UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT PURSUANT

TO SECTION 13 OR 15(D) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (date of earliest event reported):  April 22, 2024

TrustCo Bank Corp NY

(Exact name of registrant as specified in its charter)

5 SARNOWSKI DRIVE, GLENVILLE, NEW YORK 12302

(Address of principal executive offices)

(518) 377-3311

(Registrant’s Telephone Number,

Including Area Code)

NOT APPLICABLE

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

---

TrustCo Bank Corp NY

On April 22, 2024 TrustCo Bank Corp NY (“TrustCo”) issued a press release with results for the quarter ending March 31, 2024. Attached is a copy of the press release labeled as Exhibit 99(a).

Item 9.01.

Financial Statements and Exhibits

 

 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

---

News Release

5 Sarnowski Drive, Glenville, New York, 12302

Subsidiary:

Trustco Bank

Nasdaq -- TRST

Contact:

Robert Leonard

Executive Vice President

(518) 381-3693

FOR IMMEDIATE RELEASE:

Loans Reach Another All-Time High, Credit Quality Remains Solid;

TrustCo Reports Net Income of $12.1 Million and Capital Up 3%

Executive Snapshot:

Glenville, New York – April 22, 2024

TrustCo Bank Corp NY (TrustCo, NASDAQ: TRST) today announced first quarter 2024 net income of $12.1 million or $0.64 diluted earnings per share, compared to net income of $17.7 million or $0.93 diluted earnings per share for the first quarter 2023. Average loan growth increased 5.2% or $249.4 million for the first quarter 2024 over the same period in 2023.

Overview

Chairman, President, and CEO, Robert J. McCormick said “Trustco Bank is known for its top-tier residential mortgage products and our customers, both existing and new, drove residential loan production up 3% compared to the first quarter of 2023. Commercial loans also grew, besting last year’s first quarter by 13%, for an increase in total loans of 4%.  Non-interest income and capital ratios are both up during the same period, and our team held the line on deposit run-off generating modest growth there as well.  Non-performing loans are steady and charge-offs resulted in a net recovery this quarter, consistent with our commitment to excellent credit quality.  All in all, we believe that we are well positioned for the year ahead.”

Details

Average loans were up $249.4 million or 5.2% in the first quarter 2024 over the same period in 2023.  Average residential loans, our primary lending focus, were up $146.6 million, or 3.5%, in the first quarter 2024 over the same period in 2023.  Average commercial loans and home equity lines of credit also increased $38.3 million, or 16.0%, and $61.7 million, or 21.2%, respectively, in the first quarter 2024 over the same period in 2023.  Average deposits were up $141.6 million or 2.74% for the first quarter 2024 over the same period a year earlier. We believe the increase in time deposits continues to reflect the desire of customers to have additional funds in the safety and security offered by TrustCo’s long history of conservative banking. As we move forward, the objective is to encourage customers to retain these additional funds in the expanded product offerings of the Bank through aggressive marketing and product differentiation.

Net interest income was $36.6 million for the first quarter 2024, a decrease of $2.0 million, or 5.3%, compared to the prior quarter, driven by a higher cost of deposits, partially offset by loan growth at higher interest rates.  The net interest margin for the first quarter 2024 was 2.44%, down 16 basis points from 2.60% in the fourth quarter of 2023.  The yield on interest earnings assets increased to 3.99%, up 6 basis points from 3.93% in the fourth quarter of 2023.  The cost of interest bearing liabilities increased to 1.99% in the first quarter 2024 from 1.72% in the fourth quarter 2023.  The Bank has seen the erosion of margin begin to slow when comparing the decrease to prior quarters and we are optimistic that we are nearing the bottom of this rate cycle.  The Federal Reserve’s decision regarding whether to cut or hold rates in the upcoming meetings will have an effect on our ability to decrease deposit costs which should help margin in future quarters.  During the first quarter of 2024 we have been able to lower the rates offered on our time deposits while continuing to retain and grow that product.  This should bring down the cost of time deposits over time.  Non-interest expense decreased $3.9 million over the prior quarter primarily as a result of lower salaries and employee benefits costs in the current quarter and a litigation settlement in the prior quarter.

Asset quality remains strong and has been consistent over the past twelve months.  The Company recorded a provision for credit losses of $600 thousand in the first quarter of 2024, which is the result of a provision for credit losses on loans of $600 thousand, and there was no change in unfunded commitments.  The ratio of allowance for credit losses on loans to total loans was 0.98% and 0.97% as of March 31, 2024 and 2023, respectively.  The allowance for credit losses on loans was $49.2 million at March 31, 2024, compared to $46.7 million at March 31, 2023.  NPLs were $18.3 million at March 31, 2024, compared to $19.2 million at March 31, 2023.  NPLs were 0.37% and 0.40% of total loans at March 31, 2024 and 2023, respectively.  The coverage ratio, or allowance for credit losses on loans to NPLs, was 269.3% at March 31, 2024, compared to 243.6% at March 31, 2023.  NPAs were $20.6 million at March 31, 2024, compared to $21.0 million at March 31, 2023.

At March 31, 2024, our equity to asset ratio was 10.51%, compared to 10.17% at March 31, 2023.  Book value per share at March 31, 2024 was $34.12, up 5.6% compared to $32.31 a year earlier.

 

 

About TrustCo Bank Corp NY

TrustCo Bank Corp NY is a $6.2 billion savings and loan holding company and through its subsidiary, Trustco Bank, operated 140 offices in New York, New Jersey, Vermont, Massachusetts, and Florida at March 31, 2024.

In addition, the Bank’s Wealth Management Department offers a full range of investment services, retirement planning and trust and estate administration services.  The common shares of TrustCo are traded on the NASDAQ Global Select Market under the symbol TRST.

Forward-Looking Statements

All statements in this news release that are not historical are forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995.  Forward-looking statements can be identified by words such as "anticipate," "intend," "plan," "goal," "seek," "believe," "project," "estimate," "expect," "strategy," "future," "likely," "may," "should," "will" and similar references to future development, results or periods. Examples of forward-looking statements include, among others, statements we make regarding our expectations for our future performance, including our expectations regarding the effects of the economic environment on our financial results, our ability to retain customers and the amount of customers’ business, including deposit balances, with us, the impact of the Federal Reserve’s actions regarding interest rates, the growth of loans and deposits throughout our branch network, and our ability to capitalize on economic changes in the areas in which we operate.  Forward-looking statements are based on management’s current expectations as well as certain assumptions and estimates made by, and information available to, management at the time the statements are made. Such forward-looking statements are subject to factors and uncertainties that could cause actual results to differ materially for TrustCo from the views, beliefs and projections expressed in such statements, and many of the risks and uncertainties are heightened by or may, in the future, be heightened by volatility in financial markets and macroeconomic or geopolitical concerns related to inflation, continued elevated interest rates and ongoing armed conflicts (including the Russia/Ukraine conflict and the conflict in Israel and surrounding areas). TrustCo wishes to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The following important factors, among others, in some cases have affected and in the future could affect TrustCo’s actual results and could cause TrustCo’s actual financial performance to differ materially from that expressed in any forward-looking statement:  future changes in interest rates; ongoing inflationary pressures and continued elevated prices; exposure to credit risk in our lending activities; our increasing commercial loan portfolio; the sufficiency of our allowance for credit losses on loans to cover actual loan losses; our ability to meet the cash flow requirements of our depositors or borrowers or meet our operating cash needs to fund corporate expansion and other activities; claims and litigation pertaining to fiduciary responsibility and lender liability; our dependency upon the services of the management team; our disclosure controls and procedures’ ability to prevent or detect errors or acts of fraud; the adequacy of our business continuity and disaster recovery plans; the effectiveness of our risk management framework; the impact of any expansion by us into new lines of business or new products and services; the impact of severe weather events and climate change on us and the communities we serve, including societal responses to climate change; increasing scrutiny and evolving expectations from customers, regulators, investors, and other stakeholders with respect to our environmental, social and governance practices; the chance of a prolonged economic downturn, especially one affecting our geographic market area; instability in global economic conditions and geopolitical matters, as well as volatility in financial markets; the soundness of other financial institutions; U.S. government shutdowns, credit rating downgrades, or failure to increase the debt ceiling; fluctuations in the trust wealth management fees we receive as a result of investment performance; the impact of regulatory capital rules on our growth; changes in laws and regulations, including changes in cybersecurity or privacy regulations; restrictions on data collection and use; our compliance with the USA PATRIOT Act, Bank Secrecy Act, and other laws and regulations that could result in material fines or sanctions; changes in tax laws; limitations on our ability to pay dividends; TrustCo Realty Corp.’s ability to qualify as a real estate investment trust; changes in accounting standards; competition within our market areas; consumers and businesses’ use of non-banks to complete financial transactions; our reliance on third-party service providers; the impact of data breaches and cyber-attacks; the impact of a failure in or breach of our operational or security systems or infrastructure, or those of third parties; the impact of an unauthorized disclosure of sensitive or confidential client or customer information; the impact of interruptions in the effective operation of our computer systems; the impact of anti-takeover provisions in our organizational documents; the impact of the manner in which we allocate capital; and other risks and uncertainties under the heading “Risk Factors” in our most recent annual report on Form 10-K and, if any, in our subsequent quarterly reports on Form 10-Q or other securities filings. The forward-looking statements contained in this news release represent TrustCo management’s judgment as of the date of this news release. TrustCo disclaims, however, any intent or obligation to update forward-looking statements, either as a result of future developments, new information or otherwise, except as may be required by law.

TRUSTCO BANK CORP NY

GLENVILLE, NY

FINANCIAL HIGHLIGHTS

(dollars in thousands, except per share data)

(Unaudited)

(1)	Non-GAAP measure; calculated as noninterest expense (excluding ORE income/expense, branch closure expenses, and non-recurring expenses) divided by taxable equivalent net interest income plus noninterest income (excluding non-recurring loss).See Non-GAAP Financial Measures Reconciliation.

(2)	Non-GAAP measure; calculated as total shareholders' equity less $553 of intangible assets divided by total assets less $553 of intangible assets.  See Non-GAAP Financial Measures Reconciliation.

(3)	Calculated as allowance for credit losses on loans divided by total nonperforming loans.

CONSOLIDATED STATEMENTS OF INCOME

(dollars in thousands, except per share data)

(Unaudited)

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(dollars in thousands)

(Unaudited)

NONPERFORMING ASSETS

(dollars in thousands)

(Unaudited)

(1)	At period-end

(2)	For the three-month period ended

DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY -

INTEREST RATES AND INTEREST DIFFERENTIAL

(dollars in thousands)

(Unaudited)