Trustco Caps Year of Efficiency, Strength, and Value - Reports Fourth Quarter 2024 Net Income of $11.3 Million; $48.8 Million for the Year

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Jan 21, 2025

Executive Snapshot:

  • Continued solid financial results:
    • Key metrics for the fourth quarter 2024:
      • Net income of $11.3 million versus $9.8 million for the fourth quarter 2023
      • Net interest income of $38.9 million, up from $38.6 million compared to the fourth quarter 2023
      • Return on average assets (ROAA) of 0.73% versus 0.64% for the fourth quarter 2023
      • Return on average equity (ROAE) of 6.70% versus 6.21% for the fourth quarter 2023
  • Capital continues to grow:
    • Consolidated equity to assets increased 3.6% to 10.84% as of December 31, 2024 from 10.46% as of December 31, 2023
    • Book value per share as of December 31, 2024 was $35.56, up from $33.92 as of December 31, 2023
  • Average Loan and Deposit portfolios continue to grow:

    • On average, total loans were up $104.9 million or 2.1% for the fourth quarter 2024 compared to the fourth quarter 2023
    • On average, total deposits were up $31.7 million or 0.6% for the fourth quarter 2024 compared to the fourth quarter 2023

GLENVILLE, N.Y., Jan. 21, 2025 (GLOBE NEWSWIRE) -- TrustCo Bank Corp NY (TrustCo, TRST) today announced fourth quarter 2024 net income of $11.3 million or $0.59 diluted earnings per share, compared to net income of $9.8 million or $0.52 diluted earnings per share for the fourth quarter 2023; and net income of $48.8 million or $2.57 diluted earnings per share for the full year 2024, compared to net income of $58.6 million or $3.08 diluted earnings per share for the full year 2023. Average loans increased $104.9 million or 2.1% for the fourth quarter 2024 over the same period in 2023. TrustCo continued to increase the balances of home equity lines of credit (HECLs) outstanding through an aggressive campaign to encourage existing customers to utilize their HECLs in place of higher rate loan products. The objective is to meet customer needs and encourage increased utilization through existing HECLs.

Overview

Chairman, President, and CEO, Robert J. McCormick said, “The story of Trustco Bank for 2024 is one of efficiency, strength, and shareholder value. For the year, we controlled costs, resisted the temptation to chase deposits with rate, improved our already strong capital position, and delivered a meaningful return to our owners in the form of dividends and price appreciation. Year over year, the Company’s quarterly net income, net interest income, return on average assets, and return on average equity all grew. Likewise, credit quality remained impressive and, in classic Home Town Bank fashion, we leveraged customer relationships to create lending volume in the form of home equity loans. We come into 2025 well-capitalized, liquid, and ready to lend.”

Details

Average loans were up $104.9 million, or 2.1%, in the fourth quarter 2024 over the same period in 2023. Average residential loans and home equity lines of credit, our primary lending focus, were up $34.9 million, or 0.8%, and $61.0 million, or 17.9%, respectively, in the fourth quarter 2024 over the same period in 2023. Average commercial loans also increased $11.7 million, or 4.3%, in the fourth quarter 2024 over the same period in 2023. Average deposits were up $31.7 million, or 0.6%, for the fourth quarter 2024 over the same period in 2023 primarily as a result of an increase in time deposits. We believe the increase in time deposits compared to the same period in 2023 continues to reflect the desire of customers to have additional funds in the safety and security offered by TrustCo’s long history of conservative banking, while earning a competitive interest rate. As we move forward, the objective is to encourage customers to retain these additional funds in the expanded product offerings of Trustco Bank (the “Bank”) through aggressive marketing and product differentiation.

Net interest income was $38.9 million for the fourth quarter 2024, an increase of $295 thousand, or 0.8%, compared to the fourth quarter of 2023, driven by loan growth at higher interest rates, partially offset by lower investment interest income and a decrease in interest on federal funds sold and other short-term investments. The net interest margin for the fourth quarter 2024 was 2.15%, down 6 basis points from 2.21% in the fourth quarter of 2023. The yield on interest earnings assets increased to 4.12%, up 1 basis point from 4.11% in the third quarter of 2024, and up 19 basis points from 3.93% in the fourth quarter of 2023. The cost of interest bearing liabilities increased to 1.97% in the fourth quarter 2024, up only 3 basis points from 1.94% in the third quarter of 2024, and up from 1.72% in the fourth quarter 2023. The Federal Reserve’s decision in upcoming meetings will have an effect on the Bank’s ability to continue to manage deposit costs. Further reductions should help margin expansion in future quarters. Non-interest expense decreased $666 thousand over the fourth quarter of 2023, consistent with the decline in FTE’s over the last year.

Asset quality remains strong and has been consistent over the past twelve months. The Company recorded a provision for credit losses of $400 thousand in the fourth quarter of 2024, which is the result of a provision for credit losses on loans of $400 thousand. The ratio of allowance for credit losses on loans to total loans was 0.99% and 0.97% as of December 31, 2024 and 2023, respectively. The allowance for credit losses on loans was $50.2 million at December 31, 2024, compared to $48.6 million at December 31, 2023. Nonperforming loans (NPLs) were $18.8 million at December 31, 2024, compared to $17.7 million at December 31, 2023. NPLs were 0.37% and 0.35% of total loans at December 31, 2024 and 2023, respectively. The coverage ratio, or allowance for credit losses on loans to NPLs, was 267.3% at December 31, 2024, compared to 275.0% at December 31, 2023. Nonperforming assets (NPAs) were $21.0 million at December 31, 2024, compared to $21.9 million at September 30, 2024 and $17.9 million at December 31, 2023.

At December 31, 2024, our equity to asset ratio was 10.84%, compared to 10.46% at December 31, 2023. Book value per share at December 31, 2024 was $35.56, up 4.8% compared to $33.92 a year earlier.

A conference call to discuss fourth quarter 2024 results will be held at 9:00 a.m. Eastern Time on January 22, 2024. Those wishing to participate in the call may dial toll-free for the United States at 1-833-470-1428, and for Canada at 1-833-950-0062, Access code 645488. A replay of the call will be available for thirty days by dialing toll-free for the United States at 1-866-813-9403, Access code 619481. The call will also be audio webcast at https://events.q4inc.com/attendee/773359679, and will be available for one year.

About TrustCo Bank Corp NY

TrustCo Bank Corp NY is a $6.2 billion savings and loan holding company and through its subsidiary, Trustco Bank, operated 136 offices in New York, New Jersey, Vermont, Massachusetts, and Florida at December 31, 2024.

In addition, the Bank’s Wealth Management Department offers a full range of investment services, retirement planning and trust and estate administration services. The common shares of TrustCo are traded on the NASDAQ Global Select Market under the symbol TRST.

Forward-Looking Statements

All statements in this news release that are not historical are forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as "anticipate," "intend," "plan," "goal," "seek," "believe," "project," "estimate," "expect," "strategy," "future," "likely," "may," "should," "will" and similar references to future development, results or periods. Examples of forward-looking statements include, among others, statements we make regarding our expectations for our future performance, including our expectations regarding the effects of the economic environment on our financial results, our ability to retain customers and the amount of customers’ business, including deposit balances, with us, the impact of the Federal Reserve’s actions regarding interest rates, and the growth of loans and deposits throughout our branch network. Forward-looking statements are based on management’s current expectations as well as certain assumptions and estimates made by, and information available to, management at the time the statements are made. Such forward-looking statements are subject to factors and uncertainties that could cause actual results to differ materially for TrustCo from the views, beliefs and projections expressed in such statements, and many of the risks and uncertainties are heightened by or may, in the future, be heightened by volatility in financial markets and macroeconomic or geopolitical concerns related to inflation, continued elevated interest rates and ongoing armed conflicts (including the Russia/Ukraine conflict and the conflict in Israel and surrounding areas). TrustCo wishes to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The following important factors, among others, in some cases have affected and in the future could affect TrustCo’s actual results and could cause TrustCo’s actual financial performance to differ materially from that expressed in any forward-looking statement: future changes in interest rates; ongoing inflationary pressures and continued elevated prices; exposure to credit risk in our lending activities; our increasing commercial loan portfolio; the sufficiency of our allowance for credit losses on loans to cover actual loan losses; our ability to meet the cash flow requirements of our depositors or borrowers or meet our operating cash needs to fund corporate expansion and other activities; claims and litigation pertaining to fiduciary responsibility and lender liability; our dependency upon the services of the management team; our disclosure controls and procedures’ ability to prevent or detect errors or acts of fraud; the adequacy of our business continuity and disaster recovery plans; the effectiveness of our risk management framework; the impact of any expansion by us into new lines of business or new products and services; an increase in the prevalence of fraud and other financial crimes; the impact of severe weather events and climate change on us and the communities we serve, including societal responses to climate change; increasing scrutiny and evolving expectations from customers, regulators, investors, and other stakeholders with respect to our environmental, social and governance practices; the chance of a prolonged economic downturn, especially one affecting our geographic market area; instability in global economic conditions and geopolitical matters, as well as volatility in financial markets; the soundness of other financial institutions; U.S. government shutdowns, credit rating downgrades, or failure to increase the debt ceiling; fluctuations in the trust wealth management fees we receive as a result of investment performance; the impact of regulatory capital rules on our growth; changes in laws and regulations, including changes in cybersecurity or privacy regulations; restrictions on data collection and use; our compliance with the USA PATRIOT Act, Bank Secrecy Act, and other laws and regulations that could result in material fines or sanctions; changes in tax laws; limitations on our ability to pay dividends; TrustCo Realty Corp.’s ability to qualify as a real estate investment trust; changes in accounting standards; competition within our market areas; consumers and businesses’ use of non-banks to complete financial transactions; our reliance on third-party service providers; the impact of data breaches and cyber-attacks; the impact of a failure in or breach of our operational or security systems or infrastructure, or those of third parties; the impact of an unauthorized disclosure of sensitive or confidential client or customer information; the impact of interruptions in the effective operation of our computer systems; the adoption of artificial intelligence tools by us and/or our third-party vendors and service providers; the impact of anti-takeover provisions in our organizational documents; the impact of the manner in which we allocate capital; and other risks and uncertainties under the heading “Risk Factors” in our most recent annual report on Form 10-K and, if any, in our subsequent quarterly reports on Form 10-Q or other securities filings, including our upcoming annual report on Form 10-K for fiscal 2024. The forward-looking statements contained in this news release represent TrustCo management’s judgment as of the date of this news release. TrustCo disclaims, however, any intent or obligation to update forward-looking statements, either as a result of future developments, new information or otherwise, except as may be required by law.

Subsidiary: Trustco Bank

Contact:
Robert Leonard
Executive Vice President
(518) 381-3693

TRUSTCO BANK CORP NY
GLENVILLE, NY
FINANCIAL HIGHLIGHTS
(dollars in thousands, except per share data)
(Unaudited)
Three months ended
12/31/20249/30/202412/31/2023
Summary of operations
Net interest income$38,902$38,671$38,607
Provision for credit losses4005001,350
Net gains on equity securities-23-
Noninterest income, excluding net gains on equity securities4,4094,9084,474
Noninterest expense28,16526,20028,831
Net income11,28112,8759,848
Per share
Net income per share:
- Basic$0.59$0.68$0.52
- Diluted0.590.680.52
Cash dividends0.360.360.36
Book value at period end35.5635.1933.92
Market price at period end33.3133.0731.05
At period end
Full time equivalent employees737735750
Full service banking offices136138140
Performance ratios
Return on average assets0.73% 0.84% 0.64
Return on average equity6.707.746.21
Efficiency ratio (1)65.0360.0966.92
Adjusted Efficiency ratio (1)63.9359.6560.16
Net interest spread2.152.172.21
Net interest margin2.602.612.60
Dividend payout ratio60.7053.1669.54
Capital ratios at period end
Consolidated equity to assets10.84% 10.95% 10.46
Consolidated tangible equity to tangible assets (1)10.83% 10.94% 10.45
Asset quality analysis at period end
Nonperforming loans to total loans0.37% 0.38% 0.35
Nonperforming assets to total assets0.340.360.29
Allowance for credit losses on loans to total loans0.990.990.97
Coverage ratio (2)2.7x2.6x2.7x
(1) Non-GAAP Financial Measure, see Non-GAAP Financial Measures Reconciliation.
(2) Calculated as allowance for credit losses on loans divided by total nonperforming loans.
FINANCIAL HIGHLIGHTS, Continued
(dollars in thousands, except per share data)
(Unaudited)
Year Ended
12/31/2412/31/23
Summary of operations
Net interest income$151,939171,845
Provision for credit losses2,0001,250
Net gains on equity securities1,383-
Noninterest income, excluding net gains on equity securities18,45118,315
Noninterest expense105,727111,297
Net income48,83358,646
Per share
Net income per share:
- Basic$2.573.08
- Diluted2.573.08
Cash dividends1.441.44
Book value at period end35.5633.92
Market price at period end33.3131.05
Performance ratios
Return on average assets0.80% 0.97
Return on average equity7.439.46
Efficiency ratio (1)61.5558.53
Adjusted Efficiency ratio (1)61.6056.72
Net interest spread2.102.64
Net interest margin2.542.91
Dividend payout ratio56.0946.71
(1) Non-GAAP Financial Measure, see Non-GAAP Financial Measures Reconciliation.
CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except per share data)
(Unaudited)
Three months ended
12/31/20249/30/20246/30/20243/31/202412/31/2023
Interest and dividend income:
Interest and fees on loans$53,024$52,112$50,660$49,804$49,201
Interest and dividends on securities available for sale:
U. S. government sponsored enterprises680718909906750
State and political subdivisions--1-1
Mortgage-backed securities and collateralized mortgage
obligations - residential1,4181,3971,4511,4941,533
Corporate bonds358361362476477
Small Business Administration - guaranteed
participation securities849094100102
Other securities62233
Total interest and dividends on securities available for sale2,5462,5682,8192,9792,866
Interest on held to maturity securities:
obligations - residential5962656870
Total interest on held to maturity securities5962656870
Federal Home Loan Bank stock152153147152149
Interest on federal funds sold and other short-term investments6,1286,1746,8946,7506,354
Total interest income61,90961,06960,58559,75358,640
Interest expense:
Interest on deposits:
Interest-bearing checking397311288240165
Savings719770675712707
Money market deposit accounts2,0242,1542,2282,3422,500
Time deposits19,68018,96919,40019,67716,460
Interest on short-term borrowings187194206204201
Total interest expense23,00722,39822,79723,17520,033
Net interest income38,90238,67137,78836,57838,607
Less: Provision for credit losses4005005006001,350
Net interest income after provision for credit losses38,50238,17137,28835,97837,257
Noninterest income:
Trustco Financial Services income1,7782,0441,6091,8161,612
Fees for services to customers2,2262,4822,3992,7452,563
Net gains on equity securities-231,360--
Other405382283282299
Total noninterest income4,4094,9315,6514,8434,474
Noninterest expenses:
Salaries and employee benefits12,06812,13412,52011,42712,444
Net occupancy expense4,5634,2714,3754,6114,209
Equipment expense2,4041,7571,9901,7381,852
Professional services1,7821,8631,5701,4601,561
Outsourced services3,0512,5512,7552,5012,532
Advertising expense590339466408384
FDIC and other insurance1,1131,1127971,0941,085
Other real estate expense (income), net4762041674(12)
Other2,1181,9691,9701,5904,776
Total noninterest expenses28,16526,20026,45924,90328,831
Income before taxes14,74616,90216,48015,91812,900
Income taxes3,4654,0273,9293,7923,052
Net income$11,281$12,875$12,551$12,126$9,848
Net income per common share:
- Basic$0.59$0.68$0.66$0.64$0.52
- Diluted0.590.680.660.640.52
Average basic shares (in thousands)19,01519,01019,02219,02419,024
Average diluted shares (in thousands)19,04519,03619,03319,03219,026
CONSOLIDATED STATEMENTS OF INCOME, Continued
(dollars in thousands, except per share data)
(Unaudited)
Year Ended
12/31/2412/31/23
Interest and dividend income:
Interest and fees on loans$205,600187,456
Interest and dividends on securities available for sale:
U. S. government sponsored enterprises3,2132,805
State and political subdivisions12
Mortgage-backed securities and collateralized mortgage
obligations - residential5,7606,146
Corporate bonds1,5571,987
Small Business Administration - guaranteed
participation securities368437
Other securities1310
Total interest and dividends on securities available for sale10,91211,387
Interest on held to maturity securities:
Mortgage-backed securities-residential254296
Total interest on held to maturity securities254296
Federal Home Loan Bank stock604500
Interest on federal funds sold and other short-term investments25,94626,567
Total interest income243,316226,206
Interest expense:
Interest on deposits:
Interest-bearing checking1,236382
Savings2,8762,531
Money market deposit accounts8,7487,454
Time deposits77,72642,985
Interest on short-term borrowings7911,009
Total interest expense91,37754,361
Net interest income151,939171,845
Less: Provision for credit losses2,0001,250
Net interest income after provision for credit losses149,939170,595
Noninterest income:
Trustco Financial Services income7,2476,425
Fees for services to customers9,85210,648
Net gains on equity securities1,383-
Other1,3521,242
Total noninterest income19,83418,315
Noninterest expenses:
Salaries and employee benefits48,14951,242
Net occupancy expense17,82017,427
Equipment expense7,8897,610
Professional services6,6756,245
Outsourced services10,85810,039
Advertising expense1,8031,878
FDIC and other insurance4,1164,300
Other real estate expense, net770524
Other7,64712,032
Total noninterest expenses105,727111,297
Income before taxes64,04677,613
Income taxes15,21318,967
Net income$48,83358,646
Net income per common share:
- Basic$2.573.08
- Diluted2.573.08
Average basic shares (in thousands)19,01819,024
Average diluted shares (in thousands)19,03719,025
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(dollars in thousands)
(Unaudited)
12/31/20249/30/20246/30/20243/31/202412/31/2023
ASSETS:
Cash and due from banks$47,364$49,659$42,193$44,868$49,274
Federal funds sold and other short term investments594,448473,306493,920564,815528,730
Total cash and cash equivalents641,812522,965536,113609,683578,004
Securities available for sale:
U. S. government sponsored enterprises85,61790,588106,796128,854118,668
States and political subdivisions1826262626
Mortgage-backed securities and collateralized mortgage
obligations - residential213,128222,841218,311227,078237,677
Small Business Administration - guaranteed
participation securities14,14115,17115,59216,26017,186
Corporate bonds44,58154,32753,76453,34178,052
Other securities700701688682680
Total securities available for sale358,185383,654395,177426,241452,289
Held to maturity securities:
Mortgage-backed securities and collateralized mortgage
obligations-residential5,3655,6365,9216,2066,458
Total held to maturity securities5,3655,6365,9216,2066,458
Federal Reserve Bank and Federal Home Loan Bank stock6,5076,5076,5076,2036,203
Loans:
Commercial286,857280,261282,441279,092273,515
Residential mortgage loans4,388,3024,382,6744,370,6404,354,3694,365,063
Home equity line of credit409,261393,418370,063355,879347,415
Installment loans13,63814,50315,16816,16616,886
Loans, net of deferred net costs5,098,0585,070,8565,038,3125,005,5065,002,879
Less: Allowance for credit losses on loans50,24849,95049,77249,22048,578
Net loans5,047,8105,020,9064,988,5404,956,2864,954,301
Bank premises and equipment, net33,78233,32433,46633,42334,007
Operating lease right-of-use assets36,62737,95838,37639,64740,542
Other assets108,65698,730102,544101,88196,387
Total assets$6,238,744$6,109,680$6,106,644$6,179,570$6,168,191
LIABILITIES:
Deposits:
Demand$762,101$753,878$745,227$742,997$754,532
Interest-bearing checking1,027,540988,5271,029,6061,020,1361,015,213
Savings accounts1,086,5341,092,0381,144,4271,155,5171,179,241
Money market deposit accounts465,049477,113517,445532,611565,767
Time deposits2,049,7591,952,6351,840,2621,903,9081,836,024
Total deposits5,390,9835,264,1915,276,9675,355,1695,350,777
Short-term borrowings84,78191,45089,72094,37488,990
Operating lease liabilities40,15941,46942,02643,43844,471
Accrued expenses and other liabilities46,47843,54942,76337,39938,668
Total liabilities5,562,4015,440,6595,451,4765,530,3805,522,906
SHAREHOLDERS' EQUITY:
Capital stock20,09720,05820,05820,05820,058
Surplus258,874257,644257,490257,335257,181
Undivided profits446,503442,079436,048430,346425,069
Accumulated other comprehensive loss, net of tax(3,861)(6,600)(14,268)(14,763)(13,237)
Treasury stock at cost(45,270)(44,160)(44,160)(43,786)(43,786)
Total shareholders' equity676,343669,021655,168649,190645,285
Total liabilities and shareholders' equity$6,238,744$6,109,680$6,106,644$6,179,570$6,168,191
Outstanding shares (in thousands)19,02019,01019,01019,02419,024
NONPERFORMING ASSETS
(dollars in thousands)
(Unaudited)
12/31/20249/30/20246/30/20243/31/202412/31/2023
Nonperforming Assets
New York and other states*
Loans in nonaccrual status:
Commercial$343$466$741$532$536
Real estate mortgage - 1 to 4 family14,67115,32014,99214,35914,375
Installment108163131149151
Total non-accrual loans15,12215,94915,86415,04015,062
Other nonperforming real estate mortgages - 1 to 4 family----3
Total nonperforming loans15,12215,94915,86415,04015,065
Other real estate owned2,1752,5032,3342,334194
Total nonperforming assets$17,297$18,452$18,198$17,374$15,259
Florida
Loans in nonaccrual status:
Commercial$-$314$314$314$314
Real estate mortgage - 1 to 4 family3,6563,1762,9852,9212,272
Installment22522-15
Total non-accrual loans3,6783,4953,3213,2352,601
Other nonperforming real estate mortgages - 1 to 4 family-----
Total nonperforming loans3,6783,4953,3213,2352,601
Other real estate owned-----
Total nonperforming assets$3,678$3,495$3,321$3,235$2,601
Total
Loans in nonaccrual status:
Commercial$343$780$1,055$846$850
Real estate mortgage - 1 to 4 family18,32718,49617,97717,28016,647
Installment130168153149166
Total non-accrual loans18,80019,44419,18518,27517,663
Other nonperforming real estate mortgages - 1 to 4 family----3
Total nonperforming loans18,80019,44419,18518,27517,666
Other real estate owned2,1752,5032,3342,334194
Total nonperforming assets$20,975$21,947$21,519$20,609$17,860
Quarterly Net Chargeoffs (Recoveries)
New York and other states*
Commercial$62$65$-$-$-
Real estate mortgage - 1 to 4 family(316)104(74)(78)219
Installment4111(2)3623
Total net (recoveries) chargeoffs$(213)$180$(76)$(42)$242
Florida
Commercial$314$-$-$-$-
Real estate mortgage - 1 to 4 family--17--
Installment1427-6
Total net chargeoffs$315$42$24$-$6
Total
Commercial$376$65$-$-$-
Real estate mortgage - 1 to 4 family(316)104(57)(78)219
Installment425353629
Total net chargeoffs (recoveries)$102$222$(52)$(42)$248
Asset Quality Ratios
Total nonperforming loans (1)$18,800$19,444$19,185$18,275$17,666
Total nonperforming assets (1)20,97521,94721,51920,60917,860
Total net chargeoffs (recoveries) (2)102222(52)(42)248
Allowance for credit losses on loans (1)50,24849,95049,77249,22048,578
Nonperforming loans to total loans0.37%0.38%0.38%0.37%0.35%
Nonperforming assets to total assets0.34%0.36%0.35%0.33%0.29%
Allowance for credit losses on loans to total loans0.99%0.99%0.99%0.98%0.97%
Coverage ratio (1)267.3%256.9%259.4%269.3%275.0%
Annualized net (recoveries) chargeoffs to average loans (2)0.01%0.02%0.00%0.00%0.02%
Allowance for credit losses on loans to annualized net chargeoffs (2)123.2x56.3xN/AN/A49.0x
* Includes New York, New Jersey, Vermont and Massachusetts.
(1) At period-end
(2) For the three-month period ended
DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY -
INTEREST RATES AND INTEREST DIFFERENTIAL
(dollars in thousands)
(Unaudited)Three months endedThree months ended
December 31, 2024December 31, 2023
AverageInterestAverageAverageInterestAverage
BalanceRateBalanceRate
Assets
Securities available for sale:
U. S. government sponsored enterprises$88,125$6803.09%$125,572$7502.39%
Mortgage backed securities and collateralized mortgage
obligations - residential238,7711,4182.36267,3411,5332.28
State and political subdivisions23-6.353216.62
Corporate bonds50,0253582.8680,2074772.38
Small Business Administration - guaranteed
participation securities15,693842.1518,9901022.15
Other70063.4368931.74
Total securities available for sale393,3372,5462.59492,8312,8662.33
Federal funds sold and other short-term Investments504,4586,1284.83461,8896,3545.46
Held to maturity securities:
Mortgage backed securities and collateralized mortgage
obligations - residential5,501594.316,591704.25
Total held to maturity securities5,501594.316,591704.25
Federal Home Loan Bank stock6,5071529.346,2031499.61
Commercial loans285,3033,8695.42273,6223,5895.25
Residential mortgage loans4,388,56742,4863.874,353,66040,0093.68
Home equity lines of credit401,6366,4226.36340,6705,3386.22
Installment loans13,7412477.1416,3592656.44
Loans, net of unearned income5,089,24753,0244.164,984,31149,2013.94
Total interest earning assets5,999,050$61,9094.125,951,825$58,6403.93
Allowance for credit losses on loans(50,342)(47,458)
Cash & non-interest earning assets190,341169,791
Total assets$6,139,049$6,074,158
Liabilities and shareholders' equity
Deposits:
Interest bearing checking accounts$994,786$3970.16%$1,004,744$1650.07%
Money market accounts469,7842,0241.71586,0252,5001.69
Savings1,085,9527190.261,205,3887070.23
Time deposits2,000,56319,6803.911,720,87116,4603.79
Total interest bearing deposits4,551,08522,8201.994,517,02819,8321.74
Short-term borrowings84,1361870.8892,5292010.86
Total interest bearing liabilities4,635,221$23,0071.974,609,557$20,0331.72
Demand deposits751,747754,078
Other liabilities82,73881,297
Shareholders' equity669,343629,226
Total liabilities and shareholders' equity$6,139,049$6,074,158
Net interest income$38,902$38,607
Net interest spread2.15%2.21%
Net interest margin (net interest income to
total interest earning assets)2.60%2.60%
DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY -
INTEREST RATES AND INTEREST DIFFERENTIAL, Continued
(dollars in thousands)
(Unaudited)Year EndedYear Ended
December 31, 2024December 31, 2023
AverageInterestAverageAverageInterestAverage
BalanceRateBalanceRate
Assets
Securities available for sale:
U. S. government sponsored enterprises $105,7293,2133.04% $121,5742,8052.31%
Mortgage backed securities and collateralized mortgage
obligations - residential247,4665,7602.33275,5656,1462.23
State and political subdivisions2516.693326.71
Corporate bonds58,4471,5572.6682,8651,9872.40
Small Business Administration - guaranteed
participation securities17,0033682.1720,4104372.14
Other698131.86686101.46
Total securities available for sale429,36810,9122.54501,13311,3872.27
Federal funds sold and other short-term Investments493,54625,9465.26521,02126,5675.10
Held to maturity securities:
Mortgage backed securities and collateralized mortgage
obligations - residential5,9162544.297,0532964.20
Total held to maturity securities5,9162544.297,0532964.20
Federal Home Loan Bank stock6,3896049.456,0185008.31
Commercial loans280,56615,1015.38255,66613,3065.20
Residential mortgage loans4,370,582165,5333.794,290,241154,2353.60
Home equity lines of credit374,84123,9446.39313,91418,9366.03
Installment loans14,9261,0226.8515,3459796.38
Loans, net of unearned income5,040,915205,6004.084,875,166187,4563.84
Total interest earning assets5,976,134243,3164.075,910,391226,2063.83
Allowance for credit losses on loans(49,648)(46,971)
Cash & non-interest earning assets188,748172,641
Total assets $6,115,234 $6,036,061
Liabilities and shareholders' equity
Deposits:
Interest bearing checking accounts $998,5011,2360.12% $1,067,9723820.04%
Money market accounts509,4098,7481.72606,2307,4541.23
Savings1,128,1902,8760.251,323,9952,5310.19
Time deposits1,911,11677,7264.071,437,33642,9852.99
Total interest bearing deposits4,547,21690,5861.994,435,53353,3521.20
Short-term borrowings89,7077910.88114,6391,0090.88
Total interest bearing liabilities4,636,92391,3771.974,550,17254,3611.19
Demand deposits738,816784,021
Other liabilities82,39881,656
Shareholders' equity657,097620,212
Total liabilities and shareholders' equity $6,115,234 $6,036,061
Net interest income151,939171,845
Net interest spread2.10%2.64%
Net interest margin (net interest income to
total interest earning assets)2.54%2.91%

Non-GAAP Financial Measures Reconciliation

Tangible book value per share is a non-GAAP financial measure derived from GAAP-based amounts. We calculate tangible book value by excluding the balance of intangible assets from total shareholders’ equity divided by shares outstanding. We believe that this is consistent with the treatment by bank regulatory agencies, which exclude intangible assets from the calculation of risk-based capital ratios. Additionally, we believe that this measure is important to many investors in the marketplace who are interested in relative changes from period to period in equity exclusive of changes in intangible assets.

Tangible equity as a percentage of tangible assets at period end is a non-GAAP financial measure derived from GAAP-based amounts. We calculate tangible equity and tangible assets by excluding the balance of intangible assets from total shareholders’ equity and total assets, respectively. We calculate tangible equity as a percentage of tangible assets at period end by dividing tangible equity by tangible assets at period end. We believe that this is consistent with the treatment by bank regulatory agencies, which exclude intangible assets from the calculation of risk-based capital ratios. Additionally, we believe that this measure is important to many investors in the marketplace who are interested in relative changes from period to period in equity and total assets, each exclusive of changes in intangible assets.

Net interest income is commonly presented on a taxable equivalent basis. That is, to the extent that some component of the institution’s net interest income will be exempt from taxation (e.g., was received by the institution as a result of its holdings of state or municipal obligations), an amount equal to the tax benefit derived from that component is added back to the net interest income total. Management considers this adjustment helpful to investors in comparing one financial institution’s net interest income (pre- tax) to that of another institution, as each will have a different proportion of tax-exempt items in their portfolios. Moreover, net interest income is itself a component of another financial measure commonly used by financial institutions, net interest margin, which is the ratio of net interest income to average interest earning assets. Additionally, management and many financial institutions also present net interest spread, which is the average yield on interest earning assets minus the average rate paid on interest bearing liabilities. For purposes of these measures as well, taxable equivalent net interest income is generally used by financial institutions, again to provide investors with a better basis of comparison from institution to institution. We calculate taxable equivalent net interest margin by dividing net interest income, adjusted to include the benefit of non-taxable interest income, by average interest earning assets. We calculate taxable equivalent net interest spread as the difference between average yield on interest earning assets, adjusted to include the benefit of non-taxable interest income, and the average rate paid on interest bearing liabilities.

The efficiency ratio and adjusted efficiency ratio are non-GAAP measures of expense control relative to revenue from net interest income and non-interest fee income. We calculate the efficiency ratio by dividing total non-interest expense by the sum of net interest income and total non-interest income. We calculate the adjusted efficiency ratio by dividing total noninterest expenses as determined under GAAP, excluding other real estate expense, net, strategic branch closing costs, and a non-recurring expense related to the settlement of a class action lawsuit, by net interest income and total noninterest income as determined under GAAP, excluding gain/loss on the disposal of assets from strategic branch closures from this calculation and net gains on equity securities. We believe that this provides a reasonable measure of primary banking expenses relative to primary banking revenue. Additionally, we believe this measure is important to investors looking for a measure of efficiency in our productivity measured by the amount of revenue generated for each dollar spent.

We believe that these non-GAAP financial measures provide information that is important to investors and that is useful in understanding our financial results. Our management internally assesses our performance based, in part, on these measures. However, these non-GAAP financial measures are supplemental and not a substitute for an analysis based on GAAP measures. As other companies may use different calculations for these measures, this presentation may not be comparable to other similarly titled measures reported by other companies. A reconciliation of the non-GAAP measures of tangible book value to shares outstanding, tangible equity as a percentage of tangible assets, and efficiency ratio to the most directly comparable GAAP measures is set forth below. We have not presented a reconciliation of taxable equivalent net interest income, taxable equivalent net interest margin or taxable equivalent net interest spread to the most directly comparable GAAP measure, as there was no difference between the taxable equivalent measure and comparable GAAP measure for any period presented in this release.

NON-GAAP FINANCIAL MEASURES RECONCILIATION
(dollars in thousands)
(Unaudited)
12/31/20249/30/202412/31/2023
Tangible Book Value Per Share
Equity (GAAP)$676,343$669,021$645,285
Less: Intangible assets553553553
Tangible equity (Non-GAAP)$675,790$668,468$644,732
Shares outstanding19,02019,01019,024
Tangible book value per share35.5335.1633.89
Book value per share35.5635.1933.92
Tangible Equity to Tangible Assets
Total Assets (GAAP)$6,238,744$6,109,680$6,168,191
Less: Intangible assets553553553
Tangible assets (Non-GAAP)$6,238,191$6,109,127$6,167,638
Tangible Equity to Tangible Assets (Non-GAAP)10.83%10.94%10.45%
Equity to Assets (GAAP)10.84%10.95%10.46%
Three months endedYear Ended
Efficiency and Adjusted Efficiency Ratios12/31/20249/30/20246/30/202412/31/202312/31/202412/31/2023
Net interest income (GAAP)A$38,902$38,671$37,788$38,607$151,939$171,845
Non-interest income (GAAP)B4,4094,9315,6514,47419,83418,315
Add: Non-recurring lossC---101-101
Less: Net gains on equity securitiesD-231,360-1,383-
Revenue used for efficiency ratio (Non-GAAP)E$43,311$43,579$42,079$43,182$170,390$190,261
Total noninterest expense (GAAP)F$28,165$26,200$26,459$28,831$105,727$111,297
Less: Branch closure expenseG---114-114
Less: Non-recurring expensesH---2,750-2,750
Less: Other real estate expense (income), netI47620416(12)770524
Expense used for efficiency ratio (Non-GAAP)J$27,689$25,996$26,443$25,979$104,957$107,909
Efficiency Ratio(F)/(A+B)65.03%60.09%60.91%66.92%61.55%58.53%
Adjusted Efficiency RatioJ/E63.93%59.65%62.84%60.16%61.60%56.72%
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