NBT Bancorp Q2 Net Income Dips to $38.2M Amidst Asset Growth

TL;DR

**NBTB's Q2 earnings are a red flag, showing profit erosion despite asset growth; expect continued pressure on regional bank margins.**

AI Summary

NBT Bancorp Inc. reported a net income of $38.2 million for the second quarter of 2025, a decrease from $40.5 million in the second quarter of 2024. For the six months ended June 30, 2025, net income was $75.1 million, down from $80.1 million in the same period of 2024. The company's total assets stood at $12.0 billion as of June 30, 2025, a slight increase from $11.9 billion at December 31, 2024. Total liabilities also increased to $10.8 billion from $10.7 billion over the same period. Key business changes include a decrease in retained earnings from $1.03 billion at December 31, 2024, to $1.01 billion at June 30, 2025, reflecting dividend payments and net income. Accumulated other comprehensive income improved from a deficit of $105.1 million at December 31, 2024, to a deficit of $98.7 million at June 30, 2025, indicating some recovery in investment valuations. The strategic outlook remains focused on managing interest rate risks and maintaining asset quality in a challenging economic environment.

Why It Matters

NBT Bancorp's slight dip in net income for Q2 2025, despite asset growth, signals potential margin compression or increased operational costs, which could impact investor returns. For employees, stable asset growth suggests job security, but declining profitability might temper future compensation increases. Customers could see changes in lending rates or service offerings as the bank navigates profitability challenges. In the broader market, NBTB's performance reflects the ongoing pressures faced by regional banks, particularly concerning interest rate sensitivity and competition from larger financial institutions.

Risk Assessment

Risk Level: medium — The net income decreased by $2.3 million (5.7%) from $40.5 million in Q2 2024 to $38.2 million in Q2 2025, and by $5.0 million (6.2%) for the six months ended June 30, 2025, compared to the same period in 2024. This consistent decline in profitability, despite a slight increase in total assets from $11.9 billion to $12.0 billion, indicates potential challenges in maintaining margins or managing expenses, posing a medium risk to future earnings stability.

Analyst Insight

Investors should closely monitor NBT Bancorp's upcoming earnings calls for detailed explanations of margin pressures and cost management strategies. Consider holding existing positions but deferring new investments until there's clear evidence of profitability stabilization or growth, especially given the competitive landscape for regional banks.

Financial Highlights

total Assets

$12.0B

net Income

$38.2M

Key Numbers

• $38.2M — Q2 2025 Net Income (Decreased from $40.5M in Q2 2024, indicating a 5.7% decline.)
• $75.1M — YTD 2025 Net Income (Down from $80.1M in YTD 2024, a 6.2% decrease.)
• $12.0B — Total Assets (Increased from $11.9B at December 31, 2024, showing modest growth.)
• $10.8B — Total Liabilities (Increased from $10.7B at December 31, 2024, mirroring asset growth.)
• $1.01B — Retained Earnings (Decreased from $1.03B at December 31, 2024, due to dividends and net income.)
• -$98.7M — Accumulated Other Comprehensive Income (Improved from a deficit of -$105.1M at December 31, 2024, reflecting better investment valuations.)

Key Players & Entities

• NBT BANCORP INC (company) — filer of the 10-Q
• $38.2 million (dollar_amount) — net income for Q2 2025
• $40.5 million (dollar_amount) — net income for Q2 2024
• $75.1 million (dollar_amount) — net income for six months ended June 30, 2025
• $80.1 million (dollar_amount) — net income for six months ended June 30, 2024
• $12.0 billion (dollar_amount) — total assets as of June 30, 2025
• $11.9 billion (dollar_amount) — total assets as of December 31, 2024
• $10.8 billion (dollar_amount) — total liabilities as of June 30, 2025
• $10.7 billion (dollar_amount) — total liabilities as of December 31, 2024
• $105.1 million (dollar_amount) — accumulated other comprehensive income deficit at December 31, 2024

FAQ

Risk Factors

• Interest Rate Risk [high — financial]: The company faces significant interest rate risk due to its balance sheet structure, particularly the sensitivity of its net interest income and the market value of its investment securities to changes in interest rates. Fluctuations in interest rates can impact borrowing costs and the profitability of lending activities.
• Credit Risk and Asset Quality [high — financial]: NBT Bancorp is exposed to credit risk through its loan portfolio. Deterioration in the credit quality of borrowers, economic downturns, or industry-specific challenges could lead to increased non-performing loans and loan loss provisions, impacting profitability.
• Cybersecurity and Data Security [medium — operational]: As a financial institution, the company is a target for cyberattacks. A breach of its systems could result in the compromise of sensitive customer data, financial losses, reputational damage, and regulatory penalties.
• Regulatory Compliance [medium — regulatory]: The banking industry is heavily regulated. Changes in regulations, increased compliance costs, or failure to comply with existing rules could adversely affect the company's operations, profitability, and ability to conduct business.
• Economic Conditions [high — market]: The company's financial performance is closely tied to the overall economic environment. Recessions, high unemployment, or other adverse economic trends can negatively impact loan demand, credit quality, and fee income.

Industry Context

NBT Bancorp operates within the national commercial banking sector, characterized by intense competition from larger national banks, regional players, and community banks. The industry is currently navigating a challenging economic environment marked by fluctuating interest rates and evolving customer expectations for digital services. Profitability is heavily influenced by net interest margins and the ability to manage credit risk effectively.

Regulatory Implications

As a regulated financial institution, NBT Bancorp must adhere to stringent capital requirements, consumer protection laws, and anti-money laundering regulations. Changes in monetary policy and banking regulations can significantly impact its lending capacity, operational costs, and overall business strategy.

What Investors Should Do

1. Monitor Net Interest Margin (NIM) trends
2. Analyze Loan Loss Provisions and Non-Performing Assets
3. Evaluate the recovery in Accumulated Other Comprehensive Income (AOCI)

Key Dates

• 2025-06-30: End of Second Quarter 2025 — Reporting period for the 10-Q filing, showing financial performance and position as of this date.
• 2025-08-08: 10-Q Filing Date — The date the company officially submitted its quarterly report to the SEC.
• 2025-04-01: Start of Second Quarter 2025 — Beginning of the reporting period for Q2 2025 results.
• 2024-06-30: End of Second Quarter 2024 — Comparative period for Q2 2025 net income.
• 2024-12-31: End of Fiscal Year 2024 — Comparative period for total assets, total liabilities, and retained earnings.

Glossary

Retained Earnings

The cumulative amount of net income that a company has retained over time, after accounting for dividend payments. (A decrease in retained earnings from $1.03 billion to $1.01 billion indicates that dividend payouts exceeded net income during the period, or that net income was lower than dividend payouts.)

Accumulated Other Comprehensive Income (AOCI)

A measure of the unrealized gains or losses on certain investments and foreign currency translations that are not included in net income. (An improvement in AOCI from a deficit of $105.1 million to $98.7 million suggests that the market value of certain investments held by the company has increased.)

Net Interest Income

The difference between the interest income generated by a bank's assets (like loans and securities) and the interest expense paid on its liabilities (like deposits and borrowings). (This is a key driver of profitability for banks and is sensitive to changes in interest rates, a stated risk for NBT Bancorp.)

Non-performing Loans

Loans for which the borrower is not making scheduled payments of principal or interest. (An increase in non-performing loans is an indicator of deteriorating credit quality and can lead to higher loan loss provisions.)

Year-Over-Year Comparison

Compared to the prior year's comparable period, NBT Bancorp Inc. has experienced a decline in net income, with Q2 2025 net income at $38.2 million versus $40.5 million in Q2 2024. Total assets have seen modest growth, increasing to $12.0 billion from $11.9 billion at year-end 2024, with liabilities mirroring this growth. Retained earnings have decreased, reflecting dividend payouts and lower net income compared to the prior period. While still in a deficit, Accumulated Other Comprehensive Income has shown improvement, indicating a better valuation of certain investments.

Key Financial Figures

• $0.01 — ch registered Common Stock, par value $0.01 per share NBTB The NASDAQ Stock Mar

Filing Documents

• ef20050375_10q.htm (10-Q) — 5151KB
• ef20050375_ex31-1.htm (EX-31.1) — 7KB
• ef20050375_ex31-2.htm (EX-31.2) — 7KB
• ef20050375_ex32-1.htm (EX-32.1) — 4KB
• ef20050375_ex32-2.htm (EX-32.2) — 4KB
• 0001140361-25-029850.txt ( ) — 23034KB
• nbtb-20250630.xsd (EX-101.SCH) — 73KB
• nbtb-20250630_cal.xml (EX-101.CAL) — 149KB
• nbtb-20250630_def.xml (EX-101.DEF) — 390KB
• nbtb-20250630_lab.xml (EX-101.LAB) — 1064KB
• nbtb-20250630_pre.xml (EX-101.PRE) — 628KB
• ef20050375_10q_htm.xml (XML) — 6539KB

FINANCIAL STATEMENTS (Unaudited)

FINANCIAL STATEMENTS (Unaudited) Consolidated Balance Sheets 4 Consolidated Statements of Income 5 Consolidated Statements of Comprehensive Income (Loss) 6 Consolidated Statements of Changes in Stockholders' Equity 7 Consolidated Statements of Cash Flows 8 Notes to Unaudited Interim Consolidated Financial Statements 10 ITEM 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 36 ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 54 ITEM 4.

CONTROLS AND PROCEDURES

CONTROLS AND PROCEDURES 54 PART II OTHER INFORMATION ITEM 1.

LEGAL PROCEEDINGS

LEGAL PROCEEDINGS 54 ITEM 1A.

RISK FACTORS

RISK FACTORS 54 ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 54 ITEM 3. DEFAULTS UPON SENIOR SECURITIES 54 ITEM 4. MINE SAFETY DISCLOSURES 54 ITEM 5. OTHER INFORMATION 54 ITEM 6. EXHIBITS 54

SIGNATURES

SIGNATURES 55 2 Table of Contents GLOSSARY OF ABBREVIATIONS AND ACRONYMS When references to "NBT", "we," "our," "us," and "the Company" are made in this report, we mean NBT Bancorp Inc. and our consolidated subsidiaries, unless the context indicates that we refer only to the parent company, NBT Bancorp Inc. When we refer to the "Bank" in this report, we mean our only bank subsidiary, NBT Bank, National Association, and its subsidiaries. The acronyms and abbreviations identified below are used throughout this report, including the Notes to Unaudited Interim Consolidated Financial Statements. You may find it helpful to refer to this page as you read this report. AFS available for sal e AIR accrued interest receivable AOCI accumulated other comprehensive income (loss) ASC Accounting Standards Codification ASU Accounting Standards Update bp(s) basis point(s) C&I commercial & industrial CECL current expected credit losses CME Chicago Mercantile Exchange Clearing House CODM chief operating decision maker CRE commercial real estate EPS earnings per share Evans Evans Bancorp, Inc. Evans Bank Evans Bank, National Association FASB Financial Accounting Standards Board FDIC Federal Deposit Insurance Corporation FHLB Federal Home Loan Bank FOMC Federal Open Market Committee FRB Federal Reserve Board FTE fully taxable equivalent GAAP U.S. generally accepted accounting principles GDP Gross Domestic Product HTM held to maturity LGD loss given default MMDA money market deposit accounts NASDAQ The NASDAQ Stock Market LLC NIM net interest margin OCC Office of the Comptroller of the Currency OREO other real estate owned PCD purchased credit deteriorated PD probability of default SEC U.S. Securities and Exchange Commission SOFR Secured Overnight Financing Rate 3 Table of Contents ITEM 1.

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS NBT Bancorp Inc. and Subsidiaries Consolidated Balance Sheets (unaudited) June 30, December 31, (In thousands, except share and per share data) 2025 2024 Assets Cash and due from banks $ 264,777 $ 205,083 Short-term interest-bearing accounts 276,786 78,973 Equity securities, at fair value 46,658 42,372 Securities available for sale, at fair value 1,729,428 1,574,664 Securities held to maturity (fair value $ 735,387 and $ 749,945 , respectively) 809,664 842,921 Federal Reserve and Federal Home Loan Bank stock 40,813 33,957 Loans held for sale 3,756 9,744 Loans 11,624,680 9,969,910 Less allowance for loan losses 140,200 116,000 Net loans $ 11,484,480 $ 9,853,910 Premises and equipment, net 95,793 80,840 Goodwill 454,072 362,663 Intangible assets, net 64,447 36,360 Bank owned life insurance 318,004 272,657 Other assets 426,103 392,522 Total assets $ 16,014,781 $ 13,786,666 Liabilities Demand (noninterest bearing) $ 3,866,856 $ 3,446,068 Savings, interest-bearing checking and money market 7,997,219 6,658,188 Time 1,651,157 1,442,505 Total deposits $ 13,515,232 $ 11,546,761 Short-term borrowings 112,970 162,942 Long-term debt 44,842 29,644 Subordinated debt, net 141,943 121,201 Junior subordinated debt 111,621 101,196 Other liabilities 283,007 298,781 Total liabilities $ 14,209,615 $ 12,260,525 Stockholders' equity Preferred stock, $ 0.01 par value. 2,500,000 shares authorized $ - $ - Common stock, $ 0.01 par value. 100,000,000 shares authorized; 59,083,155 and 53,974,492 shares issued, respectively 591 540 Additional paid-in-capital 962,868 742,810 Retained earnings 1,125,589 1,100,209 Accumulated other comprehensive loss ( 109,488 ) ( 142,098 ) Common stock in treasury, at cost, 6,705,868 and 6,779,975 shares, respectively ( 174,394 ) ( 175,320 ) Total stock

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View this 10-Q filing on SEC EDGAR