TrustCo is Pleased to Report Second Quarter 2021 Results;�Net Income up 28% over the Prior Year Quarter and 5.3% Average Residential Loan Growth Year over Year

GLENVILLE, N.Y., July 21, 2021 (GLOBE NEWSWIRE) — TrustCo Bank Corp NY (TrustCo, NASDAQ: TRST) today announced second quarter 2021 net income of $14.4 million or $0.748 diluted earnings per share, compared to net income of $11.3 million or $0.584 diluted earnings per share for the second quarter 2020; and net income of $28.5 million or $1.478 diluted earnings per share for the six months ended June 30, 2021, compared to net income of $24.6 million or $1.272 diluted earnings per share for the six months ended June 30, 2020. For all periods presented, share and per share information has been adjusted for the 1 for 5 reverse stock split which occurred on May 28, 2021.�

Summary
Robert J. McCormick, Chairman, President and Chief Executive Officer noted, “The people who make up the team at Trustco Bank are second to none. We have a deep and diverse talent pool that enables us to focus on short, medium, and long-term objectives all at the same time. The financial results announced today demonstrate the success of these multifaceted efforts. Working our way through and out of the COVID-19 pandemic, we were true to our “Home Town Bank” motto and helped many people in the communities we serve, while simultaneously achieving meaningful shareholder value and return.”

We not only continued without interruption our long history of paying a meaningful dividend, we also won shareholder approval of a reverse stock split that we believe will improve the company’s position in the market by making our stock attractive to a wider audience. At the same time, we also supported food banks, renewed our commitments to distressed neighborhoods, invested in affordable housing programs, aided educational programs, and encouraged savings initiatives. We also continued to assist consumer and commercial customers as they worked their way out of the hardships of the past year and are happy to report that virtually all Trustco Bank borrowers who received pandemic relief are making payments as agreed.

Our team is never one to rest on its successes. Our entire management team, from those leading our branches to the heads of our internal departments, are focused on generating new business by reaching an ever-expanding consumer audience with our industry-leading residential mortgage products and developing new relationships with commercial customers who share our forward-looking and success-oriented vision. As always, we pursue these objectives with our trademark efficiency.

Details

Average loans were up $158.6 million or 3.8% in the second quarter 2021 over the same period in 2020. Average residential loans, our primary lending focus, were up $193.9 million, or 5.3%, in the second quarter 2021 over the same period in 2020. As of June 30, 2021, loans in deferral were not material. Additionally, the Bank had funded 663 Paycheck Protection Program (“PPP”) loans totaling $46 million in 2020, and an additional 343 loans totaling $23 million in the first half of 2021. As of June 30, 2021, 526 PPP loans totaling $32 million remain outstanding. Average deposits were up $507.8 million or 10.8% for the second quarter 2021 over the same period a year earlier. The increase in deposits was the result of a $701.8 million or 21.2% increase in total average core deposit accounts, which consist of interest bearing and non-interest bearing checking, savings and money market deposits, offset by a decrease in average time deposits of $194.1 million or 13.9%, for the second quarter 2021 over the same period in 2020. Within the core deposits, checking balances were up $399.5 million or 26.6% (including interest bearing and non-interest bearing checking balances), money market balances were up $87.5 million or 13.6%, and savings balances were up $214.8 million or 18.4%. We believe the increase in core deposits 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. As we move forward, the objective is to encourage customers to retain these additional funds in the expanded product offerings of the Bank through aggressive marketing and product differentiation.  

The cost of interest bearing liabilities decreased to 0.17% in the second quarter 2021 from 0.64% in the second quarter 2020. A significant portion of our CD portfolio (time deposits) repriced during the last year, which resulted in lower rates as a result of the ongoing market conditions. The net interest margin for the second quarter 2021 was 2.70%, down 11 basis points from 2.81% in the second quarter of 2020. This was primarily due to the decrease in market rates resulting in less interest earned on our short-term funds, residential and variable rate loans.

The Bank continued to demonstrate its ability to grow shareholders’ equity as average equity was up $24.3 million or 4.4% in the second quarter of 2021 compared to the same period in 2020. Return on average assets and return on average equity for the second quarter 2021 were 0.95% and 10.05%, respectively, compared to 0.82% and 8.21% for the second quarter 2020. Improving efficiencies to reduce costs continues to remain a key area of focus.   As a result, full time equivalent employees decreased from the prior year and quarter partially due to a strategic realignment and the impact of COVID-19 on the labor market. The Bank also purchased 20 thousand shares of stock under the announced Repurchase Plan. Additionally, as previously announced, the reverse split of the Company’s Common Stock at a ratio of 1 for 5 was implemented on the Nasdaq Global Select Market on May 28, 2021. All prior period share and per share information, and common stock and surplus amounts have been split adjusted. The board of directors believes that the Reverse Stock Split will likely result in a higher per share trading price, which is intended to generate greater investor interest in TrustCo and improve the marketability of the shares to a broader range of investors. The board of directors also believes that the Reverse Stock Split will result in a number of our shares of outstanding common stock that is similar to the number of outstanding shares of common stock of comparable financial institutions.     

Asset quality and loan loss reserve measures have stayed consistent. Nonperforming loans (NPLs) were $20.8 million at June 30, 2021, compared to $21.9 million at June 30, 2020. NPLs were 0.48% and 0.52% of total loans at June 30, 2021 and 2020, respectively. The coverage ratio, or allowance for loan losses to NPLs, was 240.9% at June 30, 2021, compared to 219.5% at June 30, 2020. Nonperforming assets (NPAs) were $21.1 million at June 30, 2021, compared to $22.8 million at June 30, 2020. The ratio of allowance for loan losses to total loans was 1.15% as of both June 30, 2021 and 2020. The allowance for loan losses was $50.2 million at June 30, 2021, compared to $48.1 million at June 30, 2020. There was no provision for loan losses for the second quarter 2021 consistent with improved asset quality trends and economic conditions. Provision for loan losses for the second quarter of 2020 was $2 million driven by the beginning of the uncertainty in the economic environment resulting from the COVID-19 pandemic. The Company had previously elected to delay its adoption of Accounting Standards Update 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“CECL”), as provided by the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) until the date on which the National Emergency concerning COVID-19 was terminated or December 31, 2020, whichever occurred first.  The December 31, 2020 adoption date under the CARES Act was extended to January 1, 2022 as a part of the COVID-19 relief legislation, which became law in December 2020, and therefore the Company intends to adopt CECL on January 1, 2022.

Net recoveries for the second quarter 2021 were $164 thousand versus net chargeoffs in the second quarter 2020 of $11 thousand. The annualized net (recoveries) chargeoffs ratio was (0.02)% and 0.00% for the second quarter 2021 and 2020, respectively.

At June 30, 2021 the equity to asset ratio was 9.45%, compared to 9.75% at June 30, 2020. Book value per share at June 30, 2021 was $30.00, up 4.6% compared to $28.67 a year earlier.

TrustCo Bank Corp NY is a $6.1 billion savings and loan holding company and through its subsidiary, Trustco Bank, operated 147 offices in New York, New Jersey, Vermont, Massachusetts, and Florida at June 30, 2021.

In addition, the Bank’s Financial Services 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.

A conference call to discuss second quarter 2021 results will be held at 9:00 a.m. Eastern Time on July 22, 2021. Those wishing to participate in the call may dial toll-free 1-888-339-0764. International callers must dial 1-412-902-4195. Please ask to be joined into the TrustCo Bank Corp NY / TRST call. A replay of the call will be available for thirty days by dialing 1-877-344-7529 (1-412-317-0088 for international callers), Conference Number 10158543. The call will also be audio webcast at: https://services.choruscall.com/links/trst210722.html, and will be available for one year.

Safe Harbor Statement
All statements in this news release that are not historical are forward-looking statements within the meaning of the Securities Exchange Act of 1934, as amended. 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 periods. Examples of forward-looking statements include, among others, statements we make regarding our expectations for our performance during 2021, including our expectations regarding the effects of COVID-19 on our financial results and our ability to assist our customers in addressing the effects of COVID-19, our expectations with respect to the effect of our proposed reverse stock split of our common stock, including the impact of such split on the trading price of our common stock, our ability to retain customer products, the impact of Federal Reserve actions regarding interest rates and the growth of loans and deposits throughout our branch network and our ability to capitalize on economic changes in the areas in which we operate. Such forward-looking statements are subject to factors that could cause actual results to differ materially for TrustCo from those discussed, and many of the risks and uncertainties are heightened by or may, in the future, be heightened by the effects of the COVID-19 pandemic. 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: the effect of the COVID-19 pandemic on our business, financial condition, liquidity and results of operations; the impact of the actions taken by governmental authorities to contain COVID-19 or address the impact of COVID-19 on the economy, and the effect of all of such items on our operations, liquidity and capital position, and on the financial condition of our borrowers and other customers; future business strategies related to the implementation of CECL; our ability to continue to originate a significant volume of one-to-four family mortgage loans in our market areas; our ability to continue to maintain noninterest expense and other overhead costs at reasonable levels relative to income; our ability to make accurate assumptions and judgments regarding the credit risks associated with lending and investing activities; the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board, inflation, interest rates, market and monetary fluctuations; restrictions or conditions imposed by our regulators on our operations that may make it more difficult for us to achieve our goals; the future earnings and capital levels of us and Trustco Bank and the continued receipt of approvals from our primary federal banking regulators under regulatory rules to distribute capital to TrustCo, which could affect our ability to pay dividends; results of supervisory monitoring or examinations of Trustco Bank and TrustCo by our respective regulators; adverse conditions in the securities markets that lead to impairment in the value of securities in our investment portfolio; unanticipated effects from the Tax Cut and Jobs Act that may limit its benefits or adversely impact our business; the perceived overall value of our products and services by users, including in comparison to competitors’ products and services and the willingness of current and prospective customers to substitute competitors’ products and services for our products and services; changes in consumer spending, borrowing and saving habits; the effect of changes in financial services laws and regulations and the impact of other governmental initiatives affecting the financial services industry; changes in management personnel; real estate and collateral values; changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the FASB or PCAOB; disruptions, security breaches, or other adverse events affecting the third-party vendors who perform several of our critical processing functions; technological changes and electronic, cyber and physical security breaches; changes in local market areas and general business and economic trends, as well as changes in consumer spending and saving habits; our success at managing the risks involved in the foregoing and managing our business; 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.

Subsidiary:	Trustco Bank
Contact:	Robert Leonard
	Executive Vice President and
	Chief Risk Officer
	(518) 381-3693

TRUSTCO BANK CORP NY
GLENVILLE, NY
FINANCIAL HIGHLIGHTS
(dollars in thousands, except per share data)
(Unaudited)
		Three months ended
		6/30/2021			3/31/2021			6/30/2020
Summary of operations
Net interest income (TE)	$	40,122			40,107			37,681
Provision for loan losses		–			350			2,000
Noninterest income		4,688			4,428			3,426
Noninterest expense		25,440			25,335			23,932
Net income		14,433			14,083			11,254
Per share (4)
Net income per share:
- Basic	$	0.749			0.730			0.584
- Diluted		0.748			0.730			0.584
Cash dividends		0.341			0.341			0.341
Book value at period end		30.00			29.60			28.67
Market price at period end		34.38			36.85			31.65
At period end
Full time equivalent employees		769			820			806
Full service banking offices		147			148			148
Performance ratios
Return on average assets		0.95	%		0.96			0.82
Return on average equity		10.05			10.01			8.21
Efficiency (1)		56.91			56.35			58.30
Net interest spread (TE)		2.66			2.74			2.69
Net interest margin (TE)		2.70			2.78			2.81
Dividend payout ratio		45.51			46.65			58.37
Capital ratios at period end
Consolidated tangible equity to tangible assets (2)		9.44	%		9.44			9.74
Consolidated equity to assets		9.45	%		9.44			9.75
Asset quality analysis at period end
Nonperforming loans to total loans		0.48			0.51			0.52
Nonperforming assets to total assets		0.34			0.36			0.40
Allowance for loan losses to total loans		1.15			1.17			1.15
Coverage ratio (3)		2.4x			2.3x			2.2x
(1) Non-GAAP measure; calculated as noninterest expense (excluding ORE income/expense) divided by taxable equivalent net interest income plus noninterest income. See Non-GAAP Financial Measures Reconciliation.
(2) Non-GAAP measure; calculated as total equity less $553 of intangible assets divided by total assets less $553 of intangible assets. See Non-GAAP Financial Measures Reconciliation.
(3) Calculated as allowance for loan losses divided by total nonperforming loans.
(4) All periods presented have been adjusted for the 1 for 5 reverse stock split which occurred on May 28, 2021.
TE = Taxable equivalent

FINANCIAL HIGHLIGHTS, Continued
(dollars in thousands, except per share data)
(Unaudited)
		Six months ended
		06/30/21			06/30/20
Summary of operations
Net interest income (TE)	$	80,229			76,235
Provision for loan losses		350			4,000
Net gain on securities transactions		–			1,155
Noninterest income, excluding net gain on securities transactions		9,116			7,605
Noninterest expense		50,775			48,200
Net income		28,516			24,567
Per share (2)
Net income per share:
- Basic	$	1.479			1.272
- Diluted		1.478			1.272
Cash dividends		0.681			0.681
Book value at period end		30.00			28.67
Market price at period end		34.38			31.65
Performance ratios
Return on average assets		0.96			0.92
Return on average equity		10.03			9.04
Efficiency (1)		56.63			57.30
Net interest spread (TE)		2.70			2.80
Net interest margin (TE)		2.74			2.93
Dividend payout ratio		46.07			53.52
(1) Calculated as noninterest expense (excluding ORE income/expense) divided by taxable equivalent net interest income plus noninterest income. See Non-GAAP Financial Measures Reconciliation.
(2) All periods presented have been adjusted for the 1 for 5 reverse stock split which occurred on May 28, 2021.
TE = Taxable equivalent.

CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except per share data)
(Unaudited)
		Three months ended
		6/30/2021			3/31/2021			12/31/2020			9/30/2020			6/30/2020
Interest and dividend income:
Interest and fees on loans	$	39,808			40,217			40,906			41,330			41,665
Interest and dividends on securities available for sale:
U. S. government sponsored enterprises		97			50			27			14			106
State and political subdivisions		–			1			2			1			2
Mortgage-backed securities and collateralized mortgage
obligations – residential		1,167			1,237			1,172			1,319			1,527
Corporate bonds		323			316			349			646			488
Small Business Administration – guaranteed
participation securities		193			206			212			216			229
Other securities		5			6			7			5			5
Total interest and dividends on securities available for sale		1,785			1,816			1,769			2,201			2,357
Interest on held to maturity securities:
Mortgage-backed securities and collateralized mortgage
obligations – residential		111			123			129			138			162
Total interest on held to maturity securities		111			123			129			138			162
Federal Reserve Bank and Federal Home Loan Bank stock		65			69			70			77			192
Interest on federal funds sold and other short-term investments		286			270			246			242			193
Total interest income		42,055			42,495			43,120			43,988			44,569
Interest expense:
Interest on deposits:
Interest-bearing checking		46			52			51			55			26
Savings		162			159			156			161			166
Money market deposit accounts		236			283			447			637			862
Time deposits		1,261			1,666			3,053			4,749			5,599
Interest on short-term borrowings		228			228			232			221			235
Total interest expense		1,933			2,388			3,939			5,823			6,888
Net interest income		40,122			40,107			39,181			38,165			37,681
Less: Provision for loan losses		–			350			600			1,000			2,000
Net interest income after provision for loan losses		40,122			39,757			38,581			37,165			35,681
Noninterest income:
Trustco Financial Services income		1,999			2,035			1,527			1,784			1,368
Fees for services to customers		2,486			2,204			2,365			2,292			1,807
Other		203			189			177			265			251
Total noninterest income		4,688			4,428			4,069			4,341			3,426
Noninterest expenses:
Salaries and employee benefits		12,403			12,425			11,727			10,899			11,648
Net occupancy expense		4,328			4,586			4,551			4,277			4,385
Equipment expense		1,600			1,631			1,621			1,607			1,606
Professional services		1,614			1,432			1,644			1,311			1,182
Outsourced services		2,169			2,250			1,925			1,875			1,875
Advertising expense		549			354			527			305			601
FDIC and other insurance		777			707			657			660			609
Other real estate (income) expense, net		(60	)		239			45			(115	)		(32	)
Other		2,060			1,711			2,133			1,855			2,058
Total noninterest expenses		25,440			25,335			24,830			22,674			23,932
Income before taxes		19,370			18,850			17,820			18,832			15,175
Income taxes		4,937			4,767			4,006			4,761			3,921
Net income	$	14,433			14,083			13,814			14,071			11,254
Net income per common share (1):
- Basic	$	0.749			0.730			0.716			0.730			0.584
- Diluted		0.748			0.730			0.716			0.730			0.584
Average basic shares (in thousands) (1)		19,281			19,287			19,287			19,287			19,287
Average diluted shares (in thousands) (1)		19,290			19,293			19,288			19,288			19,287
Note: Taxable equivalent net interest income	$	40,122			40,107			39,182			38,166			37,681
(1) All periods presented have been adjusted for the 1 for 5 reverse stock split which occurred on May 28, 2021.

CONSOLIDATED STATEMENTS OF INCOME, Continued
(dollars in thousands, except per share data)
(Unaudited)
		Six months ended
		06/30/21			06/30/20
Interest and dividend income:
Interest and fees on loans	$	80,025			83,728
Interest and dividends on securities available for sale:
U. S. government sponsored enterprises		147			527
State and political subdivisions		1			3
Mortgage-backed securities and collateralized mortgage
obligations – residential		2,404			3,640
Corporate bonds		639			726
Small Business Administration – guaranteed
participation securities		399			474
Other securities		11			11
Total interest and dividends on securities available for sale		3,601			5,381
Interest on held to maturity securities:
Mortgage-backed securities-residential		234			337
Total interest on held to maturity securities		234			337
Federal Reserve Bank and Federal Home Loan Bank stock		134			274
Interest on federal funds sold and other short-term investments		556			1,460
Total interest income		84,550			91,180
Interest expense:
Interest on deposits:
Interest-bearing checking		98			42
Savings		321			399
Money market deposit accounts		519			1,958
Time deposits		2,927			11,990
Interest on short-term borrowings		456			557
Total interest expense		4,321			14,946
Net interest income		80,229			76,234
Less: Provision for loan losses		350			4,000
Net interest income after provision for loan losses		79,879			72,234
Noninterest income:
Trustco Financial Services income		4,034			2,968
Fees for services to customers		4,690			4,122
Net gain on securities transactions		–			1,155
Other		392			515
Total noninterest income		9,116			8,760
Noninterest expenses:
Salaries and employee benefits		24,828			23,021
Net occupancy expense		8,914			8,691
Equipment expense		3,231			3,408
Professional services		3,046			2,663
Outsourced services		4,419			3,950
Advertising expense		903			1,089
FDIC and other insurance		1,484			903
Other real estate expense, net		179			162
Other		3,771			4,313
Total noninterest expenses		50,775			48,200
Income before taxes		38,220			32,794
Income taxes		9,704			8,227
Net income	$	28,516			24,567
Net income per common share (1):
- Basic	$	1.479			1.272
- Diluted		1.478			1.272
Average basic shares (in thousands) (1)		19,284			19,316
Average diluted shares (in thousands) (1)		19,292			19,319
Note: Taxable equivalent net interest income	$	80,229			76,235
(1) All periods presented have been adjusted for the 1 for 5 reverse stock split which occurred on May 28, 2021.

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(dollars in thousands)
(Unaudited)
		6/30/2021			3/31/2021			12/31/2020			9/30/2020			6/30/2020
ASSETS:
Cash and due from banks	$	47,766			45,493			47,196			47,703			44,726
Federal funds sold and other short term investments		1,134,622			1,094,880			1,059,903			908,616			908,110
Total cash and cash equivalents		1,182,388			1,140,373			1,107,099			956,319			952,836
Securities available for sale:
U. S. government sponsored enterprises		74,579			74,465			19,968			29,996			–
States and political subdivisions		48			48			103			111			111
Mortgage-backed securities and collateralized mortgage
obligations – residential		315,656			348,317			316,158			309,768			331,469
Small Business Administration – guaranteed
participation securities		37,199			39,232			42,217			44,070			45,998
Corporate bonds		54,647			64,839			59,939			70,113			54,439
Other securities		686			686			686			685			685
Total securities available for sale		482,815			527,587			439,071			454,743			432,702
Held to maturity securities:
Mortgage-backed securities and collateralized mortgage
obligations-residential		11,665			12,729			13,824			15,094			16,633
Total held to maturity securities		11,665			12,729			13,824			15,094			16,633
Federal Reserve Bank and Federal Home Loan Bank stock		5,604			5,506			5,506			5,506			5,506
Loans:
Commercial		214,164			217,021			212,492			231,663			231,212
Residential mortgage loans		3,892,351			3,807,837			3,780,167			3,724,746			3,681,898
Home equity line of credit		234,214			235,644			242,194			248,320			254,445
Installment loans		8,638			8,670			9,617			9,826			10,006
Loans, net of deferred net costs		4,349,367			4,269,172			4,244,470			4,214,555			4,177,561
Less: Allowance for loan losses		50,155			49,991			49,595			49,123			48,144
Net loans		4,299,212			4,219,181			4,194,875			4,165,432			4,129,417
Bank premises and equipment, net		33,691			34,012			34,412			34,417			34,042
Operating lease right-of-use assets		45,825			46,614			47,885			47,174			48,712
Other assets		61,378			60,455			59,124			57,244			57,155
Total assets	$	6,122,578			6,046,457			5,901,796			5,735,929			5,677,003
LIABILITIES:
Deposits:
Demand	$	765,193			718,343			652,756			635,345			612,960
Interest-bearing checking		1,152,901			1,141,595			1,086,558			1,024,290			1,001,592
Savings accounts		1,409,556			1,362,141			1,285,501			1,235,259			1,191,682
Money market deposit accounts		732,963			719,580			716,005			699,132			666,304
Time deposits		1,169,907			1,231,263			1,296,373			1,305,024			1,392,769
Total deposits		5,230,520			5,172,922			5,037,193			4,899,050			4,865,307
Short-term borrowings		237,791			229,950			214,755			193,455			177,278
Operating lease liabilities		50,586			51,449			52,784			52,125			53,710
Accrued expenses and other liabilities		25,088			21,105			28,903			30,771			27,287
Total liabilities		5,543,985			5,475,426			5,333,635			5,175,401			5,123,582
SHAREHOLDERS’ EQUITY:
Capital stock (1)		20,041			20,044			20,041			20,041			20,041
Surplus (1)		256,536			256,674			256,606			256,605			256,601
Undivided profits		329,350			321,486			313,974			306,741			299,239
Accumulated other comprehensive income, net of tax		7,840			7,268			11,936			11,537			11,936
Treasury stock at cost		(35,174	)		(34,441	)		(34,396	)		(34,396	)		(34,396	)
Total shareholders’ equity		578,593			571,031			568,161			560,528			553,421
Total liabilities and shareholders’ equity	$	6,122,578			6,046,457			5,901,796			5,735,929			5,677,003
Outstanding shares (in thousands) (1)		19,265			19,288			19,287			19,287			19,287
(1) All periods presented have been adjusted for the 1 for 5 reverse stock split which occurred on May 28, 2021.

NONPERFORMING ASSETS
(dollars in thousands)
(Unaudited)
		6/30/2021		3/31/2021		12/31/2020		9/30/2020		6/30/2020
Nonperforming Assets
New York and other states*
Loans in nonaccrual status:
Commercial	$	150		125		452		491		571
Real estate mortgage – 1 to 4 family		18,466		19,826		19,379		19,977		20,215
Installment		43		32		43		49		6
Total non-accrual loans		18,659		19,983		19,874		20,517		20,792
Other nonperforming real estate mortgages – 1 to 4 family		20		22		23		25		26
Total nonperforming loans		18,679		20,005		19,897		20,542		20,818
Other real estate owned		251		420		541		423		830
Total nonperforming assets	$	18,930		20,425		20,438		20,965		21,648
Florida
Loans in nonaccrual status:
Commercial	$	–		–		–		–		–
Real estate mortgage – 1 to 4 family		2,142		1,626		1,187		1,254		1,111
Installment		–		–		–		–		–
Total non-accrual loans		2,142		1,626		1,187		1,254		1,111
Other nonperforming real estate mortgages – 1 to 4 family		–		–		–		–		–
Total nonperforming loans		2,142		1,626		1,187		1,254		1,111
Other real estate owned		–		–		–		–		–
Total nonperforming assets	$	2,142		1,626		1,187		1,254		1,111
Total
Loans in nonaccrual status:
Commercial	$	150		125		452		491		571
Real estate mortgage – 1 to 4 family		20,608		21,452		20,566		21,231		21,326
Installment		43		32		43		49		6
Total non-accrual loans		20,801		21,609		21,061		21,771		21,903
Other nonperforming real estate mortgages – 1 to 4 family		20		22		23		25		26
Total nonperforming loans		20,821		21,631		21,084		21,796		21,929
Other real estate owned		251		420		541		423		830
Total nonperforming assets	$	21,072		22,051		21,625		22,219		22,759
Quarterly Net (Recoveries) Chargeoffs
New York and other states*
Commercial	$	–		(32	)	32		(1	)	(6	)
Real estate mortgage – 1 to 4 family		(136	)	(2	)	(27	)	4		(27	)
Installment		(27	)	(14	)	109		18		44
Total net (recoveries) chargeoffs	$	(163	)	(48	)	114		21		11
Florida
Commercial	$	–		–		–		–		–
Real estate mortgage – 1 to 4 family		(1	)	–		(1	)	–		–
Installment		–		2		15		–		–
Total net (recoveries) chargeoffs	$	(1	)	2		14		–		–
Total
Commercial	$	–		(32	)	32		(1	)	(6	)
Real estate mortgage – 1 to 4 family		(137	)	(2	)	(28	)	4		(27	)
Installment		(27	)	(12	)	124		18		44
Total net (recoveries) chargeoffs	$	(164	)	(46	)	128		21		11
Asset Quality Ratios
Total nonperforming loans (1)	$	20,821		21,631		21,084		21,796		21,929
Total nonperforming assets (1)		21,072		22,051		21,625		22,219		22,759
Total net (recoveries) chargeoffs (2)		(164	)	(46	)	128		21		11
Allowance for loan losses (1)		50,155		49,991		49,595		49,123		48,144
Nonperforming loans to total loans		0.48	%	0.51	%	0.50	%	0.52	%	0.52	%
Nonperforming assets to total assets		0.34	%	0.36	%	0.37	%	0.39	%	0.40	%
Allowance for loan losses to total loans		1.15	%	1.17	%	1.17	%	1.17	%	1.15	%
Coverage ratio (1)		240.9	%	231.1	%	235.2	%	225.4	%	219.5	%
Annualized net (recoveries) chargeoffs to average loans (2)		-0.02	%	0.00	%	0.01	%	0.00	%	0.00	%
Allowance for loan losses to annualized net (recoveries) chargeoffs (2)		N/A		N/A		96.9x		584.8x		1094.2x
* Includes New York, New Jersey, Vermont and Massachusetts.
(1) At period-end
(2) For the period ended

DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS’ EQUITY –
INTEREST RATES AND INTEREST DIFFERENTIAL
(dollars in thousands)
(Unaudited)		Three months ended							Three months ended
		June 30, 2021							June 30, 2020
		Average			Interest	Average			Average			Interest		Average
		Balance				Rate			Balance					Rate
Assets
Securities available for sale:
U. S. government sponsored enterprises	$	74,971			97	0.52	%	$	23,291			106		1.83	%
Mortgage backed securities and collateralized mortgage
obligations – residential		327,332			1,167	1.43			333,122			1,527		1.83
State and political subdivisions		48			–	–			110			2		7.90
Corporate bonds		57,021			323	2.27			51,494			488		3.79
Small Business Administration – guaranteed
participation securities		36,839			193	2.09			45,260			229		2.03
Other		686			5	2.92			685			5		2.92
Total securities available for sale		496,897			1,785	1.44			453,962			2,357		2.08
Federal funds sold and other short-term Investments		1,126,298			286	0.10			727,006			193		0.11
Held to maturity securities:
Mortgage backed securities and collateralized mortgage
obligations – residential		12,179			111	3.67			17,199			162		3.75
Total held to maturity securities		12,179			111	3.67			17,199			162		3.75
Federal Reserve Bank and Federal Home Loan Bank stock		5,598			65	4.64			9,332			192		8.23
Commercial loans		214,912			2,608	4.85			223,002			2,610		4.68
Residential mortgage loans		3,847,274			34,836	3.62			3,653,342			36,365		3.98
Home equity lines of credit		234,476			2,211	3.78			260,029			2,515		3.89
Installment loans		8,349			153	7.34			10,044			175		7.02
Loans, net of unearned income		4,305,011			39,808	3.70			4,146,417			41,665		4.02
Total interest earning assets		5,945,983			42,055	2.83			5,353,916			44,569		3.33
Allowance for loan losses		(50,196	)						(46,832	)
Cash & non-interest earning assets		197,561							195,815
Total assets	$	6,093,348						$	5,502,899
Liabilities and shareholders’ equity
Deposits:
Interest bearing checking accounts	$	1,149,296			46	0.02	%	$	953,299			26		0.01	%
Money market accounts		729,136			236	0.13			641,593			862		0.54
Savings		1,382,604			162	0.05			1,167,844			166		0.06
Time deposits		1,198,064			1,261	0.42			1,392,136			5,599		1.62
Total interest bearing deposits		4,459,100			1,705	0.15			4,154,872			6,653		0.64
Short-term borrowings		233,426			228	0.39			172,834			235		0.55
Total interest bearing liabilities		4,692,526			1,933	0.17			4,327,706			6,888		0.64
Demand deposits		751,719							548,178
Other liabilities		73,368							75,603
Shareholders’ equity		575,735							551,412
Total liabilities and shareholders’ equity	$	6,093,348						$	5,502,899
Net interest income, tax equivalent					40,122							37,681
Net interest spread						2.66	%							2.69	%
Net interest margin (net interest income to
total interest earning assets)						2.70	%							2.81	%
Tax equivalent adjustment					–							–
Net interest income					40,122							37,681

DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS’ EQUITY –
INTEREST RATES AND INTEREST DIFFERENTIAL, Continued
(dollars in thousands)
(Unaudited)		Six months ended							Six months ended
		June 30, 2021							June 30, 2020
		Average			Interest	Average			Average			Interest		Average
		Balance				Rate			Balance					Rate
Assets
Securities available for sale:
U. S. government sponsored enterprises	$	63,374			147	0.46	%	$	57,830			527		1.82	%
Mortgage backed securities and collateralized mortgage
obligations – residential		327,472			2,404	1.47			352,445			3,640		2.07
State and political subdivisions		49			1	6.60			112			4		7.74
Corporate bonds		60,160			639	2.12			39,913			726		3.64
Small Business Administration – guaranteed
participation securities		38,203			399	2.09			46,339			474		2.05
Other		687			11	3.20			685			11		3.21
Total securities available for sale		489,945			3,601	1.47			497,324			5,382		2.16
Federal funds sold and other short-term Investments		1,078,201			556	0.10			569,541			1,460		0.52
Held to maturity securities:
Mortgage backed securities and collateralized mortgage
obligations – residential		12,723			234	3.68			17,671			337		3.81
Total held to maturity securities		12,723			234	3.68			17,671			337		3.81
Federal Reserve Bank and Federal Home Loan Bank stock		5,552			134	4.83			9,258			274		5.92
Commercial loans		213,853			5,554	5.19			210,524			5,152		4.89
Residential mortgage loans		3,818,426			69,687	3.65			3,627,535			72,826		4.02
Home equity lines of credit		236,417			4,471	3.81			262,745			5,383		4.12
Installment loans		8,573			313	7.37			10,380			367		7.11
Loans, net of unearned income		4,277,269			80,025	3.75			4,111,184			83,728		4.08
Total interest earning assets		5,863,690			84,550	2.89			5,204,978			91,181		3.51
Allowance for loan losses		(50,071	)						(45,676	)
Cash & non-interest earning assets		197,682							194,718
Total assets	$	6,011,301						$	5,354,020
Liabilities and shareholders’ equity
Deposits:
Interest bearing checking accounts	$	1,117,113			98	0.02	%	$	912,226			42		0.01	%
Money market accounts		727,363			519	0.14			627,897			1,958		0.63
Savings		1,349,013			321	0.05			1,142,201			399		0.07
Time deposits		1,229,838			2,927	0.48			1,381,025			11,990		1.75
Total interest bearing deposits		4,423,327			3,865	0.18			4,063,349			14,389		0.71
Short-term borrowings		228,643			456	0.40			163,251			557		0.69
Total interest bearing liabilities		4,651,970			4,321	0.19			4,226,600			14,946		0.71
Demand deposits		712,790							503,327
Other liabilities		73,276							77,303
Shareholders’ equity		573,265							546,790
Total liabilities and shareholders’ equity	$	6,011,301						$	5,354,020
Net interest income, tax equivalent					80,229							76,235
Net interest spread						2.70	%							2.80	%
Net interest margin (net interest income to
total interest earning assets)						2.74	%							2.93	%
Tax equivalent adjustment					–							(1	)
Net interest income					80,229							76,234

Non-GAAP Financial Measures Reconciliation

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 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.

The efficiency ratio is a non-GAAP measure of expense control relative to revenue from net interest income and fee income. We calculate the efficiency ratio by dividing total noninterest expenses as determined under GAAP, but excluding other real estate expense, net, by net interest income (fully taxable equivalent) and total noninterest income as determined under GAAP, but excluding net gains on the sale of securities and other non-routine items from this calculation. We believe that this provides a reasonable measure of primary banking expenses relative to primary banking revenue.

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 common equity, tangible book value per share, efficiency ratio, net income and net income per share to the underlying GAAP numbers is set forth below.

NON-GAAP FINANCIAL MEASURES RECONCILIATION
(dollars in thousands, except per share amounts)
(Unaudited)
		6/30/2021		3/31/2021		6/30/2020
Tangible Equity to Tangible Assets
Total Assets (GAAP)	$	6,122,578		6,046,457		5,677,003
Less: Intangible assets		553		553		553
Tangible assets (Non-GAAP)		6,122,025		6,045,904		5,676,450
Equity (GAAP)		578,593		571,031		553,421
Less: Intangible assets		553		553		553
Tangible equity (Non-GAAP)		578,040		570,478		552,868
Tangible Equity to Tangible Assets (Non-GAAP)		9.44	%	9.44	%	9.74	%
Equity to Assets (GAAP)		9.45	%	9.44	%	9.75	%
		Three months ended								Six months ended
Efficiency Ratio		6/30/2021		3/31/2021		6/30/2020				6/30/2021		6/30/2020
Net interest income (fully taxable equivalent) (Non-GAAP)	$	40,122		40,107		37,681			$	80,229		76,235
Non-interest income (GAAP)		4,688		4,428		3,426				9,116		8,760
Less: Net gain on securities		–		–		–				–		1,155
Revenue used for efficiency ratio (Non-GAAP)		44,810		44,535		41,107				89,345		83,840
Total noninterest expense (GAAP)		25,440		25,335		23,932				50,775		48,200
Less: Other real estate (income) expense, net		(60	)	239		(32	)			179		162
Expense used for efficiency ratio (Non-GAAP)		25,500		25,096		23,964				50,596		48,038
Efficiency Ratio		56.91	%	56.35	%	58.30	%			56.63	%	57.30	%