Financial Institutions, Inc. Reports Net Income Available to Common Shareholders of $19.6 million, or $0.99 per Diluted Share, for the Third Quarter of 2026

Q: What were Financial Institutions' earnings for the third quarter of 2026?

Financial Institutions earned $19.6 million available to common shareholders, or $0.99 per diluted share. Common-shareholder income declined 5.7% from the second quarter and 2.4% year over year. Diluted earnings compared with $1.04 sequentially and $0.99 a year earlier.

Q: What drove Financial Institutions' deposit growth in the third quarter of 2026?

Seasonally higher public deposits primarily drove sequential deposit growth, although all deposit types increased. Year-over-year growth reflected higher nonpublic, reciprocal and brokered deposits, partially offset by lower public deposits. Public deposits represented 22% of total deposits at September 30, 2026.

Q: What capital ratios did Financial Institutions report for the third quarter of 2026?

Financial Institutions reported a common equity Tier 1 ratio of 11.36% and a tangible common equity ratio of 8.40%. These measure capital relative to risk-weighted assets and tangible assets, respectively.

Loan and deposit growth accompanied lower fee income and higher operating expenses, leaving common-shareholder earnings below both comparison quarters.

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Rhea-AI Summary

Financial Institutions (NASDAQ: FISI) reported third-quarter 2026 net income available to common shareholders of $19.6 million, down from both comparison quarters. Diluted earnings were $0.99 per share, versus $1.04 in the second quarter and $0.99 a year earlier. Net interest income rose 4.8% year over year to $54.3 million. Tax-equivalent net interest margin was 3.70%, unchanged sequentially and up 5 basis points year over year.

At September 30, loans reached $4.86 billion, up 2.2% sequentially, while deposits increased 3.3% to $5.47 billion. Noninterest income fell 13.3% year over year to $10.5 million, while noninterest expense increased 2.6% to $36.8 million. The efficiency ratio worsened to 56.84% from 55.33% sequentially. During the quarter, the company repurchased 185,833 shares at an average price of $40.92.

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0 major · 17 points

How the balance works

Positive

Moderate pointNet interest income of $54.291 million rose 1.7% sequentially and 4.8% year over year.
Moderate pointLoans of $4.86 billion grew 2.2% sequentially and 5.8% year over year at September 30.
Moderate pointDeposits of $5.47 billion increased 3.3% sequentially and 2.2% year over year at September 30.
Minor pointTax-equivalent net interest margin of 3.70% held steady sequentially, rising 5 basis points year over year.
Minor pointCommercial loans of $3.306 billion increased 3.0% sequentially and 10.6% year over year.

6 minor points

Minor pointResidential real estate loans of $740.524 million grew 0.2% sequentially and 2.2% year over year.
Minor pointInvestment advisory income of $3.343 million rose 1.7% sequentially and 10.6% year over year.
Minor point185,833 shares repurchased during the quarter at an average price of $40.92.
Minor pointAverage earning assets of $5.84 billion increased $51.6 million sequentially and $180.7 million year over year.
Minor pointIncome tax expense of $4.057 million declined 8.2% sequentially and 14.8% year over year.
Minor pointNonperforming loans relative to total loans decreased by 3 basis points.

Negative

Moderate pointCommon-shareholder net income of $19.626 million fell 5.7% sequentially and 2.4% year over year.
Moderate pointNoninterest expense of $36.822 million increased 3.4% sequentially and 2.6% year over year.
Minor pointDiluted earnings of $0.99 per share declined 4.8% sequentially and remained unchanged year over year.
Minor pointReturn on average assets of 1.26% declined from 1.35% sequentially and 1.32% a year earlier.
Minor pointReturn on average equity of 12.32% declined from 13.31% in both comparison quarters.

12 minor points

Minor pointEfficiency ratio of 56.84% worsened from 55.33% sequentially and 56.78% a year earlier.
Minor pointLimited-partnership loss of $274 thousand compared with a $140 thousand sequential loss and $223 thousand year-earlier gain.
Minor pointDerivative income of $106 thousand declined 79.5% sequentially and 87.5% year over year.
Minor pointSecurities gains were zero, unchanged sequentially but below $703 thousand a year earlier.
Minor pointOther noninterest income of $1.239 million rose 3.3% sequentially but fell 22.4% year over year.
Minor pointConsumer loans of $809.802 million increased 0.7% sequentially but declined 7.6% year over year.
Minor pointShort-term borrowings of $167 million declined 8.2% sequentially but increased 203.6% year over year.
Minor pointLong-term borrowings of $78.768 million increased 0.1% sequentially but declined 31.5% year over year.
Minor pointUnencumbered securities of $6.853 million declined 77.1% sequentially and 88.3% year over year.
Minor pointFederal Home Loan Bank borrowing availability of $204.714 million rose 12.2% sequentially but fell 29.1% year over year.
Minor pointFederal Reserve excess cash of $37.629 million declined 4.9% sequentially and 61.2% year over year.
Minor pointQuarterly net charge-off ratio increased from both comparison quarters; the company said it remained within full-year guidance.

News Explained

As of September 30, 2026, Financial Institutions reported about $1.17 billion in available liquidity, excluding brokered-deposit capacity, plus $102.9 million in cash and cash equivalents and $155.0 million in available unsecured credit lines.

Key Figures

Net income available to common shareholders: $19,626 thousand Diluted earnings per share: $0.99 Net interest income: $54,291 thousand +5 more

Net income available to common shareholders: $19,626 thousand; Q3 2026; down 5.7% QoQ and 2.4% YoY
Diluted earnings per share: $0.99; Q3 2026; down from $1.04 QoQ and unchanged YoY
Net interest income: $54,291 thousand; Q3 2026; up 4.8% YoY
Net interest margin: 3.70%; Q3 2026; stable QoQ and up 5 basis points YoY
Total loan growth: 5.8% YoY; Loans totaled $4,855,827 thousand at September 30, 2026
Total deposit growth: 3.3% QoQ; Deposits totaled $5,474,936 thousand at September 30, 2026
Common shares repurchased: 185,833 shares at an average price of $40.92 per share; Q3 2026
Non-performing loans to total loans ratio: Decreased 3 basis points; Q3 2026

Historical Context

1 past event · Latest: Jul 23

1 event

Jul 23
Earnings report

24h Move

+4.9%

Reported $20.8 million in common income and $53.4 million in net interest income for Q2.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Key Terms

net interest margin, net charge-off ratio, common equity tier 1 ratio, equity method

4 terms

net interest margin financial

"net interest margin of 3.70% was stable with the linked quarter"

Net interest margin measures how much a bank earns from lending and investing compared with what it pays for funding, expressed as a percentage of its interest-earning assets. Think of it like a grocery store’s markup: it shows the gap between buying cost and selling price per dollar of goods — here, the cost is interest paid and the sale is interest received. Investors watch it because a higher margin usually means a bank is more profitable and better at managing interest rate and credit conditions.

net charge-off ratio financial

"our quarterly net charge-off ratio was up from lower-than-typical levels"

The net charge-off ratio measures the portion of a lender’s loans that were written off as uncollectible after subtracting any later recoveries, divided by the average loan balance over the same period and shown as a percentage. It tells investors how many loans are effectively going bad — like the share of rotten fruit in a basket — and helps assess a lender’s credit quality, potential future losses and pressure on profits and reserves.

common equity tier 1 ratio regulatory

"a common equity Tier 1 ratio of 11.36%"

The common equity tier 1 ratio is a measure of a bank's financial strength, showing how much high-quality core capital it has compared to its total risk-weighted assets. Think of it as a safety buffer or cushion that helps ensure the bank can withstand economic shocks. For investors, a higher ratio indicates a stronger, more resilient bank, making it a key indicator of its financial health.

equity method financial

"which we account for under the equity method"

An equity method investment is an accounting approach used when a company owns enough of another business to influence its decisions but not control it (commonly around 20–50% ownership). Instead of counting only dividends, the investor records its share of the other company’s profits and losses on its own income statement and adjusts the investment’s value on the balance sheet—like tracking a friend’s joint project by noting your share of their gains or setbacks. For investors, this matters because it can significantly affect reported earnings, asset values, and the apparent strength of a company’s financial results.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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10/29/2026 - 04:05 PM EDT

Quarterly results highlighted by loan growth of 2.2% and deposit growth of 3.3%

WARSAW, N.Y., Oct. 29, 2026 (GLOBE NEWSWIRE) -- Financial Institutions, Inc. (NASDAQ: FISI) (the "Company," "we" or "us") today reported financial and operational results for the third quarter ended September 30, 2026, reflecting strong performance by subsidiaries Five Star Bank (the "Bank") and Courier Capital, LLC ("Courier Capital"), including healthy loan and deposit growth and sustained profitability.

KEY FINANCIAL METRICS										Quarter-over-Quarter ("QoQ")						Year-over-Year ("YoY")
Dollars in thousands, except per share data Return metrics annualized	Q3 2026			Q2 2026			Q3 2025			Variance				%		Variance				%
Net income	$	19,990		$	21,184		$	20,477		$	(1,194	)		-5.6	%	$	(487	)		-2.4	%
Net income available to common shareholders		19,626			20,819			20,112			(1,193	)		-5.7	%		(486	)		-2.4	%
Diluted earnings per common share	$	0.99		$	1.04		$	0.99		$	(0.05	)		-4.8	%	$	-			0.0	%
Return on average assets		1.26	%		1.35	%		1.32	%		(9	)	bps				(6	)	bps
Return on average equity		12.32	%		13.31	%		13.31	%		(99	)	bps				(99	)	bps
Return on average tangible common equity ⁽¹⁾		13.75	%		14.88	%		14.98	%		(113	)	bps				(123	)	bps
Efficiency ratio		56.84	%		55.33	%		56.78	%		151		bps				6		bps
Total loans (end of period)	$	4,855,827		$	4,752,965		$	4,590,423		$	102,862			2.2	%	$	265,404			5.8	%
Total deposits (end of period)	$	5,474,936		$	5,299,465		$	5,357,809		$	175,471			3.3	%	$	117,127			2.2	%

Third Quarter 2026 Highlights and Key Developments

Total loans grew 2.2% from the end of the linked quarter and 5.8% from September 30, 2025, to reach $4.86 billion at September 30, 2026, driven by robust commercial lending.
Total deposits increased 3.3% quarter-over-quarter and 2.2% year-over-year to $5.47 billion at September 30, 2026. Growth was broad-based across all deposit categories, led by seasonal support in public deposits.
Net interest income reached a new quarterly high of $54.3 million and net interest margin of 3.70% was stable with the linked quarter and up 5 basis points from the year-ago quarter.
Investment advisory income, the Company's leading contributor of noninterest income, increased 1.7% and 10.6% from the linked and year-ago quarters, respectively.
The efficiency ratio remained below 57% for the quarter, reflecting the Company's focus on sustained profitability.
The Company's strong capital position enabled the repurchase of 185,833 shares of common stock at an average price of $40.92 per share during the quarter.

"Our third quarter results underscore the strength of our relationship-driven business model and our unwavering commitment to disciplined execution," said President and Chief Executive Officer Martin K. Birmingham. "Our commercial franchise continues to be the primary driver of loan growth and was supported by increases in consumer indirect and residential mortgage lending during the third quarter. While our quarterly net charge-off ratio was up from lower-than-typical levels in the linked and year-ago quarters, it remains within our full-year guidance. At the same time, the ratio of non-performing loans to total loans decreased by 3 basis points. Overall, we remain focused on credit-disciplined loan production in our core Upstate New York markets."

Chief Financial Officer and Treasurer W. Jack Plants II added, "Third quarter performance benefited from continued growth in average earning assets and effective balance sheet management, supporting a 3.70% net interest margin and a nearly 5% increase in net interest income from the prior year period. Our balance sheet remains a source of strength, reflected in a tangible common equity ratio⁽¹⁾ of 8.40%, a common equity Tier 1 ratio of 11.36%, and a return on average tangible common equity⁽¹⁾ of 13.75%. These strong capital levels provide us flexibility to support loan growth and thoughtful investments in our business, while continuing to return capital to shareholders through share buybacks, as we did during the third quarter with the repurchase of 185,833 shares."

Net Interest Income and Net Interest Margin

NET INTEREST INCOME										QoQ					YoY
Dollars in thousands	Q3 2026			Q2 2026			Q3 2025			Variance			%		Variance				%
Interest income	$	85,003		$	83,076		$	84,422		$	1,927		2.3	%	$	581			0.7	%
Interest expense		30,712			29,715			32,633			997		3.4	%		(1,921	)		-5.9	%
Net interest income		54,291			53,361			51,789			930		1.7	%		2,502			4.8	%
Net interest margin (tax-equivalent basis) ⁽²⁾		3.70	%		3.70	%		3.65	%		-	bps				5		bps
Average interest-earning assets	$	5,837,535		$	5,785,900		$	5,656,869		$	51,635		0.9	%	$	180,666			3.2	%
Average interest-bearing liabilities		4,573,266			4,559,420			4,437,752			13,846		0.3	%		135,514			3.1	%

Net interest income was $54.3 million, up $930 thousand from the linked quarter and up $2.5 million from the third quarter of 2025. Net interest margin of 3.70% was consistent with the linked quarter and up 5 basis points from the year-ago quarter, driven by lower interest-bearing liability costs.

Average interest-earning assets of $5.84 billion were up $51.6 million from the second quarter of 2026 and up $180.7 million from the third quarter of 2025. The linked quarter variance reflected a $114.5 million increase in average loans, partially offset by decreases in the average balances of investment securities of $61.6 million and Federal Reserve interest-earning cash of $1.2 million. The year-over-year variance reflected a $228.2 million increase in the average balance of loans, partially offset by a $43.2 million decrease in the average balance of investment securities and a $4.3 million decrease in the average balance of Federal Reserve interest-earning cash. The average yield on interest-earning assets was 5.79% in the third quarter of 2026, compared to 5.76% in the second quarter of 2026, and 5.93% in the third quarter of 2025.
Average interest-bearing liabilities of $4.57 billion were up $13.8 million from the second quarter of 2026 and up $135.5 million from the third quarter of 2025. The linked quarter variance was primarily due to increases in the average balances of time, savings and money market deposits, partially offset by decreases in average interest-bearing demand deposits and short-term borrowings, while average long-term borrowings were flat. The year-over-year variance reflected increases in the average balances of savings and money market deposits, time deposits, short-term borrowings and interest-bearing demand deposits, partially offset by a decrease in average long-term borrowings. The average cost of interest-bearing liabilities was 2.67%, reflecting an increase of 6 basis points from the linked quarter and a decrease of 25 basis points from the year-ago quarter.

Noninterest Income

SELECT NONINTEREST INCOME CATEGORIES									QoQ Change					YoY Change
Dollars in thousands	Q3 2026			Q2 2026			Q3 2025		$			%		$			%
Investment advisory	$	3,343		$	3,287		$	3,023	$	56		1.7	%	$	320		10.6	%
Investments in limited partnerships		(274	)		(140	)		223		(134	)	95.7	%		(497	)	-222.9	%
Income from derivative instruments, net		106			518			847		(412	)	-79.5	%		(741	)	-87.5	%
Net gain on investment securities		-			-			703		-		-			(703	)	-100.0	%
Other		1,239			1,200			1,596		39		3.3	%		(357	)	-22.4	%
Total noninterest income		10,457			10,954			12,056		(497	)	-4.5	%		(1,599	)	-13.3	%

Noninterest income was $10.5 million in the third quarter of 2026, versus $11.0 million in the second quarter of 2026 and $12.1 million in the third quarter of 2025. The linked quarter variance was primarily driven by decreased income from derivative instruments, net, or swap fees, along with greater losses on investments in limited partnerships. The aforementioned lower level of swap fees and loss on limited partnerships were also contributors to the year-over-year variance. Detail on other select categories with notable variances follows:

Investment advisory income of $3.3 million was up from both the linked and year-ago quarters, reflecting both new business and market performance.
A loss on investments in limited partnerships, which are primarily small business investment companies, of $274 thousand was recognized in the third quarter of 2026, compared to a loss of $140 thousand and a gain of $223 thousand in the linked and year-ago quarters, respectively. Income from these investments, which we account for under the equity method, fluctuates based on the maturity and performance of the underlying investments.
Income from derivative instruments, net, which is based on the number and value of interest rate swap transactions executed during the quarter, of $106 thousand was down from $518 thousand and $847 thousand in the linked and year-ago quarters, respectively.
A net gain on investment securities of $703 thousand was recorded in the third quarter of 2025. There was no gain or loss recorded in the second or third quarters of 2026.
Other noninterest income of $1.2 million was relatively flat with the linked quarter and down from the year-ago quarter, driven by a variety of factors.

Noninterest Expense and Income Taxes

SELECT NONINTEREST EXPENSE CATEGORIES							QoQ Change				YoY Change
Dollars in thousands	Q3 2026		Q2 2026		Q3 2025		$		%		$			%
Salaries and employee benefits	$	19,654	$	19,165	$	18,522	$	489	2.6	%	$	1,132		6.1	%
Professional services		1,475		1,263		1,688		212	16.8	%		(213	)	-12.6	%
Total noninterest expense		36,822		35,605		35,875		1,217	3.4	%		947		2.6	%

Noninterest expense was $36.8 million in the third quarter of 2026, compared to $35.6 million in the second quarter of 2026 and $35.9 million in the third quarter of 2025. Detail on select categories with notable variances follows:

Salaries and employee benefits expense was $489 thousand higher than the second quarter of 2026, primarily driven by an increase in health insurance benefit expense, and $1.1 million higher than the third quarter of 2025, reflecting a combination of factors, including annual merit increases, higher incentive compensation and investments in personnel.
Professional services expense was $212 thousand higher than the linked quarter, driven in part by the timing of typical external audit-related expenses. The $213 thousand decrease year-over-year was driven by lower other professional and consulting expenses.

INCOME TAXES										QoQ					YoY
Dollars in thousands	Q3 2026			Q2 2026			Q3 2025			Variance			%		Variance			%
Income tax expense	$	4,057		$	4,418		$	4,761		$	(361	)	-8.2	%	$	(704	)	-14.8	%
Tax credit on investments placed in service/amortized		1,045			1,045			1,103			-		0.0	%		(58	)	-5.3	%
Effective tax rate		16.9	%		17.3	%		18.9	%		-0.4	%				-2.0	%

Income tax expense was $4.1 million for the third quarter of 2026, compared to $4.4 million in the second quarter of 2026 and $4.8 million in the third quarter of 2025. Income tax expense reflects federal and state tax benefits that the Company recognized related to tax credit investments placed in service and/or amortized during each period, as outlined above.

The effective tax rate, which was 16.9% for the third quarter of 2026, fluctuates on a quarterly basis primarily due to the level of pre-tax earnings or loss and may differ from statutory rates due to interest income from tax-exempt securities, earnings on COLI, the tax impact of restricted stock award vesting, and the impact of tax credit investments.

Balance Sheet Composition and Liquidity

SELECT BALANCE SHEET DATA							QoQ Change					YoY Change
Dollars in thousands, end of period	Q3 2026		Q2 2026		Q3 2025		$			%		$			%
Total assets	$	6,506,919	$	6,334,952	$	6,288,052	$	171,967		2.7	%	$	218,867		3.5	%
Total investment securities		1,034,758		989,764		1,011,217		44,994		4.5	%		23,541		2.3	%
Commercial business and commercial mortgage		3,305,501		3,210,384		2,989,710		95,117		3.0	%		315,791		10.6	%
Residential real estate		740,524		738,681		724,506		1,843		0.2	%		16,018		2.2	%
Consumer indirect and other consumer		809,802		803,900		876,207		5,902		0.7	%		(66,405	)	-7.6	%
Total loans		4,855,827		4,752,965		4,590,423		102,862		2.2	%		265,404		5.8	%
Total deposits		5,474,936		5,299,465		5,357,809		175,471		3.3	%		117,127		2.2	%
Short-term borrowings		167,000		182,000		55,000		(15,000	)	-8.2	%		112,000		203.6	%
Long-term borrowings, net		78,768		78,694		115,000		74		0.1	%		(36,232	)	-31.5	%

Total loans of $4.86 billion at September 30, 2026 were up $102.9 million from the end of the linked quarter and up $265.4 million from September 30, 2025.

Strong commercial lending activity in the Bank's Western and Central New York markets drove both the linked quarter and year-over-year growth.

Total deposits were $5.47 billion at September 30, 2026, up $175.5 million from June 30, 2026, and up $117.1 million from September 30, 2025.

The linked quarter variance was primarily due to seasonally higher public deposit balances, but reflected growth across all deposit types. The year-over-year increase reflected higher nonpublic, reciprocal and brokered deposits, partially offset by a modest decrease in public deposits. Public deposits represented 22% of total deposits at September 30, 2026, 22% at June 30, 2026, and 23% at September 30, 2025.

LIQUIDITY SOURCES							QoQ Change					YoY Change
Dollars in thousands, end of period	Q3 2026		Q2 2026		Q3 2025		$			%		$			%
Unencumbered securities	$	6,853	$	29,876	$	58,476	$	(23,023	)	-77.1	%	$	(51,623	)	-88.3	%
FHLBNY borrowing availability		204,714		182,426		288,811		22,288		12.2	%		(84,097	)	-29.1	%
FRB excess cash		37,629		39,564		96,968		(1,935	)	-4.9	%		(59,339	)	-61.2	%
FRB discount window		922,388		900,825		956,770		21,563		2.4	%		(34,382	)	-3.6	%
Total on-balance sheet liquidity		1,171,584		1,152,691		1,401,025		18,893		1.6	%		(229,441	)	-16.4	%

The Company maintains liquidity, both on and off-balance sheet, to meet customer demand. As outlined in the table above, at September 30, 2026, the Company had approximately $1.17 billion in available liquidity, excluding brokered deposit capacity, in addition to cash and cash equivalents of $102.9 million and available unsecured lines of credit totaling $155.0 million.

Capital Strength and Shareholder Returns

REGULATORY CAPITAL RATIOS	Q3 2026			Q2 2026			Q3 2025			QoQ Change				YoY Change
Leverage Ratio		10.09	%		10.06	%		9.77	%		3		bps		32	bps
Common Equity Tier 1 Ratio		11.36	%		11.44	%		11.15	%		(8	)	bps		21	bps
Tier 1 Capital Ratio		11.68	%		11.76	%		11.48	%		(8	)	bps		20	bps
Total Risk Based Capital Ratio		14.07	%		14.20	%		13.60	%		(13	)	bps		47	bps

The Company's regulatory capital ratios at September 30, 2026 continued to exceed all regulatory capital requirements to be considered well capitalized.

SELECT SHAREHOLDERS' EQUITY AND PER SHARE DATA										QoQ						YoY
Dollars in thousands, except per share data	Q3 2026			Q2 2026			Q3 2025			Variance				%		Variance				%
Shareholders' equity	$	618,993		$	643,441		$	621,720		$	(24,448	)		-3.8	%	$	(2,727	)		-0.4	%
Common shareholders' equity		601,710			626,156			604,435			(24,446	)		-3.9	%		(2,725	)		-0.5	%
Tangible common equity ⁽¹⁾		541,655			566,007			543,992			(24,352	)		-4.3	%		(2,337	)		-0.4	%
Common book value per share	$	30.82		$	31.77		$	30.03		$	(0.95	)		-3.0	%	$	0.79			2.6	%
Tangible common book value per share ⁽¹⁾	$	27.75		$	28.72		$	27.02		$	(0.97	)		-3.4	%	$	0.73			2.7	%
Common equity to assets ratio		9.25	%		9.88	%		9.61	%		(64	)	bps				(37	)	bps
Tangible common equity to tangible assets ratio ⁽¹⁾		8.40	%		9.02	%		8.74	%		(62	)	bps				(33	)	bps

Shareholders' equity was $619.0 million at September 30, 2026, compared to $643.4 million at June 30, 2026, and $621.7 million at September 30, 2025. The decline was primarily the result of an increase in accumulated other comprehensive loss associated with unrealized losses in the available for sale securities portfolio, which was driven by the increase in interest rates, as well as stock repurchases during the third quarter of 2026, partially offset by net income, net of dividends, retained.

The Company declared a common stock dividend of $0.32 per common share in the third quarter of 2026, consistent with the linked quarter and reflecting an increase of $0.01, or 3.2%, over the year-ago quarter, returning 32% of third quarter net income to common shareholders.

During the third quarter of 2026, the Company repurchased 185,833 shares of common stock at an average price of $40.92 per share. As of September 30, 2026, 320,480 shares remained available under the repurchase program that was approved in September 2025 and which does not have an expiration date.

Credit Quality

SELECT CREDIT QUALITY METRICS										QoQ						YoY
Dollars in thousands	Q3 2026			Q2 2026			Q3 2025			Variance				%		Variance				%
Non-performing loans	$	38,542		$	39,007		$	33,951		$	(465	)		-1.2	%	$	4,591			13.5	%
Total non-performing loans to total loans		0.79	%		0.82	%		0.74	%		(3	)	bps				5		bps
Allowance for credit losses "ACL" - loans		48,014			47,497			47,292			517			1.1	%		722			1.5	%
ACL - loans to total loans ratio		0.99	%		1.00	%		1.03	%		(1	)	bps				(4	)	bps
Provision for credit losses - loans	$	4,542		$	4,133		$	2,062		$	409			9.9	%	$	2,480			120.3	%
Provision for credit losses		3,879			3,108			2,732			771			24.8	%	$	1,147			42.0	%
Net charge-offs/average loans (annualized)		0.33	%		0.11	%		0.18	%		22		bps				15		bps

The Company has remained strategically focused on the importance of credit discipline, allocating resources to credit and risk management functions as the loan portfolio has grown.

Non-performing loans were $38.5 million, or 0.79% of total loans, at September 30, 2026, a modest decrease from the linked quarter. The increase from one year prior primarily reflects one well-collateralized commercial business loan that moved to nonaccrual status in the first quarter of 2026, offset in part by the partial charge-off of a previously disclosed nonaccrual commercial business relationship for which a specific reserve was in place.
Provision for credit losses was $3.9 million in the third quarter of 2026 and was driven by a combination of factors, including loan growth and fluctuation in the balance of unfunded commitments. The provision for credit losses on unfunded commitments, which is included in the provision for credit losses as required by the current expected credit loss standard, totaled a credit of $663 thousand in the third quarter of 2026, compared to a credit of $1.0 million in the second quarter of 2026 and a provision of $671 thousand in the third quarter of 2025.

Subsequent Events

The Company is required, under U.S. generally accepted accounting principles ("GAAP"), to evaluate subsequent events through the filing of its consolidated financial statements for the quarter ended September 30, 2026 on Form 10-Q. As a result, the Company will continue to evaluate the impact of any subsequent events on critical accounting assumptions and estimates made as of September 30, 2026, and will adjust amounts preliminarily reported, if necessary, in its Form 10-Q as filed with the Securities and Exchange Commission (the "SEC").

Conference Call

The Company will host an earnings conference call and audio webcast on October 30, 2026, at 8:30 a.m. Eastern Time. The call will be hosted by Martin K. Birmingham, President and Chief Executive Officer, and W. Jack Plants II, Chief Financial Officer and Treasurer. Within the United States, participants may access the call by dialing 1-877-425-9470 and requesting the “Financial Institutions, Inc. Third Quarter 2026 Earnings Conference Call.” A live webcast will also be available at https://viavid.webcasts.com/starthere.jsp?ei=1776786&tp_key=90ac35b0c7 in listen-only mode. A replay of the webcast will be available on the Company’s IR website, www.FISI-Investors.com, for at least 30 days.

About Financial Institutions, Inc.

Financial Institutions, Inc. (NASDAQ: FISI) is a financial holding company with approximately $6.5 billion in assets offering banking and wealth management products and services. Its Five Star Bank subsidiary provides consumer and commercial banking and lending services to individuals, municipalities and businesses through banking locations spanning Western and Central New York and a commercial loan production office serving the Mid-Atlantic region. Its Courier Capital, LLC subsidiary offers customized investment management, consulting and retirement plan services to individuals, businesses, institutions, foundations and retirement plans. Learn more at FISI-Investors.com.

Non-GAAP Financial Information

In addition to results presented in accordance with GAAP, this press release contains certain non-GAAP financial measures. A reconciliation of these non-GAAP measures to GAAP measures is included in Appendix A to this document.

The Company believes that providing certain non-GAAP financial measures provides investors with information useful in understanding our financial performance, performance trends and financial position. Our management uses these measures for internal planning and forecasting purposes and we believe that our presentation and discussion, together with the accompanying reconciliations, allows investors, security analysts and other interested parties to view our performance and the factors and trends affecting our business in a manner similar to management. These non-GAAP measures should not be considered a substitute for GAAP measures, and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure to evaluate the Company. Non-GAAP financial measures have inherent limitations, are not uniformly applied and are not audited. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names.

Safe Harbor Statement

This press release may contain forward-looking statements as defined by Section 21E of the Securities Exchange Act of 1934, as amended, that involve significant risks and uncertainties. In this context, forward-looking statements often address our expected future business and financial performance and financial condition, and often contain words such as "anticipate," "believe," "continue," "estimate," "expect," "focus," "forecast," "intend," "may," "plan," "preliminary," "should," "target" or "will." Statements herein are based on certain assumptions and analyses by the Company and factors it believes are appropriate in the circumstances. Actual results could differ materially from those contained in or implied by such statements for a variety of reasons including, but not limited to: changes in interest rates; inflation; tariffs; changes in deposit flows and the cost and availability of funds; fraudulent deposit activity; the Company’s ability to implement its strategic plan, including by expanding its commercial lending footprint and integrating its acquisitions; whether the Company experiences greater credit losses than expected; whether the Company experiences breaches of its, or third party, information systems; the attitudes and preferences of the Company's customers; legal and regulatory proceedings and related matters, including any action described in the Company's reports filed with the SEC, could adversely affect it and the banking industry in general; the competitive environment; fluctuations in the fair value of securities in its investment portfolio; changes in the regulatory environment and the Company's compliance with regulatory requirements; general economic and credit market conditions nationally and regionally; and macroeconomic volatility related to global political unrest. Consequently, all forward-looking statements made herein are qualified by these cautionary statements and the cautionary language and risk factors included in the Company's Annual Report on Form 10-K, its Quarterly Reports on Form 10-Q and other documents filed with the SEC. Except as required by law, the Company undertakes no obligation to revise these statements following the date of this press release.

_{⁽¹⁾ See Appendix A — Reconciliation to Non-GAAP Financial Measures for the computation of this non-GAAP financial measure.}
_{⁽²⁾ Calculated on a tax-equivalent basis assuming a Federal income tax rate of 21%.}

FINANCIAL INSTITUTIONS, INC. Selected Financial Information (Unaudited) (Amounts in thousands, except per share amounts)
	2026									2025
SELECT BALANCE SHEET DATA:	September 30,			June 30,			March 31,			December 31,			September 30,
Cash and cash equivalents	$	102,883		$	99,174		$	85,451		$	108,751		$	185,945
Investment securities:
Available for sale		958,239			910,466			1,003,697			922,472			923,592
Held-to-maturity, net		76,519			79,298			82,074			84,708			87,625
Total investment securities		1,034,758			989,764			1,085,771			1,007,180			1,011,217
Loans held for sale		1,913			2,502			1,034			3,365			2,252
Loans:
Commercial business		773,008			768,549			746,425			738,307			740,603
Commercial mortgage–construction		625,095			558,036			513,615			488,558			441,034
Commercial mortgage–multifamily		560,780			565,027			578,731			588,732			592,634
Commercial mortgage–non-owner occupied		1,001,518			970,966			922,628			942,219			893,884
Commercial mortgage–owner occupied		345,100			347,806			316,781			322,776			321,555
Residential real estate loans		663,160			662,582			652,861			657,001			648,397
Residential real estate lines		77,364			76,099			74,779			75,121			76,109
Consumer indirect		779,059			771,126			787,888			807,310			838,671
Other consumer		30,743			32,774			33,879			37,842			37,536
Total loans		4,855,827			4,752,965			4,627,587			4,657,866			4,590,423
Allowance for credit losses–loans		48,014			47,497			44,661			47,386			47,292
Total loans, net		4,807,813			4,705,468			4,582,926			4,610,480			4,543,131
Total interest-earning assets		6,020,962			5,834,020			5,787,556			5,755,696			5,739,699
Goodwill and other intangible assets, net		60,055			60,149			60,245			60,343			60,443
Total assets		6,506,919			6,334,952			6,294,783			6,274,140			6,288,052
Deposits:
Noninterest-bearing demand		974,634			950,510			953,397			962,724			959,404
Interest-bearing demand		769,479			712,124			744,690			672,323			776,445
Savings and money market		2,021,827			1,964,402			1,984,048			1,884,801			1,955,832
Time deposits		1,708,996			1,672,429			1,655,746			1,686,500			1,666,128
Total deposits		5,474,936			5,299,465			5,337,881			5,206,348			5,357,809
Short-term borrowings		167,000			182,000			114,000			109,000			55,000
Long-term borrowings, net		78,768			78,694			78,621			193,653			115,000
Total interest-bearing liabilities		4,746,070			4,609,649			4,577,105			4,546,277			4,568,405
Shareholders’ equity		618,993			643,441			631,670			628,854			621,720
Common shareholders’ equity		601,710			626,156			614,385			611,569			604,435
Tangible common equity ⁽¹⁾		541,655			566,007			554,140			551,226			543,992
Accumulated other comprehensive loss		(74,414	)		(43,349	)		(39,327	)	$	(33,030	)	$	(36,758	)

Common shares outstanding		19,521			19,706			19,686			19,797			20,130
Treasury shares		1,179			993			1,013			902			570
CAPITAL RATIOS AND PER SHARE DATA:
Leverage ratio		10.09	%		10.06	%		9.89	%		9.69	%		9.77	%
Common equity Tier 1 capital ratio		11.36	%		11.44	%		11.37	%		11.11	%		11.15	%
Tier 1 capital ratio		11.68	%		11.76	%		11.70	%		11.43	%		11.48	%
Total risk-based capital ratio		14.07	%		14.20	%		14.16	%		14.90	%		13.60	%
Common equity to assets		9.25	%		9.88	%		9.76	%		9.75	%		9.61	%
Tangible common equity to tangible assets ⁽¹⁾		8.40	%		9.02	%		8.89	%		8.87	%		8.74	%

Common book value per share	$	30.82		$	31.77		$	31.21		$	30.89		$	30.03
Tangible common book value per share ⁽¹⁾	$	27.75		$	28.72		$	28.15		$	27.84		$	27.02
_{⁽¹⁾ See Appendix A — Reconciliation to Non-GAAP Financial Measures for the computation of this non-GAAP financial measure.}

FINANCIAL INSTITUTIONS, INC. Selected Financial Information (Unaudited) (Amounts in thousands, except per share amounts)
	Nine Months Ended						2026									2025
SELECT STATEMENT OF OPERATIONS	September 30,						Third			Second			First			Fourth			Third
DATA:	2026			2025			Quarter			Quarter			Quarter			Quarter			Quarter
Interest income	$	249,642		$	248,340		$	85,003		$	83,076		$	81,563		$	84,649		$	84,422
Interest expense		89,997			100,565			30,712			29,715			29,570			32,438			32,633
Net interest income		159,645			147,775			54,291			53,361			51,993			52,211			51,789
Provision for credit losses		9,226			8,222			3,879			3,108			2,239			3,404			2,732
Net interest income after provision for credit losses		150,419			139,553			50,412			50,253			49,754			48,807			49,057
Noninterest income:
Service charges on deposits		3,244			3,278			1,117			1,083			1,044			1,082			1,137
Card interchange income		6,026			5,783			2,071			2,063			1,892			2,011			2,006
Investment advisory		9,691			8,645			3,343			3,287			3,061			3,074			3,023
Company owned life insurance		8,588			8,591			2,932			2,884			2,772			2,788			2,849
Investments in limited partnerships		(190	)		945			(274	)		(140	)		224			457			223
Loan servicing		541			484			189			201			151			208			181
Income from derivative instruments, net		863			1,436			106			518			239			1,110			847
Net gain on sale of loans held for sale		491			542			185			181			125			195			285
Net gain on investment securities		328			706			-			-			328			225			703
Net (loss) gain on other assets		(454	)		(281	)		-			27			(481	)		(225	)		(281	)
Net loss on tax credit investments		(1,253	)		(1,539	)		(451	)		(350	)		(452	)		(446	)		(513	)
Other		4,209			4,456			1,239			1,200			1,770			1,430			1,596
Total noninterest income		32,084			33,046			10,457			10,954			10,673			11,909			12,056
Noninterest expense:
Salaries and employee benefits		57,421			53,490			19,654			19,165			18,601			19,323			18,522
Occupancy and equipment		11,968			11,386			4,161			3,941			3,865			4,104			3,814
Professional services		4,088			4,830			1,475			1,263			1,350			1,686			1,688
Computer and data processing		17,349			17,155			5,627			5,512			6,211			5,934			5,789
FDIC assessments		3,041			4,086			1,068			987			986			984			1,227
Advertising and promotions		1,559			1,328			444			592			524			482			491
Amortization of intangibles		288			315			94			96			98			100			103
Deposit-related charged-off items expense		443			83			207			126			109			77			144
Other		11,865			12,569			4,092			3,923			3,851			4,029			4,097
Total noninterest expense		108,022			105,242			36,822			35,605			35,595			36,719			35,875
Income before income taxes		74,481			67,357			24,047			25,602			24,832			23,997			25,238
Income tax expense		12,321			12,470			4,057			4,418			3,847			4,017			4,761
Net income		62,160			54,887			19,990			21,184			20,985			19,980			20,477
Preferred stock dividends		1,094			1,094			364			365			364			364			365
Net income available to common shareholders	$	61,066		$	53,793		$	19,626		$	20,819		$	20,621		$	19,616		$	20,112
FINANCIAL RATIOS:
Earnings per share – basic	$	3.11		$	2.68		$	1.00		$	1.06		$	1.05		$	0.98		$	1.00
Earnings per share – diluted	$	3.07		$	2.65		$	0.99		$	1.04		$	1.04		$	0.96		$	0.99
Cash dividends declared on common stock	$	0.96		$	0.93		$	0.32		$	0.32		$	0.32		$	0.31		$	0.31
Common dividend payout ratio		30.87	%		34.70	%		32.00	%		30.19	%		30.48	%		31.63	%		31.00	%
Dividend yield (annualized)		3.29	%		4.57	%		3.26	%		3.29	%		4.09	%		3.95	%		4.52	%
Return on average assets (annualized)		1.33	%		1.18	%		1.26	%		1.35	%		1.37	%		1.27	%		1.32	%
Return on average equity (annualized)		13.01	%		12.32	%		12.32	%		13.31	%		13.43	%		12.53	%		13.31	%
Return on average common equity (annualized)		13.14	%		12.44	%		12.43	%		13.44	%		13.57	%		12.64	%		13.45	%
Return on average tangible common equity (annualized) ⁽¹⁾		14.55	%		13.89	%		13.75	%		14.88	%		15.04	%		14.02	%		14.98	%
Efficiency ratio ⁽²⁾		56.40	%		58.38	%		56.84	%		55.33	%		57.06	%		57.43	%		56.78	%
Effective tax rate		16.5	%		18.5	%		16.9	%		17.3	%		15.5	%		16.7	%		18.9	%
_{⁽¹⁾ See Appendix A – Reconciliation to Non-GAAP Financial Measures for the computation of this non-GAAP financial measure.} _{⁽²⁾ The efficiency ratio is calculated by dividing noninterest expense by net revenue, i.e., the sum of net interest income (tax-equivalent basis assuming a Federal income tax rate of 21%) and noninterest income before net gains on investment securities. This is a banking industry measure not required by GAAP.}

FINANCIAL INSTITUTIONS, INC. Selected Financial Information (Unaudited) (Amounts in thousands)
	Nine Months Ended						2026									2025
	September 30,						Third			Second			First			Fourth			Third
SELECT AVERAGE BALANCES:	2026			2025			Quarter			Quarter			Quarter			Quarter			Quarter
Federal funds sold and interest-earning deposits	$	28,566		$	47,271		$	27,120		$	28,347		$	30,266		$	48,418		$	31,461
Investment securities ⁽¹⁾		1,049,543			1,072,077			1,016,043			1,077,633			1,055,385			1,066,829			1,059,244
Loans:
Commercial business		748,647			708,298			762,740			745,977			736,942			731,314			726,315
Commercial mortgage		2,407,298			2,221,845			2,485,369			2,392,003			2,342,957			2,313,465			2,239,666
Residential real estate loans		657,336			646,891			662,283			655,028			654,614			650,190			648,642
Residential real estate lines		75,222			75,168			76,598			74,853			74,189			75,288			75,774
Consumer indirect		783,321			841,830			775,732			779,336			795,107			823,521			838,026
Other consumer		33,137			39,802			31,650			32,723			35,074			36,917			37,741
Total loans		4,704,961			4,533,834			4,794,372			4,679,920			4,638,883			4,630,695			4,566,164
Total interest-earning assets		5,783,070			5,653,182			5,837,535			5,785,900			5,724,534			5,745,942			5,656,869
Goodwill and other intangible assets, net		60,207			60,610			60,112			60,207			60,305			60,404			60,505
Total assets		6,270,963			6,198,689			6,312,602			6,271,961			6,227,388			6,261,856			6,159,886
Interest-bearing liabilities:
Interest-bearing demand		703,121			721,179			691,497			701,768			716,370			713,033			687,978
Savings and money market		1,954,029			1,936,765			1,977,954			1,976,903			1,906,445			1,924,952			1,881,445
Time deposits		1,687,635			1,613,532			1,702,746			1,676,759			1,683,185			1,692,138			1,643,342
Short-term borrowings		118,654			97,165			122,337			125,331			108,138			79,913			110,011
Long-term borrowings, net		85,489			118,737			78,732			78,659			99,302			133,242			114,976
Total interest-bearing liabilities		4,548,928			4,487,378			4,573,266			4,559,420			4,513,440			4,543,278			4,437,752
Noninterest-bearing demand deposits		951,090			936,854			958,502			944,037			950,644			955,880			960,089
Total deposits		5,295,875			5,208,330			5,330,699			5,299,467			5,256,644			5,286,003			5,172,854
Total liabilities		5,632,286			5,603,129			5,668,894			5,633,343			5,593,794			5,629,101			5,549,575
Shareholders’ equity		638,677			595,560			643,708			638,618			633,594			632,755			610,311
Common equity		621,392			578,275			626,423			621,333			616,309			615,470			593,026
Tangible common equity ⁽²⁾		561,185			517,665			566,311			561,126			556,004			555,066			532,521
Common shares outstanding:
Basic		19,650			20,101			19,620			19,687			19,642			20,093			20,122
Diluted		19,922			20,306			19,902			19,941			19,922			20,347			20,336
SELECTED AVERAGE YIELDS: *(Tax equivalent basis)*
Investment securities ⁽³⁾		4.47	%		4.35	%		4.46	%		4.46	%		4.48	%		4.48	%		4.45	%
Loans		6.07	%		6.25	%		6.08	%		6.07	%		6.07	%		6.20	%		6.29	%
Total interest-earning assets		5.77	%		5.87	%		5.79	%		5.76	%		5.76	%		5.86	%		5.93	%
Interest-bearing demand		1.06	%		1.15	%		1.07	%		1.08	%		1.04	%		1.20	%		1.09	%
Savings and money market		2.34	%		2.68	%		2.39	%		2.33	%		2.29	%		2.46	%		2.62	%
Time deposits		3.45	%		4.09	%		3.43	%		3.38	%		3.53	%		3.73	%		3.88	%
Short-term borrowings		2.57	%		2.13	%		2.66	%		2.62	%		2.40	%		1.77	%		2.41	%
Long-term borrowings, net		6.93	%		5.28	%		6.98	%		6.99	%		6.84	%		6.31	%		5.53	%
Total interest-bearing liabilities		2.64	%		3.00	%		2.67	%		2.61	%		2.65	%		2.83	%		2.92	%
Net interest rate spread		3.13	%		2.87	%		3.12	%		3.15	%		3.11	%		3.03	%		3.01	%
Net interest margin		3.69	%		3.50	%		3.70	%		3.70	%		3.67	%		3.62	%		3.65	%
_{⁽¹⁾ Includes investment securities at adjusted amortized cost.} _{⁽²⁾ See Appendix A – Reconciliation to Non-GAAP Financial Measures for the computation of this non-GAAP financial measure.} _{⁽³⁾ The interest on tax-exempt securities is calculated on a tax-equivalent basis assuming a Federal income tax rate of 21%.}

FINANCIAL INSTITUTIONS, INC. Selected Financial Information (Unaudited) (Amounts in thousands)
	Nine Months Ended						2026									2025
	September 30,						Third			Second			First			Fourth			Third
ASSET QUALITY DATA:	2026			2025			Quarter			Quarter			Quarter			Quarter			Quarter
Allowance for Credit Losses – Loans
Beginning balance	$	47,386		$	48,041		$	47,497		$	44,661		$	47,386		$	47,292		$	47,291
Net loan charge-offs (recoveries):
Commercial business		3,311			2,083			344			(23	)		2,990			46			123
Commercial mortgage–construction		963			(357	)		963			-			-			(10	)		(357	)
Commercial mortgage–multifamily		-			-			-			-			-			-			-
Commercial mortgage–non-owner occupied		(3	)		594			(1	)		(1	)		(1	)		-			(1	)
Commercial mortgage–owner occupied		(2	)		(3	)		(1	)		-			(1	)		-			(1	)
Residential real estate loans		8			108			(11	)		-			19			(4	)		(25	)
Residential real estate lines		27			27			-			30			(3	)		-			-
Consumer indirect		5,000			5,017			2,010			1,140			1,850			2,239			1,926
Other consumer		1,098			1,011			721			151			226			140			396
Total net charge-offs (recoveries)		10,402			8,480			4,025			1,297			5,080			2,411			2,061
Provision for credit losses–loans		11,030			7,731			4,542			4,133			2,355			2,505			2,062
Ending balance	$	48,014		$	47,292		$	48,014		$	47,497		$	44,661		$	47,386		$	47,292

Net charge-offs (recoveries) to average loans (annualized):
Commercial business		0.59	%		0.39	%		0.18	%		-0.01	%		1.65	%		0.02	%		0.07	%
Commercial mortgage–construction		0.24	%		-0.90	%		0.64	%		0.00	%		0.00	%		-0.01	%		-0.31	%
Commercial mortgage–multifamily		0.00	%		0.00	%		0.00	%		0.00	%		0.00	%		0.00	%		0.00	%
Commercial mortgage–non-owner occupied		0.00	%		0.90	%		0.00	%		0.00	%		0.00	%		0.00	%		0.00	%
Commercial mortgage–owner occupied		0.00	%		0.00	%		0.00	%		0.00	%		0.00	%		0.00	%		0.00	%
Residential real estate loans		0.00	%		0.02	%		-0.01	%		0.00	%		0.01	%		0.00	%		-0.02	%
Residential real estate lines		0.05	%		0.05	%		0.16	%		0.16	%		-0.03	%		0.00	%		0.00	%
Consumer indirect		0.85	%		0.80	%		1.03	%		0.59	%		0.94	%		1.08	%		0.91	%
Other consumer		4.43	%		3.40	%		9.04	%		1.85	%		2.61	%		1.50	%		4.16	%
Total loans		0.30	%		0.25	%		0.33	%		0.11	%		0.44	%		0.21	%		0.18	%

Supplemental information ⁽¹⁾
Non-performing loans:
Commercial business	$	6,613		$	3,799		$	6,613		$	7,677		$	6,698		$	4,709		$	3,799
Commercial mortgage–construction		19,069			19,794			19,069			20,520			20,520			20,321			19,794
Commercial mortgage–multifamily		1,019			540			1,019			540			540			540			540
Commercial mortgage–non-owner occupied		-			-			-			-			-			-			-
Commercial mortgage–owner occupied		973			1,102			973			981			983			1,095			1,102
Residential real estate loans		8,141			5,877			8,141			6,974			7,434			6,443			5,877
Residential real estate lines		266			212			266			412			431			374			212
Consumer indirect		2,331			2,482			2,331			1,772			1,767			2,155			2,482
Other consumer		130			145			130			131			102			118			145
Total non-performing loans		38,542			33,951			38,542			39,007			38,475			35,755			33,951
Foreclosed assets		3,544			142			3,544			552			552			94			142
Total non-performing assets	$	42,086		$	34,093		$	42,086		$	39,559		$	39,027		$	35,849		$	34,093

Total non-performing loans to total loans		0.79	%		0.74	%		0.79	%		0.82	%		0.83	%		0.77	%		0.74	%
Total non-performing assets to total assets		0.65	%		0.54	%		0.65	%		0.62	%		0.62	%		0.57	%		0.54	%
Allowance for credit losses–loans to total loans		0.99	%		1.03	%		0.99	%		1.00	%		0.97	%		1.02	%		1.03	%
Allowance for credit losses–loans to non-performing loans		125	%		139	%		125	%		122	%		116	%		133	%		139	%
_{⁽¹⁾ At period end.}

FINANCIAL INSTITUTIONS, INC. Appendix A — Reconciliation to Non-GAAP Financial Measures (Unaudited) (In thousands, except per share amounts)
	Nine Months Ended						2026									2025
	September 30,						Third			Second			First			Fourth			Third
	2026			2025			Quarter			Quarter			Quarter			Quarter			Quarter
Ending tangible assets:
Total assets							$	6,506,919		$	6,334,952		$	6,294,783		$	6,274,140		$	6,288,052
Less: Goodwill and other intangible assets, net								60,055			60,149			60,245			60,343			60,443
Tangible assets							$	6,446,864		$	6,274,803		$	6,234,538		$	6,213,797		$	6,227,609

Ending tangible common equity:
Common shareholders’ equity							$	601,710		$	626,156		$	614,385		$	611,569		$	604,435
Less: Goodwill and other intangible assets, net								60,055			60,149			60,245			60,343			60,443
Tangible common equity							$	541,655		$	566,007		$	554,140		$	551,226		$	543,992

Tangible common equity to tangible assets ⁽¹⁾								8.40	%		9.02	%		8.89	%		8.87	%		8.74	%

Common shares outstanding								19,521			19,706			19,686			19,797			20,130
Tangible common book value per share ⁽²⁾							$	27.75		$	28.72		$	28.15		$	27.84		$	27.02

Average tangible assets:
Average assets	$	6,270,963		$	6,198,689		$	6,312,602		$	6,271,961		$	6,227,388		$	6,261,856		$	6,159,886
Less: Average goodwill and other intangible assets, net		60,207			60,610			60,112			60,207			60,305			60,404			60,505
Average tangible assets	$	6,210,756		$	6,138,079		$	6,252,490		$	6,211,754		$	6,167,083		$	6,201,452		$	6,099,381

Average tangible common equity:
Average common equity	$	621,392		$	578,275		$	626,423		$	621,333		$	616,309		$	615,470		$	593,026
Less: Average goodwill and other intangible assets, net		60,207			60,610			60,112			60,207			60,305			60,404			60,505
Average tangible common equity	$	561,185		$	517,665		$	566,311		$	561,126		$	556,004		$	555,066		$	532,521

Net income available to common shareholders	$	61,066		$	53,793		$	19,626		$	20,819		$	20,621		$	19,616		$	20,112
Return on average tangible common equity ⁽³⁾		14.55	%		13.89	%		13.75	%		14.88	%		15.04	%		14.02	%		14.98	%
_{⁽¹⁾ Tangible common equity divided by tangible assets.} _{⁽²⁾ Tangible common equity divided by common shares outstanding.} _{⁽³⁾ Net income available to common shareholders (annualized) divided by average tangible common equity.}

For additional information contact:
Kate Croft
Director of Investor Relations and Corporate Communications
(716) 817-5159
klcroft@five-starbank.com

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What were Financial Institutions' earnings for the third quarter of 2026?

Financial Institutions earned $19.6 million available to common shareholders, or $0.99 per diluted share. Common-shareholder income declined 5.7% from the second quarter and 2.4% year over year. Diluted earnings compared with $1.04 sequentially and $0.99 a year earlier.

What drove Financial Institutions' deposit growth in the third quarter of 2026?

Seasonally higher public deposits primarily drove sequential deposit growth, although all deposit types increased. Year-over-year growth reflected higher nonpublic, reciprocal and brokered deposits, partially offset by lower public deposits. Public deposits represented 22% of total deposits at September 30, 2026.

What capital ratios did Financial Institutions report for the third quarter of 2026?

Financial Institutions reported a common equity Tier 1 ratio of 11.36% and a tangible common equity ratio of 8.40%. These measure capital relative to risk-weighted assets and tangible assets, respectively.

Financial Institutions, Inc. Reports Net Income Available to Common Shareholders of $19.6 million, or $0.99 per Diluted Share, for the Third Quarter of 2026