Financial Institutions, Inc. reported a net income of $20.5 million for the third quarter of 2025, a significant increase from $13.5 million in the same period last year. This translates to earnings of $0.99 per diluted share, compared to $0.84 per diluted share in the prior year. The company's net interest income rose to $51.8 million, up from $40.7 million, driven by a higher net interest margin of 3.65%, compared to 2.89% in the previous year. The increase in net interest income was attributed to lower interest-bearing liability costs and a rise in the average yield on investment securities, following a restructuring of the available-for-sale securities portfolio in December 2024.
Total assets for Financial Institutions, Inc. reached $6.29 billion as of September 30, 2025, marking an increase from $6.12 billion at the end of 2024. The company's loan portfolio also grew, totaling $4.59 billion, an increase of $111.2 million from the previous year. The composition of loans included a rise in commercial business loans, which increased by 11% to $740.6 million, and commercial mortgage loans, which accounted for 49% of total loans. The company’s deposits increased by $253.1 million to $5.36 billion, primarily due to growth in public, brokered, and reciprocal deposits.
In terms of operational developments, the company has been winding down its Banking-as-a-Service (BaaS) offerings, which it announced in September 2024. As of September 30, 2025, the majority of BaaS-related deposits had exited the balance sheet, with expectations for the remaining balance to flow out in early 2026. Additionally, the company completed the sale of its insurance subsidiary, SDN Insurance Agency, in April 2024, generating $27 million in proceeds and a pre-tax gain of $13.7 million.
Looking ahead, Financial Institutions, Inc. remains focused on expanding its market share and exploring acquisition opportunities that align with its core competencies. The company’s capital position is strong, with a Tier 1 Capital Ratio of 11.48% and a Total Risk-Based Capital Ratio of 13.60% as of September 30, 2025, both exceeding regulatory requirements. The management is committed to maintaining a community bank philosophy, emphasizing personalized service and customer relationships, while also leveraging digital capabilities to enhance customer engagement and operational efficiency.
About FINANCIAL INSTITUTIONS INC
Financial Institutions, Inc. is a community-focused financial holding company operating through its subsidiaries, including Five Star Bank and Courier Capital. It provides banking services, commercial and consumer loans, wealth management, and investment advisory services primarily in New York and surrounding regions. The company emphasizes personalized customer relationships, community engagement, and diversified financial products, leveraging digital channels and strategic growth to serve small to medium-sized businesses, individuals, and municipalities.
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