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 25, 2022

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 25, 2022, NBT Bancorp Inc. issued a press release describing its results of operations for the quarter ended September 30, 2022. 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 26, 2022, to review the third quarter 2022 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 25, 2022
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 25, 2022
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 $39.0 MILLION ($0.90 PER DILUTED COMMON SHARE); APPROVES DIVIDEND

NORWICH, NY (October 25, 2022) – 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, 2022.
 
Net income for the three months ended September 30, 2022 was $39.0 million, or $0.90 per diluted common share, compared to $37.4 million, or $0.86 per diluted share, in the third quarter of 2021 and $37.8 million, or $0.88 per diluted share, in the second quarter of 2022. Net interest income recognized in the third quarter of 2022 from the Paycheck Protection Program (“PPP”) was approximately $0.3 million (less than $0.01 per diluted share), compared to $2.9 million ($0.05 per diluted share) in the third quarter of 2021 and $1.3 million ($0.02 per diluted share) in the second quarter of 2022. Net interest income in the third quarter of 2022 improved in comparison to the third quarter of 2021 and the linked second quarter of 2022, primarily due to higher yields on earning assets due to increases in the Federal Reserve’s targeted Federal Funds rate combined with growth in earning assets. The Company recorded a provision for loan losses of $4.5 million ($0.08 per diluted share) in the third quarter of 2022, compared to a net benefit of $3.3 million ($0.06 per diluted share) in the third quarter of 2021 and a provision of $4.4 million ($0.08 per diluted share) in the second quarter of 2022.
 
CEO Comments

“We are very pleased with our operating results for the third quarter and first nine months of 2022, which reflect strong execution by our team including solid organic loan growth and disciplined cost of funds management. With additional increases in the targeted Fed Funds rate, we continue to experience the benefits of an asset-sensitive balance sheet,” said NBT President and CEO John H. Watt, Jr. “Our asset quality continues to be excellent, with low levels of net charge-offs and nonperforming assets. Our fee-based businesses reported solid results despite the inherent headwinds associated with lower equity market valuations. Our improved net interest income generation overcame the $4 million or, seven cents per share, reduction in debit interchange revenue due to the Company being subject to the Durbin Amendment of the Dodd-Frank Act beginning in the third quarter of 2022.”


2
Third Quarter Financial Highlights

Net Income
    Net income of $39.0 million
    Diluted earnings per share of $0.90
Net Interest Income / NIM
    Net interest income on a fully taxable equivalent (“FTE”) basis was $94.8 million1
    Net interest margin (“NIM”) on a FTE basis was 3.51%1, up 30 basis points (“bps”) from the prior quarter, due primarily to higher yields on earning assets
   Total cost of deposits of 0.09%, up 2 bps from the prior quarter
Noninterest Income
    Noninterest income was $37.3 million, excluding securities gains (losses) and was 28.3% of total revenue
Pre-Provision Net
Revenue (“PPNR”)
    PPNR1 was $55.7 million compared to $54.2 million in the second quarter of 2022 and $47.4 million in the third quarter of 2021
Loans and Credit
Quality
    Period end total loans were $7.90 billion at September 30, 2022, up 9.1%, annualized, excluding impact of PPP loans
    Period end loans increased $504.2 million from December 31, 2021, excluding $3.3 million and $101.2 million of PPP loans at September 30, 2022 and December 31, 2021, respectively
   Net charge-offs to average loans was 0.07%, annualized
    Nonperforming loans to total loans was 0.28%, down from 0.33% in the prior quarter
    Allowance for loan losses to total loans of 1.22%, up 2 bps from the second quarter of 2022 due primarily to loan growth
Capital
    Announced a $0.30 per share dividend for the fourth quarter, which was a $0.02 per share, or 7.1%, increase from the fourth quarter of 2021
   Stockholders’ equity decreased $93.9 million from December 31, 2021, driven by a $160.9 million decrease in accumulated other comprehensive income (“AOCI”) due to the change in the market value of securities available for sale, dividends declared of $36.9 million and the repurchase of common stock of $14.7 million, partly offset by net income generation of $115.9 million
    Tangible book value per share2 was $20.25 at September 30, 2022, modestly lower than the third quarter of 2021 and the second quarter of 2022, due primarily to the impact of higher interest rates on available for sale investment securities and the related impact to AOCI
    Tangible equity to assets of 7.64%1
    CET1 ratio of 12.17%; Leverage ratio of 10.21%

Loans


Period end total loans were $7.90 billion at September 30, 2022 and $7.50 billion at December 31, 2021.

Excluding PPP loans, period end loans increased $504.2 million from December 31, 2021. Commercial and industrial loans increased $103.6 million to $1.26 billion; commercial real estate loans increased $69.4 million to $2.72 billion; and total consumer loans increased $331.2 million to $3.92 billion.


3

Total PPP loans as of September 30, 2022 were $3.3 million (net of unamortized fees) with over 99% of the original $836 million forgiven or extinguished through the third quarter of 2022. The following PPP loan activity occurred during the third quarter of 2022:

o
$14.2 million of loans forgiven.

o
$0.3 million of interest and fees recognized into interest income, compared to $1.3 million for the second quarter of 2022 and $2.9 million for the third quarter of 2021.

Commercial line of credit utilization rate was 23% at September 30, 2022 and June 30, 2022, compared to 21% at September 30, 2021.

Deposits


Total deposits at September 30, 2022 were $9.92 billion, compared to $10.23 billion at December 31, 2021, representing a 3% decline, which included a $100.0 million brokered deposit secured for liquidity uncertainty purposes early in the pandemic that matured in the prior quarter and declines in money markets deposits driven by certain large customers moving approximately $100 million of their deposit balances to an off-balance sheet, Company-designated short-term treasury product.

Loan to deposit ratio was 79.7% at September 30, 2022, compared to 73.3% at December 31, 2021.

Net Interest Income and Net Interest Margin
 

Net interest income for the third quarter of 2022 was $94.5 million, which was up $6.9 million, or 7.9%, from the second quarter of 2022 and up $16.8 million, or 21.6%, from the third quarter of 2021 primarily due to higher yields on earning assets. PPP income for the third quarter of 2022 was $0.3 million, which was $1.0 million lower compared to the prior quarter and down $2.5 million compared to the third quarter of 2021.

The NIM on a FTE basis for the third quarter of 2022 was 3.51%, up 30 bps from the second quarter of 2022 and up 63 bps from the third quarter of 2021 due to higher earning asset yields partly offset by higher cost of interest-bearing liabilities.

Earning asset yields for the three months ended September 30, 2022 were up 33 bps from the prior quarter and up 63 bps from the same quarter in the prior year. Earning assets declined $255.7 million, or 2.3%, from the prior quarter and were comparable to the same quarter in the prior year. The following are highlights comparing the third quarter of 2022 to the prior quarter:

o
Loan yields increased 25 bps to 4.34% for the quarter. Excluding PPP loans, loan yields increased 28 bps from the prior quarter.

o
The average balances of investment securities increased $5.9 million and yields increased 13 bps.

o
The average balances of short-term interest-bearing accounts decreased $362.1 million resulting from the incremental deployment of excess liquidity into loans and investment securities and modestly lower deposit balances.

Total cost of deposits was 0.09% for the third quarter of 2022, up 2 bps from the prior quarter and down 1 bp from the same period in the prior year.

The cost of total interest-bearing liabilities for the three months ended September 30, 2022 was 0.29%, up 6 bps from the prior quarter and up 2 bps from the third quarter of 2021.

Credit Quality and Allowance for Credit Losses


Net charge-offs to total average loans was 7 bps compared to 4 bps in the prior quarter and 11 bps in the third quarter of 2021. Recoveries in the third quarter of 2022 were $3.4 million compared to $3.3 million in the prior quarter and $2.7 million in the third quarter of 2021.


4

Nonperforming assets to total assets was 0.19% compared to 0.22% at June 30, 2022 and 0.33% at September 30, 2021. Past due loans to total loans decreased to 0.30% as of September 30, 2022 from 0.40% in the prior quarter, primarily due to one commercial credit which returned to current status in early July.

Provision expense for the three months ended September 30, 2022 was $4.5 million with net charge-offs of $1.3 million. Provision expense was $0.1 million higher than the second quarter of 2022 and $7.8 million higher than the third quarter of 2021. The increase in provision expense from the third quarter of 2021 was driven both by loan growth and an increase in the level of allowance for loan losses resulting from less favorable economic forecasts in the current year relative to improving economic forecasts in the prior year, partly offset by a lower level of net charge-offs.

The allowance for loan losses was $96.8 million, or 1.22% (1.23% excluding PPP loans and related allowance) of total loans, at September 30, 2022, compared to 1.20% (1.21% excluding PPP loans and related allowance) of total loans at June 30, 2022 and 1.23% (1.28% excluding PPP loans and related allowance) of total loans at September 30, 2021. The increase in the level of allowance for loan losses from the prior quarter was primarily due to the increase in loan balances and the modest deterioration in the forecast of economic conditions, which had an impact on the level of expected credit losses.

The reserve for unfunded loan commitments increased to $5.3 million at September 30, 2022 compared to the prior quarter at $5.1 million and compared to the prior year quarter at $5.3 million.

Noninterest Income
 

Total noninterest income, excluding securities gains (losses), was $37.3 million for the three months ended September 30, 2022, down $4.9 million from the second quarter and down $3.1 million from the prior year’s third quarter.

Card services income was lower than the prior quarter and the third quarter of 2021 driven by the $3.8 million ($0.07 per diluted share) impact from the Company being subject to the statutory price cap provisions of the Durbin Amendment to the Dodd-Frank Act.

Retirement plan administration fees were lower than the prior quarter driven by market decline and lower activity-based fees and higher than the third quarter of 2021 driven by higher activity-based fees and organic growth.

Wealth management fees were higher than the prior quarter due to seasonal tax preparation services and lower than the third quarter of 2021 driven primarily by market performance.

Other income decreased from the prior quarter and the third quarter of 2021 driven by lower commercial loan swap fees.

Noninterest Expense


Total noninterest expense for the third quarter of 2022 was up 0.8% from the previous quarter and up 5.2% from the third quarter of 2021.

Salaries and benefits increased from the prior quarter due to one additional day of payroll in the third quarter and higher levels of incentive compensation accruals. The increase from the third quarter of 2021 was driven by increased salaries and wages, including merit pay increases and higher levels of incentive compensation accruals.


5

Technology and data services increased from the prior quarter and the third quarter of 2021 due to continued investment in digital platform solutions.

Other expenses decreased from the linked second quarter of 2022 due to seasonal timing of certain expenditures. The third quarter of 2021 also included $2.3 million of estimated litigation settlement costs.

Income Taxes
 

The effective tax rate was 22.8% for the third quarter of 2022 compared to 22.5% for the second quarter of 2022 and 22.8% for the third quarter of 2021.

Capital


Capital ratios remain strong with tangible common equity to tangible assets1 at 7.64%. Tangible book value per share2 was $20.25 at September 30, 2022, $20.99 at June 30, 2022 and $21.95 at September 30, 2021.

Stockholders’ equity decreased $93.9 million from December 31, 2021 driven by the $160.9 million decrease in AOCI due to the change in the market value of securities available for sale, dividends declared of $36.9 million and the repurchase of common stock of $14.7 million, partly offset by net income generation of $115.9 million.

September 30, 2022, CET1 capital ratio of 12.17%, leverage ratio of 10.21% and total risk-based capital ratio of 15.50%.

Dividend


The Board of Directors approved a fourth-quarter cash dividend of $0.30 per share at a meeting held yesterday, an increase of $0.02, or 7.1%, from the amount paid in the fourth quarter of 2021. 2022 is the tenth consecutive year of dividend increases by the Company. The dividend will be paid on December 15, 2022 to stockholders of record as of December 1, 2022.

Other Events


On August 1, 2022, NBT’s subsidiary, NBT Insurance Agency, LLC, a full-service insurance agency, completed the acquisition of substantially all of the assets of Harrison A. Rogers Agency, Inc. (“H.A. Rogers”). H.A. Rogers is a New York based small personal and commercial lines property and casualty insurance agency. This is a strategic regional insurance expansion into the northern New York market where NBT Bank has a long-established presence.

Conference Call and Webcast

The Company will host a conference call at 8:30 a.m. (Eastern) Wednesday, October 26, 2022, to review third quarter 2022 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.
 

6
Corporate Overview

NBT Bancorp Inc. is a financial holding company headquartered in Norwich, NY, with total assets of $11.64 billion at September 30, 2022. 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 national benefits administration 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 press 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, including international military conflicts, 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 COVID-19 global pandemic; and (21) the Company’s success at managing the risks involved in the foregoing items.


7
One of the more 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, treatment developments, public adoption rates of COVID-19 vaccines, including booster shots, and their effectiveness against emerging variants of COVID-19, the impact of the COVID-19 pandemic 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.

The Company cautions readers not to 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.


8
NBT Bancorp Inc. and Subsidiaries
Selected Financial Data
(unaudited, dollars in thousands except per share data)
   
2022
   
2021
 
   
3rd Q
   
2nd Q
   
1st Q
   
4th Q
   
3rd Q
 
Profitability:
                             
Diluted earnings per share
 
$
0.90
   
$
0.88
   
$
0.90
   
$
0.86
   
$
0.86
 
Weighted average diluted common shares outstanding
   
43,110,932
     
43,092,851
     
43,385,451
     
43,574,539
     
43,631,497
 
Return on average assets3
   
1.33
%
   
1.28
%
   
1.32
%
   
1.23
%
   
1.26
%
Return on average equity3
   
12.87
%
   
12.73
%
   
12.78
%
   
11.89
%
   
12.04
%
Return on average tangible common equity1 3
   
17.12
%
   
17.00
%
   
16.87
%
   
15.70
%
   
15.97
%
Net interest margin1 3
   
3.51
%
   
3.21
%
   
2.95
%
   
3.08
%
   
2.88
%

   
9 Months Ended September 30,
   
   
2022
   
2021
   
Profitability:
             
Diluted earnings per share
 
$
2.68
   
$
2.69
   
Weighted average diluted common shares outstanding
   
43,194,037
     
43,768,647
   
Return on average assets3
   
1.31
%
   
1.37
%
 
Return on average equity3
   
12.79
%
   
13.00
%
 
Return on average tangible common equity1 3
   
17.00
%
   
17.35
%
 
Net interest margin1 3
   
3.22
%
   
3.01
%
 

   
2022
   
2021
 
   
3rd Q
   
2nd Q
   
1st Q
   
4th Q
   
3rd Q
 
Balance sheet data:
                             
Short-term interest-bearing accounts
 
$
97,303
   
$
328,593
   
$
913,315
   
$
1,111,296
   
$
1,131,074
 
Securities available for sale
   
1,556,501
     
1,619,356
     
1,662,697
     
1,687,361
     
1,576,030
 
Securities held to maturity
   
929,541
     
936,512
     
895,005
     
733,210
     
683,103
 
Net loans
   
7,807,984
     
7,684,081
     
7,559,826
     
7,406,459
     
7,473,442
 
Total assets
   
11,640,742
     
11,720,459
     
12,147,833
     
12,012,111
     
11,994,411
 
Total deposits
   
9,918,751
     
10,028,708
     
10,461,623
     
10,234,469
     
10,195,178
 
Total borrowings
   
277,889
     
265,796
     
278,788
     
311,476
     
313,311
 
Total liabilities
   
10,484,196
     
10,531,903
     
10,945,583
     
10,761,658
     
10,752,954
 
Stockholders' equity
   
1,156,546
     
1,188,556
     
1,202,250
     
1,250,453
     
1,241,457
 
                                         
Capital:
                                       
Equity to assets
   
9.94
%
   
10.14
%
   
9.90
%
   
10.41
%
   
10.35
%
Tangible equity ratio1
   
7.64
%
   
7.87
%
   
7.70
%
   
8.20
%
   
8.13
%
Book value per share
 
$
27.00
   
$
27.75
   
$
27.96
   
$
28.97
   
$
28.65
 
Tangible book value per share2
 
$
20.25
   
$
20.99
   
$
21.25
   
$
22.26
   
$
21.95
 
Leverage ratio
   
10.21
%
   
9.77
%
   
9.52
%
   
9.41
%
   
9.47
%
Common equity tier 1 capital ratio
   
12.17
%
   
12.14
%
   
12.23
%
   
12.25
%
   
12.20
%
Tier 1 capital ratio
   
13.27
%
   
13.27
%
   
13.39
%
   
13.43
%
   
13.39
%
Total risk-based capital ratio
   
15.50
%
   
15.50
%
   
15.64
%
   
15.73
%
   
15.74
%
Common stock price (end of period)
 
$
37.95
   
$
37.59
   
$
36.13
   
$
38.52
   
$
36.12
 


9
NBT Bancorp Inc. and Subsidiaries
Asset Quality and Consolidated Loan Balances
(unaudited, dollars in thousands)

   
2022
   
2021
 
   
3rd Q
   
2nd Q
   
1st Q
   
4th Q
   
3rd Q
 
Asset quality:
                             
Nonaccrual loans
 
$
19,098
   
$
23,673
   
$
25,812
   
$
30,285
   
$
35,737
 
90 days past due and still accruing
   
2,732
     
2,096
     
1,944
     
2,458
     
2,940
 
Total nonperforming loans
   
21,830
     
25,769
     
27,756
     
32,743
     
38,677
 
Other real estate owned
   
-
     
-
     
-
     
167
     
859
 
Total nonperforming assets
   
21,830
     
25,769
     
27,756
     
32,910
     
39,536
 
Allowance for loan losses
   
96,800
     
93,600
     
90,000
     
92,000
     
93,000
 
                                         
Asset quality ratios (total):
                                       
Allowance for loan losses to total loans
   
1.22
%
   
1.20
%
   
1.18
%
   
1.23
%
   
1.23
%
Total nonperforming loans to total loans
   
0.28
%
   
0.33
%
   
0.36
%
   
0.44
%
   
0.51
%
Total nonperforming assets to total assets
   
0.19
%
   
0.22
%
   
0.23
%
   
0.27
%
   
0.33
%
Allowance for loan losses to total nonperforming loans
   
443.43
%
   
363.23
%
   
324.25
%
   
280.98
%
   
240.45
%
Past due loans to total loans4
   
0.30
%
   
0.40
%
   
0.24
%
   
0.29
%
   
0.46
%
Net charge-offs to average loans3
   
0.07
%
   
0.04
%
   
0.14
%
   
0.22
%
   
0.11
%
                                         
Asset quality ratios (excluding paycheck protection program):
                                       
Allowance for loan losses to total loans
   
1.23
%
   
1.21
%
   
1.18
%
   
1.24
%
   
1.28
%
Total nonperforming loans to total loans
   
0.28
%
   
0.33
%
   
0.37
%
   
0.44
%
   
0.53
%
Total nonperforming assets to total assets
   
0.19
%
   
0.22
%
   
0.23
%
   
0.28
%
   
0.34
%
Allowance for loan losses to total nonperforming loans
   
443.43
%
   
363.27
%
   
324.24
%
   
280.96
%
   
240.42
%
Past due loans to total loans4
   
0.29
%
   
0.40
%
   
0.25
%
   
0.29
%
   
0.48
%
Net charge-offs to average loans3
   
0.07
%
   
0.04
%
   
0.14
%
   
0.22
%
   
0.12
%

   
2022
   
2021
 
   
3rd Q
   
2nd Q
   
1st Q
   
4th Q
   
3rd Q
 
Allowance for loan losses as a percentage of loans by segment:
                             
Commercial & industrial
   
0.80
%
   
0.75
%
   
0.66
%
   
0.78
%
   
0.83
%
Commercial real estate
   
0.88
%
   
0.89
%
   
0.79
%
   
0.78
%
   
0.93
%
Paycheck protection program
   
0.01
%
   
0.01
%
   
0.01
%
   
0.01
%
   
0.01
%
Residential real estate
   
0.74
%
   
0.79
%
   
0.88
%
   
0.92
%
   
0.93
%
Auto
   
0.78
%
   
0.79
%
   
0.76
%
   
0.79
%
   
0.78
%
Other consumer
   
3.95
%
   
3.98
%
   
4.14
%
   
4.49
%
   
4.57
%
Total
   
1.22
%
   
1.20
%
   
1.18
%
   
1.23
%
   
1.23
%
Total excluding PPP loans
   
1.23
%
   
1.21
%
   
1.18
%
   
1.24
%
   
1.28
%

   
2022
   
2021
 
Loans by line of business:
 
3rd Q
   
2nd Q
   
1st Q
   
4th Q
   
3rd Q
 
Commercial & industrial
 
$
1,258,871
   
$
1,298,072
   
$
1,214,834
   
$
1,155,240
   
$
1,148,176
 
Commercial real estate
   
2,724,728
     
2,670,633
     
2,709,611
     
2,655,367
     
2,638,762
 
Paycheck protection program
   
3,328
     
17,286
     
50,977
     
101,222
     
276,195
 
Residential real estate mortgages
   
1,626,528
     
1,606,188
     
1,584,551
     
1,571,232
     
1,549,684
 
Indirect auto
   
952,757
     
936,516
     
890,643
     
859,454
     
873,860
 
Residential solar
   
728,898
     
599,565
     
514,526
     
440,016
     
365,299
 
Home equity
   
313,557
     
313,395
     
319,180
     
330,357
     
339,316
 
Other consumer
   
296,117
     
336,026
     
365,504
     
385,571
     
375,150
 
Total loans
 
$
7,904,784
   
$
7,777,681
   
$
7,649,826
   
$
7,498,459
   
$
7,566,442
 
                                         
PPP income recognized
 
$
320
   
$
1,301
   
$
1,976
   
$
7,545
   
$
2,861
 
PPP unamortized fees
 
$
108
   
$
414
   
$
1,629
   
$
3,420
   
$
10,536
 


10
NBT Bancorp Inc. and Subsidiaries
Consolidated Balance Sheets
(unaudited, dollars in thousands)

    
September 30,
2022
     
December 31,
2021
  
Assets
Cash and due from banks
 
$
223,755
   
$
157,775
 
Short-term interest-bearing accounts
   
97,303
     
1,111,296
 
Equity securities, at fair value
   
30,428
     
33,550
 
Securities available for sale, at fair value
   
1,556,501
     
1,687,361
 
Securities held to maturity (fair value $814,100 and $735,260, respectively)
   
929,541
     
733,210
 
Federal Reserve and Federal Home Loan Bank stock
   
24,892
     
25,098
 
Loans held for sale
   
87
     
830
 
Loans
   
7,904,784
     
7,498,459
 
Less allowance for loan losses
   
96,800
     
92,000
 
Net loans
 
$
7,807,984
   
$
7,406,459
 
Premises and equipment, net
   
69,338
     
72,093
 
Goodwill
   
281,204
     
280,541
 
Intangible assets, net
   
7,879
     
8,927
 
Bank owned life insurance
   
230,990
     
228,238
 
Other assets
   
380,840
     
266,733
 
Total assets
 
$
11,640,742
   
$
12,012,111
 
                 
Liabilities and stockholders' equity
               
Demand (noninterest bearing)
 
$
3,714,342
   
$
3,689,556
 
Savings, NOW and money market
   
5,758,736
     
6,043,441
 
Time
   
445,673
     
501,472
 
Total deposits
 
$
9,918,751
   
$
10,234,469
 
Short-term borrowings
   
74,554
     
97,795
 
Long-term debt
   
3,322
     
13,995
 
Subordinated debt, net
   
98,817
     
98,490
 
Junior subordinated debt
   
101,196
     
101,196
 
Other liabilities
   
287,556
     
215,713
 
Total liabilities
 
$
10,484,196
   
$
10,761,658
 
                 
Total stockholders' equity
 
$
1,156,546
   
$
1,250,453
 
                 
Total liabilities and stockholders' equity
 
$
11,640,742
   
$
12,012,111
 


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,
  
 
   
2022
   
2021
   
2022
   
2021
 
Interest, fee and dividend income
                       
Interest and fees on loans
 
$
85,266
   
$
72,817
   
$
237,148
   
$
222,705
 
Securities available for sale
   
7,665
     
5,898
     
21,822
     
17,204
 
Securities held to maturity
   
4,854
     
2,976
     
12,532
     
9,454
 
Other
   
1,429
     
524
     
3,396
     
1,206
 
Total interest, fee and dividend income
 
$
99,214
   
$
82,215
   
$
274,898
   
$
250,569
 
Interest expense
                               
Deposits
 
$
2,233
   
$
2,548
   
$
5,831
   
$
8,582
 
Short-term borrowings
   
84
     
28
     
113
     
130
 
Long-term debt
   
20
     
89
     
140
     
301
 
Subordinated debt
   
1,360
     
1,359
     
4,078
     
4,077
 
Junior subordinated debt
   
1,039
     
517
     
2,325
     
1,572
 
Total interest expense
 
$
4,736
   
$
4,541
   
$
12,487
   
$
14,662
 
Net interest income
 
$
94,478
   
$
77,674
   
$
262,411
   
$
235,907
 
Provision for loan losses
   
4,484
     
(3,342
)
   
9,470
     
(11,354
)
Net interest income after provision for loan losses
 
$
89,994
   
$
81,016
   
$
252,941
   
$
247,261
 
Noninterest income
                               
Service charges on deposit accounts
 
$
3,581
   
$
3,489
   
$
11,032
   
$
9,544
 
Card services income
   
5,654
     
9,101
     
24,100
     
25,835
 
Retirement plan administration fees
   
11,496
     
10,495
     
37,451
     
30,372
 
Wealth management
   
8,402
     
8,783
     
25,294
     
25,099
 
Insurance services
   
3,892
     
3,720
     
11,258
     
10,689
 
Bank owned life insurance income
   
1,560
     
1,548
     
4,625
     
4,588
 
Net securities (losses) gains
   
(148
)
   
(100
)
   
(914
)
   
568
 
Other
   
2,735
     
3,293
     
8,641
     
9,988
 
Total noninterest income
 
$
37,172
   
$
40,329
   
$
121,487
   
$
116,683
 
Noninterest expense
                               
Salaries and employee benefits
 
$
48,371
   
$
44,190
   
$
140,595
   
$
128,462
 
Technology and data services
   
9,096
     
8,421
     
26,588
     
26,154
 
Occupancy
   
6,481
     
6,154
     
19,761
     
19,413
 
Professional fees and outside services
   
3,817
     
3,784
     
11,999
     
11,403
 
Office supplies and postage
   
1,469
     
1,364
     
4,441
     
4,478
 
FDIC expense
   
787
     
772
     
2,399
     
2,243
 
Advertising
   
559
     
583
     
1,943
     
1,502
 
Amortization of intangible assets
   
544
     
663
     
1,725
     
2,157
 
Loan collection and other real estate owned, net
   
549
     
706
     
1,690
     
1,959
 
Other
   
5,021
     
6,232
     
13,815
     
14,405
 
Total noninterest expense
 
$
76,694
   
$
72,869
   
$
224,956
   
$
212,176
 
Income before income tax expense
 
$
50,472
   
$
48,476
   
$
149,472
   
$
151,768
 
Income tax expense
   
11,499
     
11,043
     
33,598
     
34,193
 
Net income
 
$
38,973
   
$
37,433
   
$
115,874
   
$
117,575
 
Earnings Per Share
                               
Basic
 
$
0.91
   
$
0.86
   
$
2.70
   
$
2.71
 
Diluted
 
$
0.90
   
$
0.86
   
$
2.68
   
$
2.69
 


12

 
NBT Bancorp Inc. and Subsidiaries
Quarterly Consolidated Statements of Income
(unaudited, dollars in thousands except per share data)

   
2022
   
2021
 
   
3rd Q
   
2nd Q
   
1st Q
   
4th Q
   
3rd Q
 
Interest, fee and dividend income
                             
Interest and fees on loans
 
$
85,266
   
$
78,539
   
$
73,343
   
$
79,470
   
$
72,817
 
Securities available for sale
   
7,665
     
7,317
     
6,840
     
6,101
     
5,898
 
Securities held to maturity
   
4,854
     
4,185
     
3,493
     
3,097
     
2,976
 
Other
   
1,429
     
1,442
     
525
     
639
     
524
 
Total interest, fee and dividend income
 
$
99,214
   
$
91,483
   
$
84,201
   
$
89,307
   
$
82,215
 
Interest expense
                                       
Deposits
 
$
2,233
   
$
1,756
   
$
1,842
   
$
2,132
   
$
2,548
 
Short-term borrowings
   
84
     
13
     
16
     
28
     
28
 
Long-term debt
   
20
     
33
     
87
     
88
     
89
 
Subordinated debt
   
1,360
     
1,359
     
1,359
     
1,360
     
1,359
 
Junior subordinated debt
   
1,039
     
737
     
549
     
518
     
517
 
Total interest expense
 
$
4,736
   
$
3,898
   
$
3,853
   
$
4,126
   
$
4,541
 
Net interest income
 
$
94,478
   
$
87,585
   
$
80,348
   
$
85,181
   
$
77,674
 
Provision for loan losses
   
4,484
     
4,390
     
596
     
3,097
     
(3,342
)
Net interest income after provision for loan losses
 
$
89,994
   
$
83,195
   
$
79,752
   
$
82,084
   
$
81,016
 
Noninterest income
                                       
Service charges on deposit accounts
 
$
3,581
   
$
3,763
   
$
3,688
   
$
3,804
   
$
3,489
 
Card services income
   
5,654
     
9,751
     
8,695
     
8,847
     
9,101
 
Retirement plan administration fees
   
11,496
     
12,676
     
13,279
     
11,816
     
10,495
 
Wealth management
   
8,402
     
8,252
     
8,640
     
8,619
     
8,783
 
Insurance services
   
3,892
     
3,578
     
3,788
     
3,394
     
3,720
 
Bank owned life insurance income
   
1,560
     
1,411
     
1,654
     
1,629
     
1,548
 
Net securities (losses)
   
(148
)
   
(587
)
   
(179
)
   
(2
)
   
(100
)
Other
   
2,735
     
2,812
     
3,094
     
3,004
     
3,293
 
Total noninterest income
 
$
37,172
   
$
41,656
   
$
42,659
   
$
41,111
   
$
40,329
 
Noninterest expense
                                       
Salaries and employee benefits
 
$
48,371
   
$
46,716
   
$
45,508
   
$
44,118
   
$
44,190
 
Technology and data services
   
9,096
     
8,945
     
8,547
     
8,563
     
8,421
 
Occupancy
   
6,481
     
6,487
     
6,793
     
6,635
     
6,154
 
Professional fees and outside services
   
3,817
     
3,906
     
4,276
     
4,903
     
3,784
 
Office supplies and postage
   
1,469
     
1,548
     
1,424
     
1,528
     
1,364
 
FDIC expense
   
787
     
810
     
802
     
798
     
772
 
Advertising
   
559
     
730
     
654
     
1,019
     
583
 
Amortization of intangible assets
   
544
     
545
     
636
     
651
     
663
 
Loan collection and other real estate owned, net
   
549
     
757
     
384
     
956
     
706
 
Other
   
5,021
     
5,675
     
3,119
     
5,934
     
6,232
 
Total noninterest expense
 
$
76,694
   
$
76,119
   
$
72,143
   
$
75,105
   
$
72,869
 
Income before income tax expense
 
$
50,472
   
$
48,732
   
$
50,268
   
$
48,090
   
$
48,476
 
Income tax expense
   
11,499
     
10,957
     
11,142
     
10,780
     
11,043
 
Net income
 
$
38,973
   
$
37,775
   
$
39,126
   
$
37,310
   
$
37,433
 
Earnings Per Share
                                       
Basic
 
$
0.91
   
$
0.88
   
$
0.91
   
$
0.86
   
$
0.86
 
Diluted
 
$
0.90
   
$
0.88
   
$
0.90
   
$
0.86
   
$
0.86
 


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 - 2022
   
Q2 - 2022
   
Q1 - 2022
   
Q4 - 2021
   
Q3 - 2021
 
Assets
                                                       
Short-term interest-bearing accounts
 
$
191,463
 
2.51
%
 
$
553,548
 
0.82
%
 
$
990,319
 
0.17
%
 
$
1,145,794
 
0.16
%
 
$
1,014,120
 
0.16
%
Securities taxable1
   
2,491,315
 
1.83
%
   
2,439,960
 
1.74
%
   
2,284,578
 
1.67
%
   
2,081,796
 
1.57
%
   
1,923,700
 
1.63
%
Securities tax-exempt 1 5
   
211,306
 
2.47
%
   
256,799
 
1.83
%
   
258,513
 
1.84
%
   
257,320
 
1.85
%
   
246,685
 
1.97
%
FRB and FHLB stock
   
25,182
 
3.47
%
   
24,983
 
5.03
%
   
25,026
 
1.98
%
   
25,149
 
2.74
%
   
25,154
 
1.91
%
Loans1 6
   
7,808,025
 
4.34
%
   
7,707,730
 
4.09
%
   
7,530,674
 
3.95
%
   
7,507,165
 
4.20
%
   
7,517,839
 
3.84
%
Total interest-earning assets
 
$
10,727,291
 
3.68
%
 
$
10,983,020
 
3.35
%
 
$
11,089,110
 
3.09
%
 
$
11,017,224
 
3.23
%
 
$
10,727,498
 
3.05
%
Other assets
   
887,378
         
883,498
         
947,578
         
982,136
         
1,019,797
     
Total assets
 
$
11,614,669
       
$
11,866,518
       
$
12,036,688
       
$
11,999,360
       
$
11,747,295
     
Liabilities and stockholders' equity
                                                           
Money market deposit accounts
 
$
2,332,341
 
0.15
%
 
$
2,577,367
 
0.14
%
 
$
2,720,338
 
0.15
%
 
$
2,678,477
 
0.16
%
 
$
2,580,570
 
0.19
%
NOW deposit accounts
   
1,548,115
 
0.21
%
   
1,580,132
 
0.07
%
   
1,583,091
 
0.05
%
   
1,551,846
 
0.05
%
   
1,442,678
 
0.05
%
Savings deposits
   
1,854,122
 
0.03
%
   
1,845,128
 
0.03
%
   
1,794,549
 
0.03
%
   
1,725,004
 
0.05
%
   
1,691,539
 
0.05
%
Time deposits
   
455,168
 
0.35
%
   
478,531
 
0.37
%
   
494,632
 
0.40
%
   
537,875
 
0.46
%
   
565,216
 
0.62
%
Total interest-bearing deposits
 
$
6,189,746
 
0.14
%
 
$
6,481,158
 
0.11
%
 
$
6,592,610
 
0.11
%
 
$
6,493,202
 
0.13
%
 
$
6,280,003
 
0.16
%
Federal funds purchased
   
1,522
 
3.39
%
   
-
 
-
     
-
 
-
     
65
 
-
     
-
 
-
 
Repurchase agreements
   
69,048
 
0.10
%
   
60,061
 
0.09
%
   
72,768
 
0.09
%
   
97,389
 
0.11
%
   
99,703
 
0.11
%
Short-term borrowings
   
6,440
 
3.33
%
   
-
 
-
     
-
 
-
     
1
 
-
     
-
 
-
 
Long-term debt
   
3,331
 
2.38
%
   
5,336
 
2.48
%
   
13,979
 
2.52
%
   
14,004
 
2.49
%
   
14,029
 
2.52
%
Subordinated debt, net
   
98,748
 
5.46
%
   
98,642
 
5.53
%
   
98,531
 
5.59
%
   
98,422
 
5.48
%
   
98,311
 
5.48
%
Junior subordinated debt
   
101,196
 
4.07
%
   
101,196
 
2.92
%
   
101,196
 
2.20