Exhibit 99(a)
 | News Release |
5 Sarnowski Drive, Glenville, New York, 12302
(518) 377-3311
Subsidiary: Trustco Bank | NASDAQ -- TRST |
| Contact: | Robert Leonard |
Executive Vice President and
Chief Risk Officer
(518) 381-3693
FOR IMMEDIATE RELEASE:
TrustCo Reports Historic First Quarter 2022 Earnings;
Net Income of $17.1 Million up 21.3% over the prior year quarter
Glenville, New York – April 21, 2022
TrustCo Bank Corp NY (TrustCo, NASDAQ: TRST) today announced historic earnings which sets the tone for 2022. First quarter net income was $17.1 million or $0.890 diluted earnings per share, compared to net income of $14.1 million or $0.730 diluted earnings per share for the first quarter 2021. Average residential loans, our primary lending focus, were up $218.6 million, or 5.8%, and average deposits were up $223.4 million or 4.4% for the first quarter 2022 over the same period a year earlier.
Overview
Robert J. McCormick, Chairman, President and Chief Executive Officer said “The most meaningful success is that which is sustained over the long-term. TrustCo’s tried and true approach to banking and the resulting strongly-liquid balance sheet has us well positioned as rates increase. TrustCo today announces, as it has many times before, that loan growth is up, deposits are up, credit quality remains solid, and expenses are down. In other words, we are sustaining financial performance that makes us ever stronger and more efficient. The Company continues to grow shareholder equity and stands proudly atop its 120-year history as part of the foundation upon which the communities we serve are built. This performance is the result of sound strategy, consistently applied against our ever-present commitment to paying a dependable and meaningful dividend to our owners.”
Details
Average loans were up $195.2 million or 4.6% in the first quarter 2022 over the same period in 2021. Average residential loans, our primary lending focus, were up $218.6 million, or 5.8%, in the first quarter 2022 over the same period in 2021. Average deposits were up $223.4 million or 4.4% for the first quarter 2022 over the same period a year earlier. The increase in deposits during the first quarter of 2022 was the result of a $521.2 million or 13.7% increase in total average core deposit accounts, which consist of interest bearing and non-interest bearing checking, savings and money market deposits, offset by a decrease in average time deposits of $297.8 million or 23.6%, for the first quarter 2022 over the same period in 2021. Within average core deposits, checking balances were up $242.2 million or 13.8% (including interest bearing and non-interest bearing checking balances), money market balances were up $66.1 million or 9.1%, and savings balances were up $212.9 million or 16.2%. We believe the increase in core deposits continues to reflect the desire of customers to have additional funds in the safety and security offered by TrustCo’s long history of conservative banking. As we move forward, the objective is to encourage customers to retain these additional funds in the expanded product offerings of the Bank through aggressive marketing and product differentiation. As of March 31, 2022, there were no pandemic related loans in deferral and 87 Paycheck Protection Program (“PPP”) loans totaling approximately $3 million remain outstanding.
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The cost of interest bearing liabilities decreased to 0.10% in the first quarter 2022 from 0.21% in the first quarter 2021. A significant portion of our CD portfolio (time deposits) repriced during the last year, which resulted in lower rates due to ongoing market conditions. The net interest margin for the first quarter 2022 was 2.66%, down 3 basis points from 2.69% in the fourth quarter of 2021, and down 12 basis points from 2.78% in the first quarter of 2021. Net interest income (TE) was relatively flat over the same period as last year.
TrustCo continued to demonstrate its ability to grow shareholders’ equity as average equity was up $26.8 million or 4.7% in the first quarter of 2022 compared to the same period in 2021. Return on average assets and return on average equity for the first quarter 2022 were 1.12% and 11.60%, respectively, compared to 0.96% and 10.01% for the first quarter 2021. Improving efficiencies to reduce costs continues to remain a key area of focus. Salaries and benefits expense decreased $3.2 million over the same period in the prior year as a result of a true-up to the incentive compensation accrual upon payout in the first quarter of 2022, as well as decreases in various other employee benefit plan expenses. We do expect salaries and benefits expense to return to historical levels in future quarters. The Bank also purchased 18 thousand shares of stock in the first quarter of 2022 under the previously announced stock repurchase plan. As discussed in prior quarters, on May 28, 2021, a Reverse Stock Split of the Company’s Common Stock at a ratio of 1 for 5 was implemented. For all periods presented share and per share information, and common stock and surplus amounts have been split adjusted. The Board of Directors believes that the higher per share trading price that resulted from the Reverse Stock Split will generate greater investor interest in TrustCo and improve the marketability of the shares to a broader range of investors. The Board of Directors also believes that the Reverse Stock Split has resulted in the number of our shares of outstanding common stock that is similar to the number of outstanding shares of common stock of comparable financial institutions.
Asset quality and loan loss reserve measures have continued to improve as a result of low levels of nonperforming assets and chargeoffs. Nonperforming loans (NPLs) were $19.4 million at March 31, 2022, compared to $21.6 million at March 31, 2021. NPLs were 0.43% and 0.51% of total loans at March 31, 2022 and 2021, respectively. The coverage ratio, or allowance for credit losses on loans to NPLs, was 237.8% at March 31, 2022, compared to 231.1% at March 31, 2021. Nonperforming assets (NPAs) were $19.7 million at March 31, 2022, compared to $22.1 million at March 31, 2021. The Company adopted Accounting Standards Update 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“CECL”) effective January 1, 2022. TrustCo recorded a net decrease to retained earnings of $3.5 million upon adoption of the new accounting standard. The transition adjustment at January 1, 2022 included a $2.4 million increase in the allowance for credit losses on loans, a $2.3 million increase in the allowance for estimated credit losses on unfunded off-balance sheet credit exposures, and a corresponding increase in deferred tax assets of $1.2 million. The Company recorded a credit to provision for credit losses of $200 thousand, which includes a credit to provision for credit losses on loans of $500 thousand as a result of improving unemployment and housing price forecasts, offset by a provision for credit losses on unfunded commitments of $300 thousand as a result of a corresponding increase in unfunded loans. The allowance for credit losses on loans was $46.2 million at March 31, 2022, compared to $50.0 million at March 31, 2021. The ratio of allowance for credit losses on loans to total loans was 1.03% as of March 31, 2022 compared to 1.17% as of March 31, 2021.
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Net recoveries for the first quarter 2022 were $58 thousand versus net recoveries in the first quarter 2021 of $46 thousand. The annualized net (recoveries) chargeoffs ratio was (0.01)% for the first quarter 2022 versus 0.00% in the first quarter of 2021.
At both March 31, 2022 and 2021 the equity to asset ratio was 9.44%. Book value per share at March 31, 2022 was $30.85, up 4.2% compared to $29.60 a year earlier.
TrustCo Bank Corp NY is a $6.3 billion savings and loan holding company and through its subsidiary, Trustco Bank, operated 144 offices in New York, New Jersey, Vermont, Massachusetts, and Florida at March 31, 2022.
In addition, the Bank’s Financial Services Department offers a full range of investment services, retirement planning and trust and estate administration services. The common shares of TrustCo are traded on the NASDAQ Global Select Market under the symbol TRST.
Those wishing to participate in the call may dial toll-free for the United States at 1-844-200-6205, for Canada at 1-833-950-0062, and all other locations at 1-929-526-1599, Access code 630692. A replay of the call will be available for thirty days by dialing toll-free for the United States at 1-866-813-9403, for Canada at 1-226-828-7578, and all other locations at +44-204-525-0658, Access code 640611. The call will also be audio webcast at https://events.q4inc.com/attendee/372562324, and will be available for one year.
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Safe Harbor Statement
All statements in this news release that are not historical are forward-looking statements within the meaning of the Securities Exchange Act of 1934, as amended. Forward-looking statements can be identified by words such as "anticipate," "intend," "plan," "goal," "seek," "believe," "project," "estimate," "expect," "strategy," "future," "likely," "may," "should," "will" and similar references to future periods. Examples of forward-looking statements include, among others, statements we make regarding our expectations for our performance during 2022, including our expectations regarding the effects of the economic environment on our financial results, our ability to retain customers and the amount of customers’ business, including deposit balances, with us, the impact of Federal Reserve actions regarding interest rates and the growth of loans and deposits throughout our branch network and our ability to capitalize on economic changes in the areas in which we operate. Such forward-looking statements are subject to factors that could cause actual results to differ materially for TrustCo from those discussed, and many of the risks and uncertainties are heightened by or may, in the future, be heightened by the effects of the COVID-19 pandemic and macroeconomic or geopolitical concerns related to inflation, rising interest rates and the war in Ukraine. TrustCo wishes to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The following important factors, among others, in some cases have affected and in the future could affect TrustCo’s actual results and could cause TrustCo’s actual financial performance to differ materially from that expressed in any forward-looking statement: the effects of inflation and inflationary pressures and changes in monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board; the impact of the actions taken by governmental authorities to contain the COVID-19 pandemic or address the impact of the pandemic on the economy, and the effect of all of such items on our operations, liquidity and capital position, and on the financial condition of our borrowers and other customers; changes in and uncertainty related to benchmark interest rates used to price loans and deposits; future business strategies related to the implementation of CECL; credit risks and risks from concentrations (by geographic area and by loan product) within our loan portfolio; changes in local market areas and general business and economic trends, as well as changes in consumer spending and savings habits; and our ability to assess and react effectively to such changes; our ability to continue to originate a significant volume of one-to-four family mortgage loans in our market areas; our ability to continue to maintain noninterest expense and other overhead costs at reasonable levels relative to income; our ability to make accurate assumptions and judgments regarding the credit risks associated with lending and investing activities; restrictions or conditions imposed by our regulators on our operations that may make it more difficult for us to achieve our goals; the future earnings and capital levels of us and Trustco Bank and the continued receipt of approvals from our primary federal banking regulators under regulatory rules to distribute capital to TrustCo, which could affect our ability to pay dividends; results of supervisory monitoring or examinations of Trustco Bank and TrustCo by our respective regulators; adverse conditions in the securities markets that lead to impairment in the value of securities in our investment portfolio; the perceived overall value of our products and services by users, including in comparison to competitors’ products and services and the willingness of current and prospective customers to substitute competitors’ products and services for our products and services; changes in consumer spending, borrowing and saving habits; the effect of changes in financial services laws and regulations and the impact of other governmental initiatives affecting the financial services industry; changes in management personnel; real estate and collateral values; changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the FASB or PCAOB; disruptions, security breaches, or other adverse events affecting the third-party vendors who perform several of our critical processing functions; technological changes and electronic, cyber and physical security breaches; our success at managing the risks involved in the foregoing and managing our business; and other risks and uncertainties under the heading “Risk Factors” in our most recent annual report on Form 10-K and, if any, in our subsequent quarterly reports on Form 10-Q or other securities filings.
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TRUSTCO BANK CORP NY
GLENVILLE, NY
FINANCIAL HIGHLIGHTS
(dollars in thousands, except per share data)
(Unaudited)
| Three months ended | ||||||||||||
| 3/31/2022 | 12/31/2021 | 3/31/2021 | ||||||||||
| Summary of operations | ||||||||||||
| Net interest income (TE) | $ | 40,096 | 40,292 | 40,107 | ||||||||
| (Credit) Provision for credit losses | (200 | ) | (3,000 | ) | 350 | |||||||
| Noninterest income | 5,183 | 4,526 | 4,428 | |||||||||
| Noninterest expense | 22,765 | 26,190 | 25,335 | |||||||||
| Net income | 17,089 | 16,241 | 14,083 | |||||||||
| Per share (4) | ||||||||||||
| Net income per share: | ||||||||||||
| - Basic | $ | 0.890 | 0.845 | 0.730 | ||||||||
| - Diluted | 0.890 | 0.845 | 0.730 | |||||||||
| Cash dividends | 0.350 | 0.350 | 0.341 | |||||||||
| Book value at period end | 30.85 | 31.28 | 29.60 | |||||||||
| Market price at period end | 31.93 | 33.31 | 36.85 | |||||||||
| At period end | ||||||||||||
| Full time equivalent employees | 769 | 759 | 820 | |||||||||
| Full service banking offices | 144 | 147 | 148 | |||||||||
| Performance ratios | ||||||||||||
| Return on average assets | 1.12 | % | 1.05 | 0.96 | ||||||||
| Return on average equity | 11.60 | 10.92 | 10.01 | |||||||||
| Efficiency (1) | 50.55 | 58.50 | 56.35 | |||||||||
| Net interest spread (TE) | 2.63 | 2.67 | 2.74 | |||||||||
| Net interest margin (TE) | 2.66 | 2.69 | 2.78 | |||||||||
| Dividend payout ratio | 39.36 | 41.42 | 46.65 | |||||||||
| Capital ratios at period end | ||||||||||||
| Consolidated tangible equity to tangible assets (2) | 9.43 | % | 9.69 | 9.44 | ||||||||
| Consolidated equity to assets | 9.44 | % | 9.70 | 9.44 | ||||||||
| Asset quality analysis at period end | ||||||||||||
| Nonperforming loans to total loans | 0.43 | 0.42 | 0.51 | |||||||||
| Nonperforming assets to total assets | 0.31 | 0.31 | 0.36 | |||||||||
| Allowance for credit losses on loans to total loans | 1.03 | 1.00 | 1.17 | |||||||||
| Coverage ratio (3) | 2.4 | x | 2.4 | x | 2.3 | x | ||||||
| (1) | Non-GAAP measure; calculated as noninterest expense (excluding ORE income/expense) divided by taxable equivalent net interest income plus noninterest income. |
| (2) | Non-GAAP measure; calculated as total equity less $553 of intangible assets divided by total assets less $553 of intangible assets. |
| (3) | Calculated as allowance for credit losses on loans divided by total nonperforming loans. |
| (4) | All periods presented have been adjusted for the 1 for 5 reverse stock split which occurred on May 28, 2021. |
TE = Taxable equivalent
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(dollars in thousands, except per share data)
(Unaudited)
| Three months ended | ||||||||||||||||||||
| 3/31/2022 | 12/31/2021 | 9/30/2021 | 6/30/2021 | 3/31/2021 | ||||||||||||||||
| Interest and dividend income: | ||||||||||||||||||||
| Interest and fees on loans | $ | 39,003 | 39,655 | 39,488 | 39,808 | 40,217 | ||||||||||||||
| Interest and dividends on securities available for sale: | ||||||||||||||||||||
| U. S. government sponsored enterprises | 86 | 76 | 91 | 97 | 50 | |||||||||||||||
| State and political subdivisions | 1 | - | 1 | - | 1 | |||||||||||||||
Mortgage-backed securities and collateralized mortgage obligations - residential | 1,087 | 1,073 | 1,038 | 1,167 | 1,237 | |||||||||||||||
| Corporate bonds | 233 | 206 | 220 | 323 | 316 | |||||||||||||||
Small Business Administration - guaranteed participation securities | 154 | 165 | 181 | 193 | 206 | |||||||||||||||
| Other securities | 2 | 4 | 5 | 5 | 6 | |||||||||||||||
| Total interest and dividends on securities available for sale | 1,563 | 1,524 | 1,536 | 1,785 | 1,816 | |||||||||||||||
| Interest on held to maturity securities: | ||||||||||||||||||||
Mortgage-backed securities and collateralized mortgage obligations - residential | 90 | 97 | 104 | 111 | 123 | |||||||||||||||
| Total interest on held to maturity securities | 90 | 97 | 104 | 111 | 123 | |||||||||||||||
| Federal Reserve Bank and Federal Home Loan Bank stock | 62 | 62 | 64 | 65 | 69 | |||||||||||||||
| Interest on federal funds sold and other short-term investments | 572 | 432 | 470 | 286 | 270 | |||||||||||||||
| Total interest income | 41,290 | 41,770 | 41,662 | 42,055 | 42,495 | |||||||||||||||
| Interest expense: | ||||||||||||||||||||
| Interest on deposits: | ||||||||||||||||||||
| Interest-bearing checking | 44 | 42 | 38 | 46 | 52 | |||||||||||||||
| Savings | 156 | 149 | 154 | 162 | 159 | |||||||||||||||
| Money market deposit accounts | 214 | 201 | 202 | 236 | 283 | |||||||||||||||
| Time deposits | 546 | 865 | 1,149 | 1,261 | 1,666 | |||||||||||||||
| Interest on short-term borrowings | 234 | 221 | 232 | 228 | 228 | |||||||||||||||
| Total interest expense | 1,194 | 1,478 | 1,775 | 1,933 | 2,388 | |||||||||||||||
| Net interest income | 40,096 | 40,292 | 39,887 | 40,122 | 40,107 | |||||||||||||||
| Less: (Credit) Provision for credit losses | (200 | ) | (3,000 | ) | (2,800 | ) | - | 350 | ||||||||||||
| Net interest income after provision for loan losses | 40,296 | 43,292 | 42,687 | 40,122 | 39,757 | |||||||||||||||
| Noninterest income: | ||||||||||||||||||||
| Trustco Financial Services income | 1,833 | 1,766 | 1,558 | 1,999 | 2,035 | |||||||||||||||
| Fees for services to customers | 2,801 | 2,578 | 2,531 | 2,486 | 2,204 | |||||||||||||||
| Other | 549 | 182 | 206 | 203 | 189 | |||||||||||||||
| Total noninterest income | 5,183 | 4,526 | 4,295 | 4,688 | 4,428 | |||||||||||||||
| Noninterest expenses: | ||||||||||||||||||||
| Salaries and employee benefits | 9,239 | 11,984 | 11,909 | 12,403 | 12,425 | |||||||||||||||
| Net occupancy expense | 4,529 | 4,569 | 4,259 | 4,328 | 4,586 | |||||||||||||||
| Equipment expense | 1,588 | 1,758 | 1,628 | 1,600 | 1,631 | |||||||||||||||
| Professional services | 1,467 | 1,579 | 1,483 | 1,614 | 1,432 | |||||||||||||||
| Outsourced services | 2,280 | 1,950 | 2,015 | 2,169 | 2,250 | |||||||||||||||
| Advertising expense | 617 | 762 | 310 | 549 | 354 | |||||||||||||||
| FDIC and other insurance | 812 | 780 | 746 | 777 | 707 | |||||||||||||||
| Other real estate expense (income), net | 11 | (28 | ) | 32 | (60 | ) | 239 | |||||||||||||
| Other | 2,222 | 2,836 | 2,315 | 2,060 | 1,711 | |||||||||||||||
| Total noninterest expenses | 22,765 | 26,190 | 24,697 | 25,440 | 25,335 | |||||||||||||||
| Income before taxes | 22,714 | 21,628 | 22,285 | 19,370 | 18,850 | |||||||||||||||
| Income taxes | 5,625 | 5,387 | 5,523 | 4,937 | 4,767 | |||||||||||||||
| Net income | $ | 17,089 | 16,241 | 16,762 | 14,433 | 14,083 | ||||||||||||||
| Net income per common share (1): | ||||||||||||||||||||
| - Basic | $ | 0.890 | 0.845 | 0.871 | 0.749 | 0.730 | ||||||||||||||
| - Diluted | 0.890 | 0.845 | 0.871 | 0.748 | 0.730 | |||||||||||||||
| Average basic shares (in thousands) | 19,209 | 19,216 | 19,249 | 19,281 | 19,287 | |||||||||||||||
| Average diluted shares (in thousands) | 19,210 | 19,218 | 19,252 | 19,290 | 19,293 | |||||||||||||||
| Note: Taxable equivalent net interest income | $ | 40,096 | 40,292 | 39,888 | 40,122 | 40,107 | ||||||||||||||
| (1) | All periods presented have been adjusted for the 1 for 5 reverse stock split which occurred on May 28, 2021. |
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CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(dollars in thousands)
(Unaudited)
| 3/31/2022 | 12/31/2021 | 9/30/2021 | 6/30/2021 | 3/31/2021 | ||||||||||||||||
| ASSETS: | ||||||||||||||||||||
| Cash and due from banks | $ | 47,526 | 48,357 | 45,486 | 47,766 | 45,493 | ||||||||||||||
| Federal funds sold and other short term investments | 1,225,022 | 1,171,113 | 1,147,853 | 1,134,622 | 1,094,880 | |||||||||||||||
| Total cash and cash equivalents | 1,272,548 | 1,219,470 | 1,193,339 | 1,182,388 | 1,140,373 | |||||||||||||||
| Securities available for sale: | ||||||||||||||||||||
| U. S. government sponsored enterprises | 62,059 | 59,179 | 59,749 | 74,579 | 74,465 | |||||||||||||||
| States and political subdivisions | 41 | 41 | 48 | 48 | 48 | |||||||||||||||
Mortgage-backed securities and collateralized mortgage obligations - residential | 244,045 | 270,798 | 293,585 | 315,656 | 348,317 | |||||||||||||||
Small Business Administration - guaranteed participation securities | 28,086 | 31,674 | 34,569 | 37,199 | 39,232 | |||||||||||||||
| Corporate bonds | 74,089 | 45,337 | 45,915 | 54,647 | 64,839 | |||||||||||||||
| Other securities | 671 | 684 | 686 | 686 | 686 | |||||||||||||||
| Total securities available for sale | 408,991 | 407,713 | 434,552 | 482,815 | 527,587 | |||||||||||||||
| Held to maturity securities: | ||||||||||||||||||||
Mortgage-backed securities and collateralized mortgage obligations-residential | 9,183 | 9,923 | 10,701 | 11,665 | 12,729 | |||||||||||||||
| Total held to maturity securities | 9,183 | 9,923 | 10,701 | 11,665 | 12,729 | |||||||||||||||
| Federal Reserve Bank and Federal Home Loan Bank stock | 5,604 | 5,604 | 5,604 | 5,604 | 5,506 | |||||||||||||||
| Loans: | ||||||||||||||||||||
| Commercial | 192,408 | 200,200 | 204,679 | 214,164 | 217,021 | |||||||||||||||
| Residential mortgage loans | 4,026,434 | 3,998,187 | 3,951,285 | 3,892,351 | 3,807,837 | |||||||||||||||
| Home equity line of credit | 236,117 | 230,976 | 231,314 | 234,214 | 235,644 | |||||||||||||||
| Installment loans | 9,395 | 9,416 | 9,451 | 8,638 | 8,670 | |||||||||||||||
| Loans, net of deferred net costs | 4,464,354 | 4,438,779 | 4,396,729 | 4,349,367 | 4,269,172 | |||||||||||||||
| Less: Allowance for credit losses on loans | 46,178 | 44,267 | 47,350 | 50,155 | 49,991 | |||||||||||||||
| Net loans | 4,418,176 | 4,394,512 | 4,349,379 | 4,299,212 | 4,219,181 | |||||||||||||||
| Bank premises and equipment, net | 32,644 | 33,027 | 33,233 | 33,691 | 34,012 | |||||||||||||||
| Operating lease right-of-use assets | 48,569 | 48,090 | 45,836 | 45,825 | 46,614 | |||||||||||||||
| Other assets | 86,158 | 78,207 | 62,191 | 61,378 | 60,455 | |||||||||||||||
| Total assets | $ | 6,281,873 | 6,196,546 | 6,134,835 | 6,122,578 | 6,046,457 | ||||||||||||||
| LIABILITIES: | ||||||||||||||||||||
| Deposits: | ||||||||||||||||||||
| Demand | $ | 835,281 | 794,878 | 790,663 | 765,193 | 718,343 | ||||||||||||||
| Interest-bearing checking | 1,225,093 | 1,191,304 | 1,148,593 | 1,152,901 | 1,141,595 | |||||||||||||||
| Savings accounts | 1,553,152 | 1,504,554 | 1,433,130 | 1,409,556 | 1,362,141 | |||||||||||||||
| Money market deposit accounts | 796,275 | 782,079 | 744,051 | 732,963 | 719,580 | |||||||||||||||
| Time deposits | 940,215 | 995,314 | 1,124,581 | 1,169,907 | 1,231,263 | |||||||||||||||
| Total deposits | 5,350,016 | 5,268,129 | 5,241,018 | 5,230,520 | 5,172,922 | |||||||||||||||
| Short-term borrowings | 248,371 | 244,686 | 230,770 | 237,791 | 229,950 | |||||||||||||||
| Operating lease liabilities | 53,094 | 52,720 | 50,515 | 50,586 | 51,449 | |||||||||||||||
| Accrued expenses and other liabilities | 37,497 | 29,883 | 25,849 | 25,088 | 21,105 | |||||||||||||||
| Total liabilities | 5,688,978 | 5,595,418 | 5,548,152 | 5,543,985 | 5,475,426 | |||||||||||||||
| SHAREHOLDERS' EQUITY: | ||||||||||||||||||||
| Capital stock (1) | 20,046 | 20,046 | 20,042 | 20,041 | 20,044 | |||||||||||||||
| Surplus (1) | 256,661 | 256,661 | 256,565 | 256,536 | 256,674 | |||||||||||||||
| Undivided profits | 355,948 | 349,056 | 339,554 | 329,350 | 321,486 | |||||||||||||||
| Accumulated other comprehensive (loss) income, net of tax | (2,369 | ) | 12,147 | 7,304 | 7,840 | 7,268 | ||||||||||||||
| Treasury stock at cost | (37,391 | ) | (36,782 | ) | (36,782 | ) | (35,174 | ) | (34,441 | ) | ||||||||||
| Total shareholders' equity | 592,895 | 601,128 | 586,683 | 578,593 | 571,031 | |||||||||||||||
| Total liabilities and shareholders' equity | $ | 6,281,873 | 6,196,546 | 6,134,835 | 6,122,578 | 6,046,457 | ||||||||||||||
| Outstanding shares (in thousands) | 19,202 | 19,220 | 19,216 | 19,265 | 19,288 | |||||||||||||||
| (1) | All periods presented have been adjusted for the 1 for 5 reverse stock split which occurred on May 28, 2021. |
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(dollars in thousands)
(Unaudited)
| 3/31/2022 | 12/31/2021 | 9/30/2021 | 6/30/2021 | 3/31/2021 | ||||||||||||||||
| Nonperforming Assets | ||||||||||||||||||||
| New York and other states* | ||||||||||||||||||||
| Loans in nonaccrual status: | ||||||||||||||||||||
| Commercial | $ | 187 | 112 | 176 | 150 | 125 | ||||||||||||||
| Real estate mortgage - 1 to 4 family | 17,065 | 16,574 | 17,878 | 18,466 | 19,826 | |||||||||||||||
| Installment | 33 | 37 | 32 | 43 | 32 | |||||||||||||||
| Total non-accrual loans | 17,285 | 16,723 | 18,086 | 18,659 | 19,983 | |||||||||||||||
| Other nonperforming real estate mortgages - 1 to 4 family | 16 | 17 | 19 | 20 | 22 | |||||||||||||||
| Total nonperforming loans | 17,301 | 16,740 | 18,105 | 18,679 | 20,005 | |||||||||||||||
| Other real estate owned | 269 | 362 | 511 | 251 | 420 | |||||||||||||||
| Total nonperforming assets | $ | 17,570 | 17,102 | 18,616 | 18,930 | 20,425 | ||||||||||||||
| Florida | ||||||||||||||||||||
| Loans in nonaccrual status: | ||||||||||||||||||||
| Commercial | $ | - | - | - | - | - | ||||||||||||||
| Real estate mortgage - 1 to 4 family | 2,109 | 2,016 | 2,066 | 2,142 | 1,626 | |||||||||||||||
| Installment | 8 | - | - | - | - | |||||||||||||||
| Total non-accrual loans | 2,117 | 2,016 | 2,066 | 2,142 | 1,626 | |||||||||||||||
| Other nonperforming real estate mortgages - 1 to 4 family | - | - | - | - | - | |||||||||||||||
| Total nonperforming loans | 2,117 | 2,016 | 2,066 | 2,142 | 1,626 | |||||||||||||||
| Other real estate owned | - | - | - | - | - | |||||||||||||||
| Total nonperforming assets | $ | 2,117 | 2,016 | 2,066 | 2,142 | 1,626 | ||||||||||||||
| Total | ||||||||||||||||||||
| Loans in nonaccrual status: | ||||||||||||||||||||
| Commercial | $ | 187 | 112 | 176 | 150 | 125 | ||||||||||||||
| Real estate mortgage - 1 to 4 family | 19,174 | 18,590 | 19,944 | 20,608 | 21,452 | |||||||||||||||
| Installment | 41 | 37 | 32 | 43 | 32 | |||||||||||||||
| Total non-accrual loans | 19,402 | 18,739 | 20,152 | 20,801 | 21,609 | |||||||||||||||
| Other nonperforming real estate mortgages - 1 to 4 family | 16 | 17 | 19 | 20 | 22 | |||||||||||||||
| Total nonperforming loans | 19,418 | 18,756 | 20,171 | 20,821 | 21,631 | |||||||||||||||
| Other real estate owned | 269 | 362 | 511 | 251 | 420 | |||||||||||||||
| Total nonperforming assets | $ | 19,687 | 19,118 | 20,682 | 21,072 | 22,051 | ||||||||||||||
| Quarterly Net (Recoveries) Chargeoffs | ||||||||||||||||||||
| New York and other states* | ||||||||||||||||||||
| Commercial | $ | 36 | - | 30 | - | (32 | ) | |||||||||||||
| Real estate mortgage - 1 to 4 family | (97 | ) | 52 | (39 | ) | (136 | ) | (2 | ) | |||||||||||
| Installment | 3 | 31 | 14 | (27 | ) | (14 | ) | |||||||||||||
| Total net (recoveries) chargeoffs | $ | (58 | ) | 83 | 5 | (163 | ) | (48 | ) | |||||||||||
| Florida | ||||||||||||||||||||
| Commercial | $ | - | - | - | - | - | ||||||||||||||
| Real estate mortgage - 1 to 4 family | - | - | - | (1 | ) | - | ||||||||||||||
| Installment | - | - | - | - | 2 | |||||||||||||||
| Total net (recoveries) chargeoffs | $ | - | - | - | (1 | ) | 2 | |||||||||||||
| Total | ||||||||||||||||||||
| Commercial | $ | 36 | - | 30 | - | (32 | ) | |||||||||||||
| Real estate mortgage - 1 to 4 family | (97 | ) | 52 | (39 | ) | (137 | ) | (2 | ) | |||||||||||
| Installment | 3 | 31 | 14 | (27 | ) | (12 | ) | |||||||||||||
| Total net (recoveries) chargeoffs | $ | (58 | ) | 83 | 5 | (164 | ) | (46 | ) | |||||||||||
| Asset Quality Ratios | ||||||||||||||||||||
| Total nonperforming loans (1) | $ | 19,418 | 18,756 | 20,171 | 20,821 | 21,631 | ||||||||||||||
| Total nonperforming assets (1) | 19,687 | 19,118 | 20,682 | 21,072 | 22,051 | |||||||||||||||
| Total net (recoveries) chargeoffs (2) | (58 | ) | 83 | 5 | (164 | ) | (46 | ) | ||||||||||||
| Allowance for credit losses on loans (1) | 46,178 | 44,267 | 47,350 | 50,155 | 49,991 | |||||||||||||||
| Nonperforming loans to total loans | 0.43 | % | 0.42 | % | 0.46 | % | 0.48 | % | 0.51 | % | ||||||||||
| Nonperforming assets to total assets | 0.31 | % | 0.31 | % | 0.34 | % | 0.34 | % | 0.36 | % | ||||||||||
| Allowance for credit losses on loans to total loans | 1.03 | % | 1.00 | % | 1.08 | % | 1.15 | % | 1.17 | % | ||||||||||
| Coverage ratio (1) | 237.8 | % | 236.0 | % | 234.7 | % | 240.9 | % | 231.1 | % | ||||||||||
| Annualized net (recoveries) chargeoffs to average loans (2) | -0.01 | % | 0.01 | % | 0.00 | % | -0.02 | % | 0.00 | % | ||||||||||
| Allowance for credit losses on loans to annualized net (recoveries) chargeoffs (2) | N/A | 133.3 | x | 2367.5 | x | N/A | N/A | |||||||||||||
* Includes New York, New Jersey, Vermont and Massachusetts.
| (1) | At period-end |
| (2) | For the period ended |
Page | 8
DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY -
INTEREST RATES AND INTEREST DIFFERENTIAL
| (dollars in thousands) | ||||||||||||||||||||||||
| (Unaudited) | Three months ended March 31, 2022 | Three months ended March 31, 2021 | ||||||||||||||||||||||
Average Balance | Interest | Average Rate | Average Balance | Interest | Average Rate | |||||||||||||||||||
| Assets | ||||||||||||||||||||||||
| Securities available for sale: | ||||||||||||||||||||||||
| U. S. government sponsored enterprises | $ | 61,755 | 86 | 0.55 | % | $ | 51,649 | 50 | 0.38 | % | ||||||||||||||
Mortgage backed securities and collateralized mortgage obligations - residential | 261,124 | 1,087 | 1.67 | 327,614 | 1,237 | 1.51 | ||||||||||||||||||
| State and political subdivisions | 41 | 1 | 6.73 | 50 | 1 | 6.47 | ||||||||||||||||||
| Corporate bonds | 52,977 | 233 | 1.76 | 63,334 | 316 | 1.99 | ||||||||||||||||||
Small Business Administration - guaranteed participation securities | 29,871 | 154 | 2.06 | 39,582 | 206 | 2.09 | ||||||||||||||||||
| Other | 686 | 2 | 1.17 | 686 | 6 | 3.50 | ||||||||||||||||||
| Total securities available for sale | 406,454 | 1,563 | 1.54 | 482,915 | 1,816 | 1.50 | ||||||||||||||||||
| Federal funds sold and other short-term Investments | 1,187,201 | 572 | 0.20 | 1,029,570 | 270 | 0.11 | ||||||||||||||||||
| Held to maturity securities: | ||||||||||||||||||||||||
Mortgage backed securities and collateralized mortgage obligations - residential | 9,541 | 90 | 3.79 | 13,273 | 123 | 3.70 | ||||||||||||||||||
| Total held to maturity securities | 9,541 | 90 | 3.79 | 13,273 | 123 | 3.70 | ||||||||||||||||||
| Federal Reserve Bank and Federal Home Loan Bank stock | 5,604 | 62 | 4.43 | 5,506 | 69 | 5.01 | ||||||||||||||||||
| Commercial loans | 194,989 | 2,525 | 5.18 | 212,781 | 2,945 | 5.54 | ||||||||||||||||||
| Residential mortgage loans | 4,007,886 | 34,197 | 3.42 | 3,789,256 | 34,852 | 3.69 | ||||||||||||||||||
| Home equity lines of credit | 232,535 | 2,125 | 3.71 | 238,379 | 2,259 | 3.84 | ||||||||||||||||||
| Installment loans | 8,974 | 156 | 7.03 | 8,795 | 161 | 7.41 | ||||||||||||||||||
| Loans, net of unearned income | 4,444,384 | 39,003 | 3.52 | 4,249,211 | 40,217 | 3.80 | ||||||||||||||||||
| Total interest earning assets | 6,053,184 | 41,290 | 2.74 | 5,780,475 | 42,495 | 2.95 | ||||||||||||||||||
| Allowance for credit losses on loans | (46,759 | ) | (49,945 | ) | ||||||||||||||||||||
| Cash & non-interest earning assets | 207,308 | 199,769 | ||||||||||||||||||||||
| Total assets | $ | 6,213,733 | $ | 5,930,299 | ||||||||||||||||||||
| Liabilities and shareholders' equity | ||||||||||||||||||||||||
| Deposits: | ||||||||||||||||||||||||
| Interest bearing checking accounts | $ | 1,191,496 | 44 | 0.01 | % | $ | 1,084,572 | 52 | 0.02 | % | ||||||||||||||
| Money market accounts | 791,689 | 214 | 0.11 | 725,570 | 283 | 0.16 | ||||||||||||||||||
| Savings | 1,527,975 | 156 | 0.04 | 1,315,049 | 159 | 0.05 | ||||||||||||||||||
| Time deposits | 964,158 | 546 | 0.23 | 1,261,963 | 1,666 | 0.54 | ||||||||||||||||||
| Total interest bearing deposits | 4,475,318 | 960 | 0.09 | 4,387,154 | 2,160 | 0.20 | ||||||||||||||||||
| Short-term borrowings | 248,535 | 234 | 0.38 | 223,807 | 228 | 0.41 | ||||||||||||||||||
| Total interest bearing liabilities | 4,723,853 | 1,194 | 0.10 | 4,610,961 | 2,388 | 0.21 | ||||||||||||||||||
| Demand deposits | 808,695 | 673,428 | ||||||||||||||||||||||
| Other liabilities | 83,633 | 75,143 | ||||||||||||||||||||||
| Shareholders' equity | 597,552 | 570,767 | ||||||||||||||||||||||
| Total liabilities and shareholders' equity | $ | 6,213,733 | $ | 5,930,299 | ||||||||||||||||||||
| Net interest income, tax equivalent | 40,096 | 40,107 | ||||||||||||||||||||||
| Net interest spread | 2.63 | % | 2.74 | % | ||||||||||||||||||||
Net interest margin (net interest income to total interest earning assets) | 2.66 | % | 2.78 | % | ||||||||||||||||||||
| Tax equivalent adjustment | 0 | 0 | ||||||||||||||||||||||
| Net interest income | 40,096 | 40,107 | ||||||||||||||||||||||
Page | 9
Non-GAAP Financial Measures Reconciliation
Tangible equity as a percentage of tangible assets at period end is a non-GAAP financial measure derived from GAAP-based amounts. We calculate tangible equity and tangible assets by excluding the balance of intangible assets from shareholders’ equity and total assets, respectively. We calculate tangible equity as a percentage of tangible assets at period end by dividing tangible equity by tangible assets at period end. We believe that this is consistent with the treatment by bank regulatory agencies, which exclude intangible assets from the calculation of risk-based capital ratios.
The efficiency ratio is a non-GAAP measure of expense control relative to revenue from net interest income and fee income. We calculate the efficiency ratio by dividing total noninterest expenses as determined under GAAP, but excluding other real estate expense, net, by net interest income (fully taxable equivalent) and total noninterest income as determined under GAAP, but excluding net gains on the sale of securities and other non-routine items from this calculation. We believe that this provides a reasonable measure of primary banking expenses relative to primary banking revenue.
We believe that these non-GAAP financial measures provide information that is important to investors and that is useful in understanding our financial results. Our management internally assesses our performance based, in part, on these measures. However, these non-GAAP financial measures are supplemental and not a substitute for an analysis based on GAAP measures. As other companies may use different calculations for these measures, this presentation may not be comparable to other similarly titled measures reported by other companies. A reconciliation of the non-GAAP measures of tangible common equity, tangible book value per share, efficiency ratio, net income and net income per share to the underlying GAAP numbers is set forth below.
| (dollars in thousands, except per share amounts) | ||||||||||||
| (Unaudited) | ||||||||||||
| 3/31/2022 | 12/31/2021 | 3/31/2021 | ||||||||||
| Tangible Equity to Tangible Assets | ||||||||||||
| Total Assets (GAAP) | $ | 6,281,873 | 6,196,546 | 6,046,457 | ||||||||
| Less: Intangible assets | 553 | 553 | 553 | |||||||||
| Tangible assets (Non-GAAP) | 6,281,320 | 6,195,993 | 6,045,904 | |||||||||
| Equity (GAAP) | 592,895 | 601,128 | 571,031 | |||||||||
| Less: Intangible assets | 553 | 553 | 553 | |||||||||
| Tangible equity (Non-GAAP) | 592,342 | 600,575 | 570,478 | |||||||||
| Tangible Equity to Tangible Assets (Non-GAAP) | 9.43 | % | 9.69 | % | 9.44 | % | ||||||
| Equity to Assets (GAAP) | 9.44 | % | 9.70 | % | 9.44 | % | ||||||
| Three months ended | ||||||||||||
| Efficiency Ratio | 3/31/2022 | 12/31/2021 | 3/31/2021 | |||||||||
| Net interest income (fully taxable equivalent) (Non-GAAP) | $ | 40,096 | 40,292 | 40,107 | ||||||||
| Non-interest income (GAAP) | 5,183 | 4,526 | 4,428 | |||||||||
| Less: Net gain on sale of building | 268 | - | - | |||||||||
| Revenue used for efficiency ratio (Non-GAAP) | 45,011 | 44,818 | 44,535 | |||||||||
| Total noninterest expense (GAAP) | 22,765 | 26,190 | 25,335 | |||||||||
| Less: Other real estate expense (income), net | 11 | (28 | ) | 239 | ||||||||
| Expense used for efficiency ratio (Non-GAAP) | 22,754 | 26,218 | 25,096 | |||||||||
| Efficiency Ratio | 50.55 | % | 58.50 | % | 56.35 | % | ||||||
Page | 10