NBT Bancorp (NBTB) - 2024 Q1 - Quarterly Report

Financial Performance - Net income for Q1 2024 was $33.8 million, or$ 0.71 per diluted share, an increase of $3.4 million from Q4 2023 and a slight increase from$ 33.7 million in Q1 2023[116] - Net income for Q1 2024 was $33.8 million, comparable to Q1 2023, and up$ 3.4 million from Q4 2023[118] - Diluted earnings per share for Q1 2024 were $0.71, down$ 0.07 from Q1 2023, and up $0.07 from Q4 2023[118] - Operating net income for Q1 2024 was$ 32.1 million, or $0.68 per diluted share, compared to$ 0.88 in Q1 2023 and $0.72 in Q4 2023[120] - Noninterest income for Q1 2024 was$ 43.2 million, up $5.2 million, or 13.8%, from Q4 2023, and up$ 6.8 million, or 18.7%, from Q1 2023[118] - Total noninterest income for Q1 2024 was $45.4 million, an increase of$ 6.9 million, or 17.9%, from the prior quarter and up $14.0 million, or 44.5%, from Q1 2023[130] Asset and Liability Management - Total loans at the end of Q1 2024 were$ 9.69 billion, up $37.4 million, or 1.6%, annualized from December 31, 2023[118] - Total deposits at the end of Q1 2024 were$ 11.20 billion, up $226.3 million, or 2.1%, from December 31, 2023[118] - Total assets as of March 31, 2024, were$ 13.329 billion, down from $13.616 billion at the end of 2023[125] - The Company’s stockholders' equity increased to$ 1.430 billion as of March 31, 2024, from $1.374 billion at the end of 2023[125] - Average deposits rose by$ 1.44 billion, or 15.0%, from the same period last year, largely due to $1.31 billion in deposits acquired from Salisbury in Q3 2023[156] Capital Ratios and Equity - The common equity tier 1 capital ratio stood at 11.68% in Q1 2024, compared to 11.57% in Q4 2023[117] - The tangible equity ratio was reported at 7.98% in Q1 2024, up from 7.93% in Q4 2023[117] - The total risk-based capital ratio was 14.87% as of March 31, 2024, compared to 14.75% in the previous quarter and 15.52% a year ago[119] - Stockholders' equity increased by$ 15.7 million to $1.44 billion at March 31, 2024, representing 10.73% of total assets[162] - The Tier 1 leverage ratio was 10.09% at March 31, 2024, compared to 9.71% at December 31, 2023[165] Credit Quality and Allowance for Losses - The allowance for credit losses totaled$ 115.3 million at March 31, 2024, compared to $100.3 million at March 31, 2023, reflecting an increase due to acquired Salisbury loans[148] - The provision for loan losses in Q1 2024 was$ 5.6 million, compared to $3.9 million in Q1 2023 and$ 5.1 million in Q4 2023[118] - The allowance for credit losses as a percentage of loans was 1.19% at March 31, 2024, compared to 1.21% at March 31, 2023[148] - Net charge-offs totaled $4.7 million during Q1 2024, compared to$ 3.8 million in Q1 2023[150] - Total nonperforming assets were $37.8 million at March 31, 2024, compared to$ 37.9 million at December 31, 2023, and $18.7 million at March 31, 2023[153] Interest Income and Margin - The net interest margin (FTE) for Q1 2024 was 3.14%, slightly down from 3.15% in Q4 2023[117] - Net interest income for Q1 2024 was$ 95.2 million, down $4.0 million, or 4.0%, from Q4 2023, and up$ 0.1 million, or 0.1%, from Q1 2023[122] - The interest rate spread for Q1 2024 was 2.32%, compared to 2.34% in Q4 2023 and 3.12% in Q1 2023[125] - The Company recognized a gain of $2.3 million from the sale of a previously written-off subordinated debt security in Q1 2024[130] Economic Outlook and Projections - The Company anticipates a Northeast GDP annualized growth starting at approximately 3.3% in Q2 2024, decreasing to 2.8% before increasing to 3.4% by the end of the forecast period[111] - The Company has a downside scenario where national unemployment could peak at 7.7% by Q2 2025, impacting the allowance for credit losses significantly[111] - The effective tax rate for Q1 2024 was 21.7%, down from 22.2% in Q1 2023, due to a higher level of tax-exempt income[132] - The trajectory of net interest income is significantly influenced by inflationary pressures and FOMC monetary policy, with a total increase of 425 bps in 2022 and an additional 100 bps in 2023[174] Liquidity Management - The Company has a remaining available borrowing capacity of$ 3.13 billion as of March 31, 2024, compared to $2.99 billion at December 31, 2023[178] - The Company continues to monitor liquidity closely due to potential adverse impacts from rising interest rates and increased competition for deposits[179] - The Company has the ability to issue brokered time deposits and borrow against established facilities, providing additional liquidity of$ 2.03 billion as of March 31, 2024[178] - Approximately $77.1 million of the Bank's total stockholders' equity is available for payment of dividends to the Company without OCC approval as of March 31, 2024[182]