Executive Summary

Solid quarter with core operating momentum: NIM expanded 29 bps sequentially to 3.31% on sharply lower deposit/borrowing costs; PTPP rose 26% q/q to $4.18M on stronger net interest income and better efficiency (66.84%) .
EPS of $0.41 diluted vs $0.69 in Q4 (which included ~$1.4M after-tax gain on the insurance agency sale) and $0.34 in Q1’24; net income $3.0M vs $2.1M in Q1’24 .
Funding mix and liquidity improved: core deposits rose to 78.31% of total; total deposits +5% q/q to $1.26B; borrowings cut ~49% q/q to $44.6M; loans/deposits improved to 72.1% .
Asset quality inflected: NPLs fell 40% q/q to 1.45% of loans; annualized NCOs dropped to 0.15%; ACL/loans increased to 1.91% .
Estimates: No published S&P Global consensus for Q1’25 EPS or revenue; beat/miss vs Street not assessable (S&P Global data query returned no consensus)*.

What Went Well and What Went Wrong

What Went Well
- Net interest spread recovery: NIM up to 3.31% (from 3.02% in Q4) as deposit and borrowing costs fell; ~$347k of recovered/prepay interest contributed ~10 bps, but the bulk was structural (pricing discipline, mix) .
- Funding and liquidity: core deposits increased to 78.31% of deposits, enabling a near-halving of borrowings to $44.6M; deposits +10.3% y/y to $1.26B .
- Credit normalization: NPLs down to 1.45% of loans (from 2.40% in Q4); NCOs annualized 0.15%; provision moderated to $457k (from $988k in Q4 and $9.0M in Q3) .
- CEO tone: “disciplined loan and deposit pricing” expanded NIM; “optimizing non-interest expenses” improved efficiency; proactive credit risk management highlighted opportunity to enhance loan quality .
What Went Wrong
- Noninterest income normalization: dropped to $1.2M vs $4.9M in Q4 given the one-time $3.2M pre-tax gain on insurance agency sale and seasonality/catch-up items (e.g., $158k debit card interchange catch-up) .
- Expense buckets mixed: Salaries/benefits rose q/q (+$327k) on higher stock comp and payroll tax; building/occupancy up y/y with East Syracuse branch costs .
- EPS down q/q: $0.41 diluted vs $0.69 in Q4 due to absence of one-time gain; though operating metrics improved, optics could screen as a decline sequentially without context .

Financial Results

Headline P&L, margins, and efficiency vs prior periods and (if available) estimates

Metric	Q1 2024	Q3 2024	Q4 2024	Q1 2025
Total Revenue (non-GAAP) ($M)	$11.29	$13.63	$12.31	$12.62
Net Interest Income ($M)	$9.40	$11.73	$10.82	$11.41
Noninterest Income ($M)	$1.74	$1.71	$4.91	$1.20
PTPP ($M)	$3.58	$3.37	$3.76	$4.18
Net Income ($M)	$2.12	$(4.64)	$4.28	$2.97
Diluted EPS ($)	$0.34	$(0.75)	$0.69	$0.41
Net Interest Margin (%)	2.75%	3.34%	3.15%	3.31%
Efficiency Ratio (%)	68.29%	75.28%	69.42%	66.84%

Balance sheet and credit KPIs

KPI	Q1 2024	Q3 2024	Q4 2024	Q1 2025
Loans ($M)	$891.5	$921.7	$919.0	$912.2
Deposits ($M)	$1,146.1	$1,196.2	$1,204.4	$1,264.5
Borrowings ($M, ST+LT)	$137.4	$100.1	$88.1	$44.6
Core Deposits / Total Deposits (%)	69.17%	77.45%	76.87%	78.31%
Loans / Deposits (%)	77.79%	77.05%	76.30%	72.14%
NPLs / Loans (%)	2.20%	1.75%	2.40%	1.45%
ACL / Loans (%)	1.87%	1.87%	1.88%	1.91%
Annualized NCOs / Avg Loans (%)	0.01%	3.82%	0.44%	0.15%
ROA (%)	0.59%	-1.25%	1.17%	0.81%
ROE (%)	7.01%	-14.79%	14.09%	9.64%

Notes: “Total Revenue (non-GAAP)” per company definition = NII + noninterest income – realized securities gains/losses – gain on insurance agency sale .

Segment breakdown: Not applicable (community bank; no reportable segments disclosed in Q1 PR/Q4 PR/Q3 PR).

Guidance Changes

No formal quantitative guidance was issued in Q1’25 across revenue, margin, expenses, or tax. Dividend policy unchanged at $0.10 per share for the quarter.

Metric	Period	Previous Guidance	Current Guidance	Change
Dividend per share	Q1 2025	$0.10 (Q4’24)	$0.10 declared Mar 31, 2025	Maintained

Management reiterated strategic priorities (core deposit growth, disciplined pricing, proactive credit risk management) rather than numeric guidance .

Earnings Call Themes & Trends

No Q1’25 earnings call transcript was published in our document set; themes below reflect management’s press release commentary and prior quarter disclosures.

Topic	Previous Mentions (Q3 2024)	Previous Mentions (Q4 2024)	Current Period (Q1 2025)	Trend
Credit risk management	Comprehensive loan portfolio review; large provision; NPLs cut 34% q/q; ACL 1.87%	Provision normalized; ACL 1.88%	NPLs -40% q/q to 1.45%; provision $457k; ACL 1.91%	Improving asset quality; steady reserving
Core deposit franchise	East Syracuse acquisition boosted core deposits; reduced brokered and borrowings	Continued deposit mix optimization	Core deposits 78.31%; deposits +5% q/q; borrowings -49% q/q	Positive mix shift, funding cost relief
NIM trajectory	3.34% (incl. 25 bps catch-up)	3.15% (no catch-up)	3.31% (10 bps from recoveries/prepay), broad-based cost relief	Structurally higher vs 1H’24
Noninterest income	Stable ex-one-offs; BOLI death benefit in Q3	$3.2M gain on insurance agency sale	Rebased lower post-sale; debit card fee catch-up hit	Normalizing at lower run-rate
Operating efficiency	Elevated in Q3 due to deal costs	69.42%; expense control cited	Improved to 66.84%	Improving
Regional growth/tech tailwinds	Syracuse expansion emphasized	Continued investment in Syracuse	“Major investments in our region’s growing tech sector” seen as opportunity	Supportive demand backdrop

Management Commentary

Strategic focus: “disciplined loan and deposit pricing has helped expand net interest margin… efforts toward optimizing non-interest expenses have improved our efficiency” (James A. Dowd, CEO) .
Credit posture: “deeply committed to strengthening our proactive credit risk management practices… beginning of a sustained, long-term strategy to enhance the quality of our loan portfolio” .
Regional growth: “Major investments in our region’s growing tech sector are creating new opportunities” while staying “close to our customers” amid macro/policy changes .
Prior quarters context: Emphasis on cost management and risk practices after Q3 portfolio review; investments to expand middle-market presence in Syracuse and integration of East Syracuse branch .

Q&A Highlights

We did not find a Q1’25 earnings call transcript or Q&A in the available filings/press materials; no analyst Q&A themes to report from primary sources (no transcript in document set searched 1/1/25–7/31/25).

Estimates Context

S&P Global consensus: No published consensus for Q1’25 EPS or revenue; therefore, a beat/miss versus Street cannot be determined at this time (S&P Global data query returned no consensus for “Primary EPS Consensus Mean” or “Revenue Consensus Mean” for Q1 2025)*.

Where estimates may need to adjust:

Absent consensus, we note operating upside drivers for future periods: sustained funding cost relief (core deposits mix), normalized credit costs, and steady PTPP improvement. Potential offset: noninterest income reset post-insurance sale and interchange catch-up .

Key Takeaways for Investors

Core margin recovery appears sustainable: NIM 3.31% with broad-based funding cost relief beyond one-time loan recoveries; monitor deposit betas as rates evolve .
Balance sheet de-risking progressed: NPLs down to 1.45% and NCOs normalized; provision moderated; credit is no longer a headline drag, improving earnings visibility .
Funding mix is a tailwind: higher core deposit ratio and lower borrowings should support further cost-of-funds declines and margin resilience if the rate backdrop cooperates .
Operating discipline: Efficiency ratio improved to 66.84%; continued focus on expense control while integrating regional growth initiatives in Syracuse .
Noninterest income has reset lower post-agency sale; expect more bank-like fee seasonality (e.g., interchange) rather than one-time gains .
Near-term trading setup: Narrative likely shifts from credit repair to margin/efficiency traction; any additional credit clean-up or deposit cost surprises would be the main risk to the trajectory .
Medium-term: Regional tech investment and in-market expansion could underpin loan growth when credit risk appetite allows; watch core deposits retention and loan pricing discipline through the cycle .

Footnotes:

S&P Global estimates: Our S&P Global query for Q1 2025 returned no consensus values for EPS or revenue; thus, estimate comparisons are unavailable (values retrieved from S&P Global).

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