Tompkins Financial Corporation Reports Record Second Quarter Earnings

ITHACA, N.Y.--(BUSINESS WIRE)-- Tompkins Financial Corporation (NYSEMKT: TMP)

Tompkins Financial Corporation reported record net income of $17.4 million for the second quarter of 2015, an increase of 33.1% from the $13.1 million reported for the same period in 2014. Diluted earnings per share were $1.15 for the quarter, up from $0.87 per share for the second quarter last year. Results for the current quarter were helped by a one-time curtailment gain of $3.6 million after tax ($0.24 per share) related to changes to the Company’s pension plan. If this gain were excluded from the current period results, diluted earnings per share would have been $0.91, which would still reflect the best second quarter in Company history. The impact of this non-recurring item on the Company’s financial statements is more fully detailed in the non-GAAP disclosure tables included with this press release.

For the year-to-date period ended June 30, 2015, net income was $30.1 million, an increase of 17.3% from the $25.6 million reported for the same period in 2014. Diluted earnings per share were $2.00 for the year-to-date period ended June 30, 2015, up 16.3% compared to the $1.72 per share reported for the same period last year. These results were also aided by the curtailment gain described above. If this gain were excluded from year to date results, net income for the period would have been $26.0 million for the first six months of 2015, and diluted earnings per share would have been $1.75. Refer to non-GAAP disclosures for additional details.

SELECTED HIGHLIGHTS FOR SECOND QUARTER:

• Net interest income of $41.3 million was up 2.0% compared to the second quarter of 2014.
• Total loans of $3.5 billion were up 9.1% over June 30, 2014.
• Credit quality improved with non-performing assets representing 0.44% of total assets, which is the lowest this percentage has been over the past 25 quarters. The percentage is down from 0.66% one year ago and remains well below the most recent Federal Reserve peer average1 of 0.88%.
• Annualized return on average equity was 13.79% for the second quarter of 2015, compared to 10.91% reported for the second quarter of 2014, the second quarter of 2015 included a $3.6 million (net of tax) gain on the pension plan curtailment.
• Tangible book value per share is up 4.1% from the second quarter of 2014. Refer to Non-GAAP disclosure for additional details on tangible book value per share.

President and CEO, Stephen S. Romaine said "It is very exciting to report on another record quarter for earnings performance. When compared to the same period last year, positive trends that contributed to these results included: growth in loans, deposits, insurance revenue, and card related revenue, as well as continued excellent asset quality.”

NET INTEREST INCOME

Net interest income of $41.3 million for the second quarter of 2015 increased 2.0% compared to the same period in 2014, and was in line with the first quarter of 2015. For the year-to-date period, net interest income of $82.6 million was up 2.5% from the prior year. The net interest margin for the second quarter of 2015 was 3.37%, compared to 3.55% for the same period in 2014. For the year to date, net interest margin was 3.41% in 2015, compared to 3.58% in 2014.

NONINTEREST INCOME

Noninterest income represented 31.5% of total revenue for the second quarter of 2015, compared to 30.4% of total revenue in the second quarter of 2014. Noninterest income was $19.0 million for the second quarter of 2015, up 7.0% compared to the second quarter of 2014, and up 7.5% compared to first quarter 2015. The increase over the same quarter last year included improvements in insurance revenue and card services income. Growth during the quarter also benefited from $723,000 of gains on the sale of available-for-sale securities and $924,000 of gains on the sale of other real estate owned (OREO). For the first six months of 2015, noninterest income was up $1.5 million, or 4.1% over the same period in 2014.

NONINTEREST EXPENSE

Noninterest expense was $32.9 million for the second quarter of 2015, down 15.4% compared to the second quarter of 2014. For the year-to-date period, noninterest expense was down 5.9% from the same period in 2014. The decrease in noninterest expense for both the quarter-to-date and year-to-date periods was mainly due to a $6.0 million gain on a pension plan curtailment recorded in the second quarter of 2015. The curtailment gain is related to a freeze of the Company’s defined benefit pension plan which has been replaced with a more flexible defined contribution pension plan.

ASSET QUALITY

Asset quality remains strong. Substandard and Special Mention loans declined by $28.3 million from the same period last year, and by $10.1 million from the previous quarter.

Provision for loan and lease losses was $922,000 for the second quarter of 2015, up $855,000 compared to the second quarter of 2014. The increase over the second quarter of 2014 reflects increased provision expense primarily due to loan growth.

The Company’s allowance for originated loan and lease losses totaled $29.4 million at June 30, 2015, which represented 0.98% of total originated loans, compared to 1.02% at June 30, 2014 and 0.99% at year-end 2014. The allowance for loan and lease losses covered 139.36% of nonperforming loans and leases as of June 30, 2015, compared to 103.08% at June 30, 2014 and 128.43% at year-end 2014.

CAPITAL POSITION

Capital ratios remain well above the regulatory well capitalized minimums. Tier 1 capital to average assets of 8.92% is up from 8.79% at June 30, 2014. The ratio of tangible common equity to tangible assets (refer to Non-GAAP disclosures) improved to 7.48%, up from 7.40% reported at December 31, 2014.

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.

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 reconciliation to the comparable GAAP measure, is provided in the accompanying tables. Management believes that these non-GAAP measures provide useful information. Non-GAAP measures should not be considered a substitute for financial measures determined in accordance with GAAP and investors should consider the Company’s performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. See “Tompkins Financial Corporation - Summary Financial Data (Unaudited)” tables for Non-GAAP related calculations.

"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.

TOMPKINS FINANCIAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION
(In thousands, except share and per share data) (Unaudited)					As of				As of
ASSETS					06/30/2015				12/31/2014
Cash and noninterest bearing balances due from banks				$	58,237			$	53,921
Interest bearing balances due from banks					1,902				2,149
	Cash and Cash Equivalents				60,139				56,070
Trading securities, at fair value					8,153				8,992
Available-for-sale securities, at fair value (amortized cost of $1,381,440 at June 30,
	2015 and $1,397,458 at December 31, 2014)				1,382,484				1,402,236
Held-to-maturity securities, at amortized cost (fair value of $146,076 at June 30, 2015
	and $89,036 at December 31, 2014)				145,737				88,168
Originated loans and leases, net of unearned income and deferred costs and fees (2)					3,013,968				2,839,974
Acquired loans and leases, covered (3)					15,771				19,319
Acquired loans and leases, non-covered (3)					492,192				533,995
Less: Allowance for loan and lease losses					30,091				28,997
	Net Loans and Leases				3,491,840				3,364,291
FDIC indemnification asset					634				1,903
Federal Home Loan Bank stock					27,128				21,259
Bank premises and equipment, net					59,451				59,800
Corporate owned life insurance					74,894				73,725
Goodwill					92,243				92,243
Other intangible assets, net					13,569				14,649
Accrued interest and other assets					79,864				86,225
	Total Assets			$	5,436,136			$	5,269,561
LIABILITIES
Deposits:
	Interest bearing:
	Checking, savings and money market				2,314,510				2,247,708
	Time				906,345				898,081
	Noninterest bearing				983,234				1,023,365
	Total Deposits				4,204,089				4,169,154
Federal funds purchased and securities sold under agreements to repurchase					131,063				147,037
Other borrowings, including certain amounts at fair value of $10,817 at June 30, 2015
	and $10,961 at December 31, 2014				493,326				356,541
Trust preferred debentures					37,423				37,337
Other liabilities					64,841				69,909
	Total Liabilities			$	4,930,742			$	4,779,978
EQUITY
Tompkins Financial Corporation shareholders' equity:
	Common Stock - par value $.10 per share: Authorized 25,000,000 shares; Issued:
		14,978,017 at June 30, 2015; and 14,931,354 at December 31, 2014			1,498				1,493
	Additional paid-in capital				351,549				348,889
	Retained earnings				181,955				165,160
	Accumulated other comprehensive loss				(27,621	)			(24,011	)
	Treasury stock, at cost – 111,467 shares at June 30, 2015, and 111,436 shares
		at December 31, 2014			(3,504	)			(3,400	)
	Total Tompkins Financial Corporation Shareholders’ Equity				503,877				488,131
Noncontrolling interests					1,517				1,452
	Total Equity			$	505,394			$	489,583
	Total Liabilities and Equity			$	5,436,136			$	5,269,561

TOMPKINS FINANCIAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
			Three Months Ended						Six Months Ended
(In thousands, except per share data) (Unaudited)			06/30/2015			06/30/2014			06/30/2015			06/30/2014
INTEREST AND DIVIDEND INCOME
Loans		$	38,059		$	37,348		$	75,435		$	74,302
Due from banks			1			0			2			1
Trading securities			90			107			184			219
Available-for-sale securities			7,374			7,984			15,188			15,920
Held-to-maturity securities			674			186			1,270			338
Federal Home Loan Bank stock and Federal Reserve Bank stock			225			194			572			404
Total Interest and Dividend Income			46,423			45,819			92,651			91,184
INTEREST EXPENSE
Time certificates of deposits of $250,000 or more			354			328			689			635
Other deposits			2,267			2,449			4,553			4,884
Federal funds purchased and securities sold under agreements to
repurchase			665			763			1,335			1,580
Trust preferred debentures			573			571			1,143			1,141
Other borrowings			1,234			1,192			2,373			2,401
Total Interest Expense			5,093			5,303			10,093			10,641
Net Interest Income			41,330			40,516			82,558			80,543
Less: Provision for loan and lease losses			922			67			1,131			810
Net Interest Income After Provision for Loan and Lease Losses			40,408			40,449			81,427			79,733
NONINTEREST INCOME
Insurance commissions and fees			7,407			7,046			14,777			14,303
Investment services income			3,838			3,902			7,844			7,912
Service charges on deposit accounts			2,244			2,388			4,402			4,504
Card services income			2,025			1,920			3,843			4,032
Mark-to-market loss on trading securities			(74	)		(34	)		(137	)		(93	)
Mark-to-market gain on liabilities held at fair value			104			63			145			128
Other income			2,695			2,400			4,721			4,239
Gain on sale of available-for-sale securities			723			35			1,013			129
Total Noninterest Income			18,962			17,720			36,608			35,154
NONINTEREST EXPENSES
Salaries and wages			18,394			17,660			35,962			34,306
Pension and other employee benefits			(519	)		4,978			5,475			11,023
Net occupancy expense of premises			3,073			3,066			6,412			6,326
Furniture and fixture expense			1,483			1,459			2,933			2,796
FDIC insurance			748			735			1,489			1,546
Amortization of intangible assets			500			525			1,007			1,052
Other operating expense			9,239			10,505			19,332			20,089
Total Noninterest Expenses			32,918			38,928			72,610			77,138
Income Before Income Tax Expense			26,452			19,241			45,425			37,749
Income Tax Expense			9,030			6,148			15,290			12,054
Net Income attributable to Noncontrolling Interests and Tompkins Financial Corporation			17,422			13,093			30,135			25,695
Less: Net income attributable to noncontrolling interests			32			32			65			65
Net Income Attributable to Tompkins Financial Corporation		$	17,390		$	13,061		$	30,070		$	25,630
Basic Earnings Per Share		$	1.16		$	0.88		$	2.01		$	1.73
Diluted Earnings Per Share		$	1.15		$	0.87		$	2.00		$	1.72

Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited)
				Quarter Ended							Year to Date Period Ended							Year to Date Period Ended
				June 30, 2015							June 30, 2015							June 30, 2014
				Average							Average							Average
				Balance				Average			Balance				Average			Balance				Average
(Dollar amounts in thousands)				(QTD)		Interest		Yield/Rate			(YTD)		Interest		Yield/Rate			(YTD)		Interest		Yield/Rate
ASSETS
Interest-earning assets
	Interest-bearing balances due from banks		$	1,824	$	1		0.22	%	$	1,607	$	2		0.25	%	$	885	$	1		0.23	%
	Securities (4)
		U.S. Government securities		1,450,039		7,513		2.08	%		1,442,846		15,366		2.15	%		1,301,015		14,877		2.31	%
		Trading securities		8,453		90		4.27	%		8,654		184		4.29	%		10,584		219		4.17	%
		State and municipal (5)		86,710		832		3.85	%		87,502		1,703		3.92	%		89,964		2,127		4.77	%
		Other securities (5)		3,752		30		3.21	%		3,758		60		3.22	%		4,729		76		3.24	%
		Total securities		1,548,954		8,465		2.19	%		1,542,760		17,313		2.26	%		1,406,292		17,299		2.48	%
	FHLBNY and FRB stock			23,927		225		3.76	%		22,355		572		5.15	%		20,670		404		3.94	%
	Total loans and leases, net of unearned income (5)(6)			3,463,881		38,680		4.48	%		3,431,282		76,635		4.50	%		3,206,950		75,161		4.73	%
	Total interest-earning assets			5,038,586		47,371		3.77	%		4,998,004		94,522		3.81	%		4,634,797		92,865		4.04	%
Other assets				352,528							355,264							371,552
	Total assets			5,391,114							5,353,268							5,006,349
LIABILITIES & EQUITY
Deposits
	Interest-bearing deposits
		Interest bearing checking, savings, & money market		2,326,361		924		0.16	%		2,337,605		1,914		0.17	%		2,272,478		2,211		0.20	%
		Time deposits		917,986		1,697		0.74	%		912,016		3,328		0.74	%		895,073		3,308		0.75	%
		Total interest-bearing deposits		3,244,347		2,621		0.32	%		3,249,621		5,242		0.33	%		3,167,551		5,519		0.35	%
Federal funds purchased & securities sold under
		agreements to repurchase		131,324		665		2.03	%		136,811		1,335		1.97	%		153,939		1,580		2.07	%
Other borrowings				422,364		1,234		1.17	%		385,233		2,373		1.24	%		263,633		2,401		1.84	%
Trust preferred debentures				37,395		573		6.15	%		37,374		1,143		6.17	%		37,205		1,141		6.18	%
	Total interest-bearing liabilities			3,835,430		5,093		0.53	%		3,809,039		10,093		0.53	%		3,622,328		10,641		0.59	%
Noninterest bearing deposits				983,199							978,233							856,161
Accrued expenses and other liabilities				66,818							64,615							53,539
	Total liabilities			4,885,447							4,851,887							4,532,028
Tompkins Financial Corporation Shareholders’ equity				504,166							499,896							472,836
Noncontrolling interest				1,501							1,485							1,485
	Total equity			505,667							501,381							474,321
	Total liabilities and equity		$	5,391,114						$	5,353,268						$	5,006,349
Interest rate spread								3.24	%						3.28	%						3.45	%
	Net interest income/margin on earning assets					42,278		3.37	%				84,429		3.41	%				82,224		3.58	%
Tax Equivalent Adjustment						(948	)						(1,871	)						(1,681	)
	Net interest income per consolidated financial statements				$	41,330						$	82,558						$	80,543

Tompkins Financial Corporation - Summary Financial Data (Unaudited)
(In thousands, except per share data)		Quarter-Ended														Year-Ended
		Jun-15			Mar-15			Dec-14			Sep-14			Jun-14			Dec-14
Period End Balance Sheet
Securities	$	1,536,374		$	1,555,597		$	1,499,396		$	1,431,837		$	1,420,226		$	1,499,396
Originated loans and leases, net of unearned income and deferred costs and fees (2)		3,013,968			2,898,533			2,839,974			2,674,971			2,610,289			2,839,974
Acquired loans and leases (3)		507,963			529,024			553,314			582,498			618,679			553,314
Allowance for loan and lease losses		30,091			29,485			28,997			27,786			27,517			28,997
Total assets		5,436,136			5,357,533			5,269,561			5,090,919			5,057,821			5,269,561
Total deposits		4,204,089			4,282,766			4,169,154			4,212,860			4,044,389			4,169,154
Federal funds purchased and securities sold under agreements to repurchase		131,063			135,769			147,037			128,368			144,796			147,037
Other borrowings		493,326			330,850			356,541			166,509			287,158			356,541
Trust preferred debentures		37,423			37,380			37,337			37,298			37,254			37,337
Total common equity		503,877			502,811			488,131			489,061			487,720			488,131
Total equity		505,394			504,296			489,583			490,611			489,237			489,583
Average Balance Sheet
Average earning assets	$	5,038,586		$	4,956,972		$	4,799,027		$	4,695,860		$	4,666,722		$	4,691,582
Average assets		5,391,114			5,315,002			5,193,347			5,058,608			5,030,395			5,066,655
Average interest-bearing liabilities		3,835,430			3,782,355			3,668,311			3,587,673			3,620,130			3,625,184
Average equity		505,667			497,047			495,531			489,920			480,063			483,599
Share data
Weighted average shares outstanding (basic)		14,751,844			14,701,397			14,639,631			14,711,709			14,709,881			14,676,622
Weighted average shares outstanding (diluted)		14,878,107			14,837,935			14,765,855			14,795,343			14,821,191			14,789,624
Period-end shares outstanding		14,942,107			14,962,079			14,895,444			14,794,092			14,853,439			14,895,444
Common equity book value per share	$	33.72		$	33.61		$	32.77		$	33.06		$	32.84		$	32.77
Tangible book value per share (Non-GAAP)	$	26.71		$	26.56		$	25.66		$	25.87		$	25.65		$	25.66
Income Statement
Net interest income	$	41,330		$	41,228		$	41,692		$	41,575		$	40,516		$	163,810
Provision (Credit) for loan/lease losses		922			209			1,555			(59	)		67			2,306
Noninterest income		18,962			17,646			18,056			17,555			17,720			70,765
Noninterest expense		32,918			39,692			39,018			38,537			38,928			154,693
Income tax expense		9,030			6,260			6,453			6,897			6,148			25,404
Net income attributable to Tompkins Financial Corporation		17,390			12,680			12,689			13,722			13,061			52,041
Noncontrolling interests		32			33			33			33			32			131
Basic earnings per share (9)	$	1.16		$	0.85		$	0.86		$	0.92		$	0.88		$	3.51
Diluted earnings per share (9)	$	1.15		$	0.84		$	0.85		$	0.92		$	0.87		$	3.48
Nonperforming Assets
Originated nonaccrual loans and leases	$	14,566		$	13,811		$	14,299		$	16,319		$	16,918		$	14,299
Acquired nonaccrual loans and leases		5,030			4,683			4,729			4,998			5,907			4,729
Originated loans and leases 90 days past due and accruing		58			236			106			395			543			106
Troubled debt restructurings not included above		1,939			1,589			3,444			3,800			3,327			3,444
Total nonperforming loans and leases		21,593			20,319			22,578			25,512			26,695			22,578
OREO (8)		2,570			5,816			5,683			6,533			6,795			5,683
Total nonperforming assets	$	24,163		$	26,135		$	28,261		$	32,045		$	33,490		$	28,261
		Quarter-Ended														Year-Ended
Delinquency - Originated loan and lease portfolio		Jun-15			Mar-15			Dec-14			Sep-14			Jun-14			Dec-14
Loans and leases 30-89 days past due and
accruing (2)	$	3,315		$	2,438		$	6,849		$	3,811		$	5,221		$	6,849
Loans and leases 90 days past due and accruing (2)		58			236			106			395			543			106
Total originated loans and leases past due and accruing (2)		3,373			2,674			6,955			4,206			5,764			6,955
Delinquency - Acquired loan and lease portfolio
Covered loans and leases 30-89 days past due and accruing (3)(7)	$	455		$	547		$	533		$	0		$	0		$	533
Covered loans and leases 90 days or more past
due and accruing (3)(7)		674			682			914			1,149			904			914
Non-covered loans and leases 30-89 days past
due and accruing (3)(7)		917			2,546			1,186			736			1,620			1,186
Non-covered loans and leases 90 days past
due and accruing (3)(7)		3,031			2,811			2,614			3,171			3,048			2,614
Total acquired loans and leases past due and accruing		5,077			6,586			5,247			5,056			5,572			5,247
Total loans and leases past due and accruing	$	8,450		$	9,260		$	12,202		$	9,262		$	11,336		$	12,202
Allowance for Loan Losses - Originated loan and lease portfolio
Balance at beginning of period	$	28,690		$	28,156		$	27,185		$	26,752		$	26,661		$	26,700
Provision (Credit) for loan and lease losses		769			340			1,102			(264	)		(56	)		1,293
Net loan and lease charge-offs (recoveries)		31			(194	)		131			(697	)		(147	)		(163	)
Allowance for loan and lease losses (originated		29,428			28,690			28,156			27,185			26,752			28,156
loan portfolio) - balance at end of period	$			$			$			$			$			$
Allowance for Loan Losses - Acquired loan and lease portfolio
Balance at beginning of period	$	795		$	841		$	601		$	765		$	1,353		$	1,270
Provision (Credit) for loan and lease losses		153			(131	)		453			205			123			1,013
Net loan and lease charge-offs (recoveries)		285			(85	)		213			369			711			1,442
Allowance for loan and lease losses (acquired
loan portfolio) - balance at end of period		663			795			841			601			765			841
Total allowance for loan and lease losses	$	30,091		$	29,485		$	28,997		$	27,786		$	27,517		$	28,997
Loan Classification - Originated Portfolio
Special Mention	$	25,706		$	34,965		$	36,331		$	27,854		$	35,484		$	36,331
Substandard		21,600			19,150			19,970			25,889			21,253			19,970
Loan Classification - Acquired Portfolio
Special Mention		1,589			5,053			5,758			7,605			12,124			5,758
Substandard		21,932			21,752			21,567			24,034			30,273			21,567
Loan Classifications - Total Portfolio
Special Mention		27,295			40,018			42,089			35,459			47,608			42,089
Substandard		43,532			40,902			41,537			49,923			51,526			41,537
RATIO ANALYSIS		Quarter-Ended														Year-Ended
Credit Quality		Jun-15			Mar-15			Dec-14			Sep-14			Jun-14			Dec-14
Nonperforming loans and leases/total loans and leases (7)		0.61	%		0.59	%		0.67	%		0.78	%		0.83	%		0.67	%
Nonperforming assets/total assets		0.44	%		0.49	%		0.54	%		0.63	%		0.66	%		0.54	%
Allowance for originated loan and lease losses/total originated loans and leases		0.98	%		0.99	%		0.99	%		1.02	%		1.02	%		0.99	%
Allowance/nonperforming loans and leases		139.36	%		145.11	%		128.43	%		108.92	%		103.08	%		128.43	%
Net loan and lease losses (recoveries) annualized/total average loans and leases		0.04	%		(0.03	%)		0.04	%		(0.04	%)		0.07	%		0.04	%
Capital Adequacy (period-end)
Tier 1 capital / average assets *		8.92	%		8.85	%		8.75	%		8.85	%		8.79	%		8.75	%
Total capital / risk-weighted assets *		13.46	%		13.37	%		13.60	%		13.92	%		13.92	%		13.60	%
*Beginning with March 31, 2015, ratios are calculated utilizing Basel III regulatory capital framework
Profitability
Return on average assets *		1.29	%		0.97	%		0.97	%		1.08	%		1.04	%		1.03	%
Return on average equity *		13.79	%		10.35	%		10.16	%		11.11	%		10.91	%		10.76	%
Net interest margin (TE) *		3.37	%		3.45	%		3.53	%		3.58	%		3.55	%		3.57	%
* Quarterly ratios have been annualized
Non-GAAP Disclosure - Adjusted Diluted Earnings Per Share
Net income available to common shareholders	$	17,390		$	12,680		$	12,689		$	13,722		$	13,061		$	52,041
Less: Dividends and undistributed earnings allocated to unvested restricted stock awards		234			182			150			119			118			503
Adjusted net income available to common shareholders		17,156			12,498			12,539			13,603			12,943			51,538
Gain on pension plan curtailment (net of tax)		(3,602	)		0			0			0			0			0
Net operating income (Non-GAAP)		13,554			12,498			12,539			13,603			12,943			51,538
Weighted average shares outstanding (diluted)		14,878,107			14,837,935			14,765,855			14,795,343			14,821,191			14,789,624
Adjusted diluted earnings per share (Non-GAAP) (9)	$	0.91		$	0.84		$	0.85		$	0.92		$	0.87		$	3.48
Non-GAAP Disclosure - Tangible Common Equity / Tangible Assets
Total Common equity	$	503,877		$	502,811		$	488,131		$	489,061		$	487,720		$	488,131
Less: Goodwill and intangibles (10)		104,845			105,344			105,852			106,377			106,690			105,852
Tangible common equity		399,032			397,467			382,279			382,684			381,030			382,279
Total assets		5,436,136			5,357,533			5,269,561			5,090,919			5,057,821			5,269,561
Less: Goodwill and intangibles (10)		104,845			105,344			105,852			106,377			106,690			105,852
Tangible assets		5,331,291			5,252,189			5,163,709			4,984,542			4,951,131			5,163,709
Tangible common equity / tangible assets (Non-GAAP)		7.48	%		7.57	%		7.40	%		7.68	%		7.70	%		7.40	%
Non-GAAP Disclosure - Return on Average		Quarter-Ended														Year-Ended
Tangible Common Equity		Jun-15			Mar-15			Dec-14			Sep-14			Jun-14			Dec-14
Net income available to common shareholders	$	17,390		$	12,680		$	12,689		$	13,722		$	13,061		$	52,041
Less: Dividends and undistributed earnings allocated to unvested restricted stock awards		234			182			150			119			118			503
Adjusted net income available to common shareholders		17,156			12,498			12,539			13,603			12,943			51,538
Gain on pension plan curtailment (net of tax)		(3,602	)		0			0			0			0			0
Net operating income (Non-GAAP)		13,554			12,498			12,539			13,603			12,943			51,538
Amortization of intangibles (net of tax)		300			304			315			311			315			1,257
Adjusted net operating income (Non-GAAP)		13,854			12,802			12,854			13,914			13,258			52,795
Average common equity		504,166			495,579			493,986			488,386			478,561			482,087
Less: Average goodwill and intangibles (10)		105,130			105,644			106,151			106,471			106,988			106,748
Average tangible common equity capital		399,036			389,935			387,835			381,915			371,573			375,339
Adjusted operating return on average tangible common equity (annualized) (Non-GAAP)		13.93	%		13.32	%		13.15	%		14.46	%		14.31	%		14.07	%
Non-GAAP Disclosure - Tangible Book Value Per Share
Total common equity	$	503,877		$	502,811		$	488,131		$	489,061		$	487,720		$	488,131
Less: Goodwill and intangibles (10)		104,845			105,344			105,852			106,377			106,690			105,852
Tangible common equity		399,032			397,467			382,279			382,684			381,030			382,279
Ending shares outstanding		14,942,107			14,962,079			14,895,444			14,794,092			14,853,439			14,895,444
Tangible book value per share (Non-GAAP)	$	26.71		$	26.56		$	25.66		$	25.87		$	25.65		$	25.66
Non-GAAP Disclosure - YTD adjusted diluted earnings per share
				Jun-15			Jun-14
Net income available to common shareholders				$	30,070		$	25,630
Less: Dividends and undistributed earnings allocated to unvested restricted stock awards					420			234
Adjusted net income available to common shareholders					29,650			25,396
Gain on pension plan curtailment					(3,602	)		0
Net operating income (Non-GAAP)					26,048			25,396
Weighted average shares outstanding (diluted)					14,858,127			14,798,462
Adjusted diluted earnings per share (Non-GAAP)				$	1.75		$	1.72

(1) Federal Reserve peer ratio as of March 31, 2015, includes banks and bank holding companies with consolidated assets between $3 billion and $10 billion.

(2) "Originated" equals loans and leases not included by definition in "acquired loans".

(3)"Acquired Loans and Leases" equals loans and leases acquired at fair value, accounted for in accordance with FASB ASC Topic 805. "Covered Loans" are loans for which the Company will share losses with the FDIC and consist of loans VIST Bank acquired as part of an FDIC-assisted transaction during the fourth quarter of 2010.

(4) Average balances and yields on available-for-sale securities are based on historical amortized cost.

(5) Interest income includes the tax effects of taxable-equivalent basis.

(6) Nonaccrual loans are included in the average asset totals presented above. Payments received on nonaccrual loans have been recognized as disclosed in Note 1 of the Company's consolidated financial statements included in Part I of the Company's annual report on Form 10-K for the fiscal year ended December 31, 2014.

(7) Certain acquired loans and leases that are past due are not on nonaccrual and are not included in nonperforming loans. The risk of credit loss on these loans has been considered by virtue of the Corporation's estimate of acquisition-date fair value and these loans are considered accruing as the Corporation primarily recognizes interest income through accretion of the difference between the carrying value of these loans and their expected cash flows.

(8) Includes all other real estate owned, including those balances acquired through business combinations.

(9)Earnings per share year-to-date may not equal the sum of the quarterly earnings per share as a result of rounding of average shares.

(10) "Goodwill and intangibles" equal Total Intangible Assets less Mortgage Servicing Rights in the above tables.

View source version on businesswire.com: http://www.businesswire.com/news/home/20150731005089/en/

Tompkins Financial Corporation
Stephen S. Romaine, 888-503-5753
President & CEO
or
Francis M. Fetsko, 888-503-5753
Executive VP, CFO & COO

Source: Tompkins Financial Corporation

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