NBT Bancorp (US:NBTB)2020-08-10 20:10Financial Performance - Net income for the second quarter of 2020 was $31.3 million, a decrease of $5.8 million compared to the second quarter of 2019[166]. - Net income for Q2 2020 was $24.7 million, up 37.5% from $10.4 million in Q1 2020, but down 19% from $30.6 million in Q2 2019[172]. - Diluted earnings per share increased by $0.33 from the first quarter of 2020, but decreased by $0.13 from the second quarter of 2019[166]. - Diluted earnings per share for Q2 2020 was $0.56, compared to $0.23 in Q1 2020 and $0.69 in Q2 2019[172]. - Return on average assets (annualized) was 0.94% for Q2 2020, up from 0.43% in Q1 2020 but down from 1.28% in Q2 2019[172]. - Return on average equity (annualized) was 8.76% for Q2 2020, compared to 3.69% in Q1 2020 and 11.63% in Q2 2019[172]. Loan and Credit Quality - Provision for loan losses for the three months ended June 30, 2020, was $18.8 million, reflecting an increase of $11.6 million from the second quarter of 2019[166]. - The provision for loan losses was $48.5 million for the six months ended June 30, 2020, compared to $13.1 million for the same period in 2019[201]. - The allowance for credit losses totaled $113.5 million at June 30, 2020, representing 1.49% of total loans, up from 1.04% at June 30, 2019[201]. - Nonperforming loans to total loans was 0.36% at June 30, 2020, down from 0.40% at December 31, 2019[203]. - Approximately $115.3 million in potential problem loans were identified at June 30, 2020, up from $84.1 million at December 31, 2019[205]. - 13% of total loans outstanding were in payment deferral programs as of June 30, 2020, with 80% being commercial borrowers[204]. Interest Income and Expenses - Net interest income for Q2 2020 was $80.4 million, an increase of $3.3 million or 4.2% from the previous quarter[176]. - Average interest-earning assets increased by $742.8 million to $9.6 billion in Q2 2020, primarily due to an increase in short-term interest-bearing accounts[176]. - Interest expense decreased by $5.2 million or 42.7% in Q2 2020, with the cost of interest-bearing liabilities down to 0.45%[176]. - The interest rate spread decreased to 3.24% for the six months ended June 30, 2020, compared to 3.34% for the same period in 2019[186]. - The average yield on loans was 4.26% for the six months ended June 30, 2020, down from 4.68% in the same period of 2019[183]. Assets and Deposits - Total assets increased to $10,157.6 million as of June 30, 2020, compared to $9,553.5 million in the same period of 2019, reflecting a growth of 6.3%[183]. - Total loans increased by $491.9 million to $7.6 billion at June 30, 2020 from December 31, 2019, with commercial real estate loans increasing $114.5 million to $2.3 billion[198]. - Total deposits were $8.8 billion at June 30, 2020, up $1.2 billion, or 16.2%, from December 31, 2019[206]. - The Company reported a total interest-earning assets of $9,233.9 million for the six months ended June 30, 2020, compared to $8,747.3 million in the same period of 2019, indicating a growth of 5.6%[183]. Noninterest Income and Expenses - Noninterest income for the three months ended June 30, 2020, was $35.0 million, a decrease of $0.4 million, or 1.2%, from the prior quarter, but an increase of $0.8 million, or 2.2%, from the second quarter of 2019[188]. - Noninterest income for the six months ended June 30, 2020, was $70.4 million, up $2.4 million, or 3.5%, from the same period in 2019[189]. - Total noninterest expense for the six months ended June 30, 2020, was $136.2 million, an increase from $134.7 million in the same period of 2019, reflecting a rise of 1.1%[190]. - Noninterest expense for the three months ended June 30, 2020 was $65.3 million, down $5.5 million, or 7.8%, from the prior quarter[191]. Capital and Liquidity - Stockholders' equity was $1.1 billion, representing 10.53% of total assets, down from 11.53% as of December 31, 2019, with net income of $35.1 million for the six months ending June 30, 2020[210]. - The Company maintained a Tier 1 leverage ratio of 9.44% and a total risk-based capital ratio of 15.15% as of June 30, 2020, both exceeding regulatory minimums[214]. - The Basic Surplus measurement for liquidity was 24.1% of total assets, approximately $2.6 billion, up from 15.8% or $1.5 billion at December 31, 2019[226]. - Federal Home Loan Bank advances were $328.3 million as of June 30, 2020, with additional borrowing capacity of approximately $1.4 billion[227]. - The Company has implemented enhanced liquidity monitoring in response to the COVID-19 pandemic, focusing on maintaining a strong liquidity position[228]. COVID-19 Impact - The COVID-19 pandemic has significantly impacted the company's operations and financial condition, with ongoing uncertainty regarding its effects[167]. - The company adopted the CECL accounting methodology, which has influenced the estimated impact of the COVID-19 pandemic on expected credit losses[163]. - The company enhanced digital communication channels significantly, including dedicated webpages and social media content[173]. - 90% of non-branch employees were working remotely, with a transition back to onsite work beginning on July 13[173]. Shareholder Actions - The Company issued $100.0 million of subordinated notes with a fixed interest rate of 5.00% and a floating rate starting in 2025, netting $98.0 million after issuance costs[209]. - The Company repurchased 263,507 shares at an average price of $30.25, with 736,493 shares remaining available for repurchase under the current plan[211]. - The Board approved a cash dividend of $0.27 per share for Q3 2020, to be paid on September 15, 2020[212].