Tompkins Financial

Submitted photo and press release:

Tompkins Insurance Agencies is pleased to announce that Nick Mroz has been recently hired as a commercial insurance account executive.

He will serve the Western New York region out of the agency’s Batavia office at 90 Main St. 

Mroz has 17 years of experience in the financial services and Insurance industry. He was formerly employed by Five Star Bank.

Mroz holds his Life & Health and Property & Causality insurance licenses, and FINRA series 6 and 63 securities licenses. 

He attended Pierce Community College in Tacoma, Wash., and served in the Army.

Mroz and his family reside in Medina, where he is a member of the Medina YMCA, American Legion, and VFW.

Press release:

ITHACA -- Tompkins Financial Corporation (NYSE American:TMP), parent company of Tompkins Bank of Castile, Tompkins Insurance Agencies, and Tompkins Financial Advisors, has reported record year-to-date and first quarter earnings.

Tompkins Financial Corporation Reports Cash Dividend

Tompkins Financial Corporation announced today that its Board of Directors approved payment of a regular quarterly cash dividend of $0.52 per share, payable on May 18, 2020, to common shareholders of record on May 11, 2020.

Tompkins Financial Corporation Reports First Quarter Earnings

Tompkins Financial Corporation announced net income attributable to common shareholders of $7.9 million, or $0.53 per diluted common share for the first quarter of 2020, compared to $21.0 million, or $1.37 per diluted common share, for the first quarter of 2019. Results for the first quarter of 2020 were negatively impacted by current economic stress resulting from the COVID-19 pandemic, which contributed to the $16.3 million provision for credit losses recognized during the quarter under the new current expected credit losses (CECL) accounting standard. Refer to "Asset Quality" section for further discussion of the impact on the Company's financial statements upon adoption of this new accounting guidance.

"These are clearly unprecedented times for our country and our communities. I am extremely proud of the exceptional way the Tompkins team has stepped up to the current environment by addressing the specific challenges of our clients and communities who are facing hardships due to the COVID-19 pandemic. Though these are unprecedented times, Tompkins enters this environment well prepared to face the many challenges and difficulties we are all dealing with as a result of the pandemic. Over recent years, we have invested significantly in digital technologies to improve capabilities that allow our customers to bank remotely. We have also invested significantly in our internal systems, which allowed nearly 100 percent of our non-retail employees to transition quickly and securely to remote working environments with limited disruption to our business. Furthermore, we entered 2020 with a strong financial position, coming off a year of record earnings per share in 2019, and with our 2019 Risk Based Capital Ratio at its highest level since 2014."

SELECTED HIGHLIGHTS FOR THE FIRST QUARTER:

Despite the decline in earnings from the prior year, there were several favorable trends noted during the first quarter of 2020, including:

•       Total loans of $4.9 billion were up 3.1 percent over March 31, 2019

•       Total deposits of $5.4 billion increased by 8.4 percent over March 31, 2019

•       Noninterest bearing deposits of $1.4 billion increased by 5.6 percent over March 31, 2019

•       Net interest margin was 3.44 percent for the first quarter of 2020, up from 3.34 percent for the first quarter of 2019, and 3.43 percent for the fourth quarter of 2019

​NET INTEREST INCOME

Net interest margin was 3.44 percent for the first quarter of 2020, up compared to the 3.34 percent reported for the first quarter of 2019, and 3.43 percent for the trailing quarter ended Dec. 31, 2019. The improved net interest margin year-over-year was largely driven by lower other borrowing balances and funding costs, primarily in other borrowings. Net interest income of $53.0 million for the first quarter of 2020 was up 2.0 percent compared to the first quarter of 2019.

NONINTEREST INCOME

Noninterest income represented 26.4 percent of total revenues in the first quarter of 2020, compared to 27.2 percent in the first quarter of 2019. Noninterest income of $19.0 million was down 2.3 percent compared to the same period in 2019. Noninterest income in the first quarter of 2019 included a one-time incentive payment of $500,000 (pre-tax) related to our card services business.

NONINTEREST EXPENSE

Noninterest expense was $45.7 million for the first quarter of 2020, which was up 3.5 percent from the same period in 2019, and in line with the fourth quarter of 2019. The increase in noninterest expense from the same period last year was mainly related to higher salaries and wages in the first quarter of 2020, largely reflective of merit increases awarded in 2019.

 INCOME TAX EXPENSE

The Company's effective tax rate was 19.4 percent in the first quarter of 2020, compared to 21.0 percent for the same period in 2019.

ASSET QUALITY

Asset quality trends remained strong in the first quarter of 2020. Nonperforming assets represented 0.46 percent of total assets at March 31, 2020, down slightly from 0.47 percent at Dec. 31, 2019. Nonperforming asset levels continue to be below the most recent Federal Reserve Board Peer Group Average¹of 0.56 percent.

Net charge-offs for the first quarter of 2020 were $1.2 million compared to $3.5 million reported in the first quarter of 2019. Net charge-offs of $1.2 million in the first quarter of 2020 was largely related to a single credit, while the first quarter of 2019 included a $3.1 million write-down of one credit, both in the commercial real estate portfolio.

The Company adopted Accounting Standards Update (“ASU”) 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“CECL”), effective Jan. 1, 2020. The Company recorded a net increase to retained earnings of $1.7 million upon adoption of the new standard. The transition adjustment at Jan. 1, 2020 included a $2.5 million decrease in the allowance for credit losses on loans, and a $0.4 million increase in the allowance for credit losses on off-balance sheet credit exposures, net of the corresponding $0.4 million decrease in deferred tax assets. The provision for credit losses for the first quarter of 2020 was $16.3 million, increasing the allowance for credit losses to $52.4 million at March 31, 2020. The increase in the first quarter of 2020 was not a direct result of specific credit risks currently identified in the loan portfolio; rather, the increase was largely a result of the impact of the current economic shutdown related to COVID-19 on economic forecasts and other model assumptions relied upon by management in determining the allowance.

The allowance for credit losses represented 1.06 percent of total loans and leases at March 31, 2020, compared to 0.81 percent at Dec. 31, 2019, and 0.84 percent at March 31, 2019. The ratio of the allowance to total nonperforming loans and leases was 170.74 percent at March 31, 2020, compared to 126.90 percent at Dec. 31, 2019, and 175.51 percent at March 31, 2019.

CAPITAL POSITION

Capital ratios remained well above the regulatory minimums for well capitalized institutions. The ratio of Tier 1 capital to average assets was 9.53 percent at March 31, 2020, down slightly from 9.61 percent at December 31, 2019, and improved from 9.24 percent at March 31, 2019. Consistent with the Company's capital planning practices, during the quarter ended March 31, 2020, the Company repurchased 71,288 shares of common stock at an average price of $78.83 per share. On March 19, 2020, following the announcement of the national emergency related to the COVID-19 pandemic, the Company suspended the purchase of shares under the Company’s share repurchase program. During the quarter ended Dec. 31, 2019, the Company repurchased 35,821 shares of common stock at an average price of $80.25 per share. There were no shares repurchased during the first quarter of 2019.

IMPACT OF, AND RESPONSE TO, COVID-19 PANDEMIC

Economic Environment

The COVID-19 outbreak has led to government-mandated closures and stay at home orders across the nation, which have resulted in deteriorating economic conditions throughout the U.S. The various government orders issued in response to the pandemic are significantly impacting the U.S. labor market, consumer spending and business investments. During March 2020, in response to the deteriorating economic conditions, the Federal Reserve reduced the federal funds rate 1.5 percentage points, to .00 to .25 percent. The Federal Reserve also provided a pandemic-related stimulus package estimated at $4.0 trillion, in order to ease the stress on financial markets. In addition, the United States Congress passed the Coronavirus Aid, Relief and Economic Security Act ("CARES Act"), which would provide approximately $2.5 trillion of support to U.S. citizens and businesses affected by COVID-19.

Company Response

During the first quarter of 2020, the Company designated a Pandemic Planning Committee, made up of members of Senior Management, to oversee the Company’s response to COVID-19. The Company implemented a number of risk mitigation measures designed to protect our employees and customers, while maintaining services for our customers and community. These measures included restrictions on business travel and establishment of a remote work environment for all non-customer facing employees. The Company also implemented drive-up only or by appointment only operations across its branch network.

Currently, over 85 percent of our workforce is working remotely and we have imposed social distancing restrictions and provided premium pay for those employees who are required to be on premise to complete essential on-site functions. Due to the significant uncertainty of the current economic climate, and the Company's ongoing response to the pandemic and related shutdowns, annual pay increases for our Company's executive officers (which is comprised of our Senior Leadership Team members) have been deferred indefinitely.

As previously announced, Tompkins has initiated and participated in a number of credit initiatives to support employees and customers who have been impacted by the shutdown associated with the COVID-19 pandemic. For non-executive employees affected by COVID-19, the Company implemented a low interest loan program. The Company also implemented a payment deferral program to assist both consumer and business borrowers that may be experiencing financial hardship due to COVID-19. The current standard program allows for the deferral of loan payments for up to 90 days and customers will be able to request a payment deferral until the middle of May 2020. As of April 20, 2020, the Company had granted payment deferral requests for approximately 2,800 loans to individuals and businesses.

The Company is participating in the U.S. Small Business Administration (SBA) Paycheck Protection Program (“PPP”). This program provides borrower guarantees for lenders, as well as loan forgiveness incentives for borrowers that utilize the loan proceeds to cover employee compensation-related expenses and certain other eligible business operating costs, all in accordance with the rules and regulations established by the SBA. The Company began accepting applications for PPP loans on April 3, 2020, and has approved approximately 2,900 loans totaling about $500 million.

Mr. Romaine added, “We enter the second quarter of 2020 in a period of significant uncertainty surrounding the COVID-19 pandemic and related economic shut-downs. Our long held philosophy of maintaining Tompkins as a sustainable high performing company, supported with prudent risk management practices, is now more important than ever. We believe our healthy capital and liquidity positions will provide flexibility to respond to current challenges. The overall impact of COVID-19 on our consolidated results of operations for the three months ended March 31, 2020 was limited, with the exception of our provision for credit losses. We did see some slowdown toward the end of the first quarter in other areas of our business, including reduced transaction volumes in our card services business, a decrease in wealth management fees due to the decline in financial markets, and decreases in certain other fee related income. However, the extent to which the COVID-19 pandemic will affect our business, results of operation and financial condition going forward is difficult to predict and depends on numerous evolving factors.”

There is currently a great deal of uncertainty regarding the length of the COVID-19 pandemic and the efficacy of the extraordinary measures being put in place to address it. If efforts to contain COVID-19 are not as successful as anticipated, if restrictions on movement last into the third quarter or beyond, or if the federal government's economic stimulus packages are ineffective or delayed, the current economic downturn will likely be much longer and much more severe. The deeper the economic downturn is, and the longer it lasts, the more it will damage consumer fundamentals and sentiment. Similarly, an extended global recession due to COVID-19 would weaken the U.S. recovery and damage business fundamentals. As a result, the pandemic and its consequences, including responsive measures to manage it, have negatively impacted, and may continue to negatively impact, demand for and profitability of our products and services, the valuation of our assets, the ability of borrowers to satisfy obligations, and our ability to meet the needs of our customers, all of which could have a material adverse effect on our business and financial performance.

ABOUT TOMPKINS FINANCIAL CORPORATION

Tompkins Financial Corporation is a financial services company serving the Central, Western, and Hudson Valley regions of New York and the Southeastern region of Pennsylvania. Headquartered in Ithaca, NY, Tompkins Financial is parent to Tompkins Trust Company, Tompkins Bank of Castile, Tompkins Mahopac Bank, Tompkins VIST Bank, Tompkins Insurance Agencies Inc., and offers wealth management services through Tompkins Financial Advisors. For more information on Tompkins Financial, visit www.tompkinsfinancial.com.

Press release:

In an effort to assist its employees with unexpected financial burdens faced during the current COVID-19 crisis, Tompkins Financial is offering a discount loan program to non-executive Tomkins employees who have encountered increased expenses or decreased income. These include spouse or domestic partner’s job loss, and unexpected costs for elder care or child care.

In addition, Tompkins has instituted a premium of up to 25 percent additional pay for employees whose essential work requires them to be on-site.

“Banks have been deemed to provide an essential service to our customers and communities and this is a way we can show our appreciation to our employees,” said John McKenna, president and CEO. “We understand that while we as a company are fortunate enough to maintain our workforce during this time, our team members may have spouses or partners who experience job loss.

"We also appreciate that they may experience unexpected costs related to the pandemic. We want our team members to know that Tompkins is standing by them in the same way they are standing by our customers.”

The premium pay model will apply to both exempt and non-exempt non-executive employees whose work requires them to report to a Tompkins location to perform essential job duties.

About Tompkins Bank of Castile

Tompkins Bank of Castile is a community bank with 15 offices in the six-county Western New York region. Services include complete lines of consumer deposit accounts and loans, business accounts and loans, and leasing. In addition, insurance is offered through an affiliate company, Tompkins Insurance Agencies, Wealth management, trust and investment services are provided through Tompkins Financial Advisors. Further information about the bank is available on its website, www.bankofcastile.com.

Press release:

ITHACA -- Tompkins Financial Corporation (NYSE American:TMP)

Tompkins Financial Corporation announced today that its Board of Directors has authorized a new stock repurchase program of up to 400,000 shares of the company's outstanding common stock, par value $0.10 per share. This program replaces the company's existing 400,000 share repurchase program announced on July 20, 2018.

The new stock repurchase program is expected to be completed over the next 24 months.

The shares may be repurchased from time to time in open market transactions at prevailing market prices, in privately negotiated transactions, or by other means in accordance with federal securities laws. The actual timing, number and value of shares repurchased under the program will be determined by management at its discretion and will depend on a number of factors, including the market price of the Company's stock and general market and economic conditions, and applicable legal requirements.

"Safe Harbor" Statement under the Private Securities Litigation Reform of 1995:

This press release may include forward-looking statements with respect to revenue sources, growth, market risk, and corporate objectives. The Company assumes no duty, and specifically disclaims any obligation, to update forward-looking statements, and cautions that these statements are subject to numerous assumptions, risks, and uncertainties, all of which could change over time. Actual results could differ materially from forward-looking statements.

Press release:

Tompkins Insurance Agencies has received the 2019 Excellence in Social Media Award from the National Association of Professional Insurance Agents (PIA). The award was presented September 20, 2019 at a gala ceremony held in conjunction with PIA’s Board of Directors meeting in Orlando, Fla.

The award honors a PIA member agency that uses nontraditional communication tools to effectively further the goals of the organization. 

“Our goal was to create a social media presence that is professional, credible, interesting, visually pleasing, educational, and tells our story in a compelling way," said David S. Boyce, Tompkins Insurance president and CEO. "This award validates the success of our efforts, and we are proud to be honored in this way."

The 2019 PIA National Excellence in Social Media Award was sponsored by the National Insurance Producer Registry (NIPR).

“One of the first groups to fully embrace social media, a few years ago, was independent insurance agents,” said Lauren G. Pachman, esq., PIA National counsel, director of regulatory affairs and a board member of NIPR. “In fact, PIA National was one of the first groups anywhere to bestow an award for excellence in social media, beginning in 2010.”

“Since that time, we’ve seen an increase in the sophistication—and the positive results—of the use of social media marketing by independent insurance agencies,” Pachman said. “Today, we honor a PIA agency that has taken agency social media marketing to the next level, the winner of the 2019 PIA National Excellence in Social Media Award, Tompkins Insurance Agencies.”

About Tompkins Insurance Agencies Inc.

Founded in 1875, Tompkins Insurance Agencies Inc. is an independent insurance agency offering personal and business insurance and employee benefits services through more than 50 different companies.

The firm operates 17 offices in Western New York, seven offices in southeast Pennsylvania, and six offices in Central New York. A part of Tompkins Financial Corporation, (trading as TMP on the NYSE - MKT), the agency is affiliated with Tompkins Bank of Castile, Tompkins VIST Bank, Tompkins Trust Company, and Tompkins Financial Advisors. Further information is available at www.tompkinsins.com.   

ITHACA -- Tompkins Financial Corporation (NYSE American: TMP) announced today that its Board of Directors approved payment of a regular quarterly cash dividend of 50-cents per share, payable on Aug.15 to common shareholders of record on July 30, 2019.

Tompkins Financial Corporation is a financial services company serving the Central, Western, and Hudson Valley regions of New York and the Southeastern region of Pennsylvania.

Headquartered in Ithaca, Tompkins Financial is parent to Tompkins Trust Company, Tompkins Bank of Castile, Tompkins Mahopac Bank, Tompkins VIST Bank, Tompkins Insurance Agencies Inc., and offers wealth management services through Tompkins Financial Advisors.

For more information on Tompkins Financial, visit www.tompkinsfinancial.com.

Submitted photos and press release:

Louis Atti, CPCU, of Angola, has joined Tompkins Insurance Agencies Inc. as the Personal Insurance manager and a member of the agency’s senior leadership team. He will be working out of the 113 Main St. office in Batavia.

In his new role, Atti (inset photo right) will be responsible foroverseeing the day-to-day operations of the personal insurance service team in the Western New York and Pennsylvania regions.

Atti brings almost 30 years of experience in personal insurance, having been the Personal Insurance manager for the Evans Agency in the Buffalo area. Currently, Atti is the chairman of the Board for Adirondack Insurance and the chairman of the Board for the Big I of NY. He also served as past chairman of the board for the IIAAWNY (Independent Insurance Agents Association of WNY Inc.) and was past mayor/trustee for the Village of Angola.

“I, as well as others here, have a long and deep rooted connection to Lou,” said David Boyce, president and CEO. “We are pleased to bring his level of experience and knowledge to our agency as we continue to grow and improve our customer experience.

"Lou is a unique fit for our agency. Having worked at Evans for the last 20 years, Lou understands and appreciates the benefits of working at an integrated organization which includes banking, wealth management and insurance, and the value we bring our customers.”

Atti earned his bachelor’s degree from the State University of New York at Fredonia and earned his prestigious Chartered Property Casualty Underwriter (CPCU) designation from The Institutes, which identifies him as a property-casualty subject matter expert.

Over the next 90 days, he will transition fully into his new role, replacing Tim Spezzano, (inset photo left) currently senior vice president and personal lines manager, who has accepted the position of sales manager for the agency.

Spezzano will be responsible for the Personal, Commercial and Employee Benefits Sales teams in both New York and Pennsylvania. 

Spezzano has been in the insurance industry for 24 years, and with Tompkins Insurance for the past 18 years, holding positions such as account executive, commercial lines sales manager and claims manager, and serving on the agency’s senior leadership team.

About Tompkins Insurance Agencies

Tompkins Insurance Agencies Inc., operates 17 offices in Western New York, six offices in Central New York and seven offices in Southeast Pennsylvania. A part of Tompkins Financial Corporation (trading as TMP on the NYSE - MKT), the agency is affiliated with Tompkins Bank of Castile, Tompkins Trust Company, Tompkins VIST Bank, Tompkins Mahopac Bank and Tompkins Financial Advisors.

It is an independent insurance agency offering personal and business insurance and employee benefits services through more than 50 of the nation’s leading insurance carriers. Further information is available at www.tompkinsins.com. Tompkins Insurance ranks No. 2 on the Rochester Business Journal’s 2018 list of top Commercial Insurance firms.*

*Source: Rochester Business Journal, Jan. 2019

BATAVIA – Tompkins Financial Corporation has announced the acquisition of Cali Agency Inc. by Tompkins Insurance Agencies Inc., an affiliate of the financial corporation. The acquisition was effective May 1.

“We are happy to continue to grow our business in Warsaw and serve more of our neighbors there through this acquisition,” said David S. Boyce, president and CEO of Tompkins Insurance. “Our roots run deep in Warsaw; we’ve been proudly serving families and businesses there since 1935.”

The change is a win-win for customers, Boyce said.

“In addition to continuing to receive personal attention from local insurance professionals who place a high value on customer service, customers will have 'one stop shopping' access to the comprehensive array of financial solutions offered by our affiliation with Tompkins Bank of Castile and Tompkins Financial Advisors,” Boyce said.

According to Boyce, the Cali Agency location will close and customers will be served from the Tompkins Insurance Warsaw location at 2367 State Route 19 North beginning on May 6.

In the very near future, clients of Cali Agency may also receive service at any of the convenient locations nearby, including offices at 25 State St. in Nunda; 102 N. Center St. in Perry, 14 Market St. in Attica; 11 South St. in Geneseo; through any of the agency’s Western New York locations, or through its Customer Care Center at 888-261-2688.

Tompkins Insurance serves 30,000 personal insurance customers and 7,600 commercial insurance customers, making it the third largest commercial insurance firm in the Rochester/Monroe County area and among the 100 largest agencies in the country. 

About Tompkins Insurance Agencies:

Tompkins Insurance Agencies, Inc., operates 17 offices in Western New York, seven offices in central New York and seven offices in southeast Pennsylvania. A part of Tompkins Financial Corporation, (trading as TMP on the NYSE - MKT), the agency is affiliated with Tompkins Bank of Castile, Tompkins Trust Company, Tompkins VIST Bank, Tompkins Mahopac Bank and Tompkins Financial Advisors. It is an independent insurance agency offering personal and business insurance and employee benefits services through more than 50 of the nation’s leading insurance carriers. Further information is available at www.tompkinsins.com. Tompkins Insurance ranks No. 2 on the Rochester Business Journal’s 2018 list of top Commercial Insurance firms.*

*Source: Rochester Business Journal, January 2019

Press release:

ITHACA -- Tompkins Financial Corporation (NYSE American: TMP), parent company of Tompkins Bank of Castile, Tompkins Insurance Agencies, and Tompkins Financial Advisors, has reported record year-to-date and second quarter earnings.

The company also has announced that its Board of Directors approved payment of a regular quarterly cash dividend, and has authorized a new stock repurchase program.

Tompkins Financial Corporation announced Monday that its Board of Directors approved payment of a regular quarterly cash dividend of $0.50 per share, payable on May 15, 2019, to common shareholders of record on May 7, 2019.

Tompkins Financial Corporation is a financial services company serving the Central, Western, and Hudson Valley regions of New York and the Southeastern region of Pennsylvania.

Headquartered in Ithaca, Tompkins Financial is parent to Tompkins Trust Company, Tompkins Bank of Castile, Tompkins Mahopac Bank, Tompkins VIST Bank, Tompkins Insurance Agencies Inc., and offers wealth management services through Tompkins Financial Advisors. For more information on Tompkins Financial, visit www.tompkinsfinancial.com.

Tompkins Financial Corporation reported net income of $21.0 million for the first quarter of 2019, an increase of 3.0 percent from the $20.4 million reported for the same period in 2018. Diluted earnings per share were $1.37 for the first quarter of 2019, a 3.0 percent increase from $1.33 reported for the first quarter of 2018.

President and CEO Stephen S. Romaine said “We are excited to start 2019 with the best first quarter in our Company's history. Growth in loans and deposits, higher fee income, and improved credit quality all contributed to the improved results in 2019.

"During the quarter we celebrated the grand opening of our office in Amherst. This is our first office in the Buffalo market and provides banking, wealth management and insurance services."

• Tompkins Financial Corporation Reports Record First Quarter Earnings
• Tompkins Financial Corporation Reports Cash Dividend

Selected highlights for first quarter:

•      Diluted earnings per share of $1.37 represent the best first quarter in Company history, and are up 3.0 percent over the same period in 2018

•      Total loans of $4.8 billion were up 1.8 percent over the same period in 2018

•      Total deposits of $5.0 billion reflect an increase of 1.2 percent over the same period last year

•      Total nonperforming loans were down 8.9 percent compared to the same period last year, and down 13.6 percentfrom Dec. 31, 2018

•      Tangible book value per share is up 14.4 percent from the first quarter of 2018 and reflects the fifth consecutive quarterly increase

NET INTEREST INCOME

The net interest margin was 3.34 percent for the first quarter of 2019, flat compared to the fourth quarter of 2018, and is down from 3.42 percent for the first quarter of 2018. The net interest margin in the prior year benefited from reduced interest expense associated with accelerated accretion of purchase accounting related to certain acquired deposits.

Net interest income of $51.9 million for the first quarter of 2019 decreased by 1.5 percent compared to the same period in 2018, and was down 2.5 percent compared to the fourth quarter of 2018. The decrease in net interest income over prior year was mainly due to higher cost on interest-bearing deposits, which was largely driven by the higher market interest rate environment.

NONINTEREST INCOME

Noninterest income represented 27.2 percent of total revenues in the first quarter of 2019, compared to 25.3 percent in the same period in 2018, and 23.9 percent for the most recent prior quarter. Noninterest income of $19.4 million was up 8.8 percent compared to the same period last year, and down 2.3 percent compared to the fourth quarter of 2018. Insurance revenue was the largest contributor to noninterest income and reflected an increase of 8.8 percent over the same period last year. Noninterest income also included a one-time incentive payment of $500,000 (pre-tax) related to our card services business in the first quarter of 2019.

NONINTEREST EXPENSE

Noninterest expense was $44.2 million for the first quarter of 2019, which was up 1.1 percent from the same period in 2018, and down 6.4 percent compared to the fourth quarter of 2018. The increase in noninterest expense from the same period last year was mainly related to higher salaries and wages in the first quarter of 2019. The decline from the most recent prior quarter was primarily due to higher cost in the fourth quarter of 2018 for professional fees, primarily related to investments in strengthening the Company’s compliance and information security infrastructure.

INCOME TAX EXPENSE

The Company’s effective tax rate was 21.0 percent in the first quarter of 2019, compared to 22.0 percent for the same period in 2018.

ASSET QUALITY

Asset quality trends remained strong in the first quarter of 2019. Nonperforming assets represented 0.36 percent of total assets at March 31, 2019, down from 0.42 percent at Dec. 31, 2018. Nonperforming asset levels continue to be below the most recent Federal Reserve Board Peer Group Average¹of 0.59 percent.

Provision for loan and lease losses was $445,000 for the first quarter of 2019, down from $567,000 reported for the first quarter of 2018, and $1.6 million reported for the fourth quarter of 2018. Net charge-offs for the first quarter of 2019 were $3.5 million compared to $127,000 reported in the first quarter of 2018. The first quarter of 2019 included a write-down on one large credit in the commercial real estate portfolio, the credit did have an impairment reserve at Dec. 31, 2018.

The Company’s allowance for originated loan and lease losses totaled $40.2 million at March 31, 2019, and represented 0.89 percent of total originated loans and leases at March 31, 2019, compared to 0.91 percent at March 31, 2018, and 0.95 percent at Dec. 31, 2018. The total allowance coverage of nonperforming loans and leases increased to 175.50 percent at March 31, 2019, up from 159.34 percent at March 31, 2018, and 163.25 percent at Dec. 31, 2018.

CAPITAL POSITION

Capital ratios remain well above the regulatory well capitalized minimums. The ratio of tangible common equity to tangible assets was 8.24 percent at March 31, 2019, improved from the 7.81 percent reported for the most recent prior quarter ended Dec. 31, 2018, and 7.29 percent at March 31, 2018.

About Tompkins Financial Corporation

Tompkins Financial Corporation is a financial services company serving the Central, Western, and Hudson Valley regions of New York and the Southeastern region of Pennsylvania. Tompkins Financial operates in Western New York as Tompkins Bank of Castile, Tompkins Insurance Agencies, and Tompkins Financial Advisors. Further information is available at www.tompkinsfinancial.com. 

Tompkins Bank of Castile is a community bank with 16 offices in the five-county Western New York region. Services include complete lines of consumer deposit accounts and loans, business accounts and loans, and leasing. Further information about the bank is available on its website, www.bankofcastile.com.

Tompkins Insurance Agencies Inc., offers personalized service, local decision-making and a broad range of services for consumers and businesses. It is an independent insurance agency offering personal and business insurance and employee benefits services through more than 50 different companies. The firm operates six offices in central New York, 16 offices in Western New York and seven offices in Southeast Pennsylvania. Further information is available at www.tompkinsins.com.

Tompkins Financial Advisors is the wealth management firm of Tompkins Financial Corporation. With more than a century of experience in helping clients to build, protect, and preserve wealth, Tompkins Financial Advisors provides financial planning, investment management, trust services and estate administration. For more information, visit www.tompkinsfinancialadvisors.com.