Tompkins Financial Corporation Reports Second Quarter Financial Results

Company Release - 7/26/2024 9:00 AM ET

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ITHACA, N.Y.--(BUSINESS WIRE)-- Tompkins Financial Corporation (NYSE American: TMP)

Tompkins Financial Corporation ("Tompkins" or the "Company") reported diluted earnings per share of $1.10 for the second quarter of 2024, down 6.8% from the immediate prior quarter, and up 86.4% from diluted earnings per share of $0.59 reported in the second quarter of 2023. Net income for the second quarter of 2024 was $15.7 million, down $1.2 million or 7.1% compared to the most recent prior quarter, and up $7.2 million, or 85.0%, when compared to the $8.5 million reported for the same period in 2023. The increase in diluted earnings per share and net income compared to the results for the second quarter of 2023 largely reflects the Company's sale of $80.9 million of available-for-sale securities which resulted in a $7.1 million (or $0.37 per share) loss on securities transactions in the second quarter of 2023.

For the six months ended June 30, 2024, diluted earnings per share were $2.29, up 18.0% from $1.94 for the six months ended June 30, 2023. Year-to-date net income was $32.6 million for the six month period ended June 30, 2024, up $4.7 million, or 16.9%, when compared to $27.9 million for the same six month period in 2023. The growth in year-to-date diluted earnings per share and net income relative to the year-to-date results for the same six month period in 2023 is similarly attributable to the impact caused by the loss on securities transactions described above.

Tompkins President and CEO, Stephen Romaine, commented, "Our year to date and second quarter results have been positively impacted by a stabilizing net interest margin and growth throughout our business. Year over year loans are up 7.7% and year to date noninterest income was up 33%, or 10% excluding the impact from the loss on the sale of securities in the second quarter of 2023. We have remained focused on expenses with noninterest expenses year to date lower by 2.3%. As we continue to leverage our balance sheet we are seeing strengthening operating results with stabilizing and growing revenue and lower expenses. We look forward to driving growth through quality customer relationships supported by our strong capital and liquidity."

SELECTED HIGHLIGHTS FOR THE PERIOD:

• Net interest margin for the second quarter of 2024 was 2.73%, unchanged from the first quarter of 2024, and down from 2.83% for the second quarter of 2023.
• Total cost of funds was up 10 basis points compared to the first quarter 2024, down from a 24 basis point increase from the fourth quarter of 2023 to the first quarter of 2024.
• Fee-based services (insurance, wealth management, service charges on deposit accounts and cards) revenues for the second quarter of 2024 were up $903,000 or 5.0% compared to the second quarter of 2023.
• Total operating expenses of $49.9 million for the second quarter of 2024 were in line with the most recent prior quarter, and down $2.0 million or 3.9% compared to the second quarter of 2023.
• Total loans at June 30, 2024 were up $121.3 million, or 2.2% (8.7% on an annualized basis) compared to the immediate prior quarter, and up $409.5 million, or 7.7%, from June 30, 2023.
• Total deposits at June 30, 2024 were $6.3 billion, down $163.7 million, or 2.5% from March 31, 2024, and $168.8 million, or 2.6%, from June 30, 2023.
• Loan to deposit ratio at June 30, 2024 was 91.7%, compared to 87.5% for the immediate prior quarter.
• Regulatory Tier 1 capital to average assets was 9.15% at June 30, 2024, up compared to 9.08% reported at March 31, 2024, and down compared to 9.57% at June 30, 2023.

NET INTEREST INCOME

Net interest income was $51.0 million for the second quarter of 2024, up from $50.7 million for the first quarter of 2024, and down from $51.9 million for the second quarter of 2023. Net interest income for the quarter ended June 30, 2024 was impacted by increases in interest expense, which totaled $34.3 million for the second quarter of 2024 compared to $20.0 million for the same period in 2023, partially offset by increased interest and dividend income, which increased by $13.4 million when compared to the second quarter of 2023.

For the six months ended June 30, 2024, net interest income was $101.6 million, down $4.5 million or 4.3% when compared to the same period in 2023.

Net interest margin was 2.73% for the second quarter of 2024, unchanged from the first quarter of 2024, and down from the 2.83% reported for the second quarter of 2023. The decrease in net interest margin, when compared to the prior year, was mainly driven by higher funding costs, driven by market rates and higher borrowings due to lower deposit balances, and was partially offset by higher yields on interest earnings assets.

Average loans for the quarter ended June 30, 2024 were up $65.9 million, or 1.2%, from the first quarter of 2024, and were up $382.8 million, or 7.2%, compared to the prior year second quarter. The increase in average loans over both prior periods was mainly in the commercial real estate and commercial and industrial portfolios. The average yield on interest-earning assets for the quarter ended June 30, 2024 was 4.56%, which was up from 4.47% for the prior quarter ended March 31, 2024, and up from 3.91% for the quarter ended June 30, 2023.

Average total deposits for the second quarter of 2024 were down $42.9 million, or 0.7%, compared to the first quarter of 2024, and down $128.3 million or 2.0% compared to the same period in 2023. The decrease compared to the prior quarter was mainly driven by seasonal deposit trends, while the decrease compared to the prior year was largely driven by inflation and persistent rate competition for deposits due to the current interest rate environment and tightening monetary policy. The cost of interest-bearing deposits of 2.27% for the second quarter of 2024 was up 10 basis points from 2.17% for the first quarter of 2024, and up 86 basis points from 1.41% for the second quarter of 2023. The ratio of average noninterest bearing deposits to average total deposits for the second quarter of 2024 was 29.1% compared to 28.8% for the first quarter of 2024, and 31.1% for the quarter ended June 30, 2023. The average cost of interest-bearing liabilities for the second quarter of 2024 of 2.64% represents an increase of 13 basis points over the first quarter of 2024, and an increase of 100 basis points over the same period in 2023.

NONINTEREST INCOME

Noninterest income represented 29.9% of total revenue for the second quarter of 2024 compared to 30.4% for the first quarter of 2024, and 19.6% for the second quarter of 2023. Noninterest income of $21.8 million for the second quarter of 2024 was up $9.2 million or 72.6% compared to the same period in 2023. Year-to-date noninterest income of $43.9 million was up $10.9 million or 33.0% compared to the same period in 2023. The increase in quarterly and year-to-date noninterest income compared to the same periods in 2023 was mainly due to a $7.1 million loss on the sale of available-for-sale securities discussed above. Also included in the increase in the second quarter of 2024 over the same period prior year are fee-based revenues which included insurance commissions and fees, up $415,000, wealth management fees, up $171,000, service charges on deposit accounts, up $126,000, and card services income, up $191,000.

NONINTEREST EXPENSE

Noninterest expense was $49.9 million for the second quarter of 2024, which was down $2.0 million or 3.9% compared to the second quarter of 2023. Year-to-date noninterest expense for the period ended June 30, 2024 was $99.8 million, a decrease of $2.3 million or 2.3% compared to the $102.1 million reported for the same period in 2023. The decrease was mainly driven by lower other expenses (legal fees, marketing expense, professional fees, and travel and meeting expense) and lower salaries, wages and other employee benefits in the second quarter of 2024 compared to the same period in 2023.

INCOME TAX EXPENSE

The provision for income tax expense was $4.9 million for an effective rate of 23.8% for the second quarter of 2024, compared to tax expense of $1.8 million and an effective rate of 17.3% for the same quarter in 2023. For the first six months of 2024, the provision for income tax expense was $10.1 million and the effective tax rate was 23.6% compared to provision expense of $7.7 million and an effective tax rate of 21.6% for the same period in 2023. Lower tax expense for both the quarter and year-to-date periods in 2023 was mainly a result of lower income associated with the loss on the sale of securities described above.

ASSET QUALITY

The allowance for credit losses represented 0.92% of total loans and leases at June 30, 2024, unchanged from the most recent prior quarter and December 31, 2023. The ratio of the allowance to total nonperforming loans and leases was 84.94% at June 30, 2024, compared to 82.47% at March 31, 2024, and 154.76% at June 30, 2023. The decrease in the ratio compared to the same prior year period was due to the increase in nonperforming loans and leases discussed in more detail below.

Provision for credit losses for the second quarter of 2024 was $2.2 million compared to provision expense of $2.3 million for the same period in 2023. Provision for credit losses for the six months ended June 30, 2024 was $3.0 million compared to $1.4 million for the six months ended June 30, 2023. The increase in provision expense for the year-to-date period compared to the same period in 2023 was mainly driven by loan growth and changes in off balance sheet reserves driven by an increase in loan pipeline. Net charge-offs for the second quarter of 2024 were $509,000 compared to net recoveries of $27,000 reported for the same period in 2023.

Nonperforming assets represented 0.79% of total assets at June 30, 2024, down from 0.81% reported at March 31, 2024, and up compared to 0.41% at June 30, 2023. At June 30, 2024, nonperforming loans and leases totaled $62.5 million, compared to $62.7 million at March 31, 2024 and $31.4 million at June 30, 2023. The increase in nonperforming loans and leases at June 30, 2024 compared to results at June 30, 2023 was mainly due to the addition in the fourth quarter of 2023 of one relationship totaling approximately $33.3 million with two commercial real estate properties included in the office space and mixed use properties portion of the commercial real estate portfolio. The Company believes that the existing collateral securing the loans is sufficient to cover the exposure as of June 30, 2024.

Special Mention and Substandard loans and leases totaled $116.2 million at June 30, 2024, compared to $118.7 million reported at March 31, 2024, and $118.1 million reported at June 30, 2023.

CAPITAL POSITION

Capital ratios at June 30, 2024 remained well above the regulatory minimums for well-capitalized institutions. The ratio of total capital to risk-weighted assets was 13.26% at June 30, 2024, compared to 13.43% at March 31, 2024, and 14.48% at June 30, 2023. The ratio of Tier 1 capital to average assets was 9.15% at June 30, 2024, compared to 9.08% at March 31, 2024, and 9.57% at June 30, 2023.

LIQUIDITY POSITION

The Company's liquidity position at June 30, 2024 was stable and consistent with the immediately prior quarter. Liquidity is enhanced by ready access to national and regional wholesale funding sources including Federal funds purchased, repurchase agreements, brokered deposits, Federal Reserve Bank's Discount Window advances and Federal Home Loan Banks (FHLB) advances. The Company maintains ready access to liquidity of $1.4 billion, or 17.3% of total assets at June 30, 2024. As a member of the FHLB, the Company can use certain unencumbered mortgage-related assets and securities to secure borrowings from the FHLB. At June 30, 2024 the Company had an available borrowing capacity at the FHLB of $661.8 million. Through various programs at the Federal Reserve Bank, the Company has the ability to use certain loans and securities to secure borrowings from the Federal Reserve Bank's Discount Window. At June 30, 2024 the available borrowing capacity with the Federal Reserve Bank was $137.7 million, secured by loans. In addition to the available borrowing lines at the FHLB and Federal Reserve Bank, at June 30, 2024, the Company maintained $553.3 million of unencumbered securities which could be pledged to further enhance secured borrowing capacity.

ABOUT TOMPKINS FINANCIAL CORPORATION

Tompkins Financial Corporation is a banking and financial services company serving the Central, Western, and Hudson Valley regions of New York and the Southeastern region of Pennsylvania. Headquartered in Ithaca, NY, Tompkins Financial is parent to Tompkins Community Bank and Tompkins Insurance Agencies, Inc. Tompkins Community Bank provides a full array of wealth management services under the Tompkins Financial Advisors brand, including investment management, trust and estate, financial and tax planning services. For more information on Tompkins Financial, visit www.tompkinsfinancial.com.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995:

This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The statements contained in this press release that are not statements of historical fact may include forward-looking statements that involve a number of risks and uncertainties. Forward-looking statements may be identified by use of such words as "may", "will", "estimate", "intend", "continue", "believe", "expect", "plan", "commit", or "anticipate", the negative and other variations of these terms and other similar words. Examples of forward-looking statements may include statements regarding the sufficiency of existing collateral to cover exposure related to nonperforming loans, and the strength of our balance sheet. Forward-looking statements are made based on management's expectations and beliefs concerning future events impacting the Company and are subject to uncertainties and factors relating to the Company's operations and economic environment, all of which are difficult to predict and many of which are beyond the control of the Company, that could cause actual results of the Company to differ materially from those expressed and/or implied by forward-looking statements and historical performance. The following factors, in addition to those listed as Risk Factors in Item 1A in our Annual Reports on Form 10-K and our Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission are among those that could cause actual results to differ materially from the forward-looking statements: changes in general economic, market and regulatory conditions; our ability to attract and retain deposits and other sources of liquidity; gross domestic product growth and inflation trends; the impact of the interest rate and inflationary environment on the Company's business, financial condition and results of operations; other income or cash flow anticipated from the Company's operations, investment and/or lending activities; changes in laws and regulations affecting banks, bank holding companies and/or financial holding companies, including the Dodd-Frank Act, and state and local government mandates; the impact of any change in the FDIC insurance assessment rate or the rules and regulations related to the calculation of the FDIC insurance assessment amount; technological developments and changes; cybersecurity incidents and threats; the ability to continue to introduce competitive new products and services on a timely, cost-effective basis; governmental and public policy changes, including environmental regulation; reliance on large customers; the ability to access financial resources in the amounts, at the times, and on the terms required to support the Company's future businesses; and the economic impact of national and global events, including the response to bank failures, war and geopolitical matters (including the war in Israel and potential for broader regional conflict and the war in Ukraine), widespread protests, civil unrest, political uncertainty, and pandemics or other public health crises. The Company does not undertake any obligation to update its forward-looking statements.

TOMPKINS FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF CONDITION
(In thousands, except share and per share data) (Unaudited)	As of	As of
ASSETS	06/30/2024	12/31/2023
		(Audited)
Cash and noninterest bearing balances due from banks	$	60,337		$	67,212
Interest bearing balances due from banks		10,578			12,330
Cash and Cash Equivalents		70,915			79,542
Available-for-sale debt securities, at fair value (amortized cost of $1,463,965 at June 30, 2024 and $1,548,482 at December 31, 2023)		1,317,458			1,416,650
Held-to-maturity debt securities, at amortized cost (fair value of $264,588 at June 30, 2024 and $267,455 at December 31, 2023)		312,430			312,401
Equity securities, at fair value		766			787
Total loans and leases, net of unearned income and deferred costs and fees		5,761,864			5,605,935
Less: Allowance for credit losses		53,059			51,584
Net Loans and Leases		5,708,805			5,554,351
Federal Home Loan Bank and other stock		41,382			33,719
Bank premises and equipment, net		77,279			79,687
Corporate owned life insurance		75,453			67,884
Goodwill		92,602			92,602
Other intangible assets, net		2,193			2,327
Accrued interest and other assets		170,239			179,799
Total Assets	$	7,869,522		$	7,819,749
LIABILITIES
Deposits:
Interest bearing:
Checking, savings and money market		3,453,049			3,484,878
Time		979,292			998,013
Noninterest bearing		1,853,555			1,916,956
Total Deposits		6,285,896			6,399,847
Federal funds purchased and securities sold under agreements to repurchase		35,989			50,996
Other borrowings		773,627			602,100
Other liabilities		97,917			96,872
Total Liabilities	$	7,193,429		$	7,149,815
EQUITY
Tompkins Financial Corporation shareholders' equity:
Common Stock - par value $.10 per share: Authorized 25,000,000 shares; Issued: 14,429,124 at June 30, 2024; and 14,441,830 at December 31, 2023		1,443			1,444
Additional paid-in capital		298,647			297,183
Retained earnings		516,566			501,510
Accumulated other comprehensive loss		(135,670	)		(125,005	)
Treasury stock, at cost - 126,450 shares at June 30, 2024, and 132,097 shares at December 31, 2023		(6,356	)		(6,610	)
Total Tompkins Financial Corporation Shareholders' Equity		674,630			668,522
Noncontrolling interests		1,463			1,412
Total Equity	$	676,093		$	669,934
Total Liabilities and Equity	$	7,869,522		$	7,819,749

TOMPKINS FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data) (Unaudited)	Three Months Ended	Six Months Ended
	06/30/2024	03/31/2024	06/30/2023	06/30/2024	06/30/2023
INTEREST AND DIVIDEND INCOME
Loans	$	73,646		$	71,599		$	63,527		$	145,245		$	124,369
Due from banks		184			154			183			338			322
Available-for-sale debt securities		9,371			9,611			6,618			18,982			13,361
Held-to-maturity debt securities		1,219			1,218			1,219			2,437			2,433
Federal Home Loan Bank and other stock		820			601			323			1,421			623
Total Interest and Dividend Income		85,240		$	83,183		$	71,870		$	168,423		$	141,108
INTEREST EXPENSE
Time certificates of deposits of $250,000 or more		4,048			4,010			2,526			8,058			4,313
Other deposits		21,236			20,424			13,119			41,660			23,513
Federal funds purchased and securities sold under agreements to repurchase		11			13			15			24			29
Other borrowings		8,992			8,061			4,314			17,053			7,111
Total Interest Expense		34,287			32,508			19,974			66,795			34,966
Net Interest Income		50,953			50,675			51,896			101,628			106,142
Less: Provision for credit loss expense		2,172			854			2,253			3,026			1,428
Net Interest Income After Provision for Credit Loss Expense		48,781			49,821			49,643			98,602			104,714
NONINTEREST INCOME
Insurance commissions and fees		9,087			10,259			8,672			19,346			18,181
Wealth management fees		4,849			4,937			4,678			9,786			9,187
Service charges on deposit accounts		1,766			1,796			1,640			3,562			3,386
Card services income		3,278			2,939			3,087			6,217			5,769
Other income		2,802			2,220			1,603			5,022			3,544
Net loss on securities transactions		(6	)		(14	)		(7,065	)		(20	)		(7,052	)
Total Noninterest Income		21,776			22,137			12,615			43,913			33,015
NONINTEREST EXPENSE
Salaries and wages		24,919			24,697			25,337			49,616			49,849
Other employee benefits		6,545			6,411			6,647			12,956			13,388
Net occupancy expense of premises		3,139			3,557			3,327			6,696			6,626
Furniture and fixture expense		1,910			2,125			2,105			4,035			4,159
Amortization of intangible assets		80			76			84			156			167
Other operating expense		13,349			12,991			14,468			26,340			27,937
Total Noninterest Expenses		49,942			49,857			51,968			99,799			102,126
Income Before Income Tax Expense		20,615			22,101			10,290			42,716			35,603
Income Tax Expense		4,902			5,198			1,784			10,100			7,685
Net Income Attributable to Noncontrolling Interests and Tompkins Financial Corporation		15,713			16,903			8,506			32,616			27,918
Less: Net Income Attributable to Noncontrolling Interests		31			31			31			62			62
Net Income Attributable to Tompkins Financial Corporation	$	15,682			16,872			8,475			32,554			27,856
Basic Earnings Per Share	$	1.10		$	1.19		$	0.59		$	2.29		$	1.94
Diluted Earnings Per Share	$	1.10		$	1.18		$	0.59		$	2.29		$	1.94

Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited)
	Quarter Ended	Quarter Ended
	June 30, 2024	March 31, 2024
	Average			Average
	Balance		Average	Balance		Average
(Dollar amounts in thousands)	(QTD)	Interest	Yield/Rate	(QTD)	Interest	Yield/Rate
ASSETS
Interest-earning assets
Interest-bearing balances due from banks	$	11,707	$	184		6.33	%	$	12,202	$	154		5.08	%
Securities (1)
U.S. Government securities		1,717,975		10,067		2.36	%		1,756,122		10,303		2.36	%
State and municipal (2)		89,518		566		2.55	%		89,886		570		2.55	%
Other securities		3,260		59		7.32	%		3,278		60		7.32	%
Total securities		1,810,753		10,692		2.38	%		1,849,286		10,933		2.38	%
FHLBNY and FRB stock		37,681		820		8.76	%		34,613		601		6.99	%
Total loans and leases, net of unearned income (2)(3)		5,687,548		73,839		5.22	%		5,621,604		71,779		5.14	%
Total interest-earning assets		7,547,689		85,535		4.56	%		7,517,705		83,467		4.47	%
Other assets		262,372				283,420
Total assets	$	7,810,061			$	7,801,125
LIABILITIES & EQUITY
Deposits
Interest-bearing deposits
Interest bearing checking, savings, & money market		3,498,746		15,754		1.81	%		3,546,216		15,036		1.71	%
Time deposits		987,348		9,530		3.88	%		988,891		9,398		3.82	%
Total interest-bearing deposits		4,486,094		25,284		2.27	%		4,535,107		24,434		2.17	%
Federal funds purchased & securities sold under agreements to repurchase		40,298		11		0.11	%		48,779		13		0.10	%
Other borrowings		688,611		8,992		5.25	%		622,951		8,061		5.21	%
Total interest-bearing liabilities		5,215,003		34,287		2.64	%		5,206,836		32,508		2.51	%
Noninterest bearing deposits		1,837,325				1,831,244
Accrued expenses and other liabilities		94,764				96,292
Total liabilities		7,147,092				7,134,373
Tompkins Financial Corporation Shareholders' equity		661,523				665,333
Noncontrolling interest		1,446				1,419
Total equity		662,969				666,752
Total liabilities and equity	$	7,810,061			$	7,801,125
Interest rate spread			1.91	%			1.95	%
Net interest income (TE)/margin on earning assets			51,248		2.73	%			50,959		2.73	%
Tax Equivalent Adjustment			(295	)				(284	)
Net interest income		$	50,953				$	50,675

Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited)
	Quarter Ended	Quarter Ended
	June 30, 2024	June 30, 2023
	Average			Average
	Balance		Average	Balance		Average
(Dollar amounts in thousands)	(QTD)	Interest	Yield/Rate	(QTD)	Interest	Yield/Rate
ASSETS
Interest-earning assets
Interest-bearing balances due from banks	$	11,707	$	184		6.33	%	$	13,585	$	183		5.40	%
Securities (1)
U.S. Government securities		1,717,975		10,067		2.36	%		1,972,719		7,304		1.49	%
State and municipal (2)		89,518		566		2.55	%		92,194		590		2.57	%
Other securities		3,260		59		7.32	%		3,288		56		6.86	%
Total securities		1,810,753		10,692		2.38	%		2,068,201		7,950		1.54	%
FHLBNY and FRB stock		37,681		820		8.76	%		23,211		323		5.59	%
Total loans and leases, net of unearned income (2)(3)		5,687,548		73,839		5.22	%		5,304,717		63,709		4.82	%
Total interest-earning assets		7,547,689		85,535		4.56	%		7,409,714		72,165		3.91	%
Other assets		262,372				226,086
Total assets	$	7,810,061			$	7,635,800
LIABILITIES & EQUITY
Deposits
Interest-bearing deposits
Interest bearing checking, savings, & money market	$	3,498,746	$	15,754		1.81	%	$	3,701,229	$	10,590		1.15	%
Time deposits		987,348		9,530		3.88	%		745,970		5,055		2.72	%
Total interest-bearing deposits		4,486,094		25,284		2.27	%		4,447,199		15,645		1.41	%
Federal funds purchased & securities sold under agreements to repurchase		40,298		11		0.11	%		56,083		15		0.11	%
Other borrowings		688,611		8,992		5.25	%		379,744		4,314		4.56	%
Total interest-bearing liabilities		5,215,003		34,287		2.64	%		4,883,026		19,974		1.64	%
Noninterest bearing deposits		1,837,325				2,004,560
Accrued expenses and other liabilities		94,764				97,660
Total liabilities		7,147,092				6,985,246
Tompkins Financial Corporation Shareholders' equity		661,523				649,097
Noncontrolling interest		1,446				1,457
Total equity		662,969				650,554
Total liabilities and equity	$	7,810,061			$	7,635,800
Interest rate spread			1.91	%			2.27	%
Net interest income (TE)/margin on earning assets			51,248		2.73	%			52,191		2.83	%
Tax Equivalent Adjustment			(295	)				(295	)
Net interest income		$	50,953				$	51,896

Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited)
	Year to Date Period Ended	Year to Date Period Ended
	June 30, 2024	June 30, 2023
	Average			Average
	Balance		Average	Balance		Average
(Dollar amounts in thousands)	(YTD)	Interest	Yield/Rate	(YTD)	Interest	Yield/Rate
ASSETS
Interest-earning assets
Interest-bearing balances due from banks	$	11,955	$	338		5.69	%	$	13,161	$	322		4.93	%
Securities (1)
U.S. Government securities		1,737,049		20,370		2.36	%		2,002,846		14,728		1.48	%
State and municipal (2)		89,702		1,137		2.55	%		92,695		1,188		2.58	%
Other securities		3,269		119		7.32	%		3,286		110		6.70	%
Total securities		1,830,020		21,626		2.38	%		2,098,827		16,026		1.54	%
FHLBNY and FRB stock		36,147		1,421		7.90	%		19,998		623		6.29	%
Total loans and leases, net of unearned income (2)(3)		5,654,576		145,616		5.18	%		5,278,145		124,744		4.77	%
Total interest-earning assets		7,532,698		169,001		4.51	%		7,410,131		141,715		3.86	%
Other assets		272,895				224,671
Total assets	$	7,805,593			$	7,634,802
LIABILITIES & EQUITY
Deposits
Interest-bearing deposits
Interest bearing checking, savings, & money market	$	3,522,481	$	30,790		1.76	%	$	3,767,032	$	19,230		1.03	%
Time deposits		988,119		18,928		3.85	%		710,119		8,596		2.44	%
Total interest-bearing deposits		4,510,600		49,718		2.22	%		4,477,151		27,826		1.25	%
Federal funds purchased & securities sold under agreements to repurchase		44,538		24		0.11	%		56,799		29		0.10	%
Other borrowings		655,781		17,053		5.23	%		325,052		7,111		4.41	%
Total interest-bearing liabilities		5,210,919		66,795		2.58	%		4,859,002		34,966		1.45	%
Noninterest bearing deposits		1,834,284				2,034,961
Accrued expenses and other liabilities		95,529				99,905
Total liabilities		7,140,732				6,993,868
Tompkins Financial Corporation Shareholders' equity		663,428				639,494
Noncontrolling interest		1,433				1,440
Total equity		664,861				640,934
Total liabilities and equity	$	7,805,593			$	7,634,802
Interest rate spread			1.93	%			2.41	%
Net interest income (TE)/margin on earning assets			102,206		2.73	%			106,749		2.90	%
Tax Equivalent Adjustment			(578	)				(607	)
Net interest income		$	101,628				$	106,142

Tompkins Financial Corporation - Summary Financial Data (Unaudited)

(In thousands, except per share data)
	Quarter-Ended	Year-Ended
Period End Balance Sheet	Jun-24	Mar-24	Dec-23	Sep-23	Jun-23	Dec-23
Securities	$	1,630,654	$	1,679,542	$	1,729,838	$	1,701,636	$	1,781,150	$	1,729,838
Total Loans		5,761,864		5,640,524		5,605,935		5,434,860		5,352,365		5,605,935
Allowance for credit losses		53,059		51,704		51,584		49,336		48,545		51,584
Total assets		7,869,522		7,778,034		7,819,749		7,691,162		7,626,238		7,819,749
Total deposits		6,285,896		6,449,616		6,399,847		6,623,436		6,454,651		6,399,847
Federal funds purchased and securities sold under agreements to repurchase		35,989		43,681		50,996		56,120		50,483		50,996
Other borrowings		773,627		522,600		602,100		296,800		387,100		602,100
Total common equity		674,630		667,906		668,522		610,851		634,967		668,522
Total equity		676,093		669,338		669,934		612,356		636,441		669,934

Average Balance Sheet
Average earning assets	$	7,547,689	$	7,517,705	$	7,407,976	$	7,405,434	$	7,409,714	$	7,408,404
Average assets		7,810,061		7,801,125		7,666,982		7,629,876		7,635,800		7,641,672
Average interest-bearing liabilities		5,215,003		5,206,836		5,020,544		4,902,930		4,883,026		4,910,792
Average equity		662,969		666,752		622,280		634,980		650,554		634,732

Share data
Weighted average shares outstanding (basic)		14,214,574		14,211,910		14,194,503		14,185,763		14,314,133		14,254,661
Weighted average shares outstanding (diluted)		14,239,626		14,238,357		14,246,024		14,224,748		14,346,787		14,301,221
Period-end shares outstanding		14,395,204		14,405,019		14,405,920		14,350,177		14,405,503		14,405,920
Common equity book value per share	$	46.86	$	46.37	$	46.41	$	42.57	$	44.08	$	46.41
Tangible book value per share (Non-GAAP)**	$	40.35	$	39.85	$	39.88	$	36.01	$	37.54	$	39.88
**See "Non-GAAP measures" below for a discussion of non-GAAP financial measures and a reconciliation of non-GAAP financial measures to the most directly comparable financial measures presented in accordance with GAAP.

Income Statement
Net interest income	$	50,953	$	50,675	$	52,359	$	51,013		$	51,896	$	209,514
Provision for credit loss expense (5)		2,172		854		1,761		1,150			2,253		4,339
Noninterest income		21,776		22,137		18,850		(41,624	)		12,615		10,241
Noninterest expense (5)		49,942		49,857		51,300		49,866			51,968		203,292
Income tax expense/(benefit)		4,902		5,198		3,114		(8,304	)		1,784		2,495
Net income/(loss) attributable to Tompkins Financial Corporation		15,682		16,872		15,003		(33,354	)		8,475		9,505
Noncontrolling interests		31		31		31		31			31		124
Basic earnings (loss) per share (4)		1.10		1.19		1.06		(2.35	)		0.59		0.66
Diluted earnings (loss) per share (4)		1.10		1.18		1.05		(2.35	)		0.59		0.66

Nonperforming Assets
Nonaccrual loans and leases	$	62,253	$	62,544	$	62,165	$	31,381	$	31,333	$	62,165
Loans and leases 90 days past due and accruing		215		151		101		52		34		101
Total nonperforming loans and leases		62,468		62,695		62,266		31,433		31,367		62,266
OREO		80		0		131		0		36		131
Total nonperforming assets	$	62,548	$	62,695	$	62,397	$	31,433	$	31,403	$	62,397

Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued

	Quarter-Ended	Year-Ended
Delinquency - Total loan and lease portfolio	Jun-24	Mar-24	Dec-23	Sep-23	Jun-23	Dec-23
Loans and leases 30-89 days past due and accruing	$	5,286	$	8,015	$	4,210	$	40,893	$	20,255	$	4,210
Loans and leases 90 days past due and accruing		215		151		101		52		34		101
Total loans and leases past due and accruing		5,501		8,166		4,311		40,945		20,289		4,311

Allowance for Credit Losses
Balance at beginning of period	$	51,704	$	51,584	$	49,336		$	48,545	$	46,099		$	45,934
Impact of adopting ASC 326		0		0		0			0		0			64
Provision for credit losses		1,864		348		2,658			968		2,419		$	4,865
Net loan and lease charge-offs (recoveries)		509		228		410			177		(27	)	$	(721	)
Allowance for credit losses at end of period	$	53,059	$	51,704	$	51,584		$	49,336	$	48,545		$	51,584
Allowance for Credit Losses - Off-Balance Sheet Exposure
Balance at beginning of period	$	2,776	$	2,270	$	3,167		$	2,985	$	3,151		$	2,796
Provision (credit) for credit losses		308		506		(897	)		182		(166	)	$	(526	)
Allowance for credit losses at end of period	$	3,084	$	2,776	$	2,270		$	3,167	$	2,985		$	2,270

Loan Classification - Total Portfolio
Special Mention	$	48,712	$	46,302	$	50,368	$	65,993	$	56,305	$	50,368
Substandard		67,509		72,412		72,717		56,947		61,820		72,717

Ratio Analysis

Credit Quality
Nonperforming loans and leases/total loans and leases	1.08	%	1.11	%	1.11	%	0.58	%	0.59	%	1.11	%
Nonperforming assets/total assets	0.79	%	0.81	%	0.80	%	0.41	%	0.41	%	0.80	%
Allowance for credit losses/total loans and leases	0.92	%	0.92	%	0.92	%	0.91	%	0.91	%	0.92	%
Allowance/nonperforming loans and leases	84.94	%	82.47	%	82.84	%	156.96	%	154.76	%	82.84	%
Net loan and lease losses (recoveries) annualized/total average loans and leases	0.04	%	0.02	%	0.03	%	0.01	%	0.00	%	(0.01	)%

Capital Adequacy
Tier 1 Capital (to average assets)	9.15	%	9.08	%	9.08	%	9.01	%	9.57	%	9.08	%
Total Capital (to risk-weighted assets)	13.26	%	13.43	%	13.36	%	13.46	%	14.48	%	13.36	%

Profitability (period-end)
Return on average assets *	0.81	%	0.87	%	0.78	%	(1.73	)%	0.45	%	0.12	%
Return on average equity *	9.51	%	10.18	%	9.56	%	(20.84	)%	5.22	%	1.50	%
Net interest margin (TE) *	2.73	%	2.73	%	2.82	%	2.75	%	2.83	%	2.84	%
Average yield on interest-earning assets*	4.56	%	4.47	%	4.34	%	4.06	%	3.91	%	4.03	%
Average cost of deposits*	1.61	%	1.54	%	1.43	%	1.20	%	0.97	%	1.09	%
Average cost of funds*	1.96	%	1.86	%	1.62	%	1.41	%	1.16	%	1.27	%
* Quarterly ratios have been annualized

Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued

Non-GAAP Measures

This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principals (GAAP). Where non-GAAP disclosures are used in this press release, the comparable GAAP measure, as well as reconciliation to the comparable GAAP measure, is provided in the below tables. The Company believes the non-GAAP measures provide meaningful comparisons of our underlying operational performance and facilitate management's and investors' assessments of business and performance trends in comparison to others in the financial services industry. These non-GAAP financial measures should not be considered in isolation or as a measure of the Company's profitability or liquidity; they are in addition to, and are not a substitute for, financial measures under GAAP. The non-GAAP financial measures presented herein may be different from non-GAAP financial measures used by other companies, and may not be comparable to similarly titled measures reported by other companies. Further, the Company may utilize other measures to illustrate performance in the future. Non-GAAP financial measures have limitations since they do not reflect all of the amounts associated with the Company's results of operations as determined in accordance with GAAP.

Reconciliation of Tangible Book Value Per Share (non-GAAP) to Common Equity Book Value Per Share (GAAP)
	Quarter-Ended	Year-Ended
	Jun-24	Mar-24	Dec-23	Sep-23	Jun-23	Dec-23
Total common equity	$	674,630	$	667,906	$	668,522	$	610,851	$	634,967	$	668,522
Less: Goodwill and intangibles		93,847		93,926		94,003		94,086		94,169		94,003
Tangible common equity (Non-GAAP)		580,783		573,980		574,519		516,765		540,798		574,519
Ending shares outstanding		14,395,204		14,405,019		14,405,920		14,350,177		14,405,503		14,405,920
Tangible book value per share (Non-GAAP)	$	40.35	$	39.85	$	39.88	$	36.01	$	37.54	$	39.88

(1) Average balances and yields on available-for-sale securities are based on historical amortized cost.
(2) Interest income includes the tax effects of taxable-equivalent adjustments using an effective income tax rate of 21% in 2024 and 2023 to increase tax exempt interest income to taxable-equivalent basis.
(3) Nonaccrual loans are included in the average asset totals presented above. Payments received on nonaccrual loans have been recognized as disclosed in Note 1 of the Company's consolidated financial statements included in Part I of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2023.
(4) Earnings per share for the full fiscal year may not equal the sum of the quarterly earnings per share as a result of rounding of average shares.
(5) Amounts in prior periods' financial statements are reclassified when necessary to conform to the current period's presentation.

Source: Tompkins Financial Corporation