NBT Bancorp Inc. Announces Record Net Income of $61.7 Million and Organic Loan Growth of 5.3% in 2013; Declares Cash Dividend

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| Source: NBT Bancorp Inc.

NORWICH, N.Y., Jan. 27, 2014 (GLOBE NEWSWIRE) -- NBT Bancorp Inc. (NBT) (Nasdaq:NBTB) reported net income for the year ended December 31, 2013 of $61.7 million, up from $54.6 million from the prior year. 2013 results included the impact of the acquisition of Alliance Financial Corporation ("Alliance") in March 2013, including approximately $12.4 million in merger related expenses. Reported earnings per diluted share for the year ended December 31, 2013 was $1.46 as compared to $1.62 for 2012.

Core net income (excluding merger related expenses, net securities gains, and other items not considered core) for the year ended December 31, 2013 was $69.9 million, up 27.5% from $54.8 million for 2012. Core diluted earnings per share for the year ended December 31, 2013 was $1.65, up from $1.63 for the prior year.

Reported net income for the three months ended December 31, 2013 was $17.9 million, up from $13.1 million for the same period last year. 2013 results included the impact of the aforementioned acquisition of Alliance. Reported diluted earnings per share for the three months ended December 31, 2013 was $0.41, as compared to $0.39 for the same period in 2012.

Core net income (excluding merger related expenses, net securities gains, and other items not considered core) for the three months ended December 31, 2013 was $18.4 million, up 35.2% from $13.6 million for the same period in 2012, due primarily to the impact of the Alliance acquisition. Core diluted earnings per share for the three months ended December 31, 2013 was $0.42, as compared to $0.40 for the same period last year.

2013 Highlights:

  • Significant strategic expansion during 2013:
    -- Acquired Alliance Financial Corporation, a $1.4 billion financial holding company headquartered in Syracuse, N.Y. on March 8, 2013
  • 2013 organic loan growth of 5.3%
    -- Consumer loan growth of 4.8%
    -- Commercial loan growth of 5.5%
  • Net charge-offs to average loans was 0.44% for 2013, down from 0.55% for 2012

"We are extremely proud of the results generated by our team in 2013. We achieved record core earnings and realized strong organic loan growth while maintaining stable asset quality. Strategic initiatives—including the successful acquisition and integration of Alliance, investments in training and technology, and expense control—all contributed to our strong financial results and have our company well-positioned for 2014 and beyond. Ultimately, the engine that drives our success is the talented group of financial professionals we cultivate. While the regulatory and economic environment continues to present challenges, we remain confident in our team and their ability to continue to enhance the long-term value of our company for our shareholders."

Net interest income was $238.1 million for the year ended December 31, 2013, up 16.6% from 2012. This increase from the prior year was due primarily to the 22.7% increase in average earning assets for the year ended December 31, 2013 over the prior year. The acquisition of Alliance in March 2013 as well as the sustained organic loan growth in 2013 contributed to the growth in average earning assets.

NBT's fully tax equivalent ("FTE") net interest margin was 3.66% for the year ended December 31, 2013, down from 3.86% for 2012. Rate compression on earning assets continued to negatively impact net interest margin in 2013 as evidenced by decreasing loan yields from 5.17% for the year ended December 31, 2012 to 4.69% for 2013. In addition, yields on available for sale securities declined 42 bps for the year ended December 31, 2013 as compared to 2012. The rate compression on earning assets was partially offset by the 24 bp decrease in the rates paid on interest bearing liabilities, driven by a more favorable deposit mix and a decrease in deposit rates, in 2013 as compared to the same period in 2012. Further contributing to net interest margin compression during 2013 was the incorporation of Alliance's interest earning assets and interest bearing liabilities into NBT.

Net interest income was $62.1 million for the fourth quarter of 2013, down marginally from the prior quarter, and up $9.6 million from the fourth quarter of 2012 primarily due to the acquisition of Alliance. Average interest earning assets were up $54.4 million, or 0.8%, for the fourth quarter of 2013 as compared to the prior quarter, driven primarily by organic loan production during the fourth quarter. This increase was offset by a decrease in the yields on interest earning assets from 4.08% for the third quarter of 2013 to 4.02% for the fourth quarter, driven primarily by the 9 bp decrease in loan yields. Average interest bearing liabilities increased slightly from the third quarter of 2013 to the fourth quarter. Rates paid on interest bearing liabilities decreased 2 bps during the same period resulting in a 3.0% decrease in interest expense from the third quarter of 2013 to the fourth quarter.

NBT's FTE net interest margin was 3.61% for the three months ended December 31, 2013, down from 3.65% from the prior quarter, and down from 3.83% for the fourth quarter of 2012. Rate compression on earning assets continued to negatively impact net interest margin in the fourth quarter of 2013 as evidenced by decreasing loan yields from 4.63% for the third quarter of 2013 to 4.54% for the fourth quarter of 2013. The rate compression on earning assets was partially offset by the 2 bp decrease in the rates paid on interest bearing liabilities in the fourth quarter of 2013 versus the prior quarter. This decrease was primarily driven by the 2 bp decrease in rates paid on deposits.

Noninterest income for the year ended December 31, 2013 was $103.2 million, up 18.2% from 2012, with the primary drivers being increases in trust revenue and ATM and debit card fees driven primarily by the acquisition of Alliance. In addition, NBT experienced a 9.2% increase in insurance and financial services revenue for the year ended December 31, 2013 as compared to 2012, due primarily to a $1.0 million, or 6.0%, increase in insurance revenue as well as a $1.0 million, or 19.5%, increase in financial services revenue. Retirement plan administration fees were also up $1.4 million, or 13.9% for the year ended December 31, 2013 as compared to 2012 due to growth in new business during 2013.

Noninterest income for the three months ended December 31, 2013 was $25.3 million, down 6.8% from the prior quarter, and up 15.2% from the fourth quarter of 2012 which was due primarily to the acquisition of Alliance. The decrease from the prior quarter was driven primarily by other noninterest income, which decreased $1.3 million from the prior quarter. Decreases in loan fees collected and swap fees recognized during the fourth quarter were the main drivers. In addition, NBT recorded $0.3 million in securities gains during the third quarter, as compared to nominal securities gains recorded for the fourth quarter of 2013.     

Noninterest expense for the year ended December 31, 2013 was $228.9 million, up $35.0 million or 18.1%, from 2012. Excluding merger expenses totaling $12.4 million and $2.6 million for the years ended December 31, 2013 and 2012, respectively, noninterest expense was up $25.3 million, or 13.2%, for 2013 as compared to 2012. Several noninterest expense categories were affected by the acquisition of Alliance in March 2013 and the full year impact of the June 2012 acquisition of Hampshire First Bank, with salaries and employee benefits and occupancy expenses being the primary drivers of the increase. Income tax expense for the year ended December 31, 2013 was $28.2 million, up from $22.8 million from 2012 due primarily to the increase in pre-tax income for 2013 and an increase in the effective tax rate to 31.3% for the year ended December 31, 2013 as compared with 29.5% for 2012.

Noninterest expense for the three months ended December 31, 2013 was $55.5 million, down 1.4% from the prior quarter, and up 14.2% from the fourth quarter of 2012 primarily due to the acquisition of Alliance. Excluding merger expenses totaling $0.1 million and $0.3 million during the fourth quarter and third quarter of 2013, respectively, noninterest expense was down $0.6 million, or 1.0%, for the fourth quarter of 2013 as compared to the prior quarter. Income tax expense for the three month period ended December 31, 2013 was $8.8 million, up slightly from $8.6 million from the prior quarter, and up from $5.8 million for the fourth quarter of 2012. The increase from the fourth quarter of 2012 is due primarily to the increase in pre-tax income during the fourth quarter of 2013 over the fourth quarter of 2012.  The effective tax rate was 32.9% for the fourth quarter and 31.0% for the third quarter of 2013.

Asset Quality

Net charge-offs were $22.3 million for the year ended December 31, 2013, equivalent to the year ended December 31, 2012. Net charge-offs to average loans for the year ended December 31, 2013 was 0.44%, compared to 0.55% for last year. NBT recorded a provision for loan losses of $22.4 million for the year ended December 31, 2013, compared with $20.3 million for 2012. This increase was due primarily to strong organic loan growth during 2013. 

Net charge-offs were $5.9 million for the three months ended December 31, 2013, down from $6.2 million for the prior quarter, and down from $8.3 million from the three months ended December 31, 2012. NBT recorded a provision for loan losses of $5.2 million for the three months ended December 31, 2013, equivalent to the prior quarter, and $6.9 million for the fourth quarter of 2012.     

Nonperforming loans to total loans was 0.99% at December 31, 2013, up 16 bps from the prior quarter, and up from 0.98% at December 31, 2012. The increase from the prior quarter was due to an increase in commercial nonaccrual loans, driven primarily by one commercial relationship. Past due loans as a percentage of total loans were 0.77% for the fourth quarter as compared to 0.70% for the third quarter of 2013, and 0.71% as of December 31, 2012.   

The allowance for loan losses totaled $69.4 million at December 31, 2013, compared to $70.2 million at September 30, 2013 and $69.3 million at December 31, 2012. The allowance for loan losses as a percentage of loans was 1.28% (1.55% excluding acquired loans with no related allowance recorded) at December 31, 2013, compared to 1.31% (1.60% excluding acquired loans with no related allowance recorded) at September 30, 2013 and 1.62% (1.72% excluding acquired loans with no related allowance recorded) at December 31, 2012.     

Balance Sheet

Total assets were $7.7 billion at December 31, 2013, up $1.6 billion (approximately $1.4 billion from Alliance acquisition) or 26.6% from December 31, 2012. Loans were $5.4 billion at December 31, 2013, up $1.1 billion from December 31, 2012, primarily due to approximately $904 million from the Alliance acquisition coupled with strong organic loan growth during 2013. Total deposits were $5.9 billion at December 31, 2013, up $1.1 billion from December 31, 2012, primarily due to the Alliance acquisition. Stockholders' equity was $816.6 million, representing a total equity-to-total assets ratio of 10.67% at December 31, 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 which expired on December 31, 2013, NBT purchased 584,925 shares of its common stock during the twelve month period ended December 31, 2013, for a total of $12.5 million at an average price of $21.30 per share. At December 31, 2013, there were 1,000,000 shares available for repurchase under a previously announced plan, which expires on December 31, 2014.  

Dividend

The NBT Board of Directors declared a 2014 first-quarter cash dividend of $0.21 per share at a meeting held today.  The dividend will be paid on March 14, 2014 to shareholders of record as of March 1, 2014.

Corporate Overview

NBT Bancorp Inc. is a financial holding company headquartered in Norwich, N.Y., with total assets of $7.7 billion at December 31, 2013.  The company primarily operates through NBT Bank, N.A., a full-service community bank with two geographic divisions, and through two financial services companies.  NBT Bank, N.A. has 157 locations, including 125 NBT Bank offices in upstate New York, northwestern Vermont, western Massachusetts, and southern New Hampshire. NBT's Pennstar Bank division operates from 32 Pennstar Bank offices in northeastern Pennsylvania. 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.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; and (7) adverse changes may occur in the securities markets or with respect to inflation.  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 NBT's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of NBT.

NBT Bancorp Inc. and Subsidiaries
SELECTED FINANCIAL DATA
(unaudited, dollars in thousands except per share data)
           
  2013 2012
  4th Q 3rd Q 2nd Q 1st Q 4th Q
Reconciliation of Non-GAAP Financial Measures:          
Reported net income (GAAP) $17,925 $19,257 $16,916 $7,649 $13,116
Adj: (Gain) / Loss on sale of securities, net (net of tax) (9) (228) 42 (795) (15)
Adj: Other adjustments (net of tax) (1)   402  110  --   --   -- 
Plus: Merger related expenses (net of tax) 59 224 882 7,423 496
Total Adjustments 452 106 924 6,628 481
Core net income $18,377 $19,363 $17,840 $14,277 $13,597
           
Profitability:          
Core Diluted Earnings Per Share $0.42 $0.44 $0.40 $0.39 $0.40
Diluted Earnings Per Share $0.41 $0.44 $0.38 $0.21 $0.39
Weighted Average Diluted Common Shares Outstanding 44,121,102 44,135,114 44,316,531 36,794,356 33,987,465
Core Return on Average Assets (2) 0.96% 1.02% 0.95% 0.90% 0.89%
Return on Average Assets (2) 0.94% 1.01% 0.90% 0.48% 0.86%
Core Return on Average Equity (2) 9.04% 9.67% 8.88% 9.01% 9.34%
Return on Average Equity (2) 8.81% 9.62% 8.42% 4.83% 9.01%
Core Return on Average Tangible Common Equity (2)(4) 14.77% 15.95% 14.57% 13.58% 13.71%
Return on Average Tangible Common Equity (2)(4) 14.42% 15.86% 13.85% 7.49% 13.25%
Net Interest Margin (2)(3) 3.61% 3.65% 3.69% 3.68% 3.83%
           
Twelve Months Ended December 31,          
           
Reconciliation of Non-GAAP Financial Measures: 2013 2012      
Reported net income (GAAP) $61,747 $54,558      
Adj: (Gain) / Loss on sale of securities, net (net of tax)  (990)  (421)      
Adj: Other adjustments (net of tax) (6)   512  (382)      
Plus: Merger related expenses (net of tax)  8,588  1,836      
Reversal of uncertain tax position  --   (790)      
Total Adjustments 8,110 243      
Core net income $69,857 $54,801      
           
Profitability:          
Core Diluted Earnings Per Share $1.65 $1.63      
Diluted Earnings Per Share $1.46 $1.62      
Weighted Average Diluted Common Shares Outstanding 42,350,580 33,718,718      
Core Return on Average Assets 0.96% 0.93%      
Return on Average Assets 0.85% 0.93%      
Core Return on Average Equity 9.16% 9.77%      
Return on Average Equity 8.09% 9.72%      
Core Return on Average Tangible Common Equity (5) 14.76% 14.20%      
Return on Average Tangible Common Equity (5) 13.11% 14.14%      
Net Interest Margin (3) 3.66% 3.86%      
           
(1) Primarily reorganization expenses for 2013 and a write-down of an other asset for 2012 
(2) Annualized
(3) Calculated on a Fully Tax Equivalent ("FTE")
(4) Excludes amortization of intangible assets (net of tax) from net income and average tangible common equity is calculated as follows:
           
  2013 2012
  4th Q 3rd Q 2nd Q 1st Q 4th Q
Average stockholders' equity  $ 806,791  $ 794,273  $ 806,200  $ 642,693  $ 579,211
Less: average goodwill and other intangibles  291,659  292,271  292,775  200,779  169,612
Average tangible common equity  $ 515,132  $ 502,002  $ 513,425  $ 441,914  $ 409,599
           
(5) Excludes amortization of intangible assets (net of tax) from net income and average tangible common equity is calculated as follows:
           
   12 Months ended December 31,       
  2013 2012      
Average stockholders' equity  $ 763,026  $ 555,182      
Less: average goodwill and other intangibles  269,683  158,035      
Average tangible common equity  $ 493,343  $ 397,147      
           
(6) Reorganization expenses for 2013; prepayment penalty income and flood insurance recoveries, partially offset by an other asset write-down for 2012
           
           
NBT Bancorp Inc. and Subsidiaries
SELECTED FINANCIAL DATA
(unaudited, dollars in thousands except per share data)
           
  2013 2012
  4th Q 3rd Q 2nd Q 1st Q 4th Q
Balance Sheet Data:          
Securities Available for Sale $1,364,881 $1,385,734 $1,390,403 $1,465,791 $1,147,999
Securities Held to Maturity  117,283  118,259  122,302  62,474  60,563
Net Loans  5,337,361  5,297,047  5,219,526  5,126,299  4,208,282
Total Assets  7,652,175  7,668,903  7,534,518  7,610,831  6,042,259
Total Deposits  5,890,224  6,003,138  5,878,176  6,015,963  4,784,349
Total Borrowings  866,061  783,439  795,918  715,728  605,855
Total Liabilities  6,835,606  6,873,344  6,742,943  6,807,536  5,459,986
Stockholders' Equity  816,569  795,559  791,575  803,295  582,273
           
Asset Quality:          
Nonaccrual Loans $49,965 $41,418 $40,525 $41,726 $39,676
90 Days Past Due and Still Accruing  3,737  3,286  2,004  1,651  2,448
Total Nonperforming Loans  53,702  44,704  42,529  43,377  42,124
Other Real Estate Owned  2,904  3,626  3,757  2,864  2,276
Total Nonperforming Assets  56,606  48,330  46,286  46,241  44,400
Allowance for Loan Losses  69,434  70,184  71,184  68,734  69,334
Allowance for Loan Losses to Total Originated Loans (1) 1.55% 1.60% 1.68% 1.69% 1.72%
Allowance for Loan Losses to Total Loans 1.28% 1.31% 1.35% 1.32% 1.62%
Total Nonperforming Loans to Total Loans 0.99% 0.83% 0.80% 0.83% 0.98%
Total Nonperforming Assets to Total Assets 0.74% 0.63% 0.61% 0.61% 0.73%
Past Due Loans to Total Loans 0.77% 0.70% 0.71% 0.81% 0.71%
Allowance for Loan Losses to Total Nonperforming Loans 129.29% 157.00% 167.38% 158.46% 164.60%
Net Charge-Offs to Average Loans (4) 0.44% 0.46% 0.30% 0.56% 0.78%
           
Capital:          
Equity to Assets 10.67% 10.37% 10.51% 10.55% 9.64%
Book Value Per Share $18.77 $18.38 $18.18 $18.36 $17.24
Tangible Book Value Per Share (2) $12.09 $11.64 $11.46 $11.67 $12.23
Tier 1 Leverage Ratio (3) 8.93% 8.79% 8.72% 10.25% 8.54%
Tier 1 Capital Ratio 11.74% 11.46% 11.20% 11.33% 11.00%
Total Risk-Based Capital Ratio 12.99% 12.71% 12.45% 12.58% 12.25%
Common Stock Price (End of Period) $25.90 $22.98 $21.17 $22.15 $20.27
           
(1) Excludes acquired loans with no related allowance recorded
(2) Stockholders' equity less goodwill and intangible assets divided by common shares outstanding
(3) The Tier 1 Leverage Ratio for the first quarter of 2013 was impacted by timing of the acquisition of Alliance on March 8, 2013
(4) Annualized
 
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)
     
  December 31, December 31,
ASSETS 2013 2012
Cash and due from banks  $ 157,625  $ 157,094
Short term interest bearing accounts  1,301  6,574
Securities available for sale, at fair value   1,364,881  1,147,999
Securities held to maturity (fair value of $113,276 and $61,535 at December 31, 2013 and 2012, respectively)  117,283  60,563
Trading securities  5,779  3,918
Federal Reserve and Federal Home Loan Bank stock  46,864  29,920
Loans  5,406,795  4,277,616
Less allowance for loan losses  69,434  69,334
 Net loans  5,337,361 4,208,282
Premises and equipment, net  88,327  77,875
Goodwill  264,997  152,373
Intangible assets, net  25,557  16,962
Bank owned life insurance  114,966  80,702
Other assets  127,234  99,997
TOTAL ASSETS  $ 7,652,175  $ 6,042,259
     
LIABILITIES AND STOCKHOLDERS' EQUITY    
Deposits:    
 Demand (noninterest bearing)  $ 1,645,641  $ 1,242,712
 Savings, NOW, and money market  3,223,441  2,558,376
 Time  1,021,142  983,261
 Total deposits 5,890,224 4,784,349
Short-term borrowings  456,042  162,941
Long-term debt  308,823  367,492
Junior subordinated debt  101,196  75,422
Other liabilities  79,321  69,782
 Total liabilities 6,835,606 5,459,986
     
Total stockholders' equity  816,569  582,273
     
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY  $ 7,652,175  $ 6,042,259
     
 
NBT Bancorp Inc. and Subsidiaries 
CONSOLIDATED STATEMENTS OF INCOME
(unaudited, dollars in thousands except per share data)
         
  Three Months Ended Twelve Months Ended
  December 31, December 31,
  2013 2012 2013 2012
Interest, fee and dividend income:        
Loans  $ 61,173  $ 53,924  $ 238,672  $ 208,458
Securities available for sale 6,707  5,981  25,510  27,005
Securities held to maturity 783  549  2,660  2,378
Other 518  403  1,881  1,556
 Total interest, fee and dividend income  69,181  60,857  268,723  239,397
Interest expense:        
Deposits 3,845  4,327  16,290  18,848
Short-term borrowings 174  39  515  188
Long-term debt 2,559  3,627  11,755  14,428
Trust preferred debt 545  411  2,084  1,730
 Total interest expense  7,123  8,404  30,644  35,194
Net interest income  62,058  52,453  238,079  204,203
Provision for loan losses 5,166  6,940  22,424  20,269
 Net interest income after provision for loan losses  56,892  45,513  215,655  183,934
Noninterest income:        
Insurance and other financial services revenue 5,761  5,363  24,447  22,387
Service charges on deposit accounts 4,996  4,687  19,307  18,225
ATM and debit card fees 3,996  2,955  15,558  12,358
Retirement plan administration fees 2,796  2,635  11,497  10,097
Trust 4,725  2,489  16,682  9,172
Bank owned life insurance income 1,145  849  3,793  3,077
Net securities gains 13  21  1,426  599
Other 1,870  2,963  10,505  11,412
 Total noninterest income  25,302  21,962  103,215  87,327
Noninterest expense:        
Salaries and employee benefits 28,106  26,457  113,580  104,815
Occupancy 5,262  4,265  20,720  17,415
Data processing and communications 3,985  3,396  15,353  13,437
Professional fees and outside services 3,969  2,615  13,309  10,463
Equipment 3,013  2,403  11,493  9,627
Office supplies and postage 1,677  1,647  6,563  6,489
FDIC expenses  1,272  1,020  4,960  3,832
Advertising  759  581  3,204  2,889
Amortization of intangible assets 1,324  864  4,872  3,394
Loan collection and other real estate owned 594  509  2,619  2,560
Merger related  88  713  12,364  2,608
Other operating 5,437  4,122  19,890  16,358
 Total noninterest expense 55,486 48,592 228,927 193,887
Income before income taxes 26,708 18,883 89,943 77,374
Income taxes 8,783  5,767  28,196  22,816
 Net income  $ 17,925  $ 13,116  $ 61,747  $ 54,558
Earnings Per Share:        
 Basic  $ 0.41  $ 0.39  $ 1.47  $ 1.63
 Diluted  $ 0.41  $ 0.39  $ 1.46  $ 1.62
         
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
  4th Q 3rd Q 2nd Q 1st Q 4th Q
Interest, fee and dividend income:          
Loans  $ 61,173  $ 61,773  $ 62,031  $ 53,695  $ 53,924
Securities available for sale 6,707 6,520 6,537 5,746 5,981
Securities held to maturity 783 804 548 525 549
Other 518 472 488 403 403
 Total interest, fee and dividend income 69,181 69,569 69,604 60,369 60,857
Interest expense:          
Deposits 3,845 3,999 4,296 4,150 4,327
Short-term borrowings 174 232 67 42 39
Long-term debt 2,559 2,561 3,026 3,609 3,627
Junior subordinated debt 545 551 560 428 411
 Total interest expense 7,123 7,343 7,949 8,229 8,404
Net interest income 62,058 62,226 61,655 52,140 52,453
Provision for loan losses 5,166 5,198 6,402 5,658 6,940
 Net interest income after provision for loan losses 56,892 57,028 55,253 46,482 45,513
Noninterest income:          
Insurance and other financial services revenue 5,761 6,038 5,755 6,893 5,363
Service charges on deposit accounts 4,996 5,055 4,933 4,323 4,687
ATM and debit card fees 3,996 4,276 4,044 3,242 2,955
Retirement plan administration fees 2,796 3,062 2,957 2,682 2,635
Trust  4,725 4,345 4,699 2,913 2,489
Bank owned life insurance income 1,145 913 886 849 849
Net securities gains (losses) 13 329 (61) 1,145 21
Other 1,870 3,129 2,324 3,182 2,963
 Total noninterest income 25,302 27,147 25,537 25,229 21,962
Noninterest expense:          
Salaries and employee benefits 28,106 29,267 29,160 27,047 26,457
Occupancy 5,262 5,262 5,219 4,977 4,265
Data processing and communications 3,985 4,059 3,854 3,455 3,396
Professional fees and outside services 3,969 3,202 3,237 2,901 2,615
Equipment 3,013 2,988 2,910 2,582 2,403
Office supplies and postage 1,677 1,640 1,656 1,590 1,647
FDIC expenses 1,272 1,285 1,273 1,130 1,020
Advertising 759 722 1,000 723 581
Amortization of intangible assets 1,324 1,346 1,351 851 864
Loan collection and other real estate owned 594 886 421 718 509
Merger 88 326 1,269 10,681 713
Other operating 5,437 5,303 5,100 4,050 4,122
 Total noninterest expense 55,486 56,286 56,450 60,705 48,592
Income before income taxes 26,708 27,889 24,340 11,006 18,883
Income taxes 8,783 8,632 7,424 3,357 5,767
 Net income   $ 17,925  $ 19,257  $ 16,916  $ 7,649  $ 13,116
Earnings per share:          
 Basic  $ 0.41  $ 0.44  $ 0.39  $ 0.21  $ 0.39
 Diluted  $ 0.41  $ 0.44  $ 0.38  $ 0.21  $ 0.39
           
Note: Year-to-date (YTD) EPS may not equal sum of quarters due to share count differences.
 
 
NBT Bancorp Inc. and Subsidiaries
AVERAGE QUARTERLY BALANCE SHEETS
(unaudited, dollars in thousands)
  Average Yield / Average Yield / Average Yield / Average Yield / Average Yield /
  Balance Rates Balance Rates Balance Rates Balance Rates Balance Rates
  Q4 - 2013 Q3 - 2013 Q2 - 2013 Q1 - 2013 Q4 - 2012
ASSETS:                    
Short-term interest bearing accounts  $ 4,798 0.81%  $ 1,955 1.73%  $ 41,313 0.57%  $ 75,110 0.21%  $ 72,660 0.26%
Securities available for sale (1)(2)  1,383,273 2.05%  1,387,714 2.00%  1,428,864 1.97%  1,197,238 2.09%  1,123,110 2.27%
Securities held to maturity (1)   117,574 3.47%  118,781 3.54%  62,463 5.23%  52,905 6.06%  60,651 5.42%
Investment in FRB and FHLB Banks  41,115 4.92%  43,895 4.20%  35,497 4.85%  31,312 4.75%  29,801 4.75%
Loans (3)  5,369,474 4.54%  5,309,446 4.63%  5,243,534 4.76%  4,492,106 4.87%  4,264,680 5.05%
 Total interest earning assets  $ 6,916,234 4.02%  $ 6,861,791 4.08%  $ 6,811,671 4.16%  $ 5,848,671 4.25%  $ 5,550,902 4.43%
Other assets  680,435    671,482    705,869    554,355    503,124  
Total assets  $ 7,596,669    $ 7,533,273    $ 7,517,540    $ 6,403,026    $ 6,054,026  
                     
LIABILITIES AND STOCKHOLDERS' EQUITY:                    
Money market deposit accounts $1,419,458 0.15% $1,360,067 0.15% $1,402,429 0.15% $1,190,555 0.14% $1,149,248 0.14%
NOW deposit accounts  925,544 0.13%  877,387 0.13%  927,037 0.19%  799,219 0.23%  752,737 0.25%
Savings deposits  973,650 0.08%  984,093 0.09%  983,413 0.09%  770,559 0.08%  694,226 0.08%
Time deposits  1,042,710 1.07%  1,081,549 1.09%  1,136,511 1.10%  1,015,711 1.26%  1,006,581 1.31%
 Total interest bearing deposits  $ 4,361,362 0.35%  $ 4,303,096 0.37%  $ 4,449,390 0.39%  $ 3,776,044 0.45%  $ 3,602,792 0.48%
Short-term borrowings  338,476 0.20%  383,238 0.24%  229,906 0.12%  168,783 0.10%  150,372 0.10%
Junior subordinated debentures  101,196 2.14%  101,196 2.16%  101,196 2.22%  82,295 2.11%  75,422 2.17%
Long-term debt  308,969 3.29%  309,069 3.29%  355,702 3.41%  382,177 3.83%  367,312 3.93%
 Total interest bearing liabilities  $ 5,110,003 0.55%  $ 5,096,599 0.57%  $ 5,136,194 0.62%  $ 4,409,299 0.76%  $ 4,195,898 0.80%
Demand deposits  1,595,145    1,559,506    1,496,486    1,283,737    1,210,440  
Other liabilities  84,730    82,896    78,660    67,297    68,477  
Stockholders' equity  806,791    794,272    806,200    642,693    579,211  
Total liabilities and stockholders' equity  $ 7,596,669    $ 7,533,273    $ 7,517,540    $ 6,403,026    $ 6,054,026  
                     
Interest rate spread   3.47%   3.51%   3.54%   3.49%   3.63%
Net interest margin   3.61%   3.65%   3.69%   3.68%   3.83%
                     
(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
AVERAGE YEAR-END BALANCE SHEETS
(unaudited, dollars in thousands)
  Average   Yield/ Average   Yield/
  Balance Interest Rates  Balance Interest Rates 
 Twelve Months ended December 31,  2013 2012
ASSETS:            
Short-term interest bearing accounts $30,522 $116 0.38% $66,207 $179 0.27%
Securities available for sale (1)(2)  1,349,887  27,357 2.03%  1,177,969  28,904 2.45%
Securities held to maturity (1)   88,193  3,692 4.19%  65,582  3,583 5.46%
Investment in FRB and FHLB Banks  37,998  1,771 4.66%  28,358  1,378 4.86%
Loans and leases (3)  5,106,607  239,572 4.69%  4,053,420  209,370 5.17%
 Total interest earning assets  $ 6,613,207  $ 272,508 4.12%  $ 5,391,536  $ 243,414 4.51%
Other assets  653,432      483,248    
Total assets  $ 7,266,639      $ 5,874,784    
             
LIABILITIES AND STOCKHOLDERS' EQUITY:            
Money market deposit accounts $1,343,801  2,004 0.15% $1,116,583  $ 2,054 0.18%
NOW deposit accounts  882,629  1,468 0.17%  709,889  1,854 0.26%
Savings deposits  929,226  789 0.08%  680,092  522 0.08%
Time deposits  1,069,228  12,029 1.13%  993,117  14,418 1.45%
 Total interest bearing deposits  $ 4,224,884  $ 16,290 0.39%  $ 3,499,681  $ 18,848 0.54%
Short-term borrowings  280,848  515 0.18%  165,742  188 0.11%
Trust preferred debentures  96,536  2,084 2.16%  75,422  1,730 2.29%
Long-term debt  338,697  11,755 3.47%  368,270  14,428 3.92%
 Total interest bearing liabilities  $ 4,940,965  $ 30,644 0.62%  $ 4,109,115  $ 35,194 0.86%
Demand deposits  1,484,193      1,139,896    
Other liabilities  78,455      64,551    
Stockholders' equity  763,026      561,222    
Total liabilities and stockholders' equity  $ 7,266,639      $ 5,874,784    
 Net interest income (FTE)    241,864      208,220  
Interest rate spread     3.50%     3.65%
Net interest margin     3.66%     3.86%
Taxable equivalent adjustment     3,785      4,017  
Net interest income    $ 238,079      $ 204,203  
             
(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 
  4th Q 3rd Q 2nd Q 1st Q 4th Q Balances *
Residential real estate mortgages  $ 1,041,637  $ 1,028,158  $ 1,001,642  $ 996,925  $ 651,107  $ 333,105
Commercial  859,026  849,095  867,513  829,766  694,799  179,672
Commercial real estate mortgages  1,328,313  1,302,978  1,241,271  1,233,763  1,072,807  117,752
Real estate construction and development  93,247  116,662  152,548  136,402  123,078  -- 
Agricultural and agricultural real estate mortgages  112,035  110,113  107,565  107,023  112,687  -- 
Consumer  1,352,638  1,327,203  1,284,888  1,253,645  1,047,856  200,470
Home equity  619,899  633,022  635,283  637,509  575,282  73,474
 Total loans  $ 5,406,795  $ 5,367,231  $ 5,290,710  $ 5,195,033  $ 4,277,616  $ 904,473
             
* Balances are as of Alliance acquisition date of March 8, 2013
Martin A. Dietrich, CEO
Michael J. Chewens, CFO
NBT Bancorp Inc.
52 South Broad Street
Norwich, NY 13815
607-337-6119