EXHIBIT 99.1
Chemung Financial Reports Record Earnings
ELMIRA, N.Y., Jan. 30, 2013 (GLOBE NEWSWIRE) -- Chemung Financial Corporation (Nasdaq:CHMG), the parent company of Chemung Canal Trust Company, reported year-to-date and quarter ended December 31, 2012, net income and earnings per share. Highlights for the current year and quarter include:
- Net income for the twelve months ended December 31, 2012, was $11.0 million, or $2.38 per share, compared with $10.5 million, or $2.40 per share, for the prior year, an increase of $0.5 million, or 4.6%. Net income for the fourth quarter of 2012 was $2.1 million, or $0.46 per share, compared with $3.0 million, or $0.64 per share, for the same quarter in the prior year.
- Net interest margin for the twelve months ended December 31, 2012, was 4.07%, level with the prior year. Net interest margin for the fourth quarter of 2012 was 3.98% compared with 4.04% for the preceding quarter and 4.19% for the fourth quarter in the prior year.
- Non-performing assets to total assets ratio declined to 0.89% at December 31, 2012, from 1.79% at December 31, 2011. Excluding $4.5 million in accruing loans that are 90 days or more past their stated maturity dates, the non-performing assets to total assets ratio was 0.53%.
- Capital remains strong as the tangible equity to tangible assets ratio was 8.53% at December 31, 2012, compared with 8.23% at December 31, 2011.
Ronald M. Bentley, President and CEO stated, "We set new financial performance records for Chemung Financial Corporation in 2012 while devoting much of our time and attention preparing for the future. We are pleased to report that the Capital Bank merger is delivering as promised and our other business units also performed well."
Mr. Bentley continued, "Credit quality remained strong as the level of both classified and nonperforming loans declined from year-earlier levels. Excluding some performing but past due construction loans acquired in connection with the Capital Bank merger, the ratio of total nonperforming assets to total assets at year end was 0.53%, a level attesting to our solid and stable credit quality and a ratio better than most of our peers."
Summary:
Chemung Financial Corporation reported net income of $11.0 million for the twelve months ended December 31, 2012, an increase of $0.5 million, or 4.6%, compared with $10.5 million for the twelve months ended December 31, 2011. Earnings per share for the twelve months ended December 31, 2012, was $2.38 compared with $2.40 for the twelve months ended December 31, 2011. Return on average assets and return on average equity for the twelve months ended December 31, 2012, were 0.88% and 8.41%, respectively, compared with 0.90% and 8.77%, respectively, for the prior year.
The improvement in 2012 earnings was due primarily to a $2.9 million increase in net interest income and a $2.2 million decrease in pre-tax one-time merger transaction costs, both related to the Capital Bank acquisition in April 2011. In addition, we recognized $0.8 million in pre-tax casualty gains from insurance reimbursements related to the September 2011 flooding of our Owego and Tioga offices. These items were partially offset by increases of $1.8 million in salaries and wages, $0.8 million in pension and other employee benefits, $0.5 million in data processing expenses, $0.5 million in professional services, $0.4 million in income taxes and a $0.8 million reduction in net gains on securities transactions.
Net income for the fourth quarter 2012 was $2.1 million compared with fourth quarter 2011 results of $3.0 million, a decrease of $0.9 million, or 28.1%. The decline was attributable to a decrease of $0.4 million in net interest income and an increase of $1.1 million in non-interest expense, partially offset by a reduction of $0.5 million in income taxes. Earnings per share for the current quarter totaled $0.46 compared with $0.64 for the same period in the prior year. Return on average assets and return on average equity for the current quarter were 0.67% and 6.33%, respectively, compared with 0.95% and 9.06%, respectively, for the fourth quarter of 2011.
Net income of $2.1 million for the quarter ended December 31, 2012, represents a decrease of $0.7 million, or 24.8%, from net income of $2.8 million for the preceding quarter ended September 30, 2012. The decline was primarily due to an increase of $1.2 million in non-interest expense, partially offset by a reduction of $0.4 million in income taxes. Earnings per share for the current quarter totaled $0.46 compared with $0.61 for the preceding quarter. Return on average assets and return on average equity for the current quarter were 0.67% and 6.33%, respectively, compared with 0.89% and 8.53%, respectively, for the preceding quarter.
Net Interest Income:
Net interest income for the twelve months ended December 31, 2012, totaled $46.8 million compared with $43.8 million for the prior year, an increase of $3.0 million, or 6.7%. Net interest margin was 4.07% for the twelve months ended December 31, 2012, level with the prior year. The increase in net interest income was primarily due to an increase in average earning assets. The increase in average earning assets was the result of the Capital Bank acquisition in April 2011, and organic growth during 2012 in the Albany region.
Net interest income for the fourth quarter of 2012 was $11.6 million compared with $12.0 million for the same quarter in the prior year, a decrease of $0.4 million, or 3.2%. Net interest margin declined to 3.98% for the current quarter from 4.19% for the same quarter in the prior year. The decline in net interest margin was primarily due to yields on interest-earning assets decreasing at a faster rate than the cost of interest-bearing liabilities. The decrease in yield on interest-earning assets was attributable to lower loan yields as loans continue to reprice at current market rates.
Compared with the preceding quarter ended September 30, 2012, net interest income decreased by $0.1 million, primarily due to a six basis point decline in the net interest margin. The decrease in the net interest margin was primarily due to a 19 basis point decrease in the yield on loans.
Non-Interest Income:
Non-interest income for the twelve months ended December 31, 2012, was $17.3 million compared with $17.5 million for the prior year, a decrease of $0.2 million, or 1.0%. The decline was primarily due to decreases of $0.8 million in net gain on securities transactions and $0.6 million in revenue from our equity investment in Cephas Capital Partners, L.P. These items were partially offset by $0.8 million in casualty gains from insurance reimbursements related to the September 2011 flooding of our Owego and Tioga offices and an increase of $0.3 million in net gain on sale of loans held for sale.
Non-interest income for the fourth quarter of 2012 was $4.2 million, a slight increase compared with both the preceding quarter and same quarter in the prior year, primarily due to an increase in net gain on sales of loans held for sale.
Non-Interest Expense:
Non-interest expense for the twelve months ended December 31, 2012, was $46.8 million compared with $44.8 million for the prior year, an increase of $2.0 million, or 4.6%. Excluding $2.2 million in merger related expenses from the prior year, non-interest expense increased $4.3 million, or 10.1%, for the twelve months ended December 31, 2012. This increase was primarily due to increases of $1.8 million in salaries and wages, $0.8 million in pension and other employee benefits, $0.5 million in data processing expenses and $0.5 million in professional services. The increase in salaries and wages was primarily due to the operation of the Capital Bank division for twelve months during 2012 compared with nine months during 2011, and additional compensation related to merit increases and incentive compensation. The increase in pension and other employee benefits was primarily due to higher pension costs, health benefits and payroll taxes. The increase in data processing expenses was primarily due to higher hardware and software maintenance fees and check card processing costs that included conversion costs for a new processor. The increase in professional services was due primarily to consultant fees.
Non-interest expense for the fourth quarter of 2012 was $12.6 million compared with $11.5 million for the same quarter in the prior year, an increase of $1.1 million, or 9.7%. The increase was primarily due to increases of $0.6 million in salaries and wages and $0.5 million in professional services. The increase in salaries and wages was primarily due to an increase in employees and additional compensation related to merit increases and incentive compensation. The increase in professional services was due to the reason discussed above. Compared with the preceding quarter ended September 30, 2012, non-interest expense increased $1.2 million, or 10.9%. The increase was primarily due to increases of $0.5 million in salaries and wages and $0.6 million in professional services.
Asset Quality:
Non-performing loans totaled $10.5 million at December 31, 2012, or 1.18% of total loans, down $10.4 million from $20.9 million, or 2.62%, at December 31, 2011. Non-performing assets which are comprised of non-performing loans and other real estate owned, totaled $11.1 million at December 31, 2012, or 0.89% of total assets, down $10.7 million from $21.8 million, or 1.79%, at December 31, 2011. Excluding $4.5 million in accruing loans that are 90 days or more past their stated maturity dates, the non-performing assets to total assets ratio was 0.53%.
Management performs an ongoing assessment of the adequacy of the allowance for loan losses based upon a number of factors including an analysis of historical loss factors, collateral evaluations, recent charge-off experience, credit quality of the loan portfolio, current economic conditions and loan growth. Based on this analysis, the provision for loan losses for the twelve months ended December 31, 2012, was $0.8 million, a decrease of $0.1 million compared with the prior year. Net charge-offs for the twelve months ended December 31, 2012, were $0.2 million compared with $0.8 million for the prior year.
For the fourth quarter of 2012, the provision for loan losses was $0.1 million compared with $0.2 million for the preceding quarter and $0.1 million for the same quarter in the prior year. Net charge-offs for the current quarter were $0.5 million compared with net recoveries of $0.2 million for the preceding quarter and net charge-offs of $0.1 million for the same quarter in the prior year.
At December 31, 2012, the allowance for loan losses was $10.4 million, compared with $10.8 million at September 30, 2012, and $9.7 million at December 31, 2011. The allowance for loan losses was 99.21% of non-performing loans at December 31, 2012, compared with 81.66% at September 30, 2012, and 46.18% at December 31, 2011. The ratio of the allowance for loan losses to total loans was 1.17% at December 31, 2012, compared with 1.24% at September 30, 2012, and 1.21% at December 31, 2011. Excluding acquired loans, the ratio of the allowance for loan losses on originated loans to originated loans was 1.18% at December 31, 2012, compared with 1.38% at September 30, 2012, and 1.47% at December 31, 2011.
Balance Sheet Activity:
Assets totaled $1.248 billion at December 31, 2012, compared with $1.216 billion at December 31, 2011, an increase of $31.9 million, or 2.6%. The growth was primarily due to an increase of $96.6 million, or 12.1%, in total portfolio loans, partially offset by decreases of $44.5 million in investment securities and $13.7 million in interest-bearing deposits in other financial institutions. The increase in portfolio loans was due to strong growth of $47.3 million in commercial loans and $42.5 million in consumer loans.
Deposits totaled $1.045 billion at December 31, 2012, compared with $998.5 million at December 31, 2011, an increase of $46.2 million, or 4.6%. The growth was primarily due to increases of $65.1 million in money market accounts, $41.8 million in non-interest-bearing demand deposits and $16.4 million in NOW accounts. These items were partially offset by decreases of $36.7 million in savings accounts and $40.3 million in certificates of deposit.
Total equity was $131.1 million at December 31, 2012, compared with $125.9 million at December 31, 2011. The total equity to total assets ratio was 10.50% at December 31, 2012, up from 10.35% at December 31, 2011. The tangible equity to tangible assets ratio was 8.53% at December 31, 2012, up from 8.23% at December 31, 2011. As of December 31, 2012, both the Corporation's and the Bank's capital ratios were in excess of those required to be considered well-capitalized under regulatory capital standards.
Other Item:
The market value of total assets under management or administration in our Wealth Management Group was $1.735 billion at December 31, 2012, compared with $1.596 billion at December 31, 2011.
About Chemung Financial Corporation:
Chemung Financial Corporation is a $1.2 billion financial services holding company headquartered in Elmira, New York and operates 28 retail offices through its principal subsidiary, Chemung Canal Trust Company, a full-service community bank with trust powers. Established in 1833, Chemung Canal Trust Company is the oldest locally-owned and managed community bank in New York State. Chemung Financial Corporation is also the parent of CFS Group, Inc., a financial services subsidiary offering non-traditional services including mutual funds, annuities, brokerage services, tax preparation services and insurance. CFS Group, Inc. was founded in 2001.
This press release may be found at: www.chemungcanal.com under Shareholder Info.
Forward-Looking Statements:
This press release may include forward-looking statements with respect to revenue sources, growth, market risk, corporate objectives and possible losses due to asset quality. These statements constitute "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Chemung Financial Corporation assumes no duty, and specifically disclaims any obligation to update forward-looking statements, whether as a result of new information, future events or otherwise, and cautions that these statements are subject to risks and uncertainties that could cause the Corporation's actual operating results to differ materially.
| Chemung Financial Corporation | |||||
| Consolidated Balance Sheets (Unaudited) | |||||
| Dec. 31, | Sept. 30, | June 30, | March 31, | Dec. 31, | |
| (Dollars in thousands, except share data) | 2012 | 2012 | 2012 | 2012 | 2011 |
| ASSETS | |||||
| Cash and due from financial institutions | $ 29,239 | $ 35,324 | $ 33,673 | $ 27,311 | $ 28,205 |
| Interest-bearing deposits in other financial institutions | 11,002 | 45,908 | 40,502 | 83,203 | 24,697 |
| Total cash and cash equivalents | 40,241 | 81,232 | 74,175 | 110,514 | 52,902 |
| Trading assets, at fair value | 348 | 275 | 252 | 254 | 294 |
| Securities available for sale | 239,686 | 253,669 | 260,942 | 259,450 | 280,870 |
| Securities held to maturity | 5,749 | 6,163 | 6,334 | 7,447 | 8,312 |
| FHLB and Federal Reserve Bank stocks, at cost | 4,710 | 4,760 | 5,359 | 5,436 | 5,509 |
| Total investment securities | 250,145 | 264,592 | 272,635 | 272,333 | 294,691 |
| Commercial | 454,048 | 444,491 | 436,205 | 414,536 | 406,798 |
| Mortgage | 200,476 | 193,049 | 194,512 | 192,548 | 193,600 |
| Consumer | 238,993 | 238,818 | 225,230 | 195,949 | 196,517 |
| Total loans | 893,517 | 876,358 | 855,947 | 803,033 | 796,915 |
| Allowance for loan losses | (10,433) | (10,828) | (10,392) | (10,283) | (9,659) |
| Loans, net | 883,084 | 865,530 | 845,555 | 792,750 | 787,256 |
| Loans held for sale | 1,057 | 1,165 | 482 | 826 | 395 |
| Premises and equipment, net | 25,484 | 24,863 | 24,718 | 24,977 | 24,762 |
| Goodwill | 21,824 | 21,824 | 21,824 | 21,824 | 21,984 |
| Other intangible assets, net | 5,144 | 5,382 | 5,642 | 5,906 | 6,191 |
| Other assets | 20,833 | 22,117 | 22,176 | 25,111 | 27,785 |
| Total assets | $ 1,248,160 | $ 1,286,980 | $ 1,267,459 | $ 1,254,495 | $ 1,216,260 |
| LIABILITIES AND SHAREHOLDERS' EQUITY | |||||
| Deposits: | |||||
| Demand deposits (non-interest bearing) | $ 300,610 | $ 302,509 | $ 297,413 | $ 272,055 | $ 258,836 |
| NOW accounts | 90,730 | 108,923 | 88,343 | 88,105 | 74,349 |
| Savings | 173,589 | 174,074 | 174,974 | 203,204 | 210,288 |
| Money market accounts | 243,115 | 248,722 | 232,870 | 212,376 | 178,030 |
| Certificates of deposit | 236,690 | 248,948 | 260,079 | 262,965 | 276,990 |
| Total deposits | 1,044,734 | 1,083,176 | 1,053,679 | 1,038,705 | 998,493 |
| Securities sold under agreements to repurchase | 32,711 | 32,918 | 31,750 | 34,998 | 37,107 |
| FHLB term advances | 27,225 | 28,046 | 41,128 | 43,227 | 43,344 |
| Other liabilities | 12,375 | 9,960 | 10,693 | 8,736 | 11,386 |
| Total liabilities | 1,117,045 | 1,154,100 | 1,137,250 | 1,125,666 | 1,090,330 |
| Shareholders' equity | |||||
| Common stock | 53 | 53 | 53 | 53 | 53 |
| Additional-paid-in capital | 45,357 | 45,538 | 45,525 | 45,556 | 45,583 |
| Retained earnings | 107,078 | 106,092 | 104,402 | 103,100 | 100,629 |
| Treasury stock | (18,566) | (18,731) | (18,915) | (18,734) | (18,894) |
| Accumulated other comprehensive income (loss) | (2,807) | (72) | (856) | (1,146) | (1,441) |
| Total shareholders' equity | 131,115 | 132,880 | 130,209 | 128,829 | 125,930 |
| Total liabilities and shareholders' equity | $ 1,248,160 | $ 1,286,980 | $ 1,267,459 | $ 1,254,495 | $ 1,216,260 |
| Period-end shares outstanding | 4,649,741 | 4,642,317 | 4,632,014 | 4,639,565 | 4,640,646 |
| Chemung Financial Corporation | ||||||
| Consolidated Statements of Income (Unaudited) | ||||||
| Twelve Months Ended | Three Months Ended | |||||
| December 31, | Percent | December 31, | Percent | |||
| (Dollars in thousands, except share and per share data) | 2012 | 2011 | Change | 2012 | 2011 | Change |
| Interest and dividend income: | ||||||
| Loans, including fees | $ 45,298 | $ 43,181 | 4.9 | $ 11,220 | $ 11,725 | (4.3) |
| Taxable securities | 5,358 | 5,874 | (8.8) | 1,215 | 1,526 | (20.4) |
| Tax exempt securities | 1,268 | 1,379 | (8.0) | 292 | 344 | (15.1) |
| Interest-bearing deposits | 153 | 214 | (28.5) | 30 | 47 | (36.2) |
| Total interest and dividend income | 52,077 | 50,648 | 2.8 | 12,757 | 13,642 | (6.5) |
| Interest expense: | ||||||
| Deposits | 3,243 | 4,351 | (25.5) | 710 | 1,025 | (30.7) |
| Securities sold under agreements to repurchase | 994 | 1,375 | (27.7) | 231 | 319 | (27.6) |
| Borrowed funds | 1,059 | 1,073 | (1.3) | 190 | 290 | (34.5) |
| Total interest expense | 5,296 | 6,799 | (22.1) | 1,131 | 1,634 | (30.8) |
| Net interest income | 46,781 | 43,849 | 6.7 | 11,626 | 12,008 | (3.2) |
| Provision for loan losses | 828 | 958 | (13.6) | 74 | 125 | (40.8) |
| Net interest income after provision for loan losses | 45,953 | 42,891 | 7.1 | 11,552 | 11,883 | (2.8) |
| Non-interest income: | ||||||
| Wealth management group fee income | 6,827 | 6,710 | 1.7 | 1,657 | 1,579 | 4.9 |
| Service charges on deposit accounts | 4,241 | 4,282 | (1.0) | 1,098 | 1,101 | (0.3) |
| Net gain on securities transactions | 301 | 1,108 | (72.8) | -- | -- | N/M |
| Net impairment loss recognized in earnings | -- | (67) | N/M | -- | -- | N/M |
| Net gain on sales of loans held for sale | 484 | 179 | 170.4 | 214 | 46 | 365.2 |
| Casualty gains | 790 | -- | N/M | -- | -- | N/M |
| Other | 4,647 | 5,252 | (11.5) | 1,233 | 1,318 | (6.4) |
| Total non-interest income | 17,290 | 17,464 | (1.0) | 4,202 | 4,044 | 3.9 |
| Non-interest expense: | ||||||
| Salaries and wages | 18,918 | 17,136 | 10.4 | 5,207 | 4,602 | 13.1 |
| Pension and other employee benefits | 5,624 | 4,797 | 17.2 | 1,486 | 1,500 | (0.9) |
| Net occupancy | 5,164 | 5,016 | 3.0 | 1,315 | 1,353 | (2.8) |
| Furniture and equipment | 2,205 | 2,119 | 4.1 | 605 | 570 | 6.1 |
| Data processing | 4,421 | 3,916 | 12.9 | 1,142 | 1,035 | 10.3 |
| Professional services | 1,443 | 950 | 51.9 | 749 | 205 | 265.4 |
| Amortization of intangible assets | 1,047 | 1,041 | 0.6 | 238 | 288 | (17.4) |
| Marketing and advertising | 1,068 | 1,037 | 3.0 | 153 | 246 | (37.8) |
| FDIC insurance | 807 | 967 | (16.5) | 192 | 230 | (16.5) |
| Loan expenses | 788 | 608 | 29.6 | 240 | 160 | 50.0 |
| Other real estate owned expenses | 328 | 105 | 212.4 | 42 | 19 | 121.1 |
| Merger related expenses | 30 | 2,255 | (98.7) | -- | 11 | (100.0) |
| Other | 4,994 | 4,837 | 3.2 | 1,268 | 1,303 | (2.7) |
| Total non-interest expense | 46,837 | 44,784 | 4.6 | 12,637 | 11,522 | 9.7 |
| Income before income tax expense | 16,406 | 15,571 | 5.4 | 3,117 | 4,405 | (29.2) |
| Income tax expense | 5,384 | 5,033 | 7.0 | 987 | 1,443 | (31.6) |
| Net income | $ 11,022 | $ 10,538 | 4.6 | $ 2,130 | $ 2,962 | (28.1) |
| Basic and diluted earnings per share | $ 2.38 | $ 2.40 | $ 0.46 | $ 0.64 | ||
| Cash dividends declared per share | 1.25 | 1.00 | 0.50 | 0.25 | ||
| Average basic and diluted shares outstanding | 4,640,912 | 4,382,843 | 4,643,695 | 4,638,042 | ||
| N/M – Not meaningful. | ||||||
| Chemung Financial Corporation | |||||||
| Consolidated Financial Highlights (Unaudited) | |||||||
| As of or for the | |||||||
| As of or for the Three Months Ended | Twelve Months Ended | ||||||
| Dec. 31, | Sept. 30, | June 30, | March 31, | Dec. 31, | Dec. 31, | Dec. 31, | |
| (Dollars in thousands, except share and per share data) | 2012 | 2012 | 2012 | 2012 | 2011 | 2012 | 2011 |
| RESULTS OF OPERATIONS | |||||||
| Interest income | $ 12,757 | $ 13,015 | $ 12,765 | $ 13,540 | $ 13,642 | $ 52,077 | $ 50,648 |
| Interest expense | 1,131 | 1,240 | 1,400 | 1,524 | 1,634 | 5,296 | 6,799 |
| Net interest income | 11,626 | 11,775 | 11,365 | 12,016 | 12,008 | 46,781 | 43,849 |
| Provision for loan losses | 74 | 225 | 52 | 477 | 125 | 828 | 958 |
| Net interest income after provision for loan losses | 11,552 | 11,550 | 11,313 | 11,539 | 11,883 | 45,953 | 42,891 |
| Non-interest income | 4,202 | 4,060 | 4,131 | 4,897 | 4,044 | 17,290 | 17,464 |
| Non-interest expense | 12,637 | 11,393 | 11,885 | 10,922 | 11,522 | 46,837 | 44,784 |
| Income before income tax expense | 3,117 | 4,217 | 3,559 | 5,514 | 4,405 | 16,406 | 15,571 |
| Income tax expense | 987 | 1,383 | 1,115 | 1,899 | 1,443 | 5,384 | 5,033 |
| Net income | $ 2,130 | $ 2,834 | $ 2,444 | $ 3,615 | $ 2,962 | $ 11,022 | $ 10,538 |
| Basic and diluted earnings per share | $ 0.46 | $ 0.61 | $ 0.53 | $ 0.78 | $ 0.64 | $ 2.38 | $ 2.40 |
| Average basic and diluted shares outstanding | 4,643,695 | 4,641,547 | 4,636,395 | 4,642,012 | 4,638,042 | 4,640,912 | 4,382,843 |
| PERFORMANCE RATIOS | |||||||
| Return on average assets | 0.67% | 0.89% | 0.78% | 1.18% | 0.95% | 0.88% | 0.90% |
| Return on average equity | 6.33% | 8.53% | 7.55% | 11.34% | 9.06% | 8.41% | 8.77% |
| Return on average tangible equity (a) | 7.94% | 10.76% | 9.58% | 14.47% | 11.60% | 10.63% | 11.05% |
| Efficiency ratio | 78.21% | 70.16% | 74.75% | 62.85% | 69.88% | 71.32% | 71.18% |
| Non-interest expense to average assets | 3.98% | 3.59% | 3.82% | 3.56% | 3.68% | 3.74% | 3.81% |
| Loans to deposits | 85.53% | 80.91% | 81.23% | 77.31% | 79.81% | 85.53% | 79.81% |
| YIELDS / RATES | |||||||
| Yield on loans | 5.02% | 5.21% | 5.39% | 5.90% | 5.85% | 5.37% | 5.83% |
| Yield on investments | 2.23% | 2.23% | 2.13% | 2.27% | 2.22% | 2.22% | 2.22% |
| Yield on interest-earning assets | 4.36% | 4.46% | 4.46% | 4.83% | 4.76% | 4.53% | 4.70% |
| Cost of interest-bearing deposits | 0.37% | 0.40% | 0.44% | 0.50% | 0.54% | 0.43% | 0.60% |
| Cost of borrowings | 2.74% | 2.85% | 3.02% | 2.96% | 2.84% | 2.90% | 3.01% |
| Cost of interest-bearing liabilities | 0.55% | 0.60% | 0.67% | 0.74% | 0.77% | 0.64% | 0.85% |
| Interest rate spread | 3.81% | 3.86% | 3.79% | 4.09% | 3.99% | 3.89% | 3.85% |
| Net interest margin | 3.98% | 4.04% | 3.97% | 4.28% | 4.19% | 4.07% | 4.07% |
| CAPITAL | |||||||
| Total equity to total assets at end of period | 10.50% | 10.32% | 10.27% | 10.27% | 10.35% | 10.50% | 10.35% |
| Tangible equity to tangible assets at end of period (a) | 8.53% | 8.39% | 8.29% | 8.24% | 8.23% | 8.53% | 8.23% |
| Book value per share | $ 28.20 | $ 28.62 | $ 28.11 | $ 27.77 | $ 27.14 | $ 28.20 | $ 27.14 |
| Tangible book value per share | 22.40 | 22.76 | 22.18 | 21.79 | 21.07 | 22.40 | 21.07 |
| Period-end market value per share | 29.89 | 23.77 | 25.50 | 25.40 | 22.70 | 29.89 | 22.70 |
| Dividends declared per share | 0.50 | 0.25 | 0.25 | 0.25 | 0.25 | 1.25 | 1.00 |
| AVERAGE BALANCES | |||||||
| Loans (b) | $ 888,515 | $ 867,971 | $ 823,754 | $ 796,035 | $ 795,450 | $ 844,256 | $ 740,950 |
| Earning assets | 1,162,788 | 1,160,479 | 1,150,073 | 1,128,047 | 1,138,120 | 1,150,409 | 1,078,418 |
| Total assets | 1,264,125 | 1,262,648 | 1,252,461 | 1,235,453 | 1,241,144 | 1,253,725 | 1,175,046 |
| Deposits | 1,059,463 | 1,055,510 | 1,037,576 | 1,018,035 | 1,017,116 | 1,042,727 | 965,183 |
| Total equity | 133,799 | 132,186 | 130,254 | 128,194 | 129,767 | 131,119 | 120,225 |
| Tangible equity (a) | 106,703 | 104,827 | 102,635 | 100,465 | 101,279 | 103,670 | 95,375 |
| ASSET QUALITY | |||||||
| Net charge-offs (recoveries) | $ 469 | $ (210) | $ (58) | $ (23) | $ 143 | $ 178 | $ 797 |
| Non-performing loans | 10,516 | 13,260 | 15,009 | 15,077 | 20,915 | 10,516 | 20,915 |
| Non-performing assets | 11,081 | 14,194 | 15,979 | 16,057 | 21,813 | 11,081 | 21,813 |
| Allowance for loan losses | 10,433 | 10,828 | 10,392 | 10,283 | 9,659 | 10,433 | 9,659 |
| Annualized net charge-offs to average loans | 0.21% | (0.10)% | (0.03)% | (0.01)% | 0.07% | 0.02% | 0.11% |
| Non-performing loans to total loans | 1.18% | 1.51% | 1.75% | 1.88% | 2.62% | 1.18% | 2.62% |
| Non-performing assets to total assets | 0.89% | 1.10% | 1.26% | 1.28% | 1.79% | 0.89% | 1.79% |
| Allowance for loan losses to total loans | 1.17% | 1.24% | 1.21% | 1.28% | 1.21% | 1.17% | 1.21% |
| Allowance for originated loans to originated loans (c) | 1.18% | 1.38% | 1.38% | 1.48% | 1.47% | 1.18% | 1.47% |
| Allowance for loan losses to non-performing loans | 99.21% | 81.66% | 69.24% | 68.20% | 46.18% | 99.21% | 46.18% |
| (a) See the GAAP to Non-GAAP reconciliations. | |||||||
| (b) Loans include loans held for sale. Loans do not reflect the allowance for loan losses. | |||||||
| (c) Originated loans represent total loans excluding acquired loans. | |||||||
Chemung Financial Corporation
GAAP to Non-GAAP Reconciliations (Unaudited)
The table below shows computations of tangible equity and tangible assets and certain related ratios, all of which are considered to be non-GAAP financial measures. The tangible equity to tangible assets ratio has become a focus of some investors and management believes this ratio may assist in analyzing the Corporation's capital position, absent the effects of intangible assets. These non-GAAP financial measures have limitations as analytical tools, and should not be considered in isolation, or as a substitute for analysis of results reported under GAAP. Because not all companies use identical calculations, the non-GAAP measures presented in the following table may not be comparable to those reported by other companies.
| As of or for the | |||||||
| As of or for the Three Months Ended | Twelve Months Ended | ||||||
| Dec. 31, | Sept. 30, | June 30, | March 31, | Dec. 31, | Dec. 31, | Dec. 31, | |
| (Dollars in thousands, except per share data) | 2012 | 2012 | 2012 | 2012 | 2011 | 2012 | 2011 |
| TANGIBLE EQUITY AND TANGIBLE ASSETS | |||||||
| (PERIOD END) | |||||||
| Total shareholders' equity (GAAP) | $ 131,115 | $ 132,880 | $ 130,209 | $ 128,829 | $ 125,930 | $ 131,115 | $ 125,930 |
| Less: intangible assets | (26,968) | (27,206) | (27,466) | (27,730) | (28,175) | (26,968) | (28,175) |
| Tangible equity (non-GAAP) | $ 104,147 | $ 105,674 | $ 102,743 | $ 101,099 | $ 97,755 | $ 104,147 | $ 97,755 |
| Total assets (GAAP) | $ 1,248,160 | $ 1,286,980 | $ 1,267,459 | $ 1,254,495 | $ 1,216,260 | $ 1,248,160 | $ 1,216,260 |
| Less: intangible assets | (26,968) | (27,206) | (27,466) | (27,730) | (28,175) | (26,968) | (28,175) |
| Tangible assets (non-GAAP) | $ 1,221,192 | $ 1,259,774 | $ 1,239,993 | $ 1,226,765 | $ 1,188,085 | $ 1,221,192 | $ 1,188,085 |
| Total equity to total assets at end of period (GAAP) | 10.50% | 10.32% | 10.27% | 10.27% | 10.35% | 10.50% | 10.35% |
| Book value per share (GAAP) | $ 28.20 | $ 28.62 | $ 28.11 | $ 27.77 | $ 27.14 | $ 28.20 | $ 27.14 |
| Tangible equity to tangible assets at end of period (non-GAAP) | 8.53% | 8.39% | 8.29% | 8.24% | 8.23% | 8.53% | 8.23% |
| Tangible book value per share (non-GAAP) | $ 22.40 | $ 22.76 | $ 22.18 | $ 21.79 | $ 21.07 | $ 22.40 | $ 21.07 |
| TANGIBLE EQUITY AND TANGIBLE ASSETS | |||||||
| (AVERAGE) | |||||||
| Total shareholders' equity (GAAP) | $ 133,799 | $ 132,186 | $ 130,254 | $ 128,194 | $ 129,767 | $ 131,119 | $ 120,225 |
| Less: intangible assets | (27,096) | (27,359) | (27,619) | (27,729) | (28,488) | (27,449) | (24,850) |
| Tangible equity (non-GAAP) | $ 106,703 | $ 104,827 | $ 102,635 | $ 100,465 | $ 101,279 | $ 103,670 | $ 95,375 |
| Return on average equity (GAAP) | 6.33% | 8.53% | 7.55% | 11.34% | 9.06% | 8.41% | 8.77% |
| Return on average tangible equity (non-GAAP) | 7.94% | 10.76% | 9.58% | 14.47% | 11.60% | 10.63% | 11.05% |
CONTACT: Mark A. Severson, EVP and CFO
Phone: 607-737-3714