Tompkins Financial Corporation Reports Third Quarter Earnings

ITHACA, N.Y.--()--Tompkins Financial Corporation (NYSEMKT:TMP)

Tompkins Financial Corporation reported diluted earnings per share of $0.92 for the third quarter of 2014, a 3.2% decrease from the $0.95 reported for September 30, 2013. The decline from the prior period is the result of non-recurring income that benefited prior period results. Adjusting for non-recurring income and expenses, diluted earnings per share for the third quarter of 2014 would reflect a 3.4% increase over the adjusted diluted earnings per share of $0.89 reported for the third quarter of 2013. Refer to the non-GAAP disclosure tables included in this press release for additional information on non-recurring adjustments to earnings per share.

President and CEO Stephen S. Romaine said, “Our core earnings performance, after adjusting for non-recurring items, reflects the best quarter in our history. Growth in several key business areas contributed to this success as we saw growth in loan and deposit balances, while fee based income improved for both the quarter and year-to-date periods.”

For the year-to-date period ended September 30, 2014, diluted earnings per share were $2.64, up 5.6% over the $2.50 per share reported for the same period last year. Prior period year-to-date results were also impacted by non-recurring items as disclosed in the non-GAAP disclosure tables included in this press release. After adjusting for non-recurring income and expenses, year-to-date diluted earnings per share for 2014 reflect a 7.8% increase over the adjusted diluted earnings per share of $2.45 for the nine months ended September 30, 2013.

SELECTED HIGHLIGHTS FOR THIRD QUARTER:

  • Credit quality remains strong and continued to improve. Nonperforming assets at September 30, 2014, are down 4.3% from the most recent prior quarter and have declined 35.2% from the same period last year.
  • Loans are up 4.4% over the last 12 months and are up 0.9% over the most recent quarter.
  • Noninterest bearing deposits were up 14.6% over the last 12 months and are up 7.5% during the most recent quarter.
  • Provision for loan losses was a credit of $59,000 for the third quarter of 2014, as asset quality continued to improve and recoveries of previously charged off loans exceeded net losses.
  • Fee based income from insurance, investment services, deposit service charges and card services were up a combined 5.1% over the last 12 months and most recent quarter.
  • Tangible book value per share has increased for the fifth consecutive quarter and is up 13.5% from the third quarter of 2013. Refer to Non-GAAP disclosure for additional details on tangible book value per share.

NET INTEREST INCOME

Net interest income was $41.6 million for the third quarter of 2014, an increase of 2.6% and 2.7%, respectively over June 30, 2014 and September 30, 2013. Year-to-date net interest income of $122.1 million was up 3.1% compared to net interest income of $118.5 million reported for the same period in 2013, mainly a result of loan growth and lower interest expense on interest bearing deposits. The net interest margin for the third quarter of 2014 was 3.58%, compared to 3.63% for the same period in 2013.

NONINTEREST INCOME

Noninterest income was $17.6 million for the third quarter of 2014, down 5.3% compared to September 30, 2013. Year-to-date noninterest income of $52.7 million was in line with same period last year. Both the three and nine month periods in 2013 included pre-tax gains on the redemption of trust preferred securities of $1.4 million.

Noninterest income represented 29.7% of total revenue for the third quarter of 2014, compared to 31.4% for the same period in 2013. Insurance revenues, deposit fees and card service fees were all up compared to September 30, 2013, while fees related to investment services were down 1.6% compared to the same period prior year.

NONINTEREST EXPENSE

Noninterest expense was $38.5 million for the third quarter of 2014, up 2.6% compared to the third quarter of 2013. For the year-to-date period, noninterest expense was up 2.5% from the same period in 2013. The increase in noninterest expense compared to the same period prior year is mainly due to increased salaries and higher amortization of the FDIC indemnification asset as a result of better than expected performance on FDIC covered loans.

ASSET QUALITY

Asset quality trends show continued improvement in the third quarter of 2014. Substandard and Special Mention loans were $85.4 million at September 30, 2014, down from $99.1 million at the most recent prior quarter end and $146.4 million at the same quarter end last year. The percentage of nonperforming loans and leases to total loans and leases improved to 0.78% at September 30, 2014, compared to 1.38% reported at September 30, 2013. The percentage of nonperforming assets to total assets improved to 0.63%, which is the lowest this percentage has been over the past 22 quarters and remains well below the most recent peer average of 1.47% reported by the Federal Reserve1.

Provision for loan and lease losses was a credit of $59,000 for the third quarter of 2014, down from $2.0 million reported in the third quarter of 2013. Net loan and lease recoveries totaled $328,000 in the third quarter of 2014, compared to net loan and lease charge offs of $1.1 million reported in the third quarter of 2013.

The Company's allowance for originated loan and lease losses totaled $27.2 million at September 30, 2014, which represented 1.02% of total originated loans, compared to $25.7 million or 1.06% at September 30, 2013 and $26.8 million or 1.02% at June 30, 2014. The increase in the allowance when compared to the same period last year was mainly a result of loan growth and was partially offset by improved asset quality. The allowance for loan and lease losses covered 108.9% of nonperforming loans and leases as of September 30, 2014, up from 61.2% at September 30, 2013 and 103.1% at the most recent prior quarter.

CAPITAL POSITION

Capital ratios remain well above the regulatory well capitalized minimums. Tier 1 capital to average assets improved for the seventh consecutive quarter to 8.85% at September 30, 2014, and the ratio of total capital to risk-weighted assets was 13.92%, up from 13.32% at September 30, 2013.

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.

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 accompanying tables. Management believes that these non-GAAP measures provide useful information. 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. See “Tompkins Financial Corporation - Summary Financial Data (Unaudited)” tables for Non-GAAP related calculations.

"Safe Harbor" Statement under the Private Securities Litigation Reform of 1995:

This press release may include forward-looking statements with respect to revenue sources, growth, market risk, and corporate objectives. The Company assumes no duty, and specifically disclaims any obligation, to update forward-looking statements, and cautions that these statements are subject to numerous assumptions, risks, and uncertainties, all of which could change over time. Actual results could differ materially from forward-looking statements.

   
TOMPKINS FINANCIAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION
 
(In thousands, except share and per share data) (Unaudited) As of As of
ASSETS 09/30/2014 12/31/2013
 
Cash and noninterest bearing balances due from banks $ 84,129 $ 82,163
Interest bearing balances due from banks     988       721  
Cash and Cash Equivalents 85,117 82,884
 
Trading securities, at fair value 9,473 10,991

Available-for-sale securities, at fair value (amortized cost of $1,375,637 at September 30,

2014 and $1,368,736 at December 31, 2013) 1,374,756 1,354,811
Held-to-maturity securities, at amortized cost (fair value of $48,017 at September 30, 2014
and $19,625 at December 31, 2013) 47,608 18,980
Originated loans and leases, net of unearned income and deferred costs and fees 2,674,971 2,527,244
Acquired loans and leases, covered 20,910 25,868
Acquired loans and leases, non-covered 561,588 641,172
Less: Allowance for loan and lease losses     27,786       27,970  
Net Loans and Leases 3,229,683 3,166,314
 
FDIC indemnification asset 2,298 4,790
Federal Home Loan Bank stock 14,838 25,041
Bank premises and equipment, net 59,550 55,932
Corporate owned life insurance 73,269 69,335
Goodwill 92,243 92,140
Other intangible assets, net 15,206 16,298
Accrued interest and other assets     86,878       105,523  
Total Assets   $ 5,090,919     $ 5,003,039  
 
LIABILITIES
Deposits:
Interest bearing:
Checking, savings and money market 2,310,629 2,190,616
Time 930,796 865,702
Noninterest bearing     971,435       890,898  
Total Deposits 4,212,860 3,947,216
 
Federal funds purchased and securities sold under agreements to repurchase 128,368 167,724
Other borrowings, including certain amounts at fair value of $11,032 at September 30, 2014
and $11,292 at December 31, 2013 166,509 331,531
Trust preferred debentures 37,298 37,169
Other liabilities     55,273       61,460  
Total Liabilities   $ 4,600,308     $ 4,545,100  
 
EQUITY
Tompkins Financial Corporation shareholders' equity:
Common Stock - par value $.10 per share: Authorized 25,000,000 shares; Issued:
14,830,002 at September 30, 2014; and 14,785,007 at December 31, 2013 1,483 1,479
Additional paid-in capital 348,992 346,096
Retained earnings 158,673 137,102
Accumulated other comprehensive loss (16,810 ) (25,119 )
Treasury stock, at cost – 108,788 shares at September 30, 2014, and 105,449 shares
at December 31, 2013 (3,277 ) (3,071 )
 
Total Tompkins Financial Corporation Shareholders’ Equity 489,061 456,487
Noncontrolling interests     1,550       1,452  
Total Equity   $ 490,611     $ 457,939  
Total Liabilities and Equity   $ 5,090,919     $ 5,003,039  
See notes to consolidated financial statements
 
 
TOMPKINS FINANCIAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
  Three Months Ended   Nine Months Ended
(In thousands, except per share data) (Unaudited) 09/30/2014   09/30/2013 09/30/2014   09/30/2013
INTEREST AND DIVIDEND INCOME
Loans $ 38,298 $ 38,048 $ 112,601 $ 112,027
Due from banks 0 1 2 9
Trading securities 102 147 321 472
Available-for-sale securities 7,718 7,830 23,637 23,222
Held-to-maturity securities 288 160 626 528
Federal Home Loan Bank stock and Federal Reserve Bank stock     212       193       616       538  
Total Interest and Dividend Income     46,618       46,379       137,803       136,796  
INTEREST EXPENSE
Time certificates of deposits of $100,000 or more 996 1,208 2,900 3,651
Other deposits 1,830 1,894 5,446 6,093
Federal funds purchased and securities sold under agreements to
repurchase 683 901 2,263 2,877
Trust preferred debentures 573 660 1,714 2,037
Other borrowings     961       1,243       3,362       3,634  
Total Interest Expense     5,043       5,906       15,685       18,292  
Net Interest Income     41,575       40,473       122,118       118,504  
Less: (Credit) Provision for loan and lease losses     (59 )     2,049       751       5,576  
Net Interest Income After Provision for Loan and Lease Losses     41,634       38,424       121,367       112,928  
NONINTEREST INCOME
Insurance commissions and fees 7,520 7,160 21,823 21,588
Investment services income 3,636 3,694 11,549 11,180
Service charges on deposit accounts 2,506 2,254 7,010 6,186
Card services income 1,936 1,735 5,968 5,163
Mark-to-market loss on trading securities (87 ) (87 ) (181 ) (472 )
Mark-to-market gain on liabilities held at fair value 132 119 260 543
Other income 1,892 3,372 6,129 7,548
Gain on sale of available-for-sale securities     20       281       151       723  
Total Noninterest Income     17,555       18,528       52,709       52,459  
NONINTEREST EXPENSES
Salaries and wages 17,553 16,755 51,859 48,618
Pension and other employee benefits 4,941 5,606 15,964 17,014
Net occupancy expense of premises 2,969 2,850 9,296 8,865
Furniture and fixture expense 1,451 1,448 4,247 4,367
FDIC insurance 682 808 2,228 2,401
Amortization of intangible assets 518 544 1,570 1,648
Merger related expenses 0 0 0 228
Other operating expense     10,423       9,543       30,511       29,710  
Total Noninterest Expenses     38,537       37,554       115,675       112,851  
Income Before Income Tax Expense     20,652       19,398       58,401       52,536  
Income Tax Expense     6,897       5,316       18,951       15,873  
Net Income attributable to Noncontrolling Interests and Tompkins Financial Corporation     13,755       14,082       39,450       36,663  
Less: Net income attributable to noncontrolling interests     33       33       98       98  
Net Income Attributable to Tompkins Financial Corporation   $ 13,722     $ 14,049     $ 39,352     $ 36,565  
Basic Earnings Per Share $ 0.92 $ 0.96 $ 2.65 $ 2.51
Diluted Earnings Per Share   $ 0.92     $ 0.95     $ 2.64     $ 2.50  
See notes to consolidated financial statements
 
 
Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited)
                 
Quarter Ended Year to Date Period Ended Year to Date Period Ended
      September 30, 2014     September 30, 2014     September 30, 2013
Average Average Average
Balance Average Balance Average Balance Average
(Dollar amounts in thousands)     (QTD)     Interest   Yield/Rate     (YTD)     Interest   Yield/Rate     (YTD)     Interest   Yield/Rate
ASSETS
Interest-earning assets
Interest-bearing balances due from banks $ 579 $ - 0.22 % $ 782 $ 2 0.34 % $ 2,261 $ 9 0.53 %
Securities (4)
U.S. Government securities 1,310,291 7,286 2.21 % 1,304,141 22,163 2.27 % 1,334,735 21,269 2.13 %
Trading securities 9,823 102 4.12 % 10,327 321 4.16 % 15,141 472 4.17 %
State and municipal (5) 110,819 1,030 3.69 % 96,992 3,157 4.35 % 97,253 3,750 5.16 %
Other securities (5) 4,259     32     2.98 %     4,571     107     3.13 %     7,996     210     3.51 %
Total securities 1,435,192 8,450 2.34 % 1,416,031 25,748 2.43 % 1,455,125 25,701 2.36 %
FHLBNY and FRB stock 19,252 212 4.37 % 20,192 616 4.08 % 22,051 538 3.26 %
 
Total loans and leases, net of unearned income (5)(6) 3,240,837     38,765     4.74 %     3,218,371     113,924     4.73 %     3,025,846     113,440     5.01 %
Total interest-earning assets 4,695,860     47,427     4.01 %     4,655,376     140,290     4.03 %     4,505,283     139,688     4.15 %
 
Other assets 362,748 368,584 415,809
 
Total assets 5,058,608 5,023,960 4,921,092
                                                 
LIABILITIES & EQUITY
Deposits
Interest-bearing deposits
Interest bearing checking, savings, & money market 2,252,622 1,066 0.19 % 2,265,787 3,276 0.19 % 2,224,540 3,816 0.23 %
Time deposits 913,501     1,760     0.76 %     901,283     5,070     0.75 %     955,284     5,928     0.83 %
Total interest-bearing deposits 3,166,123 2,826 0.35 % 3,167,070 8,346 0.35 % 3,179,824 9,744 0.41 %
 
Federal funds purchased & securities sold under
agreements to repurchase 135,647 683 1.99 % 147,775 2,263 2.05 % 180,939 2,877 2.13 %
Other borrowings 248,633 961 1.53 % 258,578 3,362 1.74 % 211,828 3,634 2.29 %
Trust preferred debentures 37,270     573     6.10 %     37,227     1,714     6.16 %     43,160     2,037     6.31 %
Total interest-bearing liabilities 3,587,673 5,043 0.56 % 3,610,650 15,685 0.58 % 3,615,751 18,292 0.68 %
 
Noninterest bearing deposits 925,986 879,691 790,557
Accrued expenses and other liabilities 55,029 54,040 73,201
Total liabilities 4,568,688 4,544,381 4,479,509
 
Tompkins Financial Corporation Shareholders’ equity 488,386 478,078 440,082
Noncontrolling interest 1,534 1,501 1,501
Total equity 489,920 479,579 441,583
 
Total liabilities and equity $ 5,058,608 $ 5,023,960 $ 4,921,092
Interest rate spread     3.45 %     3.45 %     3.47 %
Net interest income/margin on earning assets 42,384 3.58 % 124,605 3.58 % 121,396 3.60 %
 
Tax Equivalent Adjustment (809 ) (2,487 ) (2,892 )

Net interest income per consolidated financial

statements

        $ 41,575               $ 122,118               $ 118,504      
 
 
Tompkins Financial Corporation - Summary Financial Data (Unaudited)
                                   
(In thousands, except per share data)   Quarter-Ended   Year-Ended
  Sep-14     Jun-14     Mar-14     Dec-13     Sep-13     Dec-13
         
Period End Balance Sheet                                    
Securities   $ 1,431,837     $ 1,420,226     $ 1,408,918     $ 1,384,782     $ 1,390,233     $ 1,384,782  

Originated loans and leases, net of unearned income
and deferred costs and fees (2)

    2,674,971       2,610,289       2,555,522       2,527,244       2,420,695       2,527,244  
Acquired loans and leases (3)     582,498       618,679       648,690       667,040       698,617       667,040  
Allowance for loan and lease losses     27,786       27,517       28,014       27,970       26,408       27,970  
Total assets     5,090,919       5,057,821       5,041,800       5,003,039       4,932,428       5,003,039  
Total deposits     4,212,860       4,044,389       4,105,170       3,947,216       3,972,756       3,947,216  

Federal funds purchased and securities sold under
agreements to repurchase

    128,368       144,796       158,794       167,724       162,117       167,724  
Other borrowings     166,509       287,158       214,616       331,531       242,177       331,531  
Trust preferred debentures     37,298       37,254       37,211       37,169       37,127       37,169  
Shareholders' equity     490,611       489,237       473,822       457,939       444,276       457,939  
 
Average Balance Sheet                                    
Average earning assets   $ 4,695,860     $ 4,666,722     $ 4,602,517     $ 4,571,099     $ 4,533,603     $ 4,521,873  
Average assets     5,058,608       5,030,395       4,982,033       4,950,476       4,897,678       4,928,499  
Average interest-bearing liabilities     3,587,673       3,620,130       3,624,555       3,574,803       3,572,708       3,605,430  
Average equity     489,920       480,063       468,515       449,445       434,482       443,565  
 
Share data                                    
Weighted average shares outstanding (basic)     14,711,709       14,709,881       14,644,548       14,589,120       14,515,053       14,477,617  
Weighted average shares outstanding (diluted)     14,795,343       14,821,191       14,775,386       14,731,786       14,622,512       14,573,919  
Period-end shares outstanding     14,794,092       14,853,439       14,829,007       14,749,097       14,692,671       14,749,097  
Book value per share   $ 33.16     $ 32.94     $ 31.95     $ 31.05     $ 30.24     $ 31.05  
Tangible book value per share (Non-GAAP)   $ 25.90     $ 25.68     $ 24.65     $ 23.70     $ 22.82     $ 23.70  
 
Income Statement                                    
Net interest income   $ 41,575     $ 40,516     $ 40,027     $ 42,624     $ 40,473     $ 161,129  
(Credit) Provision for loan/lease losses     (59 )     67       743       585       2,049       6,161  
Noninterest income     17,555       17,720       17,434       17,439       18,528       69,898  
Noninterest expense     38,537       38,928       38,210       40,251       37,554       153,102  
Income tax expense     6,897       6,148       5,906       4,905       5,316       20,777  

Net income attributable to Tompkins Financial
Corporation

    13,722       13,061       12,569       14,290       14,049       50,856  
Noncontrolling interests     33       32       33       32       33       131  
Basic earnings per share (9)   $ 0.92     $ 0.88     $ 0.85     $ 0.97     $ 0.96     $ 3.48  
Diluted earnings per share (9)   $ 0.92     $ 0.87     $ 0.84     $ 0.96     $ 0.95     $ 3.46  
 
Nonperforming Assets                                    
Originated nonaccrual loans and leases   $ 16,319     $ 16,918     $ 26,974     $ 29,875     $ 33,881     $ 29,875  
Acquired nonaccrual loans and leases     4,998       5,907       6,936       8,508       8,008       8,508  

Originated loans and leases 90 days past due and
accruing

    395       543       339       607       1,217       607  
Troubled debt restructurings not included above     3,800       3,327       1,266       45       46       45  
Total nonperforming loans and leases     25,512       26,695       35,515       39,035       43,152       39,035  
OREO (8)     6,533       6,795       5,351       4,253       6,264       4,253  
Total nonperforming assets   $ 32,045     $ 33,490     $ 40,866     $ 43,288     $ 49,416     $ 43,288  
 
 
 

Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued

  Quarter-Ended   Year-Ended
Delinquency - Originated loan and lease portfolio     Sep-14     Jun-14     Mar-14     Dec-13     Sep-13     Dec-13
Loans and leases 30-89 days past due and                                    
accruing (2)   $ 3,811     $ 5,221     $ 5,660     $ 5,762     $ 12,193     $ 5,762  
Loans and leases 90 days past due and accruing (2)     395       543       339       607       1,217       607  

Total originated loans and leases past due and
accruing (2)

    4,206       5,764       5,999       6,369       13,410       6,369  
 
Delinquency - Acquired loan and lease portfolio

Covered loans and leases 30-89 days past due and
accruing (3)(7)

  $ 0     $ 0     $ 635     $ 0     $ 1,132     $ 0  

Covered loans and leases 90 days or more past

                                   
due and accruing (3)(7)     1,149       904       1,135       2,416       2,980       2,416  
Non-covered loans and leases 30-89 days past                                    
due and accruing (3)(7)     736       1,620       2,293       1,532       6,887       1,532  
Non-covered loans and leases 90 days past                                    
due and accruing (3)(7)     3,171       3,048       3,746       4,557       10,521       4,557  
Total acquired loans and leases past due and accruing     5,056       5,572       7,809       8,505       21,520       8,505  
                                     
Total loans and leases past due and accruing   $ 9,262     $ 11,336     $ 13,808     $ 14,874     $ 34,930     $ 14,874  
 
Allowance for Loan Losses - Originated loan and lease portfolio
Balance at beginning of period   $ 26,752     $ 26,661     $ 26,700     $ 25,722     $ 24,853     $ 24,643  
(Credit) Provision for loan and lease losses     (264 )     (56 )     511       (325 )     1,499       1,000  
Net loan and lease (recoveries) charge-offs     (697 )     (147 )     550       (1,303 )     630       (1,057 )
Allowance for loan and lease losses (originated 27,185   26,752   26,661   26,700   25,722   26,700  
loan portfolio) - balance at end of period   $   $   $   $   $   $
 
Allowance for Loan Losses - Acquired loan and lease portfolio
Balance at beginning of period   $ 765     $ 1,353     $ 1,270     $ 686     $ 605     $ 0  
Provision for loan and lease losses     205       123       232       910       549       5,161  
Net loan and lease charge-offs     369       711       149       326       468       3,891  
Allowance for loan and lease losses (acquired                                    
loan portfolio) - balance at end of period     601       765       1,353       1270       686       1,270  
                                     
Total allowance for loan and lease losses   $ 27,786     $ 27,517     $ 28,014     $ 27,970     $ 26,408     $ 27,970  
 
Loan Classification - Originated Portfolio                                    
Special Mention   $ 27,854     $ 35,484     $ 44,725     $ 42,365     $ 42,975     $ 42,365  
Substandard     25,889       21,253       32,917       35,022       37,004       35,022  
Loan Classification - Acquired Portfolio                                    
Special Mention     7,605       12,124       14,936       17,322       23,939       17,322  
Substandard     24,034       30,273       34,137       33,561       42,433       33,561  
Loan Classifications - Total Portfolio                                    
Special Mention     35,459       47,608       59,661       59,687       66,914       59,687  
Substandard     49,923       51,526       67,054       68,583       79,437       68,583  
 
 
 
Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued
                                 
RATIO ANALYSIS   Quarter-Ended   Year-Ended
Credit Quality     Sep-14     Jun-14     Mar-14     Dec-13     Sep-13     Dec-13
Nonperforming loans and leases/total loans and leases (7)     0.78 %     0.83 %     1.11 %     1.22 %     1.38 %     1.22 %
Nonperforming assets/total assets     0.63 %     0.66 %     0.81 %     0.87 %     1.00 %     0.87 %

Allowance for originated loan and lease losses/total
originated loans and leases

    1.02 %     1.02 %     1.04 %     1.06 %     1.06 %     1.06 %
Allowance/nonperforming loans and leases     108.91 %     103.08 %     78.88 %     71.65 %     61.20 %     71.65 %

Net loan and lease losses (recoveries) annualized/total
average loans and leases

    (0.04 %)     0.07 %     0.09 %     (0.12 %)     0.14 %     0.09 %
 
Capital Adequacy (period-end)                                    
Tier 1 capital / average assets     8.85 %     8.79 %     8.68 %     8.52 %     8.37 %     8.52 %
Total capital / risk-weighted assets     13.92 %     13.92 %     13.67 %     13.42 %     13.32 %     13.42 %
Tangible common equity / tangible assets     7.69 %     7.68 %     7.38 %     7.11 %     6.92 %     7.11 %
 
Profitability                                    
Return on average assets *     1.08 %     1.04 %     1.02 %     1.15 %     1.10 %     1.03 %
Return on average equity *     11.11 %     10.91 %     10.88 %     12.62 %     12.83 %     11.47 %
Net interest margin (TE) *     3.58 %     3.55 %     3.60 %     3.78 %     3.63 %     3.65 %
* Quarterly ratios have been annualized
 
Non-GAAP Disclosure                                    
Reported noninterest income (GAAP)   $ 17,555     $ 17,720     $ 17,434     $ 17,439     $ 18,528     $ 69,898  
Adjustments (pre-tax):                                    
Gain on redemption of trust preferred     0       0       0       0       (1,410 )     (1,410 )
Gain on deposit conversion     0       0       0       (1,285 )     0       (1,285 )
Noninterest income (Non-GAAP)     17,555       17,720       17,434       16,154       17,118       68,613  
 
Non-GAAP Disclosure                                    
Reported net income (GAAP)   $ 13,722     $ 13,061     $ 12,569     $ 14,290     $ 14,049     $ 50,856  
Adjustments (net of tax):                                    
Merger related expenses     0       0       0       0       0       140  
Gain on redemption of trust preferred     0       0       0       0       (846 )     (846 )
Gain on deposit conversion     0       0       0       (771 )     0       (771 )
Subtotal adjustments     0       0       0       (771 )     (846 )     (1,477 )
Net operating income (Non-GAAP)     13,722       13,061       12,569       13,519       13,203       49,379  
Adjusted diluted earnings per share (Non-GAAP) (9)   $ 0.92     $ 0.87     $ 0.84     $ 0.91     $ 0.89     $ 3.36  
 
 
 

Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued

                                 
Non-GAAP Disclosure   Quarter-Ended   Year-Ended
      Sep-14     Jun-14     Mar-14     Dec-13     Sep-13     Dec-13
Reported net income (GAAP)   $ 13,722     $ 13,061     $ 12,569     $ 14,290     $ 14,049     $ 50,856  
Merger related expenses (net of tax)     0       0       0       0       0       140  
Gain on redemption of trust preferred (net of tax)     0       0       0       0       (846 )     (846 )
Gain on deposit conversion     0       0       0       (771 )     0       (771 )
Net operating income (Non-GAAP)     13,722       13,061       12,569       13,519       13,203       49,379  
Amortization of intangibles (net of tax)     311       315       316       329       327       1,318  
Adjusted net operating income (Non-GAAP)     14,033       13,376       12,885       13,848       13,530       50,697  
                                     
Average total shareholders' equity   $ 489,920     $ 480,063     $ 468,515     $ 449,445     $ 434,482     $ 443,565  
Less: Average goodwill and intangibles     107,525       108,019       108,437       108,729       109,277       109,676  
Average tangible shareholders' equity (Non-GAAP)     382,395       372,044       360,078       340,716       325,205       333,889  
                                     

Adjusted operating return on shareholders' tangible
equity (annualized) (Non-GAAP)

    14.56 %     14.42 %     14.51 %     16.13 %     16.51 %     15.18 %
 
 
Non-GAAP Disclosure          
Total shareholders' equity (GAAP)   $ 490,611     $ 489,237     $ 473,822     $ 457,939     $ 444,276     $ 457,939  
Less: Goodwill and intangibles     107,449       107,728       108,250       108,438       108,981       108,438  
Tangible shareholders' equity     383,162       381,509       365,572       349,501       335,295       349,501  
                                     
Ending shares outstanding     14,794,092       14,853,439       14,829,007       14,749,097       14,692,671       14,749,097  
Tangible book value per share (Non-GAAP)   $ 25.90     $ 25.68     $ 24.65     $ 23.70     $ 22.82     $ 23.70  
 
             
Non-GAAP Disclosure   Year-to-date period ended
    Sep-14   Sep-13
Net income attributable to Tompkins Financial         $  
Corporation   $ 39,352     $ 36,565  
Adjustments (net of tax):            
Merger related expenses     0       140  
Gain on redemption of trust preferred securities     0       (846 )
Subtotal adjustments     0       (706 )
Net operating income (Non-GAAP)   $ 39,352     $ 35,859  
Adjusted diluted earnings per share   $ 2.64     $ 2.45  

 

 
(1) Federal Reserve peer ratio as of June 30, 2014, includes banks and bank holding companies with consolidated assets between $3 billion and $10 billion.

(2) "Originated" equals loans and leases not included by definition in "acquired loans".

(3)"Acquired Loans and Leases" equals loans and leases acquired at fair value, accounted for in accordance with FASB ASC Topic 805. "Covered Loans" are loans for which the Company will share losses with the FDIC and consist of loans VIST Bank acquired as part of an FDIC-assisted transaction during the fourth quarter of 2010.
(4) Average balances and yields on available-for-sale securities are based on historical amortized cost.
(5) Interest income includes the tax effects of taxable-equivalent basis.
(6) 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, 2013.
(7) 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 Corporation's estimate of acquisition-date fair value and these loans are considered accruing as the Corporation primarily recognizes interest income through accretion of the difference between the carrying value of these loans and their expected cash flows.
(8) Includes all other real estate owned, including those balances acquired through business combinations.
(9)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.
 

Contacts

Tompkins Financial Corporation
Stephen S. Romaine, 888-503-5753
President & CEO
or
Francis M. Fetsko, 888-503-5753
Executive VP, CFO & COO

Contacts

Tompkins Financial Corporation
Stephen S. Romaine, 888-503-5753
President & CEO
or
Francis M. Fetsko, 888-503-5753
Executive VP, CFO & COO