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Community Bank System Reports
First Quarter 2019 Results
SYRACUSE, N.Y. — April 22, 2019 — Community Bank System, Inc. (NYSE: CBU) reported first quarter 2019 net income of $41.9 million, or $0.80 per fully diluted share. This compares to $40.1 million of net income, or $0.78 per share reported for the first quarter of 2018. The $0.02 increase in earnings per share was attributable to an increase in net interest income and decreases in the provision for loan losses and income taxes, offset in part by a decrease in bank noninterest revenues, higher operating expenses and an increase in fully-diluted shares outstanding. Comparatively, the Company recorded $0.78 in fully diluted earnings per share for the linked fourth quarter of 2018. Operating earnings per share, which excludes acquisition expenses and unrealized gain on equity securities, were $0.81 for the first quarter of 2019, a $0.03 improvement over the first quarter 2018 operating earnings per share.
First Quarter 2019 Performance Highlights:
|v||First quarter GAAP EPS of $0.80; up $0.02 over first quarter of 2018|
|v||First quarter Operating EPS of $0.81; up $0.03 over the first quarter of 2018|
|v||Net interest margin of 3.80% increased 9 basis points over first quarter of 2018|
|v||Deposit funding costs of 0.20%|
|v||Return on assets of 1.59%|
|v||Return on tangible equity of 17.61%|
|v||Noninterest revenues represent 39.1% of operating revenues|
|v||Announced the acquisition of Kinderhook Bank Corp.|
“Our improved first quarter 2019 operating results were driven by a combination of net interest income growth, increased financial services revenue and a continuation of excellent credit quality metrics, “said Mark E. Tryniski, President and Chief Executive Officer. “The strong performance of our core banking business worked to offset a $0.05 reduction in earnings per share related to the Durbin debit interchange price restrictions which became effective for the Company in the third quarter of 2018. Net interest income was up $2.2 million over the first quarter of 2018 and the net interest margin increased nine basis points to 3.80%, reflecting an increase in total loans and the favorable effect of certain loan pre-payment fees, which added four basis points to the net interest margin. Total deposits increased $297.3 million, or 3.6%, in the quarter primarily from significant increases to transaction and savings accounts. In January, we announced a definitive agreement to acquire Kinderhook Bank Corp., parent company of National Union Bank of Kinderhook. This transaction will extend our banking footprint into the attractive Capital District markets which are similar to the other Upstate New York markets in which we are a strong competitor. This investment also complements the financial commitment we made in 2018 when we added an experienced commercial banking team focused on the greater Albany area. We’re pleased with a first quarter performance that’s reflective of consistent and effective execution of our ongoing business strategy.”
Total revenues for the first quarter of 2019 were $142.6 million, an increase of $0.4 million, or 0.3%, over the prior year quarter. Net interest income increased $2.2 million, or 2.6%, to $86.9 million due to an improvement in the net interest margin, while noninterest revenues decreased $1.8 million, or 3.1%, between comparable quarters. A $3.0 million decrease in banking noninterest revenues, due primarily to the impact of Durbin-related debit interchange price restrictions, and a $0.3 million decrease in wealth management services revenues was offset, in part, by a $1.0 million, or 4.6% increase in employee benefit services revenues and a $0.5 million, or 6.8%, increase in the insurance services revenues. Noninterest revenues of $55.7 million comprised 39.1% of the Company’s total revenues during the first quarter of 2019, similar to 2018 full year results.
The following information was filed by Community Bank System, Inc. (CBU) on Monday, April 22, 2019 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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