COMMUNITY BANK SYSTEM, INC. | ||
(Exact name of registrant as specified in its charter) |
Delaware | 001-13695 | 16-1213679 |
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
5790 Widewaters Parkway, DeWitt, New York | 13214-1883 | |
(Address of principal executive offices) | (Zip Code) |
Check the appropriate box below if the form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions: | ||
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Date: October 25, 2011 | /s/ Mark Tryniski |
Mark E. Tryniski, President, Chief Executive Officer and Director | |
Date: October 25, 2011 | /s/ Scott Kingsley |
Scott Kingsley, Executive Vice President and Chief Financial Officer |
News Release | |
COMMUNITY BANK SYSTEM, INC.
|
|
5790 Widewaters Parkway, DeWitt, N.Y. 13214 | For further information, please contact: |
Summary of Financial Data
|
||||
(Dollars in thousands, except per share data)
|
||||
Quarter Ended
|
Year-to-date
|
|||
September 30, 2011
|
September 30, 2010
|
September 30, 2011
|
September 30, 2010
|
|
Earnings
|
||||
Loan income
|
$50,702
|
$45,094
|
$142,470
|
$134,618
|
Investment income
|
19,716
|
17,503
|
58,085
|
51,654
|
Total interest income
|
70,418
|
62,597
|
200,555
|
186,272
|
Interest expense
|
15,850
|
16,273
|
46,277
|
50,721
|
Net interest income
|
54,568
|
46,324
|
154,278
|
135,551
|
Provision for loan losses
|
1,043
|
1,400
|
3,143
|
5,270
|
Net interest income after provision for loan losses
|
53,525
|
44,924
|
151,135
|
130,281
|
Deposit service fees
|
11,134
|
11,180
|
31,307
|
33,036
|
Mortgage banking revenues
|
320
|
1,215
|
1,698
|
2,290
|
Other banking services
|
1,179
|
863
|
2,222
|
1,826
|
Trust, investment and asset management fees
|
2,904
|
2,400
|
7,866
|
7,442
|
Benefit plan administration, consulting and actuarial fees
|
7,685
|
7,256
|
23,722
|
22,415
|
Investment securities and debt extinguishment gain/(loss), net
|
(6)
|
0
|
8
|
0
|
Total noninterest income
|
23,216
|
22,914
|
66,823
|
67,009
|
Salaries and employee benefits
|
26,543
|
23,056
|
75,185
|
68,501
|
Occupancy and equipment and furniture
|
6,103
|
5,574
|
18,413
|
17,414
|
Amortization of intangible assets
|
1,161
|
1,277
|
3,251
|
4,985
|
Acquisition expenses & special charges
|
381
|
57
|
4,689
|
256
|
Other
|
13,905
|
14,388
|
40,997
|
41,609
|
Total operating expenses
|
48,093
|
44,352
|
142,535
|
132,765
|
Income before income taxes
|
28,648
|
23,486
|
75,423
|
64,525
|
Income taxes
|
8,640
|
6,224
|
21,269
|
17,099
|
Net income
|
$20,008
|
$17,262
|
$54,154
|
$47,426
|
Basic earnings per share
|
$0.54
|
$0.52
|
$1.52
|
$1.43
|
Diluted earnings per share
|
$0.54
|
$0.51
|
$1.50
|
$1.42
|
Summary of Financial Data
|
|||||
(Dollars in thousands, except per share data)
|
|||||
2011
|
2010
|
||||
3rd Qtr
|
2nd Qtr
|
1st Qtr
|
4th Qtr
|
3rd Qtr
|
|
Earnings
|
|||||
Loan income
|
$50,702
|
$49,471
|
$42,297
|
$44,085
|
$45,094
|
Investment income
|
19,716
|
20,379
|
17,990
|
17,924
|
17,503
|
Total interest income
|
70,418
|
69,850
|
60,287
|
62,009
|
62,597
|
Interest expense
|
15,850
|
15,663
|
14,764
|
15,876
|
16,273
|
Net interest income
|
54,568
|
54,187
|
45,523
|
46,133
|
46,324
|
Provision for loan losses
|
1,043
|
1,050
|
1,050
|
1,935
|
1,400
|
Net interest income after provision for loan losses
|
53,525
|
53,137
|
44,473
|
44,198
|
44,924
|
Deposit service fees
|
11,134
|
10,488
|
9,685
|
10,321
|
11,180
|
Mortgage banking revenues
|
320
|
982
|
396
|
1,408
|
1,215
|
Other banking services
|
1,179
|
645
|
398
|
462
|
863
|
Trust, investment and asset management fees
|
2,904
|
2,782
|
2,180
|
2,391
|
2,400
|
Benefit plan administration, consulting and actuarial fees
|
7,685
|
7,854
|
8,183
|
7,201
|
7,256
|
Investment securities and debt extinguishment gain/(loss), net
|
(6)
|
14
|
0
|
0
|
0
|
Total noninterest income
|
23,216
|
22,765
|
20,842
|
21,783
|
22,914
|
Salaries and employee benefits
|
26,543
|
25,531
|
23,111
|
22,900
|
23,056
|
Occupancy and equipment and furniture
|
6,103
|
6,253
|
6,057
|
5,520
|
5,574
|
Amortization of intangible assets
|
1,161
|
1,189
|
901
|
972
|
1,277
|
Acquisition expenses & special charges
|
381
|
3,617
|
691
|
1,107
|
57
|
Other
|
13,905
|
14,536
|
12,556
|
13,622
|
14,388
|
Total operating expenses
|
48,093
|
51,126
|
43,316
|
44,121
|
44,352
|
Income before income taxes
|
28,648
|
24,776
|
21,999
|
21,860
|
23,486
|
Income taxes
|
8,640
|
6,790
|
5,839
|
5,966
|
6,224
|
Net income
|
$20,008
|
$17,986
|
$16,160
|
$15,894
|
$17,262
|
Basic earnings per share
|
$0.54
|
$0.49
|
$0.48
|
$0.48
|
$0.52
|
Diluted earnings per share
|
$0.54
|
$0.49
|
$0.48
|
$0.47
|
$0.51
|
Profitability
|
|||||
Return on assets
|
1.23%
|
1.14%
|
1.19%
|
1.15%
|
1.25%
|
Return on equity
|
10.67%
|
10.15%
|
10.70%
|
10.27%
|
11.28%
|
Noninterest income/operating income (FTE) (1)
|
28.5%
|
28.1%
|
29.6%
|
30.3%
|
31.4%
|
Efficiency ratio (2)
|
57.0%
|
57.2%
|
59.3%
|
57.9%
|
57.9%
|
Components of Net Interest Margin (FTE)
|
|||||
Loan yield
|
5.81%
|
5.77%
|
5.73%
|
5.73%
|
5.81%
|
Cash equivalents yield
|
0.25%
|
0.24%
|
0.25%
|
0.25%
|
0.27%
|
Investment yield
|
4.55%
|
4.75%
|
5.01%
|
5.00%
|
4.84%
|
Earning asset yield
|
5.13%
|
5.24%
|
5.30%
|
5.36%
|
5.41%
|
Interest-bearing deposit rate
|
0.70%
|
0.70%
|
0.75%
|
0.86%
|
0.90%
|
Borrowing rate
|
4.27%
|
4.24%
|
4.28%
|
4.28%
|
4.28%
|
Cost of all interest-bearing funds
|
1.32%
|
1.34%
|
1.47%
|
1.56%
|
1.59%
|
Cost of funds (includes DDA)
|
1.12%
|
1.14%
|
1.25%
|
1.32%
|
1.35%
|
Net interest margin (FTE)
|
4.04%
|
4.13%
|
4.08%
|
4.07%
|
4.08%
|
Fully tax-equivalent adjustment
|
$3,836
|
$4,018
|
$3,969
|
$3,865
|
$3,788
|
Summary of Financial Data
|
||||||
(Dollars in thousands, except per share data)
|
||||||
2011
|
2010
|
|||||
3rd Qtr
|
2nd Qtr
|
1st Qtr
|
4th Qtr
|
3rd Qtr
|
||
Average Balances
|
||||||
Loans
|
$3,481,087
|
$3,454,246
|
$3,005,926
|
$3,061,060
|
$3,088,590
|
|
Cash equivalents
|
240,127
|
177,154
|
159,044
|
105,242
|
50,484
|
|
Taxable investment securities
|
1,458,127
|
1,447,815
|
1,188,182
|
1,159,110
|
1,182,243
|
|
Nontaxable investment securities
|
560,051
|
579,795
|
565,564
|
554,014
|
550,660
|
|
Total interest-earning assets
|
5,739,392
|
5,659,010
|
4,918,716
|
4,879,426
|
4,871,977
|
|
Total assets
|
6,447,210
|
6,313,391
|
5,487,618
|
5,481,129
|
5,474,952
|
|
Interest-bearing deposits
|
3,926,457
|
3,864,671
|
3,234,986
|
3,206,327
|
3,217,831
|
|
Borrowings
|
832,505
|
839,003
|
830,454
|
831,025
|
832,568
|
|
Total interest-bearing liabilities
|
4,758,962
|
4,703,674
|
4,065,440
|
4,037,352
|
4,050,399
|
|
Noninterest-bearing deposits
|
867,373
|
813,789
|
739,515
|
743,698
|
736,203
|
|
Shareholders' equity
|
$743,730
|
$710,765
|
$612,559
|
$613,734
|
$606,912
|
|
Balance Sheet Data
|
||||||
Cash and cash equivalents
|
$425,877
|
$273,693
|
$296,938
|
$211,837
|
$179,556
|
|
Investment securities
|
2,075,283
|
2,088,105
|
1,792,246
|
1,742,324
|
1,769,149
|
|
Loans:
|
||||||
Business lending
|
1,261,125
|
1,290,893
|
1,006,114
|
1,023,286
|
1,045,849
|
|
Consumer mortgage
|
1,167,780
|
1,149,219
|
1,055,164
|
1,057,332
|
1,065,297
|
|
Consumer installment - indirect
|
564,423
|
549,449
|
500,058
|
494,813
|
508,502
|
|
Home equity
|
328,468
|
330,213
|
299,925
|
305,936
|
312,396
|
|
Consumer installment - direct
|
154,673
|
158,376
|
139,183
|
144,996
|
148,353
|
|
Total loans
|
3,476,469
|
3,478,150
|
3,000,444
|
3,026,363
|
3,080,397
|
|
Allowance for loan losses
|
42,463
|
42,531
|
42,147
|
42,510
|
42,610
|
|
Intangible assets
|
360,228
|
363,015
|
311,076
|
311,714
|
312,686
|
|
Other assets
|
208,460
|
230,053
|
190,815
|
194,778
|
197,039
|
|
Total assets
|
6,503,854
|
6,390,485
|
5,549,372
|
5,444,506
|
5,496,217
|
|
Deposits:
|
||||||
Noninterest-bearing
|
887,009
|
849,071
|
754,892
|
741,166
|
738,994
|
|
Non-maturity interest-bearing
|
2,782,241
|
2,721,589
|
2,361,312
|
2,272,013
|
2,253,447
|
|
Time
|
1,169,503
|
1,186,442
|
904,827
|
920,866
|
973,894
|
|
Total deposits
|
4,838,753
|
4,757,102
|
4,021,031
|
3,934,045
|
3,966,335
|
|
Borrowings
|
728,335
|
728,441
|
728,385
|
728,460
|
729,508
|
|
Subordinated debt held by unconsolidated subsidiary trusts
|
102,042
|
102,036
|
102,030
|
102,024
|
102,018
|
|
Other liabilities
|
79,091
|
72,835
|
73,826
|
72,719
|
82,556
|
|
Total liabilities
|
5,748,221
|
5,660,414
|
4,925,272
|
4,837,248
|
4,880,417
|
|
Shareholders' equity
|
755,633
|
730,071
|
624,100
|
607,258
|
615,800
|
|
Total liabilities and shareholders' equity
|
6,503,854
|
6,390,485
|
5,549,372
|
5,444,506
|
5,496,217
|
|
Capital
|
||||||
Tier 1 leverage ratio
|
8.17%
|
8.07%
|
8.42%
|
8.23%
|
7.99%
|
|
Tangible equity / net tangible assets (3)
|
6.79%
|
6.44%
|
6.36%
|
6.14%
|
6.21%
|
|
Diluted weighted average common shares O/S
|
37,312
|
37,061
|
33,989
|
33,786
|
33,606
|
|
Period end common shares outstanding
|
36,829
|
36,807
|
33,429
|
33,319
|
33,162
|
|
Cash dividends declared per common share
|
$0.26
|
$0.24
|
$0.24
|
$0.24
|
$0.24
|
|
Book value
|
$20.52
|
$19.84
|
$18.67
|
$18.23
|
$18.57
|
|
Tangible book value(3)
|
$11.37
|
$10.59
|
$10.01
|
$9.49
|
$9.74
|
|
Common stock price (end of period)
|
$22.69
|
$24.79
|
$24.27
|
$27.77
|
$23.01
|
Summary of Financial Data
|
|||||
(Dollars in thousands, except per share data)
|
2011
|
2010
|
||||
3rd Qtr
|
2nd Qtr
|
1st Qtr
|
4th Qtr
|
3rd Qtr
|
|
Asset Quality
|
|||||
Nonaccrual loans
|
$16,670
|
$17,833
|
$14,953
|
$15,378
|
$16,025
|
Accruing loans 90+ days delinquent
|
2,319
|
2,499
|
2,774
|
3,091
|
1,863
|
Total nonperforming loans
|
18,989
|
20,332
|
17,727
|
18,469
|
17,888
|
Other real estate owned (OREO)
|
2,776
|
3,269
|
1,945
|
2,011
|
2,689
|
Total nonperforming assets
|
21,765
|
23,601
|
19,672
|
20,480
|
20,577
|
Net charge-offs
|
1,111
|
666
|
1,413
|
2,035
|
1,393
|
Loan loss allowance/loans outstanding
|
1.22%
|
1.22%
|
1.40%
|
1.40%
|
1.38%
|
Nonperforming loans/loans outstanding
|
0.54%
|
0.58%
|
0.59%
|
0.61%
|
0.58%
|
Loan loss allowance/nonperforming loans
|
226%
|
209%
|
238%
|
230%
|
238%
|
Net charge-offs/average loans
|
0.13%
|
0.08%
|
0.19%
|
0.26%
|
0.18%
|
Delinquent loans/ending loans
|
1.56%
|
1.50%
|
1.46%
|
1.91%
|
1.64%
|
Loan loss provision/net charge-offs
|
94%
|
158%
|
74%
|
95%
|
100%
|
Nonperforming assets/total assets
|
0.33%
|
0.37%
|
0.35%
|
0.38%
|
0.37%
|
(1) Excludes gain (loss) on investment securities and amortization/accretion of fair market value purchase accounting adjustments.
|
||||||
(2) Excludes intangible amortization, goodwill impairment, acquisition expenses, special charges, gain (loss) on investment securities, and amortization/accretion of fair market value purchase accounting adjustments.
|
||||||
(3) Includes deferred tax liabilities (of approximately $23.5 million at 9/30/11) related to tax deductible goodwill.
|
||||||