Trustco Reports Third Quarter 2024 Net Income of $12.9 Million; Skillful Application of Strong Fundamentals Produce Solid Results

Rhea-AI Summary

TrustCo Bank Corp NY (NASDAQ: TRST) reported third quarter 2024 net income of $12.9 million or $0.68 diluted earnings per share, compared to $14.7 million or $0.77 per share in Q3 2023. Average loans increased by $127.0 million or 2.6% year-over-year. Key highlights include:

- Net interest income of $38.7 million, up 2.3% from Q2 2024
- Net interest margin improved to 2.61%, up 8 basis points from Q2 2024
- Average deposits increased by $15.3 million or 0.3% year-over-year
- Book value per share rose to $35.19, up 7.3% from a year earlier
- Equity to asset ratio improved to 10.95% from 10.31% in Q3 2023

The bank's focus on home equity lines of credit and competitive CD rates helped maintain strong customer relationships and manage interest expenses. Asset quality remained strong, with a provision for credit losses of $500,000 in Q3 2024.

Positive

• Net income increased to $12.9 million in Q3 2024 from $12.6 million in Q2 2024
• Average loans grew by 2.6% year-over-year
• Net interest income rose 2.3% quarter-over-quarter to $38.7 million
• Net interest margin improved by 8 basis points to 2.61%
• Book value per share increased 7.3% year-over-year to $35.19
• Equity to asset ratio improved to 10.95% from 10.31% year-over-year

Negative

• Q3 2024 net income of $12.9 million was lower than $14.7 million in Q3 2023
• Diluted EPS decreased to $0.68 in Q3 2024 from $0.77 in Q3 2023
• Nine-month net income fell to $37.6 million from $48.9 million year-over-year
• Nonperforming loans increased to $19.4 million from $17.9 million year-over-year

Insights

Financial Analyst

TrustCo Bank Corp NY (TRST) reported solid Q3 2024 results, demonstrating resilience in a challenging environment. Key highlights include:

• Net income of $12.9 million ($0.68 EPS), up from $12.6 million in Q2 2024
• Net interest income increased 2.3% quarter-over-quarter to $38.7 million
• Average loan portfolio grew 2.6% year-over-year
• Net interest margin improved to 2.61%, up 8 basis points from Q2
• Book value per share increased to $35.19, up 7.3% year-over-year

The bank's focus on fundamentals and relationship banking has paid off, with growth in loans and deposits despite market challenges. Asset quality remains strong, with a slight increase in nonperforming loans. The improved net interest margin and controlled expenses contributed to the solid performance. While earnings are down year-over-year, the sequential improvement and balance sheet growth are positive signs for investors.

Banking Industry Expert

TrustCo's Q3 results highlight its adept navigation of the current interest rate environment. The bank's strategy of encouraging HECL utilization and directing deposit flow into CDs has proven effective in managing interest expenses and boosting net interest income. This approach, coupled with loan growth at higher rates, has supported the expansion of net interest margin to 2.61%.

The 18.7% year-over-year growth in home equity lines of credit is particularly noteworthy, indicating successful cross-selling and customer retention efforts. The bank's ability to grow its loan portfolio while maintaining strong asset quality (NPLs at 0.38% of total loans) demonstrates prudent risk management.

The increase in equity-to-asset ratio to 10.95% strengthens TrustCo's capital position, providing a buffer against potential economic headwinds. However, the bank's performance in the coming quarters will likely be influenced by the Federal Reserve's interest rate decisions, which could impact deposit costs and margin expansion opportunities.

Executive Snapshot:

• Average Loan portfolio continues to grow:
  • On average, total loans were up $127.0 million or 2.6% for the third quarter 2024 compared to the third quarter 2023

• Continued solid financial results:
  • Key metrics for third quarter 2024:
    • Net income of $12.9 million versus $12.6 million for the second quarter 2024
    • Net interest income of $38.7 million, up from $37.8 million compared to the second quarter of 2024
    • Return on average equity (ROAE) of 7.74% versus 7.76% for the second quarter 2024
      
• Capital continues to grow:
  
  • Consolidated equity to assets increased 6.2% to 10.95% as of September 30, 2024 from 10.31% as of September 30, 2023
  • Book value per share as of September 30, 2024 was $35.19, up from $34.46 compared to June 30, 2024
    

GLENVILLE, N.Y., Oct. 21, 2024 (GLOBE NEWSWIRE) --

TrustCo Bank Corp NY (TrustCo, NASDAQ: TRST) today announced third quarter 2024 net income of $12.9 million or $0.68 diluted earnings per share, compared to net income of $14.7 million or $0.77 diluted earnings per share for the third quarter 2023; and net income of $37.6 million or $1.97 diluted earnings per share for the nine months ended September 30, 2024, compared to net income of $48.9 million or $2.57 diluted earnings per share for the nine months ended September 30, 2023. Average loans increased $127.0 million or 2.6% for the third quarter 2024 over the same period in 2023.   TrustCo was able to increase the balances of home equity lines of credit (HECLs) outstanding through an aggressive campaign to encourage existing customers to utilize their HECLs in place of the higher rates on other products.  The objective was to meet customer needs and encourage increased utilization through existing HECLs.

Overview

Chairman, President, and CEO, Robert J. McCormick said “Hard, consistent work on the fundamentals of banking once again have served the Trustco Bank team well and enabled us to post strong results under challenging circumstances. Our bankers posted one modest success after another – which accumulated into solid performance. We continued to hold the line on demand accounts and capitalized on strong customer relationships which enabled us to direct the flow into competitively-priced CDs, rather than to non-bank investment products. Not having to purchase expensive deposits or pay excessive rates, helped keep interest expense down, contributing to increased net interest income. We have continued to sell home equity products at favorable rates where origination of purchase mortgages lagged due to lack of sales volume. We booked these new loans at higher interest rates, also boosting net interest margin. Once again, loans reached a new all-time high. All of these efforts by our team resulted in net income of $12.9 million for the quarter.”

Details

Average loans were up $127.0 million or 2.6% in the third quarter 2024 over the same period in 2023. Average residential loans and home equity lines of credit, our primary lending focus, were up $50.4 million, or 1.2%, and $60.0 million, or 18.7%, respectively, in the third quarter 2024 over the same period in 2023. Average commercial loans also increased $18.1 million, or 6.9%, in the third quarter 2024 over the same period in 2023. Average deposits were up $15.3 million, or 0.3% for the third quarter 2024 over the same period in 2023. We believe the increase in time deposits compared to the prior year continues to reflect the desire of customers to have additional funds in the safety and security offered by TrustCo’s long history of conservative banking, while earning a competitive interest rate. As we move forward, the objective is to encourage customers to retain these additional funds in the expanded product offerings of Trustco Bank (the “Bank”) through aggressive marketing and product differentiation.

Net interest income was $38.7 million for the third quarter 2024, an increase of $883 thousand, or 2.3%, compared to the prior quarter, driven by loan growth at higher interest rates and lower cost of deposits, partially offset by lower investment earnings and a decrease in interest on federal funds sold and other short-term investments. The net interest margin for the third quarter 2024 was 2.61%, up 8 basis points from 2.53% in the second quarter of 2024. The yield on interest earnings assets increased to 4.11%, up 5 basis points from 4.06% in the second quarter of 2024. The cost of interest bearing liabilities decreased to 1.94% in the third quarter 2024 from 1.97% in the second quarter 2024. The Bank has seen success in retaining deposits while lowering the rates on time deposits, and still being competitive in the markets it serves. The Federal Reserve’s decision regarding whether to cut or hold rates in upcoming meetings will have an effect on the Bank’s ability to continue to manage deposit costs. Further reductions should help margin expansion in future quarters. Non-interest expense decreased $259 thousand over the prior quarter as a result of the Bank’s ongoing efforts to control expenses.

Asset quality remains strong and has been consistent over the past twelve months. The Company recorded a provision for credit losses of $500 thousand in the third quarter of 2024, which is the result of a provision for credit losses on loans of $400 thousand, and provision for credit losses on unfunded commitments of $100 thousand. The ratio of allowance for credit losses on loans to total loans was 0.99% and 0.95% as of September 30, 2024 and 2023, respectively. The allowance for credit losses on loans was $50.0 million at September 30, 2024, compared to $47.2 million at September 30, 2023. Nonperforming loans (NPLs) were $19.4 million at September 30, 2024, compared to $17.9 million at September 30, 2023. NPLs were 0.38% and 0.36% of total loans at September 30, 2024 and 2023, respectively. The coverage ratio, or allowance for credit losses on loans to NPLs, was 256.9% at September 30, 2024, compared to 264.2% at September 30, 2023. Nonperforming assets (NPAs) were $21.9 million at September 30, 2024, compared to $19.1 million at September 30, 2023.  

At September 30, 2024, our equity to asset ratio was 10.95%, compared to 10.31% at September 30, 2023. Book value per share at September 30, 2024 was $35.19, up 7.3% compared to $32.80 a year earlier.

A conference call to discuss third quarter 2024 results will be held at 9:00 a.m. Eastern Time on October 22, 2024. Those wishing to participate in the call may dial toll-free for the United States at 1-833-470-1428, and for Canada at 1-833-950-0062, Access code 034120. A replay of the call will be available for thirty days by dialing toll-free for the United States at 1-866-813-9403, Access code 285814.   The call will also be audio webcast at https://events.q4inc.com/attendee/854762065, and will be available for one year.

About TrustCo Bank Corp NY

TrustCo Bank Corp NY is a $6.1 billion savings and loan holding company and through its subsidiary, Trustco Bank, operated 138 offices in New York, New Jersey, Vermont, Massachusetts, and Florida at September 30, 2024.

In addition, the Bank’s Wealth Management Department offers a full range of investment services, retirement planning and trust and estate administration services. The common shares of TrustCo are traded on the NASDAQ Global Select Market under the symbol TRST.

Forward-Looking Statements

All statements in this news release that are not historical are forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as "anticipate," "intend," "plan," "goal," "seek," "believe," "project," "estimate," "expect," "strategy," "future," "likely," "may," "should," "will" and similar references to future development, results or periods. Examples of forward-looking statements include, among others, statements we make regarding our expectations for our future performance, including our expectations regarding the effects of the economic environment on our financial results, our ability to retain customers and the amount of customers’ business, including deposit balances, with us, the impact of the Federal Reserve’s actions regarding interest rates, and the growth of loans and deposits throughout our branch network. Forward-looking statements are based on management’s current expectations as well as certain assumptions and estimates made by, and information available to, management at the time the statements are made. Such forward-looking statements are subject to factors and uncertainties that could cause actual results to differ materially for TrustCo from the views, beliefs and projections expressed in such statements, and many of the risks and uncertainties are heightened by or may, in the future, be heightened by volatility in financial markets and macroeconomic or geopolitical concerns related to inflation, continued elevated interest rates and ongoing armed conflicts (including the Russia/Ukraine conflict and the conflict in Israel and surrounding areas). TrustCo wishes to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The following important factors, among others, in some cases have affected and in the future could affect TrustCo’s actual results and could cause TrustCo’s actual financial performance to differ materially from that expressed in any forward-looking statement: future changes in interest rates; ongoing inflationary pressures and continued elevated prices; exposure to credit risk in our lending activities; our increasing commercial loan portfolio; the sufficiency of our allowance for credit losses on loans to cover actual loan losses; our ability to meet the cash flow requirements of our depositors or borrowers or meet our operating cash needs to fund corporate expansion and other activities; claims and litigation pertaining to fiduciary responsibility and lender liability; our dependency upon the services of the management team; our disclosure controls and procedures’ ability to prevent or detect errors or acts of fraud; the adequacy of our business continuity and disaster recovery plans; the effectiveness of our risk management framework; the impact of any expansion by us into new lines of business or new products and services; the impact of severe weather events and climate change on us and the communities we serve, including societal responses to climate change; increasing scrutiny and evolving expectations from customers, regulators, investors, and other stakeholders with respect to our environmental, social and governance practices; the chance of a prolonged economic downturn, especially one affecting our geographic market area; instability in global economic conditions and geopolitical matters, as well as volatility in financial markets; the soundness of other financial institutions; U.S. government shutdowns, credit rating downgrades, or failure to increase the debt ceiling; fluctuations in the trust wealth management fees we receive as a result of investment performance; the impact of regulatory capital rules on our growth; changes in laws and regulations, including changes in cybersecurity or privacy regulations; restrictions on data collection and use; our compliance with the USA PATRIOT Act, Bank Secrecy Act, and other laws and regulations that could result in material fines or sanctions; changes in tax laws; limitations on our ability to pay dividends; TrustCo Realty Corp.’s ability to qualify as a real estate investment trust; changes in accounting standards; competition within our market areas; consumers and businesses’ use of non-banks to complete financial transactions; our reliance on third-party service providers; the impact of data breaches and cyber-attacks; the impact of a failure in or breach of our operational or security systems or infrastructure, or those of third parties; the impact of an unauthorized disclosure of sensitive or confidential client or customer information; the impact of interruptions in the effective operation of our computer systems; the impact of anti-takeover provisions in our organizational documents; the impact of the manner in which we allocate capital; and other risks and uncertainties under the heading “Risk Factors” in our most recent annual report on Form 10-K and, if any, in our subsequent quarterly reports on Form 10-Q or other securities filings. The forward-looking statements contained in this news release represent TrustCo management’s judgment as of the date of this news release. TrustCo disclaims, however, any intent or obligation to update forward-looking statements, either as a result of future developments, new information or otherwise, except as may be required by law.

TRUSTCO BANK CORP NY
GLENVILLE, NY
FINANCIAL HIGHLIGHTS
(dollars in thousands, except per share data)
(Unaudited)
		Three months ended
		9/30/2024				6/30/2024				9/30/2023
Summary of operations
Net interest income		$	38,671			$	37,788			$	42,221
Provision for credit losses			500				500				100
Net gains on equity securities			23				1,360				-
Noninterest income, excluding net gains on equity securities			4,908				4,291				4,574
Noninterest expense			26,200				26,459				27,460
Net income			12,875				12,551				14,680
Per share
Net income per share:
- Basic		$	0.68			$	0.66			$	0.77
- Diluted			0.68				0.66				0.77
Cash dividends			0.36				0.36				0.36
Book value at period end			35.19				34.46				32.80
Market price at period end			33.07				28.77				27.29
At period end
Full time equivalent employees			735				753				764
Full service banking offices			138				138				143
Performance ratios
Return on average assets			0.84		%		0.82		%		0.96		%
Return on average equity			7.74				7.76				9.32
Efficiency ratio (1)			59.65				62.84				58.33
Net interest spread			2.17				2.09				2.55
Net interest margin			2.61				2.53				2.85
Dividend payout ratio			53.16				54.57				46.65
Capital ratios at period end
Consolidated equity to assets			10.95		%		10.73		%		10.31		%
Consolidated tangible equity to tangible assets (2)			10.94		%		10.72		%		10.30		%
Asset quality analysis at period end
Nonperforming loans to total loans			0.38		%		0.38		%		0.36		%
Nonperforming assets to total assets			0.36				0.35				0.31
Allowance for credit losses on loans to total loans			0.99				0.99				0.95
Coverage ratio (3)		2.6x				2.6x				2.6x
(1) Non-GAAP measure; calculated as noninterest expense (excluding ORE expense) divided by taxable equivalent net interest income plus noninterest income (excluding net gains on equity securities). See Non-GAAP Financial Measures Reconciliation.
(2) Non-GAAP measure; calculated as total shareholders' equity less $553 of intangible assets divided by total assets less $553 of intangible assets. See Non-GAAP Financial Measures Reconciliation.
(3) Calculated as allowance for credit losses on loans divided by total nonperforming loans.
FINANCIAL HIGHLIGHTS, Continued
(dollars in thousands, except per share data)
(Unaudited)
		Nine Months Ended
		09/30/24				09/30/23
Summary of operations
Net interest income	$		113,037				133,238
Provision (Credit) for credit losses			1,600				(100	)
Net gains on equity securities			1,383				-
Noninterest income, excluding net gains on equity securities			14,042				13,841
Noninterest expense			77,562				82,466
Net income			37,552				48,798
Per share
Net income per share:
- Basic	$		1.97				2.57
- Diluted			1.97				2.57
Cash dividends			1.08				1.08
Book value at period end			35.19				32.80
Market price at period end			33.07				27.29
Performance ratios
Return on average assets			0.82		%		1.08
Return on average equity			7.68				10.57
Efficiency ratio (1)			60.80				55.70
Net interest spread			2.08				2.78
Net interest margin			2.52				3.01
Dividend payout ratio			54.70				42.11
(1) Non-GAAP measure; calculated as noninterest expense (excluding ORE expense) divided by taxable equivalent net interest income plus noninterest income (excluding net gains on equity securities). See Non-GAAP Financial Measures Reconciliation.
CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except per share data)
(Unaudited)
		Three months ended
		9/30/2024				6/30/2024				3/31/2024				12/31/2023				9/30/2023
Interest and dividend income:
Interest and fees on loans		$	52,112			$	50,660			$	49,804			$	49,201			$	47,921
Interest and dividends on securities available for sale:
U. S. government sponsored enterprises			718				909				906				750				672
State and political subdivisions			-				1				-				1				-
Mortgage-backed securities and collateralized mortgage
obligations - residential			1,397				1,451				1,494				1,533				1,485
Corporate bonds			361				362				476				477				473
Small Business Administration - guaranteed
participation securities			90				94				100				102				107
Other securities			2				2				3				3				2
Total interest and dividends on securities available for sale			2,568				2,819				2,979				2,866				2,739
Interest on held to maturity securities:
Mortgage-backed securities and collateralized mortgage
obligations - residential			62				65				68				70				73
Total interest on held to maturity securities			62				65				68				70				73
Federal Home Loan Bank stock			153				147				152				149				131
Interest on federal funds sold and other short-term investments			6,174				6,894				6,750				6,354				6,688
Total interest income			61,069				60,585				59,753				58,640				57,552
Interest expense:
Interest on deposits:
Interest-bearing checking			311				288				240				165				102
Savings			770				675				712				707				639
Money market deposit accounts			2,154				2,228				2,342				2,500				2,384
Time deposits			18,969				19,400				19,677				16,460				11,962
Interest on short-term borrowings			194				206				204				201				244
Total interest expense			22,398				22,797				23,175				20,033				15,331
Net interest income			38,671				37,788				36,578				38,607				42,221
Less: Provision for credit losses			500				500				600				1,350				100
Net interest income after provision for credit losses			38,171				37,288				35,978				37,257				42,121
Noninterest income:
Trustco Financial Services income			2,044				1,609				1,816				1,612				1,627
Fees for services to customers			2,482				2,399				2,745				2,563				2,590
Net gains on equity securities			23				1,360				-				-				-
Other			382				283				282				299				357
Total noninterest income			4,931				5,651				4,843				4,474				4,574
Noninterest expenses:
Salaries and employee benefits			12,134				12,520				11,427				12,444				12,393
Net occupancy expense			4,271				4,375				4,611				4,209				4,358
Equipment expense			1,757				1,990				1,738				1,852				1,923
Professional services			1,863				1,570				1,460				1,561				1,717
Outsourced services			2,551				2,755				2,501				2,532				2,720
Advertising expense			339				466				408				384				586
FDIC and other insurance			1,112				797				1,094				1,085				1,078
Other real estate expense (income), net			204				16				74				(12	)			163
Other			1,969				1,970				1,590				4,776				2,522
Total noninterest expenses			26,200				26,459				24,903				28,831				27,460
Income before taxes			16,902				16,480				15,918				12,900				19,235
Income taxes			4,027				3,929				3,792				3,052				4,555
Net income		$	12,875			$	12,551			$	12,126			$	9,848			$	14,680
Net income per common share:
- Basic		$	0.68			$	0.66			$	0.64			$	0.52			$	0.77
- Diluted			0.68				0.66				0.64				0.52				0.77
Average basic shares (in thousands)			19,010				19,022				19,024				19,024				19,024
Average diluted shares (in thousands)			19,036				19,033				19,032				19,026				19,024
CONSOLIDATED STATEMENTS OF INCOME, Continued
(dollars in thousands, except per share data)
(Unaudited)
		Nine Months Ended
		09/30/24				09/30/23
Interest and dividend income:
Interest and fees on loans	$		152,576				138,255
Interest and dividends on securities available for sale:
U. S. government sponsored enterprises			2,533				2,055
State and political subdivisions			1				1
Mortgage-backed securities and collateralized mortgage
obligations - residential			4,342				4,613
Corporate bonds			1,199				1,510
Small Business Administration - guaranteed
participation securities			284				335
Other securities			7				7
Total interest and dividends on securities available for sale			8,366				8,521
Interest on held to maturity securities:
Mortgage-backed securities-residential			195				226
Total interest on held to maturity securities			195				226
Federal Home Loan Bank stock			452				351
Interest on federal funds sold and other short-term investments			19,818				20,213
Total interest income			181,407				167,566
Interest expense:
Interest on deposits:
Interest-bearing checking			839				217
Savings			2,157				1,824
Money market deposit accounts			6,724				4,954
Time deposits			58,046				26,525
Interest on short-term borrowings			604				808
Total interest expense			68,370				34,328
Net interest income			113,037				133,238
Less: Provision (Credit) for credit losses			1,600				(100	)
Net interest income after provision (credit) for credit losses			111,437				133,338
Noninterest income:
Trustco Financial Services income			5,469				4,813
Fees for services to customers			7,626				8,085
Net gains on equity securities			1,383				-
Other			947				943
Total noninterest income			15,425				13,841
Noninterest expenses:
Salaries and employee benefits			36,081				38,798
Net occupancy expense			13,257				13,218
Equipment expense			5,485				5,758
Professional services			4,893				4,684
Outsourced services			7,807				7,507
Advertising expense			1,213				1,494
FDIC and other insurance			3,003				3,215
Other real estate expense, net			294				536
Other			5,529				7,256
Total noninterest expenses			77,562				82,466
Income before taxes			49,300				64,713
Income taxes			11,748				15,915
Net income	$		37,552				48,798
Net income per common share:
- Basic	$		1.97				2.57
- Diluted			1.97				2.57
Average basic shares (in thousands)			19,019				19,024
Average diluted shares (in thousands)			19,034				19,024
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(dollars in thousands)
(Unaudited)
		9/30/2024				6/30/2024				3/31/2024				12/31/2023				9/30/2023
ASSETS:
Cash and due from banks		$	49,659			$	42,193			$	44,868			$	49,274			$	45,940
Federal funds sold and other short term investments			473,306				493,920				564,815				528,730				461,321
Total cash and cash equivalents			522,965				536,113				609,683				578,004				507,261
Securities available for sale:
U. S. government sponsored enterprises			90,588				106,796				128,854				118,668				121,474
States and political subdivisions			26				26				26				26				34
Mortgage-backed securities and collateralized mortgage
obligations - residential			222,841				218,311				227,078				237,677				233,719
Small Business Administration - guaranteed
participation securities			15,171				15,592				16,260				17,186				17,316
Corporate bonds			54,327				53,764				53,341				78,052				76,935
Other securities			701				688				682				680				657
Total securities available for sale			383,654				395,177				426,241				452,289				450,135
Held to maturity securities:
Mortgage-backed securities and collateralized mortgage
obligations-residential			5,636				5,921				6,206				6,458				6,724
Total held to maturity securities			5,636				5,921				6,206				6,458				6,724
Federal Reserve Bank and Federal Home Loan Bank stock			6,507				6,507				6,203				6,203				6,203
Loans:
Commercial			280,261				282,441				279,092				273,515				268,642
Residential mortgage loans			4,382,674				4,370,640				4,354,369				4,365,063				4,343,006
Home equity line of credit			393,418				370,063				355,879				347,415				332,028
Installment loans			14,503				15,168				16,166				16,886				16,605
Loans, net of deferred net costs			5,070,856				5,038,312				5,005,506				5,002,879				4,960,281
Less: Allowance for credit losses on loans			49,950				49,772				49,220				48,578				47,226
Net loans			5,020,906				4,988,540				4,956,286				4,954,301				4,913,055
Bank premises and equipment, net			33,324				33,466				33,423				34,007				32,135
Operating lease right-of-use assets			37,958				38,376				39,647				40,542				41,475
Other assets			98,730				102,544				101,881				96,387				97,310
Total assets		$	6,109,680			$	6,106,644			$	6,179,570			$	6,168,191			$	6,054,298
LIABILITIES:
Deposits:
Demand		$	753,878			$	745,227			$	742,997			$	754,532			$	773,293
Interest-bearing checking			988,527				1,029,606				1,020,136				1,015,213				1,033,898
Savings accounts			1,092,038				1,144,427				1,155,517				1,179,241				1,235,658
Money market deposit accounts			477,113				517,445				532,611				565,767				610,012
Time deposits			1,952,635				1,840,262				1,903,908				1,836,024				1,581,504
Total deposits			5,264,191				5,276,967				5,355,169				5,350,777				5,234,365
Short-term borrowings			91,450				89,720				94,374				88,990				103,110
Operating lease liabilities			41,469				42,026				43,438				44,471				45,418
Accrued expenses and other liabilities			43,549				42,763				37,399				38,668				47,479
Total liabilities			5,440,659				5,451,476				5,530,380				5,522,906				5,430,372
SHAREHOLDERS' EQUITY:
Capital stock			20,058				20,058				20,058				20,058				20,058
Surplus			257,644				257,490				257,335				257,181				257,078
Undivided profits			442,079				436,048				430,346				425,069				422,082
Accumulated other comprehensive loss, net of tax			(6,600	)			(14,268	)			(14,763	)			(13,237	)			(31,506	)
Treasury stock at cost			(44,160	)			(44,160	)			(43,786	)			(43,786	)			(43,786	)
Total shareholders' equity			669,021				655,168				649,190				645,285				623,926
Total liabilities and shareholders' equity		$	6,109,680			$	6,106,644			$	6,179,570			$	6,168,191			$	6,054,298
Outstanding shares (in thousands)			19,010				19,010				19,024				19,024				19,024

NONPERFORMING ASSETS
(dollars in thousands)
(Unaudited)
		9/30/2024			6/30/2024			3/31/2024			12/31/2023			9/30/2023
Nonperforming Assets
New York and other states*
Loans in nonaccrual status:
Commercial		$	466		$	741		$	532		$	536		$	540
Real estate mortgage - 1 to 4 family			15,320			14,992			14,359			14,375			14,633
Installment			163			131			149			151			93
Total non-accrual loans			15,949			15,864			15,040			15,062			15,266
Other nonperforming real estate mortgages - 1 to 4 family			-			-			-			3			5
Total nonperforming loans			15,949			15,864			15,040			15,065			15,271
Other real estate owned			2,503			2,334			2,334			194			1,185
Total nonperforming assets		$	18,452		$	18,198		$	17,374		$	15,259		$	16,456
Florida
Loans in nonaccrual status:
Commercial		$	314		$	314		$	314		$	314		$	314
Real estate mortgage - 1 to 4 family			3,176			2,985			2,921			2,272			2,228
Installment			5			22			-			15			65
Total non-accrual loans			3,495			3,321			3,235			2,601			2,607
Other nonperforming real estate mortgages - 1 to 4 family			-			-			-			-			-
Total nonperforming loans			3,495			3,321			3,235			2,601			2,607
Other real estate owned			-			-			-			-			-
Total nonperforming assets		$	3,495		$	3,321		$	3,235		$	2,601		$	2,607
Total
Loans in nonaccrual status:
Commercial		$	780		$	1,055		$	846		$	850		$	854
Real estate mortgage - 1 to 4 family			18,496			17,977			17,280			16,647			16,861
Installment			168			153			149			166			158
Total non-accrual loans			19,444			19,185			18,275			17,663			17,873
Other nonperforming real estate mortgages - 1 to 4 family			-			-			-			3			5
Total nonperforming loans			19,444			19,185			18,275			17,666			17,878
Other real estate owned			2,503			2,334			2,334			194			1,185
Total nonperforming assets		$	21,947		$	21,519		$	20,609		$	17,860		$	19,063
Quarterly Net (Recoveries) Chargeoffs
New York and other states*
Commercial		$	65		$	-		$	-		$	-		$	-
Real estate mortgage - 1 to 4 family			104			(74	)		(78	)		219			(26	)
Installment			11			(2	)		36			23			14
Total net (recoveries) chargeoffs		$	180		$	(76	)	$	(42	)	$	242		$	(12	)
Florida
Commercial		$	-		$	-		$	-		$	-		$	-
Real estate mortgage - 1 to 4 family			-			17			-			-			-
Installment			42			7			-			6			-
Total net (recoveries) chargeoffs		$	42		$	24		$	-		$	6		$	-
Total
Commercial		$	65		$	-		$	-		$	-		$	-
Real estate mortgage - 1 to 4 family			104			(57	)		(78	)		219			(26	)
Installment			53			5			36			29			14
Total net (recoveries) chargeoffs		$	222		$	(52	)	$	(42	)	$	248		$	(12	)
Asset Quality Ratios
Total nonperforming loans (1)		$	19,444		$	19,185		$	18,275		$	17,666		$	17,878
Total nonperforming assets (1)			21,947			21,519			20,609			17,860			19,063
Total net (recoveries) chargeoffs (2)			222			(52	)		(42	)		248			(12	)
Allowance for credit losses on loans (1)			49,950			49,772			49,220			48,578			47,226
Nonperforming loans to total loans			0.38	%		0.38	%		0.37	%		0.35	%		0.36	%
Nonperforming assets to total assets			0.36	%		0.35	%		0.33	%		0.29	%		0.31	%
Allowance for credit losses on loans to total loans			0.99	%		0.99	%		0.98	%		0.97	%		0.95	%
Coverage ratio (1)			256.9	%		259.4	%		269.3	%		275.0	%		264.2	%
Annualized net (recoveries) chargeoffs to average loans (2)			0.02	%		0.00	%		0.00	%		0.02	%		0.00	%
Allowance for credit losses on loans to annualized net chargeoffs (2)		56.3x			N/A			N/A			49.0x			N/A
* Includes New York, New Jersey, Vermont and Massachusetts.
(1) At period-end
(2) For the three-month period ended

DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY -
INTEREST RATES AND INTEREST DIFFERENTIAL
(dollars in thousands)
(Unaudited)		Three months ended									Three months ended
		September 30, 2024									September 30, 2023
		Average				Interest		Average			Average				Interest		Average
		Balance						Rate			Balance						Rate
Assets
Securities available for sale:
U. S. government sponsored enterprises		$	95,073			$	718	3.02	%		$	119,406			$	672	2.25	%
Mortgage backed securities and collateralized mortgage
obligations - residential			241,792				1,397	2.29				269,535				1,485	2.19
State and political subdivisions			26				-	6.75				34				-	6.74
Corporate bonds			55,041				361	2.63				80,331				473	2.36
Small Business Administration - guaranteed
participation securities			16,663				90	2.15				19,801				107	2.15
Other			701				2	1.14				686				2	1.17
Total securities available for sale			409,296				2,568	2.51				489,793				2,739	2.24
Federal funds sold and other short-term Investments			465,922				6,174	5.27				494,597				6,688	5.37
Held to maturity securities:
Mortgage backed securities and collateralized mortgage
obligations - residential			5,779				62	4.29				6,877				73	4.22
Total held to maturity securities			5,779				62	4.29				6,877				73	4.22
Federal Home Loan Bank stock			6,507				153	9.41				6,203				131	8.45
Commercial loans			279,199				3,807	5.45				261,061				3,398	5.21
Residential mortgage loans			4,375,641				41,811	3.82				4,325,219				39,321	3.64
Home equity lines of credit			380,422				6,245	6.53				320,446				4,946	6.12
Installment loans			14,443				249	6.87				15,959				256	6.37
Loans, net of unearned income			5,049,705				52,112	4.12				4,922,685				47,921	3.89
Total interest earning assets			5,937,209			$	61,069	4.11				5,920,155			$	57,552	3.88
Allowance for credit losses on loans			(49,973	)								(47,077	)
Cash & non-interest earning assets			187,166									172,523
Total assets		$	6,074,402								$	6,045,601
Liabilities and shareholders' equity
Deposits:
Interest bearing checking accounts		$	1,000,333			$	311	0.12	%		$	1,050,313			$	102	0.04	%
Money market accounts			499,408				2,154	1.72				625,031				2,384	1.51
Savings			1,122,673				770	0.27				1,282,641				639	0.20
Time deposits			1,880,021				18,969	4.01				1,494,402				11,962	3.18
Total interest bearing deposits			4,502,435				22,204	1.96				4,452,387				15,087	1.34
Short-term borrowings			87,677				194	0.88				110,018				244	0.88
Total interest bearing liabilities			4,590,112			$	22,398	1.94				4,562,405			$	15,331	1.33
Demand deposits			742,164									776,885
Other liabilities			80,502									81,411
Shareholders' equity			661,624									624,900
Total liabilities and shareholders' equity		$	6,074,402								$	6,045,601
Net interest income, GAAP and non-GAAP tax equivalent (1)						$	38,671								$	42,221
Net interest spread, GAAP and non-GAAP tax equivalent (1)								2.17	%								2.55	%
Net interest margin (net interest income to
total interest earning assets), GAAP and non-GAAP tax equivalent (1)								2.61	%								2.85	%
Tax equivalent adjustment (1)							-									-
Net interest income						$	38,671								$	42,221
(1) Tax equivalent adjustment to a measure results in a non-GAAP financial measure. See Non-GAAP Financial Measures Reconciliation.
DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY -
INTEREST RATES AND INTEREST DIFFERENTIAL, Continued
(dollars in thousands)
(Unaudited)		Nine Months Ended									Nine Months Ended
		September 30, 2024									September 30, 2023
		Average				Interest		Average			Average				Interest		Average
		Balance						Rate			Balance						Rate
Assets
Securities available for sale:
U. S. government sponsored enterprises	$		111,570				2,533	3.03	%	$		120,243				2,055	2.28	%
Mortgage backed securities and collateralized mortgage
obligations - residential			250,343				4,342	2.31				278,252				4,613	2.21
State and political subdivisions			26				1	6.80				34				1	6.74
Corporate bonds			61,221				1,199	2.61				83,732				1,510	2.41
Small Business Administration - guaranteed
participation securities			17,438				284	2.17				20,876				335	2.14
Other			697				7	1.34				686				7	1.02
Total securities available for sale			441,295				8,366	2.53				503,823				8,521	1.69
Federal funds sold and other short-term Investments			489,934				19,818	5.40				540,570				20,213	5.00
Held to maturity securities:
Mortgage backed securities and collateralized mortgage
obligations - residential			6,053				195	4.29				7,205				226	4.18
Total held to maturity securities			6,053				195	4.29				7,205				226	4.18
Federal Home Loan Bank stock			6,350				452	9.49				5,957				351	5.89
Commercial loans			278,981				11,232	5.37				249,738				9,716	5.19
Residential mortgage loans			4,364,821				123,046	3.76				4,269,494				114,227	3.57
Home equity lines of credit			365,932				17,522	6.40				305,075				13,598	5.96
Installment loans			15,319				776	6.76				15,015				714	6.35
Loans, net of unearned income			5,025,053				152,576	4.05				4,839,322				138,255	3.81
Total interest earning assets			5,968,685				181,407	4.05				5,896,877				167,566	3.79
Allowance for credit losses on loans			(49,419	)								(46,812	)
Cash & non-interest earning assets			187,963									173,521
Total assets	$		6,107,229							$		6,023,586
Liabilities and shareholders' equity
Deposits:
Interest bearing checking accounts	$		999,839				839	0.11	%	$		1,088,859				217	0.03	%
Money market accounts			522,636				6,724	1.72				613,119				4,954	1.08
Savings			1,142,313				2,157	0.25				1,363,052				1,824	0.18
Time deposits			1,881,027				58,046	4.12				1,343,762				26,525	2.64
Total interest bearing deposits			4,545,815				67,766	1.99				4,408,792				33,520	1.02
Short-term borrowings			91,551				604	0.88				121,911				808	0.89
Total interest bearing liabilities			4,637,366				68,370	1.97				4,530,703				34,328	1.01
Demand deposits			734,604									793,890
Other liabilities			82,233									81,771
Shareholders' equity			653,026									617,224
Total liabilities and shareholders' equity	$		6,107,229							$		6,023,588
Net interest income, GAAP and non-GAAP tax equivalent (1)							113,037									133,238
Net interest spread, GAAP and non-GAAP tax equivalent (1)								2.08	%								2.78	%
Net interest margin (net interest income to
total interest earning assets), GAAP and non-GAAP tax equivalent (1)								2.52	%								3.01	%
Tax equivalent adjustment (1)							-									-
Net interest income							113,037									133,238
(1) Tax equivalent adjustment to a measure results in a non-GAAP financial measure. See Non-GAAP Financial Measures Reconciliation.

Non-GAAP Financial Measures Reconciliation

Tangible book value per share is a non-GAAP financial measure derived from GAAP-based amounts. We calculate tangible book value by excluding the balance of intangible assets from total shareholders’ equity divided by shares outstanding. We believe that this is consistent with the treatment by bank regulatory agencies, which exclude intangible assets from the calculation of risk-based capital ratios. Additionally, we believe that this measure is important to many investors in the marketplace who are interested in relative changes from period to period in equity exclusive of changes in intangible assets.

Tangible equity as a percentage of tangible assets at period end is a non-GAAP financial measure derived from GAAP-based amounts. We calculate tangible equity and tangible assets by excluding the balance of intangible assets from total shareholders’ equity and total assets, respectively. We calculate tangible equity as a percentage of tangible assets at period end by dividing tangible equity by tangible assets at period end. We believe that this is consistent with the treatment by bank regulatory agencies, which exclude intangible assets from the calculation of risk-based capital ratios. Additionally, we believe that this measure is important to many investors in the marketplace who are interested in relative changes from period to period in equity and total assets, each exclusive of changes in intangible assets.

Net interest income is commonly presented on a taxable equivalent basis. That is, to the extent that some component of the institution’s net interest income will be exempt from taxation (e.g., was received by the institution as a result of its holdings of state or municipal obligations), an amount equal to the tax benefit derived from that component is added back to the net interest income total. Management considers this adjustment helpful to investors in comparing one financial institution’s net interest income (pre- tax) to that of another institution, as each will have a different proportion of tax-exempt items in their portfolios. Moreover, net interest income is itself a component of another financial measure commonly used by financial institutions, net interest margin, which is the ratio of net interest income to average interest earning assets. Additionally, management and many financial institutions also present net interest spread, which is the average yield on interest earning assets minus the average rate paid on interest bearing liabilities. For purposes of these measures as well, taxable equivalent net interest income is generally used by financial institutions, again to provide investors with a better basis of comparison from institution to institution. We calculate taxable equivalent net interest margin by dividing net interest income, adjusted to include the benefit of non-taxable interest income, by average interest earning assets. We calculate taxable equivalent net interest spread as the difference between average yield on interest earning assets, adjusted to include the benefit of non-taxable interest income, and the average rate paid on interest bearing liabilities.

The efficiency ratio is a non-GAAP measure of expense control relative to revenue from net interest income and non-interest fee income. We calculate the efficiency ratio by dividing total noninterest expenses as determined under GAAP, excluding other real estate expense, net, by net interest income (fully taxable equivalent) and total noninterest income as determined under GAAP, excluding net gains on equity securities. We believe that this provides a reasonable measure of primary banking expenses relative to primary banking revenue. Additionally, we believe this measure is important to investors looking for a measure of efficiency in our productivity measured by the amount of revenue generated for each dollar spent.

We believe that these non-GAAP financial measures provide information that is important to investors and that is useful in understanding our financial results. Our management internally assesses our performance based, in part, on these measures. However, these non-GAAP financial measures are supplemental and not a substitute for an analysis based on GAAP measures. As other companies may use different calculations for these measures, this presentation may not be comparable to other similarly titled measures reported by other companies. A reconciliation of the non-GAAP measures of tangible equity as a percentage of tangible assets, and efficiency ratio to the most directly comparable GAAP measures is set forth below. We have not presented a reconciliation of taxable equivalent net interest income, taxable equivalent net interest margin or taxable equivalent net interest spread to the most directly comparable GAAP measure, as there was no difference between the taxable equivalent measure and comparable GAAP measure for any period presented in this release.

NON-GAAP FINANCIAL MEASURES RECONCILIATION
(dollars in thousands)
(Unaudited)
		9/30/2024			6/30/2024			9/30/2023
Tangible Book Value Per Share
Equity (GAAP)		$	669,021		$	655,168		$	623,926
Less: Intangible assets			553			553			553
Tangible equity (Non-GAAP)		$	668,468		$	654,615		$	623,373
Shares outstanding			19,010			19,010			19,024
Tangible book value per share			35.16			34.44			32.77
Book value per share			35.19			34.46			32.80
Tangible Equity to Tangible Assets
Total Assets (GAAP)		$	6,109,680		$	6,106,644		$	6,054,298
Less: Intangible assets			553			553			553
Tangible assets (Non-GAAP)		$	6,109,127		$	6,106,091		$	6,053,745
Tangible Equity to Tangible Assets (Non-GAAP)			10.94	%		10.72	%		10.30	%
Equity to Assets (GAAP)			10.95	%		10.73	%		10.31	%
		Three months ended										Nine Months Ended
Efficiency Ratio		9/30/2024			6/30/2024			9/30/2023				9/30/2024			9/30/2023
Net interest income (GAAP)		$	38,671		$	37,788		$	42,221			$	113,037		$	133,238
Taxable equivalent adjustment			-			-			-				-			-
Net interest income (fully taxable equivalent) (Non-GAAP)			38,671			37,788			42,221				113,037			133,238
Non-interest income (GAAP)			4,931			5,651			4,574				15,425			13,841
Less: Net gains on equity securities			23			1,360			-				1,383			-
Revenue used for efficiency ratio (Non-GAAP)		$	43,579		$	42,079		$	46,795			$	127,079		$	147,079
Total noninterest expense (GAAP)		$	26,200		$	26,459		$	27,460			$	77,562		$	82,466
Less: Other real estate expense, net			204			16			163				294			536
Expense used for efficiency ratio (Non-GAAP)		$	25,996		$	26,443		$	27,297			$	77,268		$	81,930
Efficiency Ratio			59.65	%		62.84	%		58.33	%			60.80	%		55.70	%

Subsidiary:	Trustco Bank
Contact:	Robert Leonard Executive Vice President (518) 381-3693

FAQ

What was TrustCo's (TRST) net income for Q3 2024?

TrustCo Bank Corp NY (TRST) reported a net income of $12.9 million for the third quarter of 2024.

How did TrustCo's (TRST) average loan portfolio perform in Q3 2024?

TrustCo's average loan portfolio grew by $127.0 million or 2.6% in the third quarter of 2024 compared to the same period in 2023.

What was TrustCo's (TRST) net interest margin in Q3 2024?

TrustCo's net interest margin for the third quarter of 2024 was 2.61%, up 8 basis points from 2.53% in the second quarter of 2024.

How did TrustCo's (TRST) book value per share change in Q3 2024?

TrustCo's book value per share increased to $35.19 as of September 30, 2024, up 7.3% from $32.80 a year earlier.