Tompkins Financial (TMP) 8-K Results of Operations and Financial Condition

Tompkins Financial Corporation 8-K

Exhibit 99.1

 

For more information contact:

Stephen S. Romaine, President & CEO

Francis M. Fetsko, CFO & COO

Tompkins Financial Corporation888.503.5753

For Immediate Release

Friday, April 25, 2014

Tompkins Financial Corporation Reports Increased First Quarter Earnings

ITHACA, NY – Tompkins Financial Corporation (TMP–NYSE MKT LLC)

Tompkins Financial Corporation reported net income of $12.6 million for the first quarter of 2014, an increase of 9.2% from the $11.5 million reported for the same period in 2013. Diluted earnings per share were $0.84 for the first quarter of 2014, a 6.3% increase from $0.79 reported for the first quarter of 2013. Prior period results included in this press release were impacted by certain non-recurring items, which are more fully described in the non-GAAP disclosure tables included with this press release.

President and CEO, Stephen S. Romaine said "We are pleased to start 2014 with the strongest first quarter in our history. In addition to earnings per share growth over the first quarter of 2013, loan and deposit levels increased from the same period last year, and from the most recent prior quarter. At the same time we saw continued improvement in nearly all credit quality indicators.”

fIRST QUARTER Selected highlights:

§ Net interest income of $40.0 million was up 4.8% from the same period last year.

§ Annualized return on average equity was 10.88% for the quarter ended March 31, 2014, compared to 10.53% for the same period in 2013.

§ Tangible book value per share has increased for the third consecutive quarter, and is up 5.8% from the first quarter of 2013. Refer to Non-GAAP disclosure for additional details on tangible book value per share.

§ Credit quality improved with non-performing assets representing 0.81% of total assets, which is the lowest this percentage has been over the past 20 quarters, and remains well below the most recent peer average of 1.69% by the Federal Reserve¹.

§ Total loans of $3.2 billion were up 7.0% over the same period in 2013, and were up an annualized 1.3% over year-end 2013.

§ The average cost of deposits declined from 0.34% in the first quarter of 2013, to 0.28% in 2014. Average total deposits for the first quarter of 2014 were $4.0 billion, which is comparable to the same period in 2013.

 NET INTEREST INCOME

Net interest income of $40.0 million for the first quarter of 2014 increased 4.8% compared to $38.2 million reported for the same period in 2013. Net interest income was down $2.6 million or 6.1% from the fourth quarter of 2013. The fourth quarter included higher interest income related to interest collected on the payoff of a nonaccrual loan and a higher level of purchase accounting accretion related to loans paid off during the fourth quarter of 2013. The net interest margin for the first quarter of 2014 was 3.60% compared to 3.57% for the first quarter of 2013 and 3.78% for the fourth quarter of 2013.

NONINTEREST INCOME

Noninterest income was $17.4 million for the first quarter of 2014, which was in line with both the same period prior year and the fourth quarter of 2013. Noninterest income represented 30.3% of total revenue for the first quarter of 2014, compared to 31.3% for the same period in 2013. Fee based services related to wealth management, deposit fees, and card services fees, were all up from the same period in 2013, while insurance revenues were in line with the prior year period. Other noninterest income was down from the first quarter of 2013, in part due to certain nonrecurring items in the first quarter of 2013. The first quarter of 2014 also saw a decline in realized gains on the sale of securities, when compared to the first quarter of 2013.

NONINTEREST EXPENSE

Noninterest expense was $38.2 million for the first quarter of 2014, up 1.8% compared to March 31, 2013, and down 5.1% from the fourth quarter of 2013. The increase in noninterest expense compared to the same period prior year is mainly a result of higher salary and wages expense. The decline in noninterest expense when compared to the fourth quarter of 2013 was driven by higher salary and wages in the fourth quarter, which included increased variable compensation accruals, reflecting the Company’s strong performance in 2013.

ASSET QUALITY

Asset quality trends improved in nearly all categories during the quarter. Substandard and Special Mention loans declined by $39.5 million from the same period last year, and by $1.6 million from the most recent previous quarter. The percentage of nonperforming loans and leases to total loans and leases improved to 1.11% at March 31, 2014, compared to 1.24% reported at March 31, 2013.

Provision for loan and lease losses was $743,000 for the first quarter of 2014, which was an improvement of 28.4% compared to the first quarter of 2013. Net loan and lease charge-offs totaled $699,000 in the first quarter of 2014, down from $1.0 million in the first quarter of 2013.

The Company’s allowance for originated loan and lease losses totaled $26.7 million at March 31, 2014, which represented 1.04% of total originated loans, compared to 1.11% at March 31, 2013 and 1.06% at year-end 2013. The allowance for loan and lease losses covered 78.88% of nonperforming loans and leases as of March 31, 2014, compared to 66.16% at March 31, 2013 and 71.65% at year-end 2013.

CAPITAL POSITION

Capital ratios remain well above the regulatory well capitalized minimums. Tier 1 capital to average assets improved for the fifth consecutive quarter, to 8.68% at March 31, 2014, and the ratio of total capital to risk-weighted assets was 13.68%.

ABOUT TOMPKINS FINANCIAL CORPORATION

Tompkins Financial Corporation is a financial services company serving the Central, Western, and Hudson Valley regions of New York and the Southeastern region of Pennsylvania. Headquartered in Ithaca, NY, Tompkins Financial is parent to Tompkins Trust Company, The Bank of Castile, Mahopac Bank, VIST Bank, Tompkins Insurance Agencies, Inc., and offers wealth management services through Tompkins Financial Advisors. For more information on Tompkins Financial, visit www.tompkinsfinancial.com.

 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 reconciliation to the comparable GAAP measure, is provided in the accompanying tables. Management believes that these non-GAAP measures provide useful information. 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. See “Tompkins Financial Corporation - Summary Financial Data (Unaudited)” tables for Non-GAAP related calculations. 

"Safe Harbor" Statement under the Private Securities Litigation Reform of 1995:

This press release may include forward-looking statements with respect to revenue sources, growth, market risk, and corporate objectives. The Company assumes no duty, and specifically disclaims any obligation, to update forward-looking statements, and cautions that these statements are subject to numerous assumptions, risks, and uncertainties, all of which could change over time. Actual results could differ materially from forward-looking statements.

TOMPKINS FINANCIAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION
(In thousands, except share and per share data) (Unaudited)				As of		As of
ASSETS				03/31/2014		12/31/2013
Cash and noninterest bearing balances due from banks			$	97,283	$	82,163
Interest bearing balances due from banks				1,016		721
	Cash and Cash Equivalents			98,299		82,884
Trading securities, at fair value				10,498		10,991
Available-for-sale securities, at fair value (amortized cost of $1,384,804 at March 31,
	2014 and $1,368,736 at December 31, 2013)			1,379,600		1,354,811
Held-to-maturity securities, fair value of $19,434 at March 31, 2014, and $19,625
	at December 31, 2013			18,820		18,980
Originated loans and leases, net of unearned income and deferred costs and fees				2,555,522		2,527,244
Acquired loans and leases, covered				24,106		25,868
Acquired loans and leases, non-covered				624,584		641,172
Less:  Allowance for loan and lease losses				28,014		27,970
	Net Loans and Leases			3,176,198		3,166,314
FDIC Indemnification Asset				3,999		4,790
Federal Home Loan Bank stock				18,240		25,041
Bank premises and equipment, net				56,776		55,932
Corporate owned life insurance				72,339		69,335
Goodwill				92,246		92,140
Other intangible assets, net				16,004		16,298
Accrued interest and other assets				98,781		105,523
	Total Assets		$	5,041,800	$	5,003,039
LIABILITIES
Deposits:
	Interest bearing:
	Checking, savings and money market			2,338,780		2,190,616
	Time			898,884		865,702
	Noninterest bearing			867,506		890,898
	Total Deposits			4,105,170		3,947,216
Federal funds purchased and securities sold under agreements to repurchase				158,794		167,724
Other borrowings, including certain amounts at fair value of $11,228 at March 31, 2014
	and $11,292 at December 31, 2013			214,616		331,531
Trust preferred debentures				37,211		37,169
Other liabilities				52,187		61,460
	Total Liabilities		$	4,567,978	$	4,545,100
EQUITY
Tompkins Financial Corporation shareholders' equity:
	Common Stock - par value $.10 per share: Authorized 25,000,000 shares; Issued:
		14,864,917 at March 31, 2014; and 14,785,007 at December 31, 2013		1,486		1,479
	Additional paid-in capital			349,812		346,096
	Retained earnings			143,766		137,102
	Accumulated other comprehensive loss			(19,685)		(25,119)
	Treasury stock, at cost – 103,921 shares at March 31, 2014, and 105,449 shares
		at December 31, 2013		(3,042)		(3,071)
	Total Tompkins Financial Corporation Shareholders’ Equity			472,337		456,487
Noncontrolling interests				1,485		1,452
	Total Equity		$	473,822	$	457,939
	Total Liabilities and Equity		$	5,041,800	$	5,003,039

TOMPKINS FINANCIAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
		Three Months Ended
(In thousands, except per share data) (Unaudited)		03/31/2014		03/31/2013
INTEREST AND DIVIDEND INCOME
Loans	$	36,954	$	36,429
Due from banks		1		7
Trading securities		112		165
Available-for-sale securities		7,936		7,480
Held-to-maturity securities		152		191
Federal Home Loan Bank stock and Federal Reserve Bank stock		210		185
Total Interest and Dividend Income		45,365		44,457
INTEREST EXPENSE
Time certificates of deposits of $100,000 or more		952		1,204
Other deposits		1,790		2,182
Federal funds purchased and securities sold under agreements to
repurchase		817		1,010
Trust preferred debentures		570		687
Other borrowings		1,209		1,168
Total Interest Expense		5,338		6,251
Net Interest Income		40,027		38,206
Less:  Provision for loan and lease losses		743		1,038
Net Interest Income After Provision for Loan and Lease Losses		39,284		37,168
NONINTEREST INCOME
Insurance commissions and fees		7,257		7,261
Investment services income		4,010		3,788
Service charges on deposit accounts		2,116		1,908
Card services income		2,112		1,738
Mark-to-market loss on trading securities		(59)		(115)
Mark-to-market gain on liabilities held at fair value		65		77
Other income		1,839		2,366
Gain on sale of available-for-sale securities		94		367
Total Noninterest Income		17,434		17,390
NONINTEREST EXPENSES
Salaries and wages		16,646		15,572
Pension and other employee benefits		6,045		6,070
Net occupancy expense of premises		3,260		3,061
Furniture and fixture expense		1,337		1,457
FDIC insurance		811		772
Amortization of intangible assets		527		557
Merger related expenses		0		196
Other operating expense		9,584		9,835
Total Noninterest Expenses		38,210		37,520
Income Before Income Tax Expense		18,508		17,038
Income Tax Expense		5,906		5,495
Net Income attributable to Noncontrolling Interests and Tompkins Financial Corporation		12,602		11,543
Less:  Net income attributable to noncontrolling interests		33		33
Net Income Attributable to Tompkins Financial Corporation	$	12,569	$	11,510
Basic Earnings Per Share	$	0.85	$	0.80
Diluted Earnings Per Share	$	0.84	$	0.79

Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited)
				Year to Date Period Ended					Year to Date Period Ended
				March 31, 2014					March 31, 2013
				Average					Average
				Balance			Average		Balance			Average
(Dollar amounts in thousands)				(YTD)		Interest	Yield/Rate		(YTD)		Interest	Yield/Rate
ASSETS
Interest-earning assets
	Interest-bearing balances due from banks		$	1,026	$	1	0.40%	$	3,908	$	7	0.73%
	Securities (4)
		U.S. Government securities		1,284,771		7,373	2.33%		1,297,578		6,794	2.12%
		Trading securities		10,832		112	4.19%		16,126		165	4.15%
		State and municipal (5)		88,037		1,109	5.11%		100,089		1,299	5.26%
		Other securities (5)		5,194		44	3.44%		9,158		90	3.99%
		Total securities		1,388,834		8,638	2.52%		1,422,951		8,348	2.38%
	FHLBNY and FRB stock			20,137		210	4.23%		18,859		185	3.98%
	Total loans and leases, net of unearned income (5)(6)			3,192,520		37,399	4.75%		2,963,737		36,567	5.00%
	Total interest-earning assets			4,602,517		46,248	4.08%		4,409,455		45,107	4.15%
Other assets				379,516					490,272
	Total assets			4,982,033					4,899,727
LIABILITIES & EQUITY
Deposits
	Interest-bearing deposits
		Interest bearing checking, savings,  & money market		2,287,871		1,097	0.19%		2,269,900		1,418	0.25%
		Time deposits		888,474		1,645	0.75%		979,860		1,968	1.02%
		Total interest-bearing deposits		3,176,345		2,742	0.35%		3,249,760		3,386	0.42%
Federal funds purchased & securities sold under
		agreements to repurchase		162,348		817	2.04%		198,707		1,010	2.06%
Other borrowings				248,678		1,209	1.97%		119,606		1,168	3.96%
Trust preferred debentures				37,184		570	6.22%		43,675		687	6.38%
	Total interest-bearing liabilities			3,624,555		5,338	0.60%		3,611,748		6,251	0.70%
Noninterest bearing deposits				834,864					771,761
Accrued expenses and other liabilities				54,099					72,941
	Total liabilities			4,513,518					4,456,450
Tompkins Financial Corporation Shareholders’ equity				467,048					441,810
Noncontrolling interest				1,467					1,467
	Total equity			468,515					443,277
	Total liabilities and equity		$	4,982,033				$	4,899,727
Interest rate spread							3.48%					3.45%
	Net interest income/margin on earning assets					40,910	3.60%				38,856	3.57%
Tax Equivalent Adjustment						(883)					(650)
	Net interest income per consolidated financial statements				$	40,027				$	38,206

Tompkins Financial Corporation - Summary Financial Data (Unaudited)
(In thousands, except per share data)		Quarter-Ended									Year-Ended
		Mar-14		Dec-13		Sep-13		Jun-13		Mar-13		Dec-13
Period End Balance Sheet
Securities	$	1,408,918	$	1,384,782	$	1,390,233	$	1,469,315	$	1,566,510	$	1,384,782
Originated loans and leases, net of unearned income and deferred costs and fees (2)		2,555,522		2,527,244		2,420,695		2,309,232		2,208,346		2,527,244
Acquired loans and leases (3)		648,690		667,040		698,617		745,951		785,449		667,040
Allowance for  loan and lease losses		28,014		27,970		26,408		25,458		24,661		27,970
Total assets		5,041,800		5,003,039		4,932,428		4,931,883		4,987,280		5,003,039
Total deposits		4,105,170		3,947,216		3,972,756		3,912,910		4,072,352		3,947,216
Federal funds purchased and securities sold under agreements to repurchase		158,794		167,724		162,117		171,498		194,091		167,724
Other borrowings		214,616		331,531		242,177		299,098		156,649		331,531
Trust preferred debentures		37,211		37,169		37,127		43,703		43,687		37,169
Shareholders' equity		473,822		457,939		444,276		431,894		446,812		457,939
Average Balance Sheet
Average earning assets	$	4,602,517	$	4,571,099	$	4,533,603	$	4,571,428	$	4,409,455	$	4,521,873
Average assets		4,982,033		4,950,476		4,897,678		4,965,895		4,899,727		4,928,499
Average interest-bearing liabilities		3,624,555		3,574,803		3,572,708		3,663,230		3,611,748		3,605,430
Average equity		468,515		449,445		434,482		447,088		443,277		443,565
Share data
Weighted average shares outstanding (basic)		14,644,548		14,589,120		14,515,053		14,427,838		14,374,265		14,477,617
Weighted average shares outstanding (diluted)		14,775,386		14,731,786		14,622,512		14,496,859		14,436,757		14,573,919
Period-end shares outstanding		14,829,007		14,749,097		14,692,671		14,599,558		14,447,017		14,749,097
Book value per share		31.95		31.05		30.24		29.58		30.93		31.05
Tangible book value per share (Non-GAAP)		24.65		23.70		22.82		22.08		23.29		23.70
Income Statement
Net interest income	$	40,027	$	42,624	$	40,473	$	39,826	$	38,206	$	161,129
Provision for loan/lease losses		743		585		2,049		2,489		1,038		6,161
Noninterest income		17,434		17,439		18,528		16,541		17,390		69,898
Noninterest expense		38,210		40,251		37,554		37,777		37,520		153,102
Income tax expense		5,906		4,905		5,316		5,061		5,495		20,777
Net income attributable to Tompkins Financial Corporation		12,602		14,290		14,049		11,007		11,510		50,856
Noncontrolling interests		33		32		33		33		33		131
Basic earnings per share (9)	$	0.85	$	0.97	$	0.96	$	0.76	$	0.80	$	3.48
Diluted earnings per share (9)	$	0.84	$	0.96	$	0.95	$	0.75	$	0.79	$	3.46
Nonperforming Assets
Originated nonaccrual loans and leases	$	26,974	$	29,875	$	33,881	$	32,100	$	32,554	$	29,875
Acquired nonaccrual loans and leases		6,936		8,508		8,008		6,916		4,561		8,508
Originated loans and leases 90 days past due and accruing		339		607		1,217		156		157		607
Troubled debt restructurings not included above		1,266		45		46		0		-		45
Total nonperforming loans and leases		35,515		39,035		43,152		39,172		37,272		39,035
OREO (8)		5,351		4,253		6,264		4,918		3,950		4,253
Total nonperforming assets		40,866		43,288		49,416		44,090		41,222		43,288

Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued
		Quarter-Ended									Year-Ended
Delinquency - Originated loan and lease portfolio		Mar-14		Dec-13		Sep-13		Jun-13		Mar-13		Dec-13
Loans and leases 30-89 days past due and
accruing (2)	$	5,660	$	5,762	$	12,193	$	9,597	$	10,888	$	5,762
Loans and leases 90 days past due and accruing (2)		339		607		1,217		156		157		607
Total originated loans and leases past due and accruing (2)		5,999		6,369		13,410		9,753		11,045		6,369
Delinquency - Acquired loan and lease portfolio
Covered loans and leases 30-89 days past due and accruing (3)(7)		635		0		1,132		1,613		3,503		0
Covered loans and leases 90 days or more past
due and accruing (3)(7)		1,135		2,416		2,980		3,091		3,809		2,416
Non-covered loans and leases 30-89 days past
due and accruing (3)(7)		2,293		1,532		6,887		5,591		5,738		1,532
Non-Covered loans and leases 90 days past
due and accruing (3)(7)		3,746		4,557		10,521		13,324		14,026		4,557
Total acquired loans and leases past due and accruing		7,809		8,505		21,520		23,619		27,076		8,505
Total loans and leases past due and accruing	$	13,808	$	14,874	$	34,930	$	33,372	$	38,121	$	14,874
Allowance for Loan Losses - Originated loan and lease portfolio
Balance at beginning of period	$	26,700	$	25,722	$	24,853	$	24,598	$	24,643	$	24,643
Provision for loan and lease losses		511		(325)		1,499		(994)		820		1,000
Net loan and lease (recoveries) charge-offs		550		(1,303)		630		(1,249)		865		(1,057)
Allowance for loan and lease losses (originated		26,661		26,700		25,722		24,853		24,598		26,700
loan portfolio) - balance at end of period
Allowance for Loan Losses - Acquired loan and lease portfolio
Balance at beginning of period	$	1,270	$	686	$	605	$	63	$	0	$	0
Provision for loan and lease losses		232		910		549		3,483		218		5,160
Net loan and lease charge-offs		149		326		468		2,941		155		3,890
Allowance for loan and lease losses (acquired
loan portfolio) - balance at end of period		1,353		1,270		686		605		63		1,270
Total allowance for loan and lease losses		28,014		27,970		26,408		25,458		24,661		27,970
Loan Classification - Originated Portfolio
Special Mention	$	44,725	$	42,365	$	42,975	$	43,099	$	48,468	$	42,365
Substandard		32,917		35,022		37,004		41,969		43,449		35,022
Loan Classification - Acquired Portfolio
Special Mention		14,936		17,322		23,939		29,300		26,568		17,322
Substandard		34,137		33,561		42,433		55,079		47,698		33,561
Loan Classifications - Total Portfolio
Special Mention		59,661		59,687		66,914		72,399		75,036		59,687
Substandard		67,054		68,583		79,437		97,048		91,147		68,583

Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued
RATIO ANALYSIS		Quarter-Ended									Year-Ended
Credit Quality		Mar-14		Dec-13		Sep-13		Jun-13		Mar-13		Dec-13
Nonperforming loans and leases/total loans and leases (7)		1.11%		1.22%		1.38%		1.28%		1.24%		1.22%
Nonperforming assets/total assets		0.81%		0.87%		1.00%		0.89%		0.83%		0.87%
Allowance for originated loan and lease losses/total originated loans and leases		1.04%		1.06%		1.06%		1.08%		1.11%		1.06%
Allowance/nonperforming loans and leases		78.88%		71.65%		61.20%		64.99%		66.16%		71.65%
Net loan and lease losses (recoveries) annualized/total average loans and leases		0.09%		(0.12%)		0.14%		0.22%		0.14%		0.09%
Capital Adequacy (period-end)
Tier 1 capital / average assets		8.68%		8.52%		8.37%		8.16%		8.11%		8.52%
Total capital / risk-weighted assets		13.68%		13.42%		13.32%		13.34%		12.93%		13.42%
Tangible common equity / tangible assets		7.38%		7.11%		6.92%		6.65%		6.87%		7.11%
Profitability
Return on average assets *		1.02%		1.15%		1.10%		0.89%		0.95%		1.03%
Return on average equity *		10.88%		12.62%		12.83%		9.87%		10.53%		11.47%
Net interest margin (TE) *		3.60%		3.78%		3.63%		3.58%		3.57%		3.65%
* Quarterly ratios have been annualized
Non-GAAP Disclosure
Reported noninterest income (GAAP)	$	17,434	$	17,439	$	18,528	$	16,541	$	17,390	$	69,898
Adjustments (pre-tax):
Gain on redemption of trust preferred		0		0		(1,410)		0		0		(1,410)
Gain on deposit conversion		0		(1,285)		0		0		0		(1,285)
Noninterest income (Non-GAAP)	$	17,434	$	16,154	$	17,118	$	16,541	$	17,390	$	67,203
Non-GAAP Disclosure
Reported net income (GAAP)	$	12,569	$	14,290	$	14,049	$	11,007	$	11,510	$	50,856
Adjustments (net of tax):
Merger related expenses		0		0		0		22		118		140
Gain on redemption of trust preferred		0		0		(846)		0		0		(846)
Gain on deposit conversion		0		(771)		0		0		0		(771)
Subtotal adjustments		0		(771)		(846)		22		118		(1,477)
Net operating income (Non-GAAP)		12,569		13,519		13,203		11,029		11,628		49,379
Adjusted diluted earnings per share (Non-GAAP) (9)	$	0.84	$	0.91	$	0.89	$	0.75	$	0.80	$	3.36

Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued
Non-GAAP Disclosure		Quarter-Ended									Year-Ended
		Mar-14		Dec-13		Sep-13		Jun-13		Mar-13		Dec-13
Reported net income (GAAP)	$	12,569	$	14,290	$	14,049	$	11,007	$	11,510	$	50,856
Merger related expenses (net of tax)		0		0		0		22		118		140
Gain on redemption of trust preferred (net of tax)		0		0		(846)		0		0		(846)
Gain on deposit conversion		0		(771)		0		0		0		(771)
Net operating income (Non-GAAP)	$	12,569	$	13,519	$	13,203	$	11,029	$	11,628	$	49,379
Amortization of intangibles (net of tax)		316		329		327		328		334		1,318
Adjusted net operating income (Non-GAAP)		12,885		13,848		13,530		11,357		11,962		50,697
Average total shareholders' equity		468,515		449,445		434,482		447,088		443,277		443,565
Less:  Average goodwill and intangibles		108,437		108,729		109,277		110,037		110,687		109,676
Average tangible shareholders' equity (Non-GAAP)		360,078		340,716		325,205		337,051		332,590		333,889
Adjusted operating return on shareholders' tangible equity (annualized) (Non-GAAP)		14.51%		16.13%		16.51%		13.52%		14.59%		15.18%
Non-GAAP Disclosure
Total shareholders' equity (GAAP)	$	473,822	$	457,939	$	444,276	$	431,894	$	446,812	$	457,939
Less:  goodwill and intangibles		108,250		108,438		108,981		109,540		110,314		108,438
Tangible shareholders' equity		365,572		349,501		335,295		322,354		336,498		349,501
Ending shares outstanding		14,829,007		14,749,097		14,692,671		14,599,558		14,447,017		14,749,097
Tangible book value per share (Non-GAAP)		24.65		23.70		22.82		22.08		23.29		23.70

(1) Federal Reserve peer ratio as of December 31, 2013, includes banks and bank holding companies with consolidated assets between $3 billion and $10 billion.

(2) "Originated" equals loans and leases not included by definition in "acquired loans."

(3)"Acquired Loans and Leases" equals loans and leases acquired at fair value, accounted for in accordance with FASB ASC Topic 805.  "Covered Loans" are loans for which the Company will share losses with the FDIC and consist of loans VIST Bank acquired as part of an FDIC-assisted transaction during the fourth quarter of 2010.

(4) Average balances and yields on available-for-sale securities are based on historical amortized cost.

(5) Interest income includes the tax effects of taxable-equivalent basis.

(6) Nonaccrual loans are included in the average asset totals presented above.  Payments received on nonaccrual loans have been recognized as disclosed in Note 1 of the Company's consolidated financial statements included in Part I of the Company's annual report on Form 10-K for the fiscal year ended December 31, 2013.

(7) Certain acquired loans and leases that are past due are not on nonaccrual and are not included in nonperforming loans.  The risk of credit loss on these loans has been considered by virtue of the Corporation's estimate of acquisition-date fair value and these loans are considered accruing as the Corporation primarily recognizes interest income through accretion of the difference between the carrying value of these loans and their expected cash flows.  

(8) Includes all other real estate owned, including those balances acquired through business combinations.

(9)Earnings per share year-to-date may not equal the sum of the quarterly earnings per share as a result of rounding of average shares.