Tompkins Financial Corporation Reports Record Quarterly and Annual Earnings

By: Tompkins Financial Corporation via Business Wire News Releases

January 24, 2014 at 09:00 AM EST

Tompkins Financial Corporation (TMP–NYSE MKT LLC)

Tompkins Financial Corporation reported diluted earnings per share of $0.96 for the fourth quarter of 2013, representing the highest quarterly earnings in Company history. Year-to-date earnings were also at a record level, with diluted earnings per share of $3.46 for the year ended December 31, 2013, up from $2.43 per share reported for the same period in 2012.

Both current and prior period results were impacted by certain non-recurring items including, but not limited to, merger related expenses associated with the acquisition of VIST Financial Corporation completed on August 1, 2012. After adjusting for non-recurring income and expenses, quarter-to-date diluted earnings per share would have been $0.91 for the fourth quarter of 2013, up from $0.81 for the same period last year. On a year-to-date basis, adjusting for non-recurring items, diluted earnings per share would have been $3.36 for the year ended December 31, 2013, compared to $3.17 for the same period last year. Additional information on non-recurring adjustments to earnings per share is included in the non-GAAP disclosure tables included in this press release.

President and CEO, Stephen S. Romaine said “We are proud to report on another record year of earnings performance for Tompkins. 2013 was a rewarding year, as it was our first full year with operations in Pennsylvania. Business activity from our Pennsylvania franchise contributed to our record performance, as did the solid performance from our New York based Banking, Insurance and Wealth Management businesses. We finished the quarter with positive trends in most business areas, leaving us well positioned as we head into 2014.”

SELECTED HIGHLIGHTS FOR THE FOURTH QUARTER INCLUDED:

Record quarter and year-to-date earnings per share
Annual cash dividends per share increased by 5.2% in 2013, representing the 25th consecutive year of increased dividends
Net interest income improved during the quarter as margin increased for the third consecutive quarter, aided by solid growth in loans (up 8.1% YTD) and noninterest-bearing deposits (up 7.1% YTD)
Provision expense was lower for the current quarter, benefiting from $977,000 of net recoveries during the quarter, as gross recoveries of $3.1 million exceeded gross charge-offs of $2.1 million
Credit Quality improved, with nonperforming assets down 12.4% during the quarter, and 2.5% from year end 2012
Fee based revenue from insurance, investment services, service charges on deposits and card services were all up from the same period last year

A more detailed summary of financial performance is included below. Year-to-date growth percentages are impacted by a full year consolidation of the operations of VIST Financial in 2013, versus five months in 2012.

NET INTEREST INCOME

Net interest income of $42.6 million for the fourth quarter of 2013 represents an increase of 1.9% over the same quarter last year, and 5.3%, from the third quarter of 2013. The net interest margin for the fourth quarter of 2013 was 3.78%, compared to 3.83% for the fourth quarter of 2012, and 3.63% for the third quarter in 2013. Improvement in the current period, compared to the third quarter of 2013 benefited from loan prepayment income, interest related to the payoff of a nonaccrual loan, and growth in average loans and noninterest-bearing deposits.

For the year to date period, net interest income of $161.1 million reflects an increase of 20.1% over the same period in 2012.

NONINTEREST INCOME

Noninterest income was $17.4 million for the fourth quarter of 2013, up 11.7% over the same period in 2012, and down 5.9% from the third quarter of 2013. For the year to date period, noninterest income of $69.9 million represented 30.3% of total revenue, compared to 29.0% for the same period in 2012.

Trends in key fee income business areas in the fourth quarter of 2013 compare favorably to the same quarter last year. Insurance revenue was up 1.5%, Investment Services Income was up 2.4%, deposit fees were up 11.2%, and card services revenue was up 22.4%. The decline in noninterest income from the most recent prior quarter is primarily due to net losses on sale of loans of $345,000 in the fourth quarter of 2013, compared to net gains on loans sales of $115,000 in the third quarter of 2013. The current period noninterest income benefited from a $1.3 million gain associated with certain deposit accounts that converted to alternative products during the quarter. Year-to-date other income results in 2013 also benefited from a $1.4 million pre-tax gain on redemption of the Trust Preferred debenture in September of 2013.

NONINTEREST EXPENSE

Noninterest expense was $40.3 million in the fourth quarter of 2013, up 5.4% from the same period in 2012, and 7.2% compared to the third quarter of 2013. The increase over prior periods is mainly due to higher salary and benefit expenses.

ASSET QUALITY

Asset quality trends improved in nearly all categories during the quarter. Substandard and Special Mention loans declined by $18.1 million from the most recent previous quarter, and by $43.7 million from year end 2012. Net charge-offs were $2.8 million for the year ended December 31, 2013, compared to $11.8 million of net charge-offs for the same period in 2012. The fourth quarter of 2013 saw net recoveries of $977,000, compared to net charge-offs of $7.6 million in the fourth quarter of 2012. The percentage of nonperforming assets to total assets dropped to 0.87%, down from 1.00% at September 30, 2013, and 0.92% at year-end 2012. This nonperforming asset ratio continues to compare favorably to the most recent peer averages of 1.52% published as of September 30, 2013, by the Federal Reserve1.

The Company’s allowance for originated loan and lease losses totaled $26.7 million at December 31, 2013, which represented 1.06% of total originated loans, compared to 1.16% at December 31, 2012, reflecting improved overall quality of the originated portfolio. The allowance for loan and lease losses covered 71.65% of nonperforming loans and leases as of December 31, 2013, which compares to 62.34% as of December 31, 2012.

Several banks reported losses on the sale of trust preferred securities in the fourth quarter of 2013 due to initial indications that these securities would be deemed impermissible investments under the Volcker Rule. Tompkins did not invest in pooled trust preferred securities covered by this rule and therefore was not impacted by the Volcker Rule interpretations on pooled trust preferred securities.

CAPITAL POSITION

Capital ratios remain well above the regulatory well capitalized minimums and showed improving trends over the course of the most recent quarter and over the last 12 months. Tier 1 capital to average assets improved for the fourth consecutive quarter, to 8.52% at December 31, 2013. Total risk based capital of 13.42% was up modestly from the third quarter of 2013. Tangible book value per share was $23.70 at December 31, 2013, up from $22.82 at September 30, 2013. The improvement in capital ratios was primarily driven by growth in retained earnings. Refer to Non-GAAP disclosure for additional details on tangible book value per share.

ABOUT TOMPKINS FINANCIAL CORPORATION

Tompkins Financial Corporation is a 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 Trust Company, The Bank of Castile, Mahopac Bank, VIST Bank, Tompkins Insurance Agencies, Inc., and offers wealth management services through Tompkins Financial Advisors. For more information on Tompkins Financial, visit www.tompkinsfinancial.com.

NON-GAAP MEASURES

This press release contains financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (GAAP). Where non-GAAP disclosures are used in this press release, the comparable GAAP measure, as well as reconciliation to the comparable GAAP measure, is provided in the accompanying tables. Management believes that these non-GAAP measures provide useful information. Non-GAAP measures should not be considered a substitute for financial measures determined in accordance with GAAP and investors should consider the Company’s performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. See “Tompkins Financial Corporation - Summary Financial Data (Unaudited)” tables for Non-GAAP related calculations.

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

This press release may include forward-looking statements with respect to revenue sources, growth, market risk, and corporate objectives. The Company assumes no duty, and specifically disclaims any obligation, to update forward-looking statements, and cautions that these statements are subject to numerous assumptions, risks, and uncertainties, all of which could change over time. Actual results could differ materially from forward-looking statements.


TOMPKINS FINANCIAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION

(In thousands, except share and per share data) (Unaudited)		As of			As of
ASSETS		12/31/2013			12/31/2012

Cash and noninterest bearing balances due from banks	$	82,163		$	117,448
Interest bearing balances due from banks		721			1,482
Cash and Cash Equivalents		82,884			118,930

Trading securities, at fair value		10,991			16,450
Available-for-sale securities, at fair value (amortized cost of $1,368,736 at December 31, 2013 and $1,349,416 at December 31, 2012)		1,354,811			1,393,340
Held-to-maturity securities, fair value of $19,625 at December 31, 2013, and $25,163 at December 31, 2012		18,980			24,062
Originated loans and leases, net of unearned income and deferred costs and fees		2,527,244			2,133,106
Acquired loans and leases, covered		25,868			37,600
Acquired loans and leases, non-covered		641,172			783,904
Less: Allowance for loan and lease losses		27,970			24,643
Net Loans and Leases		3,166,314			2,929,967

FDIC Indemnification Asset		4,790			4,385
Federal Home Loan Bank stock and Federal Reserve Bank stock		25,041			19,388
Bank premises and equipment, net		55,932			54,581
Corporate owned life insurance		69,335			65,102
Goodwill		92,140			92,305
Other intangible assets, net		16,298			18,643
Accrued interest and other assets		105,523			100,044
Total Assets	$	5,003,039		$	4,837,197

LIABILITIES
Deposits:
Interest bearing:
Checking, savings and money market		2,190,616			2,144,367
Time		865,702			973,883
Noninterest bearing		890,898			831,919
Total Deposits		3,947,216			3,950,169

Federal funds purchased and securities sold under agreements to repurchase		167,724			213,973
Other borrowings, including certain amounts at fair value of $11,292 at December 31, 2013 and $11,847 at December 31, 2012		331,531			111,848
Trust preferred debentures		37,169			43,668
Other liabilities		61,460			76,179
Total Liabilities	$	4,545,100		$	4,395,837

EQUITY
Tompkins Financial Corporation shareholders' equity:
Common Stock - par value $.10 per share: Authorized 25,000,000 shares; Issued:
14,785,007 at December 31, 2013; and 14,426,711 at December 31, 2012		1,479			1,443
Additional paid-in capital		346,096			334,649
Retained earnings		137,102			108,709
Accumulated other comprehensive loss		(25,119	)		(2,106	)
Treasury stock, at cost – 105,449 shares at December 31, 2013, and 100,054 shares at December 31, 2012		(3,071	)		(2,787	)

Total Tompkins Financial Corporation Shareholders’ Equity		456,487			439,908
Noncontrolling interests		1,452			1,452
Total Equity	$	457,939		$	441,360
Total Liabilities and Equity	$	5,003,039		$	4,837,197


TOMPKINS FINANCIAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
		Three Months Ended						Twelve Months Ended
(In thousands, except per share data) (Unaudited)		12/31/2013			12/31/2012			12/31/2013			12/31/2012
INTEREST AND DIVIDEND INCOME
Loans	$	39,684		$	39,952		$	151,711		$	124,662
Due from banks		1			19			10			32
Federal funds sold		0			0			0			2
Trading securities		117			175			589			744
Available-for-sale securities		8,138			8,214			31,360			31,232
Held-to-maturity securities		157			203			685			860
Federal Home Loan Bank stock and Federal Reserve Bank stock		211			205			749			824
Total Interest and Dividend Income		48,308			48,768			185,104			158,356
INTEREST EXPENSE
Time certificates of deposits of $100,000 or more		1,181			825			4,832			3,322
Other deposits		1,841			2,980			7,933			8,910
Federal funds purchased and securities sold under agreements to repurchase		872			1,111			3,749			4,451
Trust preferred debentures		562			798			2,599			2,094
Other borrowings		1,228			1,205			4,862			5,436
Total Interest Expense		5,684			6,919			23,975			24,213
Net Interest Income		42,624			41,849			161,129			134,143
Less: Provision for loan and lease losses		585			5,659			6,161			8,837
Net Interest Income After Provision for Loan and Lease Losses		42,039			36,190			154,968			125,306
NONINTEREST INCOME
Insurance commissions and fees		6,328			6,237			27,916			19,421
Investment services income		3,929			3,836			15,109			14,340
Service charges on deposit accounts		2,309			2,076			8,495			7,441
Card services income		2,053			1,678			7,216			6,030
Mark-to-market loss on trading securities		(66	)		(134	)		(538	)		(332	)
Mark-to-market gain on liabilities held at fair value		12			108			555			246
Net other-than-temporary impairment losses		0			(76	)		0			(196	)
Other income		2,998			2,382			10,546			7,534
(Loss) gain on sale of available-for-sale securities		(124	)		(499	)		599			324
Total Noninterest Income		17,439			15,608			69,898			54,808
NONINTEREST EXPENSES
Salaries and wages		18,582			15,427			67,200			51,700
Pension and other employee benefits		5,150			4,827			22,164			18,075
Net occupancy expense of premises		2,892			2,899			11,757			8,969
Furniture and fixture expense		1,334			1,416			5,701			4,996
FDIC insurance		813			844			3,214			2,685
Amortization of intangible assets		549			580			2,197			1,264
Merger related expenses		0			770			228			15,584
Other operating expense		10,931			11,425			40,641			34,335
Total Noninterest Expenses		40,251			38,188			153,102			137,608
Income Before Income Tax Expense		19,227			13,610			71,764			42,506
Income Tax Expense		4,905			2,416			20,777			11,090
Net Income attributable to Noncontrolling Interests and Tompkins Financial Corporation		14,322			11,194			50,987			31,416
Less: Net income attributable to noncontrolling interests		32			33			131			131
Net Income Attributable to Tompkins Financial Corporation	$	14,290		$	11,161		$	50,856		$	31,285
Basic Earnings Per Share	$	0.97		$	0.78		$	3.48		$	2.44
Diluted Earnings Per Share	$	0.96		$	0.77		$	3.46		$	2.43


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

		Quarter Ended					Year to Date Period Ended					Year to Date Period Ended
		December 31, 2013					December 31, 2013					December 31, 2012
		Average					Average					Average
		Balance			Average		Balance			Average		Balance			Average
(Dollar amounts in thousands)		(QTD)		Interest	Yield/Rate		(YTD)		Interest	Yield/Rate		(YTD)		Interest	Yield/Rate
ASSETS
Interest-earning assets
Interest-bearing balances due from banks	$	1,244	$	1	0.64%	$	2,005	$	10	0.50%	$	21,442	$	33	0.15%
Money market funds		-		-	0.00%		-		-	0.00%		18		-	0.00%
Securities (4)
U.S. Government securities		1,304,043		7,548	2.30%		1,326,999		28,817	2.17%		1,205,759		28,546	2.37%
Trading securities		11,360		117	4.09%		14,188		589	4.15%		18,162		744	4.10%
State and municipal (5)		89,409		1,142	5.07%		95,276		4,893	5.14%		95,095		4,946	5.20%
Other securities (5)		6,876		55	3.17%		7,714		265	3.44%		11,766		544	4.62%
Total securities		1,411,688		8,862	2.49%		1,444,177		34,564	2.39%		1,330,782		34,780	2.61%
Federal Funds Sold		-		-	0.00%		-		-	0.00%		1,837		2	0.11%
FHLBNY and FRB stock		22,453		211	3.73%		22,153		749	3.38%		18,479		824	4.46%

Total loans and leases, net of unearned income (5)(6)		3,135,714		40,129	5.08%		3,053,538		153,569	5.03%		2,382,109		125,541	5.27%
Total interest-earning assets		4,571,099		49,203	4.27%		4,521,873		188,892	4.18%		3,754,667		161,180	4.29%

Other assets		379,377					406,626					337,806

Total assets		4,950,476					4,928,499					4,092,473

LIABILITIES & EQUITY
Deposits
Interest-bearing deposits
Interest bearing checking, savings, & money market		2,222,505		1,122	0.20%		2,224,028		4,938	0.22%		1,750,444		4,854	0.28%
Time deposits		893,181		1,900	0.84%		939,630		7,827	0.83%		846,166		7,378	0.87%
Total interest-bearing deposits		3,115,686		3,022	0.38%		3,163,658		12,765	0.40%		2,596,610		12,232	0.47%

Federal funds purchased & securities sold under agreements to repurchase		168,423		872	2.05%		177,784		3,749	2.11%		200,906		4,451	2.22%
Other borrowings		253,553		1,228	1.92%		222,345		4,862	2.19%		132,746		5,436	4.10%
Trust preferred debentures		37,141		562	6.01%		41,643		2,599	6.24%		32,835		2,094	6.38%
Total interest-bearing liabilities		3,574,803		5,684	0.63%		3,605,430		23,975	0.67%		2,963,097		24,213	0.82%

Noninterest bearing deposits		853,361					806,387					681,260
Accrued expenses and other liabilities		72,867					73,117					71,226
Total liabilities		4,501,031					4,484,934					3,715,583

Tompkins Financial Corporation Shareholders’ equity		447,905					442,054					375,378
Noncontrolling interest		1,540					1,511					1,512
Total equity		449,445					443,565					376,890

Total liabilities and equity	$	4,950,476				$	4,928,499				$	4,092,473
Interest rate spread					3.64%					3.51%					3.48%
Net interest income/margin on earning assets				43,519	3.78%				164,917	3.65%				136,967	3.65%

Tax Equivalent Adjustment				(895)					(3,788)					(2,824)

Net interest income per consolidated financial statements			$	42,624				$	161,129				$	134,143


Tompkins Financial Corporation - Summary Financial Data (Unaudited)

(In thousands, except per share data)		Quarter-Ended															Year-Ended
		Dec-13			Sep-13			Jun-13			Mar-13			Dec-12			Dec-13

Period End Balance Sheet
Securities	$	1,384,782		$	1,390,233		$	1,469,315		$	1,566,510		$	1,433,852		$	1,384,782
Originated loans and leases, net of unearned income and deferred costs and fees (2)		2,527,244			2,420,695			2,309,232			2,208,346			2,133,106			2,527,244
Acquired loans and leases (3)		667,040			698,617			745,951			785,449			821,504			667,040
Allowance for loan and lease losses		27,970			26,408			25,458			24,661			24,643			27,970
Total assets		5,003,039			4,932,428			4,931,883			4,987,280			4,837,197			5,003,039
Total deposits		3,947,216			3,972,756			3,912,910			4,072,352			3,950,169			3,947,216
Federal funds purchased and securities sold under agreements to repurchase		167,724			162,117			171,498			194,091			213,973			167,724
Other borrowings		331,531			242,177			299,098			156,649			111,848			331,531
Trust preferred debentures		37,169			37,127			43,703			43,687			43,668			37,169
Shareholders' equity		457,939			444,276			431,894			446,812			441,360			457,939

Average Balance Sheet
Average earning assets	$	4,571,099		$	4,533,603		$	4,571,428		$	4,409,455		$	4,431,698		$	4,521,873
Average assets		4,950,476			4,897,678			4,965,895			4,899,727			4,901,374			4,928,499
Average interest-bearing liabilities		3,574,803			3,572,708			3,663,230			3,611,748			3,563,731			3,605,430
Average equity		449,445			434,482			447,088			443,277			443,592			443,565

Share data
Weighted average shares outstanding (basic)		14,589,120			14,515,053			14,427,838			14,374,265			14,332,672			14,477,617
Weighted average shares outstanding (diluted)		14,731,786			14,622,512			14,496,859			14,436,757			14,374,368			14,573,919
Period-end shares outstanding		14,749,097			14,692,671			14,599,558			14,447,017			14,390,801			14,749,097
Book value per share		31.05			30.24			29.58			30.93			30.67			31.05
Tangible book value per share (Non-GAAP)		23.70			22.82			22.08			23.29			22.96			23.70

Income Statement
Net interest income	$	42,624		$	40,473		$	39,826		$	38,206		$	41,849		$	161,129
Provision for loan/lease losses		585			2,049			2,489			1,038			5,659			6,161
Noninterest income		17,439			18,528			16,541			17,390			15,608			69,898
Noninterest expense		40,251			37,554			37,777			37,520			38,188			153,102
Income tax expense		4,905			5,316			5,061			5,495			2,416			20,777
Net income attributable to Tompkins Financial Corporation		14,290			14,049			11,007			11,510			11,161			50,856
Noncontrolling interests		32			33			33			33			33			131
Basic earnings per share (9)	$	0.97		$	0.96		$	0.76		$	0.80		$	0.78		$	3.48
Diluted earnings per share (9)	$	0.96		$	0.95		$	0.75		$	0.79		$	0.77		$	3.46

Nonperforming Assets
Originated nonaccrual loans and leases	$	29,875		$	33,881		$	32,100		$	32,554		$	33,388		$	29,875
Acquired nonaccrual loans and leases		8,508			8,008			6,916			4,561			4,352			8,508
Originated loans and leases 90 days past due and accruing		607			1,217			156			157			257			607
Troubled debt restructurings not included above		45			46			0			0			1,532			45
Total nonperforming loans and leases		39,035			43,152			39,172			37,272			39,529			39,035
OREO (8)		4,253			6,264			4,918			3,950			4,862			4,253
Total nonperforming assets		43,288			49,416			44,090			41,222			44,391			43,288

Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued
		Quarter-Ended															Year-Ended
Delinquency - Originated loan and lease portfolio		Dec-13			Sep-13			Jun-13			Mar-13			Dec-12			Dec-13
Loans and leases 30-89 days past due and accruing (2)	$	5,762		$	12,193		$	9,597		$	10,888		$	7,990		$	5,762
Loans and leases 90 days past due and accruing (2)		607			1,217			156			157			257			607
Total originated loans and leases past due and accruing (2)		6,369			13,410			9,753			11,045			8,247			6,369

Delinquency - Acquired loan and lease portfolio
Covered loans and leases 30-89 days past due and accruing (3)(7)		0			1,132			1,613			3,503			1,014			0
Covered loans and leases 90 days or more past due and accruing (3)(7)		2,416			2,980			3,091			3,809			4,272			2,416
Non-covered loans and leases 30-89 days past due and accruing (3)(7)		1,532			6,887			5,591			5,738			4,249			1,532
Non-Covered loans and leases 90 days past due and accruing (3)(7)		4,557			10,521			13,324			14,026			14,438			4,557

Total acquired loans and leases past due and accruing		8,505			21,520			23,619			27,076			23,973			8,505

Total loans and leases past due and accruing	$	14,874		$	34,930		$	33,372		$	38,121		$	32,220		$	14,874

Allowance for Loan Losses - Originated loan and lease portfolio
Balance at beginning of period	$	25,722		$	24,853		$	24,598		$	24,643		$	26,632		$	24,643
Provision for loan and lease losses		(325	)		1,499			(994	)		820			5,659			1,000
Net loan and lease (recoveries) charge-offs		(1,303	)		630			(1,249	)		865			7,648			(1,057	)
Allowance for loan and lease losses (originated loan portfolio) - balance at end of period		26,700			25,722			24,853			24,598			24,643			26,700

Allowance for Loan Losses - Acquired loan and lease portfolio
Balance at beginning of period	$	686		$	605		$	63		$	0		$	0		$	0
Provision for loan and lease losses		910			549			3,483			218			0			5,160
Net loan and lease charge-offs		326			468			2,941			155			0			3,890
Allowance for loan and lease losses (acquired
loan portfolio) - balance at end of period		1,270			686			605			63			0			1,270

Total allowance for loan and lease losses		27,970			26,408			25,458			24,661			24,643			27,970

Loan Classification - Originated Portfolio
Special Mention	$	42,365		$	42,975		$	43,099		$	48,468		$	56,342		$	42,365
Substandard		35,022			37,004			41,969			43,449			45,083			35,022
Loan Classification - Acquired Portfolio
Special Mention		17,322			23,939			29,300			26,568			25,381			17,322
Substandard		33,561			42,433			55,079			47,698			45,207			33,561
Loan Classifications - Total Portfolio
Special Mention		59,687			66,914			72,399			75,036			81,723			59,687
Substandard		68,583			79,437			97,048			91,147			90,290			68,583

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

RATIO ANALYSIS		Quarter-Ended															Year-Ended
Credit Quality		Dec-13			Sep-13			Jun-13			Mar-13			Dec-12			Dec-13
Nonperforming loans and leases/total loans and leases (7)		1.22	%		1.38	%		1.28	%		1.24	%		1.34	%		1.22	%
Nonperforming assets/total assets		0.87	%		1.00	%		0.89	%		0.83	%		0.92	%		0.87	%
Allowance for originated loan and lease losses/total originated loans and leases		1.06	%		1.06	%		1.08	%		1.11	%		1.16	%		1.06	%
Allowance/nonperforming loans and leases		71.65	%		61.20	%		64.99	%		66.16	%		62.34	%		71.65	%
Net loan and lease (recoveries) losses annualized/total average loans and leases		(0.12	%)		0.14	%		0.22	%		0.14	%		1.04	%		0.09	%

Capital Adequacy (period-end)
Tier 1 capital / average assets		8.52	%		8.37	%		8.16	%		8.11	%		7.95	%		8.52	%
Total capital / risk-weighted assets		13.42	%		13.32	%		13.34	%		12.93	%		12.94	%		13.40	%
Tangible common equity / tangible assets		7.11	%		6.92	%		6.65	%		6.87	%		6.96	%		7.11	%

Profitability
Return on average assets *		1.15	%		1.10	%		0.89	%		0.95	%		0.91	%		1.03	%
Return on average equity *		12.62	%		12.83	%		9.87	%		10.53	%		10.01	%		11.47	%
Net interest margin (TE) *		3.78	%		3.63	%		3.58	%		3.57	%		3.83	%		3.65	%
* Quarterly ratios have been annualized

Non-GAAP Disclosure
Reported noninterest income (GAAP)	$	17,439		$	18,528		$	16,541		$	17,390		$	15,608		$	69,898
Adjustments (pre-tax):
Gain on redemption of trust preferred		0			(1,410	)		0			0			0			(1,410	)
Gain on deposit conversion		(1,285	)		0			0			0			0			(1,285	)
Noninterest income (Non-GAAP)	$	16,154		$	17,118		$	16,541		$	17,390		$	15,608		$	67,204

Non-GAAP Disclosure
Reported net income (GAAP)	$	14,290		$	14,049		$	11,007		$	11,510		$	11,161		$	50,856
Adjustments (net of tax):
Merger related expenses		0			0			22			118			462			140
Gain on redemption of trust preferred		0			(846	)		0			0			0			(846	)
Gain on deposit conversion		(771	)		0			0			0			0			(771	)
Subtotal adjustments		(771	)		(846	)		22			118			462			(1,477	)
Net operating income (Non-GAAP)		13,519			13,203			11,029			11,628			11,623			49,379
Adjusted diluted earnings per share (Non-GAAP) (9)	$	0.91		$	0.89		$	0.75		$	0.80		$	0.81		$	3.36

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

Non-GAAP Disclosure		Quarter-Ended															Year-Ended
		Dec-13			Sep-13			Jun-13			Mar-13			Dec-12			Dec-13
Reported net income (GAAP)	$	14,290		$	14,049		$	11,007		$	11,510		$	11,161		$	50,856
Merger related expenses (net of tax)		0			0			22			118			462			140
Gain on redemption of trust preferred (net of tax)		0			(846	)		0			0			0			(846	)
Gain on deposit conversion		(771	)		0			0			0			0			(771	)
Net operating income (Non-GAAP)	$	13,519		$	13,203		$	11,029		$	11,628		$	11,623		$	49,379
Amortization of intangibles (net of tax)		329			327			328			334			348			1,318
Adjusted net operating income (Non-GAAP)		13,848			13,530			11,357			11,962			11,971			50,697

Average total shareholders' equity		449,445			434,482			447,088			443,277			443,592			443,565
Less: Average goodwill and intangibles		108,729			109,277			110,037			110,687			114,644			109,676
Average tangible shareholders' equity (Non-GAAP)		340,716			325,205			337,051			332,590			328,948			333,889

Adjusted operating return on shareholders' tangible equity (annualized) (Non-GAAP)		16.13	%		16.51	%		13.52	%		14.59	%		14.48	%		15.18	%


Non-GAAP Disclosure
Total shareholders' equity (GAAP)	$	457,939		$	444,276		$	431,894		$	446,812		$	441,360		$	457,939
Less: goodwill and intangibles		108,438			108,981			109,540			110,314			110,948			108,438
Tangible shareholders' equity		349,501			335,295			322,354			336,498			330,412			349,501

Ending shares outstanding		14,749,097			14,692,671			14,599,558			14,447,017			14,390,801			14,749,097
Tangible book value per share (Non-GAAP)		23.70			22.82			22.08			23.29			22.96			23.70


Non-GAAP Disclosure	Year-to-date period ended
	Dec-13			Dec-12
Net income attributable to Tompkins Financial				$
Corporation		50,856			31,285
Adjustments (net of tax):
Accrual adjustment VISA		0			(243	)
Merger related expenses		140			9,664
Gain on redemption of trust preferred securities		(846	)		0
Gain on deposit conversion		(771	)		0
Subtotal adjustments		(1,477	)		9,421
Net operating income (Non-GAAP)		49,379			40,706
Adjusted diluted earnings per share	$	3.36		$	3.17

(1) Federal Reserve peer ratio as of September 30, 2013, includes banks and bank holding companies with consolidated assets between $3 billion and $10 billion.

(2) "Originated" equals loans and leases not included by definition in "acquired loans"

(3)"Acquired Loans and Leases" equals loans and leases acquired at fair value, accounted for in accordance with FASB ASC Topic 805. "Covered Loans" are loans for which the Company will share losses with the FDIC and consist of loans VIST Bank acquired as part of an FDIC-assisted transaction during the fourth quarter of 2010.

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

(5) Interest income includes the tax effects of taxable-equivalent basis.

(6) 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, 2012.

(7) Certain acquired loans and leases that are past due are not on nonaccrual and are not included in nonperforming loans. The risk of credit loss on these loans has been considered by virtue of the Corporation's estimate of acquisition-date fair value and these loans are considered accruing as the Corporation primarily recognizes interest income through accretion of the difference between the carrying value of these loans and their expected cash flows.

(8) Includes all other real estate owned, including those balances acquired through business combinations.

(9)Earnings per share year-to-date may not equal the sum of the quarterly earnings per share as a result of rounding of average shares.

Contacts:

Tompkins Financial Corporation
Stephen S. Romaine, President & CEO
Francis M. Fetsko, CFO & COO
888-503-5753