Exhibit 99(a)
 |
News Release
|
5 Sarnowski Drive, Glenville, New York, 12302
(518) 377-3311 Fax: (518) 381-3668
|
Subsidiary:
|
TrustCo Bank
|
NASDAQ -- TRST
|
|
Contact:
|
Robert Leonard
|
|
Executive Vice President and
|
|
|
Chief Risk Officer
|
|
|
(518) 381-3693
|
FOR IMMEDIATE RELEASE:
TrustCo is Pleased to Report First Quarter 2019 Results;
Net Income of $14.6 Million and 6.0% Average Loan Growth Year over Year
Glenville, New York – April 22, 2019
TrustCo Bank Corp NY (TrustCo, NASDAQ: TRST) today announced first quarter 2019 net income of $14.6 million or $0.150 diluted earnings per share compared to $14.8 million or $0.153 diluted earnings per share in the
first quarter of 2018.
Summary
Robert J. McCormick, Chairman, President and Chief Executive Officer noted, “We are pleased to start 2019 off with continued strong net income
for the first quarter 2019 as compared to the first quarter 2018. Our focus on traditional lending criteria and conservative balance sheet management has enabled us to produce consistent earnings, maintain strong liquidity and capital. This
approach has allowed us to continue to grow our business to a new total asset record surpassing the $5 billion milestone and take advantage of changes in market and competitive conditions. The increased earnings during 2018 has provided TrustCo
the opportunity in early 2019 to invest in future earning assets and build additional liquidity. As we enter our busiest season for residential lending the Bank is well positioned to take advantage of our cash position and deploy this existing
liquidity into our residential loan portfolio. Using this approach we will continue to seize opportunities as they arise during the coming year and beyond.”
TrustCo saw average loans grow 6.0% in the first quarter of 2019 compared to the first quarter of 2018. Year over year, loan portfolio expansion
was funded by a combination of utilizing a portion of our strong cash balances, cash flow from investments, and the growth in funding from customer deposits. The continued shift in earning assets toward higher yielding loans has helped to manage
margin compression driven by the higher cost of funds. Total average deposits are up $156.6 million or 3.8% in the first quarter 2019 compared to the prior year. Nationally, including the markets we serve, customers have looked to move funds to
higher yielding time deposits. We chose to offer competitive shorter term rates which allowed the Bank to gain market share as well as retain our existing time deposits. This strategy drove growth at a relatively low cost that will sustain
TrustCo’s strong liquidity position and continue to allow us to cross sell new relationships and take advantage of opportunities as they arise.
Page | 1
Details
Average loans were up $217.8 million or 6.0% in the first quarter 2019 over the same period in 2018. Average residential loans, our primary
lending focus, were up $226.3 million or 7.2% in the first quarter 2019, over the same period in 2018. Average deposits are up $156.6 million or 3.8% for the first quarter 2019 over the same period a year earlier. The increase in deposits was the
result of a $272.3 million or 25.2% increase in average time deposits versus prior year. Excluding time deposits, total average core deposit accounts, which consist of checking, savings and money market deposits, were down $115.7 million or 3.8%
for the first quarter 2019 compared to the first quarter 2018. Within core, checking balances were up $13.7 million (including interest bearing and non‑interest bearing balances).
The Federal Open Market Committee (FOMC) increased short term rates 100 basis points from March 2018 to March 2019 while the cost of our interest
bearing liabilities increased only 35 basis points over the same period. The cost of interest bearing liabilities increased to 0.77% in the first quarter 2019 from 0.42% in the first quarter 2018. The cost of core deposits remained relatively
flat over the same time frame. A significant portion of our CD portfolio repriced during the first quarter of 2019 with some additional still to reprice in second quarter. The net interest margin for the first quarter 2019 was 3.24%, down only 5
basis points from 3.29% in the first quarter of 2018. However, net interest income (TE) still increased by 1.05% or $414 thousand versus the same period last year. Our growth in deposits came at a comparably low cost and continue to be offset by
higher earnings on cash reserves, increased loan yields and returns in the investment portfolio. Because we offered competitive shorter term rates, we would expect margin to begin to stabilize in the later part of 2019 particularly in third and
fourth quarter as our shorter term time deposits could reprice lower and provide opportunity for increased margin expansion.
The Bank continued to demonstrate its ability to grow shareholders’ equity as average equity was up $35.4 million or 7.7% in the first quarter of
2019 compared to the same period in 2018. On this expanded equity, return on average assets and return on average equity for the first quarter 2019 were 1.17% and 11.93%, respectively, compared to 1.23% and 13.07% for the first quarter 2018.
Overall expense control remains a key area of focus. Total operating expenses increased by $712 thousand or 2.9% in the first quarter 2019 as compared to the first quarter 2018, driven by salaries and employee benefits, largely offset by declines
in FDIC Insurance and ORE Expenses, net. The growth in salaries and benefit expense was the result of our targeted effort to hire and expand certain functions which has now been largely completed.
Page | 2
Asset quality and loan loss reserve measures continued to improve. Nonperforming loans (NPLs) were $24.7 million at March 31, 2019, compared to
$24.9 million at March 31, 2018. NPLs were equal to 0.64% of total loans at March 31, 2019, compared to 0.68% at March 31, 2018. The coverage ratio, or allowance for loan losses to NPLs, was 180.5% at March 31, 2019, compared to 178.6% at March
31, 2018. Nonperforming assets (NPAs) were $26.0 million at March 31, 2019 compared to $27.0 million at March 31, 2018. The ratio of allowance for loan losses to total loans was 1.16% as of March 31, 2019, compared to 1.21% at March 31, 2018
which reflects both the improvement in asset quality and economic conditions in our lending areas. The allowance for loan losses was $44.7 million at March 31, 2019 compared to $44.4 million at March 31, 2018. The provision for loan losses
remained nominal which continued to reflect the strong credit performance within the loan portfolio. Net chargeoffs for the first quarter 2019 increased versus the first quarter 2018, at $395 thousand from $90 thousand in the year earlier period
driven by a non performing loan sale. The annualized net chargeoff ratio was 0.04% for the first quarter 2019, compared to 0.01% in the first quarter 2018.
At March 31, 2019 the equity to asset ratio was 9.73%, compared to 9.37% at March 31, 2018. As mentioned earlier the Bank is proud of its ability
to grow shareholder value. Book value per share at March 31, 2019 was $5.18 up 7.92% compared to $4.80 a year earlier.
TrustCo Bank Corp NY is a $5.2 billion savings and loan holding company and through its subsidiary, TrustCo Bank, operated 148 offices in New
York, New Jersey, Vermont, Massachusetts, and Florida at March 31, 2019.
In addition, the Bank’s Financial Services Department offers a full range of investment services, retirement planning and trust and estate
administration services. The common shares of TrustCo are traded on the NASDAQ Global Select Market under the symbol TRST.
A conference call to discuss first quarter 2019 results will be held at 9:00 a.m. Eastern Time on April
23, 2019. Those wishing to participate in the call may dial toll-free 1-888-339-0764. International callers must dial 1-412-902-4195. Please ask to be joined into the TrustCo Bank Corp NY / TRST call. A replay of the call will be available for thirty days by dialing 1-877-344-7529 (1-412-317-0088 for international callers), Conference
Number 10130170. The call will also be audio
webcast at: https://services.choruscall.com/links/trst190429.html, and will be available for one year.
Page | 3
Safe Harbor Statement
All statements in this news release that are not historical are forward-looking statements within the meaning of the Securities Exchange Act of
1934, as amended. Forward-looking statements can be identified by words such as "anticipate," "intend," "plan," "goal," "seek," "believe," "project," "estimate," "expect," "strategy," "future," "likely," "may," "should," "will" and similar
references to future periods. Examples of forward-looking statements include, among others, statements we make regarding our expectations for our performance during 2018, the impact of Federal Reserve actions regarding interest rates and the growth
of loans and deposits throughout our branch network, our ability to capitalize on economic changes in the areas in which we operate and the extent to which higher expenses to fulfill operating and regulatory requirements recur or diminish over
time. Such forward-looking statements are subject to factors that could cause actual results to differ materially for TrustCo from those discussed. TrustCo wishes to caution readers not to place undue reliance on any such forward-looking
statements, which speak only as of the date made. The following important factors, among others, in some cases have affected and in the future could affect TrustCo’s actual results and could cause TrustCo’s actual financial performance to differ
materially from that expressed in any forward-looking statement: our ability to continue to originate a significant volume of one-to-four family mortgage loans in our market areas; our ability to continue to maintain noninterest expense and other
overhead costs at reasonable levels relative to income; our ability to comply with the supervisory agreement entered into with Trustco Bank’s regulator and potential regulatory actions if we fail to comply; restrictions or conditions imposed by our
regulators on our operations that may make it more difficult for us to achieve our goals; the future earnings and capital levels of Trustco Bank and the continued ability of Trustco Bank under regulatory rules and the supervisory agreement to
distribute capital to TrustCo, which could affect our ability to pay dividends; results of supervisory monitoring or examinations of Trustco Bank and TrustCo by our respective regulators; our ability to make accurate assumptions and judgments
regarding the credit risks associated with lending and investing activities; the effect of changes in financial services laws and regulations and the impact of other governmental initiatives affecting the financial services industry; the effects
of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board, inflation, interest rates, market and monetary fluctuations; adverse conditions on the securities markets that lead to
impairment in the value of securities in our investment portfolio; changes in law and policy accompanying the new presidential administration and uncertainty or speculation pending the enactment of such changes; the perceived overall value of our
products and services by users, including in comparison to competitors’ products and services and the willingness of current and prospective customers to substitute competitors’ products and services for our products and services; changes in
consumer spending, borrowing and saving habits; technological changes and electronic, cyber, and physical security breaches; real estate and collateral values; changes in accounting policies and practices, as may be adopted by the bank regulatory
agencies, the FASB or PCAOB; changes in local market areas and general business and economic trends, as well as changes in consumer spending and saving habits; our success at managing the risks involved in the foregoing and managing our business;
and other risks and uncertainties under the heading “Risk Factors” in our most recent annual report on Form 10-K and, if any, in our subsequent quarterly reports on Form 10-Q or other securities filings.
Page | 4
TRUSTCO BANK CORP NY
GLENVILLE, NY
FINANCIAL HIGHLIGHTS
(dollars in thousands, except per share data)
(Unaudited)
|
Three months ended
|
||||||||||||
|
3/31/2019
|
12/31/2018
|
3/31/2018
|
||||||||||
|
Summary of operations
|
||||||||||||
|
Net interest income (TE)
|
$
|
39,733
|
40,740
|
39,319
|
||||||||
|
Provision for loan losses
|
300
|
500
|
300
|
|||||||||
|
Noninterest income
|
4,637
|
4,452
|
4,679
|
|||||||||
|
Noninterest expense
|
24,867
|
24,919
|
24,155
|
|||||||||
|
Net income
|
14,558
|
16,033
|
14,808
|
|||||||||
|
Per common share
|
||||||||||||
|
Net income per share:
|
||||||||||||
|
- Basic
|
$
|
0.150
|
0.166
|
0.154
|
||||||||
|
- Diluted
|
0.150
|
0.166
|
0.153
|
|||||||||
|
Cash dividends
|
0.068
|
0.068
|
0.066
|
|||||||||
|
Book value at period end
|
5.18
|
5.06
|
4.80
|
|||||||||
|
Market price at period end
|
7.76
|
6.86
|
8.45
|
|||||||||
|
At period end
|
||||||||||||
|
Full time equivalent employees
|
899
|
854
|
827
|
|||||||||
|
Full service banking offices
|
148
|
148
|
145
|
|||||||||
|
Performance ratios
|
||||||||||||
|
Return on average assets
|
1.17
|
%
|
1.30
|
1.23
|
||||||||
|
Return on average equity
|
11.93
|
13.18
|
13.07
|
|||||||||
|
Efficiency (1)
|
56.10
|
55.06
|
54.05
|
|||||||||
|
Net interest spread (TE)
|
3.11
|
3.27
|
3.22
|
|||||||||
|
Net interest margin (TE)
|
3.24
|
3.38
|
3.29
|
|||||||||
|
Dividend payout ratio
|
45.23
|
41.07
|
42.70
|
|||||||||
|
Capital ratios at period end
|
||||||||||||
|
Consolidated tangible equity to tangible assets (2)
|
9.72
|
%
|
9.87
|
9.37
|
||||||||
|
Consolidated equity to assets
|
9.73
|
%
|
9.88
|
9.36
|
||||||||
|
Asset quality analysis at period end
|
||||||||||||
|
Nonperforming loans to total loans
|
0.64
|
0.64
|
0.68
|
|||||||||
|
Nonperforming assets to total assets
|
0.50
|
0.54
|
0.55
|
|||||||||
|
Allowance for loan losses to total loans
|
1.16
|
1.16
|
1.21
|
|||||||||
|
Coverage ratio (3)
|
1.8
|
x
|
1.8
|
x
|
1.8
|
x
|
||||||
| (1) |
Non-GAAP measure; calculated as noninterest expense (excluding ORE income/expense) divided by taxable equivalent net interest income plus noninterest income.
|
| (2) |
Non-GAAP measure; calculated as total equity less $553 of intangible assets divided by total assets less $553 of intangible assets.
|
| (3) |
Calculated as allowance for loan losses divided by total nonperforming loans.
|
TE = Taxable equivalent
Page | 5
CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except per share data)
(Unaudited)
|
Three months ended
|
||||||||||||||||||||
|
3/31/2019
|
12/31/2018
|
9/30/2018
|
6/30/2018
|
3/31/2018
|
||||||||||||||||
|
Interest and dividend income:
|
||||||||||||||||||||
|
Interest and fees on loans
|
$
|
41,253
|
41,184
|
40,073
|
38,956
|
38,091
|
||||||||||||||
|
Interest and dividends on securities available for sale:
|
||||||||||||||||||||
|
U. S. government sponsored enterprises
|
783
|
788
|
787
|
787
|
750
|
|||||||||||||||
|
State and political subdivisions
|
1
|
2
|
7
|
6
|
7
|
|||||||||||||||
|
Mortgage-backed securities and collateralized mortgage obligations - residential
|
1,555
|
1,554
|
1,601
|
1,675
|
1,763
|
|||||||||||||||
|
Corporate bonds
|
208
|
202
|
202
|
150
|
133
|
|||||||||||||||
|
Small Business Administration - guaranteed participation securities
|
297
|
329
|
325
|
333
|
352
|
|||||||||||||||
|
Mortgage-backed securities and collateralized mortgage obligations - commercial
|
-
|
-
|
-
|
(5
|
)
|
42
|
||||||||||||||
|
Other securities
|
5
|
5
|
4
|
4
|
5
|
|||||||||||||||
|
Total interest and dividends on securities available for sale
|
2,849
|
2,880
|
2,926
|
2,950
|
3,052
|
|||||||||||||||
|
Interest on held to maturity securities:
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Mortgage-backed securities and collateralized mortgage obligations - residential
|
217
|
226
|
232
|
244
|
260
|
|||||||||||||||
|
Total interest on held to maturity securities
|
217
|
226
|
232
|
244
|
260
|
|||||||||||||||
|
Federal Reserve Bank and Federal Home Loan Bank stock
|
85
|
207
|
82
|
198
|
77
|
|||||||||||||||
|
Interest on federal funds sold and other short-term investments
|
3,009
|
2,367
|
2,425
|
2,467
|
2,017
|
|||||||||||||||
|
Total interest income
|
47,413
|
46,864
|
45,738
|
44,815
|
43,497
|
|||||||||||||||
|
Interest expense:
|
||||||||||||||||||||
|
Interest on deposits:
|
||||||||||||||||||||
|
Interest-bearing checking
|
121
|
111
|
113
|
112
|
106
|
|||||||||||||||
|
Savings
|
377
|
401
|
417
|
420
|
419
|
|||||||||||||||
|
Money market deposit accounts
|
826
|
618
|
544
|
452
|
439
|
|||||||||||||||
|
Time deposits
|
5,976
|
4,643
|
3,864
|
3,439
|
2,860
|
|||||||||||||||
|
Interest on short-term borrowings
|
381
|
352
|
277
|
283
|
358
|
|||||||||||||||
|
Total interest expense
|
7,681
|
6,125
|
5,215
|
4,706
|
4,182
|
|||||||||||||||
|
Net interest income
|
39,732
|
40,739
|
40,523
|
40,109
|
39,315
|
|||||||||||||||
|
|
||||||||||||||||||||
|
Less: Provision for loan losses
|
300
|
500
|
300
|
300
|
300
|
|||||||||||||||
|
Net interest income after provision for loan losses
|
39,432
|
40,239
|
40,223
|
39,809
|
39,015
|
|||||||||||||||
|
Noninterest income:
|
||||||||||||||||||||
|
Trustco Financial Services income
|
1,733
|
1,356
|
1,516
|
1,596
|
1,815
|
|||||||||||||||
|
Fees for services to customers
|
2,520
|
2,897
|
2,693
|
2,677
|
2,645
|
|||||||||||||||
|
Other
|
384
|
199
|
246
|
222
|
219
|
|||||||||||||||
|
Total noninterest income
|
4,637
|
4,452
|
4,455
|
4,495
|
4,679
|
|||||||||||||||
|
Noninterest expenses:
|
||||||||||||||||||||
|
Salaries and employee benefits
|
11,451
|
10,183
|
10,761
|
10,741
|
10,422
|
|||||||||||||||
|
Net occupancy expense
|
4,167
|
4,800
|
3,997
|
4,101
|
4,315
|
|||||||||||||||
|
Equipment expense
|
1,902
|
1,741
|
1,783
|
1,793
|
1,751
|
|||||||||||||||
|
Professional services
|
1,650
|
1,733
|
1,578
|
1,814
|
1,430
|
|||||||||||||||
|
Outsourced services
|
1,925
|
1,875
|
1,875
|
1,825
|
1,925
|
|||||||||||||||
|
Advertising expense
|
785
|
876
|
844
|
670
|
630
|
|||||||||||||||
|
FDIC and other insurance
|
648
|
522
|
682
|
514
|
1,023
|
|||||||||||||||
|
Other real estate (income) expense, net
|
(24
|
)
|
37
|
528
|
294
|
372
|
||||||||||||||
|
Other
|
2,363
|
3,152
|
2,496
|
2,343
|
2,287
|
|||||||||||||||
|
Total noninterest expenses
|
24,867
|
24,919
|
24,544
|
24,095
|
24,155
|
|||||||||||||||
|
Income before taxes
|
19,202
|
19,772
|
20,134
|
20,209
|
19,539
|
|||||||||||||||
|
Income taxes
|
4,644
|
3,739
|
4,935
|
4,804
|
4,731
|
|||||||||||||||
|
Net income
|
$
|
14,558
|
16,033
|
15,199
|
15,405
|
14,808
|
||||||||||||||
|
Net income per common share:
|
||||||||||||||||||||
|
- Basic
|
$
|
0.150
|
0.166
|
0.157
|
0.160
|
0.154
|
||||||||||||||
|
|
||||||||||||||||||||
|
- Diluted
|
0.150
|
0.166
|
0.157
|
0.160
|
0.153
|
|||||||||||||||
|
Average basic shares (in thousands)
|
96,744
|
96,555
|
96,555
|
96,449
|
96,353
|
|||||||||||||||
|
Average diluted shares (in thousands)
|
96,822
|
96,689
|
96,689
|
96,580
|
96,490
|
|||||||||||||||
|
Note: Taxable equivalent net interest income
|
$
|
39,733
|
40,740
|
40,526
|
40,119
|
39,319
|
||||||||||||||
Page | 6
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(dollars in thousands)
(Unaudited)
|
3/31/2019
|
12/31/2018
|
9/30/2018
|
6/30/2018
|
3/31/2018
|
||||||||||||||||
|
ASSETS:
|
||||||||||||||||||||
|
Cash and due from banks
|
$
|
43,064
|
49,260
|
42,195
|
40,567
|
39,373
|
||||||||||||||
|
Federal funds sold and other short term investments
|
576,123
|
454,449
|
423,254
|
546,049
|
577,797
|
|||||||||||||||
|
Total cash and cash equivalents
|
619,187
|
503,709
|
465,449
|
586,616
|
617,170
|
|||||||||||||||
|
Securities available for sale:
|
||||||||||||||||||||
|
U. S. government sponsored enterprises
|
148,292
|
152,160
|
150,053
|
150,704
|
151,327
|
|||||||||||||||
|
States and political subdivisions
|
172
|
173
|
180
|
524
|
525
|
|||||||||||||||
|
Mortgage-backed securities and collateralized mortgage obligations - residential
|
312,946
|
262,032
|
269,093
|
283,252
|
297,633
|
|||||||||||||||
|
Small Business Administration - guaranteed participation securities
|
54,113
|
56,475
|
57,894
|
61,876
|
64,113
|
|||||||||||||||
|
Mortgage-backed securities and collateralized mortgage obligations - commercial
|
-
|
-
|
-
|
-
|
9,573
|
|||||||||||||||
|
Corporate bonds
|
30,258
|
29,938
|
29,977
|
29,977
|
35,227
|
|||||||||||||||
|
Other securities
|
685
|
685
|
685
|
685
|
685
|
|||||||||||||||
|
Total securities available for sale
|
546,466
|
501,463
|
507,882
|
527,018
|
559,083
|
|||||||||||||||
|
Held to maturity securities:
|
||||||||||||||||||||
|
Mortgage-backed securities and collateralized mortgage obligations-residential
|
21,609
|
22,501
|
23,462
|
24,730
|
26,174
|
|||||||||||||||
|
Total held to maturity securities
|
21,609
|
22,501
|
23,462
|
24,730
|
26,174
|
|||||||||||||||
|
Federal Reserve Bank and Federal Home Loan Bank stock
|
8,953
|
8,953
|
8,953
|
8,953
|
8,779
|
|||||||||||||||
|
Loans:
|
||||||||||||||||||||
|
Commercial
|
190,347
|
196,146
|
190,987
|
190,904
|
185,129
|
|||||||||||||||
|
Residential mortgage loans
|
3,376,193
|
3,376,708
|
3,331,212
|
3,245,151
|
3,171,548
|
|||||||||||||||
|
Home equity line of credit
|
282,034
|
289,540
|
293,750
|
295,791
|
301,885
|
|||||||||||||||
|
Installment loans
|
12,579
|
11,702
|
9,967
|
9,309
|
8,413
|
|||||||||||||||
|
Loans, net of deferred net costs
|
3,861,153
|
3,874,096
|
3,825,916
|
3,741,155
|
3,666,975
|
|||||||||||||||
|
Less: Allowance for loan losses
|
44,671
|
44,766
|
44,736
|
44,503
|
44,379
|
|||||||||||||||
|
Net loans
|
3,816,482
|
3,829,330
|
3,781,180
|
3,696,652
|
3,622,596
|
|||||||||||||||
|
Bank premises and equipment, net
|
34,428
|
34,694
|
35,214
|
35,521
|
35,240
|
|||||||||||||||
|
Operating lease right-of-use assets
|
51,559
|
-
|
-
|
-
|
-
|
|||||||||||||||
|
Other assets
|
57,637
|
58,263
|
63,211
|
61,069
|
62,522
|
|||||||||||||||
|
Total assets
|
$
|
5,156,321
|
4,958,913
|
4,885,351
|
4,940,559
|
4,931,564
|
||||||||||||||
|
LIABILITIES:
|
||||||||||||||||||||
|
Deposits:
|
||||||||||||||||||||
|
Demand
|
$
|
408,417
|
405,069
|
403,047
|
404,564
|
403,782
|
||||||||||||||
|
Interest-bearing checking
|
895,099
|
904,678
|
918,486
|
925,295
|
915,163
|
|||||||||||||||
|
Savings accounts
|
1,150,329
|
1,182,683
|
1,221,127
|
1,257,744
|
1,266,852
|
|||||||||||||||
|
Money market deposit accounts
|
538,043
|
507,311
|
501,270
|
512,453
|
539,839
|
|||||||||||||||
|
Time deposits
|
1,421,181
|
1,274,506
|
1,155,994
|
1,155,214
|
1,109,444
|
|||||||||||||||
|
Total deposits
|
4,413,069
|
4,274,247
|
4,199,924
|
4,255,270
|
4,235,080
|
|||||||||||||||
|
Short-term borrowings
|
159,778
|
161,893
|
176,377
|
182,705
|
203,910
|
|||||||||||||||
|
Operating lease liabilities
|
56,723
|
-
|
-
|
-
|
-
|
|||||||||||||||
|
Accrued expenses and other liabilities
|
25,033
|
32,902
|
31,932
|
31,769
|
30,477
|
|||||||||||||||
|
Total liabilities
|
4,654,603
|
4,469,042
|
4,408,233
|
4,469,744
|
4,469,467
|
|||||||||||||||
|
SHAREHOLDERS' EQUITY:
|
||||||||||||||||||||
|
Capital stock
|
100,180
|
100,175
|
100,175
|
100,093
|
100,002
|
|||||||||||||||
|
Surplus
|
176,510
|
176,710
|
176,764
|
176,243
|
175,674
|
|||||||||||||||
|
Undivided profits
|
264,364
|
256,397
|
246,965
|
238,342
|
229,267
|
|||||||||||||||
|
Accumulated other comprehensive loss, net of tax
|
(7,011
|
)
|
(10,309
|
)
|
(13,000
|
)
|
(9,796
|
)
|
(8,490
|
)
|
||||||||||
|
Treasury stock at cost
|
(32,325
|
)
|
(33,102
|
)
|
(33,786
|
)
|
(34,067
|
)
|
(34,356
|
)
|
||||||||||
|
Total shareholders' equity
|
501,718
|
489,871
|
477,118
|
470,815
|
462,097
|
|||||||||||||||
|
|
||||||||||||||||||||
|
Total liabilities and shareholders' equity
|
$
|
5,156,321
|
4,958,913
|
4,885,351
|
4,940,559
|
4,931,564
|
||||||||||||||
|
Outstanding shares (in thousands)
|
96,746
|
96,659
|
96,586
|
96,475
|
96,359
|
|||||||||||||||
Page | 7
NONPERFORMING ASSETS
(dollars in thousands)
(Unaudited)
|
3/31/2019
|
12/31/2018
|
9/30/2018
|
6/30/2018
|
3/31/2018
|
||||||||||||||||
|
Nonperforming Assets
|
||||||||||||||||||||
|
New York and other states*
|
||||||||||||||||||||
|
Loans in nonaccrual status:
|
||||||||||||||||||||
|
Commercial
|
$
|
701
|
645
|
928
|
767
|
1,213
|
||||||||||||||
|
Real estate mortgage - 1 to 4 family
|
22,343
|
22,373
|
20,750
|
21,209
|
21,424
|
|||||||||||||||
|
Installment
|
26
|
4
|
13
|
6
|
19
|
|||||||||||||||
|
Total non-accrual loans
|
23,070
|
23,022
|
21,691
|
21,982
|
22,656
|
|||||||||||||||
|
Other nonperforming real estate mortgages - 1 to 4 family
|
33
|
34
|
35
|
36
|
38
|
|||||||||||||||
|
Total nonperforming loans
|
23,103
|
23,056
|
21,726
|
22,018
|
22,694
|
|||||||||||||||
|
Other real estate owned
|
1,262
|
1,675
|
2,306
|
2,569
|
2,190
|
|||||||||||||||
|
Total nonperforming assets
|
$
|
24,365
|
24,731
|
24,032
|
24,587
|
24,884
|
||||||||||||||
|
Florida
|
||||||||||||||||||||
|
Loans in nonaccrual status:
|
||||||||||||||||||||
|
Commercial
|
$
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
|
Real estate mortgage - 1 to 4 family
|
1,644
|
1,915
|
2,054
|
2,143
|
2,154
|
|||||||||||||||
|
Installment
|
-
|
15
|
13
|
-
|
4
|
|||||||||||||||
|
Total non-accrual loans
|
1,644
|
1,930
|
2,067
|
2,143
|
2,158
|
|||||||||||||||
|
Other nonperforming real estate mortgages - 1 to 4 family
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
|
Total nonperforming loans
|
1,644
|
1,930
|
2,067
|
2,143
|
2,158
|
|||||||||||||||
|
Other real estate owned
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
|
Total nonperforming assets
|
$
|
1,644
|
1,930
|
2,067
|
2,143
|
2,158
|
||||||||||||||
|
Total
|
||||||||||||||||||||
|
Loans in nonaccrual status:
|
||||||||||||||||||||
|
Commercial
|
$
|
701
|
645
|
928
|
767
|
1,213
|
||||||||||||||
|
Real estate mortgage - 1 to 4 family
|
23,987
|
24,288
|
22,804
|
23,352
|
23,578
|
|||||||||||||||
|
Installment
|
26
|
19
|
26
|
6
|
23
|
|||||||||||||||
|
Total non-accrual loans
|
24,714
|
24,952
|
23,758
|
24,125
|
24,814
|
|||||||||||||||
|
Other nonperforming real estate mortgages - 1 to 4 family
|
33
|
34
|
35
|
36
|
38
|
|||||||||||||||
|
Total nonperforming loans
|
24,747
|
24,986
|
23,793
|
24,161
|
24,852
|
|||||||||||||||
|
Other real estate owned
|
1,262
|
1,675
|
2,306
|
2,569
|
2,190
|
|||||||||||||||
|
Total nonperforming assets
|
$
|
26,009
|
26,661
|
26,099
|
26,730
|
27,042
|
||||||||||||||
|
Quarterly Net Chargeoffs (Recoveries)
|
||||||||||||||||||||
|
New York and other states*
|
||||||||||||||||||||
|
Commercial
|
$
|
4
|
99
|
(2
|
)
|
(1
|
)
|
(6
|
)
|
|||||||||||
|
Real estate mortgage - 1 to 4 family
|
318
|
323
|
(3
|
)
|
150
|
28
|
||||||||||||||
|
Installment
|
23
|
35
|
64
|
27
|
66
|
|||||||||||||||
|
Total net chargeoffs
|
$
|
345
|
457
|
59
|
176
|
88
|
||||||||||||||
|
Florida
|
||||||||||||||||||||
|
Commercial
|
$
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||
|
Real estate mortgage - 1 to 4 family
|
19
|
(3
|
)
|
-
|
-
|
-
|
||||||||||||||
|
Installment
|
31
|
16
|
8
|
-
|
2
|
|||||||||||||||
|
Total net chargeoffs
|
$
|
50
|
13
|
8
|
-
|
2
|
||||||||||||||
|
Total
|
||||||||||||||||||||
|
Commercial
|
$
|
4
|
99
|
(2
|
)
|
(1
|
)
|
(6
|
)
|
|||||||||||
|
Real estate mortgage - 1 to 4 family
|
337
|
320
|
(3
|
)
|
150
|
28
|
||||||||||||||
|
Installment
|
54
|
51
|
72
|
27
|
68
|
|||||||||||||||
|
Total net chargeoffs
|
$
|
395
|
470
|
67
|
176
|
90
|
||||||||||||||
|
Asset Quality Ratios
|
||||||||||||||||||||
|
Total nonperforming loans (1)
|
$
|
24,747
|
24,986
|
23,793
|
24,161
|
24,852
|
||||||||||||||
|
Total nonperforming assets (1)
|
26,009
|
26,661
|
26,099
|
26,730
|
27,042
|
|||||||||||||||
|
Total net chargeoffs (2)
|
395
|
470
|
67
|
176
|
90
|
|||||||||||||||
|
Allowance for loan losses (1)
|
44,671
|
44,766
|
44,736
|
44,503
|
44,379
|
|||||||||||||||
|
Nonperforming loans to total loans
|
0.64
|
%
|
0.64
|
%
|
0.62
|
%
|
0.65
|
%
|
0.68
|
%
|
||||||||||
|
Nonperforming assets to total assets
|
0.50
|
%
|
0.54
|
%
|
0.53
|
%
|
0.54
|
%
|
0.55
|
%
|
||||||||||
|
Allowance for loan losses to total loans
|
1.16
|
%
|
1.16
|
%
|
1.17
|
%
|
1.19
|
%
|
1.21
|
%
|
||||||||||
|
Coverage ratio (1)
|
180.5
|
%
|
179.2
|
%
|
188.0
|
%
|
184.2
|
%
|
178.6
|
%
|
||||||||||
|
Annualized net chargeoffs to average loans (2)
|
0.04
|
%
|
0.05
|
%
|
0.01
|
%
|
0.02
|
%
|
0.01
|
%
|
||||||||||
|
Allowance for loan losses to annualized net chargeoffs (2)
|
28.3
|
x
|
23.8
|
x
|
166.9
|
x
|
63.2
|
x
|
123.3
|
x
|
||||||||||
* Includes New York, New Jersey, Vermont and Massachusetts.
| (1) |
At period-end
|
| (2) |
For the period ended
|
Page | 8
DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY -
INTEREST RATES AND INTEREST DIFFERENTIAL
|
(dollars in thousands)
(Unaudited)
|
Three months ended
March 31, 2019
|
Three months ended
March 31, 2018
|
||||||||||||||||||||||
|
Average
Balance
|
Interest
|
Average
Rate
|
Average
Balance
|
Interest
|
Average
Rate
|
|||||||||||||||||||
|
Assets
|
||||||||||||||||||||||||
|
Securities available for sale:
|
||||||||||||||||||||||||
|
U. S. government sponsored enterprises
|
$
|
154,258
|
783
|
2.03
|
%
|
$
|
156,593
|
750
|
1.92
|
%
|
||||||||||||||
|
Mortgage backed securities and collateralized mortgage obligations - residential
|
273,004
|
1,555
|
2.28
|
313,753
|
1,763
|
2.25
|
||||||||||||||||||
|
State and political subdivisions
|
168
|
2
|
7.85
|
515
|
10
|
7.81
|
||||||||||||||||||
|
Corporate bonds
|
26,862
|
208
|
3.09
|
33,297
|
133
|
1.60
|
||||||||||||||||||
|
Small Business Administration - guaranteed participation securities
|
57,057
|
297
|
2.08
|
67,106
|
352
|
2.10
|
||||||||||||||||||
|
Mortgage backed securities and collateralized mortgage obligations - commercial
|
-
|
-
|
-
|
9,775
|
42
|
1.71
|
||||||||||||||||||
|
Other
|
685
|
5
|
2.92
|
685
|
5
|
2.52
|
||||||||||||||||||
|
Total securities available for sale
|
512,034
|
2,850
|
2.23
|
581,724
|
3,055
|
2.12
|
||||||||||||||||||
|
Federal funds sold and other short-term Investments
|
502,976
|
3,009
|
2.43
|
528,947
|
2,017
|
1.55
|
||||||||||||||||||
|
Held to maturity securities:
|
||||||||||||||||||||||||
|
Mortgage backed securities and collateralized mortgage obligations - residential
|
22,037
|
217
|
3.94
|
26,799
|
260
|
3.88
|
||||||||||||||||||
|
Total held to maturity securities
|
22,037
|
217
|
3.94
|
26,799
|
260
|
3.88
|
||||||||||||||||||
|
Federal Reserve Bank and Federal Home Loan Bank stock
|
8,953
|
85
|
3.80
|
8,779
|
77
|
3.51
|
||||||||||||||||||
|
Commercial loans
|
193,738
|
2,583
|
5.33
|
185,646
|
2,420
|
5.21
|
||||||||||||||||||
|
Residential mortgage loans
|
3,374,990
|
34,864
|
4.14
|
3,148,735
|
32,257
|
4.11
|
||||||||||||||||||
|
Home equity lines of credit
|
286,199
|
3,537
|
5.01
|
306,290
|
3,210
|
4.25
|
||||||||||||||||||
|
Installment loans
|
11,897
|
269
|
9.17
|
8,365
|
205
|
9.90
|
||||||||||||||||||
|
Loans, net of unearned income
|
3,866,824
|
41,253
|
4.28
|
3,649,036
|
38,092
|
4.19
|
||||||||||||||||||
|
Total interest earning assets
|
4,912,824
|
47,414
|
3.87
|
4,795,285
|
43,501
|
3.64
|
||||||||||||||||||
|
Allowance for loan losses
|
(44,947
|
)
|
(44,393
|
)
|
||||||||||||||||||||
|
Cash & non-interest earning assets
|
176,009
|
124,867
|
||||||||||||||||||||||
|
Total assets
|
$
|
5,043,886
|
$
|
4,875,759
|
||||||||||||||||||||
|
Liabilities and shareholders' equity
|
||||||||||||||||||||||||
|
Deposits:
|
||||||||||||||||||||||||
|
Interest bearing checking accounts
|
$
|
880,474
|
121
|
0.06
|
%
|
$
|
877,776
|
106
|
0.05
|
%
|
||||||||||||||
|
Money market accounts
|
517,995
|
826
|
0.65
|
547,136
|
439
|
0.33
|
||||||||||||||||||
|
Savings
|
1,160,142
|
377
|
0.13
|
1,260,360
|
419
|
0.13
|
||||||||||||||||||
|
Time deposits
|
1,353,160
|
5,976
|
1.79
|
1,080,893
|
2,860
|
1.07
|
||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Total interest bearing deposits
|
3,911,771
|
7,300
|
0.76
|
3,766,165
|
3,824
|
0.41
|
||||||||||||||||||
|
Short-term borrowings
|
159,076
|
381
|
0.97
|
234,384
|
358
|
0.62
|
||||||||||||||||||
|
Total interest bearing liabilities
|
4,070,847
|
7,681
|
0.77
|
4,000,549
|
4,182
|
0.42
|
||||||||||||||||||
|
Demand deposits
|
397,522
|
386,563
|
||||||||||||||||||||||
|
Other liabilities
|
80,579
|
29,129
|
||||||||||||||||||||||
|
Shareholders' equity
|
494,938
|
459,519
|
||||||||||||||||||||||
|
Total liabilities and shareholders' equity
|
$
|
5,043,886
|
$
|
4,875,760
|
||||||||||||||||||||
|
Net interest income, tax equivalent
|
39,733
|
39,319
|
||||||||||||||||||||||
|
Net interest spread
|
3.11
|
%
|
3.22
|
%
|
||||||||||||||||||||
|
Net interest margin (net interest income to total interest earning assets)
|
3.24
|
%
|
3.29
|
%
|
||||||||||||||||||||
|
Tax equivalent adjustment
|
(1
|
)
|
(4
|
)
|
||||||||||||||||||||
|
Net interest income
|
39,732
|
39,315
|
||||||||||||||||||||||
Page | 9
Non-GAAP Financial Measures Reconciliation
Tangible equity as a percentage of tangible assets at period end is a non-GAAP financial measure derived from GAAP-based amounts. We calculate
tangible equity and tangible assets by excluding the balance of intangible assets from shareholders’ equity and total assets, respectively. We calculate tangible equity as a percentage of tangible assets at period end by dividing tangible equity by
tangible assets at period end. We believe that this is consistent with the treatment by bank regulatory agencies, which exclude intangible assets from the calculation of risk-based capital ratios.
The efficiency ratio is a non-GAAP measure of expense control relative to revenue from net interest income and fee income. We calculate the
efficiency ratio by dividing total noninterest expenses as determined under GAAP, but excluding other real estate expense, net, by net interest income (fully taxable equivalent) and total noninterest income as determined under GAAP, but excluding
net gains on the sale of nonperforming loans and securities and other non-routine items from this calculation. We believe that this provides a reasonable measure of primary banking expenses relative to primary banking revenue.
We believe that these non-GAAP financial measures provide information that is important to investors and that is useful in understanding our
financial results. Our management internally assesses our performance based, in part, on these measures. However, these non-GAAP financial measures are supplemental and not a substitute for an analysis based on GAAP measures. As other companies
may use different calculations for these measures, this presentation may not be comparable to other similarly titled measures reported by other companies. A reconciliation of the non-GAAP measures of tangible common equity, tangible book value per
share, efficiency ratio, net income and net income per share to the underlying GAAP numbers is set forth below.
NON-GAAP FINANCIAL MEASURES RECONCILIATION
(dollars in thousands, except per share amounts)
(Unaudited)
|
3/31/2019
|
12/31/2018
|
3/31/2018
|
||||||||||
|
Tangible Equity to Tangible Assets
|
||||||||||||
|
Total Assets
|
$
|
5,156,321
|
4,958,913
|
4,931,564
|
||||||||
|
Less: Intangible assets
|
553
|
553
|
553
|
|||||||||
|
Tangible assets
|
5,155,768
|
4,958,360
|
4,931,011
|
|||||||||
|
Equity
|
501,718
|
489,871
|
462,097
|
|||||||||
|
Less: Intangible assets
|
553
|
553
|
553
|
|||||||||
|
Tangible equity
|
501,165
|
489,318
|
461,544
|
|||||||||
|
Tangible Equity to Tangible Assets
|
9.72
|
%
|
9.87
|
%
|
9.36
|
%
|
||||||
|
Equity to Assets
|
9.73
|
%
|
9.88
|
%
|
9.37
|
%
|
||||||
|
Three months ended
|
||||||||||||
|
Efficiency Ratio
|
3/31/2019
|
12/31/2018
|
3/31/2018
|
|||||||||
|
Net interest income (fully taxable equivalent)
|
39,733
|
40,740
|
39,319
|
|||||||||
|
Non-interest income
|
4,637
|
4,452
|
4,679
|
|||||||||
|
Revenue used for efficiency ratio
|
44,370
|
45,192
|
43,998
|
|||||||||
|
Total noninterest expense
|
24,867
|
24,919
|
24,155
|
|||||||||
|
Less: Other real estate (income) expense, net
|
(24
|
)
|
37
|
372
|
||||||||
|
Expense used for efficiency ratio
|
24,891
|
24,882
|
23,783
|
|||||||||
|
Efficiency Ratio
|
56.10
|
%
|
55.06
|
%
|
54.05
|
%
|
||||||
Page | 10