UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549


FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 26, 2021



NBT BANCORP INC.
(Exact name of registrant as specified in its charter)

Delaware
000-14703
16-1268674
(State or other jurisdiction of incorporation or organization)
(Commission File Number)
(I.R.S. Employer Identification No.)

52 South Broad Street, Norwich, New York 13815
(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (607) 337-2265

Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:


Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of class
Trading Symbol
Name of exchange on which registered
Common Stock, par value $0.01 per share
NBTB
The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐



Item 2.02
Results of Operations and Financial Condition

On July 26, 2021, NBT Bancorp Inc. issued a press release describing its results of operations for the quarter ended June 30, 2021. That press release is furnished as Exhibit 99.1 hereto. A conference call will be held at 8:30 a.m. Eastern Time on Tuesday, July 27, 2021, to review the second quarter 2021 financial results. The audio webcast link, along with the corresponding presentation slides, will be available on the Event Calendar page of the Company’s website at www.nbtbancorp.com.
 
Item 9.01
Financial Statements and Exhibits.
 
(a)
Not applicable.
 
(b)
Not applicable.
 
(c)
Not applicable.
 
(d)
Exhibits.
 
Exhibit No.
 
Description

Press release of NBT Bancorp Inc. dated July 26, 2021
   
104
Cover Page Interactive Data File (embedded within the Inline XBRL document)


SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
NBT BANCORP INC.
     
Date: July 26, 2021
By:
/s/ Scott A. Kinglsey
   
Scott A. Kingsley
   
Executive Vice President
   
and Chief Financial Officer




Exhibit 99.1

1

FOR IMMEDIATE RELEASE
ATTENTION: FINANCIAL AND BUSINESS EDITORS

Contact:
John H. Watt, Jr., President and CEO
 
Scott A. Kingsley, Executive Vice President and CFO
 
NBT Bancorp Inc.
 
52 South Broad Street
 
Norwich, NY 13815
 
607-337-6589

NBT BANCORP INC. ANNOUNCES SECOND QUARTER NET INCOME OF $40.3 MILLION ($0.92 PER DILUTED COMMON SHARE); APPROVES A 3.7% DIVIDEND INCREASE

NORWICH, NY (July 26, 2021) – NBT Bancorp Inc. (“NBT” or the “Company”) (NASDAQ: NBTB) reported net income and diluted earnings per share for the three and six months ended June 30, 2021.
 
Net income for the three months ended June 30, 2021 was $40.3 million, or $0.92 per diluted common share. Net income increased $15.6 million from the second quarter of 2020 primarily due to the estimated impact of the COVID-19 pandemic on expected credit losses in 2020, which resulted in a second quarter 2020 provision for loan losses of $18.8 million. Net income increased $0.5 million from the previous quarter primarily due to lower provision for loan losses and higher noninterest income, partly offset by higher noninterest expense.

Pre-provision net revenue (“PPNR”)1 for the second quarter of 2021 was $49.0 million compared to $47.5 million in the previous quarter and $50.7 million in the second quarter of 2020.
 
CEO Comments

“Through the first half of 2021 momentum at NBT has continued to build,” said NBT President and CEO John H. Watt, Jr. “Our team has driven growth with increases in total loans and pivoted quickly from supporting our customers and communities through the worst of the pandemic and the reopening of our markets to full-on execution of our strategic growth plans. We continue to prioritize our disciplined approach to the allocation of capital, including the advancement of our New England expansion with our first full-service locations in Connecticut opening in the second quarter. Our continued strong capital generation and our commitment to enhancing long-term shareholder value resulted in our decision to increase our quarterly dividend to $0.28 per share, a 3.7% increase.”


2
Second Quarter Financial Highlights

Net Income
Net income of $40.3 million
 Diluted earnings per share of $0.92
Net Interest
Income / NIM
Net interest income on a fully taxable equivalent basis was $79.5 million1
Net interest margin (“NIM”) on a fully taxable equivalent basis was 3.00%1, down 17 basis points (“bps”) from the prior quarter
PPNR
PPNR1 was $49.0 million compared to $47.5 million in the first quarter of 2021 and $50.7 million in the second quarter of 2020
Loans and Credit
Quality
Period end loans were $7.5 billion, up 1%, annualized, from December 31, 2020
Excluding $360 million of Paycheck Protection Program (“PPP”) loans at June 30, 2021, period end loans increased $61 million or 0.9% from March 31, 2021
Allowance for loan losses to total loans of 1.31% (1.38% excluding PPP loans and related allowance), down 7 bps from the first quarter 2021 (down 10 bps excluding PPP loans and related allowance)
Net charge-offs to average loans was 0.07%, annualized (0.07% excluding PPP loans)
Nonperforming assets to total assets was 0.38% (0.39% excluding PPP loans)
Capital
Tangible book value per share2 grew 4% for the quarter and 10% from prior year to $21.50 at June 30, 2021
Tangible equity to assets of 8.28%1
CET1 ratio of 12.12%; Leverage ratio of 9.40%

Loans


Period end total loans were $7.5 billion at June 30, 2021 and at December 31, 2020.

Excluding PPP loans, period end loans increased $60.9 million from March 31, 2021. Commercial and industrial loans increased $12.4 million to $1.5 billion; commercial real estate loans increased $23.5 million to $2.3 billion; and total consumer loans increased $25.0 million to $3.4 billion.

Total PPP loans as of June 30, 2021 were $360 million (net of unamortized fees). The following activity occurred during the second quarter of 2021:

o
$37 million in originations

o
$232.3 million of loans forgiven

o
$4.7 million of interest and fees recognized into interest income

Commercial line of credit utilization rate was 22% at June 30, 2021 consistent with 22% at March 31, 2021 and compared to 26% at June 30, 2020.

Deposits


Average total deposits in the second quarter of 2021 were $9.9 billion, compared to $9.3 billion in the first quarter of 2021, driven by increases in non-interest bearing demand deposit accounts, money market deposit accounts and savings deposit accounts.

Loan to deposit ratio was 76.8% at June 30, 2021, compared to 82.6% at December 31, 2020.


3
Net Interest Income and Net Interest Margin
 

Net interest income for the second quarter of 2021 was $79.2 million, which was consistent with the first quarter of 2021 and down $1.3 million or 1.6% from the second quarter of 2020.

The NIM on a fully taxable equivalent (“FTE”) basis for the second quarter of 2021 was 3.00%, down 17 bps from the first quarter of 2021 and down 38 bps from the second quarter of 2020. The net impact of PPP loans and excess liquidity negatively impacted the NIM by 24 bps in the second quarter of 2021 compared to a negative 8 bps impact in the first quarter 2021. Excluding the impact of PPP lending and excess liquidity from each quarter, the NIM decreased 1 bp from the prior quarter primarily due to a 4 bp decline in earning asset yields partially offset by a 3 bp decline in the cost of interest bearing liabilities and a $223 million increase in average checking deposit account balances during the quarter.

Earning asset yields for the three months ended June 30, 2021 were down 20 bps from the prior quarter and down 50 bps from the same quarter in the prior year. Earning assets grew $490.0 million or 4.8% from the prior quarter and grew $1.0 billion or 10.7% from the same quarter in the prior year. The following are highlights from the prior quarter:

o
Excess liquidity resulted in a $386.7 million increase in the average balances of short-term interest bearing accounts with a yield of 0.09%.

o
The average balance of investment securities increased $103.9 million while yields declined 13 bps.

o
Loan yields decreased 6 bps to 3.96% for the quarter. Excluding PPP loans, yields decreased 1 bp from the prior quarter.

Total cost of deposits was 0.12% for the second quarter of 2021, down 2 bps from the prior quarter and down 11 bps from the same period in the prior year.

The cost of interest-bearing liabilities for the three months ended June 30, 2021 was 0.29%, down 5 bps compared to the prior quarter of 0.34% and down 16 bps from the second quarter of 2020 of 0.45%.

o
Cost of interest-bearing deposits decreased 3 bps from the prior quarter and decreased 16 bps from the same quarter in 2020.

Credit Quality and Allowance for Credit Losses


Net charge-offs to total average loans of 7 bps (7 bps excluding PPP loans) compared to 12 bps (13 bps excluding PPP loans) in the prior quarter and 28 bps (30 bps excluding PPP loans) in the second quarter of 2020. The decrease in charge-offs during the second quarter of 2021 was primarily due to lower charge-offs in the consumer loan portfolios, which continue to be at lower levels due to the support of government pandemic relief programs.

Nonperforming assets to total assets was 0.38% (0.39% excluding PPP loans) compared to 0.41% (0.43% excluding PPP loans) at March 31, 2021 and 0.27% (0.28% excluding PPP loans) at June 30, 2020.

Provision expense for the three months ended June 30, 2021 was a net benefit of $5.2 million and net charge-offs were $1.3 million. The net provision benefit was $2.4 million more than the first quarter of 2021 compared to provision expense of $18.8  million in the second quarter of 2020. The decrease in provision expense from the prior quarter and second quarter of 2020 was primarily due to the reduction in the level of allowance for loan losses resulting from an improved economic forecast and lower levels of charge-offs.


4

The allowance for loan losses was $98.5 million or 1.31% (1.38% excluding PPP loans and related allowance) of total loans compared to 1.38% (1.48% excluding PPP loans and related allowance) at March 31, 2021 and 1.49% (1.59% excluding PPP loans and related allowance) at June 30, 2020. The decrease in the level of allowance for credit losses was primarily due to the positive impact the forecasted improving economic conditions had on expected credit losses.

The reserve for unfunded loan commitments decreased to $5.8 million at June 30, 2021 compared to the prior quarter at $5.9 million.

Noninterest Income
 

Total noninterest income, excluding securities gains (losses), was $39.1 million for the three months ended June 30, 2021, up $2.5 million from the prior quarter and up $4.3 million from the prior year quarter.

Service charges on deposit accounts were comparable to the prior quarter and higher than the second quarter of 2020.

ATM and debit card fees were up compared to the prior quarter and the second quarter of 2020 due to increased volume and higher per transaction rates.

Retirement plan administration fees were lower than the prior quarter driven by seasonal revenue fluctuations, and higher than the second quarter of 2020 driven by market performance and organic growth in relationships.

Wealth management fees was higher than both the prior quarter and second quarter of 2020 driven by market performance and organic growth.

Other noninterest income increased slightly from the prior quarter and decreased from the second quarter of 2020 due to lower loan swap fee income and lower mortgage banking income.

Noninterest Expense


Total noninterest expense for the second quarter of 2021 was up 5.2% from the previous quarter and up 9.3% from the second quarter of 2020.

Salaries and benefits increased from the prior quarter and the second quarter of 2020 due to one additional day of payroll in the second quarter, annual merit pay increases and higher medical expenses, partially offset by lower stock-based compensation.

Occupancy expense is down from the prior quarter due to lower seasonal maintenance and utility expenses and comparable to the second quarter of 2020.

Data processing and communications decreased from the prior quarter and were higher compared to the second quarter of 2020 driven by continued investments in digital platform solutions including a technology-enabled PPP platform.

Professional fees and outside services increased from the prior quarter due to timing of initiatives, and were higher compared to the second quarter of 2020 as a result of certain projects paused during the COVID-19 pandemic.

Equipment expense was higher than both the prior quarter and the second quarter of 2020 due to higher technology costs associated with several digital upgrades.

Other expenses increased from the prior quarter and the second quarter of 2020 and included $1.9 million in non-recurring costs, including an estimated legal settlement charge.
 

5
Income Taxes


The effective tax rate was 22.9% for the second quarter of 2021 compared to 21.9% for the first quarter of 2021 and 21.0% for the second quarter of 2020. The increase was due to a higher level of taxable income relative to total income.

Capital


Capital ratios remain strong with tangible common equity to tangible assets1 at 8.28%. Tangible book value per share2 grew 4% from the prior quarter and 10% from the prior year quarter to $21.50.

June 30, 2021 CET1 capital ratio of 12.12%, leverage ratio of 9.40 % and total risk-based capital ratio of 15.78%.

Dividend and Stock Repurchase


The Board of Directors approved a third-quarter cash dividend of $0.28 per share at a meeting held today. The dividend, which represents a $0.01, or 3.7% increase, will be paid on September 15, 2021 to shareholders of record as of September 1, 2021. The increased dividend represents a yield of 3.3% based upon the closing price of the Company’s stock on July 21, 2021.

The Company purchased 23,627 shares of common stock during the second quarter of 2021 at a weighted average price of $36.03 excluding commissions. As of June 30, 2021, there were 1,719,342 shares available for repurchase under this plan, which expires on December 31, 2021.

Conference Call and Webcast

The Company will host a conference call at 8:30 a.m. (Eastern) Tuesday, July 27, 2021, to review second quarter 2021 financial results. The audio webcast link, along with the corresponding presentation slides, will be available on the Company’s Event Calendar page at https://stockholderinfo.nbtbancorp.com/events-calendar/upcoming-events and will be archived for twelve months.

Corporate Overview

NBT Bancorp Inc. is a financial holding company headquartered in Norwich, NY, with total assets of $11.6 billion at June 30, 2021. 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 140 banking locations in New York, Pennsylvania, Vermont, Massachusetts, New Hampshire, Maine and Connecticut. EPIC Retirement Plan Services, based in Rochester, NY, is a full-service retirement plan administration and recordkeeping firm. NBT Insurance Agency, LLC, based in Norwich, NY, is a full-service insurance agency. More information about NBT and its divisions is available online at: www.nbtbancorp.com, www.nbtbank.com, www.epicrps.com and www.nbtinsurance.com.


6
Forward-Looking Statements
 
This news release contains forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. These statements may be identified by the use of phrases such as “anticipate,” “believe,” “expect,” “forecasts,” “projects,” “will,” “can,” “would,” “should,” “could,” “may,” or other similar terms. There are a number of factors, many of which are beyond the Company’s control that could cause actual results to differ materially from those contemplated by 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) local, regional, national and international economic conditions and the impact they may have on the Company and its customers and the Company’s assessment of that impact; (2) changes in the level of nonperforming assets and charge-offs; (3) changes in estimates of future reserve requirements based upon the periodic review thereof under relevant regulatory and accounting requirements; (4) the effects of and changes in trade and monetary and fiscal policies and laws, including the interest rate policies of the Federal Reserve Board (“FRB”); (5) inflation, interest rate, securities market and monetary fluctuations; (6) political instability; (7) acts of war or terrorism; (8) the timely development and acceptance of new products and services and perceived overall value of these products and services by users; (9) changes in consumer spending, borrowings and savings habits; (10) changes in the financial performance and/or condition of the Company’s borrowers; (11) technological changes; (12) acquisitions and integration of acquired businesses; (13) the ability to increase market share and control expenses; (14) changes in the competitive environment among financial holding companies; (15) the effect of changes in laws and regulations (including laws and regulations concerning taxes, banking, securities and insurance) with which the Company and its subsidiaries must comply, including those under the Dodd-Frank Act, Economic Growth, Regulatory Relief, Consumer Protection Act of 2018, Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), and other legislative and regulatory responses to the coronavirus (“COVID-19”) pandemic; (16) the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board (“FASB”) and other accounting standard setters; (17) changes in the Company’s organization, compensation and benefit plans; (18) the costs and effects of legal and regulatory developments including the resolution of legal proceedings or regulatory or other governmental inquiries and the results of regulatory examinations or reviews; (19) greater than expected costs or difficulties related to the integration of new products and lines of business; (20) the adverse impact on the U.S. economy, including the markets in which we operate, of the novel coronavirus, which causes COVID-19 global pandemic; and (21) the Company’s success at managing the risks involved in the foregoing items.


7
Currently, one of the most significant factors that could cause actual outcomes to differ materially from the Company’s forward-looking statements is the potential adverse effect of the current COVID-19 pandemic on the financial condition, results of operations, cash flows and performance of the Company, its customers and the global economy and financial markets. The extent to which the COVID-19 pandemic impacts the Company will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic and its impact on the Company’s customers and demand for financial services, the actions governments, businesses and individuals take in response to the pandemic, the impact of the COVID-19 pandemic and actions taken in response to the pandemic on global and regional economies, national and local economic activity, and the pace of recovery when the COVID-19 pandemic subsides, among others. Moreover, investors are cautioned to interpret many of the risks identified under the section entitled “Risk Factors” in our Form 10-K for the year ended December 31, 2020 as being heightened as a result of the ongoing and numerous adverse impacts of the COVID-19 pandemic. The Company cautions readers not place undue reliance on any forward-looking statements, which speak only as of the date made, and advises readers that various factors including, but not limited to, those described above and other factors discussed in the Company’s annual and quarterly reports previously filed with the SEC, could affect the Company’s financial performance and could cause the Company’s actual results or circumstances for future periods to differ materially from those anticipated or projected. Unless required by law, the Company does not undertake, and specifically disclaims any obligations to, publicly release any revisions that may be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.

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”). 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 provide useful information that is important to an understanding of the results of the Company’s core business as well as provide information standard in the financial institution industry. Non-GAAP measures should not be considered a substitute for financial measures determined in accordance with GAAP and investors should consider the Company’s performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Amounts previously reported in the consolidated financial statements are reclassified whenever necessary to conform to current period presentation.


8
NBT Bancorp Inc. and Subsidiaries
                             
Selected Financial Data
                             
(unaudited, dollars in thousands except per share data)
                   
                               
   
2021
 
2020
   
2nd Q
   
1st Q
   
4th Q
   
3rd Q
   
2nd Q
 
Profitability:
                             
Diluted earnings per share
 
$
0.92
   
$
0.91
   
$
0.78
   
$
0.80
   
$
0.56
 
Weighted average diluted common shares outstanding
   
43,792,940
     
43,889,889
     
43,973,971
     
43,941,953
     
43,928,344
 
Return on average assets3
   
1.39
%
   
1.46
%
   
1.24
%
   
1.29
%
   
0.94
%
Return on average equity3
   
13.42
%
   
13.57
%
   
11.59
%
   
12.09
%
   
8.76
%
Return on average tangible common equity1 3
   
17.93
%
   
18.24
%
   
15.71
%
   
16.51
%
   
12.14
%
Net interest margin1 3
   
3.00
%
   
3.17
%
   
3.20
%
   
3.17
%
   
3.38
%

   
6 Months Ended June 30,
     
2021
     
2020
 
Profitability:
               
Diluted earnings per share
 
$
1.83
   
$
0.80
 
Weighted average diluted common shares outstanding
   
43,839,060
     
44,026,420
 
Return on average assets3
   
1.42
%
   
0.69
%
Return on average equity3
   
13.49
%
   
6.23
%
Return on average tangible common equity1 3
   
18.08
%
   
8.69
%
Net interest margin1 3
   
3.08
%
   
3.45
%

   
2021
 
2020
 
   
2nd Q
   
1st Q
   
4th Q
   
3rd Q
   
2nd Q
 
Balance sheet data:
                                       
Short-term interest bearing accounts
 
$
883,758
   
$
972,195
   
$
512,686
   
$
450,291
   
$
528,228
 
Securities available for sale
   
1,534,733
     
1,387,028
     
1,348,698
     
1,197,925
     
1,108,443
 
Securities held to maturity
   
622,351
     
592,999
     
616,560
     
663,088
     
599,164
 
Net loans
   
7,419,127
     
7,528,459
     
7,388,885
     
7,446,143
     
7,514,491
 
Total assets
   
11,574,947
     
11,537,253
     
10,932,906
     
10,850,212
     
10,847,184
 
Total deposits
   
9,785,257
     
9,815,930
     
9,081,692
     
8,958,183
     
8,815,891
 
Total borrowings
   
304,110
     
308,766
     
406,731
     
446,737
     
602,988
 
Total liabilities
   
10,349,891
     
10,346,272
     
9,745,288
     
9,684,101
     
9,704,532
 
Stockholders' equity
   
1,225,056
     
1,190,981
     
1,187,618
     
1,166,111
     
1,142,652
 
                                         
Capital:
                                       
Equity to assets
   
10.58
%
   
10.32
%
   
10.86
%
   
10.75
%
   
10.53
%
Tangible equity ratio1
   
8.28
%
   
8.00
%
   
8.41
%
   
8.27
%
   
8.04
%
Book value per share
 
$
28.19
   
$
27.43
   
$
27.22
   
$
26.74
   
$
26.20
 
Tangible book value per share2
 
$
21.50
   
$
20.71
   
$
20.52
   
$
20.02
   
$
19.46
 
Leverage ratio
   
9.40
%
   
9.60
%
   
9.56
%
   
9.48
%
   
9.44
%
Common equity tier 1 capital ratio
   
12.12
%
   
12.13
%
   
11.84
%
   
11.63
%
   
11.34
%
Tier 1 capital ratio
   
13.34
%
   
13.38
%
   
13.09
%
   
12.88
%
   
12.60
%
Total risk-based capital ratio
   
15.78
%
   
15.92
%
   
15.62
%
   
15.43
%
   
15.15
%
Common stock price (end of period)
 
$
35.97
   
$
39.90
   
$
32.10
   
$
26.82
   
$
30.06
 


9
NBT Bancorp Inc. and Subsidiaries
                             
Asset Quality and Consolidated Loan Balances
                         
(unaudited, dollars in thousands)
                             
                               
   
2021
 
2020
 
   
2nd Q
   
1st Q
   
4th Q
   
3rd Q
   
2nd Q
 
Asset quality:
                             
Nonaccrual loans
 
$
40,550
   
$
43,399
   
$
44,647
   
$
35,896
   
$
25,567
 
90 days past due and still accruing
   
2,575
     
2,155
     
3,149
     
2,579
     
2,057
 
Total nonperforming loans
   
43,125
     
45,554
     
47,796
     
38,475
     
27,624
 
Other real estate owned
   
798
     
1,318
     
1,458
     
1,605
     
1,783
 
Total nonperforming assets
   
43,923
     
46,872
     
49,254
     
40,080
     
29,407
 
Allowance for loan losses
   
98,500
     
105,000
     
110,000
     
114,500
     
113,500
 
                                         
Asset quality ratios (total):
                                       
Allowance for loan losses to total loans
   
1.31
%
   
1.38
%
   
1.47
%
   
1.51
%
   
1.49
%
Total nonperforming loans to total loans
   
0.57
%
   
0.60
%
   
0.64
%
   
0.51
%
   
0.36
%
Total nonperforming assets to total assets
   
0.38
%
   
0.41
%
   
0.45
%
   
0.37
%
   
0.27
%
Allowance for loan losses to total nonperforming loans
   
228.41
%
   
230.50
%
   
230.14
%
   
297.60
%
   
410.87
%
Past due loans to total loans4
   
0.26
%
   
0.22
%
   
0.37
%
   
0.26
%
   
0.30
%
Net charge-offs to average loans3
   
0.07
%
   
0.12
%
   
0.21
%
   
0.12
%
   
0.28
%
                                         
Asset quality ratios (excluding paycheck protection program):
                                 
Allowance for loan losses to total loans
   
1.38
%
   
1.48
%
   
1.56
%
   
1.62
%
   
1.59
%
Total nonperforming loans to total loans
   
0.60
%
   
0.64
%
   
0.68
%
   
0.55
%
   
0.39
%
Total nonperforming assets to total assets
   
0.39
%
   
0.43
%
   
0.47
%
   
0.39
%
   
0.28
%
Allowance for loan losses to total nonperforming loans
   
228.36
%
   
230.44
%
   
230.10
%
   
297.53
%
   
410.78
%
Past due loans to total loans4
   
0.27
%
   
0.23
%
   
0.39
%
   
0.28
%
   
0.32
%
Net charge-offs to average loans3
   
0.07
%
   
0.13
%
   
0.22
%
   
0.13
%
   
0.30
%
                                         
   
2021
   
2020
 
   
2nd Q
   
1st Q
   
4th Q
   
3rd Q
   
2nd Q
 
Allowance for loan losses as a percentage of loans by segment:
                         
Commercial & industrial
   
1.11
%
   
1.20
%
   
1.34
%
   
1.34
%
   
1.25
%
Commercial real estate
   
1.26
%
   
1.48
%
   
1.49
%
   
1.57
%
   
1.56
%
Paycheck protection program
   
0.01
%
   
0.01
%
   
0.01
%
   
0.01
%
   
0.01
%
Residential real estate
   
0.98
%
   
1.03
%
   
1.07
%
   
1.21
%
   
1.13
%
Auto
   
0.76
%
   
0.78
%
   
0.93
%
   
0.92
%
   
0.99
%
Other consumer
   
4.27
%
   
4.34
%
   
4.55
%
   
4.66
%
   
5.01
%
Total
   
1.31
%
   
1.38
%
   
1.47
%
   
1.51
%
   
1.49
%
Total excluding PPP loans
   
1.38
%
   
1.48
%
   
1.56
%
   
1.62
%
   
1.59
%
                                         
   
2021
   
2020
 
Loans by line of business:
 
2nd Q
   
1st Q
   
4th Q
   
3rd Q
   
2nd Q
 
Commercial
 
$
1,479,258
   
$
1,466,841
   
$
1,451,560
   
$
1,458,053
   
$
1,474,736
 
Commercial real estate
   
2,265,754
     
2,242,289
     
2,196,477
     
2,121,198
     
2,100,650
 
Paycheck protection program
   
359,738
     
536,494
     
430,810
     
514,558
     
510,097
 
Residential real estate mortgages
   
1,512,354
     
1,478,216
     
1,466,662
     
1,448,530
     
1,460,058
 
Indirect auto
   
899,324
     
913,083
     
931,286
     
989,369
     
1,091,889
 
Specialty lending
   
602,585
     
577,509
     
579,644
     
566,973
     
515,618
 
Home equity
   
351,469
     
369,633
     
387,974
     
404,346
     
415,528
 
Other consumer
   
47,145
     
49,394
     
54,472
     
57,616
     
59,415
 
Total loans
 
$
7,517,627
   
$
7,633,459
   
$
7,498,885
   
$
7,560,643
   
$
7,627,991
 
                                         
PPP unamortized fees (dollars in millions)
 
$
12.6
   
$
14.2
   
$
6.9
   
$
11.3
   
$
14.6
 


10
NBT Bancorp Inc. and Subsidiaries
           
Consolidated Balance Sheets
           
(unaudited, dollars in thousands)
           
             
Assets
 
June 30,
2021
   
December 31,
2020
 
Cash and due from banks
 
$
183,185
   
$
159,995
 
Short-term interest bearing accounts
   
883,758
     
512,686
 
Equity securities, at fair value
   
32,806
     
30,737
 
Securities available for sale, at fair value
   
1,534,733
     
1,348,698
 
Securities held to maturity (fair value $632,954 and $636,827, respectively)
   
622,351
     
616,560
 
Federal Reserve and Federal Home Loan Bank stock
   
25,132
     
27,353
 
Loans held for sale
   
1,404
     
1,119
 
Loans
   
7,517,627
     
7,498,885
 
Less allowance for loan losses
   
98,500
     
110,000
 
Net loans
 
$
7,419,127
   
$
7,388,885
 
Premises and equipment, net
   
72,482
     
74,206
 
Goodwill
   
280,541
     
280,541
 
Intangible assets, net
   
10,241
     
11,735
 
Bank owned life insurance
   
226,507
     
186,434
 
Other assets
   
282,680
     
293,957
 
Total assets
 
$
11,574,947
   
$
10,932,906
 
                 
Liabilities and stockholders' equity
               
Demand (noninterest bearing)
 
$
3,582,705
   
$
3,241,123
 
Savings, NOW and money market
   
5,633,523
     
5,207,090
 
Time
   
569,029
     
633,479
 
Total deposits
 
$
9,785,257
   
$
9,081,692
 
Short-term borrowings
   
90,598
     
168,386
 
Long-term debt
   
14,045
     
39,097
 
Subordinated debt, net
   
98,271
     
98,052
 
Junior subordinated debt
   
101,196
     
101,196
 
Other liabilities
   
260,524
     
256,865
 
Total liabilities
 
$
10,349,891
   
$
9,745,288
 
                 
Total stockholders' equity
 
$
1,225,056
   
$
1,187,618
 
                 
Total liabilities and stockholders' equity
 
$
11,574,947
   
$
10,932,906
 


11
NBT Bancorp Inc. and Subsidiaries
                       
Consolidated Statements of Income
                       
(unaudited, dollars in thousands except per share data)
                   
                         
   
Three Months Ended
June 30,
   
Six Months Ended
June 30,
 
   
2021
   
2020
   
2021
   
2020
 
Interest, fee and dividend income
                       
Interest and fees on loans
 
$
74,795
   
$
77,270
   
$
149,888
   
$
155,998
 
Securities available for sale
   
5,762
     
5,600
     
11,306
     
11,353
 
Securities held to maturity
   
3,096
     
3,926
     
6,478
     
8,017
 
Other
   
391
     
650
     
682
     
1,479
 
Total interest, fee and dividend income
 
$
84,044
   
$
87,446
   
$
168,354
   
$
176,847
 
Interest expense
                               
Deposits
 
$
2,862
   
$
4,812
   
$
6,034
   
$
13,916
 
Short-term borrowings
   
32
     
972
     
102
     
2,769
 
Long-term debt
   
88
     
393
     
212
     
786
 
Subordinated debt
   
1,359
     
128
     
2,718
     
128
 
Junior subordinated debt
   
525
     
695
     
1,055
     
1,621
 
Total interest expense
 
$
4,866
   
$
7,000
   
$
10,121
   
$
19,220
 
Net interest income
 
$
79,178
   
$
80,446
   
$
158,233
   
$
157,627
 
Provision for loan losses
   
(5,216
)
   
18,840
     
(8,012
)
   
48,480
 
Net interest income after provision for loan losses
 
$
84,394
   
$
61,606
   
$
166,245
   
$
109,147
 
Noninterest income
                               
Service charges on deposit accounts
 
$
3,028
   
$
2,529
   
$
6,055
   
$
6,526
 
ATM and debit card fees
   
8,309
     
6,136
     
15,171
     
11,990
 
Retirement plan administration fees
   
9,779
     
9,214
     
19,877
     
17,155
 
Wealth management fees
   
8,406
     
6,823
     
16,316
     
14,096
 
Insurance services
   
3,508
     
3,292
     
6,969
     
7,561
 
Bank owned life insurance income
   
1,659
     
1,381
     
3,040
     
2,755
 
Net securities gains (losses)
   
201
     
180
     
668
     
(632
)
Other
   
4,426
     
5,456
     
8,258
     
10,983
 
Total noninterest income
 
$
39,316
   
$
35,011
   
$
76,354
   
$
70,434
 
Noninterest expense
                               
Salaries and employee benefits
 
$
42,671
   
$
39,717
   
$
84,272
   
$
80,467
 
Occupancy
   
5,291
     
5,065
     
11,164
     
11,060
 
Data processing and communications
   
4,427
     
4,079
     
9,158
     
8,312
 
Professional fees and outside services
   
4,030
     
3,403
     
7,619
     
7,300
 
Equipment
   
5,493
     
4,779
     
10,670
     
9,421
 
Office supplies and postage
   
1,615
     
1,455
     
3,114
     
3,091
 
FDIC expense
   
663
     
993
     
1,471
     
1,304
 
Advertising
   
468
     
322
     
919
     
931
 
Amortization of intangible assets
   
682
     
883
     
1,494
     
1,717
 
Loan collection and other real estate owned, net
   
663
     
728
     
1,253
     
1,745
 
Other
   
5,416
     
3,916
     
8,173
     
10,873
 
Total noninterest expense
 
$
71,419
   
$
65,340
   
$
139,307
   
$
136,221
 
Income before income tax expense
 
$
52,291
   
$
31,277
   
$
103,292
   
$
43,360
 
Income tax expense
   
11,995
     
6,564
     
23,150
     
8,279
 
Net income
 
$
40,296
   
$
24,713
   
$
80,142
   
$
35,081
 
Earnings Per Share
                               
Basic
 
$
0.93
   
$
0.57
   
$
1.84
   
$
0.80
 
Diluted
 
$
0.92
   
$
0.56
   
$
1.83
   
$
0.80
 


12
NBT Bancorp Inc. and Subsidiaries
                             
Quarterly Consolidated Statements of Income
                         
(unaudited, dollars in thousands except per share data)
                   
                               
   
2021
   
2020
 
   
2nd Q
   
1st Q
   
4th Q
   
3rd Q
   
2nd Q
 
Interest, fee and dividend income
                             
Interest and fees on loans
 
$
74,795
   
$
75,093
   
$
76,863
   
$
74,998
   
$
77,270
 
Securities available for sale
   
5,762
     
5,544
     
5,478
     
5,603
     
5,600
 
Securities held to maturity
   
3,096
     
3,382
     
3,532
     
3,734
     
3,926
 
Other
   
391
     
291
     
568
     
659
     
650
 
Total interest, fee and dividend income
 
$
84,044
   
$
84,310
   
$
86,441
   
$
84,994
   
$
87,446
 
Interest expense
                                       
Deposits
 
$
2,862
   
$
3,172
   
$
3,887
   
$
4,267
   
$
4,812
 
Short-term borrowings
   
32
     
70
     
193
     
446
     
972
 
Long-term debt
   
88
     
124
     
369
     
398
     
393
 
Subordinated debt
   
1,359
     
1,359
     
1,339
     
1,375
     
128
 
Junior subordinated debt
   
525
     
530
     
545
     
565
     
695
 
Total interest expense
 
$
4,866
   
$
5,255
   
$
6,333
   
$
7,051
   
$
7,000
 
Net interest income
 
$
79,178
   
$
79,055
   
$
80,108
   
$
77,943
   
$
80,446
 
Provision for loan losses
   
(5,216
)
   
(2,796
)
   
(607
)
   
3,261
     
18,840
 
Net interest income after provision for loan losses
 
$
84,394
   
$
81,851
   
$
80,715
   
$
74,682
   
$
61,606
 
Noninterest income
                                       
Service charges on deposit accounts
 
$
3,028
   
$
3,027
   
$
3,588
   
$
3,087
   
$
2,529
 
ATM and debit card fees
   
8,309
     
6,862
     
6,776
     
7,194
     
6,136
 
Retirement plan administration fees
   
9,779
     
10,098
     
9,011
     
9,685
     
9,214
 
Wealth management fees
   
8,406
     
7,910
     
7,456
     
7,695
     
6,823
 
Insurance services
   
3,508
     
3,461
     
3,454
     
3,742
     
3,292
 
Bank owned life insurance income
   
1,659
     
1,381
     
1,733
     
1,255
     
1,381
 
Net securities gains
   
201
     
467
     
160
     
84
     
180
 
Other
   
4,426
     
3,832
     
5,937
     
4,985
     
5,456
 
Total noninterest income
 
$
39,316
   
$
37,038
   
$
38,115
   
$
37,727
   
$
35,011
 
Noninterest expense
                                       
Salaries and employee benefits
 
$
42,671
   
$
41,601
   
$
41,016
   
$
40,451
   
$
39,717
 
Occupancy
   
5,291
     
5,873
     
5,280
     
5,294
     
5,065
 
Data processing and communications
   
4,427
     
4,731
     
4,157
     
4,058
     
4,079
 
Professional fees and outside services
   
4,030
     
3,589
     
4,388
     
3,394
     
3,403
 
Equipment
   
5,493
     
5,177
     
5,395
     
5,073
     
4,779
 
Office supplies and postage
   
1,615
     
1,499
     
1,517
     
1,530
     
1,455
 
FDIC expense
   
663
     
808
     
739
     
645
     
993
 
Advertising
   
468
     
451
     
827
     
530
     
322
 
Amortization of intangible assets
   
682
     
812
     
822
     
856
     
883
 
Loan collection and other real estate owned, net
   
663
     
590
     
930
     
620
     
728
 
Other
   
5,416
     
2,757
     
10,133
     
3,857
     
3,916
 
Total noninterest expense
 
$
71,419
   
$
67,888
   
$
75,204
   
$
66,308
   
$
65,340
 
Income before income tax expense
 
$
52,291
   
$
51,001
   
$
43,626
   
$
46,101
   
$
31,277
 
Income tax expense
   
11,995
     
11,155
     
9,432
     
10,988
     
6,564
 
Net income
 
$
40,296
   
$
39,846
   
$
34,194
   
$
35,113
   
$
24,713
 
Earnings Per Share
                                       
Basic
 
$
0.93
   
$
0.91
   
$
0.78
   
$
0.80
   
$
0.57
 
Diluted
 
$
0.92
   
$
0.91
   
$
0.78
   
$
0.80
   
$
0.56
 


13
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 - 2021
     
Q1 - 2021
     
Q4 - 2020
     
Q3 - 2020
     
Q2 - 2020
 
Assets
                                                                     
Short-term interest bearing accounts
 
$
974,034
     
0.09
%
 
$
587,358
     
0.09
%
 
$
552,529
     
0.11
%
 
$
477,946
     
0.11