Rising to meet the challenge. FINANCIAL INSTITUTIONS, INC. (Nasdaq: FISI) Fourth Quarter and Year-End 2021 Earnings Presentation January 31, 2022 Safe Harbor Statement Statements contained in this presentation which are not historical facts and which pertain to future operating results of Financial Institutions, Inc. (the "Company") and its subsidiaries constitute "forward- looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Similarly, statements that describe the ...

Financial Performance - Net income for Q3 2021 increased by $4.9 million to $17.2 million compared to $12.3 million in Q3 2020, with earnings per diluted share rising to $1.05 from $0.74[216] - Noninterest income for Q3 2021 was $12.1 million, slightly down from $12.2 million in Q3 2020, primarily due to lower income from derivative instruments and loan sales[220] - Noninterest expense increased to $29.2 million in Q3 2021 from $28.5 million in Q3 2020, mainly due to higher salaries and employee benefits, and technology investments[222] - Net interest income for the three months ended September 30, 2021, was $38.4 million, an increase of approximately $2.7 million compared to $35.7 million in the same period of 2020[235] - Net interest income for the nine months ended September 30, 2021, was $114.4 million, an increase of $10.9 million from $103.5 million in the same period last year[243] Interest Income and Assets - Net interest income totaled $38.3 million in Q3 2021, up from $35.5 million in Q3 2020, driven by an increase in interest-earning assets and a decrease in interest expense[218] - Average interest-earning assets increased by $553.0 million, or 13%, to $4.97 billion for the third quarter of 2021 compared to $4.41 billion in the third quarter of 2020[238] - The yield on average interest-earning assets decreased by 29 basis points to 3.31% in the third quarter of 2021 from 3.60% in the same period of 2020[237] - The net interest margin for the third quarter of 2021 was 3.07%, a decrease of 15 basis points from 3.22% in the same period of 2020[236] - The cost of average interest-bearing liabilities decreased by 20 basis points to 0.32% in the third quarter of 2021 compared to 0.52% in the same period of 2020[239] Loans and Credit Quality - Average loans increased by $110.1 million in Q3 2021 compared to the same quarter in 2020, contributing to the growth in net interest income[218] - Net charge-offs as a percentage of average loans outstanding remained stable at 0.06% for both Q3 2021 and Q3 2020[219] - The provision for credit losses was a benefit of $334 thousand in Q3 2021 compared to a provision of $3.6 million in Q3 2020, reflecting improved credit conditions[219] - Total charge-offs for the nine months ended September 30, 2021 were $6.6 million, compared to $17.9 million for the same period in 2020[302] - Non-performing loans were $6.7 million or 0.12% of total loans at September 30, 2021, compared to $9.5 million or 0.26% at December 31, 2020[304] Deposits and Funding - Total deposits increased by $696.6 million to $4.97 billion as of September 30, 2021, compared to $4.28 billion at December 31, 2020, representing a growth of approximately 16.3%[309] - Nonpublic deposits, the largest component of funding sources, totaled $2.73 billion, accounting for 55% of total deposits as of September 30, 2021, up from $2.55 billion and 60% at December 31, 2020[309] - Public deposits rose to $1.19 billion, representing 24% of total deposits as of September 30, 2021, compared to $834.9 million and 20% at December 31, 2020, largely due to seasonality[309] - Cash and cash equivalents were $288.4 million as of September 30, 2021, an increase of $194.5 million from $93.9 million at December 31, 2020[319] Capital and Regulatory Ratios - The regulatory Common Equity Tier 1 Ratio was 10.24% and the Total Risk-Based Capital Ratio was 13.25% as of September 30, 2021[223] - Common Equity Tier 1 (CET1) Capital increased to $426,790 thousand as of September 30, 2021, from $389,733 thousand as of December 31, 2020, reflecting a growth of 9.4%[322] - Total regulatory capital rose to $552,257 thousand as of September 30, 2021, compared to $521,193 thousand as of December 31, 2020, marking an increase of 5.96%[322] - The Tier 1 leverage ratio improved to 8.36% as of September 30, 2021, up from 8.25% as of December 31, 2020[327] Economic Value and Interest Rate Sensitivity - As of September 30, 2021, the estimated Economic Value of Equity (EVE) was $717,562,000, an increase from $583,156,000 on December 31, 2020[340] - The economic value of equity is sensitive to interest rate changes, with fixed-rate financial assets becoming more valuable in declining rate scenarios[338] - The analysis of interest rate sensitivity is based on assumptions regarding the pricing of loans and deposits in response to interest rate changes[335] - In a +300 basis points scenario, the estimated change in net interest income is projected to be an increase of $7,063 thousand, indicating a 4.81% change[333]

Financial Data and Key Metrics Changes - The company reported net income of $17.2 million or $1.50 per diluted share, down from $20.2 million or $1.25 per share in the second quarter, but significantly higher than $12.3 million or $0.74 per share in the third quarter of 2020 [6] - Pre-tax pre-provision income for the quarter was $21.2 million, an increase of $209,000 from the second quarter of 2021 and $1.9 million from the third quarter of 2020 [7] - Net interest income for the quarter was $38.3 million, an increase of $541,000 from the linked quarter due to one basis point of margin expansion [11] Business Line Data and Key Metrics Changes - Non-interest income was $12.1 million, up $1.9 million from the second quarter of 2021, driven by insurance business, swap fees, and limited partnership investments [22] - The insurance income increased by $717,000 due to the timing of commercial renewals and the impact of the acquisition of Northwoods Capital Benefits [23] - Total loans increased by $22 million or 0.6% from June 30, with commercial business loans decreasing by 6.2% and residential real estate loans down by 1.1% [28] Market Data and Key Metrics Changes - Total deposits at quarter end were $316 million higher than at June 30, driven by the seasonality of public deposits returning at quarter end [30] - The company experienced a decline in its TCE ratio from 7.58% to 7.25%, negatively impacted by growth in total assets due to seasonal inflow of public deposits [32] Company Strategy and Development Direction - The company is focusing on enhancing its digital banking platform and has implemented a customer relationship management solution to improve customer engagement [46][48] - The company is pursuing Banking-as-a-Service (BaaS) opportunities and has established a pipeline of potential Fintech partnerships [48] - The strategic plan emphasizes community banking services while embracing innovation and technology [52] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the normalization of credit performance indicators and the potential for reserve releases in the coming quarters [60] - The company anticipates mid-single digit growth in its total loan portfolio, excluding the impact of PPP loans [34] - The effective tax rate for 2021 is expected to be within the range of 20% to 21% [43] Other Important Information - The company completed the relocation of its Five Star Bank branch in Almira, which is part of a downtown revitalization initiative [8] - The company is investing in technology and personnel to support strategic initiatives, including digital banking and enhanced customer experience [25] Q&A Session Summary Question: Outlook for loan growth and commercial pipelines - Management indicated strong and healthy commercial loan pipelines, with some challenges due to M&A activity and supply chain constraints [56][58] Question: Credit reserves and potential releases - Management does not expect to release specific reserves until borrowers return to normal paying status, but positive trends could lead to reserve releases in the future [60] Question: Banking-as-a-Service capabilities - The company has been modernizing its foundation and is well-positioned to integrate with Fintech partners [66][68] Question: M&A activity and criteria for potential partners - The company remains open to M&A opportunities that are geographically and economically accretive [71][72] Question: Hotel portfolio performance - The hotel portfolio is performing well, with borrowers demonstrating a return to normalcy [78][79] Question: Margin dynamics and yield expectations - Management noted that credit spreads have held up well, but bond pricing has put pressure on margins [81] Question: Expense growth expectations for 2022 - Management is currently working on the 2022 budget and expects to provide an update during the next earnings call [83]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2021 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to ________ Commission File Number: 000-26481 Financial Institutions, Inc. (Exact name of registrant as specified in its charter) NE ...

Rising to meet the challenge. FINANCIAL INSTITUTIONS, INC. (Nasdaq: FISI) Second Quarter 2021 Earnings Presentation July 29, 2021 Safe Harbor Statement Statements contained in this presentation which are not historical facts and which pertain to future operating results of Financial Institutions, Inc. (the "Company") and its subsidiaries constitute "forward- looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Similarly, statements that describe the objectives, pla ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2021 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to ________ Commission File Number: 000-26481 Financial Institutions, Inc. (Exact name of registrant as specified in its charter) N ...

Financial Institutions, Inc. (NASDAQ:FISI) Q1 2021 Earnings Conference Call April 29, 2021 8:30 AM ET Company Participants Shelly Doran - Director of Investor Relations Marty Birmingham - President and CEO Jack Plants - CFO Justin Bigham - Chief Community Banking Officer Mike Grover - Director of Financial Planning and Analysis Conference Call Participants Alex Twerdahl - Piper Sandler Bryce Rowe - Hovde Marla Backer - Sidoti Operator Good day, and welcome to the Financial Institutions, Inc. First Quarter 2 ...

Financial Institutions, Inc. (NASDAQ:FISI) Q4 2020 Results Earnings Conference Call January 29, 2021 8:30 AM ET Company Participants Shelly Doran - Director of Investor & External Relations Martin Birmingham - CEO Justin Bigham - CFO Mike Grover - Director of Financial Planning and Analysis Conference Call Participants Alex Twerdahl - Piper Sandler Operator Good morning, and welcome to Financial Institutions, Inc. Fourth Quarter and Full Year 2020 Earnings Call. [Operator Instructions] Please note this even ...

Delivering on a brighter tomorrow. FINANCIAL INSTITUTIONS, INC. (Nasdaq: FISI) Fourth Quarter and Year-End 2020 Earnings Presentation January 28, 2021 Safe Harbor Statement Statements contained in this presentation which are not historical facts and which pertain to future operating results of Financial Institutions, Inc. (the "Company") and its subsidiaries constitute "forward- looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Similarly, statements that describ ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2019 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to ________ Commission File Number: 000-26481 (Exact name of registrant as specified in its charter) | --- | --- | --- | --- | |--- ...