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FOR IMMEDIATE RELEASE

ATTENTION: FINANCIAL AND BUSINESS EDITORS

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NBT BANCORP INC. ANNOUNCES NET INCOME OF $154.9 MILLION ($3.54 PER DILUTED COMMON SHARE); APPROVES DIVIDEND

NORWICH, NY (January 26, 2022) – NBT Bancorp Inc. (“NBT” or the “Company”) (NASDAQ: NBTB) reported net income and diluted earnings per share for the quarter and year ended December 31, 2021.

 

Net income for the year ended December 31, 2021 was $154.9 million, up 48.4% from $104.4 million for the prior year primarily due to changes in the estimated impact of the COVID-19 pandemic on expected credit losses. Diluted earnings per share for the year ended December 31, 2021 was $3.54, as compared with $2.37 for the prior year, an increase of 49.4%.

Pre-provision net revenue (“PPNR”)¹ for the year ended December 31, 2021 was $195.3 million compared to $193.4 million in the prior year. The increase in PPNR from the prior year reflected higher net interest income and higher noninterest income partly offset by higher noninterest expense. Income from Paycheck Protection Program (“PPP”) loans increased $7.1 million from the prior year.

Net income for the three months ended December 31, 2021 was $37.3 million, or $0.86 per diluted common share. Net income increased $3.1 million from the fourth quarter of 2020, primarily due to higher net interest income and higher noninterest income, partly offset by higher provision for loan losses. The fourth quarter 2021 provision for loan losses was $3.1 million compared to the fourth quarter 2020 provision release of $0.6 million. Quarterly net income was consistent with the previous quarter and reflected improved revenue generation offset by a higher provision for loan losses and higher noninterest expense.

PPNR¹ for the fourth quarter of 2021 was $51.5 million compared to $47.4 million in the previous quarter and $48.2 million in the fourth quarter of 2020. Income from PPP loans increased $4.7 million and $1.9 million from the previous quarter and the fourth quarter of 2020, respectively.

 

CEO Comments

“Our fourth quarter and full-year results for 2021 reflect the hard work of our team, and our strong finish is the culmination of a record year,” said NBT President and CEO John H. Watt, Jr. “Our fee-based businesses achieved new levels of success year over year, and we saw digital adoption continue to soar across our consumer and commercial platforms, including a 64% increase in consumer digital adoption. NBT has a strong and growing capital base, which provides us with optionality that will enable our dedicated and talented team to be successful in 2022. I am excited to welcome Heidi Hoeller as our newest director. With over 25 years of experience in public accounting and financial services, we look forward to adding her valuable perspective to our strategic thinking.”

Fourth Quarter Financial Highlights

Net Income	◾           Net income of $37.3 million ◾           Diluted earnings per share of $0.86
Net Interest Income / NIM	◾           Net interest income on a fully taxable equivalent basis was $85.5 million1 ◾           Net interest margin (“NIM”) on a fully taxable equivalent basis was 3.08%1, up 20 basis points (“bps”) from the prior quarter ◾           Total cost of deposits of 0.08%
PPNR	◾           PPNR1 was $51.5 million compared to $47.4 million in the third quarter of 2021 and $48.2 million in the fourth quarter of 2020
Loans and Credit Quality	◾           Period end total loans were $7.5 billion at December 31, 2021 ◾           Excluding $101 million and $431 million of PPP loans at December 31, 2021 and December 31, 2020, respectively, period end loans increased $329 million or 5% from December 31, 2020 ◾           Allowance for loan losses to total loans of 1.23% (1.24% excluding PPP loans), was consistent with the third quarter 2021 (down 4 bps excluding PPP loans) ◾           Net charge-offs to average loans were 0.22%, annualized (0.22% excluding PPP loans) ◾           Nonperforming loans to total loans were 0.44% (0.44% excluding PPP loans), down from 0.51% (0.53% excluding PPP loans) in the prior quarter
Capital	◾           Tangible book value per share2 grew 1% for the quarter and 8% from prior year to $22.26 at December 31, 2021 ◾           Tangible equity to assets of 8.20%1 ◾           CET1 ratio of 12.25%; Leverage ratio of 9.41%

Loans

Deposits

Net Interest Income and Net Interest Margin

 

Credit Quality and Allowance for Credit Losses

Noninterest Income

 

Noninterest Expense

 

Income Taxes

Capital

Dividend and Stock Repurchase

Conference Call and Webcast

The Company will host a conference call at 8:30 a.m. (Eastern) Thursday, January 27, 2022, to review fourth 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

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 COVID-19 global pandemic; and (21) the Company’s success at managing the risks involved in the foregoing items.

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, treatment developments, public adoption rates of COVID-19 vaccines, including booster shots, and their effectiveness against emerging variants of COVID-19, including the Delta and Omicron variants, the impact of the COVID-19 pandemic 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.

NBT Bancorp Inc. and Subsidiaries

Selected Financial Data

(unaudited, dollars in thousands except per share data)

		2021																2020
		4th Q				3rd Q				2nd Q				1st Q				4th Q
Profitability:
Diluted earnings per share		$	0.86			$	0.86			$	0.92			$	0.91			$	0.78
Weighted average diluted common shares outstanding			43,574,539				43,631,497				43,792,940				43,889,889				43,973,971
Return on average assets3			1.23	%			1.26	%			1.39	%			1.46	%			1.24	%
Return on average equity3			11.89	%			12.04	%			13.42	%			13.57	%			11.59	%
Return on average tangible common equity1 3			15.70	%			15.97	%			17.93	%			18.24	%			15.71	%
Net interest margin1 3			3.08	%			2.88	%			3.00	%			3.17	%			3.20	%
		12 Months Ended December 31,
			2021				2020
Profitability:
Diluted earnings per share		$	3.54			$	2.37
Weighted average diluted common shares outstanding			43,718,804				43,988,623
Return on average assets			1.33	%			0.99	%
Return on average equity			12.71	%			9.09	%
Return on average tangible common equity1			16.92	%			12.48	%
Net interest margin1			3.03	%			3.31	%
		2021																2020
		4th Q				3rd Q				2nd Q				1st Q				4th Q
Balance sheet data:
Short-term interest-bearing accounts		$	1,111,296			$	1,131,074			$	883,758			$	972,195			$	512,686
Securities available for sale			1,687,361				1,576,030				1,534,733				1,387,028				1,348,698
Securities held to maturity			733,210				683,103				622,351				592,999				616,560
Net loans			7,406,459				7,473,442				7,419,127				7,528,459				7,388,885
Total assets			12,012,111				11,994,411				11,574,947				11,537,253				10,932,906
Total deposits			10,234,469				10,195,178				9,785,257				9,815,930				9,081,692
Total borrowings			311,476				313,311				304,110				308,766				406,731
Total liabilities			10,761,658				10,752,954				10,349,891				10,346,272				9,745,288
Stockholders’ equity			1,250,453				1,241,457				1,225,056				1,190,981				1,187,618
Capital:
Equity to assets			10.41	%			10.35	%			10.58	%			10.32	%			10.86	%
Tangible equity ratio1			8.20	%			8.13	%			8.28	%			8.00	%			8.41	%
Book value per share		$	28.97			$	28.65			$	28.19			$	27.43			$	27.22
Tangible book value per share2		$	22.26			$	21.95			$	21.50			$	20.71			$	20.52
Leverage ratio			9.41	%			9.47	%			9.40	%			9.60	%			9.56	%
Common equity tier 1 capital ratio			12.25	%			12.20	%			12.12	%			12.13	%			11.84	%
Tier 1 capital ratio			13.43	%			13.39	%			13.34	%			13.38	%			13.09	%
Total risk-based capital ratio			15.73	%			15.74	%			15.78	%			15.92	%			15.62	%
Common stock price (end of period)		$	38.52			$	36.12			$	35.97			$	39.90			$	32.10