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Tompkins Financial Corporation Reports Increase in Fourth Quarter Earnings

Tompkins Financial Corporation (NYSE American: TMP)

Tompkins Financial Corporation ("Tompkins" or the "Company") reported diluted earnings per share of $1.36 for the fourth quarter of 2022, up 2.3% compared to $1.33 reported in the fourth quarter of 2021. Net income for the fourth quarter of 2022 was $19.5 million, which was unchanged when compared to the same period in 2021.

For the year ended December 31, 2022, diluted earnings per share of $5.89 were down 2.6% compared to the year ended December 31, 2021. Net income for 2022 was $85.0 million, a decrease of $4.2 million compared to the year ended December 31, 2021. Significant contributors to the negative variance in annual net income included a reduction in net deferred loan fees associated with PPP loans from $11.2 million in 2021 to $3.0 million in 2022, as well as an increase in provision for credit loss expense, which was a credit of $2.2 million in 2021 versus an expense of $2.8 million in 2022.

During the fourth quarter of 2022, the Company sold its VISA Class B common shares, recognizing a pre-tax gain of $11.4 million. Also in the fourth quarter of 2022, the Company sold $147.9 million of available-for-sale securities, recognizing a pre-tax loss on the sale of $11.9 million. The available-for-sale securities sold during the quarter had an average yield of 0.41% and remaining life of 2.1 years. Proceeds from the sale of the VISA Class B shares and the available-for-sale securities were used to pay down overnight borrowings with the FHLB.

Tompkins President and CEO, Stephen Romaine, commented, "We are pleased to report earnings growth in the fourth quarter of 2022, when compared to the same quarter last year. The quality of our balance sheet remains a strength, as we had net credit recoveries for the year and nonperforming loans remain near historic lows. Our performance metrics remain strong as we begin a new year facing economic uncertainty and a challenging interest rate environment. We remain focused on growth that is built on quality customer relationships and on improving the overall efficiency of our Company."

SELECTED HIGHLIGHTS FOR THE PERIOD:

  • Total loans at December 31, 2022 were $5.3 billion, up $60.5 million over the immediate prior quarter, reflecting an annualized increase of 4.7% from September 30, 2022, and up $193.4 million or 3.8% from December 31, 2021. Excluding PPP loans, total loans at December 31, 2022 were up 5.3% over year-end 2021.
  • Total deposits at December 31, 2022 were $6.6 billion, down $189.1 million or 2.8% from December 31, 2021, while noninterest bearing deposits of $2.2 billion were up $14.4 million or 0.7% over the same time period.
  • Net interest margin of 3.02% for the quarter ended December 31, 2022 was down from 3.04% for the quarter ended September 30, 2022, and up from 3.01% for the quarter ended December 31, 2021.
  • Return on average equity for the year ended December 31, 2022 of 13.25% was higher than any of the previous three years.

NET INTEREST INCOME

Net interest margin was 3.02% for the fourth quarter of 2022, down compared to the 3.04% reported for the third quarter of 2022, and up compared to the 3.01% reported for the fourth quarter of 2021. The decrease in margin from the third quarter of 2022 was due primarily to the increase in interest expense on interest-bearing deposits and short-term borrowings, partially offset by higher yields on loan, securities and cash, reflective of the higher interest rate environment.

Net interest income was $57.3 million for the fourth quarter of 2022, down from $58.1 million for the third quarter of 2022 and $57.8 million for the fourth quarter of 2021. Full year net interest income was $230.3 million for the year ended December 31, 2022, up from $223.8 million reported for the year ended December 31, 2021.

Comparisons to prior periods are impacted by net fees on PPP loans, which have largely paid down during 2022. Net interest income in the current quarter included $5,000 of net deferred loan fees associated with PPP loans, down from $88,000 of net deferred PPP loan fees for the third quarter of 2022, and $3.2 million of net deferred PPP loan fees for the fourth quarter of 2021. Full year net interest income for 2021 included net deferred loan fees associated with PPP loans of $11.2 million and a $1.9 million purchase accounting charge related to the redemption of $15.2 million in trust preferred securities; full year net deferred loan fees on PPP loans in 2022 were $3.0 million.

Average loans for the quarter ended December 31, 2022 increased $145.7 million, or 2.9%, compared to the same period in 2021, and were in line with average loans for the third quarter of 2022. The increase in average loans as compared to the same period in the prior year was mainly in commercial and residential real estate loans, which were up 7.9% and 4.9%, respectively. Commercial and industrial loans were down 14.6%, mainly driven by lower PPP loan balances. Average loan yields for the quarter ended December 31, 2022 were up 27 basis points from the third quarter of 2022 and up 32 basis points compared to the same period in 2021.

Average loans for the year ended December 31, 2022 were in line with average loans for the year ended December 31, 2021. Average loan yields for the year ended December 31, 2022, were up 9 basis points compared to 2021, which reflects the impact of rising market interest rates in 2022.

Average total deposits for the fourth quarter of 2022 were down $261.8 million, or 3.8%, compared to the same period in 2021 and were down $108.1 million, or 1.6%, compared to average deposits for the third quarter of 2022. The decrease was largely driven by inflation and higher rate alternatives due to current interest rate environment and tighter monetary policy. The total cost of interest-bearing liabilities of 0.84% for the fourth quarter of 2022 represented an increase of 39 basis points over the third quarter of 2022, and an increase of 62 basis points over the same period in 2021.

Average total deposits for 2022 were flat compared to 2021. Average noninterest bearing deposits for 2022 were up $90.2 million, or 4.3%, compared to 2021. The total cost of interest-bearing liabilities for full year ended December 31, 2022 increased by 8 basis points to 0.43% from the same period in 2021.

NONINTEREST INCOME

Noninterest income of $18.4 million for the fourth quarter of 2022 was down 4.2% compared to the same period in 2021. Negatively impacting noninterest income during the quarter were lower wealth management fees, primarily due to market conditions, as well as a net loss on sale of securities of $455,000.

For the full year 2022, noninterest income of $78.0 million was down 1.1% from 2021. Year to date 2022 noninterest income reflected higher revenue from insurance commissions, deposit fees and card services fees, which were offset by lower wealth management fees and net losses of $634,000 on securities transactions.

NONINTEREST EXPENSE

Noninterest expense was $50.2 million for the fourth quarter of 2022, up $2.0 million, or 4.2%, over the fourth quarter of 2021, with the increase largely driven by higher personnel related costs. Increased spending on marketing and technology also contributed to expense growth in the fourth quarter of 2022 compared to the same period in 2021.

For the full year 2022, noninterest expense was $195.8 million, up $5.5 million, or 2.9%, over 2021. The growth in noninterest expense for the year-to-date period was primarily driven by increases in salaries, wages and benefits and other noninterest expense. Contributing to the growth in these expense items were nonrecurring expenses of $1.2 million, related to the consolidation and rebranding of the Company's four banking charters The year-to-date period in 2021 included $2.9 million in penalties related to the prepayment of $135.0 million in FHLB fixed rate advances.

INCOME TAX EXPENSE

The Company's effective tax rate was 18.6% for the fourth quarter of 2022, compared to 21.7% for the same period in 2021. The effective tax rate for the year ended December 31, 2022 was 22.4%, compared to 22.0% reported for 2021.

The Company's banking subsidiary has an investment in a real estate investment trust that provides certain benefits on its New York State tax return for qualifying entities. A condition to claim these benefits is that the consolidated company has qualified assets of no more than $8.0 billion for the taxable year. Prior to the fourth quarter of 2022, the Company expected to exceed the asset threshold and its effective tax rate reflected the anticipated loss of these tax benefits. With the decrease in total assets between September 30, 2022 and December 31, 2022, the Company retained the tax benefits, and as a result, adjusted its tax rate in the fourth quarter of 2022 to reflect the retention of the benefits. The Company will continue to monitor consolidated average assets to determine future eligibility.

ASSET QUALITY

The allowance for credit losses represented 0.87% of total loans and leases at December 31, 2022, up from 0.86% at September 30, 2022 and 0.84% at December 31, 2021. The ratio of the allowance to total nonperforming loans and leases improved to 139.85% at December 31, 2022, up compared to 128.27% at September 30, 2022 and 137.51% at December 31, 2021.

The provision for credit loss expense for the fourth quarter of 2022 was $1.4 million compared to $3.9 million for the same period in 2021. Provision expense for the year ended December 31, 2022 was an expense of $2.8 million, compared to a credit of $2.2 million for 2021. The increase in the provision for credit losses for the year-ended December 31, 2022 is mainly driven by current economic forecasts coupled with loan growth.

Nonperforming assets represented 0.43% of total assets at December 31, 2022, down from 0.45% at September 30, 2022, and up from 0.40% at December 31, 2021. At December 31, 2022, nonperforming loans and leases totaled $32.8 million, compared to $34.9 million at September 30, 2022 and $31.2 million at December 31, 2021.

Special Mention and Substandard loans and leases totaled $98.3 million at December 31, 2022, reflecting improvement from $106.7 million at September 30, 2022, and $137.6 million at December 31, 2021.

CAPITAL POSITION

Capital ratios at December 31, 2022 remained well above the regulatory minimums for well-capitalized institutions. The ratio of Total Capital to Risk-Weighted Assets was 14.42% at December 31, 2022, compared to 14.26% at September 30, 2022 and 14.23% at December 31, 2021. The ratio of Tier 1 capital to average assets was 9.34% at December 31, 2022, compared to 9.14% at September 30, 2022 and 8.72% at December 31, 2021.

ABOUT TOMPKINS FINANCIAL CORPORATION

Tompkins Financial Corporation is a banking and financial services company serving the Central, Western, and Hudson Valley regions of New York and the Southeastern region of Pennsylvania. Headquartered in Ithaca, NY, Tompkins Financial is parent to Tompkins Community Bank, Tompkins Insurance Agencies, Inc., and offers wealth management services through Tompkins Financial Advisors. For more information on Tompkins Financial, visit www.tompkinsfinancial.com.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995:

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are neither historical facts nor assurances of future performance. Forward-looking statements may be identified by use of such words as "may", "will", "estimate", "intend", "continue", "believe", "expect", "plan", or "anticipate", and other similar words. Forward-looking statements are made based on management’s expectations and beliefs concerning future events impacting the Company and are subject to certain uncertainties and factors relating to the Company’s operations and economic environment, all of which are difficult to predict and many of which are beyond the control of the Company, that could cause actual results of the Company to differ materially from those expressed and/or implied by forward-looking statements. The following factors, in addition to those listed as Risk Factors in Item 1A of our Annual Reports on Form 10-K and our Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission, are among those that could cause actual results to differ materially from the forward-looking statements; changes in general economic, market and regulatory conditions; estimated GDP growth and inflation trends; our ability to attract and retain deposits and access other sources of liquidity; the impact of the interest rate and inflationary environment on the Company's business, financial condition and results of operations; other income or cash flow anticipated from the Company’s operations, investment and/or lending activities; changes in laws and regulations affecting banks, bank holding companies and/or financial holding companies, such as SEC rule making, The Dodd-Frank Act, Basel III, and state and local government mandates; technological developments and changes; the ability to continue to introduce competitive new products and services on a timely, cost-effective basis; governmental and public policy changes, including environmental regulation; reliance on large customers; uncertainties arising from national and global events such as the war in the Ukraine, including the potential impact of widespread protests, civil unrest, and political uncertainty on the economy and the financial services industry; public health crises and pandemics, including the COVID-19 pandemic, and their effects on the economic and business environments in which we operate, including on our credit quality and business operations, as well as the impact on general economic and financial market conditions; cybersecurity threats and the cost of defending against them; and financial resources in the amounts, at the times and on the terms required to support the Company’s future businesses. The Company does not undertake any obligation to update its forward-looking statements.

TOMPKINS FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF CONDITION

(In thousands, except share and per share data)

As of

As of

ASSETS

12/31/2022

12/31/2021

 

 

(Audited)

 

 

 

Cash and noninterest bearing balances due from banks

$

18,572

 

$

23,078

 

Interest bearing balances due from banks

 

59,265

 

 

40,029

 

Cash and Cash Equivalents

 

77,837

 

 

63,107

 

 

 

 

Available-for-sale debt securities, at fair value (amortized cost of $1,831,791 at December 31, 2022 and $2,063,790 at December 31, 2021)

 

1,594,967

 

 

2,044,513

 

Held-to-maturity securities, at amortized cost (fair value of $261,692 at December 31, 2022 and $282,288 at December 31, 2021)

 

312,344

 

 

284,009

 

Equity securities, at fair value (amortized cost $777 at December 31, 2022 and $902 at December 31, 2021)

 

777

 

 

902

 

Total loans and leases, net of unearned income and deferred costs and fees

 

5,268,911

 

 

5,075,467

 

Less: Allowance for credit losses

 

45,934

 

 

42,843

 

Net Loans and Leases

 

5,222,977

 

 

5,032,624

 

 

 

 

Federal Home Loan Bank and other stock

 

17,720

 

 

10,996

 

Bank premises and equipment, net

 

82,140

 

 

85,416

 

Corporate owned life insurance

 

85,556

 

 

86,495

 

Goodwill

 

92,602

 

 

92,447

 

Other intangible assets, net

 

2,708

 

 

3,643

 

Accrued interest and other assets

 

181,058

 

 

115,830

 

Total Assets

$

7,670,686

 

$

7,819,982

 

LIABILITIES

 

 

Deposits:

 

 

Interest bearing:

 

 

Checking, savings and money market

 

3,820,739

 

 

4,016,025

 

Time

 

631,411

 

 

639,674

 

Noninterest bearing

 

2,150,145

 

 

2,135,736

 

Total Deposits

 

6,602,295

 

 

6,791,435

 

 

 

 

Federal funds purchased and securities sold under agreements to repurchase

 

56,278

 

 

66,787

 

Other borrowings

 

291,300

 

 

124,000

 

Other liabilities

 

103,423

 

 

108,819

 

Total Liabilities

$

7,053,296

 

$

7,091,041

 

EQUITY

 

 

Tompkins Financial Corporation shareholders' equity:

 

 

Common Stock - par value $.10 per share: Authorized 25,000,000 shares; Issued: 14,555,741 at December 31, 2022; and 14,696,911 at December 31, 2021

 

1,456

 

 

1,470

 

Additional paid-in capital

 

302,763

 

 

312,538

 

Retained earnings

 

526,727

 

 

475,262

 

Accumulated other comprehensive loss

 

(208,689

)

 

(55,950

)

Treasury stock, at cost – 128,749 shares at December 31, 2022, and 122,824 shares at December 31, 2021

 

(6,279

)

 

(5,791

)

Total Tompkins Financial Corporation Shareholders’ Equity

 

615,978

 

 

727,529

 

Noncontrolling interests

 

1,412

 

 

1,412

 

Total Equity

$

617,390

 

$

728,941

 

Total Liabilities and Equity

$

7,670,686

 

$

7,819,982

 

 

 

 

TOMPKINS FINANCIAL CORPORATION

 

 

CONSOLIDATED STATEMENTS OF INCOME

 

 

(In thousands, except per share data) (Unaudited)

Three Months Ended

Year Ended

 

12/31/2022

12/31/2021

12/31/2022

12/31/2021

INTEREST AND DIVIDEND INCOME

 

 

 

 

Loans

$

58,930

 

$

53,086

 

$

217,607

 

$

214,684

 

Due from banks

 

181

 

 

77

 

 

371

 

 

343

 

Available-for-sale debt securities

 

6,939

 

 

6,252

 

 

27,929

 

 

23,440

 

Held-to-maturity securities

 

1,221

 

 

1,031

 

 

4,771

 

 

2,075

 

Federal Home Loan Bank and other stock

 

254

 

 

168

 

 

646

 

 

776

 

Total Interest and Dividend Income

 

67,525

 

$

60,614

 

$

251,324

 

$

241,318

 

INTEREST EXPENSE

 

 

 

 

Time certificates of deposits of $250,000 or more

 

909

 

 

478

 

 

2,298

 

 

2,202

 

Other deposits

 

6,973

 

 

1,810

 

 

13,870

 

 

8,645

 

Federal funds purchased and securities sold under agreements to repurchase

 

14

 

 

16

 

 

60

 

 

64

 

Trust preferred debentures

 

0

 

 

0

 

 

0

 

 

2,233

 

Other borrowings

 

2,335

 

 

499

 

 

4,815

 

 

4,382

 

Total Interest Expense

 

10,231

 

 

2,803

 

 

21,043

 

 

17,526

 

Net Interest Income

 

57,294

 

 

57,811

 

 

230,281

 

 

223,792

 

Less: Provision (credit) for credit loss expense

 

1,397

 

 

3,914

 

 

2,789

 

 

(2,219

)

Net Interest Income After Credit for Credit Loss Expense

 

55,897

 

 

53,897

 

 

227,492

 

 

226,011

 

NONINTEREST INCOME

 

 

 

 

Insurance commissions and fees

 

7,630

 

 

7,783

 

 

36,201

 

 

34,836

 

Wealth management fees

 

4,241

 

 

5,041

 

 

18,091

 

 

19,388

 

Service charges on deposit accounts

 

1,913

 

 

1,768

 

 

7,365

 

 

6,347

 

Card services income

 

2,791

 

 

2,775

 

 

11,024

 

 

10,826

 

Other income

 

2,231

 

 

1,795

 

 

5,925

 

 

7,203

 

Net (loss) gain on securities transactions

 

(455

)

 

(8

)

 

(634

)

 

249

 

Total Noninterest Income

 

18,351

 

 

19,154

 

 

77,972

 

 

78,849

 

NONINTEREST EXPENSE

 

 

 

 

Salaries and wages

 

25,249

 

 

24,561

 

 

98,261

 

 

96,038

 

Other employee benefits

 

6,342

 

 

6,285

 

 

24,969

 

 

24,172

 

Net occupancy expense of premises

 

3,163

 

 

3,137

 

 

13,093

 

 

13,179

 

Furniture and fixture expense

 

2,007

 

 

2,108

 

 

8,058

 

 

8,328

 

Amortization of intangible assets

 

218

 

 

329

 

 

873

 

 

1,317

 

Other operating expense

 

13,211

 

 

11,734

 

 

50,497

 

 

47,253

 

Total Noninterest Expenses

 

50,190

 

 

48,154

 

 

195,751

 

 

190,287

 

Income Before Income Tax Expense

 

24,058

 

 

24,897

 

 

109,713

 

 

114,573

 

Income Tax Expense

 

4,478

 

 

5,401

 

 

24,557

 

 

25,182

 

Net Income Attributable to Noncontrolling Interests and Tompkins Financial Corporation

 

19,580

 

 

19,496

 

 

85,156

 

 

89,391

 

Less: Net Income Attributable to Noncontrolling Interests

 

32

 

 

31

 

 

126

 

 

127

 

Net Income Attributable to Tompkins Financial Corporation

$

19,548

 

 

19,465

 

 

85,030

 

 

89,264

 

Basic Earnings Per Share

$

1.36

 

$

1.34

 

$

5.92

 

$

6.08

 

Diluted Earnings Per Share

$

1.36

 

$

1.33

 

$

5.89

 

$

6.05

 

 

 

 

 

 

 

 

 

Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited)

 

Quarter Ended

Quarter Ended

 

December 31, 2022

December 31, 2021

 

Average

 

 

Average

 

 

 

Balance

 

Average

Balance

 

Average

(Dollar amounts in thousands)

(QTD)

Interest

Yield/Rate

(QTD)

Interest

Yield/Rate

ASSETS

 

 

 

 

 

 

Interest-earning assets

 

 

 

 

 

 

Interest-bearing balances due from banks

$

58,488

$

181

 

1.23

%

$

228,570

$

77

 

0.13

%

Securities (1)

 

 

 

 

 

 

U.S. Government securities

 

2,186,858

 

7,627

 

1.38

%

 

2,248,954

 

6,728

 

1.19

%

State and municipal (2)

 

94,377

 

608

 

2.56

%

 

105,215

 

672

 

2.53

%

Other securities (2)

 

3,270

 

47

 

5.68

%

 

3,407

 

23

 

2.64

%

Total securities

 

2,284,505

 

8,282

 

1.44

%

 

2,357,576

 

7,423

 

1.25

%

FHLBNY and FRB stock

 

15,942

 

255

 

6.33

%

 

10,382

 

168

 

6.42

%

Total loans and leases, net of unearned income (2)(3)

 

5,209,721

 

59,140

 

4.50

%

 

5,064,028

 

53,354

 

4.18

%

Total interest-earning assets

 

7,568,656

 

67,858

 

3.56

%

 

7,660,556

 

61,022

 

3.16

%

Other assets

 

152,679

 

 

 

333,260

 

 

Total assets

$

7,721,335

 

 

$

7,993,816

 

 

LIABILITIES & EQUITY

 

 

 

 

 

 

Deposits

 

 

 

 

 

 

Interest-bearing deposits

 

 

 

 

 

 

Interest bearing checking, savings, & money market

$

3,905,570

$

5,888

 

0.60

%

$

4,130,652

$

793

 

0.08

%

Time deposits

 

615,493

 

1,994

 

1.28

%

 

663,713

 

1,495

 

0.89

%

Total interest-bearing deposits

 

4,521,063

 

7,882

 

0.69

%

 

4,794,365

 

2,288

 

0.19

%

Federal funds purchased & securities sold under agreements to repurchase

 

55,701

 

14

 

0.10

%

 

61,976

 

16

 

0.11

%

Other borrowings

 

251,797

 

2,335

 

3.68

%

 

110,370

 

499

 

1.79

%

Trust preferred debentures

 

0

 

0

 

0.00

%

 

0

 

0

 

0.00

%

Total interest-bearing liabilities

 

4,828,561

 

10,231

 

0.84

%

 

4,966,711

 

2,803

 

0.22

%

Noninterest bearing deposits

 

2,196,992

 

 

 

2,185,489

 

 

Accrued expenses and other liabilities

 

115,063

 

 

 

118,997

 

 

Total liabilities

 

7,140,615

 

 

 

7,271,197

 

 

Tompkins Financial Corporation Shareholders’ equity

 

579,223

 

 

 

721,123

 

 

Noncontrolling interest

 

1,497

 

 

 

1,496

 

 

Total equity

 

580,720

 

 

 

722,619

 

 

 

 

 

 

 

 

 

Total liabilities and equity

$

7,721,335

 

 

$

7,993,816

 

 

Interest rate spread

 

 

2.72

%

 

 

2.94

%

Net interest income/margin on earning assets

 

 

57,627

 

3.02

%

 

 

58,219

 

3.01

%

 

 

 

 

 

 

 

Tax Equivalent Adjustment

 

 

(333

)

 

 

 

(408

)

 

Net interest income per consolidated financial statements

 

$

57,294

 

 

 

$

57,811

 

 

Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited)

 

Year to Date Period Ended

Year to Date Period Ended

 

December 31, 2022

December 31, 2021

 

Average

 

 

Average

 

 

 

Balance

 

 

Balance

 

Average

(Dollar amounts in thousands)

(YTD)

Interest

 

(YTD)

Interest

Yield/Rate

ASSETS

 

 

 

 

 

 

Interest-earning assets

 

 

 

 

 

 

Interest-bearing balances due from banks

$

85,788

$

371

 

0.43

%

$

307,253

$

343

 

0.11

%

Securities (1)

 

 

 

 

 

 

U.S. Government securities

 

2,265,226

 

30,587

 

1.35

%

 

2,003,450

 

23,145

 

1.16

%

State and municipal (2)

 

97,283

 

2,490

 

2.56

%

 

112,391

 

2,871

 

2.55

%

Other securities (2)

 

3,329

 

135

 

4.06

%

 

3,417

 

92

 

2.68

%

Total securities

 

2,365,838

 

33,212

 

1.40

%

 

2,119,258

 

26,108

 

1.23

%

FHLBNY and FRB stock

 

13,354

 

646

 

4.84

%

 

14,830

 

776

 

5.24

%

Total loans and leases, net of unearned income (2)(3)

 

5,142,098

 

218,494

 

4.25

%

 

5,184,491

 

215,709

 

4.16

%

Total interest-earning assets

 

7,607,078

 

252,723

 

3.32

%

 

7,625,832

 

242,936

 

3.19

%

Other assets

 

221,442

 

 

 

343,119

 

 

Total assets

$

7,828,520

 

 

$

7,968,951

 

 

LIABILITIES & EQUITY

 

 

 

 

 

 

Deposits

 

 

 

 

 

 

Interest-bearing deposits

 

 

 

 

 

 

Interest bearing checking, savings, & money market

$

4,029,008

$

10,389

 

0.26

%

$

4,034,969

$

3,736

 

0.09

%

Time deposits

 

611,708

 

5,779

 

0.94

%

 

711,381

 

7,111

 

1.00

%

Total interest-bearing deposits

 

4,640,716

 

16,168

 

0.35

%

 

4,746,350

 

10,847

 

0.23

%

Federal funds purchased & securities sold under agreements to repurchase

 

57,126

 

60

 

0.10

%

 

58,627

 

64

 

0.11

%

Other borrowings

 

195,110

 

4,815

 

2.47

%

 

217,799

 

4,382

 

2.01

%

Trust preferred debentures

 

0

 

0

 

0.00

%

 

7,367

 

2,233

 

30.32

%

Total interest-bearing liabilities

 

4,892,952

 

21,043

 

0.43

%

 

5,030,143

 

17,526

 

0.35

%

Noninterest bearing deposits

 

2,186,720

 

 

 

2,096,542

 

 

Accrued expenses and other liabilities

 

107,122

 

 

 

117,790

 

 

Total liabilities

 

7,186,794

 

 

 

7,244,475

 

 

Tompkins Financial Corporation Shareholders’ equity

 

640,258

 

 

 

723,009

 

 

Noncontrolling interest

 

1,468

 

 

 

1,467

 

 

Total equity

 

641,726

 

 

 

724,476

 

 

 

 

 

 

 

 

 

Total liabilities and equity

$

7,828,520

 

 

$

7,968,951

 

 

Interest rate spread

 

 

2.89

%

 

 

2.84

%

Net interest income/margin on earning assets

 

 

231,680

 

3.05

%

 

 

225,410

 

2.96

%

 

 

 

 

 

 

 

Tax Equivalent Adjustment

 

 

(1,399

)

 

 

 

(1,618

)

 

Net interest income per consolidated financial statements

 

$

230,281

 

 

 

$

223,792

 

 

Tompkins Financial Corporation - Summary Financial Data (Unaudited)

(In thousands, except per share data)

 

 

 

 

 

 

 

Quarter-Ended

Year-Ended

Period End Balance Sheet

Dec-22

Sep-22

Jun-22

Mar-22

Dec-21

Dec-22

Securities

$

1,908,088

$

2,054,036

$

2,204,851

$

2,285,527

$

2,329,424

$

1,908,088

Total Loans

 

5,268,911

 

5,208,436

 

5,162,503

 

5,063,451

 

5,075,467

 

5,268,911

Allowance for credit losses

 

45,934

 

44,772

 

43,793

 

42,126

 

42,843

 

45,934

Total assets

 

7,670,686

 

7,779,941

 

7,842,461

 

7,891,111

 

7,819,982

 

7,670,686

Total deposits

 

6,602,295

 

6,936,726

 

6,769,521

 

7,016,739

 

6,791,435

 

6,602,295

Federal funds purchased and securities sold under agreements to repurchase

 

56,278

 

55,340

 

50,075

 

57,115

 

66,787

 

56,278

Other borrowings

 

291,300

 

101,000

 

295,600

 

60,000

 

124,000

 

291,300

Trust preferred debentures

 

0

 

0

 

0

 

0

 

0

 

0

Total common equity

 

615,978

 

571,453

 

622,843

 

656,049

 

727,529

 

615,978

Total equity

 

617,390

 

572,959

 

624,318

 

657,492

 

728,941

 

617,390

Average Balance Sheet

 

 

 

 

 

 

Average earning assets

$

7,568,656

$

7,639,123

$

7,621,588

$

7,598,922

$

7,660,556

$

7,607,078

Average assets

 

7,721,335

 

7,853,847

 

7,830,645

 

7,910,047

 

7,993,816

 

7,828,520

Average interest-bearing liabilities

 

4,828,561

 

4,861,857

 

4,901,345

 

4,982,075

 

4,966,711

 

4,892,952

Average equity

 

580,720

 

635,324

 

639,354

 

713,027

 

722,619

 

641,726

Share data

 

 

 

 

 

 

Weighted average shares outstanding (basic)

 

14,308,323

 

14,289,022

 

14,317,415

 

14,400,003

 

14,452,775

 

14,328,280

Weighted average shares outstanding (diluted)

 

14,385,884

 

14,367,149

 

14,387,601

 

14,478,183

 

14,532,480

 

14,404,294

Period-end shares outstanding

 

14,519,831

 

14,483,757

 

14,504,604

 

14,561,450

 

14,661,001

 

14,519,831

Common equity book value per share

$

42.42

$

39.45

$

42.94

$

45.05

$

49.62

$

42.42

Income Statement

 

 

 

 

 

 

Net interest income

$

57,294

$

58,111

$

58,262

$

56,614

 

$

57,811

$

230,281

Provision (credit) for credit loss expense (5)

 

1,397

 

1,056

 

856

 

(520

)

 

3,914

 

2,789

Noninterest income

 

18,351

 

20,692

 

18,944

 

19,985

 

 

19,154

 

77,972

Noninterest expense (5)

 

50,190

 

49,602

 

49,120

 

46,839

 

 

48,154

 

195,751

Income tax expense

 

4,478

 

6,774

 

6,329

 

6,976

 

 

5,401

 

24,557

Net income attributable to Tompkins Financial Corporation

 

19,548

 

21,340

 

20,869

 

23,273

 

 

19,465

 

85,030

Noncontrolling interests

 

32

 

31

 

32

 

31

 

 

31

 

126

Basic earnings per share (4)

 

1.36

 

1.49

 

1.45

 

1.61

 

 

1.34

 

5.92

Diluted earnings per share (4)

 

1.36

 

1.48

 

1.45

 

1.60

 

 

1.33

 

5.89

Nonperforming Assets

 

 

 

 

 

 

Nonaccrual loans and leases

$

28,289

$

30,013

$

24,665

$

25,200

$

26,033

$

28,290

Loans and leases 90 days past due and accruing

 

25

 

161

 

62

 

0

 

0

 

25

Troubled debt restructuring not included above

 

4,530

 

4,730

 

4,872

 

5,064

 

5,124

 

4,530

Total nonperforming loans and leases

 

32,844

 

34,904

 

29,599

 

30,264

 

31,157

 

32,845

OREO

 

152

 

335

 

122

 

88

 

135

 

152

Total nonperforming assets

$

32,996

$

35,239

$

29,721

$

30,352

$

31,292

$

32,997

Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued

 

Quarter-Ended

Year-Ended

Delinquency - Total loan and lease portfolio

Dec-22

Sep-22

Jun-22

Mar-22

Dec-21

Dec-22

Loans and leases 30-89 days past due and

 

 

 

 

 

 

accruing

$

3,172

$

3,160

$

9,837

$

1,735

$

3,072

$

3,172

Loans and leases 90 days past due and accruing

 

25

 

161

 

62

 

0

 

0

 

25

Total loans and leases past due and accruing

 

3,197

 

3,321

 

9,899

 

1,735

 

3,072

 

3,197

Allowance for Credit Losses

Balance at beginning of period

$

44,772

$

43,793

 

$

42,126

 

$

42,843

 

$

46,259

$

42,843

 

Provision (credit) for credit losses

 

1,352

 

1,101

 

 

780

 

 

(734

)

 

3,600

$

2,499

 

Net loan and lease charge-offs (recoveries)

 

190

 

122

 

 

(887

)

 

(17

)

 

7,016

$

(592

)

Allowance for credit losses at end of period

$

45,934

$

44,772

 

$

43,793

 

$

42,126

 

$

42,843

$

45,934

 

 

 

 

 

 

 

 

Allowance for Credit Losses - Off-Balance Sheet Exposure

Balance at beginning of period

$

2,751

$

2,796

 

$

2,720

 

$

2,506

 

$

2,192

$

2,506

 

(Credit) provision for credit losses

 

45

 

(45

)

 

76

 

 

214

 

 

314

$

290

 

Allowance for credit losses at end of period

$

2,796

$

2,751

 

$

2,796

 

$

2,720

 

$

2,506

$

2,796

 

Loan Classification - Total Portfolio

 

 

 

 

 

 

Special Mention

$

49,752

$

66,730

$

72,270

$

92,380

$

85,530

$

49,752

Substandard

 

48,537

 

40,007

 

42,756

 

42,722

 

52,047

 

48,537

Ratio Analysis

Credit Quality

 

 

 

 

 

 

Nonperforming loans and leases/total loans and leases

0.62

%

0.67

%

0.57

%

0.60

%

0.61

%

0.62

%

Nonperforming assets/total assets

0.43

%

0.45

%

0.38

%

0.38

%

0.40

%

0.43

%

Allowance for credit losses/total loans and leases

0.87

%

0.86

%

0.85

%

0.83

%

0.84

%

0.87

%

Allowance/nonperforming loans and leases

139.86

%

128.27

%

147.95

%

139.20

%

137.51

%

139.85

%

Net loan and lease losses annualized/total average loans and leases

0.01

%

0.01

%

(0.07

) %

0.00

%

0.55

%

(0.01

) %

Capital Adequacy

 

 

 

 

 

 

Tier 1 Capital (to average assets)

9.34

%

9.14

%

9.02

%

8.89

%

8.72

%

9.34

%

Total Capital (to risk-weighted assets)

14.42

%

14.26

%

14.07

%

14.23

%

14.23

%

14.42

%

Profitability (period-end)

 

 

 

 

 

 

Return on average assets *

1.00

%

1.08

%

1.07

%

1.19

%

0.97

%

1.09

%

Return on average equity *

13.36

%

13.33

%

13.09

%

13.24

%

10.69

%

13.25

%

Net interest margin (TE) *

3.02

%

3.04

%

3.09

%

3.04

%

3.01

%

3.05

%

* Quarterly ratios have been annualized

(1) Average balances and yields on available-for-sale securities are based on historical amortized cost.

(2) Interest income includes the tax effects of taxable-equivalent adjustments using an effective income tax rate of 21% in 2022 and 2021 to increase tax exempt interest income to taxable-equivalent basis.

(3) Nonaccrual loans are included in the average asset totals presented above. Payments received on nonaccrual loans have been recognized as disclosed in Note 1 of the Company's consolidated financial statements included in Part I of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2021.

(4) Earnings per share for the full fiscal year may not equal the sum of the quarterly earnings per share as a result of rounding of average shares.

(5) Amounts in prior periods' financial statements are reclassified when necessary to conform to the current period's presentation.

Contacts

Stephen S. Romaine, President & CEO

Francis M. Fetsko, Executive VP, CFO & COO

Tompkins Financial Corporation (888) 503-5753

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