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Community Bank System, Inc. Reports First Quarter 2023 Results

Community Bank System, Inc. (the “Company”) (NYSE: CBU) reported first quarter 2023 net income of $5.8 million, or $0.11 per fully-diluted share. This compares to $47.1 million of net income, or $0.86 per fully-diluted share for the first quarter of 2022. The $0.75 decrease in earnings per share was primarily due to the impact of the previously announced strategic balance sheet repositioning executed during the quarter to provide the Company with greater flexibility in managing balance sheet growth and deposit funding. During the quarter, the Company sold certain available-for-sale investments securities and used the proceeds to pay down overnight borrowings with rising and comparatively high variable interest rates. As a result, a $52.3 million pre-tax realized loss on the investment security sales was recognized during the quarter which negatively impacted GAAP earnings per share by $0.75. In addition, increases in the provision for credit losses and operating expenses were offset by increases in net interest income and noninterest revenues, lower income taxes and a decrease in fully-diluted shares outstanding. Comparatively, the Company recorded $0.97 in fully-diluted earnings per share for the linked fourth quarter of 2022. The Company’s deposit base and liquidity position continues to be strong, as the Company maintained total immediately available liquidity sources at the end of the quarter of $4.69 billion, over double its estimated uninsured deposits, net of collateralized deposits, which represent less than 20% of first quarter ending total deposits. Additionally, total ending deposits increased $98.4 million, or 0.8%, from December 31, 2022.

Operating earnings per share, a non-GAAP measure, which excludes acquisition expenses, acquisition-related contingent consideration adjustments, loss on sales of investment securities, unrealized loss (gain) on equity securities and gain on debt extinguishment, net of tax, was $0.86 for the first quarter of 2023, as compared to $0.87 for the first quarter of 2022 and $0.96 for the fourth quarter of 2022. The $0.01 decrease in operating earnings per share on a year over year basis was driven by a decrease in banking-related noninterest revenues, an increase in the provision for credit losses and higher operating expenses, partially offset by increases in net interest income and financial services business revenues, and decreases in income taxes and fully-diluted shares outstanding. The $0.10 decrease in operating earnings per share from the fourth quarter of 2022 was driven by various factors, including a decrease in net interest income, an increase in the provision for credit losses, lower deposit service and other banking fees and higher operating expenses, offset, in part, by an increase in financial services business revenues and lower income taxes.

First quarter 2023 adjusted pre-tax, pre-provision net revenue per share, a non-GAAP measure, which excludes income taxes, the provision for credit losses, acquisition expenses, acquisition-related contingent consideration adjustments, loss on sales of investment securities, gain on debt extinguishment and unrealized loss (gain) on equity securities from net income, of $1.16 was up $0.04 as compared to the first quarter of 2022 and down $0.13 as compared to the fourth quarter of 2022.

First Quarter 2023 Performance Highlights:

  • GAAP EPS
    • $0.11 per share, down from $0.86 per share for the first quarter of 2022
  • Operating EPS (non-GAAP)
    • $0.86 per share, down $0.01 per share from the first quarter of 2022
  • Adjusted Pre-Tax, Pre-Provision Net Revenue Per Share (non-GAAP)
    • $1.16 per share, up $0.04 per share from the first quarter of 2022
  • Return on Assets / Return on Assets – Operating (non-GAAP)
    • 0.15% / 1.24%
  • Return on Equity / Return on Equity – Operating (non-GAAP)
    • 1.49% / 12.04%
  • Total Deposits
    • Up $98.4 million, or 0.8%, from the end of the fourth quarter of 2022
  • Total Deposit Funding Costs / Total Cost of Funds
    • 0.31% / 0.44%
  • Net Interest Margin (Fully Tax-Equivalent)
    • 3.20%, up 18 basis points from 3.02% for the fourth quarter of 2022
  • Total Loans
    • Up $172.9 million, or 2.0%, from the end of the fourth quarter of 2022
  • Annualized Loan Net Charge-Offs
    • 0.07%

“We are pleased with the core revenue performance of both our banking and nonbanking businesses despite the Company’s first quarter operating expenses being a bit elevated due to higher compensation and benefit related expenses and other factors,” commented Mark E. Tryniski, President and CEO. “Excluding net realized and unrealized securities gains and losses and gain on debt extinguishment, the Company generated $176.6 million in total operating revenues in the first quarter. This represents a $16.1 million, or 10.0%, increase over the prior year’s first quarter and a $0.7 million, or 0.4%, increase over linked fourth quarter results. The Company’s net interest margin for the quarter of 3.20%, was 47 basis points higher than the prior year’s first quarter of 2.73% and up 18 basis points over the linked fourth quarter’s net interest margin of 3.02%. In addition, the Company’s ending loans increased for the seventh consecutive quarter, and despite the turmoil in the banking industry, ending deposit balances were up in the quarter. The Company recorded GAAP earnings per share of $0.11, as compared to $0.86 in the prior year’s first quarter. During the first quarter, the Company repositioned its balance sheet by selling certain available-for-sale investment securities with a market value of $733.8 million, the proceeds of which were used to pay down overnight borrowings with rising and comparatively high variable interest rates. In connection with this transaction, the Company recorded a $52.3 million pre-tax realized loss on the sale, negatively impacting the quarterly GAAP earnings per share by $0.75. Excluding the realized loss on the sale of the available-for-sale securities, acquisition expenses and gain on debt extinguishment, the Company recorded $0.86 per share on a non-GAAP operating basis, $0.01 per share less than the prior year’s first quarter operating earnings per share of $0.87.”

Mr. Tryniski further noted, “Despite solid operating revenues in the quarter, the Company’s operating earnings per share decreased a penny compared to the prior year’s first quarter largely due to an increase in the provision for credit losses and higher operating expenses. Although asset quality remains strong, the Company recorded $3.5 million in the provision for credit losses during the first quarter of 2023, a $2.6 million increase over the prior year’s first quarter primarily due to an adverse change in the economic outlook. Operating expenses increased $14.2 million, or 14.3%, over the prior year’s first quarter driven by higher salaries and employee benefits expense and an increase in other expenses that included the impact of the Elmira Savings Bank (“Elmira”) acquisition from the second quarter of 2022. For the remaining three quarters of 2023, management anticipates that total operating expenses, excluding any future acquisition activities, will remain generally in line with first quarter levels. Deposit service and other banking fees decreased $0.7 million, or 4.4%, as compared to the first quarter of 2022, as the Company implemented certain deposit fee changes, including the elimination of nonsufficient and unavailable funds fees, late in the fourth quarter of 2022. Total revenues for the financial services businesses increased $0.5 million, or 1.1%, over the first quarter of 2022, driven by an increase in insurance services revenues.”

“At the end of the first quarter, the Company maintained total liquidity sources of $4.69 billion, including $1.54 billion of borrowing capacity at the Federal Reserve Bank, $1.84 billion of borrowing availability at the Federal Home Loan Bank, $1.21 billion of unencumbered high grade investment securities and $109.7 million of cash and cash equivalents, net of float. These sources of immediately available liquidity represent over 200% of the Company’s estimated uninsured deposits, net of collateralized deposits. The Company’s deposit base is well diversified across customer segments, comprised of approximately 63% consumer, 25% business and 12% municipal, and broadly dispersed with an average deposit account balance of under $20,000. The cycle-to-date deposit beta for the Company is 5%, reflective of a high proportion of non-interest bearing deposits, representing over 30% of total deposits, and the composition and stability of the customer base. In addition, 74% of the Company’s total deposits were in checking and savings accounts at the end of the first quarter. The Company does not currently utilize brokered or wholesale deposits and total deposits were up approximately 1% from the end of the prior quarter. We believe the Company’s strong liquidity profile, capital reserves, core deposit base, asset quality and revenue profile provide a solid foundation for future opportunities and growth,” Mr. Tryniski concluded.

The Company recorded total revenues of $124.5 million in the first quarter of 2023, a decrease of $36.0 million, or 22.4%, from the prior year’s first quarter. The decrease in total revenues between the periods was primarily driven by the previously mentioned $52.3 million pre-tax realized loss on the sale of certain available-for-sale investment securities associated with the Company’s first quarter 2023 balance sheet repositioning. Total operating revenues, which excludes net realized and unrealized securities gains and losses and gain on debt extinguishment, were $176.6 million in the first quarter of 2023, an increase of $16.1 million, or 10.0%, from the prior year’s first quarter. This increase was driven by a $16.2 million, or 17.0%, increase in net interest income and a $0.5 million, or 1.1%, increase in financial services business revenues, offset, in part, by a $0.6 million, or 3.6%, decrease in banking noninterest revenues. Comparatively, total revenues were down $51.4 million, or 29.2%, from fourth quarter 2022 results, but up $0.7 million, or 0.4%, on an operating basis, excluding net realized and unrealized securities gains and losses and gain on debt extinguishment. The linked quarter increase in total operating revenues was due to a $4.5 million, or 10.0%, increase in financial services business revenues, partially offset by a $1.2 million, or 1.1%, decline in net interest income and a $2.6 million, or 13.6%, decrease in banking noninterest revenues.

The Company recorded net interest income of $111.0 million in the first quarter of 2023. This compares to $94.9 million of net interest income recorded in the first quarter of 2022. Between comparable periods, the combination of net interest margin expansion being partially offset by a decline in interest-earning assets drove a $16.2 million, or 17.0%, increase in net interest income. The Company’s tax equivalent net interest margin increased by 47 basis points from 2.73% in the first quarter of 2022 to 3.20% in the first quarter of 2023, while average interest-earning assets decreased $31.8 million, or 0.2%. The tax equivalent yield on average interest-earning assets in the first quarter of 2023 of 3.63% was 82 basis points higher than the tax equivalent yield on average interest-earning assets of 2.81% in the first quarter of 2022. Comparatively, the Company recorded net interest income of $112.2 million during the fourth quarter of 2022, which was $1.2 million more than first quarter 2023 results, while the tax equivalent net interest margin was 3.02%, or 18 basis points lower.

Interest income and fees on loans increased $27.9 million, or 38.4%, from $72.5 million in the first quarter of 2022 to $100.4 million in the first quarter of 2023. Average total loans outstanding increased $1.49 billion, or 20.2%, between the comparable quarterly periods, while the tax equivalent loan yield increased 60 basis points from 3.99% in the first quarter of 2022 to 4.59% in the first quarter of 2023. The increase in the tax equivalent loan yields between the periods was due to market-related increases in interest rates on new loans, a significant increase in variable and adjustable rate loan yields driven by rising market interest rates, including the prime rate, and a high level of new loan originations. Comparatively, the Company recorded $96.2 million of interest income and fees on loans during the fourth quarter of 2022, while the tax equivalent yield on loans was 4.39%.

Interest income on investments, including cash equivalents, increased $0.3 million, or 1.3%, between the first quarter of 2022 and the first quarter of 2023. The increase in interest income on investments was driven primarily by changes in market interest rates and changes in the composition of investment securities and interest-earning cash equivalents, along with the impact of the previously mentioned balance sheet repositioning related to the sales of certain available-for-sale investment securities. The average book value of investment securities decreased $623.5 million, or 10.5%, between the comparable periods, while the average balance of cash equivalents decreased $903.1 million. The tax equivalent yield on the investment securities portfolio, excluding cash equivalents, increased 27 basis points from 1.74% in the first quarter of 2022 to 2.01% in the first quarter of 2023, while the yield on cash equivalents increased 330 basis points from 0.19% to 3.49%. The blended tax equivalent yield on investments, including cash equivalents, increased 49 basis points, from 1.53% to 2.02%, as the average balance of cash equivalents decreased significantly due in part to the funding of strong organic loan growth. Interest income on investments, including cash equivalents, decreased $2.3 million, from $27.8 million in the fourth quarter of 2022 to $25.5 million in the first quarter of 2023 due primarily to the impact of a lower average book value of investment securities due to the aforementioned sale of certain available-for-sale investment securities associated with the Company’s first quarter balance sheet repositioning.

Interest expense increased from $2.8 million in the first quarter of 2022 to $14.9 million in the first quarter of 2023, a $12.1 million increase between the periods. The increase in interest expense was driven by a 50 basis point increase in the cost of interest-bearing liabilities, from 0.12% in the first quarter of 2022 to 0.62% in the first quarter of 2023, and a $223.5 million, or 2.4%, increase in average interest-bearing liabilities between the periods. This included a $4.7 million increase in interest expense on borrowings due to both a $399.6 million increase in average borrowings and an increase in the rate on average borrowings, from 0.33% in the first quarter of 2022 to 2.78% in the first quarter of 2023. The average interest-bearing deposit cost of funds also increased 34 basis points, from 0.11% in the first quarter of 2022 to 0.45% in the first quarter of 2023, while average interest-bearing deposit balances decreased $176.1 million, or 1.9%, between the periods, with the net result being a $7.4 million increase in interest expense on deposits. The Company’s average cost of funds was up 35 basis points, from 0.09% in the first quarter of 2022 to 0.44% in the first quarter of 2023, while the average cost of total deposits remained low at 0.31% for the quarter. Through the end of the first quarter, the Company’s cycle-to-date deposit beta was 5% and the cycle-to-date total funding beta was 8%. The target Federal Funds rate has increased 450 basis points over the prior twelve months, while the Company’s total deposit costs and total funding costs increased 23 basis points and 35 basis points, respectively, over the same period.

During the first quarter of 2023, the Company recorded a provision for credit losses of $3.5 million driven by a weaker economic forecast combined with a $172.9 million increase in loans outstanding. Comparatively, the Company recorded a provision for credit losses of $0.9 million during the first quarter of 2022 when economic forecasts were generally stable and loans outstanding increased $48.6 million during that quarter. During the fourth quarter of 2022, the Company recorded a provision for credit losses of $2.8 million, due in part to a $265.8 million increase in loans outstanding, combined with a less favorable economic forecast during that quarter.

Employee benefit services revenues for the first quarter of 2023 were $29.4 million, down $0.2 million, or 0.7%, in comparison to the first quarter of 2022. The decline in revenues was driven primarily by a decline in asset-based fees reflecting the impact from lower financial market valuations. Wealth management services revenues for the first quarter of 2023 were $8.2 million, down from $8.6 million in the first quarter of 2022. The $0.4 million, or 4.5%, decrease in wealth management services revenues was primarily driven by more challenging investment market conditions. The Company recorded insurance services revenues of $11.5 million in the first quarter of 2023, which represents a $1.1 million, or 10.7%, increase versus the prior year’s first quarter, reflective primarily of a strong premium market and organic growth. Banking noninterest revenues decreased $0.6 million, or 3.6%, from $17.0 million in the first quarter of 2022 to $16.4 million in the first quarter of 2023. This was driven by a $0.7 million, or 4.4%, decrease in deposit service and other banking fees reflective of the Company’s implementation of certain deposit fee changes, including the elimination of nonsufficient and unavailable funds fees, late in the fourth quarter of 2022. Comparatively, the Company recorded $29.0 million of employee benefit services revenues, $7.4 million of wealth management services revenues and $8.3 million of insurance services revenues during the fourth quarter of 2022, which on a combined basis were $4.4 million lower than the financial services business revenues generated in the first quarter of 2023. Fourth quarter 2022 banking noninterest revenues were $19.0 million, $2.6 million, or 15.8%, higher than first quarter 2023 banking noninterest revenues, driven by a decrease in debit interchange revenues, overdraft occurrences, as well as the aforementioned implementation of certain deposit fee changes.

The Company recorded $114.0 million in total operating expenses in the first quarter of 2023, compared to $99.8 million of total operating expenses in the prior year’s first quarter. The $14.2 million, or 14.3%, increase in operating expenses was attributable to a $9.8 million, or 16.0%, increase in salaries and employee benefits, a $4.2 million, or 39.7%, increase in other expenses, a $0.5 million, or 3.7%, increase in data processing and communications expenses and a $0.1 million, or 0.7%, increase in occupancy and equipment expenses, partially offset by a $0.3 million decrease in acquisition-related expenses and a $0.1 million, or 1.7%, decrease in amortization of intangible assets. The increase in salaries and benefits expense was driven by increases in merit, severance and incentive-related employee wages, acquisition-related and other additions to staffing, higher payroll taxes and higher employee benefit-related expenses. Other expenses were up due to increases in legal and professional fees, insurance and travel-related expenses, business development and marketing expenses, along with incremental expenses associated with operating an expanded franchise subsequent to the Elmira acquisition in the second quarter of 2022. The higher insurance expenses reflected larger FDIC insurance expenses due in part to a higher base assessment rate effective at the beginning of 2023. The increase in data processing and communications expenses was due to the Company’s continued investment in customer-facing and back office digital technologies between the comparable periods. The slight increase in occupancy and equipment expense was driven by inflationary pressures, partially offset by the impact of branch office consolidations between the periods. In comparison, the Company recorded $105.9 million of total operating expenses in the fourth quarter of 2022. The $8.2 million, or 7.7%, increase in total operating expenses between the fourth quarter of 2022 and the first quarter of 2023 was largely attributable to a $7.4 million, or 11.5%, increase in salaries and employee benefits and a $0.7 million, or 5.0%, increase in other expenses reflective of higher FDIC insurance expenses due in part to a higher base assessment rate.

The effective tax rate for the first quarter of 2023 was 16.9%, down from 21.4% in the first quarter of 2022. Excluding the impact of tax benefits related to stock-based compensation activity, the effective tax rate was 21.4% in the first quarter of 2023, down from 22.3% in the first quarter of 2022.

The Company also provides supplemental reporting of its results on an “operating,” “adjusted” and “tangible” basis, from which it excludes the after-tax effect of amortization of core deposit and other intangible assets (and the related goodwill, core deposit intangible and other intangible asset balances, net of applicable deferred tax amounts), accretion on non-purchased credit deteriorated (“PCD”) loans, expenses associated with acquisitions, acquisition-related provision for credit losses, acquisition-related contingent consideration adjustments, gain on debt extinguishment, loss on sales of investment securities and unrealized (loss) gain on equity securities. In addition, the Company provides supplemental reporting for “adjusted pre-tax, pre-provision net revenues,” which subtracts the provision for credit losses, acquisition expenses, acquisition-related contingent consideration adjustments, gain on debt extinguishment, loss on sales of investment securities and unrealized (loss) gain on equity securities from income before income taxes. The amounts for such items are presented in the tables that accompany this release. Although these items are non-GAAP measures, the Company’s management believes this information helps investors and analysts measure underlying core performance and improves comparability to other organizations that have not engaged in acquisitions. Diluted adjusted net earnings per share, a non-GAAP measure, were $0.90 in the first quarter of 2023, compared to $0.91 in the first quarter of 2022 and $1.00 in the fourth quarter of 2022. Adjusted pre-tax, pre-provision net revenue per share, a non-GAAP measure, was $1.16 in the first quarter of 2023, compared to $1.12 in the first quarter of 2022 and $1.29 in the fourth quarter of 2022.

Financial Position and Liquidity

The Company’s total assets were $15.26 billion at March 31, 2023, representing a $369.9 million, or 2.4%, decrease from one year prior and a $579.7 million, or 3.7%, decrease from the end of the fourth quarter of 2022. The decrease in the Company’s total assets during the prior twelve-month period was primarily driven by the aforementioned sales of certain available-for-sale investment securities and the related pay down of overnight borrowings and a decline in the pre-tax market value adjustment on the investment securities portfolio due to higher market interest rates, partially offset by organic loan growth and the Elmira acquisition. The book value of average interest-earning assets was down from $14.24 billion in the first quarter of 2022 to $14.20 billion in the first quarter of 2023, representing a $31.8 million, or 0.2%, decrease. This included a $903.1 million decrease in average cash equivalents and a $623.5 million, or 10.5%, decrease in the average book value of investment securities, partially offset by a $1.49 billion, or 20.2%, increase in average loans outstanding. Average deposit balances decreased $100.8 million, or 0.8%, between the first quarter of 2022 and the first quarter of 2023.

On a linked quarter basis, the book value of average interest-earning assets decreased $662.1 million, or 4.5%, due primarily to a decrease in the average book value of investment securities, partially offset by higher average loan balances. The average book value of investment securities decreased $843.5 million, or 13.7%, during the quarter, driven primarily by the aforementioned sales of certain available-for-sale investment securities in connection with a balance sheet repositioning, while average cash equivalents increased $1.3 million, or 4.8%, between linked quarters. Average loan balances increased $180.1 million, or 2.1%, during the quarter reflecting continued strong organic growth. Average loan balances for business lending, consumer indirect and consumer mortgage loans increased during the first quarter, while the average balances of home equity and consumer direct loans decreased. Average deposit balances decreased $211.5 million, or 1.6%, compared to the fourth quarter of 2022.

Ending loans at March 31, 2023 of $8.98 billion were $172.9 million, or 2.0%, higher than the fourth quarter of 2022 and $1.56 billion, or 21.0%, higher than one year prior. The increase in ending loans year-over-year was driven by increases in all loan categories due to net organic growth and the Elmira acquisition. Over the past twelve months, business lending loans increased $645.4 million, or 20.8%, consumer indirect loans increased $429.3 million, or 36.5%, consumer mortgage loans increased $427.1 million, or 16.5%, home equity loans increased $33.7 million, or 8.5%, and consumer direct loans increased $24.5 million, or 16.1%. The increase in loans outstanding on a linked quarter basis was driven by a $102.3 million, or 2.8%, increase in business lending loans, a $66.0 million, or 4.3%, increase in consumer indirect loans and a $7.2 million, or 0.2%, increase in consumer mortgage loans, all of which reflected organic growth, partially offset by a $2.0 million, or 0.5%, decrease in home equity loans and a $0.6 million, or 0.3%, decrease in consumer direct loans.

The Company’s liquidity position remains strong. The Company’s banking subsidiary, Community Bank, N.A. (the “Bank”), maintains a funding base largely comprised of core noninterest-bearing demand deposit accounts and interest-bearing checking, savings and money market deposit accounts with customers that operate, reside or work within its branch footprint. At March 31, 2023, the Company’s readily available sources of liquidity totaled $4.69 billion, including cash and cash equivalents balances, net of float, of $109.7 million. The Company also maintains an investment securities portfolio, comprised primarily of highly-liquid U.S. Treasury securities, highly-rated municipal securities and U.S. agency mortgage-backed securities, which totaled $4.56 billion at March 31, 2023, $1.21 billion of which was unpledged as collateral. The Bank’s unused borrowing capacity at the Federal Home Loan Bank of New York at March 31, 2023 was $1.84 billion and it had access to $1.54 billion of funding availability at the Federal Reserve Bank’s discount window. The available sources of immediately available liquidity represent over 200% of the Company’s estimated uninsured deposits, net of collateralized deposits and are exclusive of any potential benefits from utilization of the Federal Reserve Bank’s Bank Term Funding Program announced on March 12, 2023.

The Company’s management believes that its financial position continues to be very solid. The Company’s capital planning and management activities, coupled with its historically strong earnings performance, diversified streams of revenue and prudent dividend practices, have allowed it to build and maintain strong capital reserves. Shareholders’ equity of $1.63 billion at March 31, 2023 was $218.1 million, or 11.8%, lower than one year ago despite strong earnings retention primarily because of a $239.7 million decline in accumulated other comprehensive income related to the Company’s investment securities portfolio due to higher market interest rates. Shareholders’ equity was up $82.3 million, or 5.3%, from the end of the fourth quarter of 2022, primarily driven by a $108.6 million increase in accumulated other comprehensive income related to the Company’s investment securities portfolio.

At March 31, 2023, all of the Company’s and the Bank’s regulatory capital ratios significantly exceeded well-capitalized standards. More specifically, the Company’s tier 1 leverage ratio, a common measure used to evaluate a financial institution’s capital strength, was 9.06% at March 31, 2023, which substantially exceeds the regulatory well-capitalized standard of 5.0%. The Company’s shareholders’ equity to assets ratio (GAAP) was 10.71% at March 31, 2023, down from 11.85% at March 31, 2022, but up from 9.80% at December 31, 2022. The Company’s net tangible equity to net tangible assets ratio (non-GAAP) was 5.41% at March 31, 2023, down from 6.98% a year earlier, but up from 4.64% at the end of the fourth quarter of 2022. The decrease in the net tangible equity to net tangible assets ratio (non-GAAP) from one year prior was primarily driven by a $254.6 million, or 24.6%, decrease in tangible equity due to the aforementioned decline in accumulated other comprehensive income related to the Company’s investment securities portfolio and a $37.9 million net increase in intangible assets primarily driven by the Elmira acquisition, partially offset by a $406.4 million, or 2.7%, decrease in tangible assets due primarily to the aforementioned sales of certain available-for-sale investment securities. The increase in the net tangible equity to net tangible assets ratio (non-GAAP) from the fourth quarter of 2022 was driven by an $83.5 million, or 12.0%, increase in tangible equity and a $578.5 million, or 3.9%, decrease in tangible assets.

As previously announced, in December 2022 the Company’s Board of Directors (the “Board”) approved a stock repurchase program authorizing the repurchase of up to 2.70 million shares of the Company’s common stock during a twelve-month period starting January 1, 2023. Such repurchases may be made at the discretion of the Company’s senior management based on market conditions and other relevant factors and will be acquired through open market or privately negotiated transactions as permitted under Rule 10b-18 of the Securities Exchange Act of 1934 and other applicable regulatory and legal requirements. There were 200,000 shares repurchased pursuant to the 2023 stock repurchase program in the first quarter of 2023.

Allowance for Credit Losses and Asset Quality

At March 31, 2023, the Company’s allowance for credit losses totaled $63.2 million, or 0.70% of total loans outstanding. This compares to $61.1 million, or 0.69% of total loans outstanding, at the end of the fourth quarter of 2022 and $50.1 million, or 0.68% of total loans outstanding, at March 31, 2022. Reflective of a weaker economic forecast and an increase in loans outstanding, the Company recorded a $3.5 million provision for credit losses during the first quarter of 2023. The Company recorded net charge-offs of $1.5 million, or an annualized 0.07% of average loans, in the first quarter of 2023. This compares to net charge-offs of $0.5 million, or an annualized 0.03% of average loans, in the first quarter of 2022 and net charge-offs of $2.1 million, or an annualized 0.09% of average loans, in the fourth quarter of 2022.

At March 31, 2023, nonperforming (90 or more days past due and non-accruing) loans increased slightly to $33.8 million, or 0.38%, of total loans outstanding compared to $33.4 million, or 0.38%, of total loans outstanding at the end of the fourth quarter of 2022, but declined from $36.0 million, or 0.49%, of total loans outstanding one year earlier. Total delinquent loans, which includes nonperforming loans and loans 30 or more days delinquent, to total loans outstanding was 0.73% at the end of the first quarter of 2023. This compares to 0.84% at the end of the first quarter of 2022 and 0.89% at the end of the fourth quarter of 2022. Loans 30 to 89 days delinquent (categorized by the Company as delinquent but performing), which tend to exhibit seasonal characteristics, were 0.35% of total loans outstanding at March 31, 2023, down from 0.51% at the end of the fourth quarter of 2022 and consistent with 0.35% one year earlier.

Dividend Increase

During the first quarter of 2023, the Company declared a quarterly cash dividend of $0.44 per share on its common stock, up 2.3% from the $0.43 dividend declared in the first quarter of 2022, representing an annualized yield of 3.7% based upon the $47.20 closing price of the Company’s stock on April 24, 2023. The $0.01 increase in the quarterly dividend declared in the third quarter of 2022 marked the 30th consecutive year of dividend increases for the Company. “The payment of a meaningful and growing dividend is an important component of our commitment to provide consistent and favorable long term returns to our shareholders, and it reflects the continued strength of our current operating performance and capital position, and our confidence in the future of the Company,” said Mr. Tryniski.

Conference Call Scheduled

Company management will conduct an investor call at 11:00 a.m. (ET) today, April 25, 2023, to discuss the first quarter 2023 results. The conference call can be accessed at 1-833-630-0464 (1-412-317-1809 if outside the United States and Canada). Investors may also listen live via the Internet at: https://app.webinar.net/9N2aOaWwpYJ.

This earnings release, including supporting financial tables, is available within the press releases section of the Company's investor relations website at: https://ir.communitybanksystem.com. An archived webcast of the earnings call will be available on this site for one full year.

About Community Bank System, Inc.

Community Bank System, Inc. operates more than 210 customer facilities across Upstate New York, Northeastern Pennsylvania, Vermont, and Western Massachusetts through its banking subsidiary, Community Bank, N.A. With assets of over $15.2 billion, the DeWitt, N.Y. headquartered company is among the country’s 125 largest banking institutions. In addition to a full range of retail, business, and municipal banking services, the Company offers comprehensive financial planning, insurance and wealth management services through its Community Bank Wealth Management Group and OneGroup NY, Inc. operating units. The Company’s Benefit Plans Administrative Services, Inc. subsidiary is a leading provider of employee benefits administration, trust services, collective investment fund administration and actuarial consulting services to customers on a national scale. Community Bank System, Inc. is listed on the New York Stock Exchange and the Company’s stock trades under the symbol CBU. For more information about Community Bank visit www.cbna.com or https://ir.communitybanksystem.com.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on the current beliefs and expectations of CBU’s management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. The following factors, among others, could cause the actual results of CBU’s operations to differ materially from its expectations: the macroeconomic and other challenges and uncertainties related to or resulting from recent bank failures; current and future economic and market conditions, including the effects on housing prices, unemployment rates, high inflation, U.S. fiscal debt, budget and tax matters, geopolitical matters, and global economic growth; fiscal and monetary policies of the Federal Reserve Board; the potential adverse effects of unusual and infrequently occurring events; management’s estimates and projections of interest rates and interest rate policies; the effect of changes in the level of checking or savings account deposits and net interest margin; future provisions for credit losses on loans and debt securities; changes in nonperforming assets; the effect on stock market prices on CBU’s fee income businesses, including its employee benefit services, wealth management, and insurance businesses; the successful integration of operations of its acquisitions; competition; changes in legislation or regulatory requirements; and the timing for receiving regulatory approvals and completing pending transactions. For more information about factors that could cause actual results to differ materially from CBU’s expectations, refer to its reports filed with the Securities and Exchange Commission (“SEC”), including the discussion under “Risk Factors” as filed with the SEC and available on CBU’s website at https://ir.communitybanksystem.com and on the SEC’s website at www.sec.gov. Further, any forward-looking statement speaks only as of the date on which it is made, and CBU undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events.

 
Summary of Financial Data (unaudited)

 

 

 

 

 

(Dollars in thousands, except per share data)

 

 

 

 

 

 

2023

2022

 

1st Qtr

4th Qtr

3rd Qtr

2nd Qtr

1st Qtr

Earnings

 

 

 

 

 

Loan income

$100,362

$96,168

$88,434

$77,959

$72,514

Investment income

25,520

27,815

27,441

28,216

25,182

Total interest income

125,882

123,983

115,875

106,175

97,696

Interest expense

14,852

11,760

5,481

3,034

2,824

Net interest income

111,030

112,223

110,394

103,141

94,872

Acquisition-related provision for credit losses

0

0

0

3,927

0

Provision for credit losses

3,500

2,768

5,061

2,111

906

Net interest income after provision for credit losses

107,530

109,455

105,333

97,103

93,966

Deposit service and other banking fees

16,156

19,228

18,364

17,008

16,894

Mortgage banking

275

(205)

171

269

155

Wealth management and insurance services

19,767

15,680

18,834

17,921

19,042

Employee benefit services

29,384

29,023

27,884

28,921

29,580

Loss on sales of investment securities

(52,329)

0

0

0

0

Gain on debt extinguishment

242

0

0

0

0

Unrealized (loss) gain on equity securities

0

(20)

(4)

(22)

2

Total noninterest revenues

13,495

63,706

65,249

64,097

65,673

Salaries and employee benefits

71,487

64,103

66,190

65,398

61,648

Data processing and communications

13,129

13,645

14,184

13,611

12,659

Occupancy and equipment

11,024

10,673

10,364

10,424

10,952

Amortization of intangible assets

3,667

3,794

3,837

3,851

3,732

Acquisition-related contingent consideration adjustment

0

(700)

0

400

0

Acquisition expenses

57

353

409

3,960

299

Other

14,688

13,984

13,201

12,780

10,517

Total operating expenses

114,052

105,852

108,185

110,424

99,807

Income before income taxes

6,973

67,309

62,397

50,776

59,832

Income taxes

1,175

14,779

13,706

10,971

12,777

Net income

$5,798

$52,530

$48,691

$39,805

$47,055

Basic earnings per share

$0.11

$0.97

$0.90

$0.74

$0.87

Diluted earnings per share

$0.11

$0.97

$0.90

$0.73

$0.86

Profitability

 

 

 

 

 

Return on assets

0.15%

1.33%

1.24%

1.03%

1.22%

Return on equity

1.49%

14.12%

11.49%

9.16%

9.35%

Return on tangible equity(2)

3.26%

33.73%

23.76%

17.61%

15.63%

Noninterest revenues/operating revenues (FTE)(1)

37.1%

36.2%

37.2%

38.3%

40.9%

Efficiency ratio

62.5%

58.2%

59.3%

61.1%

59.6%

Components of Net Interest Margin (FTE)

 

 

 

 

 

Loan yield

4.59%

4.39%

4.22%

4.05%

3.99%

Cash equivalents yield

3.49%

2.83%

1.76%

0.65%

0.19%

Investment yield

2.01%

1.85%

1.80%

1.81%

1.74%

Earning asset yield

3.63%

3.34%

3.18%

2.97%

2.81%

Interest-bearing deposit rate

0.45%

0.26%

0.17%

0.12%

0.11%

Borrowing rate

2.78%

2.63%

1.34%

0.44%

0.33%

Cost of all interest-bearing funds

0.62%

0.47%

0.23%

0.13%

0.12%

Cost of funds (includes DDA)

0.44%

0.33%

0.16%

0.09%

0.09%

Net interest margin (FTE)

3.20%

3.02%

3.03%

2.89%

2.73%

Fully tax-equivalent adjustment

$1,091

$1,118

$1,118

$1,008

$830

Summary of Financial Data (unaudited)

 

 

 

 

 

(Dollars in thousands, except per share data)

 

 

 

 

 

 

2023

2022

 

1st Qtr

4th Qtr

3rd Qtr

2nd Qtr

1st Qtr

Average Balances

 

 

 

 

 

Loans

$8,884,164

$8,704,051

$8,333,148

$7,725,107

$7,389,290

Cash equivalents

27,775

26,501

25,730

472,671

930,882

Taxable investment securities

4,760,089

5,590,538

5,701,691

5,760,399

5,502,965

Nontaxable investment securities

532,604

545,679

551,610

513,506

413,268

Total interest-earning assets

14,204,632

14,866,769

14,612,179

14,471,683

14,236,405

Total assets

15,366,863

15,665,726

15,553,296

15,452,712

15,596,209

Interest-bearing deposits

8,925,555

8,982,442

9,142,333

9,268,859

9,101,664

Borrowings

717,788

879,194

481,657

310,674

318,193

Total interest-bearing liabilities

9,643,343

9,861,636

9,623,990

9,579,533

9,419,857

Noninterest-bearing deposits

4,043,494

4,198,086

4,192,615

4,061,738

3,968,197

Shareholders' equity

1,576,717

1,476,093

1,680,525

1,743,410

2,040,843

Balance Sheet Data

 

 

 

 

 

Cash and cash equivalents

$189,298

$209,896

$247,391

$197,628

$1,020,926

Investment securities

4,630,741

5,314,888

5,227,292

5,643,022

5,831,616

Loans:

 

 

 

 

 

Business lending

3,747,942

3,645,665

3,494,425

3,331,998

3,102,533

Consumer mortgage

3,019,718

3,012,475

2,975,521

2,903,822

2,592,586

Consumer indirect

1,605,659

1,539,653

1,461,235

1,309,753

1,176,373

Home equity

432,027

433,996

433,027

425,437

398,316

Consumer direct

176,989

177,605

179,399

173,686

152,445

Total loans

8,982,335

8,809,394

8,543,607

8,144,696

7,422,253

Allowance for credit losses

63,170

61,059

60,363

55,542

50,147

Goodwill and intangible assets, net

900,914

902,837

909,224

917,891

863,038

Other assets

615,835

659,695

727,396

640,138

538,197

Total assets

15,255,953

15,835,651

15,594,547

15,487,833

15,625,883

Deposits:

 

 

 

 

 

Noninterest-bearing

3,949,801

4,140,617

4,281,859

4,092,073

4,036,563

Non-maturity interest-bearing

8,106,734

7,964,983

8,296,993

8,268,649

8,388,800

Time

1,054,137

906,708

907,469

997,050

892,304

Total deposits

13,110,672

13,012,308

13,486,321

13,357,772

13,317,667

Borrowings

380,291

1,134,526

492,044

309,226

302,395

Subordinated notes payable

0

3,249

3,256

3,263

3,270

Accrued interest and other liabilities

130,977

133,863

151,763

155,876

150,448

Total liabilities

13,621,940

14,283,946

14,133,384

13,826,137

13,773,780

Shareholders' equity

1,634,013

1,551,705

1,461,163

1,661,696

1,852,103

Total liabilities and shareholders' equity

15,255,953

15,835,651

15,594,547

15,487,833

15,625,883

Capital and Other

 

 

 

 

 

Tier 1 leverage ratio

9.06%

8.79%

8.78%

8.65%

9.09%

Tangible equity/net tangible assets(2)

5.41%

4.64%

4.08%

5.40%

6.98%

Loan-to-deposit ratio

68.5%

67.7%

63.4%

61.0%

55.7%

Diluted weighted average common shares O/S

54,207

54,253

54,290

54,393

54,515

Period end common shares outstanding

53,725

53,737

53,736

53,734

53,913

Cash dividends declared per common share

$0.44

$0.44

$0.44

$0.43

$0.43

Book value

$30.41

$28.88

$27.19

$30.92

$34.35

Tangible book value(2)

$14.49

$12.93

$11.18

$14.69

$19.16

Common stock price (end of period)

$52.49

$62.95

$60.08

$63.28

$70.15

 

 

 

 

 

 

Summary of Financial Data (unaudited)

 

 

 

 

 

(Dollars in thousands, except per share data)

 

 

 

 

 

 

2023

2022

 

1st Qtr

4th Qtr

3rd Qtr

2nd Qtr

1st Qtr

Asset Quality

 

 

 

 

 

Nonaccrual loans

$29,745

$29,245

$28,076

$31,686

$32,213

Accruing loans 90+ days delinquent

4,027

4,119

4,416

5,439

3,816

Total nonperforming loans

33,772

33,364

32,492

37,125

36,029

Other real estate owned (OREO)

508

503

527

619

416

Total nonperforming assets

34,280

33,867

33,019

37,744

36,445

Net charge-offs

1,511

2,054

358

383

539

Allowance for credit losses/loans outstanding

0.70%

0.69%

0.71%

0.68%

0.68%

Nonperforming loans/loans outstanding

0.38%

0.38%

0.38%

0.46%

0.49%

Allowance for credit losses/nonperforming loans

187%

183%

186%

150%

139%

Net charge-offs/average loans

0.07%

0.09%

0.02%

0.02%

0.03%

Delinquent loans/ending loans

0.73%

0.89%

0.71%

0.75%

0.84%

Provision for credit losses/net charge-offs

232%

135%

1,415%

1,577%

168%

Nonperforming assets/total assets

0.22%

0.21%

0.21%

0.24%

0.23%

Quarterly GAAP to Non-GAAP Reconciliations

 

 

 

 

 

Income statement data

 

 

 

 

 

Pre-tax, pre-provision net revenue

 

 

 

 

 

Net income (GAAP)

$5,798

$52,530

$48,691

$39,805

$47,055

Income taxes

1,175

14,779

13,706

10,971

12,777

Income before income taxes

6,973

67,309

62,397

50,776

59,832

Provision for credit losses

3,500

2,768

5,061

6,038

906

Pre-tax, pre-provision net revenue (non-GAAP)

10,473

70,077

67,458

56,814

60,738

Acquisition expenses

57

353

409

3,960

299

Acquisition-related contingent consideration adjustment

0

(700)

0

400

0

Loss on sales of investment securities

52,329

0

0

0

0

Gain on debt extinguishment

(242)

0

0

0

0

Unrealized loss (gain) on equity securities

0

20

4

22

(2)

Adjusted pre-tax, pre-provision net revenue (non-GAAP)

$62,617

$69,750

$67,871

$61,196

$61,035

 

 

 

 

 

 

Pre-tax, pre-provision net revenue per share

 

 

 

 

 

Diluted earnings per share (GAAP)

$0.11

$0.97

$0.90

$0.73

$0.86

Income taxes

0.02

0.27

0.25

0.20

0.24

Income before income taxes

0.13

1.24

1.15

0.93

1.10

Provision for credit losses

0.07

0.06

0.10

0.12

0.01

Pre-tax, pre-provision net revenue per share (non-GAAP)

0.20

1.30

1.25

1.05

1.11

Acquisition expenses

0.00

0.00

0.00

0.07

0.01

Acquisition-related contingent consideration adjustment

0.00

(0.01)

0.00

0.01

0.00

Loss on sales of investment securities

0.96

0.00

0.00

0.00

0.00

Gain on debt extinguishment

0.00

0.00

0.00

0.00

0.00

Unrealized loss (gain) on equity securities

0.00

0.00

0.00

0.00

0.00

Adjusted pre-tax, pre-provision net revenue per share (non-GAAP)

$1.16

$1.29

$1.25

$1.13

$1.12

 

 

 

 

 

 

 

 

 

 

 

 

Summary of Financial Data (unaudited)

 

 

 

 

 

(Dollars in thousands, except per share data)

 

 

 

 

 

 

2023

2022

 

1st Qtr

4th Qtr

3rd Qtr

2nd Qtr

1st Qtr

Quarterly GAAP to Non-GAAP Reconciliations

 

 

 

 

 

Income statement data

 

 

 

 

 

Net income

 

 

 

 

 

Net income (GAAP)

$5,798

$52,530

$48,691

$39,805

$47,055

Acquisition expenses

57

353

409

3,960

299

Tax effect of acquisition expenses

(12)

(78)

(90)

(856)

(64)

Subtotal (non-GAAP)

5,843

52,805

49,010

42,909

47,290

Acquisition-related contingent consideration adjustment

0

(700)

0

400

0

Tax effect of acquisition-related contingent consideration adjustment

0

154

0

(86)

0

Subtotal (non-GAAP)

5,843

52,259

49,010

43,223

47,290

Acquisition-related provision for credit losses

0

0

0

3,927

0

Tax effect of acquisition-related provision for credit losses

0

0

0

(848)

0

Subtotal (non-GAAP)

5,843

52,259

49,010

46,302

47,290

Loss on sales of investment securities

52,329

0

0

0

0

Tax effect of loss on sales of investment securities

(11,171)

0

0

0

0

Subtotal (non-GAAP)

47,001

52,259

49,010

46,302

47,290

Gain on debt extinguishment

(242)

0

0

0

0

Tax effect of gain on debt extinguishment

52

0

0

0

0

Subtotal (non-GAAP)

46,811

52,259

49,010

46,302

47,290

Unrealized loss (gain) on equity securities

0

20

4

22

(2)

Tax effect of unrealized loss (gain) on equity securities

0

(4)

(1)

(5)

0

Operating net income (non-GAAP)

46,811

52,275

49,013

46,319

47,288

Amortization of intangibles

3,667

3,794

3,837

3,851

3,732

Tax effect of amortization of intangibles

(783)

(833)

(843)

(832)

(797)

Subtotal (non-GAAP)

49,695

55,236

52,007

49,338

50,223

Acquired non-PCD loan accretion

(1,079)

(1,138)

(1,397)

(1,023)

(734)

Tax effect of acquired non-PCD loan accretion

230

250

307

221

157

Adjusted net income (non-GAAP)

$48,846

$54,348

$50,917

$48,536

$49,646

 

 

 

 

 

 

Return on average assets

 

 

 

 

 

Adjusted net income (non-GAAP)

$48,846

$54,348

$50,917

$48,536

$49,646

Average total assets

15,366,863

15,665,726

15,553,296

15,452,712

15,596,209

Adjusted return on average assets (non-GAAP)

1.29%

1.38%

1.30%

1.26%

1.29%

 

 

 

 

 

 

Return on average equity

 

 

 

 

 

Adjusted net income (non-GAAP)

$48,846

$54,348

$50,917

$48,536

$49,646

Average total equity

1,576,717

1,476,093

1,680,525

1,743,410

2,040,843

Adjusted return on average equity (non-GAAP)

12.56%

14.61%

12.02%

11.17%

9.87%

 

 

 

 

 

 

 

 

 

 

 

 

Summary of Financial Data (unaudited)

 

 

 

 

 

(Dollars in thousands, except per share data)

 

 

 

 

 

 

2023

2022

 

1st Qtr

4th Qtr

3rd Qtr

2nd Qtr

1st Qtr

Quarterly GAAP to Non-GAAP Reconciliations

 

 

 

 

 

Income statement data

 

 

 

 

 

Earnings per common share

 

 

 

 

 

Diluted earnings per share (GAAP)

$0.11

$0.97

$0.90

$0.73

$0.86

Acquisition expenses

0.00

0.00

0.00

0.07

0.01

Tax effect of acquisition expenses

0.00

0.00

0.00

(0.02)

0.00

Subtotal (non-GAAP)

0.11

0.97

0.90

0.78

0.87

Acquisition-related contingent consideration adjustment

0.00

(0.01)

0.00

0.01

0.00

Tax effect of acquisition-related contingent consideration adjustment

0.00

0.00

0.00

0.00

0.00

Subtotal (non-GAAP)

0.11

0.96

0.90

0.79

0.87

Acquisition-related provision for credit losses

0.00

0.00

0.00

0.07

0.00

Tax effect of acquisition-related for provision credit losses

0.00

0.00

0.00

(0.01)

0.00

Subtotal (non-GAAP)

0.11

0.96

0.90

0.85

0.87

Loss on sales of investment securities

0.96

0.00

0.00

0.00

0.00

Tax effect of loss on sales of investment securities

(0.21)

0.00

0.00

0.00

0.00

Subtotal (non-GAAP)

0.86

0.96

0.90

0.85

0.87

Gain on debt extinguishment

0.00

0.00

0.00

0.00

0.00

Tax effect of gain on debt extinguishment

0.00

0.00

0.00

0.00

0.00

Subtotal (non-GAAP)

0.86

0.96

0.90

0.85

0.87

Unrealized loss (gain) on equity securities

0.00

0.00

0.00

0.00

0.00

Tax effect of unrealized loss (gain) on equity securities

0.00

0.00

0.00

0.00

0.00

Operating diluted earnings per share (non-GAAP)

0.86

0.96

0.90

0.85

0.87

Amortization of intangibles

0.07

0.07

0.07

0.07

0.07

Tax effect of amortization of intangibles

(0.01)

(0.02)

(0.02)

(0.02)

(0.02)

Subtotal (non-GAAP)

0.92

1.01

0.95

0.90

0.92

Acquired non-PCD loan accretion

(0.02)

(0.02)

(0.02)

(0.02)

(0.01)

Tax effect of acquired non-PCD loan accretion

0.00

0.01

0.01

0.01

0.00

Diluted adjusted net earnings per share (non-GAAP)

$0.90

$1.00

$0.94

$0.89

$0.91

 

 

 

 

 

 

Noninterest operating expenses

 

 

 

 

 

Noninterest expenses (GAAP)

$114,052

$105,852

$108,185

$110,424

$99,807

Amortization of intangibles

(3,667)

(3,794)

(3,837)

(3,851)

(3,732)

Acquisition expenses

(57)

(353)

(409)

(3,960)

(299)

Acquisition-related contingent consideration adjustment

0

700

0

(400)

0

Total adjusted noninterest expenses (non-GAAP)

$110,328

$102,405

$103,939

$102,213

$95,776

 

 

 

 

 

 

Efficiency ratio (GAAP)

 

 

 

 

 

Noninterest expenses (GAAP) – numerator

$114,052

$105,852

$108,185

$110,424

$99,807

Net interest income (GAAP)

111,030

112,223

110,394

103,141

94,872

Noninterest revenues (GAAP)

13,495

63,706

65,249

64,097

65,673

Total revenues (GAAP) – denominator

124,525

175,929

175,643

167,238

160,545

Efficiency ratio (GAAP)

91.6%

60.2%

61.6%

66.0%

62.2%

 

 

 

 

 

 

Summary of Financial Data (unaudited)

 

 

 

 

 

(Dollars in thousands, except per share data)

 

 

 

 

 

 

2023

2022

 

1st Qtr

4th Qtr

3rd Qtr

2nd Qtr

1st Qtr

Quarterly GAAP to Non-GAAP Reconciliations

 

 

 

 

 

Income statement data (continued)

 

 

 

 

 

Efficiency ratio (non-GAAP)

 

 

 

 

 

Adjusted noninterest expenses (non-GAAP) - numerator

$110,328

$102,405

$103,939

$102,213

$95,776

Fully tax-equivalent net interest income

112,121

113,341

111,512

104,149

95,702

Noninterest revenues

13,495

63,706

65,249

64,097

65,673

Acquired non-PCD loan accretion

(1,079)

(1,138)

(1,397)

(1,023)

(734)

Unrealized loss (gain) on equity securities

0

20

4

22

(2)

Loss on sales of investment securities

52,329

0

0

0

0

Gain on debt extinguishment

(242)

0

0

0

0

Operating revenues (non-GAAP) - denominator

176,624

175,929

175,368

167,245

160,639

Efficiency ratio (non-GAAP)

62.5%

58.2%

59.3%

61.1%

59.6%

 

 

 

 

 

 

Balance sheet data

 

 

 

 

 

Total assets

 

 

 

 

 

Total assets (GAAP)

$15,255,953

$15,835,651

$15,594,547

$15,487,833

$15,625,883

Intangible assets

(900,914)

(902,837)

(909,224)

(917,891)

(863,038)

Deferred taxes on intangible assets

45,369

46,130

48,893

45,349

43,968

Total tangible assets (non-GAAP)

$14,400,408

$14,978,944

$14,734,216

$14,615,291

$14,806,813

 

 

 

 

 

 

Total common equity

 

 

 

 

 

Shareholders' equity (GAAP)

$1,634,013

$1,551,705

$1,461,163

$1,661,696

$1,852,103

Intangible assets

(900,914)

(902,837)

(909,224)

(917,891)

(863,038)

Deferred taxes on intangible assets

45,369

46,130

48,893

45,349

43,968

Total tangible common equity (non-GAAP)

$778,468

$694,998

$600,832

$789,154

$1,033,033

 

 

 

 

 

 

Shareholders’ equity-to-assets ratio at quarter end

 

 

 

 

 

Total shareholders’ equity (GAAP) - numerator

$1,634,013

$1,551,705

$1,461,163

$1,661,696

$1,852,103

Total assets (GAAP) - denominator

15,255,953

15,835,651

15,594,547

15,487,833

15,625,883

Net shareholders’ equity-to-assets ratio at quarter end (GAAP)

10.71%

9.80%

9.37%

10.73%

11.85%

 

 

 

 

 

 

Net tangible equity-to-assets ratio at quarter end

 

 

 

 

 

Total tangible common equity (non-GAAP) - numerator

$778,468

$694,998

$600,832

$789,154

$1,033,033

Total tangible assets (non-GAAP) - denominator

14,400,408

14,978,944

14,734,216

14,615,291

14,806,813

Net tangible equity-to-assets ratio at quarter end (non-GAAP)

5.41%

4.64%

4.08%

5.40%

6.98%

 

 

 

 

 

 

 

 

 

 

 

 

(1) Excludes loss on sales of investment securities, gain on debt extinguishment and unrealized gain (loss) on equity securities.

(2) Includes deferred tax liabilities related to certain intangible assets.

 

Contacts

Joseph E. Sutaris, EVP & Chief Financial Officer

Office: (315) 445-7396

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