DeWITT — Community Bank System, Inc. (NYSE: CBU) reported that its net income rose more than 29 percent to $35.2 million, or 68 cents a share, in the third quarter from $27.2 million, or 61 cents, in the year-ago period. 

Its earnings per share, adjusted for one-time gains and expenses, was 73 cents a share. That beat analysts’ expectation for 67 cents, according to Zacks Investment Research.

Community Bank reported its earnings before the open of trading on Oct. 23. Its share price fell by $1.99, or more than 3.5 percent, that day to close at $53.75. Year to date, Community Bank’s stock price was down 13 percent, through Oct. 23. The stock had a huge 2016, however, gaining nearly 55 percent.

The DeWitt–based banking company generated total revenue of $137.3 million in the third quarter, up almost 27 percent over the prior-year quarter. That included a full quarter of revenue from both the Merchants Bancshares, Inc. and Northeast Retirement Services, Inc. (NRS) acquisitions that Community Bank completed in the first half of this year. 

Revenue was boosted by a 23 percent increase in average earning assets and continued growth in noninterest income, partially offset by a three basis-point decline in the net interest margin from the prior-year quarter, the earnings report stated. 

Community Bank’s third quarter net interest income totaled $84.4 million, up nearly $16 million, or more than 23 percent, compared to the third quarter of 2016.

A combination of acquired and organic growth resulted in a $10.6 million, or 48 percent, increase in wealth management, insurance, and employee-benefit services revenue. Deposit-service fees increased 24 percent year-over-year, primarily the result of the addition of Merchants, as well as increased card-related revenue, Community Bank said.

“We realized another record performance reflecting full third quarter contributions from our NRS acquisition completed in February, and from our Merchants Bancshares merger which closed in May,” Mark E. Tryniski, president and CEO of Community Bank System, said in the earnings report. “Both of these high-value transactions have performed above our initial expectations. NRS continued to grow both its top and bottom line performance at a double-digit pace, and the Merchants integration has proceeded smoothly with cost synergies running ahead of plan. Our accelerated operating performance, reflects improvements in expense management, credit quality and growth in non-interest income, all of which contributed to the 13% increase in per share results (excluding acquisition expenses) compared with the third quarter of 2016. We are well positioned to continue delivering a high level of operating performance for the benefit of our shareholders.”

Community Bank acquired Merchants for about $345 million in stock and cash and purchased NRS for about $149 million in stock and cash.

During the third quarter, Community Bank boosted its quarterly cash dividend to 34 cents per share on its common stock from 32 cents in the prior quarter and year-ago quarter. This increase marked the 25th consecutive year of dividend increases for Community Bank.

Community Bank System operates more than 230 branches across upstate New York, northeastern Pennsylvania, Vermont, and western Massachusetts through its banking subsidiary, Community Bank, N.A. With assets of about $10.8 billion, Community Bank is among the 150 largest financial institutions in the U.S.

SENNETT — Construction continues on Lyons National Bank’s new branch office in the town of Sennett, which will be the community bank’s second location in the Auburn area.

The 10,000-square-foot building at 311 Grant Ave. (Route 5), just outside the Auburn city line, will be completed in mid-December, Thomas Kime, president of Lyons National Bank (LNB), tells CNYBJ. It will be about two miles away from the bank’s first Auburn office at 63 Genesee St. 

Auburn is an attractive market for LNB. It is a $725 million marketplace, making Auburn the bank’s largest market outside of Monroe County, Robert Schick, chairman and CEO of LNB and its holding company Lyons Bancorp, Inc., said in a letter accompanying the bank’s 2016 annual report.

LNB’s first Auburn branch, which opened in late April, is a leased space downtown. It allowed the community bank to enter the market sooner than waiting on construction of a new building, but the space has limitations, Kime says. That branch does not have drive-thru lanes or a community room, both of which will be part of the Grant Avenue branch. 

“The Grant Avenue office gives us a facility that’s more in line with what we typically offer,” Kime says.

Eight to 10 employees will work at the new branch, including a full-time residential mortgage lender, a mortgage processor, an employee handling commercial loans, and a financial advisor, Kime says.

Bouley & Associates, a construction firm based in Auburn, is managing the project, which broke ground in July. Auburn–based firm Beardsley Architects & Engineers designed the two-story building. The space was previously home to a La-Z-Boy furniture store before LNB bought the property and demolished the building.

LNB paid $639,000 to buy the 1.13 acre property from Andrew R. Goldberg in a sale that closed on May 24, according to Cayuga County online property records. The previous building that LNB knocked down encompassed more than 23,500 square feet. The demolition was completed in early June, according to an LNB news release.

About the bank 

Lyons National Bank was founded in 1852 and is based in Lyons. Once the Sennett branch opens, the community bank will have 15 branches in Monroe, Wayne, Ontario, Yates, Seneca, Cayuga, and Onondaga counties. Its Onondaga County office is in Jordan.

Lyons Bancorp was formed in 1987 as a holding company for both the bank and Lyons Realty Associates Corp, a real-estate investment trust, according to the company’s website. Lyons Bancorp (OTC: LYBC) is publicly traded over-the-counter.

LNB has generated steady growth in the past 20 years, increasing loans, deposits, and its investment portfolio while gradually expanding its geographic market, according to Lyons Bancorp’s 2016 annual report. 

In 2016, the banking company generated nearly $7.6 million in net income, up 3 percent from almost $7.4 million in 2015, according to the report. Lyons Bancorp’s net income totaled $7.2 million in 2014, $7 million in 2013, and $6.2 million in 2012.

The banking company’s total assets have also steadily grown from $665 million in 2012 to $733 million in 2013, $807 million in 2014, $868 million in 2015, and $956 million last year.

LNB says it grows largely by capturing business from its rivals.

“Upstate New York is hardly a growth area, so most of our gains come at the expense of our competitors. Even when we expand our footprint by opening new branches, our growth in these de novo branches comes from other banks and financial services companies,” Schick said in the letter accompanying the report.

LNB will face no shortage of competitors near its newest branch. It has branch offices of AmeriCU Credit Union, KeyBank, Chemung Canal Trust, M&T Bank, and Generations Bank all located within walking distance of its new branch, along that busy stretch of Route 5.         

ENDWELL — Visions Federal Credit Union (FCU) on Oct. 1 began offering access to a team of Medicare advisors as a benefit to its members in Onondaga, Broome, Tioga, Chemung, and Chenango counties. 

“All they’re getting with the relationship here at Visions is our expertise and help in sitting down and reviewing their options and helping them make the right choice,” says Robert (Rob) Hennessy, insurance manager for Endwell–based Visions FCU.

Visions members aren’t getting a discount or “negotiated better plan options” under this benefit, he notes. Hennessy spoke with CNYBJ on Oct. 23.

He joined Visions at the end of July, but the discussions on offering the Medicare-consulting service started in 2016. Visions management had been thinking about what additional services the credit union could be offering its members “and the term Medicare has come up several times,” according to Hennessy.

Hennessy, along with two colleagues, is helping the Visions members who have questions about Medicare plans — such as Medicare Supplement, Medicare Advantage, and Part D drug coverage — and their eligibility.

“We’re appointed with Excellus [BlueCross BlueShield] to be able to not only consult with our members but be able to enroll them and help them make the decisions on their health-care needs for next year,” says Hennessy. Excellus is Central New York’s largest health insurer.

A Visions member can enroll in Medicare through Excellus, another insurance agent, or through Medicare.gov and select their own coverage.

“All we’re providing our members is education and assistance and helping sort all this out,” says Hennessy.

Visions is initially working with its New York members with their questions on Medicare but eventually wants to “branch out” the consulting services to members in Pennsylvania and in New Jersey.

Medicareful

In offering the consultation benefit, Visions is also working with Harrisburg, Pennsylvania–based Ritter Insurance Marketing on a website called Medicareful (medicareful.com). Ritter works with several credit unions nationwide, according to Hennessy.

“This is one of the niches they provide, Medicare assistance,” he adds.

He describes Medicareful as a custom-made Medicare portal on which Visions members can insert their ZIP codes, and the website generates all the plans for which the member is eligible based on the ZIP code. They can also set up appointments with Visions for questions about the various Medicare plans, says Hennessy.

Adding states

Visions also wants to provide the consulting service in Pennsylvania and New Jersey through the insurers Aetna and UnitedHealthcare, as well as with SilverScript Insurance Company, a CVS Health company. SilverScript describes itself as “one of America’s largest Medicare Part D insurers,” according to its website. 

The current focus is on Excellus and SilverScript for Visions’ New York members, according to Hennessy. As it works to offer the consultation service in New Jersey and Pennsylvania, Visions will again turn to Ritter for help. 

“They’re the broker that’s attaching us and helping us get appointed with these carriers. We process all the enrollments through Ritter and then Ritter submits them on to the carriers for us,” says Hennessy.

When asked how much it is costing Visions to offer the service, Hennessy said, “There is no cost.”

“Ritter is receiving compensation directly from the carriers that they work with, but we are paying no direct fees to either Excellus or Ritter for this arrangement,” he adds.

“Forgotten component”

Visions has a division focused on investment services, which includes a group of financial planners that consult with the credit union’s members.

“Medical insurance is a huge component, and it’s often a forgotten component, of that complete retirement-planning wheel,” says Hennessy.

He knows people focus on investments, mutual funds, and having money to spend, but asserts that not managing medical expenses properly “can put a drain” on your investment savings and your retirement savings.

Medicare consulting is “becoming more and more a trend” in the financial-services industry with banks and credit unions, Hennessy contends.

“This was born out of a member need and we’re doing this to help service the members,” he adds.