On this page of StockholderLetter.com we present the latest annual shareholder letter from CHEMUNG FINANCIAL CORP — ticker symbol CHMG. Reading current and past CHMG letters to shareholders can bring important insights into the investment thesis.

 •  4/23/2025 Letter Continued (Full PDF)
 •  4/27/2023 CHMG Stockholder Letter
 •  4/24/2024 CHMG Stockholder Letter
 •  More "Banking & Savings" Category Stockholder Letters
 •  CHMG Benford's Law Stock Score = 98

CHMG Shareholder/Stockholder Letter Transcript:

2024
ANNUAL REPORT
Chemung Financial Corporation

As New York State   s oldest independent community bank, it   s an honor to
celebrate the vibrant history and roots of our institution and the
communities around it. This year, we celebrate the Erie Canal   s
bicentennial. The Canal runs throughout our bank's footprint, from Albany
(Peebles Island, Waterford pictured right on the cover) through Syracuse
and in Seneca Falls    backyard (Seneca Canal, connecting the Erie Canal &
Seneca Lake, pictured center on the cover) to Buffalo, where our newest
division opened in Williamsville, NY (the left photo on the cover, where
Lake Erie & the Erie Canal meet).

Financial Highlights
(in thousands, except per share data and employee count)
Operating Results - Year Ended December 31:
Net interest income
Provision (credit) for credit losses (1)
Other operating income:
Wealth Management Group fee income
Other income
Other operating expenses
Income tax expense
Net income
At Year End:
Assets
Loans, net of deferred loan fees
Allowance for credit losses
Deposits
Shareholders    equity
Employees (full-time equivalent)
Share and Per Share Data:
Net income
Book value, at year end
Tangible book value, at year end
Dividends declared
Shares outstanding (average)
Ratios:
Allowance for credit losses to total loans
Return on average assets
Return on average equity
Return on average tangible equity
Efficiency ratio (adjusted)
Trust Assets Under Administration (market value):
as Fiduciary
as Custodian
2024
2023
% of Change
$74,059
$74,457
0.5%
(46)
3,262
N/M
11,573
11,657
10,460
14,089
10.6%
(17.3)%
67,250
64,243
4.7%
6,414
6,501
(1.3)%
$23,671
$25,000
(5.3)%
$2,776,147
2,071,419
21,388
2,396,883
215,309
343
$2,710,529
1,972,664
22,517
2,429,427
195,241
339
2.4%
5.0%
(5.0)%
(1.3)%
10.3%
1.2%
4.96
45.13
40.55
1.24
4,770
5.28
41.07
36.48
1.24
4,732
(6.1)%
9.9%
11.2%
0.8%
1.03%
0.86%
11.53%
12.90%
68.89%
1.14%
0.94%
14.11%
16.09%
66.20%
$1,814,885
397,079
$2,211,964
$1,775,452
466,913
$2,242,365
2.2%
(15.0)%
(1.4)%
High
Low
Dividends
$55.10
50.48
48.00
49.94
$46.30
43.90
39.41
41.21
$0.31
0.31
0.31
0.31
High
Low
Dividends
$50.17
43.01
41.51
52.65
$39.00
37.60
34.20
41.50
$0.31
0.31
0.31
0.31
Common Stock Market Prices and Dividends
Paid During Past Two Years:
December 31, 2024
4th Quarter
3rd Quarter
2nd Quarter
1st Quarter
December 31, 2023
4th Quarter
3rd Quarter
2nd Quarter
1st Quarter
2

2024 Annual Letter to Shareholders
Dear Shareholders,
We are pleased to report that 2024 was a meaningful year for Chemung Financial Corporation. Continued loan
growth, strong asset quality, and a record year from the Wealth Management Group all contributed to our success.
Strategic initiatives played a crucial role in our accomplishments. We significantly expanded our presence
in Western New York by opening a new regional banking center in Williamsville and launching the Canal Bank
brand. We continued to improve customer experience, both digitally and in-person, and focused on making our
operations more efficient.
Most importantly, we attained these results while staying true to the client-first, purpose-driven focus that defines
our community banking model.
Financial Performance
In 2024, Chemung Financial Corporation achieved net income of $23.7 million, or earnings of $4.96 per share.
Effective management of our net interest margin was critical to driving sustainable growth, and maintaining
robust liquidity ensured strength amid evolving market conditions. Our focus on this balance enabled us to deliver
strong results to our shareholders.
Year-over-year loan growth was strong, particularly in the commercial banking sector, where commercial and
industrial loans grew by more than 13 percent. Our Capital Bank division continued its pattern of significant
growth, with commercial loans exceeding $1.1 billion. This number is meaningful, with Capital Bank becoming
the first division in the Corporation to reach $1 billion in this portfolio. Through the end of the third quarter in
2024, Capital Bank ranked fifth out of 21 banks in the region based on year-over-year growth in commercial and
industrial loans, according to the Albany Business Review.
Net interest income for the year totaled $74.1 million, compared to $74.5 million in 2023, a decrease of $0.4 million,
or 0.5 percent. This decrease was primarily due to a 68-basis-point increase in interest paid on deposits, or $14.1
million, which included brokered deposits and deposit campaigns relating to certificates of deposit. This rise in
interest expense was somewhat offset by the average yield on commercial loans increasing 37 basis points, and
average yields on consumer loans and residential mortgages increasing 69 and 30 basis points respectively.
Asset quality continues to be strong as the ratio of non-performing loans to total loans remained at historically
low levels. Non-performing loans were $9.0 million at year end, or 0.43 percent of total loans, compared to $10.4
million, or 0.53 percent, at the end of 2023. With higher interest rates and a challenging economy, these numbers
speak to the durability of communities and our credit standards.
The Corporation   s primary generator of non-interest income is the Wealth Management Group (WMG). 2024 was
a record year for revenue and new business, with WMG   s fee income increasing $1.1 million year-over-year. The
increase in fee income was largely due to improvements in equity markets during 2024. Additionally, CFS Group,
Inc., the Corporation   s brokerage arm, surpassed $1 million in revenue, and new business revenues for the division
far exceeded expectations.
Strategic Initiatives
Growth in the Western New York region is a significant strategy of the Corporation. In 2024, we made meaningful
progress on this approach when we opened a new regional banking center in Williamsville and launched the
new Canal Bank brand. We recruited a Regional President for the division, as well as a strong team of seasoned
commercial and retail bankers. Loan and deposit growth in the region validated our strategy as balance sheet
growth exceeded expectations. We are strongly encouraged by the positive reaction the market has shown to our
brand and our style of relationship-based community banking.
Also in 2024, we evaluated our fee schedules across the lines of business. Our fees were compared closely
against the market and important peer institutions. The research revealed a significant opportunity to bring our
fees in-line with our competition, and we instituted new fee structures in most lines of business during the third
quarter while maintaining value for our clients. We expect these changes will account for significant additional
annual revenue for the bank going forward.
3

The Corporation continued to focus on customer experience in 2024. Although our names and brands differ
significantly, we operate seamlessly as one cohesive banking family to provide the best experience for our
customers. From a digital experience perspective, our goal was to provide our customers with a more unified and
frictionless experience by rebranding our platform to GoBanking     The Digital Experience at Chemung, Capital,
and Canal Banks. In 2025, we look forward to continuing the improvement of our digital platform by completing a
significant upgrade to our GoBanking suite of online and mobile banking services for consumers and businesses,
as well as a complete redesign of the Chemung Canal and Capital Bank websites. We believe these upgrades will
be a significant step forward in remaining competitive with elevated market standards and customer-experience
expectations.
Operational Efficiency
As always, the Corporation focused on expense containment and efficiencies throughout the year. We
maintained a steady headcount despite regional growth in Western New York and continued to evaluate our
branch distribution network to optimize costs. In 2024, we consolidated our Station Branch in Ithaca, realizing
significant cost savings with minimal client disruption and displacement. We remain judicious with our staffing
levels in the branch network as the industry trend of declining in-person transactions continues.
In addition to staffing levels and distribution channels, the Corporation assessed its primary vendor relationships
and outsourcing opportunities. After much research and thoughtful discussion, we began to outsource certain
administrative functions to enhance our risk environment and reduce cost. Further, we negotiated a renewal to
our contract with our core processor. These modifications will result in a meaningful reduction to non-interest
expense for years to come. Finally, we continue to utilize Robotic Process Automations (RPAs) to reduce repetitive
tasks and improve productivity. In 2024, our utilization of RPAs saved an estimated 7,200 hours in employee time.
These initiatives, along with many others, will positively impact our efficiency ratio, but not at the expense of
maintaining our commitment to a high level of customer experience.
Colleagues & Community
Commitment to our colleagues and our communities is a key priority. As discussed earlier, we managed our
staffing levels throughout the year to maximize client experience and improve efficiency. We continued to
invest in our teams by providing opportunities such as a mentoring program, educational programs, support for
professional development, and Career Circles, which facilitate peer-to-peer mentoring.
Additionally, the Bank remains consistent with its commitment to community-based organizations. We focus
on supporting not-for-profit organizations, schools, and groups that meet the basic needs of people, provide
financial literacy, and support economic growth. Last year, our employees proudly volunteered well over 13,000
hours, and we were pleased to invest nearly $600,000 into our communities through sponsorships and charitable
contributions.
Looking Ahead
We approach 2025 with confidence. The potential for favorable tax reform and more sensible regulatory oversight
is encouraging. Although the economic landscape continues to change quickly, we are secure in the resilience of
our franchise and the strength of our community banking model.
We will maintain our focus on key strategies to ensure consistent and sustainable performance: revenue growth,
operational efficiencies, enhancing customer experience, and supporting our colleagues and communities.
The Corporation is fortunate to have a dedicated and talented staff, as well as a seasoned Board of Directors to
provide guidance and leadership.
We appreciate the ongoing support of our shareholders, clients, employees, and the communities we serve, and
we look forward to delivering meaningful results in the coming year.
Anders M. Tomson
President & CEO
David J. Dalrymple
Chairman of the Board
4



 4/23/2025 Letter Continued (Full PDF)