Slide 1: Investor Presentation Financial Results September 30, 2014
Investor Presentation Financial Results September 30, 2014
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 – Net interest margin and repricing – 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 $7.9 billion in assets • Market capitalization of $1.12 billion (at 10/31/2014, share price of $25.68) • NBT Bank, N.A. was founded in 1856 • Over 566,000 deposit accounts and 282,000 loans accounts • Over
Slide 5: Strategic Focuses
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Slide 6: Organic Loan Growth
Organic Loan Growth $4.60 $4.40 $4.44 $4.20 $4.25 $4.00 $4.02 $3.80 $3.79 $3.60 $3.40 $3.20 2011 2012 2013 2014 % Growth 6.0% 5.7% 4.5% (as compared to previous year) 2014 shown as of September 30, 2014 Loan balances shown without leasing and acquired portfolios. 6 Acquired loan portfolios excluded
Slide 7: Diversified Loan Portfolio
Diversified Loan Portfolio Portfolios as of Percent Duration 9/30/14 Total Loans = $5.6 Billion Fixed 61% 3.4 years Adjustable & 39% Variable Commercial Agricultural and Real Estate Agricultural 25% Real Estate 2% Commercial Consumer 15% 27% Residential Home Equity Real Estate Real Estate 10% 20% Co
Slide 8: Demand Deposit Account Growth
Demand Deposit Account Growth $1,800 $1,600 270 $1,400 187 1,370 $1,200 37 1,297 3 1,103 $1,000 963 $800 $600 2011 2012 2013 2014 % Growth (year over year) 18.0% 30.2% 10.5% Organic DDA Acquired DDA 2014 shown as of September 30, 2014 2012, 2013, and 2014 growth 14.6%, 17.6%, and 5.7% excluding acqu
Slide 9: Favorable Deposit Mix
Favorable Deposit Mix Interest Demand Checking, 27% Savings and MMDA 56% 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: NIM and Repricing Profile
NIM and Repricing Profile NBT and its Peer Group Excludes UMBF’s outlying position (data source as of 6/30/14) NIM and Repricing Profile 85.00 Net Assets that Re-price Beyond 3 Years Low NIM and High NIM and High High Level of Fixed Level of Fixed Rate, 75.00 TRST Rate, L-T Assets L-T Assets CBU TMP
Slide 11: Repricing Profile – Key Metrics
Repricing Profile – Key Metrics NBT Average Ranking #3 Bank Name Holding Company Ticker NIM Net Over 3 Year Position Nonint Dep/ Deposits Ranking First Midwest Bank FMBI 3.79 33.05 29.38% 1 MB Financial bank, National Association MBFI 3.58 31.87 33.56% 2 NBT Bank, National Association NBTB 3.61 30.8
Slide 12: Diverse Sources of Noninterest Income
Diverse Sources of Noninterest Income Total Noninterest Income = $79.5 million Noninterest Income / Total Revenues = 29.7% Retirement Plan Administration Fees 12% Insurance Revenue Banking 16% Services* 33% Wealth Management 25% Other As of September 30, 2014 14% Total revenues = net interest income
Slide 13: Strategic Focus on Noninterest Income Sources
Strategic Focus on Noninterest Income Sources Focus on sources has helped mitigate pressure on service charges CAGR QTD QTD Excluding Source of Fee Income 9/30/14 9/30/11 Change CAGR ALNC Banking Services Service charges on deposit accounts* $4,519 $5,532 ($1,013) -6.52% -13.11% ATM and debit card f
Slide 14: Noninterest Income Growth Strategy
Noninterest Income Growth Strategy Wealth Management • $5.7 billion in assets under management and 40,858 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 15: Organizational Transformation
Organizational Transformation
Slide 16: 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 17: Unified Branding
Unified Branding 7 HampshireFirst Bank A DIVISION OF NBT BANK, N.A. a. => FEAnK \Y Pennstar, SEincorp
Slide 18: New England Region
New England Region Year State Branches Assets Deposits Opened VT 2009 4 $361 $82 MA 2011 6 $78 $118 NH 2012 5 $276 $112 15 $715 $312 Region Highlights • Proven growth strategy − Expansion in Vermont • YOY Loan & Deposit growth 20% and 31% − Acquisitions in MA and NH in 2011 and 2012 • YOY Loan & Dep
Slide 19: New England Strategy: Maine Expansion
New England Strategy Maine Expansion • Portland Location • Targeted Focus on Corporate Clients – Commercial Banking – Wealth Management • Leadership – John H. Watt, Jr., President of Maine 19
Slide 20: New England Strategy: Rutland Vermont Office
New England Strategy Rutland Vermont Office • Opened August 12 • Established NBT Presence on Route 7 Corridor • Focus on Commercial Banking • Modest Investment 20
Slide 21: Focus on Cost Structure and Efficiencies
Focus on Cost Structure and Efficiencies Efficiency Ratio 68% 63.9% Primary drivers of the decrease in the 64% efficiency ratio from 2012: 61.9% 61.8% 63.0% • Growth in net interest income 60% – Loan growth 61.3% 61.0% 59.0% – Growth in noninterest checking 58.5% 56% • Increase in wealth management
Slide 22: Alliance Acquisition
Alliance Acquisition 22
Slide 23: Successful Integration of Alliance
Successful Integration of Alliance • Achieved 35% cost savings • Resulted in no material run off in loans and deposits • Retained key personnel • Created a franchise that began growing immediately 23
Slide 24: NBT Bancorp Financial Performance
NBT Bancorp Financial Performance NPA/Assets NIM SNL Efficiency Core ROAA Core ROATE Composite Ranking UMBF 0.2 % PVTB 51.4 % STBA 0.3 TRST 52.3 CBU 1.3 % BRKL 0.4 FFIC 57.0 STBA 1.2 CBU 0.4 ONB 4.4 % NPBC 57.1 NPBC 1.2 BHLB 0.4 CBU 3.8 CBU 57.7 PRK 1.2 CBU 18.2 % NPBC 0.5 FMBI 3.7 STBA 58.7 ONB 1.1
Slide 25: NBT Bancorp Historical Performance
NBT Bancorp Historical Performance Financial Performance Composite Ranking 2014 2013 2012 2011 2010 CBU 1 CBU 1 STBA 2 FNB 2 NPBC 3 BHLB 3 CBU 1 FNB 4 CBU 1 NPBC 3 CBU 1 STBA 2 NBTB 5 NBTB 2 NBTB 5 NBTB 2 NBTB 3 PVTB 5 FNB 3 BRKL 6 STBA 3 BRKL 4 TMP 7 NPBC 4 TMP 7 INDB 4 INDB 5 MBFI 8 BHLB 5 INDB 8
Slide 26: NBT Bancorp Stock Performance
NBT Bancorp Stock Performance Composite P/'15 EPS P / TBV YTD Stock Perf. Ranking NWBI 19.3 x UMBF 17.7 PVTB 11.7 % CBU 16.7 STBA 9.0 INDB 1 PRK 15.9 FCF 6.0 FNB 2 PVTB 15.7 CBU 2.5 x INDB 4.3 CBU 3 TRST 15.5 INDB 2.2 TRST 1.7 PRK 4 BRKL 15.5 FNB 2.2 FNB 1.3 PVTB 5 INDB 15.4 PRK 2.1 BRKL 0.4 MBFI 6
Slide 27: Capital Strength
Capital Strength NBT remains above levels considered well capitalized by regulators. 14.00% 13.00% 13.70% 12.99% 13.26% 12.00% 12.81% 12.25% 11.00% 10.00% 9.00% 9.16% 8.93% 9.20% 8.00% 8.74% 8.54% 7.00% 7.71% 7.55% 7.12% 7.03% 7.15% 6.00% 5.00% 4.00% 2010 2011 2012 2013 2014 Tier 1 Leverage Ratio To
Slide 28: Industry Recognition
Industry Recognition Ranked #23 in December 2013 Five Consecutive Years in Top 25 Ranked #25 in April 2014 Best-Performing Regional Banks SNL Financial rank uses six core financial metrics focusing on profitability, asset quality and growth 28
Slide 29: Outlook
Outlook • Mergers and Acquisitions • Continued focus on efficiencies • Asset quality • Net interest margin • Road to $10 Billion 29
Slide 30: Why Invest in NBTB?
Why Invest in NBTB? • Consistent strong 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 • Strong asset quality • Continuing success transforming to m
Slide 31: 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