GLENS FALLS, N.Y.,
July 22, 2019 /PRNewswire/ -- Arrow Financial Corporation
(NasdaqGS® – AROW) announced operating results for the three-month
period ended June 30, 2019. Net income for the second quarter
of 2019 was $8.9 million, compared to
$9.7 million in the second quarter of
2018. Steady loan growth continued in the second quarter of 2019,
as total loans grew by $45.1 million
from March 31, 2019 to $2.3
billion. Driven primarily by this growth, net interest
income increased to $21.7 million in
the second quarter of 2019, compared to $21.0 million for the comparable quarter of
2018.
Annualized key profitability ratios remained strong, as measured
by a return on average equity of 12.79% and a return on average
assets of 1.20% for the second quarter, compared to 15.22% and
1.38%, respectively, a year earlier.
"Thanks to the efforts of our team, Arrow continued its solid
performance with steady loan growth and strong asset quality
through the second quarter of the year," said President and CEO
Thomas J. Murphy. "Our Company is
well-positioned to adapt to the continuing changes in a complex
rate environment. Additionally, we are making strategic lending
decisions within our communities that will help our region thrive,
and we are making important investments that will help us provide
an enhanced customer experience."
The Company continued its forward momentum and expansion in the
Capital Region with the opening of a new Saratoga National Bank and
Trust Company office in Rotterdam, New
York in the second quarter. Additionally, the company
announced plans for the opening of its
12th Saratoga National Bank office, in Latham, New York, anticipated in early
2020.
The following expands on our second-quarter results:
Cash Dividend: On June 14,
2019, the Company distributed a cash dividend of
$0.26 per share. The June 14, 2019 cash dividend was 7.1% higher than
the $0.25 cash dividend paid by the
Company in the second quarter of 2018, when adjusted for the 3%
stock dividend distributed on September 27,
2018. The 2018 increase from $0.25 per share to $0.26 per share was the first increase in per
share dividend amount since 2008.
Loan Growth: Total loans reached $2.3 billion as of June 30, 2019, which
represents an increase of $222.4
million, or 10.8% as compared to June 30, 2018. The
consumer loan portfolio grew by $117.1
million, or 17.7%, as compared to June 30, 2018,
primarily within the indirect automobile lending program. The total
residential real estate loan portfolio increased $60.0 million, or 7.4%, as compared to
June 30, 2018. Total outstanding commercial loans increased
$45.3 million, or 7.8%, as compared
to June 30, 2018.
Deposit Growth: At June 30, 2019, deposit
balances reached $2.5 billion, up
$199.0 million, or 8.6%, from the
prior-year level. Noninterest-bearing deposits represented 18.7% of
total deposits at June 30, 2019. At June 30, 2019, other
time deposits were $289.3 million, an
increase of $119.7 million compared
to the prior year. Time deposits include brokered deposits acquired
to diversify source of funds to more favorable rates as compared to
other borrowings.
Net Interest Income: Driven by strong loan
growth, second quarter 2019 net interest income increased to
$21.7 million, up 3.6% from
$21.0 million in the comparable
quarter of 2018. The net interest margin was 3.04% for the quarter,
compared to 3.11% for the second quarter of 2018. The decrease in
net interest margin from the prior year was the result of the
migration to higher yielding deposit accounts due to rise in
short-term market rates.
Noninterest Income: Noninterest income for the three
months ended June 30, 2019, was $6.9 million, compared to $7.9 million in the comparable 2018 quarter.
Despite the decline from the prior year, total noninterest income
represented 24.1% of total revenues in the second quarter of
2019.
Noninterest Expense: Noninterest expense for the
second quarter of 2019 increased 4.4% to $16.9 million, from $16.2
million for the second quarter of 2018. Technology and
equipment expense increased $394
thousand, and other operating expense increased $409 thousand from the comparable quarter in
2018.
Provision for Income Taxes: The provision for income
taxes was $2.3 million for the second
quarter of both 2019 and 2018. The effective income tax rates for
the three-month periods ended June 30, 2019 and 2018 were
20.5% and 19.3%, respectively.
Asset Quality: Asset quality remained strong at
June 30, 2019, with continued low levels of nonperforming
loans and net charge-offs. Nonperforming loans at June 30,
2019, were $5.5 million,
up $26.0 thousand from the level at December 31,
2018. Net charge-offs, expressed as an annualized percentage of
average loans outstanding, were 0.02% for the three-month period
ended June 30, 2019, up from the prior-year comparable quarter
of 0.01%. The allowance for loan losses was $20.7 million at June 30, 2019, which
represented 0.91% of loans outstanding, as compared to 0.95% at
June 30, 2018. The loss provision expense for the second
quarter of 2019 was $455 thousand,
down $174 thousand from the provision
for the comparable 2018 quarter.
Capital: Total stockholders' equity was a
record $284.6 million at
June 30, 2019, up $25.2 million,
or 9.7%, from the comparable quarter of 2018. Overall regulatory
capital ratios also remained strong in 2019, with the Company's
common equity tier 1 ratio estimated to be 12.99% and the total
risk-based capital ratio estimated to be 14.91% at June 30,
2019. These capital levels at the Company and both its subsidiary
banks continue to significantly exceed the "well capitalized"
regulatory standard.
Industry Recognition: Both of the Company's banking
subsidiaries maintained their BauerFinancial, Inc. 5-Star Superior
Bank rating. Glens Falls National Bank and Trust Company and
Saratoga National Bank and Trust Company have continued to earn
this designation for the last 49 and 41 quarters, respectively. In
May, Seifried & Brew named Glens Falls National and Saratoga
National to the top 15th percentile of Community Banks based on
their performance in 2018.
About Arrow: Arrow Financial Corporation is a
multi-bank holding company headquartered in Glens Falls, New York, serving the financial
needs of northeastern New York.
The Company is the parent of Glens Falls National Bank and Trust
Company and Saratoga National Bank and Trust Company. Other
subsidiaries include North Country Investment Advisers, Inc. and
Upstate Agency, LLC.
Non-GAAP Financial Measures Reconciliation: In
addition to presenting information in conformity with accounting
principles generally accepted in the
United States of America (GAAP), this news release contains
financial information determined by methods other than GAAP
(non-GAAP). The following measures used in this release, which are
commonly utilized by financial institutions, have not been
specifically exempted by the Securities and Exchange Commission
("SEC") and may constitute "non-GAAP financial measures" within the
meaning of the SEC's rules. Certain non-GAAP financial measures
include: tangible equity, return on tangible equity, tax-equivalent
adjustment and related net interest income, tax-equivalent, and the
efficiency ratio. Management believes that the non-GAAP financial
measures disclosed by the Company from time to time are useful in
evaluating the Company's performance and that such information
should be considered as supplemental in nature and not as a
substitute for or superior to the related financial information
prepared in accordance with GAAP. Non-GAAP financial
measures may differ from similar measures presented by other
companies. See the reconciliation of GAAP to non-GAAP measures in
the section "Selected Quarterly Information."
Safe Harbor Statement: The information contained in
this news release may contain statements that are not historical in
nature but rather are based on management's beliefs, assumptions,
expectations, estimates and projections about the future. These
statements may be "forward-looking statements" within the meaning
of Section 21E of the Securities Exchange Act of 1934, as amended,
involving a degree of uncertainty and attendant risk. In the case
of all forward-looking statements, actual outcomes and results may
differ materially from what the statements predict or forecast,
explicitly or by implication. The Company undertakes no obligation
to revise or update these forward-looking statements to reflect the
occurrence of unanticipated events. This News Release should be
read in conjunction with the Company's Annual Report on Form 10-K
for the year ended December 31, 2018, and other filings with
the Securities and Exchange Commission.
250 Glen Street
Glens Falls, NY 12801
NASDAQ® Symbol: "AROW"
Website: arrowfinancial.com
ARROW FINANCIAL
CORPORATION AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF INCOME
(In Thousands, Except
Per Share Amounts - Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended June
30,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
INTEREST AND
DIVIDEND INCOME
|
|
|
|
|
|
|
|
|
Interest and Fees on
Loans
|
|
$
|
23,520
|
|
|
$
|
19,909
|
|
|
$
|
45,923
|
|
|
$
|
38,767
|
|
Interest on Deposits
at Banks
|
|
195
|
|
|
158
|
|
|
390
|
|
|
292
|
|
Interest and
Dividends on Investment Securities:
|
|
|
|
|
|
|
|
|
Fully
Taxable
|
|
2,284
|
|
|
2,048
|
|
|
4,653
|
|
|
3,941
|
|
Exempt from Federal
Taxes
|
|
1,228
|
|
|
1,475
|
|
|
2,474
|
|
|
3,008
|
|
Total Interest and
Dividend Income
|
|
27,227
|
|
|
23,590
|
|
|
53,440
|
|
|
46,008
|
|
INTEREST
EXPENSE
|
|
|
|
|
|
|
|
|
Interest-Bearing
Checking Accounts
|
|
453
|
|
|
388
|
|
|
935
|
|
|
775
|
|
Savings
Deposits
|
|
2,008
|
|
|
711
|
|
|
3,609
|
|
|
1,233
|
|
Time Deposits over
$250,000
|
|
515
|
|
|
328
|
|
|
911
|
|
|
532
|
|
Other Time
Deposits
|
|
1,131
|
|
|
282
|
|
|
1,844
|
|
|
541
|
|
Federal Funds
Purchased and
Securities Sold Under Agreements to Repurchase
|
|
25
|
|
|
16
|
|
|
47
|
|
|
32
|
|
Federal Home Loan
Bank Advances
|
|
1,099
|
|
|
656
|
|
|
2,693
|
|
|
1,070
|
|
Junior Subordinated
Obligations Issued to
Unconsolidated Subsidiary Trusts
|
|
261
|
|
|
247
|
|
|
530
|
|
|
461
|
|
Interest on Financing
Leases
|
|
28
|
|
|
—
|
|
|
43
|
|
|
—
|
|
Total Interest
Expense
|
|
5,520
|
|
|
2,628
|
|
|
10,612
|
|
|
4,644
|
|
NET INTEREST
INCOME
|
|
21,707
|
|
|
20,962
|
|
|
42,828
|
|
|
41,364
|
|
Provision for Loan
Losses
|
|
455
|
|
|
629
|
|
|
927
|
|
|
1,375
|
|
NET INTEREST
INCOME AFTER PROVISION FOR
LOAN LOSSES
|
|
21,252
|
|
|
20,333
|
|
|
41,901
|
|
|
39,989
|
|
NONINTEREST
INCOME
|
|
|
|
|
|
|
|
|
Income From Fiduciary
Activities
|
|
2,252
|
|
|
2,647
|
|
|
4,359
|
|
|
4,844
|
|
Fees for Other
Services to Customers
|
|
2,545
|
|
|
2,570
|
|
|
4,947
|
|
|
4,950
|
|
Insurance
Commissions
|
|
1,935
|
|
|
2,192
|
|
|
3,654
|
|
|
4,095
|
|
Net Gain on
Securities Transactions
|
|
—
|
|
|
223
|
|
|
76
|
|
|
241
|
|
Net Gain on Sales of
Loans
|
|
140
|
|
|
23
|
|
|
244
|
|
|
61
|
|
Other Operating
Income
|
|
24
|
|
|
256
|
|
|
503
|
|
|
609
|
|
Total Noninterest
Income
|
|
6,896
|
|
|
7,911
|
|
|
13,783
|
|
|
14,800
|
|
NONINTEREST
EXPENSE
|
|
|
|
|
|
|
|
|
Salaries and Employee
Benefits
|
|
9,727
|
|
|
9,812
|
|
|
19,046
|
|
|
19,181
|
|
Occupancy Expenses,
Net
|
|
1,279
|
|
|
1,270
|
|
|
2,699
|
|
|
2,610
|
|
Technology and
Equipment Expense
|
|
3,243
|
|
|
2,849
|
|
|
6,384
|
|
|
5,547
|
|
FDIC
Assessments
|
|
212
|
|
|
223
|
|
|
424
|
|
|
440
|
|
Other Operating
Expense
|
|
2,447
|
|
|
2,038
|
|
|
5,007
|
|
|
4,370
|
|
Total Noninterest
Expense
|
|
16,908
|
|
|
16,192
|
|
|
33,560
|
|
|
32,148
|
|
INCOME BEFORE
PROVISION FOR INCOME TAXES
|
|
11,240
|
|
|
12,052
|
|
|
22,124
|
|
|
22,641
|
|
Provision for Income
Taxes
|
|
2,306
|
|
|
2,322
|
|
|
4,456
|
|
|
4,380
|
|
NET
INCOME
|
|
$
|
8,934
|
|
|
$
|
9,730
|
|
|
$
|
17,668
|
|
|
$
|
18,261
|
|
Average Shares
Outstanding 1:
|
|
|
|
|
|
|
|
|
Basic
|
|
14,487
|
|
|
14,394
|
|
|
14,478
|
|
|
14,374
|
|
Diluted
|
|
14,527
|
|
|
14,480
|
|
|
14,523
|
|
|
14,459
|
|
Per Common
Share:
|
|
|
|
|
|
|
|
|
Basic
Earnings
|
|
$
|
0.62
|
|
|
$
|
0.68
|
|
|
$
|
1.22
|
|
|
$
|
1.27
|
|
Diluted
Earnings
|
|
0.62
|
|
|
0.67
|
|
|
1.22
|
|
|
1.26
|
|
1 2018 Share and Per Share Amounts
have been restated for the September 27, 2018, 3% stock
dividend.
|
|
|
|
|
ARROW FINANCIAL
CORPORATION AND SUBSIDIARIES
CONSOLIDATED
BALANCE SHEETS
(In Thousands, Except
Share and Per Share Amounts - Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
2019
|
|
December 31,
2018
|
|
June 30,
2018
|
ASSETS
|
|
|
|
|
|
Cash and Due From
Banks
|
$
|
34,650
|
|
|
$
|
56,529
|
|
|
$
|
38,552
|
|
Interest-Bearing
Deposits at Banks
|
28,045
|
|
|
27,710
|
|
|
22,189
|
|
Investment
Securities:
|
|
|
|
|
|
Available-for-Sale
|
285,878
|
|
|
317,535
|
|
|
325,387
|
|
Held-to-Maturity
(Approximate Fair Value of $266,068 at June 30, 2019; $280,338 at
December 31, 2018; and $292,605 at June 30, 2018)
|
262,541
|
|
|
283,476
|
|
|
297,885
|
|
Equity
Securities
|
1,850
|
|
|
1,774
|
|
|
1,802
|
|
Other
Investments
|
8,202
|
|
|
15,506
|
|
|
11,089
|
|
Loans
|
2,280,308
|
|
|
2,196,215
|
|
|
2,057,862
|
|
Allowance for Loan
Losses
|
(20,695)
|
|
|
(20,196)
|
|
|
(19,640)
|
|
Net Loans
|
2,259,613
|
|
|
2,176,019
|
|
|
2,038,222
|
|
Premises and
Equipment, Net
|
38,836
|
|
|
30,446
|
|
|
28,104
|
|
Goodwill
|
21,873
|
|
|
21,873
|
|
|
21,873
|
|
Other Intangible
Assets, Net
|
1,730
|
|
|
1,852
|
|
|
2,060
|
|
Other
Assets
|
62,532
|
|
|
55,614
|
|
|
58,008
|
|
Total
Assets
|
$
|
3,005,750
|
|
|
$
|
2,988,334
|
|
|
$
|
2,845,171
|
|
LIABILITIES
|
|
|
|
|
|
Noninterest-Bearing
Deposits
|
$
|
467,179
|
|
|
$
|
472,768
|
|
|
$
|
467,048
|
|
Interest-Bearing
Checking Accounts
|
741,395
|
|
|
790,781
|
|
|
861,959
|
|
Savings
Deposits
|
908,642
|
|
|
818,048
|
|
|
735,217
|
|
Time Deposits over
$250,000
|
97,220
|
|
|
73,583
|
|
|
70,950
|
|
Other Time
Deposits
|
289,317
|
|
|
190,404
|
|
|
169,607
|
|
Total
Deposits
|
2,503,753
|
|
|
2,345,584
|
|
|
2,304,781
|
|
Federal Funds
Purchased and
Securities Sold
Under Agreements to Repurchase
|
51,149
|
|
|
54,659
|
|
|
60,248
|
|
Federal Home Loan
Bank Overnight Advances
|
83,000
|
|
|
234,000
|
|
|
136,000
|
|
Federal Home Loan
Bank Term Advances
|
30,000
|
|
|
45,000
|
|
|
45,000
|
|
Junior Subordinated
Obligations Issued to Unconsolidated
Subsidiary Trusts
|
20,000
|
|
|
20,000
|
|
|
20,000
|
|
Finance
Leases
|
5,270
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Other
Liabilities
|
27,929
|
|
|
19,507
|
|
|
19,654
|
|
Total
Liabilities
|
2,721,101
|
|
|
2,718,750
|
|
|
2,585,683
|
|
STOCKHOLDERS'
EQUITY
|
|
|
|
|
|
Preferred Stock, $1
Par Value and 1,000,000 Shares Authorized at June 30, 2019; $5 Par
Value and 1,000,000 Shares Authorized at December 31, 2018 and June
30, 2018
|
—
|
|
|
—
|
|
|
—
|
|
Common Stock, $1 Par
Value; 30,000,000 Shares Authorized at June 30, 2019 and 20,000,000
Shares Authorized at December 31, 2018 and June 30, 2018
(19,035,565 Shares Issued at June 30, 2019 and December 31, 2018
and 18,481,301 at June 30, 2018)
|
19,035
|
|
|
19,035
|
|
|
18,481
|
|
Additional Paid-in
Capital
|
316,229
|
|
|
314,533
|
|
|
292,020
|
|
Retained
Earnings
|
39,397
|
|
|
29,257
|
|
|
40,326
|
|
Unallocated ESOP
Shares (5,001 Shares at June 30, 2019; 5,001 Shares at December 31,
2018 and 9,643 Shares at June 30, 2018)
|
(100)
|
|
|
(100)
|
|
|
(200)
|
|
Accumulated Other
Comprehensive Loss
|
(9,647)
|
|
|
(13,810)
|
|
|
(11,804)
|
|
Treasury Stock, at
Cost (4,517,412 Shares at June 30, 2019; 4,558,207 Shares at
December 31, 2018 and 4,467,909 Shares at June 30, 2018)
|
(80,265)
|
|
|
(79,331)
|
|
|
(79,335)
|
|
Total Stockholders'
Equity
|
284,649
|
|
|
269,584
|
|
|
259,488
|
|
Total Liabilities and
Stockholders' Equity
|
$
|
3,005,750
|
|
|
$
|
2,988,334
|
|
|
$
|
2,845,171
|
|
Arrow Financial
Corporation
Selected Quarterly
Information
(Dollars In
Thousands, Except Per Share Amounts -
Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended
|
6/30/2019
|
|
|
3/31/2019
|
|
|
12/31/2018
|
|
|
9/30/2018
|
|
|
6/30/2018
|
|
Net Income
|
$
|
8,934
|
|
|
$
|
8,734
|
|
|
$
|
8,758
|
|
|
$
|
9,260
|
|
|
$
|
9,730
|
|
Transactions in
Net Income (Net of Tax):
|
|
|
|
|
|
|
|
|
|
Net Changes in Fair
Value of Equity Investments
|
—
|
|
|
57
|
|
|
(106)
|
|
|
85
|
|
|
166
|
|
|
|
|
|
|
|
|
|
|
|
Share and Per
Share Data:1
|
|
|
|
|
|
|
|
|
|
Period End Shares
Outstanding
|
14,513
|
|
|
14,474
|
|
|
14,472
|
|
|
14,441
|
|
|
14,424
|
|
Basic Average Shares
Outstanding
|
14,487
|
|
|
14,469
|
|
|
14,451
|
|
|
14,431
|
|
|
14,394
|
|
Diluted Average
Shares Outstanding
|
14,527
|
|
|
14,520
|
|
|
14,514
|
|
|
14,520
|
|
|
14,480
|
|
Basic Earnings Per
Share
|
$
|
0.62
|
|
|
$
|
0.60
|
|
|
$
|
0.61
|
|
|
$
|
0.64
|
|
|
$
|
0.68
|
|
Diluted Earnings Per
Share
|
0.62
|
|
|
0.60
|
|
|
0.60
|
|
|
0.64
|
|
|
0.67
|
|
Cash Dividend Per
Share
|
0.260
|
|
|
0.260
|
|
|
0.260
|
|
|
0.252
|
|
|
0.243
|
|
|
|
|
|
|
|
|
|
|
|
Selected Quarterly
Average Balances:
|
|
|
|
|
|
|
|
|
|
Interest-Bearing Deposits at Banks
|
$
|
25,107
|
|
|
$
|
26,163
|
|
|
$
|
34,782
|
|
|
$
|
30,522
|
|
|
$
|
28,543
|
|
Investment
Securities
|
584,679
|
|
|
611,161
|
|
|
637,341
|
|
|
636,847
|
|
|
647,913
|
|
Loans
|
2,255,299
|
|
|
2,210,642
|
|
|
2,160,435
|
|
|
2,089,651
|
|
|
2,026,598
|
|
Deposits
|
2,436,290
|
|
|
2,347,985
|
|
|
2,347,231
|
|
|
2,279,709
|
|
|
2,325,202
|
|
Other Borrowed
Funds
|
250,283
|
|
|
327,138
|
|
|
315,172
|
|
|
314,304
|
|
|
219,737
|
|
Shareholders'
Equity
|
280,247
|
|
|
272,864
|
|
|
268,503
|
|
|
263,139
|
|
|
256,358
|
|
Total
Assets
|
2,997,458
|
|
|
2,977,056
|
|
|
2,954,029
|
|
|
2,879,854
|
|
|
2,823,061
|
|
Return on Average
Assets, annualized
|
1.20
|
%
|
|
1.19
|
%
|
|
1.18
|
%
|
|
1.28
|
%
|
|
1.38
|
%
|
Return on Average
Equity, annualized
|
12.79
|
%
|
|
12.98
|
%
|
|
12.94
|
%
|
|
13.96
|
%
|
|
15.22
|
%
|
Return on Average
Tangible Equity, annualized 2
|
13.96
|
%
|
|
14.22
|
%
|
|
14.20
|
%
|
|
15.36
|
%
|
|
16.80
|
%
|
Average Earning
Assets
|
$
|
2,865,085
|
|
|
$
|
2,847,966
|
|
|
$
|
2,832,558
|
|
|
$
|
2,757,020
|
|
|
$
|
2,703,054
|
|
Average Paying
Liabilities
|
2,235,462
|
|
|
2,224,403
|
|
|
2,189,233
|
|
|
2,110,924
|
|
|
2,100,085
|
|
Interest
Income
|
27,227
|
|
|
26,213
|
|
|
26,000
|
|
|
24,495
|
|
|
23,590
|
|
Tax-Equivalent
Adjustment 3
|
376
|
|
|
373
|
|
|
376
|
|
|
376
|
|
|
468
|
|
Interest Income,
Tax-Equivalent 3
|
27,603
|
|
|
26,586
|
|
|
26,376
|
|
|
24,871
|
|
|
24,058
|
|
Interest
Expense
|
5,520
|
|
|
5,092
|
|
|
4,343
|
|
|
3,498
|
|
|
2,628
|
|
Net Interest
Income
|
21,707
|
|
|
21,121
|
|
|
21,657
|
|
|
20,997
|
|
|
20,962
|
|
Net Interest Income,
Tax-Equivalent 3
|
22,083
|
|
|
21,494
|
|
|
22,033
|
|
|
21,373
|
|
|
21,430
|
|
Net Interest Margin,
annualized
|
3.04
|
%
|
|
3.01
|
%
|
|
3.03
|
%
|
|
3.02
|
%
|
|
3.11
|
%
|
Net Interest Margin,
Tax-Equivalent, annualized 3
|
3.09
|
%
|
|
3.06
|
%
|
|
3.09
|
%
|
|
3.08
|
%
|
|
3.18
|
%
|
|
|
|
|
|
|
|
|
|
|
Efficiency Ratio
Calculation: 4
|
|
|
|
|
|
|
|
|
|
Noninterest
Expense
|
$
|
16,908
|
|
|
$
|
16,652
|
|
|
$
|
16,881
|
|
|
$
|
16,026
|
|
|
$
|
16,192
|
|
Less: Intangible
Asset Amortization
|
44
|
|
|
79
|
|
|
65
|
|
|
65
|
|
|
66
|
|
Net Noninterest
Expense
|
$
|
16,864
|
|
|
$
|
16,573
|
|
|
$
|
16,816
|
|
|
$
|
15,961
|
|
|
$
|
16,126
|
|
Net Interest Income,
Tax-Equivalent
|
$
|
22,083
|
|
|
$
|
21,494
|
|
|
$
|
22,033
|
|
|
$
|
21,373
|
|
|
$
|
21,430
|
|
Noninterest
Income
|
6,896
|
|
|
6,887
|
|
|
6,799
|
|
|
7,350
|
|
|
7,911
|
|
Less: Net Changes in
Fair Value of Equity Invest.
|
—
|
|
|
76
|
|
|
(142)
|
|
|
114
|
|
|
223
|
|
Net Gross
Income
|
$
|
28,979
|
|
|
$
|
28,305
|
|
|
$
|
28,974
|
|
|
$
|
28,609
|
|
|
$
|
29,118
|
|
Efficiency
Ratio
|
58.19
|
%
|
|
58.55
|
%
|
|
58.04
|
%
|
|
55.79
|
%
|
|
55.38
|
%
|
|
|
|
|
|
|
|
|
|
|
Period-End Capital
Information:
|
|
|
|
|
|
|
|
|
|
Total Stockholders'
Equity (i.e. Book Value)
|
$
|
284,649
|
|
|
$
|
276,609
|
|
|
$
|
269,584
|
|
|
$
|
264,810
|
|
|
$
|
259,488
|
|
Book Value per
Share 1
|
19.61
|
|
|
19.11
|
|
|
18.63
|
|
|
18.34
|
|
|
17.99
|
|
Goodwill and Other
Intangible Assets, net
|
23,603
|
|
|
23,650
|
|
|
23,725
|
|
|
23,827
|
|
|
23,933
|
|
Tangible Book Value
per Share 1,2
|
17.99
|
|
|
17.48
|
|
|
16.99
|
|
|
16.69
|
|
|
16.33
|
|
|
|
|
|
|
|
|
|
|
|
Capital
Ratios:5
|
|
|
|
|
|
Tier 1 Leverage
Ratio
|
9.88
|
%
|
|
9.73
|
%
|
|
9.61
|
%
|
|
9.67
|
%
|
|
9.65
|
%
|
Common Equity Tier 1
Capital Ratio
|
12.99
|
%
|
|
12.98
|
%
|
|
12.89
|
%
|
|
12.89
|
%
|
|
13.01
|
%
|
Tier 1 Risk-Based
Capital Ratio
|
13.93
|
%
|
|
13.95
|
%
|
|
13.87
|
%
|
|
13.90
|
%
|
|
14.04
|
%
|
Total Risk-Based
Capital Ratio
|
14.91
|
%
|
|
14.93
|
%
|
|
14.86
|
%
|
|
14.90
|
%
|
|
15.06
|
%
|
|
|
|
|
|
|
|
|
|
|
Assets Under Trust
Admin. & Investment Mgmt.
|
$
|
1,496,966
|
|
|
$
|
1,483,259
|
|
|
$
|
1,385,752
|
|
|
$
|
1,551,289
|
|
|
$
|
1,479,753
|
|
Arrow Financial
Corporation
Selected Quarterly
Information - Continued
(Dollars In
Thousands, Except Per Share Amounts - Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Footnotes:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1.
|
Share and Per Share
Data have been restated for the September 27, 2018, 3% stock
dividend.
|
|
|
2.
|
Non-GAAP Financial
Measures Reconciliation: Tangible Book Value and Tangible Equity
exclude goodwill and other intangible assets, net from total
equity. These are non-GAAP financial measures which we
believe provide investors with information that is useful in
understanding our financial performance.
|
|
|
6/30/2019
|
|
3/31/2019
|
|
12/31/2018
|
|
9/30/2018
|
|
6/30/2018
|
|
Total Stockholders'
Equity (GAAP)
|
$
|
284,649
|
|
|
$
|
276,609
|
|
|
$
|
269,584
|
|
|
$
|
264,810
|
|
|
$
|
259,488
|
|
|
Less: Goodwill and
Other Intangible assets, net
|
23,603
|
|
|
23,650
|
|
|
23,725
|
|
|
23,827
|
|
|
23,933
|
|
|
Tangible Equity
(Non-GAAP)
|
$
|
261,046
|
|
|
$
|
252,959
|
|
|
$
|
245,859
|
|
|
$
|
240,983
|
|
|
$
|
235,555
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Period End Shares
Outstanding
|
14,513
|
|
|
14,474
|
|
|
14,472
|
|
|
14,441
|
|
|
14,424
|
|
|
Tangible Book Value
per Share (Non-GAAP)
|
$
|
17.99
|
|
|
$
|
17.48
|
|
|
$
|
16.99
|
|
|
$
|
16.69
|
|
|
$
|
16.33
|
|
|
Net Income
|
8,934
|
|
|
8,734
|
|
|
8,758
|
|
|
9,260
|
|
|
9,730
|
|
|
Return on Tangible
Equity (Net Income/Tangible Equity - Annualized)
|
13.96
|
%
|
|
14.22
|
%
|
|
14.20
|
%
|
|
15.36
|
%
|
|
16.80
|
%
|
|
|
|
|
|
|
|
|
|
|
|
3.
|
Non-GAAP Financial
Measures Reconciliation: Net Interest Margin, Tax-Equivalent is the
ratio of our annualized tax-equivalent net interest income to
average earning assets. This is also a non-GAAP financial measure
which we believe provides investors with information that is useful
in understanding our financial performance.
|
|
|
6/30/2019
|
|
3/31/2019
|
|
12/31/2018
|
|
9/30/2018
|
|
6/30/2018
|
|
Interest Income
(GAAP)
|
$
|
27,227
|
|
|
$
|
26,213
|
|
|
$
|
26,000
|
|
|
$
|
24,495
|
|
|
$
|
23,590
|
|
|
Add: Tax-Equivalent
adjustment
(Non-GAAP)
|
376
|
|
|
373
|
|
|
376
|
|
|
376
|
|
|
468
|
|
|
Interest Income - Tax
Equivalent
(Non-GAAP)
|
$
|
27,603
|
|
|
$
|
26,586
|
|
|
$
|
26,376
|
|
|
$
|
24,871
|
|
|
$
|
24,058
|
|
|
Net Interest Income
(GAAP)
|
$
|
21,707
|
|
|
$
|
21,121
|
|
|
$
|
21,657
|
|
|
$
|
20,997
|
|
|
$
|
20,962
|
|
|
Add: Tax-Equivalent
adjustment
(Non-GAAP)
|
376
|
|
|
373
|
|
|
376
|
|
|
376
|
|
|
468
|
|
|
Net Interest Income -
Tax Equivalent
(Non-GAAP)
|
$
|
22,083
|
|
|
$
|
21,494
|
|
|
$
|
22,033
|
|
|
$
|
21,373
|
|
|
$
|
21,430
|
|
|
Average Earning
Assets
|
$
|
2,865,085
|
|
|
$
|
2,847,966
|
|
|
$
|
2,832,558
|
|
|
$
|
2,757,020
|
|
|
$
|
2,703,054
|
|
|
Net Interest Margin
(Non-GAAP)*
|
3.09
|
%
|
|
3.06
|
%
|
|
3.09
|
%
|
|
3.08
|
%
|
|
3.18
|
%
|
|
|
|
|
|
|
|
|
|
|
|
4.
|
Non-GAAP Financial
Measures: Financial Institutions often use the "efficiency ratio",
a non-GAAP ratio, as a measure of expense control. We believe the
efficiency ratio provides investors with information that is useful
in understanding our financial performance. We define our
efficiency ratio as the ratio of our noninterest expense to our net
gross income (which equals our tax-equivalent net interest income
plus noninterest income, as adjusted).
|
|
|
|
|
|
|
|
|
|
|
|
5.
|
For the current
quarter, all of the regulatory capital ratios in the table above,
as well as the Total Risk-Weighted Assets and Common Equity Tier 1
Capital amounts listed in the table below, are estimates based on,
and calculated in accordance with, bank regulatory capital rules.
All prior quarters reflect actual results. The CET1 ratio at June
30, 2019 listed in the tables (i.e., 12.99%) exceeds the sum of the
required minimum CET1 ratio plus the fully phased-in Capital
Conservation Buffer (i.e., 7.00%).
|
|
|
6/30/2019
|
|
3/31/2019
|
|
12/31/2018
|
|
9/30/2018
|
|
6/30/2018
|
|
Total Risk Weighted
Assets
|
$
|
2,121,541
|
|
|
$
|
2,075,115
|
|
|
$
|
2,046,495
|
|
|
$
|
1,999,849
|
|
|
$
|
1,934,890
|
|
|
Common Equity Tier 1
Capital
|
275,528
|
|
|
269,363
|
|
|
263,863
|
|
|
257,852
|
|
|
251,666
|
|
|
Common Equity Tier 1
Ratio
|
12.99
|
%
|
|
12.98
|
%
|
|
12.89
|
%
|
|
12.89
|
%
|
|
13.01
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Quarterly ratios
have been annualized
|
Arrow Financial
Corporation
Consolidated
Financial Information
(Dollars in Thousands
- Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended:
|
6/30/2019
|
|
12/31/2018
|
|
6/30/2018
|
Loan
Portfolio
|
|
|
|
|
|
Commercial
Loans
|
$
|
138,331
|
|
|
$
|
136,890
|
|
|
$
|
118,881
|
|
Commercial Real
Estate Loans
|
490,274
|
|
|
484,562
|
|
|
464,393
|
|
Subtotal
Commercial Loan Portfolio
|
628,605
|
|
|
621,452
|
|
|
583,274
|
|
Consumer
Loans
|
779,024
|
|
|
719,510
|
|
|
661,908
|
|
Residential Real
Estate Loans
|
872,679
|
|
|
855,253
|
|
|
812,680
|
|
Total
Loans
|
$
|
2,280,308
|
|
|
$
|
2,196,215
|
|
|
$
|
2,057,862
|
|
Allowance for Loan
Losses
|
|
|
|
|
|
Allowance for Loan
Losses, Beginning of Quarter
|
$
|
20,373
|
|
|
$
|
20,003
|
|
|
$
|
19,057
|
|
Loans
Charged-off
|
(368)
|
|
|
(573)
|
|
|
(264)
|
|
Less Recoveries of
Loans Previously Charged-off
|
235
|
|
|
120
|
|
|
218
|
|
Net Loans
Charged-off
|
(133)
|
|
|
(453)
|
|
|
(46)
|
|
Provision for Loan
Losses
|
455
|
|
|
646
|
|
|
629
|
|
Allowance for Loan
Losses, End of Quarter
|
$
|
20,695
|
|
|
$
|
20,196
|
|
|
$
|
19,640
|
|
Nonperforming
Assets
|
|
|
|
|
|
Nonaccrual
Loans
|
$
|
4,949
|
|
|
$
|
4,159
|
|
|
$
|
3,880
|
|
Loans Past Due 90 or
More Days and Accruing
|
457
|
|
|
1,225
|
|
|
170
|
|
Loans Restructured
and in Compliance with Modified Terms
|
142
|
|
|
138
|
|
|
106
|
|
Total Nonperforming
Loans
|
5,548
|
|
|
5,522
|
|
|
4,156
|
|
Repossessed
Assets
|
115
|
|
|
130
|
|
|
76
|
|
Other Real Estate
Owned
|
1,258
|
|
|
1,130
|
|
|
1,412
|
|
Total Nonperforming
Assets
|
$
|
6,921
|
|
|
$
|
6,782
|
|
|
$
|
5,644
|
|
Key Asset Quality
Ratios
|
|
|
|
|
|
Net Loans Charged-off
to Average Loans,
Quarter-to-date Annualized
|
0.02
|
%
|
|
0.08
|
%
|
|
0.01
|
%
|
Provision for Loan
Losses to Average Loans,
Quarter-to-date Annualized
|
0.08
|
%
|
|
0.12
|
%
|
|
0.12
|
%
|
Allowance for Loan
Losses to Period-End Loans
|
0.91
|
%
|
|
0.92
|
%
|
|
0.95
|
%
|
Allowance for Loan
Losses to Period-End Nonperforming Loans
|
373.02
|
%
|
|
365.74
|
%
|
|
472.57
|
%
|
Nonperforming Loans
to Period-End Loans
|
0.24
|
%
|
|
0.25
|
%
|
|
0.20
|
%
|
Nonperforming Assets
to Period-End Assets
|
0.23
|
%
|
|
0.23
|
%
|
|
0.20
|
%
|
Six-Month Period
Ended:
|
|
|
|
|
|
Allowance for Loan
Losses
|
|
|
|
|
|
Allowance for Loan
Losses, Beginning of Year
|
$
|
20,196
|
|
|
|
|
$
|
18,586
|
|
Loans
Charged-off
|
(830)
|
|
|
|
|
(634)
|
|
Less Recoveries of
Loans Previously Charged-off
|
402
|
|
|
|
|
313
|
|
Net Loans
Charged-off
|
(428)
|
|
|
|
|
(321)
|
|
Provision for Loan
Losses
|
927
|
|
|
|
|
1,375
|
|
Allowance for Loan
Losses, End of Period
|
$
|
20,695
|
|
|
|
|
$
|
19,640
|
|
Key Asset Quality
Ratios
|
|
|
|
|
|
Net Loans Charged-off
to Average Loans, Annualized
|
0.04
|
%
|
|
|
|
0.03
|
%
|
Provision for Loan
Losses to Average Loans, Annualized
|
0.08
|
%
|
|
|
|
0.14
|
%
|
View original
content:http://www.prnewswire.com/news-releases/arrow-reports-year-over-year-loan-growth-of-10-8-and-8-9-million-in-q2-net-income-300888504.html
SOURCE Arrow Financial Corporation