GLENVILLE, N.Y., Oct. 21, 2021 (GLOBE NEWSWIRE) -- TrustCo Bank Corp NY (TrustCo, NASDAQ: TRST) today announced third quarter 2021 net income of $16.8 million or $0.871 diluted earnings per share, compared to net income of $14.1 million or $0.730 diluted earnings per share for the third quarter 2020; and net income of $45.3 million or $2.349 diluted earnings per share for the nine months ended September 30, 2021, compared to net income of $38.6 million or $2.001 diluted earnings per share for the nine months ended September 30, 2020.   For all periods presented, share and per share information has been adjusted for the 1 for 5 reverse stock split which occurred on May 28, 2021.                      

Overview

Robert J. McCormick, Chairman, President and Chief Executive Officer noted, “Our continued strong financial results announced today are the foundation upon which we continue to build. With an always-sharp focus on new business opportunities, we have identified increasing demand for our hallmark mortgage products and have expanded our lending areas in Northern New Jersey and on both coasts of Florida. As part of these initiatives, we deployed a new mortgage loan originator in New Jersey, opened a new full-service branch location in Palm Coast, Florida, and are launching a new channel for the delivery of our core lending products by opening a loan origination office in Naples, Florida.”

In September, the Company announced the addition of Curtis N. Powell to the boards of directors of TrustCo and its subsidiary, Trustco Bank. Mr. Powell is Vice President for Human Resources and Environmental Health, Safety, and Risk Management at Rensselaer Polytechnic Institute in Troy, New York. Mr. Powell adds depth to our board talent pool in the areas of human capital and risk management. Chairman McCormick said “Our success-oriented approach extends from our business lines to our boardroom. Curtis Powell shares our commitment to excellence, and we have every confidence that he will be a tremendous asset as the Company navigates the highly dynamic labor market that we now see across our entire business footprint.”

Mr. McCormick also congratulated the employees of Trustco Bank on receiving well-deserved recognition. He said “Our management team knows that our people are the best in the business, but recently Trustco Bank has been rated ‘Best Of’ in several categories by local media outlets. Our team members can be justifiably proud of this recognition.” Trustco Bank also celebrated 65 years of success at its Mayfair Branch in Glenville, New York and, for the 15th straight year, turned out a formidable team for the Workforce Team Challenge with 75 entrants in the annual 3.5 mile race, held this year in Altamont, New York.

Details

Average loans were up $176.4 million or 4.2% in the third quarter 2021 over the same period in 2020. Average residential loans, our primary lending focus, were up $218.2 million, or 5.9%, in the third quarter 2021 over the same period in 2020. As of September 30, 2021, loans in deferral were not material. Additionally, the Bank had funded 663 Paycheck Protection Program (“PPP”) loans totaling $46 million in 2020, and an additional 344 loans totaling $23 million in 2021. As of September 30, 2021, 349 PPP loans totaling $21 million remain outstanding. Average deposits were up $348.2 million or 7.1% for the third quarter 2021 over the same period a year earlier. The increase in deposits was the result of a $551.2 million or 15.5% increase in total average core deposit accounts, which consist of interest bearing and non-interest bearing checking, savings and money market deposits, offset by a decrease in average time deposits of $202.9 million or 15.0%, for the third quarter 2021 over the same period in 2020. Within the core deposits, checking balances were up $287.2 million or 17.4% (including interest bearing and non-interest bearing checking balances), money market balances were up $56.3 million or 8.3%, and savings balances were up $207.6 million or 17.0%.   We believe the increase in core deposits continues to reflect the desire of customers to have additional funds in the safety and security offered by TrustCo’s long history of conservative banking. As we move forward, the objective is to encourage customers to retain these additional funds in the expanded product offerings of the Bank through aggressive marketing and product differentiation.  

The cost of interest bearing liabilities decreased to 0.15% in the third quarter 2021 from 0.52% in the third quarter 2020. A significant portion of our CD portfolio (time deposits) repriced during the last year, which resulted in lower rates as a result of the ongoing market conditions. The net interest margin for the third quarter 2021 was 2.65%, down 8 basis points from 2.73% in the third quarter of 2020. Net interest income (TE) increased by 4.5% or $1.7 million over the same period last year.   

The Bank continued to demonstrate its ability to grow shareholders’ equity as average equity was up $25.8 million or 4.6% in the third quarter of 2021 compared to the same period in 2020. Return on average assets and return on average equity for the third quarter 2021 were 1.08% and 11.40%, respectively, compared to 0.98% and 10.04% for the third quarter 2020. Improving efficiencies to reduce costs continues to remain a key area of focus. As a result, full time equivalent employees decreased from the prior year and quarter partially due to a strategic realignment and the impact of COVID-19 on the labor market. The Bank also purchased 50 thousand shares of stock in the third quarter of 2021 under the previously announced stock repurchase plan. Additionally, on May 28, 2021, the reverse split of the Company’s Common Stock at a ratio of 1 for 5 was implemented on the Nasdaq Global Select Market. All prior period share and per share information, and common stock and surplus amounts have been split adjusted. The board of directors believes that the Reverse Stock Split will likely result in a higher per share trading price, which is intended to generate greater investor interest in TrustCo and improve the marketability of the shares to a broader range of investors. The board of directors also believes that the Reverse Stock Split will result in a number of our shares of outstanding common stock that is similar to the number of outstanding shares of common stock of comparable financial institutions.   

Asset quality and loan loss reserve measures have continued to improve as a result of low levels of nonperforming assets and chargeoffs. Nonperforming loans (NPLs) were $20.2 million at September 30, 2021, compared to $21.8 million at September 30, 2020. NPLs were 0.46% and 0.52% of total loans at September 30, 2021 and 2020, respectively. The coverage ratio, or allowance for loan losses to NPLs, was 234.7% at September 30, 2021, compared to 225.4% at September 30, 2020. Nonperforming assets (NPAs) were $20.7 million at September 30, 2021, compared to $22.2 million at September 30, 2020. The ratio of allowance for loan losses to total loans was 1.08% as of September 30, 2021 compared to 1.17% as of September 30, 2020. The allowance for loan losses was $47.4 million at September 30, 2021, compared to $49.1 million at September 30, 2020. During 2020, management increased certain allowance qualitative factors based on its assessment of the impact of the current pandemic on local, national, and global economic conditions as well as the perceived risks inherent in specific industries and credit characteristics. Based on this approach, the Company adjusted the pandemic specific provision for the third quarter of 2021. Provision for loan losses for the third quarter of 2021 was a credit of $2.8 million compared to a provision for loan losses for the third quarter of 2020 of $1.0 million. The decrease from the prior year is due to the sustained improvement in asset quality trends and economic conditions during the third quarter. The Company had previously elected to delay its adoption of Accounting Standards Update 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“CECL”), as provided by the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) until the date on which the National Emergency concerning COVID-19 was terminated or December 31, 2020, whichever occurred first.  The December 31, 2020 adoption date under the CARES Act was extended to January 1, 2022 as a part of the COVID-19 relief legislation, which became law in December 2020, and therefore the Company intends to adopt CECL on January 1, 2022.

Net chargeoffs for the third quarter 2021 were $5 thousand versus net chargeoffs in the third quarter 2020 of $21 thousand. The annualized net chargeoffs ratio was 0.00% for the third quarter 2021 and 2020.

At September 30, 2021 the equity to asset ratio was 9.56%, compared to 9.77% at September 30, 2020. Book value per share at September 30, 2021 was $30.50, up 5.1% compared to $29.03 a year earlier.

TrustCo Bank Corp NY is a $6.1 billion savings and loan holding company and through its subsidiary, Trustco Bank, operated 147 offices in New York, New Jersey, Vermont, Massachusetts, and Florida at September 30, 2021.

In addition, the Bank’s Financial Services Department offers a full range of investment services, retirement planning and trust and estate administration services. The common shares of TrustCo are traded on the NASDAQ Global Select Market under the symbol TRST.

Those wishing to participate in the call may dial toll-free for the United States at 1-844-200-6205, for Canada at 1-833-950-0062, and all other locations at 1-929-526-1599, Access code 817092. A replay of the call will be available for thirty days by dialing toll-free for the United States at 1-866-813-9403, for Canada at 1-226-828-7578, and all other locations at +44-204-525-0658, Access code 539783.   The call will also be audio webcast at https://services.choruscall.com/links/trst211022.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 2021, including our expectations regarding the effects of COVID-19 on our financial results and our ability to assist our customers in addressing the effects of COVID-19, our expectations with respect to our expansion initiatives in New Jersey and Florida, our ability to retain customers, the impact of Federal Reserve actions regarding interest rates and the growth of loans and deposits throughout our branch network and our ability to capitalize on economic changes in the areas in which we operate. Such forward-looking statements are subject to factors that could cause actual results to differ materially for TrustCo from those discussed, and many of the risks and uncertainties are heightened by or may, in the future, be heightened by the effects of the COVID-19 pandemic. TrustCo wishes to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The following important factors, among others, in some cases have affected and in the future could affect TrustCo’s actual results and could cause TrustCo’s actual financial performance to differ materially from that expressed in any forward-looking statement: the effect of the COVID-19 pandemic on our business, financial condition, liquidity and results of operations; the impact of the actions taken by governmental authorities to contain COVID-19 or address the impact of COVID-19 on the economy, and the effect of all of such items on our operations, liquidity and capital position, and on the financial condition of our borrowers and other customers; future business strategies related to the implementation of CECL; our ability to continue to originate a significant volume of one-to-four family mortgage loans in our market areas; our ability to continue to maintain noninterest expense and other overhead costs at reasonable levels relative to income; our ability to make accurate assumptions and judgments regarding the credit risks associated with lending and investing activities; 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; restrictions or conditions imposed by our regulators on our operations that may make it more difficult for us to achieve our goals; the future earnings and capital levels of us and Trustco Bank and the continued receipt of approvals from our primary federal banking regulators under regulatory rules to distribute capital to TrustCo, which could affect our ability to pay dividends; results of supervisory monitoring or examinations of Trustco Bank and TrustCo by our respective regulators; adverse conditions in the securities markets that lead to impairment in the value of securities in our investment portfolio; unanticipated effects from the Tax Cut and Jobs Act that may limit its benefits or adversely impact our business; the perceived overall value of our products and services by users, including in comparison to competitors’ products and services and the willingness of current and prospective customers to substitute competitors’ products and services for our products and services; changes in consumer spending, borrowing and saving habits; the effect of changes in financial services laws and regulations and the impact of other governmental initiatives affecting the financial services industry; changes in management personnel; real estate and collateral values; changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the FASB or PCAOB; disruptions, security breaches, or other adverse events affecting the third-party vendors who perform several of our critical processing functions; technological changes and electronic, cyber and physical security breaches; 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 most recent annual report on Form 10-K and, if any, in our subsequent quarterly reports on Form 10-Q or other securities filings.

Subsidiary:Trustco Bank
  
Contact:Robert Leonard
Executive Vice President and        
Chief Risk Officer
(518) 381-3693


TRUSTCO BANK CORP NY    
GLENVILLE, NY    
     
FINANCIAL HIGHLIGHTS    
     
(dollars in thousands, except per share data)    
(Unaudited)    
  Three months ended    
  9/30/2021  6/30/2021  9/30/2020     
Summary of operations          
Net interest income (TE)$39,888  40,122  38,166     
(Credit) Provision for loan losses (2,800) -  1,000     
Noninterest income 4,295  4,688  4,341     
Noninterest expense 24,697  25,440  22,674     
Net income 16,762  14,433  14,071     
           
Per share (4)          
Net income per share:          
- Basic$0.871  0.749  0.730     
- Diluted 0.871  0.748  0.730     
Cash dividends 0.341  0.341  0.341     
Book value at period end 30.50  30.00  29.03      
Market price at period end 31.97  34.38  26.10     
           
At period end          
Full time equivalent employees 743  769  771     
Full service banking offices 147  147  148     
           
Performance ratios          
Return on average assets 1.08 %0.95  0.98     
Return on average equity 11.40  10.05  10.04     
Efficiency (1) 55.82  56.91  53.61     
Net interest spread (TE) 2.62  2.66  2.63     
Net interest margin (TE) 2.65  2.70  2.73     
Dividend payout ratio 39.13  45.51  46.68     
           
Capital ratios at period end          
Consolidated tangible equity to tangible assets (2) 9.55 %9.44  9.76     
Consolidated equity to assets 9.56 %9.45  9.77     
           
Asset quality analysis at period end          
Nonperforming loans to total loans 0.46  0.48  0.52     
Nonperforming assets to total assets 0.34  0.34  0.39     
Allowance for loan losses to total loans 1.08  1.15  1.17     
Coverage ratio (3) 2.3x 2.4x 2.3x    
           
(1) Non-GAAP measure; calculated as noninterest expense (excluding ORE income/expense) divided by taxable equivalent net interest income plus noninterest income. See Non-GAAP Financial Measures Reconciliation.
(2) Non-GAAP measure; calculated as total equity less $553 of intangible assets divided by total assets less $553 of intangible assets. See Non-GAAP Financial Measures Reconciliation.
(3) Calculated as allowance for loan losses divided by total nonperforming loans.
(4) All periods presented have been adjusted for the 1 for 5 reverse stock split which occurred on May 28, 2021.
    
TE = Taxable equivalent
           
           
FINANCIAL HIGHLIGHTS, Continued   
    
(dollars in thousands, except per share data)   
(Unaudited)   
  Nine months ended      
  09/30/21  09/30/20       
Summary of operations          
Net interest income (TE)$120,117  114,401       
(Credit) Provision for loan losses (2,450) 5,000       
Net gain on securities transactions -  1,155       
Noninterest income, excluding net gain on securities transactions 13,411  11,946       
Noninterest expense 75,472  70,874       
Net income 45,278  38,638       
           
Per share (2)          
Net income per share:          
- Basic$2.349  2.002       
- Diluted 2.349  2.001       
Cash dividends 1.022  1.022       
Book value at period end 30.50  29.03       
Market price at period end 31.97  26.10       
           
Performance ratios          
Return on average assets 1.00  0.94       
Return on average equity 10.50  9.38       
Efficiency (1) 56.36  56.06       
Net interest spread (TE) 2.67  2.74       
Net interest margin (TE) 2.71  2.86       
Dividend payout ratio 43.50  51.03       
           
(1) Calculated as noninterest expense (excluding ORE income/expense) divided by taxable equivalent net interest income plus noninterest income. See Non-GAAP Financial Measures Reconciliation.
(2) All periods presented have been adjusted for the 1 for 5 reverse stock split which occurred on May 28, 2021.
           
TE = Taxable equivalent.
           
           
CONSOLIDATED STATEMENTS OF INCOME
           
(dollars in thousands, except per share data)
(Unaudited)
  Three months ended
  9/30/2021  6/30/2021  3/31/2021  12/31/2020  9/30/2020 
Interest and dividend income:          
Interest and fees on loans$39,488  39,808  40,217  40,906  41,330 
Interest and dividends on securities available for sale:          
U. S. government sponsored enterprises 91  97  50  27  14 
State and political subdivisions 1  -  1  2  1 
Mortgage-backed securities and collateralized mortgage obligations - residential 1,038  1,167  1,237  1,172  1,319 
Corporate bonds 220  323  316  349  646 
Small Business Administration - guaranteed participation securities 181  193  206  212  216 
Other securities 5  5  6  7  5 
Total interest and dividends on securities available for sale 1,536  1,785  1,816  1,769  2,201 
           
Interest on held to maturity securities:          
Mortgage-backed securities and collateralized mortgage obligations - residential 104  111  123  129  138 
Total interest on held to maturity securities 104  111  123  129  138 
           
Federal Reserve Bank and Federal Home Loan Bank stock 64  65  69  70  77 
           
Interest on federal funds sold and other short-term investments 470  286  270  246  242 
Total interest income 41,662  42,055  42,495  43,120  43,988 
           
Interest expense:          
Interest on deposits:          
Interest-bearing checking 38  46  52  51  55 
Savings 154  162  159  156  161 
Money market deposit accounts 202  236  283  447  637 
Time deposits 1,149  1,261  1,666  3,053  4,749 
Interest on short-term borrowings 232  228  228  232  221 
Total interest expense 1,775  1,933  2,388  3,939  5,823 
           
Net interest income 39,887  40,122  40,107  39,181  38,165 
           
Less: (Credit) Provision for loan losses (2,800) -  350  600  1,000 
Net interest income after provision for loan losses 42,687  40,122  39,757  38,581  37,165 
           
Noninterest income:          
Trustco Financial Services income 1,558  1,999  2,035  1,527  1,784 
Fees for services to customers 2,531  2,486  2,204  2,365  2,292 
Other 206  203  189  177  265 
Total noninterest income 4,295  4,688  4,428  4,069  4,341 
           
Noninterest expenses:          
Salaries and employee benefits 11,909  12,403  12,425  11,727  10,899 
Net occupancy expense 4,259  4,328  4,586  4,551  4,277 
Equipment expense 1,628  1,600  1,631  1,621  1,607 
Professional services 1,483  1,614  1,432  1,644  1,311 
Outsourced services 2,015  2,169  2,250  1,925  1,875 
Advertising expense 310  549  354  527  305 
FDIC and other insurance 746  777  707  657  660 
Other real estate (income) expense, net 32  (60) 239  45  (115)
Other 2,315  2,060  1,711  2,133  1,855 
Total noninterest expenses 24,697  25,440  25,335  24,830  22,674 
           
Income before taxes 22,285  19,370  18,850  17,820  18,832 
Income taxes 5,523  4,937  4,767  4,006  4,761 
           
Net income$16,762  14,433  14,083  13,814  14,071 
           
Net income per common share (1):          
- Basic$0.871  0.749  0.730  0.716  0.730 
           
- Diluted 0.871  0.748  0.730  0.716  0.730 
           
Average basic shares (in thousands) (1) 19,249  19,281  19,287  19,287  19,287 
Average diluted shares (in thousands) (1) 19,252  19,290  19,293  19,288  19,288 
           
Note: Taxable equivalent net interest income$39,888  40,122  40,107  39,182  38,166 
           
(1) All periods presented have been adjusted for the 1 for 5 reverse stock split which occurred on May 28, 2021.       
           
           
CONSOLIDATED STATEMENTS OF INCOME, Continued     
      
(dollars in thousands, except per share data)     
(Unaudited)     
  Nine months ended      
  09/30/21  09/30/20       
Interest and dividend income:          
Interest and fees on loans$119,513  125,058       
Interest and dividends on securities available for sale:          
U. S. government sponsored enterprises 238  541       
State and political subdivisions 2  4       
Mortgage-backed securities and collateralized mortgage obligations - residential 3,442  4,959       
Corporate bonds 859  1,372       
Small Business Administration - guaranteed participation securities 580  690       
Other securities 16  16       
Total interest and dividends on securities available for sale 5,137  7,582       
           
Interest on held to maturity securities:          
Mortgage-backed securities-residential 338  475       
Total interest on held to maturity securities 338  475       
           
Federal Reserve Bank and Federal Home Loan Bank stock 198  351       
           
Interest on federal funds sold and other short-term investments 1,026  1,702       
Total interest income 126,212  135,168       
           
Interest expense:          
Interest on deposits:          
Interest-bearing checking 136  97       
Savings 475  560       
Money market deposit accounts 721  2,595       
Time deposits 4,076  16,739       
Interest on short-term borrowings 688  778       
Total interest expense 6,096  20,769       
           
Net interest income 120,116  114,399       
           
Less: (Credit) Provision for loan losses (2,450) 5,000       
Net interest income after provision for loan losses 122,566  109,399       
           
Noninterest income:          
Trustco Financial Services income 5,592  4,752       
Fees for services to customers 7,221  6,414       
Net gain on securities transactions -  1,155       
Other 598  780       
Total noninterest income 13,411  13,101       
           
Noninterest expenses:          
Salaries and employee benefits 36,737  33,920       
Net occupancy expense 13,173  12,968       
Equipment expense 4,859  5,015       
Professional services 4,529  3,974       
Outsourced services 6,434  5,825       
Advertising expense 1,213  1,394       
FDIC and other insurance 2,230  1,563       
Other real estate expense, net 211  47       
Other 6,086  6,168       
Total noninterest expenses 75,472  70,874       
           
Income before taxes 60,505  51,626       
Income taxes 15,227  12,988       
           
Net income$45,278  38,638       
           
Net income per common share (1):          
- Basic$2.349  2.002       
           
- Diluted 2.349  2.001       
           
Average basic shares (in thousands) (1) 19,272  19,306       
Average diluted shares (in thousands) (1) 19,278  19,308       
           
Note: Taxable equivalent net interest income$120,117  114,401       
           
(1) All periods presented have been adjusted for the 1 for 5 reverse stock split which occurred on May 28, 2021.       
           
           
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
 
(dollars in thousands)
(Unaudited)
  9/30/21  6/30/21  3/31/21  12/31/20  9/30/20 
ASSETS:          
           
Cash and due from banks$45,486  47,766  45,493  47,196  47,703 
Federal funds sold and other short term investments 1,147,853  1,134,622  1,094,880  1,059,903  908,616 
Total cash and cash equivalents 1,193,339  1,182,388  1,140,373  1,107,099  956,319 
          
Securities available for sale:         
U. S. government sponsored enterprises 59,749  74,579  74,465  19,968  29,996 
States and political subdivisions 48  48  48  103  111 
Mortgage-backed securities and collateralized mortgage obligations - residential 293,585  315,656  348,317  316,158  309,768 
Small Business Administration - guaranteed participation securities 34,569  37,199  39,232  42,217  44,070 
Corporate bonds 45,915  54,647  64,839  59,939  70,113 
Other securities 686  686  686  686  685 
Total securities available for sale 434,552  482,815  527,587  439,071  454,743 
           
Held to maturity securities:          
Mortgage-backed securities and collateralized mortgage obligations-residential 10,701  11,665  12,729  13,824  15,094 
Total held to maturity securities 10,701  11,665  12,729  13,824  15,094 
           
Federal Reserve Bank and Federal Home Loan Bank stock 5,604  5,604  5,506  5,506  5,506 
          
Loans:         
Commercial 204,679  214,164  217,021  212,492  231,663 
Residential mortgage loans 3,951,285  3,892,351  3,807,837  3,780,167  3,724,746 
Home equity line of credit 231,314  234,214  235,644  242,194  248,320 
Installment loans 9,451  8,638  8,670  9,617  9,826 
Loans, net of deferred net costs 4,396,729  4,349,367  4,269,172  4,244,470  4,214,555 
          
Less: Allowance for loan losses 47,350  50,155  49,991  49,595  49,123 
Net loans 4,349,379  4,299,212  4,219,181  4,194,875  4,165,432 
           
Bank premises and equipment, net 33,233  33,691  34,012  34,412  34,417 
Operating lease right-of-use assets 45,836  45,825  46,614  47,885  47,174 
Other assets 62,191  61,378  60,455  59,124  57,244 
          
Total assets$6,134,835  6,122,578  6,046,457  5,901,796  5,735,929 
          
LIABILITIES:         
Deposits:         
Demand$790,663  765,193  718,343  652,756  635,345 
Interest-bearing checking 1,148,593  1,152,901  1,141,595  1,086,558  1,024,290 
Savings accounts 1,433,130  1,409,556  1,362,141  1,285,501  1,235,259 
Money market deposit accounts 744,051  732,963  719,580  716,005  699,132 
Time deposits 1,124,581  1,169,907  1,231,263  1,296,373  1,305,024 
Total deposits 5,241,018  5,230,520  5,172,922  5,037,193  4,899,050 
          
Short-term borrowings 230,770  237,791  229,950  214,755  193,455 
Operating lease liabilities 50,515  50,586  51,449  52,784  52,125 
Accrued expenses and other liabilities 25,849  25,088  21,105  28,903  30,771 
          
Total liabilities 5,548,152  5,543,985  5,475,426  5,333,635  5,175,401 
          
SHAREHOLDERS' EQUITY:         
Capital stock (1) 20,042  20,041  20,044  20,041  20,041 
Surplus (1) 256,565  256,536  256,674  256,606  256,605 
Undivided profits 339,554  329,350  321,486  313,974  306,741 
Accumulated other comprehensive income, net of tax 7,304  7,840  7,268  11,936  11,537 
Treasury stock at cost (36,782) (35,174) (34,441) (34,396) (34,396)
          
Total shareholders' equity 586,683  578,593  571,031  568,161  560,528 
           
Total liabilities and shareholders' equity$6,134,835  6,122,578  6,046,457  5,901,796  5,735,929 
           
Outstanding shares (in thousands) (1) 19,216  19,265  19,288  19,287  19,287 
           
(1) All periods presented have been adjusted for the 1 for 5 reverse stock split which occurred on May 28, 2021.


NONPERFORMING ASSETS
       
(dollars in thousands)
(Unaudited)
  9/30/2021 6/30/2021 3/31/2021 12/31/2020 9/30/2020 
Nonperforming Assets      
       
New York and other states*      
Loans in nonaccrual status:      
Commercial$176 150 125 452 491 
Real estate mortgage - 1 to 4 family 17,878 18,466 19,826 19,379 19,977 
Installment 32 43 32 43 49 
Total non-accrual loans 18,086 18,659 19,983 19,874 20,517 
Other nonperforming real estate mortgages - 1 to 4 family 19 20 22 23 25 
Total nonperforming loans 18,105 18,679 20,005 19,897 20,542 
Other real estate owned 511 251 420 541 423 
Total nonperforming assets$18,616 18,930 20,425 20,438 20,965 
       
Florida      
Loans in nonaccrual status:      
Commercial$- - - - - 
Real estate mortgage - 1 to 4 family 2,066 2,142 1,626 1,187 1,254 
Installment - - - - - 
Total non-accrual loans 2,066 2,142 1,626 1,187 1,254 
Other nonperforming real estate mortgages - 1 to 4 family - - - - - 
Total nonperforming loans 2,066 2,142 1,626 1,187 1,254 
Other real estate owned - - - - - 
Total nonperforming assets$2,066 2,142 1,626 1,187 1,254 
       
Total      
Loans in nonaccrual status:      
Commercial$176 150 125 452 491 
Real estate mortgage - 1 to 4 family 19,944 20,608 21,452 20,566 21,231 
Installment 32 43 32 43 49 
Total non-accrual loans 20,152 20,801 21,609 21,061 21,771 
Other nonperforming real estate mortgages - 1 to 4 family 19 20 22 23 25 
Total nonperforming loans 20,171 20,821 21,631 21,084 21,796 
Other real estate owned 511 251 420 541 423 
Total nonperforming assets$20,682 21,072 22,051 21,625 22,219 
       
       
Quarterly Net (Recoveries) Chargeoffs      
       
New York and other states*      
Commercial$30 - (32)32 (1)
Real estate mortgage - 1 to 4 family (39)(136)(2)(27)4 
Installment 14 (27)(14)109 18 
Total net chargeoffs (recoveries)$5 (163)(48)114 21 
       
Florida      
Commercial$- - - - - 
Real estate mortgage - 1 to 4 family - (1)- (1)- 
Installment - - 2 15 - 
Total net chargeoffs (recoveries)$- (1)2 14 - 
       
Total      
Commercial$30 - (32)32 (1)
Real estate mortgage - 1 to 4 family (39)(137)(2)(28)4 
Installment 14 (27)(12)124 18 
Total net chargeoffs (recoveries)$5 (164)(46)128 21 
       
       
Asset Quality Ratios      
       
Total nonperforming loans (1)$20,171 20,821 21,631 21,084 21,796 
Total nonperforming assets (1) 20,682 21,072 22,051 21,625 22,219 
Total net chargeoffs (recoveries) (2) 5 (164)(46)128 21 
       
Allowance for loan losses (1) 47,350 50,155 49,991 49,595 49,123 
       
Nonperforming loans to total loans 0.46%0.48%0.51%0.50%0.52%
Nonperforming assets to total assets 0.34%0.34%0.36%0.37%0.39%
Allowance for loan losses to total loans 1.08%1.15%1.17%1.17%1.17%
Coverage ratio (1) 234.7%240.9%231.1%235.2%225.4%
Annualized net chargeoffs (recoveries) to average loans (2) 0.00%-0.02%0.00%0.01%0.00%
Allowance for loan losses to annualized net chargeoffs (recoveries) (2)2367.5xN/A N/A 96.9x584.8x
 
* 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)            
(Unaudited) Three months ended  Three months ended 
  September 30, 2021  September 30, 2020 
  Average InterestAverage  Average InterestAverage 
  Balance  Rate  Balance  Rate 
Assets            
             
Securities available for sale:            
U. S. government sponsored enterprises$68,505  91 0.53%$12,391  14 0.45%
Mortgage backed securities and collateralized mortgage obligations - residential 300,765  1,038 1.38  313,296  1,319 1.68 
State and political subdivisions 48  2 6.66  110  2 7.90 
Corporate bonds 48,543  220 1.81  59,555  646 4.33 
Small Business Administration - guaranteed            
participation securities 34,578  181 2.09  43,282  216 1.99 
Other 686  5 2.92  685  5 2.92 
             
Total securities available for sale 453,125  1,537 1.36  429,319  2,202 2.05 
             
Federal funds sold and other short-term Investments 1,166,679  470 0.16  938,087  242 0.10 
             
Held to maturity securities:            
Mortgage backed securities and collateralized mortgage obligations - residential 11,168  104 3.72  15,759  138 3.52 
             
Total held to maturity securities 11,168  104 3.72  15,759  138 3.52 
             
Federal Reserve Bank and Federal Home Loan Bank stock 5,604  64 4.57  5,506  77 5.59 
             
Commercial loans 210,825  2,649 5.03  231,517  2,625 4.54 
Residential mortgage loans 3,920,903  34,532 3.52  3,702,680  36,020 3.89 
Home equity lines of credit 231,269  2,152 3.69  251,459  2,515 3.98 
Installment loans 8,669  155 7.10  9,632  170 7.02 
             
Loans, net of unearned income 4,371,666  39,488 3.61  4,195,288  41,330 3.94 
             
Total interest earning assets 6,008,242  41,663 2.77  5,583,959  43,989 3.15 
             
Allowance for loan losses (50,160)     (48,483)    
Cash & non-interest earning assets 195,902      201,018     
             
             
Total assets$6,153,984     $5,736,494     
             
             
Liabilities and shareholders' equity            
             
Deposits:            
Interest bearing checking accounts$1,153,812  38 0.01%$1,024,455  55 0.02%
Money market accounts 738,662  202 0.11  682,319  637 0.37 
Savings 1,430,558  154 0.04  1,222,956  161 0.05 
Time deposits 1,152,298  1,149 0.40  1,355,244  4,749 1.39 
             
Total interest bearing deposits 4,475,330  1,543 0.14  4,284,974  5,602 0.52 
Short-term borrowings 240,183  232 0.38  193,765  221 0.45 
             
Total interest bearing liabilities 4,715,513  1,775 0.15  4,478,739  5,823 0.52 
             
Demand deposits 780,163      622,313     
Other liabilities 75,116      78,093     
Shareholders' equity 583,192      557,349     
             
Total liabilities and shareholders' equity$6,153,984     $5,736,494     
             
Net interest income, tax equivalent   39,888      38,166   
             
Net interest spread    2.62%    2.63%
             
             
Net interest margin (net interest income to total interest earning assets)    2.65%    2.73%
             
Tax equivalent adjustment   (1)     (1)  
             
             
 Net interest income   39,887      38,165   
             
             
DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY -
INTEREST RATES AND INTEREST DIFFERENTIAL, Continued
             
(dollars in thousands)            
(Unaudited) Nine months ended  Nine months ended 
  September 30, 2021  September 30, 2020 
  Average InterestAverage  Average InterestAverage 
  Balance  Rate  Balance  Rate 
Assets            
             
Securities available for sale:            
U. S. government sponsored enterprises$65,103  238 0.49%$42,573  541 1.69%
Mortgage backed securities and collateralized mortgage obligations - residential 318,472  3,442 1.44  339,300  4,959 1.95 
State and political subdivisions 49  3 8.16  111  6 7.79 
Corporate bonds 56,245  859 2.04  46,508  1,372 3.93 
Small Business Administration - guaranteed            
participation securities 36,981  580 2.09  45,313  690 2.03 
Other 686  16 3.11  685  16 3.11 
             
Total securities available for sale 477,536  5,138 1.43  474,490  7,584 2.13 
             
Federal funds sold and other short-term Investments 1,108,018  1,026 0.12  693,286  1,702 0.33 
             
Held to maturity securities:            
Mortgage backed securities and collateralized mortgage obligations - residential 12,199  338 3.70  17,029  475 3.72 
             
Total held to maturity securities 12,199  338 3.70  17,029  475 3.72 
             
Federal Reserve Bank and Federal Home Loan Bank stock 5,570  198 4.74  7,998  351 5.85 
             
Commercial loans 212,832  8,203 5.14  217,573  7,778 4.77 
Residential mortgage loans 3,852,960  104,219 3.61  3,652,766  108,845 3.97 
Home equity lines of credit 234,682  6,622 3.77  258,956  7,898 4.07 
Installment loans 8,608  469 7.28  10,129  537 7.08 
             
Loans, net of unearned income 4,309,082  119,513 3.70  4,139,424  125,058 4.03 
             
Total interest earning assets 5,912,405  126,213 2.85  5,332,227  135,170 3.38 
             
Allowance for loan losses (50,101)     (46,618)    
Cash & non-interest earning assets 196,876      196,835     
             
             
Total assets$6,059,180     $5,482,444     
             
             
Liabilities and shareholders' equity            
             
Deposits:            
Interest bearing checking accounts$1,129,480  136 0.02%$949,909  97 0.01%
Money market accounts 731,171  721 0.13  646,170  2,595 0.54 
Savings 1,376,494  475 0.05  1,169,316  560 0.06 
Time deposits 1,203,708  4,076 0.45  1,372,369  16,739 1.63 
             
Total interest bearing deposits 4,440,853  5,408 0.16  4,137,764  19,991 0.65 
Short-term borrowings 232,532  688 0.40  173,497  778 0.60 
             
Total interest bearing liabilities 4,673,385  6,096 0.17  4,311,261  20,769 0.64 
             
Demand deposits 735,495      543,279     
Other liabilities 73,689      77,568     
Shareholders' equity 576,611      550,336     
             
Total liabilities and shareholders' equity$6,059,180     $5,482,444     
             
Net interest income, tax equivalent   120,117      114,401   
             
Net interest spread    2.67%    2.74%
             
             
Net interest margin (net interest income to total interest earning assets)    2.71%    2.86%
             
Tax equivalent adjustment   (1)     (2)  
             
             
Net interest income   120,116      114,399   
             

Non-GAAP Financial Measures Reconciliation

Tangible equity as a percentage of tangible assets at period end is a non-GAAP financial measure derived from GAAP-based amounts. We calculate tangible equity and tangible assets by excluding the balance of intangible assets from shareholders’ equity and total assets, respectively. We calculate tangible equity as a percentage of tangible assets at period end by dividing tangible equity by tangible assets at period end. We believe that this is consistent with the treatment by bank regulatory agencies, which exclude intangible assets from the calculation of risk-based capital ratios.

The efficiency ratio is a non-GAAP measure of expense control relative to revenue from net interest income and fee income. We calculate the efficiency ratio by dividing total noninterest expenses as determined under GAAP, but excluding other real estate expense, net, by net interest income (fully taxable equivalent) and total noninterest income as determined under GAAP, but excluding net gains on the sale of securities and other non-routine items from this calculation. We believe that this provides a reasonable measure of primary banking expenses relative to primary banking revenue.

We believe that these non-GAAP financial measures provide information that is important to investors and that is useful in understanding our financial results. Our management internally assesses our performance based, in part, on these measures. However, these non-GAAP financial measures are supplemental and not a substitute for an analysis based on GAAP measures. As other companies may use different calculations for these measures, this presentation may not be comparable to other similarly titled measures reported by other companies. A reconciliation of the non-GAAP measures of tangible common equity, tangible book value per share, efficiency ratio, net income and net income per share to the underlying GAAP numbers is set forth below.

NON-GAAP FINANCIAL MEASURES RECONCILIATION
 
(dollars in thousands, except per share amounts)
(Unaudited)
  9/30/2021 6/30/2021 9/30/2020     
         
Tangible Equity to Tangible Assets        
Total Assets (GAAP)$6,134,835 6,122,578 5,735,929     
Less: Intangible assets 553 553 553     
Tangible assets (Non-GAAP) 6,134,282 6,122,025 5,735,376     
         
Equity (GAAP) 586,683 578,593 560,528     
Less: Intangible assets 553 553 553     
Tangible equity (Non-GAAP) 586,130 578,040 559,975     
Tangible Equity to Tangible Assets (Non-GAAP) 9.55%9.44%9.76%    
Equity to Assets (GAAP) 9.56%9.45%9.77%    
         
  Three months ended  Nine months ended
Efficiency Ratio 9/30/2021 6/30/2021 9/30/2020   9/30/2021 9/30/2020 
         
Net interest income (fully taxable equivalent) (Non-GAAP)$39,888 40,122 38,166  $120,117 114,401 
Non-interest income (GAAP) 4,295 4,688 4,341   13,411 13,101 
Less: Net gain on securities - - -   - 1,155 
Revenue used for efficiency ratio (Non-GAAP) 44,183 44,810 42,507   133,528 126,347 
         
Total noninterest expense (GAAP) 24,697 25,440 22,674   75,472 70,874 
Less: Other real estate expense (income), net 32 (60)(115)  211 47 
Expense used for efficiency ratio (Non-GAAP) 24,665 25,500 22,789   75,261 70,827 
         
Efficiency Ratio 55.82%56.91%53.61%  56.36%56.06%


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