Slide 1: Investor Presentation Financial Results December 31, 2013
Investor Presentation Financial Results December 31, 2013
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation may contain forward-looking statements regarding NBT Bancorp Inc. These statements constitute forward-looking information within the definition of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from any forward-
Slide 3: Index
Index 1. Corporate Overview 2. Strategic Focuses – Organic loan and deposit growth – Noninterest income growth strategy – Organizational transformation – New England market – Efficiency 3. Alliance Acquisition 4. Financial and Stock Performance 5. Outlook 3
Slide 4: Company Overview and Footprint
Company Overview and Footprint • Largest community bank headquartered in upstate New York with $7.7 billion in assets • Market capitalization of $1.0 billion (at 2/11/2014, share price of $23.25) • NBT Bank, N.A. was founded in 1856 • Over 613,000 deposit accounts and 256,000 loans accounts • 157 br
Slide 5: Strategic Focuses
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Slide 6: Organic Loan Growth
Organic Loan Growth $3.60 $3.53 $3.40 $3.36 $3.20 $3.17 $3.00 $3.04 $2.80 $2.60 2010 2011 2012 2013 % Growth 4.5% 5.8% 5.1% (as compared to previous year) 2013 shown as of December 31, 2013 Loan balances shown without mortgages, leasing and acquired portfolios 6 Dollars in billions
Slide 7: Diversified Loan Portfolio
Diversified Loan Portfolio Portfolios as of Percent Duration 12/31/13 Total Loans = $5.4 Billion Fixed 62% 3.5 years Adjustable & 38% Variable Agricultural and Commercial Agricultural Real Real Estate Estate 25% 2% Consumer Commercial 25% 16% Residential Real Home Equity Real Estate Estate 11% Const
Slide 8: DDA Deposit Growth
DDA Deposit Growth $1,500 187 $1,300 37 $1,100 1,297 3 1,103 $900 963 $700 806 $500 2010 2011 2012 2013 % Growth 19.9% 18.0% 30.2% (as compared to previous year) DDA Balance Acquired DDA 2013 shown as of December 31, 2013 2011, 2012 and 2013 growth 19.5%, 14.6%, and 17.6% excluding acquisitions, res
Slide 9: Favorable Deposit Mix
Favorable Deposit Mix Interest Demand Checking, 28% Savings and MMDA 55% Time Deposits 17% Core Deposits were 83% Core deposits are in the form of checking, savings and money market instruments. A mix with these desirable rate characteristics will be particularly important during a period of rising
Slide 10: Diverse Sources of Noninterest Income
Diverse Sources of Noninterest Income Total Noninterest Income = $101.8 million Noninterest Income / Total Revenues = 30.0% Retirement Plan Administration Fees 11% Insurance Revenue Banking Services* 18% 34% Wealth Management 23% Other 14% As of December 31, 2013 Total revenues = net interest income
Slide 11: Strategic Focus on Noninterest Income Sources
Strategic Focus on Noninterest Income Sources Focus on sources has helped mitigate pressure on service charges YTD YTD Source of Fee Income 12/31/13 12/31/10 Change CAGR Banking Services Service charges on deposit accounts* $19,307 $24,041 ($4,734) -7.05% ATM and debit card fees 15,558 10,035 5,523
Slide 12: Noninterest Income Growth Strategy
Noninterest Income Growth Strategy Wealth Management • $5.6 billion in assets under management and 39,447 accounts under management • Hired Tim Brenner in March 2012 • Acquired $905 million in assets under management with Alliance acquisition in Upstate and Western New York ─ TAC (Trust Administrati
Slide 13: Organizational Transformation
Organizational Transformation
Slide 14: Maintain Market Share in Legacy Markets and Generate Growth in New Markets
Maintain Market Share in Legacy Markets and Generate Growth in New Markets Legacy Markets New Markets •Significant market share •Market disruption •Pricing power •Acquisition of best •Strong returns in-market talent “But limited growth opportunities” •Capitalize on opportunities “Markets where we ca
Slide 15: New England Region
New England Region Year State Branches Assets Deposits Opened VT 2009 3 $315 $71 MA 2011 5 $60 $111 NH 2012 5 $245 $150 13 $620 $332 Region Highlights • Proven growth strategy − Expansion in Vermont • 26% 2013 loan growth and 22% core deposit growth − Acquisitions in MA and NH in 2011 and 2012 • 9.4
Slide 16: Focus on Cost Structure and Efficiencies
Focus on Cost Structure and Efficiencies Efficiency Ratio 68% Primary drivers of the decrease in the 64% efficiency ratio from 2012: 64% 62% 62% • Growth in net interest income – Loan growth 60% 61% 59% – Growth in noninterest checking 59% 58% 59% • Increase in wealth management 56% revenues • Strat
Slide 17: Alliance Acquisition
Alliance Acquisition • Completed successful integration • Achieved 35% cost savings • No material run off in loans and deposits • Maintained key personnel • Franchise immediately growing 17
Slide 18: Outlook
Outlook • Net interest margin • Merger and Acquisition • PA Branding 18
Slide 19: NBT Bancorp Financial Performance
NBT Bancorp Financial Performance NPA/Assets NIM SNL Efficiency Core ROAA Core ROATE Composite Ranking FFIC 50.7 % FBC 2.5 % UMBF 0.2 % PVTB 51.6 NPBC 1.2 BRKL 0.3 TRST 52.8 CBU 1.2 CBU 0.4 NPBC 56.6 PRK 1.1 STBA 0.5 PFS 57.6 MBFI 1.1 FBC 25.0 % BHLB 0.5 ONB 4.0 % CBU 59.3 ONB 1.1 CBU 18.6 NPBC 0.6
Slide 20: NBT Bancorp Stock Performance
NBT Bancorp Stock Performance Composite P/'15 EPS P / TBV YTD Stock Perf. Ranking PVTB 88.8 % MBFI 62.3 UMBF 46.7 NWBI 20.5 x CBU 45.0 UMBF 16.6 STBA 40.1 CBU 1 CBU 15.6 FMBI 40.0 UMBF 2 PVTB 15.3 TRST 36.0 PVTB 3 PRK 14.8 INDB 35.1 PRK 4 BRKL 14.7 FFIC 34.9 INDB 5 ONB 14.0 CBU 3.1 x PRK 31.6 MBFI 6
Slide 21: NBT Bancorp Historical Performance
NBT Bancorp Historical Performance Financial Performance Composite Ranking 2013 2012 2011 2010 2009 CBU 1 FNB 2 BHLB 3 CBU 1 CBU 1 NPBC 3 CBU 1 STBA 2 NBTB 2 NBTB 5 NBTB 2 NBTB 3 NBTB 1 FNB 3 BRKL 6 STBA 3 BRKL 4 TMP 2 NPBC 4 TMP 7 INDB 4 INDB 5 CBU 3 BHLB 5 INDB 8 BRKL 5 TMP 6 PRK 3 TMP 6 ONB 8 TMP
Slide 22: Ability to grow Tangible Book Value
Ability to grow Tangible Book Value Shown for last ten years $15.00 CAGR = NBTB 4.3% vs. Peer Median of 3.3% 12.80 $13.00 12.23 11.67 11.70 10.75 11.7012.23 12.09 $11.00 9.27 9.36 9.32 10.31 10.73 9.05 8.99 9.01 $9.00 9.01 8.66 8.75 8.78 8.42 7.94 $7.00 $5.00 2003 2004 2005 2006 2007 2008 2009 2010
Slide 23: Why Invest in NBTB?
Why Invest in NBTB? • Consistent financial performance (organic loan growth, core deposit growth, stable asset quality, tangible book value growth) • Proven acquirer • Low risk profile • Well capitalized • Diversified balance sheet • Continuing success transforming to markets with higher growth oppo
Slide 24: Appendix A - Our Peer Group
Appendix A - Our Peer Group NAME HQ CITY STATE TICKER Berkshire Hills Bancorp, Inc. Pittsfield MA BHLB Brookline Bancorp Inc. Boston MA BRKL Community Bank System, Inc. Dewitt NY CBU Flagstar Bancorp Inc. Troy MI FBC First Commonwealth Financial Corporation Indiana PA FCF Flushing Financial Corp. La