Tompkins Financial Corporation Reports Strong Third Quarter 2025 Results, Highlighting Growth and Operational Strength
Tompkins Financial Corporation (NYSE American: TMP) has reported robust financial results for the third quarter of 2025, reflecting continued growth across its key business lines and strong performance metrics. The company achieved diluted earnings per share of $1.65 for the quarter, marking a 10.0% increase from the $1.50 reported in the second quarter of 2025, and a significant 26.9% rise compared to the $1.30 recorded in the third quarter of 2024. Net income for the quarter reached $23.7 million, representing a $2.2 million, or 10.3%, improvement from the prior quarter and a $5.0 million, or 27.0%, increase over the same period last year.
For the nine months ended September 30, 2025, Tompkins reported year-to-date diluted earnings per share of $4.52, up 25.9% from $3.59 in the same period of 2024. Net income for the year-to-date period reached $64.8 million, an increase of $13.6 million, or 26.6%, over the $51.2 million reported during the first nine months of the prior year.
Tompkins President and CEO, Stephen Romaine, commented on the results, stating, “Our third quarter financial results highlight the strength of our team and our balance sheet. Net income increased 27.0% compared to the same period last year, driven by continued net interest margin expansion and growth in both loans and deposits. We achieved a 7% increase in loans and deposits, reflecting solid demand from our commercial and consumer clients. Our improved earnings demonstrate the effectiveness of our ongoing investments in the business, as we have strategically increased resources to support growth and enhance customer experience. We remain well-positioned to continue building quality relationships, supporting local communities, and delivering sustainable results.”
Key Highlights from the Third Quarter
Net Interest Margin and Income:
Tompkins achieved a net interest margin (NIM) of 3.20% for the third quarter of 2025, up 12 basis points from 3.08% in the second quarter of 2025, and up 41 basis points from 2.79% in the third quarter of 2024. This improvement was driven by higher yields on interest-earning assets and continued growth in average loan balances, alongside effective management of funding costs.
Net interest income for the quarter totaled $63.9 million, up $3.7 million, or 6.2%, from the second quarter, and up $10.7 million, or 20.1%, year-over-year. For the nine months ended September 30, 2025, net interest income was $180.7 million, a 16.7% increase from the same period in 2024. Average loans grew to $6.2 billion, an increase of $86.8 million, or 1.4%, from the prior quarter, and up $385.5 million, or 6.6%, year-over-year. The loan growth was primarily concentrated in commercial real estate and commercial and industrial portfolios, reflecting strong demand from business clients across Tompkins’ markets.
Average total deposits for the quarter were $6.8 billion, up $116.7 million, or 1.7%, from the second quarter, and $481.8 million, or 7.6%, from the third quarter of 2024. The cost of interest-bearing deposits slightly increased to 2.26% from 2.24% in the prior quarter but remained lower than 2.35% in the third quarter of 2024. Noninterest-bearing deposits remained stable, representing 27.6% of total deposits, demonstrating continued strong liquidity support for the company’s lending activities.
Loan and Deposit Growth:
Tompkins’ total loans at September 30, 2025, were $6.2 billion, up $115.4 million, or 1.9%, compared to June 30, 2025, translating to a 7.5% annualized growth rate. Compared to September 30, 2024, total loans increased $406.8 million, or 6.9%. Total deposits at the end of the quarter stood at $7.1 billion, reflecting an increase of $337.3 million, or 5.0%, from the prior quarter, and $475.2 million, or 7.2%, year-over-year. The company’s loan-to-deposit ratio was 89.2%, demonstrating a well-balanced liquidity position.
Noninterest Income and Expense:
Noninterest income for the quarter totaled $23.6 million, an increase of $179,000, or 0.8%, compared to the third quarter of 2024. This growth was primarily driven by gains on the sale of loans, which increased 52.2% year-over-year, partially offset by a modest decline in card services income. Year-to-date noninterest income reached $71.1 million, a 5.7% increase from the prior year, reflecting higher other income, including a $1.9 million gain on the sale of other real estate owned and a 6.1% increase in insurance commissions and fees. Wealth management fees also contributed positively, rising 2.4% year-to-date.
Noninterest expenses for the quarter were $53.8 million, up 8.0% from the same period in 2024, reflecting strategic investments in personnel and other operating costs. Year-to-date noninterest expense was $156.1 million, up 4.3% from $149.7 million in 2024. Increases were driven by higher personnel-related costs, which rose 5.4% for the quarter and 5.0% year-to-date, and increased other operating expenses, up 16.2% for the quarter, reflecting the company’s commitment to supporting future growth initiatives.
Provision for Credit Losses and Asset Quality:
Tompkins’ provision for credit losses for the third quarter was $2.5 million, modestly higher than $2.2 million in the same period last year, reflecting an increase in loan exposure and updated economic assumptions. Year-to-date provision for credit losses was $10.6 million, compared to $5.2 million for the same period in 2024, primarily impacted by a $4.7 million charge-off in the second quarter of 2025 related to a commercial real estate relationship.
Nonperforming assets declined to $53.0 million, or 0.63% of total assets, down from $62.7 million, or 0.78%, in the third quarter of 2024. The allowance for credit losses remained stable at 0.95% of total loans and leases, ensuring a strong buffer against potential credit risks. Special Mention and Substandard loans totaled $144.2 million at quarter-end, reflecting two loans totaling $41.2 million that were downgraded, though Tompkins believes existing collateral is sufficient to mitigate risk.
Capital and Liquidity Position:
Tompkins Financial maintained a strong capital position throughout the quarter. The ratio of total capital to risk-weighted assets was 13.27%, and the Tier 1 capital to average assets ratio was 9.41%, both well above regulatory requirements for well-capitalized institutions. The company’s liquidity position remained stable, with access to national and regional wholesale funding sources, including Federal funds, repurchase agreements, brokered deposits, and Federal Reserve and Federal Home Loan Bank advances. Total liquidity available at September 30, 2025, was $1.5 billion, representing 17.8% of total assets, providing significant flexibility to support ongoing lending and growth initiatives.
Outlook and Strategic Focus:
The third quarter results underscore Tompkins’ strategic focus on growth, profitability, and community support. The company’s performance reflects both strong core banking operations and disciplined investment in personnel and infrastructure. Management highlighted that continued expansion in net interest margin, coupled with strategic loan and deposit growth, positions Tompkins well to maintain financial strength and deliver value to shareholders.
CEO Stephen Romaine emphasized the company’s commitment to building long-term relationships with customers and communities, stating, “Our team’s dedication and disciplined approach have resulted in significant growth across all key metrics. We continue to invest in the business to support sustainable expansion while ensuring that our balance sheet remains strong and resilient. Looking forward, we remain focused on delivering quality service, prudent financial management, and meaningful impact within the communities we serve.”
In summary, Tompkins Financial Corporation’s third quarter 2025 results reflect strong earnings growth, expansion in net interest margin, solid loan and deposit growth, disciplined expense management, and sound capital and liquidity positions. The company continues to demonstrate its resilience and commitment to long-term value creation for shareholders while supporting local communities through responsible banking practices.
