Tompkins Financial Corporation (NYSE American: TMP)
Tompkins Financial Corporation announced net income attributable
to common shareholders of $7.9 million, or $0.53 per diluted common
share for the first quarter of 2020, compared to $21.0 million, or
$1.37 per diluted common share, for the first quarter of 2019.
Results for the first quarter of 2020 were negatively impacted by
current economic stress resulting from the COVID-19 pandemic, which
contributed to the $16.3 million provision for credit losses
recognized during the quarter under the new current expected credit
losses (CECL) accounting standard. Refer to "Asset Quality" section
for further discussion of the impact on the Company's financial
statements upon adoption of this new accounting guidance.
"These are clearly unprecedented times for our country and our
communities. I am extremely proud of the exceptional way the
Tompkins team has stepped up to the current environment by
addressing the specific challenges of our clients and communities
who are facing hardships due to the COVID-19 pandemic. Though these
are unprecedented times, Tompkins enters this environment well
prepared to face the many challenges and difficulties we are all
dealing with as a result of the pandemic. Over recent years, we
have invested significantly in digital technologies to improve
capabilities that allow our customers to bank remotely. We have
also invested significantly in our internal systems, which allowed
nearly 100% of our non-retail employees to transition quickly and
securely to remote working environments with limited disruption to
our business. Furthermore, we entered 2020 with a strong financial
position, coming off a year of record earnings per share in 2019,
and with our 2019 Risk Based Capital Ratio at its highest level
since 2014."
SELECTED HIGHLIGHTS FOR THE FIRST QUARTER:
Despite the decline in earnings from the prior year, there were
several favorable trends noted during the first quarter of 2020,
including:
- Total loans of $4.9 billion were up 3.1% over March 31,
2019
- Total deposits of $5.4 billion increased by 8.4% over March 31,
2019
- Noninterest bearing deposits of $1.4 billion increased by 5.6%
over March 31, 2019
- Net interest margin was 3.44% for the first quarter of 2020, up
from 3.34% for the first quarter of 2019, and 3.43% for the fourth
quarter of 2019
NET INTEREST INCOME
Net interest margin was 3.44% for the first quarter of 2020, up
compared to the 3.34% reported for the first quarter of 2019, and
3.43% for the trailing quarter ended December 31, 2019. The
improved net interest margin year-over-year was largely driven by
lower other borrowing balances and funding costs, primarily in
other borrowings. Net interest income of $53.0 million for the
first quarter of 2020 was up 2.0% compared to the first quarter of
2019.
NONINTEREST INCOME
Noninterest income represented 26.4% of total revenues in the
first quarter of 2020, compared to 27.2% in the first quarter of
2019. Noninterest income of $19.0 million was down 2.3% compared to
the same period in 2019. Noninterest income in the first quarter of
2019 included a one-time incentive payment of $500,000 (pre-tax)
related to our card services business.
NONINTEREST EXPENSE
Noninterest expense was $45.7 million for the first quarter of
2020, which was up 3.5% from the same period in 2019, and in line
with the fourth quarter of 2019. The increase in noninterest
expense from the same period last year was mainly related to higher
salaries and wages in the first quarter of 2020, largely reflective
of merit increases awarded in 2019.
INCOME TAX EXPENSE
The Company's effective tax rate was 19.4% in the first quarter
of 2020, compared to 21.0% for the same period in 2019.
ASSET QUALITY
Asset quality trends remained strong in the first quarter of
2020. Nonperforming assets represented 0.46% of total assets at
March 31, 2020, down slightly from 0.47% at December 31, 2019.
Nonperforming asset levels continue to be below the most recent
Federal Reserve Board Peer Group Average1 of 0.56%.
Net charge-offs for the first quarter of 2020 were $1.2 million
compared to $3.5 million reported in the first quarter of 2019. Net
charge-offs of $1.2 million in the first quarter of 2020 was
largely related to a single credit, while the first quarter of 2019
included a $3.1 million write-down of one credit, both in the
commercial real estate portfolio.
The Company adopted Accounting Standards Update (“ASU”) 2016-13,
“Financial Instruments – Credit Losses (Topic 326): Measurement of
Credit Losses on Financial Instruments” (“CECL”), effective January
1, 2020. The Company recorded a net increase to retained earnings
of $1.7 million upon adoption of the new standard. The transition
adjustment at January 1, 2020 included a $2.5 million decrease in
the allowance for credit losses on loans, and a $0.4 million
increase in the allowance for credit losses on off-balance sheet
credit exposures, net of the corresponding $0.4 million decrease in
deferred tax assets. The provision for credit losses for the first
quarter of 2020 was $16.3 million, increasing the allowance for
credit losses to $52.4 million at March 31, 2020. The increase in
the first quarter of 2020 was not a direct result of specific
credit risks currently identified in the loan portfolio; rather,
the increase was largely a result of the impact of the current
economic shutdown related to COVID-19 on economic forecasts and
other model assumptions relied upon by management in determining
the allowance.
The allowance for credit losses represented 1.06% of total loans
and leases at March 31, 2020, compared to 0.81% at December 31,
2019, and 0.84% at March 31, 2019. The ratio of the allowance to
total nonperforming loans and leases was 170.74% at March 31, 2020,
compared to 126.90% at December 31, 2019, and 175.51% at March 31,
2019.
CAPITAL POSITION
Capital ratios remained well above the regulatory minimums for
well capitalized institutions. The ratio of Tier 1 capital to
average assets was 9.53% at March 31, 2020, down slightly from
9.61% at December 31, 2019, and improved from 9.24% at March 31,
2019. Consistent with the Company's capital planning practices,
during the quarter ended March 31, 2020, the Company repurchased
71,288 shares of common stock at an average price of $78.83 per
share. On March 19, 2020, following the announcement of the
national emergency related to the COVID-19 pandemic, the Company
suspended the purchase of shares under the Company’s share
repurchase program. During the quarter ended December 31, 2019, the
Company repurchased 35,821 shares of common stock at an average
price of $80.25 per share. There were no shares repurchased during
the first quarter of 2019.
IMPACT OF, AND RESPONSE TO, COVID-19 PANDEMIC
Economic Environment
The COVID-19 outbreak has led to government-mandated closures
and stay at home orders across the nation, which have resulted in
deteriorating economic conditions throughout the U.S. The various
government orders issued in response to the pandemic are
significantly impacting the U.S. labor market, consumer spending
and business investments. During March 2020, in response to the
deteriorating economic conditions, the Federal Reserve reduced the
federal funds rate 1.5 percentage points, to .00 to .25 percent.
The Federal Reserve also provided a pandemic-related stimulus
package estimated at $4.0 trillion, in order to ease the stress on
financial markets. In addition, the United States Congress passed
the Coronavirus Aid, Relief and Economic Security Act ("CARES
Act"), which would provide approximately $2.5 trillion of support
to U.S. citizens and businesses affected by COVID-19.
Company Response
During the first quarter of 2020, the Company designated a
Pandemic Planning Committee, made up of members of Senior
Management, to oversee the Company’s response to COVID-19. The
Company implemented a number of risk mitigation measures designed
to protect our employees and customers, while maintaining services
for our customers and community. These measures included
restrictions on business travel and establishment of a remote work
environment for all non-customer facing employees. The Company also
implemented drive-up only or by appointment only operations across
its branch network.
Currently, over 85% of our workforce is working remotely and we
have imposed social distancing restrictions and provided premium
pay for those employees who are required to be on premise to
complete essential on-site functions. Due to the significant
uncertainty of the current economic climate, and the Company's
ongoing response to the pandemic and related shutdowns, annual pay
increases for our Company's executive officers (which is comprised
of our Senior Leadership Team members) have been deferred
indefinitely.
As previously announced, Tompkins has initiated and participated
in a number of credit initiatives to support employees and
customers who have been impacted by the shutdown associated with
the COVID-19 pandemic. For non-executive employees affected by
COVID-19, the Company implemented a low interest loan program. The
Company also implemented a payment deferral program to assist both
consumer and business borrowers that may be experiencing financial
hardship due to COVID-19. The current standard program allows for
the deferral of loan payments for up to 90 days and customers will
be able to request a payment deferral until the middle of May 2020.
As of April 20, 2020, the Company had granted payment deferral
requests for approximately 2,800 loans to individuals and
businesses.
The Company is participating in the U.S. Small Business
Administration (SBA) Paycheck Protection Program (“PPP”). This
program provides borrower guarantees for lenders, as well as loan
forgiveness incentives for borrowers that utilize the loan proceeds
to cover employee compensation-related expenses and certain other
eligible business operating costs, all in accordance with the rules
and regulations established by the SBA. The Company began accepting
applications for PPP loans on April 3, 2020, and has approved
approximately 2,900 loans totaling about $500 million.
Mr. Romaine added, “We enter the second quarter of 2020 in a
period of significant uncertainty surrounding the COVID-19 pandemic
and related economic shut-downs. Our long held philosophy of
maintaining Tompkins as a sustainable high performing company,
supported with prudent risk management practices, is now more
important than ever. We believe our healthy capital and liquidity
positions will provide flexibility to respond to current
challenges. The overall impact of COVID-19 on our consolidated
results of operations for the three months ended March 31, 2020 was
limited, with the exception of our provision for credit losses. We
did see some slowdown toward the end of the first quarter in other
areas of our business, including reduced transaction volumes in our
card services business, a decrease in wealth management fees due to
the decline in financial markets, and decreases in certain other
fee related income. However, the extent to which the COVID-19
pandemic will affect our business, results of operation and
financial condition going forward is difficult to predict and
depends on numerous evolving factors.”
There is currently a great deal of uncertainty regarding the
length of the COVID-19 pandemic and the efficacy of the
extraordinary measures being put in place to address it. If efforts
to contain COVID-19 are not as successful as anticipated, if
restrictions on movement last into the third quarter or beyond, or
if the federal government's economic stimulus packages are
ineffective or delayed, the current economic downturn will likely
be much longer and much more severe. The deeper the economic
downturn is, and the longer it lasts, the more it will damage
consumer fundamentals and sentiment. Similarly, an extended global
recession due to COVID-19 would weaken the U.S. recovery and damage
business fundamentals. As a result, the pandemic and its
consequences, including responsive measures to manage it, have
negatively impacted, and may continue to negatively impact, demand
for and profitability of our products and services, the valuation
of our assets, the ability of borrowers to satisfy obligations, and
our ability to meet the needs of our customers, all of which could
have a material adverse effect on our business and financial
performance.
ABOUT TOMPKINS FINANCIAL CORPORATION
Tompkins Financial Corporation is a financial services company
serving the Central, Western, and Hudson Valley regions of New York
and the Southeastern region of Pennsylvania. Headquartered in
Ithaca, NY, Tompkins Financial is parent to Tompkins Trust Company,
Tompkins Bank of Castile, Tompkins Mahopac Bank, Tompkins VIST
Bank, Tompkins Insurance Agencies, Inc., and offers wealth
management services through Tompkins Financial Advisors. For more
information on Tompkins Financial, visit www.tompkinsfinancial.com.
"Safe Harbor" Statement under the Private Securities
Litigation Reform of 1995:
This press release may contain “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements are neither historical facts
nor assurances of future performance. Examples of forward-looking
statements in this press release include, without limitation, those
regarding the novel coronavirus (COVID-19) and our plans in
response to the coronavirus. Forward-looking statements may be
identified by use of such words as "may", "will", "estimate",
"intend", "continue", "believe", "expect", "plan", or "anticipate",
and other similar words. Forward-looking statements are made based
on management’s expectations and beliefs concerning future events
impacting the Company and are subject to certain 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. The
following factors, in addition to those listed as Risk Factors in
Item 1A of our Annual Report on Form 10-K for the year ended
December 31, 2019, are among those that could cause actual results
to differ materially from the forward-looking statements: changes
in general economic, market and regulatory conditions; the severity
and duration of the coronavirus outbreak and the impact of the
outbreak (including the government’s response to the outbreak) on
economic and financial markets, potential regulatory actions, and
modifications to our operations, products, and services relating
thereto; disruptions in our and our customers’ operations and loss
of revenue due to pandemics, epidemics, widespread health
emergencies, government-imposed travel/business restrictions, or
outbreaks of infectious diseases such as the coronavirus, and the
associated adverse impact on our financial position, liquidity, and
our customers’ abilities to repay their obligations to us or
willingness to obtain financial services products from the Company;
the development of an interest rate environment that may adversely
affect the Company’s interest rate spread, 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,
such as the Dodd-Frank Act, Basel III and the Economic Growth,
Regulatory Relief, and Consumer Protection Act; legislative and
regulatory changes in response to COVID-19 with which we and our
subsidiaries must comply, including the CARES Act and the rules and
regulations promulgated thereunder, and state and local government
mandates; technological developments and changes; 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; and financial resources in the amounts, at the times and
on the terms required to support the Company’s future businesses.
The Company does not undertake any obligation to update its
forward-looking statements.
TOMPKINS FINANCIAL
CORPORATION
CONDENSED CONSOLIDATED
STATEMENTS OF CONDITION
(In thousands, except share and per share
data)
As of
As of
ASSETS
03/31/2020
12/31/2019
Cash and noninterest bearing balances due
from banks
$
110,998
$
136,010
Interest bearing balances due from
banks
4,265
1,972
Cash and Cash
Equivalents
115,263
137,982
Available-for-sale securities, at fair
value (amortized cost of $1,318,416 at March 31, 2020 and
$1,293,239 at December 31, 2019)
1,352,637
1,298,587
Equity securities, at fair value
(amortized cost $930 at March 31, 2020 and $915 at December 31,
2019)
930
915
Originated loans and leases, net of
unearned income and deferred costs and fees
4,724,277
4,697,401
Acquired loans
213,545
220,149
Less: Allowance for credit losses
52,404
39,892
Net Loans and Leases
4,885,418
4,877,658
Federal Home Loan Bank and other stock
24,212
33,695
Bank premises and equipment, net
93,604
94,355
Corporate owned life insurance
82,872
82,961
Goodwill
92,447
92,447
Other intangible assets, net
5,847
6,223
Accrued interest and other assets
89,884
100,800
Total Assets
$
6,743,114
$
6,725,623
LIABILITIES
Deposits:
Interest bearing:
Checking, savings and money market
3,273,813
3,080,686
Time
708,933
675,014
Noninterest bearing
1,426,617
1,457,221
Total Deposits
5,409,363
5,212,921
Federal funds purchased and securities
sold under agreements to repurchase
68,993
60,346
Other borrowings
457,983
658,100
Trust preferred debentures
17,078
17,035
Other liabilities
107,100
114,167
Total Liabilities
$
6,060,517
$
6,062,569
EQUITY
Tompkins Financial Corporation
shareholders' equity:
Common Stock - par value $.10 per share:
Authorized 25,000,000 shares; Issued: 14,943,857 at March 31, 2020;
and 15,014,499 at December 31, 2019
1,494
1,501
Additional paid-in capital
333,662
338,507
Retained earnings
372,344
370,477
Accumulated other comprehensive loss
(21,271
)
(43,564
)
Treasury stock, at cost – 117,940 shares
at March 31, 2020, and 123,956 shares at December 31, 2019
(5,076
)
(5,279
)
Total Tompkins Financial
Corporation Shareholders’ Equity
681,153
661,642
Noncontrolling interests
1,444
1,412
Total Equity
$
682,597
$
663,054
Total Liabilities and
Equity
$
6,743,114
$
6,725,623
TOMPKINS FINANCIAL
CORPORATION
CONDENSED CONSOLIDATED
STATEMENTS OF INCOME
(In thousands, except per share data)
(Unaudited)
Three Months Ended
03/31/2020
03/31/2019
INTEREST AND DIVIDEND INCOME
Loans
$
55,614
$
55,324
Due from banks
6
10
Available-for-sale securities
7,144
7,858
Held-to-maturity securities
0
858
Federal Home Loan Bank and other stock
435
878
Total Interest and Dividend
Income
63,199
64,928
INTEREST EXPENSE
Time certificates of deposits of $250,000
or more
843
586
Other deposits
6,356
6,011
Federal funds purchased and securities
sold under agreements to repurchase
36
44
Trust preferred debentures
289
329
Other borrowings
2,706
6,044
Total Interest Expense
10,230
13,014
Net Interest Income
52,969
51,914
Less: Provision for credit loss
expense
16,294
445
Net Interest Income After
Provision for Credit Loss Expense
36,675
51,469
NONINTEREST INCOME
Insurance commissions and fees
8,045
8,045
Investment services income
4,202
4,084
Service charges on deposit accounts
1,983
1,998
Card services income
2,183
2,790
Other income
2,104
2,478
Net gain on securities transactions
443
12
Total Noninterest Income
18,960
19,407
NONINTEREST EXPENSE
Salaries and wages
22,494
21,101
Other employee benefits
5,684
5,611
Net occupancy expense of premises
3,328
3,601
Furniture and fixture expense
1,985
1,979
Amortization of intangible assets
374
412
Other operating expense
11,875
11,505
Total Noninterest Expenses
45,740
44,209
Income Before Income Tax
Expense
9,895
26,667
Income Tax Expense
1,909
5,595
Net Income Attributable to
Noncontrolling Interests and Tompkins Financial Corporation
7,986
21,072
Less: Net Income Attributable to
Noncontrolling Interests
37
32
Net Income Attributable to
Tompkins Financial Corporation
$
7,949
$
21,040
Basic Earnings Per Share
$
0.53
$
1.37
Diluted Earnings Per Share
$
0.53
$
1.37
Average Consolidated Statements of
Condition and Net Interest Analysis (Unaudited)
Quarter Ended
Quarter Ended
March 31, 2020
March 31, 2019
Average
Average
Balance
Average
Balance
Average
(Dollar amounts in thousands)
Quarter
Ended
Interest
Yield/
Rate
Year
Ended
Interest
Yield/
Rate
ASSETS
Interest-earning assets
Interest-bearing balances due from
banks
$
1,525
$
6
1.58
%
$
2,334
$
10
1.74
%
Securities (2)
U.S. Government securities
1,194,754
6,576
2.21
%
1,409,305
8,172
2.35
%
State and municipal (3)
97,480
666
2.75
%
94,609
626
2.68
%
Other securities (3)
3,422
36
4.23
%
3,415
41
4.87
%
Total securities
1,295,656
7,278
2.26
%
1,507,329
8,839
2.38
%
FHLBNY and other stock
26,558
435
6.59
%
48,055
878
7.41
%
Total loans and leases, net of unearned
income (3)(4)
4,914,034
55,906
4.58
%
4,792,607
55,614
4.71
%
Total interest-earning assets
6,237,773
63,625
4.10
%
6,350,325
65,341
4.17
%
Other assets
435,175
393,035
Total assets
$
6,672,948
$
6,743,360
LIABILITIES & EQUITY
Deposits
Interest-bearing deposits
Interest bearing checking, savings &
money market
$
3,212,543
4,366
0.55
%
$
2,940,416
4,470
0.62
%
Time deposits
680,248
2,833
1.68
%
645,144
2,127
1.34
%
Total interest-bearing deposits
3,892,791
7,199
0.74
%
3,585,560
6,597
0.75
%
Federal funds purchased & securities
sold under
agreements to repurchase
63,528
36
0.23
%
72,664
44
0.25
%
Other borrowings
498,428
2,706
2.18
%
993,773
6,044
2.47
%
Trust preferred debentures
17,050
289
6.82
%
16,878
329
7.90
%
Total interest-bearing
liabilities
4,471,797
10,230
0.92
%
4,668,875
13,014
1.13
%
Non-interest bearing deposits
1,409,661
1,338,623
Accrued expenses and other liabilities
112,673
105,131
Total liabilities
5,994,131
6,112,629
Tompkins Financial Corporation
Shareholders’ equity
677,394
629,305
Noncontrolling interest
1,423
1,426
Total equity
678,817
630,731
Total liabilities and equity
$
6,672,948
$
6,743,360
Interest rate spread
3.18
%
3.04
%
Net interest income/margin on earning
assets
53,395
3.44
%
52,327
3.34
%
Tax equivalent adjustments
(426)
(413)
Net interest income per consolidated
financial statements
$
52,969
$
51,914
Tompkins Financial Corporation - Summary Financial Data
(Unaudited)
(In thousands, except per share data)
Quarter-Ended
Year-Ended
Period End Balance Sheet
Mar-20
Dec-19
Sep-19
Jun-19
Mar-19
Dec-19
Securities
$
1,353,567
$
1,299,502
$
1,282,026
$
1,330,719
$
1,484,151
$
1,299,502
Total Loans
4,937,822
4,917,550
4,857,073
4,855,802
4,789,700
4,917,550
Allowance for credit losses
52,404
39,892
41,371
40,790
40,328
39,892
Total assets
6,743,114
6,725,623
6,627,982
6,654,390
6,738,719
6,725,623
Total deposits
5,409,363
5,212,921
5,369,990
4,988,897
4,989,925
5,212,921
Federal funds purchased and securities
sold under agreements to repurchase
68,993
60,346
50,541
63,978
66,918
60,346
Other borrowings
457,983
658,100
429,000
824,562
923,427
658,100
Trust preferred debentures
17,078
17,035
16,992
16,949
16,906
17,035
Total common equity
681,153
661,642
658,358
656,201
645,823
661,642
Total equity
682,597
663,054
659,865
657,677
647,267
663,054
Average Balance Sheet
Average earning assets
$
6,237,773
$
6,188,442
$
6,203,078
$
6,337,983
$
6,350,325
$
6,268,440
Average assets
6,672,948
6,613,202
6,621,412
6,742,409
6,743,360
6,679,578
Average interest-bearing liabilities
4,471,797
4,374,572
4,415,079
4,638,249
4,668,875
4,523,088
Average equity
678,817
664,441
659,650
650,079
630,731
651,341
Share data
Weighted average shares outstanding
(basic)
14,718,948
14,726,023
14,827,114
15,019,710
15,060,175
14,907,057
Weighted average shares outstanding
(diluted)
14,774,269
14,790,503
14,887,626
15,085,945
15,136,523
14,973,951
Period-end shares outstanding
14,907,947
14,978,589
14,975,750
15,160,719
15,314,078
14,978,589
Common equity book value per share
$
45.69
$
44.17
$
43.96
$
43.28
$
42.17
$
44.17
Tangible book value per share
(Non-GAAP)**
$
39.15
$
37.64
$
37.40
$
36.77
$
35.73
$
37.64
** 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
$
52,969
$
53,240
$
53,156
$
52,318
$
51,914
$
210,628
Provision for credit loss expense
16,294
(1,000
)
1,320
601
445
1,366
Noninterest income
18,960
17,972
19,534
18,520
19,407
75,433
Noninterest expense
45,740
45,900
45,655
46,070
44,209
181,834
Income tax expense
1,909
5,200
5,478
4,743
5,595
21,016
Net income attributable to Tompkins
Financial Corporation
7,949
21,080
20,206
19,392
21,040
81,718
Noncontrolling interests
37
32
31
32
32
127
Basic earnings per share (5)
$
0.53
$
1.41
$
1.34
$
1.27
$
1.37
$
5.39
Diluted earnings per share (5)
$
0.53
$
1.40
$
1.34
$
1.27
$
1.37
$
5.37
Nonperforming Assets
Originated nonaccrual loans and leases
$
21,472
$
22,485
$
21,404
$
16,543
$
15,165
$
22,485
Acquired nonaccrual loans and leases
2,084
1,796
2,164
2,363
2,579
1,796
Originated loans and leases 90 days past
due and accruing
0
0
0
0
0
0
Troubled debt restructuring not included
above
7,137
7,154
6,528
4,889
5,234
7,154
Total nonperforming loans and leases
30,693
31,435
30,096
23,795
22,978
31,435
OREO
466
428
888
2,229
1,595
428
Total nonperforming assets
$
31,159
$
31,863
$
30,984
$
26,024
$
24,573
$
31,863
Tompkins Financial Corporation - Summary Financial Data
(Unaudited) - continued
Quarter-Ended
Year-Ended
Delinquency - Originated loan and lease
portfolio
Mar-20
Dec-19
Sep-19
Jun-19
Mar-19
Dec-19
Loans and leases 30-89 days past due
and
accruing
$
8,953
$
3,559
$
3,287
$
3,883
$
4,193
$
3,559
Loans and leases 90 days past due and
accruing
0
0
0
0
0
0
Total originated loans and leases past due
and accruing
8,953
3,559
3,287
3,883
4,193
3,559
Delinquency - Acquired loan and lease
portfolio
Loans 30-89 days past due and accruing
(6)
$
375
$
165
$
232
$
493
$
474
$
165
Loans 90 days or more past due
0
794
1,219
1,229
1,218
794
Total acquired loans and leases past due
and accruing
375
959
1,451
1,722
1,692
959
Total loans and leases past due and
accruing
$
9,328
$
4,518
$
4,738
$
5,605
$
5,885
$
4,518
Allowance for Credit Losses
Balance at beginning of period
$
39,892
$
41,371
$
40,790
$
40,328
$
43,410
$
43,410
Impact of adopting ASC 326
(2,534
)
0
0
0
0
0
Provision (credit) for credit losses
16,294
(1,000
)
1,320
601
445
1,366
Net loan and lease charge-offs
1,248
479
739
139
3,527
4,884
Allowance for credit losses at end of
period
$
52,404
$
39,892
$
41,371
$
40,790
$
40,328
$
39,892
Loan Classification - Originated
Portfolio
Special Mention
$
37,121
$
29,800
$
41,314
$
36,619
$
33,689
$
29,800
Substandard
51,951
58,092
58,873
44,770
35,895
58,092
Loan Classification - Acquired
Portfolio
Special Mention
0
0
261
265
270
0
Substandard
943
2,407
2,809
2,857
2,830
2,407
Loan Classifications - Total
Portfolio
Special Mention
37,121
29,800
41,575
36,884
33,959
29,800
Substandard
52,894
60,499
61,682
47,627
38,725
60,499
Ratio Analysis
Credit Quality
Nonperforming loans and leases/total loans
and leases (6)
0.62
%
0.64
%
0.62
%
0.49
%
0.48
%
0.64
%
Nonperforming assets/total assets
0.46
%
0.47
%
0.47
%
0.39
%
0.36
%
0.47
%
Allowance for credit losses/total loans
and leases
1.06
%
0.81
%
0.85
%
0.84
%
0.84
%
0.81
%
Allowance/nonperforming loans and
leases
170.74
%
126.90
%
137.46
%
171.42
%
175.51
%
126.90
%
Net loan and lease losses annualized/total
average loans and leases
0.10
%
0.04
%
0.06
%
0.01
%
0.30
%
0.10
%
Capital Adequacy
Tier 1 Capital (to average assets)
9.53
%
9.61
%
9.43
%
9.25
%
9.24
%
9.61
%
Common Equity Tier 1 Capital (to
risk-weighted assets)
12.20
%
12.33
%
12.14
%
12.13
%
12.19
%
12.33
%
Tompkins Financial Corporation - Summary Financial Data
(Unaudited) - continued
Quarter Ended
Year-Ended
Profitability (period-end)
Mar-20
Dec-19
Sep-19
Jun-19
Mar-19
Dec-19
Return on average assets *
0.48
%
1.26
%
1.21
%
1.15
%
1.27
%
1.22
%
Return on average equity *
4.71
%
12.59
%
12.15
%
11.96
%
13.53
%
12.55
%
Net interest margin (TE) *
3.44
%
3.44
%
3.43
%
3.34
%
3.34
%
3.39
%
* Quarterly ratios have been
annualized
Non-GAAP Measures
This press release contains financial information determined by
methods other than in accordance with accounting principles
generally accepted in the United States of America (GAAP). Where
non-GAAP disclosures are used in this press release, the comparable
GAAP measure, as well as reconciliation to the comparable GAAP
measure, is provided in the 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 Common Equity Book
Value Per Share (GAAP) to Tangible Book Value Per Share
(non-GAAP)
Total common equity
$
681,153
$
661,642
$
658,358
$
656,201
$
645,823
$
661,642
Less: Goodwill and intangibles (7)
97,481
97,855
98,277
98,698
98,694
97,855
Tangible common equity (Non-GAAP)
583,672
563,787
560,081
557,503
547,129
563,787
Ending shares outstanding
14,907,947
14,978,589
14,975,750
15,160,719
15,314,078
14,978,589
Tangible book value per share
(Non-GAAP)
$
39.15
$
37.64
$
37.40
$
36.77
$
35.73
$
37.64
(1) Federal Reserve peer ratio as of
December 31, 2019, the most recent data available, includes banks
and bank holding companies with consolidated assets between $3
billion and $10 billion.
(2) Average balances and yields on
available-for-sale securities are based on historical amortized
cost.
(3) Interest income includes the tax
effects of taxable-equivalent basis.
(4) 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, 2019.
(5) Earnings per share year-to-date may
not equal the sum of the quarterly earnings per share as a result
of rounding of average shares
(6) Certain acquired loans and leases that
are past due are not on nonaccrual and are not included in
nonperforming loans. The risk of credit loss on these loans has
been considered by virtue of the Company's estimate of
acquisition-date fair value and these loans are considered accruing
as the Company primarily recognizes interest income through
accretion of the difference between the carrying value of these
loans and their expected cash flows.
(7) "Goodwill and intangibles" as shown in
the above tables, equal total intangible assets less mortgage
servicing rights.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200501005266/en/
Stephen S. Romaine, President & CEO Francis M. Fetsko,
Executive VP, CFO & COO Tompkins Financial Corporation (888)
503-5753
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