GlobeNewswire Inc | Jul 26, 2021 04:15PM EDT

July 26, 2021

NORWICH, N.Y., July 26, 2021 (GLOBE NEWSWIRE) -- NBT Bancorp Inc. (NBT or the Company) (NASDAQ: NBTB) reported net income and diluted earnings per share for the three and six months ended June 30, 2021.

Net income for the three months ended June 30, 2021 was $40.3 million, or $0.92 per diluted common share. Net income increased $15.6 million from the second quarter of 2020 primarily due to the estimated impact of the COVID-19 pandemic on expected credit losses in 2020, which resulted in a second quarter 2020 provision for loan losses of $18.8 million. Net income increased $0.5 million from the previous quarter primarily due to lower provision for loan losses and higher noninterest income, partly offset by higher noninterest expense.

Pre-provision net revenue (PPNR)1 for the second quarter of 2021 was $49.0 million compared to $47.5 million in the previous quarter and $50.7 million in the second quarter of 2020.

CEO Comments

Through the first half of 2021 momentum at NBT has continued to build, said NBT President and CEO John H. Watt, Jr. Our team has driven growth with increases in total loans and pivoted quickly from supporting our customers and communities through the worst of the pandemic and the reopening of our markets to full-on execution of our strategic growth plans. We continue to prioritize our disciplined approach to the allocation of capital, including the advancement of our New England expansion with our first full-service locations in Connecticut opening in the second quarter. Our continued strong capital generation and our commitment to enhancing long-term shareholder value resulted in our decision to increase our quarterly dividend to $0.28 per share, a 3.7% increase.

Second Quarter Financial Highlights

# Net income of $40.3 millionNet Income # Diluted earnings per share of $0.92

# Net interest income on a fully taxable equivalent basis wasNet $79.5 million^1Interest # Net interest margin (?NIM?) on a fully taxable equivalent basisIncome / was 3.00%^1, down 17 basis points (?bps?) from the priorNIM quarter

# PPNR^1 was $49.0 million compared to $47.5 million in the firstPPNR quarter of 2021 and $50.7 million in the second quarter of 2020

# Period end loans were $7.5 billion, up 1%, annualized, from December 31, 2020 # Excluding $360 million of Paycheck Protection Program (?PPP?) loans at June 30, 2021, period end loans increased $61 million or 0.9% from March 31, 2021Loans and # Allowance for loan losses to total loans of 1.31% (1.38%Credit excluding PPP loans and related allowance), down 7 bps from theQuality first quarter 2021 (down 10 bps excluding PPP loans and related allowance) # Net charge-offs to average loans was 0.07%, annualized (0.07% excluding PPP loans) # Nonperforming assets to total assets was 0.38% (0.39% excluding PPP loans)

# Tangible book value per share^2 grew 4% for the quarter and 10%Capital from prior year to $21.50 at June 30, 2021 # Tangible equity to assets of 8.28%^1 # CET1 ratio of 12.12%; Leverage ratio of 9.40%

Loans

-- Period end total loans were $7.5 billion at June 30, 2021 and at December 31, 2020. -- Excluding PPP loans, period end loans increased $60.9 million from March 31, 2021. Commercial and industrial loans increased $12.4 million to $1.5 billion; commercial real estate loans increased $23.5 million to $2.3 billion; and total consumer loans increased $25.0 million to $3.4 billion. -- Total PPP loans as of June 30, 2021 were $360 million (net of unamortized fees). The following activity occurred during the second quarter of 2021: $37 million in originations$232.3 million of loans forgiven$4.7 million of interest and fees recognized into interest income -- Commercial line of credit utilization rate was 22% at June 30, 2021 consistent with 22% at March 31, 2021 and compared to 26% at June 30, 2020.

Deposits

-- Average total deposits in the second quarter of 2021 were $9.9 billion, compared to $9.3 billion in the first quarter of 2021, driven by increases in non-interest bearing demand deposit accounts, money market deposit accounts and savings deposit accounts. -- Loan to deposit ratio was 76.8% at June 30, 2021, compared to 82.6% at December 31, 2020.

Net Interest Income and Net Interest Margin

-- Net interest income for the second quarter of 2021 was $79.2 million, which was consistent with the first quarter of 2021 and down $1.3 million or 1.6% from the second quarter of 2020. -- The NIM on a fully taxable equivalent (FTE) basis for the second quarter of 2021 was 3.00%, down 17 bps from the first quarter of 2021 and down 38 bps from the second quarter of 2020. The net impact of PPP loans and excess liquidity negatively impacted the NIM by 24 bps in the second quarter of 2021 compared to a negative 8 bps impact in the first quarter 2021. Excluding the impact of PPP lending and excess liquidity from each quarter, the NIM decreased 1 bp from the prior quarter primarily due to a 4 bp decline in earning asset yields partially offset by a 3 bp decline in the cost of interest bearing liabilities and a $223 million increase in average checking deposit account balances during the quarter. -- Earning asset yields for the three months ended June 30, 2021 were down 20 bps from the prior quarter and down 50 bps from the same quarter in the prior year. Earning assets grew $490.0 million or 4.8% from the prior quarter and grew $1.0 billion or 10.7% from the same quarter in the prior year. The following are highlights from the prior quarter: Excess liquidity resulted in a $386.7 million increase in the average balances of short-term interest bearing accounts with a yield of 0.09%.The average balance of investment securities increased $103.9 million while yields declined 13 bps.Loan yields decreased 6 bps to 3.96% for the quarter. Excluding PPP loans, yields decreased 1 bp from the prior quarter. -- Total cost of deposits was 0.12% for the second quarter of 2021, down 2 bps from the prior quarter and down 11 bps from the same period in the prior year. -- The cost of interest-bearing liabilities for the three months ended June 30, 2021 was 0.29%, down 5 bps compared to the prior quarter of 0.34% and down 16 bps from the second quarter of 2020 of 0.45%. Cost of interest-bearing deposits decreased 3 bps from the prior quarter and decreased 16 bps from the same quarter in 2020.

Credit Quality and Allowance for Credit Losses

-- Net charge-offs to total average loans of 7 bps (7 bps excluding PPP loans) compared to 12 bps (13 bps excluding PPP loans) in the prior quarter and 28 bps (30 bps excluding PPP loans) in the second quarter of 2020. The decrease in charge-offs during the second quarter of 2021 was primarily due to lower charge-offs in the consumer loan portfolios, which continue to be at lower levels due to the support of government pandemic relief programs. -- Nonperforming assets to total assets was 0.38% (0.39% excluding PPP loans) compared to 0.41% (0.43% excluding PPP loans) at March 31, 2021 and 0.27% (0.28% excluding PPP loans) at June 30, 2020. -- Provision expense for the three months ended June 30, 2021 was a net benefit of $5.2 million and net charge-offs were $1.3 million. The net provision benefit was $2.4 million more than the first quarter of 2021 compared to provision expense of $18.8 million in the second quarter of 2020. The decrease in provision expense from the prior quarter and second quarter of 2020 was primarily due to the reduction in the level of allowance for loan losses resulting from an improved economic forecast and lower levels of charge-offs. -- The allowance for loan losses was $98.5 million or 1.31% (1.38% excluding PPP loans and related allowance) of total loans compared to 1.38% (1.48% excluding PPP loans and related allowance) at March 31, 2021 and 1.49% (1.59% excluding PPP loans and related allowance) at June 30, 2020. The decrease in the level of allowance for credit losses was primarily due to the positive impact the forecasted improving economic conditions had on expected credit losses. -- The reserve for unfunded loan commitments decreased to $5.8 million at June 30, 2021 compared to the prior quarter at $5.9 million.

Noninterest Income

-- Total noninterest income, excluding securities gains (losses), was $39.1 million for the three months ended June 30, 2021, up $2.5 million from the prior quarter and up $4.3 million from the prior year quarter. -- Service charges on deposit accounts were comparable to the prior quarter and higher than the second quarter of 2020. -- ATM and debit card fees were up compared to the prior quarter and the second quarter of 2020 due to increased volume and higher per transaction rates. -- Retirement plan administration fees were lower than the prior quarter driven by seasonal revenue fluctuations, and higher than the second quarter of 2020 driven by market performance and organic growth in relationships. -- Wealth management fees was higher than both the prior quarter and second quarter of 2020 driven by market performance and organic growth. -- Other noninterest income increased slightly from the prior quarter and decreased from the second quarter of 2020 due to lower loan swap fee income and lower mortgage banking income.

Noninterest Expense

-- Total noninterest expense for the second quarter of 2021 was up 5.2% from the previous quarter and up 9.3% from the second quarter of 2020. -- Salaries and benefits increased from the prior quarter and the second quarter of 2020 due to one additional day of payroll in the second quarter, annual merit pay increases and higher medical expenses, partially offset by lower stock-based compensation. -- Occupancy expense is down from the prior quarter due to lower seasonal maintenance and utility expenses and comparable to the second quarter of 2020. -- Data processing and communications decreased from the prior quarter and were higher compared to the second quarter of 2020 driven by continued investments in digital platform solutions including a technology-enabled PPP platform. -- Professional fees and outside services increased from the prior quarter due to timing of initiatives, and were higher compared to the second quarter of 2020 as a result of certain projects paused during the COVID-19 pandemic. -- Equipment expense was higher than both the prior quarter and the second quarter of 2020 due to higher technology costs associated with several digital upgrades. -- Other expenses increased from the prior quarter and the second quarter of 2020 and included $1.9 million in non-recurring costs, including an estimated legal settlement charge.

Income Taxes

-- The effective tax rate was 22.9% for the second quarter of 2021 compared to 21.9% for the first quarter of 2021 and 21.0% for the second quarter of 2020. The increase was due to a higher level of taxable income relative to total income.

Capital

-- Capital ratios remain strong with tangible common equity to tangible assets1 at 8.28%. Tangible book value per share2 grew 4% from the prior quarter and 10% from the prior year quarter to $21.50. -- June 30, 2021 CET1 capital ratio of 12.12%, leverage ratio of 9.40 % and total risk-based capital ratio of 15.78%.

Dividend and Stock Repurchase

-- The Board of Directors approved a third-quarter cash dividend of $0.28 per share at a meeting held today. The dividend, which represents a $0.01, or 3.7% increase, will be paid on September 15, 2021 to shareholders of record as of September 1, 2021. The increased dividend represents a yield of 3.3% based upon the closing price of the Companys stock on July 21, 2021. -- The Company purchased 23,627 shares of common stock during the second quarter of 2021 at a weighted average price of $36.03 excluding commissions. As of June 30, 2021, there were 1,719,342 shares available for repurchase under this plan, which expires on December 31, 2021.

Conference Call and Webcast

The Company will host a conference call at 8:30 a.m. (Eastern) Tuesday, July 27, 2021, to review second quarter 2021 financial results. The audio webcast link, along with the corresponding presentation slides, will be available on the Companys Event Calendar page at https://stockholderinfo.nbtbancorp.com/events-calendar/upcoming-events and will be archived for twelve months.

Corporate Overview

NBT Bancorp Inc. is a financial holding company headquartered in Norwich, NY, with total assets of $11.6 billion at June 30, 2021. The Company primarily operates through NBT Bank, N.A., a full-service community bank, and through two financial services companies. NBT Bank, N.A. has 140 banking locations in New York, Pennsylvania, Vermont, Massachusetts, New Hampshire, Maine and Connecticut. EPIC Retirement Plan Services, based in Rochester, NY, is a full-service retirement plan administration and recordkeeping firm. NBT Insurance Agency, LLC, based in Norwich, NY, is a full-service insurance agency. More information about NBT and its divisions is available online at: www.nbtbancorp.com, www.nbtbank.com, www.epicrps.com and www.nbtinsurance.com.

Forward-Looking Statements

This news release contains forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. These statements may be identified by the use of phrases such as anticipate, believe, expect, forecasts, projects, will, can, would, should, could, may, or other similar terms. There are a number of factors, many of which are beyond the Companys control that could cause actual results to differ materially from those contemplated by 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) local, regional, national and international economic conditions and the impact they may have on the Company and its customers and the Companys assessment of that impact; (2) changes in the level of nonperforming assets and charge-offs; (3) changes in estimates of future reserve requirements based upon the periodic review thereof under relevant regulatory and accounting requirements; (4) the effects of and changes in trade and monetary and fiscal policies and laws, including the interest rate policies of the Federal Reserve Board (FRB); (5) inflation, interest rate, securities market and monetary fluctuations; (6) political instability; (7) acts of war or terrorism; (8) the timely development and acceptance of new products and services and perceived overall value of these products and services by users; (9) changes in consumer spending, borrowings and savings habits; (10) changes in the financial performance and/or condition of the Companys borrowers; (11) technological changes; (12) acquisitions and integration of acquired businesses; (13) the ability to increase market share and control expenses; (14) changes in the competitive environment among financial holding companies; (15) the effect of changes in laws and regulations (including laws and regulations concerning taxes, banking, securities and insurance) with which the Company and its subsidiaries must comply, including those under the Dodd-Frank Act, Economic Growth, Regulatory Relief, Consumer Protection Act of 2018, Coronavirus Aid, Relief and Economic Security Act (CARES Act), and other legislative and regulatory responses to the coronavirus (COVID-19) pandemic; (16) the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board (FASB) and other accounting standard setters; (17) changes in the Companys organization, compensation and benefit plans; (18) the costs and effects of legal and regulatory developments including the resolution of legal proceedings or regulatory or other governmental inquiries and the results of regulatory examinations or reviews; (19) greater than expected costs or difficulties related to the integration of new products and lines of business; (20) the adverse impact on the U.S. economy, including the markets in which we operate, of the novel coronavirus, which causes COVID-19 global pandemic; and (21) the Companys success at managing the risks involved in the foregoing items.

Currently, one of the most significant factors that could cause actual outcomes to differ materially from the Companys forward-looking statements is the potential adverse effect of the current COVID-19 pandemic on the financial condition, results of operations, cash flows and performance of the Company, its customers and the global economy and financial markets. The extent to which the COVID-19 pandemic impacts the Company will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic and its impact on the Companys customers and demand for financial services, the actions governments, businesses and individuals take in response to the pandemic, the impact of the COVID-19 pandemic and actions taken in response to the pandemic on global and regional economies, national and local economic activity, and the pace of recovery when the COVID-19 pandemic subsides, among others. Moreover, investors are cautioned to interpret many of the risks identified under the section entitled Risk Factors in our Form 10-K for the year ended December 31, 2020 as being heightened as a result of the ongoing and numerous adverse impacts of the COVID-19 pandemic. The Company cautions readers not place undue reliance on any forward-looking statements, which speak only as of the date made, and advises readers that various factors including, but not limited to, those described above and other factors discussed in the Companys annual and quarterly reports previously filed with the SEC, could affect the Companys financial performance and could cause the Companys actual results or circumstances for future periods to differ materially from those anticipated or projected. Unless required by law, the Company does not undertake, and specifically disclaims any obligations to, publicly release any revisions that may be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.

Non-GAAP Measures

This press release contains financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (GAAP). Where non-GAAP disclosures are used in this press release, the comparable GAAP measure, as well as a reconciliation to the comparable GAAP measure, is provided in the accompanying tables. Management believes that these non-GAAP measures provide useful information that is important to an understanding of the results of the Companys core business as well as provide information standard in the financial institution industry. Non-GAAP measures should not be considered a substitute for financial measures determined in accordance with GAAP and investors should consider the Companys performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Amounts previously reported in the consolidated financial statements are reclassified whenever necessary to conform to current period presentation.

Contact: John H. Watt, Jr., President and CEO Scott A. Kingsley, Executive Vice President and CFO NBT Bancorp Inc. 52 South Broad Street Norwich, NY 13815 607-337-6589

NBT Bancorp Inc. and SubsidiariesSelected Financial Data(unaudited, dollars in thousands except per share data) 2021 2020 2nd Q 1st Q 4th Q 3rd Q 2nd QProfitability: Dilutedearnings per $ 0.92 $ 0.91 $ 0.78 $ 0.80 $ 0.56 shareWeightedaveragediluted common 43,792,940 43,889,889 43,973,971 43,941,953 43,928,344 sharesoutstandingReturn onaverage assets 1.39 % 1.46 % 1.24 % 1.29 % 0.94 %^3Return onaverage equity 13.42 % 13.57 % 11.59 % 12.09 % 8.76 %^3Return onaveragetangible 17.93 % 18.24 % 15.71 % 16.51 % 12.14 %common equity^1 3Net interest 3.00 % 3.17 % 3.20 % 3.17 % 3.38 %margin^1 3 6 Months Ended June 30, 2021 2020 Profitability: Dilutedearnings per $ 1.83 $ 0.80 shareWeightedaveragediluted common 43,839,060 44,026,420 sharesoutstandingReturn onaverage assets 1.42 % 0.69 % ^3Return onaverage equity 13.49 % 6.23 % ^3Return onaveragetangible 18.08 % 8.69 % common equity^1 3Net interest 3.08 % 3.45 % margin^1 ^3 2021 2020 2nd Q 1st Q 4th Q 3rd Q 2nd QBalance sheet data:Short-terminterest $ 883,758 $ 972,195 $ 512,686 $ 450,291 $ 528,228 bearingaccountsSecuritiesavailable for 1,534,733 1,387,028 1,348,698 1,197,925 1,108,443 saleSecuritiesheld to 622,351 592,999 616,560 663,088 599,164 maturityNet loans 7,419,127 7,528,459 7,388,885 7,446,143 7,514,491 Total assets 11,574,947 11,537,253 10,932,906 10,850,212 10,847,184 Total deposits 9,785,257 9,815,930 9,081,692 8,958,183 8,815,891 Total 304,110 308,766 406,731 446,737 602,988 borrowingsTotal 10,349,891 10,346,272 9,745,288 9,684,101 9,704,532 liabilitiesStockholders' 1,225,056 1,190,981 1,187,618 1,166,111 1,142,652 equity Capital: Equity to 10.58 % 10.32 % 10.86 % 10.75 % 10.53 %assetsTangible 8.28 % 8.00 % 8.41 % 8.27 % 8.04 %equity ratio^1Book value per $ 28.19 $ 27.43 $ 27.22 $ 26.74 $ 26.20 shareTangible bookvalue per $ 21.50 $ 20.71 $ 20.52 $ 20.02 $ 19.46 share^2Leverage ratio 9.40 % 9.60 % 9.56 % 9.48 % 9.44 %Common equitytier 1 capital 12.12 % 12.13 % 11.84 % 11.63 % 11.34 %ratioTier 1 capital 13.34 % 13.38 % 13.09 % 12.88 % 12.60 %ratioTotalrisk-based 15.78 % 15.92 % 15.62 % 15.43 % 15.15 %capital ratioCommon stockprice (end of $ 35.97 $ 39.90 $ 32.10 $ 26.82 $ 30.06 period)



NBT Bancorp Inc. and SubsidiariesAsset Quality and Consolidated Loan Balances(unaudited, dollars in thousands) 2021 2020 2nd Q 1st Q 4th Q 3rd Q 2nd QAsset quality:Nonaccrual $ 40,550 $ 43,399 $ 44,647 $ 35,896 $ 25,567 loans90 days pastdue and still 2,575 2,155 3,149 2,579 2,057 accruingTotalnonperforming 43,125 45,554 47,796 38,475 27,624 loansOther real 798 1,318 1,458 1,605 1,783 estate ownedTotalnonperforming 43,923 46,872 49,254 40,080 29,407 assetsAllowance for 98,500 105,000 110,000 114,500 113,500 loan losses Asset qualityratios (total):Allowance forloan losses 1.31 % 1.38 % 1.47 % 1.51 % 1.49 %to totalloansTotalnonperforming 0.57 % 0.60 % 0.64 % 0.51 % 0.36 %loans tototal loansTotalnonperforming 0.38 % 0.41 % 0.45 % 0.37 % 0.27 %assets tototal assetsAllowance forloan lossesto total 228.41 % 230.50 % 230.14 % 297.60 % 410.87 %nonperformingloansPast dueloans to 0.26 % 0.22 % 0.37 % 0.26 % 0.30 %total loans^4Netcharge-offs 0.07 % 0.12 % 0.21 % 0.12 % 0.28 %to averageloans^3 Asset quality ratios(excluding paycheck protection program):Allowance forloan losses 1.38 % 1.48 % 1.56 % 1.62 % 1.59 %to totalloansTotalnonperforming 0.60 % 0.64 % 0.68 % 0.55 % 0.39 %loans tototal loansTotalnonperforming 0.39 % 0.43 % 0.47 % 0.39 % 0.28 %assets tototal assetsAllowance forloan lossesto total 228.36 % 230.44 % 230.10 % 297.53 % 410.78 %nonperformingloansPast dueloans to 0.27 % 0.23 % 0.39 % 0.28 % 0.32 %total loans^4Netcharge-offs 0.07 % 0.13 % 0.22 % 0.13 % 0.30 %to averageloans^3 2021 2020 2nd Q 1st Q 4th Q 3rd Q 2nd QAllowance for loan losses asa percentage of loans by segment:Commercial & 1.11% 1.20% 1.34% 1.34% 1.25%industrialCommercial 1.26% 1.48% 1.49% 1.57% 1.56%real estatePaycheckprotection 0.01% 0.01% 0.01% 0.01% 0.01%programResidential 0.98% 1.03% 1.07% 1.21% 1.13%real estateAuto 0.76% 0.78% 0.93% 0.92% 0.99%Other 4.27% 4.34% 4.55% 4.66% 5.01%consumerTotal 1.31% 1.38% 1.47% 1.51% 1.49%Totalexcluding PPP 1.38% 1.48% 1.56% 1.62% 1.59%loans 2021 2020 Loans by line 2nd Q 1st Q 4th Q 3rd Q 2nd Qof business:Commercial $ 1,479,258 $ 1,466,841 $ 1,451,560 $ 1,458,053 $ 1,474,736 Commercial 2,265,754 2,242,289 2,196,477 2,121,198 2,100,650 real estatePaycheckprotection 359,738 536,494 430,810 514,558 510,097 programResidentialreal estate 1,512,354 1,478,216 1,466,662 1,448,530 1,460,058 mortgagesIndirect auto 899,324 913,083 931,286 989,369 1,091,889 Specialty 602,585 577,509 579,644 566,973 515,618 lendingHome equity 351,469 369,633 387,974 404,346 415,528 Other 47,145 49,394 54,472 57,616 59,415 consumerTotal loans $ 7,517,627 $ 7,633,459 $ 7,498,885 $ 7,560,643 $ 7,627,991 PPPunamortized $ 12.6 $ 14.2 $ 6.9 $ 11.3 $ 14.6 fees (dollarsin millions)

NBT Bancorp Inc. and SubsidiariesConsolidated Balance Sheets(unaudited, dollars in thousands) June 30, December 31,Assets 2021 2020Cash and due from banks $ 183,185 $ 159,995Short-term interest bearing accounts 883,758 512,686Equity securities, at fair value 32,806 30,737Securities available for sale, at fair value 1,534,733 1,348,698Securities held to maturity (fair value $632,954 622,351 616,560and $636,827, respectively)Federal Reserve and Federal Home Loan Bank stock 25,132 27,353Loans held for sale 1,404 1,119Loans 7,517,627 7,498,885Less allowance for loan losses 98,500 110,000Net loans $ 7,419,127 $ 7,388,885Premises and equipment, net 72,482 74,206Goodwill 280,541 280,541Intangible assets, net 10,241 11,735Bank owned life insurance 226,507 186,434Other assets 282,680 293,957Total assets $ 11,574,947 $ 10,932,906 Liabilities and stockholders' equity Demand (noninterest bearing) $ 3,582,705 $ 3,241,123Savings, NOW and money market 5,633,523 5,207,090Time 569,029 633,479Total deposits $ 9,785,257 $ 9,081,692Short-term borrowings 90,598 168,386Long-term debt 14,045 39,097Subordinated debt, net 98,271 98,052Junior subordinated debt 101,196 101,196Other liabilities 260,524 256,865Total liabilities $ 10,349,891 $ 9,745,288 Total stockholders' equity $ 1,225,056 $ 1,187,618 Total liabilities and stockholders' equity $ 11,574,947 $ 10,932,906

NBT Bancorp Inc. and SubsidiariesConsolidated Statements of Income(unaudited, dollars in thousands except per share data) Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 Interest, fee and dividend incomeInterest and fees on loans $ 74,795 $ 77,270 $ 149,888 $ 155,998 Securities available for 5,762 5,600 11,306 11,353 saleSecurities held to maturity 3,096 3,926 6,478 8,017 Other 391 650 682 1,479 Total interest, fee and $ 84,044 $ 87,446 $ 168,354 $ 176,847 dividend incomeInterest expense Deposits $ 2,862 $ 4,812 $ 6,034 $ 13,916 Short-term borrowings 32 972 102 2,769 Long-term debt 88 393 212 786 Subordinated debt 1,359 128 2,718 128 Junior subordinated debt 525 695 1,055 1,621 Total interest expense $ 4,866 $ 7,000 $ 10,121 $ 19,220 Net interest income $ 79,178 $ 80,446 $ 158,233 $ 157,627 Provision for loan losses (5,216 ) 18,840 (8,012 ) 48,480 Net interest income after $ 84,394 $ 61,606 $ 166,245 $ 109,147 provision for loan lossesNoninterest income Service charges on deposit $ 3,028 $ 2,529 $ 6,055 $ 6,526 accountsATM and debit card fees 8,309 6,136 15,171 11,990 Retirement plan 9,779 9,214 19,877 17,155 administration feesWealth management fees 8,406 6,823 16,316 14,096 Insurance services 3,508 3,292 6,969 7,561 Bank owned life insurance 1,659 1,381 3,040 2,755 incomeNet securities gains 201 180 668 (632 )(losses)Other 4,426 5,456 8,258 10,983 Total noninterest income $ 39,316 $ 35,011 $ 76,354 $ 70,434 Noninterest expense Salaries and employee $ 42,671 $ 39,717 $ 84,272 $ 80,467 benefitsOccupancy 5,291 5,065 11,164 11,060 Data processing and 4,427 4,079 9,158 8,312 communicationsProfessional fees and 4,030 3,403 7,619 7,300 outside servicesEquipment 5,493 4,779 10,670 9,421 Office supplies and postage 1,615 1,455 3,114 3,091 FDIC expense 663 993 1,471 1,304 Advertising 468 322 919 931 Amortization of intangible 682 883 1,494 1,717 assetsLoan collection and other 663 728 1,253 1,745 real estate owned, netOther 5,416 3,916 8,173 10,873 Total noninterest expense $ 71,419 $ 65,340 $ 139,307 $ 136,221 Income before income tax $ 52,291 $ 31,277 $ 103,292 $ 43,360 expenseIncome tax expense 11,995 6,564 23,150 8,279 Net income $ 40,296 $ 24,713 $ 80,142 $ 35,081 Earnings Per Share Basic $ 0.93 $ 0.57 $ 1.84 $ 0.80 Diluted $ 0.92 $ 0.56 $ 1.83 $ 0.80

NBT Bancorp Inc. and SubsidiariesQuarterly Consolidated Statements of Income(unaudited, dollars in thousands except per share data) 2021 2020 2nd Q 1st Q 4th Q 3rd Q 2nd QInterest, fee and dividend incomeInterest and fees on $ 74,795 $ 75,093 $ 76,863 $ 74,998 $ 77,270loansSecurities available 5,762 5,544 5,478 5,603 5,600for saleSecurities held to 3,096 3,382 3,532 3,734 3,926maturityOther 391 291 568 659 650Total interest, fee $ 84,044 $ 84,310 $ 86,441 $ 84,994 $ 87,446and dividend incomeInterest expense Deposits $ 2,862 $ 3,172 $ 3,887 $ 4,267 $ 4,812Short-term 32 70 193 446 972borrowingsLong-term debt 88 124 369 398 393Subordinated debt 1,359 1,359 1,339 1,375 128Junior subordinated 525 530 545 565 695debtTotal interest $ 4,866 $ 5,255 $ 6,333 $ 7,051 $ 7,000expenseNet interest income $ 79,178 $ 79,055 $ 80,108 $ 77,943 $ 80,446Provision for loan (5,216 ) (2,796 ) (607 ) 3,261 18,840lossesNet interest incomeafter provision for $ 84,394 $ 81,851 $ 80,715 $ 74,682 $ 61,606loan lossesNoninterest income Service charges on $ 3,028 $ 3,027 $ 3,588 $ 3,087 $ 2,529deposit accountsATM and debit card 8,309 6,862 6,776 7,194 6,136feesRetirement plan 9,779 10,098 9,011 9,685 9,214administration feesWealth management 8,406 7,910 7,456 7,695 6,823feesInsurance services 3,508 3,461 3,454 3,742 3,292Bank owned life 1,659 1,381 1,733 1,255 1,381insurance incomeNet securities gains 201 467 160 84 180Other 4,426 3,832 5,937 4,985 5,456Total noninterest $ 39,316 $ 37,038 $ 38,115 $ 37,727 $ 35,011incomeNoninterest expense Salaries and $ 42,671 $ 41,601 $ 41,016 $ 40,451 $ 39,717employee benefitsOccupancy 5,291 5,873 5,280 5,294 5,065Data processing and 4,427 4,731 4,157 4,058 4,079communicationsProfessional fees 4,030 3,589 4,388 3,394 3,403and outside servicesEquipment 5,493 5,177 5,395 5,073 4,779Office supplies and 1,615 1,499 1,517 1,530 1,455postageFDIC expense 663 808 739 645 993Advertising 468 451 827 530 322Amortization of 682 812 822 856 883intangible assetsLoan collection andother real estate 663 590 930 620 728owned, netOther 5,416 2,757 10,133 3,857 3,916Total noninterest $ 71,419 $ 67,888 $ 75,204 $ 66,308 $ 65,340expenseIncome before income $ 52,291 $ 51,001 $ 43,626 $ 46,101 $ 31,277tax expenseIncome tax expense 11,995 11,155 9,432 10,988 6,564Net income $ 40,296 $ 39,846 $ 34,194 $ 35,113 $ 24,713Earnings Per Share Basic $ 0.93 $ 0.91 $ 0.78 $ 0.80 $ 0.57Diluted $ 0.92 $ 0.91 $ 0.78 $ 0.80 $ 0.56

NBT Bancorp Inc. and SubsidiariesAverage Quarterly Balance Sheets(unaudited, dollars in thousands) Average Yield Average Yield / Average Yield / Average Yield / Average Yield / Balance / Balance Rates Balance Rates Balance Rates Balance Rates Rates Q2 - 2021 Q1 - 2021 Q4 - 2020 Q3 - 2020 Q2 - 2020Assets Short-terminterest bearing $ 974,034 0.09 % $ 587,358 0.09 % $ 552,529 0.11 % $ 477,946 0.11 % $ 380,260 0.10 %accountsSecuritiesavailable for 1,453,068 1.59 % 1,346,380 1.67 % 1,230,411 1.77 % 1,137,604 1.96 % 985,561 2.29 %sale^1 5Securitiesheld to 604,582 2.23 % 607,407 2.43 % 640,422 2.36 % 621,812 2.56 % 613,899 2.75 %maturity^1 5Investment inFRB and FHLB 25,115 2.67 % 25,606 2.45 % 28,275 5.94 % 29,720 7.08 % 36,604 6.09 %BanksLoans^1 6 7,574,272 3.96 % 7,574,337 4.02 % 7,533,953 4.06 % 7,559,218 3.95 % 7,589,032 4.10 %Totalinterest $ 10,631,071 3.18 % $ 10,141,088 3.38 % $ 9,985,590 3.46 % $ 9,826,300 3.45 % $ 9,605,356 3.68 %earningassetsOther assets 971,681 960,994 954,123 967,194 961,807 Total assets $ 11,602,752 $ 11,102,082 $ 10,939,713 $ 10,793,494 $ 10,567,163 Liabilities and stockholders' equityMoney marketdeposit $ 2,605,767 0.21 % $ 2,484,120 0.23 % $ 2,455,510 0.27 % $ 2,364,606 0.28 % $ 2,360,407 0.29 %accountsNOW deposit 1,454,751 0.05 % 1,358,955 0.05 % 1,315,370 0.05 % 1,207,064 0.05 % 1,167,486 0.04 %accountsSavings 1,660,722 0.05 % 1,547,983 0.05 % 1,465,562 0.05 % 1,447,021 0.05 % 1,383,495 0.05 %depositsTime deposits 591,147 0.75 % 615,343 0.93 % 645,288 1.15 % 684,708 1.31 % 760,803 1.48 %Totalinterest $ 6,312,387 0.18 % $ 6,006,401 0.21 % $ 5,881,730 0.26 % $ 5,703,399 0.30 % $ 5,672,191 0.34 %bearingdepositsShort-term 95,226 0.13 % 115,182 0.25 % 175,597 0.44 % 277,890 0.64 % 427,004 0.92 %borrowingsLong-term 14,053 2.51 % 19,913 2.53 % 59,488 2.47 % 64,137 2.47 % 64,165 2.46 %debtSubordinated 98,204 5.55 % 98,095 5.62 % 97,984 5.44 % 97,934 5.59 % 8,633 5.96 %debt, netJuniorsubordinated 101,196 2.08 % 101,196 2.12 % 101,196 2.14 % 101,196 2.22 % 101,196 2.76 %debtTotalinterest $ 6,621,066 0.29 % $ 6,340,787 0.34 % $ 6,315,995 0.40 % $ 6,244,556 0.45 % $ 6,273,189 0.45 %bearingliabilitiesDemand 3,542,176 3,319,024 3,178,410 3,111,617 2,887,545 depositsOther 235,536 250,991 271,206 282,265 271,635 liabilitiesStockholders' 1,203,974 1,191,280 1,174,102 1,155,056 1,134,794 equityTotalliabilitiesand $ 11,602,752 $ 11,102,082 $ 10,939,713 $ 10,793,494 $ 10,567,163 stockholders'equity Interest rate 2.89 % 3.04 % 3.06 % 3.00 % 3.23 %spreadNet interestmargin (FTE)^ 3.00 % 3.17 % 3.20 % 3.17 % 3.38 %1

NBT Bancorp Inc. and SubsidiariesAverage Year-to-Date Balance Sheets(unaudited, dollars in thousands) Average Yield/ Average Yield/ Balance Interest Rates Balance Interest RatesSix MonthsEnded June 2021 202030,Assets Short-terminterest $ 781,764 $ 360 0.09 % $ 227,478 $ 335 0.30 %bearingaccountsSecuritiesavailable for 1,400,019 11,306 1.63 % 974,044 11,353 2.34 %sale^1 5Securitiesheld to 605,987 7,004 2.33 % 618,149 8,554 2.78 %maturity^1 5Investment inFRB and FHLB 25,359 322 2.56 % 38,194 1,144 6.02 %BanksLoans^1 6 7,574,304 149,963 3.99 % 7,376,072 156,119 4.26 %Totalinterest $ 10,387,433 $ 168,955 3.28 % $ 9,233,937 $ 177,505 3.87 %earningassetsOther assets 966,367 923,689 Total assets $ 11,353,800 $ 10,157,626 Liabilitiesand stockholders'equityMoney marketdeposit $ 2,545,280 $ 2,755 0.22 % $ 2,230,857 $ 6,965 0.63 %accountsNOW deposit 1,407,118 348 0.05 % 1,126,845 404 0.07 %accountsSavings 1,604,664 406 0.05 % 1,329,890 360 0.05 %depositsTime deposits 603,178 2,525 0.84 % 801,896 6,187 1.55 %Totalinterest $ 6,160,240 $ 6,034 0.20 % $ 5,489,488 $ 13,916 0.51 %bearingdepositsShort-term 105,149 102 0.20 % 480,261 2,769 1.16 %borrowingsLong-term 16,967 212 2.52 % 64,179 786 2.46 %debtSubordinated 98,149 2,718 5.58 % 4,316 128 5.96 %debt, netJuniorsubordinated 101,196 1,055 2.10 % 101,196 1,621 3.22 %debtTotalinterest $ 6,481,701 $ 10,121 0.31 % $ 6,139,440 $ 19,220 0.63 %bearingliabilitiesDemand 3,431,216 2,642,926 depositsOther 243,221 243,066 liabilitiesStockholders' 1,197,662 1,132,194 equityTotalliabilitiesand $ 11,353,800 $ 10,157,626 stockholders'equityNet interestincome (FTE)^ $ 158,834 $ 158,285 1Interest rate 2.97 % 3.24 %spreadNet interestmargin (FTE)^ 3.08 % 3.45 %1Taxableequivalent $ 601 $ 658 adjustmentNet interest $ 158,233 $ 157,627 income

^1 The following tables provide the Non-GAAP reconciliations for the Non-GAAP measures contained in this release: Non-GAAP measures (unaudited, dollars in thousands) Pre-provision net revenue 2021 2020 ("PPNR") 2nd Q 1st Q 4th Q 3rd Q 2nd Q Net income $ 40,296 $ 39,846 $ 34,194 $ 35,113 $ 24,713 Income tax 11,995 11,155 9,432 10,988 6,564 expense Provision for (5,216 ) (2,796 ) (607 ) 3,261 18,840 loan losses FTE 299 302 318 325 329 adjustment Net securities (201 ) (467 ) (160 ) (84 ) (180 ) (gains) Provision for unfunded loan (80 ) (500 ) 900 - (200 ) commitments reserve Nonrecurring 1,880 - 4,100 - 650 expense PPNR $ 48,973 $ 47,540 $ 48,177 $ 49,603 $ 50,716 Average $ 11,602,752 $ 11,102,082 $ 10,939,713 $ 10,793,494 $ 10,567,163 Assets Return on Average 1.39 % 1.46 % 1.24 % 1.29 % 0.94 % Assets^3 PPNR Return on Average 1.69 % 1.74 % 1.75 % 1.83 % 1.93 % Assets^3 6 Months Ended June 30, 2021 2020 Net income $ 80,142 $ 35,081 Income tax 23,150 8,279 expense Provision for (8,012 ) 48,480 loan losses FTE 601 658 adjustment Net securities (668 ) 632 (gains) losses Provision for unfunded loan (580 ) 1,800 commitments reserve Nonrecurring 1,880 650 expense PPNR $ 96,513 $ 95,580 Average $ 11,353,800 $ 10,157,626 Assets Return on Average 1.42 % 0.69 % Assets^3 PPNR Return on Average 1.71 % 1.89 % Assets^3 PPNR is a Non-GAAP financial measure that management believes is useful in evaluating the underlying operating results of the Company excluding the volatility in the provision for loan losses, net securities gains (losses) and non-recurring income and/or expense. FTE 2021 2020 Adjustment 2nd Q 1st Q 4th Q 3rd Q 2nd Q Net interest $ 79,178 $ 79,055 $ 80,108 $ 77,943 $ 80,446 income Add: FTE 299 302 318 325 329 adjustment Net interest $ 79,477 $ 79,357 $ 80,426 $ 78,268 $ 80,775 income (FTE) Average earning $ 10,631,071 $ 10,141,088 $ 9,985,590 $ 9,826,300 $ 9,605,356 assets Net interest margin (FTE)^ 3.00 % 3.17 % 3.20 % 3.17 % 3.38 % 3 6 Months Ended June 30, 2021 2020 Net interest $ 158,233 $ 157,627 income Add: FTE 601 658 adjustment Net interest $ 158,834 $ 158,285 income (FTE) Average earning $ 10,387,433 $ 9,233,937 assets Net interest margin (FTE)^ 3.08 % 3.45 % 3 Interest income for tax-exempt securities and loans have been adjusted to a FTE basis using the statutory Federal income tax rate of 21%.

^1 The following tables provide the Non-GAAP reconciliations for the Non-GAAP measures contained in this release: Non-GAAP measures (unaudited, dollars in thousands) Tangible equity to 2021 2020 tangible assets 2nd Q 1st Q 4th Q 3rd Q 2nd Q Total equity $ 1,225,056 $ 1,190,981 $ 1,187,618 $ 1,166,111 $ 1,142,652 Intangible 290,782 291,464 292,276 293,098 293,954 assets Total assets $ 11,574,947 $ 11,537,253 $ 10,932,906 $ 10,850,212 $ 10,847,184 Tangible equity to 8.28 % 8.00 % 8.41 % 8.27 % 8.04 % tangible assets Return on average 2021 2020 tangible common equity 2nd Q 1st Q 4th Q 3rd Q 2nd Q Net income $ 40,296 $ 39,846 $ 34,194 $ 35,113 $ 24,713 Amortization of intangible 512 609 617 642 662 assets (net of tax) Net income, excluding $ 40,808 $ 40,455 $ 34,811 $ 35,755 $ 25,375 intangibles amortization Average stockholders' $ 1,203,974 $ 1,191,280 $ 1,174,102 $ 1,155,056 $ 1,134,794 equity Less: average goodwill and 291,133 291,921 292,725 293,572 294,423 other intangibles Average tangible $ 912,841 $ 899,359 $ 881,377 $ 861,484 $ 840,371 common equity Return on average tangible 17.93 % 18.24 % 15.71 % 16.51 % 12.14 % common equity ^3 6 Months Ended June 30, 2021 2020 Net income $ 80,142 $ 35,081 Amortization of intangible 1,121 1,288 assets (net of tax) Net income, excluding $ 81,263 $ 36,369 intangibles amortization Average stockholders' $ 1,197,662 $ 1,132,194 equity Less: average goodwill and 291,525 290,411 other intangibles Average tangible $ 906,137 $ 841,783 common equity Return on average tangible 18.08 % 8.69 % common equity ^3 ^2 Non-GAAP measure - Stockholders' equity less goodwill and intangible assets divided by common shares outstanding.^3 Annualized. ^4 Total past due loans, defined as loans 30 days or more past due and in an accrual status.^5 Securities are shown at average amortized cost.^6 For purposes of these computations, nonaccrual loans and loans held for sale are included in the average loan balances outstanding.