NEWS & EVENTS

NBT Bancorp Inc. Announces Full Year Net Income and Declares Dividend

NORWICH, N.Y., Jan. 23, 2024 (GLOBE NEWSWIRE) -- NBT Bancorp Inc. (“NBT” or the “Company”) (NASDAQ: NBTB) reported net income and diluted earnings per share for the three and twelve months ended December 31, 2023.

Net income for the three months ended December 31, 2023 was $30.4 million, or $0.64 per diluted common share, compared to $36.1 million, or $0.84 per diluted common share, for the three months ended December 31, 2022, and $24.6 million, or $0.54 per diluted common share, in the third quarter of 2023. Operating diluted earnings per share1, a non-GAAP measure, which excludes acquisition expenses, acquisition-related provision for credit losses, securities gains (losses) and impairment of a minority interest equity investment, net of tax, was $0.72 for the fourth quarter of 2023, compared to $0.86 in the fourth quarter of 2022 and $0.84 in the third quarter of 2023.

Net income for the year ended December 31, 2023 was $118.8 million, or $2.65 per diluted common share, compared to $152.0 million, or $3.52 per diluted common share, in the prior year. Operating diluted earnings per share1 was $3.23 for the year ended December 31, 2023, compared to $3.56 in the prior year.

CEO Comments

“NBT’s fourth quarter and full year results reflect our consistent dedication to improving our traditional banking franchise while growing our diversified revenue sources,” said NBT President and CEO John H. Watt, Jr. “In a year characterized by unprecedented market volatility, we grew loans and deposits, maintained strong asset quality, improved our capital position, completed the high-value acquisition of Salisbury Bancorp, Inc., and continued to deliver best-in-class customer service.”

Fourth Quarter Financial Highlights

Net Income
  • Net income of $30.4 million and diluted earnings per share of $0.64
  • Operating net income was $33.9 million and diluted operating earnings per share of $0.721
Net Interest Income / NIM
  • Net interest income on a fully taxable equivalent (“FTE”) basis was $99.8 million1
  • Net interest margin (“NIM”) on an FTE basis was 3.15%1, down 6 basis points (“bps”) from the prior quarter
  • Included in FTE net interest income was $2.6 million of acquisition-related net accretion which positively impacted NIM by 8 bps
  • Earning asset yields of 4.79% were up 16 bps from the prior quarter
  • Total cost of funds of 1.72% was up 22 bps from the prior quarter
Noninterest Income
  • Excluding net securities gains (losses), noninterest income was $38.0 million, or 27.7% of total revenues
Loans and Credit Quality
  • Period end total loans of $9.65 billion as of December 31, 2023, up $1.50 billion from December 31, 2022, and included $1.18 billion of loans acquired from Salisbury Bancorp, Inc. (“Salisbury”)
  • Excluding loans acquired from Salisbury, loans grew $320.6 million, or 3.9%, year-over-year
  • Net charge-offs to average loans were 0.22%
  • Nonperforming loans to total loans were 0.39%, compared to 0.25% in the prior quarter and 0.26% in the fourth quarter of 2022
  • Allowance for loan losses to total loans was 1.19%
Deposits
  • Deposits were $10.97 billion as of December 31, 2023, up $1.47 billion from December 31, 2022, and included $1.31 billion in deposits acquired from Salisbury
  • Total cost of deposits was 1.51% for the fourth quarter of 2023, up 33 bps from the third quarter
  • Full cycle to-date deposit beta of 28%
  • Composition of total deposits is diverse and granular with over 563,000 accounts with an average per account balance of $19,483
Capital
  • Stockholders’ equity was $1.43 billion as of December 31, 2023
  • Tangible book value per share2 was $21.72 at December 31, 2023
  • Tangible equity to assets grew 11% to 7.93%1
  • CET1 ratio of 11.57%; Leverage ratio of 9.71%


Loans

  • Period end total loans were $9.65 billion at December 31, 2023, consistent with the end of the third quarter of 2023 and were $8.15 billion at December 31, 2022.
  • Period end total loans increased $1.50 billion from December 31, 2022, including loans acquired from Salisbury. Commercial and industrial loans increased $88.2 million to $1.35 billion; commercial real estate loans increased $819.0 million to $3.63 billion; and total consumer loans increased $593.4 million to $4.67 billion.
  • Commercial line of credit utilization rate was 20% at December 31, 2023, compared to 22% at September 30, 2023 and 21% at December 31, 2022.

Deposits

  • Total deposits at December 31, 2023 were $10.97 billion, compared to $9.50 billion at December 31, 2022. The Company continued to experience incremental migration from noninterest bearing and low interest checking and savings accounts into higher cost money market and time deposit instruments, during each quarter of 2023.
  • Loan to deposit ratio was 88.0% at December 31, 2023, compared to 85.8% at December 31, 2022. Consistent with historical trends and as seasonally expected, ending deposits declined from September 30, 2023 to December 31, 2023.

Net Interest Income and Net Interest Margin

  • Net interest income for the fourth quarter of 2023 was $99.2 million, which was up $4.3 million, or 4.5%, from the third quarter of 2023 and down $0.6 million, or 0.6%, from the fourth quarter of 2022. The increase in net interest income resulted from the benefit of the full quarter impact of the Salisbury acquisition and was partially offset by the increase in cost of funds outpacing the improvement in asset yields during the quarter.
  • The NIM on an FTE basis for the fourth quarter of 2023 was 3.15%, a decrease of 6 bps from the third quarter of 2023, driven by an increase in the cost of interest-bearing deposits, partly offset by an increase in average earning asset yields and a full quarter impact of acquisition-related net accretion. The NIM on an FTE basis decreased 53 bps from the fourth quarter of 2022 due to the increase in the cost of interest-bearing deposits and higher short-term borrowings costs and average balances, partially offset by higher earning asset yields.
  • Earning asset yields for the three months ended December 31, 2023 increased 16 bps from the prior quarter to 4.79% and increased 77 bps from the same quarter in the prior year. Average earning assets grew $761.0 million, or 6.4%, from the third quarter of 2023 due to the Salisbury acquisition and organic loan growth.
  • Total cost of deposits, including noninterest bearing deposits, was 1.51% for the fourth quarter of 2023, an increase of 33 bps from the prior quarter and up 134 bps from the same period in the prior year.
  • Total cost of funds for the three months ended December 31, 2023 was 1.72%, up 22 bps from the prior quarter and up 135 bps from the fourth quarter of 2022.

Asset Quality and Allowance for Loan Losses

  • Net charge-offs to total average loans was 22 bps compared to 18 bps in both the prior quarter and in the fourth quarter of 2022. Net charge-offs for the portfolios in a planned run-off status represented the majority of total net charge-offs for the quarter and full year.
  • Nonperforming assets to total assets were 0.28% at December 31, 2023, compared to 0.18% at both September 30, 2023 and December 31, 2022. The increase in nonperforming assets was attributable to a diversified, multi-tenant commercial real estate development relationship that was placed into a nonaccrual status in the fourth quarter of 2023, in which NBT is a participant. The relationship is being actively managed and recent appraised values continue to support its carrying value, and as such, no specific reserve has been established.
  • Provision expense for the three months ended December 31, 2023 was $5.1 million, compared to $12.6 million for the third quarter of 2023 and $7.7 million for the fourth quarter of 2022. Included in the provision expense in the third quarter of 2023 was $8.8 million of acquisition-related provision for loan losses.
  • The allowance for loan losses was $114.4 million, or 1.19% of total loans, at December 31, 2023, consistent with September 30, 2023 and 1.24% of total loans at December 31, 2022. The allowance was consistent with the third quarter of 2023 and the increase in the allowance for loan losses from the fourth quarter of 2022 was due to $14.5 million of allowance for acquired Salisbury loans which included both the $8.8 million of non-purchased credit deteriorated allowance recognized through the provision for loan losses and the $5.8 million of purchased credit deteriorated allowance reclassified from loans.
  • The reserve for unfunded loan commitments increased to $5.1 million at December 31, 2023 compared to the prior quarter-end at $4.8 million and to $5.1 million at December 31, 2022. The provision for unfunded loan commitments in the third quarter of 2023 included $0.8 million of acquisition-related provision for unfunded loan commitments.

Noninterest Income        

  • Total noninterest income, excluding securities gains (losses), was $38.0 million for the three months ended December 31, 2023, down $2.4 million from the seasonally high third quarter, and $3.7 million higher, or 10.7%, from the fourth quarter of 2022.
  • Service charges on deposit accounts were higher than the prior quarter and the fourth quarter of 2022 due primarily to the Salisbury acquisition and new account growth.
  • Retirement plan administration fees were down $1.6 million from the prior quarter and were $0.6 million higher than the fourth quarter of 2022. The decrease from the prior quarter, as expected, was due to certain seasonal activity-based fees in the third quarter. The increase from the fourth quarter of 2022 included the impact from the acquisition of Retirement Direct, LLC on July 1, 2023.
  • Wealth management fees were consistent with the prior quarter as certain prior quarter seasonal activity-based fees were offset by the full quarter addition of Salisbury revenues and were $1.1 million higher than the fourth quarter of 2022.
  • Insurance services were down $0.7 million from the third quarter which has comparatively higher levels of policy renewals than the fourth quarter.

Noninterest Expense

  • Total noninterest expense was $92.8 million for the fourth quarter of 2023 compared to $90.8 million in the third quarter of 2023 and $79.5 million in the fourth quarter of 2022. Total noninterest expense, excluding $0.3 million of acquisition expenses in the fourth quarter of 2023, $7.9 million in the third quarter of 2023 and $1.0 million in the fourth quarter of 2022, and the $4.8 million impairment of a minority interest equity investment in the fourth quarter of 2023 increased 5.9% compared to the previous quarter primarily due to a full quarter impact of the Salisbury acquisition and higher professional service fees and increased 11.7% from the fourth quarter of 2022.
  • Salaries and benefits increased 1.6% from the prior quarter driven by the full quarter impact of the Salisbury acquisition and was partially offset by lower quarterly incentive costs.
  • Technology and data services, professional fees and outside services, and advertising increased from the prior quarter and the fourth quarter of 2022 due to the timing of initiatives that occurred following the completion of the Salisbury acquisition in the third quarter.
  • Amortization of intangible assets increased $0.5 million from the prior quarter and $1.6 million from the fourth quarter of 2022 primarily due to the amortization of intangible assets related to the Salisbury acquisition.
  • FDIC assessment expense increased $0.2 million in the prior quarter primarily due to the acquisition of Salisbury and increased $1.1 million from the fourth quarter of 2022 driven by the statutory increase in the FDIC assessment rate.
  • In the fourth quarter of 2023, the Company recorded a full $4.8 million ($0.08 per diluted share) impairment of its minority interest equity investment in a provider of financial and technology services to residential solar equipment installers, due to the uncertainty in the realizability of the investment.

Income Taxes

  • The effective tax rate was 23.5% for the fourth quarter of 2023 which was up from 22.4% in the third quarter of 2023 and 22.6% for the fourth quarter of 2022 and primarily to adjust to a full year tax rate for 2023 of 22.6%, including assessment of acquisition related items.

Capital

  • Tangible common equity to tangible assets1 was 7.93% at December 31, 2023. Tangible book value per share2 was $21.72 at December 31, 2023, $20.39 at September 30, 2023 and $20.65 at December 31, 2022.
  • Stockholders’ equity increased $252.1 million from December 31, 2022 driven by the Salisbury acquisition adding $161.7 million of capital, net income generation of $118.8 million and a $29.1 million increase in accumulated other comprehensive income driven by the change in the market value of securities available for sale, partially offset by dividends declared of $55.9 million and the repurchase of common stock of $4.9 million.
  • December 31, 2023, CET1 capital ratio of 11.57%, leverage ratio of 9.71% and total risk-based capital ratio of 14.75%.

Dividend

  • On January 22, 2024, the Board of Directors approved a first-quarter cash dividend of $0.32 per share, which represents a $0.02 per quarter, or 6.7%, increase over the dividend paid in the first quarter of 2023. The dividend will be paid on March 15, 2024 to stockholders of record as of March 1, 2024.

Stock Repurchase

  • The Company purchased 155,500 shares of its common stock during 2023 at an average price of $31.79 per share under its previously announced share repurchase program. The repurchase program under which these shares were purchased expired on December 31, 2023.
  • On December 18, 2023, the Board of Directors authorized and approved an amendment to the Company’s previously announced stock repurchase program. Pursuant to the amended stock repurchase program, the Company may repurchase up to 2,000,000 of the currently outstanding shares of its common stock with all repurchases under the stock repurchase program to be made by December 31, 2025. The Company may repurchase shares of its common stock from time to time to mitigate the potential dilutive effects of stock-based incentive plans and other potential uses of common stock for corporate purposes.

Conference Call and Webcast

The Company will host a conference call at 8:30 a.m. (Eastern) Wednesday, January 24, 2024, to review fourth quarter 2023 financial results. The audio webcast link, along with the corresponding presentation slides, will be available on the Company’s Event Calendar page at https://www.nbtbancorp.com/bn/presentations-events.html#events and will be archived for twelve months.

Corporate Overview

NBT Bancorp Inc. is a financial holding company headquartered in Norwich, NY, with total assets of $13.31 billion at December 31, 2023. The Company primarily operates through NBT Bank, N.A., a full-service community bank, and through two financial services companies. NBT Bank, N.A. has 153 banking locations in New York, Pennsylvania, Vermont, Massachusetts, New Hampshire, Maine and Connecticut. EPIC Retirement Plan Services, based in Rochester, NY, is a national benefits administration firm. NBT Insurance Agency, LLC, based in Norwich, NY, is a full-service insurance agency. More information about NBT and its divisions is available online at: www.nbtbancorp.com, www.nbtbank.com, www.epicrps.com and www.nbtinsurance.com.

Forward-Looking Statements

This press release contains forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. These statements may be identified by the use of phrases such as “anticipate,” “believe,” “expect,” “forecasts,” “projects,” “will,” “can,” “would,” “should,” “could,” “may,” or other similar terms. There are a number of factors, many of which are beyond the Company’s control, that could cause actual results to differ materially from those contemplated by 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) local, regional, national and international economic conditions, including actual or potential stress in the banking industry, and the impact they may have on the Company and its customers and the Company’s assessment of that impact; (2) changes in the level of nonperforming assets and charge-offs; (3) changes in estimates of future reserve requirements based upon the periodic review thereof under relevant regulatory and accounting requirements; (4) the effects of and changes in trade and monetary and fiscal policies and laws, including the interest rate policies of the Federal Reserve Board (“FRB”); (5) inflation, interest rate, securities market and monetary fluctuations; (6) political instability; (7) acts of war, including international military conflicts, or terrorism; (8) the timely development and acceptance of new products and services and the perceived overall value of these products and services by users; (9) changes in consumer spending, borrowing and saving habits; (10) changes in the financial performance and/or condition of the Company’s borrowers; (11) technological changes; (12) acquisition and integration of acquired businesses; (13) the possibility that NBT may be unable to achieve expected synergies and operating efficiencies in the merger within the expected timeframes; (14) the ability to increase market share and control expenses; (15) changes in the competitive environment among financial holding companies; (16) the effect of changes in laws and regulations (including laws and regulations concerning taxes, banking, securities and insurance) with which the Company and its subsidiaries must comply, including those under the Dodd-Frank Act, and the Economic Growth, Regulatory Relief, and Consumer Protection Act of 2018; (17) the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board and other accounting standard setters; (18) changes in the Company’s organization, compensation and benefit plans; (19) the costs and effects of legal and regulatory developments, including the resolution of legal proceedings or regulatory or other governmental inquiries, and the results of regulatory examinations or reviews; (20) greater than expected costs or difficulties related to the integration of new products and lines of business; and (21) the Company’s success at managing the risks involved in the foregoing items.

The Company cautions readers not to place undue reliance on any forward-looking statements, which speak only as of the date made, and advises readers that various factors, including, but not limited to, those described above and other factors discussed in the Company’s annual and quarterly reports previously filed with the SEC, could affect the Company’s financial performance and could cause the Company’s actual results or circumstances for future periods to differ materially from those anticipated or projected.

Unless required by law, the Company does not undertake, and specifically disclaims any obligations to, publicly release any revisions that may be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.

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 a reconciliation to the comparable GAAP measure, is provided in the accompanying tables. Management believes that these non-GAAP measures provide useful information that is important to an understanding of the results of the Company’s core business as well as provide information standard in the financial institution industry. Non-GAAP measures should not be considered a substitute for financial measures determined in accordance with GAAP and investors should consider the Company’s performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Amounts previously reported in the consolidated financial statements are reclassified whenever necessary to conform to current period presentation.

           
NBT Bancorp Inc. and Subsidiaries          
Selected Financial Data          
(unaudited, dollars in thousands except per share data)        
           
  2023
2022
  4th Q 3rd Q 2nd Q 1st Q 4th Q
Profitability (reported)          
Diluted earnings per share $ 0.64   $ 0.54   $ 0.70   $ 0.78   $ 0.84  
Weighted average diluted common shares outstanding   47,356,899     45,398,937     43,126,498     43,125,986     43,144,666  
Return on average assets3   0.89 %   0.76 %   1.02 %   1.16 %   1.23 %
Return on average equity3   8.79 %   7.48 %   9.91 %   11.47 %   12.30 %
Return on average tangible common equity1 3   13.08 %   10.73 %   13.13 %   15.31 %   16.54 %
Net interest margin1 3   3.15 %   3.21 %   3.27 %   3.55 %   3.68 %
           
  12 Months Ended December 31,      
    2023     2022        
Profitability (reported)          
Diluted earnings per share $ 2.65   $ 3.52        
Weighted average diluted common shares outstanding   44,770,171     43,181,312        
Return on average assets   0.95 %   1.29 %      
Return on average equity   9.34 %   12.67 %      
Return on average tangible common equity1   13.02 %   16.89 %      
Net interest margin1   3.29 %   3.34 %      
           
    2023     2022  
  4th Q 3rd Q 2nd Q 1st Q 4th Q
Profitability (operating)          
Diluted earnings per share1 $ 0.72   $ 0.84   $ 0.80   $ 0.88   $ 0.86  
Return on average assets1 3   0.99 %   1.19 %   1.17 %   1.31 %   1.26 %
Return on average equity1 3   9.79 %   11.65 %   11.40 %   12.95 %   12.61 %
Return on average tangible common equity1 3   14.49 %   16.43 %   15.08 %   17.27 %   16.95 %
           
  12 Months Ended December 31,      
    2023     2022        
Profitability (operating)          
Diluted earnings per share1 $ 3.23   $ 3.56        
Return on average assets1   1.16 %   1.30 %      
Return on average equity1   11.38 %   12.81 %      
Return on average tangible common equity1   15.78 %   17.06 %      
           
    2023     2022  
  4th Q 3rd Q 2nd Q 1st Q 4th Q
Balance sheet data          
Short-term interest-bearing accounts $ 31,378   $ 459,296   $ 31,878   $ 68,045   $ 30,862  
Securities available for sale   1,430,858     1,399,032     1,453,926     1,512,008     1,527,225  
Securities held to maturity   905,267     914,520     912,876     906,824     919,517  
Net loans   9,536,313     9,552,774     8,257,724     8,164,328     8,049,347  
Total assets   13,309,040     13,827,628     11,890,497     11,839,730     11,739,296  
Total deposits   10,968,994     11,401,452     9,529,919     9,681,205     9,495,933  
Total borrowings   637,387     740,603     880,518     703,248     787,950  
Total liabilities   11,883,349     12,464,807     10,680,004     10,628,071     10,565,742  
Stockholders' equity   1,425,691     1,362,821     1,210,493     1,211,659     1,173,554  
           
Capital          
Equity to assets   10.71 %   9.86 %   10.18 %   10.23 %   10.00 %
Tangible equity ratio1   7.93 %   7.15 %   7.95 %   7.99 %   7.73 %
Book value per share $ 30.26   $ 28.94   $ 28.26   $ 28.24   $ 27.38  
Tangible book value per share2 $ 21.72   $ 20.39   $ 21.55   $ 21.52   $ 20.65  
Leverage ratio   9.71 %   10.23 %   10.51 %   10.43 %   10.32 %
Common equity tier 1 capital ratio   11.57 %   11.31 %   12.29 %   12.28 %   12.12 %
Tier 1 capital ratio   12.50 %   12.23 %   13.35 %   13.34 %   13.19 %
Total risk-based capital ratio   14.75 %   14.45 %   15.50 %   15.53 %   15.38 %
Common stock price (end of period) $ 41.91   $ 31.69   $ 31.85   $ 33.71   $ 43.42  
           


NBT Bancorp Inc. and Subsidiaries          
Asset Quality and Consolidated Loan Balances          
(unaudited, dollars in thousands)          
           
    2023     2022  
  4th Q 3rd Q 2nd Q 1st Q 4th Q
Asset quality          
Nonaccrual loans $ 34,213   $ 20,736   $ 16,931   $ 16,284   $ 17,233  
90 days past due and still accruing   3,661     3,528     2,755     2,328     3,823  
Total nonperforming loans   37,874     24,264     19,686     18,612     21,056  
Other real estate owned   -     -     179     105     105  
Total nonperforming assets   37,874     24,264     19,865     18,717     21,161  
Allowance for loan losses   114,400     114,601     100,400     100,250     100,800  
           
Asset quality ratios          
Allowance for loan losses to total loans   1.19 %   1.19 %   1.20 %   1.21 %   1.24 %
Total nonperforming loans to total loans   0.39 %   0.25 %   0.24 %   0.23 %   0.26 %
Total nonperforming assets to total assets   0.28 %   0.18 %   0.17 %   0.16 %   0.18 %
Allowance for loan losses to total nonperforming loans   302.05 %   472.31 %   510.01 %   538.63 %   478.72 %
Past due loans to total loans4   0.32 %   0.49 %   0.45 %   0.30 %   0.33 %
Net charge-offs to average loans3   0.22 %   0.18 %   0.17 %   0.19 %   0.18 %
           
    2023     2022  
  4th Q 3rd Q 2nd Q 1st Q 4th Q
Loan net charge-offs by line of business          
Commercial $ 1,107   $ (344 ) $ 92   $ (252 ) $ (37 )
Residential real estate and home equity   11     (75 )   (43 )   80     (79 )
Indirect auto   399     451     273     423     445  
Residential solar   1,081     1,253     581     656     596  
Other consumer   2,729     2,919     2,553     2,904     2,752  
Total loan net charge-offs $ 5,327   $ 4,204   $ 3,456   $ 3,811   $ 3,677  
           
    2023     2022  
  4th Q 3rd Q 2nd Q 1st Q 4th Q
Allowance for loan losses as a percentage of loans by segment        
Commercial & industrial   0.84 %   0.87 %   0.86 %   0.85 %   0.82 %
Commercial real estate   0.99 %   1.00 %   0.93 %   0.93 %   0.91 %
Residential real estate   0.84 %   0.79 %   0.73 %   0.73 %   0.72 %
Auto   0.83 %   0.82 %   0.80 %   0.77 %   0.81 %
Residential solar   3.28 %   3.19 %   3.09 %   3.04 %   3.21 %
Other consumer   4.70 %   5.23 %   5.98 %   6.19 %   6.27 %
Total   1.19 %   1.19 %   1.20 %   1.21 %   1.24 %
           
    2023     2022  
  4th Q 3rd Q 2nd Q 1st Q 4th Q
Loans by line of business          
Commercial & industrial $ 1,354,248   $ 1,424,579   $ 1,319,093   $ 1,278,291   $ 1,266,031  
Commercial real estate   3,626,910     3,575,595     2,884,264     2,845,631     2,807,941  
Residential real estate   2,125,804     2,111,670     1,666,204     1,651,918     1,649,870  
Indirect auto   1,130,132     1,099,558     1,048,739     1,031,315     989,587  
Residential solar   917,755     934,082     926,365     920,084     856,798  
Home equity   337,214     340,777     310,897     308,219     314,124  
Other consumer   158,650     181,114     202,562     229,120     265,796  
Total loans $ 9,650,713   $ 9,667,375   $ 8,358,124   $ 8,264,578   $ 8,150,147  
           


NBT Bancorp Inc. and Subsidiaries    
Consolidated Balance Sheets    
(unaudited, dollars in thousands)    
     
  December 31, December 31,
  2023 2022
Assets    
Cash and due from banks $ 173,811 $ 166,488
Short-term interest-bearing accounts   31,378   30,862
Equity securities, at fair value   37,591   30,784
Securities available for sale, at fair value   1,430,858   1,527,225
Securities held to maturity (fair value $814,524 and $812,647, respectively)   905,267   919,517
Federal Reserve and Federal Home Loan Bank stock   45,861   44,713
Loans held for sale   3,371   562
Loans   9,650,713   8,150,147
Less allowance for loan losses   114,400   100,800
Net loans $ 9,536,313 $ 8,049,347
Premises and equipment, net   80,675   69,047
Goodwill   361,851   281,204
Intangible assets, net   40,443   7,341
Bank owned life insurance   265,732   232,409
Other assets   395,889   379,797
Total assets $ 13,309,040 $ 11,739,296
     
Liabilities and stockholders' equity    
Demand (noninterest bearing) $ 3,413,829 $ 3,617,324
Savings, NOW and money market   6,230,456   5,444,837
Time   1,324,709   433,772
Total deposits $ 10,968,994 $ 9,495,933
Short-term borrowings   386,651   585,012
Long-term debt   29,796   4,815
Subordinated debt, net   119,744   96,927
Junior subordinated debt   101,196   101,196
Other liabilities   276,968   281,859
Total liabilities $ 11,883,349 $ 10,565,742
     
Total stockholders' equity $ 1,425,691 $ 1,173,554
     
Total liabilities and stockholders' equity $ 13,309,040 $ 11,739,296
     


NBT Bancorp Inc. and Subsidiaries        
Consolidated Statements of Income        
(unaudited, dollars in thousands except per share data)      
         
  Three Months Ended Twelve Months Ended
  December 31, December 31,
  2023 2022 2023 2022
Interest, fee and dividend income        
Interest and fees on loans $ 132,738 $ 95,620   $ 462,669   $ 332,768  
Securities available for sale   7,208   7,831     29,812     29,653  
Securities held to maturity   5,374   5,050     20,681     17,582  
Other   5,594   671     9,627     4,067  
Total interest, fee and dividend income $ 150,914 $ 109,172   $ 522,789   $ 384,070  
Interest expense        
Deposits $ 42,753 $ 4,092   $ 104,641   $ 9,923  
Short-term borrowings   4,951   2,510     25,608     2,623  
Long-term debt   294   21     925     161  
Subordinated debt   1,795   1,346     6,076     5,424  
Junior subordinated debt   1,948   1,424     7,320     3,749  
Total interest expense $ 51,741 $ 9,393   $ 144,570   $ 21,880  
Net interest income $ 99,173 $ 99,779   $ 378,219   $ 362,190  
Provision for loan losses $ 5,126 $ 7,677   $ 16,524   $ 17,147  
Provision for loan losses - acquisition day 1 non-PCD   -   -     8,750     -  
Total provision for loan losses $ 5,126 $ 7,677   $ 25,274   $ 17,147  
Net interest income after provision for loan losses $ 94,047 $ 92,102   $ 352,945   $ 345,043  
Noninterest income        
Service charges on deposit accounts $ 4,165 $ 3,598   $ 15,425   $ 14,630  
Card services income   5,360   4,958     20,829     29,058  
Retirement plan administration fees   11,226   10,661     47,221     48,112  
Wealth management   9,152   8,017     34,763     33,311  
Insurance services   3,659   3,438     15,667     14,696  
Bank owned life insurance income   1,776   1,419     6,750     6,044  
Net securities gains (losses)   507   (217 )   (9,315 )   (1,131 )
Other   2,643   2,217     10,838     10,858  
Total noninterest income $ 38,488 $ 34,091   $ 142,178   $ 155,578  
Noninterest expense        
Salaries and employee benefits $ 50,013 $ 47,235   $ 194,250   $ 187,830  
Technology and data services   10,174   9,124     38,163     35,712  
Occupancy   7,175   6,521     28,408     26,282  
Professional fees and outside services   5,115   4,811     17,601     16,810  
Office supplies and postage   1,913   1,699     6,917     6,140  
FDIC assessment   1,860   798     6,257     3,197  
Advertising   1,213   879     3,054     2,822  
Amortization of intangible assets   2,131   538     4,734     2,263  
Loan collection and other real estate owned, net   503   957     2,618     2,647  
Reserve for unfunded loan commitments   300   (185 )   30     20  
Impairment of a minority interest equity investment   4,750   -     4,750     -  
Acquisition expenses   254   967     9,978     967  
Other   7,350   6,165     24,904     19,775  
Total noninterest expense $ 92,751 $ 79,509   $ 341,664   $ 304,465  
Income before income tax expense $ 39,784 $ 46,684   $ 153,459   $ 196,156  
Income tax expense   9,338   10,563     34,677     44,161  
Net income $ 30,446 $ 36,121   $ 118,782   $ 151,995  
Earnings Per Share        
Basic $ 0.65 $ 0.84   $ 2.67   $ 3.54  
Diluted $ 0.64 $ 0.84   $ 2.65   $ 3.52  
         


NBT Bancorp Inc. and Subsidiaries          
Quarterly Consolidated Statements of Income          
(unaudited, dollars in thousands except per share data)        
           
    2023     2022  
  4th Q 3rd Q 2nd Q 1st Q 4th Q
Interest, fee and dividend income          
Interest and fees on loans $ 132,738 $ 122,097   $ 106,935   $ 100,899   $ 95,620  
Securities available for sale   7,208   7,495     7,493     7,616     7,831  
Securities held to maturity   5,374   5,281     4,991     5,035     5,050  
Other   5,594   2,221     1,170     642     671  
Total interest, fee and dividend income $ 150,914 $ 137,094   $ 120,589   $ 114,192   $ 109,172  
Interest expense          
Deposits $ 42,753 $ 30,758   $ 19,986   $ 11,144   $ 4,092  
Short-term borrowings   4,951   7,612     8,126     4,919     2,510  
Long-term debt   294   294     290     47     21  
Subordinated debt   1,795   1,612     1,335     1,334     1,346  
Junior subordinated debt   1,948   1,923     1,767     1,682     1,424  
Total interest expense $ 51,741 $ 42,199   $ 31,504   $ 19,126   $ 9,393  
Net interest income $ 99,173 $ 94,895   $ 89,085   $ 95,066   $ 99,779  
Provision for loan losses $ 5,126 $ 3,883   $ 3,606   $ 3,909   $ 7,677  
Provision for loan losses - acquisition day 1 non-PCD   -   8,750     -     -     -  
Total provision for loan losses $ 5,126 $ 12,633   $ 3,606   $ 3,909   $ 7,677  
Net interest income after provision for loan losses $ 94,047 $ 82,262   $ 85,479   $ 91,157   $ 92,102  
Noninterest income          
Service charges on deposit accounts $ 4,165 $ 3,979   $ 3,733   $ 3,548   $ 3,598  
Card services income   5,360   5,503     5,121     4,845     4,958  
Retirement plan administration fees   11,226   12,798     11,735     11,462     10,661  
Wealth management   9,152   9,297     8,227     8,087     8,017  
Insurance services   3,659   4,361     3,716     3,931     3,438  
Bank owned life insurance income   1,776   1,568     1,528     1,878     1,419  
Net securities gains (losses)   507   (183 )   (4,641 )   (4,998 )   (217 )
Other   2,643   2,913     2,626     2,656     2,217  
Total noninterest income $ 38,488 $ 40,236   $ 32,045   $ 31,409   $ 34,091  
Noninterest expense          
Salaries and employee benefits $ 50,013 $ 49,248   $ 46,834   $ 48,155   $ 47,235  
Technology and data services   10,174   9,677     9,305     9,007     9,124  
Occupancy   7,175   7,090     6,923     7,220     6,521  
Professional fees and outside services   5,115   4,149     4,159     4,178     4,811  
Office supplies and postage   1,913   1,700     1,676     1,628     1,699  
FDIC assessment   1,860   1,657     1,344     1,396     798  
Advertising   1,213   667     525     649     879  
Amortization of intangible assets   2,131   1,609     458     536     538  
Loan collection and other real estate owned, net   503   569     691     855     957  
Reserve for unfunded loan commitments   300   460     (100 )   (630 )   (185 )
Impairment of a minority interest equity investment   4,750   -     -     -     -  
Acquisition expenses   254   7,917     1,189     618     967  
Other   7,350   6,054     5,790     5,710     6,165  
Total noninterest expense $ 92,751 $ 90,797   $ 78,794   $ 79,322   $ 79,509  
Income before income tax expense $ 39,784 $ 31,701   $ 38,730   $ 43,244   $ 46,684  
Income tax expense   9,338   7,095     8,658     9,586     10,563  
Net income $ 30,446 $ 24,606   $ 30,072   $ 33,658   $ 36,121  
Earnings Per Share          
Basic $ 0.65 $ 0.54   $ 0.70   $ 0.78   $ 0.84  
Diluted $ 0.64 $ 0.54   $ 0.70   $ 0.78   $ 0.84  
           



NBT Bancorp Inc. and Subsidiaries                      
Average Quarterly Balance Sheets                      
(unaudited, dollars in thousands)                      
                       
    Average
Balance
Yield /
Rates
Average
Balance
Yield /
Rates
Average
Balance
Yield /
Rates
Average
Balance
Yield /
Rates
Average
Balance
Yield /
Rates
    Q4 - 2023 Q3 - 2023 Q2 - 2023 Q1 - 2023 Q4 - 2022
Assets                      
Short-term interest-bearing accounts   $ 319,907 5.59 % $ 121,384 4.26 % $ 28,473 3.62 % $ 34,215 2.26 % $ 39,573 3.31 %
Securities taxable1     2,310,409 1.88 %   2,364,809 1.90 %   2,394,027 1.90 %   2,442,732 1.92 %   2,480,959 1.88 %
Securities tax-exempt 1 5     232,575 3.51 %   219,427 3.34 %   201,499 2.83 %   202,321 2.81 %   208,238 2.68 %
FRB and FHLB stock     47,994 8.98 %   53,841 6.76 %   51,454 7.12 %   41,144 4.45 %   32,903 4.11 %
Loans1 6     9,653,191 5.47 %   9,043,582 5.36 %   8,307,894 5.17 %   8,189,520 5.00 %   8,039,442 4.72 %
Total interest-earning assets   $ 12,564,076 4.79 % $ 11,803,043 4.63 % $ 10,983,347 4.42 % $ 10,909,932 4.26 % $ 10,801,115 4.02 %
Other assets     1,052,024     968,220     835,424     836,879     855,410  
Total assets   $ 13,616,100   $ 12,771,263   $ 11,818,771   $ 11,746,811   $ 11,656,525  
Liabilities and stockholders' equity                      
Money market deposit accounts   $ 3,045,531 3.43 % $ 2,422,451 2.91 % $ 2,113,965 2.30 % $ 2,081,210 1.22 % $ 2,169,192 0.39 %
NOW deposit accounts     1,645,401 0.80 %   1,513,420 0.57 %   1,463,953 0.38 %   1,598,834 0.36 %   1,604,096 0.33 %
Savings deposits     1,666,915 0.04 %   1,707,094 0.04 %   1,708,874 0.03 %   1,781,465 0.03 %   1,823,056 0.03 %
Time deposits     1,343,548 3.81 %   1,178,352 3.60 %   856,305 2.97 %   639,645 2.10 %   432,110 0.41 %
Total interest-bearing deposits   $ 7,701,395 2.20 % $ 6,821,317 1.79 % $ 6,143,097 1.30 % $ 6,101,154 0.74 % $ 6,028,454 0.27 %
Federal funds purchased     217 5.48 %   6,033 5.39 %   48,407 5.35 %   44,334 4.92 %   56,576 4.03 %
Repurchase agreements     82,387 1.59 %   71,516 1.40 %   55,627 1.08 %   71,340 0.08 %   76,334 0.11 %
Short-term borrowings     345,250 5.31 %   540,380 5.34 %   557,818 5.27 %   357,200 4.96 %   177,533 4.28 %
Long-term debt     29,809 3.91 %   29,800 3.91 %   29,773 3.91 %   7,299 2.61 %   3,817 2.18 %
Subordinated debt, net     119,531 5.96 %   109,160 5.86 %   97,081 5.52 %   96,966 5.58 %   97,839 5.46 %
Junior subordinated debt     101,196 7.64 %   101,196 7.54 %   101,196 7.00 %   101,196 6.74 %   101,196 5.58 %
Total interest-bearing liabilities   $ 8,379,785 2.45 % $ 7,679,402 2.18 % $ 7,032,999 1.80 % $ 6,779,489 1.14 % $ 6,541,749 0.57 %
Demand deposits     3,535,815     3,498,424     3,316,955     3,502,489     3,658,965  
Other liabilities     326,857     287,751     251,511     274,517     290,895  
Stockholders' equity     1,373,643     1,305,686     1,217,306     1,190,316     1,164,916  
Total liabilities and stockholders' equity   $ 13,616,100   $ 12,771,263   $ 11,818,771   $ 11,746,811   $ 11,656,525  
Interest rate spread     2.34 %   2.45 %   2.62 %   3.12 %   3.45 %
Net interest margin (FTE)1     3.15 %   3.21 %   3.27 %   3.55 %   3.68 %
                       



NBT Bancorp Inc. and Subsidiaries              
Average Year-to-Date Balance Sheets            
(unaudited, dollars in thousands)              
               
    Average   Yield/ Average   Yield/
    Balance Interest Rates Balance Interest Rates
Twelve Months Ended December 31,   2023 2022
Assets              
Short-term interest-bearing accounts   $ 126,765 $ 6,259 4.94 % $ 440,429 $ 3,072 0.70 %
Securities taxable1     2,377,596   45,176 1.90 %   2,424,925   43,229 1.78 %
Securities tax-exempt1 5     214,053   6,730 3.14 %   233,515   5,070 2.17 %
FRB and FHLB stock     48,641   3,368 6.92 %   27,040   995 3.68 %
Loans1 6     8,803,228   463,290 5.26 %   7,772,962   333,008 4.28 %
Total interest-earning assets   $ 11,570,283 $ 524,823 4.54 % $ 10,898,871 $ 385,374 3.54 %
Other assets     923,850       893,197    
Total assets   $ 12,494,133     $ 11,792,068    
Liabilities and stockholders' equity              
Money market deposit accounts   $ 2,418,450 $ 62,475 2.58 % $ 2,447,978 $ 4,955 0.20 %
NOW deposit accounts     1,555,414   8,298 0.53 %   1,578,831   2,600 0.16 %
Savings deposits     1,715,749   650 0.04 %   1,829,360   592 0.03 %
Time deposits     1,006,867   33,218 3.30 %   464,912   1,776 0.38 %
Total interest-bearing deposits   $ 6,696,480 $ 104,641 1.56 % $ 6,321,081 $ 9,923 0.16 %
Federal funds purchased     24,575   1,269 5.16 %   14,644   588 4.02 %
Repurchase agreements     70,251   747 1.06 %   69,561   67 0.10 %
Short-term borrowings     450,377   23,592 5.24 %   46,371   1,968 4.24 %
Long-term debt     24,247   925 3.81 %   6,579   161 2.45 %
Subordinated debt, net     105,756   6,076 5.75 %   98,439   5,424 5.51 %
Junior subordinated debt     101,196   7,320 7.23 %   101,196   3,749 3.70 %
Total interest-bearing liabilities   $ 7,472,882 $ 144,570 1.93 % $ 6,657,871 $ 21,880 0.33 %
Demand deposits     3,463,608       3,696,957    
Other liabilities     285,310       237,857    
Stockholders' equity     1,272,333       1,199,383    
Total liabilities and stockholders' equity   $ 12,494,133     $ 11,792,068    
Net interest income (FTE)1     $ 380,253     $ 363,494  
Interest rate spread       2.61 %     3.21 %
Net interest margin (FTE)1       3.29 %     3.34 %
Taxable equivalent adjustment     $ 2,034     $ 1,304  
Net interest income     $ 378,219     $ 362,190  
               


             
1 The following tables provide the Non-GAAP reconciliations for the Non-GAAP measures contained in this release:  
             
  Non-GAAP measures          
  (unaudited, dollars in thousands)          
             
    2023 2022
    4th Q 3rd Q 2nd Q 1st Q 4th Q
  Operating net income          
  Net income $ 30,446   $ 24,606   $ 30,072   $ 33,658   $ 36,121  
  Acquisition expenses   254     7,917     1,189     618     967  
  Acquisition-related provision for credit losses   -     8,750     -     -     -  
  Acquisition-related reserve for unfunded loan commitments   -     836     -     -     -  
  Impairment of a minority interest equity investment   4,750     -     -     -     -  
  Securities (gains) losses   (507 )   183     4,641     4,998     217  
  Adjustment to net income $ 4,497   $ 17,686   $ 5,830   $ 5,616   $ 1,184  
  Adjustment to net income (net of tax) $ 3,435   $ 13,730   $ 4,525   $ 4,341   $ 913  
  Operating net income $ 33,881   $ 38,336   $ 34,597   $ 37,999   $ 37,034  
  Operating diluted earnings per share $ 0.72   $ 0.84   $ 0.80   $ 0.88   $ 0.86  
             
    12 Months Ended December 31,      
      2023     2022        
  Operating net income          
  Net income $ 118,782   $ 151,995        
  Acquisition expenses   9,978     967        
  Acquisition-related provision for credit losses   8,750     -        
  Acquisition-related reserve for unfunded loan commitments   836     -        
  Impairment of a minority interest equity investment   4,750     -        
  Securities losses   9,315     1,131        
  Adjustment to net income $ 33,629   $ 2,098        
  Adjustment to net income (net of tax) $ 25,965   $ 1,623        
  Operating net income $ 144,747   $ 153,618        
  Operating diluted earnings per share $ 3.23   $ 3.56        
             
    2023 2022
    4th Q 3rd Q 2nd Q 1st Q 4th Q
  FTE adjustment          
  Net interest income $ 99,173   $ 94,895   $ 89,085   $ 95,066   $ 99,779  
  Add: FTE adjustment   669     568     402     395     392  
  Net interest income (FTE) $ 99,842   $ 95,463   $ 89,487   $ 95,461   $ 100,171  
  Average earning assets $ 12,564,076   $ 11,803,043   $ 10,983,347   $ 10,909,932   $ 10,801,115  
  Net interest margin (FTE)3   3.15 %   3.21 %   3.27 %   3.55 %   3.68 %
             
    12 Months Ended December 31,      
      2023     2022        
  FTE adjustment          
  Net interest income $ 378,219   $ 362,190        
  Add: FTE adjustment   2,034     1,304        
  Net interest income (FTE) $ 380,253   $ 363,494        
  Average earning assets $ 11,570,283   $ 10,898,871        
  Net interest margin (FTE)   3.29 %   3.34 %      
             
  Interest income for tax-exempt securities and loans have been adjusted to an FTE basis using the statutory Federal income tax rate of 21%.


             
1 The following tables provide the Non-GAAP reconciliations for the Non-GAAP measures contained in this release:
             
  Non-GAAP measures (continued)          
  (unaudited, dollars in thousands)          
             
    2023 2022
    4th Q 3rd Q 2nd Q 1st Q 4th Q
  Tangible equity to tangible assets          
  Total equity $ 1,425,691   $ 1,362,821   $ 1,210,493   $ 1,211,659   $ 1,173,554  
  Intangible assets   402,294     402,745     287,701     288,159     288,545  
  Total assets $ 13,309,040   $ 13,827,628   $ 11,890,497   $ 11,839,730   $ 11,739,296  
  Tangible equity to tangible assets   7.93 %   7.15 %   7.95 %   7.99 %   7.73 %
             
    2023 2022
    4th Q 3rd Q 2nd Q 1st Q 4th Q
  Return on average tangible common equity        
  Net income $ 30,446   $ 24,606   $ 30,072   $ 33,658   $ 36,121  
  Amortization of intangible assets (net of tax)   1,599     1,206     344     402     404  
  Net income, excluding intangibles amortization $ 32,045   $ 25,812   $ 30,416   $ 34,060   $ 36,525  
             
  Average stockholders' equity $ 1,373,643   $ 1,305,686   $ 1,217,306   $ 1,190,316   $ 1,164,916  
  Less: average goodwill and other intangibles   401,978     350,912     287,974     288,354     288,856  
  Average tangible common equity $ 971,665   $ 954,774   $ 929,332   $ 901,962   $ 876,060  
  Return on average tangible common equity3   13.08 %   10.73 %   13.13 %   15.31 %   16.54 %
             
    12 Months Ended December 31,      
      2023     2022        
  Return on average tangible common equity        
  Net income $ 118,782   $ 151,995        
  Amortization of intangible assets (net of tax)   3,551     1,698        
  Net income, excluding intangibles amortization $ 122,333   $ 153,693        
             
  Average stockholders' equity $ 1,272,333   $ 1,199,383        
  Less: average goodwill and other intangibles   332,667     289,238        
  Average tangible common equity $ 939,666   $ 910,145        
  Return on average tangible common equity   13.02 %   16.89 %      
             
2 Non-GAAP measure - Stockholders' equity less goodwill and intangible assets divided by common shares outstanding.
3 Annualized.          
4 Total past due loans, defined as loans 30 days or more past due and in an accrual status.    
5 Securities are shown at average amortized cost.        
6 For purposes of these computations, nonaccrual loans and loans held for sale are included in the average loan balances outstanding.


Contact: John H. Watt, Jr., President and CEO
  Scott A. Kingsley, Executive Vice President and CFO
  NBT Bancorp Inc.
  52 South Broad Street
  Norwich, NY 13815
  607-337-6589

NBT Bancorp Inc.

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