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NBT Bancorp Inc. Announces Record Third Quarter Earnings and a 5% Cash Dividend Increase

NORWICH, N.Y., Oct. 28, 2013 (GLOBE NEWSWIRE) -- NBT Bancorp Inc. (NBT) (Nasdaq:NBTB) reported net income for the three months ended September 30, 2013 of $19.3 million, up from $16.9 million from the prior quarter, and up from $14.5 million for the third quarter of 2012. Reported earnings per diluted share for the three months ended September 30, 2013 was $0.44 as compared to $0.38 from the prior quarter and $0.43 for the third quarter of 2012. The third quarter 2013 earnings represent the third highest quarterly earnings per diluted share reported in the Company's history.

Core net income for the three months ended September 30, 2013 was $19.4 million, up 8.5% from $17.8 million for the prior quarter, and up 34.9% from $14.4 million for the third quarter of 2012. Core diluted earnings per share for the three months ended September 30, 2013 was $0.44, up from $0.40 for the prior quarter, and up from $0.42 for the third quarter of 2012.

Reported net income for the nine months ended September 30, 2013 was $43.8 million, up from $41.4 million for the same period last year. 2013 results included the impact of the acquisition of Alliance in March 2013, including approximately $12.3 million in merger related expenses. Reported diluted earnings per share for the nine months ended September 30, 2013 was $1.05, as compared to $1.23 for the same period in 2012.

Core net income for the nine months ended September 30, 2013 was $51.5 million, up 24.9% from $41.2 million for the same period in 2012, due primarily to the impact of the Alliance acquisition. Core diluted earnings per share for the nine months ended September 30, 2013 was $1.23, equivalent to the same period last year.

Third Quarter Highlights:

  • Core diluted EPS $0.44, up from $0.40 in the prior quarter and $0.42 for the third quarter of 2012
  • Strong loan growth continued in the third quarter (5.7% annualized)
  • Continued progress on operational efficiencies

"We are very pleased with our third quarter results, which were characterized by strong organic loan growth, earnings growth, stable asset quality and continued improvement in operational efficiencies," said NBT President and CEO Martin Dietrich. "In addition, we are especially proud of the successful integration of Alliance Bank into NBT Bank that has strengthened our position in central New York. Through this acquisition, which is the largest in NBT's history, we have achieved the cost savings and operational synergies we identified and ushered in a new era for NBT. Over the last two years, we have added $2 billion to our balance sheet through strategic expansion, providing NBT with significant new growth opportunities in markets where we believe we are well positioned to build upon our foundations and leverage the strong potential that exists. Finally, we are glad to have the opportunity to share our successes with our shareholders in the form of a 5% cash dividend increase."

Net interest income was $62.2 million for the three months ended September 30, 2013, up marginally from the prior quarter, and up $9.6 million from the third quarter of 2012 primarily due to the acquisition of Alliance. Average interest earning assets were up $50.1 million, or 0.7%, for the third quarter of 2013 as compared to the prior quarter, driven primarily by organic loan production during the third quarter. This increase was offset by a decrease in the yields on interest earning assets from 4.16% for the second quarter of 2013 to 4.08% for the third quarter, driven primarily by the 13 bp decrease in loan yields. Average interest bearing liabilities showed a 0.8% decrease from the second quarter of 2013 to the third quarter and rates paid on interest bearing liabilities decreased 5 bps during the same period resulting in a 7.6% decrease in interest expense from the second quarter of 2013 to the third quarter.

The Company's Fully Tax Equivalent ("FTE") net interest margin was 3.65% for the three months ended September 30, 2013, down from 3.69% from the prior quarter, and down from 3.90% for the third quarter of 2012. Rate compression on earning assets continued to negatively impact net interest margin in the third quarter of 2013 as evidenced by decreasing loan yields from 4.76% for the second quarter of 2013 to 4.63% for the third quarter of 2013. The rate compression on earning assets was partially offset by the 5 bp decrease in the rates paid on interest bearing liabilities in the third quarter of 2013 versus the prior quarter. This decrease was primarily driven by decreases in rates paid on long-term debt as maturing higher cost borrowings were replaced with lower rate short term borrowings.

Net interest income was $176.0 million for the nine months ended September 30, 2013, up 16.0% from the same period in 2012. This increase from the prior year was due primarily to the 22.0% increase in average earning assets for the nine months ended September 30, 2013 over the prior year. The acquisition of Alliance in March 2013 as well as the full year impact of 2012 loan growth contributed to the growth in average earning assets.

The Company's FTE net interest margin was 3.67% for the nine months ended September 30, 2013, down from 3.87% for the same period last year. Rate compression on earning assets continued to negatively impact net interest margin for the first nine months of 2013 as evidenced by decreasing loan yields from 5.21% for the first nine months of 2012 to 4.75% for the first nine months of 2013. In addition, yields on available for sale securities declined 49 bps in the first nine months of 2013 as compared to the same period in 2012. The rate compression on earning assets was partially offset by the 24 bp decrease in the rates paid on interest bearing liabilities in the first nine months of 2013 as compared to the same period in 2012.

Noninterest income for the three months ended September 30, 2013 was $27.1 million, up 6.3% from the prior quarter, and up 25.5% from the third quarter of 2012 due primarily to the acquisition of Alliance. The increase from the prior quarter was driven primarily by an increase in other noninterest income, which increased $0.8 million from the prior quarter. Increases in loan fees collected and swap fees recognized during the third quarter contributed to this increase. In addition, the Company recorded $0.3 million in securities gains during the third quarter, as compared to securities losses totaling $0.1 million for the second quarter of 2013.

Noninterest income for the nine months ended September 30, 2013 was $77.9 million, up 19.2% from the same period in 2012, with the primary drivers being increases in trust revenue and ATM and debit card fees driven primarily by the acquisition of Alliance. In addition, the Company experienced a 9.8% increase in insurance and financial services revenue for the nine months ended September 30, 2013 as compared to the same period in 2012, due primarily to an increase in insurance revenue of $1.0 million as well as an increase in financial services revenue of $0.6 million. Retirement plan administration fees were also up 16.6% for the nine months ended September 30, 2013 as compared to the same period in 2012 due to growth in new business of 2013.

Noninterest expense for the three months ended September 30, 2013 was $56.3 million, down 0.3% from the prior quarter, and up 13.9% from the third quarter of 2012 primarily due to the acquisition of Alliance. Excluding merger expenses totaling $0.3 million and $1.3 million during the third quarter and second quarter of 2013, respectively, noninterest expense was up $0.8 million, or 1.4%, for the third quarter of 2013 as compared to the prior quarter. Income tax expense for the three month period ended September 30, 2013 was $8.6 million, up from $7.4 million from the prior quarter, and up from $5.5 million for the third quarter of 2012. The increase from previous quarters is due primarily to the increase in pre-tax income during the third quarter. The effective tax rate was 31.0% for the third quarter and 30.5% for the second quarter of 2013.

Noninterest expense for the nine months ended September 30, 2013 was $173.4 million, up $28.1 million or 19.4%, from the same period in 2012. Excluding merger expenses totaling $12.3 million and $1.9 million for the nine months ended September 30, 2013 and 2012, respectively, noninterest expense was up $17.8 million, or 12.4%, for the first nine months of 2013 as compared to the same period in 2012. Several noninterest expense categories were affected by the acquisition of Alliance in March 2013 and the full year impact of the 2012 acquisition of Hampshire First Bank with salaries and employee benefits and occupancy expenses being the primary drivers of the increase over last year. Income tax expense for the nine months ended September 30, 2013 was $19.4 million, up from $17.0 million from the same period in 2012 due primarily to the increase in pre-tax income for the first nine months of 2013 and an increase in the effective tax rate to 30.7% for the nine months ended September 30, 2013 as compared with 29.1% for the same period last year.

Asset Quality

Net charge-offs were $6.2 million for the three months ended September 30, 2013, up from $4.0 million for the prior quarter, due primarily to the third quarter charge-off of one commercial real estate loan that was provided for in the prior quarter. The Company recorded a provision for loan losses of $5.2 million for the three months ended September 30, 2013, compared with $6.4 million for the prior quarter, and $4.8 million for the third quarter of 2012. The decrease from the prior quarter was due primarily to a $1.4 million specific reserve established on the aforementioned commercial real estate loan during the second quarter of 2013.

Net charge-offs were $16.4 million for the nine months ended September 30, 2013, up from $13.9 million from the same period in 2012 due primarily to two commercial loan charge-offs in 2013 totaling $3.7 million, of which $2.2 million was previously provided for in 2012. Annualized net charge-offs to average loans for the nine months ended September 30, 2013 was 0.44%, compared to 0.47% for the same period last year. The Company recorded a provision for loan losses of $17.3 million for the nine months ended September 30, 2013, compared with $13.3 million for the same period in 2012. This increase was due primarily to organic loan growth during the period and a higher level of charge-offs in 2013.

Nonperforming loans to total loans was 0.83% at September 30, 2013, up 3 bps from the prior quarter, and down from 0.98% at December 31, 2012. Past due loans as a percentage of total loans were 0.70% for the third quarter as compared to 0.71% for the second quarter of 2013, as well as December 31, 2012.

The allowance for loan losses totaled $70.2 million at September 30, 2013, compared to $71.2 million at June 30, 2013 and $69.3 million at December 31, 2012. The allowance for loan losses as a percentage of loans was 1.31% (1.60% excluding acquired loans with no related allowance recorded) at September 30, 2013, compared to 1.35% (1.68% excluding acquired loans with no related allowance recorded) at June 30, 2013 and 1.62% (1.71% excluding acquired loans with no related allowance recorded) at December 31, 2012.

Balance Sheet

Total assets were $7.7 billion at September 30, 2013, up $1.6 billion (approximately $1.4 billion from Alliance acquisition) or 26.9% from December 31, 2012. Loans were $5.4 billion at September 30, 2013, up $1.1 billion from December 31, 2012, primarily due to approximately $904 million from the Alliance acquisition coupled with strong organic loan growth during the second and third quarters of 2013. Total deposits were $6.0 billion at September 30, 2013, up $1.2 billion from December 31, 2012, primarily due to the Alliance acquisition. Stockholders' equity was $795.6 million, representing a total equity-to-total assets ratio of 10.37% at September 30, 2013, compared with $582.3 million or a total equity-to-total assets ratio of 9.64% at December 31, 2012.

Stock Repurchase Program

Under a previously disclosed stock repurchase plan, the Company purchased 584,925 shares of its common stock during the nine month period ended September 30, 2013, for a total of $12.5 million at an average price of $21.30 per share. At September 30, 2013, there were 163,088 shares available for repurchase under this plan, which expires on December 31, 2013. On July 22, 2013, the NBT Board of Directors authorized a new repurchase program for NBT to repurchase up to an additional 1,000,000 shares of its outstanding common stock. This plan expires on December 31, 2014.

Dividend

The NBT Board of Directors declared a 2013 fourth-quarter cash dividend of $0.21 per share at a meeting held today. This marks a 5% increase from the prior quarter dividend. The dividend will be paid on December 15, 2013 to shareholders of record as of December 1, 2013.

Corporate Overview

NBT Bancorp Inc. is a financial holding company headquartered in Norwich, N.Y., with total assets of $7.7 billion at September 30, 2013. The company primarily operates through NBT Bank, N.A., a full-service community bank with two geographic divisions, and through two financial services companies. NBT Bank, N.A. has 160 locations, including 125 NBT Bank offices in upstate New York, northwestern Vermont, western Massachusetts, and southern New Hampshire. NBT's Pennstar Bank division operates from 35 Pennstar Bank offices in northeastern Pennsylvania. EPIC Advisors, Inc., based in Rochester, N.Y., is a full-service 401(k) plan recordkeeping firm. Mang Insurance Agency, LLC, based in Norwich, N.Y., is a full-service insurance agency. More information about NBT and its divisions can be found on the Internet at: www.nbtbancorp.com, www.nbtbank.com, www.pennstarbank.com, www.epic1st.com and www.manginsurance.com.

Forward-Looking Statements

This news release contains forward-looking statements. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of the management of NBT Bancorp and its subsidiaries and on the information available to management at the time that these statements were made. There are a number of factors, many of which are beyond NBT's control, that could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following possibilities: (1) competitive pressures among depository and other financial institutions may increase significantly; (2) revenues may be lower than expected; (3) changes in the interest rate environment may reduce interest margins; (4) general economic conditions, either nationally or regionally, may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and/or a reduced demand for credit; (5) legislative or regulatory changes, including changes in accounting standards and tax laws, may adversely affect the businesses in which NBT is engaged; (6) competitors may have greater financial resources and develop products that enable such competitors to compete more successfully than NBT; (7) adverse changes may occur in the securities markets or with respect to inflation; (8) operating costs, customer losses and business disruption following the recently completed acquisition of alliance, including adverse effects of relationships with employees, may be greater than expected; and (9) the risk that the anticipated benefits, costs savings and any other savings from the merger may not be fully realized or may take longer than expected to realize. Forward-looking statements speak only as of the date they are made. Except as required by law, NBT does not update forward-looking statements to reflect subsequent circumstances or events.

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). These measures adjust GAAP measures to exclude the effects of sales of securities and certain non-recurring and merger-related expenses. Where non-GAAP disclosures are used in this press release, the comparable GAAP measure, as well as a reconciliation to the comparable GAAP measure, is provided in the accompanying tables. Management believes that these non-GAAP measures provided useful information that is important to an understanding of the operating results of NBT's core business (due to the non-recurring nature of the excluded items). 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.

NBT Bancorp Inc. and Subsidiaries
SELECTED FINANCIAL DATA
(unaudited, dollars in thousands except per share data)
2013 2012
3rd Q 2nd Q 1st Q 4th Q 3rd Q
Reconciliation of Non-GAAP Financial Measures:
Reported net income (GAAP) $19,257 $16,916 $7,649 $13,116 $14,535
Adj: (Gain) / Loss on sale of securities, net (net of tax) (228) 42 (795) (15) (18)
Adj: Other adjustments (net of tax) (1) 110 -- -- -- 239
Plus: Merger related expenses (net of tax) 224 882 7,423 496 388
Reversal of uncertain tax position -- -- -- -- (790)
Total Adjustments 106 924 6,628 481 (181)
Core net income $19,363 $17,840 $14,277 $13,597 $14,354
Profitability:
Core Diluted Earnings Per Share $0.44 $0.40 $0.39 $0.40 $0.42
Diluted Earnings Per Share $0.44 $0.38 $0.21 $0.39 $0.43
Weighted Average Diluted Common Shares Outstanding 44,135,114 44,316,531 36,794,356 33,987,465 33,961,375
Core Return on Average Assets (2) 1.02% 0.95% 0.90% 0.89% 0.96%
Return on Average Assets (2) 1.01% 0.90% 0.48% 0.86% 0.97%
Core Return on Average Equity (2) 9.67% 8.88% 9.01% 9.34% 10.00%
Return on Average Equity (2) 9.62% 8.42% 4.83% 9.01% 10.13%
Core Return on Average Tangible Common Equity (2)(4) 15.95% 14.57% 13.58% 13.71% 14.74%
Return on Average Tangible Common Equity (2)(4) 15.86% 13.85% 7.49% 13.25% 14.93%
Net Interest Margin (3) 3.65% 3.69% 3.68% 3.83% 3.90%
Nine Months Ended September 30,
Reconciliation of Non-GAAP Financial Measures: 2013 2012
Reported net income (GAAP) $43,822 $41,442
Adj: (Gain) / Loss on sale of securities, net (net of tax) (981) (405)
Adj: Other adjustments (net of tax) (6) 110 (365)
Plus: Merger related expenses (net of tax) 8,529 1,322
Reversal of uncertain tax position -- (790)
Total Adjustments 7,658 (238)
Core net income $51,480 $41,204
Profitability:
Core Diluted Earnings Per Share $1.23 $1.23
Diluted Earnings Per Share $1.05 $1.23
Weighted Average Diluted Common Shares Outstanding 41,768,796 33,626,071
Core Return on Average Assets (2) 0.96% 0.95%
Return on Average Assets (2) 0.82% 0.95%
Core Return on Average Equity (2) 9.20% 9.91%
Return on Average Equity (2) 7.83% 9.97%
Core Return on Average Tangible Common Equity (2)(5) 14.75% 14.37%
Return on Average Tangible Common Equity (2)(5) 12.64% 14.45%
Net Interest Margin (3) 3.67% 3.87%
(1) Primarily reorganization expenses for 2013 and a write-down of an other asset for 2012
(2) Annualized
(3) Calculated on a Fully Tax Equivalent ("FTE")
(4) Excludes amortization of intangible assets (net of tax) from net income and average tangible common equity is calculated as follows:
2013 2012
3rd Q 2nd Q 1st Q 4th Q 3rd Q
Average stockholders' equity $ 794,273 $ 806,200 $ 642,693 $ 579,211 $ 570,880
Less: average goodwill and other intangibles 292,271 292,775 200,779 169,612 169,445
Average tangible common equity $ 502,002 $ 513,425 $ 441,914 $ 409,599 $ 401,435
(5) Excludes amortization of intangible assets (net of tax) from net income and average tangible common equity is calculated as follows:
9 Months ended September 30,
2013 2012
Average stockholders' equity $ 748,277 $ 555,182
Less: average goodwill and other intangibles 262,277 158,035
Average tangible common equity $ 486,000 $ 397,147
(6) Reorganization expenses for 2013; prepayment penalty income and flood insurance recoveries, partially offset by an other asset write-down for 2012
NBT Bancorp Inc. and Subsidiaries
SELECTED FINANCIAL DATA
(unaudited, dollars in thousands except per share data)
2013 2012
3rd Q 2nd Q 1st Q 4th Q 3rd Q
Balance Sheet Data:
Securities Available for Sale $1,385,734 $1,390,403 $1,465,791 $1,147,999 $1,191,107
Securities Held to Maturity 118,259 122,302 62,474 60,563 61,302
Net Loans 5,297,047 5,219,526 5,126,299 4,208,282 4,180,385
Total Assets 7,668,903 7,534,518 7,610,831 6,042,259 6,028,916
Total Deposits 6,003,138 5,878,176 6,015,963 4,784,349 4,806,015
Total Borrowings 783,439 795,918 715,728 605,855 579,931
Total Liabilities 6,873,344 6,742,943 6,807,536 5,459,986 5,452,255
Stockholders' Equity 795,559 791,575 803,295 582,273 576,661
Asset Quality:
Nonaccrual Loans $41,418 $40,525 $41,726 $39,676 $42,661
90 Days Past Due and Still Accruing 3,286 2,004 1,651 2,448 2,963
Total Nonperforming Loans 44,704 42,529 43,377 42,124 45,624
Other Real Estate Owned 3,626 3,757 2,864 2,276 1,863
Total Nonperforming Assets 48,330 46,286 46,241 44,400 47,487
Allowance for Loan Losses 70,184 71,184 68,734 69,334 70,734
Allowance for Loan Losses to Total Originated Loans (1) 1.60% 1.68% 1.69% 1.72% 1.77%
Allowance for Loan Losses to Total Loans 1.31% 1.35% 1.32% 1.62% 1.66%
Total Nonperforming Loans to Total Loans 0.83% 0.80% 0.83% 0.98% 1.07%
Total Nonperforming Assets to Total Assets 0.63% 0.61% 0.61% 0.73% 0.79%
Past Due Loans to Total Loans 0.70% 0.71% 0.81% 0.71% 0.65%
Allowance for Loan Losses to Total Nonperforming Loans 157.00% 167.38% 158.46% 164.60% 155.04%
Net Charge-Offs to Average Loans (4) 0.46% 0.30% 0.56% 0.78% 0.45%
Capital:
Equity to Assets 10.37% 10.51% 10.55% 9.64% 9.56%
Book Value Per Share $18.38 $18.18 $18.36 $17.24 $17.09
Tangible Book Value Per Share (2) $11.64 $11.46 $11.67 $12.23 $12.06
Tier 1 Leverage Ratio (3) 8.79% 8.72% 10.25% 8.54% 8.51%
Tier 1 Capital Ratio 11.46% 11.20% 11.33% 11.00% 10.82%
Total Risk-Based Capital Ratio 12.71% 12.45% 12.58% 12.25% 12.07%
Common Stock Price (End of Period) $22.98 $21.17 $22.15 $20.27 $22.07
(1) Excludes acquired loans with no related allowance recorded
(2) Stockholders' equity less goodwill and intangible assets divided by common shares outstanding
(3) The Tier 1 Leverage Ratio for the first quarter of 2013 was impacted by timing of the acquisition of Alliance on March 8, 2013
(4) Annualized
Note: Year-to-date (YTD) EPS may not equal sum of quarters due to share count differences.
NBT Bancorp Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS
(unaudited, dollars in thousands)
September 30, December 31,
ASSETS 2013 2012
Cash and due from banks $ 205,884 $ 157,094
Short term interest bearing accounts 2,358 6,574
Securities available for sale, at fair value 1,385,734 1,147,999
Securities held to maturity (fair value of $115,622 and $61,535 at September 30, 2013 and December 31, 2012, respectively) 118,259 60,563
Trading securities 5,285 3,918
Federal Reserve and Federal Home Loan Bank stock 43,490 29,920
Loans 5,367,231 4,277,616
Less allowance for loan losses 70,184 69,334
Net loans 5,297,047 4,208,282
Premises and equipment, net 86,891 77,875
Goodwill 265,052 152,373
Intangible assets, net 26,857 16,962
Bank owned life insurance 113,821 80,702
Other assets 118,225 99,997
TOTAL ASSETS $ 7,668,903 $ 6,042,259
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Demand (noninterest bearing) $ 1,595,571 $ 1,242,712
Savings, NOW, and money market 3,343,837 2,558,376
Time 1,063,730 983,261
Total deposits 6,003,138 4,784,349
Short-term borrowings 373,234 162,941
Long-term debt 309,009 367,492
Junior subordinated debt 101,196 75,422
Other liabilities 86,767 69,782
Total liabilities 6,873,344 5,459,986
Total stockholders' equity 795,559 582,273
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 7,668,903 $ 6,042,259
NBT Bancorp Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME
(unaudited, dollars in thousands except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
2013 2012 2013 2012
Interest, fee and dividend income:
Loans $ 61,773 $ 53,817 $ 177,499 $ 154,534
Securities available for sale 6,520 6,550 18,803 21,024
Securities held to maturity 804 572 1,877 1,829
Other 472 348 1,363 1,153
Total interest, fee and dividend income 69,569 61,287 199,542 178,540
Interest expense:
Deposits 3,999 4,544 12,445 14,521
Short-term borrowings 232 60 341 149
Long-term debt 2,561 3,640 9,196 10,801
Trust preferred debt 551 436 1,539 1,319
Total interest expense 7,343 8,680 23,521 26,790
Net interest income 62,226 52,607 176,021 151,750
Provision for loan losses 5,198 4,755 17,258 13,329
Net interest income after provision for loan losses 57,028 47,852 158,763 138,421
Noninterest income:
Insurance and other financial services revenue 6,038 5,591 18,686 17,024
Service charges on deposit accounts 5,055 4,626 14,311 13,538
ATM and debit card fees 4,276 3,378 11,562 9,403
Retirement plan administration fees 3,062 2,718 8,701 7,462
Trust 4,345 2,242 11,957 6,683
Bank owned life insurance income 913 639 2,648 2,228
Net securities gains 329 26 1,413 578
Other 3,129 2,407 8,635 8,449
Total noninterest income 27,147 21,627 77,913 65,365
Noninterest expense:
Salaries and employee benefits 29,267 26,641 85,474 78,358
Occupancy 5,262 4,437 15,458 13,150
Data processing and communications 4,059 3,352 11,368 10,041
Professional fees and outside services 3,202 2,735 9,340 7,848
Equipment 2,988 2,435 8,480 7,224
Office supplies and postage 1,640 1,597 4,886 4,842
FDIC expenses 1,285 939 3,688 2,812
Advertising 722 701 2,445 2,308
Amortization of intangible assets 1,346 870 3,548 2,530
Loan collection and other real estate owned 886 614 2,025 2,051
Merger related 326 558 12,276 1,895
Other operating 5,303 4,552 14,453 12,236
Total noninterest expense 56,286 49,431 173,441 145,295
Income before income taxes 27,889 20,048 63,235 58,491
Income taxes 8,632 5,513 19,413 17,049
Net income $ 19,257 $ 14,535 $ 43,822 $ 41,442
Earnings Per Share:
Basic $ 0.44 $ 0.43 $ 1.06 $ 1.24
Diluted $ 0.44 $ 0.43 $ 1.05 $ 1.23
Note: Year-to-date (YTD) EPS may not equal sum of quarters due to share count differences.
NBT Bancorp Inc. and Subsidiaries
QUARTERLY CONSOLIDATED STATEMENTS OF INCOME
(unaudited, dollars in thousands except per share data)
2013 2012
3rd Q 2nd Q 1st Q 4th Q 3rd Q
Interest, fee and dividend income:
Loans $ 61,773 $ 62,031 $ 53,695 $ 53,924 $ 53,817
Securities available for sale 6,520 6,537 5,746 5,981 6,550
Securities held to maturity 804 548 525 549 572
Other 472 488 403 403 348
Total interest, fee and dividend income 69,569 69,604 60,369 60,857 61,287
Interest expense:
Deposits 3,999 4,296 4,150 4,327 4,544
Short-term borrowings 232 67 42 39 60
Long-term debt 2,561 3,026 3,609 3,627 3,640
Junior subordinated debt 551 560 428 411 436
Total interest expense 7,343 7,949 8,229 8,404 8,680
Net interest income 62,226 61,655 52,140 52,453 52,607
Provision for loan losses 5,198 6,402 5,658 6,940 4,755
Net interest income after provision for loan losses 57,028 55,253 46,482 45,513 47,852
Noninterest income:
Insurance and other financial services revenue 6,038 5,755 6,893 5,363 5,591
Service charges on deposit accounts 5,055 4,933 4,323 4,687 4,626
ATM and debit card fees 4,276 4,044 3,242 2,955 3,378
Retirement plan administration fees 3,062 2,957 2,682 2,635 2,718
Trust 4,345 4,699 2,913 2,489 2,242
Bank owned life insurance income 913 886 849 849 639
Net securities gains (losses) 329 (61) 1,145 21 26
Other 3,129 2,324 3,182 2,963 2,407
Total noninterest income 27,147 25,537 25,229 21,962 21,627
Noninterest expense:
Salaries and employee benefits 29,267 29,160 27,047 26,457 26,641
Occupancy 5,262 5,219 4,977 4,265 4,437
Data processing and communications 4,059 3,854 3,455 3,396 3,352
Professional fees and outside services 3,202 3,237 2,901 2,615 2,735
Equipment 2,988 2,910 2,582 2,403 2,435
Office supplies and postage 1,640 1,656 1,590 1,647 1,597
FDIC expenses 1,285 1,273 1,130 1,020 939
Advertising 722 1,000 723 581 701
Amortization of intangible assets 1,346 1,351 851 864 870
Loan collection and other real estate owned 886 421 718 509 614
Merger 326 1,269 10,681 713 558
Other operating 5,303 5,100 4,050 4,122 4,552
Total noninterest expense 56,286 56,450 60,705 48,592 49,431
Income before income taxes 27,889 24,340 11,006 18,883 20,048
Income taxes 8,632 7,424 3,357 5,767 5,513
Net income $ 19,257 $ 16,916 $ 7,649 $ 13,116 $ 14,535
Earnings per share:
Basic $ 0.44 $ 0.39 $ 0.21 $ 0.39 $ 0.43
Diluted $ 0.44 $ 0.38 $ 0.21 $ 0.39 $ 0.43
Note: Year-to-date (YTD) EPS may not equal sum of quarters due to share count differences.
NBT Bancorp Inc. and Subsidiaries
AVERAGE BALANCE SHEETS
(unaudited, dollars in thousands)
Average Yield / Average Yield / Average Yield / Average Yield / Average Yield /
Balance Rates Balance Rates Balance Rates Balance Rates Balance Rates
Q3 - 2013 Q2 - 2013 Q1 - 2013 Q4 - 2012 Q3 - 2012
ASSETS:
Short-term interest bearing accounts $ 1,955 1.73% $ 41,313 0.57% $ 75,110 0.21% $ 72,660 0.26% $ 10,392 0.43%
Securities available for sale (1)(2) 1,387,714 2.00% 1,428,864 1.97% 1,197,238 2.09% 1,123,110 2.27% 1,168,326 2.39%
Securities held to maturity (1) 118,781 3.54% 62,463 5.23% 52,905 6.06% 60,651 5.42% 62,746 5.46%
Investment in FRB and FHLB Banks 43,895 4.20% 35,497 4.85% 31,312 4.75% 29,801 4.75% 28,706 4.67%
Loans (3) 5,309,446 4.63% 5,243,534 4.76% 4,492,106 4.87% 4,264,680 5.05% 4,197,046 5.12%
Total interest earning assets $ 6,861,791 4.08% $ 6,811,671 4.16% $ 5,848,671 4.25% $ 5,550,902 4.43% $ 5,467,216 4.53%
Other assets 671,482 705,869 554,355 503,124 504,194
Total assets $ 7,533,273 $ 7,517,540 $ 6,403,026 $ 6,054,026 $ 5,971,410
LIABILITIES AND STOCKHOLDERS' EQUITY:
Money market deposit accounts $1,360,067 0.15% $1,402,429 0.15% $1,190,555 0.14% $1,149,248 0.14% $1,111,624 0.18%
NOW deposit accounts 877,387 0.13% 927,037 0.19% 799,219 0.23% 752,737 0.25% 686,768 0.22%
Savings deposits 984,093 0.09% 983,413 0.09% 770,559 0.08% 694,226 0.08% 706,927 0.08%
Time deposits 1,081,549 1.09% 1,136,511 1.10% 1,015,711 1.26% 1,006,581 1.31% 1,035,868 1.35%
Total interest bearing deposits $ 4,303,096 0.37% $ 4,449,390 0.39% $ 3,776,044 0.45% $ 3,602,792 0.48% $ 3,541,187 0.51%
Short-term borrowings 383,238 0.24% 229,906 0.12% 168,783 0.10% 150,372 0.10% 178,277 0.13%
Junior subordinated debentures 101,196 2.16% 101,196 2.22% 82,295 2.11% 75,422 2.17% 75,422 2.30%
Long-term debt 309,069 3.29% 355,702 3.41% 382,177 3.83% 367,312 3.93% 367,146 3.94%
Total interest bearing liabilities $ 5,096,599 0.57% $ 5,136,194 0.62% $ 4,409,299 0.76% $ 4,195,898 0.80% $ 4,162,032 0.83%
Demand deposits 1,559,506 1,496,486 1,283,737 1,210,440 1,173,638
Other liabilities 82,896 78,660 67,297 68,477 64,860
Stockholders' equity 794,272 806,200 642,693 579,211 570,880
Total liabilities and stockholders' equity $ 7,533,273 $ 7,517,540 $ 6,403,026 $ 6,054,026 $ 5,971,410
Interest rate spread 3.51% 3.54% 3.49% 3.63% 3.70%
Net interest margin 3.65% 3.69% 3.68% 3.83% 3.90%
(1) Securities are shown at average amortized cost
(2) Excluding unrealized gains or losses
(3) For purposes of these computations, nonaccrual loans are included in the average loan balances outstanding
NBT Bancorp Inc. and Subsidiaries
CONSOLIDATED LOAN BALANCES
(unaudited, dollars in thousands)
2013
2013 2012 Acquired
3rd Q 2nd Q 1st Q 4th Q 3rd Q Balances *
Residential real estate mortgages $ 1,028,158 $1,001,642 $ 996,925 $ 651,107 $ 650,448 $ 333,105
Commercial 849,095 867,513 829,766 694,799 697,213 179,672
Commercial real estate mortgages 1,302,978 1,241,271 1,233,763 1,072,807 1,083,675 117,752
Real estate construction and development 116,662 152,548 136,402 123,078 99,181 --
Agricultural and agricultural real estate mortgages 110,113 107,565 107,023 112,687 112,822 --
Consumer 1,327,203 1,284,888 1,253,645 1,047,856 1,031,572 200,470
Home equity 633,022 635,283 637,509 575,282 576,208 73,474
Total loans $ 5,367,231 $5,290,710 $5,195,033 $4,277,616 $4,251,119 $ 904,473
* Balances are as of Alliance acquisition date of March 8, 2013

TABLE

CONTACT: Martin A. Dietrich, CEO Michael J. Chewens, CFO NBT Bancorp Inc. 52 South Broad Street Norwich, NY 13815 607-337-6119Source:NBT Bancorp Inc.