PR Newswire
GLENS FALLS, N.Y., July 27, 2022
GLENS FALLS, N.Y., July 27, 2022 /PRNewswire/ -- Arrow Financial Corporation (NasdaqGS® – AROW) announced financial results for the three-month period ended June 30, 2022. Net income for the second quarter of 2022 was $12.0 million and diluted earnings per share was $0.75.
Loan growth was strong in the second quarter of 2022, with gross loans increasing by $108 million. Excluding Paycheck Protection Program (PPP) loans, which decreased by $17 million, loans grew by $125 million in the quarter.
"Arrow had a strong second quarter with total loan balances at June 30, 2022 reaching a record high," said Arrow President and CEO Thomas J. Murphy. "I commend the Arrow Team for their outstanding efforts and strong work ethic. While economic challenges are expected this year, I am confident in our direction as a Company and our ability to deliver strong results for our shareholders, our customers and our communities."
For the second quarter of 2022, net income was $12.0 million compared to $13.3 million for the second quarter of 2021. The year-over-year decline in second quarter net income was primarily due to:
Second Quarter Highlights
Earnings:
Balance Sheet:
Additional Items:
Income Statement
Three Months Ended | |||||||||||
June 30, 2022 | June 30, 2021 | ||||||||||
Interest and Dividend Income | $ | 30,593 | $ | 29,695 | |||||||
Interest Expense | 1,555 | 1,335 | |||||||||
Net Interest Income | 29,038 | 28,360 | |||||||||
Average Earning Assets(1) | 3,858,837 | 3,688,572 | |||||||||
Average Interest-Bearing Liabilities | 2,808,287 | 2,721,961 | |||||||||
Yield on Earning Assets(1) | 3.18 | % | 3.23 | % | |||||||
Cost of Interest-Bearing Liabilities | 0.22 | 0.20 | |||||||||
Net Interest Spread | 2.96 | 3.03 | |||||||||
Net Interest Margin | 3.02 | 3.08 | |||||||||
Income Earned on PPP Loans included in Net Interest Income | $ | 438 | $ | 3,086 | |||||||
Net Interest Income excluding PPP loans | 28,600 | 25,274 | |||||||||
Net Interest Margin excluding PPP loans | 2.98 | % | 2.86 | % | |||||||
(1) Includes Nonaccrual Loans. |
Balance Sheet
Additional Commentary
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. Arrow is the parent of Glens Falls National Bank and Trust Company and Saratoga National Bank and Trust Company. Other subsidiaries include Upstate Agency, LLC and North Country Investment Advisers, Inc.
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). Some 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. These 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 Arrow are useful in evaluating Arrow'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 in this document may contain statements based on management's beliefs, assumptions, expectations, estimates and projections about the future. Such "forward-looking statements," as defined in Section 21E of the Securities Exchange Act of 1934, as amended, involve a degree of uncertainty and attendant risk. Actual outcomes and results may differ, explicitly or by implication. We are not obliged to revise or update these statements to reflect unanticipated events. This document should be read in conjunction with Arrow's Annual Report on Form 10-K for the year ended December 31, 2021 and other filings with the SEC.
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, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
INTEREST AND DIVIDEND INCOME | ||||||||||||||||||||||||||
Interest and Fees on Loans | $ | 26,906 | $ | 27,014 | $ | 52,645 | $ | 52,197 | ||||||||||||||||||
Interest on Deposits at Banks | 427 | 103 | 625 | 188 | ||||||||||||||||||||||
Interest and Dividends on Investment Securities: | ||||||||||||||||||||||||||
Fully Taxable | 2,444 | 1,671 | 4,633 | 3,177 | ||||||||||||||||||||||
Exempt from Federal Taxes | 816 | 907 | 1,637 | 1,827 | ||||||||||||||||||||||
Total Interest and Dividend Income | 30,593 | 29,695 | 59,540 | 57,389 | ||||||||||||||||||||||
INTEREST EXPENSE | ||||||||||||||||||||||||||
Interest-Bearing Checking Accounts | 199 | 192 | 362 | 411 | ||||||||||||||||||||||
Savings Deposits | 892 | 501 | 1,309 | 1,066 | ||||||||||||||||||||||
Time Deposits over $250,000 | 26 | 69 | 54 | 189 | ||||||||||||||||||||||
Other Time Deposits | 111 | 156 | 220 | 378 | ||||||||||||||||||||||
Federal Funds Purchased and | — | 1 | — | 3 | ||||||||||||||||||||||
Federal Home Loan Bank Advances | 108 | 196 | 295 | 389 | ||||||||||||||||||||||
Junior Subordinated Obligations Issued to | 171 | 171 | 340 | 340 | ||||||||||||||||||||||
Interest on Financing Leases | 48 | 49 | 97 | 98 | ||||||||||||||||||||||
Total Interest Expense | 1,555 | 1,335 | 2,677 | 2,874 | ||||||||||||||||||||||
NET INTEREST INCOME | 29,038 | 28,360 | 56,863 | 54,515 | ||||||||||||||||||||||
Provision for Credit Losses | 905 | 263 | 1,674 | (385) | ||||||||||||||||||||||
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES | 28,133 | 28,097 | 55,189 | 54,900 | ||||||||||||||||||||||
NONINTEREST INCOME | ||||||||||||||||||||||||||
Income From Fiduciary Activities | 2,517 | 2,589 | 5,113 | 4,967 | ||||||||||||||||||||||
Fees for Other Services to Customers | 3,050 | 2,919 | 5,845 | 5,528 | ||||||||||||||||||||||
Insurance Commissions | 1,622 | 1,626 | 3,133 | 3,266 | ||||||||||||||||||||||
Net Gain on Securities | 154 | 196 | 284 | 356 | ||||||||||||||||||||||
Net Gain on Sales of Loans | 10 | 625 | 62 | 2,040 | ||||||||||||||||||||||
Other Operating Income | 391 | 523 | 1,469 | 929 | ||||||||||||||||||||||
Total Noninterest Income | 7,744 | 8,478 | 15,906 | 17,086 | ||||||||||||||||||||||
NONINTEREST EXPENSE | ||||||||||||||||||||||||||
Salaries and Employee Benefits | 11,687 | 10,845 | 22,973 | 21,983 | ||||||||||||||||||||||
Occupancy Expenses, Net | 1,602 | 1,484 | 3,200 | 3,077 | ||||||||||||||||||||||
Technology and Equipment Expense | 3,974 | 3,710 | 7,753 | 7,169 | ||||||||||||||||||||||
FDIC Assessments | 291 | 245 | 598 | 515 | ||||||||||||||||||||||
Other Operating Expense | 2,791 | 2,803 | 4,766 | 5,021 | ||||||||||||||||||||||
Total Noninterest Expense | 20,345 | 19,087 | 39,290 | 37,765 | ||||||||||||||||||||||
INCOME BEFORE PROVISION FOR INCOME TAXES | 15,532 | 17,488 | 31,805 | 34,221 | ||||||||||||||||||||||
Provision for Income Taxes | 3,558 | 4,209 | 7,256 | 7,662 | ||||||||||||||||||||||
NET INCOME | $ | 11,974 | $ | 13,279 | $ | 24,549 | $ | 26,559 | ||||||||||||||||||
Average Shares Outstanding 1: | ||||||||||||||||||||||||||
Basic | 16,014 | 16,024 | 16,022 | 16,009 | ||||||||||||||||||||||
Diluted | 16,054 | 16,085 | 16,069 | 16,056 | ||||||||||||||||||||||
Per Common Share: | ||||||||||||||||||||||||||
Basic Earnings | $ | 0.75 | $ | 0.83 | $ | 1.53 | $ | 1.66 | ||||||||||||||||||
Diluted Earnings | 0.75 | 0.83 | 1.53 | 1.65 | ||||||||||||||||||||||
1 2021 Share and Per Share Amounts have been restated for the September 24, 2021, 3% stock dividend. |
ARROW FINANCIAL CORPORATION AND SUBSIDIARIES | |||||||||||||||||
CONSOLIDATED BALANCE SHEETS | |||||||||||||||||
(In Thousands, Except Share and Per Share Amounts - Unaudited) | |||||||||||||||||
June 30, | December 31, | June 30, | |||||||||||||||
ASSETS | |||||||||||||||||
Cash and Due From Banks | $ | 51,549 | $ | 26,978 | $ | 44,760 | |||||||||||
Interest-Bearing Deposits at Banks | 165,705 | 430,718 | 433,468 | ||||||||||||||
Investment Securities: | |||||||||||||||||
Available-for-Sale at Fair Value | 582,741 | 559,316 | 437,868 | ||||||||||||||
Held-to-Maturity (Fair Value of $180,511 at June 30, 2022; $201,292 at December 31, 2021; and $210,916 at June 30, 2021) | 182,096 | 196,566 | 204,490 | ||||||||||||||
Equity Securities | 2,031 | 1,747 | 1,992 | ||||||||||||||
FHLB and Federal Reserve Bank Stock | 4,718 | 5,380 | 5,380 | ||||||||||||||
Loans | 2,844,802 | 2,667,941 | 2,644,082 | ||||||||||||||
Allowance for Credit Losses | (28,090) | (27,281) | (27,010) | ||||||||||||||
Net Loans | 2,816,712 | 2,640,660 | 2,617,072 | ||||||||||||||
Premises and Equipment, Net | 50,141 | 46,217 | 43,268 | ||||||||||||||
Goodwill | 21,873 | 21,873 | 21,873 | ||||||||||||||
Other Intangible Assets, Net | 1,710 | 1,918 | 2,082 | ||||||||||||||
Other Assets | 111,929 | 96,579 | 83,938 | ||||||||||||||
Total Assets | $ | 3,991,205 | $ | 4,027,952 | $ | 3,896,191 | |||||||||||
LIABILITIES | |||||||||||||||||
Noninterest-Bearing Deposits | 824,842 | 810,274 | 761,991 | ||||||||||||||
Interest-Bearing Checking Accounts | 1,046,570 | 994,391 | 977,955 | ||||||||||||||
Savings Deposits | 1,504,791 | 1,531,287 | 1,471,591 | ||||||||||||||
Time Deposits over $250,000 | 40,021 | 82,811 | 84,357 | ||||||||||||||
Other Time Deposits | 129,436 | 131,734 | 142,139 | ||||||||||||||
Total Deposits | 3,545,660 | 3,550,497 | 3,438,033 | ||||||||||||||
Federal Funds Purchased and | — | — | 3,092 | ||||||||||||||
Federal Home Loan Bank Term Advances | 25,000 | 45,000 | 45,000 | ||||||||||||||
Junior Subordinated Obligations Issued to Unconsolidated | 20,000 | 20,000 | 20,000 | ||||||||||||||
Finance Leases | 5,144 | 5,169 | 5,193 | ||||||||||||||
Other Liabilities | 38,903 | 36,100 | 31,840 | ||||||||||||||
Total Liabilities | 3,634,707 | 3,656,766 | 3,543,158 | ||||||||||||||
STOCKHOLDERS' EQUITY | |||||||||||||||||
Preferred Stock, $1 Par Value and 1,000,000 Shares Authorized at June 30, 2022, December 31, 2021 and June 30, 2021 | — | — | — | ||||||||||||||
Common Stock, $1 Par Value; 30,000,000 Shares Authorized (20,800,144 Shares Issued at June 30, 2022 and December 31, 2021 and 20,194,474 at June 30, 2021) | 20,800 | 20,800 | 20,194 | ||||||||||||||
Additional Paid-in Capital | 379,423 | 377,996 | 355,195 | ||||||||||||||
Retained Earnings | 69,980 | 54,078 | 60,494 | ||||||||||||||
Accumulated Other Comprehensive (Loss) Income | (29,564) | 347 | (2,658) | ||||||||||||||
Treasury Stock, at Cost (4,777,605 Shares at June 30, 2022; 4,759,414 Shares at December 31, 2021 and 4,622,797 Shares at June 30, 2021) | (84,141) | (82,035) | (80,192) | ||||||||||||||
Total Stockholders' Equity | 356,498 | 371,186 | 353,033 | ||||||||||||||
Total Liabilities and Stockholders' Equity | $ | 3,991,205 | $ | 4,027,952 | $ | 3,896,191 |
Arrow Financial Corporation | |||||||||||||||||||||||||||||
Selected Quarterly Information | |||||||||||||||||||||||||||||
(Dollars In Thousands, Except Per Share Amounts - Unaudited) | |||||||||||||||||||||||||||||
Quarter Ended | 6/30/2022 | 3/31/2022 | 12/31/2021 | 9/30/2021 | 6/30/2021 | ||||||||||||||||||||||||
Net Income | $ | 11,974 | $ | 12,575 | $ | 10,309 | $ | 12,989 | $ | 13,279 | |||||||||||||||||||
Transactions in Net Income (Net of Tax): | |||||||||||||||||||||||||||||
Net Changes in Fair Value of Equity Investments | 114 | 96 | (104) | (79) | 145 | ||||||||||||||||||||||||
Share and Per Share Data:1 | |||||||||||||||||||||||||||||
Period End Shares Outstanding | 16,023 | 16,013 | 16,041 | 16,020 | 16,039 | ||||||||||||||||||||||||
Basic Average Shares Outstanding | 16,014 | 16,030 | 16,028 | 16,027 | 16,024 | ||||||||||||||||||||||||
Diluted Average Shares Outstanding | 16,054 | 16,083 | 16,091 | 16,085 | 16,085 | ||||||||||||||||||||||||
Basic Earnings Per Share | $ | 0.75 | $ | 0.78 | $ | 0.64 | $ | 0.81 | $ | 0.83 | |||||||||||||||||||
Diluted Earnings Per Share | 0.75 | 0.78 | 0.63 | 0.81 | 0.83 | ||||||||||||||||||||||||
Cash Dividend Per Share | 0.270 | 0.270 | 0.260 | 0.252 | 0.252 | ||||||||||||||||||||||||
Selected Quarterly Average Balances: | |||||||||||||||||||||||||||||
Interest-Bearing Deposits at Banks | $ | 232,545 | $ | 410,644 | $ | 551,890 | $ | 416,500 | $ | 369,034 | |||||||||||||||||||
Investment Securities | 822,112 | 797,347 | 681,732 | 675,980 | 668,089 | ||||||||||||||||||||||||
Loans | 2,804,180 | 2,678,796 | 2,660,665 | 2,641,726 | 2,651,449 | ||||||||||||||||||||||||
Deposits | 3,569,754 | 3,582,256 | 3,590,766 | 3,435,933 | 3,395,271 | ||||||||||||||||||||||||
Other Borrowed Funds | 50,140 | 68,596 | 70,162 | 72,187 | 74,957 | ||||||||||||||||||||||||
Shareholders' Equity | 357,228 | 370,264 | 364,409 | 359,384 | 350,203 | ||||||||||||||||||||||||
Total Assets | 4,012,999 | 4,054,943 | 4,060,540 | 3,902,041 | 3,851,921 | ||||||||||||||||||||||||
Return on Average Assets, annualized | 1.20 | % | 1.26 | % | 1.01 | % | 1.32 | % | 1.38 | % | |||||||||||||||||||
Return on Average Equity, annualized | 13.44 | % | 13.77 | % | 11.22 | % | 14.34 | % | 15.21 | % | |||||||||||||||||||
Return on Average Tangible Equity, annualized 2 | 14.40 | % | 14.72 | % | 12.01 | % | 15.36 | % | 16.32 | % | |||||||||||||||||||
Average Earning Assets | $ | 3,858,837 | $ | 3,886,787 | $ | 3,894,287 | $ | 3,734,206 | $ | 3,688,572 | |||||||||||||||||||
Average Paying Liabilities | 2,808,287 | 2,855,884 | 2,841,304 | 2,705,283 | 2,721,961 | ||||||||||||||||||||||||
Interest Income | 30,593 | 28,947 | 28,354 | 29,807 | 29,695 | ||||||||||||||||||||||||
Tax-Equivalent Adjustment 3 | 269 | 270 | 285 | 292 | 293 | ||||||||||||||||||||||||
Interest Income, Tax-Equivalent 3 | 30,862 | 29,217 | 28,639 | 30,099 | 29,988 | ||||||||||||||||||||||||
Interest Expense | 1,555 | 1,122 | 1,152 | 1,169 | 1,335 | ||||||||||||||||||||||||
Net Interest Income | 29,038 | 27,825 | 27,202 | 28,638 | 28,360 | ||||||||||||||||||||||||
Net Interest Income, Tax-Equivalent 3 | 29,307 | 28,095 | 27,487 | 28,930 | 28,653 | ||||||||||||||||||||||||
Net Interest Margin, annualized | 3.02 | % | 2.90 | % | 2.77 | % | 3.04 | % | 3.08 | % | |||||||||||||||||||
Net Interest Margin, Tax-Equivalent, annualized 3 | 3.05 | % | 2.93 | % | 2.80 | % | 3.07 | % | 3.12 | % | |||||||||||||||||||
Efficiency Ratio Calculation: 4 | |||||||||||||||||||||||||||||
Noninterest Expense | $ | 20,345 | $ | 18,945 | $ | 20,860 | $ | 19,423 | $ | 19,087 | |||||||||||||||||||
Less: Intangible Asset Amortization | 48 | 49 | 52 | 51 | 53 | ||||||||||||||||||||||||
Net Noninterest Expense | $ | 20,297 | $ | 18,896 | $ | 20,808 | $ | 19,372 | $ | 19,034 | |||||||||||||||||||
Net Interest Income, Tax-Equivalent | $ | 29,307 | $ | 28,095 | $ | 27,487 | $ | 28,930 | $ | 28,653 | |||||||||||||||||||
Noninterest Income | 7,744 | 8,162 | 7,589 | 7,694 | 8,478 | ||||||||||||||||||||||||
Less: Net (Loss) Gain on Securities | 154 | 130 | (139) | (106) | 196 | ||||||||||||||||||||||||
Net Gross Income | $ | 36,897 | $ | 36,127 | $ | 35,215 | $ | 36,730 | $ | 36,935 | |||||||||||||||||||
Efficiency Ratio | 55.01 | % | 52.30 | % | 59.09 | % | 52.74 | % | 51.53 | % | |||||||||||||||||||
Period-End Capital Information: | |||||||||||||||||||||||||||||
Total Stockholders' Equity (i.e. Book Value) | $ | 356,498 | $ | 357,243 | $ | 371,186 | $ | 360,171 | $ | 353,033 | |||||||||||||||||||
Book Value per Share 1 | 22.25 | 22.31 | 23.14 | 22.48 | 22.01 | ||||||||||||||||||||||||
Goodwill and Other Intangible Assets, net | 23,583 | 23,691 | 23,791 | 23,879 | 23,955 | ||||||||||||||||||||||||
Tangible Book Value per Share 1,2 | 20.78 | 20.83 | 21.66 | 20.99 | 20.52 | ||||||||||||||||||||||||
Capital Ratios:5 | |||||||||||||||||||||||||||||
Tier 1 Leverage Ratio | 9.60 | % | 9.37 | % | 9.20 | % | 9.39 | % | 9.29 | % | |||||||||||||||||||
Common Equity Tier 1 Capital Ratio | 13.14 | % | 13.48 | % | 13.77 | % | 13.71 | % | 13.79 | % | |||||||||||||||||||
Tier 1 Risk-Based Capital Ratio | 13.86 | % | 14.23 | % | 14.55 | % | 14.51 | % | 14.61 | % | |||||||||||||||||||
Total Risk-Based Capital Ratio | 14.93 | % | 15.33 | % | 15.69 | % | 15.66 | % | 15.78 | % | |||||||||||||||||||
Assets Under Trust Admin. & Investment Mgmt. | $ | 1,589,178 | $ | 1,793,747 | $ | 1,851,101 | $ | 1,778,659 | $ | 1,804,854 |
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 24, 2021, 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 Arrow believes provides investors with information that is useful in understanding its financial performance. | |||||||||||||||||||||||||||||||
6/30/2022 | 3/31/2022 | 12/31/2021 | 9/30/2021 | 6/30/2021 | ||||||||||||||||||||||||||||
Total Stockholders' Equity (GAAP) | $ | 356,498 | $ | 357,243 | $ | 371,186 | $ | 360,171 | $ | 353,033 | ||||||||||||||||||||||
Less: Goodwill and Other Intangible assets, net | 23,583 | 23,691 | 23,791 | 23,879 | 23,955 | |||||||||||||||||||||||||||
Tangible Equity (Non-GAAP) | $ | 332,915 | $ | 333,552 | $ | 347,395 | $ | 336,292 | $ | 329,078 | ||||||||||||||||||||||
Period End Shares Outstanding | 16,023 | 16,013 | 16,041 | 16,020 | 16,039 | |||||||||||||||||||||||||||
Tangible Book Value per Share (Non-GAAP) | $ | 20.78 | $ | 20.83 | $ | 21.66 | $ | 20.99 | $ | 20.52 | ||||||||||||||||||||||
Net Income | 11,974 | 12,575 | 10,309 | 12,989 | 13,279 | |||||||||||||||||||||||||||
Return on Average Tangible Equity (Net Income/Tangible Equity - Annualized) | 14.40 | % | 14.72 | % | 12.01 | % | 15.36 | % | 16.32 | % | ||||||||||||||||||||||
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 Arrow believes provides investors with information that is useful in understanding its financial performance. | |||||||||||||||||||||||||||||||
6/30/2022 | 3/31/2022 | 12/31/2021 | 9/30/2021 | 6/30/2021 | ||||||||||||||||||||||||||||
Interest Income (GAAP) | $ | 30,593 | $ | 28,947 | $ | 28,354 | $ | 29,807 | $ | 29,695 | ||||||||||||||||||||||
Add: Tax-Equivalent adjustment | 269 | 270 | 285 | 292 | 293 | |||||||||||||||||||||||||||
Interest Income - Tax Equivalent | $ | 30,862 | $ | 29,217 | $ | 28,639 | $ | 30,099 | $ | 29,988 | ||||||||||||||||||||||
Net Interest Income (GAAP) | $ | 29,038 | $ | 27,825 | $ | 27,202 | $ | 28,638 | $ | 28,360 | ||||||||||||||||||||||
Add: Tax-Equivalent adjustment | 269 | 270 | 285 | 292 | 293 | |||||||||||||||||||||||||||
Net Interest Income - Tax Equivalent | $ | 29,307 | $ | 28,095 | $ | 27,487 | $ | 28,930 | $ | 28,653 | ||||||||||||||||||||||
Average Earning Assets | $ | 3,858,837 | $ | 3,886,787 | $ | 3,894,287 | $ | 3,734,206 | $ | 3,688,572 | ||||||||||||||||||||||
Net Interest Margin (Non-GAAP)* | 3.05 | % | 2.93 | % | 2.80 | % | 3.07 | % | 3.12 | % | ||||||||||||||||||||||
4. | Non-GAAP Financial Measures: Financial Institutions often use the "efficiency ratio", a non-GAAP ratio, as a measure of expense control. Arrow believes the efficiency ratio provides investors with information that is useful in understanding its financial performance. Arrow defines efficiency ratio as the ratio of noninterest expense to net gross income (which equals 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, 2022 listed in the tables (i.e., 13.14%) exceeds the sum of the required minimum CET1 ratio plus the fully phased-in Capital Conservation Buffer (i.e., 7.00%). | |||||||||||||||||||||||||||||||
6/30/2022 | 3/31/2022 | 12/31/2021 | 9/30/2021 | 6/30/2021 | ||||||||||||||||||||||||||||
Total Risk Weighted Assets | $ | 2,790,520 | $ | 2,661,952 | $ | 2,552,812 | $ | 2,511,910 | $ | 2,438,445 | ||||||||||||||||||||||
Common Equity Tier 1 Capital | 366,798 | 358,738 | 351,497 | 344,507 | 336,265 | |||||||||||||||||||||||||||
Common Equity Tier 1 Ratio | 13.14 | % | 13.48 | % | 13.77 | % | 13.71 | % | 13.79 | % | ||||||||||||||||||||||
* Quarterly ratios have been annualized. |
Arrow Financial Corporation | |||||||||||||||||||||||||||||||||||||
Average Consolidated Balance Sheets and Net Interest Income Analysis | |||||||||||||||||||||||||||||||||||||
(Dollars in Thousands - Unaudited) | |||||||||||||||||||||||||||||||||||||
Quarter Ended June 30: | 2022 | 2021 | |||||||||||||||||||||||||||||||||||
Interest | Rate | Interest | Rate | ||||||||||||||||||||||||||||||||||
Average | Income/ | Earned/ | Average | Income/ | Earned/ | ||||||||||||||||||||||||||||||||
Balance | Expense | Paid | Balance | Expense | Paid | ||||||||||||||||||||||||||||||||
Interest-Bearing Deposits at Banks | $ | 232,545 | $ | 427 | 0.74 | % | $ | 369,034 | $ | 103 | 0.11 | % | |||||||||||||||||||||||||
Investment Securities: | |||||||||||||||||||||||||||||||||||||
Fully Taxable | 644,443 | 2,444 | 1.52 | 479,365 | 1,671 | 1.40 | |||||||||||||||||||||||||||||||
Exempt from Federal Taxes | 177,669 | 816 | 1.84 | 188,724 | 907 | 1.93 | |||||||||||||||||||||||||||||||
Loans | 2,804,180 | 26,906 | 3.85 | 2,651,449 | 27,014 | 4.09 | |||||||||||||||||||||||||||||||
Total Earning Assets | 3,858,837 | 30,593 | 3.18 | 3,688,572 | 29,695 | 3.23 | |||||||||||||||||||||||||||||||
Allowance for Credit Losses | (27,558) | (26,862) | |||||||||||||||||||||||||||||||||||
Cash and Due From Banks | 40,105 | 34,976 | |||||||||||||||||||||||||||||||||||
Other Assets | 141,615 | 155,235 | |||||||||||||||||||||||||||||||||||
Total Assets | $ | 4,012,999 | $ | 3,851,921 | |||||||||||||||||||||||||||||||||
Deposits: | |||||||||||||||||||||||||||||||||||||
Interest-Bearing Checking Accounts | $ | 1,048,752 | 199 | 0.08 | $ | 924,651 | 192 | 0.08 | |||||||||||||||||||||||||||||
Savings Deposits | 1,541,616 | 892 | 0.23 | 1,481,232 | 501 | 0.14 | |||||||||||||||||||||||||||||||
Time Deposits of $250,000 or More | 37,418 | 26 | 0.28 | 95,673 | 69 | 0.29 | |||||||||||||||||||||||||||||||
Other Time Deposits | 130,361 | 111 | 0.34 | 145,448 | 156 | 0.43 | |||||||||||||||||||||||||||||||
Total Interest-Bearing Deposits | 2,758,147 | 1,228 | 0.18 | 2,647,004 | 918 | 0.14 | |||||||||||||||||||||||||||||||
Short-Term Borrowings | — | — | 4,770 | 1 | 0.08 | ||||||||||||||||||||||||||||||||
FHLBNY Term Advances & Other Long-Term Debt | 45,000 | 279 | 2.49 | 65,000 | 367 | 2.26 | |||||||||||||||||||||||||||||||
Finance Leases | 5,140 | 48 | 3.75 | 5,187 | 49 | 3.79 | |||||||||||||||||||||||||||||||
Total Interest-Bearing Liabilities | 2,808,287 | 1,555 | 0.22 | 2,721,961 | 1,335 | 0.20 | |||||||||||||||||||||||||||||||
Noninterest-bearing deposits | 811,607 | 748,267 | |||||||||||||||||||||||||||||||||||
Other Liabilities | 35,877 | 31,490 | |||||||||||||||||||||||||||||||||||
Total Liabilities | 3,655,771 | 3,501,718 | |||||||||||||||||||||||||||||||||||
Stockholders' Equity | 357,228 | 350,203 | |||||||||||||||||||||||||||||||||||
Total Liabilities and Stockholders' Equity | $ | 4,012,999 | $ | 3,851,921 | |||||||||||||||||||||||||||||||||
Net Interest Income | $ | 29,038 | $ | 28,360 | |||||||||||||||||||||||||||||||||
Net Interest Spread | 2.96 | % | 3.03 | % | |||||||||||||||||||||||||||||||||
Net Interest Margin | 3.02 | % | 3.08 | % | |||||||||||||||||||||||||||||||||
Arrow Financial Corporation | |||||||||||||||||
Consolidated Financial Information | |||||||||||||||||
(Dollars in Thousands - Unaudited) | |||||||||||||||||
Quarter Ended: | 6/30/2022 | 12/31/2021 | 6/30/2021 | ||||||||||||||
Loan Portfolio | |||||||||||||||||
Commercial Loans | $ | 138,675 | $ | 172,518 | $ | 242,790 | |||||||||||
Commercial Real Estate Loans | 663,234 | 628,929 | 598,241 | ||||||||||||||
Subtotal Commercial Loan Portfolio | 801,909 | 801,447 | 841,031 | ||||||||||||||
Consumer Loans | 1,031,111 | 920,556 | 892,549 | ||||||||||||||
Residential Real Estate Loans | 1,011,782 | 945,938 | 910,502 | ||||||||||||||
Total Loans | $ | 2,844,802 | $ | 2,667,941 | $ | 2,644,082 | |||||||||||
Allowance for Credit Losses | |||||||||||||||||
Allowance for Credit Losses, Beginning of Quarter | $ | 27,661 | $ | 26,956 | $ | 26,840 | |||||||||||
Loans Charged-off | (907) | (719) | (443) | ||||||||||||||
Less Recoveries of Loans Previously Charged-off | 431 | 486 | 350 | ||||||||||||||
Net Loans Charged-off | (476) | (233) | (93) | ||||||||||||||
Provision for Credit Losses | 905 | 558 | 263 | ||||||||||||||
Allowance for Credit Losses, End of Quarter | $ | 28,090 | $ | 27,281 | $ | 27,010 | |||||||||||
Nonperforming Assets | |||||||||||||||||
Nonaccrual Loans | $ | 7,999 | $ | 10,764 | $ | 7,102 | |||||||||||
Loans Past Due 90 or More Days and Accruing | 1,641 | 823 | 595 | ||||||||||||||
Loans Restructured and in Compliance with Modified Terms | 77 | 77 | 78 | ||||||||||||||
Total Nonperforming Loans | 9,717 | 11,664 | 7,775 | ||||||||||||||
Repossessed Assets | 297 | 126 | 99 | ||||||||||||||
Other Real Estate Owned | — | — | 99 | ||||||||||||||
Total Nonperforming Assets | $ | 10,014 | $ | 11,790 | $ | 7,973 | |||||||||||
Key Asset Quality Ratios | |||||||||||||||||
Net Loans Charged-off to Average Loans, | 0.07 | % | 0.03 | % | 0.01 | % | |||||||||||
Provision for Credit Losses to Average Loans, | 0.13 | % | 0.08 | % | 0.04 | % | |||||||||||
Allowance for Credit Losses to Period-End Loans | 0.99 | % | 1.02 | % | 1.02 | % | |||||||||||
Allowance for Credit Losses to Period-End Nonperforming Loans | 289.08 | % | 233.89 | % | 347.40 | % | |||||||||||
Nonperforming Loans to Period-End Loans | 0.34 | % | 0.44 | % | 0.29 | % | |||||||||||
Nonperforming Assets to Period-End Assets | 0.25 | % | 0.29 | % | 0.20 | % | |||||||||||
Six Month Period Ended: | |||||||||||||||||
Allowance for Loan Losses | |||||||||||||||||
Allowance for Loan Losses, Beginning of Year | $ | 27,281 | $ | 29,232 | |||||||||||||
Impact of the Adoption of ASU 2016-13 | — | (1,300) | |||||||||||||||
Loans Charged-off | (1,736) | (1,076) | |||||||||||||||
Less Recoveries of Loans Previously Charged-off | 871 | 539 | |||||||||||||||
Net Loans Charged-off | (865) | (537) | |||||||||||||||
Provision for Loan Losses | 1,674 | (385) | |||||||||||||||
Allowance for Loan Losses, End of Period | $ | 28,090 | $ | 27,010 | |||||||||||||
Key Asset Quality Ratios | |||||||||||||||||
Net Loans Charged-off to Average Loans, Annualized | 0.06 | % | 0.04 | % | |||||||||||||
Provision for Loan Losses to Average Loans, Annualized | 0.12 | % | (0.03) | % |
View original content:https://www.prnewswire.com/news-releases/arrow-reports-12-0-million-in-q2-net-income-loan-growth-of-108-million-301594285.html
SOURCE Arrow Financial Corporation
We use cookies to tailor your experience, measure site performance and present relevant offers and advertisements. By clicking ‘Accept’ or any content on this site, you agree that cookies can be placed on your browser. You can view our privacy policy to learn more.
If you would like to get more data, alerts and access to Real Vision videos, join us as an Insider Tracking Advantage Ultra member