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NBT Bancorp Inc. Announces Net Income of $19.3 Million for the Second Quarter of 2015, Second Highest in the Company’s History; Declares Cash Dividend

07/27/15

NORWICH, N.Y., July 27, 2015 (GLOBE NEWSWIRE) -- NBT Bancorp Inc. (NBT) (NASDAQ:NBTB) announced reported net income for the three months ended June 30, 2015 was $19.3 million, up from $18.2 million for the first quarter of 2015, and down from $27.6 million for the second quarter of 2014.  Reported net income for the second quarter of 2014 included an $11.2 million net gain (after taxes and related incentive compensation) on the sale of our ownership interest in Springstone LLC (“Springstone”), partially offset by $2.9 million in prepayment penalties, net of tax, related to our long-term debt restructuring strategy.  Reported diluted earnings per share for the three months ended June 30, 2015 was $0.43, as compared with $0.41 for the prior quarter, and $0.62 per share for the second quarter of 2014. 

Core net income for the three months ended June 30, 2015 was $19.6 million, up from $18.2 million in the previous quarter, and up from $19.1 million from the same period last year.  Core earnings per diluted share for the three months ended June 30, 2015 was $0.44, up from $0.41 for the first quarter of 2015, and up from $0.43 for the second quarter of 2014.

Reported net income for the six months ended June 30, 2015 was $37.4 million, down from $45.6 million for the same period last year.  Reported net income for the six months ended June 30, 2014 included the aforementioned gain on the sale of our ownership interest in Springstone, partially offset by the aforementioned prepayment penalties related to our long-term debt restructuring strategy.  Reported diluted earnings per share for the six months ended June 30, 2015 was $0.84, as compared with $1.03 for the same period in 2014.

Core net income for the six months ended June 30, 2015 was $37.7 million, up from $37.5 million for the same period last year.  Core earnings per diluted share for the six months ended June 30, 2015 was $0.85, equivalent to the same period last year.    

The second quarter and year to date reported results for 2015 and 2014 contained items which the Company considers non-core, such as the gain on the sale of an equity investment and long-term debt restructuring prepayment penalties in 2014, and other items not considered core to our operations in both years.

Second Quarter 2015 Highlights:

  • Core net income for the second quarter of 2015 was second highest in the Company’s history
     
  • Strong second quarter organic loan growth (annualized) of 10.5% driven by:
    • Commercial – 13.1%
    • Residential mortgage – 10.2%
    • Consumer – 11.9%
       
  • Continued positive trends in asset quality indicators:
    • Nonperforming loans to total loans improved to 0.77% at June 30, 2015 from 0.85% at March 31, 2015 and 0.96% at June 30, 2014
    • Annualized net charge-offs to average loans improved to 0.30% for the second quarter of 2015, down from 0.34% for the first quarter of 2015 and 0.41% for the 2014 full year

“For the second quarter of 2015, we’re pleased to report strong earnings with both our reported and core net income at the second highest level in NBT’s history,” said NBT President and CEO Martin Dietrich. “Our bankers are contributing to these results with robust organic loan growth for the second quarter of 10.5% annualized. All sectors are performing well, particularly the commercial portfolio where growth in our established markets is being augmented by lending in our new markets in New England.”

Net interest income was $62.7 million for the second quarter of 2015, up $0.5 million from the previous quarter, and up $0.1 million from the second quarter of 2014.  FTE net interest margin was 3.51% for the three months ended June 30, 2015, down from 3.60% for the previous quarter and the second quarter of 2014.  Average interest earning assets were up $149.3 million, or 2.1%, for the second quarter of 2015 as compared to the prior quarter, and up $188.6 million, or 2.7%, from the same period in 2014.  The increase from the first quarter of 2015 was driven primarily by organic loan production.  Annualized organic loan growth of 10.5% during the second quarter of 2015 was driven by growth in most portfolios.  Yields on earning assets decreased by 10 basis points (“bps”) from 3.89% during the first quarter of 2015 to 3.79% for the second quarter of 2015, which was more than offset by the growth in earning assets during the second quarter of 2015, and resulted in modest growth in net interest income.  The yield compression was driven by a 9 bp decrease in loan yields from the first quarter of 2015 to the second quarter of 2015.  Average interest bearing liabilities increased $88.5 million, or 1.7%, from the first quarter of 2015 to the second quarter of 2015, which was driven by a 1.1% increase in interest bearing deposits for the second quarter of 2015.  We continued to experience migration of time deposits to lower cost transaction accounts and the rate paid on money market deposit accounts decreased slightly during the second quarter of 2015, which contributed to a 1 bp decrease in the rate paid on interest bearing liabilities for the three months ended June 30, 2015 as compared to the prior period.  The decrease on the rate paid on interest bearing liabilities partially offset the aforementioned rate compression on earning assets.     

Net interest income was $124.9 million for the six months ended June 30, 2015, up $0.8 million from the same period in 2014.  FTE net interest margin was 3.55% for the six months ended June 30, 2015, down from 3.62% for the six months ended June 30, 2014.  Average interest earning assets were up $159.6 million, or 2.3%, for the six months ended June 30, 2015 as compared to the same period in 2014.  This increase from last year was driven primarily by 6.3% annualized organic loan growth during the first six months of 2015.  Yields on earning assets decreased from 3.98% during the first six months of 2014 to 3.84% for the first six months of 2015, and offset the growth in earning assets resulting in a 1.2% decrease in interest income for the six months ended June 30, 2015 as compared to the same period in 2014.  The yield compression was driven by an 18 bp decrease in loan yields from the first six months of 2014 to the first six months of 2015.  Average interest bearing liabilities decreased $57.4 million, or 1.1%, from the six months ended June 30, 2014 to the six months ended June 30, 2015, which was driven by a $168.9 million decrease in average long-term borrowings due to the debt restructuring strategy completed during the third quarter of 2014.  In addition, average short-term borrowings decreased $107.0 million for the six months ended June 30, 2015 as compared to the same period last year.  These decreases were partially offset by a $218.5 million, or 5.0%, increase in interest bearing deposits for the first six months of 2015 as compared to the same period in 2014.  This deposit growth was driven by increases in money market deposit accounts as well as savings deposits in the first six months of 2015.  The rates paid on interest bearing liabilities decreased by 9 bps for the six months ended June 30, 2015 as compared to the same period in 2014.  This decrease resulted primarily from the aforementioned debt restructuring and partially offset the rate compression on earning assets.     

Noninterest income for the three months ended June 30, 2015 was $28.2 million, up $1.7 million, or 6.3% from the prior quarter, and up $1.6 million, or 6.0%, from the second quarter of 2014 when adjusted for the sale of Springstone.  The increase from the prior quarter was driven primarily by increases in trust income, ATM and debit card fees, retirement plan administration fees, and other noninterest income.  Trust revenue was up $0.7 million, or 16.8%, for the second quarter of 2015 as compared with the first quarter of 2015 due primarily to seasonality of trust revenue.  ATM and debit card fees were up $0.4 million, or 10.1%, for the second quarter of 2015 as compared to the first quarter of 2015 due primarily to increases in debit card transactions and number of accounts.  Retirement plan administration fees were up $0.4 million, or 11.6%, for the second quarter of 2015 as compared to the first quarter of 2015 due primarily to new business generation.  Other noninterest income was up $1.1 million, or 41.1%, for the second quarter of 2015 as compared to the first quarter of 2015 due primarily to an acquired loan charge-off recovery during the second quarter.  These increases were partially offset by a $0.6 million, or 40.5%, decrease in bank owned life insurance due to benefit payments received during the first quarter of 2015.  In addition, insurance and other financial services revenue decreased $0.5 million, or 8.4%, in the second quarter of 2015 as compared with the first quarter of 2015 due primarily to seasonality of insurance revenue.  

Noninterest income for the six months ended June 30, 2015 was $54.7 million, up $1.8 million, or 3.5% from the same period last year when adjusted for the sale of Springstone.  The increase from the prior year was driven primarily by increases in retirement plan administration fees, ATM and debit card fees, and other noninterest income.  Retirement plan administration fees were up $0.9 million, or 14.7%, for the first half of 2015 as compared to the same period in 2014 due primarily to new business generation.  ATM and debit card fees were up $0.5 million, or 5.9%, for the first half of 2015 as compared to the same period last year due primarily to an increase in debit card activity.    Other noninterest income was up $0.6 million, or 10.8%, for the first half of 2015 as compared to the first half of 2014. 

Noninterest expense for the three months ended June 30, 2015 was $58.0 million, up $0.3 million or 0.5% from the prior quarter and down $0.2 million from the second quarter of 2014, after adjusting for the $4.6 million in prepayment penalties incurred as a result of the debt restructuring in 2014.  The increase from the prior quarter was due primarily to a $1.0 million or 19.5%, increase in other operating expenses driven by branch reorganization expenses incurred in the second quarter of 2015.  In addition, salaries and employee benefits increased $0.6 million, or 2.2%, from the first quarter of 2015 to the second quarter of 2015.  These increases were partially offset by a decrease in occupancy expenses for the second quarter of 2015 from the first quarter of 2015 due to seasonal expenses.  Loan collection and other real estate owned expenses decreased $0.9 million from the first quarter of 2015 to the second quarter of 2015 due to gains on sales of other real estate owned recorded in the second quarter of 2015 which offset expenses during the period.  Income tax expense for the three month period ended June 30, 2015 was $9.8 million, up $0.6 million from the prior quarter, and down $4.3 million from the second quarter of 2014, which included the impact of the aforementioned non-core items.  The increase from the prior period was due primarily to a higher level of taxable income for the second quarter of 2015.  The effective tax rate was 33.6% for the first and second quarters of 2015, and 33.7% for the second quarter of 2014.

Noninterest expense for the six months ended June 30, 2015 was $115.7 million, down $4.6 million or 3.8% from the same period in 2014, due primarily to the $4.6 million in prepayment penalties incurred in the second quarter of 2014.  Excluding this non-core prepayment penalty, noninterest expense was flat for the first six months of 2015 as compared to the same period last year.  Loan collection and other real estate owned expenses decreased $0.9 million in the first six months of 2015 as compared to the same period in 2014 due to gains on sales of real estate recorded in the second quarter of 2015, which offset expenses during the period.  This decrease was offset by a $0.7 million increase in other operating expenses for the first six months of 2015 as compared to the same period in 2014, driven by the aforementioned branch reorganization expenses incurred in the second quarter of 2015.  Income tax expense for the six month period ended June 30, 2015 was $18.9 million, down $3.8 million from the six month period ended June 30, 2014.  The decrease from 2014 was due to a lower level of taxable income in 2015 primarily due to the non-core items recorded in 2014.  The effective tax rate was 33.6% for the first six months of 2015 as compared to 33.2% for the first six months of 2014.

Asset Quality

Net charge-offs were $4.3 million for the three months ended June 30, 2015, down from $4.6 million for the prior quarter, and up slightly from $4.1 million for the second quarter of 2014.  Provision expense was $3.9 million for the three months ended June 30, 2015, as compared with $3.6 million for the prior quarter, and $4.2 million for the second quarter of 2014.  Provision expense for the second quarter of 2015 was less than charge-offs due to the continued improvement in asset quality metrics.  Annualized net charge-offs to average loans for the second quarter of 2015 was 0.30%, compared with 0.34% for the first quarter of 2015 and 0.30% for the second quarter of 2014.

Nonperforming loans to total loans was 0.77% at June 30, 2015, down 8 bps from the prior quarter, and down 19 bps from June 30, 2014.  Past due loans as a percentage of total loans were 0.61% at June 30, 2015 as compared to 0.69% at December 31, 2014.   

The allowance for loan losses totaled $65.0 million at June 30, 2015, compared to $65.4 million at March 31, 2015, and $69.5 million at June 30, 2014.  The allowance for loan losses as a percentage of loans was 1.13% (1.24% excluding acquired loans with no related allowance recorded) at June 30, 2015, compared to 1.16% (1.29% excluding acquired loans with no related allowance recorded) at March 31, 2015 and 1.25% (1.44% excluding acquired loans with no related allowance recorded) at June 30, 2014.  The decrease in the allowance for loan losses as a percentage of loans from prior periods was due primarily to continued positive trends in asset quality metrics of the originated loan portfolio.

Balance Sheet

Total assets were $8.1 billion at June 30, 2015, up $274.6 million, or 3.5% from December 31, 2014.  Loans were $5.8 billion at June 30, 2015, up $175.6 million, or 3.1%, from December 31, 2014.  Total deposits were $6.4 billion at June 30, 2015, up $71.9 million, or 1.1%, from December 31, 2014.  Stockholders’ equity was $876.0 million, representing a total equity-to-total assets ratio of 10.85% at June 30, 2015, compared with $864.2 million or a total equity-to-total assets ratio of 11.08% at December 31, 2014.

Stock Repurchase Program

The Company purchased 433,351 shares of its common stock during the six months ended June 30, 2015 at an average price of $24.63 per share under a previously announced plan.  As of June 30, 2015, there were 566,649 shares available for repurchase under this plan, which expires on December 31, 2016.  On July 27, 2015, the NBT Board of Directors authorized a new repurchase program for NBT to repurchase up to an additional 1,000,000 shares of its outstanding common stock.  This plan expires on December 31, 2016.

Dividend

The NBT Board of Directors approved a 2015 third-quarter cash dividend of $0.22 per share at a meeting held today.  The dividend will be paid on September 15, 2015 to shareholders of record as of September 1, 2015.
  
Corporate Overview

NBT Bancorp Inc. is a financial holding company headquartered in Norwich, N.Y., with total assets of $8.1 billion at June 30, 2015.  The company primarily operates through NBT Bank, N.A., a full-service community bank, and through two financial services companies.  NBT Bank, N.A. has over 155 banking locations with offices in New York, Pennsylvania, Vermont, Massachusetts, New Hampshire and Maine. EPIC Advisors, Inc., based in Rochester, N.Y., is a full-service 401(k) plan recordkeeping firm. NBT-Mang Insurance Agency, based in Norwich, N.Y., is a full-service insurance agency. More information about NBT and its divisions can be found on the Internet at: www.nbtbancorp.com, www.nbtbank.com, www.epic1st.com and www.nbtmang.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 update forward-looking statements to reflect subsequent circumstances or events.

Non-GAAP Measures

This press release contains financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (GAAP).  These measures adjust GAAP measures to exclude the effects of sales of securities and certain non-recurring and merger-related expenses.  Where non-GAAP disclosures are used in this press release, the comparable GAAP measure, as well as a reconciliation to the comparable GAAP measure, is provided in the accompanying tables.  Management believes that these non-GAAP measures provided useful information that is important to an understanding of the operating results of NBT’s core business (due to the non-recurring nature of the excluded items).  Non-GAAP measures should not be considered a substitute for financial measures determined in accordance with GAAP and investors should consider NBT’s performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of NBT.

NBT Bancorp Inc. and Subsidiaries            
SELECTED FINANCIAL DATA            
(unaudited, dollars in thousands except per share data)            
             
    2015     2014    
  2nd Q 1st Q 4th Q 3rd Q 2nd Q  
Reconciliation of Non-GAAP Financial Measures:            
Reported net income (GAAP) $ 19,281   $ 18,166   $ 18,513   $ 10,912   $ 27,640    
Adj: (Gain) / Loss on sale of securities, net (net of tax)     (17 )     (9 )     (22 )     (25 )     (9 )  
Adj: Other adjustments (net of tax) (1)      324       -        11       83       (315 )  
Adj: Gain on sale of Springstone (net of tax and related incentive compensation)     -        -        -        -        (11,168 )  
Adj: Prepayment penalties related to debt restructuring (net of tax)     -        -        -        8,833       2,925    
Total Adjustments     307       (9 )     (11 )     8,891       (8,567 )  
Core net income $ 19,588   $ 18,157   $ 18,502   $ 19,803   $ 19,073    
             
Profitability:            
Core Diluted Earnings Per Share $ 0.44   $ 0.41   $ 0.42   $ 0.45   $ 0.43    
Diluted Earnings Per Share $ 0.43   $ 0.41   $ 0.42   $ 0.25   $ 0.62    
Weighted Average Diluted             
  Common Shares Outstanding   44,530,123     44,641,913     44,535,274     44,405,357     44,363,787    
Core Return on Average Assets (2)   0.99 %   0.94 %   0.94 %   1.01 %   0.99 %  
Return on Average Assets (2)   0.97 %   0.94 %   0.94 %   0.55 %   1.43 %  
Core Return on Average Equity (2)   8.95 %   8.45 %   8.45 %   9.19 %   9.06 %  
Return on Average Equity (2)   8.81 %   8.46 %   8.46 %   5.06 %   13.12 %  
Core Return on Average Tangible Common Equity (2)(4)   13.67 %   13.07 %   13.08 %   14.35 %   14.27 %  
Return on Average Tangible Common Equity (2)(4)   13.47 %   13.08 %   13.09 %   8.15 %   20.43 %  
Net Interest Margin (2)(3)   3.51 %   3.60 %   3.61 %   3.61 %   3.60 %  
             
Six Months Ended June 30,            
           
Reconciliation of Non-GAAP Financial Measures:   2015     2014    
Reported net income (GAAP) $ 37,447   $ 45,649    
Adj: Gain on sale of securities, net (net of tax)     (26 )     (14 )  
Adj: Other adjustments (net of tax) (6)      324       115    
Adj: Gain on sale of Springstone (net of tax and related incentive compensation)     -        (11,168 )        
Adj: Prepayment penalties related to debt restructuring (net of tax)     -        2,925          
Total Adjustments     298       (8,142 )  
Core net income $ 37,745   $ 37,507    
       
Profitability:      
Core Diluted Earnings Per Share $ 0.85   $ 0.85    
Diluted Earnings Per Share $ 0.84   $ 1.03    
Weighted Average Diluted             
  Common Shares Outstanding   44,589,358     44,328,854    
Core Return on Average Assets (2)   0.97 %   0.98 %  
Return on Average Assets (2)   0.96 %   1.20 %  
Core Return on Average Equity (2)   8.70 %   9.04 %  
Return on Average Equity (2)   8.63 %   11.00 %  
Core Return on Average Tangible Common Equity (2)(5)   13.38 %   14.38 %  
Return on Average Tangible Common Equity (2)(5)   13.28 %   17.37 %  
Net Interest Margin (2)(3)   3.55 %   3.62 %  
             
(1) Primarily net gain on settlement of litigation and reorganization expenses for 2014 and reorganization expenses in 2015.       
(2)  Annualized            
(3)  Calculated on a Fully Tax Equivalent (“FTE”) basis            
(4)  Excludes amortization of intangible assets (net of tax) from net income and average tangible common equity is calculated as follows:    
             
             
    2015     2014    
  2nd Q 1st Q 4th Q 3rd Q 2nd Q  
Average stockholders' equity $   878,164   $   871,074   $   868,634   $   855,164   $   844,707    
Less: average goodwill and other intangibles     282,272       283,508       284,743       285,993       287,366    
Average tangible common equity $   595,892   $   587,566   $   583,891   $   569,171   $   557,341    
             
(5)  Excludes amortization of intangible assets (net of tax) from net income and average tangible common equity is calculated as follows:    
             
  6 Months ended June 30,        
    2015     2014          
Average stockholders' equity $   874,639   $   836,692          
Less: average goodwill and other intangibles     282,887       288,685          
Average tangible common equity $   591,752   $   548,007        
             
(6)  Primarily net gain on settlement of litigation and reorganization expenses for 2014 and reorganization expenses for 2015.      
             
Note:  Year-to-date (YTD) EPS may not equal sum of quarters due to share count differences.        

 

NBT Bancorp Inc. and Subsidiaries            
SELECTED FINANCIAL DATA            
(unaudited, dollars in thousands except per share data)            
             
             
    2015     2014    
  2nd Q 1st Q 4th Q 3rd Q 2nd Q  
Balance Sheet Data:            
Securities Available for Sale $ 1,129,249   $ 1,071,654   $ 1,013,171   $ 1,044,502   $ 1,378,799    
Securities Held to Maturity     454,312       456,773       454,361       459,620       125,965    
Net Loans     5,705,929       5,557,664       5,528,912       5,517,757       5,504,954    
Total Assets     8,072,485       7,863,861       7,797,926       7,867,031       7,869,512    
Total Deposits     6,371,479       6,479,437       6,299,605       6,314,939       6,042,588    
Total Borrowings     743,893       425,143       548,943       607,889       886,799    
Total Liabilities     7,196,514       6,986,367       6,933,745       7,009,591       7,012,371    
Stockholders' Equity     875,971       877,494       864,181       857,440       857,141    
             
Asset Quality:            
Nonaccrual Loans $ 42,286   $ 45,053   $ 41,074   $ 50,531   $ 51,234    
90 Days Past Due and Still Accruing     1,994       2,601       4,941       4,022       2,186    
Total Nonperforming Loans     44,280       47,654       46,015       54,553       53,420    
Other Real Estate Owned     4,649       4,387       3,964       1,497       1,953    
Total Nonperforming Assets     48,929       52,041       49,979       56,050       55,373    
Allowance for Loan Losses     64,959       65,359       66,359       69,334       69,534    
             
Asset Quality Ratios (Total):            
Allowance for Loan Losses to Total Loans   1.13 %   1.16 %   1.19 %   1.24 %   1.25 %  
Total Nonperforming Loans to Total Loans   0.77 %   0.85 %   0.82 %   0.98 %   0.96 %  
Total Nonperforming Assets to Total Assets   0.61 %   0.66 %   0.64 %   0.71 %   0.70 %  
Allowance for Loan Losses to Total Nonperforming Loans   146.70 %   137.15 %   144.21 %   127.09 %   130.16 %  
Past Due Loans to Total Loans   0.61 %   0.54 %   0.69 %   0.65 %   0.57 %  
Net Charge-Offs to Average Loans (3)   0.30 %   0.34 %   0.70 %   0.36 %   0.30 %  
             
Asset Quality Ratios (Originated) (1):            
Allowance for Loan Losses to Loans   1.24 %   1.29 %   1.36 %   1.38 %   1.44 %  
Nonperforming Loans to Loans   0.59 %   0.69 %   0.72 %   0.83 %   0.81 %  
Allowance for Loan Losses to Nonperforming Loans   208.99 %   188.68 %   187.88 %   166.69 %   177.01 %  
Past Due Loans to Loans   0.64 %   0.56 %   0.73 %   0.70 %   0.59 %  
             
Capital:            
Equity to Assets   10.85 %   11.16 %   11.08 %   10.90 %   10.89 %  
Book Value Per Share $ 20.05   $ 19.95   $ 19.69   $ 19.62   $ 19.61    
Tangible Book Value Per Share (2) $ 13.61   $ 13.52   $ 13.22   $ 13.09   $ 13.06    
Tier 1 Leverage Ratio   9.57 %   9.72 %   9.39 %   9.20 %   9.23 %  
Common Equity Tier 1 Capital Ratio   10.22 %   10.46 % N/A N/A N/A  
Tier 1 Capital Ratio   11.78 %   12.05 %   12.32 %   11.94 %   11.87 %  
Total Risk-Based Capital Ratio   12.84 %   13.15 %   13.50 %   13.16 %   13.09 %  
Common Stock Price (End of Period) $ 26.17   $ 25.06   $ 26.27   $ 22.52   $ 24.02    
             
(1)  Excludes acquired loans            
(2)  Stockholders' equity less goodwill and intangible assets divided by common shares outstanding      
(3)  Annualized            
             

 

NBT Bancorp Inc. and Subsidiaries       
CONSOLIDATED BALANCE SHEETS      
(unaudited, dollars in thousands)      
       
  June 30, December 31,  
ASSETS   2015     2014    
Cash and due from banks $    127,676   $   139,635    
Short term interest bearing accounts     6,535       7,001    
Securities available for sale, at fair value      1,129,249       1,013,171    
Securities held to maturity (fair value of $454,255 and $454,994 at     454,312       454,361    
  June 30, 2015 and December 31, 2014, respectively)      
Trading securities     8,468       7,793    
Federal Reserve and Federal Home Loan Bank stock     38,659       32,626    
Loans     5,770,888       5,595,271    
Less allowance for loan losses     64,959       66,359    
  Net loans    5,705,929     5,528,912    
Premises and equipment, net     87,652       89,258    
Goodwill     263,634       263,634    
Intangible assets, net     17,897       20,317    
Bank owned life insurance     115,241       114,251    
Other assets     117,233       126,967    
TOTAL ASSETS $    8,072,485   $    7,797,926    
       
LIABILITIES AND STOCKHOLDERS' EQUITY      
Deposits:      
 Demand (noninterest bearing) $    1,840,012   $   1,838,622    
 Savings, NOW, and money market     3,583,313       3,417,160    
 Time     948,154       1,043,823    
  Total deposits   6,371,479     6,299,605    
Short-term borrowings     511,992       316,802    
Long-term debt     130,705       130,945    
Junior subordinated debt     101,196       101,196    
Other liabilities     81,142       85,197    
  Total liabilities   7,196,514     6,933,745    
       
Total stockholders' equity     875,971       864,181    
       
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $    8,072,485   $    7,797,926    
       

 

NBT Bancorp Inc. and Subsidiaries             
CONSOLIDATED STATEMENTS OF INCOME            
(unaudited, dollars in thousands except per share data)          
             
  Three Months Ended   Six Months Ended  
  June 30,   June 30,  
    2015     2014       2015     2014    
Interest, fee and dividend income:            
Loans $    59,873   $   60,559     $    119,391   $   120,574    
Securities available for sale   5,144       6,612         10,089       13,369    
Securities held to maturity   2,315       783         4,598       1,551    
Other   395       502         875       1,039    
  Total interest, fee and dividend income     67,727       68,456         134,953       136,533    
Interest expense:            
Deposits   3,517       3,000         7,090       6,284    
Short-term borrowings   144       209         265       440    
Long-term debt   836       2,135         1,662       4,642    
Junior subordinated debt   545       538         1,085       1,076    
  Total interest expense     5,042       5,882         10,102       12,442    
Net interest income     62,685       62,574         124,851       124,091    
Provision for loan losses   3,898       4,166         7,540       7,762    
  Net interest income after provision for loan losses     58,787       58,408         117,311       116,329    
Noninterest income:            
Insurance and other financial services revenue   5,836       5,594         12,210       12,331    
Service charges on deposit accounts   4,285       4,397         8,357       8,766    
ATM and debit card fees   4,679       4,357         8,927       8,429    
Retirement plan administration fees   3,566       2,977         6,762       5,895    
Trust   5,196       4,953         9,646       9,399    
Bank owned life insurance income   928       978         2,487       2,360    
Net securities gains   26       14         40       21    
Gain on the sale of Springstone investment     -        19,401         -        19,401    
Other   3,699       3,356         6,320       5,702    
  Total noninterest income     28,215       46,027         54,749       72,304    
Noninterest expense:            
Salaries and employee benefits   30,831       31,142         61,013       60,676    
Occupancy   5,412       5,435         11,478       11,661    
Data processing and communications   4,288       4,015         8,391       8,016    
Professional fees and outside services   3,395       3,752         6,892       7,167    
Equipment   3,316       3,132         6,565       6,248    
Office supplies and postage   1,627       1,803         3,246       3,488    
FDIC expenses     1,280       1,229         2,478       2,507    
Advertising    734       726         1,453       1,465    
Amortization of intangible assets   1,187       1,236         2,471       2,546    
Loan collection and other real estate owned   22       801         894       1,841    
Prepayment penalties on long-term debt     -        4,554         -        4,554    
Other operating   5,872       4,911         10,785       10,084    
  Total noninterest expense   57,964     62,736       115,666     120,253    
Income before income taxes   29,038     41,699       56,394     68,380    
Income taxes   9,757       14,059         18,947       22,731    
  Net income $    19,281   $   27,640     $    37,447   $   45,649    
Earnings Per Share:            
  Basic $    0.44   $   0.63     $    0.85   $   1.04    
  Diluted $    0.43   $   0.62     $    0.84   $   1.03    
             

 

NBT Bancorp Inc. and Subsidiaries            
QUARTERLY CONSOLIDATED STATEMENTS OF INCOME            
(unaudited, dollars in thousands except per share data)            
             
    2015     2014    
  2nd Q 1st Q 4th Q 3rd Q 2nd Q  
Interest, fee and dividend income:            
Loans $   59,873   $   59,518   $   61,577   $   61,173   $   60,559    
Securities available for sale   5,144     4,945     5,000     6,095     6,612    
Securities held to maturity   2,315     2,283     2,357     1,353     783    
Other   395     480     480     513     502    
  Total interest, fee and dividend income   67,727     67,226     69,414     69,134     68,456    
Interest expense:            
Deposits   3,517     3,573     3,856     3,498     3,000    
Short-term borrowings   144     121     143     262     209    
Long-term debt   836     826     846     1,067     2,135    
Junior subordinated debt   545     540     545     544     538    
  Total interest expense   5,042     5,060     5,390     5,371     5,882    
Net interest income   62,685     62,166     64,024     63,763     62,574    
Provision for loan losses   3,898     3,642     6,892     4,885     4,166    
  Net interest income after provision for loan losses   58,787     58,524     57,132     58,878     58,408    
Noninterest income:            
Insurance and other financial services revenue   5,836     6,374     6,007     6,179     5,594    
Service charges on deposit accounts   4,285     4,072     4,656     4,519     4,397    
ATM and debit card fees   4,679     4,248     4,266     4,440     4,357    
Retirement plan administration fees   3,566     3,196     2,962     3,272     2,977    
Trust    5,196     4,450     4,793     4,758     4,953    
Bank owned life insurance income   928     1,559     1,894     1,095     978    
Net securities gains   26     14     33     38     14    
Gain on the sale of Springstone investment     -        -        -        -      19,401    
Other   3,699     2,621     2,435     2,376     3,356    
  Total noninterest income   28,215     26,534     27,046     26,677     46,027    
Noninterest expense:            
Salaries and employee benefits   30,831     30,182     30,058     28,933     31,142    
Occupancy   5,412     6,066     5,256     5,211     5,435    
Data processing and communications   4,288     4,103     4,092     4,029     4,015    
Professional fees and outside services   3,395     3,497     3,564     3,695     3,752    
Equipment   3,316     3,249     3,211     3,199     3,132    
Office supplies and postage   1,627     1,619     1,762     1,733     1,803    
FDIC expenses   1,280     1,198     1,302     1,135     1,229    
Advertising   734     719     963     403     726    
Amortization of intangible assets   1,187     1,284     1,226     1,275     1,236    
Loan collection and other real estate owned   22     872     702     705     801    
Prepayment penalties on long-term debt     -        -        -        13,348       4,554    
Other operating   5,872     4,913     4,607     5,401     4,911    
  Total noninterest expense   57,964     57,702     56,743     69,067     62,736    
Income before income taxes   29,038     27,356     27,435     16,488     41,699    
Income taxes   9,757     9,190     8,922     5,576     14,059    
  Net income  $   19,281   $   18,166   $   18,513   $   10,912   $   27,640    
Earnings per share:            
  Basic $   0.44   $   0.41   $   0.42   $   0.25   $   0.63    
  Diluted $   0.43   $   0.41   $   0.42   $   0.25   $   0.62    
             
Note:  Year-to-date (YTD) EPS may not equal sum of quarters due to share count differences.      

 

NBT Bancorp Inc. and Subsidiaries                    
AVERAGE QUARTERLY BALANCE SHEETS                  
(unaudited, dollars in thousands)                    
  Average
Balance
Yield /
Rates
Average
Balance
Yield /
Rates
Average
Balance
Yield /
Rates
Average
Balance
Yield /
Rates
Average
Balance
Yield /
Rates
  Q2 - 2015 Q1 - 2015 Q4 - 2014 Q3 - 2014 Q2 - 2014
ASSETS:                    
Short-term interest bearing accounts $    9,854     0.36 % $   9,156     0.30 % $   5,895     0.51 % $   4,791     0.54 % $   3,915     0.76 %
Securities available for sale (1)(2)     1,067,619     1.98 %     1,018,880     2.02 %     1,018,505     2.00 %     1,263,375     2.01 %     1,376,314     2.05 %
Securities held to maturity (1)      452,948     2.49 %     454,957     2.47 %     458,038     2.45 %     234,403     2.84 %     121,042     3.43 %
Investment in FRB and FHLB Banks     31,564     4.90 %     30,931     6.20 %     31,274     6.01 %     39,459     5.06 %     42,965     4.63 %
Loans (3)     5,688,159     4.24 %     5,586,942     4.33 %     5,603,268     4.37 %     5,563,206     4.38 %     5,517,315     4.42 %
 Total interest earning assets $   7,250,144     3.79 % $   7,100,866     3.89 % $   7,116,980     3.92 % $   7,105,234     3.91 % $   7,061,551     3.94 %
Other assets     685,523         696,091         709,955         697,814         680,059    
Total assets $   7,935,667     $   7,796,957     $   7,826,935     $   7,803,048     $   7,741,610    
                     
LIABILITIES AND STOCKHOLDERS' EQUITY:                    
Money market deposit accounts $ 1,598,898     0.20 % $ 1,544,488     0.21 % $ 1,524,881     0.20 % $ 1,452,287     0.19 % $ 1,441,284     0.15 %
NOW deposit accounts     974,504     0.05 %     972,263     0.05 %     978,527     0.05 %     927,026     0.05 %     960,698     0.06 %
Savings deposits     1,080,954     0.06 %     1,040,031     0.06 %     1,017,300     0.08 %     1,025,795     0.07 %     1,040,528     0.07 %
Time deposits     968,714     1.00 %     1,014,904     1.00 %     1,058,615     1.03 %     1,032,370     0.96 %     971,595     0.88 %
  Total interest bearing deposits $   4,623,070     0.31 % $   4,571,686     0.32 % $   4,579,323     0.33 % $   4,437,478     0.31 % $   4,414,105     0.27 %
Short-term borrowings     302,693     0.19 %     265,420     0.19 %     299,981     0.19 %     447,761     0.23 %     383,480     0.22 %
Junior subordinated debentures     101,196     2.16 %     101,196     2.16 %     101,196     2.13 %     101,196     2.13 %     101,196     2.13 %
Long-term debt     130,743     2.56 %     130,879     2.56 %     131,000     2.56 %     170,223     2.49 %     290,791     2.95 %
  Total interest bearing liabilities $   5,157,702     0.39 % $   5,069,181     0.40 % $   5,111,500     0.42 % $   5,156,658     0.41 % $   5,189,572     0.45 %
Demand deposits     1,815,705         1,770,703         1,759,482         1,708,632         1,620,488    
Other liabilities     84,096         85,999         87,319         82,594         86,843    
Stockholders' equity     878,164         871,074         868,634         855,164         844,707    
Total liabilities and stockholders' equity $   7,935,667     $   7,796,957     $   7,826,935     $   7,803,048     $   7,741,610    
                     
Interest rate spread     3.40 %     3.49 %     3.50 %     3.50 %     3.49 %
Net interest margin     3.51 %     3.60 %     3.61 %     3.61 %     3.60 %
                     
(1) Securities are shown at average amortized cost                    
(2) Excluding unrealized gains or losses                    
(3) For purposes of these computations, nonaccrual loans are included in the average loan balances outstanding          
                     

 

NBT Bancorp Inc. and Subsidiaries            
AVERAGE YEAR-TO-DATE BALANCE SHEETS          
(unaudited, dollars in thousands)            
  Average   Yield/ Average   Yield/
  Balance Interest Rates  Balance Interest Rates 
  Six Months ended June 30,    2015     2014  
ASSETS:            
Short-term interest bearing accounts $ 9,507   $ 16     0.33 % $ 3,328   $ 14     0.87 %
Securities available for sale (1)(2)     1,043,385       10,349     2.00 %     1,379,014       14,212     2.08 %
Securities held to maturity (1)      453,947       5,580     2.48 %     118,840       2,048     3.48 %
Investment in FRB and FHLB Banks     31,250       859     5.54 %     43,279       1,028     4.79 %
Loans (3)     5,637,829       119,770     4.28 %     5,471,879       121,002     4.46 %
 Total interest earning assets $    7,175,918   $    136,574     3.84 % $   7,016,340   $   138,304     3.98 %
Other assets     690,777           679,654      
Total assets $    7,866,695       $   7,695,994      
             
LIABILITIES AND STOCKHOLDERS' EQUITY:            
Money market deposit accounts $ 1,571,843       1,603     0.21 % $ 1,426,446       1,066     0.15 %
NOW deposit accounts     973,390       249     0.05 %     946,691       256     0.05 %
Savings deposits     1,060,606       324     0.06 %     1,020,391       369     0.07 %
Time deposits     991,681       4,914     1.00 %     985,510       4,593     0.94 %
  Total interest bearing deposits $    4,597,520   $    7,090     0.31 % $   4,379,038   $   6,284     0.29 %
Short-term borrowings     284,160       265     0.19 %     391,173       440     0.23 %
Trust preferred debentures     101,196       1,085     2.16 %     101,196       1,076     2.14 %
Long-term debt     130,811       1,662     2.56 %     299,726       4,642     3.12 %
  Total interest bearing liabilities $    5,113,687   $    10,102     0.40 % $   5,171,133   $   12,442     0.49 %
Demand deposits     1,793,328           1,605,261      
Other liabilities     85,041           82,908      
Stockholders' equity     874,639           836,692      
Total liabilities and stockholders' equity $    7,866,695       $   7,695,994      
  Net interest income (FTE)       126,472           125,862    
Interest rate spread       3.44 %       3.49 %
Net interest margin       3.55 %       3.62 %
Taxable equivalent adjustment        1,621           1,771    
Net interest income   $    124,851       $   124,091    
             
(1) Securities are shown at average amortized cost            
(2) Excluding unrealized gains or losses            
(3) For purposes of these computations, nonaccrual loans are included in the average loan balances outstanding    

 

NBT Bancorp Inc. and Subsidiaries          
CONSOLIDATED LOAN BALANCES          
(unaudited, dollars in thousands)          
           
           
    2015     2014  
  2nd Q 1st Q 4th Q 3rd Q 2nd Q
Residential real estate mortgages $   1,154,416   $   1,125,886   $   1,115,715   $   1,099,912   $   1,073,100  
Commercial     1,147,586       1,140,114       1,144,761       1,179,616       1,203,882  
Commercial real estate     1,423,489       1,349,940       1,334,984       1,284,775       1,279,070  
Consumer     1,495,160       1,452,070       1,430,216       1,441,629       1,429,022  
Home equity     550,237       555,013       569,595       581,159       589,414  
 Total loans $   5,770,888   $   5,623,023   $   5,595,271   $   5,587,091   $   5,574,488  
         

 


 

Contact:
Martin A. Dietrich, CEO
Michael J. Chewens, CFO
NBT Bancorp Inc.52 South Broad StreetNorwich, NY 13815
607-337-6119

NBT Bancorp Inc.
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