Tompkins Financial Corporation (TMP–NYSE Amex)
Tompkins Financial Corporation reported net income of $9.4
million for the fourth quarter of 2011, an increase of 5.6% over
the $8.9 million reported for the same period in 2010. Diluted
earnings per share were $0.84 for the fourth quarter of 2011, a
3.7% increase over the $0.81 reported for the fourth quarter of
2010.
For the twelve months ended December 31, 2011, net income was
$35.4 million, an increase of 4.7% over net income of $33.8 million
for the same period in 2010. Full year 2011 diluted earnings per
share totaled $3.20, an increase of 2.9% over the $3.11 reported
for 2010.
Stephen S. Romaine, President and CEO stated, “2011 was a strong
year for our Company with net income and total assets at record
levels. In an economic environment that continued to be
challenging, we were able to grow both loans and deposits in 2011.
We are also pleased with the favorable trends that we are seeing in
asset quality measures, with classified loans down from prior
quarter and year end 2010.”
Selected highlights for the fourth quarter and year-to-date
period included:
- Return on average equity was 12.02% in
2011, which ranks in the top 15% of our most recent peer group
average as published by the Federal Reserve1.
- Total loans were $2.0 billion at
December 31, 2011, up $71.5 million or 3.7% from December 31,
2010.
- Total deposits were $2.7 billion at
December 31, 2011, up 6.6% from the same period in 2010.
Noninterest-bearing deposits totaled $616.4 million at December 31,
2011, an increase of 17.8% over the same period in 2010.
- Total revenue was $39.2 million for the
fourth quarter of 2011 and $159.4 million for the twelve months
ended December 31, 2011, down 2.4% and up 0.9%, respectively,
compared to the same periods in 2010.
- The net interest margin for the fourth
quarter of 2011 was 3.62%, compared to 3.71% for the third quarter
of 2011, and 3.75% for the fourth quarter of 2010. For the year to
date, net interest margin was 3.72% in 2011, compared to 3.86% for
2010. Despite the decline in net interest margin over the past 12
months, net interest income of $28.0 million for the fourth quarter
of 2011 and $111.4 million for the full year of 2011 were
comparable to the same periods in 2010. Growth in interest earning
assets, primarily in the securities portfolio, helped mitigate the
earnings impact of the decline in margin.
- Noninterest income was down 8.8% for
the quarter and up 4.0% for the full year 2011 compared to the same
periods in 2010. Card services income and insurance commissions and
fees were up from the prior year for both the quarter and year to
date periods. Investment services income was down 10.3% for the
quarter and was flat for the twelve months ended December 31, 2011,
when compared to the same periods in 2010. Other income was down
$958,000 or 39.2% for the quarter and up $374,000 or 5.9% for the
twelve months ended December 31, 2011 compared to the same periods
in 2010. Contributing to the decrease from prior quarter were lower
loan fees and lower gains on the sale of residential mortgage
loans.
- Noninterest expense for the fourth
quarter of 2011 was $24.2 million, down 3.9% compared to the same
period prior year. Noninterest expense for the year-to-date period
was $98.6 million, comparable to the twelve months ended December
31, 2010. A reduction in FDIC insurance costs contributed to the
decrease in noninterest expense for both the fourth quarter and
full year.
- Provision for loan and lease losses was
$1.2 million for the fourth quarter of 2011, down from $4.9 million
in the third quarter of 2011, and $1.4 million in the fourth
quarter of 2010. For the full year, provision for loan and lease
losses was $8.9 million, up from $8.5 million in 2010. The third
quarter provision was largely the result of an increase in loan
charge-offs during the period, which included a single credit that
represented 91.7% of the $5.5 million in gross charge offs during
the third quarter.
- Nonperforming assets were generally
flat when compared to the most recent two quarters, and are down
8.2% when compared to the same quarter last year. The ratio of
nonperforming assets to total assets of 1.26% at December 31, 2011,
has improved for five consecutive quarters and remains well below
the most recent peer averages of 3.10% published as of September
30, 2011, by the Federal Reserve1. The Company continues to receive
regular payments on over 64% of loan balances that we categorize as
nonperforming.
- The Company’s allowance for loan and
lease losses totaled $27.6 million at December 31, 2011, which
represented 1.39% of total loans, compared to $27.8 million and
1.46% at December 31, 2010. The allowance for loan and lease losses
covered 66.65% of nonperforming loans as of December 31, 2011,
reflecting improvement from 61.46% at December 31, 2010.
- Capital levels continued to improve
during the quarter and ratios remain well above the regulatory well
capitalized minimums. Tier 1 capital as a percentage of average
assets was 8.51%; and the ratio of total capital to risk-weighted
assets was 14.17%.
Mr. Romaine, added, “Although the interest rate and economic
environment will remain a challenge for our business, our strong
balance sheet and earnings performance, along with a dedicated and
professional team of employees, continues to position us well to
take advantage of new growth opportunities.”
Tompkins Financial Corporation operates 45 banking offices in
the New York State markets served by the Company's three community
banks - Tompkins Trust Company, The Bank of Castile, and Mahopac
National Bank, insurance through Tompkins Insurance Agencies, Inc.
and wealth management through Tompkins Financial Advisors.
"Safe Harbor" Statement under the Private Securities Litigation
Reform of 1995:
This press release may include forward-looking statements with
respect to revenue sources, growth, market risk, and corporate
objectives. The Company assumes no duty, and specifically disclaims
any obligation, to update forward-looking statements, and cautions
that these statements are subject to numerous assumptions, risks,
and uncertainties, all of which could change over time. Actual
results could differ materially from forward-looking
statements.
1 Federal Reserve peer ratio as of September 30, 2011, includes
banks and bank holding companies with consolidated assets between
$3 billion and $10 billion.
TOMPKINS FINANCIAL CORPORATION CONDENSED CONSOLIDATED
STATEMENTS OF CONDITION (In thousands, except share and
per share data) (Unaudited)
As of As of ASSETS
12/31/2011 12/31/2010 Cash and noninterest
bearing balances due from banks $ 47,297 $ 47,339 Interest bearing
balances due from banks 2,170 2,226 Money market funds
100
100
Cash and Cash Equivalents 49,567
49,665 Trading securities, at fair value 19,598
22,837 Available-for-sale securities, at fair value 1,143,546
1,039,608 Held-to-maturity securities, fair value of $27,255 at
December 31, 2011, and $56,064 at December 31, 2010 26,673 54,973
Loans and leases, net of unearned income and deferred costs and
fees 1,981,849 1,910,358 Less: Allowance for loan and lease losses
27,593
27,832
Net Loans and Leases
1,954,256 1,882,526 Federal Home Loan Bank
stock and Federal Reserve Bank stock 19,070 21,985 Bank premises
and equipment, net 44,712 46,103 Corporate owned life insurance
43,044 40,024 Goodwill 43,898 41,649 Other intangible assets, net
4,096 4,207 Accrued interest and other assets
51,788 56,766
Total Assets
$ 3,400,248 $
3,260,343 LIABILITIES Deposits:
Interest bearing: Checking, savings and money market 1,356,870
1,230,815 Time 687,321 741,829 Noninterest bearing
616,373
523,229
Total Deposits 2,660,564
2,495,873 Federal funds purchased and securities sold
under agreements to repurchase 169,090 183,609 Other borrowings,
including certain amounts at fair value of $12,093 at December 31,
2011 and $11,629 at December 31, 2010 186,075 244,193 Trust
preferred debentures 25,065 25,060 Other liabilities
60,311
38,200
Total Liabilities
$ 3,101,105
$ 2,986,935 EQUITY Tompkins
Financial Corporation shareholders' equity: Common Stock - par
value $.10 per share: Authorized 25,000,000 shares; Issued:
11,159,466 at December 31, 2011; and 10,934,385 at December 31,
2010 1,116 1,093 Additional paid-in capital 206,395 198,114
Retained earnings 96,445 76,446 Accumulated other comprehensive
loss (3,677 ) (1,260 ) Treasury stock, at cost – 95,105 shares at
December 31, 2011, and 92,025 shares at December 31, 2010 (2,588 )
(2,437 )
Total Tompkins Financial Corporation
Shareholders’ Equity 297,691 271,956
Noncontrolling interests 1,452
1,452
Total
Equity $ 299,143
$ 273,408
Total Liabilities and Equity
$ 3,400,248 $
3,260,343 TOMPKINS FINANCIAL
CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended
Twelve Months Ended (In thousands, except per share
data) (Unaudited)
12/31/2011
12/31/2010 12/31/2011
12/31/2010 INTEREST AND DIVIDEND INCOME Loans $
26,280 $ 26,314 $ 103,998 $ 106,357 Due from banks 1 4 12 31
Federal funds sold 2 2 7 17 Trading securities 205 242 873 1,084
Available-for-sale securities 6,996 7,980 30,103 33,989
Held-to-maturity securities 240 375 1,185 1,535 Federal Home Loan
Bank stock and Federal Reserve Bank stock
189 317
910
1,049
Total Interest and Dividend Income
33,913
35,234
137,088 144,062
INTEREST EXPENSE Time certificates of deposits of
$100,000 or more 758 938 3,292 4,297 Other deposits 2,156 2,873
9,795 13,380 Federal funds purchased and securities sold under
agreements to repurchase 1,129 1,349 4,872 5,418 Trust preferred
debentures 382 371 1,580 1,581 Other borrowings
1,489 1,842
6,143
7,611
Total Interest Expense
5,914
7,373
25,682 32,287
Net Interest Income
27,999
27,861 111,406
111,775 Less:
Provision for loan and lease losses
1,160 1,433
8,945 8,507
Net Interest Income After Provision for Loan and Lease
Losses 26,839
26,428
102,461
103,268 NONINTEREST INCOME Investment services
income 3,196 3,564 14,287 14,329 Insurance commissions and fees
3,136 3,016 13,542 12,738 Service charges on deposit accounts 2,235
1,952 8,491 8,554 Card services income 1,275 1,138 5,060 4,285
Mark-to-market (loss) gain on trading securities (108 ) (339 ) 62
219 Mark-to-market gain (loss) on liabilities held at fair value 25
500 (464 ) (441 ) Other income 1,488 2,446 6,705 6,331 Net
other-than-temporary impairment losses (65 ) 0 (65 ) (34 ) Net gain
on securities transactions 15
4
396 178
Total
Noninterest Income
11,197 12,281
48,014
46,159 NONINTEREST
EXPENSES Salaries and wages 10,914 10,911 44,140 42,530 Pension
and other employee benefits 3,213 3,554 14,275 14,523 Net occupancy
expense of premises 1,796 1,735 7,117 7,161 Furniture and fixture
expense 1,138 1,109 4,463 4,421 FDIC insurance 471 1,022 2,527
3,768 Amortization of intangible assets 136 175 589 762 Other
operating expense 6,532
6,677
25,441 25,880
Total Noninterest Expenses
24,200
25,183 98,552
99,045 Income
Before Income Tax Expense
13,836 13,526
51,923
50,382 Income Tax Expense
4,417
4,602 16,373
16,420
Net Income
attributable to Noncontrolling Interests and Tompkins Financial
Corporation 9,419
8,924
35,550
33,962 Less: Net income attributable to
noncontrolling interests 32
32
131 131
Net
Income Attributable to Tompkins Financial Corporation
$ 9,387
$ 8,892 $
35,419 $ 33,831
Basic Earnings Per Share $ 0.84
$ 0.82 $ 3.21 $ 3.13
Diluted Earnings Per Share
$ 0.84 $
0.81 $ 3.20
$ 3.11 See
accompanying notes to unaudited condensed consolidated financial
statements.
Average Consolidated Balance Sheet and Net
Interest Analysis
Quarter Ended
Year to Date Period Ended
Year to Date Period Ended
December 31, 2011
December 31, 2011 December 31,
2010 Average Average
Average
Balance Average Balance Average Balance Average (Dollar amounts in
thousands) (QTD)
Interest Yield/Rate
(YTD)
Interest Yield/Rate
(YTD)
Interest Yield/Rate
ASSETS Interest-earning assets Interest-bearing balances due
from banks $ 20,815 $ 1 0.04 % $ 12,717 $ 12 0.09 % $ 25,189 $ 31
0.12 % Money market funds 100 - 0.00 % 100 - 0.00 % 100 - 0.00 %
Securities (1) U.S. Government securities 1,011,681 6,386 2.50 %
969,303 27,504 2.84 % 857,724 30,964 3.61 % Trading securities
20,110 205 4.04 % 21,262 873 4.11 % 27,389 1,085 3.96 % State and
municipal (2) 82,632 1,156 5.55 % 95,039 5,143 5.41 % 107,376 6,059
5.64 % Other securities (2) 12,790 146
4.53 %
13,971 648
4.64 % 17,465
849 4.86 % Total securities
1,127,213 7,893 2.78 % 1,099,575 34,168 3.11 % 1,009,954 38,957
3.86 % Federal Funds Sold 4,646 2 0.09 % 5,837 7 0.12 % 9,233 17
0.18 % FHLBNY and FRB stock 17,068 189 4.44 % 17,992 910 5.06 %
19,597 1,049 5.35 % Loans, net of unearned income (3) Real estate
1,423,532 18,861 5.26 % 1,395,533 74,598 5.35 % 1,345,540 75,610
5.62 % Commercial loans (2) 465,471 6,352 5.41 % 457,120 24,792
5.42 % 461,339 24,730 5.36 % Consumer loans 65,749 1,118 6.74 %
68,364 4,712 6.89 % 80,412 5,619 6.99 % Direct lease financing
6,457 94
5.77 % 7,523
446 5.93 %
10,692 643
6.01 % Total loans, net of unearned income 1,961,209
26,425 5.34 %
1,928,540
104,548 5.42 %
1,897,983 106,602
5.62 %
Total interest-earning assets
3,131,051 34,511
4.37 %
3,064,761 139,645
4.56 %
2,962,056 146,656
4.95 % Other
assets 237,084 230,221 229,784
Total assets
3,368,135 3,294,982 3,191,840
LIABILITIES & EQUITY
Deposits Interest-bearing deposits Interest bearing checking,
savings, & money market 1,400,283 1,047 0.30 % 1,350,659 4,741
0.35 % 1,226,852 5,994 0.49 % Time deposits > $100,000 309,773
758 0.97 % 313,881 3,292 1.05 % 327,626 4,297 1.31 % Time deposits
< $100,000 388,100 1,109 1.13 % 401,902 5,033 1.25 % 432,804
6,984 1.61 % Brokered time deposits < $100,000 13
0 0.00 %
1,731 21
1.21 % 24,886
402 1.62 % Total
interest-bearing deposits 2,098,169 2,914 0.55 % 2,068,173 13,087
0.63 % 2,012,168 17,677 0.88 % Federal funds purchased &
securities sold under agreements to repurchase 170,358 1,129 2.63 %
173,692 4,872 2.80 % 185,563 5,418 2.92 % Other borrowings 141,735
1,489 4.17 % 155,650 6,143 3.95 % 193,296 7,611 3.94 % Trust
preferred debentures 25,064 383
6.06 % 25,062
1,580 6.30
% 25,058
1,581 6.31 %
Total interest-bearing
liabilities 2,435,326 5,915 0.96 %
2,422,577 25,682 1.06 %
2,416,085 32,287 1.34 %
Noninterest bearing deposits 584,514 539,917 468,219 Accrued
expenses and other liabilities 40,756 37,868 41,593
Total
liabilities 3,060,596 3,000,362 2,925,897 Tompkins
Financial Corporation Shareholders’ equity 305,996 292,845 264,431
Noncontrolling interest 1,543 1,775 1,512
Total equity
307,539 294,620 265,943 Total
liabilities and equity $ 3,368,135 $
3,294,982 $ 3,191,840 Interest rate spread
3.41 %
3.50 %
3.61 % Net interest
income/margin on earning assets
28,596 3.62 %
113,963 3.72 % 114,369 3.86
% Tax Equivalent Adjustment
(597
)
(2,557
)
(2,594
)
Net interest income per consolidated financial
statements
$ 27,999
$ 111,406
$
111,775 (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 a combined
New York State and Federal effective income tax rate of 40% 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, 2010.
Tompkins Financial Corporation - Summary Financial Data
(Unaudited)
(In thousands, except per share data)
Quarter-Ended Year-Ended
Dec-11 Sep-11
Jun-11
Mar-11 Dec-10
Dec-11
Period End Balance Sheet
Securities
$ 1,189,817 $
1,130,769 $ 1,138,563
$ 1,121,443 $ 1,117,418
$ 1,189,817 Loans and leases,
net of unearned income and deferred costs and fees
1,981,849
1,951,598 1,920,716
1,914,344
1,910,358 1,981,849
Allowance for loan and lease losses
27,593 27,878
28,361
28,035 27,832
27,593 Total assets
3,400,248
3,359,017
3,287,598 3,278,894
3,260,343
3,400,248
Total deposits
2,660,564
2,675,674 2,572,008
2,612,517
2,495,873 2,660,564
Federal funds purchased and securities sold under agreements
to repurchase 169,090
171,943
178,545 182,009
183,609
169,090 Other borrowings
186,075 138,001
172,643
140,353 244,193
186,075 Trust preferred
debentures 25,065
25,063
25,062 25,061
25,060
25,065 Shareholders' equity
299,143 309,335
300,060
282,237 273,408
299,143
Average
Balance Sheet
Average earning assets
$ 3,131,051 $ 3,050,346
$ 3,047,494 $
3,029,188 $ 3,010,361
$ 3,064,761 Average assets
3,368,135
3,286,159 3,271,895
3,252,549
3,243,822 3,294,982
Average interest-bearing liabilities
2,435,326
2,391,576 2,432,556
2,431,145
2,424,998 2,422,577
Average equity 307,539
303,861
288,341 277,283
280,051
294,620
Share data
Weighted
average shares outstanding (basic)
11,074,330 11,049,831
10,974,615
10,905,197
10,888,138 11,002,106
Weighted average shares outstanding (diluted)
11,104,623
11,124,331 11,016,515
10,955,430
10,936,042 11,035,384
Period-end shares outstanding
11,123,556 11,122,886
11,051,894
10,952,410
10,898,475 11,123,556
Book value per share 26.89
27.81
27.15 25.77
25.09
26.89
Income Statement
Net
interest income $ 27,999
$ 27,913 $ 27,952
$ 27,542 $ 27,861
$ 111,406 Provision for
loan/lease losses 1,160
4,870
1,005 1,910
1,433 8,945
Noninterest income 11,197
12,312
12,013 12,492
12,281
48,014 Noninterest expense
24,200
23,973 25,163
25,216
25,183 98,552 Income tax
expense 4,417
3,490 4,364
4,102
4,602 16,373
Net income attributable to Tompkins Financial Corporation
9,387
7,859 9,400
8,773
8,892 35,419
Noncontrolling interests 32
33
33 33
32 131
Basic earnings per share $ 0.84
$ 0.71 $
0.86 $ 0.80
$ 0.82 $ 3.21 Diluted earnings
per share $ 0.84
$ 0.71 $ 0.85
$ 0.80 $ 0.81
$ 3.20
Asset Quality
Net charge-offs 1,445
5,353
679 1,707
2,285
9,184 Nonaccrual loans and leases
39,588
40,419 38,457
39,902
41,501 39,588 Loans and
leases 90 days past due and accruing
1,380 379
2,512 1,266
1,217
1,380 Troubled debt restructurings not
included above 428
441 0
2,411
2,564 428
Total nonperforming loans and leases
41,396 41,239
40,969
43,579 45,282
41,396 OREO
1,334 1,632
1,742
2,270 1,255
1,334 Nonperforming assets
42,730
42,871 42,711
45,849
46,537 42,730
Loan Classifications
Special Mention
52,156
66,697 80,470
70,765
80,920 52,156 Substandard
72,920
73,313 80,003
85,973
91,645 72,920
Doubtful 1,494
509
2,450 2,468
0 1,494
RATIO
ANALYSIS Quarter-Ended Year-Ended
Credit Quality Dec-11
Sep-11
Jun-11 Mar-11
Dec-10
Dec-11 Net loan and lease losses/ average
loans and leases * 0.29 %
1.10 % 0.14 %
0.36 % 0.48
% 0.48 % Nonperforming loans and
leases/loans and leases 2.09 %
2.11 % 2.13
% 2.28 %
2.37 % 2.09 % Nonperforming
assets/assets 1.26 %
1.28 % 1.30 %
1.40 % 1.43
% 1.26 % Allowance/nonperforming loans
and leases 66.65 %
67.60 % 69.23 %
64.33 % 61.46 %
66.65 % Allowance/loans and leases
1.39 %
1.43 % 1.48 %
1.46 % 1.46 %
1.39 %
Capital Adequacy
(period-end)
Tier I capital / average assets
8.51 % 8.55 %
8.39 % 8.22
% 8.02 %
8.51 % Total capital / risk-weighted assets
14.17 % 14.11 %
13.98 % 13.66 %
13.42 %
14.17 %
Profitability
Return on average assets
* 1.11 %
0.95 % 1.15 %
1.09 % 1.09 %
1.07 % Return on average equity *
12.07 %
10.29 % 13.08 %
12.83 % 12.60 %
12.02 % Net interest margin (TE) *
3.62 % 3.71 %
3.77 % 3.78
% 3.75 %
3.72 % * Quarterly ratios have been annualized
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