Financial Institutions, Inc. Announces Second Quarter 2025 Results

Core Viewpoint - Financial Institutions, Inc. reported a net income of $17.5 million for Q2 2025, reflecting a 4% increase from Q1 2025 but a decrease from Q2 2024, driven by margin expansion and increased net interest income [2][4]. Financial Performance - Net income for Q2 2025 was $17.5 million, compared to $16.9 million in Q1 2025 and $25.6 million in Q2 2024 [2]. - Net income available to common shareholders was $17.2 million, or $0.85 per diluted share, up from $16.5 million, or $0.81 per diluted share in Q1 2025, but down from $25.3 million, or $1.62 per diluted share in Q2 2024 [2]. - The company recorded a provision for credit losses of $2.6 million in Q2 2025, down from $2.9 million in Q1 2025 and up from $2.0 million in Q2 2024 [2][27]. Revenue and Margin - Net interest income increased to $49.1 million in Q2 2025, up $2.3 million from Q1 2025 and $7.9 million from Q2 2024 [6][8]. - The net interest margin was 3.49% in Q2 2025, an increase of 14 basis points from Q1 2025 and 62 basis points from Q2 2024 [8][10]. Loan and Deposit Trends - Total loans were $4.54 billion at June 30, 2025, a decrease of $17.3 million, or 0.4%, from March 31, 2025, but an increase of $74.5 million, or 1.7%, from June 30, 2024 [8][17]. - Total deposits were $5.16 billion at June 30, 2025, down $216.9 million, or 4.0%, from March 31, 2025, primarily due to seasonal public deposit outflows [8][18]. Expense Management - Noninterest expense was $35.7 million in Q2 2025, compared to $33.7 million in Q1 2025 and $33.0 million in Q2 2024 [12]. - The company aims to maintain an efficiency ratio below 60% and is focused on expense management to support positive operating leverage in 2025 [4][5]. Credit Quality - Non-performing loans were $32.4 million, or 0.72% of total loans, at June 30, 2025, down from $40.0 million, or 0.88% at March 31, 2025 [25]. - The allowance for credit losses on loans to total loans ratio was 1.04% at June 30, 2025, compared to 1.08% at March 31, 2025 [26]. Capital Management - Total assets were $6.14 billion at June 30, 2025, down $196.7 million from March 31, 2025 [17]. - Shareholders' equity was $601.7 million at June 30, 2025, an increase from $589.9 million at March 31, 2025 [20]. Dividend and Shareholder Returns - The company declared a common stock dividend of $0.31 per share, consistent with the linked quarter and reflecting a 3.3% increase over the year-ago quarter [23].