ 0.80 $ 0.76
Diluted $ 0.40 $ 0.38 $ 0.79 $ 0.75
-------- -------- -------- --------
NBT Bancorp Inc. and Subsidiaries
Quarterly Consolidated
Statements of Income 2Q 1Q 4Q 3Q 2Q
(unaudited) 2005 2005 2004 2004 2004
-------- -------- -------- -------- --------
(in thousands, except
per share data)
Interest, fee and
dividend income:
Loans $ 46,260 $ 43,944 $ 42,983 $ 41,283 $ 39,635
Securities available
for sale 10,226 10,247 10,398 10,784 10,313
Securities held to
maturity 831 803 761 731 755
Other 549 467 279 295 235
-------- -------- -------- -------- --------
Total interest, fee
and dividend income 57,866 55,461 54,421 53,093 50,938
-------- -------- -------- -------- --------
Interest expense:
Deposits 12,018 10,720 10,299 9,743 9,674
Short-term borrowings 2,207 1,861 1,307 1,192 794
Long-term debt 4,032 3,808 3,919 3,861 3,627
Trust preferred
debentures 285 258 235 245 163
-------- -------- -------- -------- --------
Total interest expense 18,542 16,647 15,760 15,041 14,258
-------- -------- -------- -------- --------
Net interest income 39,324 38,814 38,661 38,052 36,680
Provision for loan and
lease losses 2,320 1,796 2,750 2,313 2,428
-------- -------- -------- -------- --------
Net interest income after
provision for loan and
lease losses 37,004 37,018 35,911 35,739 34,252
-------- -------- -------- -------- --------
Noninterest income:
Trust 1,251 1,252 1,174 1,182 1,142
Service charges on
deposit accounts 4,311 3,929 4,184 4,159 4,090
ATM and debit card fees 1,544 1,400 1,402 1,474 1,396
Broker/dealer and
insurance fees 736 1,352 1,572 1,696 1,783
Net securities gains
(losses) 51 (4) 160 18 29
Bank owned life
insurance income 333 333 345 348 409
Retirement plan
administration fees 1,156 863 - - -
Other 1,673 1,586 1,503 1,240 1,140
-------- -------- -------- -------- --------
Total noninterest
income 11,055 10,711 10,340 10,117 9,989
-------- -------- -------- -------- --------
Noninterest expense:
Salaries and employee
benefits 14,848 15,223 14,063 13,345 12,542
Office supplies and
postage 1,121 1,150 1,118 1,167 1,143
Occupancy 2,550 2,788 2,416 2,445 2,446
Equipment 1,931 2,096 1,998 1,941 1,781
Professional fees and
outside services 1,381 1,675 1,583 1,536 1,424
Data processing and
communications 2,530 2,658 2,740 2,688 2,852
Amortization of
intangible assets 142 118 71 71 71
Loan collection and
other real estate
owned 208 401 431 339 99
Goodwill impairment - - 1,950 - -
Other operating 3,985 2,772 3,037 3,773 3,505
-------- -------- -------- -------- --------
Total noninterest
expense 28,696 28,881 29,407 27,305 25,863
-------- -------- -------- -------- --------
Income before income
taxes 19,363 18,848 16,844 18,551 18,378
Income taxes 6,235 6,059 4,353 5,934 5,810
-------- -------- -------- -------- --------
Net income $ 13,128 $ 12,789 $ 12,491 $ 12,617 $ 12,568
======== ======== ======== ======== ========
Earnings per share:
Basic $ 0.41 $ 0.39 $ 0.38 $ 0.38 $ 0.38
Diluted $ 0.40 $ 0.39 $ 0.38 $ 0.38 $ 0.38
======== ======== ======== ======== ========
Contact:
Daryl R. Forsythe
CEO
Michael J. Chewens
CFO
NBT Bancorp Inc.
52 South Broad Street
Norwich, NY 13815
607-337-6416