More annual reports from Arrow Financial Corporation:
2023 ReportPeers and competitors of Arrow Financial Corporation:
First Republic BankPerformance Comparisons $2.50 $2.04 $2,988 $2,760 $2,605 $2,446 $2,217 $1.86 $1.74 $1.66 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 DILUTED EARNINGS PER SHARE For the 12 Months Ended December 31* ASSETS As of December 31 ($ in Millions) $1.00 $.95 $.92 $.88 $.90 $2,117 $2,245 $2,346 $1,903 $2,030 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 CASH DIVIDENDS PAID PER SHARE DEPOSITS For the 12 Months Ended December 31* As of December 31 ($ in Millions) $17.40 $16.28 $18.63 $14.29 $15.13 $214 $201 $233 $270 $250 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 BOOK VALUE PER SHARE SHAREHOLDERS’ EQUITY As of December 31* As of December 31 ($ in Millions) *Per share amounts have been restated for stock dividends distributed. Fellow Shareholders: 2018 FINANCIAL HIGHLIGHTS I am proud to share the enclosed report highlighting the 2018 financial performance and remarkable accom- plishments of Arrow Financial Corporation and our family of companies. Through hard work, we demonstrated steady growth, improved profitability, and a constant commitment to serving our customers and their communities. Some key points of interest from this past year included: Double-digit growth in our loan portfolio for the fifth consecutive year, reaching a record high of $2.2 billion in total loan balances at year-end. New records for net income, year-end total assets and total equity. Our cash dividend inceased to $0.26 per share in Q3 – the first actual increase in our cash dividend since 2008. American Banker’s “Mid-tier Performers” list ranked Arrow 31st out of more than 200 financial institutions. It is one of only three New York banks, and the only one from the Capital Region, to appear in the top 50. Both Glens Falls National Bank and Saratoga National Bank maintained 5-Star Superior ratings from BauerFinancial. Saratoga National was named “Top Small Community Lender” by the U.S. Small Busi- ness Administration for the Capital Region for the fifth consecutive year. Saratoga National also announced plans for further expansion into the Capital Region with its 11th location, opening in Rotterdam, N.Y. this year. We completed a multi-year, multi- phase strategic plan to unify our insurance offerings. Capital Financial Group is now the Net Income: $36.3 million, up 23.7% Total Loans: $2.20 billion, up 12.6% Total Deposits: $2.35 billion, up 4.5% Total Assets: $2.99 billion, up 8.3% Return on Average Equity: 13.96% Return on Average Assets: 1.27% Return on Tangible Equity: 15.38% Stock Dividend: 3% distributed in Sept. Current Quarterly Cash Dividend: $0.26 Book Value Per Share: Increase of 7.1% Shareholders’ Equity: Increase of 8.0% “Employee Benefits Division” of Upstate Agency, allowing us to deliver more value and greater efficiency to our customers. None of these accomplishments would have been possible without the efforts of our Arrow Team. I’d like to personally give my thanks to them for their continued dedication and efforts. We continue to focus on long-term oppor- tunities that drive our business forward. Like most other financial institutions, we face the pressures of economic conditions beyond our control. Through strategic planning, spending and investments, we will remain a strong company that is well-positioned to deliver value to our customers, our communi- ties, our employees and our shareholders. Thank you for your continued trust, support and partnership. Sincerely, Tom Murphy President and Chief Executive Officer Consolidated Statements of Income (Unaudited) Years Ended December 31 (in thousands, except per-share amounts) 2014 2015 2016 2017 2018 Interest and Dividend Income Interest Expense $ 66,861 5,767 $ 70,738 4,813 $ 76,915 5,356 $ 84,657 7,006 $ 96,503 12,485 Net Interest Income Provision for Loan Losses Net Interest Income after Provision for Loan Losses Total Noninterest Income Total Noninterest Expense Income Before Taxes Provision for Income Taxes 61,094 1,848 59,246 28,316 54,028 33,534 10,174 65,925 1,347 64,578 28,124 57,430 35,272 10,610 71,559 2,033 69,526 27,832 59,609 37,749 11,215 77,651 2,736 74,915 27,645 62,705 39,855 10,529 84,018 2,607 81,411 28,949 65,055 45,305 9,026 Net Income $ 23,360 $ 24,662 $ 26,534 $ 29,326 $ 36,279 Share and Per Share Data Diluted Average Shares Outstanding Diluted Earnings Per Share Cash Dividends Per Share Book Value Per Share Tangible Book Value Per Share Key Earnings Ratios Return on Average Assets Return on Average Equity Return on Tangible Equity Net Interest Margin Capital Ratios Tier 1 Leverage Ratio Total Risk-Based Capital Ratio Asset Quality Ratios Nonperforming Assets to Period-End Assets Allowance for Loan Losses to Period-End Loans 14,080 $ 1 .66 $ .88 $ 14.29 $ 12.46 14,142 $ 1. 74 $ .90 $ 15. 1 3 $ 13.37 14,296 $ 1.86 $ .92 $ 16.28 $ 14.56 14,406 $ 2.04 $ .95 $ 17.40 $ 15. 7 1 14,488 $ 2.50 $ 1.00 $ 18.63 $ 16.99 1.07% 11.79% 13.56% 2.95% 1.05% 11.86% 13.50% 2.97% 1.06% 11.79% 13.25% 3.00% 1.09% 12.14% 13.51% 3.02% 1.27% 13.96% 15.38% 3.07% 9.44% 15.54% 9.25% 15.09% 9.47% 15.15% 9.49% 14.98% 9. 6 1 % 14.86% 0.37% 0.36% 0.28% 0.28% 0.23% 1.10% 1.02% 0.97% 0.95% 0.92% Consolidated Balance Sheets (Unaudited) As of December 31 (in thousands) 2014 2015 2016 2017 2018 Assets Cash and Due from Banks Interest-Bearing Deposits at Banks Investment Securities Loans Allowance for Loan Losses Net Loans Premises and Equipment, Net Goodwill and Intangible Assets, Net Other Assets $ 35,081 $ 34,816 $ 43,024 $ 42,562 $ 56,529 11,214 673,014 1,413,268 (15,570) 16,252 731,759 1,573,952 (16,038) 14,331 703,335 1,753,268 (17,012) 30,276 646,056 1,950,770 (18,586) 27,710 618,291 2,196,215 (20,196) 1,397,698 28,488 1,557,914 27,440 1,736,256 26,938 1,932,184 27,619 2,176,019 30,446 25,628 46,297 24,980 53,027 24,569 56,789 24,162 57,606 23,725 55,614 Total Assets $ 2,217,420 $2,446,188 $2,605,242 $2,760,465 $2,988,334 Liabilities and Shareholders’ Equity Noninterest-Bearing Deposits Interest-Bearing Checking and Savings Deposits Time Deposits Total Deposits Short-Term Borrowings Federal Home Loan Bank Term Advances Other Long-Term Debt Other Liabilities $ 300,786 $ 358,751 $ 387,280 $ 441,945 $ 472,768 1,396,319 1,481,855 1,529,953 1,601,888 1,608,829 205,843 189,817 199,313 201,283 263,987 1,902,948 2,030,423 2,116,546 2,245,116 2,345,584 60,421 105,173 158,836 169,966 288,659 10,000 20,000 23,125 55,000 20,000 21,621 55,000 20,000 22,008 55,000 20,000 20,780 45,000 20,000 19,507 Total Liabilities 2,016,494 2,232,217 2,372,390 2,510,862 2,718,750 Total Shareholders’ Equity 200,926 213,971 232,852 249,603 269,584 Total Liabilities and Shareholders’ Equity $ 2,217,420 $2,446,188 $2,605,242 $2,760,465 $2,988,334 Total Return Performance Comparison of Five-Year Cumulative Total Return • Assumes Initial Investment of $100 Arrow Financial Corporation NASDAQ Banks Index Russell 2000 Index Zacks $1B-$5B Bank Assets Index 2013 100.00 100.00 100.00 100.00 2014 109.59 105.08 104.89 108.03 2015 114.57 114.45 100.26 116.76 2016 181.56 154.96 121.63 161.47 2017 161.42 165.08 139.44 174.08 2018 161.33 137.07 124.09 153.75 Comparison of 15-Year Cumulative Total Return • Assumes Initial Investment of $100 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Arrow Financial Corporation NASDAQ Banks Index Russell 2000 Index 100.00 118.58 106.58 108.20 101.28 123.94 132.30 156.43 143.40 162.12 182.92 200.46 209.58 332.12 295.27 295.11 100.00 114.52 111.86 125.60 99.40 72.47 60.30 71.71 64.14 76.73 109.82 115.40 125.69 170.18 181.29 150.53 100.00 118.44 123.78 146.52 144.22 95.49 121.43 154.03 147.60 171.73 238.39 250.05 239.02 289.96 332.44 295.83 Zacks $1B-$5B Bank Assets Index 100.00 116.74 114.01 127.88 107.38 87.68 75.27 85.54 83.73 98.75 128.58 138.91 150.13 207.62 223.83 197.70 Source: Prepared by Zacks Investment Research, Inc. Used with permission. All rights reserved. Copyright 1980–2019. Arrow Financial Corporation Board of Directors Thomas L. Hoy (Chairman) Retired President and CEO Arrow/Glens Falls National Bank David G. Kruczlnicki Retired President and CEO Glens Falls Hospital Mark L. Behan President Behan Communications, Inc. Elizabeth A. Miller President and CEO Miller Mechanical Services, Inc. Tenée R. Casaccio, AIA President JMZ Architects and Planners, P.C. Thomas J. Murphy President and CEO Arrow/Glens Falls National Bank Raymond F. O’Conor Chairman and Retired President and CEO Saratoga National Bank William L. Owens, Esq. Partner Stafford, Owens, Piller, Murnane, Kelleher & Trombley, PLLC Colin L. Read, PhD Mayor, City of Plattsburgh Professor of Economics and Finance SUNY Plattsburgh Richard J. Reisman, DMD Chairman - Section of Dentistry Glens Falls Hospital Michael B. Clarke Retired President and CEO Lone Star Industries Gary C. Dake President Stewart’s Shops Corp. Director Emeriti Herbert O. Carpenter John J. Carusone, Jr. Mary-Elizabeth T. FitzGerald Corporate Officers Thomas J. Murphy President and CEO Herbert A. Heineman, Jr. David L. Moynehan Elizabeth O’Connor Little Michael F. Massiano (Chairman Emeritus) John J. Murphy Doris E. Ornstein David S. DeMarco Senior Vice President and Chief Banking Officer Andrew J. Wise Senior Vice President and Chief Operating Officer Edward J. Campanella Senior Vice President, Treasurer and Chief Financial Officer David D. Kaiser Senior Vice President Shareholder Information Arrow Stock Arrow’s common stock trades on the NASDAQ Global Select MarketSM under the symbol “AROW.” Dividend Reinvestment Plan The Arrow Financial Corporation Dividend Reinvestment Plan offers participants a convenient and economical way to acquire common stock of Arrow Financial Corporation without payment of any brokerage commission or service charge. Participants may reinvest all cash dividends in additional shares as well as make optional cash contributions to buy shares. Since the Plan is entirely voluntary, you may join at any time and terminate whenever you wish. For more information, please contact: American Stock Transfer & Trust Company 6201 15th Avenue Brooklyn, NY 11219 Tel: (888) 444-0058 or astfinancial.com Our Family of Companies 250 Glen Street, PO Box 307, Glens Falls, NY 12801 (518) 745-1000 | arrowfinancial.com
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