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NBT Bancorp Inc. Announces Third Quarter Net Income of $37.4 Million ($0.86 per Diluted Common Share); Approves Dividend

10/26/21

NORWICH, N.Y., Oct. 26, 2021 (GLOBE NEWSWIRE) -- NBT Bancorp Inc. (“NBT” or the “Company”) (NASDAQ: NBTB) reported net income and diluted earnings per share for the three and nine months ended September 30, 2021.

Net income for the three months ended September 30, 2021 was $37.4 million, or $0.86 per diluted common share. Net income increased $2.3 million from the third quarter of 2020, primarily due to changes in the estimated impact of the COVID-19 pandemic on expected credit losses. The third quarter 2020 provision for loan losses was $3.3 million compared to the third quarter 2021 provision release of $3.3 million. Net income decreased $2.9 million from the previous quarter primarily due to a lower net benefit from provision for loan losses and slightly higher noninterest expense, partly offset by higher noninterest income.

Pre-provision net revenue (“PPNR”)1 for the third quarter of 2021 was $47.4 million compared to $49.0 million in the previous quarter and $49.6 million in the third quarter of 2020. Income from Paycheck Protection Program (“PPP”) loans decreased $1.9 million and $1.8 million from the previous quarter and the third quarter of 2020, respectively.

CEO Comments

“We continue to experience momentum across the markets we serve. Our team is focused on our customers and successful execution of our key strategies,” said NBT President and CEO John H. Watt, Jr. “Across our New England footprint, we are advancing our growth strategy by leveraging the market disruption occurring in that region. Our balance sheet is strong and it continues to provide us optionality to deploy capital in a strategic manner, and we are actively exploring opportunities.”

Third Quarter Financial Highlights

Net Income
  • Net income of $37.4 million
  • Diluted earnings per share of $0.86
Net Interest Income / NIM
  • Net interest income on a fully taxable equivalent basis was $78.0 million1
  • Net interest margin (“NIM”) on a fully taxable equivalent basis was 2.88%1, down 12 basis points (“bps”) from the prior quarter
  • Total cost of deposits of 0.10%
PPNR
  • PPNR1 was $47.4 million compared to $49.0 million in the second quarter of 2021 and $49.6 million in the third quarter of 2020
Loans and Credit Quality
  • Period end total loans were $7.6 billion, up 1%, annualized, from December 31, 2020
  • Excluding $276 million and $431 million of PPP loans at September 30, 2021 and December 31, 2020, respectively, period end loans increased $222 million or 3% from December 31, 2020
  • Allowance for loan losses to total loans of 1.23% (1.28% excluding PPP loans and related allowance), down 8 bps from the second quarter 2021 (down 10 bps excluding PPP loans and related allowance)
  • Net charge-offs to average loans was 0.11%, annualized (0.12% excluding PPP loans)
  • Nonperforming loans to total loans was 0.51% (0.53% excluding PPP loans), down from 0.57% in the prior quarter
Capital
  • Tangible book value per share2 grew 2% for the quarter and 10% from prior year to $21.95 at September 30, 2021
  • Tangible equity to assets of 8.13%1
  • CET1 ratio of 12.20%; Leverage ratio of 9.47%

Loans

  • Period end total loans were $7.6 billion at September 30, 2021 and $7.5 billion at December 31, 2020.
  • Excluding PPP loans, period end loans increased $222 million from December 31, 2020. Commercial and industrial loans increased $15.0 million to $1.5 billion; commercial real estate loans increased $123.9 million to $2.3 billion; and total consumer loans increased $83.3 million to $3.5 billion.
  • Total PPP loans as of September 30, 2021 were $276 million (net of unamortized fees). The following activity occurred during the third quarter of 2021:
    • $84.7 million of loans forgiven
    • $2.9 million of interest and fees recognized into interest income compared to $4.7 million for the second quarter of 2021
  • Commercial line of credit utilization rate was 21% at September 30, 2021 compared to 22% at June 30, 2021 and compared to 25% at September 30, 2020.

Deposits

  • Average total deposits in the third quarter of 2021 were $10.0 billion, compared to $9.9 billion in the second quarter of 2021, driven by increases in non-interest bearing demand deposit accounts and savings deposit accounts, partly offset by the decrease in money market deposit accounts and time deposits accounts.
  • Loan to deposit ratio was 74.2% at September 30, 2021, compared to 82.6% at December 31, 2020.

Net Interest Income and Net Interest Margin

  • Net interest income for the third quarter of 2021 was $77.7 million, which was down $1.5 million or 1.9% from the second quarter of 2021 and down $0.3 million or 0.3% from the third quarter of 2020.
  • The NIM on a fully taxable equivalent (“FTE”) basis for the third quarter of 2021 was 2.88%, down 12 bps from the second quarter of 2021 and down 29 bps from the third quarter of 2020. The net impact of income from PPP loans and excess liquidity negatively impacted the NIM by 26 bps in the third quarter of 2021 compared to a negative 24 bps impact in the second quarter 2021. Excluding the impact of PPP lending and excess liquidity from each quarter, the NIM decreased 10 bps from the prior quarter primarily due to an 11 bp decline in earning asset yields partially offset by a 1 bp decline in the cost of interest bearing liabilities.
  • Earning asset yields for the three months ended September 30, 2021 were down 13 bps from the prior quarter and down 40 bps from the same quarter in the prior year. Earning assets grew $96.4 million or 0.9% from the prior quarter and grew $901.2 million or 9.2% from the same quarter in the prior year. The following are highlights comparing the third quarter 2021 to the prior quarter:
    • Excess liquidity resulted in a $40.0 million increase in the average balances of short-term interest bearing accounts with a yield of 0.16%.
    • The average balance of investment securities increased $112.8 million while yields declined 11 bps.
    • Loan yields decreased 12 bps to 3.84% for the quarter. Excluding PPP loans, yields decreased 10 bps from the prior quarter.
  • Total cost of deposits was 0.10% for the third quarter of 2021, down 2 bps from the prior quarter and down 9 bps from the same period in the prior year.
  • The cost of interest-bearing liabilities for the three months ended September 30, 2021 was 0.27%, down 2 bps compared to the prior quarter of 0.29% and down 18 bps from the third quarter of 2020 of 0.45%.

Credit Quality and Allowance for Credit Losses

  • Net charge-offs to total average loans of 11 bps (12 bps excluding PPP loans) compared to 7 bps (7 bps excluding PPP loans) in the prior quarter and 12 bps (13 bps excluding PPP loans) in the third quarter of 2020. 36% of the quarter’s net charge-offs were reserved for previously.
  • Nonperforming assets to total assets was 0.33% (0.34% excluding PPP loans) compared to 0.38% (0.39% excluding PPP loans) at June 30, 2021 and 0.37% (0.39% excluding PPP loans) at September 30, 2020.
  • Provision expense for the three months ended September 30, 2021 was a net benefit of $3.3 million with net charge-offs of $2.2 million. The net provision benefit was $1.9 million less than the second quarter of 2021 compared to provision expense of $3.3 million in the third quarter of 2020. The increase in net provision benefit from the third quarter of 2020 was primarily due to the impacts of an improved economic forecast on the required level of allowance for loan losses.
  • The allowance for loan losses was $93.0 million or 1.23% (1.28% excluding PPP loans and related allowance) of total loans compared to 1.31% (1.38% excluding PPP loans and related allowance) at June 30, 2021 and 1.51% (1.62% excluding PPP loans and related allowance) at September 30, 2020. The decrease in the level of allowance for credit losses was primarily due to the positive impact the forecasted improving economic conditions had on expected credit losses.
  • The reserve for unfunded loan commitments decreased to $5.3 million at September 30, 2021 compared to the prior quarter at $5.8 million.

Noninterest Income

  • Total noninterest income, excluding securities gains (losses), was $40.4 million for the three months ended September 30, 2021, up $1.3 million from the prior quarter and up $2.8 million from the prior year quarter.
  • Service charges on deposit accounts were higher than the prior quarter and the third quarter of 2020, but still significantly below pre-pandemic levels.
  • ATM and debit card fees were comparable to the prior quarter and higher than the third quarter of 2020 due to increased volume and higher per transaction rates.
  • Retirement plan administration fees were higher than the prior quarter and higher than the third quarter of 2020 driven by market performance and organic growth in relationships.
  • Wealth management fees were higher than both the prior quarter and third quarter of 2020 driven by market performance and additional new customers.
  • Other noninterest income decreased from the prior quarter due to lower swap fee income and decreased from the third quarter of 2020 driven by lower mortgage banking income.

Noninterest Expense

  • Total noninterest expense for the third quarter of 2021 was up 2.0% from the previous quarter and up 9.9% from the third quarter of 2020.
  • Salaries and benefits increased from the prior quarter and the third quarter of 2020 due to one additional day of payroll in the third quarter, increased medical expenses and higher incentive compensation accruals.
  • Data processing and communications decreased from the prior quarter driven by lower expenses related to processing of PPP loans and was comparable to the third quarter of 2020.
  • Equipment expense was comparable to the prior quarter and higher than the third quarter of 2020 due to higher technology costs associated with several digital upgrades.
  • Other expenses increased from the prior quarter and the third quarter of 2020 and included $2.3 million in non-recurring costs, primarily from estimated litigation settlement costs related to a pending lawsuit regarding certain of the Company’s deposit products and related disclosures. The Company does not anticipate further material accruals related to this legal matter.

Income Taxes

  • The effective tax rate was 22.8% for the third quarter of 2021 compared to 22.9% for the second quarter of 2021 and 23.8% for the third quarter of 2020. The lower effective tax rate compared to the third quarter of 2020 was due to the change in the level of taxable income to bring the nine months ended September 30, 2020 estimated effective tax rate to 21.75%.

Capital

  • Capital ratios remain strong with tangible common equity to tangible assets1 at 8.13%. Tangible book value per share2 grew 2% from the prior quarter and 10% from the prior year quarter to $21.95.
  • September 30, 2021 CET1 capital ratio of 12.20%, leverage ratio of 9.47% and total risk-based capital ratio of 15.74%.

Dividend and Stock Repurchase

  • The Board of Directors approved a fourth-quarter cash dividend of $0.28 per share at a meeting held yesterday, an increase of 3.7% from the amount paid in the fourth quarter of 2020. The dividend will be paid on December 15, 2021 to shareholders of record as of December 1, 2021.
  • The Company purchased 119,342 shares of common stock during the third quarter of 2021 at a weighted average price of $35.30 excluding commissions. As of September 30, 2021, there were 1,600,000 shares available for repurchase under this plan, which expires on December 31, 2021.

Conference Call and Webcast

The Company will host a conference call at 8:30 a.m. (Eastern) Wednesday, October 27, 2021, to review third quarter 2021 financial results. The audio webcast link, along with the corresponding presentation slides, will be available on the Company’s Event Calendar page at https://stockholderinfo.nbtbancorp.com/events-calendar/upcoming-events and will be archived for twelve months.

Corporate Overview

NBT Bancorp Inc. is a financial holding company headquartered in Norwich, NY, with total assets of $12.0 billion at September 30, 2021. The Company primarily operates through NBT Bank, N.A., a full-service community bank, and through two financial services companies. NBT Bank, N.A. has 140 banking locations in New York, Pennsylvania, Vermont, Massachusetts, New Hampshire, Maine and Connecticut. EPIC Retirement Plan Services, based in Rochester, NY, is a full-service retirement plan administration and recordkeeping firm. NBT Insurance Agency, LLC, based in Norwich, NY, is a full-service insurance agency. More information about NBT and its divisions is available online at: www.nbtbancorp.com, www.nbtbank.com, www.epicrps.com and www.nbtinsurance.com.

Forward-Looking Statements

This news release contains forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. These statements may be identified by the use of phrases such as “anticipate,” “believe,” “expect,” “forecasts,” “projects,” “will,” “can,” “would,” “should,” “could,” “may,” or other similar terms. There are a number of factors, many of which are beyond the Company’s control that could cause actual results to differ materially from those contemplated by 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) local, regional, national and international economic conditions and the impact they may have on the Company and its customers and the Company’s assessment of that impact; (2) changes in the level of nonperforming assets and charge-offs; (3) changes in estimates of future reserve requirements based upon the periodic review thereof under relevant regulatory and accounting requirements; (4) the effects of and changes in trade and monetary and fiscal policies and laws, including the interest rate policies of the Federal Reserve Board (“FRB”); (5) inflation, interest rate, securities market and monetary fluctuations; (6) political instability; (7) acts of war or terrorism; (8) the timely development and acceptance of new products and services and perceived overall value of these products and services by users; (9) changes in consumer spending, borrowings and savings habits; (10) changes in the financial performance and/or condition of the Company’s borrowers; (11) technological changes; (12) acquisitions and integration of acquired businesses; (13) the ability to increase market share and control expenses; (14) changes in the competitive environment among financial holding companies; (15) the effect of changes in laws and regulations (including laws and regulations concerning taxes, banking, securities and insurance) with which the Company and its subsidiaries must comply, including those under the Dodd-Frank Act, Economic Growth, Regulatory Relief, Consumer Protection Act of 2018, Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), and other legislative and regulatory responses to the coronavirus (“COVID-19”) pandemic; (16) the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board (“FASB”) and other accounting standard setters; (17) changes in the Company’s organization, compensation and benefit plans; (18) the costs and effects of legal and regulatory developments including the resolution of legal proceedings or regulatory or other governmental inquiries and the results of regulatory examinations or reviews; (19) greater than expected costs or difficulties related to the integration of new products and lines of business; (20) the adverse impact on the U.S. economy, including the markets in which we operate, of the novel coronavirus, which causes COVID-19 global pandemic; and (21) the Company’s success at managing the risks involved in the foregoing items.

Currently, one of the most significant factors that could cause actual outcomes to differ materially from the Company’s forward-looking statements is the potential adverse effect of the current COVID-19 pandemic on the financial condition, results of operations, cash flows and performance of the Company, its customers and the global economy and financial markets. The extent to which the COVID-19 pandemic impacts the Company will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the speed and effectiveness of vaccine and treatment developments and deployment, and its impact on the Company’s customers and demand for financial services, the actions governments, businesses and individuals take in response to the pandemic, the impact of the COVID-19 pandemic and actions taken in response to the pandemic on global and regional economies, national and local economic activity, and the pace of recovery when the COVID-19 pandemic subsides, among others. Moreover, investors are cautioned to interpret many of the risks identified under the section entitled “Risk Factors” in our Form 10-K for the year ended December 31, 2020 as being heightened as a result of the ongoing and numerous adverse impacts of the COVID-19 pandemic. The Company cautions readers not place undue reliance on any forward-looking statements, which speak only as of the date made, and advises readers that various factors including, but not limited to, those described above and other factors discussed in the Company’s annual and quarterly reports previously filed with the SEC, could affect the Company’s financial performance and could cause the Company’s actual results or circumstances for future periods to differ materially from those anticipated or projected. Unless required by law, the Company does not undertake, and specifically disclaims any obligations to, publicly release any revisions that may be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.

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”). 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 provide useful information that is important to an understanding of the results of the Company’s core business as well as provide information standard in the financial institution industry. 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. Amounts previously reported in the consolidated financial statements are reclassified whenever necessary to conform to current period presentation.

 


 
NBT Bancorp Inc. and Subsidiaries
Selected Financial Data
(unaudited, dollars in thousands except per share data)
           
  2021 2020
  3rd Q 2nd Q 1st Q 4th Q 3rd Q
Profitability:          
Diluted earnings per share $ 0.86   $ 0.92   $ 0.91   $ 0.78   $ 0.80  
Weighted average diluted common shares outstanding   43,631,497     43,792,940     43,889,889     43,973,971     43,941,953  
Return on average assets3   1.26 %   1.39 %   1.46 %   1.24 %   1.29 %
Return on average equity3   12.04 %   13.42 %   13.57 %   11.59 %   12.09 %
Return on average tangible common equity1 3   15.97 %   17.93 %   18.24 %   15.71 %   16.51 %
Net interest margin1 3   2.88 %   3.00 %   3.17 %   3.20 %   3.17 %
           
  9 Months Ended
September 30,
     
    2021     2020        
Profitability:          
Diluted earnings per share $ 2.69   $ 1.60        
Weighted average diluted common shares outstanding   43,768,647     43,996,637        
Return on average assets3   1.37 %   0.90 %      
Return on average equity3   13.00 %   8.23 %      
Return on average tangible common equity1 3   17.35 %   11.36 %      
Net interest margin1 3   3.01 %   3.35 %      
           
  2021 2020
  3rd Q 2nd Q 1st Q 4th Q 3rd Q
Balance sheet data:          
Short-term interest bearing accounts $ 1,131,074   $ 883,758   $ 972,195   $ 512,686   $ 450,291  
Securities available for sale   1,576,030     1,534,733     1,387,028     1,348,698     1,197,925  
Securities held to maturity   683,103     622,351     592,999     616,560     663,088  
Net loans   7,473,442     7,419,127     7,528,459     7,388,885     7,446,143  
Total assets   11,994,411     11,574,947     11,537,253     10,932,906     10,850,212  
Total deposits   10,195,178     9,785,257     9,815,930     9,081,692     8,958,183  
Total borrowings   313,311     304,110     308,766     406,731     446,737  
Total liabilities   10,752,954     10,349,891     10,346,272     9,745,288     9,684,101  
Stockholders' equity   1,241,457     1,225,056     1,190,981     1,187,618     1,166,111  
           
Capital:          
Equity to assets   10.35 %   10.58 %   10.32 %   10.86 %   10.75 %
Tangible equity ratio1   8.13 %   8.28 %   8.00 %   8.41 %   8.27 %
Book value per share $ 28.65   $ 28.19   $ 27.43   $ 27.22   $ 26.74  
Tangible book value per share2 $ 21.95   $ 21.50   $ 20.71   $ 20.52   $ 20.02  
Leverage ratio   9.47 %   9.40 %   9.60 %   9.56 %   9.48 %
Common equity tier 1 capital ratio   12.20 %   12.12 %   12.13 %   11.84 %   11.63 %
Tier 1 capital ratio   13.39 %   13.34 %   13.38 %   13.09 %   12.88 %
Total risk-based capital ratio   15.74 %   15.78 %   15.92 %   15.62 %   15.43 %
Common stock price (end of period) $ 36.12   $ 35.97   $ 39.90   $ 32.10   $ 26.82  
 


NBT Bancorp Inc. and Subsidiaries
Asset Quality and Consolidated Loan Balances
(unaudited, dollars in thousands)
           
    2021     2020  
  3rd Q 2nd Q 1st Q 4th Q 3rd Q
Asset quality:          
Nonaccrual loans $ 35,737   $ 40,550   $ 43,399   $ 44,647   $ 35,896  
90 days past due and still accruing   2,940     2,575     2,155     3,149     2,579  
Total nonperforming loans   38,677     43,125     45,554     47,796     38,475  
Other real estate owned   859     798     1,318     1,458     1,605  
Total nonperforming assets   39,536     43,923     46,872     49,254     40,080  
Allowance for loan losses   93,000     98,500     105,000     110,000     114,500  
           
Asset quality ratios (total):          
Allowance for loan losses to total loans   1.23 %   1.31 %   1.38 %   1.47 %   1.51 %
Total nonperforming loans to total loans   0.51 %   0.57 %   0.60 %   0.64 %   0.51 %
Total nonperforming assets to total assets   0.33 %   0.38 %   0.41 %   0.45 %   0.37 %
Allowance for loan losses to total nonperforming loans   240.45 %   228.41 %   230.50 %   230.14 %   297.60 %
Past due loans to total loans4   0.46 %   0.26 %   0.22 %   0.37 %   0.26 %
Net charge-offs to average loans3   0.11 %   0.07 %   0.12 %   0.21 %   0.12 %
           
Asset quality ratios (excluding paycheck protection program):        
Allowance for loan losses to total loans   1.28 %   1.38 %   1.48 %   1.56 %   1.62 %
Total nonperforming loans to total loans   0.53 %   0.60 %   0.64 %   0.68 %   0.55 %
Total nonperforming assets to total assets   0.34 %   0.39 %   0.43 %   0.47 %   0.39 %
Allowance for loan losses to total nonperforming loans   240.42 %   228.36 %   230.44 %   230.10 %   297.53 %
Past due loans to total loans4   0.48 %   0.27 %   0.23 %   0.39 %   0.28 %
Net charge-offs to average loans3   0.12 %   0.07 %   0.13 %   0.22 %   0.13 %
           
    2021     2020  
  3rd Q 2nd Q 1st Q 4th Q 3rd Q
Allowance for loan losses as a percentage of loans by segment:        
Commercial & industrial   0.83%     1.11%     1.20%     1.34%     1.34%  
Commercial real estate   0.93%     1.26%     1.48%     1.49%     1.57%  
Paycheck protection program   0.01%     0.01%     0.01%     0.01%     0.01%  
Residential real estate   0.93%     0.98%     1.03%     1.07%     1.21%  
Auto   0.78%     0.76%     0.78%     0.93%     0.92%  
Other consumer   4.57%     4.27%     4.34%     4.55%     4.66%  
Total   1.23%     1.31%     1.38%     1.47%     1.51%  
Total excluding PPP loans   1.28%     1.38%     1.48%     1.56%     1.62%  
           
    2021     2020  
Loans by line of business: 3rd Q 2nd Q 1st Q 4th Q 3rd Q
Commercial $ 1,466,597   $ 1,479,258   $ 1,466,841   $ 1,451,560   $ 1,458,053  
Commercial real estate   2,320,341     2,265,754     2,242,289     2,196,477     2,121,198  
Paycheck protection program   276,195     359,738     536,494     430,810     514,558  
Residential real estate mortgages   1,549,684     1,512,354     1,478,216     1,466,662     1,448,530  
Indirect auto   873,860     899,324     913,083     931,286     989,369  
Specialty lending   692,919     602,585     577,509     579,644     566,973  
Home equity   339,316     351,469     369,633     387,974     404,346  
Other consumer   47,530     47,145     49,394     54,472     57,616  
Total loans $ 7,566,442   $ 7,517,627   $ 7,633,459   $ 7,498,885   $ 7,560,643  
           
PPP unamortized fees (dollars in millions) $ 10.5   $ 12.6   $ 14.2   $ 6.9   $ 11.3  
           


NBT Bancorp Inc. and Subsidiaries
Consolidated Balance Sheets
(unaudited, dollars in thousands)
     
  September 30, December 31,
Assets 2021 2020
Cash and due from banks $ 215,032   $ 159,995  
Short-term interest bearing accounts   1,131,074     512,686  
Equity securities, at fair value   33,013     30,737  
Securities available for sale, at fair value   1,576,030     1,348,698  
Securities held to maturity (fair value $689,129 and $636,827, respectively)   683,103     616,560  
Federal Reserve and Federal Home Loan Bank stock   25,161     27,353  
Loans held for sale   1,024     1,119  
Loans   7,566,442     7,498,885  
Less allowance for loan losses   93,000     110,000  
Net loans $ 7,473,442   $ 7,388,885  
Premises and equipment, net   71,928     74,206  
Goodwill   280,541     280,541  
Intangible assets, net   9,578     11,735  
Bank owned life insurance   227,451     186,434  
Other assets   267,034     293,957  
Total assets $ 11,994,411   $ 10,932,906  
     
Liabilities and stockholders' equity    
Demand (noninterest bearing) $ 3,748,162   $ 3,241,123  
Savings, NOW and money market   5,894,743     5,207,090  
Time   552,273     633,479  
Total deposits $ 10,195,178   $ 9,081,692  
Short-term borrowings   99,715     168,386  
Long-term debt   14,020     39,097  
Subordinated debt, net   98,380     98,052  
Junior subordinated debt   101,196     101,196  
Other liabilities   244,465     256,865  
Total liabilities $ 10,752,954   $ 9,745,288  
     
Total stockholders' equity $ 1,241,457   $ 1,187,618  
     
Total liabilities and stockholders' equity $ 11,994,411   $ 10,932,906  
     


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,
  2021 2020 2021 2020
Interest, fee and dividend income        
Interest and fees on loans $ 72,817   $ 74,998   $ 222,705   $ 230,996  
Securities available for sale   5,898     5,603     17,204     16,956  
Securities held to maturity   2,976     3,734     9,454     11,751  
Other   524     659     1,206     2,138  
Total interest, fee and dividend income $ 82,215   $ 84,994   $ 250,569   $ 261,841  
Interest expense        
Deposits $ 2,548   $ 4,267   $ 8,582   $ 18,183  
Short-term borrowings   28     446     130     3,215  
Long-term debt   89     398     301     1,184  
Subordinated debt   1,359     1,375     4,077     1,503  
Junior subordinated debt   517     565     1,572     2,186  
Total interest expense $ 4,541   $ 7,051   $ 14,662   $ 26,271  
Net interest income $ 77,674   $ 77,943   $ 235,907   $ 235,570  
Provision for loan losses   (3,342 )   3,261     (11,354 )   51,741  
Net interest income after provision for loan losses $ 81,016   $ 74,682   $ 247,261   $ 183,829  
Noninterest income        
Service charges on deposit accounts $ 3,489   $ 3,087   $ 9,544   $ 9,613  
ATM and debit card fees   8,172     7,194     23,343     19,184  
Retirement plan administration fees   10,495     9,685     30,372     26,840  
Wealth management fees   8,783     7,695     25,099     21,791  
Insurance services   3,720     3,742     10,689     11,303  
Bank owned life insurance income   1,548     1,255     4,588     4,010  
Net securities (losses) gains   (100 )   84     568     (548 )
Other   4,222     4,985     12,480     15,968  
Total noninterest income $ 40,329   $ 37,727   $ 116,683   $ 108,161  
Noninterest expense        
Salaries and employee benefits $ 44,190   $ 40,451   $ 128,462   $ 120,918  
Occupancy   5,117     5,294     16,281     16,354  
Data processing and communications   3,881     4,058     13,039     12,370  
Professional fees and outside services   3,784     3,394     11,403     10,694  
Equipment   5,577     5,073     16,247     14,494  
Office supplies and postage   1,364     1,530     4,478     4,621  
FDIC expense   772     645     2,243     1,949  
Advertising   583     530     1,502     1,461  
Amortization of intangible assets   663     856     2,157     2,573  
Loan collection and other real estate owned, net   706     620     1,959     2,365  
Other   6,232     3,857     14,405     14,730  
Total noninterest expense $ 72,869   $ 66,308   $ 212,176   $ 202,529  
Income before income tax expense $ 48,476   $ 46,101   $ 151,768   $ 89,461  
Income tax expense   11,043     10,988     34,193     19,267  
Net income $ 37,433   $ 35,113   $ 117,575   $ 70,194  
Earnings Per Share        
Basic $ 0.86   $ 0.80   $ 2.71   $ 1.61  
Diluted $ 0.86   $ 0.80   $ 2.69   $ 1.60  
         


NBT Bancorp Inc. and Subsidiaries
Quarterly Consolidated Statements of Income
(unaudited, dollars in thousands except per share data)
           
  2021 2020
  3rd Q 2nd Q 1st Q 4th Q 3rd Q
Interest, fee and dividend income          
Interest and fees on loans $ 72,817   $ 74,795   $ 75,093   $ 76,863   $ 74,998  
Securities available for sale   5,898     5,762     5,544     5,478     5,603  
Securities held to maturity   2,976     3,096     3,382     3,532     3,734  
Other   524     391     291     568     659  
Total interest, fee and dividend income $ 82,215   $ 84,044   $ 84,310   $ 86,441   $ 84,994  
Interest expense          
Deposits $ 2,548   $ 2,862   $ 3,172   $ 3,887   $ 4,267  
Short-term borrowings   28     32     70     193     446  
Long-term debt   89     88     124     369     398  
Subordinated debt   1,359     1,359     1,359     1,339     1,375  
Junior subordinated debt   517     525     530     545     565  
Total interest expense $ 4,541   $ 4,866   $ 5,255   $ 6,333   $ 7,051  
Net interest income $ 77,674   $ 79,178   $ 79,055   $ 80,108   $ 77,943  
Provision for loan losses   (3,342 )   (5,216 )   (2,796 )   (607 )   3,261  
Net interest income after provision for loan losses $ 81,016   $ 84,394   $ 81,851   $ 80,715   $ 74,682  
Noninterest income          
Service charges on deposit accounts $ 3,489   $ 3,028   $ 3,027   $ 3,588   $ 3,087  
ATM and debit card fees   8,172     8,309     6,862     6,776     7,194  
Retirement plan administration fees   10,495     9,779     10,098     9,011     9,685  
Wealth management fees   8,783     8,406     7,910     7,456     7,695  
Insurance services   3,720     3,508     3,461     3,454     3,742  
Bank owned life insurance income   1,548     1,659     1,381     1,733     1,255  
Net securities (losses) gains   (100 )   201     467     160     84  
Other   4,222     4,426     3,832     5,937     4,985  
Total noninterest income $ 40,329   $ 39,316   $ 37,038   $ 38,115   $ 37,727  
Noninterest expense          
Salaries and employee benefits $ 44,190   $ 42,671   $ 41,601   $ 41,016   $ 40,451  
Occupancy   5,117     5,291     5,873     5,280     5,294  
Data processing and communications   3,881     4,427     4,731     4,157     4,058  
Professional fees and outside services   3,784     4,030     3,589     4,388     3,394  
Equipment   5,577     5,493     5,177     5,395     5,073  
Office supplies and postage   1,364     1,615     1,499     1,517     1,530  
FDIC expense   772     663     808     739     645  
Advertising   583     468     451     827     530  
Amortization of intangible assets   663     682     812     822     856  
Loan collection and other real estate owned, net   706     663     590     930     620  
Other   6,232     5,416     2,757     10,133     3,857  
Total noninterest expense $ 72,869   $ 71,419   $ 67,888   $ 75,204   $ 66,308  
Income before income tax expense $ 48,476   $ 52,291   $ 51,001   $ 43,626   $ 46,101  
Income tax expense   11,043     11,995     11,155     9,432     10,988  
Net income $ 37,433   $ 40,296   $ 39,846   $ 34,194   $ 35,113  
Earnings Per Share          
Basic $ 0.86   $ 0.93   $ 0.91   $ 0.78   $ 0.80  
Diluted $ 0.86   $ 0.92   $ 0.91   $ 0.78   $ 0.80  
           


NBT Bancorp Inc. and Subsidiaries
Average Quarterly Balance Sheets
(unaudited, dollars in thousands)
                       
    Average
Balance
Yield /
Rates
Average
Balance
Yield /
Rates
Average
Balance
Yield /
Rates
Average
Balance
Yield /
Rates
Average
Balance
Yield /
Rates
    Q3 - 2021 Q2 - 2021 Q1 - 2021 Q4 - 2020 Q3 - 2020
Assets                      
Short-term interest bearing accounts $ 1,014,120   0.16 % $ 974,034   0.09 % $ 587,358   0.09 % $ 552,529   0.11 % $ 477,946   0.11 %
Securities available for sale1 5     1,513,071   1.55 %   1,453,068   1.59 %   1,346,380   1.67 %   1,230,411   1.77 %   1,137,604   1.96 %
Securities held to maturity1 5     657,314   1.95 %   604,582   2.23 %   607,407   2.43 %   640,422   2.36 %   621,812   2.56 %
Investment in FRB and FHLB Banks   25,154   1.91 %   25,115   2.67 %   25,606   2.45 %   28,275   5.94 %   29,720   7.08 %
Loans1 6     7,517,839   3.84 %   7,574,272   3.96 %   7,574,337   4.02 %   7,533,953   4.06 %   7,559,218   3.95 %
Total interest earning assets   $ 10,727,498   3.05 % $ 10,631,071   3.18 % $ 10,141,088   3.38 % $ 9,985,590   3.46 % $ 9,826,300   3.45 %
Other assets     1,019,797       971,681       960,994       954,123       967,194    
Total assets   $ 11,747,295     $ 11,602,752       $ 11,102,082       $ 10,939,713       $ 10,793,494      
                       
                       
Liabilities and stockholders' equity                  
Money market deposit accounts   $ 2,580,570   0.19 % $ 2,605,767   0.21 % $ 2,484,120   0.23 % $ 2,455,510   0.27 % $ 2,364,606   0.28 %
NOW deposit accounts     1,442,678   0.05 %   1,454,751   0.05 %   1,358,955   0.05 %   1,315,370   0.05 %   1,207,064   0.05 %
Savings deposits     1,691,539   0.05 %   1,660,722   0.05 %   1,547,983   0.05 %   1,465,562   0.05 %   1,447,021   0.05 %
Time deposits     565,216   0.62 %   591,147   0.75 %   615,343   0.93 %   645,288   1.15 %   684,708   1.31 %
Total interest bearing deposits   $ 6,280,003   0.16 % $ 6,312,387   0.18 % $ 6,006,401   0.21 % $ 5,881,730   0.26 % $ 5,703,399   0.30 %
Short-term borrowings     99,703   0.11 %   95,226   0.13 %   115,182   0.25 %   175,597   0.44 %   277,890   0.64 %
Long-term debt     14,029   2.52 %   14,053   2.51 %   19,913   2.53 %   59,488   2.47 %   64,137   2.47 %
Subordinated debt, net     98,311   5.48 %   98,204   5.55 %   98,095   5.62 %   97,984   5.44 %   97,934   5.59 %
Junior subordinated debt     101,196   2.03 %   101,196   2.08 %   101,196   2.12 %   101,196   2.14 %   101,196   2.22 %
Total interest bearing liabilities   $ 6,593,242   0.27 % $ 6,621,066   0.29 % $ 6,340,787   0.34 % $ 6,315,995   0.40 % $ 6,244,556   0.45 %
Demand deposits     3,676,883       3,542,176       3,319,024       3,178,410       3,111,617    
Other liabilities     244,125       235,536       250,991       271,206       282,265    
Stockholders' equity     1,233,045       1,203,974       1,191,280       1,174,102       1,155,056    
Total liabilities and stockholders' equity   $ 11,747,295     $ 11,602,752       $ 11,102,082       $ 10,939,713       $ 10,793,494      
                       
Interest rate spread     2.78 %   2.89 %   3.04 %   3.06 %   3.00 %
Net interest margin (FTE)1     2.88 %   3.00 %   3.17 %   3.20 %   3.17 %
                       


NBT Bancorp Inc. and Subsidiaries
Average Year-to-Date Balance Sheets
(unaudited, dollars in thousands)
               
    Average   Yield/ Average   Yield/
    Balance Interest Rates Balance Interest Rates
Nine Months Ended September 30,   2021 2020
Assets              
Short-term interest bearing accounts   $ 860,067   $ 763   0.12 % $ 311,577   $ 464   0.20 %
Securities available for sale1 5     1,438,117     17,204   1.60 %   1,028,962     16,956   2.20 %
Securities held to maturity1 5     623,284     10,237   2.20 %   619,379     12,562   2.71 %
Investment in FRB and FHLB Banks     25,290     443   2.34 %   35,349     1,674   6.33 %
Loans1 6     7,555,276     222,821   3.94 %   7,437,566     231,168   4.15 %
Total interest earning assets   $ 10,502,034   $ 251,468   3.20 % $ 9,432,833   $ 262,824   3.72 %
Other assets     984,372         938,296      
Total assets   $ 11,486,406       $ 10,371,129      
               
Liabilities and stockholders' equity              
Money market deposit accounts   $ 2,557,172   $ 4,022   0.21 % $ 2,275,765   $ 8,646   0.51 %
NOW deposit accounts     1,419,102     531   0.05 %   1,153,780     548   0.06 %
Savings deposits     1,633,941     625   0.05 %   1,369,219     553   0.05 %
Time deposits     590,385     3,404   0.77 %   762,548     8,436   1.48 %
Total interest bearing deposits   $ 6,200,600   $ 8,582   0.19 % $ 5,561,312   $ 18,183   0.44 %
Short-term borrowings     103,314     130   0.17 %   412,312     3,215   1.04 %
Long-term debt     15,976     301   2.52 %   64,165     1,184   2.46 %
Subordinated debt, net     98,204     4,077   5.55 %   35,750     1,503   5.62 %
Junior subordinated debt     101,196     1,572   2.08 %   101,196     2,186   2.89 %
Total interest bearing liabilities   $ 6,519,290   $ 14,662   0.30 % $ 6,174,735   $ 26,271   0.57 %
Demand deposits     3,514,005         2,800,297      
Other liabilities     243,525         256,226      
Stockholders' equity     1,209,586         1,139,871      
Total liabilities and stockholders' equity   $ 11,486,406       $ 10,371,129      
Net interest income (FTE)1     $ 236,806       $ 236,553    
Interest rate spread       2.90 %     3.15 %
Net interest margin (FTE)1       3.01 %     3.35 %
Taxable equivalent adjustment     $ 899       $ 983    
Net interest income     $ 235,907       $ 235,570    
               


1 The following tables provide the Non-GAAP reconciliations for the Non-GAAP measures contained in this release:
             
  Non-GAAP measures          
  (unaudited, dollars in thousands)          
             
  Pre-provision net revenue ("PPNR")   2021     2020  
    3rd Q 2nd Q 1st Q 4th Q 3rd Q
  Net income $ 37,433   $ 40,296   $ 39,846   $ 34,194   $ 35,113  
  Income tax expense   11,043     11,995     11,155     9,432     10,988  
  Provision for loan losses   (3,342 )   (5,216 )   (2,796 )   (607 )   3,261  
  FTE adjustment   298     299     302     318     325  
  Net securities losses (gains)   100     (201 )   (467 )   (160 )   (84 )
  Provision for unfunded loan commitments reserve   (470 )   (80 )   (500 )   900     -  
  Nonrecurring expense   2,288     1,880     -     4,100     -  
  PPNR $ 47,350   $ 48,973   $ 47,540   $ 48,177   $ 49,603  
             
  Average Assets $ 11,747,295   $ 11,602,757   $ 11,102,082   $ 10,939,713   $ 10,793,494  
             
  Return on Average Assets3   1.26 %   1.39 %   1.46 %   1.24 %   1.29 %
  PPNR Return on Average Assets3   1.60 %   1.69 %   1.74 %   1.75 %   1.83 %
             
    9 Months Ended
September 30,
     
      2021     2020        
  Net income $ 117,575   $ 70,194        
  Income tax expense   34,193     19,267        
  Provision for loan losses   (11,354 )   51,741        
  FTE adjustment   899     983        
  Net securities (gains) losses   (568 )   548        
  Provision for unfunded loan commitments reserve   (1,050 )   1,800        
  Nonrecurring expense   4,168     650        
  PPNR $ 143,863   $ 145,183        
             
  Average Assets $ 11,486,406   $ 10,371,129        
             
  Return on Average Assets3   1.37 %   0.90 %      
  PPNR Return on Average Assets3   1.67 %   1.87 %      
             
  PPNR is a Non-GAAP financial measure that management believes is useful in evaluating the underlying operating results of the Company excluding the volatility in the provision for loan losses, net securities gains (losses) and non-recurring income and/or expense.
 
             
  FTE Adjustment   2021     2020  
    3rd Q 2nd Q 1st Q 4th Q 3rd Q
  Net interest income $ 77,674   $ 79,178   $ 79,055   $ 80,108   $ 77,943  
  Add: FTE adjustment   298     299     302     318     325  
  Net interest income (FTE) $ 77,972   $ 79,477   $ 79,357   $ 80,426   $ 78,268  
  Average earning assets $ 10,727,498   $ 10,631,071   $ 10,141,088   $ 9,985,590   $ 9,826,300  
  Net interest margin (FTE)3   2.88 %   3.00 %   3.17 %   3.20 %   3.17 %
             
    9 Months Ended
September 30,
     
      2021     2020        
  Net interest income $ 235,907   $ 235,570        
  Add: FTE adjustment   899     983        
  Net interest income (FTE) $ 236,806   $ 236,553        
  Average earning assets $ 10,502,034   $ 9,432,833        
  Net interest margin (FTE)3   3.01 %   3.35 %      
             
  Interest income for tax-exempt securities and loans have been adjusted to a FTE basis using the statutory Federal income tax rate of 21%.


1 The following tables provide the Non-GAAP reconciliations for the Non-GAAP measures contained in this release:
             
  Non-GAAP measures          
  (unaudited, dollars in thousands)          
             
  Tangible equity to tangible assets   2021     2020  
    3rd Q 2nd Q 1st Q 4th Q 3rd Q
  Total equity $ 1,241,457   $ 1,225,056   $ 1,190,981   $ 1,187,618   $ 1,166,111  
  Intangible assets   290,119     290,782     291,464     292,276     293,098  
  Total assets $ 11,994,411   $ 11,574,947   $ 11,537,253   $ 10,932,906   $ 10,850,212  
  Tangible equity to tangible assets   8.13 %   8.28 %   8.00 %   8.41 %   8.27 %
             
  Return on average tangible common equity   2021     2020  
    3rd Q 2nd Q 1st Q 4th Q 3rd Q
  Net income $ 37,433   $ 40,296   $ 39,846   $ 34,194   $ 35,113  
  Amortization of intangible assets (net of tax)   497     512     609     617     642  
  Net income, excluding intangibles amortization $ 37,930   $ 40,808   $ 40,455   $ 34,811   $ 35,755  
             
  Average stockholders' equity $ 1,233,045   $ 1,203,974   $ 1,191,280   $ 1,174,102   $ 1,155,056  
  Less: average goodwill and other intangibles   290,492     291,133     291,921     292,725     293,572  
  Average tangible common equity $ 942,553   $ 912,841   $ 899,359   $ 881,377   $ 861,484  
  Return on average tangible common equity3   15.97 %   17.93 %   18.24 %   15.71 %   16.51 %
             
    9 Months Ended
September 30,
     
      2021     2020        
  Net income $ 117,575   $ 70,194        
  Amortization of intangible assets (net of tax)   1,618     1,930        
  Net income, excluding intangibles amortization $ 119,193   $ 72,124        
             
  Average stockholders' equity $ 1,209,586   $ 1,139,871        
  Less: average goodwill and other intangibles   291,177     291,472        
  Average tangible common equity $ 918,409   $ 848,399        
  Return on average tangible common equity3   17.35 %   11.36 %      
             
2 Non-GAAP measure - Stockholders' equity less goodwill and intangible assets divided by common shares outstanding.  
3 Annualized.          
4 Total past due loans, defined as loans 30 days or more past due and in an accrual status.    
5 Securities are shown at average amortized cost.        
6 For purposes of these computations, nonaccrual loans and loans held for sale are included in the average loan balances outstanding.
             


Contact: John H. Watt, Jr., President and CEO
Scott A. Kingsley, Executive Vice President and CFO
NBT Bancorp Inc.
52 South Broad Street
Norwich, NY 13815
607-337-6589

 


NBT Bancorp Inc.

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