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Exhibit 99.1

 

FOR IMMEDIATE RELEASE

ATTENTION: FINANCIAL AND BUSINESS EDITORS

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NBT BANCORP INC. ANNOUNCES DILUTED EARNINGS PER SHARE OF $0.43 FOR THE FIRST QUARTER OF 2016

NORWICH, NY (April 25, 2016) – NBT Bancorp Inc. (NBT) (NASDAQ: NBTB) reported net income for the first quarter of 2016 of $18.9 million, up from $18.2 million for the prior year.  Diluted earnings per share for the three months ended March 31, 2016 was $0.43, up from $0.41 for the prior year.

2016 First Quarter Highlights:

·	First quarter loan growth of 5.8% (annualized)

·	Average demand deposits up 11.3% from the first quarter of 2015

·	Net interest income up 3.9% from the first quarter of 2015

·	Positive trends continue for asset quality indicators:

o	Past due loans to total loans improved to 0.50% at March 31, 2016 from 0.62% at December 31, 2015

o	Annualized net charge-offs to average loans improved to 0.33% for the first quarter of 2016 from 0.38% for the full year of 2015

“Our first quarter 2016 results demonstrate our strong financial performance and sustained favorable trends in organic loan and deposit growth and asset quality indicators,” said NBT President and CEO Martin Dietrich. “As NBT continues to grow and respond to our changing business environment, we remain deeply rooted in our core values, including superior customer service, continuous improvement, community involvement and teamwork. We also continue to focus on cultivating long-term value for our shareholders through our investments in our people, technology and business strategies.”

Net interest income was $64.6 million for the first quarter of 2016, up $1.1 million from the previous quarter, and up $2.4 million from the first quarter of 2015.  Fully taxable equivalent (“FTE”) net interest margin was 3.47% for the three months ended March 31, 2016, up from 3.42% for the previous quarter and down from 3.60% for the first quarter of 2015.  The increase from the previous quarter was driven by an increase in yields on earning assets, partially offset by slightly higher costs of interest bearing liabilities.  Average interest earning assets were up $127.1 million, or 1.7%, for the first quarter of 2016 as compared to the prior quarter.  This increase was driven primarily by a $117.8 million increase in average securities available for sale from the fourth quarter of 2015 to the first quarter of 2016.  Yields on earning assets increased by 5 basis points from 3.70% during the fourth quarter of 2015 to 3.75% for the first quarter of 2016.  This increase was driven by an 8 basis-point increase in loan yields from the fourth quarter of 2015 to the first quarter of 2016.  The increase in average earning assets and yields on earning assets in the first quarter of 2016 resulted in a $1.2 million increase in interest income from the fourth quarter of 2015.  Interest expense for the first quarter of 2016 was up $0.1 million from the fourth quarter of 2015 and resulted primarily from a 2.0% increase in average interest bearing liabilities during the first quarter of 2016 as well as a 1 basis-point increase in the rates paid on interest bearing liabilities for the same period.  Interest expense for the first quarter of 2016 was up $0.3 million from the same period in 2015 and resulted primarily from a 5.2% increase in average interest bearing liabilities during the first quarter of 2016 as well as a 1 basis-point increase in the rates paid on interest bearing liabilities as compared to the first quarter of 2015.

 

Noninterest income for the three months ended March 31, 2016 was $28.4 million, down $4.1 million from the fourth quarter of 2015, and up $1.8 million from the same period in 2015.  The decrease from the prior quarter was primarily driven by a $3.0 million gain in the fourth quarter of 2015 from the sale of an equity investment.  In addition, other noninterest income was down $1.1 million in the first quarter of 2016 as compared with the fourth quarter of 2015 due primarily to a favorable settlement of a prior accrual in the fourth quarter of 2015.  Service charges on deposit accounts were down $0.4 million from the fourth quarter of 2015 to the first quarter of 2016 due to seasonal overdraft charges in the fourth quarter of 2015.  Retirement plan administration fees and trust revenue were both down $0.4 million from the fourth quarter of 2015 primarily due to less favorable market conditions during the first quarter of 2016 compared with the fourth quarter of 2015.  These decreases were partially offset by an $0.8 million increase in insurance and other financial services revenue in the first quarter of 2016 as compared with the prior quarter due to seasonality.  In addition, bank-owned life insurance income was up $0.4 million from the fourth quarter of 2015 due primarily to death benefits received during the first quarter of 2016.

Noninterest expense for the three months ended March 31, 2016 was $58.2 million, down $2.4 million from the previous quarter, and up $0.5 million from the same period in 2015.  The decrease from the prior quarter was due primarily to a $1.1 million decrease in other noninterest expense from the fourth quarter of 2015 to the first quarter of 2016.  This decrease was due to timing of various operating expense items.  In addition, salaries and employee benefits decreased $0.6 million in the first quarter of 2016 as compared with the fourth quarter of 2015 driven by contract termination costs incurred during the fourth quarter of 2015, partially offset by higher retirement plan costs during the first quarter of 2016.

Asset Quality

Net charge-offs were $4.8 million for the three months ended March 31, 2016, down from $7.6 million for the prior quarter, and up from $4.6 million for the same period in 2015.  Provision expense was $6.1 million for the three months ended March 31, 2016, as compared with $5.8 million for the prior quarter, and $3.6 million for the first quarter of 2015.  Provision expense was higher than the previous quarter and the prior year primarily due to loan growth.  Annualized net charge-offs to average loans for the first quarter of 2016 was 0.33%, compared with 0.38% for the full year of 2015 and 0.34% for the first quarter of 2015.

Nonperforming loans to total loans was 0.69% at March 31, 2016, up from 0.64% for the prior quarter, and down from 0.85% at March 31, 2015.  Past due loans as a percentage of total loans were 0.51% at March 31, 2016, down from 0.64% at December 31, 2015, and 0.56% at March 31, 2015.

The allowance for loan losses totaled $64.3 million at March 31, 2016, compared to $63.0 million at December 31, 2015, and $65.4 million at March 31, 2015.  The allowance for loan losses as a percentage of loans was 1.08% (1.18% excluding acquired loans with no related allowance recorded) at March 31, 2016, compared to 1.07% (1.18% excluding acquired loans with no related allowance recorded) at December 31, 2015 and 1.16% (1.29% excluding acquired loans with no related allowance recorded) at March 31, 2015.

 

Balance Sheet

Total assets were $8.5 billion at March 31, 2016, up $210.3 million, or 2.5% from December 31, 2015.  Loans were $6.0 billion at March 31, 2016, up $84.7 million from December 31, 2015, due to loan growth in the first quarter of 2016.  The increase in loans in the first quarter resulted from growth in the commercial, residential and consumer portfolios.  Consumer loan growth was supplemented with approximately $30 million in loans from LendingClub Corporation as part of the Company’s ongoing relationship which began with the sale of Springstone LLC in the second quarter of 2014.   Total deposits were $6.9 billion at March 31, 2016, up $300.2 million, or 4.5%, from December 31, 2015.  Stockholders’ equity was $881.7 million, representing a total equity-to-total assets ratio of 10.41% at March 31, 2016, compared with $882.0 million or a total equity-to-total assets ratio of 10.67% at December 31, 2015.

Stock Repurchase Program

The Company purchased 675,535 shares of its common stock during the first quarter of 2016 at an average price of $25.45 per share under a previously announced plan.  As of March 31, 2016, there were 277,313 shares available for repurchase under this plan announced on July 27, 2015 and set to expire on December 31, 2016.  On March 28, 2016, the NBT Board of Directors authorized a new program for NBT to repurchase up to an additional 1,000,000 shares of its outstanding common stock.  This plan expires on December 31, 2017.

Corporate Overview

Forward-Looking Statements

This news release contains forward-looking statements. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of the management of NBT Bancorp and its subsidiaries and on the information available to management at the time that these statements were made. There are a number of factors, many of which are beyond NBT’s control, that could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following possibilities: (1) competitive pressures among depository and other financial institutions may increase significantly; (2) revenues may be lower than expected; (3) changes in the interest rate environment may reduce interest margins; (4) general economic conditions, either nationally or regionally, may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and/or a reduced demand for credit; (5) legislative or regulatory changes, including changes in accounting standards and tax laws, may adversely affect the businesses in which NBT is engaged; (6) competitors may have greater financial resources and develop products that enable such competitors to compete more successfully than NBT; and (7) adverse changes may occur in the securities markets or with respect to inflation.  Forward-looking statements speak only as of the date they are made. Except as required by law, NBT does not update forward-looking statements to reflect subsequent circumstances or events.

 

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).  These measures adjust GAAP measures to exclude the effects of acquisition related intangible amortization expense on earnings and equity as well as providing a fully taxable equivalent yield on securities and loans.  Where non-GAAP disclosures are used in this press release, the comparable GAAP measure, as well as a reconciliation to the comparable GAAP measure, is provided in the accompanying tables.  Management believes that these non-GAAP measures provided useful information that is important to an understanding of the results of NBT’s core business as well as provide information standard in the financial institution industry.  Non-GAAP measures should not be considered a substitute for financial measures determined in accordance with GAAP and investors should consider NBT’s performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of NBT.

 

		2016				2015
		1st Q				4th Q				3rd Q				2nd Q				1st Q
Profitability:
Diluted Earnings Per Share		$	0.43			$	0.43			$	0.45			$	0.43			$	0.41
Weighted Average Diluted Common Shares Outstanding			43,707,489				44,072,049				44,262,426				44,530,123				44,641,913
Return on Average Assets (1)			0.92	%			0.93	%			0.97	%			0.97	%			0.94	%
Return on Average Equity (1)			8.63	%			8.58	%			8.97	%			8.81	%			8.46	%
Return on Average Tangible Common Equity (1)(5)			13.17	%			13.04	%			13.66	%			13.47	%			13.08	%
Net Interest Margin (1)(2)			3.47	%			3.42	%			3.48	%			3.51	%			3.60	%
Balance Sheet Data:
Securities Available for Sale		$	1,259,874			$	1,174,544			$	1,058,397			$	1,129,249			$	1,071,654
Securities Held to Maturity		$	466,914			$	471,031			$	470,758			$	454,312			$	456,773
Net Loans		$	5,903,491			$	5,820,115			$	5,806,129			$	5,705,929			$	5,557,664
Total Assets		$	8,472,964			$	8,262,646			$	8,178,976			$	8,081,892			$	7,877,527
Total Deposits		$	6,905,042			$	6,604,843			$	6,600,627			$	6,371,479			$	6,479,437
Total Borrowings		$	579,441			$	674,124			$	594,163			$	743,893			$	425,143
Total Liabilities		$	7,591,237			$	7,380,642			$	7,302,760			$	7,205,921			$	7,000,033
Stockholders’ Equity		$	881,727			$	882,004			$	876,216			$	875,971			$	877,494
Asset Quality:
Nonaccrual Loans		$	38,944			$	33,744			$	42,524			$	42,286			$	45,053
90 Days Past Due and Still Accruing			2,185				3,662				3,790				1,994				2,601
Total Nonperforming Loans			41,129				37,406				46,314				44,280				47,654
Other Real Estate Owned			2,716				4,666				4,855				4,649				4,387
Total Nonperforming Assets			43,845				42,072				51,169				48,929				52,041
Allowance for Loan Losses			64,318				63,018				64,859				64,959				65,359
Asset Quality Ratios (Total):
Allowance for Loan Losses to Total Loans			1.08	%			1.07	%			1.10	%			1.13	%			1.16	%
Total Nonperforming Loans to Total Loans			0.69	%			0.64	%			0.79	%			0.77	%			0.85	%
Total Nonperforming Assets to Total Assets			0.52	%			0.51	%			0.63	%			0.61	%			0.66	%
Allowance for Loan Losses to Total Nonperforming Loans			156.38	%			168.47	%			140.04	%			146.70	%			137.15	%
Past Due Loans to Total Loans			0.50	%			0.62	%			0.63	%			0.61	%			0.54	%
Net Charge-Offs to Average Loans (1)			0.33	%			0.51	%			0.35	%			0.30	%			0.34	%
Asset Quality Ratios (Originated) (3):
Allowance for Loan Losses to Loans			1.18	%			1.18	%			1.21	%			1.24	%			1.29	%
Nonperforming Loans to Loans			0.67	%			0.61	%			0.63	%			0.59	%			0.69	%
Allowance for Loan Losses to Nonperforming Loans			175.40	%			193.00	%			192.49	%			208.99	%			188.68	%
Past Due Loans to Loans			0.51	%			0.64	%			0.67	%			0.64	%			0.56	%
Capital:
Equity to Assets			10.41	%			10.67	%			10.71	%			10.84	%			11.14	%
Book Value Per Share		$	20.57			$	20.31			$	20.29			$	20.05			$	19.95
Tangible Book Value Per Share (4)		$	13.99			$	13.79			$	13.80			$	13.61			$	13.52
Tier 1 Leverage Ratio			9.15	%			9.44	%			9.34	%			9.57	%			9.72	%
Common Equity Tier 1 Capital Ratio			9.79	%			10.20	%			10.04	%			10.22	%			10.46	%
Tier 1 Capital Ratio			11.28	%			11.73	%			11.57	%			11.78	%			12.05	%
Total Risk-Based Capital Ratio			12.29	%			12.74	%			12.62	%			12.84	%			13.15	%
Common Stock Price (End of Period)		$	26.95			$	27.88			$	26.94			$	26.17			$	25.06

		2016				2015
		1st Q				4th Q				3rd Q				2nd Q				1st Q
Net Income		$	18,891			$	19,127			$	19,851			$	19,281			$	18,166
Amortization of intangible assets (net of tax)			670				750				712				725				784
		$	19,561			$	19,877			$	20,563			$	20,006			$	18,950
Average stockholders’ equity		$	880,311			$	884,743			$	878,305			$	878,164			$	871,074
Less: average goodwill and other intangibles			282,751				279,904				281,048				282,272				283,508
Average tangible common equity		$	597,560			$	604,839			$	597,257			$	595,892			$	587,566

ASSETS		March 31, 2016				December 31, 2015
Cash and due from banks		$	139,909			$	130,593
Short term interest bearing accounts			15,601				9,704
Securities available for sale, at fair value			1,259,874				1,174,544
Securities held to maturity (fair value of $475,110 and $473,140 at March 31, 2016 and December 31, 2015, respectively)			466,914				471,031
Trading securities			8,905				8,377
Federal Reserve and Federal Home Loan Bank stock			32,262				36,673
Loans			5,967,809				5,883,133
Less allowance for loan losses			64,318				63,018
Net loans			5,903,491				5,820,115
Premises and equipment, net			86,407				88,826
Goodwill			265,957				265,957
Intangible assets, net			16,168				17,265
Bank owned life insurance			161,878				117,044
Other assets			115,598				122,517
TOTAL ASSETS		$	8,472,964			$	8,262,646
LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits:
Demand (noninterest bearing)		$	2,008,763			$	1,998,165
Savings, NOW, and money market			4,007,621				3,697,851
Time			888,658				908,827
Total deposits			6,905,042				6,604,843
Short-term borrowings			347,868				442,481
Long-term debt			130,377				130,447
Junior subordinated debt			101,196				101,196
Other liabilities			106,754				101,675
Total liabilities			7,591,237				7,380,642
Total stockholders’ equity			881,727				882,004
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY		$	8,472,964			$	8,262,646

		Three Months Ended March 31,
		2016				2015
Interest, fee and dividend income:
Loans		$	61,230			$	59,518
Securities available for sale			5,987				4,945
Securities held to maturity			2,288				2,283
Other			449				480
Total interest, fee and dividend income			69,954				67,226
Interest expense:
Deposits			3,597				3,573
Short-term borrowings			328				121
Long-term debt			833				826
Junior subordinated debt			619				540
Total interest expense			5,377				5,060
Net interest income			64,577				62,166
Provision for loan losses			6,098				3,642
Net interest income after provision for loan losses			58,479				58,524
Noninterest income:
Insurance and other financial services revenue			6,946				6,374
Service charges on deposit accounts			3,939				4,072
ATM and debit card fees			4,583				4,248
Retirement plan administration fees			3,754				3,196
Trust			4,376				4,450
Bank owned life insurance income			1,291				1,559
Net securities gains			29				14
Other			3,449				2,621
Total noninterest income			28,367				26,534
Noninterest expense:
Salaries and employee benefits			32,441				30,182
Occupancy			5,491				6,066
Data processing and communications			4,050				4,103
Professional fees and outside services			3,231				3,497
Equipment			3,460				3,249
Office supplies and postage			1,547				1,619
FDIC expenses			1,258				1,198
Advertising			504				719
Amortization of intangible assets			1,096				1,284
Loan collection and other real estate owned			705				872
Other operating			4,441				4,913
Total noninterest expense			58,224				57,702
Income before income taxes			28,622				27,356
Income taxes			9,731				9,190
Net income		$	18,891			$	18,166
Earnings Per Share:
Basic		$	0.44			$	0.41
Diluted		$	0.43			$	0.41

		2016				2015
		1st Q				4th Q				3rd Q				2nd Q				1st Q
Interest, fee and dividend income:
Loans		$	61,230			$	60,781			$	61,656			$	59,873			$	59,518
Securities available for sale			5,987				5,204				5,125				5,144				4,945
Securities held to maturity			2,288				2,317				2,318				2,315				2,283
Other			449				469				401				395				480
Total interest, fee and dividend income			69,954				68,771				69,500				67,727				67,226
Interest expense:
Deposits			3,597				3,613				3,554				3,517				3,573
Short-term borrowings			328				222				296				144				121
Long-term debt			833				848				845				836				826
Junior subordinated debt			619				576				560				545				540
Total interest expense			5,377				5,259				5,255				5,042				5,060
Net interest income			64,577				63,512				64,245				62,685				62,166
Provision for loan losses			6,098				5,779				4,966				3,898				3,642
Net interest income after provision for loan losses			58,479				57,733				59,279				58,787				58,524
Noninterest income:
Insurance and other financial services revenue			6,946				6,139				5,862				5,836				6,374
Service charges on deposit accounts			3,939				4,350				4,349				4,285				4,072
ATM and debit card fees			4,583				4,541				4,780				4,679				4,248
Retirement plan administration fees			3,754				4,135				3,249				3,566				3,196
Trust			4,376				4,769				4,611				5,196				4,450
Bank owned life insurance income			1,291				916				931				928				1,559
Net securities gains			29				3,044				3				26				14
Gain on the sale of Springstone investment			-				-				4,179				-				-
Other			3,449				4,577				3,297				3,699				2,621
Total noninterest income			28,367				32,471				31,261				28,215				26,534
Noninterest expense:
Salaries and employee benefits			32,441				33,078				30,227				30,831				30,182
Occupancy			5,491				5,291				5,326				5,412				6,066
Data processing and communications			4,050				3,990				4,207				4,288				4,103
Professional fees and outside services			3,231				3,378				3,137				3,395				3,497
Equipment			3,460				3,491				3,352				3,316				3,249
Office supplies and postage			1,547				1,545				1,576				1,627				1,619
FDIC expenses			1,258				1,312				1,355				1,280				1,198
Advertising			504				780				421				734				719
Amortization of intangible assets			1,096				1,228				1,165				1,187				1,284
Loan collection and other real estate owned			705				1,027				699				22				872
Other operating			4,441				5,499				8,426				5,872				4,913
Total noninterest expense			58,224				60,619				59,891				57,964				57,702
Income before income taxes			28,622				29,585				30,649				29,038				27,356
Income taxes			9,731				10,458				10,798				9,757				9,190
Net income		$	18,891			$	19,127			$	19,851			$	19,281			$	18,166
Earnings per share:
Basic		$	0.44			$	0.44			$	0.45			$	0.44			$	0.41
Diluted		$	0.43			$	0.43			$	0.45			$	0.43			$	0.41

		Average Balance				Interest				Yield/ Rates				Average Balance				Interest				Yield/ Rates
Three Months ended March 31,		2016												2015
ASSETS:
Short-term interest bearing accounts		$	13,639			$	21				0.63	%		$	9,156			$	7				0.30	%
Securities available for sale (1)(2)			1,188,437				6,090				2.06	%			1,018,880				5,084				2.02	%
Securities held to maturity (1)			465,916				2,870				2.48	%			454,957				2,766				2.47	%
Investment in FRB and FHLB Banks			33,470				428				5.14	%			30,931				473				6.20	%
Loans (3)			5,884,073				61,401				4.20	%			5,586,942				59,704				4.33	%
Total interest earning assets		$	7,585,535			$	70,810				3.75	%			7,100,866			$	68,034				3.89	%
Other assets			699,194												696,091
Total assets		$	8,284,729											$	7,796,957
LIABILITIES AND STOCKHOLDERS’ EQUITY:
Money market deposit accounts		$	1,653,930				912				0.22	%		$	1,544,488			$	786				0.21	%
NOW deposit accounts			1,051,959				132				0.05	%			972,263				123				0.05	%
Savings deposits			1,105,480				158				0.06	%			1,040,031				162				0.06	%
Time deposits			921,754				2,395				1.04	%			1,014,904				2,502				1.00	%
Total interest bearing deposits		$	4,733,123			$	3,597				0.31	%		$	4,571,686			$	3,573				0.32	%
Short-term borrowings			369,443				328				0.36	%			265,420				121				0.19	%
Long-term debt			130,420				833				2.57	%			130,879				826				2.56	%
Junior subordinated debt			101,196				619				2.46	%			101,196				540				2.16	%
Total interest bearing liabilities		$	5,334,182			$	5,377				0.41	%		$	5,069,181			$	5,060				0.40	%
Demand deposits			1,970,315												1,770,703
Other liabilities			99,921												85,999
Stockholders’ equity			880,311												871,074
Total liabilities and stockholders’ equity		$	8,284,729											$	7,796,957
Net interest income (FTE)							65,433												62,974
Interest rate spread											3.34	%											3.49	%
Net interest margin											3.47	%											3.60	%
Taxable equivalent adjustment							856												808
Net interest income						$	64,577											$	62,166

		2016				2015
		1st Q				4th Q				3rd Q				2nd Q				1st Q
Residential real estate mortgages		$	1,211,821			$	1,196,780			$	1,177,195			$	1,154,416			$	1,125,886
Commercial			1,168,191				1,159,089				1,167,007				1,147,586				1,140,114
Commercial real estate			1,448,920				1,430,618				1,435,378				1,423,489				1,349,940
Consumer			1,620,669				1,568,204				1,549,844				1,495,160				1,452,070
Home equity			518,208				528,442				541,564				550,237				555,013
Total loans		$	5,967,809			$	5,883,133			$	5,870,988			$	5,770,888			$	5,623,023