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GLENS FALLS, N.Y., July 23, 2026 /PRNewswire/ -- Arrow Financial Corporation (NasdaqGS® – AROW) ("Arrow" or the "Company") announced financial results for the three-month period ended June 30, 2026. Reported net income for the second quarter of 2026 was $11.0 million and fully diluted earnings per share ("EPS") was $0.66, versus net income of $13.5 million and EPS of $0.82 for the first quarter of 2026.
The Board of Directors of Arrow declared a quarterly cash dividend of $0.30 per share; payable August 25, 2026 to shareholders of record as of August 11, 2026.
This quarter's results include approximately $1.0 million ($0.05 per share) of merger-related expenses related to the July 1, 2026 acquisition of Adirondack Bancorp, Inc. and Adirondack Bank based in Utica, New York. Excluding the merger-related expenses, Arrow achieved EPS of $0.71 for the second quarter of 2026. The transaction added approximately $1.0 billion in assets and 19 new branch locations.
Second-quarter results were impacted by a specific reserve of $1.6 million ($0.08 per share) for an isolated commercial real estate credit due to a sudden personal and corporate bankruptcy declared in June 2026 (for more details on this credit, please refer to our Second Quarter Investor Presentation), as well as an elevated loan provision due to strong loan growth.
This earnings release and related commentary should be read in conjunction with the Company's July 23, 2026 Form 8-K and related Second Quarter 2026 Investor Presentation, which can also be found on Arrow's website: arrowfinancial.com/documents/investor-presentations.
Arrow President and CEO David S. DeMarco:
"The Arrow team delivered another quarter of strong operating results. While our results were negatively impacted by recognizing a reserve on one isolated commercial credit, the credit metrics of the loan portfolio remain strong with low charge-offs and low non-performing loan balances. The overall health and trajectory of the business continues to perform well. I am particularly excited about the return to significant loan growth and the closing of our acquisition of Adirondack Bank, which will provide us with increased growth opportunities. We look forward to expanding our market with this high-quality, low-cost deposit franchise, adding approximately $1.0 billion to our balance sheet. We expect the transaction to provide significant EPS accretion in 2027 and beyond. Arrow remains well-positioned to deliver shareholder value and execute on its strategic initiatives to build a premier banking franchise for its customers and the communities it serves."
Second-Quarter Highlights and Key Metrics
Income Statement
Three Months Ended | |||||
(Dollars in Thousands) | |||||
June 30, 2026 | December 31, 2025 | June 30, 2025 | |||
Interest and Dividend Income | $ 53,617 | $ 54,610 | $ 51,573 | ||
Interest Expense | 17,686 | 19,467 | 19,040 | ||
Net Interest Income | 35,931 | 35,143 | 32,533 | ||
Average Earning Assets(A) | 4,211,209 | 4,302,305 | 4,142,993 | ||
Average Interest-Bearing Liabilities | 3,222,939 | 3,280,856 | 3,191,906 | ||
Average Yield on Earning Assets(A) | 5.11 % | 5.04 % | 4.99 % | ||
Average Cost of Interest-Bearing Liabilities | 2.20 | 2.35 | 2.39 | ||
Net Interest Spread | 2.91 | 2.69 | 2.60 | ||
Net Interest Margin | 3.42 | 3.24 | 3.15 | ||
Net Interest Margin - FTE | 3.43 | 3.25 | 3.16 | ||
(A) Includes Nonaccrual Loans. | |||||
Balance Sheet
Additional Commentary
About Arrow: Arrow Financial Corporation is a holding company headquartered in Glens Falls, New York, serving the financial needs of northeastern New York. The Company is the parent of Arrow Bank, a full-service commercial bank, and Upstate Agency, LLC, a comprehensive insurance agency.
Non-GAAP Financial Measures Reconciliation: In addition to presenting information in conformity with accounting principles generally accepted in the United States of America (GAAP), this news release contains financial information determined by methods other than GAAP (non-GAAP). The following measures used in this release, which are commonly utilized by financial institutions, have not been specifically exempted by the Securities and Exchange Commission ("SEC") and may constitute "non-GAAP financial measures" within the meaning of the SEC's rules: tangible book value, tangible equity, return on tangible equity, tax-equivalent adjustment and related net interest income, tax-equivalent net interest margin and the efficiency ratio. Management believes that the non-GAAP financial measures disclosed by Arrow from time to time are useful in evaluating Arrow's performance and that such information should be considered as supplemental in nature and not as a substitute for or superior to the related financial information prepared in accordance with GAAP. Non-GAAP financial measures may differ from similar measures presented by other companies. See the reconciliation of GAAP to non-GAAP measures in the section "Selected Quarterly Information."
Safe Harbor Statement: The information contained in this earnings release may contain statements that are not historical in nature but rather are based on management's beliefs, assumptions, expectations, estimates and projections about the future. These statements can sometimes be identified by Arrow's use of forward-looking words such as "may," "will," "anticipate," "estimate," "expect," or "intend." These statements may be "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, involving a degree of uncertainty and attendant risk. In the case of all forward-looking statements, actual outcomes and results may differ materially from what the statements predict or forecast, explicitly or by implication because of various factors, including changes in economic conditions or interest rates, credit risk, inflation, tariffs, cybersecurity risks, changes in FDIC assessments, bank failures, geopolitical events, difficulties in managing Arrow's growth, competition, changes in law or the regulatory environment, risks relating to the integration of Adirondack Bancorp, Inc. and Adirondack Bank, and changes in general business and economic trends. Arrow undertakes no obligation to revise or update these forward-looking statements to reflect the occurrence of unanticipated events. This earnings release should be read in conjunction with Arrow's Annual Report on Form 10-K for the year ended December 31, 2025, and other filings with the SEC.
1 EPS, efficiency ratio and ROA excluding merger-related expenses are non-GAAP measures. See reconciliation in Note 5 to the Selected Quarterly Information | |||
2 FTE Net interest margin is a non-GAAP measure. See reconciliation on Note 2 to the Selected Quarterly Information | |||
3 Retail deposits exclude wholesale funding sources | |||
ARROW FINANCIAL CORPORATION AND SUBSIDIARIES | ||||||||
CONSOLIDATED STATEMENTS OF INCOME | ||||||||
(In Thousands, Except Per Share Amounts - Unaudited) | ||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||
2026 | 2025 | 2026 | 2025 | |||||
INTEREST AND DIVIDEND INCOME | ||||||||
Interest and Fees on Loans | $ 47,181 | $ 45,600 | $ 94,307 | $ 90,150 | ||||
Interest on Deposits at Banks | 1,200 | 1,622 | 2,875 | 3,243 | ||||
Interest and Dividends on Investment Securities: | ||||||||
Fully Taxable | 4,717 | 3,790 | 9,246 | 7,398 | ||||
Exempt from Federal Taxes | 519 | 561 | 983 | 1,148 | ||||
Total Interest and Dividend Income | 53,617 | 51,573 | 107,411 | 101,939 | ||||
INTEREST EXPENSE | ||||||||
Interest-Bearing Checking Accounts | 2,162 | 1,941 | 4,262 | 3,744 | ||||
Savings Deposits | 8,933 | 9,367 | 17,649 | 18,850 | ||||
Time Deposits over $250,000 | 1,052 | 1,726 | 2,248 | 3,537 | ||||
Other Time Deposits | 4,304 | 5,793 | 9,740 | 11,322 | ||||
Borrowings | 1,019 | — | 1,019 | 167 | ||||
Junior Subordinated Obligations Issued to Unconsolidated Subsidiary Trusts | 171 | 171 | 340 | 340 | ||||
Interest on Financing Leases | 45 | 42 | 92 | 89 | ||||
Total Interest Expense | 17,686 | 19,040 | 35,350 | 38,049 | ||||
NET INTEREST INCOME | 35,931 | 32,533 | 72,061 | 63,890 | ||||
Provision for Credit Losses | 2,827 | 594 | 3,375 | 5,613 | ||||
NET INTEREST INCOME AFTER PROVISION FOR | 33,104 | 31,939 | 68,686 | 58,277 | ||||
NON-INTEREST INCOME | ||||||||
Income From Fiduciary Activities | 2,706 | 2,398 | 5,419 | 4,933 | ||||
Fees for Other Services to Customers | 2,969 | 2,787 | 5,696 | 5,387 | ||||
Insurance Commissions | 1,974 | 1,804 | 4,087 | 3,630 | ||||
Net Gain (Loss) on Securities | 155 | (40) | 300 | 277 | ||||
Net Gain on Sales of Loans | 154 | 213 | 444 | 314 | ||||
Other Operating Income | 298 | 447 | 938 | 907 | ||||
Total Non-Interest Income | 8,256 | 7,609 | 16,884 | 15,448 | ||||
NON-INTEREST EXPENSE | ||||||||
Salaries and Employee Benefits | 15,097 | 14,086 | 30,019 | 27,641 | ||||
Occupancy Expenses, Net | 2,101 | 1,952 | 4,560 | 3,974 | ||||
Technology and Equipment Expense | 4,757 | 5,589 | 9,809 | 10,676 | ||||
FDIC Assessments | 441 | 649 | 1,026 | 1,319 | ||||
Other Operating Expense | 5,068 | 3,376 | 8,915 | 8,087 | ||||
Total Non-Interest Expense | 27,464 | 25,652 | 54,329 | 51,697 | ||||
INCOME BEFORE PROVISION FOR INCOME TAXES | 13,896 | 13,896 | 31,241 | 22,028 | ||||
Provision for Income Taxes | 2,934 | 3,091 | 6,794 | 4,913 | ||||
NET INCOME | $ 10,962 | $ 10,805 | $ 24,447 | $ 17,115 | ||||
Average Shares Outstanding: | ||||||||
Basic | 16,428 | 16,545 | 16,408 | 16,611 | ||||
Diluted | 16,467 | 16,551 | 16,438 | 16,618 | ||||
Per Common Share: | ||||||||
Basic Earnings | $ 0.66 | $ 0.65 | $ 1.48 | $ 1.03 | ||||
Diluted Earnings | 0.66 | 0.65 | 1.48 | 1.03 | ||||
ARROW FINANCIAL CORPORATION AND SUBSIDIARIES | |||
CONSOLIDATED BALANCE SHEETS | |||
(In Thousands, Except Share and Per Share Amounts - Unaudited) | |||
June 30, 2026 | December 31, 2025 | ||
ASSETS | |||
Cash and Due From Banks | $ 30,881 | $ 29,132 | |
Interest-Earning Deposits at Banks | 155,907 | 185,051 | |
Investment Securities: | |||
Available-for-Sale at Fair Value | 498,202 | 495,868 | |
Held-to-Maturity (Fair Value of $65,270 at June 30, 2026 and | 65,490 | 66,975 | |
Equity Securities | 5,897 | 5,597 | |
Other Investments | 18,351 | 4,372 | |
Loans | 3,496,541 | 3,453,093 | |
Allowance for Credit Losses | (36,183) | (34,322) | |
Net Loans | 3,460,358 | 3,418,771 | |
Premises and Equipment, Net | 62,530 | 59,433 | |
Goodwill | 23,789 | 23,789 | |
Other Intangible Assets, Net | 1,612 | 1,741 | |
Other Assets | 159,342 | 155,133 | |
Total Assets | $ 4,482,359 | $ 4,445,862 | |
LIABILITIES | |||
Noninterest-Bearing Deposits | 736,087 | 722,374 | |
Interest-Bearing Checking Accounts | 871,965 | 862,192 | |
Savings Deposits | 1,590,680 | 1,557,638 | |
Time Deposits over $250,000 | 132,350 | 155,802 | |
Other Time Deposits | 324,123 | 641,463 | |
Total Deposits | 3,655,205 | 3,939,469 | |
Borrowings | 310,190 | 4,265 | |
Junior Subordinated Obligations Issued to Unconsolidated Subsidiary Trusts | 20,000 | 20,000 | |
Finance Leases | 4,887 | 4,929 | |
Other Liabilities | 45,771 | 45,347 | |
Total Liabilities | 4,036,053 | 4,014,010 | |
STOCKHOLDERS' EQUITY | |||
Preferred Stock, $1 Par Value; 1,000,000 Shares Authorized | — | — | |
Common Stock, $1 Par Value: 30,000,000 Shares Authorized; | 22,067 | 22,067 | |
Additional Paid-in Capital | 415,357 | 414,506 | |
Retained Earnings | 116,806 | 102,271 | |
Accumulated Other Comprehensive Loss | (5,390) | (4,037) | |
Treasury Stock, at Cost (5,521,389 Shares at June 30, 2026 | (102,534) | (102,955) | |
Total Stockholders' Equity | 446,306 | 431,852 | |
Total Liabilities and Stockholders' Equity | $ 4,482,359 | $ 4,445,862 | |
Arrow Financial Corporation | |||||||||
Selected Quarterly Information | |||||||||
(Dollars In Thousands, Except Per Share Amounts - Unaudited) | |||||||||
Quarter Ended | 6/30/2026 | 3/31/2026 | 12/31/2025 | 9/30/2025 | 6/30/2025 | ||||
Net Income | $ 10,962 | $ 13,485 | $ 14,013 | $ 12,825 | $ 10,805 | ||||
Share and Per Share Data: | |||||||||
Period End Shares Outstanding | 16,545 | 16,527 | 16,445 | 16,438 | 16,484 | ||||
Basic Average Shares Outstanding | 16,428 | 16,382 | 16,390 | 16,402 | 16,545 | ||||
Diluted Average Shares Outstanding | 16,467 | 16,403 | 16,413 | 16,406 | 16,551 | ||||
Basic Earnings Per Share | $ 0.66 | $ 0.82 | $ 0.85 | $ 0.77 | $ 0.65 | ||||
Diluted Earnings Per Share | 0.66 | 0.82 | 0.85 | 0.77 | 0.65 | ||||
Cash Dividend Per Share | 0.30 | 0.30 | 0.29 | 0.29 | 0.28 | ||||
Selected Quarterly Average Balances: | |||||||||
Interest-Earning Deposits at Banks | $ 129,628 | $ 183,252 | $ 260,806 | $ 200,251 | $ 145,473 | ||||
Investment Securities | 614,771 | 598,817 | 596,994 | 574,080 | 582,380 | ||||
Loans | 3,466,810 | 3,440,505 | 3,444,505 | 3,424,784 | 3,415,140 | ||||
Deposits | 3,788,961 | 3,928,761 | 4,002,221 | 3,913,721 | 3,849,093 | ||||
Other Borrowed Funds | 149,307 | 29,181 | 29,203 | 30,539 | 33,579 | ||||
Stockholders' Equity | 445,887 | 438,846 | 425,042 | 413,058 | 406,529 | ||||
Total Assets | 4,425,821 | 4,439,833 | 4,499,195 | 4,399,815 | 4,332,339 | ||||
Return on Average Assets, annualized | 0.99 % | 1.23 % | 1.24 % | 1.16 % | 1.00 % | ||||
Return on Average Equity, annualized | 9.86 % | 12.46 % | 13.08 % | 12.32 % | 10.66 % | ||||
Return on Average Tangible Equity, annualized 1 | 10.46 % | 13.23 % | 13.92 % | 13.13 % | 11.38 % | ||||
Average Earning Assets | $ 4,211,209 | $ 4,222,574 | $ 4,302,305 | $ 4,199,115 | $ 4,142,993 | ||||
Average Paying Liabilities | 3,222,939 | 3,244,709 | 3,280,856 | 3,193,789 | 3,191,906 | ||||
Interest Income | 53,617 | 53,794 | 54,610 | 53,598 | 51,573 | ||||
Tax-Equivalent Adjustment 2 | 133 | 123 | 114 | 121 | 148 | ||||
Interest Income, Tax-Equivalent 2 | 53,750 | 53,917 | 54,724 | 53,719 | 51,721 | ||||
Interest Expense | 17,686 | 17,664 | 19,467 | 19,467 | 19,040 | ||||
Net Interest Income | 35,931 | 36,130 | 35,143 | 34,131 | 32,533 | ||||
Net Interest Income, Tax-Equivalent 2 | 36,064 | 36,253 | 35,258 | 34,252 | 32,681 | ||||
Net Interest Margin, annualized | 3.42 % | 3.47 % | 3.24 % | 3.22 % | 3.15 % | ||||
Net Interest Margin, Tax-Equivalent, annualized 2 | 3.43 % | 3.48 % | 3.25 % | 3.24 % | 3.16 % | ||||
Efficiency Ratio Calculation: 3 | |||||||||
Non-Interest Expense | $ 27,464 | $ 26,865 | $ 25,804 | $ 25,433 | $ 25,652 | ||||
Less: Intangible Asset Amortization | 71 | 72 | 74 | 76 | 80 | ||||
Net Non-Interest Expense | $ 27,393 | $ 26,793 | $ 25,730 | $ 25,357 | $ 25,572 | ||||
Net Interest Income, Tax-Equivalent | $ 36,064 | $ 36,253 | $ 35,257 | $ 34,252 | $ 32,681 | ||||
Non-Interest Income | 8,256 | 8,628 | 8,268 | 8,716 | 7,609 | ||||
Less: Net Gain (Loss) on Securities | 155 | 145 | (127) | 392 | (40) | ||||
Net Gross Income | $ 44,165 | $ 44,736 | $ 43,652 | $ 42,576 | $ 40,330 | ||||
Efficiency Ratio | 62.02 % | 59.89 % | 58.94 % | 59.56 % | 63.41 % | ||||
Period-End Capital Information: | |||||||||
Total Stockholders' Equity (i.e. Book Value) | $ 446,306 | $ 440,143 | $ 431,852 | $ 417,687 | $ 408,506 | ||||
Book Value per Share | 26.98 | 26.63 | 26.26 | 25.41 | 24.78 | ||||
Goodwill and Other Intangible Assets, net | 25,401 | 25,481 | 25,530 | 25,594 | 25,659 | ||||
Tangible Book Value per Share 1 | 25.44 | 25.09 | 24.71 | 23.85 | 23.23 | ||||
Capital Ratios:4 | |||||||||
Tier 1 Leverage Ratio | 10.19 % | 10.02 % | 9.68 % | 9.66 % | 9.64 % | ||||
Common Equity Tier 1 Capital Ratio | 13.21 % | 13.30 % | 13.01 % | 13.07 % | 12.73 % | ||||
Tier 1 Risk-Based Capital Ratio | 13.83 % | 13.93 % | 13.64 % | 13.71 % | 13.37 % | ||||
Total Risk-Based Capital Ratio | 14.98 % | 15.04 % | 14.76 % | 14.86 % | 14.51 % | ||||
Arrow Financial Corporation | ||||||||||||
Selected Quarterly Information | ||||||||||||
(Dollars In Thousands, Except Per Share Amounts - Unaudited) | ||||||||||||
Footnotes: | ||||||||||||
1. | Non-GAAP Financial Measure Reconciliation: Tangible Book Value, Tangible Equity, and Return on Tangible Equity exclude | |||||||||||
6/30/2026 | 3/31/2026 | 12/31/2025 | 9/30/2025 | 6/30/2025 | ||||||||
Total Stockholders' Equity (GAAP) | $ 446,306 | $ 440,143 | $ 431,852 | $ 417,687 | $ 408,506 | |||||||
Less: Goodwill and Other Intangible assets, net | 25,401 | 25,481 | 25,530 | 25,594 | 25,659 | |||||||
Tangible Equity (Non-GAAP) | $ 420,905 | $ 414,662 | $ 406,322 | $ 392,093 | $ 382,847 | |||||||
Period End Shares Outstanding | 16,545 | 16,527 | 16,445 | 16,438 | 16,484 | |||||||
Tangible Book Value per Share (Non-GAAP) | $ 25.44 | $ 25.09 | $ 24.71 | $ 23.85 | $ 23.23 | |||||||
Net Income | 10,962 | 13,485 | 14,013 | 12,825 | 10,805 | |||||||
Return on Tangible Equity (Net Income/Tangible | 10.46 % | 13.23 % | 13.92 % | 13.13 % | 11.38 % | |||||||
2. | Non-GAAP Financial Measure Reconciliation: Net Interest Margin is the ratio of annualized tax-equivalent net interest income to | |||||||||||
6/30/2026 | 3/31/2026 | 12/31/2025 | 9/30/2025 | 6/30/2025 | ||||||||
Interest Income (GAAP) | $ 53,617 | $ 53,794 | $ 54,610 | $ 53,598 | $ 51,573 | |||||||
Add: Tax-Equivalent adjustment (Non-GAAP) | 133 | 123 | 114 | 121 | 148 | |||||||
Interest Income - Tax Equivalent (Non-GAAP) | $ 53,750 | $ 53,917 | $ 54,724 | $ 53,719 | $ 51,721 | |||||||
Net Interest Income (GAAP) | $ 35,931 | $ 36,130 | $ 35,143 | $ 34,131 | $ 32,533 | |||||||
Add: Tax-Equivalent adjustment (Non-GAAP) | 133 | 123 | 114 | 121 | 148 | |||||||
Net Interest Income - Tax Equivalent (Non-GAAP) | $ 36,064 | $ 36,253 | $ 35,257 | $ 34,252 | $ 32,681 | |||||||
Average Earning Assets | $ 4,211,209 | $ 4,222,574 | $ 4,302,305 | $ 4,199,115 | $ 4,142,993 | |||||||
Net Interest Margin (Non-GAAP)* | 3.43 % | 3.48 % | 3.25 % | 3.24 % | 3.16 % | |||||||
3. | Non-GAAP Financial Measure Reconciliation: Financial Institutions often use the "efficiency ratio", a non-GAAP ratio, as a | |||||||||||
4. | For the current quarter, all of the regulatory capital ratios as well as the Total Risk-Weighted Assets are calculated in accordance | |||||||||||
6/30/2026 | 3/31/2026 | 12/31/2025 | 9/30/2025 | 6/30/2025 | ||||||||
Total Risk Weighted Assets | $ 3,253,881 | $ 3,180,782 | $ 3,182,240 | $ 3,095,225 | $ 3,121,451 | |||||||
Common Equity Tier 1 Capital | 429,971 | 423,139 | 414,050 | 404,426 | 397,432 | |||||||
Common Equity Tier 1 Ratio | 13.21 % | 13.30 % | 13.01 % | 13.07 % | 12.73 % | |||||||
5. | Non-GAAP Financial Measure Reconciliation: Net Income and Net Non-Interest Expense adjusted for non-core expenses. Non- | |||||||||||
6/30/2026 | 3/31/2026 | 12/31/2025 | 9/30/2025 | 6/30/2025 | ||||||||
Net Income | $ 10,962 | $ 13,485 | $ 14,013 | $ 12,825 | $ 10,805 | |||||||
Non-Core Expenses: | ||||||||||||
Merger-Related Expenses | 971 | 790 | — | — | — | |||||||
Unification Expenses | — | — | — | 543 | 1,134 | |||||||
Less: Tax Benefit | (214) | (174) | — | (119) | (249) | |||||||
Net Non-Core Expenses (Non-GAAP) | 757 | 616 | — | 424 | 885 | |||||||
Core Net Income (Non-GAAP) | $ 11,719 | $ 14,101 | $ 14,013 | $ 13,249 | $ 11,690 | |||||||
Net Non-Interest Expense | $ 27,393 | $ 26,793 | $ 25,730 | $ 25,357 | $ 25,572 | |||||||
Non-Core Expenses: | ||||||||||||
Merger-Related Expenses | 971 | 790 | — | — | — | |||||||
Unification Expenses | — | — | — | 543 | 1,134 | |||||||
Core Net Non-Interest Expense (Non-GAAP) | $ 26,422 | $ 26,003 | $ 25,730 | $ 24,814 | $ 24,438 | |||||||
Core Earnings Per Share (Non-GAAP) | $ 0.71 | $ 0.85 | $ 0.85 | $ 0.80 | $ 0.70 | |||||||
Core Return on Average Assets (Non-GAAP) | 1.06 % | 1.29 % | 1.24 % | 1.20 % | 1.08 % | |||||||
Core Efficiency Ratio (Non-GAAP) | 59.83 % | 58.13 % | 58.94 % | 58.28 % | 60.60 % | |||||||
* Quarterly ratios have been annualized. | ||||||||||||
Arrow Financial Corporation | |||||||||||
Average Consolidated Balance Sheets and Net Interest Income Analysis | |||||||||||
(Dollars in Thousands - Unaudited) | |||||||||||
Quarter Ended: | June 30, 2026 | June 30, 2025 | |||||||||
Interest | Rate | Interest | Rate | ||||||||
Average | Income/ | Earned/ | Average | Income/ | Earned/ | ||||||
Balance | Expense | Paid | Balance | Expense | Paid | ||||||
Interest-Earning Deposits at Banks | $ 129,628 | $ 1,200 | 3.71 % | $ 145,473 | $ 1,622 | 4.47 % | |||||
Investment Securities: | |||||||||||
Fully Taxable | 548,084 | 4,717 | 3.45 | 496,614 | 3,790 | 3.06 | |||||
Exempt from Federal Taxes | 66,687 | 519 | 3.12 | 85,766 | 561 | 2.62 | |||||
Loans (1) | 3,466,810 | 47,181 | 5.46 | 3,415,140 | 45,600 | 5.36 | |||||
Total Earning Assets (1) | 4,211,209 | 53,617 | 5.11 | 4,142,993 | 51,573 | 4.99 | |||||
Allowance for Credit Losses | (34,305) | (35,238) | |||||||||
Cash and Due From Banks | 29,874 | 29,267 | |||||||||
Other Assets | 219,043 | 195,317 | |||||||||
Total Assets | $ 4,425,821 | $ 4,332,339 | |||||||||
Deposits: | |||||||||||
Interest-Bearing Checking Accounts | $ 827,385 | 2,162 | 1.05 | $ 845,041 | 1,941 | 0.92 | |||||
Savings Deposits | 1,596,055 | 8,933 | 2.24 | 1,494,930 | 9,367 | 2.51 | |||||
Time Deposits over $250,000 | 139,256 | 1,052 | 3.03 | 179,980 | 1,726 | 3.85 | |||||
Other Time Deposits | 510,936 | 4,304 | 3.38 | 638,376 | 5,793 | 3.64 | |||||
Total Interest-Bearing Deposits | 3,073,632 | 16,451 | 2.15 | 3,158,327 | 18,827 | 2.39 | |||||
Borrowings | 124,411 | 1,019 | 3.29 | 8,601 | — | — | |||||
Junior Subordinated Obligations Issued to | 20,000 | 171 | 3.43 | 20,000 | 171 | 3.43 | |||||
Finance Leases | 4,896 | 45 | 3.69 | 4,978 | 42 | 3.38 | |||||
Total Interest-Bearing Liabilities | 3,222,939 | 17,686 | 2.20 | 3,191,906 | 19,040 | 2.39 | |||||
Noninterest-Bearing Deposits | 715,329 | 690,766 | |||||||||
Other Liabilities | 41,666 | 43,138 | |||||||||
Total Liabilities | 3,979,934 | 3,925,810 | |||||||||
Stockholders' Equity | 445,887 | 406,529 | |||||||||
Total Liabilities and Stockholders' Equity | $ 4,425,821 | $ 4,332,339 | |||||||||
Net Interest Income | $ 35,931 | $ 32,533 | |||||||||
Net Interest Spread | 2.91 % | 2.60 % | |||||||||
Net Interest Margin | 3.42 % | 3.15 % | |||||||||
(1) Includes Nonaccrual Loans. |
Arrow Financial Corporation | |||||||||||
Average Consolidated Balance Sheets and Net Interest Income Analysis | |||||||||||
(Dollars in Thousands - Unaudited) | |||||||||||
Quarter Ended: | June 30, 2026 | March 31, 2026 | |||||||||
Interest | Rate | Interest | Rate | ||||||||
Average | Income/ | Earned/ | Average | Income/ | Earned/ | ||||||
Balance | Expense | Paid | Balance | Expense | Paid | ||||||
Interest-Earning Deposits at Banks | $ 129,628 | $ 1,200 | 3.71 % | $ 183,252 | $ 1,675 | 3.71 % | |||||
Investment Securities: | |||||||||||
Fully Taxable | 548,084 | 4,717 | 3.45 | 536,293 | 4,529 | 3.42 | |||||
Exempt from Federal Taxes | 66,687 | 519 | 3.12 | 62,524 | 464 | 3.01 | |||||
Loans (1) | 3,466,810 | 47,181 | 5.46 | 3,440,505 | 47,126 | 5.56 | |||||
Total Earning Assets (1) | 4,211,209 | 53,617 | 5.11 | 4,222,574 | 53,794 | 5.17 | |||||
Allowance for Credit Losses | (34,305) | (34,370) | |||||||||
Cash and Due From Banks | 29,874 | 30,253 | |||||||||
Other Assets | 219,043 | 221,376 | |||||||||
Total Assets | $ 4,425,821 | $ 4,439,833 | |||||||||
Deposits: | |||||||||||
Interest-Bearing Checking Accounts | $ 827,385 | 2,162 | 1.05 | $ 859,054 | 2,100 | 0.99 | |||||
Savings Deposits | 1,596,055 | 8,933 | 2.24 | 1,570,598 | 8,716 | 2.25 | |||||
Time Deposits over $250,000 | 139,256 | 1,052 | 3.03 | 147,425 | 1,196 | 3.29 | |||||
Other Time Deposits | 510,936 | 4,304 | 3.38 | 638,451 | 5,436 | 3.45 | |||||
Total Interest-Bearing Deposits | 3,073,632 | 16,451 | 2.15 | 3,215,528 | 17,448 | 2.20 | |||||
Borrowings | 124,411 | 1,019 | 3.29 | 4,265 | — | — | |||||
Junior Subordinated Obligations Issued to | 20,000 | 171 | 3.43 | 20,000 | 169 | 3.43 | |||||
Finance Leases | 4,896 | 45 | 3.69 | 4,916 | 47 | 3.88 | |||||
Total Interest-Bearing Liabilities | 3,222,939 | 17,686 | 2.20 | 3,244,709 | 17,664 | 2.21 | |||||
Noninterest-Bearing Deposits | 715,329 | 713,233 | |||||||||
Other Liabilities | 41,666 | 43,045 | |||||||||
Total Liabilities | 3,979,934 | 4,000,987 | |||||||||
Stockholders' Equity | 445,887 | 438,846 | |||||||||
Total Liabilities and Stockholders' Equity | $ 4,425,821 | $ 4,439,833 | |||||||||
Net Interest Income | $ 35,931 | $ 36,130 | |||||||||
Net Interest Spread | 2.91 % | 2.96 % | |||||||||
Net Interest Margin | 3.42 % | 3.47 % | |||||||||
(1) Includes Nonaccrual Loans. |
Arrow Financial Corporation | |||||||||||
Average Consolidated Balance Sheets and Net Interest Income Analysis | |||||||||||
(Dollars in Thousands - Unaudited) | |||||||||||
Year to Date Period Ended: | June 30, 2026 | June 30, 2025 | |||||||||
Interest | Rate | Interest | Rate | ||||||||
Average | Income/ | Earned/ | Average | Income/ | Earned/ | ||||||
Balance | Expense | Paid | Balance | Expense | Paid | ||||||
Interest-Earning Deposits at Banks | $ 156,292 | $ 2,875 | 3.71 % | $ 145,746 | $ 3,243 | 4.49 % | |||||
Investment Securities: | |||||||||||
Fully Taxable | 542,221 | 9,246 | 3.44 | 498,250 | 7,398 | 2.99 | |||||
Exempt from Federal Taxes | 64,617 | 983 | 3.07 | 88,835 | 1,148 | 2.61 | |||||
Loans (1) | 3,453,730 | 94,307 | 5.51 | 3,410,632 | 90,150 | 5.33 | |||||
Total Earning Assets (1) | 4,216,860 | 107,411 | 5.14 | 4,143,463 | 101,939 | 4.96 | |||||
Allowance for Credit Losses | (34,338) | (34,469) | |||||||||
Cash and Due From Banks | 30,062 | 30,385 | |||||||||
Other Assets | 220,117 | 189,269 | |||||||||
Total Assets | $ 4,432,701 | $ 4,328,648 | |||||||||
Deposits: | |||||||||||
Interest-Bearing Checking Accounts | $ 843,132 | 4,262 | 1.02 | $ 842,818 | 3,744 | 0.90 | |||||
Savings Deposits | 1,583,396 | 17,649 | 2.25 | 1,505,387 | 18,850 | 2.53 | |||||
Time Deposits over $250,000 | 143,318 | 2,248 | 3.16 | 183,053 | 3,537 | 3.90 | |||||
Other Time Deposits | 574,341 | 9,740 | 3.42 | 615,878 | 11,322 | 3.71 | |||||
Total Interest-Bearing Deposits | 3,144,187 | 33,899 | 2.17 | 3,147,136 | 37,453 | 2.40 | |||||
Borrowings | 64,671 | 1,019 | 3.18 | 15,949 | 167 | 2.11 | |||||
Junior Subordinated Obligations Issued to | 20,000 | 340 | 3.43 | 20,000 | 340 | 3.43 | |||||
Finance Leases | 4,905 | 92 | 3.78 | 4,987 | 89 | 3.60 | |||||
Total Interest-Bearing Liabilities | 3,233,763 | 35,350 | 2.20 | 3,188,072 | 38,049 | 2.41 | |||||
Noninterest-Bearing Deposits | 714,287 | 690,039 | |||||||||
Other Liabilities | 42,264 | 45,069 | |||||||||
Total Liabilities | 3,990,314 | 3,923,180 | |||||||||
Stockholders' Equity | 442,387 | 405,468 | |||||||||
Total Liabilities and Stockholders' Equity | $ 4,432,701 | $ 4,328,648 | |||||||||
Net Interest Income | $ 72,061 | $ 63,890 | |||||||||
Net Interest Spread | 2.94 % | 2.55 % | |||||||||
Net Interest Margin | 3.45 % | 3.11 % | |||||||||
(1) Includes Nonaccrual Loans. | |||||||||||
Arrow Financial Corporation | |||
Consolidated Financial Information | |||
(Dollars in Thousands - Unaudited) | |||
Quarter Ended: | 6/30/2026 | 12/31/2025 | |
Loan Portfolio | |||
Commercial Loans | $ 173,057 | $ 165,729 | |
Commercial Real Estate Loans | 837,461 | 818,259 | |
Subtotal Commercial Loan Portfolio | 1,010,518 | 983,988 | |
Consumer Loans | 1,083,169 | 1,076,007 | |
Residential Real Estate Loans | 1,402,854 | 1,393,098 | |
Total Loans | $ 3,496,541 | $ 3,453,093 | |
Allowance for Credit Losses | |||
Allowance for Credit Losses, Beginning of Quarter | $ 34,055 | $ 34,176 | |
Loans Charged-off | (1,770) | (1,477) | |
Less Recoveries of Loans Previously Charged-off | 1,071 | 777 | |
Net Loans Charged-off | (699) | (700) | |
Provision for Credit Losses | 2,827 | 846 | |
Allowance for Credit Losses, End of Quarter | $ 36,183 | $ 34,322 | |
Nonperforming Assets | |||
Nonaccrual Loans | $ 6,814 | $ 6,415 | |
Loans Past Due 90 or More Days and Accruing | 1,487 | 2,040 | |
Loans Restructured and in Compliance with Modified Terms | — | — | |
Total Nonperforming Loans | 8,301 | 8,455 | |
Repossessed Assets | 363 | 280 | |
Other Real Estate Owned | — | — | |
Total Nonperforming Assets | $ 8,664 | $ 8,735 | |
Key Asset Quality Ratios | |||
Net Loans Charged-off to Average Loans, Quarter-to-date Annualized | 0.08 % | 0.08 % | |
Provision for Credit Losses to Average Loans, Quarter-to-date Annualized | 0.33 % | 0.10 % | |
Allowance for Credit Losses to Period-End Loans | 1.03 % | 0.99 % | |
Allowance for Credit Losses to Period-End Nonperforming Loans | 435.89 % | 405.94 % | |
Nonperforming Loans to Period-End Loans | 0.24 % | 0.24 % | |
Nonperforming Assets to Period-End Assets | 0.19 % | 0.20 % | |
Year-to-Date Period Ended: | 6/30/2026 | 12/31/2025 | |
Allowance for Credit Losses | |||
Allowance for Credit Losses, Beginning of Year | $ 34,322 | $ 33,598 | |
Loans Charged-off | (3,344) | (9,554) | |
Less Recoveries of Loans Previously Charged-off | 1,830 | 3,004 | |
Net Loans Charged-off | (1,514) | (6,550) | |
Provision for Credit Losses | 3,375 | 7,274 | |
Allowance for Credit Losses, End of Period | $ 36,183 | $ 34,322 | |
Key Asset Quality Ratios | |||
Net Loans Charged-off to Average Loans, Annualized | 0.09 % | 0.19 % | |
Provision for Loan Losses to Average Loans, Annualized | 0.20 % | 0.21 % | |
SOURCE Arrow Financial Corporation
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