Executive Summary

Operating EPS of $0.88 beat S&P Global consensus of $0.83; GAAP EPS was $0.44 due to $17.2M merger costs and $13.0M acquisition-related provision, highlighting strong core earnings despite transitory charges* .
Net interest margin rose to 3.59% (+15 bps QoQ; +41 bps YoY) on higher earning-asset yields and Evans accretion; net interest income increased 15.9% QoQ to $124.2M .
SPGI “Revenue” came in below consensus ($153.3M actual vs $170.9M estimate), while fee mix reflected seasonal declines; operating EPS strength was driven by margin expansion and Evans balance sheet addition* .
Dividend raised 8.8% to $0.37 for Q3; $118M sub debt redeemed in July, avoiding a reset to >9% and lowering funding cost toward ~4.4%, a durable tailwind to interest expense .

Note: Consensus figures from S&P Global.
*Values retrieved from S&P Global.

What Went Well and What Went Wrong

What Went Well

“Continued improvement in net interest margin... and the additive impact of our successful merger with Evans” drove operating EPS +28% YoY and +10% QoQ (to $0.88) .
NIM expanded to 3.59% (FTE), with earning asset yields up 17 bps QoQ to 5.12%; net interest income rose +$17.0M QoQ (+$27.0M YoY) .
Credit metrics improved: net charge-offs fell to 0.09% (annualized) from 0.27% in Q1; nonperforming assets/total assets fell to 0.29% from 0.35% .

What Went Wrong

Total provision rose to $17.8M, including $13.0M acquisition-related provision and modest macro forecast deterioration; GAAP EPS was depressed by merger-related costs .
Noninterest income slipped 1.5% QoQ (seasonal insurance, prior BOLI gain), and SPGI revenue missed consensus despite strong net interest income* .
Deposit costs ticked up 2 bps QoQ to 1.51% (from Evans’ higher-cost checking/savings), partially offset by lower time-deposit costs .

Financial Results

Metric	Q2 2024	Q4 2024	Q1 2025	Q2 2025
Operating Diluted EPS ($)	$0.69	$0.77	$0.80	$0.88
GAAP Diluted EPS ($)	$0.69	$0.76	$0.77	$0.44
Net Interest Income ($MM)	$97.2	$106.1	$107.2	$124.2
Noninterest Income ($MM)	$43.2	$42.4	$47.5	$46.9
Net Interest Margin (FTE, %)	3.18%	3.34%	3.44%	3.59%

Estimates vs Actual (S&P Global):

Metric	Q1 2025	Q2 2025
Primary EPS Consensus Mean ($)	0.742 (est) / 0.80 (act)	0.827 (est) / 0.88 (act)
Revenue Consensus Mean ($MM)	151.0 (est) / 147.1 (act)	170.9 (est) / 153.3 (act)

Note: Values retrieved from S&P Global.

Noninterest Income Breakdown ($MM):

Category	Q2 2024	Q1 2025	Q2 2025
Service charges	$4.22	$4.24	$4.58
Card services	$5.59	$5.32	$6.08
Retirement plan admin	$14.80	$15.86	$15.71
Wealth management	$10.17	$10.95	$10.68
Insurance services	$3.85	$4.76	$4.10
BOLI income	$1.83	$3.40	$2.18
Net securities gains (losses)	($0.09)	($0.10)	$0.11
Other	$2.87	$3.03	$3.50

KPIs and Balance Sheet:

KPI	Q2 2024	Q4 2024	Q1 2025	Q2 2025
Total deposits ($MM)	$11,271	$11,547	$11,709	$13,515
Loan-to-deposit ratio (%)	87.4%	86.3%	85.2%	86.0%
Net charge-offs / avg loans (%)	0.15%	0.23%	0.27%	0.09%
NPLs / total loans (%)	0.39%	0.52%	0.48%	0.40%
Allowance / total loans (%)	1.22%	1.16%	1.17%	1.21%
CET1 ratio (%)	11.70%	11.93%	12.12%	11.37%

Loans by Line of Business ($MM):

Segment	Q2 2024	Q1 2025	Q2 2025
Commercial & industrial	$1,398	$1,437	$1,692
Commercial real estate	$3,784	$3,890	$4,800
Residential real estate	$2,135	$2,128	$2,530
Home equity	$327	$331	$423
Indirect auto	$1,226	$1,309	$1,319
Residential solar & other consumer	$985	$885	$859
Total loans	$9,854	$9,980	$11,625

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
NIM (FTE) trajectory	Q3 2025	No formal numeric guidance	“Couple of bps” improvement from full-quarter Evans accretion ($1–$1.5M) plus modest repricing; funding costs “stabilized”	Raised/positive
Noninterest expense (ex-merger)	Go-forward	~$99.9M in Q1 run-rate	~$105.4M in Q2 ex-merger; Evans adds ~$11–$12M per quarter; Q3 adds one more month of Evans	Higher due to Evans
Net charge-offs run-rate	Go-forward	Q1 actual $6.6M	Expect $3–$5M per quarter (more typical)	Lower/normalized
Dividend	Q3 2025	$0.34 (Q2 dividend)	$0.37 (+8.8%) payable Sept 15; 13th consecutive annual increase	Raised
Sub debt interest cost	H2 2025	Fixed 5.45% pre-reset	$118M redeemed; avoided reset to >9%; replacement liquidity ~4.25–4.4%	Lower cost of funds
Effective tax rate	Q2 2025	—	26.7% (higher due to merger costs and mix)	Informational

Earnings Call Themes & Trends

Topic	Previous Mentions (Q4’24 and Q1’25)	Current Period (Q2’25)	Trend
Net interest margin	Q4: NIM up 7 bps; funding mix improved . Q1: NIM up 10 bps; deposit costs pushed down .	NIM 3.59%; further improvement from asset yields and Evans accretion .	Improving, but competition may cap upside .
Deposit costs	Q4: Total deposit cost down 12 bps . Q1: cost declines accelerated; sensitivity in $5B deposits .	Total deposit cost up 2 bps from Evans mix; time deposit cost declined .	Stabilizing with minor upward mix effect.
Loan growth & pipeline	Q1: Guided to 2–3% amid uncertainty .	Pipeline at record levels; execution slowed by macro uncertainty .	Good pipelines; timing cautious.
Fee businesses	Q4: Retirement/WMA strong; insurance seasonal . Q1: Noninterest income 31% of revenue .	Fee income 27% of revenue; seasonal insurance/BOLI normalization; card fees up with Evans .	Solid; mix tilts spread-heavy post Evans.
Semiconductors/CHIPS	Q1: Anticipated late-2025 start; 2027–2028 production .	Engagement continues; Micron federal incentives supportive .	Constructive ecosystem build-out.
Competition & pricing	Q1: Generally rational; episodic small-bank defense .	Indirect auto got more competitive; holding spreads; focus on multi-product C&I/owner-occupied CRE .	Competition steady; pricing discipline maintained.
Liquidity/securities	Q1: Pre-positioned investments ahead of Evans; collateral needs .	Sold ~$255M Evans AFS; added liquidity; reinvest opportunistically .	Ample liquidity, selective reinvestment.
M&A appetite	Q1: Focused on Evans; opportunistic fill-ins .	Integration progressing; cost synergies ~25% largely realized; remain methodical on future M&A .	Integration-focused, selective.
Credit quality	Q4/Q1: CRE episodic NCOs; solar/auto drive consumer NCOs .	NCOs down; reserve covers ~3x NPLs; expect NCOs normalize to $3–$5M/qtr .	Improving with conservative reserves.
Tariffs/macro	Q1: Episodic impacts (Canada feed) .	“Uncertainty does not inspire action”; selective tariff effects remain episodic .	Macro hesitancy; limited tariff impact.

Management Commentary

CEO: “Operating earnings per share... were 28% above the second quarter of 2024 and 10% higher than the first quarter of this year,” citing Evans merger and NIM improvement .
CFO (NIM outlook): “One additional month of accretion... $1–$1.5M... a couple of basis points improvement... and a few basis points from asset repricing; funding costs are pretty well stabilized” .
CFO (expenses and synergies): “Total operating expenses, excluding acquisition expenses, were $105.4M... Evans probably adds $11–$12M a quarter,” with 25% cost synergies largely realized .
CFO (credit): “Provision... $17.8M... due to $13.0M acquisition-related provision... reserve coverage 1.21%... covered three times the level of nonperforming loans” .
CEO (Western NY expansion): “We opened 18 Evans Bank branches as NBT Bank... welcomed 200 Evans employees... response from customers and communities has been overwhelmingly positive” .

Q&A Highlights

Margin sensitivity to rate cuts: Balance sheet is “fairly neutrally positioned” with ~$2.5B loans repricing down and ~~40% deposits (~~$5.5B) able to reprice lower, with some lag; NIM outlook for Q3 modestly higher from Evans accretion .
Revenue synergies: Wealth and insurance have “great opportunity” to expand in Western NY; insurance growth may lag due to annual cycles .
Expense run-rate: Ex-merger ~$105M in Q2; Evans adds $11–$12M/quarter; Q3 includes an extra month of Evans .
Liquidity and sub debt: Post-merger liquidity elevated; $118M sub debt redeemed (avoiding >9% reset), replacement liquidity ~4.25–4.4% .
Credit normalization: Q2 NCOs were unusually low; forward run-rate expected $3–$5M per quarter; consumer runoff continues in solar/other .

Estimates Context

EPS: Operating EPS beat S&P Global consensus ($0.88 vs $0.83), continuing recent beats in Q1 ($0.80 vs $0.74)*.
Revenue: SPGI “Revenue” missed ($153.3M vs $170.9M est)* despite strong net interest income; mix and classification differences for banks may drive divergence.
Implications: Consensus may lift EPS on sustained NIM tailwinds and Evans accretion; revenue models may be recalibrated to company post-merger mix and seasonality*.

Note: Consensus figures from S&P Global.

Key Takeaways for Investors

Core earnings strength: Operating EPS beat and NIM expansion signal durable earnings power; GAAP EPS impacted by transitory merger expenses and acquisition-related provision .
Integration progressing: Evans adds ~$1.7B loans and ~$1.9B deposits; cost synergies largely realized; expect incremental margin lift in Q3 from full-quarter accretion .
Funding tailwind: Sub debt redemption avoids reset to >9% and reduces interest expense, improving run-rate profitability .
Credit normalization: Expect NCOs to revert to $3–$5M/qtr; reserve coverage ~3x NPLs provides cushion .
Mix shift: Fee income robust but now 27% of revenues post Evans; watch card/wealth expansion in Western NY for cross-sell upside .
Near-term trading: Dividend increase to $0.37 and visible NIM trajectory are potential catalysts; monitor Q3 NIM/expense run-rate confirmation .
Medium-term thesis: Margin tailwinds, disciplined competition, and targeted M&A/organic fill-ins across the footprint (Buffalo to Portland) support compounding earnings with diversified fee streams .

NBT BANCORP INC (NBTB)·Q2 2025 Earnings Summary