Arrow Financial Corporation · NASDAQ:AROW
Arrow Financial — Q4 2025 Earnings Presentation
48 slides from Arrow Financial's earnings presentation, Jan 29, 2026
Slide 1: 4Q 2025 Investor Presentation
4Q 2025 Investor Presentation January 29, 2026
Slide 2: Safe Harbor
Safe Harbor The information contained in this investor presentation may contain statements that are not historical in nature but rather are based on management’s beliefs, assumptions, expectations, estimates and projections about the future. These statements can sometimes be identified by Arrow's us
Slide 3: Table of Contents
Table of Contents • 4Q25 and FY2025 Results and Performance Metrics • Non-Interest Income/Expense • Loans • Deposits/Funding Sources • Credit Quality • Investments • Capital Actions and Ownership • Overview and History 3
Slide 4: Results
Results ~ =\RROW Financial Corporation
Slide 5: 4Q25 Summary
4Q25 Summary Earnings Return on Record Return on Per Share Average Assets FTE NIM Average Equity $0.85 1.24% 3.25% 13.08% vs 3.24% (3Q) Tangible Book Net Charge-Offs NPLs $8.5M; Value per Share 0.08% 0.24% $24.71 of Total Loans Strong finish to 2025 – well positioned for 2026 Financial information p
Slide 6: FY2025 Summary
FY2025 Summary Earnings Return on Record 2025 Return on Per Share Average Assets FTE NIM Average Equity $2.65 1.00% 3.19% 10.66% TBV/Share Net Charge-Offs NPLs $8.5M; $24.71; 0.19% 0.24% +10.3% YoY of Total Loans 2025 saw strong growth in EPS, ROA, NIM and TBV Financial information provided in this
Slide 7: 4Q25 and FY2025 Review Highlights
4Q25 and FY2025 Review Highlights Record 4Q25 Net Income of $14.0 million, or $0.85 EPS 2025 Net Income of $44.0 million, or $2.65 EPS 4Q25 and 2025 EPS driven by NIM expansion (loan & deposit repricing), loan growth 4Q25 included no unification-related expenses – project completed 2025 ot
Slide 8: 2025 Reported Results & Key Metrics
2025 Reported Results & Key Metrics 4Q 2025 FY 2025 EPS $0.85 $2.65 FTE Net Interest Margin 3.25% 3.19% Profitability Net Revenue $43.4 million $165.6 million Return on Average Assets (ROA) 1.24% 1.00% Return on Average Equity (ROE) 13.08% 10.66% $3.5 billion of gross loans 87.65% loan-to-deposit ra
Slide 9: Net Interest Margin
Net Interest Margin 3.24% 3.25% 3.25% 3.16% 2.79% 2.85% 3.08% 3.16% 3.24% 3.08% 2.62% 2.69% 5.45% 5.27% 5.30% 5.30% 5.36% 5.43% 5.01% 5.17% 2.85% 2.79% 2.12% 2.12% 2.15% 2.69% 2.06% 1.96% 1.96% 1.95% 1.93% 2.62% 1Q24 2Q24 3Q24 4Q24 1Q25 2Q25 3Q25 4Q25 1Q24 2Q24 3Q24 4Q24 1Q25 2Q25 3Q25 4Q25 NIM Aver
Slide 10: 4Q 2025 Consolidated Financial Statements
4Q 2025 Consolidated Financial Statements UNAUDITED Linked Quarter and Comparative Year Dollars in millions, except per share data Fav/(Unfav) Fav/(Unfav) Income Statement 4Q25 3Q25 Income Statement 2025 2024 Var1 Var1 Total Interest Income $ 54.6 $ 53.6 1.0 Total Interest Income $ 210.1 $ 195.0 15.
Slide 11: 4Q 2025 Consolidated Financial Statements
4Q 2025 Consolidated Financial Statements Linked Quarter and Prior Year Period UNAUDITED Dollars in millions, except per share data 4Q25 vs 4Q25 vs Balance Sheet 4Q25 3Q25 4Q24 3Q251 4Q241 Cash & Cash Equivalents $ 214.2 $ 397.4 $ 154.5 (183.2) 59.7 Investment Securities 572.8 558.4 570.8 14.4 2.0 L
Slide 12: Non-Interest Income/Expense
Non-Interest Income/Expense
Slide 13: 4Q 2025 Non-Interest Income
4Q 2025 Non-Interest Income Dollars in thousands Three Months Ended December 31, 2025 September 30, 2025 December 31, 2024 Fees for Other Services to Customers $ 2,854 $ 2,857 $ 2,763 Fiduciary Activities/Wealth Management 2,771 2,600 2,615 Insurance Commissions 2,050 1,986 1,848 Other Operating Inc
Slide 14: 2025 Non-Interest Income
2025 Non-Interest Income Dollars in thousands Year Ended December 31, 2025 December 31, 2024 Fees for Other Services to Customers $ 11,098 $ 10,892 Fiduciary Activities/Wealth Management 10,304 9,952 Insurance Commissions 7,666 7,147 Other Operating Income 3,364 83 Total Non-Interest Income $ 32,432
Slide 15: 4Q 2025 Non-Interest Expense
4Q 2025 Non-Interest Expense Dollars in thousands Three Months Ended December 31, 2025 September 30, 2025 December 31, 2024 Compensation & Benefits $ 14,309 $ 14,339 $ 13,332 Occupancy & Equipment 1,881 1,907 1,870 Data Processing & Technology 5,152 4,963 5,119 Advertising & Contributions 681 438 57
Slide 16: 2025 Non-Interest Expense
2025 Non-Interest Expense Dollars in thousands Twelve Months Ended December 31, 2025 December 31, 2024 Salaries and Employee Benefits $ 56,289 $ 52,707 Occupancy Expenses 7,762 7,169 Technology and Equipment 20,791 19,365 Advertising & Contributions 1,914 1,365 Legal & Professional 5,524 5,816 FDIC
Slide 17: Operating Expenses — Efficiency Trends
Operating Expenses — Efficiency Trends 68.8% 67.7% 66.5% 63.4% 59.6% 59.0% 2023 2024 1Q 2025 2Q 2025 3Q 2025 4Q 2025 Operating efficiency trends on the right track Generating positive core operating leverage Ongoing expense reviews/initiatives Non-core items in rear-view mirror (unification)
Slide 18: Loans
Loans ~ =\rRow Financial Corporation
Slide 19: Loans
Loans Loan Portfolio ~ $3.45 billion • Portfolio exit rates2 increased 16bps from 4Q24 As of December 31, 2025 • Average origination rate exceeded portfolio exit rate in 4Q25 Commercial (C&I)1 • YTD loan growth ~$73M, or 2.1%, excluding $15M reduction due to 11.4% 1Q credit event3 Residential Commer
Slide 20: Loan Portfolios – Key Attributes as of 12/31/25
Loan Portfolios – Key Attributes as of 12/31/25 Consumer CRE and C&I • Auto loans sourced through a network of >510 dealers in NY • CRE concentration ratio of ~130% of risk-based capital and VT with customers extending beyond those states • CRE excludes owner-occupied real estate loans • Loans are u
Slide 21: Deposits/Funding Sources
Deposits/Funding Sources ~ =\RROW Financial Corporation
Slide 22: Deposit Balances – Excl. Brokered CDs
Deposit Balances – Excl. Brokered CDs Dollars in billions Non-Municipal Municipal Business $3.50 $3.51 $3.56 $3.67 $3.63 $3.80 $3.64 48.7% 49.5% 49.3% 48.4% 49.0% 46.8% 49.2% 24.3% 23.3% 22.7% 25.2% 23.6% 25.3% 21.6% 27.0% 27.2% 28.0% 26.4% 27.4% 27.9% 29.2% 4Q 2022 4Q 2023 4Q 2024 1Q 2025 2Q 2025 3
Slide 23: Deposit Balances – Excl. Brokered CDs
Deposit Balances – Excl. Brokered CDs Dollars in billions Time Deposits Savings Deposits Interest-Bearing Checking Deposit Balances Noninterest-Bearing $3.50 $3.51 $3.56 $3.67 $3.63 $3.80 $3.64 6.0% 13.9% 14.7% 14.0% 14.4% 13.8% 13.7% 41.6% 41.8% 41.8% 40.9% 40.2% 42.8% 42.7% 28.5% 22.8% 22.8% 25.2%
Slide 24: 4Q 2025 Funding Sources and Exit Rates
4Q 2025 Funding Sources and Exit Rates As of December 31, 2025 Dollars in millions Consumer Business Municipal Total Balance Rate Balance Rate Balance Rate Balance Rate Demand (Non-Interest Bearing) $ 309 0.00% $ 421 0.00% $ (8) 0.00% $ 722 0.00% Interest Bearing Checking 321 0.09% 309 2.87% 232 0.2
Slide 25: Retail Deposit Analysis
Retail Deposit Analysis 4Q vs 3Q Dollars in millions 4Q 2025 3Q 2025 Variance Balance Exit Rate Balance Exit Rate Balance Exit Rate Demand (Non-Interest Bearing) $722 0.00% $771 0.00% -$49 0.00% Interest Bearing Checking $862 1.13% $978 1.04% -$116 0.09% Savings and Money Market $1,558 2.11% $1,526
Slide 26: Credit Quality
Credit Quality ~ =\RROW Financial Corporation
Slide 27: Credit Quality
Credit Quality Dollars in millions Non-Performing Loans (NPL) / Gross Loans 0.66% 0.64% 0.66% 0.62% 0.56% 0.24% 0.19% 0.18% 1Q24 2Q24 3Q24 4Q24 1Q25 2Q25 3Q25 4Q25 $21.4 $21.1 $21.9 $21.0 $19.0 $6.4 $6.3 $8.5 2025 annualized charge-offs were 19bps 4Q25 annualized charge-offs were 8bps Allowanc
Slide 28: Delinquent Loan Trends
Delinquent Loan Trends Delinquent Loans to Total Loans – Excl. $15M CRE Loan Participation 0.84% 0.76% 0.68% 0.69% 0.62% 0.61% 0.60% 0.60% 0.58% 0.57% 0.58% 0.56% 0.51% 0.53% 0.45% 0.43% 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 1Q25 2Q25 3Q25 4Q25 Seasonal (4Q) fluctuation Del
Slide 29: Allowance for Credit Losses
Allowance for Credit Losses 2025 Allowance for Credit Loss Walk Dollars in thousands Provision for Credit Losses $7.3M $724 $34,322 $33,598 $6,550 ($6,550) 4Q 2024 Net Charge-Offs Net Charge-Offs Loan Growth & 4Q 2025 Model Calculation In 2Q25, new Loss Drivers implemented for CECL model – resulti
Slide 30: Investments
Investments ~ =\RROW Financial Corporation
Slide 31: Investment Portfolio – AFS and HTM
Investment Portfolio – AFS and HTM Dollars in thousands December 31, 2025 Wtd Avg Expected Current Book Unrealized Category Market Value Book Yield Remaining Life Duration Run-Off by Value Gain / (Loss)1 1 EOY 2026 US Treasuries $ 78,436 $ 80,563 $ 2,127 4.39% 4.44 3.94 $ 0 US Agencies 25,000 24,816
Slide 32: Capital Actions and Ownership
Capital Actions and Ownership
Slide 33: Capital & Ownership
Capital & Ownership • Declared 1Q26 Dividend of $0.30 per share; 49th consecutive quarter of dividends • 2025 Share Repurchase Activity • ~$9.9M of stock repurchases • ~377.5K shares at an average price of $26.32 • $5.1 million remaining under current repurchase authorization • Stock Ownership as of
Slide 34: Fully Diluted Tangible Book Value (TBV)
Fully Diluted Tangible Book Value (TBV) 2025 TBV / Share Walk $2.65 $0.87 $24.71 ($0.07) ($1.14) $22.40 4Q 2024 Net Income Dividends AOCI Stock Repurchases 4Q 2025 TBV growth driven by strong earnings and improved AOCI marks 34
Slide 35: Capital Position
Capital Position Capital Ratios – Arrow Financial Corporation1 Tangible Common Equity 2 8.60% 9.19% 8.00% Total Risk-Based Capital 14.86% 14.86% 6.00% Tier 1 Risk-Based Capital 13.71% 13.74% 4.50% Common Equity Tier 1 Capital 13.07% 13.10% 4.00% Tier 1 Leverage Ratio 9.66% 9.68% 0% 1% 2% 3% 4% 5% 6%
Slide 36: Capital Position
Capital Position Capital Ratios – Arrow Bank1 8.00% Total Risk-Based Capital 14.31% 14.37% 6.00% Tier 1 Risk-Based Capital 13.16% 13.24% 4.50% Common Equity Tier 1 Capital 13.16% 13.23% 4.00% Tier 1 Leverage Ratio 9.24% 9.26% 0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 15% 16% Minimum Regulato
Slide 37: Overview and History
y “al Overview and History ~ =\RROW Financial Corporation
Slide 38: Financial Snapshot
Financial Snapshot Dollars in thousands, except per share amounts 2019 2020 2021 2022 2023 2024 2025 Total assets $3,184,275 $3,688,636 $4,027,952 $3,969,509 $4,169,868 $4,306,348 $4,445,862 Loans $2,386,120 $2,595,030 $2,667,941 $2,983,207 $3,212,908 $3,394,541 $3,453,093 Loan-to-deposit ratio 91.2
Slide 39: Our Profile
Our Profile • Bank holding company • Arrow Bank National Association • Upstate Agency, LLC • Wealth Management Services • $4.4 billion in assets • ~600 employees • Primary service area population of more than 1.1 million 38 Bank Branches 9 Insurance Offices 39
Slide 40: Our History
Our History 1851 Glens Falls Bank opened for business in a newly constructed building on Ridge Street 1932 Changed name to Glens Falls National Bank and Trust Company 1949 Broke ground at 250 Glen Street — our current headquarters 1981 Glens Falls National Bank went public on NASDAQ as GFAL 1983 For
Slide 41: Our History
Our History 1988 Formed Saratoga National Bank and Trust Company 1999 Surpassed $1 billion in assets 2001 Added to the Russell 2000 Index 2004 Bought first insurance agency 2012 Reached $2 billion in assets 2018 Consolidated our insurance business into the Upstate Agency brand 2021 Topped $4 billion
Slide 42: President and Chief Executive Officer
President and Chief Executive Officer David S. DeMarco, President and CEO Mr. DeMarco joined the Company in 1987 as a commercial lender and since that time has served in positions of increasing responsibility within the organization. In 2012, he was named President and CEO of Saratoga National Bank,
Slide 43: Experienced Leadership Team
Experienced Leadership Team Penko Ivanov, Andrew J. Wise, Marc Yrsha, Senior Executive Vice President, Senior Executive Vice President, Senior Executive Vice President, Chief Financial Officer, Treasurer and Chief Risk Officer Chief Banking Officer Chief Accounting Officer Mr. Ivanov joined the Comp
Slide 44: Experienced Leadership Team
Experienced Leadership Team Michael Jacobs, Brooke Pancoe, Executive Vice President, Executive Vice President, Chief Information Officer Chief Human Resources Officer Mr. Jacobs joined the Company in 2003 Ms. Pancoe joined the Company in 2018 as Information Systems Manager. He as Director of Human R
Slide 45: Appendix
Appendix ~ =\RROW Financial Corporation
Slide 46: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Net Interest Margin is the ratio of annualized tax-equivalent net interest income to average earning assets. This is also a non-GAAP financial measure, which Arrow believes provides investors with information that is useful in understanding its financial
Slide 47: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Tangible Book Value, Tangible Equity, and Return on Tangible Equity exclude goodwill and other intangible assets, net from total equity. These are non-GAAP financial measures, which Arrow believes provide investors with information that is useful in unde
Slide 48: Thank you!
Thank you! ~ =\RROW Financial Corporation