Tompkins Financial Corporation Reports Second Quarter Earnings
Tompkins Financial Corporation (NYSE American: TMP)
Tompkins Financial Corporation reported net income of $19.4 million for the second quarter of 2019, compared to the $22.1 million reported for the same period in 2018. Year-to-date net income was $40.4 million, a decrease of $2.1 million, or 4.9% from the same period in 2018.
Diluted earnings per share were $1.27 for the second quarter of 2019, compared to $1.43 reported in the second quarter of 2018. For the year-to-date period ended June 30, 2019, diluted earnings per share were $2.63, down 4.7% over the same period in 2018.
President and CEO, Stephen S. Romaine said “Though overall performance remains very good, we did see a decline in earnings for the quarter and year-to-date periods. The decline from recent prior periods was largely driven by the challenging interest rate environment that has resulted in funding costs increasing at a faster pace than asset yields. We are fortunate that our business model includes meaningful fee income contributions from business lines that are less impacted by the interest rate environment. Additionally, we have a number of continuous improvement initiatives underway that we expect will have a positive impact on performance later in 2019 and in future years.”
SELECTED HIGHLIGHTS FOR THE SECOND QUARTER AND YEAR-TO-DATE PERIODS:
- Total loans of $4.9 billion were up 1.4% over the same period in 2018
- Total deposits of $5.0 billion reflect an increase of 4.1% over the same period last year
- Total nonperforming loans were down $2.3 million or 8.8% compared to the same period last year, and down $2.8 million or 10.5% from December 31, 2018
- Tangible book value per share is up $4.75 or 14.8% from the second quarter of 2018 and reflects the sixth consecutive quarterly increase
NET INTEREST INCOME
Net interest income was $52.3 million for the second quarter of 2019, compared to $52.7 million reported for the second quarter of 2018. For the year-to-date period, net interest income was $104.2 million, a decrease of $1.2 million or 1.1% from the same six-month period in 2018.
Net interest income benefited from growth in average loans and higher yielding earning assets. Average loans were up $78.4 million, or 1.7% in the first six months of 2019, compared to the same six month period in 2018, while asset yields were up 26 basis points compared to the first six months of 2018. Average total deposits were up $101.3 million, or 2.1% in the first six months of 2019, versus the same period in 2018. Average noninterest deposits for the first six months of 2019 were in line with the same period in 2018. The average rate paid on interest bearing deposit products in the first six months of 2019 increased 42 basis points over the same period in 2018. The net interest margin for the second quarter of 2019 was 3.34%, compared to 3.36% reported for the same period in 2018, and unchanged compared to the prior quarter end. The decline in margin is largely due to the recent increases in market interest rates that have resulted in increased funding costs.