NBT Bancorp Inc. announced results that reflect productive growth in earning assets, deposits, and for a sixth consecutive quarter of net interest margin improvement. The company also reported on the merger with Evans Bancorp, which was completed in May. (Submitted photo)

NORWICH – NBT Bancorp Inc. (“NBT” or the “Company”) (NASDAQ: NBTB) reported net income and diluted earnings per share for the three and nine months ended September 30, 2025.

Net income for the third quarter of 2025 was $54.5 million, or $1.03 per diluted common share, compared to $38.1 million, or $0.80 per diluted common share, for the third quarter of 2024, and $22.5 million, or $0.44 per diluted common share, for the second quarter of 2025.

Operating diluted earnings per share(1), a non-GAAP measure, was $1.05 for the third quarter of 2025, compared to $0.80 for the third quarter of 2024 and $0.88 for the second quarter of 2025.

The Company completed the acquisition of Evans Bancorp, Inc. (“Evans”) on May 2, 2025, adding 200 employees and 18 banking locations in Western New York, $1.67 billion in loans and $1.86 billion in deposits.

In connection with the transaction, the Company issued 5.1 million shares of common stock, with a value of $221.8 million as of the closing date. The comparisons to the second quarter of 2025 and to the third quarter of 2024 are significantly impacted by the Evans acquisition.

“For the third quarter of 2025, we achieved record net income and earnings per share, and we reported a return on average assets of 1.35% and a return on average tangible common equity of 17.35%,” said NBT President and CEO Scott Kingsley. “These results reflect productive growth in earning assets, deposits, and our sixth consecutive quarter of net interest margin improvement, including a full quarter of our merger with Evans Bancorp, Inc. completed in May. Having increased our dividend for the thirteenth consecutive year, we approved a quarterly cash dividend for our shareholders of $0.37 per share, representing an increase of 8.8% over the prior year and illustrative of our ongoing commitment to providing favorable long-term returns.”

Third Quarter 2025 Financial Highlights

Net Income:

- Net income was $54.5 million and diluted earnings per share was $1.03

- Operating net income was $55.3 million and operating diluted earnings per share was $1.05(1).

Net Interest Income / NIM:

- Net interest income on a fully taxable equivalent (“FTE”) basis was $135.3 million, an increase of $10.4 million from the prior quarter(1).

- Net interest margin (“NIM”) on an FTE basis was 3.66%(1), an increase of 7 basis points (“bps”) from the prior quarter.

- Earning asset yields of 5.18% were up 6 bps from the prior quarter.

- Total cost of funds of 1.60% was down 2 bps from the prior quarter.

Included in FTE net interest income was $6.3 million of acquisition-related net accretion, which was up $1.3 million from the second quarter of 2025.

Noninterest Income:

Noninterest income was $51.4 million, or 28% of total revenues, excluding net securities (losses) gains

Loans and Credit Quality:

- Period end total loans were $11.60 billion as of September 30, 2025, including $1.67 billion of loans acquired from Evans.

- Net charge-offs to average loans was 0.15% annualized.

- Nonperforming loans to total loans was 0.46%.

- Allowance for loan losses to total loans was 1.20% .

Provision for loan losses was $3.1 million.

Deposits:

- Deposits were $13.66 billion as of September 30, 2025, including $1.86 billion in deposits acquired from Evans.

- Total cost of deposits was 1.52% for the third quarter of 2025, up 1 bp from the second quarter of 2025.

Capital:

- Stockholders’ equity was $1.85 billion as of September 30, 2025.

- Tangible book value per share(2) was $25.51 at September 30, 2025.

- Tangible equity to assets of 8.58%(1).

- CET1 ratio of 11.80%; Leverage ratio of 9.34%.

Loans:

Period end total loans were $11.60 billion at September 30, 2025, compared to $9.97 billion at December 31, 2024 and $9.91 billion at September 30, 2024.

Period end total loans increased $1.63 billion from December 31, 2024 and $1.69 billion from September 30, 2024. Excluding the other consumer and residential solar portfolios, which are in a planned run-off status, and the loans acquired from Evans, period end loans increased $132.4 million, or 1.5%, from September 30, 2024.

Deposits

Total deposits at September 30, 2025 were $13.66 billion, compared to $11.55 billion at December 31, 2024 and $11.59 billion at September 30, 2024. Excluding the deposits acquired from Evans, deposits increased $250.1 million from December 31, 2024 and $208.6 million from September 30, 2024. Excluding deposits acquired from Evans, demand, interest-bearing checking and money market accounts increased, partially offset by a decrease in time deposits.

The loan to deposit ratio was 84.9% at September 30, 2025, compared to 86.3% at December 31, 2024 and 85.5% at September 30, 2024.

Net Interest Income and Net Interest Margin

Net interest income for the third quarter of 2025 was $134.7 million, an increase of $10.4 million, or 8.4%, from the second quarter of 2025 and an increase of $33.0 million, or 32.5%, from the third quarter of 2024. The increase in net interest income from the second quarter of 2025 was largely attributed to the full quarter impact of the Evans acquisition with higher earning asset yields also contributing to the increase. The increase in net interest income from the third quarter of 2024 resulted primarily from the Evans acquisition, the improvement in net interest margin and organic growth in interest-earning assets.

The NIM on an FTE basis for the third quarter of 2025 was 3.66%, an increase of 7 bps from the second quarter of 2025. This increase was primarily driven by an increase in earning asset yields and acquisition-related net accretion. The NIM on an FTE basis increased 39 bps from the third quarter of 2024 due to higher yields on earning assets, including acquisition-related net accretion and a decrease in the cost of borrowings.

Earning asset yields for the three months ended September 30, 2025 increased 6 bps from the prior quarter to 5.18%. Loan yields for the three months ended September 30, 2025 increased 3 bps from the prior quarter to 5.80% due to loans originating at higher rates than portfolio yields during the quarter and acquisition-related net accretion. Earning asset yields increased 17 bps from the same quarter in the prior year due to new loan yields that were priced higher than portfolio yields and acquisition-related net accretion. Average earning assets increased $685.1 million, or 4.9%, from the second quarter of 2025 and grew $2.20 billion, or 17.6%, from the third quarter of 2024 due primarily to the addition of $1.95 billion in interest-earning assets acquired from Evans and organic earning asset growth.

Total cost of deposits, including noninterest bearing deposits, was 1.52% for the third quarter of 2025, an increase of 1 bp from the prior quarter as a full quarter of Evans higher cost of deposits, primarily in interest-bearing checking and savings deposit accounts, were partially offset by a decrease in the cost of time deposits. Total cost of deposits decreased 16 bps from the same period in the prior year.

Total cost of funds for the three months ended September 30, 2025 was 1.60%, a decrease of 2 bps from the prior quarter and a decrease of 25 bps from the third quarter of 2024.

In July of 2025, the Company redeemed $118 million of subordinated debt that had a weighted average rate of 5.45% using existing liquidity sources. The $118 million of subordinated debt would have converted to a weighted average floating rate in excess of 9%.

Asset Quality and Allowance for Loan Losses

Net charge-offs to total average loans for the third quarter of 2025 was 15 bps compared to 9 bps in the prior quarter primarily due to an increase in both commercial and consumer net charge-offs.

Nonperforming assets to total assets was 0.33% at September 30, 2025, compared to 0.29% at June 30, 2025 and compared to 0.38% at December 31, 2024.

Provision expense for the three months ended September 30, 2025 was $3.1 million, compared to $17.8 million for the second quarter of 2025. The decrease in the provision for loan losses during the quarter was due to the $13.0 million of acquisition-related provision for loan losses recognized in the second quarter of 2025.

The allowance for loan losses was $139.0 million, or 1.20% of total loans, at September 30, 2025, compared to $140.2 million, or 1.21% of total loans, at June 30, 2025 and compared to $116.0 million, or 1.16% of total loans, at December 31, 2024. The decrease in the allowance for loan losses in the third quarter of 2025 was driven by portfolio mix changes resulting from the run-off of the other consumer and residential solar portfolios which were partially offset by a modest deterioration of the economic forecast. The increase in the allowance for loan losses from the fourth quarter of 2024 was due to the $20.7 million of allowance for acquired Evans loans.

The reserve for unfunded loan commitments was $5.9 million at September 30, 2025, compared to $6.2 million at June 30, 2025 and compared to $4.4 million at December 31, 2024. The provision for unfunded loan commitments in the second quarter of 2025 included $0.5 million of acquisition-related provision for unfunded loan commitments.

Noninterest Income

Total noninterest income, excluding securities (losses) gains, was $51.4 million for the three months ended September 30, 2025, up $4.6 million, or 9.8%, from the second quarter of 2025, and up $6.1 million, or 13.5%, from the third quarter of 2024. The seasonally higher third quarter also benefited from the full quarter impact of the Evans acquisition.

Service charges on deposit accounts were higher than the prior quarter and the third quarter of 2024 due primarily to the Evans acquisition and new account growth.

Card services income increased $0.3 million from the prior quarter and increased $0.5 million from the third quarter of 2024 driven by the Evans acquisition and increased volumes.

Retirement plan administration fees were consistent with the prior quarter and increased $1.3 million, or 9.2%, from the third quarter of 2024. The increase from the third quarter of 2024 was driven by higher market values of assets under administration and the acquisition of a small third-party administrator business in the fourth quarter of 2024.

Wealth management fees increased $0.4 million, or 4.0%, from the prior quarter and were consistent with the third quarter of 2024. The increase from the prior quarter was driven by market performance, growth in new customer accounts and seasonal activity-based fees.

Insurance revenues increased $1.2 million from the prior quarter driven by seasonal renewals and increased $0.3 million, or 7.1%, from the prior year due to organic growth.

Bank owned life insurance income increased from the second quarter of 2025 and the third quarter of 2024 due to a $0.9 million gain recognized in the third quarter of 2025.

Other noninterest income increased $0.9 million from the prior quarter and $1.6 million from the third quarter of 2024 driven by a $0.6 million gain related to the finalization of a third-party contractual arrangement. In addition, the increase from the third quarter of 2024 was driven by an increase in loan servicing income and loan related fee income.

Noninterest Expense

Total noninterest expense was $111.1 million for the third quarter of 2025, compared to $122.6 million for the second quarter of 2025 and $95.7 million for the third quarter of 2024. Total noninterest expense, excluding $1.1 million of acquisition expenses in the third quarter of 2025, $17.2 million of acquisition expenses in the second quarter of 2025 and $0.5 million of acquisition expenses in the third quarter of 2024, increased 4.4% compared to the previous quarter and increased 15.6% from the third quarter of 2024. The increase was primarily due to the Evans acquisition.

Salaries and benefits increased 3.9% from the prior quarter driven by the full quarter impact of the Evans acquisition as NBT added 200 Evans employees in May, higher incentive compensation expenses and higher medical costs. The increase from the third quarter of 2024 was driven by the impact of the Evans acquisition, merit pay increases, higher medical expenses and higher incentive compensation expenses.

Technology and data services increased $0.4 million from the prior quarter and $1.3 million from the third quarter of 2024 primarily due to the Evans acquisition, timing of planned activities and ongoing investment in enterprise technology initiatives.

Occupancy costs were consistent from the prior quarter due to lower seasonal maintenance and utilities costs being offset by the additional expenses from the Evans acquisition. The $1.3 million increase from the third quarter of 2024 was driven by the additional expenses from the Evans acquisition, higher utilities and higher facilities costs related to new banking locations.

Professional fees and outside services increased $0.9 million from the prior quarter and $1.1 million from the third quarter of 2024 primarily due to the Evans acquisition and the timing of various initiatives.

Amortization of intangible assets increased $0.4 million from the prior quarter and $1.4 million from the third quarter of 2024 primarily due to the amortization of intangible assets related to the Evans acquisition.

Other expense increased $2.4 million from the prior quarter and $3.4 million from the third quarter of 2024. The increase from the previous quarter was driven by the Evans acquisition including increased FDIC insurance expense, travel, training and charitable contributions.

Income Taxes

The effective tax rate for the third quarter of 2025 was 24.2%, which was up from 21.9% for the third quarter of 2024 primarily due to the estimated impact of nondeductible acquisition expenses related to the Evans acquisition and a lower level of tax-exempt income as a percentage of total pretax income.

Capital

Tangible common equity to tangible assets(1) was 8.58% at September 30, 2025. Tangible book value per share(2) was $25.51 at September 30, 2025, $24.57 at June 30, 2025 and $23.83 at September 30, 2024.

Stockholders’ equity increased $327.0 million from December 31, 2024 driven by the Evans acquisition adding $221.8 million of capital, net income generation of $113.7 million and a $41.8 million decrease in accumulated other comprehensive loss reflecting the change in the fair value of securities available for sale, partially offset by dividends declared of $53.3 million.

As of September 30, 2025, CET1 capital ratio of 11.80%, leverage ratio of 9.34% and total risk-based capital ratio of 13.97%.

Dividend

The Board of Directors approved a fourth-quarter cash dividend of $0.37 per share at a meeting held earlier today. The dividend represents a $0.03 per quarter, or 8.8%, increase over the dividend paid in the fourth quarter of 2024. This is the Company’s thirteenth consecutive year of annual dividend increases. The dividend will be paid on December 15, 2025 to stockholders of record as of December 1, 2025.

Stock Repurchase

The Company did not purchase shares of its common stock during the three months ended September 30, 2025.

On October 27, 2025, the Board of Directors authorized and approved an amendment to the Company’s previously announced stock repurchase program. Pursuant to the amended stock repurchase program, the Company may repurchase up to 2,000,000 shares of the Company’s common stock with all repurchases under the stock repurchase program to be made by December 31, 2027. The Company may repurchase shares of its common stock from time to time to mitigate the potential dilutive effects of stock-based incentive plans and other potential uses of common stock for corporate purposes.

NBT Bancorp Inc. is a financial holding company headquartered in Norwich, NY, with total assets of $16.11 billion at September 30, 2025. The Company primarily operates through NBT Bank, N.A., a full-service community bank, and through two financial services companies. NBT Bank, N.A. has 175 banking locations in New York, Pennsylvania, Vermont, Massachusetts, New Hampshire, Maine and Connecticut. EPIC Retirement Plan Services, based in Rochester, NY, is a national benefits administration firm.

NBT Insurance Agency, LLC, based in Norwich, NY, is a full-service insurance agency. More information about NBT and its divisions is available online at: www.nbtbancorp.com, www.nbtbank.com, www.epicrps.com and www.nbtbank.com/Insurance.

- Information from NBT Bancorp Inc.