NBT Bancorp, Inc.

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Press Release $NBTB NBT Bancorp, Inc.

0 COMMENTs 22 Jul
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NBT Bancorp Inc. Announces 2013 Second Quarter Earnings

Highlights:

  • Core Diluted EPS $0.40, up from $0.39 in the first quarter
     
  • Loan growth for the second quarter was 7.4% (annualized)
     
  • Net Interest Margin was stable at 3.69%
     
  • Leading asset quality indicators showed continued improvement in Q2

NORWICH, N.Y., July 22, 2013 (GLOBE NEWSWIRE) -- NBT Bancorp Inc. (NBT) (Nasdaq:NBTB) reported today net income for the three months ended June 30, 2013 was $16.9 million, up from $7.6 million from the prior quarter, which included $10.7 million in merger related expenses. Reported results from the second quarter of 2013 include the impact of the acquisition of Alliance Financial Corporation ("Alliance"), and $1.3 million in merger related expenses. Reported earnings per diluted share for the three months ended June 30, 2013 was $0.38 as compared to $0.21 from the previous quarter.

Core net income for the three months ended June 30, 2013 was $17.8 million, up 25.0% from $14.3 million from the previous quarter, due primarily to the full quarter impact from the March 8, 2013 acquisition of Alliance. Core diluted earnings per share for the three months ended June 30, 2013 was $0.40, up from $0.39 for the previous quarter.

Reported net income from the six months ended June 30, 2013 was $24.6 million, down from $26.9 million for the same period last year. 2013 results included the impact of the acquisition of Alliance, including approximately $12.0 million in merger related expenses. Reported diluted earnings per share for the six months ended June 30, 2013 was $0.61, as compared to $0.80 for the same period in 2012.

Core net income for the six months ended June 30, 2013 was $32.1 million, up 19.6% from $26.8 million from the same period in 2012, due primarily to the impact of the Alliance acquisition. Core diluted earnings per share for the six months ended June 30, 2013 was $0.79, as compared to $0.80 for the same period last year.

"We are pleased to report that NBT continued to produce strong results through the first two quarters of 2013," said NBT CEO Martin Dietrich. "Our recent acquisition of Alliance and our consistent ability to generate organic loan growth are key drivers of these results that demonstrate our combined focus on banking fundamentals and disciplined, strategic acquisition are yielding positive results. We continue to operate in an environment that presents both economic and regulatory challenges, but our seasoned team of financial professionals remains focused on delivering long-term value to our shareholders and customers."

Net interest income was $61.7 million for the three months ended June 30, 2013, up 18.2% from the prior quarter. This increase was due primarily to the 16.5% increase in average earning assets and a stable net interest margin. The increase in earnings assets in the second quarter 2013 compared to the prior quarter resulted primarily from the acquisition of Alliance combined with strong loan growth during the second quarter of 2013.   

The Company's Federal Taxable Equivalent ("FTE") net interest margin was 3.69% for the three months ended June 30, 2013, up slightly from 3.68% from the prior quarter. Rate compression on earning assets continued to negatively impact net interest margin in the second quarter of 2013 as evidenced by decreasing loan yields from 4.87% for the first quarter of 2013 to 4.76% for the second quarter of 2013. In addition, yields on available for sale securities declined 12 basis points ("bp") in the second quarter of 2013 from the prior quarter due primarily to the reinvestment of cash flows from maturing securities into lower yielding securities in the current rate environment.  The rate compression on earning assets was offset by the 14 bp decrease in the rates paid on interest bearing liabilities in the second quarter of 2013 versus the previous quarter. This decrease was primarily driven by decreases in rates paid on interest bearing deposits, most notably time deposits, as well as a reduction in the cost of long term borrowings as maturing higher cost borrowings were replaced with lower rate short term borrowings during the period. 

Net interest income was $113.8 million for the six months ended June 30, 2013, up 14.8% from the same period in 2012. This increase from the previous year was due primarily to the 20.1% increase in average earning assets for the six months ended June 30, 2013 over the prior year. The acquisition of Alliance in March 2013 as well as strong loan growth during the second quarter of 2013 contributed to the growth in average earning assets. 

The Company's FTE net interest margin was 3.68% for the six months ended June 30, 2013, down from 3.86% for the same period last year. Rate compression on earning assets continued to negatively impact net interest margin for the first six months of 2013 as evidenced by decreasing loan yields from 5.25% for the first six months of 2012 to 4.81% for the first six months of 2013. In addition, yields on available for sale securities declined 54 bp in the first six months of 2013 as compared to the same period in 2012.  The rate compression on earning assets was partially offset by the 22 bp decrease in the rates paid on interest bearing liabilities in the first six months of 2013 as compared to the same period in 2012.

Noninterest income for the three months ended June 30, 2013 was $25.5 million, up 1.2% from the prior quarter. Substantial increases in trust revenue (up $1.8 million) and ATM and debit card fees (up $0.8 million) for the second quarter of 2013 versus the prior quarter were primarily driven by the acquisition of Alliance. These increases were partially offset by a 16.5% decrease in insurance and other financial services revenue from the previous quarter, due primarily to insurance contingent revenue recorded during the first quarter.   

Noninterest income for the six months ended June 30, 2013 was $50.8 million, up 16.1% from the same period in 2012, with the primary drivers being the aforementioned increases in trust revenue and ATM and debit card fees. In addition, the Company experienced a significant increase (10.6%) in insurance and financial services revenue for the six months ended June 30, 2013 as compared to the same period in 2012, due primarily to an increase in insurance contingent revenue in 2013. Retirement plan administration fees were also up 18.9% for the six months ended June 30, 2013 as compared to the same period in 2012 due to growth in new business of 2012.

Noninterest expense for the three months ended June 30, 2013 was $56.5 million, down $4.3 million or 7.0%, from the prior quarter.  Excluding merger expenses totaling $1.3 million and $10.7 million during the second quarter and first quarter of 2013, respectively, noninterest expense was up $5.2 million, or 10.3%, for the second quarter of 2013 as compared to the prior quarter. Salaries and employee benefits were up 7.8% for the three months ended June 30, 2013 as compared to the prior quarter due primarily to the acquisition of Alliance. Income tax expense for the three month period ended June 30, 2013 was $7.4 million, up from $3.4 million from the previous quarter due to the increase in pre-tax income during the second quarter.  The effective tax rate was 30.5% for the first and second quarters of 2013.

Noninterest expense for the six months ended June 30, 2013 was $117.2 million, up $21.3 million or 22.2%, from the same period in 2012.  Excluding merger expenses totaling $12.0 million and $1.3 million for the six months ended June 30, 2013 and 2012, respectively, noninterest expense was up $10.7 million, or 11.3%, for the first six months of 2013 as compared to the same period in 2012. Several noninterest expense categories were affected by the acquisition of Alliance and Hampshire First Bank with salaries and employee benefits and occupancy expenses being the primary drivers of the increase over last year. Income tax expense for the six months ended June 30, 2013 was $10.8 million, down from $11.5 million from the same period in 2012 due to the decrease in pre-tax income for the first six months of 2013, offset slightly by the increase in the effective tax rate to 30.5% for the six months ended June 30, 2013 as compared with 30.0% for the same period last year.

Asset Quality

The Company recorded a provision for loan losses of $6.4 million for the three months ended June 30, 2013, compared with $5.7 million for the previous quarter. This increase was due primarily to a $1.4 million specific reserve established on a commercial real estate loan during the second quarter and loan growth during the period, partially offset by a general improvement in asset quality indicators.  Net charge-offs were $4.0 million for the three months ended June 30, 2013, down from $6.3 million for the previous quarter, due primarily to the first quarter charge-off of one large commercial loan that was previously reserved for. Annualized net charge-offs to average loans for the three months ended June 30, 2013 was 0.30%, compared to 0.56% for the previous quarter.

The Company recorded a provision for loan losses of $12.1 million for the six months ended June 30, 2013, compared with $8.6 million for the same period in 2012. This increase was due primarily to the aforementioned specific reserve in the second quarter of 2013 and organic loan growth during the period, partially offset by a general improvement in asset quality indicators. Net charge-offs were $10.2 million for the six months ended June 30, 2013, up from $9.2 million from the same period in 2012 due primarily to the 2013 first quarter charge-off of one large commercial loan that was previously reserved for. Annualized net charge-offs to average loans for the six months ended June 30, 2013 was 0.42%, compared to 0.48% for the same period last year.

Nonperforming loans to total loans improved to 0.80% at June 30, 2013, down 3 bps from the prior quarter, and down from 0.98% at December 31, 2012. Past due loans as a percentage of total loans was 0.71% at June 30, 2013, down from 0.81% at March 31, 2013.    

The allowance for loan losses totaled $71.2 million at June 30, 2013, compared to $68.7 million at March 31, 2013 and $69.3 million at December 31, 2012. The allowance for loan losses as a percentage of loans was 1.35% (1.68% excluding acquired loans with no related allowance recorded) at June 30, 2013, compared to 1.32% (1.69% excluding acquired loans with no related allowance recorded) at March 31, 2013 and 1.62% (1.72% excluding acquired loans with no related allowance recorded) at December 31, 2012.     

Balance Sheet

Total assets were $7.5 billion at June 30, 2013, up $1.5 billion (approximately $1.4 billion from Alliance acquisition) or 24.7% from December 31, 2012.  Loans were $5.3 billion at June 30, 2013, up $1.0 billion from December 31, 2012, primarily due to approximately $904 million from the Alliance acquisition coupled with strong organic loan growth during the second quarter of 2013.  Total deposits were $5.9 billion at June 30, 2013, up $1.1 billion from December 31, 2012, primarily due to the Alliance acquisition.  Stockholders' equity was $791.6 million, representing a total equity-to-total assets ratio of 10.51% at June 30, 2013, compared with $582.3 million or a total equity-to-total assets ratio of 9.64% at December 31, 2012.

Stock Repurchase Program

Under a previously disclosed stock repurchase plan, the Company purchased 267,425 shares of its common stock during the six month period ended June 30, 2013, for a total of $5.5 million at an average price of $20.42 per share. At June 30, 2013, there were 480,588 shares available for repurchase under this repurchase plan, which expires on December 31, 2013.

On July 22, 2013, the NBT Board of Directors authorized a new repurchase program for NBT to repurchase up to an additional 1,000,000 shares (approximately 2%) of its outstanding common stock, effective July 24, 2013, as market conditions warrant in open market and privately negotiated transactions. This plan expires on December 31, 2014.

Dividend

The NBT Board of Directors declared a 2013 third-quarter cash dividend of $0.20 per share at a meeting held today. The dividend will be paid on September 15, 2013 to shareholders of record as of September 1, 2013.

Corporate Overview

NBT Bancorp Inc. is a financial holding company headquartered in Norwich, N.Y., with total assets of $7.5 billion at June 30, 2013.  The company primarily operates through NBT Bank, N.A., a full-service community bank with three geographic divisions, and through two financial services companies.  NBT Bank, N.A. has 161 locations, including 121 NBT Bank offices in upstate New York, northwestern Vermont and western Massachusetts, 35 Pennstar Bank offices in northeastern Pennsylvania, and 5 Hampshire First Bank offices in southern New Hampshire. EPIC Advisors, Inc., based in Rochester, N.Y., is a full-service 401(k) plan recordkeeping firm. Mang Insurance Agency, LLC, based in Norwich, N.Y., is a full-service insurance agency. More information about NBT and its divisions can be found on the Internet at: www.nbtbancorp.com, www.nbtbank.com, www.pennstarbank.com, www.hampshirefirst.com, www.epic1st.com and www.manginsurance.com.

Forward-Looking Statements

This news release contains forward-looking statements. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of the management of NBT Bancorp and its subsidiaries and on the information available to management at the time that these statements were made. There are a number of factors, many of which are beyond NBT's control, that could cause actual conditions, events or results to differ significantly from those described in 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) competitive pressures among depository and other financial institutions may increase significantly; (2) revenues may be lower than expected; (3) changes in the interest rate environment may reduce interest margins; (4) general economic conditions, either nationally or regionally, may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and/or a reduced demand for credit; (5) legislative or regulatory changes, including changes in accounting standards and tax laws, may adversely affect the businesses in which NBT is engaged; (6) competitors may have greater financial resources and develop products that enable such competitors to compete more successfully than NBT; (7) adverse changes may occur in the securities markets or with respect to inflation; (8) operating costs, customer losses and business disruption following the recently completed acquisition of alliance, including adverse effects of relationships with employees, may be greater than expected; and (9) the risk that the anticipated benefits, costs savings and any other savings from the merger may not be fully realized or may take longer than expected to realize.  Forward-looking statements speak only as of the date they are made. Except as required by law, NBT does not update forward-looking statements to reflect subsequent circumstances or events.

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). These measures adjust GAAP measures to exclude the effects of sales of securities and certain non-recurring and merger-related expenses. 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 provided useful information that is important to an understanding of the operating results of NBT's core business (due to the non-recurring nature of the excluded items). 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.

NBT Bancorp Inc. and Subsidiaries          
SELECTED FINANCIAL DATA          
(unaudited, dollars in thousands except per share data)          
     
  2013 2012
  2nd Q 1st Q 4th Q 3rd Q 2nd Q
Reconciliation of Non-GAAP Financial Measures:          
Reported net income (GAAP) $16,916 $7,649 $13,116 $14,535 $13,257
Adj: Loss / (Gain) on sale of securities, net 61 (1,145) (21) (26) (97)
Adj: Other adjustments (1)  --   --   --  (792) (115)
Plus: Merger related expenses 1,269 10,681 713 558 826
Total Adjustments 1,330 9,536 692 (260) 614
Income tax effect on adjustments (406) (2,908) (211) 79 (187)
Core net income $17,840 $14,277 $13,597 $14,354 $13,684
           
Profitability:          
Core Diluted Earnings Per Share $0.40 $0.39 $0.40 $0.42 $0.41
Diluted Earnings Per Share $0.38 $0.21 $0.39 $0.43 $0.40
Weighted Average Diluted           
Common Shares Outstanding 44,316,531 36,794,356 33,987,465 33,961,375 33,492,659
Core Return on Average Assets (2) 0.95% 0.90% 0.89% 0.96% 0.95%
Return on Average Assets (2) 0.90% 0.48% 0.86% 0.97% 0.92%
Core Return on Average Equity (2) 8.88% 9.01% 9.34% 10.00% 9.97%
Return on Average Equity (2) 8.42% 4.83% 9.01% 10.13% 9.66%
Core Return on Average Tangible Common Equity (2)(4) 14.57% 13.58% 13.71% 14.74% 14.35%
Return on Average Tangible Common Equity (2)(4) 13.85% 7.49% 13.25% 14.93% 13.92%
Net Interest Margin (3) 3.69% 3.68% 3.83% 3.90% 3.82%
           
Six Months Ended June 30,          
           
           
Reconciliation of Non-GAAP Financial Measures: 2013 2012      
Reported net income (GAAP) $24,565 $26,907      
Adj: Loss / (Gain) on sale of securities, net (1,084) (552)      
Adj: Other adjustments (5)  --  (865)      
Plus: Merger related expenses 11,950 1,337      
Total Adjustments 10,866 (80)      
Income tax effect on adjustments (3,314) 24      
Core net income $32,117 $26,851      
           
Profitability:          
Core Diluted Earnings Per Share $0.79 $0.80      
Diluted Earnings Per Share $0.61 $0.80      
Weighted Average Diluted           
Common Shares Outstanding 40,574,934 33,452,970      
Core Return on Average Assets (2) 0.93% 0.94%      
Return on Average Assets (2) 0.71% 0.94%      
Core Return on Average Equity (2) 8.93% 9.86%      
Return on Average Equity (2) 6.83% 9.89%      
Core Return on Average Tangible Common Equity (2)(4) 14.11% 14.18%      
Return on Average Tangible Common Equity (2)(4) 10.93% 14.21%      
Net Interest Margin (3) 3.68% 3.86%      
           
(1) Other adjustments were primarily flood insurance recoveries        
(2) Annualized          
(3) Calculated on a FTE basis          
(4) Excludes amortization of intangible assets (net of tax) from net income and average tangible common equity is calculated as follows:
           
Average stockholders' equity  $ 806,200  $ 642,693  $ 579,211  $ 570,880  $ 551,865
Less: average goodwill and other intangibles  292,775  200,779  169,612  169,445  154,058
Average tangible common equity  $ 513,425  $ 441,914  $ 409,599  $ 401,435  $ 397,807
           
(5) Other adjustments for the six months ended June 30, 2012 were a $750 prepayment penalty fee and a flood insurance recovery
           
NBT Bancorp Inc. and Subsidiaries          
SELECTED FINANCIAL DATA          
(unaudited, dollars in thousands except per share data)          
           
     
  2013 2012
  2nd Q 1st Q 4th Q 3rd Q 2nd Q
Balance Sheet Data:          
Securities Available for Sale $1,390,403 $1,465,791 $1,147,999 $1,191,107 $1,221,706
Securities Held to Maturity  122,302  62,474  60,563  61,302  64,387
Net Loans  5,219,526  5,126,299  4,208,282  4,180,385  4,090,480
Total Assets  7,534,518  7,610,831  6,042,259  6,028,916  5,967,568
Total Deposits  5,878,176  6,015,963  4,784,349  4,806,015  4,688,907
Total Borrowings  795,918  715,728  605,855  579,931  654,772
Total Liabilities  6,742,943  6,807,536  5,459,986  5,452,255  5,401,063
Stockholders' Equity  791,575  803,295  582,273  576,661  566,505
           
Asset Quality:          
Nonaccrual Loans $40,525 $41,726 $39,676 $42,661 $43,924
90 Days Past Due and Still Accruing  2,004  1,651  2,448  2,963  1,629
Total Nonperforming Loans  42,529  43,377  42,124  45,624  45,553
Other Real Estate Owned  3,757  2,864  2,276  1,863  1,815
Total Nonperforming Assets  46,286  46,241  44,400  47,487  47,368
Allowance for Loan Losses  71,184  68,734  69,334  70,734  70,734
Allowance for Loan Losses to Total Originated Loans (6) 1.68% 1.69% 1.72% 1.77% 1.81%
Allowance for Loan Losses to Total Loans 1.35% 1.32% 1.62% 1.66% 1.70%
Total Nonperforming Loans to Total Loans 0.80% 0.83% 0.98% 1.07% 1.09%
Total Nonperforming Assets to Total Assets 0.61% 0.61% 0.73% 0.79% 0.79%
Past Due Loans to Total Loans 0.71% 0.81% 0.71% 0.65% 0.54%
Allowance for Loan Losses to Total Nonperforming Loans 167.38% 158.46% 164.60% 155.04% 155.28%
Net Charge-Offs to Average Loans (2) 0.30% 0.56% 0.78% 0.45% 0.48%
           
Capital:          
Equity to Assets 10.51% 10.55% 9.64% 9.56% 9.49%
Book Value Per Share $18.18 $18.36 $17.24 $17.09 $16.79
Tangible Book Value Per Share (7) $11.46 $11.67 $12.23 $12.06 $11.76
Tier 1 Leverage Ratio (8) 8.72% 10.25% 8.54% 8.51% 8.59%
Tier 1 Capital Ratio 11.20% 11.33% 11.00% 10.82% 10.78%
Total Risk-Based Capital Ratio 12.45% 12.58% 12.25% 12.07% 12.03%
Common Stock Price (End of Period)  $ 21.17  $ 22.15  $ 20.27  $ 22.07  $ 21.59
           
(6) Excludes acquired loans with no related allowance recorded        
(7) Stockholders' equity less goodwill and intangible assets divided by common shares outstanding    
(8) The Tier 1 Leverage Ratio for the first quarter of 2013 was impacted by timing of the acquisition of Alliance on March 8, 2013
           
Note: Year-to-date (YTD) EPS may not equal sum of quarters due to share count differences.    
     
NBT Bancorp Inc. and Subsidiaries     
CONSOLIDATED BALANCE SHEETS    
(unaudited, dollars in thousands)    
     
ASSETS June 30,
2013
December 31,
2012
Cash and due from banks  $ 142,570  $ 157,094
Short term interest bearing accounts  1,117  6,574
Securities available for sale, at fair value   1,390,403  1,147,999
Securities held to maturity fair value of $121,069 and $61,535 at June 30, 2013 and December 31, 2012, respectively)  122,302  60,563
Trading securities  5,092  3,918
Federal Reserve and Federal Home Loan Bank stock  43,491  29,920
Loans  5,290,710  4,277,616
Less allowance for loan losses  71,184  69,334
Net loans  5,219,526 4,208,282
Premises and equipment, net  87,811  77,875
Goodwill  264,376  152,373
Intangible assets, net  28,204  16,962
Bank owned life insurance  112,907  80,702
Other assets  116,719  99,997
TOTAL ASSETS  $ 7,534,518  $ 6,042,259
     
LIABILITIES AND STOCKHOLDERS' EQUITY    
Deposits:    
Demand (noninterest bearing)  $ 1,516,385  $ 1,242,712
Savings, NOW, and money market  3,256,753  2,558,376
Time  1,105,038  983,261
Total deposits 5,878,176 4,784,349
Short-term borrowings  385,611  162,941
Long-term debt  309,111  367,492
Trust preferred debentures  101,196  75,422
Other liabilities  68,849  69,782
Total liabilities 6,742,943 5,459,986
     
Total stockholders' equity  791,575  582,273
     
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY  $ 7,534,518  $ 6,042,259
         
NBT Bancorp Inc. and Subsidiaries         
CONSOLIDATED STATEMENTS OF INCOME        
(unaudited, dollars in thousands except per share data)      
         
     
   Three Months Ended
June 30,
 Six Months Ended
June 30,
  2013 2012 2013 2012
Interest, fee and dividend income:        
Loans  $ 62,031  $ 50,509  $ 115,726  $ 100,717
Securities available for sale 6,537  7,108  12,283  14,474
Securities held to maturity 548  617  1,073  1,257
Other 488  413  891  805
Total interest, fee and dividend income  69,604  58,647  129,973  117,253
Interest expense:        
Deposits 4,296  4,834  8,446  9,977
Short-term borrowings 67  48  109  89
Long-term debt 3,026  3,580  6,635  7,161
Trust preferred debentures 560  434  988  883
Total interest expense  7,949  8,896  16,178  18,110
Net interest income  61,655  49,751  113,795  99,143
Provision for loan losses 6,402  4,103  12,060  8,574
Net interest income after provision for loan losses  55,253  45,648  101,735  90,569
Noninterest income:        
Insurance and other financial services revenue 5,755  5,279  12,648  11,433
Service charges on deposit accounts 4,933  4,571  9,256  8,912
ATM and debit card fees 4,044  3,063  7,286  6,025
Retirement plan administration fees 2,957  2,411  5,639  4,744
Trust 4,699  2,312  7,612  4,441
Bank owned life insurance income 886  618  1,735  1,589
Net securities (losses) gains (61)  97  1,084  552
Other 2,324  2,331  5,506  6,042
Total noninterest income  25,537  20,682  50,766  43,738
Noninterest expense:        
Salaries and employee benefits 29,160  24,992  56,207  51,717
Occupancy 5,219  4,222  10,196  8,713
Data processing and communications 3,854  3,431  7,309  6,689
Professional fees and outside services 3,237  2,388  6,138  5,113
Equipment 2,910  2,409  5,492  4,789
Office supplies and postage 1,656  1,574  3,246  3,245
FDIC expenses  1,273  942  2,403  1,873
Advertising  1,000  805  1,723  1,607
Amortization of intangible assets 1,351  841  2,202  1,660
Loan collection and other real estate owned 421  799  1,139  1,437
Merger related  1,269  826  11,950  1,337
Other operating 5,100  4,161  9,150  7,684
Total noninterest expense 56,450 47,390 117,155 95,864
Income before income taxes 24,340 18,940 35,346 38,443
Income taxes 7,424  5,683  10,781  11,536
Net income  $ 16,916  $ 13,257  $ 24,565  $ 26,907
Earnings Per Share:        
Basic  $ 0.39  $ 0.40  $ 0.61  $ 0.81
Diluted  $ 0.38  $ 0.40  $ 0.61  $ 0.80
         
Note: Year-to-date (YTD) EPS may not equal sum of quarters due to share count differences.  
           
NBT Bancorp Inc. and Subsidiaries          
QUARTERLY CONSOLIDATED STATEMENTS OF INCOME          
(unaudited, dollars in thousands except per share data)          
           
       
  2013 2012  
  2nd Q 1st Q 4th Q 3rd Q 2nd Q
Interest, fee and dividend income:          
Loans  $ 62,031  $ 53,695  $ 53,924  $ 53,817  $ 50,509
Securities available for sale 6,537 5,746 5,981 6,550 7,108
Securities held to maturity 548 525 549 572 617
Other 488 403 403 348 413
Total interest, fee and dividend income 69,604 60,369 60,857 61,287 58,647
Interest expense:          
Deposits 4,296 4,150 4,327 4,544 4,834
Short-term borrowings 67 42 39 60 48
Long-term debt 3,026 3,609 3,627 3,640 3,580
Trust preferred debentures 560 428 411 436 434
Total interest expense 7,949 8,229 8,404 8,680 8,896
Net interest income 61,655 52,140 52,453 52,607 49,751
Provision for loan losses 6,402 5,658 6,940 4,755 4,103
Net interest income after provision for loan losses 55,253 46,482 45,513 47,852 45,648
Noninterest income:          
Insurance and other financial services revenue 5,755 6,893 5,363 5,591 5,279
Service charges on deposit accounts 4,933 4,323 4,687 4,626 4,571
ATM and debit card fees 4,044 3,242 2,955 3,378 3,063
Retirement plan administration fees 2,957 2,682 2,635 2,718 2,411
Trust  4,699 2,913 2,489 2,242 2,312
Bank owned life insurance income 886 849 849 639 618
Net securities (losses) gains (61) 1,145 21 26 97
Other 2,324 3,182 2,963 2,407 2,331
Total noninterest income 25,537 25,229 21,962 21,627 20,682
Noninterest expense:          
Salaries and employee benefits 29,160 27,047 26,457 26,641 24,992
Occupancy 5,219 4,977 4,265 4,437 4,222
Data processing and communications 3,854 3,455 3,396 3,352 3,431
Professional fees and outside services 3,237 2,901 2,615 2,735 2,388
Equipment 2,910 2,582 2,403 2,435 2,409
Office supplies and postage 1,656 1,590 1,647 1,597 1,574
FDIC expenses 1,273 1,130 1,020 939 942
Advertising 1,000 723 581 701 805
Amortization of intangible assets 1,351 851 864 870 841
Loan collection and other real estate owned 421 718 509 614 799
Merger 1,269 10,681 713 558 826
Other operating 5,100 4,050 4,122 4,552 4,161
Total noninterest expense 56,450 60,705 48,592 49,431 47,390
Income before income taxes 24,340 11,006 18,883 20,048 18,940
Income taxes 7,424 3,357 5,767 5,513 5,683
Net income   $ 16,916  $ 7,649  $ 13,116  $ 14,535  $ 13,257
Earnings per share:          
Basic  $ 0.39  $ 0.21  $ 0.39  $ 0.43  $ 0.40
Diluted  $ 0.38  $ 0.21  $ 0.39  $ 0.43  $ 0.40
           
Note: Year-to-date (YTD) EPS may not equal sum of quarters due to share count differences.      
                     
NBT Bancorp Inc. and Subsidiaries                    
AVERAGE 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
  Q2 - 2013 Q1 - 2013 Q4 - 2012 Q3 - 2012 Q2 - 2012
ASSETS:                    
Short-term interest bearing accounts  $ 41,313 0.57%  $ 75,110 0.21%  $ 72,660 0.26%  $ 10,392 0.43%  $ 102,192 0.33%
Securities available for sale (1)(2)  1,428,864 1.97%  1,197,238 2.09%  1,123,110 2.27%  1,168,326 2.39%  1,208,384 2.53%
Securities held to maturity (1)   62,463 5.23%  52,905 6.06%  60,651 5.42%  62,746 5.46%  68,472 5.47%
Investment in FRB and FHLB Banks  35,497 4.85%  31,312 4.75%  29,801 4.75%  28,706 4.67%  27,886 4.73%
Loans and leases (3)  5,243,534 4.76%  4,492,106 4.87%  4,264,680 5.05%  4,197,046 5.12%  3,938,592 5.18%
Total interest earning assets  $ 6,811,671 4.16%  $ 5,848,671 4.25%  $ 5,550,902 4.43%  $ 5,467,216 4.53%  $ 5,345,526 4.49%
Other assets  705,869    554,355    503,124    504,194    465,058  
Total assets  $ 7,517,540    $ 6,403,026    $ 6,054,026    $ 5,971,410    $ 5,810,584  
                     
LIABILITIES AND STOCKHOLDERS' EQUITY:                    
Money market deposit accounts $1,402,429 0.15% $1,190,555 0.14% $1,149,248 0.14% $1,111,624 0.18% $1,115,812 0.19%
NOW deposit accounts  927,037 0.19%  799,219 0.23%  752,737 0.25%  686,768 0.22%  704,896 0.27%
Savings deposits  983,413 0.09%  770,559 0.08%  694,226 0.08%  706,927 0.08%  676,794 0.08%
Time deposits  1,136,511 1.10%  1,015,711 1.26%  1,006,581 1.31%  1,035,868 1.35%  973,051 1.52%
Total interest bearing deposits  $ 4,449,390 0.39%  $ 3,776,044 0.45%  $ 3,602,792 0.48%  $ 3,541,187 0.51%  $ 3,470,553 0.56%
Short-term borrowings  229,906 0.12%  168,783 0.10%  150,372 0.10%  178,277 0.13%  171,545 0.11%
Trust preferred debentures  101,196 2.22%  82,295 2.11%  75,422 2.17%  75,422 2.30%  75,422 2.31%
Long-term debt  355,702 3.41%  382,177 3.83%  367,312 3.93%  367,146 3.94%  368,251 3.91%
Total interest bearing liabilities  $ 5,136,194 0.62%  $ 4,409,299 0.76%  $ 4,195,898 0.80%  $ 4,162,032 0.83%  $ 4,085,771 0.88%
Demand deposits  1,496,486    1,283,737    1,210,440    1,173,638    1,111,804  
Other liabilities  78,660    67,297    68,477    64,860    61,144  
Stockholders' equity  806,200    642,693    579,211    570,880    551,865  
Total liabilities and stockholders' equity  $ 7,517,540    $ 6,403,026    $ 6,054,026    $ 5,971,410    $ 5,810,584  
                     
Interest rate spread   3.54%   3.49%   3.63%   3.70%   3.61%
Net interest margin   3.69%   3.68%   3.83%   3.90%   3.82%
                     
(1) Securities are shown at average amortized cost                    
(2) Excluding unrealized gains or losses                    
(3) For purposes of these computations, nonaccrual loans are included in the average loan balances outstanding            
             
NBT Bancorp Inc. and Subsidiaries            
CONSOLIDATED LOAN BALANCES            
(unaudited, dollars in thousands)            
       
      2013
  2013 2012 Acquired 
  2nd Q 1st Q 4th Q 3rd Q 2nd Q Balances *
Residential real estate mortgages  $1,001,642  $ 996,925  $ 651,107  $ 650,448  $ 630,791  $ 333,105
Commercial  867,513  829,766  694,799  697,213  691,055  179,672
Commercial real estate mortgages  1,241,271  1,233,763  1,072,807  1,083,675  1,066,039  117,752
Real estate construction and development  152,548  136,402  123,078  99,181  99,236  -- 
Agricultural and agricultural real estate mortgages  107,565  107,023  112,687  112,822  107,337  -- 
Consumer  1,284,888  1,253,645  1,047,856  1,031,572  993,586  200,470
Home equity  635,283  637,509  575,282  576,208  573,170  73,474
Total loans  $5,290,710  $5,195,033  $4,277,616  $4,251,119  $4,161,214  $ 904,473
             
* Balances are as of Alliance acquisition date of March 8, 2013          
CONTACT: Martin A. Dietrich, CEO
         Michael J. Chewens, CFO
         NBT Bancorp Inc.
         52 South Broad Street
         Norwich, NY 13815
         607-337-6119
Source: NBT Bancorp Inc.
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