SOURCE: NBT Bancorp Inc.

April 27, 2009 17:38 ET

NBT Bancorp Inc. Announces First Quarter Earnings of $0.40 per Diluted Share; Declares Cash Dividend

NORWICH, NY--(Marketwire - April 27, 2009) - NBT Bancorp Inc. (NBT) (NASDAQ: NBTB) reported today that net income for the three months ended March 31, 2009 was $13.1 million, down $0.6 million, or 4.7%, from net income of $13.7 million reported for the same period in 2008. Net income per diluted share for the three months ended March 31, 2009 was $0.40 per share, compared with $0.43 per share for 2008. Return on average assets and return on average equity were 0.99% and 12.14%, respectively, for the three months ended March 31, 2009, compared with 1.07% and 13.68%, respectively, for 2008.

NBT President and CEO Martin Dietrich said: "Our first quarter results were down slightly from the same period in 2008 primarily due to higher FDIC premiums which were imposed on all FDIC insured financial institutions. I am pleased with our performance as we were able to grow our net interest income over last year by more than 9% due to effective management of our earning assets and liabilities in this challenging economic environment. Compared with the first quarter of 2008, our noninterest income grew by more than 21%, which is important to our success. While these positive trends have been encouraging, we were negatively affected in a few areas, due in part to the recent struggles of the financial services industry and the economy in general. Most notably, our FDIC premiums increased by approximately $1.3 million in the first quarter of 2009, as compared with the first quarter of 2008, due to increased assessment rates. In addition, our pension expenses increased significantly in the first quarter due to the volatile marketplace and its impact on plan assets. On a positive note, in the beginning of the second quarter we were able to raise approximately $34 million in capital through an additional public offering of our common stock on favorable terms, while simultaneously being added to the Standard & Poor's SmallCap 600 Index. Inclusion in this index is a very significant event for our Company, since it reinforces and recognizes our strong financial performance. While we anticipate that the rest of 2009 will be very challenging for the financial services industry, we are confident that we can continue to meet these challenges and deliver long-term value to our shareholders and customers."

Loan and Lease Quality and Provision for Loan and Lease Losses

Nonperforming loans at March 31, 2009 were $27.3 million or 0.75% of total loans and leases compared with $26.5 million or 0.73% at December 31, 2008. The allowance for loan and lease losses totaled $59.3 million at March 31, 2009, compared with $58.6 million at December 31, 2008. The Company recorded a provision for loan and lease losses of $6.5 million during the first quarter of 2009 compared with $6.5 million for the three months ending March 31, 2008. Net charge-offs totaled $5.7 million for the three-month period ended March 31, 2009, up from $4.2 million for the three months ended March 31, 2008. The increase in net charge-offs for the three months ended March 31, 2009, compared with the three months ended March 31, 2008, was due primarily to increased charge-offs in the first quarter of 2009 related to indirect consumer loans and small business loans. The Company's allowance for loan and lease losses was 1.63% of loans and leases at March 31, 2009, compared with 1.61% at March 31, 2008.

Net Interest Income

Net interest income was up 9.2% to $48.1 million for the three months ended March 31, 2009, compared with $44.1 million for the three months ended March 31, 2008. The Company's fully taxable equivalent (FTE) net interest margin was 4.09% for the three months ended March 31, 2009, as compared with 3.84% for the three months ended March 31, 2008. In addition, the Company experienced a 3.0% growth in average earning assets for the three months ended March 31, 2009, compared with the three months ended March 31, 2008, due primarily to an increase in average loans and leases.

Although the yield on interest-earning assets decreased 57 basis points for the three months ended March 31, 2009, the yield on interest-bearing liabilities declined 98 basis points, which led to the increase in the net interest margin from the three months ended March 31, 2008. The yield on money market deposit accounts was 1.34% for the three months ended March 31, 2009, down from 2.37% for the three months ended March 31, 2008. The yield on time deposits decreased 124 basis points for the same period. The yield on short-term borrowings declined 270 basis points for the three months ended March 31, 2009, compared with the three months ended March 31, 2008, as a result of the 200 basis point drop in the Federal Reserve's target for the federal funds rate from 2.25% at March 31, 2008 to 0.25% at March 31, 2009.

Noninterest Income

Noninterest income for the three months ended March 31, 2009 was $19.6 million, up $3.5 million or 21.7% from $16.1 million for the same period in 2008. The increase in noninterest income was due primarily to an increase in broker/dealer and insurance revenue of approximately $4.2 million for the three months ended March 31, 2009, primarily due to the acquisition of Mang Insurance Agency, LLC during the third quarter of 2008. This increase was partially offset by a decrease in trust administration income of $0.4 million for the three months ended March 31, 2009, compared with the same period in 2008. This decrease was primarily the result of a decline in the value of trust assets under administration.

Noninterest Expense and Income Tax Expense

Noninterest expense for the three months ended March 31, 2009 was $42.3 million, up from $34.0 million for the same period in 2008. Salaries and employee benefits increased $4.7 million, or 27.8%, for the three months ended March 31, 2009, compared with the same period in 2008. This increase was due primarily to increases in full-time-equivalent employees during 2009, largely due to new branch activity and the aforementioned acquisition. In addition, the Company experienced increases of approximately $0.8 million and $0.4 million in pension and medical expenses, respectively, for the three months ended March 31, 2009 as compared with the same period in 2008. Occupancy, equipment and data processing and communications expenses were $9.5 million for the three months ended March 31, 2009, up $0.9 million, or 10.2%, from $8.6 million for the three months ended March 31, 2008. This increase was due primarily to an increase in expenses related to new branch activity during the past nine months. Professional fees and outside services decreased $0.4 million for the three months ended March 31, 2009, compared with the same period in 2008, due primarily to professional fees incurred in 2008 related to noninterest income initiatives. Amortization of intangible assets was $0.8 million for the three months ended March 31, 2009, up from $0.4 million for same period in 2008 due to the aforementioned acquisition. Other operating expenses were $4.1 million for the three months ended March 31, 2009, up $1.0 million from $3.1 million for the three months ended March 31, 2008. This increase resulted primarily from various nonrecurring recoveries in 2008. FDIC expenses increased approximately $1.3 million for the three months ended March 31, 2009, compared with the same period in 2008. Income tax expense for the three months ended March 31, 2009 and 2008 was $5.9 million. The effective rates were 31.0% and 30.2% for the three months ended March 31, 2009 and 2008, respectively.

Balance Sheet

Total assets were $5.4 billion at March 31, 2009, up $70.1 million or 1.3% from $5.3 billion at December 31, 2008. Loans and leases were $3.6 billion at March 31, 2009, down nominally from December 31, 2008. Total deposits were $4.1 billion at March 31, 2009, up $152.7 million or 3.9% from December 31, 2008. The increase from December 31, 2008 was due in large part to a $177.7 million, or 9.4%, increase in NOW, savings and money market accounts, partially offset by a $27.6 million decrease in time deposits. Stockholders' equity was $442.6 million, representing a total equity-to-total assets ratio of 8.19% at March 31, 2009, compared with $431.8 million or a total equity-to-total assets ratio of 8.09% at December 31, 2008.

Stock Repurchase Program

The Company made no purchases of its common stock securities during the quarter ended March 31, 2009. At March 31, 2009, there were 1,000,000 shares available for repurchase under a previously announced stock repurchase plan. This plan was authorized on January 28, 2008 in the amount of 1,000,000 shares and expires on December 31, 2009.

Dividend Declared

The NBT Board of Directors declared a 2009 second-quarter cash dividend of $0.20 per share at a meeting held today. The dividend will be paid on June 15, 2009, to shareholders of record as of June 1, 2009.

Corporate Overview

NBT Bancorp Inc. is a financial holding company headquartered in Norwich, NY, with total assets of $5.4 billion at March 31, 2009. The company primarily operates through NBT Bank, N.A., a full-service community bank with two divisions, and through two financial services companies. NBT Bank, N.A. has 122 locations, including 84 NBT Bank offices in upstate New York and 38 Pennstar Bank offices in northeastern Pennsylvania. EPIC Advisors, Inc., based in Rochester, NY, is a full-service 401(k) plan recordkeeping firm. Mang Insurance Agency, LLC, based in Binghamton, NY, is a full-service insurance agency. More information about NBT and its divisions can be found on the Internet at: www.nbtbancorp.com, www.nbtbank.com, www.pennstarbank.com, www.epic1st.com and www.manginsurance.com.

Forward-Looking Statements

This news release contains forward-looking statements. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of the management of NBT Bancorp and its subsidiaries and on the information available to management at the time that these statements were made. There are a number of factors, many of which are beyond NBT's control, that could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following possibilities: (1) competitive pressures among depository and other financial institutions may increase significantly; (2) revenues may be lower than expected; (3) changes in the interest rate environment may reduce interest margins; (4) general economic conditions, either nationally or regionally, may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and/or a reduced demand for credit; (5) legislative or regulatory changes, including changes in accounting standards and tax laws, may adversely affect the businesses in which NBT is engaged; (6) competitors may have greater financial resources and develop products that enable such competitors to compete more successfully than NBT; and (7) adverse changes may occur in the securities markets or with respect to inflation. Forward-looking statements speak only as of the date they are made. Except as required by law, NBT does not undertake to update forward-looking statements to reflect subsequent circumstances or events.

                    NBT Bancorp Inc. and Subsidiaries
                      SELECTED FINANCIAL HIGHLIGHTS
                                (unaudited)

                                                    Net         Percent
                        2009          2008         Change        Change
                    ------------  ------------  ------------  ------------
                        (dollars in thousands,
                        except per share data)

Three Months Ended
 March 31,
Net Income          $     13,072  $     13,716  ($       644)           -5%
Diluted Earnings
 Per Share          $       0.40  $       0.43  ($      0.03)           -7%
Weighted Average
 Diluted
  Common Shares
   Outstanding        32,644,599    32,251,700       392,899             1%
Return on Average
 Assets (1)                 0.99%         1.07%        -0.08%           -7%
Return on Average
 Equity (1)                12.14%        13.68%        -1.54%          -11%
Net Interest Margin
 (2)                        4.09%         3.84%         0.25%            7%
                    ------------  ------------  ------------  ------------

Asset Quality          March 31,  December 31,
                        2009          2008
                    ------------  ------------
Nonaccrual Loans    $     24,747  $     24,191
90 Days Past Due
 and Still Accruing $      2,537  $      2,305
Total Nonperforming
 Loans              $     27,284  $     26,496
Other Real Estate
 Owned              $      1,254  $        665
Total Nonperforming
 Assets             $     28,538  $     27,161
Past Due Loans      $     33,982  $     33,098
Allowance for Loan
 and Lease Losses   $     59,311  $     58,564
Year-to-Date (YTD)
 Net Charge-Offs    $      5,704  $     22,800
Allowance for Loan
 and Lease Losses
 to Total Loans and
 Leases                     1.63%         1.60%
Total Nonperforming
 Loans to Total
 Loans and Leases           0.75%         0.73%
Total Nonperforming
 Assets to Total
 Assets                     0.53%         0.51%
Past Due Loans to
 Total Loans and
 Leases                     0.93%         0.91%
Allowance for Loan
 and Lease Losses
 to Total
 Nonperforming
 Loans                    217.38%       221.03%
Net Charge-Offs to
 YTD Average Loans
 and Leases                 0.63%         0.64%
                    ------------  ------------

Capital
Equity to Assets            8.19%         8.09%
Book Value Per
 Share              $      13.55  $      13.24
Tangible Book Value
 Per Share          $       9.34  $       9.01
Tier 1 Leverage
 Ratio                      7.47%         7.17%
Tier 1 Capital
 Ratio                     10.11%         9.75%
Total Risk-Based
 Capital Ratio             11.36%        11.00%
                    ------------  ------------

Quarterly Common
 Stock Price             2009          2008          2007
Quarter End          High   Low    High   Low    High   Low
                     ----   ---    ----   ---    ----   ---
March 31            $28.37 $15.42 $23.65 $17.95 $25.81 $21.73
June 30                            25.00  20.33  23.45  21.80
September 30                       36.47  19.05  23.80  17.10
December 31                        30.83  21.71  25.00  20.58

(1)  Annualized
(2)  Calculated on a FTE basis




                    NBT Bancorp Inc. and Subsidiaries
                      SELECTED FINANCIAL HIGHLIGHTS
                                (unaudited)



                            March 31, December 31,     Net       Percent
                               2009        2008       Change      Change
                            ----------- ----------- ----------  ----------
                            (dollars in thousands,
                            except per share data)
Balance Sheet
Loans and Leases            $ 3,648,384 $ 3,651,911 ($   3,527)          0%
Earning Assets              $ 4,992,706 $ 4,933,099 $   59,607           1%
Total Assets                $ 5,406,234 $ 5,336,088 $   70,146           1%
Deposits                    $ 4,075,919 $ 3,923,258 $  152,661           4%
Stockholders’ Equity        $   442,598 $   431,845 $   10,753           2%
                            ----------- ----------- ----------  ----------

                               2009        2008
                            ----------- -----------
Average Balances            (dollars in thousands,
                            except per share data)
Three Months Ended March
 31,
Loans and Leases            $ 3,658,682 $ 3,466,360 $  192,322           6%
Securities Available For
 Sale
(excluding unrealized gains
 or losses)                 $ 1,089,512 $ 1,120,257 ($  30,745)         -3%
Securities Held To Maturity $   138,700 $   152,860 ($  14,160)         -9%
Regulatory Equity
 Investment                 $    38,852 $    37,509 $    1,343           4%
Short-Term Interest Bearing
 Accounts                   $     2,684 $     8,400 ($   5,716)        -68%
Total Earning Assets        $ 4,928,430 $ 4,785,386 $  143,044           3%
Total Assets                $ 5,351,476 $ 5,164,344 $  187,132           4%
Interest Bearing Deposits   $ 3,312,594 $ 3,232,999 $   79,595           2%
Non-Interest Bearing
 Deposits                   $   680,835 $   659,417 $   21,418           3%
Short-Term Borrowings       $   148,448 $   303,576 ($ 155,128)        -51%
Long-Term Borrowings        $   706,660 $   500,294 $  206,366          41%
Total Interest Bearing
 Liabilities                $ 4,167,702 $ 4,036,869 $  130,833           3%
Stockholders’ Equity        $   436,685 $   403,165 $   33,520           8%
                            ----------- ----------- ----------  ----------





NBT Bancorp Inc. and Subsidiaries                   March 31, December 31,
Consolidated Balance Sheets (unaudited)                2009        2008
                                                    ----------- -----------
(in thousands)

ASSETS
Cash and due from banks                             $    98,753 $   107,409
Short term interest bearing accounts                     80,580       2,987
Securities available for sale, at fair value          1,111,372   1,119,665
Securities held to maturity (fair value of $140,423
 and $141,308 at March 31, 2009 and December 31,
 2008, respectively)                                    139,195     140,209
Trading securities                                        1,741       1,407
Federal Reserve and Federal Home Loan Bank stock         37,920      39,045
Loans and leases                                      3,648,384   3,651,911
Less allowance for loan and lease losses                 59,311      58,564
                                                    =========== ===========
  Net loans and leases                                3,589,073   3,593,347
Premises and equipment, net                              64,951      65,241
Goodwill                                                114,838     114,838
Intangible assets, net                                   22,784      23,367
Bank owned life insurance                                72,111      72,276
Other assets                                             72,916      56,297
                                                    ----------- -----------
TOTAL ASSETS                                        $ 5,406,234 $ 5,336,088
                                                    =========== ===========

LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
  Demand (noninterest bearing)                      $   688,116 $   685,495
  Savings, NOW, and money market                      2,063,222   1,885,551
  Time                                                1,324,581   1,352,212
                                                    ----------- -----------
    Total deposits                                    4,075,919   3,923,258
Short-term borrowings                                   127,187     206,492
Long-term debt                                          616,078     632,209
Trust preferred debentures                               75,422      75,422
Other liabilities                                        69,030      66,862
                                                    ----------- -----------
    Total liabilities                                 4,963,636   4,904,243


Total stockholders' equity                              442,598     431,845
                                                    =========== ===========

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY          $ 5,406,234 $ 5,336,088
                                                    =========== ===========



                                                            Three months
                                                                ended
NBT Bancorp Inc. and Subsidiaries                             March 31,
Consolidated Statements of Income (unaudited)               2009     2008
                                                          -------- --------
(in thousands, except per share data)
Interest, fee and dividend income:
Loans and leases                                          $ 55,411 $ 58,617
Securities available for sale                               12,375   13,746
Securities held to maturity                                  1,234    1,514
Other                                                          361      775
                                                          -------- --------
  Total interest, fee and dividend income                   69,381   74,652
                                                          -------- --------
Interest expense:
Deposits                                                    13,839   22,698
Short-term borrowings                                          147    2,340
Long-term debt                                               6,197    4,302
Trust preferred debentures                                   1,086    1,247
                                                          -------- --------
  Total interest expense                                    21,269   30,587
                                                          -------- --------
Net interest income                                         48,112   44,065
Provision for loan and lease losses                          6,451    6,478
                                                          -------- --------
Net interest income after provision for loan and lease
 losses                                                     41,661   37,587
                                                          -------- --------
Noninterest income:
Trust                                                        1,409    1,774
Service charges on deposit accounts                          6,297    6,525
ATM and debit card fees                                      2,182    2,097
Broker/dealer and insurance revenue                          5,338    1,107
Net securities gains                                             -       15
Bank owned life insurance income                               872      807
Retirement plan administration fees                          1,741    1,708
Other                                                        1,751    2,062
                                                          -------- --------
  Total noninterest income                                  19,590   16,095
                                                          -------- --------
Noninterest expense:
Salaries and employee benefits                              21,427   16,770
Office supplies and postage                                  1,530    1,339
Occupancy                                                    4,165    3,610
Equipment                                                    2,022    1,825
Professional fees and outside services                       2,722    3,099
Data processing and communications                           3,295    3,170
Amortization of intangible assets                              813      391
Loan collection and other real estate owned                    748      567
FDIC expenses                                                1,529      188
Other operating                                              4,054    3,075
                                                          -------- --------
  Total noninterest expense                                 42,305   34,034
                                                          -------- --------
Income before income taxes                                  18,946   19,648
Income taxes                                                 5,874    5,932
                                                          -------- --------
   Net income                                             $ 13,072 $ 13,716
                                                          -------- --------
Earnings Per Share:
     Basic                                                $   0.40 $   0.43
     Diluted                                              $   0.40 $   0.43
                                                          ======== ========




NBT Bancorp Inc. and
 Subsidiaries
Quarterly Consolidated
 Statements of Income        1Q        4Q        3Q        2Q        1Q
 (unaudited)                2009      2008      2008      2008      2008
                          --------- --------  --------- --------- ---------
(in thousands, except per
 share data)
Interest, fee and
 dividend income:
Loans and leases          $  55,411 $ 58,164  $  58,154 $  57,220 $  58,617
Securities available for
 sale                        12,375   13,434     13,451    13,417    13,746
Securities held to
 maturity                     1,234    1,253      1,343     1,478     1,514
Other                           361      436        673       739       775
                          --------- --------  --------- --------- ---------
  Total interest, fee and
   dividend income           69,381   73,287     73,621    72,854    74,652
                          --------- --------  --------- --------- ---------
Interest expense:
Deposits                     13,839   16,371     18,351    18,712    22,698
Short-term borrowings           147      382        763     1,362     2,340
Long-term debt                6,197    6,401      6,310     5,629     4,302
Trust preferred
 debentures                   1,086    1,200      1,154     1,146     1,247
                          --------- --------  --------- --------- ---------
  Total interest expense     21,269   24,354     26,578    26,849    30,587
                          --------- --------  --------- --------- ---------
Net interest income          48,112   48,933     47,043    46,005    44,065
Provision for loan and
 lease losses                 6,451    7,721      7,179     5,803     6,478
                          --------- --------  --------- --------- ---------
Net interest income after
 provision for loan and
 lease losses                41,661   41,212     39,864    40,202    37,587
                          --------- --------  --------- --------- ---------
Noninterest income:
Trust                         1,409    1,685      1,720     2,099     1,774
Service charges on
 deposit accounts             6,297    7,266      7,414     6,938     6,525
ATM and debit card fees       2,182    2,176      2,334     2,225     2,097
Broker/dealer and
 insurance fees               5,338    3,915      2,338     1,366     1,107
Net securities (losses)
 gains                            -       (8)     1,510        18        15
Bank owned life insurance
 income                         872    2,484        924       708       807
Retirement plan
 administration fees          1,741    1,468      1,461     1,671     1,708
Other                         1,751    1,244      1,261     1,394     2,062
                          --------- --------  --------- --------- ---------
  Total noninterest
   income                    19,590   20,230     18,962    16,419    16,095
                          --------- --------  --------- --------- ---------
Noninterest expense:
Salaries and employee
 benefits                    21,427   20,633     16,850    16,906    16,770
Office supplies and
 postage                      1,530    1,354      1,322     1,331     1,339
Occupancy                     4,165    3,385      3,359     3,427     3,610
Equipment                     2,022    1,944      1,908     1,862     1,825
Professional fees and
 outside services             2,722    2,651      2,205     2,521     3,099
Data processing and
 communications               3,295    3,254      3,155     3,115     3,170
Amortization of
 intangible assets              813      874        462       378       391
Loan collection and other
 real estate owned              748      692        505       730       567
Impairment on lease
 residual assets                  -        -      2,000         -         -
FDIC expenses                 1,529      827        614       184       188
Other operating               4,054    4,684      4,678     4,969     3,075
                          --------- --------  --------- --------- ---------
  Total noninterest
   expense                   42,305   40,298     37,058    35,423    34,034
                          --------- --------  --------- --------- ---------
Income before income
 taxes                       18,946   21,144     21,768    21,198    19,648
Income taxes                  5,874    6,247      6,685     6,541     5,932
                          --------- --------  --------- --------- ---------
   Net income             $  13,072 $ 14,897  $  15,083 $  14,657 $  13,716
                          ========= ========  ========= ========= =========
Earnings per share:
   Basic                  $    0.40 $   0.46  $    0.47 $    0.46 $    0.43
   Diluted                $    0.40 $   0.45  $    0.46 $    0.45 $    0.43
                          ========= ========  ========= ========= =========


Contact Information

  • Contact:
    Martin A. Dietrich
    CEO
    Michael J. Chewens
    CFO
    NBT Bancorp Inc.
    52 South Broad Street
    Norwich, NY 13815
    607-337-6119