ex99_1.htm

NORWICH, NY (January 26, 2009) – NBT Bancorp Inc. (NBT) (NASDAQ: NBTB) reported today that net income for the year ended December 31, 2008 was $58.4 million, up $8.1 million, or 15.9%, from net income of $50.3 million reported in 2007. Net income per diluted share for the year ended December 31, 2008 was $1.80 per share, compared with $1.51 per share for 2007. Return on average assets and return on average equity were 1.11% and 14.16%, respectively, for the year ended December 31, 2008, compared with 0.98% and 12.60%, respectively, for 2007.

Net income for the three months ended December 31, 2008 was $14.9 million, up $5.9 million, or 65.8%, from net income of $9.0 million reported for the same period in 2007. Net income per diluted share for the three months ended December 31, 2008 was $0.45 per share, compared with $0.28 per share for the same period in 2007. Return on average assets and return on average equity were 1.11% and 13.88%, respectively, for the three months ended December 31, 2008, compared with 0.69% and 9.06%, respectively, for the same period in 2007.

NBT President and CEO Martin Dietrich said: “Although 2008 presented many challenges for the financial services industry and the economy in general, I am extremely pleased with the record earnings we achieved in this difficult environment. While the current financial crisis has caused many banks to struggle, we were able to post record diluted earnings per share of $1.80 and record net income of $58.4 million. In addition, the return on our stock, including reinvested dividends, was up over 26% as of December 31, 2008, compared with December 31, 2007. Our strong 2008 performance can be attributed to many factors, including growth in net interest income resulting from strategic management of our earning assets and interest bearing liabilities. Our net interest margin was 3.95% in 2008, compared with 3.61% for 2007. In addition, our efforts to grow our noninterest income resulted in a 20.1% increase over 2007. We have also seen several asset quality indicators improve from 2007. Our nonperforming assets were down approximately 12.8% from 2007, and net charge-offs were down approximately 14.0% from last year. During 2008, we continued our controlled growth initiative by opening three new branches within our footprint. While 2009 may be a very challenging year given the economic environment, I am confident in our ability to successfully navigate through the challenges ahead and deliver long-term value to our shareholders and customers.”

Nonperforming loans at December 31, 2008 were $26.5 million or 0.73% of total loans and leases compared with $30.6 million or 0.88% at December 31, 2007. The decrease in nonperforming loans at December 31, 2008 from December 31, 2007 was primarily the result of net charge-offs during the 12 month period ending December 31, 2008 related to two large commercial loans, both of which had been previously identified and reserved for in 2007. The allowance for loan and lease losses totaled $58.6 million at December 31, 2008, compared with $54.2 million at December 31, 2007.

The Company recorded a provision for loan and lease losses of $27.2 million for the year ended December 31, 2008, compared with $30.1 million for the 12 months ended December 31, 2007. Net charge-offs totaled $22.8 million for the 12 months ended December 31, 2008, down from $26.5 million for the same period a year ago. The decrease in net charge-offs for the 12 months ended December 31, 2008 was due primarily to charge-offs in 2007 related to one large commercial real estate loan. Net charge-offs to average loans and leases for the 12 months ended December 31, 2008 were 0.64%, compared with 0.77% for the 12 months ended December 31, 2007.

The Company recorded a provision for loan and lease losses of $7.7 million during the fourth quarter of 2008 compared with $13.4 million for the three months ending December 31, 2007. The decrease in the provision for loan and lease losses for the three months ended December 31, 2008, compared with the three months ended December 31, 2007, was due primarily to the provision in the fourth quarter of 2007 related to one large commercial non-real estate loan. Net charge-offs totaled $5.0 million for the three month period ending December 31, 2008, down from $14.1 million for the three months ended December 31, 2007. The decrease in net charge-offs for the three months ended December 31, 2008, compared with the three months ended December 31, 2007, was due primarily to charge-offs in the fourth quarter of 2007 related to the aforementioned commercial real estate loan. Annualized net charge-offs to average loans and leases for the three months ended December 31, 2008 were 0.54%, compared with 1.62% for the three months ended December 31, 2007. The Company’s allowance for loan and lease losses was 1.60% of loans and leases at December 31, 2008, compared with 1.57% at December 31, 2007.

Net interest income was up 12.7% to $186.0 million for the year ended December 31, 2008, compared with $165.0 million for the year ended December 31, 2007. The Company’s fully taxable equivalent (FTE) net interest margin increased from 3.61% for the year ended December 31, 2007 to 3.95% for the year ended December 31, 2008. In addition, the Company experienced a 2.8% growth in average earning assets for the year ended December 31, 2008, compared with the year ended December 31, 2007, due primarily to an increase in average loans and leases. Although the yield on interest earning assets decreased 41 basis points, the yield on interest bearing liabilities declined 88 basis points, which contributed to the increase in the net interest margin from the 12 months ended December 31, 2007. The yield on money market deposit accounts declined from 3.38% for the 12 months ended December 31, 2007 to 1.85% for the 12 months ended December 31, 2008, while the yield on time deposits decreased 86 basis points for the same period. The yield on short term borrowings declined 245 basis points for the 12 months ended December 31, 2008, compared with the 12 months ended December 31, 2007, as a result of the 400 basis point drop in the Federal Reserve’s target for the federal funds rate from 4.25% at December 31, 2007 to 0.25% at December 31, 2008.

Net interest income was up 16.9% to $48.9 million for the three months ended December 31, 2008 compared with $41.9 million for the three months ended December 31, 2007. The Company’s FTE net interest margin increased from 3.61% for the three months ended December 31, 2007 to 4.06% for the three months ended December 31, 2008. In addition, the Company experienced a 3.7% growth in average earning assets for the three months ending December 31, 2008, compared with the three months ending December 31, 2007, due primarily to an increase in average loans and leases. Although the yield on interest earning assets decreased 51 basis points, the yield on interest bearing liabilities declined 113 basis points, which contributed to the increase in the net interest margin for the three months ended December 31, 2008, compared with the same period for 2007. The yield on money market deposit accounts declined from 3.24% for the three months ended December 31, 2007 to 1.61% for the three months ended December 31, 2008, while the yield on time deposits decreased 124 basis points for the same period. The yield on short term borrowings declined 344 basis points for the three months ended December 31, 2008, compared with the three months ended December 31, 2007, as a result of the aforementioned 400 basis point drop in the Federal Reserve’s target for the federal funds rate.

Noninterest income for the year ended December 31, 2008 was $71.7 million, up $12.0 million or 20.1% from $59.7 million for the same period in 2007. The increase in noninterest income was due primarily to an increase in service charges on deposit accounts and ATM and debit card fees, which collectively increased $6.0 million due to various initiatives in 2008. In addition, trust administration income increased $0.8 million for the year ended December 31, 2008, compared with the same period in 2007. This increase stems primarily from an increase in customer accounts resulting from successful business development. Broker/dealer and insurance revenue increased approximately $4.5 million for the year ended December 31, 2008, primarily due to the acquisition of Mang Insurance Agency, LLC during the third quarter of 2008. Other noninterest income increased $0.7 million for the year ended December 31, 2008, compared with the same period in 2007. This increase was due primarily to a death benefit realized during the fourth quarter of 2008 from a life insurance policy. Net securities gains for the 12 month period ending December 31, 2008 were $1.5 million, compared with $2.1 million for the 12 month period ending December 31, 2007. Excluding the effects of these securities transactions, noninterest income increased $12.6 million, or 21.9%, for the 12 months ended December 31, 2008, compared with 2007.

Noninterest income for the three months ended December 31, 2008 was $20.2 million, up $3.7 million or 22.7% from $16.5 million for the same period in 2007. The increase in noninterest income was due primarily to an increase in broker/dealer and insurance revenue of approximately $2.9 million for the three month period ended December 31, 2008, due primarily to revenue generated by the aforementioned acquisition of Mang Insurance Agency, LLC. Other noninterest income increased $0.8 million for the three month period ended December 31, 2008, compared with the same period in 2007. This increase was due primarily to the aforementioned death benefit realized during the fourth quarter of 2008 from a life insurance policy. Net securities losses for the three month period ending December 31, 2008 were nominal, compared with $0.6 million in net securities gains during the three month period ending December 31, 2007. Excluding the effects of these securities transactions, noninterest income increased $4.4 million, or 27.5%, for the three months ended December 31, 2008, compared with the same period in 2007.

Noninterest expense for the year ended December 31, 2008 was $146.8 million, up from $122.5 million for the same period in 2007. Salaries and employee benefits increased $11.6 million, or 19.6%, for the year ended December 31, 2008, compared with the same period in 2007. This increase was due primarily to increases in full time equivalent employees during 2008 and reduced levels of incentive compensation in 2007 compared with 2008. The increase in full time equivalent employees was largely due to new branch activity and the aforementioned acquisition. Occupancy, equipment and data processing and communications expenses were $34.0 million for the year ended December 31, 2008, up $3.5 million, or 11.7%, from $30.5 million for the year ended December 31, 2007. This increase was due primarily to an increase in expenses related to new branch activity during the past year. Professional fees and outside services increased $1.3 million for the year ended December 31, 2008, compared with the same period in 2007, due primarily to increases in legal and audit fees incurred in 2008, as well as increases in fees related to the aforementioned noninterest income initiatives. Loan collection and other real estate owned expenses were $2.5 million for the year ended December 31, 2008, up from $1.6 million for same period in 2007. The Company recorded an other than temporary impairment charge on lease residual assets totaling $2.0 million during the third quarter of 2008 as a result of declines in the fair value of lease residual assets associated with certain leased vehicles. Other operating expenses were $19.2 million for the year ended December 31, 2008, up $4.2 million from $15.0 million for the year ended December 31, 2007. This increase resulted primarily from losses incurred from sales of certain returned lease vehicles totaling approximately $1.4 million during the period due to reduced values of those vehicles. In addition, Federal Deposit Insurance Corporation (“FDIC”) insurance premiums increased approximately $1.4 million for the year ended December 31, 2008, compared with the same period in 2007. Income tax expense for the year ended December 31, 2008 was $25.4 million, up from $21.8 million for the same period in 2007. The effective rates were 30.3% and 30.2% for the years ended December 31, 2008 and 2007, respectively.

Noninterest expense for the three months ended December 31, 2008 was $40.3 million, up from $32.4 million for the same period in 2007. Salaries and employee benefits increased $6.0 million, or 40.8%, for the three months ended December 31, 2008, compared with the same period in 2007. This increase was due primarily to increases in full time equivalent employees during 2008 and reduced levels of incentive compensation in 2007. Occupancy, equipment and data processing and communications expenses were $8.6 million for the three months ended December 31, 2008, up $0.9 million, or 11.4%, from $7.7 million for the three months ended December 31, 2007. This increase was due primarily to an increase in expenses related to the aforementioned branch openings. Other operating expenses were $5.5 million for the three months ended December 31, 2008, up $0.9 million from $4.6 million for the three months ended December 31, 2007. This increase resulted primarily from an increase in FDIC insurance premiums of approximately $0.7 million for the three month period ending December 31, 2008, compared with the same period in 2007. Income tax expense for the three month period ended December 31, 2008 was $6.2 million, up from $3.5 million for the same period in 2007. The effective rates were 29.5% and 28.1% for the three month periods ended December 31, 2008 and 2007, respectively.

Total assets were $5.3 billion at December 31, 2008, up $134.3 million or 2.6% from $5.2 billion at December 31, 2007. Loans and leases were $3.7 billion at December 31, 2008, up $196.1 million or 5.7% from $3.5 billion at December 31, 2007. The increase in loans and leases at December 31, 2008, compared with December 31, 2007, was due in large part to an increase in consumer loans of approximately $186.5 million. Total deposits were $3.9 billion at December 31, 2008, up $51.2 million or 1.3% from December 31, 2007. The increase from December 31, 2007 was due in large part to a $271.3 million, or 16.8%, increase in NOW, savings and money market accounts, partially offset by a $238.9 million decrease in time deposits. Stockholders’ equity was $431.8 million, representing a total equity to total assets ratio of 8.09% at December 31, 2008, compared with $397.3 million or a total equity to total assets ratio of 7.64% at December 31, 2007.

Due to current uncertainty in economic conditions and the financial services industry in general, it is particularly difficult to estimate certain revenues, expenses and other related matters. There may be factors in addition to those identified above that impact 2009 results. For a discussion of risks and uncertainties that could impact the Company’s future results, see “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2007 and its Quarterly Report on Form 10-Q for the quarter ended September 30, 2008.

NBT Bancorp, Inc. is a financial holding company headquartered in Norwich, NY, with total assets of $5.4 billion at December 31, 2008. The company primarily operates through NBT Bank, N.A., a full-service community bank with two divisions, and through three financial services companies. NBT Bank, N.A. has 122 locations, including 84 NBT Bank offices in upstate New York and 38 Pennstar Bank offices in northeastern Pennsylvania. EPIC Advisors, Inc., based in Rochester, NY, is a full-service 401(k) plan recordkeeping firm. Mang Insurance Agency, LLC, based in Binghamton, NY, is a full-service insurance agency. More information about NBT and its divisions can be found on the Internet at: www.nbtbancorp.com, www.nbtbank.com, www.pennstarbank.com, www.hathawayagency.com, www.epic1st.com and www.manginsurance.com.

This news release contains forward-looking statements. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of the management of NBT Bancorp and its subsidiaries and on the information available to management at the time that these statements were made. There are a number of factors, many of which are beyond NBT’s control, that could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following possibilities: (1) competitive pressures among depository and other financial institutions may increase significantly; (2) revenues may be lower than expected; (3) changes in the interest rate environment may reduce interest margins; (4) general economic conditions, either nationally or regionally, may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and/or a reduced demand for credit; (5) legislative or regulatory changes, including changes in accounting standards and tax laws, may adversely affect the businesses in which NBT is engaged; (6) competitors may have greater financial resources and develop products that enable such competitors to compete more successfully than NBT; and (7) adverse changes may occur in the securities markets or with respect to inflation. Forward-looking statements speak only as of the date they are made. Except as required by law, NBT does not undertake to update forward-looking statements to reflect subsequent circumstances or events.

							Net			Percent
	2008			2007			Change			Change
	(dollars in thousands, except per share data)

Three Months Ended December 31,
Net Income	$	14,897		$	8,985		$	5,912			66	%
Diluted Earnings Per Share	$	0.45		$	0.28		$	0.17			61	%
Weighted Average Diluted Common Shares Outstanding		32,758,405			32,398,179			360,226			1	%
Return on Average Assets (1)		1.11	%		0.69	%		0.42	%		61	%
Return on Average Equity (1)		13.88	%		9.06	%		4.82	%		53	%
Net Interest Margin (2)		4.06	%		3.61	%		0.45	%		12	%

Twelve Months Ended December 31,
Net Income	$	58,353		$	50,328		$	8,025			16	%
Diluted Earnings Per Share	$	1.80		$	1.51		$	0.29			19	%
Weighted Average Diluted Common Shares Outstanding		32,427,193			33,421,078			-993,885			-3	%
Return on Average Assets		1.11	%		0.98	%		0.13	%		13	%
Return on Average Equity		14.16	%		12.60	%		1.56	%		12	%
Net Interest Margin (2)		3.95	%		3.61	%		0.34	%		9	%

Asset Quality	December 31,			December 31,
	2008			2007
Nonaccrual Loans	$	24,191		$	29,697
90 Days Past Due and Still Accruing	$	2,305		$	882
Total Nonperforming Loans	$	26,496		$	30,579
Other Real Estate Owned	$	665		$	560
Total Nonperforming Assets	$	27,161		$	31,139
Past Due Loans	$	33,098		$	25,914
Allowance for Loan and Lease Losses	$	58,564		$	54,183
Year-to-Date (YTD) Net Charge-Offs	$	22,800		$	26,498
Allowance for Loan and Lease Losses to Total Loans and Leases		1.60	%		1.57	%
Total Nonperforming Loans to Total Loans and Leases		0.73	%		0.88	%
Total Nonperforming Assets to Total Assets		0.51	%		0.60	%
Past Due Loans to Total Loans and Leases		0.91	%		0.75	%
Allowance for Loan and Lease Losses to Total Nonperforming Loans		221.03	%		177.19	%
Net Charge-Offs to YTD Average Loans and Leases		0.64	%		0.77	%

Capital
Equity to Assets		8.09	%		7.64	%
Book Value Per Share	$	13.24		$	12.29
Tangible Book Value Per Share	$	9.01		$	8.78
Tier 1 Leverage Ratio		7.17	%		7.14	%
Tier 1 Capital Ratio		9.75	%		9.85	%
Total Risk-Based Capital Ratio		11.00	%		11.10	%

					Net			Percent
	2008		2007		Change			Change
	(dollars in thousands, except per share data)
Balance Sheet as of December 31,
Loans and Leases	$	3,651,911	$	3,455,851	$	196,060			6	%
Earning Assets	$	4,933,099	$	4,783,519	$	149,580			3	%
Total Assets	$	5,336,088	$	5,201,776	$	134,312			3	%
Deposits	$	3,923,258	$	3,872,093	$	51,165			1	%
Stockholders’ Equity	$	431,845	$	397,300	$	34,545			9	%

Average Balances
Three Months Ended December 31,
Loans and Leases	$	3,634,346	$	3,441,150	$	193,196			6	%
Securities Available For Sale (excluding unrealized gains or losses)	$	1,117,469	$	1,144,639	$	(27,170	)		-2	%
Securities Held To Maturity	$	140,141	$	143,999	$	(3,858	)		-3	%
Regulatory Equity Investment	$	39,751	$	35,073	$	4,678			13	%
Short-Term Interest Bearing Accounts	$	17,151	$	8,015	$	9,136			114	%
Total Earning Assets	$	4,948,858	$	4,772,876	$	175,982			4	%
Total Assets	$	5,349,609	$	5,148,099	$	201,510			4	%
Interest Bearing Deposits	$	3,267,893	$	3,273,248	$	(5,355	)		0	%
Non-Interest Bearing Deposits	$	695,696	$	656,784	$	38,912			6	%
Short-Term Borrowings	$	181,032	$	282,296	$	(101,264	)		-36	%
Long-Term Borrowings	$	708,867	$	477,190	$	231,677			49	%
Total Interest Bearing Liabilities	$	4,157,792	$	4,032,734	$	125,058			3	%
Stockholders’ Equity	$	426,918	$	393,333	$	33,585			9	%

Average Balances
Twelve Months Ended December 31,
Loans and Leases	$	3,567,299	$	3,425,318	$	141,981			4	%
Securities Available For Sale (excluding unrealized gains or losses)	$	1,113,810	$	1,134,837	$	(21,027	)		-2	%
Securities Held To Maturity	$	149,775	$	144,518	$	5,257			4	%
Regulatory Equity Investment	$	39,735	$	34,022	$	5,713			17	%
Short-Term Interest Bearing Accounts	$	9,190	$	8,395	$	795			9	%
Total Earning Assets	$	4,879,809	$	4,747,090	$	132,719			3	%
Total Assets	$	5,264,655	$	5,109,587	$	155,068			3	%
Interest Bearing Deposits	$	3,239,029	$	3,273,332	$	(34,303	)		-1	%
Non-Interest Bearing Deposits	$	682,656	$	639,423	$	43,233			7	%
Short-Term Borrowings	$	223,830	$	280,162	$	(56,332	)		-20	%
Long-Term Borrowings	$	638,882	$	459,439	$	179,443			39	%
Total Interest Bearing Liabilities	$	4,101,741	$	4,012,933	$	88,808			2	%
Stockholders’ Equity	$	412,102	$	399,299	$	12,803			3	%

NBT Bancorp Inc. and Subsidiaries	December 31,		December 31,
Consolidated Balance Sheets (unaudited)	2008		2007
(in thousands)

ASSETS
Cash and due from banks	$	107,409	$	155,495
Short term interest bearing accounts		2,987		7,451
Securities available for sale, at fair value		1,119,665		1,132,230
Securities held to maturity (fair value of $141,308 and $149,519 at December 31, 2008 and December 31, 2007, respectively)		140,209		149,111
Federal Reserve and Federal Home Loan Bank stock		39,045		38,102
Loans and leases		3,651,911		3,455,851
Less allowance for loan and lease losses		58,564		54,183
Net loans and leases		3,593,347		3,401,668
Premises and equipment, net		65,241		64,042
Goodwill		114,838		103,398
Intangible assets, net		23,367		10,173
Bank owned life insurance		46,030		43,614
Other assets		83,950		96,492
TOTAL ASSETS	$	5,336,088	$	5,201,776

LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Demand (noninterest bearing)	$	685,495	$	666,698
Savings, NOW, and money market		1,885,551		1,614,289
Time		1,352,212		1,591,106
Total deposits		3,923,258		3,872,093
Short-term borrowings		206,492		368,467
Long-term debt		632,209		424,887
Trust preferred debentures		75,422		75,422
Other liabilities		66,862		63,607
Total liabilities		4,904,243		4,804,476


Total stockholders' equity		431,845		397,300

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	5,336,088	$	5,201,776

	Three months ended					Twelve months ended
NBT Bancorp Inc. and Subsidiaries	December 31,					December 31,
Consolidated Statements of Income (unaudited)	2008			2007		2008		2007
(in thousands, except per share data)
Interest, fee and dividend income:
Loans and leases	$	58,164		$	60,817	$	232,155	$	242,497
Securities available for sale		13,434			13,971		54,048		54,847
Securities held to maturity		1,253			1,458		5,588		5,898
Other		436			736		2,623		2,875
Total interest, fee and dividend income		73,287			76,982		294,414		306,117
Interest expense:
Deposits		16,371			26,578		76,132		106,574
Short-term borrowings		382			3,048		4,847		12,943
Long-term debt		6,401			4,233		22,642		16,486
Trust preferred debentures		1,200			1,270		4,747		5,087
Total interest expense		24,354			35,129		108,368		141,090
Net interest income		48,933			41,853		186,046		165,027
Provision for loan and lease losses		7,721			13,440		27,181		30,094
Net interest income after provision for loan and lease losses		41,212			28,413		158,865		134,933
Noninterest income:
Trust		1,685			1,584		7,278		6,514
Service charges on deposit accounts		7,266			7,142		28,143		22,742
ATM and debit card fees		2,176			2,089		8,832		8,185
Broker/dealer and insurance revenue		3,915			1,052		8,726		4,255
Net securities (losses) gains		(8	)		613		1,535		2,113
Bank owned life insurance income		993			480		2,416		1,831
Retirement plan administration fees		1,468			1,557		6,308		6,336
Other		2,735			1,973		8,468		7,723
Total noninterest income		20,230			16,490		71,706		59,699
Noninterest expense:
Salaries and employee benefits		20,633			14,654		71,159		59,516
Office supplies and postage		1,354			1,136		5,346		5,120
Occupancy		3,385			2,948		13,781		11,630
Equipment		1,944			1,855		7,539		7,422
Professional fees and outside services		2,651			3,295		10,476		9,135
Data processing and communications		3,254			2,899		12,694		11,400
Amortization of intangible assets		874			413		2,105		1,645
Loan collection and other real estate owned		692			597		2,494		1,633
Impairment on lease residual assets		-			-		2,000		-
Other operating		5,511			4,607		19,219		15,016
Total noninterest expense		40,298			32,404		146,813		122,517
Income before income taxes		21,144			12,499		83,758		72,115
Income taxes		6,247			3,514		25,405		21,787
Net income	$	14,897		$	8,985	$	58,353	$	50,328
Earnings Per Share:
Basic	$	0.46		$	0.28	$	1.81	$	1.52
Diluted	$	0.45		$	0.28	$	1.80	$	1.51

NBT Bancorp Inc. and Subsidiaries	4Q			3Q		2Q		1Q		4Q
Quarterly Consolidated Statements of Income (unaudited)	2008			2008		2008		2008		2007
(in thousands, except per share data)
Interest, fee and dividend income:
Loans and leases	$	58,164		$	58,154	$	57,220	$	58,617	$	60,817
Securities available for sale		13,434			13,451		13,417		13,746		13,971
Securities held to maturity		1,253			1,343		1,478		1,514		1,458
Other		436			673		739		775		736
Total interest, fee and dividend income		73,287			73,621		72,854		74,652		76,982
Interest expense:
Deposits		16,371			18,351		18,712		22,698		26,578
Short-term borrowings		382			763		1,362		2,340		3,048
Long-term debt		6,401			6,310		5,629		4,302		4,233
Trust preferred debentures		1,200			1,154		1,146		1,247		1,270
Total interest expense		24,354			26,578		26,849		30,587		35,129
Net interest income		48,933			47,043		46,005		44,065		41,853
Provision for loan and lease losses		7,721			7,179		5,803		6,478		13,440
Net interest income after provision for loan and lease losses		41,212			39,864		40,202		37,587		28,413
Noninterest income:
Trust		1,685			1,720		2,099		1,774		1,584
Service charges on deposit accounts		7,266			7,414		6,938		6,525		7,142
ATM and debit card fees		2,176			2,334		2,225		2,097		2,089
Broker/dealer and insurance fees		3,915			2,338		1,366		1,107		1,052
Net securities (losses) gains		(8	)		1,510		18		15		613
Bank owned life insurance income		993			491		480		452		480
Retirement plan administration fees		1,468			1,461		1,671		1,708		1,557
Other		2,735			1,694		1,622		2,417		1,973
Total noninterest income		20,230			18,962		16,419		16,095		16,490
Noninterest expense:
Salaries and employee benefits		20,633			16,850		16,906		16,770		14,654
Office supplies and postage		1,354			1,322		1,331		1,339		1,136
Occupancy		3,385			3,359		3,427		3,610		2,948
Equipment		1,944			1,908		1,862		1,825		1,855
Professional fees and outside services		2,651			2,205		2,521		3,099		3,295
Data processing and communications		3,254			3,155		3,115		3,170		2,899
Amortization of intangible assets		874			462		378		391		413
Loan collection and other real estate owned		692			505		730		567		597
Impairment on lease residual assets		-			2,000		-		-		-
Other operating		5,511			5,292		5,153		3,263		4,607
Total noninterest expense		40,298			37,058		35,423		34,034		32,404
Income before income taxes		21,144			21,768		21,198		19,648		12,499
Income taxes		6,247			6,685		6,541		5,932		3,514
Net income	$	14,897		$	15,083	$	14,657	$	13,716	$	8,985
Earnings per share:
Basic	$	0.46		$	0.47	$	0.46	$	0.43	$	0.28
Diluted	$	0.45		$	0.46	$	0.45	$	0.43	$	0.28

Quarterly Common Stock Price	2008				2007				2006
Quarter End	High		Low		High		Low		High		Low
March 31	$	23.65	$	17.95	$	25.81	$	21.73	$	23.90	$	21.02
June 30		25.00		20.33		23.45		21.80		23.24		21.03
September 30		36.47		19.05		23.80		17.10		24.57		21.44
December 31		30.83		21.71		25.00		20.58		26.47		22.36