Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil EL&P Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries Tompkins Financial Corporation Reports Second Quarter Financial Results By: Tompkins Financial Corporation via Business Wire July 26, 2024 at 09:00 AM EDT Tompkins Financial Corporation (NYSE American: TMP) Tompkins Financial Corporation ("Tompkins" or the "Company") reported diluted earnings per share of $1.10 for the second quarter of 2024, down 6.8% from the immediate prior quarter, and up 86.4% from diluted earnings per share of $0.59 reported in the second quarter of 2023. Net income for the second quarter of 2024 was $15.7 million, down $1.2 million or 7.1% compared to the most recent prior quarter, and up $7.2 million, or 85.0%, when compared to the $8.5 million reported for the same period in 2023. The increase in diluted earnings per share and net income compared to the results for the second quarter of 2023 largely reflects the Company's sale of $80.9 million of available-for-sale securities which resulted in a $7.1 million (or $0.37 per share) loss on securities transactions in the second quarter of 2023. For the six months ended June 30, 2024, diluted earnings per share were $2.29, up 18.0% from $1.94 for the six months ended June 30, 2023. Year-to-date net income was $32.6 million for the six month period ended June 30, 2024, up $4.7 million, or 16.9%, when compared to $27.9 million for the same six month period in 2023. The growth in year-to-date diluted earnings per share and net income relative to the year-to-date results for the same six month period in 2023 is similarly attributable to the impact caused by the loss on securities transactions described above. Tompkins President and CEO, Stephen Romaine, commented, "Our year to date and second quarter results have been positively impacted by a stabilizing net interest margin and growth throughout our business. Year over year loans are up 7.7% and year to date noninterest income was up 33%, or 10% excluding the impact from the loss on the sale of securities in the second quarter of 2023. We have remained focused on expenses with noninterest expenses year to date lower by 2.3%. As we continue to leverage our balance sheet we are seeing strengthening operating results with stabilizing and growing revenue and lower expenses. We look forward to driving growth through quality customer relationships supported by our strong capital and liquidity." SELECTED HIGHLIGHTS FOR THE PERIOD: Net interest margin for the second quarter of 2024 was 2.73%, unchanged from the first quarter of 2024, and down from 2.83% for the second quarter of 2023. Total cost of funds was up 10 basis points compared to the first quarter 2024, down from a 24 basis point increase from the fourth quarter of 2023 to the first quarter of 2024. Fee-based services (insurance, wealth management, service charges on deposit accounts and cards) revenues for the second quarter of 2024 were up $903,000 or 5.0% compared to the second quarter of 2023. Total operating expenses of $49.9 million for the second quarter of 2024 were in line with the most recent prior quarter, and down $2.0 million or 3.9% compared to the second quarter of 2023. Total loans at June 30, 2024 were up $121.3 million, or 2.2% (8.7% on an annualized basis) compared to the immediate prior quarter, and up $409.5 million, or 7.7%, from June 30, 2023. Total deposits at June 30, 2024 were $6.3 billion, down $163.7 million, or 2.5% from March 31, 2024, and $168.8 million, or 2.6%, from June 30, 2023. Loan to deposit ratio at June 30, 2024 was 91.7%, compared to 87.5% for the immediate prior quarter. Regulatory Tier 1 capital to average assets was 9.15% at June 30, 2024, up compared to 9.08% reported at March 31, 2024, and down compared to 9.57% at June 30, 2023. NET INTEREST INCOME Net interest income was $51.0 million for the second quarter of 2024, up from $50.7 million for the first quarter of 2024, and down from $51.9 million for the second quarter of 2023. Net interest income for the quarter ended June 30, 2024 was impacted by increases in interest expense, which totaled $34.3 million for the second quarter of 2024 compared to $20.0 million for the same period in 2023, partially offset by increased interest and dividend income, which increased by $13.4 million when compared to the second quarter of 2023. For the six months ended June 30, 2024, net interest income was $101.6 million, down $4.5 million or 4.3% when compared to the same period in 2023. Net interest margin was 2.73% for the second quarter of 2024, unchanged from the first quarter of 2024, and down from the 2.83% reported for the second quarter of 2023. The decrease in net interest margin, when compared to the prior year, was mainly driven by higher funding costs, driven by market rates and higher borrowings due to lower deposit balances, and was partially offset by higher yields on interest earnings assets. Average loans for the quarter ended June 30, 2024 were up $65.9 million, or 1.2%, from the first quarter of 2024, and were up $382.8 million, or 7.2%, compared to the prior year second quarter. The increase in average loans over both prior periods was mainly in the commercial real estate and commercial and industrial portfolios. The average yield on interest-earning assets for the quarter ended June 30, 2024 was 4.56%, which was up from 4.47% for the prior quarter ended March 31, 2024, and up from 3.91% for the quarter ended June 30, 2023. Average total deposits for the second quarter of 2024 were down $42.9 million, or 0.7%, compared to the first quarter of 2024, and down $128.3 million or 2.0% compared to the same period in 2023. The decrease compared to the prior quarter was mainly driven by seasonal deposit trends, while the decrease compared to the prior year was largely driven by inflation and persistent rate competition for deposits due to the current interest rate environment and tightening monetary policy. The cost of interest-bearing deposits of 2.27% for the second quarter of 2024 was up 10 basis points from 2.17% for the first quarter of 2024, and up 86 basis points from 1.41% for the second quarter of 2023. The ratio of average noninterest bearing deposits to average total deposits for the second quarter of 2024 was 29.1% compared to 28.8% for the first quarter of 2024, and 31.1% for the quarter ended June 30, 2023. The average cost of interest-bearing liabilities for the second quarter of 2024 of 2.64% represents an increase of 13 basis points over the first quarter of 2024, and an increase of 100 basis points over the same period in 2023. NONINTEREST INCOME Noninterest income represented 29.9% of total revenue for the second quarter of 2024 compared to 30.4% for the first quarter of 2024, and 19.6% for the second quarter of 2023. Noninterest income of $21.8 million for the second quarter of 2024 was up $9.2 million or 72.6% compared to the same period in 2023. Year-to-date noninterest income of $43.9 million was up $10.9 million or 33.0% compared to the same period in 2023. The increase in quarterly and year-to-date noninterest income compared to the same periods in 2023 was mainly due to a $7.1 million loss on the sale of available-for-sale securities discussed above. Also included in the increase in the second quarter of 2024 over the same period prior year are fee-based revenues which included insurance commissions and fees, up $415,000, wealth management fees, up $171,000, service charges on deposit accounts, up $126,000, and card services income, up $191,000. NONINTEREST EXPENSE Noninterest expense was $49.9 million for the second quarter of 2024, which was down $2.0 million or 3.9% compared to the second quarter of 2023. Year-to-date noninterest expense for the period ended June 30, 2024 was $99.8 million, a decrease of $2.3 million or 2.3% compared to the $102.1 million reported for the same period in 2023. The decrease was mainly driven by lower other expenses (legal fees, marketing expense, professional fees, and travel and meeting expense) and lower salaries, wages and other employee benefits in the second quarter of 2024 compared to the same period in 2023. INCOME TAX EXPENSE The provision for income tax expense was $4.9 million for an effective rate of 23.8% for the second quarter of 2024, compared to tax expense of $1.8 million and an effective rate of 17.3% for the same quarter in 2023. For the first six months of 2024, the provision for income tax expense was $10.1 million and the effective tax rate was 23.6% compared to provision expense of $7.7 million and an effective tax rate of 21.6% for the same period in 2023. Lower tax expense for both the quarter and year-to-date periods in 2023 was mainly a result of lower income associated with the loss on the sale of securities described above. ASSET QUALITY The allowance for credit losses represented 0.92% of total loans and leases at June 30, 2024, unchanged from the most recent prior quarter and December 31, 2023. The ratio of the allowance to total nonperforming loans and leases was 84.94% at June 30, 2024, compared to 82.47% at March 31, 2024, and 154.76% at June 30, 2023. The decrease in the ratio compared to the same prior year period was due to the increase in nonperforming loans and leases discussed in more detail below. Provision for credit losses for the second quarter of 2024 was $2.2 million compared to provision expense of $2.3 million for the same period in 2023. Provision for credit losses for the six months ended June 30, 2024 was $3.0 million compared to $1.4 million for the six months ended June 30, 2023. The increase in provision expense for the year-to-date period compared to the same period in 2023 was mainly driven by loan growth and changes in off balance sheet reserves driven by an increase in loan pipeline. Net charge-offs for the second quarter of 2024 were $509,000 compared to net recoveries of $27,000 reported for the same period in 2023. Nonperforming assets represented 0.79% of total assets at June 30, 2024, down from 0.81% reported at March 31, 2024, and up compared to 0.41% at June 30, 2023. At June 30, 2024, nonperforming loans and leases totaled $62.5 million, compared to $62.7 million at March 31, 2024 and $31.4 million at June 30, 2023. The increase in nonperforming loans and leases at June 30, 2024 compared to results at June 30, 2023 was mainly due to the addition in the fourth quarter of 2023 of one relationship totaling approximately $33.3 million with two commercial real estate properties included in the office space and mixed use properties portion of the commercial real estate portfolio. The Company believes that the existing collateral securing the loans is sufficient to cover the exposure as of June 30, 2024. Special Mention and Substandard loans and leases totaled $116.2 million at June 30, 2024, compared to $118.7 million reported at March 31, 2024, and $118.1 million reported at June 30, 2023. CAPITAL POSITION Capital ratios at June 30, 2024 remained well above the regulatory minimums for well-capitalized institutions. The ratio of total capital to risk-weighted assets was 13.26% at June 30, 2024, compared to 13.43% at March 31, 2024, and 14.48% at June 30, 2023. The ratio of Tier 1 capital to average assets was 9.15% at June 30, 2024, compared to 9.08% at March 31, 2024, and 9.57% at June 30, 2023. LIQUIDITY POSITION The Company's liquidity position at June 30, 2024 was stable and consistent with the immediately prior quarter. Liquidity is enhanced by ready access to national and regional wholesale funding sources including Federal funds purchased, repurchase agreements, brokered deposits, Federal Reserve Bank's Discount Window advances and Federal Home Loan Banks (FHLB) advances. The Company maintains ready access to liquidity of $1.4 billion, or 17.3% of total assets at June 30, 2024. As a member of the FHLB, the Company can use certain unencumbered mortgage-related assets and securities to secure borrowings from the FHLB. At June 30, 2024 the Company had an available borrowing capacity at the FHLB of $661.8 million. Through various programs at the Federal Reserve Bank, the Company has the ability to use certain loans and securities to secure borrowings from the Federal Reserve Bank's Discount Window. At June 30, 2024 the available borrowing capacity with the Federal Reserve Bank was $137.7 million, secured by loans. In addition to the available borrowing lines at the FHLB and Federal Reserve Bank, at June 30, 2024, the Company maintained $553.3 million of unencumbered securities which could be pledged to further enhance secured borrowing capacity. 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 and Tompkins Insurance Agencies, Inc. Tompkins Community Bank provides a full array of wealth management services under the Tompkins Financial Advisors brand, including investment management, trust and estate, financial and tax planning services. 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. The statements contained in this press release that are not statements of historical fact may include forward-looking statements that involve a number of risks and uncertainties. Forward-looking statements may be identified by use of such words as "may", "will", "estimate", "intend", "continue", "believe", "expect", "plan", "commit", or "anticipate", the negative and other variations of these terms and other similar words. Examples of forward-looking statements may include statements regarding the sufficiency of existing collateral to cover exposure related to nonperforming loans, and the strength of our balance sheet. Forward-looking statements are made based on management’s expectations and beliefs concerning future events impacting the Company and are subject to 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 and historical performance. The following factors, in addition to those listed as Risk Factors in Item 1A in 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; our ability to attract and retain deposits and other sources of liquidity; gross domestic product growth and inflation trends; 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, including the Dodd-Frank Act, and state and local government mandates; the impact of any change in the FDIC insurance assessment rate or the rules and regulations related to the calculation of the FDIC insurance assessment amount; technological developments and changes; cybersecurity incidents and threats; 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; the ability to access financial resources in the amounts, at the times, and on the terms required to support the Company's future businesses; and the economic impact of national and global events, including the response to bank failures, war and geopolitical matters (including the war in Israel and potential for broader regional conflict and the war in Ukraine), widespread protests, civil unrest, political uncertainty, and pandemics or other public health crises. 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) (Unaudited) As of As of ASSETS 06/30/2024 12/31/2023 (Audited) Cash and noninterest bearing balances due from banks $ 60,337 $ 67,212 Interest bearing balances due from banks 10,578 12,330 Cash and Cash Equivalents 70,915 79,542 Available-for-sale debt securities, at fair value (amortized cost of $1,463,965 at June 30, 2024 and $1,548,482 at December 31, 2023) 1,317,458 1,416,650 Held-to-maturity debt securities, at amortized cost (fair value of $264,588 at June 30, 2024 and $267,455 at December 31, 2023) 312,430 312,401 Equity securities, at fair value 766 787 Total loans and leases, net of unearned income and deferred costs and fees 5,761,864 5,605,935 Less: Allowance for credit losses 53,059 51,584 Net Loans and Leases 5,708,805 5,554,351 Federal Home Loan Bank and other stock 41,382 33,719 Bank premises and equipment, net 77,279 79,687 Corporate owned life insurance 75,453 67,884 Goodwill 92,602 92,602 Other intangible assets, net 2,193 2,327 Accrued interest and other assets 170,239 179,799 Total Assets $ 7,869,522 $ 7,819,749 LIABILITIES Deposits: Interest bearing: Checking, savings and money market 3,453,049 3,484,878 Time 979,292 998,013 Noninterest bearing 1,853,555 1,916,956 Total Deposits 6,285,896 6,399,847 Federal funds purchased and securities sold under agreements to repurchase 35,989 50,996 Other borrowings 773,627 602,100 Other liabilities 97,917 96,872 Total Liabilities $ 7,193,429 $ 7,149,815 EQUITY Tompkins Financial Corporation shareholders' equity: Common Stock - par value $.10 per share: Authorized 25,000,000 shares; Issued: 14,429,124 at June 30, 2024; and 14,441,830 at December 31, 2023 1,443 1,444 Additional paid-in capital 298,647 297,183 Retained earnings 516,566 501,510 Accumulated other comprehensive loss (135,670 ) (125,005 ) Treasury stock, at cost – 126,450 shares at June 30, 2024, and 132,097 shares at December 31, 2023 (6,356 ) (6,610 ) Total Tompkins Financial Corporation Shareholders’ Equity 674,630 668,522 Noncontrolling interests 1,463 1,412 Total Equity $ 676,093 $ 669,934 Total Liabilities and Equity $ 7,869,522 $ 7,819,749 TOMPKINS FINANCIAL CORPORATION CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share data) (Unaudited) Three Months Ended Six Months Ended 06/30/2024 03/31/2024 06/30/2023 06/30/2024 06/30/2023 INTEREST AND DIVIDEND INCOME Loans $ 73,646 $ 71,599 $ 63,527 $ 145,245 $ 124,369 Due from banks 184 154 183 338 322 Available-for-sale debt securities 9,371 9,611 6,618 18,982 13,361 Held-to-maturity debt securities 1,219 1,218 1,219 2,437 2,433 Federal Home Loan Bank and other stock 820 601 323 1,421 623 Total Interest and Dividend Income 85,240 $ 83,183 $ 71,870 $ 168,423 $ 141,108 INTEREST EXPENSE Time certificates of deposits of $250,000 or more 4,048 4,010 2,526 8,058 4,313 Other deposits 21,236 20,424 13,119 41,660 23,513 Federal funds purchased and securities sold under agreements to repurchase 11 13 15 24 29 Other borrowings 8,992 8,061 4,314 17,053 7,111 Total Interest Expense 34,287 32,508 19,974 66,795 34,966 Net Interest Income 50,953 50,675 51,896 101,628 106,142 Less: Provision for credit loss expense 2,172 854 2,253 3,026 1,428 Net Interest Income After Provision for Credit Loss Expense 48,781 49,821 49,643 98,602 104,714 NONINTEREST INCOME Insurance commissions and fees 9,087 10,259 8,672 19,346 18,181 Wealth management fees 4,849 4,937 4,678 9,786 9,187 Service charges on deposit accounts 1,766 1,796 1,640 3,562 3,386 Card services income 3,278 2,939 3,087 6,217 5,769 Other income 2,802 2,220 1,603 5,022 3,544 Net loss on securities transactions (6 ) (14 ) (7,065 ) (20 ) (7,052 ) Total Noninterest Income 21,776 22,137 12,615 43,913 33,015 NONINTEREST EXPENSE Salaries and wages 24,919 24,697 25,337 49,616 49,849 Other employee benefits 6,545 6,411 6,647 12,956 13,388 Net occupancy expense of premises 3,139 3,557 3,327 6,696 6,626 Furniture and fixture expense 1,910 2,125 2,105 4,035 4,159 Amortization of intangible assets 80 76 84 156 167 Other operating expense 13,349 12,991 14,468 26,340 27,937 Total Noninterest Expenses 49,942 49,857 51,968 99,799 102,126 Income Before Income Tax Expense 20,615 22,101 10,290 42,716 35,603 Income Tax Expense 4,902 5,198 1,784 10,100 7,685 Net Income Attributable to Noncontrolling Interests and Tompkins Financial Corporation 15,713 16,903 8,506 32,616 27,918 Less: Net Income Attributable to Noncontrolling Interests 31 31 31 62 62 Net Income Attributable to Tompkins Financial Corporation $ 15,682 16,872 8,475 32,554 27,856 Basic Earnings Per Share $ 1.10 $ 1.19 $ 0.59 $ 2.29 $ 1.94 Diluted Earnings Per Share $ 1.10 $ 1.18 $ 0.59 $ 2.29 $ 1.94 Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited) Quarter Ended Quarter Ended June 30, 2024 March 31, 2024 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 $ 11,707 $ 184 6.33 % $ 12,202 $ 154 5.08 % Securities (1) U.S. Government securities 1,717,975 10,067 2.36 % 1,756,122 10,303 2.36 % State and municipal (2) 89,518 566 2.55 % 89,886 570 2.55 % Other securities 3,260 59 7.32 % 3,278 60 7.32 % Total securities 1,810,753 10,692 2.38 % 1,849,286 10,933 2.38 % FHLBNY and FRB stock 37,681 820 8.76 % 34,613 601 6.99 % Total loans and leases, net of unearned income (2)(3) 5,687,548 73,839 5.22 % 5,621,604 71,779 5.14 % Total interest-earning assets 7,547,689 85,535 4.56 % 7,517,705 83,467 4.47 % Other assets 262,372 283,420 Total assets $ 7,810,061 $ 7,801,125 LIABILITIES & EQUITY Deposits Interest-bearing deposits Interest bearing checking, savings, & money market 3,498,746 15,754 1.81 % 3,546,216 15,036 1.71 % Time deposits 987,348 9,530 3.88 % 988,891 9,398 3.82 % Total interest-bearing deposits 4,486,094 25,284 2.27 % 4,535,107 24,434 2.17 % Federal funds purchased & securities sold under agreements to repurchase 40,298 11 0.11 % 48,779 13 0.10 % Other borrowings 688,611 8,992 5.25 % 622,951 8,061 5.21 % Total interest-bearing liabilities 5,215,003 34,287 2.64 % 5,206,836 32,508 2.51 % Noninterest bearing deposits 1,837,325 1,831,244 Accrued expenses and other liabilities 94,764 96,292 Total liabilities 7,147,092 7,134,373 Tompkins Financial Corporation Shareholders’ equity 661,523 665,333 Noncontrolling interest 1,446 1,419 Total equity 662,969 666,752 Total liabilities and equity $ 7,810,061 $ 7,801,125 Interest rate spread 1.91 % 1.95 % Net interest income (TE)/margin on earning assets 51,248 2.73 % 50,959 2.73 % Tax Equivalent Adjustment (295 ) (284 ) Net interest income $ 50,953 $ 50,675 Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited) Quarter Ended Quarter Ended June 30, 2024 June 30, 2023 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 $ 11,707 $ 184 6.33 % $ 13,585 $ 183 5.40 % Securities (1) U.S. Government securities 1,717,975 10,067 2.36 % 1,972,719 7,304 1.49 % State and municipal (2) 89,518 566 2.55 % 92,194 590 2.57 % Other securities 3,260 59 7.32 % 3,288 56 6.86 % Total securities 1,810,753 10,692 2.38 % 2,068,201 7,950 1.54 % FHLBNY and FRB stock 37,681 820 8.76 % 23,211 323 5.59 % Total loans and leases, net of unearned income (2)(3) 5,687,548 73,839 5.22 % 5,304,717 63,709 4.82 % Total interest-earning assets 7,547,689 85,535 4.56 % 7,409,714 72,165 3.91 % Other assets 262,372 226,086 Total assets $ 7,810,061 $ 7,635,800 LIABILITIES & EQUITY Deposits Interest-bearing deposits Interest bearing checking, savings, & money market $ 3,498,746 $ 15,754 1.81 % $ 3,701,229 $ 10,590 1.15 % Time deposits 987,348 9,530 3.88 % 745,970 5,055 2.72 % Total interest-bearing deposits 4,486,094 25,284 2.27 % 4,447,199 15,645 1.41 % Federal funds purchased & securities sold under agreements to repurchase 40,298 11 0.11 % 56,083 15 0.11 % Other borrowings 688,611 8,992 5.25 % 379,744 4,314 4.56 % Total interest-bearing liabilities 5,215,003 34,287 2.64 % 4,883,026 19,974 1.64 % Noninterest bearing deposits 1,837,325 2,004,560 Accrued expenses and other liabilities 94,764 97,660 Total liabilities 7,147,092 6,985,246 Tompkins Financial Corporation Shareholders’ equity 661,523 649,097 Noncontrolling interest 1,446 1,457 Total equity 662,969 650,554 Total liabilities and equity $ 7,810,061 $ 7,635,800 Interest rate spread 1.91 % 2.27 % Net interest income (TE)/margin on earning assets 51,248 2.73 % 52,191 2.83 % Tax Equivalent Adjustment (295 ) (295 ) Net interest income $ 50,953 $ 51,896 Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited) Year to Date Period Ended Year to Date Period Ended June 30, 2024 June 30, 2023 Average Average Balance Average Balance Average (Dollar amounts in thousands) (YTD) Interest Yield/Rate (YTD) Interest Yield/Rate ASSETS Interest-earning assets Interest-bearing balances due from banks $ 11,955 $ 338 5.69 % $ 13,161 $ 322 4.93 % Securities (1) U.S. Government securities 1,737,049 20,370 2.36 % 2,002,846 14,728 1.48 % State and municipal (2) 89,702 1,137 2.55 % 92,695 1,188 2.58 % Other securities 3,269 119 7.32 % 3,286 110 6.70 % Total securities 1,830,020 21,626 2.38 % 2,098,827 16,026 1.54 % FHLBNY and FRB stock 36,147 1,421 7.90 % 19,998 623 6.29 % Total loans and leases, net of unearned income (2)(3) 5,654,576 145,616 5.18 % 5,278,145 124,744 4.77 % Total interest-earning assets 7,532,698 169,001 4.51 % 7,410,131 141,715 3.86 % Other assets 272,895 224,671 Total assets $ 7,805,593 $ 7,634,802 LIABILITIES & EQUITY Deposits Interest-bearing deposits Interest bearing checking, savings, & money market $ 3,522,481 $ 30,790 1.76 % $ 3,767,032 $ 19,230 1.03 % Time deposits 988,119 18,928 3.85 % 710,119 8,596 2.44 % Total interest-bearing deposits 4,510,600 49,718 2.22 % 4,477,151 27,826 1.25 % Federal funds purchased & securities sold under agreements to repurchase 44,538 24 0.11 % 56,799 29 0.10 % Other borrowings 655,781 17,053 5.23 % 325,052 7,111 4.41 % Total interest-bearing liabilities 5,210,919 66,795 2.58 % 4,859,002 34,966 1.45 % Noninterest bearing deposits 1,834,284 2,034,961 Accrued expenses and other liabilities 95,529 99,905 Total liabilities 7,140,732 6,993,868 Tompkins Financial Corporation Shareholders’ equity 663,428 639,494 Noncontrolling interest 1,433 1,440 Total equity 664,861 640,934 Total liabilities and equity $ 7,805,593 $ 7,634,802 Interest rate spread 1.93 % 2.41 % Net interest income (TE)/margin on earning assets 102,206 2.73 % 106,749 2.90 % Tax Equivalent Adjustment (578 ) (607 ) Net interest income $ 101,628 $ 106,142 Tompkins Financial Corporation - Summary Financial Data (Unaudited) (In thousands, except per share data) Quarter-Ended Year-Ended Period End Balance Sheet Jun-24 Mar-24 Dec-23 Sep-23 Jun-23 Dec-23 Securities $ 1,630,654 $ 1,679,542 $ 1,729,838 $ 1,701,636 $ 1,781,150 $ 1,729,838 Total Loans 5,761,864 5,640,524 5,605,935 5,434,860 5,352,365 5,605,935 Allowance for credit losses 53,059 51,704 51,584 49,336 48,545 51,584 Total assets 7,869,522 7,778,034 7,819,749 7,691,162 7,626,238 7,819,749 Total deposits 6,285,896 6,449,616 6,399,847 6,623,436 6,454,651 6,399,847 Federal funds purchased and securities sold under agreements to repurchase 35,989 43,681 50,996 56,120 50,483 50,996 Other borrowings 773,627 522,600 602,100 296,800 387,100 602,100 Total common equity 674,630 667,906 668,522 610,851 634,967 668,522 Total equity 676,093 669,338 669,934 612,356 636,441 669,934 Average Balance Sheet Average earning assets $ 7,547,689 $ 7,517,705 $ 7,407,976 $ 7,405,434 $ 7,409,714 $ 7,408,404 Average assets 7,810,061 7,801,125 7,666,982 7,629,876 7,635,800 7,641,672 Average interest-bearing liabilities 5,215,003 5,206,836 5,020,544 4,902,930 4,883,026 4,910,792 Average equity 662,969 666,752 622,280 634,980 650,554 634,732 Share data Weighted average shares outstanding (basic) 14,214,574 14,211,910 14,194,503 14,185,763 14,314,133 14,254,661 Weighted average shares outstanding (diluted) 14,239,626 14,238,357 14,246,024 14,224,748 14,346,787 14,301,221 Period-end shares outstanding 14,395,204 14,405,019 14,405,920 14,350,177 14,405,503 14,405,920 Common equity book value per share $ 46.86 $ 46.37 $ 46.41 $ 42.57 $ 44.08 $ 46.41 Tangible book value per share (Non-GAAP)** $ 40.35 $ 39.85 $ 39.88 $ 36.01 $ 37.54 $ 39.88 **See "Non-GAAP measures" below for a discussion of non-GAAP financial measures and a reconciliation of non-GAAP financial measures to the most directly comparable financial measures presented in accordance with GAAP. Income Statement Net interest income $ 50,953 $ 50,675 $ 52,359 $ 51,013 $ 51,896 $ 209,514 Provision for credit loss expense (5) 2,172 854 1,761 1,150 2,253 4,339 Noninterest income 21,776 22,137 18,850 (41,624 ) 12,615 10,241 Noninterest expense (5) 49,942 49,857 51,300 49,866 51,968 203,292 Income tax expense/(benefit) 4,902 5,198 3,114 (8,304 ) 1,784 2,495 Net income/(loss) attributable to Tompkins Financial Corporation 15,682 16,872 15,003 (33,354 ) 8,475 9,505 Noncontrolling interests 31 31 31 31 31 124 Basic earnings (loss) per share (4) 1.10 1.19 1.06 (2.35 ) 0.59 0.66 Diluted earnings (loss) per share (4) 1.10 1.18 1.05 (2.35 ) 0.59 0.66 Nonperforming Assets Nonaccrual loans and leases $ 62,253 $ 62,544 $ 62,165 $ 31,381 $ 31,333 $ 62,165 Loans and leases 90 days past due and accruing 215 151 101 52 34 101 Total nonperforming loans and leases 62,468 62,695 62,266 31,433 31,367 62,266 OREO 80 0 131 0 36 131 Total nonperforming assets $ 62,548 $ 62,695 $ 62,397 $ 31,433 $ 31,403 $ 62,397 Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued Quarter-Ended Year-Ended Delinquency - Total loan and lease portfolio Jun-24 Mar-24 Dec-23 Sep-23 Jun-23 Dec-23 Loans and leases 30-89 days past due and accruing $ 5,286 $ 8,015 $ 4,210 $ 40,893 $ 20,255 $ 4,210 Loans and leases 90 days past due and accruing 215 151 101 52 34 101 Total loans and leases past due and accruing 5,501 8,166 4,311 40,945 20,289 4,311 Allowance for Credit Losses Balance at beginning of period $ 51,704 $ 51,584 $ 49,336 $ 48,545 $ 46,099 $ 45,934 Impact of adopting ASC 326 0 0 0 0 0 64 Provision for credit losses 1,864 348 2,658 968 2,419 $ 4,865 Net loan and lease charge-offs (recoveries) 509 228 410 177 (27 ) $ (721 ) Allowance for credit losses at end of period $ 53,059 $ 51,704 $ 51,584 $ 49,336 $ 48,545 $ 51,584 Allowance for Credit Losses - Off-Balance Sheet Exposure Balance at beginning of period $ 2,776 $ 2,270 $ 3,167 $ 2,985 $ 3,151 $ 2,796 Provision (credit) for credit losses 308 506 (897 ) 182 (166 ) $ (526 ) Allowance for credit losses at end of period $ 3,084 $ 2,776 $ 2,270 $ 3,167 $ 2,985 $ 2,270 Loan Classification - Total Portfolio Special Mention $ 48,712 $ 46,302 $ 50,368 $ 65,993 $ 56,305 $ 50,368 Substandard 67,509 72,412 72,717 56,947 61,820 72,717 Ratio Analysis Credit Quality Nonperforming loans and leases/total loans and leases 1.08 % 1.11 % 1.11 % 0.58 % 0.59 % 1.11 % Nonperforming assets/total assets 0.79 % 0.81 % 0.80 % 0.41 % 0.41 % 0.80 % Allowance for credit losses/total loans and leases 0.92 % 0.92 % 0.92 % 0.91 % 0.91 % 0.92 % Allowance/nonperforming loans and leases 84.94 % 82.47 % 82.84 % 156.96 % 154.76 % 82.84 % Net loan and lease losses (recoveries) annualized/total average loans and leases 0.04 % 0.02 % 0.03 % 0.01 % 0.00 % (0.01 )% Capital Adequacy Tier 1 Capital (to average assets) 9.15 % 9.08 % 9.08 % 9.01 % 9.57 % 9.08 % Total Capital (to risk-weighted assets) 13.26 % 13.43 % 13.36 % 13.46 % 14.48 % 13.36 % Profitability (period-end) Return on average assets * 0.81 % 0.87 % 0.78 % (1.73 )% 0.45 % 0.12 % Return on average equity * 9.51 % 10.18 % 9.56 % (20.84 )% 5.22 % 1.50 % Net interest margin (TE) * 2.73 % 2.73 % 2.82 % 2.75 % 2.83 % 2.84 % Average yield on interest-earning assets* 4.56 % 4.47 % 4.34 % 4.06 % 3.91 % 4.03 % Average cost of deposits* 1.61 % 1.54 % 1.43 % 1.20 % 0.97 % 1.09 % Average cost of funds* 1.96 % 1.86 % 1.62 % 1.41 % 1.16 % 1.27 % * Quarterly ratios have been annualized Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued Non-GAAP Measures This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principals (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 below tables. The Company believes the non-GAAP measures provide meaningful comparisons of our underlying operational performance and facilitate management's and investors' assessments of business and performance trends in comparison to others in the financial services industry. These non-GAAP financial measures should not be considered in isolation or as a measure of the Company's profitability or liquidity; they are in addition to, and are not a substitute for, financial measures under GAAP. The non-GAAP financial measures presented herein may be different from non-GAAP financial measures used by other companies, and may not be comparable to similarly titled measures reported by other companies. Further, the Company may utilize other measures to illustrate performance in the future. Non-GAAP financial measures have limitations since they do not reflect all of the amounts associated with the Company's results of operations as determined in accordance with GAAP. Reconciliation of Tangible Book Value Per Share (non-GAAP) to Common Equity Book Value Per Share (GAAP) Quarter-Ended Year-Ended Jun-24 Mar-24 Dec-23 Sep-23 Jun-23 Dec-23 Total common equity $ 674,630 $ 667,906 $ 668,522 $ 610,851 $ 634,967 $ 668,522 Less: Goodwill and intangibles 93,847 93,926 94,003 94,086 94,169 94,003 Tangible common equity (Non-GAAP) 580,783 573,980 574,519 516,765 540,798 574,519 Ending shares outstanding 14,395,204 14,405,019 14,405,920 14,350,177 14,405,503 14,405,920 Tangible book value per share (Non-GAAP) $ 40.35 $ 39.85 $ 39.88 $ 36.01 $ 37.54 $ 39.88 (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 2024 and 2023 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, 2023. (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. View source version on businesswire.com: https://www.businesswire.com/news/home/20240726210452/en/Contacts For more information: Stephen S. Romaine, President & CEO Matthew Tomazin, Executive VP, CFO & Treasurer Tompkins Financial Corporation (888) 503-5753 Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
Tompkins Financial Corporation Reports Second Quarter Financial Results By: Tompkins Financial Corporation via Business Wire July 26, 2024 at 09:00 AM EDT Tompkins Financial Corporation (NYSE American: TMP) Tompkins Financial Corporation ("Tompkins" or the "Company") reported diluted earnings per share of $1.10 for the second quarter of 2024, down 6.8% from the immediate prior quarter, and up 86.4% from diluted earnings per share of $0.59 reported in the second quarter of 2023. Net income for the second quarter of 2024 was $15.7 million, down $1.2 million or 7.1% compared to the most recent prior quarter, and up $7.2 million, or 85.0%, when compared to the $8.5 million reported for the same period in 2023. The increase in diluted earnings per share and net income compared to the results for the second quarter of 2023 largely reflects the Company's sale of $80.9 million of available-for-sale securities which resulted in a $7.1 million (or $0.37 per share) loss on securities transactions in the second quarter of 2023. For the six months ended June 30, 2024, diluted earnings per share were $2.29, up 18.0% from $1.94 for the six months ended June 30, 2023. Year-to-date net income was $32.6 million for the six month period ended June 30, 2024, up $4.7 million, or 16.9%, when compared to $27.9 million for the same six month period in 2023. The growth in year-to-date diluted earnings per share and net income relative to the year-to-date results for the same six month period in 2023 is similarly attributable to the impact caused by the loss on securities transactions described above. Tompkins President and CEO, Stephen Romaine, commented, "Our year to date and second quarter results have been positively impacted by a stabilizing net interest margin and growth throughout our business. Year over year loans are up 7.7% and year to date noninterest income was up 33%, or 10% excluding the impact from the loss on the sale of securities in the second quarter of 2023. We have remained focused on expenses with noninterest expenses year to date lower by 2.3%. As we continue to leverage our balance sheet we are seeing strengthening operating results with stabilizing and growing revenue and lower expenses. We look forward to driving growth through quality customer relationships supported by our strong capital and liquidity." SELECTED HIGHLIGHTS FOR THE PERIOD: Net interest margin for the second quarter of 2024 was 2.73%, unchanged from the first quarter of 2024, and down from 2.83% for the second quarter of 2023. Total cost of funds was up 10 basis points compared to the first quarter 2024, down from a 24 basis point increase from the fourth quarter of 2023 to the first quarter of 2024. Fee-based services (insurance, wealth management, service charges on deposit accounts and cards) revenues for the second quarter of 2024 were up $903,000 or 5.0% compared to the second quarter of 2023. Total operating expenses of $49.9 million for the second quarter of 2024 were in line with the most recent prior quarter, and down $2.0 million or 3.9% compared to the second quarter of 2023. Total loans at June 30, 2024 were up $121.3 million, or 2.2% (8.7% on an annualized basis) compared to the immediate prior quarter, and up $409.5 million, or 7.7%, from June 30, 2023. Total deposits at June 30, 2024 were $6.3 billion, down $163.7 million, or 2.5% from March 31, 2024, and $168.8 million, or 2.6%, from June 30, 2023. Loan to deposit ratio at June 30, 2024 was 91.7%, compared to 87.5% for the immediate prior quarter. Regulatory Tier 1 capital to average assets was 9.15% at June 30, 2024, up compared to 9.08% reported at March 31, 2024, and down compared to 9.57% at June 30, 2023. NET INTEREST INCOME Net interest income was $51.0 million for the second quarter of 2024, up from $50.7 million for the first quarter of 2024, and down from $51.9 million for the second quarter of 2023. Net interest income for the quarter ended June 30, 2024 was impacted by increases in interest expense, which totaled $34.3 million for the second quarter of 2024 compared to $20.0 million for the same period in 2023, partially offset by increased interest and dividend income, which increased by $13.4 million when compared to the second quarter of 2023. For the six months ended June 30, 2024, net interest income was $101.6 million, down $4.5 million or 4.3% when compared to the same period in 2023. Net interest margin was 2.73% for the second quarter of 2024, unchanged from the first quarter of 2024, and down from the 2.83% reported for the second quarter of 2023. The decrease in net interest margin, when compared to the prior year, was mainly driven by higher funding costs, driven by market rates and higher borrowings due to lower deposit balances, and was partially offset by higher yields on interest earnings assets. Average loans for the quarter ended June 30, 2024 were up $65.9 million, or 1.2%, from the first quarter of 2024, and were up $382.8 million, or 7.2%, compared to the prior year second quarter. The increase in average loans over both prior periods was mainly in the commercial real estate and commercial and industrial portfolios. The average yield on interest-earning assets for the quarter ended June 30, 2024 was 4.56%, which was up from 4.47% for the prior quarter ended March 31, 2024, and up from 3.91% for the quarter ended June 30, 2023. Average total deposits for the second quarter of 2024 were down $42.9 million, or 0.7%, compared to the first quarter of 2024, and down $128.3 million or 2.0% compared to the same period in 2023. The decrease compared to the prior quarter was mainly driven by seasonal deposit trends, while the decrease compared to the prior year was largely driven by inflation and persistent rate competition for deposits due to the current interest rate environment and tightening monetary policy. The cost of interest-bearing deposits of 2.27% for the second quarter of 2024 was up 10 basis points from 2.17% for the first quarter of 2024, and up 86 basis points from 1.41% for the second quarter of 2023. The ratio of average noninterest bearing deposits to average total deposits for the second quarter of 2024 was 29.1% compared to 28.8% for the first quarter of 2024, and 31.1% for the quarter ended June 30, 2023. The average cost of interest-bearing liabilities for the second quarter of 2024 of 2.64% represents an increase of 13 basis points over the first quarter of 2024, and an increase of 100 basis points over the same period in 2023. NONINTEREST INCOME Noninterest income represented 29.9% of total revenue for the second quarter of 2024 compared to 30.4% for the first quarter of 2024, and 19.6% for the second quarter of 2023. Noninterest income of $21.8 million for the second quarter of 2024 was up $9.2 million or 72.6% compared to the same period in 2023. Year-to-date noninterest income of $43.9 million was up $10.9 million or 33.0% compared to the same period in 2023. The increase in quarterly and year-to-date noninterest income compared to the same periods in 2023 was mainly due to a $7.1 million loss on the sale of available-for-sale securities discussed above. Also included in the increase in the second quarter of 2024 over the same period prior year are fee-based revenues which included insurance commissions and fees, up $415,000, wealth management fees, up $171,000, service charges on deposit accounts, up $126,000, and card services income, up $191,000. NONINTEREST EXPENSE Noninterest expense was $49.9 million for the second quarter of 2024, which was down $2.0 million or 3.9% compared to the second quarter of 2023. Year-to-date noninterest expense for the period ended June 30, 2024 was $99.8 million, a decrease of $2.3 million or 2.3% compared to the $102.1 million reported for the same period in 2023. The decrease was mainly driven by lower other expenses (legal fees, marketing expense, professional fees, and travel and meeting expense) and lower salaries, wages and other employee benefits in the second quarter of 2024 compared to the same period in 2023. INCOME TAX EXPENSE The provision for income tax expense was $4.9 million for an effective rate of 23.8% for the second quarter of 2024, compared to tax expense of $1.8 million and an effective rate of 17.3% for the same quarter in 2023. For the first six months of 2024, the provision for income tax expense was $10.1 million and the effective tax rate was 23.6% compared to provision expense of $7.7 million and an effective tax rate of 21.6% for the same period in 2023. Lower tax expense for both the quarter and year-to-date periods in 2023 was mainly a result of lower income associated with the loss on the sale of securities described above. ASSET QUALITY The allowance for credit losses represented 0.92% of total loans and leases at June 30, 2024, unchanged from the most recent prior quarter and December 31, 2023. The ratio of the allowance to total nonperforming loans and leases was 84.94% at June 30, 2024, compared to 82.47% at March 31, 2024, and 154.76% at June 30, 2023. The decrease in the ratio compared to the same prior year period was due to the increase in nonperforming loans and leases discussed in more detail below. Provision for credit losses for the second quarter of 2024 was $2.2 million compared to provision expense of $2.3 million for the same period in 2023. Provision for credit losses for the six months ended June 30, 2024 was $3.0 million compared to $1.4 million for the six months ended June 30, 2023. The increase in provision expense for the year-to-date period compared to the same period in 2023 was mainly driven by loan growth and changes in off balance sheet reserves driven by an increase in loan pipeline. Net charge-offs for the second quarter of 2024 were $509,000 compared to net recoveries of $27,000 reported for the same period in 2023. Nonperforming assets represented 0.79% of total assets at June 30, 2024, down from 0.81% reported at March 31, 2024, and up compared to 0.41% at June 30, 2023. At June 30, 2024, nonperforming loans and leases totaled $62.5 million, compared to $62.7 million at March 31, 2024 and $31.4 million at June 30, 2023. The increase in nonperforming loans and leases at June 30, 2024 compared to results at June 30, 2023 was mainly due to the addition in the fourth quarter of 2023 of one relationship totaling approximately $33.3 million with two commercial real estate properties included in the office space and mixed use properties portion of the commercial real estate portfolio. The Company believes that the existing collateral securing the loans is sufficient to cover the exposure as of June 30, 2024. Special Mention and Substandard loans and leases totaled $116.2 million at June 30, 2024, compared to $118.7 million reported at March 31, 2024, and $118.1 million reported at June 30, 2023. CAPITAL POSITION Capital ratios at June 30, 2024 remained well above the regulatory minimums for well-capitalized institutions. The ratio of total capital to risk-weighted assets was 13.26% at June 30, 2024, compared to 13.43% at March 31, 2024, and 14.48% at June 30, 2023. The ratio of Tier 1 capital to average assets was 9.15% at June 30, 2024, compared to 9.08% at March 31, 2024, and 9.57% at June 30, 2023. LIQUIDITY POSITION The Company's liquidity position at June 30, 2024 was stable and consistent with the immediately prior quarter. Liquidity is enhanced by ready access to national and regional wholesale funding sources including Federal funds purchased, repurchase agreements, brokered deposits, Federal Reserve Bank's Discount Window advances and Federal Home Loan Banks (FHLB) advances. The Company maintains ready access to liquidity of $1.4 billion, or 17.3% of total assets at June 30, 2024. As a member of the FHLB, the Company can use certain unencumbered mortgage-related assets and securities to secure borrowings from the FHLB. At June 30, 2024 the Company had an available borrowing capacity at the FHLB of $661.8 million. Through various programs at the Federal Reserve Bank, the Company has the ability to use certain loans and securities to secure borrowings from the Federal Reserve Bank's Discount Window. At June 30, 2024 the available borrowing capacity with the Federal Reserve Bank was $137.7 million, secured by loans. In addition to the available borrowing lines at the FHLB and Federal Reserve Bank, at June 30, 2024, the Company maintained $553.3 million of unencumbered securities which could be pledged to further enhance secured borrowing capacity. 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 and Tompkins Insurance Agencies, Inc. Tompkins Community Bank provides a full array of wealth management services under the Tompkins Financial Advisors brand, including investment management, trust and estate, financial and tax planning services. 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. The statements contained in this press release that are not statements of historical fact may include forward-looking statements that involve a number of risks and uncertainties. Forward-looking statements may be identified by use of such words as "may", "will", "estimate", "intend", "continue", "believe", "expect", "plan", "commit", or "anticipate", the negative and other variations of these terms and other similar words. Examples of forward-looking statements may include statements regarding the sufficiency of existing collateral to cover exposure related to nonperforming loans, and the strength of our balance sheet. Forward-looking statements are made based on management’s expectations and beliefs concerning future events impacting the Company and are subject to 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 and historical performance. The following factors, in addition to those listed as Risk Factors in Item 1A in 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; our ability to attract and retain deposits and other sources of liquidity; gross domestic product growth and inflation trends; 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, including the Dodd-Frank Act, and state and local government mandates; the impact of any change in the FDIC insurance assessment rate or the rules and regulations related to the calculation of the FDIC insurance assessment amount; technological developments and changes; cybersecurity incidents and threats; 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; the ability to access financial resources in the amounts, at the times, and on the terms required to support the Company's future businesses; and the economic impact of national and global events, including the response to bank failures, war and geopolitical matters (including the war in Israel and potential for broader regional conflict and the war in Ukraine), widespread protests, civil unrest, political uncertainty, and pandemics or other public health crises. 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) (Unaudited) As of As of ASSETS 06/30/2024 12/31/2023 (Audited) Cash and noninterest bearing balances due from banks $ 60,337 $ 67,212 Interest bearing balances due from banks 10,578 12,330 Cash and Cash Equivalents 70,915 79,542 Available-for-sale debt securities, at fair value (amortized cost of $1,463,965 at June 30, 2024 and $1,548,482 at December 31, 2023) 1,317,458 1,416,650 Held-to-maturity debt securities, at amortized cost (fair value of $264,588 at June 30, 2024 and $267,455 at December 31, 2023) 312,430 312,401 Equity securities, at fair value 766 787 Total loans and leases, net of unearned income and deferred costs and fees 5,761,864 5,605,935 Less: Allowance for credit losses 53,059 51,584 Net Loans and Leases 5,708,805 5,554,351 Federal Home Loan Bank and other stock 41,382 33,719 Bank premises and equipment, net 77,279 79,687 Corporate owned life insurance 75,453 67,884 Goodwill 92,602 92,602 Other intangible assets, net 2,193 2,327 Accrued interest and other assets 170,239 179,799 Total Assets $ 7,869,522 $ 7,819,749 LIABILITIES Deposits: Interest bearing: Checking, savings and money market 3,453,049 3,484,878 Time 979,292 998,013 Noninterest bearing 1,853,555 1,916,956 Total Deposits 6,285,896 6,399,847 Federal funds purchased and securities sold under agreements to repurchase 35,989 50,996 Other borrowings 773,627 602,100 Other liabilities 97,917 96,872 Total Liabilities $ 7,193,429 $ 7,149,815 EQUITY Tompkins Financial Corporation shareholders' equity: Common Stock - par value $.10 per share: Authorized 25,000,000 shares; Issued: 14,429,124 at June 30, 2024; and 14,441,830 at December 31, 2023 1,443 1,444 Additional paid-in capital 298,647 297,183 Retained earnings 516,566 501,510 Accumulated other comprehensive loss (135,670 ) (125,005 ) Treasury stock, at cost – 126,450 shares at June 30, 2024, and 132,097 shares at December 31, 2023 (6,356 ) (6,610 ) Total Tompkins Financial Corporation Shareholders’ Equity 674,630 668,522 Noncontrolling interests 1,463 1,412 Total Equity $ 676,093 $ 669,934 Total Liabilities and Equity $ 7,869,522 $ 7,819,749 TOMPKINS FINANCIAL CORPORATION CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share data) (Unaudited) Three Months Ended Six Months Ended 06/30/2024 03/31/2024 06/30/2023 06/30/2024 06/30/2023 INTEREST AND DIVIDEND INCOME Loans $ 73,646 $ 71,599 $ 63,527 $ 145,245 $ 124,369 Due from banks 184 154 183 338 322 Available-for-sale debt securities 9,371 9,611 6,618 18,982 13,361 Held-to-maturity debt securities 1,219 1,218 1,219 2,437 2,433 Federal Home Loan Bank and other stock 820 601 323 1,421 623 Total Interest and Dividend Income 85,240 $ 83,183 $ 71,870 $ 168,423 $ 141,108 INTEREST EXPENSE Time certificates of deposits of $250,000 or more 4,048 4,010 2,526 8,058 4,313 Other deposits 21,236 20,424 13,119 41,660 23,513 Federal funds purchased and securities sold under agreements to repurchase 11 13 15 24 29 Other borrowings 8,992 8,061 4,314 17,053 7,111 Total Interest Expense 34,287 32,508 19,974 66,795 34,966 Net Interest Income 50,953 50,675 51,896 101,628 106,142 Less: Provision for credit loss expense 2,172 854 2,253 3,026 1,428 Net Interest Income After Provision for Credit Loss Expense 48,781 49,821 49,643 98,602 104,714 NONINTEREST INCOME Insurance commissions and fees 9,087 10,259 8,672 19,346 18,181 Wealth management fees 4,849 4,937 4,678 9,786 9,187 Service charges on deposit accounts 1,766 1,796 1,640 3,562 3,386 Card services income 3,278 2,939 3,087 6,217 5,769 Other income 2,802 2,220 1,603 5,022 3,544 Net loss on securities transactions (6 ) (14 ) (7,065 ) (20 ) (7,052 ) Total Noninterest Income 21,776 22,137 12,615 43,913 33,015 NONINTEREST EXPENSE Salaries and wages 24,919 24,697 25,337 49,616 49,849 Other employee benefits 6,545 6,411 6,647 12,956 13,388 Net occupancy expense of premises 3,139 3,557 3,327 6,696 6,626 Furniture and fixture expense 1,910 2,125 2,105 4,035 4,159 Amortization of intangible assets 80 76 84 156 167 Other operating expense 13,349 12,991 14,468 26,340 27,937 Total Noninterest Expenses 49,942 49,857 51,968 99,799 102,126 Income Before Income Tax Expense 20,615 22,101 10,290 42,716 35,603 Income Tax Expense 4,902 5,198 1,784 10,100 7,685 Net Income Attributable to Noncontrolling Interests and Tompkins Financial Corporation 15,713 16,903 8,506 32,616 27,918 Less: Net Income Attributable to Noncontrolling Interests 31 31 31 62 62 Net Income Attributable to Tompkins Financial Corporation $ 15,682 16,872 8,475 32,554 27,856 Basic Earnings Per Share $ 1.10 $ 1.19 $ 0.59 $ 2.29 $ 1.94 Diluted Earnings Per Share $ 1.10 $ 1.18 $ 0.59 $ 2.29 $ 1.94 Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited) Quarter Ended Quarter Ended June 30, 2024 March 31, 2024 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 $ 11,707 $ 184 6.33 % $ 12,202 $ 154 5.08 % Securities (1) U.S. Government securities 1,717,975 10,067 2.36 % 1,756,122 10,303 2.36 % State and municipal (2) 89,518 566 2.55 % 89,886 570 2.55 % Other securities 3,260 59 7.32 % 3,278 60 7.32 % Total securities 1,810,753 10,692 2.38 % 1,849,286 10,933 2.38 % FHLBNY and FRB stock 37,681 820 8.76 % 34,613 601 6.99 % Total loans and leases, net of unearned income (2)(3) 5,687,548 73,839 5.22 % 5,621,604 71,779 5.14 % Total interest-earning assets 7,547,689 85,535 4.56 % 7,517,705 83,467 4.47 % Other assets 262,372 283,420 Total assets $ 7,810,061 $ 7,801,125 LIABILITIES & EQUITY Deposits Interest-bearing deposits Interest bearing checking, savings, & money market 3,498,746 15,754 1.81 % 3,546,216 15,036 1.71 % Time deposits 987,348 9,530 3.88 % 988,891 9,398 3.82 % Total interest-bearing deposits 4,486,094 25,284 2.27 % 4,535,107 24,434 2.17 % Federal funds purchased & securities sold under agreements to repurchase 40,298 11 0.11 % 48,779 13 0.10 % Other borrowings 688,611 8,992 5.25 % 622,951 8,061 5.21 % Total interest-bearing liabilities 5,215,003 34,287 2.64 % 5,206,836 32,508 2.51 % Noninterest bearing deposits 1,837,325 1,831,244 Accrued expenses and other liabilities 94,764 96,292 Total liabilities 7,147,092 7,134,373 Tompkins Financial Corporation Shareholders’ equity 661,523 665,333 Noncontrolling interest 1,446 1,419 Total equity 662,969 666,752 Total liabilities and equity $ 7,810,061 $ 7,801,125 Interest rate spread 1.91 % 1.95 % Net interest income (TE)/margin on earning assets 51,248 2.73 % 50,959 2.73 % Tax Equivalent Adjustment (295 ) (284 ) Net interest income $ 50,953 $ 50,675 Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited) Quarter Ended Quarter Ended June 30, 2024 June 30, 2023 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 $ 11,707 $ 184 6.33 % $ 13,585 $ 183 5.40 % Securities (1) U.S. Government securities 1,717,975 10,067 2.36 % 1,972,719 7,304 1.49 % State and municipal (2) 89,518 566 2.55 % 92,194 590 2.57 % Other securities 3,260 59 7.32 % 3,288 56 6.86 % Total securities 1,810,753 10,692 2.38 % 2,068,201 7,950 1.54 % FHLBNY and FRB stock 37,681 820 8.76 % 23,211 323 5.59 % Total loans and leases, net of unearned income (2)(3) 5,687,548 73,839 5.22 % 5,304,717 63,709 4.82 % Total interest-earning assets 7,547,689 85,535 4.56 % 7,409,714 72,165 3.91 % Other assets 262,372 226,086 Total assets $ 7,810,061 $ 7,635,800 LIABILITIES & EQUITY Deposits Interest-bearing deposits Interest bearing checking, savings, & money market $ 3,498,746 $ 15,754 1.81 % $ 3,701,229 $ 10,590 1.15 % Time deposits 987,348 9,530 3.88 % 745,970 5,055 2.72 % Total interest-bearing deposits 4,486,094 25,284 2.27 % 4,447,199 15,645 1.41 % Federal funds purchased & securities sold under agreements to repurchase 40,298 11 0.11 % 56,083 15 0.11 % Other borrowings 688,611 8,992 5.25 % 379,744 4,314 4.56 % Total interest-bearing liabilities 5,215,003 34,287 2.64 % 4,883,026 19,974 1.64 % Noninterest bearing deposits 1,837,325 2,004,560 Accrued expenses and other liabilities 94,764 97,660 Total liabilities 7,147,092 6,985,246 Tompkins Financial Corporation Shareholders’ equity 661,523 649,097 Noncontrolling interest 1,446 1,457 Total equity 662,969 650,554 Total liabilities and equity $ 7,810,061 $ 7,635,800 Interest rate spread 1.91 % 2.27 % Net interest income (TE)/margin on earning assets 51,248 2.73 % 52,191 2.83 % Tax Equivalent Adjustment (295 ) (295 ) Net interest income $ 50,953 $ 51,896 Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited) Year to Date Period Ended Year to Date Period Ended June 30, 2024 June 30, 2023 Average Average Balance Average Balance Average (Dollar amounts in thousands) (YTD) Interest Yield/Rate (YTD) Interest Yield/Rate ASSETS Interest-earning assets Interest-bearing balances due from banks $ 11,955 $ 338 5.69 % $ 13,161 $ 322 4.93 % Securities (1) U.S. Government securities 1,737,049 20,370 2.36 % 2,002,846 14,728 1.48 % State and municipal (2) 89,702 1,137 2.55 % 92,695 1,188 2.58 % Other securities 3,269 119 7.32 % 3,286 110 6.70 % Total securities 1,830,020 21,626 2.38 % 2,098,827 16,026 1.54 % FHLBNY and FRB stock 36,147 1,421 7.90 % 19,998 623 6.29 % Total loans and leases, net of unearned income (2)(3) 5,654,576 145,616 5.18 % 5,278,145 124,744 4.77 % Total interest-earning assets 7,532,698 169,001 4.51 % 7,410,131 141,715 3.86 % Other assets 272,895 224,671 Total assets $ 7,805,593 $ 7,634,802 LIABILITIES & EQUITY Deposits Interest-bearing deposits Interest bearing checking, savings, & money market $ 3,522,481 $ 30,790 1.76 % $ 3,767,032 $ 19,230 1.03 % Time deposits 988,119 18,928 3.85 % 710,119 8,596 2.44 % Total interest-bearing deposits 4,510,600 49,718 2.22 % 4,477,151 27,826 1.25 % Federal funds purchased & securities sold under agreements to repurchase 44,538 24 0.11 % 56,799 29 0.10 % Other borrowings 655,781 17,053 5.23 % 325,052 7,111 4.41 % Total interest-bearing liabilities 5,210,919 66,795 2.58 % 4,859,002 34,966 1.45 % Noninterest bearing deposits 1,834,284 2,034,961 Accrued expenses and other liabilities 95,529 99,905 Total liabilities 7,140,732 6,993,868 Tompkins Financial Corporation Shareholders’ equity 663,428 639,494 Noncontrolling interest 1,433 1,440 Total equity 664,861 640,934 Total liabilities and equity $ 7,805,593 $ 7,634,802 Interest rate spread 1.93 % 2.41 % Net interest income (TE)/margin on earning assets 102,206 2.73 % 106,749 2.90 % Tax Equivalent Adjustment (578 ) (607 ) Net interest income $ 101,628 $ 106,142 Tompkins Financial Corporation - Summary Financial Data (Unaudited) (In thousands, except per share data) Quarter-Ended Year-Ended Period End Balance Sheet Jun-24 Mar-24 Dec-23 Sep-23 Jun-23 Dec-23 Securities $ 1,630,654 $ 1,679,542 $ 1,729,838 $ 1,701,636 $ 1,781,150 $ 1,729,838 Total Loans 5,761,864 5,640,524 5,605,935 5,434,860 5,352,365 5,605,935 Allowance for credit losses 53,059 51,704 51,584 49,336 48,545 51,584 Total assets 7,869,522 7,778,034 7,819,749 7,691,162 7,626,238 7,819,749 Total deposits 6,285,896 6,449,616 6,399,847 6,623,436 6,454,651 6,399,847 Federal funds purchased and securities sold under agreements to repurchase 35,989 43,681 50,996 56,120 50,483 50,996 Other borrowings 773,627 522,600 602,100 296,800 387,100 602,100 Total common equity 674,630 667,906 668,522 610,851 634,967 668,522 Total equity 676,093 669,338 669,934 612,356 636,441 669,934 Average Balance Sheet Average earning assets $ 7,547,689 $ 7,517,705 $ 7,407,976 $ 7,405,434 $ 7,409,714 $ 7,408,404 Average assets 7,810,061 7,801,125 7,666,982 7,629,876 7,635,800 7,641,672 Average interest-bearing liabilities 5,215,003 5,206,836 5,020,544 4,902,930 4,883,026 4,910,792 Average equity 662,969 666,752 622,280 634,980 650,554 634,732 Share data Weighted average shares outstanding (basic) 14,214,574 14,211,910 14,194,503 14,185,763 14,314,133 14,254,661 Weighted average shares outstanding (diluted) 14,239,626 14,238,357 14,246,024 14,224,748 14,346,787 14,301,221 Period-end shares outstanding 14,395,204 14,405,019 14,405,920 14,350,177 14,405,503 14,405,920 Common equity book value per share $ 46.86 $ 46.37 $ 46.41 $ 42.57 $ 44.08 $ 46.41 Tangible book value per share (Non-GAAP)** $ 40.35 $ 39.85 $ 39.88 $ 36.01 $ 37.54 $ 39.88 **See "Non-GAAP measures" below for a discussion of non-GAAP financial measures and a reconciliation of non-GAAP financial measures to the most directly comparable financial measures presented in accordance with GAAP. Income Statement Net interest income $ 50,953 $ 50,675 $ 52,359 $ 51,013 $ 51,896 $ 209,514 Provision for credit loss expense (5) 2,172 854 1,761 1,150 2,253 4,339 Noninterest income 21,776 22,137 18,850 (41,624 ) 12,615 10,241 Noninterest expense (5) 49,942 49,857 51,300 49,866 51,968 203,292 Income tax expense/(benefit) 4,902 5,198 3,114 (8,304 ) 1,784 2,495 Net income/(loss) attributable to Tompkins Financial Corporation 15,682 16,872 15,003 (33,354 ) 8,475 9,505 Noncontrolling interests 31 31 31 31 31 124 Basic earnings (loss) per share (4) 1.10 1.19 1.06 (2.35 ) 0.59 0.66 Diluted earnings (loss) per share (4) 1.10 1.18 1.05 (2.35 ) 0.59 0.66 Nonperforming Assets Nonaccrual loans and leases $ 62,253 $ 62,544 $ 62,165 $ 31,381 $ 31,333 $ 62,165 Loans and leases 90 days past due and accruing 215 151 101 52 34 101 Total nonperforming loans and leases 62,468 62,695 62,266 31,433 31,367 62,266 OREO 80 0 131 0 36 131 Total nonperforming assets $ 62,548 $ 62,695 $ 62,397 $ 31,433 $ 31,403 $ 62,397 Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued Quarter-Ended Year-Ended Delinquency - Total loan and lease portfolio Jun-24 Mar-24 Dec-23 Sep-23 Jun-23 Dec-23 Loans and leases 30-89 days past due and accruing $ 5,286 $ 8,015 $ 4,210 $ 40,893 $ 20,255 $ 4,210 Loans and leases 90 days past due and accruing 215 151 101 52 34 101 Total loans and leases past due and accruing 5,501 8,166 4,311 40,945 20,289 4,311 Allowance for Credit Losses Balance at beginning of period $ 51,704 $ 51,584 $ 49,336 $ 48,545 $ 46,099 $ 45,934 Impact of adopting ASC 326 0 0 0 0 0 64 Provision for credit losses 1,864 348 2,658 968 2,419 $ 4,865 Net loan and lease charge-offs (recoveries) 509 228 410 177 (27 ) $ (721 ) Allowance for credit losses at end of period $ 53,059 $ 51,704 $ 51,584 $ 49,336 $ 48,545 $ 51,584 Allowance for Credit Losses - Off-Balance Sheet Exposure Balance at beginning of period $ 2,776 $ 2,270 $ 3,167 $ 2,985 $ 3,151 $ 2,796 Provision (credit) for credit losses 308 506 (897 ) 182 (166 ) $ (526 ) Allowance for credit losses at end of period $ 3,084 $ 2,776 $ 2,270 $ 3,167 $ 2,985 $ 2,270 Loan Classification - Total Portfolio Special Mention $ 48,712 $ 46,302 $ 50,368 $ 65,993 $ 56,305 $ 50,368 Substandard 67,509 72,412 72,717 56,947 61,820 72,717 Ratio Analysis Credit Quality Nonperforming loans and leases/total loans and leases 1.08 % 1.11 % 1.11 % 0.58 % 0.59 % 1.11 % Nonperforming assets/total assets 0.79 % 0.81 % 0.80 % 0.41 % 0.41 % 0.80 % Allowance for credit losses/total loans and leases 0.92 % 0.92 % 0.92 % 0.91 % 0.91 % 0.92 % Allowance/nonperforming loans and leases 84.94 % 82.47 % 82.84 % 156.96 % 154.76 % 82.84 % Net loan and lease losses (recoveries) annualized/total average loans and leases 0.04 % 0.02 % 0.03 % 0.01 % 0.00 % (0.01 )% Capital Adequacy Tier 1 Capital (to average assets) 9.15 % 9.08 % 9.08 % 9.01 % 9.57 % 9.08 % Total Capital (to risk-weighted assets) 13.26 % 13.43 % 13.36 % 13.46 % 14.48 % 13.36 % Profitability (period-end) Return on average assets * 0.81 % 0.87 % 0.78 % (1.73 )% 0.45 % 0.12 % Return on average equity * 9.51 % 10.18 % 9.56 % (20.84 )% 5.22 % 1.50 % Net interest margin (TE) * 2.73 % 2.73 % 2.82 % 2.75 % 2.83 % 2.84 % Average yield on interest-earning assets* 4.56 % 4.47 % 4.34 % 4.06 % 3.91 % 4.03 % Average cost of deposits* 1.61 % 1.54 % 1.43 % 1.20 % 0.97 % 1.09 % Average cost of funds* 1.96 % 1.86 % 1.62 % 1.41 % 1.16 % 1.27 % * Quarterly ratios have been annualized Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued Non-GAAP Measures This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principals (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 below tables. The Company believes the non-GAAP measures provide meaningful comparisons of our underlying operational performance and facilitate management's and investors' assessments of business and performance trends in comparison to others in the financial services industry. These non-GAAP financial measures should not be considered in isolation or as a measure of the Company's profitability or liquidity; they are in addition to, and are not a substitute for, financial measures under GAAP. The non-GAAP financial measures presented herein may be different from non-GAAP financial measures used by other companies, and may not be comparable to similarly titled measures reported by other companies. Further, the Company may utilize other measures to illustrate performance in the future. Non-GAAP financial measures have limitations since they do not reflect all of the amounts associated with the Company's results of operations as determined in accordance with GAAP. Reconciliation of Tangible Book Value Per Share (non-GAAP) to Common Equity Book Value Per Share (GAAP) Quarter-Ended Year-Ended Jun-24 Mar-24 Dec-23 Sep-23 Jun-23 Dec-23 Total common equity $ 674,630 $ 667,906 $ 668,522 $ 610,851 $ 634,967 $ 668,522 Less: Goodwill and intangibles 93,847 93,926 94,003 94,086 94,169 94,003 Tangible common equity (Non-GAAP) 580,783 573,980 574,519 516,765 540,798 574,519 Ending shares outstanding 14,395,204 14,405,019 14,405,920 14,350,177 14,405,503 14,405,920 Tangible book value per share (Non-GAAP) $ 40.35 $ 39.85 $ 39.88 $ 36.01 $ 37.54 $ 39.88 (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 2024 and 2023 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, 2023. (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. View source version on businesswire.com: https://www.businesswire.com/news/home/20240726210452/en/Contacts For more information: Stephen S. Romaine, President & CEO Matthew Tomazin, Executive VP, CFO & Treasurer Tompkins Financial Corporation (888) 503-5753
Tompkins Financial Corporation (NYSE American: TMP) Tompkins Financial Corporation ("Tompkins" or the "Company") reported diluted earnings per share of $1.10 for the second quarter of 2024, down 6.8% from the immediate prior quarter, and up 86.4% from diluted earnings per share of $0.59 reported in the second quarter of 2023. Net income for the second quarter of 2024 was $15.7 million, down $1.2 million or 7.1% compared to the most recent prior quarter, and up $7.2 million, or 85.0%, when compared to the $8.5 million reported for the same period in 2023. The increase in diluted earnings per share and net income compared to the results for the second quarter of 2023 largely reflects the Company's sale of $80.9 million of available-for-sale securities which resulted in a $7.1 million (or $0.37 per share) loss on securities transactions in the second quarter of 2023. For the six months ended June 30, 2024, diluted earnings per share were $2.29, up 18.0% from $1.94 for the six months ended June 30, 2023. Year-to-date net income was $32.6 million for the six month period ended June 30, 2024, up $4.7 million, or 16.9%, when compared to $27.9 million for the same six month period in 2023. The growth in year-to-date diluted earnings per share and net income relative to the year-to-date results for the same six month period in 2023 is similarly attributable to the impact caused by the loss on securities transactions described above. Tompkins President and CEO, Stephen Romaine, commented, "Our year to date and second quarter results have been positively impacted by a stabilizing net interest margin and growth throughout our business. Year over year loans are up 7.7% and year to date noninterest income was up 33%, or 10% excluding the impact from the loss on the sale of securities in the second quarter of 2023. We have remained focused on expenses with noninterest expenses year to date lower by 2.3%. As we continue to leverage our balance sheet we are seeing strengthening operating results with stabilizing and growing revenue and lower expenses. We look forward to driving growth through quality customer relationships supported by our strong capital and liquidity." SELECTED HIGHLIGHTS FOR THE PERIOD: Net interest margin for the second quarter of 2024 was 2.73%, unchanged from the first quarter of 2024, and down from 2.83% for the second quarter of 2023. Total cost of funds was up 10 basis points compared to the first quarter 2024, down from a 24 basis point increase from the fourth quarter of 2023 to the first quarter of 2024. Fee-based services (insurance, wealth management, service charges on deposit accounts and cards) revenues for the second quarter of 2024 were up $903,000 or 5.0% compared to the second quarter of 2023. Total operating expenses of $49.9 million for the second quarter of 2024 were in line with the most recent prior quarter, and down $2.0 million or 3.9% compared to the second quarter of 2023. Total loans at June 30, 2024 were up $121.3 million, or 2.2% (8.7% on an annualized basis) compared to the immediate prior quarter, and up $409.5 million, or 7.7%, from June 30, 2023. Total deposits at June 30, 2024 were $6.3 billion, down $163.7 million, or 2.5% from March 31, 2024, and $168.8 million, or 2.6%, from June 30, 2023. Loan to deposit ratio at June 30, 2024 was 91.7%, compared to 87.5% for the immediate prior quarter. Regulatory Tier 1 capital to average assets was 9.15% at June 30, 2024, up compared to 9.08% reported at March 31, 2024, and down compared to 9.57% at June 30, 2023. NET INTEREST INCOME Net interest income was $51.0 million for the second quarter of 2024, up from $50.7 million for the first quarter of 2024, and down from $51.9 million for the second quarter of 2023. Net interest income for the quarter ended June 30, 2024 was impacted by increases in interest expense, which totaled $34.3 million for the second quarter of 2024 compared to $20.0 million for the same period in 2023, partially offset by increased interest and dividend income, which increased by $13.4 million when compared to the second quarter of 2023. For the six months ended June 30, 2024, net interest income was $101.6 million, down $4.5 million or 4.3% when compared to the same period in 2023. Net interest margin was 2.73% for the second quarter of 2024, unchanged from the first quarter of 2024, and down from the 2.83% reported for the second quarter of 2023. The decrease in net interest margin, when compared to the prior year, was mainly driven by higher funding costs, driven by market rates and higher borrowings due to lower deposit balances, and was partially offset by higher yields on interest earnings assets. Average loans for the quarter ended June 30, 2024 were up $65.9 million, or 1.2%, from the first quarter of 2024, and were up $382.8 million, or 7.2%, compared to the prior year second quarter. The increase in average loans over both prior periods was mainly in the commercial real estate and commercial and industrial portfolios. The average yield on interest-earning assets for the quarter ended June 30, 2024 was 4.56%, which was up from 4.47% for the prior quarter ended March 31, 2024, and up from 3.91% for the quarter ended June 30, 2023. Average total deposits for the second quarter of 2024 were down $42.9 million, or 0.7%, compared to the first quarter of 2024, and down $128.3 million or 2.0% compared to the same period in 2023. The decrease compared to the prior quarter was mainly driven by seasonal deposit trends, while the decrease compared to the prior year was largely driven by inflation and persistent rate competition for deposits due to the current interest rate environment and tightening monetary policy. The cost of interest-bearing deposits of 2.27% for the second quarter of 2024 was up 10 basis points from 2.17% for the first quarter of 2024, and up 86 basis points from 1.41% for the second quarter of 2023. The ratio of average noninterest bearing deposits to average total deposits for the second quarter of 2024 was 29.1% compared to 28.8% for the first quarter of 2024, and 31.1% for the quarter ended June 30, 2023. The average cost of interest-bearing liabilities for the second quarter of 2024 of 2.64% represents an increase of 13 basis points over the first quarter of 2024, and an increase of 100 basis points over the same period in 2023. NONINTEREST INCOME Noninterest income represented 29.9% of total revenue for the second quarter of 2024 compared to 30.4% for the first quarter of 2024, and 19.6% for the second quarter of 2023. Noninterest income of $21.8 million for the second quarter of 2024 was up $9.2 million or 72.6% compared to the same period in 2023. Year-to-date noninterest income of $43.9 million was up $10.9 million or 33.0% compared to the same period in 2023. The increase in quarterly and year-to-date noninterest income compared to the same periods in 2023 was mainly due to a $7.1 million loss on the sale of available-for-sale securities discussed above. Also included in the increase in the second quarter of 2024 over the same period prior year are fee-based revenues which included insurance commissions and fees, up $415,000, wealth management fees, up $171,000, service charges on deposit accounts, up $126,000, and card services income, up $191,000. NONINTEREST EXPENSE Noninterest expense was $49.9 million for the second quarter of 2024, which was down $2.0 million or 3.9% compared to the second quarter of 2023. Year-to-date noninterest expense for the period ended June 30, 2024 was $99.8 million, a decrease of $2.3 million or 2.3% compared to the $102.1 million reported for the same period in 2023. The decrease was mainly driven by lower other expenses (legal fees, marketing expense, professional fees, and travel and meeting expense) and lower salaries, wages and other employee benefits in the second quarter of 2024 compared to the same period in 2023. INCOME TAX EXPENSE The provision for income tax expense was $4.9 million for an effective rate of 23.8% for the second quarter of 2024, compared to tax expense of $1.8 million and an effective rate of 17.3% for the same quarter in 2023. For the first six months of 2024, the provision for income tax expense was $10.1 million and the effective tax rate was 23.6% compared to provision expense of $7.7 million and an effective tax rate of 21.6% for the same period in 2023. Lower tax expense for both the quarter and year-to-date periods in 2023 was mainly a result of lower income associated with the loss on the sale of securities described above. ASSET QUALITY The allowance for credit losses represented 0.92% of total loans and leases at June 30, 2024, unchanged from the most recent prior quarter and December 31, 2023. The ratio of the allowance to total nonperforming loans and leases was 84.94% at June 30, 2024, compared to 82.47% at March 31, 2024, and 154.76% at June 30, 2023. The decrease in the ratio compared to the same prior year period was due to the increase in nonperforming loans and leases discussed in more detail below. Provision for credit losses for the second quarter of 2024 was $2.2 million compared to provision expense of $2.3 million for the same period in 2023. Provision for credit losses for the six months ended June 30, 2024 was $3.0 million compared to $1.4 million for the six months ended June 30, 2023. The increase in provision expense for the year-to-date period compared to the same period in 2023 was mainly driven by loan growth and changes in off balance sheet reserves driven by an increase in loan pipeline. Net charge-offs for the second quarter of 2024 were $509,000 compared to net recoveries of $27,000 reported for the same period in 2023. Nonperforming assets represented 0.79% of total assets at June 30, 2024, down from 0.81% reported at March 31, 2024, and up compared to 0.41% at June 30, 2023. At June 30, 2024, nonperforming loans and leases totaled $62.5 million, compared to $62.7 million at March 31, 2024 and $31.4 million at June 30, 2023. The increase in nonperforming loans and leases at June 30, 2024 compared to results at June 30, 2023 was mainly due to the addition in the fourth quarter of 2023 of one relationship totaling approximately $33.3 million with two commercial real estate properties included in the office space and mixed use properties portion of the commercial real estate portfolio. The Company believes that the existing collateral securing the loans is sufficient to cover the exposure as of June 30, 2024. Special Mention and Substandard loans and leases totaled $116.2 million at June 30, 2024, compared to $118.7 million reported at March 31, 2024, and $118.1 million reported at June 30, 2023. CAPITAL POSITION Capital ratios at June 30, 2024 remained well above the regulatory minimums for well-capitalized institutions. The ratio of total capital to risk-weighted assets was 13.26% at June 30, 2024, compared to 13.43% at March 31, 2024, and 14.48% at June 30, 2023. The ratio of Tier 1 capital to average assets was 9.15% at June 30, 2024, compared to 9.08% at March 31, 2024, and 9.57% at June 30, 2023. LIQUIDITY POSITION The Company's liquidity position at June 30, 2024 was stable and consistent with the immediately prior quarter. Liquidity is enhanced by ready access to national and regional wholesale funding sources including Federal funds purchased, repurchase agreements, brokered deposits, Federal Reserve Bank's Discount Window advances and Federal Home Loan Banks (FHLB) advances. The Company maintains ready access to liquidity of $1.4 billion, or 17.3% of total assets at June 30, 2024. As a member of the FHLB, the Company can use certain unencumbered mortgage-related assets and securities to secure borrowings from the FHLB. At June 30, 2024 the Company had an available borrowing capacity at the FHLB of $661.8 million. Through various programs at the Federal Reserve Bank, the Company has the ability to use certain loans and securities to secure borrowings from the Federal Reserve Bank's Discount Window. At June 30, 2024 the available borrowing capacity with the Federal Reserve Bank was $137.7 million, secured by loans. In addition to the available borrowing lines at the FHLB and Federal Reserve Bank, at June 30, 2024, the Company maintained $553.3 million of unencumbered securities which could be pledged to further enhance secured borrowing capacity. 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 and Tompkins Insurance Agencies, Inc. Tompkins Community Bank provides a full array of wealth management services under the Tompkins Financial Advisors brand, including investment management, trust and estate, financial and tax planning services. 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. The statements contained in this press release that are not statements of historical fact may include forward-looking statements that involve a number of risks and uncertainties. Forward-looking statements may be identified by use of such words as "may", "will", "estimate", "intend", "continue", "believe", "expect", "plan", "commit", or "anticipate", the negative and other variations of these terms and other similar words. Examples of forward-looking statements may include statements regarding the sufficiency of existing collateral to cover exposure related to nonperforming loans, and the strength of our balance sheet. Forward-looking statements are made based on management’s expectations and beliefs concerning future events impacting the Company and are subject to 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 and historical performance. The following factors, in addition to those listed as Risk Factors in Item 1A in 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; our ability to attract and retain deposits and other sources of liquidity; gross domestic product growth and inflation trends; 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, including the Dodd-Frank Act, and state and local government mandates; the impact of any change in the FDIC insurance assessment rate or the rules and regulations related to the calculation of the FDIC insurance assessment amount; technological developments and changes; cybersecurity incidents and threats; 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; the ability to access financial resources in the amounts, at the times, and on the terms required to support the Company's future businesses; and the economic impact of national and global events, including the response to bank failures, war and geopolitical matters (including the war in Israel and potential for broader regional conflict and the war in Ukraine), widespread protests, civil unrest, political uncertainty, and pandemics or other public health crises. 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) (Unaudited) As of As of ASSETS 06/30/2024 12/31/2023 (Audited) Cash and noninterest bearing balances due from banks $ 60,337 $ 67,212 Interest bearing balances due from banks 10,578 12,330 Cash and Cash Equivalents 70,915 79,542 Available-for-sale debt securities, at fair value (amortized cost of $1,463,965 at June 30, 2024 and $1,548,482 at December 31, 2023) 1,317,458 1,416,650 Held-to-maturity debt securities, at amortized cost (fair value of $264,588 at June 30, 2024 and $267,455 at December 31, 2023) 312,430 312,401 Equity securities, at fair value 766 787 Total loans and leases, net of unearned income and deferred costs and fees 5,761,864 5,605,935 Less: Allowance for credit losses 53,059 51,584 Net Loans and Leases 5,708,805 5,554,351 Federal Home Loan Bank and other stock 41,382 33,719 Bank premises and equipment, net 77,279 79,687 Corporate owned life insurance 75,453 67,884 Goodwill 92,602 92,602 Other intangible assets, net 2,193 2,327 Accrued interest and other assets 170,239 179,799 Total Assets $ 7,869,522 $ 7,819,749 LIABILITIES Deposits: Interest bearing: Checking, savings and money market 3,453,049 3,484,878 Time 979,292 998,013 Noninterest bearing 1,853,555 1,916,956 Total Deposits 6,285,896 6,399,847 Federal funds purchased and securities sold under agreements to repurchase 35,989 50,996 Other borrowings 773,627 602,100 Other liabilities 97,917 96,872 Total Liabilities $ 7,193,429 $ 7,149,815 EQUITY Tompkins Financial Corporation shareholders' equity: Common Stock - par value $.10 per share: Authorized 25,000,000 shares; Issued: 14,429,124 at June 30, 2024; and 14,441,830 at December 31, 2023 1,443 1,444 Additional paid-in capital 298,647 297,183 Retained earnings 516,566 501,510 Accumulated other comprehensive loss (135,670 ) (125,005 ) Treasury stock, at cost – 126,450 shares at June 30, 2024, and 132,097 shares at December 31, 2023 (6,356 ) (6,610 ) Total Tompkins Financial Corporation Shareholders’ Equity 674,630 668,522 Noncontrolling interests 1,463 1,412 Total Equity $ 676,093 $ 669,934 Total Liabilities and Equity $ 7,869,522 $ 7,819,749 TOMPKINS FINANCIAL CORPORATION CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share data) (Unaudited) Three Months Ended Six Months Ended 06/30/2024 03/31/2024 06/30/2023 06/30/2024 06/30/2023 INTEREST AND DIVIDEND INCOME Loans $ 73,646 $ 71,599 $ 63,527 $ 145,245 $ 124,369 Due from banks 184 154 183 338 322 Available-for-sale debt securities 9,371 9,611 6,618 18,982 13,361 Held-to-maturity debt securities 1,219 1,218 1,219 2,437 2,433 Federal Home Loan Bank and other stock 820 601 323 1,421 623 Total Interest and Dividend Income 85,240 $ 83,183 $ 71,870 $ 168,423 $ 141,108 INTEREST EXPENSE Time certificates of deposits of $250,000 or more 4,048 4,010 2,526 8,058 4,313 Other deposits 21,236 20,424 13,119 41,660 23,513 Federal funds purchased and securities sold under agreements to repurchase 11 13 15 24 29 Other borrowings 8,992 8,061 4,314 17,053 7,111 Total Interest Expense 34,287 32,508 19,974 66,795 34,966 Net Interest Income 50,953 50,675 51,896 101,628 106,142 Less: Provision for credit loss expense 2,172 854 2,253 3,026 1,428 Net Interest Income After Provision for Credit Loss Expense 48,781 49,821 49,643 98,602 104,714 NONINTEREST INCOME Insurance commissions and fees 9,087 10,259 8,672 19,346 18,181 Wealth management fees 4,849 4,937 4,678 9,786 9,187 Service charges on deposit accounts 1,766 1,796 1,640 3,562 3,386 Card services income 3,278 2,939 3,087 6,217 5,769 Other income 2,802 2,220 1,603 5,022 3,544 Net loss on securities transactions (6 ) (14 ) (7,065 ) (20 ) (7,052 ) Total Noninterest Income 21,776 22,137 12,615 43,913 33,015 NONINTEREST EXPENSE Salaries and wages 24,919 24,697 25,337 49,616 49,849 Other employee benefits 6,545 6,411 6,647 12,956 13,388 Net occupancy expense of premises 3,139 3,557 3,327 6,696 6,626 Furniture and fixture expense 1,910 2,125 2,105 4,035 4,159 Amortization of intangible assets 80 76 84 156 167 Other operating expense 13,349 12,991 14,468 26,340 27,937 Total Noninterest Expenses 49,942 49,857 51,968 99,799 102,126 Income Before Income Tax Expense 20,615 22,101 10,290 42,716 35,603 Income Tax Expense 4,902 5,198 1,784 10,100 7,685 Net Income Attributable to Noncontrolling Interests and Tompkins Financial Corporation 15,713 16,903 8,506 32,616 27,918 Less: Net Income Attributable to Noncontrolling Interests 31 31 31 62 62 Net Income Attributable to Tompkins Financial Corporation $ 15,682 16,872 8,475 32,554 27,856 Basic Earnings Per Share $ 1.10 $ 1.19 $ 0.59 $ 2.29 $ 1.94 Diluted Earnings Per Share $ 1.10 $ 1.18 $ 0.59 $ 2.29 $ 1.94 Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited) Quarter Ended Quarter Ended June 30, 2024 March 31, 2024 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 $ 11,707 $ 184 6.33 % $ 12,202 $ 154 5.08 % Securities (1) U.S. Government securities 1,717,975 10,067 2.36 % 1,756,122 10,303 2.36 % State and municipal (2) 89,518 566 2.55 % 89,886 570 2.55 % Other securities 3,260 59 7.32 % 3,278 60 7.32 % Total securities 1,810,753 10,692 2.38 % 1,849,286 10,933 2.38 % FHLBNY and FRB stock 37,681 820 8.76 % 34,613 601 6.99 % Total loans and leases, net of unearned income (2)(3) 5,687,548 73,839 5.22 % 5,621,604 71,779 5.14 % Total interest-earning assets 7,547,689 85,535 4.56 % 7,517,705 83,467 4.47 % Other assets 262,372 283,420 Total assets $ 7,810,061 $ 7,801,125 LIABILITIES & EQUITY Deposits Interest-bearing deposits Interest bearing checking, savings, & money market 3,498,746 15,754 1.81 % 3,546,216 15,036 1.71 % Time deposits 987,348 9,530 3.88 % 988,891 9,398 3.82 % Total interest-bearing deposits 4,486,094 25,284 2.27 % 4,535,107 24,434 2.17 % Federal funds purchased & securities sold under agreements to repurchase 40,298 11 0.11 % 48,779 13 0.10 % Other borrowings 688,611 8,992 5.25 % 622,951 8,061 5.21 % Total interest-bearing liabilities 5,215,003 34,287 2.64 % 5,206,836 32,508 2.51 % Noninterest bearing deposits 1,837,325 1,831,244 Accrued expenses and other liabilities 94,764 96,292 Total liabilities 7,147,092 7,134,373 Tompkins Financial Corporation Shareholders’ equity 661,523 665,333 Noncontrolling interest 1,446 1,419 Total equity 662,969 666,752 Total liabilities and equity $ 7,810,061 $ 7,801,125 Interest rate spread 1.91 % 1.95 % Net interest income (TE)/margin on earning assets 51,248 2.73 % 50,959 2.73 % Tax Equivalent Adjustment (295 ) (284 ) Net interest income $ 50,953 $ 50,675 Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited) Quarter Ended Quarter Ended June 30, 2024 June 30, 2023 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 $ 11,707 $ 184 6.33 % $ 13,585 $ 183 5.40 % Securities (1) U.S. Government securities 1,717,975 10,067 2.36 % 1,972,719 7,304 1.49 % State and municipal (2) 89,518 566 2.55 % 92,194 590 2.57 % Other securities 3,260 59 7.32 % 3,288 56 6.86 % Total securities 1,810,753 10,692 2.38 % 2,068,201 7,950 1.54 % FHLBNY and FRB stock 37,681 820 8.76 % 23,211 323 5.59 % Total loans and leases, net of unearned income (2)(3) 5,687,548 73,839 5.22 % 5,304,717 63,709 4.82 % Total interest-earning assets 7,547,689 85,535 4.56 % 7,409,714 72,165 3.91 % Other assets 262,372 226,086 Total assets $ 7,810,061 $ 7,635,800 LIABILITIES & EQUITY Deposits Interest-bearing deposits Interest bearing checking, savings, & money market $ 3,498,746 $ 15,754 1.81 % $ 3,701,229 $ 10,590 1.15 % Time deposits 987,348 9,530 3.88 % 745,970 5,055 2.72 % Total interest-bearing deposits 4,486,094 25,284 2.27 % 4,447,199 15,645 1.41 % Federal funds purchased & securities sold under agreements to repurchase 40,298 11 0.11 % 56,083 15 0.11 % Other borrowings 688,611 8,992 5.25 % 379,744 4,314 4.56 % Total interest-bearing liabilities 5,215,003 34,287 2.64 % 4,883,026 19,974 1.64 % Noninterest bearing deposits 1,837,325 2,004,560 Accrued expenses and other liabilities 94,764 97,660 Total liabilities 7,147,092 6,985,246 Tompkins Financial Corporation Shareholders’ equity 661,523 649,097 Noncontrolling interest 1,446 1,457 Total equity 662,969 650,554 Total liabilities and equity $ 7,810,061 $ 7,635,800 Interest rate spread 1.91 % 2.27 % Net interest income (TE)/margin on earning assets 51,248 2.73 % 52,191 2.83 % Tax Equivalent Adjustment (295 ) (295 ) Net interest income $ 50,953 $ 51,896 Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited) Year to Date Period Ended Year to Date Period Ended June 30, 2024 June 30, 2023 Average Average Balance Average Balance Average (Dollar amounts in thousands) (YTD) Interest Yield/Rate (YTD) Interest Yield/Rate ASSETS Interest-earning assets Interest-bearing balances due from banks $ 11,955 $ 338 5.69 % $ 13,161 $ 322 4.93 % Securities (1) U.S. Government securities 1,737,049 20,370 2.36 % 2,002,846 14,728 1.48 % State and municipal (2) 89,702 1,137 2.55 % 92,695 1,188 2.58 % Other securities 3,269 119 7.32 % 3,286 110 6.70 % Total securities 1,830,020 21,626 2.38 % 2,098,827 16,026 1.54 % FHLBNY and FRB stock 36,147 1,421 7.90 % 19,998 623 6.29 % Total loans and leases, net of unearned income (2)(3) 5,654,576 145,616 5.18 % 5,278,145 124,744 4.77 % Total interest-earning assets 7,532,698 169,001 4.51 % 7,410,131 141,715 3.86 % Other assets 272,895 224,671 Total assets $ 7,805,593 $ 7,634,802 LIABILITIES & EQUITY Deposits Interest-bearing deposits Interest bearing checking, savings, & money market $ 3,522,481 $ 30,790 1.76 % $ 3,767,032 $ 19,230 1.03 % Time deposits 988,119 18,928 3.85 % 710,119 8,596 2.44 % Total interest-bearing deposits 4,510,600 49,718 2.22 % 4,477,151 27,826 1.25 % Federal funds purchased & securities sold under agreements to repurchase 44,538 24 0.11 % 56,799 29 0.10 % Other borrowings 655,781 17,053 5.23 % 325,052 7,111 4.41 % Total interest-bearing liabilities 5,210,919 66,795 2.58 % 4,859,002 34,966 1.45 % Noninterest bearing deposits 1,834,284 2,034,961 Accrued expenses and other liabilities 95,529 99,905 Total liabilities 7,140,732 6,993,868 Tompkins Financial Corporation Shareholders’ equity 663,428 639,494 Noncontrolling interest 1,433 1,440 Total equity 664,861 640,934 Total liabilities and equity $ 7,805,593 $ 7,634,802 Interest rate spread 1.93 % 2.41 % Net interest income (TE)/margin on earning assets 102,206 2.73 % 106,749 2.90 % Tax Equivalent Adjustment (578 ) (607 ) Net interest income $ 101,628 $ 106,142 Tompkins Financial Corporation - Summary Financial Data (Unaudited) (In thousands, except per share data) Quarter-Ended Year-Ended Period End Balance Sheet Jun-24 Mar-24 Dec-23 Sep-23 Jun-23 Dec-23 Securities $ 1,630,654 $ 1,679,542 $ 1,729,838 $ 1,701,636 $ 1,781,150 $ 1,729,838 Total Loans 5,761,864 5,640,524 5,605,935 5,434,860 5,352,365 5,605,935 Allowance for credit losses 53,059 51,704 51,584 49,336 48,545 51,584 Total assets 7,869,522 7,778,034 7,819,749 7,691,162 7,626,238 7,819,749 Total deposits 6,285,896 6,449,616 6,399,847 6,623,436 6,454,651 6,399,847 Federal funds purchased and securities sold under agreements to repurchase 35,989 43,681 50,996 56,120 50,483 50,996 Other borrowings 773,627 522,600 602,100 296,800 387,100 602,100 Total common equity 674,630 667,906 668,522 610,851 634,967 668,522 Total equity 676,093 669,338 669,934 612,356 636,441 669,934 Average Balance Sheet Average earning assets $ 7,547,689 $ 7,517,705 $ 7,407,976 $ 7,405,434 $ 7,409,714 $ 7,408,404 Average assets 7,810,061 7,801,125 7,666,982 7,629,876 7,635,800 7,641,672 Average interest-bearing liabilities 5,215,003 5,206,836 5,020,544 4,902,930 4,883,026 4,910,792 Average equity 662,969 666,752 622,280 634,980 650,554 634,732 Share data Weighted average shares outstanding (basic) 14,214,574 14,211,910 14,194,503 14,185,763 14,314,133 14,254,661 Weighted average shares outstanding (diluted) 14,239,626 14,238,357 14,246,024 14,224,748 14,346,787 14,301,221 Period-end shares outstanding 14,395,204 14,405,019 14,405,920 14,350,177 14,405,503 14,405,920 Common equity book value per share $ 46.86 $ 46.37 $ 46.41 $ 42.57 $ 44.08 $ 46.41 Tangible book value per share (Non-GAAP)** $ 40.35 $ 39.85 $ 39.88 $ 36.01 $ 37.54 $ 39.88 **See "Non-GAAP measures" below for a discussion of non-GAAP financial measures and a reconciliation of non-GAAP financial measures to the most directly comparable financial measures presented in accordance with GAAP. Income Statement Net interest income $ 50,953 $ 50,675 $ 52,359 $ 51,013 $ 51,896 $ 209,514 Provision for credit loss expense (5) 2,172 854 1,761 1,150 2,253 4,339 Noninterest income 21,776 22,137 18,850 (41,624 ) 12,615 10,241 Noninterest expense (5) 49,942 49,857 51,300 49,866 51,968 203,292 Income tax expense/(benefit) 4,902 5,198 3,114 (8,304 ) 1,784 2,495 Net income/(loss) attributable to Tompkins Financial Corporation 15,682 16,872 15,003 (33,354 ) 8,475 9,505 Noncontrolling interests 31 31 31 31 31 124 Basic earnings (loss) per share (4) 1.10 1.19 1.06 (2.35 ) 0.59 0.66 Diluted earnings (loss) per share (4) 1.10 1.18 1.05 (2.35 ) 0.59 0.66 Nonperforming Assets Nonaccrual loans and leases $ 62,253 $ 62,544 $ 62,165 $ 31,381 $ 31,333 $ 62,165 Loans and leases 90 days past due and accruing 215 151 101 52 34 101 Total nonperforming loans and leases 62,468 62,695 62,266 31,433 31,367 62,266 OREO 80 0 131 0 36 131 Total nonperforming assets $ 62,548 $ 62,695 $ 62,397 $ 31,433 $ 31,403 $ 62,397 Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued Quarter-Ended Year-Ended Delinquency - Total loan and lease portfolio Jun-24 Mar-24 Dec-23 Sep-23 Jun-23 Dec-23 Loans and leases 30-89 days past due and accruing $ 5,286 $ 8,015 $ 4,210 $ 40,893 $ 20,255 $ 4,210 Loans and leases 90 days past due and accruing 215 151 101 52 34 101 Total loans and leases past due and accruing 5,501 8,166 4,311 40,945 20,289 4,311 Allowance for Credit Losses Balance at beginning of period $ 51,704 $ 51,584 $ 49,336 $ 48,545 $ 46,099 $ 45,934 Impact of adopting ASC 326 0 0 0 0 0 64 Provision for credit losses 1,864 348 2,658 968 2,419 $ 4,865 Net loan and lease charge-offs (recoveries) 509 228 410 177 (27 ) $ (721 ) Allowance for credit losses at end of period $ 53,059 $ 51,704 $ 51,584 $ 49,336 $ 48,545 $ 51,584 Allowance for Credit Losses - Off-Balance Sheet Exposure Balance at beginning of period $ 2,776 $ 2,270 $ 3,167 $ 2,985 $ 3,151 $ 2,796 Provision (credit) for credit losses 308 506 (897 ) 182 (166 ) $ (526 ) Allowance for credit losses at end of period $ 3,084 $ 2,776 $ 2,270 $ 3,167 $ 2,985 $ 2,270 Loan Classification - Total Portfolio Special Mention $ 48,712 $ 46,302 $ 50,368 $ 65,993 $ 56,305 $ 50,368 Substandard 67,509 72,412 72,717 56,947 61,820 72,717 Ratio Analysis Credit Quality Nonperforming loans and leases/total loans and leases 1.08 % 1.11 % 1.11 % 0.58 % 0.59 % 1.11 % Nonperforming assets/total assets 0.79 % 0.81 % 0.80 % 0.41 % 0.41 % 0.80 % Allowance for credit losses/total loans and leases 0.92 % 0.92 % 0.92 % 0.91 % 0.91 % 0.92 % Allowance/nonperforming loans and leases 84.94 % 82.47 % 82.84 % 156.96 % 154.76 % 82.84 % Net loan and lease losses (recoveries) annualized/total average loans and leases 0.04 % 0.02 % 0.03 % 0.01 % 0.00 % (0.01 )% Capital Adequacy Tier 1 Capital (to average assets) 9.15 % 9.08 % 9.08 % 9.01 % 9.57 % 9.08 % Total Capital (to risk-weighted assets) 13.26 % 13.43 % 13.36 % 13.46 % 14.48 % 13.36 % Profitability (period-end) Return on average assets * 0.81 % 0.87 % 0.78 % (1.73 )% 0.45 % 0.12 % Return on average equity * 9.51 % 10.18 % 9.56 % (20.84 )% 5.22 % 1.50 % Net interest margin (TE) * 2.73 % 2.73 % 2.82 % 2.75 % 2.83 % 2.84 % Average yield on interest-earning assets* 4.56 % 4.47 % 4.34 % 4.06 % 3.91 % 4.03 % Average cost of deposits* 1.61 % 1.54 % 1.43 % 1.20 % 0.97 % 1.09 % Average cost of funds* 1.96 % 1.86 % 1.62 % 1.41 % 1.16 % 1.27 % * Quarterly ratios have been annualized Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued Non-GAAP Measures This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principals (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 below tables. The Company believes the non-GAAP measures provide meaningful comparisons of our underlying operational performance and facilitate management's and investors' assessments of business and performance trends in comparison to others in the financial services industry. These non-GAAP financial measures should not be considered in isolation or as a measure of the Company's profitability or liquidity; they are in addition to, and are not a substitute for, financial measures under GAAP. The non-GAAP financial measures presented herein may be different from non-GAAP financial measures used by other companies, and may not be comparable to similarly titled measures reported by other companies. Further, the Company may utilize other measures to illustrate performance in the future. Non-GAAP financial measures have limitations since they do not reflect all of the amounts associated with the Company's results of operations as determined in accordance with GAAP. Reconciliation of Tangible Book Value Per Share (non-GAAP) to Common Equity Book Value Per Share (GAAP) Quarter-Ended Year-Ended Jun-24 Mar-24 Dec-23 Sep-23 Jun-23 Dec-23 Total common equity $ 674,630 $ 667,906 $ 668,522 $ 610,851 $ 634,967 $ 668,522 Less: Goodwill and intangibles 93,847 93,926 94,003 94,086 94,169 94,003 Tangible common equity (Non-GAAP) 580,783 573,980 574,519 516,765 540,798 574,519 Ending shares outstanding 14,395,204 14,405,019 14,405,920 14,350,177 14,405,503 14,405,920 Tangible book value per share (Non-GAAP) $ 40.35 $ 39.85 $ 39.88 $ 36.01 $ 37.54 $ 39.88 (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 2024 and 2023 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, 2023. (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. View source version on businesswire.com: https://www.businesswire.com/news/home/20240726210452/en/
For more information: Stephen S. Romaine, President & CEO Matthew Tomazin, Executive VP, CFO & Treasurer Tompkins Financial Corporation (888) 503-5753