Archive: Business & Technology

Tompkins Financial Corporation reported net income and earnings per share that were in line with the same period last year.  Net income was $12.7 million for the first quarter of 2015, compared to $12.6 million for the first quarter of 2014.  Diluted earnings per share were $0.84 for the first quarter of 2015, unchanged from the same period last year.  

President and CEO, Stephen S. Romaine said "We saw positive trends for business growth during the first quarter with loan and deposit levels both up from the same period last year, and from the most recent prior quarter. At the same time, our already excellent asset quality improved further, as we saw a decline in nonperforming assets and net recoveries during the period.”

Selected Highlights:

Net interest income of $41.2 million was up 3.0% from the same period last year.

Total loans of $3.4 billion were up 7.0% over the same period in 2014.  

Credit quality improved with non-performing assets representing 0.49% of total assets, which is the lowest this percentage has been over the past 24 quarters, and remains well below the most recent peer average of 1.24% reported by the Federal Reserve1.    

Annualized return on average equity was 10.35% for the quarter ended March 31, 2015, compared to 10.88% for the same period in 2014.

Tangible book value per share is up 7.9% from the first quarter of 2014. Refer to Non-GAAP disclosure for additional details on tangible book value per share.

Net Interest Income

Net interest income of $41.2 million for the first quarter of 2015 increased 3.0% compared to the same period in 2014, and was down 1.1% from the fourth quarter of 2014. The fourth quarter included higher interest income related to interest collected on the payoff of a nonaccrual loan and a higher level of purchase accounting accretion related to loans paid off during the fourth quarter of 2014.  Although net interest margin declined from 3.53% in the fourth quarter of 2014, to 3.45% in the first quarter of 2015, the impact of the margin decline on net interest income was largely offset by $205.8 million growth in average loans during in the first quarter.

Noninterest Income

Noninterest income was $17.6 million for the first quarter of 2015, which reflects an increase of 1.2% over the same period last year and a decline of 2.3% from the fourth quarter of 2014.  The decline from the prior quarter is primarily the result of higher gains on the sale of other real estate owned (OREO) in the fourth quarter of 2014.   Fee based revenue related to insurance and deposit fees were up from the same quarter last year, while fees related to wealth management services were flat.

Noninterest Expense

Noninterest expense was $39.7 million for the first quarter of 2015, up 3.9% compared to March 31, 2014, and up 1.7% from the fourth quarter of 2014.  The increase in noninterest expense compared to the same period prior year is mainly a result of higher salary and wages expense.

Asset Quality

Asset quality trends improved in nearly all categories during the quarter.  Substandard and Special Mention loans declined by $45.8 million from the same period last year, and by $2.7 million from the previous quarter.   The percentage of nonperforming assets to total assets improved to 0.49% at March 31, 2015, compared to 0.81% at March 31, 2014.

Provision for loan and lease losses was $209,000 for the first quarter of 2015, which was an improvement from the $743,000 for the first quarter of 2014.  The Company reported net loan and lease recoveries of $279,000 in the first quarter of 2015, compared to net charge-offs of $699,000 in the first quarter of 2014.

The Company’s allowance for originated loan and lease losses totaled $28.7 million at March 31, 2015, which represented 0.99% of total originated loans, compared to 1.04% at March 31, 2014 and 0.99% at year-end 2014.  The allowance for loan and lease losses covered 145.11% of nonperforming loans and leases as of March 31, 2015, compared to 78.88% at March 31, 2014 and 128.43% at year-end 2014.

Capital Position

Capital ratios remain well above the regulatory well capitalized minimums.  Tier 1 capital to average assets of 8.85% is up from 8.68% at March 31, 2014.  The ratio of tangible common equity to tangible assets (refer to Non-GAAP disclosures) improved to 7.57%, up from 7.40% a year earlier.

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