New York
|
|
22-2448962
|
||
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
||
250 GLEN STREET, GLENS FALLS, NEW YORK 12801
|
||||
(Address of principal executive offices) (Zip Code)
|
||||
Registrant’s telephone number, including area code: (518) 745-1000
|
||||
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: NONE
|
||||
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
|
||||
Common Stock, Par Value $1.00
|
||||
(Title of Class)
|
Large accelerated filer
|
Accelerated filer
x
|
Non-accelerated filer
|
Smaller reporting company
|
Class
|
|
Outstanding as of February 21, 2014
|
Common Stock, par value $1.00 per share
|
|
12,342,000
|
|
Page
|
|
Note on Terminology
|
3
|
|
The Company and Its Subsidiaries
|
3
|
|
Forward-Looking Statements
|
3
|
|
Use of Non-GAAP Financial Measures
|
4
|
|
PART I
|
|
|
|
||
|
||
|
||
|
||
|
||
|
||
PART II
|
|
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
PART III
|
|
|
|
||
|
||
|
||
|
||
|
||
PART IV
|
|
|
|
||
|
||
|
Topic
|
Section
|
Page
|
Location
|
Dividend Capacity
|
Part I, Item 1.C.
|
9
|
1st paragraph under "Dividend Restrictions; Other Regulatory Sanctions"
|
|
Part II, Item 7.E.
|
50
|
1st paragraph under "Dividends"
|
Impact of Legislative Developments
|
Part I, Item 1.D.
|
12
|
Last paragraph in Section D
|
|
Part II, Item 7.A.
|
27
|
Paragraph in "Health Care Reform"
|
VISA Estimation
|
Part II, Item 7.A.
|
27
|
Paragraph under "VISA Transactions - Reversal of the Litigation Reserve"
|
Impact of Changing Interest Rates
on Earnings
|
Part II, Item 7.B.I.
|
32
|
Paragraphs under "Potential Inflation; Effect on Interest Rates and Margin"
|
|
Part II, Item 7.C.II.a.
|
42
|
Last paragraph under “Automobile Loans”
|
|
Part II, Item 7.C.II.a.
|
43
|
3
rd
and 4
th
paragraph under table
|
|
Part II, Item 7.C.IV.
|
47
|
3
rd
paragraph
|
|
Part II, Item 7A.
|
53
|
Last 4 paragraphs
|
Adequacy of the Allowance for Loan
Losses
|
Part II, Item 7.B.II.
|
34
|
1
st
paragraph under
“
II. Provision For Loan Losses and Allowance For Loan Losses
”
|
Noninterest Income
|
Part II, Item 7.C.IV
|
36
|
Last 3 paragraphs under "2013 Compared to 2012"
|
Expected Level of Real Estate Loans
|
Part II, Item 7.C.II.a.
|
42
|
Paragraphs under
“
Residential Real Estate
Loans
”
|
Liquidity
|
Part II, Item 7.D.
|
48
|
Last 2 paragraphs under "Liquidity"
|
Commitments to Extend Credit
|
Part II, Item 8
|
79
|
Last 2 paragraphs in Note 8
|
Pension plan return on assets
|
Part II, Item 8
|
94
|
2
nd
to last paragraph in Note 13
|
Realization of recognized net
deferred tax assets
|
Part II, Item 8
|
95
|
2
nd
to last paragraph in Note 15
|
a.
|
rapid and dramatic changes in economic and market conditions, such as the U.S. economy experienced during the financial crisis of 2008-2010;
|
d.
|
significant new banking or other laws and regulations, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act or Dodd-Frank) and the rules and regulations issued or to be issued thereunder;
|
e.
|
enhanced competition from unforeseen sources; and
|
f.
|
similar uncertainties inherent in banking operations or business generally, including technological developments and changes.
|
Subsidiary Banks
(dollars in thousands)
|
|
|
|
||||
|
Glens Falls National
|
|
Saratoga National
|
||||
Total Assets at Year-End
|
$
|
1,843,285
|
|
|
$
|
319,228
|
|
Trust Assets Under Administration and
Investment Management at Year-End
(Not Included in Total Assets)
|
$
|
1,110,174
|
|
|
$
|
64,717
|
|
Date Organized
|
1851
|
|
|
1988
|
|
||
Employees (full-time equivalent)
|
474
|
|
|
42
|
|
||
Offices
|
30
|
|
|
7
|
|
||
Counties of Operation
|
Warren, Washington,
Saratoga, Essex &
Clinton
|
|
Saratoga
|
||||
Main Office
|
250 Glen Street
Glens Falls, NY
|
|
171 So. Broadway
Saratoga Springs, NY
|
Year, as of January 1
|
2015
|
2016
|
2017
|
2018
|
2019
|
|||||
Minimum CET1 Ratio
|
4.500
|
%
|
4.500
|
%
|
4.500
|
%
|
4.500
|
%
|
4.500
|
%
|
Capital Conservation Buffer
|
N/A
|
|
0.625
|
%
|
1.250
|
%
|
1.875
|
%
|
2.500
|
%
|
CET1 Plus Capital Conservation Buffer
|
4.500
|
%
|
5.125
|
%
|
5.750
|
%
|
6.375
|
%
|
7.000
|
%
|
Phase-in of Deductions from CET1
|
40.000
|
%
|
60.000
|
%
|
80.000
|
%
|
100.000
|
%
|
100.000
|
%
|
Minimum Tier 1 Capital
|
6.000
|
%
|
6.000
|
%
|
6.000
|
%
|
6.000
|
%
|
6.000
|
%
|
Minimum Tier 1 Capital Plus Capital Conservation Buffer
|
N/A
|
|
6.625
|
%
|
7.250
|
%
|
7.875
|
%
|
8.500
|
%
|
Minimum Total Capital
|
8.000
|
%
|
8.000
|
%
|
8.000
|
%
|
8.000
|
%
|
8.000
|
%
|
Minimum Total Capital Plus Capital Conservation Buffer
|
N/A
|
|
8.625
|
%
|
9.250
|
%
|
9.752
|
%
|
10.500
|
%
|
Required Information
|
Location in Report
|
Distribution of Assets, Liabilities and Stockholders' Equity; Interest Rates and Interest Differential
|
Part II, Item 7.B.I.
|
Investment Portfolio
|
Part II, Item 7.C.I.
|
Loan Portfolio
|
Part II, Item 7.C.II.
|
Summary of Loan Loss Experience
|
Part II, Item 7.C.III.
|
Deposits
|
Part II, Item 7.C.IV.
|
Return on Equity and Assets
|
Part II, Item 6.
|
Short-Term Borrowings
|
Part II, Item 7.C.V.
|
Name
|
Age
|
Positions Held and Years from Which Held
|
Thomas J. Murphy, CPA
|
55
|
President and Chief Executive Officer of Arrow since January 1, 2013. He has been a director of Arrow since July 2012. Mr. Murphy served as a Vice President of Arrow from 2009 to 2012, and as Corporate Secretary from 2009 to 2012. Mr. Murphy also has been the President and Chief Executive Officer of GFNB since January 1, 2013. Prior to that date he served as Senior Executive Vice President of Arrow and President of GFNB commencing July 1, 2011. Prior to July 1, 2011, Mr. Murphy served as Senior Trust Officer of GFNB (since 2010) and Cashier of GFNB (since 2009). Murphy previously served as Assistant Corporate Secretary of Arrow (2008-2009), Senior Vice President of GFNB (2008-2011) and Manager of the Personal Trust Department of GFNB (2004-2011). Mr. Murphy started with the Company in 2004.
|
Terry R. Goodemote, CPA
|
50
|
Chief Financial Officer of Arrow since January 1, 2007. He is Executive Vice President of Arrow (since January 1, 2013); prior to that, he was Senior Vice President of Arrow (since 2008). Mr. Goodemote also serves as Chief Financial Officer and Treasurer of GFNB (since January 1, 2007) and as Senior Executive Vice President of GFNB (since July 1, 2011). Before that he was Executive Vice President of GFNB (since 2008). Prior to becoming Chief Financial Officer, Mr. Goodemote served as Senior Vice President and Head of the Accounting Division of GFNB. Mr. Goodemote started with the Company in 1992.
|
David S. DeMarco
|
52
|
Senior Vice President of Arrow since May 1, 2009. Mr. DeMarco has been the President and Chief Executive Officer of SNB since January 1, 2013. Prior to that date, Mr. DeMarco served as Executive Vice President and Head of the Branch, Corporate Development, Financial Services & Marketing Division of GFNB since January 1, 2003. Mr. DeMarco started with the Company in 1987.
|
Item 1B.
|
Unresolved Staff Comments
- None
|
|
2013
|
|
2012
|
||||||||||||||||||||
|
Market Price
|
|
Cash Dividends Declared
|
|
Market Price
|
|
Cash Dividends Declared
|
||||||||||||||||
|
Low
|
|
High
|
|
|
Low
|
|
High
|
|
||||||||||||||
First Quarter
|
$
|
23.14
|
|
|
$
|
25.07
|
|
|
$
|
0.245
|
|
|
$
|
22.36
|
|
|
$
|
26.10
|
|
|
$
|
0.240
|
|
Second Quarter
|
22.95
|
|
|
24.96
|
|
|
0.245
|
|
|
22.15
|
|
|
23.89
|
|
|
0.240
|
|
||||||
Third Quarter
|
24.25
|
|
|
27.21
|
|
|
0.245
|
|
|
22.81
|
|
|
25.18
|
|
|
0.240
|
|
||||||
Fourth Quarter
|
24.91
|
|
|
28.00
|
|
|
0.250
|
|
|
22.41
|
|
|
25.00
|
|
|
0.245
|
|
Plan Category
|
(a)
Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights
|
|
(b)
Weighted-Average
Exercise Price of Outstanding Options, Warrants and Rights
|
|
(c)
Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a))
|
||||
Equity Compensation Plans Approved by Security Holders
(1)(2)
|
389,392
|
|
|
$
|
22.89
|
|
|
668,749
|
|
Equity Compensation Plans Not Approved by Security Holders
|
—
|
|
|
—
|
|
|
—
|
|
|
Total
|
389,392
|
|
|
$
|
22.89
|
|
|
668,749
|
|
(1)
|
All 389,392 shares of common stock listed in column (a) are issuable pursuant to outstanding stock options granted under the LTIP.
|
(2)
|
The total of 668,749 shares listed in column (c) includes 459,000 shares of common stock available for future award grants under the LTIP, 47,548 shares of common stock available for future issuance under the DSP and 162,201 shares of common stock available for future issuance under the ESPP.
|
|
TOTAL RETURN PERFORMANCE
Period Ending
|
|||||||||||||||||||||||||||||||
Index
|
2003
|
|
2004
|
|
2005
|
|
2006
|
|
2007
|
|
2008
|
|
2009
|
|
2010
|
|
2011
|
|
2012
|
|
2013
|
|||||||||||
Arrow Financial
Corporation
|
100.00
|
|
|
114.25
|
|
|
99.98
|
|
|
101.15
|
|
|
94.47
|
|
|
115.34
|
|
|
122.91
|
|
|
144.99
|
|
|
132.63
|
|
|
150.06
|
|
|
169.54
|
|
Russell 2000 Index
|
100.00
|
|
|
118.44
|
|
|
123.91
|
|
|
146.77
|
|
|
144.48
|
|
|
95.67
|
|
|
121.58
|
|
|
154.18
|
|
|
147.75
|
|
|
171.96
|
|
|
238.72
|
|
NASDAQ Banks
Index
|
100.00
|
|
|
114.52
|
|
|
111.86
|
|
|
125.61
|
|
|
99.40
|
|
|
72.47
|
|
|
60.30
|
|
|
71.71
|
|
|
64.14
|
|
|
76.73
|
|
|
109.82
|
|
Zacks $1B - $5B Bank
Assets Index
|
100.00
|
|
|
118.86
|
|
|
116.55
|
|
|
132.87
|
|
|
103.31
|
|
|
94.46
|
|
|
71.14
|
|
|
83.44
|
|
|
78.77
|
|
|
95.23
|
|
|
132.93
|
|
Fourth Quarter 2013
Calendar Month
|
Total Number of
Shares Purchased
1
|
|
Average Price Paid Per Share
1
|
|
Total Number of
Shares Purchased as
Part of Publicly
Announced
Plans or Programs
2
|
|
Maximum
Approximate Dollar
Value of Shares that
May Yet be
Purchased Under the
Plans or Programs
2
|
||||||
October
|
2,691
|
|
|
$
|
25.61
|
|
|
—
|
|
|
$
|
3,761,004
|
|
November
|
8,520
|
|
|
26.81
|
|
|
—
|
|
|
3,761,004
|
|
||
December
|
19,122
|
|
|
26.72
|
|
|
—
|
|
|
3,761,004
|
|
||
Total
|
30,333
|
|
|
26.65
|
|
|
—
|
|
|
|
Consolidated Statements of Income Data
:
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
||||||||||
Interest and Dividend Income
|
$
|
64,138
|
|
|
$
|
69,379
|
|
|
$
|
76,791
|
|
|
$
|
84,972
|
|
|
$
|
86,857
|
|
Interest Expense
|
7,922
|
|
|
11,957
|
|
|
18,679
|
|
|
23,695
|
|
|
26,492
|
|
|||||
Net Interest Income
|
56,216
|
|
|
57,422
|
|
|
58,112
|
|
|
61,277
|
|
|
60,365
|
|
|||||
Provision for Loan Losses
|
200
|
|
|
845
|
|
|
845
|
|
|
1,302
|
|
|
1,783
|
|
|||||
Net Interest Income After Provision
for Loan Losses
|
56,016
|
|
|
56,577
|
|
|
57,267
|
|
|
59,975
|
|
|
58,582
|
|
|||||
Noninterest Income
|
27,521
|
|
|
26,234
|
|
|
23,133
|
|
|
17,582
|
|
|
19,235
|
|
|||||
Net Gains on Securities Transactions
|
540
|
|
|
865
|
|
|
2,795
|
|
|
1,507
|
|
|
357
|
|
|||||
Noninterest Expense
|
(53,203
|
)
|
|
(51,836
|
)
|
|
(51,548
|
)
|
|
(47,418
|
)
|
|
(46,592
|
)
|
|||||
Income Before Provision for Income Taxes
|
30,874
|
|
|
31,840
|
|
|
31,647
|
|
|
31,646
|
|
|
31,582
|
|
|||||
Provision for Income Taxes
|
9,079
|
|
|
9,661
|
|
|
9,714
|
|
|
9,754
|
|
|
9,790
|
|
|||||
Net Income
|
$
|
21,795
|
|
|
$
|
22,179
|
|
|
$
|
21,933
|
|
|
$
|
21,892
|
|
|
$
|
21,792
|
|
Per Common Share:
1
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic Earnings
|
$
|
1.77
|
|
|
$
|
1.81
|
|
|
$
|
1.80
|
|
|
$
|
1.81
|
|
|
$
|
1.81
|
|
Diluted Earnings
|
1.77
|
|
|
1.81
|
|
|
1.79
|
|
|
1.81
|
|
|
1.80
|
|
|||||
Per Common Share:
1
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash Dividends
|
$
|
0.99
|
|
|
$
|
0.97
|
|
|
$
|
0.94
|
|
|
$
|
0.91
|
|
|
$
|
0.89
|
|
Book Value
|
15.55
|
|
|
14.34
|
|
|
13.60
|
|
|
12.63
|
|
|
11.69
|
|
|||||
Tangible Book Value
2
|
13.43
|
|
|
12.18
|
|
|
11.41
|
|
|
11.20
|
|
|
10.30
|
|
|||||
Consolidated Year-End Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total Assets
|
$
|
2,163,698
|
|
|
$
|
2,022,796
|
|
|
$
|
1,962,684
|
|
|
$
|
1,908,336
|
|
|
$
|
1,841,627
|
|
Securities Available-for-Sale
|
457,606
|
|
|
478,698
|
|
|
556,538
|
|
|
517,364
|
|
|
437,706
|
|
|||||
Securities Held-to-Maturity
|
299,261
|
|
|
239,803
|
|
|
150,688
|
|
|
159,938
|
|
|
168,931
|
|
|||||
Loans
|
1,266,472
|
|
|
1,172,341
|
|
|
1,131,457
|
|
|
1,145,508
|
|
|
1,112,150
|
|
|||||
Nonperforming Assets
3
|
7,916
|
|
|
9,070
|
|
|
8,128
|
|
|
4,945
|
|
|
4,772
|
|
|||||
Deposits
|
1,842,330
|
|
|
1,731,155
|
|
|
1,644,046
|
|
|
1,534,004
|
|
|
1,443,566
|
|
|||||
Federal Home Loan Bank Advances
|
73,000
|
|
|
59,000
|
|
|
82,000
|
|
|
130,000
|
|
|
140,000
|
|
|||||
Other Borrowed Funds
|
31,777
|
|
|
32,678
|
|
|
46,293
|
|
|
73,214
|
|
|
93,908
|
|
|||||
Stockholders
’
Equity
|
192,154
|
|
|
175,825
|
|
|
166,385
|
|
|
152,259
|
|
|
140,818
|
|
|||||
Selected Key Ratios:
|
|
|
|
|
|
|
|
|
|
||||||||||
Return on Average Assets
|
1.04
|
%
|
|
1.11
|
%
|
|
1.13
|
%
|
|
1.16
|
%
|
|
1.24
|
%
|
|||||
Return on Average Equity
|
12.11
|
|
|
12.88
|
|
|
13.45
|
|
|
14.56
|
|
|
16.16
|
|
|||||
Dividend Payout
4
|
55.93
|
|
|
53.59
|
|
|
52.51
|
|
|
50.28
|
|
|
49.44
|
|
◦
|
Commercial and Commercial Real Estate Loans:
These loans comprise approximately 32% of our loan portfolio. Current unemployment rates in our region have continued to decline over the past few years. Commercial property values have not shown significant deterioration. We update the appraisals on our nonperforming and watched commercial properties as deemed necessary, usually when the loan is downgraded or when we perceive significant market deterioration since our last appraisal.
|
◦
|
Residential Real Estate Loans:
These loans, including home equity loans, make up approximately 36% of our portfolio. We have not experienced any significant increase in our delinquency and foreclosure rates, primarily due to the fact that we never have originated or participated in underwriting high-risk mortgage loans, such as so called "Alt A", "negative amortization ", "option ARM's" or "negative equity" loans. We originate all of the residential real estate loans held in our portfolio and apply conservative underwriting standards to all of our originations.
|
◦
|
Automobile Loans (Primarily Through Indirect Lending):
These loans comprise approximately 31% of our loan portfolio. Throughout the past three years, we did not experience any significant change in our delinquency rate or level of charge-offs on these loans. We experienced approximately half of the growth in our loan portfolio in this category of loans during 2013.
|
|
Years Ended December 31,
|
|
Change From Prior Year
|
||||||||||||||||||||||
|
|
|
|
|
|
|
2012 to 2013
|
|
2011 to 2012
|
||||||||||||||||
|
2013
|
|
2012
|
|
2011
|
|
Amount
|
|
%
|
|
Amount
|
|
%
|
||||||||||||
Interest and Dividend Income
|
$
|
68,713
|
|
|
$
|
73,273
|
|
|
$
|
80,385
|
|
|
$
|
(4,560
|
)
|
|
(6.2
|
)%
|
|
$
|
(7,112
|
)
|
|
(8.8
|
)%
|
Interest Expense
|
7,922
|
|
|
11,957
|
|
|
18,679
|
|
|
(4,035
|
)
|
|
(33.7
|
)
|
|
(6,722
|
)
|
|
(36.0
|
)
|
|||||
Net Interest Income
|
$
|
60,791
|
|
|
$
|
61,316
|
|
|
$
|
61,706
|
|
|
$
|
(525
|
)
|
|
(0.9
|
)
|
|
$
|
(390
|
)
|
|
(0.6
|
)
|
|
2013 Compared to 2012 Change in Net Interest Income Due to:
|
|
2012 Compared to 2011 Change in Net Interest Income Due to:
|
||||||||||||||||||||
Interest and Dividend Income:
|
Volume
|
|
Rate
|
|
Total
|
|
Volume
|
|
Rate
|
|
Total
|
||||||||||||
Interest-Bearing Bank Balances
|
$
|
(21
|
)
|
|
$
|
2
|
|
|
$
|
(19
|
)
|
|
$
|
6
|
|
|
$
|
4
|
|
|
$
|
10
|
|
Investment Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fully Taxable
|
(610
|
)
|
|
(1,756
|
)
|
|
(2,366
|
)
|
|
344
|
|
|
(3,479
|
)
|
|
(3,135
|
)
|
||||||
Exempt from Federal Taxes
|
2,968
|
|
|
(1,937
|
)
|
|
1,031
|
|
|
233
|
|
|
(141
|
)
|
|
92
|
|
||||||
Loans
|
2,842
|
|
|
(6,048
|
)
|
|
(3,206
|
)
|
|
1,093
|
|
|
(5,172
|
)
|
|
(4,079
|
)
|
||||||
Total Interest and Dividend Income
|
5,179
|
|
|
(9,739
|
)
|
|
(4,560
|
)
|
|
1,676
|
|
|
(8,788
|
)
|
|
(7,112
|
)
|
||||||
Interest Expense:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Deposits:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
NOW Accounts
|
323
|
|
|
(1,426
|
)
|
|
(1,103
|
)
|
|
890
|
|
|
(2,378
|
)
|
|
(1,488
|
)
|
||||||
Savings Deposits
|
142
|
|
|
(405
|
)
|
|
(263
|
)
|
|
120
|
|
|
(731
|
)
|
|
(611
|
)
|
||||||
Time Deposits of $100,000 or More
|
(351
|
)
|
|
(458
|
)
|
|
(809
|
)
|
|
(305
|
)
|
|
(321
|
)
|
|
(626
|
)
|
||||||
Other Time Deposits
|
(513
|
)
|
|
(1,255
|
)
|
|
(1,768
|
)
|
|
(520
|
)
|
|
(893
|
)
|
|
(1,413
|
)
|
||||||
Total Deposits
|
(399
|
)
|
|
(3,544
|
)
|
|
(3,943
|
)
|
|
185
|
|
|
(4,323
|
)
|
|
(4,138
|
)
|
||||||
Short-Term Borrowings
|
20
|
|
|
25
|
|
|
45
|
|
|
(39
|
)
|
|
(31
|
)
|
|
(70
|
)
|
||||||
Long-Term Debt
|
(141
|
)
|
|
4
|
|
|
(137
|
)
|
|
(1,628
|
)
|
|
(886
|
)
|
|
(2,514
|
)
|
||||||
Total Interest Expense
|
(520
|
)
|
|
(3,515
|
)
|
|
(4,035
|
)
|
|
(1,482
|
)
|
|
(5,240
|
)
|
|
(6,722
|
)
|
||||||
Net Interest Income
|
$
|
5,699
|
|
|
$
|
(6,224
|
)
|
|
$
|
(525
|
)
|
|
$
|
3,158
|
|
|
$
|
(3,548
|
)
|
|
$
|
(390
|
)
|
Years Ended:
|
2013
|
|
2012
|
|
2011
|
|||||||||||||||||||||||||||
|
|
|
Interest
|
|
Rate
|
|
|
|
Interest
|
|
Rate
|
|
|
|
Interest
|
|
Rate
|
|||||||||||||||
|
Average
|
|
Income/
|
|
Earned/
|
|
Average
|
|
Income/
|
|
Earned/
|
|
Average
|
|
Income/
|
|
Earned/
|
|||||||||||||||
|
Balance
|
|
Expense
|
|
Paid
|
|
Balance
|
|
Expense
|
|
Paid
|
|
Balance
|
|
Expense
|
|
Paid
|
|||||||||||||||
Interest-Bearing Deposits at
Banks
|
$
|
32,148
|
|
|
$
|
89
|
|
|
0.28
|
%
|
|
$
|
39,783
|
|
|
$
|
108
|
|
|
0.27
|
%
|
|
$
|
37,440
|
|
|
$
|
98
|
|
|
0.26
|
%
|
Investment Securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Fully Taxable
|
432,947
|
|
|
6,920
|
|
|
1.60
|
%
|
|
465,105
|
|
|
9,286
|
|
|
2.00
|
%
|
|
452,264
|
|
|
12,421
|
|
|
2.75
|
%
|
||||||
Exempt from Federal
Taxes
|
314,835
|
|
|
10,105
|
|
|
3.21
|
%
|
|
229,105
|
|
|
9,074
|
|
|
3.96
|
%
|
|
223,259
|
|
|
8,982
|
|
|
4.02
|
%
|
||||||
Loans
|
1,208,954
|
|
|
51,599
|
|
|
4.27
|
%
|
|
1,147,286
|
|
|
54,805
|
|
|
4.78
|
%
|
|
1,126,065
|
|
|
58,884
|
|
|
5.23
|
%
|
||||||
Total Earning Assets
|
1,988,884
|
|
|
68,713
|
|
|
3.45
|
%
|
|
1,881,279
|
|
|
73,273
|
|
|
3.89
|
%
|
|
1,839,028
|
|
|
80,385
|
|
|
4.37
|
%
|
||||||
Allowance for Loan Losses
|
(14,778
|
)
|
|
|
|
|
|
(15,170
|
)
|
|
|
|
|
|
(14,821
|
)
|
|
|
|
|
||||||||||||
Cash and Due From Banks
|
30,985
|
|
|
|
|
|
|
30,936
|
|
|
|
|
|
|
28,844
|
|
|
|
|
|
||||||||||||
Other Assets
|
97,697
|
|
|
|
|
|
|
100,676
|
|
|
|
|
|
|
90,212
|
|
|
|
|
|
||||||||||||
Total Assets
|
$
|
2,102,788
|
|
|
|
|
|
|
$
|
1,997,721
|
|
|
|
|
|
|
$
|
1,943,263
|
|
|
|
|
|
|||||||||
Deposits:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
NOW Accounts
|
$
|
798,230
|
|
|
2,461
|
|
|
0.31
|
%
|
|
$
|
726,660
|
|
|
3,564
|
|
|
0.49
|
%
|
|
$
|
603,965
|
|
|
5,052
|
|
|
0.84
|
%
|
|||
Savings Deposits
|
490,558
|
|
|
1,024
|
|
|
0.21
|
%
|
|
437,095
|
|
|
1,287
|
|
|
0.29
|
%
|
|
409,398
|
|
|
1,898
|
|
|
0.46
|
%
|
||||||
Time Deposits of $100,000
Or More
|
86,457
|
|
|
1,198
|
|
|
1.39
|
%
|
|
107,665
|
|
|
2,007
|
|
|
1.86
|
%
|
|
122,897
|
|
|
2,633
|
|
|
2.14
|
%
|
||||||
Other Time Deposits
|
179,997
|
|
|
1,962
|
|
|
1.09
|
%
|
|
212,918
|
|
|
3,730
|
|
|
1.75
|
%
|
|
238,865
|
|
|
5,143
|
|
|
2.15
|
%
|
||||||
Total Interest-
Bearing Deposits
|
1,555,242
|
|
|
6,645
|
|
|
0.43
|
%
|
|
1,484,338
|
|
|
10,588
|
|
|
0.71
|
%
|
|
1,375,125
|
|
|
14,726
|
|
|
1.07
|
%
|
||||||
Short-Term Borrowings
|
33,404
|
|
|
88
|
|
|
0.26
|
%
|
|
24,225
|
|
|
43
|
|
|
0.18
|
%
|
|
56,206
|
|
|
92
|
|
|
0.16
|
%
|
||||||
FHLBNY Term Advances and
Other Long-Term Debt
|
44,959
|
|
|
1,189
|
|
|
2.64
|
%
|
|
50,301
|
|
|
1,326
|
|
|
2.64
|
%
|
|
103,753
|
|
|
3,861
|
|
|
3.72
|
%
|
||||||
Total Interest-
Bearing Liabilities
|
1,633,605
|
|
|
7,922
|
|
|
0.48
|
%
|
|
1,558,864
|
|
|
11,957
|
|
|
0.77
|
%
|
|
1,535,084
|
|
|
18,679
|
|
|
1.22
|
%
|
||||||
Demand Deposits
|
264,959
|
|
|
|
|
|
|
240,872
|
|
|
|
|
|
|
221,035
|
|
|
|
|
|
||||||||||||
Other Liabilities
|
24,234
|
|
|
|
|
|
|
25,810
|
|
|
|
|
|
|
24,081
|
|
|
|
|
|
||||||||||||
Total Liabilities
|
1,922,798
|
|
|
|
|
|
|
1,825,546
|
|
|
|
|
|
|
1,780,200
|
|
|
|
|
|
||||||||||||
Stockholders
’
Equity
|
179,990
|
|
|
|
|
|
|
172,175
|
|
|
|
|
|
|
163,063
|
|
|
|
|
|
||||||||||||
Total Liabilities and
Stockholders
’
Equity
|
$
|
2,102,788
|
|
|
|
|
|
|
$
|
1,997,721
|
|
|
|
|
|
|
$
|
1,943,263
|
|
|
|
|
|
|||||||||
Net Interest Income
(Tax-equivalent Basis)
|
|
|
60,791
|
|
|
|
|
|
|
61,316
|
|
|
|
|
|
|
61,706
|
|
|
|
||||||||||||
Reversal of Tax
Equivalent Adjustment
|
|
|
(4,575
|
)
|
|
0.23
|
%
|
|
|
|
(3,894
|
)
|
|
0.21
|
%
|
|
|
|
(3,594
|
)
|
|
0.20
|
%
|
|||||||||
Net Interest Income
|
|
|
$
|
56,216
|
|
|
|
|
|
|
$
|
57,422
|
|
|
|
|
|
|
$
|
58,112
|
|
|
|
|||||||||
Net Interest Spread
|
|
|
|
|
2.97
|
%
|
|
|
|
|
|
3.12
|
%
|
|
|
|
|
|
3.15
|
%
|
||||||||||||
Net Interest Margin
|
|
|
|
|
3.06
|
%
|
|
|
|
|
|
3.26
|
%
|
|
|
|
|
|
3.36
|
%
|
YIELD ANALYSIS (Tax-equivalent basis)
|
December 31,
|
|||||||
|
2013
|
|
2012
|
|
2011
|
|||
Yield on Earning Assets
|
3.45
|
%
|
|
3.89
|
%
|
|
4.37
|
%
|
Cost of Interest-Bearing Liabilities
|
0.48
|
|
|
0.77
|
|
|
1.22
|
|
Net Interest Spread
|
2.97
|
%
|
|
3.12
|
%
|
|
3.15
|
%
|
Net Interest Margin
|
3.06
|
%
|
|
3.26
|
%
|
|
3.36
|
%
|
|
Years Ended December 31,
|
|
Change From Prior Year
|
||||||||||||||||||||||
|
|
|
|
|
|
|
2012 to 2013
|
|
2011 to 2012
|
||||||||||||||||
|
2013
|
|
2012
|
|
2011
|
|
Amount
|
|
%
|
|
Amount
|
|
%
|
||||||||||||
Earning Assets
|
$
|
1,988,884
|
|
|
$
|
1,881,279
|
|
|
$
|
1,839,028
|
|
|
$
|
107,605
|
|
|
5.7
|
%
|
|
$
|
42,251
|
|
|
2.3
|
%
|
Interest-Bearing Liabilities
|
1,633,605
|
|
|
1,558,864
|
|
|
1,535,084
|
|
|
74,741
|
|
|
4.8
|
|
|
23,780
|
|
|
1.5
|
|
|||||
Demand Deposits
|
264,959
|
|
|
240,872
|
|
|
221,035
|
|
|
24,087
|
|
|
10.0
|
|
|
19,837
|
|
|
9.0
|
|
|||||
Total Assets
|
2,102,788
|
|
|
1,997,721
|
|
|
1,943,263
|
|
|
105,067
|
|
|
5.3
|
|
|
54,458
|
|
|
2.8
|
|
|||||
Earning Assets to Total Assets
|
94.58
|
%
|
|
94.17
|
%
|
|
94.64
|
%
|
|
|
|
|
|
|
|
|
Years-Ended December 31,
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
||||||||||
Period-End Loans
|
$
|
1,266,472
|
|
|
$
|
1,172,341
|
|
|
$
|
1,131,457
|
|
|
$
|
1,145,508
|
|
|
$
|
1,112,150
|
|
Average Loans
|
1,208,954
|
|
|
1,147,286
|
|
|
1,126,065
|
|
|
1,134,718
|
|
|
1,101,759
|
|
|||||
Period-End Assets
|
2,163,698
|
|
|
2,022,796
|
|
|
1,962,684
|
|
|
1,908,336
|
|
|
1,841,627
|
|
|||||
Nonperforming Assets, at Period-End:
|
|
|
|
|
|
|
|
|
|
||||||||||
Nonaccrual Loans:
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial Real Estate
|
2,048
|
|
|
2,026
|
|
|
1,503
|
|
|
2,237
|
|
|
2,235
|
|
|||||
Commercial Loans
|
352
|
|
|
1,787
|
|
|
6
|
|
|
94
|
|
|
309
|
|
|||||
Residential Real Estate Loans
|
3,860
|
|
|
2,400
|
|
|
2,582
|
|
|
916
|
|
|
901
|
|
|||||
Consumer Loans
|
219
|
|
|
420
|
|
|
437
|
|
|
814
|
|
|
945
|
|
|||||
Total Nonaccrual Loans
|
6,479
|
|
|
6,633
|
|
|
4,528
|
|
|
4,061
|
|
|
4,390
|
|
|||||
Loans Past Due 90 or More Days and
|
|
|
|
|
|
|
|
|
|
||||||||||
Still Accruing Interest
|
652
|
|
|
920
|
|
|
1,662
|
|
|
810
|
|
|
270
|
|
|||||
Restructured
|
641
|
|
|
483
|
|
|
1,422
|
|
|
16
|
|
|
—
|
|
|||||
Total Nonperforming Loans
|
7,772
|
|
|
8,036
|
|
|
7,612
|
|
|
4,887
|
|
|
4,660
|
|
|||||
Repossessed Assets
|
63
|
|
|
64
|
|
|
56
|
|
|
58
|
|
|
59
|
|
|||||
Other Real Estate Owned
|
81
|
|
|
970
|
|
|
460
|
|
|
—
|
|
|
53
|
|
|||||
Nonaccrual Investments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total Nonperforming Assets
|
$
|
7,916
|
|
|
$
|
9,070
|
|
|
$
|
8,128
|
|
|
$
|
4,945
|
|
|
$
|
4,772
|
|
Allowance for Loan Losses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at Beginning of Period
|
$
|
15,298
|
|
|
$
|
15,003
|
|
|
$
|
14,689
|
|
|
$
|
14,014
|
|
|
$
|
13,272
|
|
Loans Charged-off:
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial Loans
|
(926
|
)
|
|
(90
|
)
|
|
(105
|
)
|
|
(30
|
)
|
|
(88
|
)
|
|||||
Real Estate - Commercial
|
(11
|
)
|
|
(206
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Real Estate - Residential
|
(15
|
)
|
|
(33
|
)
|
|
(147
|
)
|
|
—
|
|
|
(25
|
)
|
|||||
Consumer Loans
|
(459
|
)
|
|
(453
|
)
|
|
(522
|
)
|
|
(864
|
)
|
|
(1,317
|
)
|
|||||
Total Loans Charged-off
|
(1,411
|
)
|
|
(782
|
)
|
|
(774
|
)
|
|
(894
|
)
|
|
(1,430
|
)
|
|||||
Recoveries of Loans Previously Charged-off:
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial Loans
|
88
|
|
|
23
|
|
|
17
|
|
|
5
|
|
|
14
|
|
|||||
Real Estate – Commercial
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Real Estate – Residential
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|||||
Consumer Loans
|
259
|
|
|
209
|
|
|
226
|
|
|
262
|
|
|
369
|
|
|||||
Total Recoveries of Loans Previously Charged-off
|
347
|
|
|
232
|
|
|
243
|
|
|
267
|
|
|
389
|
|
|||||
Net Loans Charged-off
|
(1,064
|
)
|
|
(550
|
)
|
|
(531
|
)
|
|
(627
|
)
|
|
(1,041
|
)
|
|||||
Provision for Loan Losses
|
|
|
|
|
|
|
|
|
|
||||||||||
Charged to Expense
|
200
|
|
|
845
|
|
|
845
|
|
|
1,302
|
|
|
1,783
|
|
|||||
Balance at End of Period
|
$
|
14,434
|
|
|
$
|
15,298
|
|
|
$
|
15,003
|
|
|
$
|
14,689
|
|
|
$
|
14,014
|
|
Asset Quality Ratios:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Charged-offs to Average Loans
|
0.09
|
%
|
|
0.05
|
%
|
|
0.05
|
%
|
|
0.06
|
%
|
|
0.09
|
%
|
|||||
Provision for Loan Losses to Average Loans
|
0.02
|
%
|
|
0.07
|
%
|
|
0.08
|
%
|
|
0.11
|
%
|
|
0.16
|
%
|
|||||
Allowance for Loan Losses to Period-end Loans
|
1.14
|
%
|
|
1.30
|
%
|
|
1.33
|
%
|
|
1.28
|
%
|
|
1.26
|
%
|
|||||
Allowance for Loan Losses to Nonperforming Loans
|
185.71
|
%
|
|
190.37
|
%
|
|
197.10
|
%
|
|
300.57
|
%
|
|
300.73
|
%
|
|||||
Nonperforming Loans to Period-end Loans
|
0.61
|
%
|
|
0.69
|
%
|
|
0.67
|
%
|
|
0.43
|
%
|
|
0.42
|
%
|
|||||
Nonperforming Assets to Period-end Assets
|
0.37
|
%
|
|
0.45
|
%
|
|
0.41
|
%
|
|
0.26
|
%
|
|
0.26
|
%
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
||||||||||
Commercial and Commercial Construction
|
$
|
2,303
|
|
|
$
|
2,945
|
|
|
$
|
2,529
|
|
|
$
|
2,037
|
|
|
$
|
1,304
|
|
Real Estate-Commercial
|
3,545
|
|
|
3,050
|
|
|
3,136
|
|
|
3,128
|
|
|
4,000
|
|
|||||
Real Estate-Residential Mortgage
|
3,026
|
|
|
3,405
|
|
|
3,414
|
|
|
3,163
|
|
|
2,954
|
|
|||||
Automobile and Other Consumer
|
4,478
|
|
|
4,840
|
|
|
4,846
|
|
|
5,088
|
|
|
4,901
|
|
|||||
Unallocated
|
1,082
|
|
|
1,058
|
|
|
1,078
|
|
|
1,273
|
|
|
855
|
|
|||||
Total
|
$
|
14,434
|
|
|
$
|
15,298
|
|
|
$
|
15,003
|
|
|
$
|
14,689
|
|
|
$
|
14,014
|
|
|
Years Ended December 31,
|
|
Change From Prior Year
|
||||||||||||||||||||||
|
|
|
|
|
|
|
2012 to 2013
|
|
2011 to 2012
|
||||||||||||||||
|
2013
|
|
2012
|
|
2011
|
|
Amount
|
|
%
|
|
Amount
|
|
%
|
||||||||||||
Income from Fiduciary Activities
|
$
|
6,735
|
|
|
$
|
6,290
|
|
|
$
|
6,113
|
|
|
$
|
445
|
|
|
7.1
|
%
|
|
$
|
177
|
|
|
2.9
|
%
|
Fees for Other Services to Customers
|
9,407
|
|
|
8,245
|
|
|
8,034
|
|
|
1,162
|
|
|
14.1
|
|
|
211
|
|
|
2.6
|
|
|||||
Net Gain on Securities Transactions
|
540
|
|
|
865
|
|
|
2,795
|
|
|
(325
|
)
|
|
(37.6
|
)
|
|
(1,930
|
)
|
|
(69.1
|
)
|
|||||
Insurance Commissions
|
8,895
|
|
|
8,247
|
|
|
7,374
|
|
|
648
|
|
|
7.9
|
|
|
873
|
|
|
11.8
|
|
|||||
Net Gain on Sales of Loans
|
1,460
|
|
|
2,282
|
|
|
866
|
|
|
(822
|
)
|
|
(36.0
|
)
|
|
1,416
|
|
|
163.5
|
|
|||||
Other Operating Income
|
1,024
|
|
|
1,170
|
|
|
746
|
|
|
(146
|
)
|
|
(12.5
|
)
|
|
424
|
|
|
56.8
|
|
|||||
Total Noninterest Income
|
$
|
28,061
|
|
|
$
|
27,099
|
|
|
$
|
25,928
|
|
|
$
|
962
|
|
|
3.5
|
|
|
$
|
1,171
|
|
|
4.5
|
|
|
Years Ended December 31,
|
|
Change From Prior Year
|
||||||||||||||||||||||
|
|
|
|
|
|
|
2012 to 2013
|
|
2011 to 2012
|
||||||||||||||||
|
2013
|
|
2012
|
|
2011
|
|
Amount
|
|
%
|
|
Amount
|
|
%
|
||||||||||||
Salaries and Employee Benefits
|
$
|
31,182
|
|
|
$
|
31,703
|
|
|
$
|
30,205
|
|
|
$
|
(521
|
)
|
|
(1.6
|
)%
|
|
$
|
1,498
|
|
|
5.0
|
%
|
Occupancy Expense of Premises, Net
|
4,582
|
|
|
3,970
|
|
|
3,891
|
|
|
612
|
|
|
15.4
|
|
|
79
|
|
|
2.0
|
|
|||||
Furniture and Equipment Expense
|
3,703
|
|
|
3,497
|
|
|
3,478
|
|
|
206
|
|
|
5.9
|
|
|
19
|
|
|
0.5
|
|
|||||
FDIC Regular Assessment
|
1,080
|
|
|
1,026
|
|
|
1,292
|
|
|
54
|
|
|
5.3
|
|
|
(266
|
)
|
|
(20.6
|
)
|
|||||
Amortization of Intangible Assets
|
452
|
|
|
517
|
|
|
510
|
|
|
(65
|
)
|
|
(12.6
|
)
|
|
7
|
|
|
1.4
|
|
|||||
Prepayment Penalty on FHLB Advances
|
—
|
|
|
—
|
|
|
1,638
|
|
|
—
|
|
|
—
|
|
|
(1,638
|
)
|
|
—
|
|
|||||
Other Operating Expense
|
12,204
|
|
|
11,123
|
|
|
10,534
|
|
|
1,081
|
|
|
9.7
|
|
|
589
|
|
|
5.6
|
|
|||||
Total Noninterest Expense
|
$
|
53,203
|
|
|
$
|
51,836
|
|
|
$
|
51,548
|
|
|
$
|
1,367
|
|
|
2.6
|
|
|
$
|
288
|
|
|
0.6
|
|
Efficiency Ratio
|
59.73
|
%
|
|
58.62
|
%
|
|
58.23
|
%
|
|
1.11
|
%
|
|
1.9
|
|
|
0.39
|
%
|
|
0.7
|
|
|
Years Ended December 31,
|
|
Change From Prior Year
|
||||||||||||||||||||||
|
|
|
|
|
|
|
2012 to 2013
|
|
2011 to 2012
|
||||||||||||||||
|
2013
|
|
2012
|
|
2011
|
|
Amount
|
|
%
|
|
Amount
|
|
%
|
||||||||||||
Provision for Income Taxes
|
$
|
9,079
|
|
|
$
|
9,661
|
|
|
$
|
9,714
|
|
|
$
|
(582
|
)
|
|
(6.0
|
)%
|
|
$
|
(53
|
)
|
|
(0.5
|
)%
|
Effective Tax Rate
|
29.4
|
%
|
|
30.3
|
%
|
|
30.7
|
%
|
|
(0.9
|
)%
|
|
(3.0
|
)
|
|
(0.4
|
)%
|
|
(1.3
|
)
|
|
December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
U.S. Agency Obligations
|
$
|
136,475
|
|
|
$
|
122,457
|
|
|
$
|
116,393
|
|
State and Municipal Obligations
|
127,389
|
|
|
84,838
|
|
|
44,999
|
|
|||
Mortgage-Backed Securities - Residential
|
175,778
|
|
|
261,804
|
|
|
392,712
|
|
|||
Corporate and Other Debt Securities
|
16,798
|
|
|
8,451
|
|
|
1,015
|
|
|||
Mutual Funds and Equity Securities
|
1,166
|
|
|
1,148
|
|
|
1,419
|
|
|||
Total
|
$
|
457,606
|
|
|
$
|
478,698
|
|
|
$
|
556,538
|
|
|
Within
One
Year
|
|
After
1 But
Within
5 Years
|
|
After
5 But
Within
10 Years
|
|
After
10 Years
|
|
Total
|
|||||
U.S. Agency Obligations
|
—
|
|
|
136,475
|
|
|
—
|
|
|
—
|
|
|
136,475
|
|
State and Municipal Obligations
|
48,623
|
|
|
76,405
|
|
|
1,681
|
|
|
680
|
|
|
127,389
|
|
Mortgage-Backed Securities - Residential
|
11,181
|
|
|
150,330
|
|
|
14,146
|
|
|
121
|
|
|
175,778
|
|
Corporate and Other Debt Securities
|
—
|
|
|
15,998
|
|
|
—
|
|
|
800
|
|
|
16,798
|
|
Total
|
59,804
|
|
|
379,208
|
|
|
15,827
|
|
|
1,601
|
|
|
456,440
|
|
|
Within
One
Year
|
|
After
1 But
Within
5 Years
|
|
After
5 But
Within
10 Years
|
|
After
10 Years
|
|
Total
|
|||||
U.S. Agency Obligations
|
—
|
%
|
|
0.51
|
%
|
|
—
|
%
|
|
—
|
%
|
|
0.51
|
%
|
State and Municipal Obligations
|
1.22
|
|
|
1.39
|
|
|
7.10
|
|
|
8.14
|
|
|
1.44
|
|
Mortgage-Backed Securities - Residential
|
4.09
|
|
|
2.53
|
|
|
3.75
|
|
|
4.24
|
|
|
2.73
|
|
Corporate and Other Debt Securities
|
—
|
|
|
0.89
|
|
|
—
|
|
|
3.00
|
|
|
1.01
|
|
Total
|
1.75
|
|
|
1.49
|
|
|
4.12
|
|
|
5.02
|
|
|
1.63
|
|
|
December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
State and Municipal Obligations
|
$
|
198,206
|
|
|
$
|
183,373
|
|
|
$
|
149,688
|
|
Mortgage Backed Securities - Residential
|
100,055
|
|
|
55,430
|
|
|
—
|
|
|||
Corporate and Other Debt Securities
|
1,000
|
|
|
1,000
|
|
|
1,000
|
|
|||
Total
|
$
|
299,261
|
|
|
$
|
239,803
|
|
|
$
|
150,688
|
|
|
Within
One Year
|
|
After 1 But
Within 5 Years
|
|
After 5 But
Within 10 Years
|
|
After
10 Years
|
|
Total
|
||||||||||
State and Municipal Obligations
|
$
|
43,043
|
|
|
$
|
82,001
|
|
|
$
|
69,832
|
|
|
$
|
3,330
|
|
|
$
|
198,206
|
|
Mortgage Backed Securities - Residential
|
—
|
|
|
41,958
|
|
|
58,097
|
|
|
—
|
|
|
100,055
|
|
|||||
Corporate and Other Debt Securities
|
—
|
|
|
—
|
|
|
—
|
|
|
1,000
|
|
|
1,000
|
|
|||||
Total
|
$
|
43,043
|
|
|
$
|
123,959
|
|
|
$
|
127,929
|
|
|
$
|
4,330
|
|
|
$
|
299,261
|
|
|
Within
One Year
|
|
After 1 But
Within 5 Years
|
|
After 5 But
Within 10 Years
|
|
After
10 Years
|
|
Total
|
|||||
State and Municipal Obligations
|
1.90
|
%
|
|
3.22
|
%
|
|
4.77
|
%
|
|
6.19
|
%
|
|
3.53
|
%
|
Mortgage Backed Securities - Residential
|
—
|
|
|
1.55
|
|
|
2.55
|
|
|
—
|
|
|
2.13
|
|
Corporate and Other Debt Securities
|
—
|
|
|
—
|
|
|
—
|
|
|
7.00
|
|
|
7.00
|
|
Total
|
1.90
|
|
|
2.13
|
|
|
2.60
|
|
|
6.38
|
|
|
2.36
|
|
|
December 31,
|
||||||||||||||||||||||||||||
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
||||||||||||||||||||
|
Amount
|
|
%
|
|
Amount
|
|
%
|
|
Amount
|
|
%
|
|
Amount
|
|
%
|
|
Amount
|
|
%
|
||||||||||
Commercial
|
$
|
87,893
|
|
|
7
|
|
$
|
105,536
|
|
|
9
|
|
$
|
99,791
|
|
|
9
|
|
$
|
97,621
|
|
|
8
|
|
$
|
89,222
|
|
|
8
|
Commercial Real Estate
–
Construction
|
27,815
|
|
|
2
|
|
29,149
|
|
|
2
|
|
11,083
|
|
|
1
|
|
7,090
|
|
|
1
|
|
15,336
|
|
|
1
|
|||||
Commercial Real Estate
–
Other
|
288,119
|
|
|
23
|
|
245,177
|
|
|
21
|
|
232,149
|
|
|
21
|
|
214,291
|
|
|
19
|
|
185,582
|
|
|
17
|
|||||
Consumer
–
Other
|
7,649
|
|
|
1
|
|
6,684
|
|
|
1
|
|
6,318
|
|
|
1
|
|
6,482
|
|
|
1
|
|
11,981
|
|
|
1
|
|||||
Consumer
–
Automobile
|
394,204
|
|
|
31
|
|
349,100
|
|
|
30
|
|
322,375
|
|
|
28
|
|
334,656
|
|
|
29
|
|
317,854
|
|
|
29
|
|||||
Residential Real Estate
|
460,792
|
|
|
36
|
|
436,695
|
|
|
37
|
|
459,741
|
|
|
40
|
|
485,368
|
|
|
42
|
|
492,175
|
|
|
44
|
|||||
Total Loans
|
1,266,472
|
|
|
100
|
|
1,172,341
|
|
|
100
|
|
1,131,457
|
|
|
100
|
|
1,145,508
|
|
|
100
|
|
1,112,150
|
|
|
100
|
|||||
Allowance for Loan Losses
|
(14,434
|
)
|
|
|
|
(15,298
|
)
|
|
|
|
(15,003
|
)
|
|
|
|
(14,689
|
)
|
|
|
|
(14,014
|
)
|
|
|
|||||
Total Loans, Net
|
$
|
1,252,038
|
|
|
|
|
$
|
1,157,043
|
|
|
|
|
$
|
1,116,454
|
|
|
|
|
$
|
1,130,819
|
|
|
|
|
$
|
1,098,136
|
|
|
|
|
Quarters Ended
|
||||||||||||||||||
|
Dec 2013
|
|
Sep 2013
|
|
Jun 2013
|
|
Mar 2013
|
|
Dec 2012
|
||||||||||
Commercial and Commercial Real Estate
|
$
|
397,503
|
|
|
$
|
386,973
|
|
|
$
|
379,533
|
|
|
$
|
381,281
|
|
|
$
|
366,761
|
|
Residential Real Estate
|
322,080
|
|
|
316,582
|
|
|
305,222
|
|
|
308,091
|
|
|
314,583
|
|
|||||
Home Equity
|
99,722
|
|
|
94,726
|
|
|
91,339
|
|
|
88,926
|
|
|
87,124
|
|
|||||
Consumer Loans - Automobile
|
408,273
|
|
|
398,329
|
|
|
380,993
|
|
|
363,120
|
|
|
361,723
|
|
|||||
Other Consumer Loans
1
|
27,379
|
|
|
28,230
|
|
|
27,954
|
|
|
28,452
|
|
|
30,035
|
|
|||||
Total Loans
|
$
|
1,254,957
|
|
|
$
|
1,224,840
|
|
|
$
|
1,185,041
|
|
|
$
|
1,169,870
|
|
|
$
|
1,160,226
|
|
|
Quarters Ended
|
|||||||||||||
|
Dec 2013
|
|
Sep 2013
|
|
Jun 2013
|
|
Mar 2013
|
|
Dec 2012
|
|||||
Commercial and Commercial Real Estate
|
31.7
|
%
|
|
31.6
|
%
|
|
32.0
|
%
|
|
32.6
|
%
|
|
31.6
|
%
|
Residential Real Estate
|
25.6
|
|
|
25.9
|
|
|
25.7
|
|
|
26.4
|
|
|
27.1
|
|
Home Equity
|
8.0
|
|
|
7.7
|
|
|
7.7
|
|
|
7.6
|
|
|
7.5
|
|
Consumer Loans - Automobile
|
32.5
|
|
|
32.5
|
|
|
32.2
|
|
|
31.0
|
|
|
31.2
|
|
Other Consumer Loans
1
|
2.2
|
|
|
2.3
|
|
|
2.4
|
|
|
2.4
|
|
|
2.6
|
|
Total Loans
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
Quarters Ended
|
|||||||||||||
|
Dec 2013
|
|
Sep 2013
|
|
Jun 2013
|
|
Mar 2013
|
|
Dec 2012
|
|||||
Commercial and Commercial Real Estate
|
4.65
|
%
|
|
4.52
|
%
|
|
4.61
|
%
|
|
4.74
|
%
|
|
4.91
|
%
|
Residential Real Estate
|
4.53
|
|
|
4.62
|
|
|
4.75
|
|
|
4.93
|
|
|
5.00
|
|
Home Equity
|
2.94
|
|
|
2.98
|
|
|
3.00
|
|
|
3.03
|
|
|
3.03
|
|
Consumer Loans - Automobile
|
3.54
|
|
|
3.68
|
|
|
3.83
|
|
|
3.97
|
|
|
4.18
|
|
Other Consumer Loans
1
|
5.72
|
|
|
5.96
|
|
|
5.97
|
|
|
6.16
|
|
|
6.24
|
|
Total Loans
|
4.15
|
|
|
4.18
|
|
|
4.30
|
|
|
4.46
|
|
|
4.60
|
|
|
Within
1 Year
|
|
After 1
But Within
5 Years
|
|
After
5 Years
|
|
Total
|
||||||||
Commercial
|
$
|
27,121
|
|
|
$
|
51,047
|
|
|
$
|
9,725
|
|
|
$
|
87,893
|
|
Commercial Real Estate - Construction
|
9,166
|
|
|
3,027
|
|
|
15,622
|
|
|
27,815
|
|
||||
Total
|
$
|
36,287
|
|
|
$
|
54,074
|
|
|
$
|
25,347
|
|
|
$
|
115,708
|
|
Fixed Interest Rates
|
$
|
1,726
|
|
|
$
|
31,017
|
|
|
$
|
22,153
|
|
|
$
|
54,896
|
|
Variable Interest Rates
|
34,560
|
|
|
23,057
|
|
|
3,194
|
|
|
60,811
|
|
||||
Total
|
$
|
36,286
|
|
|
$
|
54,074
|
|
|
$
|
25,347
|
|
|
$
|
115,707
|
|
Schedule of Changes in OREO
(In Thousands)
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
||||||||||
Balance at Beginning of Year
|
$
|
970
|
|
|
$
|
460
|
|
|
$
|
—
|
|
|
$
|
53
|
|
|
$
|
581
|
|
Properties Acquired Through Foreclosure
|
392
|
|
|
950
|
|
|
409
|
|
|
—
|
|
|
54
|
|
|||||
Transfer of Bank Property
|
—
|
|
|
—
|
|
|
150
|
|
|
—
|
|
|
—
|
|
|||||
Sales
|
(1,281
|
)
|
|
(440
|
)
|
|
(99
|
)
|
|
(53
|
)
|
|
(582
|
)
|
|||||
Balance at End of Year
|
$
|
81
|
|
|
$
|
970
|
|
|
$
|
460
|
|
|
$
|
—
|
|
|
$
|
53
|
|
Number of Properties, Beginning of Year
|
7
|
|
|
5
|
|
|
—
|
|
|
1
|
|
|
4
|
|
|||||
Properties Acquired During the Year
|
1
|
|
|
7
|
|
|
6
|
|
|
—
|
|
|
1
|
|
|||||
Properties Sold During the Year
|
(6
|
)
|
|
(5
|
)
|
|
(1
|
)
|
|
(1
|
)
|
|
(4
|
)
|
|||||
Number of Properties, End of Year
|
2
|
|
|
7
|
|
|
5
|
|
|
—
|
|
|
1
|
|
•
|
Charge-offs and Recoveries by loan type
|
•
|
Factors that led to the amount of the Provision for Loan Losses
|
•
|
Allocation of the Allowance for Loan Losses by loan type
|
|
Years Ended December 31,
|
|||||||||||||||||||
|
2013
|
|
2012
|
|
2011
|
|||||||||||||||
|
Average
Balance
|
|
Rate
|
|
Average
Balance
|
|
Rate
|
|
Average
Balance
|
|
Rate
|
|||||||||
Demand Deposits
|
$
|
264,959
|
|
|
—
|
%
|
|
$
|
240,872
|
|
|
—
|
%
|
|
$
|
221,035
|
|
|
—
|
%
|
NOW Accounts
|
798,230
|
|
|
0.31
|
|
|
726,660
|
|
|
0.49
|
|
|
603,965
|
|
|
0.84
|
|
|||
Savings Deposits
|
490,558
|
|
|
0.21
|
|
|
437,095
|
|
|
0.29
|
|
|
409,398
|
|
|
0.46
|
|
|||
Time Deposits of $100,000 or More
|
86,457
|
|
|
1.39
|
|
|
107,665
|
|
|
1.86
|
|
|
122,897
|
|
|
2.14
|
|
|||
Other Time Deposits
|
179,997
|
|
|
1.09
|
|
|
212,918
|
|
|
1.75
|
|
|
238,865
|
|
|
2.15
|
|
|||
Total Deposits
|
$
|
1,820,201
|
|
|
0.37
|
|
|
$
|
1,725,210
|
|
|
0.61
|
|
|
$
|
1,596,160
|
|
|
1.07
|
|
|
Quarters Ended
|
||||||||||||||||||
|
Dec 2013
|
|
Sep 2013
|
|
Jun 2013
|
|
Mar 2013
|
|
Dec 2012
|
||||||||||
Demand Deposits
|
$
|
279,967
|
|
|
$
|
277,381
|
|
|
$
|
254,642
|
|
|
$
|
247,347
|
|
|
$
|
249,176
|
|
NOW Accounts
|
855,106
|
|
|
749,654
|
|
|
796,330
|
|
|
791,669
|
|
|
798,513
|
|
|||||
Savings Deposits
|
517,542
|
|
|
509,014
|
|
|
479,480
|
|
|
455,311
|
|
|
444,603
|
|
|||||
Time Deposits of $100,000 or More
|
81,804
|
|
|
85,757
|
|
|
87,059
|
|
|
91,322
|
|
|
95,742
|
|
|||||
Other Time Deposits
|
170,503
|
|
|
178,375
|
|
|
183,835
|
|
|
187,477
|
|
|
193,744
|
|
|||||
Total Deposits
|
$
|
1,904,922
|
|
|
$
|
1,800,181
|
|
|
$
|
1,801,346
|
|
|
$
|
1,773,126
|
|
|
$
|
1,781,778
|
|
Percentage of Total Quarterly Average Deposits
|
Quarters Ended
|
|||||||||||||
|
Dec 2013
|
|
|
Sep 2013
|
|
|
Jun 2013
|
|
|
Mar 2013
|
|
|
Dec 2012
|
|
Demand Deposits
|
14.7
|
%
|
|
15.4
|
%
|
|
14.2
|
%
|
|
13.9
|
%
|
|
14.0
|
%
|
NOW Accounts
|
44.8
|
|
|
41.6
|
|
|
44.2
|
|
|
44.6
|
|
|
44.8
|
|
Savings Deposits
|
27.2
|
|
|
28.3
|
|
|
26.6
|
|
|
25.7
|
|
|
24.9
|
|
Time Deposits of $100,000 or More
|
4.3
|
|
|
4.8
|
|
|
4.8
|
|
|
5.2
|
|
|
5.4
|
|
Other Time Deposits
|
9.0
|
|
|
9.9
|
|
|
10.2
|
|
|
10.6
|
|
|
10.9
|
|
Total Deposits
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Quarterly Cost of Deposits
|
Quarters Ended
|
|||||||||||||
|
Dec 2013
|
|
|
Sep 2013
|
|
|
Jun 2013
|
|
|
Mar 2013
|
|
|
Dec 2012
|
|
Demand Deposits
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
NOW Accounts
|
0.22
|
|
|
0.22
|
|
|
0.40
|
|
|
0.40
|
|
|
0.43
|
|
Savings Deposits
|
0.18
|
|
|
0.19
|
|
|
0.23
|
|
|
0.24
|
|
|
0.25
|
|
Time Deposits of $100,000 or More
|
1.34
|
|
|
1.37
|
|
|
1.41
|
|
|
1.42
|
|
|
1.54
|
|
Other Time Deposits
|
1.01
|
|
|
1.05
|
|
|
1.10
|
|
|
1.20
|
|
|
1.34
|
|
Total Deposits
|
0.30
|
|
|
0.32
|
|
|
0.42
|
|
|
0.44
|
|
|
0.48
|
|
Maturing in:
|
|
||
Under Three Months
|
$
|
19,896
|
|
Three to Six Months
|
13,181
|
|
|
Six to Twelve Months
|
20,923
|
|
|
2015
|
8,192
|
|
|
2016
|
4,474
|
|
|
2017
|
5,994
|
|
|
2018
|
4,761
|
|
|
2019
|
1,507
|
|
|
Total
|
$
|
78,928
|
|
|
2013
|
|
2012
|
|
2011
|
||||||
Overnight Advances from the Federal Home Loan Bank of New York,
Federal Funds Purchased and Securities Sold Under Agreements to Repurchase:
|
|
|
|
|
|
||||||
Balance at December 31
|
$
|
64,777
|
|
|
$
|
41,678
|
|
|
$
|
68,293
|
|
Maximum Month-End Balance
|
64,777
|
|
|
41,678
|
|
|
93,988
|
|
|||
Average Balance During the Year
|
33,322
|
|
|
24,225
|
|
|
54,750
|
|
|||
Average Rate During the Year
|
0.27
|
%
|
|
0.18
|
%
|
|
0.17
|
%
|
|||
Rate at December 31
|
0.28
|
%
|
|
0.25
|
%
|
|
0.23
|
%
|
|||
Other Short-Term Borrowings:
|
|
|
|
|
|
||||||
Balance at December 31
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Maximum Month-End Balance
|
—
|
|
|
—
|
|
|
2,211
|
|
|||
Average Balance During the Year
|
—
|
|
|
—
|
|
|
1,456
|
|
|||
Average Rate During the Year
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|||
Rate at December 31
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|||
Average Aggregate Short-Term Borrowing Rate During the Year
|
0.27
|
%
|
|
0.18
|
%
|
|
0.16
|
%
|
Capital Ratios
:
|
Arrow
|
|
GFNB
|
|
SNB
|
|||
Tier 1 Leverage Ratio
|
9.2
|
%
|
|
8.8
|
%
|
|
9.7
|
%
|
Tier 1 Risk-Based Capital Ratio
|
14.7
|
%
|
|
14.4
|
%
|
|
13.7
|
%
|
Total Risk-Based Capital Ratio
|
15.8
|
%
|
|
15.4
|
%
|
|
14.8
|
%
|
|
Payments Due by Period
|
||||||||||||||||||
Contractual Obligation
|
Total
|
|
Less Than
1 Year
|
|
1-3 Years
|
|
3-5 Years
|
|
More Than
5 Years
|
||||||||||
Long-Term Debt Obligations:
|
|
|
|
|
|
|
|
|
|
||||||||||
Federal Home Loan Bank Advances
1
|
$
|
20,000
|
|
|
$
|
10,000
|
|
|
$
|
10,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Junior Subordinated Obligations
Issued to Unconsolidated
Subsidiary Trusts
2
|
20,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20,000
|
|
|||||
Operating Lease Obligations
3
|
2,733
|
|
|
638
|
|
|
1,023
|
|
|
624
|
|
|
448
|
|
|||||
Obligations under Retirement Plans
4
|
45,337
|
|
|
4,030
|
|
|
6,317
|
|
|
6,318
|
|
|
28,672
|
|
|||||
Total
|
$
|
88,070
|
|
|
$
|
14,668
|
|
|
$
|
17,340
|
|
|
$
|
6,942
|
|
|
$
|
49,120
|
|
|
For the Quarters Ended
December 31,
|
||||||
|
2013
|
|
2012
|
||||
Interest and Dividend Income
|
$
|
16,459
|
|
|
$
|
16,740
|
|
Interest Expense
|
1,713
|
|
|
2,503
|
|
||
Net Interest Income
|
14,746
|
|
|
14,237
|
|
||
Provision for Loan Losses
|
—
|
|
|
175
|
|
||
Net Interest Income after Provision for Loan Losses
|
14,746
|
|
|
14,062
|
|
||
Noninterest Income
|
6,877
|
|
|
6,897
|
|
||
Noninterest Expense
|
13,385
|
|
|
13,117
|
|
||
Income Before Provision for Income Taxes
|
8,238
|
|
|
7,842
|
|
||
Provision for Income Taxes
|
2,454
|
|
|
2,293
|
|
||
Net Income
|
$
|
5,784
|
|
|
$
|
5,549
|
|
SHARE AND PER SHARE DATA:
|
|
|
|
||||
Weighted Average Number of Shares Outstanding:
|
|
|
|
||||
Basic
|
12,339
|
|
|
12,254
|
|
||
Diluted
|
12,387
|
|
|
12,273
|
|
||
Basic Earnings Per Common Share
|
$
|
0.47
|
|
|
0.45
|
|
|
Diluted Earnings Per Common Share
|
0.47
|
|
|
0.45
|
|
||
Cash Dividends Per Common Share
|
0.25
|
|
|
0.25
|
|
||
AVERAGE BALANCES:
|
|
|
|
||||
Assets
|
$
|
2,176,264
|
|
|
$
|
2,064,602
|
|
Earning Assets
|
2,064,578
|
|
|
1,945,441
|
|
||
Loans
|
1,254,957
|
|
|
1,160,226
|
|
||
Deposits
|
1,904,922
|
|
|
1,781,778
|
|
||
Stockholders
’
Equity
|
184,506
|
|
|
176,514
|
|
||
SELECTED RATIOS (Annualized):
|
|
|
|
||||
Return on Average Assets
|
1.05
|
%
|
|
1.07
|
%
|
||
Return on Average Equity
|
12.44
|
%
|
|
12.51
|
%
|
||
Net Interest Margin
1
|
3.06
|
%
|
|
3.13
|
%
|
||
Net Charge-offs to Average Loans
|
0.05
|
%
|
|
0.04
|
%
|
||
Provision for Loan Losses to Average Loans
|
—
|
%
|
|
0.06
|
%
|
|
2013
|
||||||||||||||
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
||||||||
Total Interest and Dividend Income
|
$
|
15,996
|
|
|
$
|
15,809
|
|
|
$
|
15,874
|
|
|
$
|
16,459
|
|
Net Interest Income
|
13,757
|
|
|
13,586
|
|
|
14,127
|
|
|
14,746
|
|
||||
Provision for Loan Losses
|
100
|
|
|
100
|
|
|
—
|
|
|
—
|
|
||||
Net Securities Gains
|
527
|
|
|
13
|
|
|
—
|
|
|
—
|
|
||||
Income Before Provision for Income Taxes
|
7,420
|
|
|
7,283
|
|
|
7,933
|
|
|
8,238
|
|
||||
Net Income
|
5,181
|
|
|
5,207
|
|
|
5,623
|
|
|
5,784
|
|
||||
Basic Earnings Per Common Share
|
0.42
|
|
|
0.42
|
|
|
0.46
|
|
|
0.47
|
|
||||
Diluted Earnings Per Common Share
|
0.42
|
|
|
0.42
|
|
|
0.46
|
|
|
0.47
|
|
|
2012
|
||||||||||||||
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
||||||||
Total Interest and Dividend Income
|
$
|
17,938
|
|
|
$
|
17,533
|
|
|
$
|
17,168
|
|
|
$
|
16,740
|
|
Net Interest Income
|
14,406
|
|
|
14,254
|
|
|
14,525
|
|
|
14,237
|
|
||||
Provision for Loan Losses
|
280
|
|
|
240
|
|
|
150
|
|
|
175
|
|
||||
Net Securities Gains
|
502
|
|
|
143
|
|
|
64
|
|
|
156
|
|
||||
Income Before Provision for Income Taxes
|
7,539
|
|
|
8,171
|
|
|
8,288
|
|
|
7,842
|
|
||||
Net Income
|
5,288
|
|
|
5,594
|
|
|
5,748
|
|
|
5,549
|
|
||||
Basic Earnings Per Common Share
|
0.43
|
|
|
0.46
|
|
|
0.47
|
|
|
0.45
|
|
||||
Diluted Earnings Per Common Share
|
0.43
|
|
|
0.46
|
|
|
0.47
|
|
|
0.45
|
|
ARROW FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Share and Per Share Amounts)
|
|||||||
|
December 31, 2013
|
|
December 31, 2012
|
||||
ASSETS
|
|
|
|
||||
Cash and Due From Banks
|
$
|
37,275
|
|
|
$
|
37,076
|
|
Interest-Bearing Deposits at Banks
|
12,705
|
|
|
11,756
|
|
||
Investment Securities:
|
|
|
|
||||
Available-for-Sale
|
457,606
|
|
|
478,698
|
|
||
Held-to-Maturity (Approximate Fair Value of $302,305 at
December 31, 2013 and $248,252 at December 31, 2012)
|
299,261
|
|
|
239,803
|
|
||
Federal Home Loan Bank and Federal Reserve Bank Stock
|
6,281
|
|
|
5,792
|
|
||
Loans
|
1,266,472
|
|
|
1,172,341
|
|
||
Allowance for Loan Losses
|
(14,434
|
)
|
|
(15,298
|
)
|
||
Net Loans
|
1,252,038
|
|
|
1,157,043
|
|
||
Premises and Equipment, Net
|
29,154
|
|
|
28,897
|
|
||
Goodwill
|
22,003
|
|
|
22,003
|
|
||
Other Intangible Assets, Net
|
4,140
|
|
|
4,492
|
|
||
Other Assets
|
43,235
|
|
|
37,236
|
|
||
Total Assets
|
$
|
2,163,698
|
|
|
$
|
2,022,796
|
|
LIABILITIES
|
|
|
|
||||
Noninterest-Bearing Deposits
|
$
|
278,958
|
|
|
$
|
247,232
|
|
NOW Accounts
|
817,366
|
|
|
758,287
|
|
||
Savings Deposits
|
498,779
|
|
|
442,363
|
|
||
Time Deposits of $100,000 or More
|
78,928
|
|
|
93,375
|
|
||
Other Time Deposits
|
168,299
|
|
|
189,898
|
|
||
Total Deposits
|
1,842,330
|
|
|
1,731,155
|
|
||
Short-Term Borrowings
|
64,777
|
|
|
41,678
|
|
||
Federal Home Loan Bank Term Advances
|
20,000
|
|
|
30,000
|
|
||
Junior Subordinated Obligations Issued to Unconsolidated Subsidiary Trusts
|
20,000
|
|
|
20,000
|
|
||
Other Liabilities
|
24,437
|
|
|
24,138
|
|
||
Total Liabilities
|
1,971,544
|
|
|
1,846,971
|
|
||
STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Preferred Stock, $5 Par Value; 1,000,000 Shares Authorized
|
—
|
|
|
—
|
|
||
Common Stock, $1 Par Value; 20,000,000 Shares Authorized
(16,744,486 Shares Issued at December 31, 2013 and
16,416,163 Shares Issued at December 31, 2012)
|
16,744
|
|
|
16,416
|
|
||
Additional Paid-in Capital
|
229,290
|
|
|
218,650
|
|
||
Retained Earnings
|
27,457
|
|
|
26,251
|
|
||
Unallocated ESOP Shares (87,641 Shares at December 31, 2013 and
102,890 Shares at December 31, 2012)
|
(1,800
|
)
|
|
(2,150
|
)
|
||
Accumulated Other Comprehensive Loss
|
(4,373
|
)
|
|
(8,462
|
)
|
||
Treasury Stock, at Cost (4,296,723 Shares at December 31, 2013 and
4,288,617 Shares at December 31, 2012)
|
(75,164
|
)
|
|
(74,880
|
)
|
||
Total Stockholders’ Equity
|
192,154
|
|
|
175,825
|
|
||
Total Liabilities and Stockholders’ Equity
|
$
|
2,163,698
|
|
|
$
|
2,022,796
|
|
ARROW FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In Thousands, Except Per Share Amounts)
|
||||||||||||
|
|
Years Ended December 31,
|
||||||||||
|
|
2013
|
|
2012
|
|
2011
|
||||||
INTEREST AND DIVIDEND INCOME
|
|
|
|
|
|
|
||||||
Interest and Fees on Loans
|
|
$
|
51,319
|
|
|
$
|
54,511
|
|
|
$
|
58,599
|
|
Interest on Deposits at Banks
|
|
89
|
|
|
108
|
|
|
99
|
|
|||
Interest and Dividends on Investment Securities:
|
|
|
|
|
|
|
||||||
Fully Taxable
|
|
6,903
|
|
|
9,269
|
|
|
12,402
|
|
|||
Exempt from Federal Taxes
|
|
5,827
|
|
|
5,491
|
|
|
5,691
|
|
|||
Total Interest and Dividend Income
|
|
64,138
|
|
|
69,379
|
|
|
76,791
|
|
|||
INTEREST EXPENSE
|
|
|
|
|
|
|
||||||
NOW Accounts
|
|
2,461
|
|
|
3,564
|
|
|
5,052
|
|
|||
Savings Deposits
|
|
1,024
|
|
|
1,287
|
|
|
1,898
|
|
|||
Time Deposits of $100,000 or More
|
|
1,198
|
|
|
2,007
|
|
|
2,633
|
|
|||
Other Time Deposits
|
|
1,962
|
|
|
3,730
|
|
|
5,143
|
|
|||
Federal Funds Purchased and
Securities Sold Under Agreements to Repurchase
|
|
18
|
|
|
22
|
|
|
74
|
|
|||
Federal Home Loan Bank Advances
|
|
680
|
|
|
729
|
|
|
3,295
|
|
|||
Junior Subordinated Obligations Issued to
Unconsolidated Subsidiary Trusts
|
|
579
|
|
|
618
|
|
|
584
|
|
|||
Total Interest Expense
|
|
7,922
|
|
|
11,957
|
|
|
18,679
|
|
|||
NET INTEREST INCOME
|
|
56,216
|
|
|
57,422
|
|
|
58,112
|
|
|||
Provision for Loan Losses
|
|
200
|
|
|
845
|
|
|
845
|
|
|||
NET INTEREST INCOME AFTER PROVISION FOR
LOAN LOSSES
|
|
56,016
|
|
|
56,577
|
|
|
57,267
|
|
|||
NONINTEREST INCOME
|
|
|
|
|
|
|
||||||
Income From Fiduciary Activities
|
|
6,735
|
|
|
6,290
|
|
|
6,113
|
|
|||
Fees for Other Services to Customers
|
|
9,407
|
|
|
8,245
|
|
|
8,034
|
|
|||
Insurance Commissions
|
|
8,895
|
|
|
8,247
|
|
|
7,374
|
|
|||
Net Gain on Securities Transactions
|
|
540
|
|
|
865
|
|
|
2,795
|
|
|||
Net Gain on Sales of Loans
|
|
1,460
|
|
|
2,282
|
|
|
866
|
|
|||
Other Operating Income
|
|
1,024
|
|
|
1,170
|
|
|
746
|
|
|||
Total Noninterest Income
|
|
28,061
|
|
|
27,099
|
|
|
25,928
|
|
|||
NONINTEREST EXPENSE
|
|
|
|
|
|
|
||||||
Salaries and Employee Benefits
|
|
31,182
|
|
|
31,703
|
|
|
30,205
|
|
|||
Occupancy Expenses, Net
|
|
8,285
|
|
|
7,467
|
|
|
7,369
|
|
|||
FDIC Assessments
|
|
1,080
|
|
|
1,026
|
|
|
1,292
|
|
|||
Prepayment Penalty on FHLB Advances
|
|
—
|
|
|
—
|
|
|
1,638
|
|
|||
Other Operating Expense
|
|
12,656
|
|
|
11,640
|
|
|
11,044
|
|
|||
Total Noninterest Expense
|
|
53,203
|
|
|
51,836
|
|
|
51,548
|
|
|||
INCOME BEFORE PROVISION FOR INCOME TAXES
|
|
30,874
|
|
|
31,840
|
|
|
31,647
|
|
|||
Provision for Income Taxes
|
|
9,079
|
|
|
9,661
|
|
|
9,714
|
|
|||
NET INCOME
|
|
$
|
21,795
|
|
|
$
|
22,179
|
|
|
$
|
21,933
|
|
Average Shares Outstanding:
|
|
|
|
|
|
|
||||||
Basic
|
|
12,296
|
|
|
12,247
|
|
|
12,209
|
|
|||
Diluted
|
|
12,327
|
|
|
12,257
|
|
|
12,221
|
|
|||
Per Common Share:
|
|
|
|
|
|
|
||||||
Basic Earnings
|
|
$
|
1.77
|
|
|
$
|
1.81
|
|
|
$
|
1.80
|
|
Diluted Earnings
|
|
1.77
|
|
|
1.81
|
|
|
1.79
|
|
ARROW FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In Thousands)
|
|||||||||||
|
Years Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Net Income
|
$
|
21,795
|
|
|
$
|
22,179
|
|
|
$
|
21,933
|
|
Other Comprehensive Income (Loss), Net of Tax:
|
|
|
|
|
|
||||||
Unrealized Net Securities Holding (Losses) Gains Arising During the Year
|
(2,925
|
)
|
|
(661
|
)
|
|
4,741
|
|
|||
Reclassification Adjustment for Net Securities Gains Included in Net Income
|
(326
|
)
|
|
(522
|
)
|
|
(1,688
|
)
|
|||
Net Retirement Plan Gain (Loss)
|
6,425
|
|
|
(1,340
|
)
|
|
(3,701
|
)
|
|||
Net Retirement Plan Prior Service (Cost) Credit
|
—
|
|
|
(245
|
)
|
|
(161
|
)
|
|||
Amortization of Net Retirement Plan Actuarial Loss
|
914
|
|
|
1,013
|
|
|
602
|
|
|||
Accretion of Net Retirement Plan Prior Service Credit
|
1
|
|
|
(12
|
)
|
|
(65
|
)
|
|||
Other Comprehensive (Loss) Income
|
4,089
|
|
|
(1,767
|
)
|
|
(272
|
)
|
|||
Comprehensive Income
|
$
|
25,884
|
|
|
$
|
20,412
|
|
|
$
|
21,661
|
|
|
|||||||||||||||||||||||||||
|
Common
Stock
|
|
Additional
Paid-In
Capital
|
|
Retained
Earnings
|
|
Unallo-cated ESOP
Shares
|
|
Accumu-lated
Other Com-
prehensive
Income
(Loss)
|
|
Treasury
Stock
|
|
Total
|
||||||||||||||
Balance at December 31, 2010
|
$
|
15,626
|
|
|
$
|
191,068
|
|
|
$
|
24,577
|
|
|
$
|
(2,876
|
)
|
|
$
|
(6,423
|
)
|
|
$
|
(69,713
|
)
|
|
$
|
152,259
|
|
Net Income
|
—
|
|
|
—
|
|
|
21,933
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21,933
|
|
|||||||
Other Comprehensive (Loss) Income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(272
|
)
|
|
—
|
|
|
(272
|
)
|
|||||||
3% Stock Dividend (468,765 Shares)
|
468
|
|
|
10,647
|
|
|
(11,115
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Cash Dividends Paid, $.94 per Share
1
|
—
|
|
|
—
|
|
|
(11,448
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11,448
|
)
|
|||||||
Shares Issued for Stock Option Exercises, net
(72,802 Shares) |
—
|
|
|
705
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
708
|
|
|
1,413
|
|
|||||||
Shares Issued Under the Directors’ Stock
Plan (7,456 Shares) |
—
|
|
|
104
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
71
|
|
|
175
|
|
|||||||
Shares Issued Under the Employee Stock
Purchase Plan (20,484 Shares) |
—
|
|
|
282
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
192
|
|
|
474
|
|
|||||||
Shares Issued for Dividend Reinvestment
Plans (76,447 Shares) |
—
|
|
|
1,062
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
734
|
|
|
1,796
|
|
|||||||
Stock-Based Compensation Expense
|
—
|
|
|
354
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
354
|
|
|||||||
Tax Benefit for Exercises of
Stock Options |
—
|
|
|
51
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
51
|
|
|||||||
Purchase of Treasury Stock
(251,962 Shares) |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,039
|
)
|
|
(6,039
|
)
|
|||||||
Acquisition of Subsidiary (221,517 Shares)
|
—
|
|
|
3,275
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,986
|
|
|
5,261
|
|
|||||||
Allocation of ESOP Stock (18,216 Shares)
|
—
|
|
|
52
|
|
|
—
|
|
|
376
|
|
|
—
|
|
|
—
|
|
|
428
|
|
|||||||
Balance at December 31, 2011
|
$
|
16,094
|
|
|
$
|
207,600
|
|
|
$
|
23,947
|
|
|
$
|
(2,500
|
)
|
|
$
|
(6,695
|
)
|
|
$
|
(72,061
|
)
|
|
$
|
166,385
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance at December 31, 2011
|
$
|
16,094
|
|
|
$
|
207,600
|
|
|
$
|
23,947
|
|
|
$
|
(2,500
|
)
|
|
$
|
(6,695
|
)
|
|
$
|
(72,061
|
)
|
|
$
|
166,385
|
|
Net Income
|
—
|
|
|
—
|
|
|
22,179
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22,179
|
|
|||||||
Other Comprehensive (Loss) Income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,767
|
)
|
|
—
|
|
|
(1,767
|
)
|
|||||||
2% Stock Dividend (321,886 Shares)
|
322
|
|
|
7,738
|
|
|
(8,060
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Cash Dividends Paid, $.97 per Share
1
|
—
|
|
|
—
|
|
|
(11,815
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11,815
|
)
|
|||||||
Shares Issued for Stock Option Exercises, net
(96,471 Shares) |
—
|
|
|
1,152
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
953
|
|
|
2,105
|
|
|||||||
Shares Issued Under the Directors’ Stock
Plan (7,226 Shares) |
—
|
|
|
104
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
71
|
|
|
175
|
|
|||||||
Shares Issued Under the Employee Stock
Purchase Plan (20,687 Shares) |
—
|
|
|
279
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
205
|
|
|
484
|
|
|||||||
Shares Issued for Dividend Reinvestment
Plans (74,260 Shares) |
—
|
|
|
1,086
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
736
|
|
|
1,822
|
|
|||||||
Stock-Based Compensation Expense
|
—
|
|
|
424
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
424
|
|
|||||||
Tax Benefit for Exercises of
Stock Options |
—
|
|
|
68
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
68
|
|
|||||||
Purchase of Treasury Stock
(199,323 Shares) |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,877
|
)
|
|
(4,877
|
)
|
|||||||
Acquisition of Subsidiaries (9,356 Shares)
|
—
|
|
|
140
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
93
|
|
|
233
|
|
|||||||
Allocation of ESOP Stock (16,629 Shares)
|
—
|
|
|
59
|
|
|
—
|
|
|
350
|
|
|
—
|
|
|
—
|
|
|
409
|
|
|||||||
Balance at December 31, 2012
|
$
|
16,416
|
|
|
$
|
218,650
|
|
|
$
|
26,251
|
|
|
$
|
(2,150
|
)
|
|
$
|
(8,462
|
)
|
|
$
|
(74,880
|
)
|
|
$
|
175,825
|
|
ARROW FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY, Continued
(In Thousand
s, Except Share and Per Share Amounts)
|
|||||||||||||||||||||||||||
|
Common
Stock
|
|
Additional
Paid-In
Capital
|
|
Retained
Earnings
|
|
Unallo-cated ESOP
Shares
|
|
Accumu-lated
Other Com-
prehensive
Income
(Loss)
|
|
Treasury
Stock
|
|
Total
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance at December 31, 2012
|
$
|
16,416
|
|
|
$
|
218,650
|
|
|
$
|
26,251
|
|
|
$
|
(2,150
|
)
|
|
$
|
(8,462
|
)
|
|
$
|
(74,880
|
)
|
|
$
|
175,825
|
|
Net Income
|
—
|
|
|
—
|
|
|
21,795
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21,795
|
|
|||||||
Other Comprehensive (Loss) Income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,089
|
|
|
—
|
|
|
4,089
|
|
|||||||
2% Stock Dividend (328,323 Shares)
2
|
328
|
|
|
8,152
|
|
|
(8,480
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Cash Dividends Paid, $.99 per Share
1
|
—
|
|
|
—
|
|
|
(12,109
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(12,109
|
)
|
|||||||
Shares Issued for Stock Option Exercises, net
(58,719 Shares)
|
—
|
|
|
676
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
578
|
|
|
1,254
|
|
|||||||
Shares Issued Under the Directors’ Stock
Plan (7,643 Shares)
|
—
|
|
|
123
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
75
|
|
|
198
|
|
|||||||
Shares Issued Under the Employee Stock
Purchase Plan (19,679 Shares)
|
—
|
|
|
283
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
194
|
|
|
477
|
|
|||||||
Shares Issued for Dividend Reinvestment
Plans (49,574 Shares)
|
—
|
|
|
796
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
484
|
|
|
1,280
|
|
|||||||
Stock-Based Compensation Expense
|
—
|
|
|
372
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
372
|
|
|||||||
Tax Benefit for Exercises of
Stock Options
|
—
|
|
|
23
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
23
|
|
|||||||
Purchase of Treasury Stock
(68,361 Shares)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,709
|
)
|
|
(1,709
|
)
|
|||||||
Acquisition of Subsidiaries (9,503 Shares)
|
—
|
|
|
139
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
94
|
|
|
233
|
|
|||||||
Allocation of ESOP Stock (16,969 Shares)
|
—
|
|
|
76
|
|
|
—
|
|
|
350
|
|
|
—
|
|
|
—
|
|
|
426
|
|
|||||||
Balance at December 31, 2013
|
$
|
16,744
|
|
|
$
|
229,290
|
|
|
$
|
27,457
|
|
|
$
|
(1,800
|
)
|
|
$
|
(4,373
|
)
|
|
$
|
(75,164
|
)
|
|
$
|
192,154
|
|
|
Years Ended December 31,
|
||||||||||
Cash Flows from Operating Activities:
|
2013
|
|
2012
|
|
2011
|
||||||
Net Income
|
$
|
21,795
|
|
|
$
|
22,179
|
|
|
$
|
21,933
|
|
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities:
|
|
|
|
|
|
||||||
Provision for Loan Losses
|
200
|
|
|
845
|
|
|
845
|
|
|||
Depreciation and Amortization
|
8,870
|
|
|
8,856
|
|
|
6,509
|
|
|||
Allocation of ESOP Stock
|
426
|
|
|
409
|
|
|
428
|
|
|||
Gains on the Sale of Securities Available-for-Sale
|
(527
|
)
|
|
(949
|
)
|
|
(2,795
|
)
|
|||
Gains on the Sale of Securities Held-to-Maturity
|
(18
|
)
|
|
—
|
|
|
—
|
|
|||
Losses on the Sale of Securities Available-for-Sale
|
—
|
|
|
84
|
|
|
—
|
|
|||
Losses on the Sale of Securities Held-to-Maturity
|
5
|
|
|
—
|
|
|
—
|
|
|||
Loans Originated and Held-for-Sale
|
(46,101
|
)
|
|
(60,668
|
)
|
|
(39,111
|
)
|
|||
Proceeds from the Sale of Loans Held-for-Sale
|
50,298
|
|
|
61,041
|
|
|
49,378
|
|
|||
Net Gains on the Sale of Loans
|
(1,460
|
)
|
|
(2,282
|
)
|
|
(866
|
)
|
|||
Net Losses (Gains) on the Sale of Premises and Equipment,
Other Real Estate Owned and Repossessed Assets
|
120
|
|
|
(71
|
)
|
|
(32
|
)
|
|||
Contributions to Pension Plans
|
(473
|
)
|
|
(328
|
)
|
|
(5,319
|
)
|
|||
Deferred Income Tax Expense (Benefit)
|
294
|
|
|
(353
|
)
|
|
2,172
|
|
|||
Shares Issued Under the Directors
’
Stock Plan
|
198
|
|
|
175
|
|
|
175
|
|
|||
Stock-Based Compensation Expense
|
372
|
|
|
424
|
|
|
354
|
|
|||
Net Decrease in Other Assets
|
1,888
|
|
|
2,108
|
|
|
1,725
|
|
|||
Net Increase in Other Liabilities
|
786
|
|
|
990
|
|
|
689
|
|
|||
Net Cash Provided By Operating Activities
|
36,673
|
|
|
32,460
|
|
|
36,085
|
|
|||
Cash Flows from Investing Activities:
|
|
|
|
|
|
||||||
Proceeds from the Sale of Securities Available-for-Sale
|
16,295
|
|
|
58,718
|
|
|
39,009
|
|
|||
Proceeds from the Maturities and Calls of Securities Available-for-Sale
|
132,228
|
|
|
210,224
|
|
|
280,126
|
|
|||
Purchases of Securities Available-for-Sale
|
(136,416
|
)
|
|
(197,029
|
)
|
|
(354,310
|
)
|
|||
Proceeds from the Sale of Securities Held-to-Maturity
|
1,181
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from the Maturities and Calls of Securities Held-to-Maturity
|
47,228
|
|
|
49,983
|
|
|
40,692
|
|
|||
Purchases of Securities Held-to-Maturity
|
(109,620
|
)
|
|
(140,635
|
)
|
|
(31,701
|
)
|
|||
Net (Increase) Decrease in Loans
|
(98,903
|
)
|
|
(40,951
|
)
|
|
3,108
|
|
|||
Proceeds from the Sales of Premises and Equipment, Other
Real Estate Owned and Repossessed Assets
|
1,789
|
|
|
1,263
|
|
|
770
|
|
|||
Purchase of Premises and Equipment
|
(2,233
|
)
|
|
(8,073
|
)
|
|
(5,372
|
)
|
|||
Cash Paid for Subsidiaries, Net
|
(75
|
)
|
|
(75
|
)
|
|
(3,296
|
)
|
|||
Net (Increase) Decrease in Federal Home Loan Bank Stock
|
(489
|
)
|
|
930
|
|
|
1,880
|
|
|||
Purchase of Bank Owned Life Insurance
|
—
|
|
|
—
|
|
|
(15,702
|
)
|
|||
Net Cash Used In Investing Activities
|
(149,015
|
)
|
|
(65,645
|
)
|
|
(44,796
|
)
|
|||
Cash Flows from Financing Activities:
|
|
|
|
|
|
||||||
Net Increase in Deposits
|
111,175
|
|
|
87,109
|
|
|
110,042
|
|
|||
Net Increase (Decrease) in Short-Term Borrowings
|
23,099
|
|
|
(26,615
|
)
|
|
15,079
|
|
|||
Federal Home Loan Bank Advances
|
—
|
|
|
—
|
|
|
10,000
|
|
|||
Repayments of Federal Home Loan Bank Advances
|
(10,000
|
)
|
|
(10,000
|
)
|
|
(100,000
|
)
|
|||
Purchase of Treasury Stock
|
(1,709
|
)
|
|
(4,877
|
)
|
|
(6,039
|
)
|
|||
Shares Issued for Stock Option Exercises, net
|
1,254
|
|
|
2,105
|
|
|
1,413
|
|
|||
Shares Issued Under the Employee Stock Purchase Plan
|
477
|
|
|
484
|
|
|
474
|
|
|||
Tax Benefit for Exercises of Stock Options
|
23
|
|
|
68
|
|
|
51
|
|
|||
Shares Issued for Dividend Reinvestment Plans
|
1,280
|
|
|
1,822
|
|
|
1,796
|
|
|||
Cash Dividends Paid
|
(12,109
|
)
|
|
(11,815
|
)
|
|
(11,448
|
)
|
|||
Net Cash Provided By Financing Activities
|
113,490
|
|
|
38,281
|
|
|
21,368
|
|
|||
Net Increase in Cash and Cash Equivalents
|
1,148
|
|
|
5,096
|
|
|
12,657
|
|
|||
Cash and Cash Equivalents at Beginning of Year
|
48,832
|
|
|
43,736
|
|
|
31,079
|
|
|||
Cash and Cash Equivalents at End of Year
|
$
|
49,980
|
|
|
$
|
48,832
|
|
|
$
|
43,736
|
|
|
|
|
|
|
|
||||||
Supplemental Disclosures to Statements of Cash Flow Information:
|
|
|
|
|
|
||||||
Interest on Deposits and Borrowings
|
$
|
8,067
|
|
|
$
|
12,520
|
|
|
$
|
19,490
|
|
Income Taxes
|
8,336
|
|
|
8,866
|
|
|
7,952
|
|
|||
Non-cash Investing and Financing Activity:
|
|
|
|
|
|
||||||
Transfer of Loans to Other Real Estate Owned and Repossessed Assets
|
971
|
|
|
1,426
|
|
|
1,011
|
|
|||
Shares Issued for Acquisition of Subsidiary
|
233
|
|
|
233
|
|
|
5,261
|
|
|||
Fair Value of Assets from Acquisition of Subsidiary
|
—
|
|
|
—
|
|
|
10,638
|
|
|||
Fair Value of Liabilities from Acquisition of Subsidiary
|
—
|
|
|
—
|
|
|
2,081
|
|
Note 1:
|
RISKS AND UNCERTAINTIES
|
Note 2:
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
•
|
Level 1
–
Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;
|
•
|
Level 2
–
Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;
|
•
|
Level 3
–
Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity).
|
Note 3:
|
CASH AND CASH EQUIVALENTS (Dollars In Thousands)
|
|
2013
|
|
2012
|
||||
Cash and Due From Banks
|
$
|
37,275
|
|
|
$
|
37,076
|
|
Interest-Bearing Deposits at Banks
|
12,705
|
|
|
11,756
|
|
||
Total Cash and Cash Equivalents
|
$
|
49,980
|
|
|
$
|
48,832
|
|
Supplemental Information:
|
|
|
|
||||
Total required reserves, including vault cash and Federal Reserve Bank deposits
|
$
|
18,879
|
|
|
$
|
23,168
|
|
Note 4.
|
INVESTMENT SECURITIES (Dollars In Thousands)
|
Available-For-Sale Securities
|
||||||||||||||||||||||||
|
|
U.S. Agency
Obligations
|
|
State and
Municipal
Obligations
|
|
Mortgage-
Backed
Securities -
Residential
|
|
Corporate
and Other
Debt
Securities
|
|
Mutual Funds
and Equity
Securities
|
|
Total
Available-
For-Sale
Securities
|
||||||||||||
December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Available-For-Sale Securities,
at Amortized Cost
|
|
$
|
136,868
|
|
|
$
|
127,224
|
|
|
$
|
171,321
|
|
|
$
|
17,142
|
|
|
$
|
1,120
|
|
|
$
|
453,675
|
|
Available-For-Sale Securities,
at Fair Value
|
|
136,475
|
|
|
127,389
|
|
|
175,778
|
|
|
16,798
|
|
|
1,166
|
|
|
457,606
|
|
||||||
Gross Unrealized Gains
|
|
2
|
|
|
306
|
|
|
4,714
|
|
|
10
|
|
|
46
|
|
|
5,078
|
|
||||||
Gross Unrealized Losses
|
|
395
|
|
|
141
|
|
|
257
|
|
|
354
|
|
|
—
|
|
|
1,147
|
|
||||||
Available-For-Sale Securities,
Pledged as Collateral
|
|
|
|
|
|
|
|
|
|
|
|
243,769
|
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Maturities of Debt Securities,
at Amortized Cost:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Within One Year
|
|
—
|
|
|
48,570
|
|
|
10,920
|
|
|
—
|
|
|
|
|
59,490
|
|
|||||||
From 1 - 5 Years
|
|
136,868
|
|
|
76,308
|
|
|
146,677
|
|
|
16,142
|
|
|
|
|
375,995
|
|
|||||||
From 5 - 10 Years
|
|
—
|
|
|
1,666
|
|
|
13,608
|
|
|
—
|
|
|
|
|
15,274
|
|
|||||||
Over 10 Years
|
|
—
|
|
|
680
|
|
|
116
|
|
|
1,000
|
|
|
|
|
1,796
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Available-For-Sale Securities
|
||||||||||||||||||||||||
|
|
U.S. Agency
Obligations
|
|
State and
Municipal
Obligations
|
|
Mortgage-
Backed
Securities -
Residential
|
|
Corporate
and Other
Debt
Securities
|
|
Mutual Funds
and Equity
Securities
|
|
Total
Available-
For-Sale
Securities
|
||||||||||||
Maturities of Debt Securities,
at Fair Value:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Within One Year
|
|
—
|
|
|
48,623
|
|
|
11,181
|
|
|
—
|
|
|
|
|
59,804
|
|
|||||||
From 1 - 5 Years
|
|
136,475
|
|
|
76,405
|
|
|
150,330
|
|
|
15,998
|
|
|
|
|
379,208
|
|
|||||||
From 5 - 10 Years
|
|
—
|
|
|
1,681
|
|
|
14,146
|
|
|
—
|
|
|
|
|
15,827
|
|
|||||||
Over 10 Years
|
|
—
|
|
|
680
|
|
|
121
|
|
|
800
|
|
|
|
|
1,601
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Securities in a Continuous
Loss Position, at Fair Value:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Less than 12 Months
|
|
$
|
60,664
|
|
|
$
|
29,967
|
|
|
$
|
15,190
|
|
|
$
|
7,375
|
|
|
$
|
—
|
|
|
$
|
113,196
|
|
12 Months or Longer
|
|
33,849
|
|
|
4,597
|
|
|
11,841
|
|
|
6,063
|
|
|
—
|
|
|
56,350
|
|
||||||
Total
|
|
$
|
94,513
|
|
|
$
|
34,564
|
|
|
$
|
27,031
|
|
|
$
|
13,438
|
|
|
$
|
—
|
|
|
$
|
169,546
|
|
Number of Securities in a
Continuous Loss Position
|
|
26
|
|
|
107
|
|
|
13
|
|
|
19
|
|
|
—
|
|
|
165
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Unrealized Losses on
Securities in a Continuous
Loss Position:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Less than 12 Months
|
|
$
|
336
|
|
|
$
|
120
|
|
|
$
|
108
|
|
|
$
|
92
|
|
|
$
|
—
|
|
|
$
|
656
|
|
12 Months or Longer
|
|
59
|
|
|
21
|
|
|
149
|
|
|
262
|
|
|
—
|
|
|
491
|
|
||||||
Total
|
|
$
|
395
|
|
|
$
|
141
|
|
|
$
|
257
|
|
|
$
|
354
|
|
|
$
|
—
|
|
|
$
|
1,147
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Available-For-Sale Securities,
at Amortized Cost
|
|
$
|
122,297
|
|
|
$
|
84,798
|
|
|
$
|
252,480
|
|
|
$
|
8,689
|
|
|
$
|
1,120
|
|
|
$
|
469,384
|
|
Available-For-Sale Securities,
at Fair Value
|
|
122,457
|
|
|
84,838
|
|
|
261,804
|
|
|
8,451
|
|
|
1,148
|
|
|
478,698
|
|
||||||
Gross Unrealized Gains
|
|
204
|
|
|
206
|
|
|
9,405
|
|
|
—
|
|
|
28
|
|
|
9,843
|
|
||||||
Gross Unrealized Losses
|
|
44
|
|
|
166
|
|
|
81
|
|
|
238
|
|
|
—
|
|
|
529
|
|
||||||
Available-For-Sale Securities,
Pledged as Collateral
|
|
|
|
|
|
|
|
|
|
|
|
260,292
|
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Securities in a Continuous
Loss Position, at Fair Value:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Less than 12 Months
|
|
$
|
72,531
|
|
|
$
|
46,627
|
|
|
$
|
10,230
|
|
|
$
|
8,451
|
|
|
$
|
—
|
|
|
$
|
137,839
|
|
12 Months or Longer
|
|
—
|
|
|
2,149
|
|
|
4,968
|
|
|
—
|
|
|
—
|
|
|
7,117
|
|
||||||
Total
|
|
$
|
72,531
|
|
|
$
|
48,776
|
|
|
$
|
15,198
|
|
|
$
|
8,451
|
|
|
$
|
—
|
|
|
$
|
144,956
|
|
Number of Securities in a
Continuous Loss Position
|
|
22
|
|
|
198
|
|
|
7
|
|
|
11
|
|
|
—
|
|
|
238
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Unrealized Losses on
Securities in a Continuous
Loss Position:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Less than 12 Months
|
|
$
|
44
|
|
|
$
|
160
|
|
|
$
|
50
|
|
|
$
|
238
|
|
|
$
|
—
|
|
|
$
|
492
|
|
12 Months or Longer
|
|
—
|
|
|
6
|
|
|
31
|
|
|
—
|
|
|
—
|
|
|
37
|
|
||||||
Total
|
|
$
|
44
|
|
|
$
|
166
|
|
|
$
|
81
|
|
|
$
|
238
|
|
|
$
|
—
|
|
|
$
|
529
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Held-To-Maturity Securities
|
||||||||||||||||
|
|
State and
Municipal
Obligations
|
|
Mortgage-
Backed
Securities -
Residential
|
|
Corporate
and Other
Debt
Securities
|
|
Total
Held-To
Maturity
Securities
|
||||||||
December 31, 2013
|
|
|
|
|
|
|
|
|
||||||||
Held-To-Maturity Securities,
at Amortized Cost
|
|
$
|
198,206
|
|
|
$
|
100,055
|
|
|
$
|
1,000
|
|
|
$
|
299,261
|
|
Held-To-Maturity Securities,
at Fair Value
|
|
202,390
|
|
|
98,915
|
|
|
1,000
|
|
|
302,305
|
|
||||
Gross Unrealized Gains
|
|
4,762
|
|
|
24
|
|
|
—
|
|
|
4,786
|
|
||||
Gross Unrealized Losses
|
|
578
|
|
|
1,164
|
|
|
—
|
|
|
1,742
|
|
||||
Held-To-Maturity Securities,
Pledged as Collateral
|
|
|
|
|
|
|
|
298,261
|
|
|||||||
|
|
|
|
|
|
|
|
|
||||||||
Maturities of Debt Securities,
at Amortized Cost:
|
|
|
|
|
|
|
|
|
||||||||
Within One Year
|
|
43,043
|
|
|
—
|
|
|
—
|
|
|
43,043
|
|
||||
From 1 - 5 Years
|
|
82,001
|
|
|
41,958
|
|
|
—
|
|
|
123,959
|
|
||||
From 5 - 10 Years
|
|
69,832
|
|
|
58,097
|
|
|
—
|
|
|
127,929
|
|
||||
Over 10 Years
|
|
3,330
|
|
|
—
|
|
|
1,000
|
|
|
4,330
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Maturities of Debt Securities,
at Fair Value:
|
|
|
|
|
|
|
|
|
||||||||
Within One Year
|
|
43,113
|
|
|
—
|
|
|
—
|
|
|
43,113
|
|
||||
From 1 - 5 Years
|
|
83,896
|
|
|
41,788
|
|
|
—
|
|
|
125,684
|
|
||||
From 5 - 10 Years
|
|
71,967
|
|
|
57,127
|
|
|
—
|
|
|
129,094
|
|
||||
Over 10 Years
|
|
3,414
|
|
|
—
|
|
|
1,000
|
|
|
4,414
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Securities in a Continuous
Loss Position, at Fair Value:
|
|
|
|
|
|
|
|
|
||||||||
Less than 12 Months
|
|
$
|
23,633
|
|
|
$
|
85,339
|
|
|
$
|
—
|
|
|
$
|
108,972
|
|
12 Months or Longer
|
|
5,111
|
|
|
—
|
|
|
—
|
|
|
5,111
|
|
||||
Total
|
|
$
|
28,744
|
|
|
$
|
85,339
|
|
|
$
|
—
|
|
|
$
|
114,083
|
|
Number of Securities in a
Continuous Loss Position
|
|
101
|
|
|
36
|
|
|
—
|
|
|
137
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Unrealized Losses on
Securities in a Continuous
Loss Position:
|
|
|
|
|
|
|
|
|
||||||||
Less than 12 Months
|
|
$
|
519
|
|
|
$
|
1,164
|
|
|
$
|
—
|
|
|
$
|
1,683
|
|
12 Months or Longer
|
|
59
|
|
|
—
|
|
|
—
|
|
|
59
|
|
||||
Total
|
|
$
|
578
|
|
|
$
|
1,164
|
|
|
$
|
—
|
|
|
$
|
1,742
|
|
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2012
|
|
|
|
|
|
|
|
|
||||||||
Held-To-Maturity Securities,
at Amortized Cost
|
|
$
|
183,373
|
|
|
$
|
55,430
|
|
|
$
|
1,000
|
|
|
$
|
239,803
|
|
Held-To-Maturity Securities,
at Fair Value
|
|
191,196
|
|
|
56,056
|
|
|
1,000
|
|
|
248,252
|
|
||||
Gross Unrealized Gains
|
|
7,886
|
|
|
626
|
|
|
—
|
|
|
8,512
|
|
||||
Gross Unrealized Losses
|
|
63
|
|
|
—
|
|
|
—
|
|
|
63
|
|
||||
Held-To-Maturity Securities,
Pledged as Collateral
|
|
|
|
|
|
|
|
238,803
|
|
|||||||
|
|
|
|
|
|
|
|
|
Held-To-Maturity Securities
|
||||||||||||||||
|
|
State and
Municipal
Obligations
|
|
Mortgage-
Backed
Securities -
Residential
|
|
Corporate
and Other
Debt
Securities
|
|
Total
Held-To
Maturity
Securities
|
||||||||
Securities in a Continuous
Loss Position, at Fair Value:
|
|
|
|
|
|
|
|
|
||||||||
Less than 12 Months
|
|
$
|
21,583
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
21,583
|
|
12 Months or Longer
|
|
503
|
|
|
—
|
|
|
—
|
|
|
503
|
|
||||
Total
|
|
$
|
22,086
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
22,086
|
|
Number of Securities in a
Continuous Loss Position
|
|
61
|
|
|
—
|
|
|
—
|
|
|
61
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Unrealized Losses on
Securities in a Continuous
Loss Position:
|
|
|
|
|
|
|
|
|
||||||||
Less than 12 Months
|
|
$
|
62
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
62
|
|
12 Months or Longer
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||
Total
|
|
$
|
63
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
63
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
||||||
|
2013
|
|
2012
|
||||
Federal Reserve Bank Stock
|
$
|
1,035
|
|
|
$
|
1,018
|
|
Federal Home Loan Bank Stock
|
5,246
|
|
|
4,774
|
|
||
Total Federal Reserve Bank and Federal Home Loan Bank Stock
|
$
|
6,281
|
|
|
$
|
5,792
|
|
Note 5:
|
LOANS (Dollars In Thousands)
|
Schedule of Past Due Loans by Loan Category
|
|||||||||||||||||||||||||||
|
|
|
Commercial
|
|
Commercial
|
|
Other
|
|
|
|
|
|
|
||||||||||||||
|
Commercial
|
|
Construction
|
|
Real Estate
|
|
Consumer
|
|
Automobile
|
|
Residential
|
|
Total
|
||||||||||||||
December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Loans Past Due 30-59 Days
|
$
|
304
|
|
|
$
|
—
|
|
|
$
|
200
|
|
|
$
|
37
|
|
|
$
|
3,233
|
|
|
$
|
529
|
|
|
$
|
4,303
|
|
Loans Past Due 60-89 Days
|
601
|
|
|
—
|
|
|
1,200
|
|
|
19
|
|
|
1,041
|
|
|
1,527
|
|
|
4,388
|
|
|||||||
Loans Past Due 90 or More Days
|
177
|
|
|
—
|
|
|
2,034
|
|
|
—
|
|
|
98
|
|
|
3,113
|
|
|
5,422
|
|
|||||||
Total Loans Past Due
|
1,082
|
|
|
—
|
|
|
3,434
|
|
|
56
|
|
|
4,372
|
|
|
5,169
|
|
|
14,113
|
|
|||||||
Current Loans
|
86,811
|
|
|
27,815
|
|
|
284,685
|
|
|
7,593
|
|
|
389,832
|
|
|
455,623
|
|
|
1,252,359
|
|
|||||||
Total Loans
|
$
|
87,893
|
|
|
$
|
27,815
|
|
|
$
|
288,119
|
|
|
$
|
7,649
|
|
|
$
|
394,204
|
|
|
$
|
460,792
|
|
|
$
|
1,266,472
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Loans 90 or More Days Past Due and Still Accruing Interest
|
$
|
28
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
624
|
|
|
$
|
652
|
|
Nonaccrual Loans
|
$
|
352
|
|
|
$
|
—
|
|
|
$
|
2,048
|
|
|
$
|
—
|
|
|
$
|
219
|
|
|
$
|
3,860
|
|
|
$
|
6,479
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Loans Past Due 30-59 Days
|
$
|
1,045
|
|
|
$
|
—
|
|
|
$
|
534
|
|
|
$
|
43
|
|
|
$
|
2,427
|
|
|
$
|
407
|
|
|
$
|
4,456
|
|
Loans Past Due 60-89 Days
|
1,588
|
|
|
—
|
|
|
1,332
|
|
|
17
|
|
|
793
|
|
|
2,466
|
|
|
6,196
|
|
|||||||
Loans Past Due 90 or more Days
|
494
|
|
|
—
|
|
|
1,871
|
|
|
—
|
|
|
185
|
|
|
1,462
|
|
|
4,012
|
|
|||||||
Total Loans Past Due
|
3,127
|
|
|
—
|
|
|
3,737
|
|
|
60
|
|
|
3,405
|
|
|
4,335
|
|
|
14,664
|
|
|||||||
Current Loans
|
102,409
|
|
|
29,149
|
|
|
241,440
|
|
|
6,624
|
|
|
345,695
|
|
|
432,360
|
|
|
1,157,677
|
|
|||||||
Total Loans
|
$
|
105,536
|
|
|
$
|
29,149
|
|
|
$
|
245,177
|
|
|
$
|
6,684
|
|
|
$
|
349,100
|
|
|
$
|
436,695
|
|
|
$
|
1,172,341
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Loans 90 or More Days Past Due and Still Accruing Interest
|
$
|
126
|
|
|
$
|
—
|
|
|
$
|
378
|
|
|
$
|
—
|
|
|
$
|
42
|
|
|
$
|
374
|
|
|
$
|
920
|
|
Nonaccrual Loans
|
$
|
1,787
|
|
|
$
|
—
|
|
|
$
|
2,026
|
|
|
$
|
1
|
|
|
$
|
419
|
|
|
$
|
2,400
|
|
|
$
|
6,633
|
|
Allowance for Loan Losses
|
|||||||||||||||||||||||||||||||
|
|
|
Commercial
|
|
Commercial
|
|
Other
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Commercial
|
|
Construction
|
|
Real Estate
|
|
Consumer
|
|
Automobile
|
|
Residential
|
|
Unallocated
|
|
Total
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Rollfoward of the Allowance for Loan Losses for the Year Ended:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
December 31, 2012
|
$
|
2,344
|
|
|
$
|
601
|
|
|
$
|
3,050
|
|
|
$
|
304
|
|
|
$
|
4,536
|
|
|
$
|
3,405
|
|
|
$
|
1,058
|
|
|
$
|
15,298
|
|
Charge-offs
|
(926
|
)
|
|
—
|
|
|
(11
|
)
|
|
(28
|
)
|
|
(431
|
)
|
|
(15
|
)
|
|
—
|
|
|
(1,411
|
)
|
||||||||
Recoveries
|
88
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
256
|
|
|
—
|
|
|
—
|
|
|
347
|
|
||||||||
Provision
|
380
|
|
|
(184
|
)
|
|
506
|
|
|
(7
|
)
|
|
(155
|
)
|
|
(364
|
)
|
|
24
|
|
|
200
|
|
||||||||
December 31, 2013
|
$
|
1,886
|
|
|
$
|
417
|
|
|
$
|
3,545
|
|
|
$
|
272
|
|
|
$
|
4,206
|
|
|
$
|
3,026
|
|
|
$
|
1,082
|
|
|
$
|
14,434
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
December 31, 2011
|
$
|
1,927
|
|
|
$
|
602
|
|
|
$
|
3,136
|
|
|
$
|
350
|
|
|
$
|
4,496
|
|
|
$
|
3,414
|
|
|
$
|
1,078
|
|
|
$
|
15,003
|
|
Charge-offs
|
(90
|
)
|
|
—
|
|
|
(206
|
)
|
|
(52
|
)
|
|
(401
|
)
|
|
(33
|
)
|
|
—
|
|
|
(782
|
)
|
||||||||
Recoveries
|
23
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
200
|
|
|
—
|
|
|
—
|
|
|
232
|
|
||||||||
Provision
|
484
|
|
|
(1
|
)
|
|
120
|
|
|
(3
|
)
|
|
241
|
|
|
24
|
|
|
(20
|
)
|
|
845
|
|
||||||||
December 31, 2012
|
$
|
2,344
|
|
|
$
|
601
|
|
|
$
|
3,050
|
|
|
$
|
304
|
|
|
$
|
4,536
|
|
|
$
|
3,405
|
|
|
$
|
1,058
|
|
|
$
|
15,298
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
December 31, 2010
|
$
|
2,037
|
|
|
$
|
135
|
|
|
$
|
2,993
|
|
|
$
|
328
|
|
|
$
|
4,760
|
|
|
$
|
3,163
|
|
|
$
|
1,273
|
|
|
$
|
14,689
|
|
Charge-offs
|
(105
|
)
|
|
—
|
|
|
—
|
|
|
(42
|
)
|
|
(480
|
)
|
|
(147
|
)
|
|
—
|
|
|
(774
|
)
|
||||||||
Recoveries
|
17
|
|
|
—
|
|
|
—
|
|
|
28
|
|
|
198
|
|
|
—
|
|
|
—
|
|
|
243
|
|
||||||||
Provision
|
(22
|
)
|
|
467
|
|
|
143
|
|
|
36
|
|
|
18
|
|
|
398
|
|
|
(195
|
)
|
|
845
|
|
||||||||
December 31, 2011
|
$
|
1,927
|
|
|
$
|
602
|
|
|
$
|
3,136
|
|
|
$
|
350
|
|
|
$
|
4,496
|
|
|
$
|
3,414
|
|
|
$
|
1,078
|
|
|
$
|
15,003
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for Loan Losses
|
|||||||||||||||||||||||||||||||
|
|
|
Commercial
|
|
Commercial
|
|
Other
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Commercial
|
|
Construction
|
|
Real Estate
|
|
Consumer
|
|
Automobile
|
|
Residential
|
|
Unallocated
|
|
Total
|
||||||||||||||||
December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Allowance for loan losses - Loans Individually Evaluated for Impairment
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Allowance for loan losses - Loans Collectively Evaluated for Impairment
|
$
|
1,886
|
|
|
$
|
417
|
|
|
$
|
3,545
|
|
|
$
|
272
|
|
|
$
|
4,206
|
|
|
$
|
3,026
|
|
|
$
|
1,082
|
|
|
$
|
14,434
|
|
Ending Loan Balance - Individually Evaluated for Impairment
|
$
|
221
|
|
|
$
|
—
|
|
|
$
|
1,785
|
|
|
$
|
—
|
|
|
$
|
173
|
|
|
$
|
2,309
|
|
|
$
|
—
|
|
|
$
|
4,488
|
|
Ending Loan Balance - Collectively Evaluated for Impairment
|
$
|
87,672
|
|
|
$
|
27,815
|
|
|
$
|
286,334
|
|
|
$
|
7,649
|
|
|
$
|
394,031
|
|
|
$
|
458,483
|
|
|
$
|
—
|
|
|
$
|
1,261,984
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Allowance for loan losses - Loans Individually Evaluated for Impairment
|
$
|
853
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
853
|
|
Allowance for loan losses - Loans Collectively Evaluated for Impairment
|
$
|
1,491
|
|
|
$
|
601
|
|
|
$
|
3,050
|
|
|
$
|
304
|
|
|
$
|
4,536
|
|
|
$
|
3,405
|
|
|
$
|
1,058
|
|
|
$
|
14,445
|
|
Ending Loan Balance - Individually Evaluated for Impairment
|
$
|
1,432
|
|
|
$
|
—
|
|
|
$
|
2,528
|
|
|
$
|
—
|
|
|
$
|
203
|
|
|
$
|
1,090
|
|
|
$
|
—
|
|
|
$
|
5,253
|
|
Ending Loan Balance - Collectively Evaluated for Impairment
|
$
|
104,104
|
|
|
$
|
29,149
|
|
|
$
|
242,649
|
|
|
$
|
6,684
|
|
|
$
|
348,897
|
|
|
$
|
435,605
|
|
|
$
|
—
|
|
|
$
|
1,167,088
|
|
•
|
Changes in the volume and severity of past due, nonaccrual and adversely classified loans
|
•
|
Changes in the nature and volume of the portfolio and in the terms of loans
|
•
|
Changes in the value of the underlying collateral for collateral dependent loans
|
•
|
Changes in lending policies and procedures, including changes in underwriting standards and collection, charge-off, and recovery practices not considered elsewhere in estimating credit losses
|
•
|
Changes in the quality of the loan review system
|
•
|
Changes in the experience, ability, and depth of lending management and other relevant staff
|
•
|
Changes in international, national, regional, and local economic and business conditions and developments that affect the collectibility of the portfolio
|
•
|
The existence and effect of any concentrations of credit, and changes in the level of such concentrations
|
•
|
The effect of other external factors such as competition and legal and regulatory requirements on the level of estimated credit losses in the existing portfolio or pool
|
Loan Credit Quality Indicators
|
|||||||||||||||||||||||||||
|
|
|
Commercial
|
|
Commercial
|
|
Other
|
|
|
|
|
|
|
||||||||||||||
|
Commercial
|
|
Construction
|
|
Real Estate
|
|
Consumer
|
|
Automobile
|
|
Residential
|
|
Total
|
||||||||||||||
December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Credit Risk Profile by Creditworthiness Category:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Satisfactory
|
$
|
79,966
|
|
|
$
|
27,815
|
|
|
$
|
267,612
|
|
|
|
|
|
|
|
|
$
|
375,393
|
|
||||||
Special Mention
|
204
|
|
|
—
|
|
|
634
|
|
|
|
|
|
|
|
|
838
|
|
||||||||||
Substandard
|
7,723
|
|
|
—
|
|
|
19,873
|
|
|
|
|
|
|
|
|
27,596
|
|
||||||||||
Doubtful
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
—
|
|
||||||||||
Credit Risk Profile Based on Payment Activity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Performing
|
|
|
|
|
|
|
$
|
7,649
|
|
|
$
|
393,985
|
|
|
$
|
456,308
|
|
|
857,942
|
|
|||||||
Nonperforming
|
|
|
|
|
|
|
—
|
|
|
219
|
|
|
4,484
|
|
|
4,703
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Credit Risk Profile by Creditworthiness Category:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Satisfactory
|
$
|
97,085
|
|
|
$
|
27,913
|
|
|
$
|
225,312
|
|
|
|
|
|
|
|
|
$
|
350,310
|
|
||||||
Special Mention
|
192
|
|
|
—
|
|
|
1,419
|
|
|
|
|
|
|
|
|
1,611
|
|
||||||||||
Substandard
|
6,872
|
|
|
1,236
|
|
|
18,446
|
|
|
|
|
|
|
|
|
26,554
|
|
||||||||||
Doubtful
|
1,387
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
1,387
|
|
||||||||||
Credit Risk Profile Based on Payment Activity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Performing
|
|
|
|
|
|
|
$
|
6,683
|
|
|
$
|
348,676
|
|
|
$
|
433,922
|
|
|
$
|
789,281
|
|
||||||
Nonperforming
|
|
|
|
|
|
|
1
|
|
|
424
|
|
|
2,773
|
|
|
3,198
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impaired Loans
|
|||||||||||||||||||||||||||
|
|
|
Commercial
|
|
Commercial
|
|
Other
|
|
|
|
|
|
|
||||||||||||||
|
Commercial
|
|
Construction
|
|
Real Estate
|
|
Consumer
|
|
Automobile
|
|
Residential
|
|
Total
|
||||||||||||||
December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Recorded Investment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
With No Related Allowance
|
$
|
221
|
|
|
$
|
—
|
|
|
$
|
1,785
|
|
|
$
|
—
|
|
|
$
|
173
|
|
|
$
|
2,309
|
|
|
$
|
4,488
|
|
With a Related Allowance
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Unpaid Principal Balance:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
With No Related Allowance
|
$
|
221
|
|
|
$
|
—
|
|
|
$
|
1,785
|
|
|
$
|
—
|
|
|
$
|
173
|
|
|
$
|
2,309
|
|
|
$
|
4,488
|
|
With a Related Allowance
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Recorded Investment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
With No Related Allowance
|
$
|
45
|
|
|
$
|
—
|
|
|
$
|
2,528
|
|
|
$
|
—
|
|
|
$
|
203
|
|
|
$
|
1,090
|
|
|
$
|
3,866
|
|
With a Related Allowance
|
1,387
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
1,387
|
|
||||||
Unpaid Principal Balance:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
With No Related Allowance
|
$
|
45
|
|
|
$
|
—
|
|
|
$
|
2,695
|
|
|
$
|
—
|
|
|
$
|
203
|
|
|
$
|
1,090
|
|
|
$
|
4,033
|
|
With a Related Allowance
|
1,387
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
1,387
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
For the Year-To-Date Period Ended:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Average Recorded Balance:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
With No Related Allowance
|
$
|
133
|
|
|
$
|
—
|
|
|
$
|
2,157
|
|
|
$
|
—
|
|
|
$
|
188
|
|
|
$
|
1,700
|
|
|
$
|
4,178
|
|
With a Related Allowance
|
694
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
694
|
|
|||||||
Interest Income Recognized:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
With No Related Allowance
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
9
|
|
|
$
|
8
|
|
|
$
|
21
|
|
With a Related Allowance
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Cash Basis Income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
With No Related Allowance
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
With a Related Allowance
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Average Recorded Balance:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
With No Related Allowance
|
$
|
56
|
|
|
$
|
—
|
|
|
$
|
2,241
|
|
|
$
|
—
|
|
|
$
|
236
|
|
|
$
|
1,599
|
|
|
$
|
4,132
|
|
With a Related Allowance
|
694
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
694
|
|
||||||
Interest Income Recognized:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
With No Related Allowance
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
64
|
|
|
$
|
—
|
|
|
$
|
12
|
|
|
$
|
9
|
|
|
$
|
91
|
|
With a Related Allowance
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
—
|
|
||||||
Cash Basis Income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
With No Related Allowance
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
64
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
64
|
|
With a Related Allowance
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
—
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Average Recorded Balance:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
With No Related Allowance
|
$
|
40
|
|
|
$
|
—
|
|
|
$
|
1,993
|
|
|
$
|
5
|
|
|
$
|
274
|
|
|
$
|
1,328
|
|
|
$
|
3,640
|
|
Interest Income Recognized:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
With No Related Allowance
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
42
|
|
|
$
|
—
|
|
|
$
|
19
|
|
|
$
|
7
|
|
|
$
|
74
|
|
Cash Basis Income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
With No Related Allowance
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
42
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
42
|
|
Loans Modified in Trouble Debt Restructurings During the Period
|
|||||||||||||||||||||||||||
|
|
|
Commercial
|
|
Commercial
|
|
Other
|
|
|
|
|
|
|
||||||||||||||
|
Commercial
|
|
Construction
|
|
Real Estate
|
|
Consumer
|
|
Automobile
|
|
Residential
|
|
Total
|
||||||||||||||
For the Year Ended:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Number of Loans
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
—
|
|
|
10
|
|
|||||||
Pre-Modification Outstanding Recorded Investment
|
$
|
169
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
88
|
|
|
$
|
—
|
|
|
$
|
257
|
|
Post-Modification Outstanding Recorded Investment
|
$
|
200
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
88
|
|
|
$
|
—
|
|
|
$
|
288
|
|
Subsequent Default, Number of Contracts
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Subsequent Default, Recorded Investment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Commitments to lend additional funds to modified loans
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Number of Loans
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
19
|
|
|||||||
Pre-Modification Outstanding Recorded Investment
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
47
|
|
|
$
|
—
|
|
|
$
|
160
|
|
|
$
|
—
|
|
|
$
|
207
|
|
Post-Modification Outstanding Recorded Investment
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
47
|
|
|
$
|
—
|
|
|
$
|
160
|
|
|
$
|
—
|
|
|
$
|
207
|
|
Subsequent Default, Number of Contracts
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Subsequent Default, Recorded Investment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Commitments to lend additional funds to modified loans
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Number of Loans
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
14
|
|
|
1
|
|
|
17
|
|
|||||||
Pre-Modification Outstanding Recorded Investment
|
$
|
63
|
|
|
$
|
—
|
|
|
$
|
917
|
|
|
$
|
—
|
|
|
$
|
121
|
|
|
$
|
242
|
|
|
$
|
1,343
|
|
Post-Modification Outstanding Recorded Investment
|
$
|
63
|
|
|
$
|
—
|
|
|
$
|
917
|
|
|
$
|
—
|
|
|
$
|
121
|
|
|
$
|
242
|
|
|
$
|
1,343
|
|
Subsequent Default, Number of Contracts
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Subsequent Default, Recorded Investment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Commitments to lend additional funds to modified loans
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2013
|
|
2012
|
||||
Supplemental Information
:
|
|
|
|
||||
Unamortized deferred loan origination costs, net of deferred loan
origination fees, included in the above balances
|
$
|
2,152
|
|
|
$
|
1,571
|
|
Overdrawn deposit accounts, included in the above balances
|
501
|
|
|
690
|
|
||
Pledged loans secured by one-to-four family residential mortgages
under a blanket collateral agreement to secure borrowings from
the Federal Home Loan Bank of New York
|
270,372
|
|
|
133,709
|
|
||
Residential real estate loans serviced for Freddie Mac, not included
in the balances above
|
156,593
|
|
|
134,688
|
|
||
Loans held for sale at period-end, included in the above balances
|
64
|
|
|
2,801
|
|
||
Loans to Related Parties:
|
|
|
|
||||
Balance at beginning of year
|
$
|
17,447
|
|
|
$
|
15,772
|
|
Adjustment due to change in composition of related parties
|
(8,819
|
)
|
|
45
|
|
||
New loans and renewals, during the year
|
2,253
|
|
|
5,939
|
|
||
Repayments, during the year
|
(3,112
|
)
|
|
(4,309
|
)
|
||
Balance at end of year
|
$
|
7,769
|
|
|
$
|
17,447
|
|
Note 6:
|
PREMISES AND EQUIPMENT (In Thousands)
|
|
2013
|
|
2012
|
||||
Land and Bank Premises
|
$
|
35,114
|
|
|
$
|
33,908
|
|
Equipment, Furniture and Fixtures
|
20,851
|
|
|
20,123
|
|
||
Leasehold Improvements
|
1,190
|
|
|
957
|
|
||
Total Cost
|
57,155
|
|
|
54,988
|
|
||
Accumulated Depreciation and Amortization
|
(28,001
|
)
|
|
(26,091
|
)
|
||
Net Premises and Equipment
|
$
|
29,154
|
|
|
$
|
28,897
|
|
Note 7:
|
OTHER INTANGIBLE ASSETS (In Thousands)
|
|
Depositor
Intangibles
1
|
|
Mortgage
Servicing
Rights
2
|
|
Customer Intangibles
1
|
|
Total
|
||||||||
Gross Carrying Amount, December 31, 2013
|
$
|
2,247
|
|
|
$
|
1,582
|
|
|
$
|
4,451
|
|
|
$
|
8,280
|
|
Accumulated Amortization
|
(2,186
|
)
|
|
(622
|
)
|
|
(1,332
|
)
|
|
(4,140
|
)
|
||||
Net Carrying Amount, December 31, 2013
|
$
|
61
|
|
|
$
|
960
|
|
|
$
|
3,119
|
|
|
$
|
4,140
|
|
Gross Carrying Amount, December 31, 2012
|
$
|
2,247
|
|
|
$
|
1,251
|
|
|
$
|
4,451
|
|
|
$
|
7,949
|
|
Accumulated Amortization
|
(2,094
|
)
|
|
(392
|
)
|
|
(971
|
)
|
|
(3,457
|
)
|
||||
Net Carrying Amount, December 31, 2012
|
$
|
153
|
|
|
$
|
859
|
|
|
$
|
3,480
|
|
|
$
|
4,492
|
|
|
|
|
|
|
|
|
|
||||||||
Rollforward of Intangible Assets:
|
|
|
|
|
|
|
|
||||||||
Balance, December 31, 2010
|
$
|
460
|
|
|
$
|
371
|
|
|
$
|
627
|
|
|
$
|
1,458
|
|
Intangible Assets Acquired
|
—
|
|
|
339
|
|
|
3,573
|
|
|
3,912
|
|
||||
Amortization of Intangible Assets
|
(174
|
)
|
|
(111
|
)
|
|
(336
|
)
|
|
(621
|
)
|
||||
Balance, December 31, 2011
|
286
|
|
|
599
|
|
|
3,864
|
|
|
4,749
|
|
||||
Intangible Assets Acquired
|
—
|
|
|
417
|
|
|
—
|
|
|
417
|
|
||||
Amortization of Intangible Assets
|
(133
|
)
|
|
(157
|
)
|
|
(384
|
)
|
|
(674
|
)
|
||||
Balance, December 31, 2012
|
153
|
|
|
859
|
|
|
3,480
|
|
|
4,492
|
|
||||
Intangible Assets Acquired
|
—
|
|
|
331
|
|
|
—
|
|
|
331
|
|
||||
Amortization of Intangible Assets
|
(92
|
)
|
|
(230
|
)
|
|
(361
|
)
|
|
(683
|
)
|
||||
Balance, December 31, 2013
|
$
|
61
|
|
|
$
|
960
|
|
|
$
|
3,119
|
|
|
$
|
4,140
|
|
|
Depositor
Intangibles
1
|
|
Mortgage
Servicing
Rights
2
|
|
Customer Intangibles
1
|
|
Total
|
||||||||
Estimated Annual Amortization Expense:
|
|
|
|
|
|
|
|||||||||
2014
|
$
|
51
|
|
|
$
|
253
|
|
|
$
|
337
|
|
|
$
|
641
|
|
2015
|
10
|
|
|
230
|
|
|
319
|
|
|
559
|
|
||||
2016
|
—
|
|
|
209
|
|
|
301
|
|
|
510
|
|
||||
2017
|
—
|
|
|
150
|
|
|
281
|
|
|
431
|
|
||||
2018
|
—
|
|
|
96
|
|
|
263
|
|
|
359
|
|
||||
Later Years
|
—
|
|
|
22
|
|
|
1,618
|
|
|
1,640
|
|
||||
Total
|
$
|
61
|
|
|
$
|
960
|
|
|
$
|
3,119
|
|
|
$
|
4,140
|
|
Note 8:
|
GUARANTEES (Dollars In Thousands)
|
Balance at December 31,
|
2013
|
|
2012
|
||||
Notional Amount:
|
|
|
|
||||
Commitments to Extend Credit
|
$
|
237,940
|
|
|
$
|
198,405
|
|
Standby Letters of Credit
|
3,345
|
|
|
10,929
|
|
||
Fair Value:
|
|
|
|
||||
Commitments to Extend Credit
|
$
|
—
|
|
|
$
|
—
|
|
Standby Letters of Credit
|
65
|
|
|
120
|
|
Note 9:
|
TIME DEPOSITS (Dollars In Thousands)
|
Year of Maturity
|
Total Time
Deposits
|
||
2014
|
$
|
163,032
|
|
2015
|
31,277
|
|
|
2016
|
17,450
|
|
|
2017
|
18,418
|
|
|
2018
|
13,076
|
|
|
2019 and Beyond
|
3,974
|
|
|
Total
|
$
|
247,227
|
|
Note 10:
|
DEBT (Dollars in Thousands)
|
|
2013
|
|
2012
|
||||
Balances at December 31:
|
|
|
|
||||
Overnight Advances from the Federal Home Loan Bank of New York
|
$
|
53,000
|
|
|
$
|
29,000
|
|
Securities Sold Under Agreements to Repurchase
|
11,777
|
|
|
12,678
|
|
||
Total Short-Term Borrowings
|
$
|
64,777
|
|
|
$
|
41,678
|
|
|
|
|
|
||||
Maximum Borrowing Capacity at December 31:
|
|
|
|
||||
Federal Funds Purchased
|
$
|
30,000
|
|
|
$
|
30,000
|
|
Overnight Advances from the Federal Home Loan Bank of New York
|
214,000
|
|
|
90,000
|
|
||
Federal Reserve Bank of New York
|
302,000
|
|
|
268,000
|
|
|
|
Balances
|
|
Weighted Average Rate
|
||||||||||
|
|
|
|
|
|
|
|
|
||||||
Final Maturity
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||
First Year
|
|
$
|
10,000
|
|
|
$
|
10,000
|
|
|
1.43
|
%
|
|
1.65
|
%
|
Second Year
|
|
10,000
|
|
|
10,000
|
|
|
3.88
|
%
|
|
1.43
|
%
|
||
Third Year
|
|
—
|
|
|
10,000
|
|
|
—
|
%
|
|
3.88
|
%
|
||
Total
|
|
$
|
20,000
|
|
|
$
|
30,000
|
|
|
2.66
|
%
|
|
2.32
|
%
|
|
2013
|
|
2012
|
||||
ACST II
|
|
|
|
||||
Balance at December 31,
|
$
|
10,000
|
|
|
$
|
10,000
|
|
Period-End Interest Rate
|
3.40
|
%
|
|
3.51
|
%
|
||
|
|
|
|
||||
ACST III
|
|
|
|
||||
Balance at December 31,
|
$
|
10,000
|
|
|
$
|
10,000
|
|
Period-End Interest Rate
|
2.25
|
%
|
|
2.36
|
%
|
Note 11:
|
COMPREHENSIVE INCOME (Dollars In Thousands)
|
Schedule of Comprehensive Income
|
|||||||||||
|
Before-Tax
Amount
|
|
Tax
(Expense)
Benefit
|
|
Net-of-Tax
Amount
|
||||||
2013
|
|
|
|
|
|
||||||
Net Unrealized Securities Holding Gains Arising During the Period
|
$
|
(4,843
|
)
|
|
$
|
1,918
|
|
|
$
|
(2,925
|
)
|
Reclassification Adjustment for Securities Gains Included in Net Income
|
(540
|
)
|
|
214
|
|
|
(326
|
)
|
|||
Net Retirement Plan Loss
|
10,640
|
|
|
(4,215
|
)
|
|
6,425
|
|
|||
Amortization of Net Retirement Plan Actuarial Loss
|
1,513
|
|
|
(599
|
)
|
|
914
|
|
|||
Accretion of Net Retirement Plan Prior Service Credit
|
2
|
|
|
(1
|
)
|
|
1
|
|
|||
Other Comprehensive Income
|
$
|
6,772
|
|
|
$
|
(2,683
|
)
|
|
$
|
4,089
|
|
|
|
|
|
|
|
||||||
2012
|
|
|
|
|
|
||||||
Net Unrealized Securities Holding Gains Arising During the Period
|
$
|
(1,094
|
)
|
|
$
|
433
|
|
|
$
|
(661
|
)
|
Reclassification Adjustment for Securities Gains Included in Net Income
|
(865
|
)
|
|
343
|
|
|
(522
|
)
|
|||
Net Retirement Plan Loss
|
(2,218
|
)
|
|
878
|
|
|
(1,340
|
)
|
|||
Net Retirement Plan Prior Service Credit
|
(405
|
)
|
|
160
|
|
|
(245
|
)
|
|||
Amortization of Net Retirement Plan Actuarial Loss
|
1,677
|
|
|
(664
|
)
|
|
1,013
|
|
|||
Accretion of Net Retirement Plan Prior Service Credit
|
(20
|
)
|
|
8
|
|
|
(12
|
)
|
|||
Other Comprehensive Income
|
$
|
(2,925
|
)
|
|
$
|
1,158
|
|
|
$
|
(1,767
|
)
|
|
|
|
|
|
|
||||||
2011
|
|
|
|
|
|
||||||
Net Unrealized Securities Holding Gains Arising During the Period
|
$
|
7,850
|
|
|
$
|
(3,109
|
)
|
|
$
|
4,741
|
|
Reclassification Adjustment for Securities Gains Included in Net Income
|
(2,795
|
)
|
|
1,107
|
|
|
(1,688
|
)
|
|||
Net Retirement Plan Loss
|
(6,129
|
)
|
|
2,428
|
|
|
(3,701
|
)
|
|||
Net Retirement Plan Prior Service Credit
|
(266
|
)
|
|
105
|
|
|
(161
|
)
|
|||
Amortization of Net Retirement Plan Actuarial Loss
|
996
|
|
|
(394
|
)
|
|
602
|
|
|||
Accretion of Net Retirement Plan Prior Service Credit
|
(108
|
)
|
|
43
|
|
|
(65
|
)
|
|||
Other Comprehensive Income
|
$
|
(452
|
)
|
|
$
|
180
|
|
|
$
|
(272
|
)
|
Changes in Accumulated Other Comprehensive Income (Loss) by Component
(1)
|
|||||||||||||||
|
|
|
|
|
|
|
|
||||||||
|
Unrealized
|
|
Defined Benefit Plan Items
|
|
|
||||||||||
|
Gains and
|
|
|
|
|
|
|
||||||||
|
Losses on
|
|
|
|
Net Prior
|
|
|
||||||||
|
Available-for-
|
|
Net Gain
|
|
Service
|
|
|
||||||||
|
Sale Securities
|
|
(Loss)
|
|
(Cost ) Credit
|
|
Total
|
||||||||
For the Year-To-Date periods ended:
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
December 31, 2012
|
$
|
5,625
|
|
|
$
|
(14,036
|
)
|
|
$
|
(51
|
)
|
|
$
|
(8,462
|
)
|
Other comprehensive income (loss) before reclassifications
|
(2,925
|
)
|
|
6,425
|
|
|
—
|
|
|
3,500
|
|
||||
Amounts reclassified from accumulated other comprehensive income (loss)
|
(326
|
)
|
|
914
|
|
|
1
|
|
|
589
|
|
||||
Net current-period other comprehensive income
|
(3,251
|
)
|
|
7,339
|
|
|
1
|
|
|
4,089
|
|
||||
December 31, 2013
|
$
|
2,374
|
|
|
$
|
(6,697
|
)
|
|
$
|
(50
|
)
|
|
$
|
(4,373
|
)
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2011
|
$
|
6,808
|
|
|
$
|
(13,709
|
)
|
|
$
|
206
|
|
|
$
|
(6,695
|
)
|
Other comprehensive income (loss) before reclassifications
|
(661
|
)
|
|
(1,340
|
)
|
|
(245
|
)
|
|
(2,246
|
)
|
||||
Amounts reclassified from accumulated other comprehensive income (loss)
|
(522
|
)
|
|
1,013
|
|
|
(12
|
)
|
|
479
|
|
||||
Net current-period other comprehensive income
|
(1,183
|
)
|
|
(327
|
)
|
|
(257
|
)
|
|
(1,767
|
)
|
||||
December 31, 2012
|
$
|
5,625
|
|
|
$
|
(14,036
|
)
|
|
$
|
(51
|
)
|
|
$
|
(8,462
|
)
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2010
|
$
|
3,755
|
|
|
$
|
(10,610
|
)
|
|
$
|
432
|
|
|
$
|
(6,423
|
)
|
Other comprehensive income (loss) before reclassifications
|
4,741
|
|
|
(3,701
|
)
|
|
(161
|
)
|
|
879
|
|
||||
Amounts reclassified from accumulated other comprehensive income (loss)
|
(1,688
|
)
|
|
602
|
|
|
(65
|
)
|
|
(1,151
|
)
|
||||
Net current-period other comprehensive income
|
3,053
|
|
|
(3,099
|
)
|
|
(226
|
)
|
|
(272
|
)
|
||||
December 31, 2011
|
$
|
6,808
|
|
|
$
|
(13,709
|
)
|
|
$
|
206
|
|
|
$
|
(6,695
|
)
|
|
|
|
|
|
|
|
|
Reclassifications Out of Accumulated Other Comprehensive Income
(1)
|
||||||
|
||||||
|
|
Amounts Reclassified
|
|
|
||
Details about Accumulated Other
|
|
from Accumulated Other
|
|
Affected Line Item in the Statement
|
||
Comprehensive Income Components
|
|
Comprehensive Income
|
|
Where Net Income Is Presented
|
||
|
|
|
|
|
||
December 31, 2011
|
|
|
|
|
||
|
|
|
|
|
||
Unrealized gains and losses on available-for-sale securities
|
|
|
|
|
||
|
|
$
|
2,795
|
|
|
Gain on Securities Transactions, Net
|
|
|
2,795
|
|
|
Total before tax
|
|
|
|
(1,107
|
)
|
|
Provision for Income Taxes
|
|
|
|
$
|
1,688
|
|
|
Net of tax
|
|
|
|
|
|
||
Amortization of defined benefit pension items
|
|
|
|
|
||
Prior-service costs
|
|
108
|
|
(2)
|
Salaries and Employee Benefits
|
|
Actuarial gains/(losses)
|
|
$
|
(996
|
)
|
(2)
|
Salaries and Employee Benefits
|
|
|
(888
|
)
|
|
Total before tax
|
|
|
|
351
|
|
|
Provision for Income Taxes
|
|
|
|
$
|
(537
|
)
|
|
Net of tax
|
|
|
|
|
|
||
Total reclassifications for the period
|
|
$
|
1,151
|
|
|
Net of tax
|
|
|
|
|
|
Note 12:
|
STOCK BASED COMPENSATION (Dollars In Thousands, Except Share and Per Share Amounts)
|
|
Stock Option Plans
|
||
Roll Forward of Shares Outstanding:
|
|
||
Outstanding at January 1, 2013
|
451,210
|
|
|
Granted
|
10,200
|
|
|
Exercised
|
(59,612
|
)
|
|
Forfeited
|
(12,406
|
)
|
|
Outstanding at December 31, 2013
|
389,392
|
|
|
Exercisable at December 31, 2013
|
269,758
|
|
|
Vested and Expected to Vest
|
119,634
|
|
|
|
|
||
Roll Forward of Shares Outstanding - Weighted Average Exercise Price:
|
|
||
Outstanding at January 1, 2013
|
$
|
22.67
|
|
Granted
|
23.80
|
|
|
Exercised
|
21.02
|
|
|
Forfeited
|
24.71
|
|
|
Outstanding at December 31, 2013
|
22.89
|
|
|
Exercisable at December 31, 2013
|
22.29
|
|
|
Vested and Expected to Vest
|
24.25
|
|
|
|
|
||
Weighted Average Remaining Contractual Life (in years):
|
|
||
Outstanding at December 31, 2013
|
5.57
|
|
|
Exercisable at December 31, 2013
|
4.68
|
|
|
Vested and Expected to Vest
|
7.58
|
|
|
|
|
||
Aggregate Intrinsic Value:
|
|
||
Outstanding at December 31, 2013
|
$
|
1,429
|
|
Exercisable at December 31, 2013
|
1,152
|
|
|
Vested and Expected to Vest
|
277
|
|
|
|
|
||
Shares Available for Grant at Period-End
|
459,000
|
|
|
Exercise Price Ranges
|
|||||||||||||||||
|
$19.08 to $19.87
|
$21.24 to $22.27
|
$23.76 to $23.80
|
$24.43
|
$25.77
|
Total
|
||||||||||||
Outstanding Options at
December 31, 2013
|
|
|
|
|
|
|
||||||||||||
Number of Shares Outstanding
|
85,278
|
|
98,376
|
|
83,015
|
|
75,512
|
|
47,211
|
|
389,392
|
|
||||||
Weighted-Average Remaining Contractual Life (in years)
|
4.73
|
|
5.11
|
|
7.34
|
|
8.05
|
|
0.97
|
|
5.57
|
|
||||||
Weighted-Average Exercise Price
|
$
|
19.64
|
|
$
|
21.95
|
|
$
|
23.77
|
|
$
|
24.43
|
|
$
|
25.77
|
|
$
|
22.89
|
|
|
|
|
|
|
|
|
||||||||||||
Exercisable Options at
December 31, 2013
|
|
|
|
|
|
|
||||||||||||
Number of Shares Outstanding
|
85,278
|
|
81,150
|
|
36,391
|
|
19,728
|
|
47,211
|
|
269,758
|
|
||||||
Weighted-Average Remaining Contractual Life (in years)
|
4.73
|
|
4.90
|
|
7.09
|
|
7.94
|
|
0.97
|
|
4.68
|
|
||||||
Weighted-Average Exercise Price
|
$
|
19.64
|
|
$
|
21.88
|
|
$
|
23.77
|
|
$
|
24.42
|
|
$
|
25.77
|
|
$
|
22.29
|
|
|
|
|
|
|
|
|
|
|
2013
|
|
2012
|
|
2011
|
||||||
Shares Granted
|
|
10,200
|
|
|
77,302
|
|
|
79,994
|
|
|||
Weighted Average Grant Date Information:
|
|
|
|
|
|
|
||||||
Fair Value of Options Granted
|
|
$
|
5.46
|
|
|
$
|
5.89
|
|
|
$
|
6.00
|
|
Fair Value Assumptions:
|
|
|
|
|
|
|
||||||
Dividend Yield
|
|
4.20
|
%
|
|
3.93
|
%
|
|
4.00
|
%
|
|||
Expected Volatility
|
|
36.57
|
%
|
|
37.43
|
%
|
|
36.50
|
%
|
|||
Risk Free Interest Rate
|
|
1.31
|
%
|
|
1.22
|
%
|
|
2.54
|
%
|
|||
Expected Lives (in years)
|
|
6.71
|
|
|
6.46
|
|
|
6.40
|
|
|||
|
|
|
|
|
|
|
||||||
Amount Expensed During the Year
|
|
$
|
372
|
|
|
$
|
424
|
|
|
$
|
354
|
|
Compensation Costs for Non-vested Awards Not Yet Recognized
|
|
420
|
|
|
737
|
|
|
705
|
|
|||
Weighted Average Expected Vesting Period, In Years
|
|
1.45
|
|
|
1.71
|
|
|
1.80
|
|
|||
Proceeds From Stock Options Exercised
|
|
$
|
1,254
|
|
|
$
|
2,105
|
|
|
$
|
1,413
|
|
Tax Benefits Related to Stock Options Exercised
|
|
23
|
|
|
68
|
|
|
51
|
|
|||
Intrinsic Value of Stock Options Exercised
|
|
267
|
|
|
2,434
|
|
|
1,740
|
|
|
|
2013
|
|
2012
|
|
2011
|
||||||
ESOP Compensation Expense
|
|
$
|
600
|
|
|
$
|
550
|
|
|
$
|
550
|
|
ESOP Plan Shares:
|
2013
|
||
Allocated Shares
|
644,248
|
|
|
Shares Released for Allocation During 2013
|
16,969
|
|
|
Unallocated Shares
|
87,641
|
|
|
Total ESOP Shares
|
748,858
|
|
|
|
|
||
Market Value of Unallocated Shares
|
$
|
2,328
|
|
Note 13:
|
RETIREMENT BENEFIT PLANS (Dollars in Thousands)
|
Schedule of Defined Benefit Plan Disclosures
|
|||||||||||
|
Employees'
Pension
Plan
|
|
Select
Executive
Retirement
Plan
|
|
Postretirement
Benefit
Plans
|
||||||
Defined Benefit Plan Funded Status
|
|
|
|
|
|
||||||
December 31, 2013
|
|
|
|
|
|
||||||
Fair Value of Plan Assets
|
$
|
44,653
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Benefit Obligation
|
33,259
|
|
|
4,459
|
|
|
7,619
|
|
|||
Funded Status of Plan
|
$
|
11,394
|
|
|
$
|
(4,459
|
)
|
|
$
|
(7,619
|
)
|
|
|
|
|
|
|
||||||
December 31, 2012
|
|
|
|
|
|
||||||
Fair Value of Plan Assets
|
$
|
39,880
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Benefit Obligation
|
37,046
|
|
|
5,324
|
|
|
9,213
|
|
|||
Funded Status of Plan
|
$
|
2,834
|
|
|
$
|
(5,324
|
)
|
|
$
|
(9,213
|
)
|
|
|
|
|
|
|
||||||
Change in Benefit Obligation
|
|
|
|
|
|
||||||
Benefit Obligation, at January 1, 2013
|
$
|
37,046
|
|
|
$
|
5,324
|
|
|
$
|
9,213
|
|
Service Cost
|
1,506
|
|
|
—
|
|
|
211
|
|
|||
Interest Cost
|
1,261
|
|
|
163
|
|
|
308
|
|
|||
Plan Participants' Contributions
|
—
|
|
|
—
|
|
|
368
|
|
|||
Amendments
|
—
|
|
|
—
|
|
|
—
|
|
|||
Actuarial Gain
|
(3,820
|
)
|
|
(555
|
)
|
|
(1,648
|
)
|
|||
Benefits Paid
|
(2,734
|
)
|
|
(473
|
)
|
|
(833
|
)
|
|||
Benefit Obligation, at December 31, 2013
|
$
|
33,259
|
|
|
$
|
4,459
|
|
|
$
|
7,619
|
|
|
|
|
|
|
|
Schedule of Defined Benefit Plan Disclosures
|
|||||||||||
|
Employees'
Pension
Plan
|
|
Select
Executive
Retirement
Plan
|
|
Postretirement
Benefit
Plans
|
||||||
Benefit Obligation, at January 1, 2012
|
$
|
35,047
|
|
|
$
|
4,529
|
|
|
$
|
8,556
|
|
Service Cost
|
1,467
|
|
|
87
|
|
|
202
|
|
|||
Interest Cost
|
1,436
|
|
|
190
|
|
|
338
|
|
|||
Plan Participants' Contributions
|
—
|
|
|
—
|
|
|
348
|
|
|||
Amendments
|
—
|
|
|
405
|
|
|
—
|
|
|||
Actuarial Loss
|
2,857
|
|
|
441
|
|
|
491
|
|
|||
Benefits Paid
|
(3,761
|
)
|
|
(328
|
)
|
|
(722
|
)
|
|||
Benefit Obligation, at December 31, 2012
|
$
|
37,046
|
|
|
$
|
5,324
|
|
|
$
|
9,213
|
|
|
|
|
|
|
|
||||||
Change in Fair Value of Plan Assets
|
|
|
|
|
|
||||||
Fair Value of Plan Assets, at January 1, 2013
|
$
|
39,880
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Actual Return on Plan Assets
|
7,507
|
|
|
—
|
|
|
—
|
|
|||
Employer Contributions
|
—
|
|
|
473
|
|
|
465
|
|
|||
Plan Participants' Contributions
|
—
|
|
|
—
|
|
|
368
|
|
|||
Benefits Paid
|
(2,734
|
)
|
|
(473
|
)
|
|
(833
|
)
|
|||
Fair Value of Plan Assets, at December 31, 2013
|
$
|
44,653
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
||||||
Change in Fair Value of Plan Assets, continued
|
|
|
|
|
|
||||||
Fair Value of Plan Assets, at January 1, 2012
|
$
|
39,206
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Actual Return on Plan Assets
|
4,435
|
|
|
—
|
|
|
—
|
|
|||
Employer Contributions
|
—
|
|
|
328
|
|
|
374
|
|
|||
Plan Participants' Contributions
|
—
|
|
|
—
|
|
|
348
|
|
|||
Benefits Paid
|
(3,761
|
)
|
|
(328
|
)
|
|
(722
|
)
|
|||
Fair Value of Plan Assets, at December 31, 2012
|
$
|
39,880
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
||||||
Accumulated Benefit Obligation at December 31, 2013
|
$
|
32,886
|
|
|
$
|
4,459
|
|
|
$
|
7,619
|
|
|
|
|
|
|
|
||||||
Amounts Recognized in the Consolidated Balance Sheets
|
|
|
|
|
|
||||||
December 31, 2013
|
|
|
|
|
|
||||||
Prepaid Pension Asset
|
$
|
11,394
|
|
|
$
|
—
|
|
|
—
|
|
|
Accrued Benefit Liability
|
—
|
|
|
(4,459
|
)
|
|
(7,619
|
)
|
|||
Net Benefit Recognized
|
$
|
11,394
|
|
|
$
|
(4,459
|
)
|
|
$
|
(7,619
|
)
|
|
|
|
|
|
|
||||||
December 31, 2012
|
|
|
|
|
|
||||||
Prepaid Pension Asset
|
$
|
2,834
|
|
|
$
|
—
|
|
|
—
|
|
|
Accrued Benefit Liability
|
—
|
|
|
(5,324
|
)
|
|
(9,213
|
)
|
|||
Net Benefit Recognized
|
$
|
2,834
|
|
|
$
|
(5,324
|
)
|
|
$
|
(9,213
|
)
|
|
|
|
|
|
|
||||||
Amounts Recognized in Other Comprehensive Income (Loss)
|
|
|
|
|
|
||||||
For the Year Ended December 31, 2013
|
|
|
|
|
|
||||||
Net Unamortized Gain Arising During the Period
|
$
|
(8,438
|
)
|
|
$
|
(554
|
)
|
|
$
|
(1,648
|
)
|
Net Prior Service Cost Arising During the Period
|
—
|
|
|
—
|
|
|
—
|
|
|||
Amortization of Net Loss
|
(1,231
|
)
|
|
(140
|
)
|
|
(142
|
)
|
|||
Amortization of Prior Service (Cost) Credit
|
(37
|
)
|
|
(79
|
)
|
|
114
|
|
|||
Total Other Comprehensive (Loss) Income for Pension and
Other Postretirement Benefit Plans
|
$
|
(9,706
|
)
|
|
$
|
(773
|
)
|
|
$
|
(1,676
|
)
|
|
|
|
|
|
|
||||||
For the Year Ended December 31, 2012
|
|
|
|
|
|
||||||
Net Unamortized Loss Arising During the Period
|
$
|
1,286
|
|
|
$
|
441
|
|
|
$
|
491
|
|
Net Prior Service Cost Arising During the Period
|
—
|
|
|
405
|
|
|
—
|
|
|||
Amortization of Net Loss
|
(1,387
|
)
|
|
(156
|
)
|
|
(134
|
)
|
|||
Amortization of Prior Service (Cost) Credit
|
(41
|
)
|
|
(53
|
)
|
|
114
|
|
|||
Total Other Comprehensive (Loss) Income for Pension and
Other Postretirement Benefit Plans
|
$
|
(142
|
)
|
|
$
|
637
|
|
|
$
|
471
|
|
|
|
|
|
|
|
Schedule of Defined Benefit Plan Disclosures
|
|||||||||||
|
Employees'
Pension
Plan
|
|
Select
Executive
Retirement
Plan
|
|
Postretirement
Benefit
Plans
|
||||||
For the Year Ended December 31, 2011
|
|
|
|
|
|
||||||
Net Unamortized Loss Arising During the Period
|
$
|
5,474
|
|
|
$
|
151
|
|
|
$
|
504
|
|
Net Prior Service Cost Arising During the Period
|
191
|
|
|
75
|
|
|
—
|
|
|||
Amortization of Net Loss
|
(778
|
)
|
|
(147
|
)
|
|
(71
|
)
|
|||
Amortization of Prior Service (Cost) Credit
|
(38
|
)
|
|
32
|
|
|
114
|
|
|||
Total Other Comprehensive (Loss) Income for Pension and
Other Postretirement Benefit Plans
|
$
|
4,849
|
|
|
$
|
111
|
|
|
$
|
547
|
|
|
|
|
|
|
|
||||||
Accumulated Other Comprehensive Income
|
|
|
|
|
|
||||||
December 31, 2013
|
|
|
|
|
|
||||||
Net Actuarial Loss
|
$
|
8,357
|
|
|
$
|
1,674
|
|
|
$
|
1,060
|
|
Prior Service (Credit) Cost
|
(255
|
)
|
|
642
|
|
|
(305
|
)
|
|||
Total Accumulated Other Comprehensive Income, Before Tax
|
$
|
8,102
|
|
|
$
|
2,316
|
|
|
$
|
755
|
|
|
|
|
|
|
|
||||||
December 31, 2012
|
|
|
|
|
|
||||||
Net Actuarial Loss
|
$
|
18,026
|
|
|
$
|
2,368
|
|
|
$
|
2,850
|
|
Prior Service (Credit) Cost
|
(218
|
)
|
|
721
|
|
|
(419
|
)
|
|||
Total Accumulated Other Comprehensive Income, Before Tax
|
$
|
17,808
|
|
|
$
|
3,089
|
|
|
$
|
2,431
|
|
Amounts that will be Amortized from Accumulated
Other Comprehensive Income the Next Year
|
|
|
|
|
|
||||||
Net Actuarial Loss
|
$
|
345
|
|
|
$
|
90
|
|
|
$
|
26
|
|
Prior Service (Credit) Cost
|
$
|
(45
|
)
|
|
$
|
72
|
|
|
$
|
(114
|
)
|
|
|
|
|
|
|
||||||
Net Periodic Benefit Cost
|
|
|
|
|
|
||||||
For the Year Ended December 31, 2013
|
|
|
|
|
|
||||||
Service Cost
|
$
|
1,506
|
|
|
$
|
—
|
|
|
$
|
211
|
|
Interest Cost
|
1,261
|
|
|
163
|
|
|
308
|
|
|||
Expected Return on Plan Assets
|
(2,889
|
)
|
|
—
|
|
|
—
|
|
|||
Amortization of Prior Service (Credit) Cost
|
37
|
|
|
79
|
|
|
(114
|
)
|
|||
Amortization of Net Loss
|
1,232
|
|
|
139
|
|
|
142
|
|
|||
Net Periodic Benefit Cost
|
$
|
1,147
|
|
|
$
|
381
|
|
|
$
|
547
|
|
|
|
|
|
|
|
||||||
For the Year Ended December 31, 2012
|
|
|
|
|
|
||||||
Service Cost
|
$
|
1,467
|
|
|
$
|
87
|
|
|
$
|
202
|
|
Interest Cost
|
1,436
|
|
|
190
|
|
|
338
|
|
|||
Expected Return on Plan Assets
|
(2,865
|
)
|
|
—
|
|
|
—
|
|
|||
Amortization of Prior Service (Credit) Cost
|
41
|
|
|
53
|
|
|
(114
|
)
|
|||
Amortization of Net Loss
|
1,387
|
|
|
156
|
|
|
134
|
|
|||
Net Periodic Benefit Cost
|
$
|
1,466
|
|
|
$
|
486
|
|
|
$
|
560
|
|
|
|
|
|
|
|
||||||
For the Year Ended December 31, 2011
|
|
|
|
|
|
||||||
Service Cost
|
$
|
1,353
|
|
|
$
|
81
|
|
|
$
|
173
|
|
Interest Cost
|
1,598
|
|
|
222
|
|
|
372
|
|
|||
Expected Return on Plan Assets
|
(2,793
|
)
|
|
—
|
|
|
—
|
|
|||
Amortization of Prior Service (Credit) Cost
|
38
|
|
|
(32
|
)
|
|
(114
|
)
|
|||
Amortization of Net Loss
|
778
|
|
|
147
|
|
|
71
|
|
|||
Net Periodic Benefit Cost
|
$
|
974
|
|
|
$
|
418
|
|
|
$
|
502
|
|
|
|
|
|
|
|
||||||
Weighted-Average Assumptions Used in
Calculating Benefit Obligation
|
|
|
|
|
|
||||||
December 31, 2013
|
|
|
|
|
|
||||||
Discount Rate
|
5.10
|
%
|
|
4.85
|
%
|
|
5.10
|
%
|
|||
Rate of Compensation Increase
|
3.50
|
%
|
|
3.50
|
%
|
|
3.50
|
%
|
Schedule of Defined Benefit Plan Disclosures
|
|||||||||||
|
Employees'
Pension
Plan
|
|
Select
Executive
Retirement
Plan
|
|
Postretirement
Benefit
Plans
|
||||||
Interest Rate Credit for Determining
Projected Cash Balance Account
|
4.00
|
%
|
|
|
|
|
|
||||
Interest Rate to Annuitize Cash
Balance Account
|
5.25
|
%
|
|
|
|
|
|
||||
Interest Rate to Convert Annuities To Actuarially
Equivalent Lump Sum Amounts
|
5.25
|
%
|
|
5.25
|
%
|
|
|
||||
|
|
|
|
|
|
||||||
December 31, 2012
|
|
|
|
|
|
||||||
Discount Rate
|
3.55
|
%
|
|
3.15
|
%
|
|
3.55
|
%
|
|||
Rate of Compensation Increase
|
3.50
|
%
|
|
3.50
|
%
|
|
3.50
|
%
|
|||
Interest Rate Credit for Determining
Projected Cash Balance Account
|
3.00
|
%
|
|
|
|
|
|
||||
Interest Rate to Annuitize Cash
Balance Account
|
4.50
|
%
|
|
|
|
|
|
||||
Interest Rate to Convert Annuities To Actuarially
Equivalent Lump Sum Amounts
|
4.50
|
%
|
|
4.50
|
%
|
|
|
||||
|
|
|
|
|
|
||||||
Weighted-Average Assumptions Used in
Calculating Net Periodic Benefit Cost
|
|
|
|
|
|
||||||
December 31, 2013
|
|
|
|
|
|
||||||
Discount Rate
|
3.55
|
%
|
|
3.15
|
%
|
|
3.55
|
%
|
|||
Expected Long-Term Return on Plan Assets
|
7.50
|
%
|
|
|
|
|
|
||||
Rate of Compensation Increase
|
3.50
|
%
|
|
3.50
|
%
|
|
3.50
|
%
|
|||
Interest Rate Credit for Determining
Projected Cash Balance Account
|
3.00
|
%
|
|
|
|
|
|
||||
Interest Rate to Annuitize Cash
Balance Account
|
4.50
|
%
|
|
|
|
|
|
||||
Interest Rate to Convert AnnuitiesTo Actuarially
Equivalent Lump Sum Amounts
|
4.50
|
%
|
|
4.50
|
%
|
|
|
||||
|
|
|
|
|
|
||||||
December 31, 2012
|
|
|
|
|
|
||||||
Discount Rate
|
4.05
|
%
|
|
4.05
|
%
|
|
4.05
|
%
|
|||
Expected Long-Term Return on Plan Assets
|
7.50
|
%
|
|
|
|
|
|
||||
Rate of Compensation Increase
|
3.50
|
%
|
|
3.50
|
%
|
|
3.50
|
%
|
|||
Interest Rate Credit for Determining
Projected Cash Balance Account
|
3.25
|
%
|
|
|
|
|
|
||||
Interest Rate to Annuitize Cash
Balance Account
|
5.00
|
%
|
|
|
|
|
|
||||
Interest Rate to Convert AnnuitiesTo Actuarially
Equivalent Lump Sum Amounts
|
5.00
|
%
|
|
5.00
|
%
|
|
|
||||
|
|
|
|
|
|
||||||
December 31, 2011
|
|
|
|
|
|
||||||
Discount Rate
|
5.15
|
%
|
|
5.15
|
%
|
|
5.15
|
%
|
|||
Expected Long-Term Return on Plan Assets
|
7.50
|
%
|
|
|
|
|
|
||||
Rate of Compensation Increase
|
3.50
|
%
|
|
3.50
|
%
|
|
3.50
|
%
|
|||
Interest Rate Credit for Determining
Projected Cash Balance Account
|
4.25
|
%
|
|
|
|
|
|
||||
Interest Rate to Annuitize Cash
Balance Account
|
5.50
|
%
|
|
|
|
|
|
||||
Interest Rate to Convert AnnuitiesTo Actuarially
Equivalent Lump Sum Amounts
|
5.50
|
%
|
|
5.50
|
%
|
|
|
Schedule of Defined Benefit Plan Disclosures
Information about Defined Benefit Plan Assets - Employees' Pension Plan
|
||||||||||||||||||||||||
|
Fair Value Measurements Using:
|
|
|
|
|
|
|
|||||||||||||||||
Asset Category
|
Quoted Prices
in Active Markets
for Identical Assets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
|
Total
|
|
Percent of Total
|
|
Target Allocation Minimum
|
|
Target Allocation Maximum
|
|||||||||||
December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Cash
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7
|
|
|
—
|
%
|
|
—
|
%
|
|
15.0
|
%
|
Interest-Bearing Money Market Fund
|
3,941
|
|
|
—
|
|
|
—
|
|
|
3,941
|
|
|
8.8
|
%
|
|
—
|
%
|
|
15.0
|
%
|
||||
Arrow Common Stock
1
|
4,291
|
|
|
—
|
|
|
—
|
|
|
4,291
|
|
|
9.6
|
%
|
|
—
|
%
|
|
10.0
|
%
|
||||
North Country Funds - Equity
2
|
17,419
|
|
|
—
|
|
|
—
|
|
|
17,419
|
|
|
39.1
|
%
|
|
|
|
|
|
|
||||
Other Mutual Funds - Equity
|
14,338
|
|
|
—
|
|
|
—
|
|
|
14,338
|
|
|
32.1
|
%
|
|
|
|
|
|
|
||||
Total Equity Funds
|
31,757
|
|
|
—
|
|
|
—
|
|
|
31,757
|
|
|
71.2
|
%
|
|
55.0
|
%
|
|
85.0
|
%
|
||||
North Country Funds - Fixed income
2
|
4,309
|
|
|
—
|
|
|
—
|
|
|
4,309
|
|
|
9.6
|
%
|
|
|
|
|
|
|
||||
Other Mutual Funds - Fixed Income
|
348
|
|
|
—
|
|
|
—
|
|
|
348
|
|
|
0.8
|
%
|
|
|
|
|
|
|
||||
Total Fixed Income Funds
|
4,657
|
|
|
—
|
|
|
—
|
|
|
4,657
|
|
|
10.4
|
%
|
|
10.0
|
%
|
|
30.0
|
%
|
||||
Total
|
$
|
44,653
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
44,653
|
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Cash
|
$
|
17
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
17
|
|
|
—
|
%
|
|
—
|
%
|
|
15.0
|
%
|
Interest-Bearing Money Market Fund
|
5,236
|
|
|
—
|
|
|
—
|
|
|
5,236
|
|
|
13.1
|
%
|
|
—
|
%
|
|
15.0
|
%
|
||||
Arrow Common Stock
|
4,197
|
|
|
—
|
|
|
—
|
|
|
4,197
|
|
|
10.5
|
%
|
|
—
|
%
|
|
10.0
|
%
|
||||
North Country Funds - Equity
2
|
13,043
|
|
|
—
|
|
|
—
|
|
|
13,043
|
|
|
32.8
|
%
|
|
|
|
|
|
|||||
Other Mutual Funds - Equity
|
11,160
|
|
|
—
|
|
|
—
|
|
|
11,160
|
|
|
28.0
|
%
|
|
|
|
|
|
|||||
Total Equity Funds
|
24,203
|
|
|
—
|
|
|
—
|
|
|
24,203
|
|
|
60.8
|
%
|
|
55.0
|
%
|
|
85.0
|
%
|
||||
North Country Funds - Fixed income
2
|
4,236
|
|
|
—
|
|
|
—
|
|
|
4,236
|
|
|
10.6
|
%
|
|
|
|
|
|
|||||
Other Mutual Funds - Fixed Income
|
1,991
|
|
|
—
|
|
|
—
|
|
|
1,991
|
|
|
5.0
|
%
|
|
|
|
|
|
|||||
Total Fixed Income Funds
|
6,227
|
|
|
—
|
|
|
—
|
|
|
6,227
|
|
|
15.6
|
%
|
|
10.0
|
%
|
|
30.0
|
%
|
||||
Total
|
$
|
39,880
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
39,880
|
|
|
100.0
|
%
|
|
|
|
|
Schedule of Defined Benefit Plan Disclosures
|
|||||||||||
|
Employees'
Pension
Plan
|
|
Select
Executive
Retirement
Plan
|
|
Postretirement
Benefit
Plans
|
||||||
Expected Future Benefit Payments
|
|
|
|
|
|
||||||
2014
|
$
|
3,068
|
|
|
$
|
452
|
|
|
$
|
510
|
|
2015
|
2,047
|
|
|
440
|
|
|
531
|
|
|||
2016
|
2,344
|
|
|
416
|
|
|
539
|
|
|||
2017
|
2,252
|
|
|
402
|
|
|
549
|
|
|||
2018
|
2,165
|
|
|
388
|
|
|
562
|
|
|||
2019-2023
|
12,516
|
|
|
1,699
|
|
|
3,026
|
|
|||
|
|
|
|
|
|
|
|||||
Estimated Contributions During 2014
|
$
|
—
|
|
|
$
|
452
|
|
|
$
|
510
|
|
|
|
|
|
|
|
||||||
Assumed Health Care Cost Trend Rates
|
|
|
|
|
|
||||||
December 31, 2013
|
|
|
|
|
|
||||||
Health Care Cost Trend
Rate Assumed for Next Year
|
|
|
|
|
8.50
|
%
|
|||||
Rate to which the Cost Trend
Rate is Assumed to Decline
(the Ultimate Trend Rate)
|
|
|
|
|
5.00
|
%
|
|||||
Year that the Rate Reaches
the Ultimate Trend Rate
|
|
|
|
|
2021
|
|
|||||
|
|
|
|
|
|
||||||
December 31, 2012
|
|
|
|
|
|
||||||
Health Care Cost Trend
Rate Assumed for Next Year
|
|
|
|
|
9.00
|
%
|
|||||
Rate to which the Cost Trend
Rate is Assumed to Decline
(the Ultimate Trend Rate)
|
|
|
|
|
5.00
|
%
|
|||||
Year that the Rate Reaches
the Ultimate Trend Rate
|
|
|
|
|
2021
|
|
|||||
|
|
|
|
|
|
||||||
Effect of a One-Percentage Point Change in Assumed
Health Care Cost Trend Rates
|
|
|
|
|
|
||||||
Effect of a One Percentage Point Increase on
Service and Interest Cost Components
|
|
|
|
|
$
|
59
|
|
||||
Effect of a One Percentage Point Decrease on
Service and Interest Cost Components
|
|
|
|
|
(49
|
)
|
|||||
Effect of a One Percentage Point Increase on
Accumulated Postretirement Benefit Obligation
|
|
|
|
|
557
|
|
|||||
Effect of a One Percentage Point Decrease on
Accumulated Postretirement Benefit Obligation
|
|
|
|
|
(478
|
)
|
Note 14:
|
OTHER EXPENSES (Dollars In Thousands)
|
|
2013
|
|
2012
|
|
2011
|
||||||
Computer Services
|
$
|
3,261
|
|
|
$
|
2,263
|
|
|
$
|
1,654
|
|
Legal and Other Professional Fees
|
1,823
|
|
|
1,962
|
|
|
1,972
|
|
|||
Postage and Courier
|
1,046
|
|
|
1,040
|
|
|
1,088
|
|
|||
Stationery and Printing
|
905
|
|
|
975
|
|
|
891
|
|
|||
Advertising and Promotion
|
879
|
|
|
831
|
|
|
853
|
|
|||
Telephone and Communications
|
804
|
|
|
808
|
|
|
981
|
|
|||
Intangible Asset Amortization
|
452
|
|
|
518
|
|
|
510
|
|
|||
All Other
|
3,486
|
|
|
3,243
|
|
|
3,095
|
|
|||
Total Other Operating Expense
|
$
|
12,656
|
|
|
$
|
11,640
|
|
|
$
|
11,044
|
|
Note 15:
|
INCOME TAXES (Dollars In Thousands)
|
Current Tax Expense:
|
2013
|
|
2012
|
|
2011
|
||||||
Federal
|
$
|
7,933
|
|
|
$
|
8,763
|
|
|
$
|
6,726
|
|
State
|
852
|
|
|
1,251
|
|
|
816
|
|
|||
Total Current Tax Expense
|
8,785
|
|
|
10,014
|
|
|
7,542
|
|
|||
Deferred Tax Expense (Benefit):
|
|
|
|
|
|
||||||
Federal
|
172
|
|
|
(290
|
)
|
|
1,775
|
|
|||
State
|
122
|
|
|
(63
|
)
|
|
397
|
|
|||
Total Deferred Tax Expense (Benefit)
|
294
|
|
|
(353
|
)
|
|
2,172
|
|
|||
Total Provision for Income Taxes
|
$
|
9,079
|
|
|
$
|
9,661
|
|
|
$
|
9,714
|
|
|
2013
|
|
2012
|
|
2011
|
||||||
Computed Tax Expense at Statutory Rate
|
$
|
10,806
|
|
|
$
|
11,144
|
|
|
$
|
11,076
|
|
Increase (Decrease) in Income Taxes Resulting From:
|
|
|
|
|
|
||||||
Tax-Exempt Income
|
(2,238
|
)
|
|
(2,132
|
)
|
|
(2,199
|
)
|
|||
Nondeductible Interest Expense
|
80
|
|
|
95
|
|
|
152
|
|
|||
State Taxes, Net of Federal Income Tax Benefit
|
633
|
|
|
814
|
|
|
788
|
|
|||
Other Items, Net
|
(202
|
)
|
|
(260
|
)
|
|
(103
|
)
|
|||
Total Provision for Income Taxes
|
$
|
9,079
|
|
|
$
|
9,661
|
|
|
$
|
9,714
|
|
|
2013
|
|
2012
|
||||
Deferred Tax Assets:
|
|
|
|
||||
Allowance for Loan Losses
|
$
|
5,794
|
|
|
$
|
6,105
|
|
Pension and Deferred Compensation Plans
|
3,999
|
|
|
4,140
|
|
||
Pension Liability Included in Accumulated Other Comprehensive Income
|
4,426
|
|
|
9,241
|
|
||
Other
|
566
|
|
|
608
|
|
||
Total Gross Deferred Tax Assets
|
14,785
|
|
|
20,094
|
|
||
Valuation Allowance for Deferred Tax Assets
|
—
|
|
|
—
|
|
||
Total Gross Deferred Tax Assets, Net of Valuation Allowance
|
$
|
14,785
|
|
|
$
|
20,094
|
|
Deferred Tax Liabilities:
|
|
|
|
||||
Pension Plans
|
$
|
7,724
|
|
|
$
|
8,178
|
|
Depreciation
|
1,561
|
|
|
1,475
|
|
||
Deferred Income
|
3,526
|
|
|
3,189
|
|
||
Net Unrealized Gains on Securities Available-for-Sale Included in
Accumulated Other Comprehensive Income
|
1,557
|
|
|
3,690
|
|
||
Goodwill
|
5,230
|
|
|
5,225
|
|
||
Total Gross Deferred Tax Liabilities
|
$
|
19,598
|
|
|
$
|
21,757
|
|
Note 16:
|
EARNINGS PER SHARE (In Thousands, Except Per Share Amounts)
|
Earnings Per Share
|
|||||||||||
|
Year-to-Date Period Ended:
|
||||||||||
|
12/31/2013
|
|
12/31/2012
|
|
12/31/2011
|
||||||
Earnings Per Share - Basic:
|
|
|
|
|
|
||||||
Net Income
|
$
|
21,795
|
|
|
$
|
22,179
|
|
|
$
|
21,933
|
|
Weighted Average Shares - Basic
|
12,296
|
|
|
12,247
|
|
|
12,209
|
|
|||
Earnings Per Share - Basic
|
$
|
1.77
|
|
|
$
|
1.81
|
|
|
$
|
1.80
|
|
|
|
|
|
|
|
||||||
Earnings Per Share - Diluted:
|
|
|
|
|
|
|
|
||||
Net Income
|
$
|
21,795
|
|
|
$
|
22,179
|
|
|
$
|
21,933
|
|
Weighted Average Shares - Basic
|
12,296
|
|
|
12,247
|
|
|
12,209
|
|
|||
Dilutive Average Shares Attributable to Stock Options
|
31
|
|
|
10
|
|
|
12
|
|
|||
Weighted Average Shares - Diluted
|
12,327
|
|
|
12,257
|
|
|
12,221
|
|
|||
Earnings Per Share - Diluted
|
$
|
1.77
|
|
|
$
|
1.81
|
|
|
$
|
1.79
|
|
Antidilutive Shares Excluded from the Calculation
of Earnings Per Share
|
47
|
|
|
203
|
|
|
136
|
|
Note 17:
|
FAIR VALUES (Dollars In Thousands)
|
Fair Value of Assets and Liabilities Measured on a Recurring and Nonrecurring Basis
|
|
|
|||||||||||||||||
|
Fair Value Measurements at Reporting Date Using:
|
||||||||||||||||||
Fair Value of Assets and Liabilities Measured on a Recurring Basis:
|
Fair Value
|
|
Quoted Prices
In Active Markets for Identical Assets
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
|
Total Gains (Losses)
|
||||||||||
December 31, 2013
|
|
|
|
|
|
|
|
|
|
||||||||||
Securities Available-for Sale:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Agency Obligations
|
$
|
136,475
|
|
|
$
|
—
|
|
|
$
|
136,475
|
|
|
$
|
—
|
|
|
|
||
State and Municipal Obligations
|
127,389
|
|
|
—
|
|
|
127,389
|
|
|
—
|
|
|
|
||||||
Mortgage-Backed Securities - Residential
|
175,778
|
|
|
—
|
|
|
175,778
|
|
|
—
|
|
|
|
||||||
Corporate and Other Debt Securities
|
16,798
|
|
|
—
|
|
|
16,798
|
|
|
—
|
|
|
|
||||||
Mutual Funds and Equity Securities
|
1,166
|
|
|
—
|
|
|
1,166
|
|
|
—
|
|
|
|
||||||
Total Securities Available-for-Sale
|
$
|
457,606
|
|
|
$
|
—
|
|
|
$
|
457,606
|
|
|
$
|
—
|
|
|
|
|
|
December 31, 2012
|
|
|
|
|
|
|
|
|
|
||||||||||
Securities Available-for Sale:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Agency Obligations
|
$
|
122,457
|
|
|
$
|
—
|
|
|
$
|
122,457
|
|
|
$
|
—
|
|
|
|
||
State and Municipal Obligations
|
84,838
|
|
|
—
|
|
|
84,838
|
|
|
—
|
|
|
|
||||||
Mortgage-Backed Securities - Residential
|
261,804
|
|
|
—
|
|
|
261,804
|
|
|
—
|
|
|
|
||||||
Corporate and Other Debt Securities
|
8,451
|
|
|
—
|
|
|
8,451
|
|
|
—
|
|
|
|
||||||
Mutual Funds and Equity Securities
|
1,148
|
|
|
—
|
|
|
1,148
|
|
|
—
|
|
|
|
||||||
Total Securities Available-for Sale
|
$
|
478,698
|
|
|
$
|
—
|
|
|
$
|
478,698
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fair Value of Assets and Liabilities Measured on a Nonrecurring Basis:
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2013
|
|
|
|
|
|
|
|
|
|
||||||||||
Other Real Estate Owned and Repossessed Assets, Net
|
$
|
144
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
144
|
|
|
$
|
(79
|
)
|
December 31, 2012
|
|
|
|
|
|
|
|
|
|
||||||||||
Collateral Dependent Impaired Loans
|
$
|
1,020
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,020
|
|
|
$
|
(1,021
|
)
|
Other Real Estate Owned and Repossessed Assets, Net
|
$
|
1,034
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,034
|
|
|
$
|
(19
|
)
|
•
|
Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;
|
•
|
Level 2 - Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;
|
•
|
Level 3 - Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity).
|
Schedule of Fair Values by Balance Sheet Grouping
|
|||||||||||||||||||
|
|
|
|
|
Fair Value Hierarchy
|
||||||||||||||
|
Carrying
Amount
|
|
Fair
Value
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||
December 31, 2013
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and Cash Equivalents
|
$
|
49,980
|
|
|
$
|
49,980
|
|
|
$
|
49,980
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Securities Available-for-Sale
|
457,606
|
|
|
457,606
|
|
|
—
|
|
|
457,606
|
|
|
—
|
|
|||||
Securities Held-to-Maturity
|
299,261
|
|
|
302,305
|
|
|
—
|
|
|
302,305
|
|
|
—
|
|
|||||
Federal Home Loan Bank and Federal Reserve Bank Stock
|
6,281
|
|
|
6,281
|
|
|
6,281
|
|
|
—
|
|
|
—
|
|
|||||
Net Loans
|
1,252,038
|
|
|
1,266,020
|
|
|
—
|
|
|
—
|
|
|
1,266,020
|
|
|||||
Accrued Interest Receivable
|
5,745
|
|
|
5,745
|
|
|
5,745
|
|
|
—
|
|
|
—
|
|
|||||
Deposits
|
1,842,330
|
|
|
1,839,613
|
|
|
1,595,103
|
|
|
244,510
|
|
|
—
|
|
|||||
Federal Funds Purchased and Securities Sold Under Agreements to Repurchase
|
11,777
|
|
|
11,777
|
|
|
11,777
|
|
|
—
|
|
|
—
|
|
|||||
Federal Home Loan Bank Term Advances
|
73,000
|
|
|
74,629
|
|
|
53,000
|
|
|
21,629
|
|
|
—
|
|
|||||
Junior Subordinated Obligations Issued
to Unconsolidated Subsidiary Trusts
|
20,000
|
|
|
20,000
|
|
|
—
|
|
|
20,000
|
|
|
—
|
|
|||||
Accrued Interest Payable
|
439
|
|
|
439
|
|
|
439
|
|
|
—
|
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2012
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and Cash Equivalents
|
$
|
48,832
|
|
|
$
|
48,832
|
|
|
$
|
48,832
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Securities Available-for-Sale
|
478,698
|
|
|
478,698
|
|
|
—
|
|
|
478,698
|
|
|
—
|
|
|||||
Securities Held-to-Maturity
|
239,803
|
|
|
248,252
|
|
|
—
|
|
|
248,252
|
|
|
—
|
|
|||||
Federal Home Loan Bank and Federal Reserve Bank Stock
|
5,792
|
|
|
5,792
|
|
|
5,792
|
|
|
—
|
|
|
—
|
|
|||||
Net Loans
|
1,157,043
|
|
|
1,192,628
|
|
|
—
|
|
|
—
|
|
|
1,192,628
|
|
|||||
Accrued Interest Receivable
|
5,486
|
|
|
5,486
|
|
|
5,486
|
|
|
—
|
|
|
—
|
|
|||||
Deposits
|
1,731,155
|
|
|
1,732,894
|
|
|
1,447,882
|
|
|
285,012
|
|
|
—
|
|
|||||
Federal Funds Purchased and Securities Sold Under Agreements to Repurchase
|
12,678
|
|
|
12,678
|
|
|
12,678
|
|
|
—
|
|
|
—
|
|
|||||
Federal Home Loan Bank Term Advances
|
59,000
|
|
|
60,312
|
|
|
29,000
|
|
|
31,312
|
|
|
—
|
|
|||||
Junior Subordinated Obligations Issued
to Unconsolidated Subsidiary Trusts
|
20,000
|
|
|
20,000
|
|
|
—
|
|
|
20,000
|
|
|
—
|
|
|||||
Accrued Interest Payable
|
584
|
|
|
584
|
|
|
584
|
|
|
—
|
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
Note 18:
|
LEASES (Dollars In Thousands)
|
|
2013
|
|
2012
|
|
2011
|
|
|||
Net Rental Expense
|
$
|
671
|
|
$
|
597
|
|
$
|
570
|
|
|
Operating
Leases
|
|
|
2014
|
$
|
638
|
|
2015
|
583
|
|
|
2016
|
440
|
|
|
2017
|
347
|
|
|
2018
|
277
|
|
|
Later Years
|
448
|
|
|
Total Minimum Lease Payments
|
$
|
2,733
|
|
Note 19:
|
REGULATORY MATTERS (Dollars in Thousands)
|
|
Actual
|
|
Minimum Amounts For Capital Adequacy Purposes
|
|
Minimum Amounts To Be Well-Capitalized
|
|||||||||||||||
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|||||||||
As of December 31, 2013:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Total Capital
(to Risk Weighted Assets):
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Arrow
|
$
|
212,360
|
|
|
15.8
|
%
|
|
$
|
107,524
|
|
|
8.0
|
%
|
|
$
|
134,405
|
|
|
10.0
|
%
|
Glens Falls National
|
172,720
|
|
|
15.4
|
%
|
|
89,725
|
|
|
8.0
|
%
|
|
112,156
|
|
|
10.0
|
%
|
|||
Saratoga National
|
33,396
|
|
|
14.8
|
%
|
|
18,052
|
|
|
8.0
|
%
|
|
22,565
|
|
|
10.0
|
%
|
|||
Tier I Capital
(to Risk Weighted Assets):
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Arrow
|
197,906
|
|
|
14.7
|
%
|
|
53,852
|
|
|
4.0
|
%
|
|
80,778
|
|
|
6.0
|
%
|
|||
Glens Falls National
|
160,849
|
|
|
14.4
|
%
|
|
44,680
|
|
|
4.0
|
%
|
|
67,020
|
|
|
6.0
|
%
|
|||
Saratoga National
|
30,833
|
|
|
13.7
|
%
|
|
9,002
|
|
|
4.0
|
%
|
|
13,504
|
|
|
6.0
|
%
|
|||
Tier I Capital
(to Average Assets):
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Arrow
|
197,906
|
|
|
9.2
|
%
|
|
86,046
|
|
|
4.0
|
%
|
|
86,046
|
|
|
4.0
|
%
|
|||
Glens Falls National
|
160,849
|
|
|
8.8
|
%
|
|
73,113
|
|
|
4.0
|
%
|
|
91,391
|
|
|
5.0
|
%
|
|||
Saratoga National
|
30,833
|
|
|
9.7
|
%
|
|
12,715
|
|
|
4.0
|
%
|
|
15,893
|
|
|
5.0
|
%
|
|
Actual
|
|
Minimum Amounts For Capital
Adequacy Purposes
|
|
Minimum Amounts To Be Well-Capitalized
|
|||||||||||||
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|||||||
As of December 31, 2012:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Total Capital
(to Risk Weighted Assets): |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Arrow
|
$
|
200,480
|
|
|
16.3
|
%
|
|
98,395
|
|
|
8.0
|
%
|
|
122,994
|
|
|
10.0
|
%
|
Glens Falls National
|
164,889
|
|
|
16.2
|
%
|
|
81,427
|
|
|
8.0
|
%
|
|
101,783
|
|
|
10.0
|
%
|
|
Saratoga National
|
31,911
|
|
|
15.1
|
%
|
|
16,906
|
|
|
8.0
|
%
|
|
21,133
|
|
|
10.0
|
%
|
|
Tier I Capital
(to Risk Weighted Assets): |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Arrow
|
185,170
|
|
|
15.0
|
%
|
|
49,379
|
|
|
4.0
|
%
|
|
74,068
|
|
|
6.0
|
%
|
|
Glens Falls National
|
152,205
|
|
|
14.9
|
%
|
|
40,860
|
|
|
4.0
|
%
|
|
61,291
|
|
|
6.0
|
%
|
|
Saratoga National
|
29,297
|
|
|
13.8
|
%
|
|
8,492
|
|
|
4.0
|
%
|
|
12,738
|
|
|
6.0
|
%
|
|
Tier I Capital
(to Average Assets): |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Arrow
|
185,170
|
|
|
9.1
|
%
|
|
81,393
|
|
|
4.0
|
%
|
|
81,393
|
|
|
4.0
|
%
|
|
Glens Falls National
|
152,205
|
|
|
8.8
|
%
|
|
69,184
|
|
|
4.0
|
%
|
|
86,480
|
|
|
5.0
|
%
|
|
Saratoga National
|
29,297
|
|
|
9.4
|
%
|
|
12,467
|
|
|
4.0
|
%
|
|
15,584
|
|
|
5.0
|
%
|
Note 20:
|
PARENT ONLY FINANCIAL INFORMATION (Dollars In Thousands)
|
BALANCE SHEETS
|
December 31,
|
||||||
ASSETS
|
2013
|
|
2012
|
||||
Interest-Bearing Deposits with Subsidiary Banks
|
$
|
3,349
|
|
|
$
|
1,913
|
|
Available-for-Sale Securities
|
1,166
|
|
|
1,148
|
|
||
Held-to-Maturity Securities
|
1,000
|
|
|
1,000
|
|
||
Investment in Subsidiaries at Equity
|
206,680
|
|
|
192,985
|
|
||
Other Assets
|
5,807
|
|
|
5,339
|
|
||
Total Assets
|
$
|
218,002
|
|
|
$
|
202,385
|
|
LIABILITIES
|
|
|
|
||||
Junior Subordinated Obligations Issued to Unconsolidated Subsidiary Trusts
|
$
|
20,000
|
|
|
$
|
20,000
|
|
Other Liabilities
|
5,848
|
|
|
6,560
|
|
||
Total Liabilities
|
25,848
|
|
|
26,560
|
|
||
STOCKHOLDERS
’
EQUITY
|
|
|
|
||||
Total Stockholders
’
Equity
|
192,154
|
|
|
175,825
|
|
||
Total Liabilities and Stockholders
’
Equity
|
$
|
218,002
|
|
|
$
|
202,385
|
|
STATEMENTS OF INCOME
|
Years Ended December 31,
|
||||||||||
Income:
|
2013
|
|
2012
|
|
2011
|
||||||
Dividends from Bank Subsidiaries
|
$
|
12,900
|
|
|
$
|
12,700
|
|
|
$
|
14,450
|
|
Interest and Dividends on Investments
|
116
|
|
|
123
|
|
|
127
|
|
|||
Other Income (Including Management Fees)
|
549
|
|
|
776
|
|
|
596
|
|
|||
Net Gains on Securities Transactions
|
—
|
|
|
63
|
|
|
17
|
|
|||
Total Income
|
13,565
|
|
|
13,662
|
|
|
15,190
|
|
|||
Expense:
|
|
|
|
|
|
||||||
Interest Expense
|
640
|
|
|
692
|
|
|
669
|
|
|||
Salaries and Employee Benefits
|
59
|
|
|
75
|
|
|
92
|
|
|||
Other Expense
|
860
|
|
|
957
|
|
|
820
|
|
|||
Total Expense
|
1,559
|
|
|
1,724
|
|
|
1,581
|
|
|||
Income Before Income Tax Benefit and Equity
|
|
|
|
|
|
||||||
in Undistributed Net Income of Subsidiaries
|
12,006
|
|
|
11,938
|
|
|
13,609
|
|
|||
Income Tax Benefit
|
634
|
|
|
575
|
|
|
477
|
|
|||
Equity in Undistributed Net Income of Subsidiaries
|
9,155
|
|
|
9,666
|
|
|
7,847
|
|
|||
Net Income
|
$
|
21,795
|
|
|
$
|
22,179
|
|
|
$
|
21,933
|
|
STATEMENTS OF CASH FLOWS
|
Years Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Cash Flows from Operating Activities:
|
|
|
|
|
|
||||||
Net Income
|
$
|
21,795
|
|
|
$
|
22,179
|
|
|
$
|
21,933
|
|
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities:
|
|
|
|
|
|
||||||
Undistributed Net Income of Subsidiaries
|
(9,155
|
)
|
|
(9,666
|
)
|
|
(7,847
|
)
|
|||
Net Gains on the Sale of Securities Available-for-Sale
|
—
|
|
|
(63
|
)
|
|
(17
|
)
|
|||
Shares Issued Under the Directors
’
Stock Plan
|
198
|
|
|
175
|
|
|
175
|
|
|||
Stock-Based Compensation Expense
|
372
|
|
|
424
|
|
|
354
|
|
|||
Changes in Other Assets and Other Liabilities
|
(990
|
)
|
|
(1,640
|
)
|
|
(165
|
)
|
|||
Net Cash Provided by Operating Activities
|
12,220
|
|
|
11,409
|
|
|
14,433
|
|
|||
Cash Flows from Investing Activities:
|
|
|
|
|
|
||||||
Proceeds from the Sale of Securities Available-for-Sale
|
45
|
|
|
681
|
|
|
410
|
|
|||
Purchases of Securities Available-for-Sale
|
(45
|
)
|
|
(359
|
)
|
|
(253
|
)
|
|||
Net Cash Provided by Investing Activities
|
—
|
|
|
322
|
|
|
157
|
|
|||
Cash Flows from Financing Activities:
|
|
|
|
|
|
||||||
Stock Options Exercised
|
1,254
|
|
|
2,105
|
|
|
1,413
|
|
|||
Shares Issued Under the Employee Stock Purchase Plan
|
477
|
|
|
484
|
|
|
474
|
|
|||
Shares Issued for Dividend Reinvestment Plans
|
1,280
|
|
|
1,822
|
|
|
1,796
|
|
|||
Tax Benefit for Exercises of Stock Options
|
23
|
|
|
68
|
|
|
51
|
|
|||
Purchase of Treasury Stock
|
(1,709
|
)
|
|
(4,877
|
)
|
|
(6,039
|
)
|
|||
Cash Dividends Paid
|
(12,109
|
)
|
|
(11,815
|
)
|
|
(11,448
|
)
|
|||
Net Cash Used in Financing Activities
|
(10,784
|
)
|
|
(12,213
|
)
|
|
(13,753
|
)
|
|||
Net (Decrease) Increase in Cash and Cash Equivalents
|
1,436
|
|
|
(482
|
)
|
|
837
|
|
|||
Cash and Cash Equivalents at Beginning of the Year
|
1,913
|
|
|
2,395
|
|
|
1,558
|
|
|||
Cash and Cash Equivalents at End of the Year
|
$
|
3,349
|
|
|
$
|
1,913
|
|
|
$
|
2,395
|
|
Supplemental Disclosures to Statements of
Cash Flow Information:
|
|
|
|
|
|
||||||
Interest Paid
|
$
|
640
|
|
|
$
|
692
|
|
|
$
|
669
|
|
Non-cash Investing and Financing Activities:
|
|
|
|
|
|
||||||
Shares Issued for Acquisition of Subsidiary
|
233
|
|
|
233
|
|
|
5,261
|
|
Item 9A.
|
Controls and Procedures
|
Item 9B.
|
Other Information
–
None.
|
Date: March 14, 2014
|
By
/s/ Thomas J. Murphy
Thomas J. Murphy
President and Chief Executive Officer
|
|
|
Date: March 14, 2014
|
By:
/s/ Terry R. Goodemote
Terry R. Goodemote
Executive Vice President, Treasurer and
Chief Financial Officer
(Principal Financial and Accounting Officer)
|
/s/ John J. Carusone, Jr.
John J. Carusone, Jr.
Director
|
/s/ Elizabeth O
’
C. Little
Elizabeth O
’
C. Little
Director
|
|
|
/s/ Tenee R. Casaccio
Tenee R. Casaccio
Director
|
/s/ David L. Moynehan
David L. Moynehan
Director
|
|
|
/s/ Michael B. Clarke
Michael B. Clarke
Director
|
/s/ John J. Murphy
John J. Murphy
Director
|
|
|
/s/ Gary C. Dake
Gary C. Dake
Director
|
/s/ Thomas J. Murphy
Thomas J. Murphy
Director
|
|
|
/s/ Thomas L. Hoy
Thomas L. Hoy
Director and Chairman
|
/s/ Colin L. Reed
Colin L. Reed
Director
|
|
|
/s/ David G. Kruczlnicki
David G. Kruczlnicki
Director
|
/s/ Richard J. Reisman, D.M.D.
Richard J. Reisman, D.M.D.
Director
|
|
|
Exhibit
Number
|
Exhibit
|
3.(i)
|
Certificate of Incorporation of the Registrant, incorporated herein by reference from the Registrant
’
s Annual Report filed on Form 10-K for the year ended December 31, 2007, Exhibit 3.(i)
|
3.(ii)
|
By-laws of the Registrant, as amended, incorporated herein by reference from the Registrant
’
s Current Report on Form 8-K filed on November 24, 2009, Exhibit 3.(ii)
|
4.1
|
Amended and Restated Declaration of the Trust by and among U.S. Bank National Association, as Institutional Trustee, the Registrant, as Sponsor and certain Administrators named therein, dated as of July 23, 2003, relating to Arrow Capital Statutory Trust II, incorporated herein by reference from the Registrant
’
s Quarterly Report on Form 10-Q for the quarter ended September 30, 2003, Exhibit 4.1
|
4.2
|
Indenture between the Registrant, as Issuer, and U.S. Bank National Association, as Trustee, dated as of July 23, 2003, incorporated herein by reference from the Registrant
’
s Quarterly Report on Form 10-Q for the quarter ended September 30, 2003, Exhibit 4.2
|
4.3
|
Placement Agreement by and among the Registrant, Arrow Capital Statutory Trust II and SunTrust Capital Markets, Inc., dated July 23, 2003, incorporated herein by reference from the Registrant
’
s Quarterly Report on Form 10-Q for the quarter ended September 30, 2003, Exhibit 4.3
|
4.4
|
Guarantee Agreement by and between the Registrant and U.S. Bank National Association, dated as of July 23, 2003, incorporated herein by reference from the Registrant
’
s Quarterly Report on Form 10-Q for the quarter ended September 30, 2003, Exhibit 4.4
|
4.5
|
Amended and Restated Trust Agreement among the Registrant, as Depositor, Wilmington Trust Company, as Property Trustee, Wilmington Trust Company, as Delaware trustee, and certain Administrators named therein, dated as of December 28, 2004, relating to Arrow Capital Statutory Trust III, incorporated herein by reference from the Registrant
’
s Annual Report on Form 10-K for the year ended December 31, 2004, Exhibit 4.6
|
4.6
|
Junior Subordinated Indenture between the Registrant, as Issuer, and Wilmington Trust Company, as Trustee, dated as of December 28, 2004, incorporated herein by reference from the Registrant
’
s Annual Report on Form 10-K for the year ended December 31, 2004, Exhibit 4.7
|
4.7
|
Placement Agreement among the Registrant, Arrow Capital Statutory Trust III and SunTrust Capital Markets, Inc., dated December 28, 2004, incorporated herein by reference from the Registrant
’
s Annual Report on Form 10-K for the year ended December 31, 2004, Exhibit 4.8
|
4.8
|
Guarantee Agreement between the Registrant and Wilmington Trust Company, dated as of December 28, 2004, incorporated herein by reference from the Registrant
’
s Annual Report on Form 10-K for the year ended December 31, 2004, Exhibit 4.9
|
10.1
|
1998 Long Term Incentive Plan of the Registrant, incorporated herein by reference from Registrant
’
s 1933 Act Registration Statement on Form S-8, Exhibit 4.1 (File number 333-62719; filed on September 2, 1998)*
|
10.2
|
2008 Long Term Incentive Plan of the Registrant, incorporated herein by reference from the Registrant
’
s Current Report on Form 8-K filed on May 6, 2008, Exhibit 10.1*
|
10.3
|
2013 Long Term Incentive Plan of the Registrant, incorporated herein by reference from the Registrant
’
s Definitive Proxy Statement on Schedule 14A filed on March 20, 2013 as Annex A*
|
10.4
|
Profit Sharing Plan of the Registrant, as amended, incorporated herein by reference from the Registrant
’
s Annual Report filed on Form 10-K for the year ended December 31, 2008, Exhibit 10.6*
|
10.5
|
Directors
’
Deferred Compensation Plan of the Registrant, as amended and restated, incorporated herein by reference from the Registrant
’
s Annual Report filed on Form 10-K for the year ended December 31, 2008, Exhibit 10.7*
|
10.6
|
Directors
’
Stock Plan of the Registrant incorporated herein by reference from the Registrant’s Definitive Proxy Statement on Schedule 14A filed on March 20, 2013 as Annex B*
|
10.7
|
Select Executive Retirement Plan of the Registrant for benefits accrued or vested after December 31, 2004, as amended and restated, incorporated herein by reference from the Registrant
’
s Annual Report filed on Form 10-K for the year ended December 31, 2008, Exhibit 10.9*
|
10.8
|
Select Executive Retirement Plan of the Registrant for benefits accrued or vested on or before December 31, 2004, as amended and restated, incorporated herein by reference from the Registrant
’
s Annual Report filed on Form
10-K for the year ended December 31, 2008, Exhibit 10.10*
|
10.9
|
Senior Officers Deferred Compensation Plan of the Registrant, as amended, incorporated herein by reference from the Registrant
’
s Annual Report filed on Form 10-K for the year ended December 31, 2008, Exhibit 10.11*
|
10.10
|
Short Term Incentive Plan of the Registrant, as amended, incorporated herein by reference from the Registrant
’
s Annual Report filed on Form 10-K for the year ended December 31, 2008, Exhibit 10.12*
|
Exhibit
Number
|
Exhibit
|
10.11
|
Consulting Agreement between the Registrant and Thomas L. Hoy, effective January 1, 2013 incorporated herein by reference from the Registrant's Annual Report on Form 10-K for the year ended December 31, 2012, Exhibit 10.13
|
10.12
|
Employment Agreement between the Registrant and Thomas J. Murphy, President and Chief Executive Officer, effective February 1, 2014 incorporated herein by reference from the Registrant's Current Report on Form 8-K , filed February 4, 2014, Exhibit 10.1*
|
10.13
|
Employment Agreement between the Registrant and Terry R. Goodemote, Executive Vice President and Chief Financial Officer, effective February 1, 2014 incorporated herein by reference from the Registrant's Current Report on Form 8-K, filed February 4, 2014, Exhibit 10.2*
|
10.14
|
Employment Agreement between the Registrant and David S. DeMarco, Senior Vice President, effective February 1, 2014 incorporated herein by reference from the Registrant's Current Report on Form 8-K , filed February 4, 2014, Exhibit 10.3*
|
14
|
Financial Code of Ethics, incorporated herein by reference from the Registrant
’
s Annual Report on Form 10-K for the year ended December 31, 2003, Exhibit 14
|
|
|
|
|
Date of Exercise
:
|
No. of Shares Exercised
:
|
No. of Shares Remaining as to Which Option Relates
:
|
|
|
|
|
|
|
Date of Exercise
:
|
No. of Shares Exercised
:
|
No. of Shares Remaining as to Which Option Relates
:
|
|
|
|
|
|
|
Date of Exercise
:
|
No. of Shares Exercised
:
|
No. of Shares Remaining as to Which Option Relates
:
|
|
|
|
|
|
|
a.
|
Any capitalized term or phrase used in this Amendment shall have the same meaning as the meaning ascribed to such term or phrase in the Engagement Agreement unless expressly otherwise defined in this Amendment.
|
b.
|
Except as amended by this Amendment, the terms of the Engagement Agreement remain in full force and effect.
|
1.
|
Participants eligible to receive Retirement Benefits under this Schedule B shall consist of those employees or former employees of the Employer or Participating Employer who qualify as a select group of management or highly compensated employees as set forth in ERISA, and whose benefits under the Defined Benefit Pension Plan and/or ESOP have been limited, as described below, by Section 415 and/or Section 401(a)(17) of the Code or are otherwise deemed by the Board or, effective October 18, 2013, the Administrator thereof, not to be sufficient and, effective January 1, 2008, to which the Board or the Administrator, as applicable, has granted eligibility in writing under the Plan.
|
2.
|
Any employee or former employee shall become a Participant in the Plan if:
|
a.
|
His Compensation, as defined in the Defined Benefit Pension Plan or ESOP, for the current Plan Year or any prior Plan Year would exceed, if not for such limitation, the amount specified in Section 401(a)(17) of the Code ($210,000 in 2005); or
|
b.
|
His projected annual pension benefit under the Defined Benefit Pension Plan, if determined without regard to the benefit limits imposed by Section 415(b) of the Code or the compensation limit imposed by Section 401(a)(17) of the Code, would exceed the dollar amount specified in Section 415(b)(1) of the Code ($170,000 for 2005); or
|
c.
|
His annual additions, as defined in Section 415(c)(2) of the Code, under the ESOP, if determined without regard to the annual additions limits imposed by Section 415(c) of the Code or the compensation limit imposed by Section 401(a)(17) of the Code, for any Plan Year beginning after 1993, would exceed the dollar amount specified in Section 415(c)(1) of the Code ($42,000 for 2005);
|
d.
|
and, effective January 1, 2008, the Board or, effective October 18, 2013, the Administrator thereof, has granted eligibility in writing under the Plan to the employee.
|
3.
|
Retirement Benefits payable under this Schedule B by reason of Code limitations shall be the Actuarial Equivalent, as defined in the Defined Benefit Pension Plan, of:
|
a.
|
The Vested annual Retirement Benefit to which the Participant or surviving spouse would be eligible to receive at the time of retirement or death as determined under the Defined Benefit Pension Plan formula based upon the Participant’s Compensation, as defined in the Defined Benefit Pension Plan but without regard to the limit imposed by Section 401(a)(17) of the Code, and without regard to any benefit limitation under Section 415(b) of the Code, adjusted for the form of payment selected by the Participant, less
|
b.
|
The annual pension benefit that is payable to the Participant or surviving spouse under the Defined Benefit Pension Plan, less
|
c.
|
The benefit accrued and vested under the Plan as of December 31, 2004 under the terms of the Plan as then in effect (“Grandfathered Benefit”).
|
4.
|
Additional ESOP Benefits shall be payable under this Schedule B to any Participant who, for any Plan Year beginning on or after January 1, 1994, receives an allocation under the ESOP which is less than the allocation he would have received if the limitations imposed by Section 415(c) and Section 401(a)(17) of the Code did not apply.
|
a.
|
As of the last day of each Plan Year, such a Participant shall receive an allocation under the Plan equal to the sum of (i), (ii) and (iii) below:
|
(i)
|
Phantom Share Allocation - an allocation of phantom shares of Employer stock equal to the excess, if any, of (1) over (2), where:
|
1.
|
is the number of shares of Employer stock that would have been allocated to the Participant’s account under the ESOP with respect to such Plan Year if the limitations of Sections 415(c) and 401(a)(17) of the Code were disregarded, and
|
2.
|
is the number of shares of Employer stock actually allocated to the Participant’s account under the ESOP for such Plan Year.
|
(ii)
|
Cash Allocation - a dollar amount allocation equal to the excess, if any, of (1) over (2), where:
|
1.
|
is the dollar amount that would have been allocated in cash to the Participant’s account under the ESOP with respect to such Plan Year if the limitations of Sections 415(c) and 401(a)(17) of the Code were disregarded, and
|
2.
|
is the dollar amount actually allocated in cash to the Participant’s account under the ESOP for such Plan Year.
|
(iii)
|
Dividend and Interest Allocation - Stock and cash dividends on Employer stock shall be credited to the Participant’s Phantom Share Account when paid, as if such phantom shares were actual shares, and interest on the value of the Participant’s Cash Account, determined as of the last day of the immediately preceding Plan Year, shall be allocated at a rate to be determined annually by the Plan Administrator and credited to the Participant’s Cash Account as of the last day of the Plan Year.
|
b.
|
Additional ESOP Benefits, if any, shall be distributed to the Participant, or his Beneficiary, in a single lump sum cash payment within 90 days after the date of termination of his employment in an amount equal to the Vested portion of:
|
(i)
|
The number of phantom shares of Employer stock credited to the Participant’s Phantom Share Account as of the last day of the Plan Year coinciding with or immediately preceding the date of distribution, multiplied by the fair market value of one share of the Employer’s stock as determined by the Plan Administrator in its discretion; plus
|
(ii)
|
The value of the Participant’s Cash Account as of the same date.
|
c.
|
This section shall apply to benefits that have accrued or become vested after December 31, 2004, including any increase attributable to Grandfathered Benefits’ investment experience after December 31, 2004.
|
Subsidiary
|
Percent of Common Stock Owned
|
Subsidiaries of Arrow Financial Corporation
:
|
|
Glens Falls National Bank and Trust Company
A Nationally Chartered Commercial Bank
Headquarters: Glens Falls, NY
|
100
|
Saratoga National Bank and Trust Company
A Nationally Chartered Commercial Bank
Headquarters: Saratoga Springs, NY
|
100
|
Arrow Capital Statutory Trust II
A Non-deposit Trust Company
Headquarters: Glens Falls, NY
|
100
|
Arrow Capital Statutory Trust III
A Non-deposit Trust Company
Headquarters: Glens Falls, NY
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100
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Subsidiaries of Glens Falls National Bank and Trust Company:
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Arrow Properties, Inc.
A Real Estate Investment Trust
(Glens Falls National Bank also holds approximately 82%
of non-voting preferred stock)
Headquarters: Glens Falls, NY
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100
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North Country Investment Advisers, Inc.
A New York Corporation
Headquarters: Glens Falls, NY
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100
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NC Financial Services, Inc.
A New York Corporation
Headquarters: Warrensburg, NY
|
90
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Glens Falls National Community Development Corporation
A New York Corporation
Headquarters: Glens Falls, NY
|
100
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Capital Financial Group, Inc.
A New York Corporation
Headquarters: South Glens Falls, NY
|
100
|
Loomis & LaPann, Inc.
A New York Corporation
Headquarters: South Glens Falls, NY
|
100
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Upstate Agency, LLC
A New York Corporation
Headquarters: Warrensburg, NY
|
100
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Glens Falls National Insurance Agencies, LLC
A New York Corporation
Headquarters: South Glens Falls, NY
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100
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Subsidiaries of Saratoga National Bank and Trust Company:
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NC Financial Services, Inc.
A New York Corporation
Headquarters: Warrensburg, NY
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10
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
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5.
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The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
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5.
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The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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