UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549



FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported): October 26, 2021


 
NBT BANCORP INC.
(Exact name of registrant as specified in its charter)
 
Delaware
000-14703
16-1268674
(State or other jurisdiction of incorporation or organization) (Commission File Number) (I.R.S. Employer Identification No.)
 
52 South Broad Street, Norwich, New York 13815
(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (607) 337-2265

Not Applicable
(Former name or former address, if changed since last report)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)


Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of class
 
Trading Symbol
 
Name of exchange on which registered
Common Stock, par value $0.01 per share
 
NBTB
 
The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
 
Emerging growth company
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐



Item 2.02
Results of Operations and Financial Condition

On October 26, 2021, NBT Bancorp Inc. issued a press release describing its results of operations for the quarter ended September 30, 2021. That press release is furnished as Exhibit 99.1 hereto. A conference call will be held at 8:30 a.m. Eastern Time on Wednesday, October 27, 2021, to review the third quarter 2021 financial results. The audio webcast link, along with the corresponding presentation slides, will be available on the Event Calendar page of the Company’s website at www.nbtbancorp.com.
 
Item 9.01
Financial Statements and Exhibits.
 
(a)          Not applicable.
 
(b)          Not applicable.
 
(c)          Not applicable.
 
(d)          Exhibits.
 
Exhibit No.
 
Description
     
 
Press release of NBT Bancorp Inc. October 26, 2021
     
104
 
Cover Page Interactive Data File (embedded within the Inline XBRL document)


SIGNATURE
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
NBT BANCORP INC.
 
 
 
Date: October 26, 2021
By:
/s/ Scott A. Kingsley
 
 
Scott A. Kingsley
 
 
Executive Vice President
   
and Chief Financial Officer
 



Exhibit 99.1

1

FOR IMMEDIATE RELEASE
ATTENTION: FINANCIAL AND BUSINESS EDITORS

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. ANNOUNCES THIRD QUARTER NET INCOME OF $37.4 MILLION ($0.86 PER DILUTED COMMON SHARE); APPROVES DIVIDEND

NORWICH, NY (October 26, 2021) – 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.”


2
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:

o
$84.7 million of loans forgiven

o
$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.


3
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:

o
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%.

o
The average balance of investment securities increased $112.8 million while yields declined 11 bps.

o
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.


4

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.


5
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.


6
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.


7
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.


8
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
 
 

9
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
 


10
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


11
NBT Bancorp Inc. and Subsidiaries
                     
Consolidated Statements of Income
                     
(unaudited, dollars in thousands except per share data)
                 
                       
   
Three Months Ended
September 30,
   
Nine Months Ended
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


12
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


13
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