The rundown of area banks offering pay raises, bonuses after tax law

Banks that serve Central New York are among many across the country that have announced bonuses, pay raises, and other employee perks in the wake of tax cuts passed by Congress and signed by President Donald Trump in December.

The Tax Cut and Jobs Act reduced the top federal corporate tax rate from 35 percent to 21 percent. That triggered a tsunami of public companies announcing raises and bonuses for employees.

More than 280 companies announced raises, bonuses, increased 401(k) contributions, or, in the case of utilities, rate cuts, following the passage of the legislation, according to Americans for Tax Reform. The Washington, D.C.–based lobbying group said some 3 million American workers are affected by the changes.

Some banks announced their moves in separate statements while others made the news part of their quarterly earnings reports. Many banks noted that the new tax law was costing them money in the short term because the value of certain deferred assets dropped due to the lower tax rates.

“Fourth quarter results were negatively impacted by the newly enacted tax legislation, but a lower corporate tax rate in the future should provide many benefits to M&T,” said Darren J. King, M&T Bank’s executive VP and chief financial officer.

Details of bank pay raises

Several banks headquartered in upstate New York announced their plans to raise pay or offer other employee perks due to the cut in the corporate tax rate.

M&T Bank (NYSE: MTB), which is headquartered in Buffalo and ranks number one in deposit market share in the 16-county Central New York area, said it’s raising wages for hourly paid employees to a range of $14 to $16 per hour. M&T said that the move represented “an investment in employees of $25 million, once fully implemented.” Employees will also be paid for 40 hours of volunteer or employee resource-group activities. Additionally, the bank contributed 

$50 million to the M&T Charitable Trust in 2017, up from the average annual donation for the past decade of $18 million.

Cleveland–headquartered KeyCorp (NYSE: KEY), parent of Key Bank, said it will be increasing its minimum wage and increasing its contributions to employees’ retirement accounts. KeyBank ranks second in deposit market share in the 16-county Central New York region.

NBT Bancorp (NASDAQ: NBTB), based in Norwich and the number three bank in deposit market share in Central New York, is increasing starting hourly pay to $15. Also, employees earning less than $50,000 a year will receive permanent raises of 5 percent. That will affect more than 60 percent of bank employees, NBT said.

Tompkins Financial Corp. (NYSE: TMP), the parent of Tompkins Trust Company, headquartered in Ithaca, announced that it is raising its profit sharing to employees to 9 percent of employee annual pay. “We also plan to raise the minimum wage paid by our company to $14 to $15 per hour based on geography and we are committed to increasing compensation for all employees earning less than $18 per hour,” the bank said. It added that the wage hikes will cost more than $1 million.

In addition, Tompkins Financial said it would leverage the benefits of the tax cuts by spending on improvements. “This includes planned investments to modernize our facilities, improve customer-facing technology and expand staff in support of these initiatives.”

New York City–based banks with operations in Central New York also announced pay increases.

JPMorgan Chase (NYSE: JPM) announced a five-year investment that it credited to its current strength and the tax changes, as well as “a more constructive regulatory and business environment.” The changes included raises that will average 10 percent for 22,000 employees and upping community-based philanthropic investments by 40 percent to $1.75 billion over five years.

Bank of America (NYSE: BAC) paid $1,000 bonuses to 145,000 employees following the passage of the tax changes. “We also shared our success with stakeholders through our high level of funding philanthropic initiatives,” CEO Brian Moynihan said in a news release.

Two New England–based banks with branches in Central New York also announced plans to share the benefits of the tax-law changes with employees.

Citizens Bank — a unit of Citizens Financial Group (NYSE: CFG) headquartered in Providence, Rhode Island — said it would pay one-time $1,000 bonuses to 12,500 employees earning below a certain level. It said 70 percent of workers would be affected. The bank also announced a $10 million contribution to its charitable foundation.

Berkshire Bank — a unit of Berkshire Hills Bancorp (NASDAQ: BHLB), headquartered in Massachusetts — announced it is raising its minimum wage to $15 an hour and paying a one-time $1,000 bonus to more than 1,000 employees, in addition to the $500 holiday bonus workers received. The bank is also contributing $2 million to its charitable foundation.          

Banks that serve Central New York are among many across the country that have announced bonuses, pay raises, and other employee perks in the wake of tax cuts passed by Congress and signed by President Donald Trump in December.

The Tax Cut and Jobs Act reduced the top federal corporate tax rate from 35 percent to 21 percent. That triggered a tsunami of public companies announcing raises and bonuses for employees.

More than 280 companies announced raises, bonuses, increased 401(k) contributions, or, in the case of utilities, rate cuts, following the passage of the legislation, according to Americans for Tax Reform. The Washington, D.C.–based lobbying group said some 3 million American workers are affected by the changes.

Some banks announced their moves in separate statements while others made the news part of their quarterly earnings reports. Many banks noted that the new tax law was costing them money in the short term because the value of certain deferred assets dropped due to the lower tax rates.

“Fourth quarter results were negatively impacted by the newly enacted tax legislation, but a lower corporate tax rate in the future should provide many benefits to M&T,” said Darren J. King, M&T Bank’s executive VP and chief financial officer.

Details of bank pay raises

Several banks headquartered in upstate New York announced their plans to raise pay or offer other employee perks due to the cut in the corporate tax rate.

M&T Bank (NYSE: MTB), which is headquartered in Buffalo and ranks number one in deposit market share in the 16-county Central New York area, said it’s raising wages for hourly paid employees to a range of $14 to $16 per hour. M&T said that the move represented “an investment in employees of $25 million, once fully implemented.” Employees will also be paid for 40 hours of volunteer or employee resource-group activities. Additionally, the bank contributed 

$50 million to the M&T Charitable Trust in 2017, up from the average annual donation for the past decade of $18 million.

Cleveland–headquartered KeyCorp (NYSE: KEY), parent of Key Bank, said it will be increasing its minimum wage and increasing its contributions to employees’ retirement accounts. KeyBank ranks second in deposit market share in the 16-county Central New York region.

NBT Bancorp (NASDAQ: NBTB), based in Norwich and the number three bank in deposit market share in Central New York, is increasing starting hourly pay to $15. Also, employees earning less than $50,000 a year will receive permanent raises of 5 percent. That will affect more than 60 percent of bank employees, NBT said.

Tompkins Financial Corp. (NYSE: TMP), the parent of Tompkins Trust Company, headquartered in Ithaca, announced that it is raising its profit sharing to employees to 9 percent of employee annual pay. “We also plan to raise the minimum wage paid by our company to $14 to $15 per hour based on geography and we are committed to increasing compensation for all employees earning less than $18 per hour,” the bank said. It added that the wage hikes will cost more than $1 million.

In addition, Tompkins Financial said it would leverage the benefits of the tax cuts by spending on improvements. “This includes planned investments to modernize our facilities, improve customer-facing technology and expand staff in support of these initiatives.”

New York City–based banks with operations in Central New York also announced pay increases.

JPMorgan Chase (NYSE: JPM) announced a five-year investment that it credited to its current strength and the tax changes, as well as “a more constructive regulatory and business environment.” The changes included raises that will average 10 percent for 22,000 employees and upping community-based philanthropic investments by 40 percent to $1.75 billion over five years.

Bank of America (NYSE: BAC) paid $1,000 bonuses to 145,000 employees following the passage of the tax changes. “We also shared our success with stakeholders through our high level of funding philanthropic initiatives,” CEO Brian Moynihan said in a news release.

Two New England–based banks with branches in Central New York also announced plans to share the benefits of the tax-law changes with employees.

Citizens Bank — a unit of Citizens Financial Group (NYSE: CFG) headquartered in Providence, Rhode Island — said it would pay one-time $1,000 bonuses to 12,500 employees earning below a certain level. It said 70 percent of workers would be affected. The bank also announced a $10 million contribution to its charitable foundation.

Berkshire Bank — a unit of Berkshire Hills Bancorp (NASDAQ: BHLB), headquartered in Massachusetts — announced it is raising its minimum wage to $15 an hour and paying a one-time $1,000 bonus to more than 1,000 employees, in addition to the $500 holiday bonus workers received. The bank is also contributing $2 million to its charitable foundation.