Executive Snapshot:

• Continued solid financial results:
  • Net income for the third quarter of 2015 compared to the same period in 2014:
    • Net income of $10.6 million in third quarter of 2015 compared to $10.7 million in third quarter of 2014
    • Operating expenses increased $1.3 million in the third quarter of 2015 compared to the third quarter of 2014
    • Return on average assets (ROA) of 0.88%
    • Return on average equity (ROE) of 10.35%
    • Efficiency ratio of 56.04%
       
• Asset quality improvement:
  • Asset quality measures continued to improve compared to both the third quarter of 2014 and the second quarter of 2015
  • Nonperforming assets (NPAs) fell by $5.7 million when compared to September 30, 2014.
  • NPAs to total assets improved from 0.95% to 0.80% when compared to September 30, 2014.
  • Quarterly net chargeoffs declined to 0.15% of average loans on an annualized basis, compared to 0.20% for the third quarter of 2014.
     
• Continued expansion of customer base:
  • Focus on capitalizing on opportunities presented by expanded branch network
  • Average deposits per branch grew $751 thousand from September 30, 2014 to September 30, 2015 on a same store basis
  • Average core deposits were $103 million higher in the third quarter of 2015 compared to the third quarter of 2014
     
• Loan portfolio reaches all-time high:
  • Average loans were up $218 million for the third quarter of 2015 compared to third quarter of 2014
  • At $3.28 billion as of September 30, 2015, loans reached an all-time high
    
    

GLENVILLE, N.Y., Oct. 21, 2015 (GLOBE NEWSWIRE) -- TrustCo Bank Corp NY (TrustCo) (Nasdaq:TRST) today announced that third quarter of 2015 net income was $10.6 million compared to $10.7 million for the third quarter of 2014.  Despite added operating costs during the third quarter in response to recent regulatory concerns, net income for the quarter was virtually unchanged. 

TrustCo saw continued strong loan growth in the third quarter of 2015.  Loan portfolio expansion was funded by utilization of a portion of the cash flow from the Bank’s investment portfolio.  The rate of growth in average core deposits exceeded the growth rate of total deposit and cash management accounts, which are significantly more costly than core deposits.  The continued shift toward loans helped offset the margin impact from continued comparatively low yields on cash and investments.  TrustCo’s strong liquidity position continues to allow the Company to take advantage of opportunities when interest rate conditions change.

Robert J. McCormick, President and Chief Executive Officer noted, “We are pleased with the continued improvement in our asset quality during both the third quarter and over the last year. Our long-term focus on traditional lending criteria and conservative balance sheet management has enabled us to maintain strong liquidity and capital and allowed us to continue to grow our business and take advantage of changes in market and competitive conditions.”

Mr. McCormick also noted, “We consider our third quarter 2015 results to be solid as we were able to report roughly flat net income despite increased operating costs in response to regulatory concerns.  As we noted in our second quarter earnings press release and related SEC filings, we anticipated higher expenses to fulfill operating and regulatory requirements.  We have taken aggressive action to meet these requirements, resulting in added costs in the third quarter.  While some of these costs will be recurring, others will diminish over time.  In terms of our core business, we continue to make solid progress, adding customer relationships which ultimately position our business well for the future.  Our highly liquid balance sheet continues to allow us to fund our loan growth without having to overpay for deposits.  We look forward to the balance of 2015 and 2016 with optimism.  We will continue taking advantage of opportunities as they are presented.”

For the third quarter of 2015, return on average assets and return on average equity were 0.88% and 10.35%, respectively, compared to 0.92% and 10.96% for the third quarter of 2014.  Reported diluted earnings per share were $0.111 for the third quarter of 2015, compared to $0.113 for the third quarter of 2014. 

For the first nine months of 2015, core diluted net income per share was $0.336, compared to $0.326 for the first nine months of 2014.  GAAP diluted net income per share was $0.337 for the first nine months of 2015, compared to $0.354 for the first nine months of 2014.  Return on average assets and equity were 0.91% and 10.64% for the first nine months of 2015, compared to 0.98% and 11.84% for the first nine months of 2014, all on a GAAP basis.  Non-GAAP measures are defined on pages 13 and 14.

Average loans were up $218.1 million or 7.2% in the third quarter of 2015, over the same period in 2014.  Average deposits were up $144.7 million or 3.6% for the third quarter of 2015 over the same period a year earlier.  Most of the increase in deposits came from core deposit accounts.  Average core deposits increased $103.3 million from the third quarter of 2014 to the third quarter of 2015.  Core deposits typically represent longer term customer relationships and are generally lower cost than time deposits.  Mr. McCormick noted that, “The year-over-year growth of our loans and core deposit base reflect the long term strategic focus of the Company. 

“While some banks have backed away from branches, a customer friendly branch franchise continues to be the key to our long term plans.  We continue to make significant progress expanding loans and deposits throughout our entire branch network.  We expect that trend to continue as the newer branches continue to mature. 

At September 30, 2015, our average branch size was $28.1 million.  On a same store basis, our average deposits per branch grew by $751 thousand from September 30, 2014 to September 30, 2015.  We have always designed our branches to be smaller and more cost effective than those built by many of our competitors.  We use open floor plans that help maximize the value of our branches.  We remain mindful that fully achieving our goals for newer branches will take time and continued work.  We believe success in growing customer relationships provides basic building blocks that will help drive profit growth for the coming years.”

Asset quality and the allowance for loan losses coverage of nonperforming loans (NPLs) improved from both September 30, 2014 and June 30, 2015 to September 30, 2015.  NPLs declined to $31.9 million at September 30, 2015, compared to $37.1 million at September 30, 2014 and $32.5 million at June 30, 2015.  NPLs were equal to 0.97% of total loans at September 30, 2015, compared to 1.20% a year earlier and 1.00% at June 30, 2015.  The coverage ratio, or allowance for loan losses to NPLs, was 141.4% at September 30, 2015, compared to 140.3% at June 30, 2015 and 125.3% at September 30, 2014.  Nonperforming assets (NPAs) declined to $37.8 million at September 30, 2015 from $38.6 million at June 30, 2015 and $43.6 million at September 30, 2014.  Overall, virtually every asset quality indicator improved during the third quarter of 2015 relative to the second quarter of 2015 and the third quarter of 2014.  The ratio of loan loss allowance to total loans was 1.38% as of September 30, 2015, compared to 1.41% at June 30, 2015 and to 1.51% at September 30, 2014 and reflects both the improvement in asset quality and economic conditions in our lending areas.  The allowance for loan losses was $45.1 million at September 30, 2015 compared to $45.6 million at June 30, 2015 and $46.5 million at September 30, 2014.

The net interest margin for the third quarter of 2015 was 3.08% compared to 3.07% in the second quarter of 2015 and 3.16% in the third quarter of 2014. 

At September 30, 2015 the tangible equity ratio was 8.71% compared to 8.48% at June 30, 2015 and 8.49% at September 30, 2014.  The equity to asset ratio was 8.72% at September 30, 2015, compared to 8.49% at June 30, 2015 and 8.50% at September 30, 2014.  Tangible book value per share at September 30, 2015 was $4.33 compared to $4.10 a year earlier and GAAP book value per share was $4.33 and $4.11, respectively.  Non-GAAP measures are defined on pages 13 and 14.

TrustCo Bank Corp NY is a $4.7 billion savings and loan holding company and through its subsidiary, Trustco Bank, operated 146 offices in New York, New Jersey, Vermont, Massachusetts, and Florida at September 30, 2015.

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.

A conference call to discuss third quarter 2015 results will be held at 9:00 a.m. Eastern Time on October 22, 2015.  Those wishing to participate in the call may dial toll-free 1-888-339-0764.  International callers must dial 1-412-902-4195.   Please ask to be joined into the TrustCo Bank Corp NY / TRST call.  A replay of the call will be available for thirty days by dialing 1-877-344-7529 (1-412-317-0088 for international callers), Conference Number 10074396. The call will also be audio webcast at: http://services.choruscall.com/links/trst151022.html, and will be available for one year. 

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 2015 and for the growth of loans and deposits throughout our branch network, our ability to capitalize on economic changes in the areas in which we operate and the extent to which higher expenses to fulfill operating and regulatory requirements recur or diminish over time.  Such forward-looking statements are subject to factors that could cause actual results to differ materially for TrustCo from those discussed. 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:  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 comply with the supervisory agreement entered into with Trustco Bank’s regulator and potential regulatory actions if we fail to comply; 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 Trustco Bank and the continued ability of Trustco Bank under regulatory rules and the supervisory agreement to distribute capital to TrustCo, which could affect our ability to pay dividends; results of examinations of Trustco Bank and TrustCo by our respective regulators; our ability to make accurate assumptions and judgments regarding the credit risks associated with lending and investing activities; the effect of changes in financial services laws and regulations and the impact of other governmental initiatives affecting the financial services industry; the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board, inflation, interest rates, market and monetary fluctuations; 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; real estate and collateral values; changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the FASB or PCAOB; changes in local market areas and general business and economic trends, as well as changes in consumer spending and saving habits; 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 annual report on Form 10-K for the year ended December 31, 2014, as amended, and, if any, in our subsequent quarterly reports on Form 10-Q or other securities filings.

TRUSTCO BANK CORP NY
GLENVILLE, NY
FINANCIAL HIGHLIGHTS
(dollars in thousands, except per share data)
(Unaudited)
					Three Months Ended
		09/30/15			06/30/15			09/30/14
Summary of operations
Net interest income (TE)	$		36,069			35,690			35,676
Provision for loan losses			800			800			1,100
Net securities transactions			-			-			376
Noninterest income, excluding net securities transactions			4,365			4,454			4,514
Noninterest expense			23,464			22,131			22,192
Net income			10,616			10,727			10,714
Per common share
Net income per share:
- Basic	$		0.112			0.113			0.113
- Diluted			0.111			0.113			0.113
Cash dividends			0.066			0.066			0.066
Tangible Book value at period end			4.33			4.23			4.10
Market price at period end			5.84			7.03			6.44
At period end
Full time equivalent employees			778			760			733
Full service banking offices			146			146			143
Performance ratios
Return on average assets			0.88	%		0.91			0.92
Return on average equity			10.35			10.66			10.96
Efficiency (1)			56.04			54.71			52.73
Net interest spread (TE)			3.02			3.01			3.11
Net interest margin (TE)			3.08			3.07			3.16
Dividend payout ratio			58.82			58.15			58.05
Capital ratio at period end
Consolidated tangible equity to tangible assets (2)			8.71			8.48			8.49
Asset quality analysis at period end
Nonperforming loans to total loans			0.97			1.00			1.20
Nonperforming assets to total assets			0.80			0.81			0.95
Allowance for loan losses to total loans			1.38			1.41			1.51
Coverage ratio (3)			1.4x			1.4			1.3
(1)  Calculated as noninterest expense (excluding ORE income/expense) divided by
taxable equivalent net interest income plus noninterest income (excluding
net securities transactions, the net gain on sale of building, and the net sale of nonperforming loans).
(2)  The tangible equity ratio excludes $553 of intangibles from both equity and assets.
(3)  Calculated as allowance for loan losses divided by total nonperforming loans.
TE = Taxable equivalent.
FINANCIAL HIGHLIGHTS, Continued
(dollars in thousands, except per share data)
(Unaudited)
		Nine Months Ended
		09/30/15			09/30/14
Summary of operations
Net interest income (TE)	$		106,944			105,890
Provision for loan losses			2,400			4,100
Net securities transactions			249			382
Noninterest income			13,193			14,772
Noninterest expense			67,452			62,430
Net income			32,058			33,533
Per common share
Net income per share:
- Basic	$		0.337			0.354
- Diluted			0.337			0.354
Cash dividends			0.197			0.197
Tangible Book value at period end			4.33			4.10
Market price at period end			5.84			6.44
Performance ratios
Return on average assets			0.91	%		0.98
Return on average equity			10.64			11.84
Efficiency (1)			54.98			52.35
Net interest spread (TE)			3.01			3.09
Net interest margin (TE)			3.08			3.15
Dividend payout ratio			58.36			55.58
(1)  Calculated as noninterest expense (excluding ORE income/expense) divided by
taxable equivalent net interest income plus noninterest income (excluding
net securities transactions).
TE = Taxable equivalent.
CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except per share data)
(Unaudited)
		Three Months Ended
		9/30/2015			6/30/2015			3/31/2015			12/31/2014			9/30/2014
Interest and dividend income:
Interest and fees on loans	$		35,631			35,343			34,983			35,051			34,421
Interest and dividends on securities available for sale:
U. S. government sponsored enterprises			584			366			212			233			297
State and political subdivisions			23			23			25			29			38
Mortgage-backed securities and collateralized mortgage obligations-residential			2,230			2,276			2,393			2,733			3,040
Corporate bonds			-			-			1			2			2
Small Business Administration-guaranteed participation securities			497			503			522			524			535
Mortgage-backed securities and collateralized mortgage obligations-commercial			37			38			37			37			38
Other securities			4			4			4			4			4
Total interest and dividends on securities available for sale			3,375			3,210			3,194			3,562			3,954
Interest on held to maturity securities:
Mortgage-backed securities and collateralized mortgage obligations-residential			461			480			478			512			545
Corporate bonds			153			154			154			154			153
Total interest on held to maturity securities			614			634			632			666			698
Federal Reserve Bank and Federal Home Loan Bank stock			113			118			116			123			127
Interest on federal funds sold and other short-term investments			408			423			400			363			374
Total interest income			40,141			39,728			39,325			39,765			39,574
Interest expense:
Interest on deposits:
Interest-bearing checking			117			111			105			98			94
Savings			603			599			658			663			644
Money market deposit accounts			537			547			617			634			648
Time deposits			2,544			2,500			2,434			2,366			2,213
Interest on short-term borrowings			290			300			346			335			327
Total interest expense			4,091			4,057			4,160			4,096			3,926
Net interest income			36,050			35,671			35,165			35,669			35,648
Provision for loan losses			800			800			800			1,000			1,100
Net interest income after provision for loan losses			35,250			34,871			34,365			34,669			34,548
Noninterest income:
Trustco Financial Services income			1,351			1,478			1,653			1,451			1,471
Fees for services to customers			2,770			2,691			2,524			2,753			2,838
Net gain on securities transactions			-			-			249			335			376
Other			244			285			197			213			205
Total noninterest income			4,365			4,454			4,623			4,752			4,890
Noninterest expenses:
Salaries and employee benefits			7,834			8,164			8,481			9,003			8,272
Net occupancy expense			3,929			3,878			4,108			3,869			4,013
Equipment expense			1,596			1,803			1,942			1,919			1,725
Professional services			2,238			2,066			1,507			1,536			1,547
Outsourced services			1,425			1,425			1,425			1,225			1,375
Advertising expense			668			733			600			602			629
FDIC and other insurance			2,202			1,017			1,065			949			1,054
Other real estate expense, net			806			201			424			841			1,001
Other			2,766			2,844			2,305			2,296			2,576
Total noninterest expenses			23,464			22,131			21,857			22,240			22,192
Income before taxes			16,151			17,194			17,131			17,181			17,246
Income taxes			5,535			6,467			6,416			6,521			6,532
Net income	$		10,616			10,727			10,715			10,660			10,714
Net income per common share:
- Basic	$		0.112			0.113			0.113			0.113			0.113
- Diluted			0.111			0.113			0.113			0.112			0.113
Average basic shares (in thousands)			95,149			95,056			94,947			94,681			94,628
Average diluted shares (in thousands)			95,234			95,190			95,074			94,813			94,752
Note:  Taxable equivalent net interest income	$		36,069			35,690			35,185			35,693			35,676
CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except per share data)
(Unaudited)
		Nine Months Ended
		9/30/2015			9/30/2014
Interest and dividend income:
Interest and fees on loans	$		105,957			100,909
Interest and dividends on securities available for sale:
U. S. government sponsored enterprises			1,162			1,184
State and political subdivisions			71			150
Mortgage-backed securities and collateralized mortgage obligations-residential			6,899			9,417
Corporate bonds			1			63
Small Business Administration-guaranteed participation securities			1,522			1,630
Mortgage-backed securities and collateralized mortgage obligations-commercial			112			114
Other securities			12			12
Total interest and dividends on securities available for sale			9,779			12,570
Interest on held to maturity securities:
Mortgage-backed securities-residential			1,419			1,747
Corporate bonds			461			461
Total interest on held to maturity securities			1,880			2,208
Federal Reserve Bank and Federal Home Loan Bank stock			347			388
Interest on federal funds sold and other short-term investments			1,231			1,101
Total interest income			119,194			117,176
Interest expense:
Interest on deposits:
Interest-bearing checking			333			267
Savings			1,860			1,999
Money market deposit accounts			1,701			1,865
Time deposits			7,478			6,199
Interest on short-term borrowings			936			1,062
Total interest expense			12,308			11,392
Net interest income			106,886			105,784
Provision for loan losses			2,400			4,100
Net interest income after provision for loan losses			104,486			101,684
Noninterest income:
Trust department income			4,482			4,386
Fees for services to customers			7,985			8,091
Net gain on securities transactions			249			382
Other			726			2,295
Total noninterest income			13,442			15,154
Noninterest expenses:
Salaries and employee benefits			24,479			23,876
Net occupancy expense			11,915			12,382
Equipment expense			5,341			5,300
Professional services			5,811			4,271
Outsourced services			4,275			4,125
Advertising expense			2,001			1,885
FDIC and other insurance			4,284			2,958
Other real estate expense, net			1,431			168
Other			7,915			7,465
Total noninterest expenses			67,452			62,430
Income before taxes			50,476			54,408
Income taxes			18,418			20,875
Net income	$		32,058			33,533
Net income per Common Share:
- Basic	$		0.337			0.354
- Diluted			0.337			0.354
Average basic shares (thousands)			95,051			94,562
Average diluted shares (thousands)			95,167			94,685
Note:  Taxable equivalent net interest income	$		106,944			105,890
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(dollars in thousands)
(Unaudited)
		9/30/2015			6/30/2015			3/31/2015			12/31/2014			9/30/2014
ASSETS:
Cash and due from banks	$		42,560			37,574			44,853			43,505			43,724
Federal funds sold and other short term investments			655,512			641,011			705,273			627,943			586,931
Total cash and cash equivalents			698,072			678,585			750,126			671,448			630,655
Securities available for sale:
U. S. government sponsored enterprises			103,492			152,082			108,248			77,800			83,087
States and political subdivisions			1,963			1,969			1,974			2,271			2,769
Mortgage-backed securities and collateralized mortgage obligations-residential			413,878			429,205			445,273			483,560			523,779
Corporate bonds			-			-			1,500			1,500			1,401
Small Business Administration-guaranteed participation securities			94,038			95,323			98,668			100,496			100,491
Mortgage-backed securities and collateralized mortgage obligations-commercial			10,491			10,399			10,503			10,447			10,417
Other securities			685			685			685			685			679
Total securities available for sale			624,547			689,663			666,851			676,759			722,623
Held to maturity securities:
Mortgage-backed securities and collateralized mortgage obligations-residential			50,027			53,576			57,296			60,986			64,223
Corporate bonds			9,971			9,967			9,964			9,960			9,956
Total held to maturity securities			59,998			63,543			67,260			70,946			74,179
Federal Reserve Bank and Federal Home Loan Bank stock			9,480			9,480			9,228			9,228			9,228
Loans:
Commercial			208,794			209,399			212,145			223,382			219,825
Residential mortgage loans			2,707,944			2,669,929			2,620,925			2,575,222			2,510,151
Home equity line of credit			356,337			354,946			352,552			352,134			346,496
Installment loans			8,930			8,674			8,003			7,594			6,557
Loans, net of deferred fees and costs			3,282,005			3,242,948			3,193,625			3,158,332			3,083,029
Less:
Allowance for loan losses			45,149			45,571			45,944			46,327			46,512
Net loans			3,236,856			3,197,377			3,147,681			3,112,005			3,036,517
Bank premises and equipment, net			37,506			38,100			38,812			38,565			37,455
Other assets			59,358			64,589			60,698			65,488			71,609
Total assets	$		4,725,817			4,741,337			4,740,656			4,644,439			4,582,266
LIABILITIES:
Deposits:
Demand	$		354,162			355,783			347,315			331,425			327,527
Interest-bearing checking			719,071			713,001			696,137			682,210			646,862
Savings accounts			1,237,549			1,250,154			1,237,115			1,216,831			1,215,087
Money market deposit accounts			617,103			633,239			640,368			638,542			655,646
Time deposits			1,168,908			1,185,264			1,196,233			1,163,233			1,139,919
Total deposits			4,096,793			4,137,441			4,117,168			4,032,241			3,985,041
Short-term borrowings			184,405			170,750			194,738			189,116			179,957
Accrued expenses and other liabilities			32,327			30,687			28,274			29,638			27,781
Total liabilities			4,313,525			4,338,878			4,340,180			4,250,995			4,192,779
SHAREHOLDERS' EQUITY:
Capital stock			98,964			98,964			98,964			98,945			98,942
Surplus			171,788			171,988			172,237			172,353			172,598
Undivided profits			180,093			175,721			171,232			166,745			162,326
Accumulated other comprehensive loss, net of tax			(1,174	)		(5,927	)		(2,687	)		(4,509	)		(3,508	)
Treasury stock at cost			(37,379	)		(38,287	)		(39,270	)		(40,090	)		(40,871	)
Total shareholders' equity			412,292			402,459			400,476			393,444			389,487
Total liabilities and shareholders' equity	$		4,725,817			4,741,337			4,740,656			4,644,439			4,582,266
Outstanding shares (in thousands)			95,149			95,056			94,956			94,857			94,785

 

NONPERFORMING ASSETS
(dollars in thousands)
(Unaudited)
Nonperforming Assets
		09/30/15			06/30/15			03/31/15			12/31/14			09/30/14
New York and other states*
Loans in nonaccrual status:
Commercial	$		3,699			3,263			2,489			3,835			4,226
Real estate mortgage - 1 to 4 family			26,059			27,366			28,215			27,221			29,736
Installment			69			79			77			77			95
Total non-accrual loans			29,827			30,708			30,781			31,133			34,057
Other nonperforming real estate mortgages - 1 to 4 family			50			74			75			125			155
Total nonperforming loans			29,877			30,782			30,856			31,258			34,212
Other real estate owned			5,893			5,833			6,288			5,533			5,238
Total nonperforming assets	$		35,770			36,615			37,144			36,791			39,450
Florida
Loans in nonaccrual status:
Commercial	$		-			-			-			-			517
Real estate mortgage - 1 to 4 family			2,054			1,678			2,608			2,740			2,395
Installment			9			10			20			13			1
Total non-accrual loans			2,063			1,688			2,628			2,753			2,913
Other nonperforming real estate mortgages - 1 to 4 family			-			-			-			-			-
Total nonperforming loans			2,063			1,688			2,628			2,753			2,913
Other real estate owned			-			275			670			908			1,188
Total nonperforming assets	$		2,063			1,963			3,298			3,661			4,101
Total
Loans in nonaccrual status:
Commercial	$		3,699			3,263			2,489			3,835			4,743
Real estate mortgage - 1 to 4 family			28,113			29,044			30,823			29,961			32,131
Installment			78			89			97			90			96
Total non-accrual loans			31,890			32,396			33,409			33,886			36,970
Other nonperforming real estate mortgages - 1 to 4 family			50			74			75			125			155
Total nonperforming loans			31,940			32,470			33,484			34,011			37,125
Other real estate owned			5,893			6,108			6,958			6,441			6,426
Total nonperforming assets	$		37,833			38,578			40,442			40,452			43,551
Quarterly Net Chargeoffs (Recoveries)
		09/30/15			06/30/15			03/31/15			12/31/14			09/30/14
New York and other states*
Commercial	$		3			50			34			(16	)		124
Real estate mortgage - 1 to 4 family			1,159			933			1,004			1,591			1,105
Installment			26			24			37			48			57
Total net chargeoffs	$		1,188			1,007			1,075			1,623			1,286
Florida
Commercial	$		(3	)		(1	)		(1	)		(476	)		(1	)
Real estate mortgage - 1 to 4 family			33			167			109			37			242
Installment			4			-			-			1			(4	)
Total net chargeoffs	$		34			166			108			(438	)		237
Total
Commercial	$		-			49			33			(492	)		123
Real estate mortgage - 1 to 4 family			1,192			1,100			1,113			1,628			1,347
Installment			30			24			37			49			53
Total net chargeoffs	$		1,222			1,173			1,183			1,185			1,523
Asset Quality Ratios
		09/30/15			06/30/15			03/31/15			12/31/14			09/30/14
Total nonperforming loans(1)	$		31,940			32,470			33,484			34,011			37,125
Total nonperforming assets(1)			37,833			38,578			40,442			40,452			43,551
Total net chargeoffs(2)			1,222			1,173			1,183			1,185			1,523
Allowance for loan losses(1)			45,149			45,571			45,944			46,327			46,512
Nonperforming loans to total loans			0.97	%		1.00	%		1.05	%		1.08	%		1.20	%
Nonperforming assets to total assets			0.80	%		0.81	%		0.85	%		0.87	%		0.95	%
Allowance for loan losses to total loans			1.38	%		1.41	%		1.44	%		1.47	%		1.51	%
Coverage ratio(1)			141.4	%		140.3	%		137.2	%		136.2	%		125.3	%
Annualized net chargeoffs to average loans(2)			0.15	%		0.15	%		0.15	%		0.15	%		0.20	%
Allowance for loan losses to annualized net chargeoffs(2)		9.3x			9.7x			9.6x			9.8x			7.6x
* Includes New York, New Jersey, Vermont and Massachusetts.
(1)  At period-end
(2)  For the period ended

 

DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY-
INTEREST RATES AND INTEREST DIFFERENTIAL
(dollars in thousands)		Three months ended										Three months ended
(Unaudited)		September 30, 2015										September 30, 2014
		Average				Interest			Average			Average				Interest			Average
		Balance							Rate			Balance							Rate
Assets
Securities available for sale:
U. S. government sponsored enterprises	$		157,454				584		1.48	%	$		93,098				297		1.27	%
Mortgage backed securities and
collateralized mortgage obligations-residential			425,092				2,230		2.10				569,352				3,040		2.14
State and political subdivisions			1,937				34		7.02				3,307				60		7.26
Corporate bonds			-				-		0.00				1,403				2		0.48
Small Business Administration-guaranteed participation securities			96,109				497		2.07				106,109				535		2.02
Mortgage backed securities and
collateralized mortgage obligations-commercial			10,532				37		1.41				10,803				38		1.40
Other			685				4		2.34				685				4		2.34
Total securities available for sale			691,809				3,386		1.96				784,757				3,976		2.03
Federal funds sold and other
short-term Investments			652,274				408		0.25				598,318				374		0.25
Held to maturity securities:
Corporate bonds			9,969				153		6.17				9,954				153		6.18
Mortgage backed securities and
collateralized mortgage obligations-residential			51,928				461		3.55				66,206				545		3.29
Total held to maturity securities			61,897				614		3.97				76,160				698		3.67
Federal Reserve Bank and Federal Home Loan Bank stock			9,480				113		4.77				9,884				127		5.14
Commercial loans			208,492				2,688		5.15				220,347				2,842		5.16
Residential mortgage loans			2,689,072				29,617		4.41				2,473,857				28,315		4.58
Home equity lines of credit			354,552				3,151		3.53				342,456				3,102		3.59
Installment loans			8,678				183		8.33				6,048				168		11.02
Loans, net of unearned income			3,260,794				35,639		4.37				3,042,708				34,427		4.52
Total interest earning assets			4,676,254				40,160		3.43				4,511,827				39,602		3.51
Allowance for loan losses			(45,829	)									(47,115	)
Cash & non-interest earning assets			133,241										134,110
Total assets	$		4,763,666								$		4,598,822
Liabilities and shareholders' equity
Deposits:
Interest bearing checking accounts	$		727,693				117		0.06	%	$		650,132				94		0.06	%
Money market accounts			623,381				537		0.34				656,935				648		0.39
Savings			1,251,031				603		0.19				1,229,712				644		0.21
Time deposits			1,189,763				2,544		0.85				1,148,419				2,213		0.76
Total interest bearing deposits			3,791,868				3,801		0.40				3,685,198				3,599		0.39
Short-term borrowings			177,230				290		0.65				180,063				327		0.72
Total interest bearing liabilities			3,969,098				4,091		0.41				3,865,261				3,926		0.40
Demand deposits			360,080										322,083
Other liabilities			27,524										23,783
Shareholders' equity			406,964										387,695
Total liabilities and shareholders' equity	$		4,763,666								$		4,598,822
Net interest income, tax equivalent							36,069										35,676
Net interest spread									3.02	%									3.11	%
Net interest margin (net interest income
to total interest earning assets)									3.08	%									3.16	%
Tax equivalent adjustment							(19	)									(28	)
Net interest income							36,050										35,648
DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY-
INTEREST RATES AND INTEREST DIFFERENTIAL
(dollars in thousands)		Nine months ended										Nine months ended
(Unaudited)		September 30, 2015										September 30, 2014
		Average				Interest			Average			Average				Interest			Average
		Balance							Rate			Balance							Rate
Assets
Securities available for sale:
U. S. government sponsored enterprises	$		116,824				1,162		1.33	%	$		124,133				1,184		1.27	%
Mortgage backed securities and
collateralized mortgage obligations-residential			448,223				6,899		2.05				568,257				9,417		2.21
State and political subdivisions			1,989				108		7.32				4,411				235		7.10
Corporate bonds			813				1		0.16				3,758				63		2.23
Small Business Administration-guaranteed participation securities			98,868				1,522		2.05				108,078				1,630		2.01
Mortgage backed securities and
collateralized mortgage obligations-commercial			10,600				112		1.41				10,870				114		1.40
Other			685				12		2.34				670				12		2.39
Total securities available for sale			678,002				9,816		1.93				820,177				12,655		2.06
Federal funds sold and other
short-term Investments			662,879				1,231		0.25				593,577				1,101		0.25
Held to maturity securities:
Corporate bonds			9,965				461		6.17				9,950				461		6.18
Mortgage backed securities and
collateralized mortgage obligations-residential			55,569				1,419		3.41				70,273				1,747		3.31
Total held to maturity securities			65,534				1,880		3.83				80,223				2,208		3.67
Federal Reserve Bank and Federal Home Loan Bank stock			9,392				347		4.93				10,438				388		4.96
Commercial loans			212,617				8,194		5.14				221,492				8,481		5.11
Residential mortgage loans			2,644,216				87,946		4.44				2,410,435				82,845		4.59
Home equity lines of credit			353,630				9,304		3.52				341,014				9,102		3.57
Installment loans			8,236				534		8.66				5,825				502		11.52
Loans, net of unearned income			3,218,699				105,978		4.39				2,978,766				100,930		4.52
Total interest earning assets			4,634,506				119,252		3.43				4,483,181				117,282		3.49
Allowance for loan losses			(46,203	)									(47,570	)
Cash & non-interest earning assets			136,906										133,456
Total assets	$		4,725,209								$		4,569,067
Liabilities and shareholders' equity
Deposits:
Interest bearing checking accounts	$		704,323				333		0.06	%	$		629,542				267		0.06	%
Money market accounts			632,143				1,701		0.36				652,886				1,865		0.38
Savings			1,243,544				1,860		0.20				1,231,761				1,999		0.22
Time deposits			1,186,846				7,478		0.84				1,144,164				6,199		0.72
Total interest bearing deposits			3,766,856				11,372		0.40				3,658,353				10,330		0.38
Short-term borrowings			184,079				936		0.68				190,599				1,062		0.74
Total interest bearing liabilities			3,950,935				12,308		0.42				3,848,952				11,392		0.40
Demand deposits			344,606										318,306
Other liabilities			26,689										23,074
Shareholders' equity			402,979										378,735
Total liabilities and shareholders' equity	$		4,725,209								$		4,569,067
Net interest income, tax equivalent							106,944										105,890
Net interest spread									3.01	%									3.09	%
Net interest margin (net interest income
to total interest earning assets)									3.08	%									3.15	%
Tax equivalent adjustment							(58	)									(106	)
Net interest income							106,886										105,784

Non-GAAP Financial Measures Reconciliation

Tangible book value per share and tangible equity as a percentage of tangible assets at period end are non-GAAP financial measures 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 book value per share by dividing tangible equity by common shares outstanding, as compared to book value per common share, which we calculate by dividing shareholders’ equity by common shares outstanding. 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 a building, nonperforming loans and securities from this calculation.  We believe that this provides a reasonable measure of primary banking expenses relative to primary banking revenue. 

Core net income (“core earnings”) and core net income (“core earnings”) per share are non-GAAP financial measures derived from GAAP-based amounts. We calculate core earnings by excluding the net after-tax gain on the sale of the proposed Florida operations building, the net after-tax gain on a significant sale of an ORE property and net after-tax gains on the sale of non-performing loans from net income and from net income per share.  We believe that this provides a reasonable measure of core net income (earnings).

We believe that these non-GAAP financial measures provide information that is important to investors and that is useful in understanding our financial position, results and ratios. Our management internally assesses our performance based, in part, on these measures.  However, these non-GAAP financial measures are supplemental and are 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.

 

NON-GAAP FINANCIAL MEASURES RECONCILIATION
(dollars in thousands, except per share amounts)
(Unaudited)
		09/30/15			06/30/15			09/30/14
Tangible Book Value Per Share
Equity	$		412,292			402,459			389,487
Less: Intangible assets			553			553			553
Tangible equity			411,739			401,906			388,934
Shares outstanding			95,149			95,056			94,785
Tangible book value per share			4.33			4.23			4.10
Book value per share			4.33			4.23			4.11
Tangible Equity to Tangible Assets
Total Assets			4,725,817			4,741,337			4,582,266
Less: Intangible assets			553			553			553
Tangible assets			4,725,264			4,740,784			4,581,713
Tangible Equity to Tangible Assets			8.71	%		8.48	%		8.49	%
Equity to Assets			8.72	%		8.49	%		8.50	%
		3 Months Ended										9 Months Ended
Efficiency Ratio		09/30/15			06/30/15			09/30/14				09/30/15			09/30/14
Net interest income	$		36,050			35,671			35,648				106,886			105,784
Taxable equivalent adjustment			19			19			28				58			106
Net interest income (fully taxable equivalent)			36,069			35,690			35,676				106,944			105,890
Non-interest income			4,365			4,454			4,890				13,442			15,154
Less:  Net gain on sale of building and nonperforming loans			-			60			-				60			1,719
Less:  Net gain on securities			-			-			376				249			382
Revenue used for efficiency ratio			40,434			40,084			40,190				120,077			118,943
Total noninterest expense			23,464			22,131			22,192				67,452			62,430
Less:  Other real estate expense, net			806			201			1,001				1,431			168
Expense used for efficiency ratio			22,658			21,930			21,191				66,021			62,262
Efficiency Ratio			56.04	%		54.71	%		52.73	%			54.98	%		52.35	%
		3 Months Ended										9 Months Ended
Core Net Income		09/30/15			06/30/15			09/30/14				09/30/15			09/30/14
Net income	$		10,616			10,727			10,714				32,058			33,533
Less:  Gain on sale of building, nonperforming loans, and significant ORE gain, net of tax			-			37			-				37			2,684
Core net income			10,616			10,690			10,714				32,021			30,849
Average basic shares outstanding (in thousands)			95,149			95,056			94,628				95,051			94,562
Average diluted shares outstanding (in thousands)			95,234			95,190			94,752				95,167			94,685
Net income per common share:
- Basic	$		0.112			0.113			0.113				0.337			0.355
- Diluted			0.111			0.113			0.113				0.337			0.354
Core net income per common share:
- Basic	$		0.112			0.112			0.113				0.337			0.326
- Diluted			0.111			0.112			0.113				0.336			0.326

 

 

Kevin T. Timmons
Vice President/Treasurer
(518) 381-3607

Legal Disclaimer:

EIN Presswire provides this news content "as is" without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the author above.