Community Bank System (CBU) Tops Q1 EPS by 5c

Community Bank System (NYSE: CBU) reported Q1 EPS of $0.81, $0.05 better than the analyst estimate of $0.76.

• First quarter GAAP EPS of $0.80; up $0.02 over first quarter of 2018
• First quarter Operating EPS of $0.81; up $0.03 over the first quarter of 2018
• Net interest margin of 3.80% increased 9 basis points over first quarter of 2018
• Deposit funding costs of 0.20%
• Return on assets of 1.59%
• Return on tangible equity of 17.61%
• Noninterest revenues represent 39.1% of operating revenues
• Announced the acquisition of Kinderhook Bank Corp.

“Our improved first quarter 2019 operating results were driven by a combination of net interest income growth, increased financial servicesrevenue and a continuation of excellent credit quality metrics, “said Mark E. Tryniski, President and Chief Executive Officer. “The strong performance of our core banking business worked to offset a $0.05 reduction in earnings per share related to the Durbin debit interchange price restrictions which became effective for the Company in the third quarter of 2018. Net interest income was up $2.2 million over the first quarter of 2018 and the net interest margin increased nine basis points to 3.80%, reflecting an increase in total loans and the favorable effect of certain loan pre-payment fees, which added four basis points to the net interest margin. Total deposits increased $297.3 million, or 3.6%, in the quarter primarily from significant increases to transaction and savings accounts. In January, we announced a definitive agreement to acquire Kinderhook Bank Corp., parent company of National Union Bank of Kinderhook. This transaction will extend our banking footprint into the attractive Capital District markets which are similar to the other Upstate New York markets in which we are a strong competitor. This investment also complements the financial commitment we made in 2018 when we added an experienced commercial banking team focused on the greater Albany area. We’re pleased with a first quarter performance that’s reflective of consistent and effective execution of our ongoing business strategy.”

For earnings history and earnings-related data on Community Bank System (CBU) click here.

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