Earnings release
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EXHIBIT 99.1 Chemung Financial Corporation Reports Third Quarter 2026 Net Income of $12.7 million, or $2.63 per share ELMIRA, N.Y., Oct. 22, 2026 (GLOBE NEWSWIRE) -- Chemung Financial Corporation (the “Corporation”) (Nasdaq:CHMG), the parent company of Chemung Canal Trust Company, National Association (the “Bank”), today reported netincome of $12.7 million, or $2.63 per share, for the third quarter of 2026, compared to net income of $8.8 million, or $1.82per share, for the second quarter of 2026, and net income of $7.8 million, or $1.62 per share, for the third quarter of 2025. "Third quarter results reflect the earnings power the Corporation has built through the strategic decisions of the past yearand the efforts of our team across each of our markets," said Anders M. Tomson, President and CEO of ChemungFinancial Corporation. "Steady commercial loan growth and disciplined management of funding costs continue to supportearnings as we navigate a dynamic interest rate environment," Tomson added. "Earlier this month, we completed our conversion to a national bank charter and announced our intent to unify our threedivisions under a single name, Canal Bank & Trust," said Tomson. "In recent years, our footprint has grown from our rootsin the Southern Tier to include the Capital Region and Western New York. Bringing those markets together under onebrand reflects who we have become as an organization, one team, delivering a consistent experience to every customer weserve. While our name will change, the values that have guided us since 1833 will not," concluded Tomson. Third Quarter 2026 Highlights: Net interest income increased $3.0 million, or 13.2%, and pre-provision net revenue increased $2.8 million, or 24.9%, in the third quarter of 2026, each compared to the same period in the prior year. 1 Year to date annualized loan growth totaled 7.7%, including annualized commercial loan growth of 11.7%. Year to date adjusted efficiency ratio was 58.83%, compared to 64.08% for the same period in the prior year, an improvement of 525 basis points. 1 Effective October 1, 2026, Chemung Canal Trust Company completed its previously announced charter conversionfrom a New York State trust company to a national bank, under the supervision of the Office of the Comptroller ofthe Currency (the "OCC"). Concurrent with the charter conversion, the Bank now operates under the name ChemungCanal Trust Company, National Association. In October, the Corporation announced its intent to unify the three existing divisional brands of Chemung CanalTrust Company, N.A., which include Capital Bank and Canal Bank, under a single name, Canal Bank & Trust, N.A.,to create a more consistent customer experience across its footprint. The rebranding will be introduced during thefourth quarter and rolled out across the footprint beginning in 2027. The Corporation announced a $0.02 per share increase in its quarterly dividend during the third quarter, representinga 5.9% increase over the prior quarter. Dividends declared during the third quarter of 2026 were $0.36 per share. 1 See the GAAP to Non-GAAP reconciliations. 3rd Quarter 2026 vs 2nd Quarter 2026 Net Interest Income: Net interest income for the third quarter of 2026 totaled $25.7 million, compared to $24.7 million for the prior quarter, anincrease of $1.0 million, or 4.0%, driven by an increase of $1.3 million in interest income on loans, partially offset byincreases of $0.1 million in both interest expense on deposits and interest expense on borrowed funds, and a decrease of$0.1 million in interest income on interest-earning deposits. Interest income on loans increased mainly due to an increase of $37.6 million in average balances of total loans and anincrease of six basis points in the average yield on total loans, each compared to the prior quarter. The increase in averagebalances of total loans was primarily the result of an increase of $41.4 million in average balances of commercial loans,which was concentrated in commercial real estate loans, driven by new origination activity and continued draws onconstruction loans. Average balances of residential mortgage loans increased $1.5 million, while average balances ofconsumer loans declined $5.2 million, each compared to the prior quarter. The decline in average balances of consumerloans was largely due to a decline in average balances of indirect auto loans, as paydowns and payoffs continued tooutpace new originations, partially offset by growth in average balances of home equity lines of credit.
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The average yield on total loans increased mainly due to an increase of six basis points in the average yield on commercialloans, as well as an increase of eight basis points in the average yield on consumer loans, each compared to the priorquarter. The average yield on residential mortgage loans was relatively in line with the prior quarter, increasing one basispoint. The increase in the average yield on commercial loans was primarily due to new balances continuing to beoriginated at higher interest rates relative to the portfolio’s average rate, the impact of interest rate resets on loansoriginated in the previous lower interest rate environment, and to the recognition of $0.2 million in prepayment penalties,deferred fees, and other fees associated with the payoff of two commercial real estate loans in the current quarter. The 25basis point increase in the Federal Funds Target Range Upper Limit ("Fed Funds" rate) toward the end of the currentquarter also had a positive impact on the average yield of commercial lines of credit, which mostly reprice on a daily basis.The increase in the average yield on consumer loans was largely due to repricing of prior promotional home equity lines ofcredit, which had carried below-market interest rates for one year following origination, to variable rates based on thePrime rate, partially offset by the origination of promotional lines in the current quarter. The average yield on consumerloans was also positively impacted by the increase in the Fed Funds rate. Interest expense on deposits increased mainly due to an increase of two basis points in the average cost of total interest-bearing deposits, compared to the prior quarter. The increase in the average cost of total interest-bearing deposits wasprimarily the result of an increase of five basis points in the average cost of savings and money market deposits, comparedto the prior quarter. The increase in the average cost of savings and money market deposits was largely due to rateadjustments on certain larger commercial relationships during the quarter, partially offset by lower average balances ofmunicipal insured cash sweep (ICS) deposits, which carry higher costs relative to other types of savings and money marketdeposits. Partially offsetting the overall increase in the average cost of interest-bearing deposits was a decrease of twobasis points in the average cost of customer time deposits compared to the prior quarter, largely due to maturities ofprevious higher-cost CD campaign offerings which were not renewed at maturity. Also offsetting the increase in interestexpense on deposits was a decline of $12.3 million in average balances of total interest-bearing deposits compared to theprior quarter, largely due to declines of $19.6 million and $14.6 million in average balances of customer time deposits andinterest-bearing demand deposits, respectively, partially offset by an increase of $15.9 million in average balances ofsavings and money market deposits. Interest expense on borrowed funds increased largely due to an increase of $9.2 million in average balances of totalborrowings compared to the prior quarter. The average cost of total borrowed funds decreased 15 basis points, as higher-cost subordinated debt comprised a smaller proportion of total borrowings compared to the prior quarter. Interest incomeon interest-earning deposits decreased primarily due to a decline of $9.6 million in average balances of interest-earningdeposits, compared to the prior quarter, as available cash was used to fund loan growth. Fully taxable equivalent net interest margin was 3.74% for the current quarter, compared to 3.67% for the prior quarter.Average interest-earning assets increased $25.5 million while average interest-bearing liabilities decreased $3.0 million,each compared to the prior quarter. The average yield on interest-earning assets increased seven basis points to 5.25%, andthe average cost of interest-bearing liabilities increased three basis points to 2.30%, each compared to the prior quarter.Total cost of funds was 1.67% for the current quarter, in line with the prior quarter. Provision for Credit Losses: Provision for credit losses was a credit of $2.6 million for the third quarter of 2026, compared to provision expense of $0.6million for the prior quarter, a decrease of $3.2 million. The decrease was primarily due to a $2.9 million partial recoveryof a commercial and industrial loan participation, received in connection with the settlement of related litigation during thecurrent quarter, resulting in total net recoveries of $2.6 million in the current quarter, compared to net charge-offs of $0.2million in the prior quarter. Also contributing to the decrease were improvements in FOMC forecasts for nationalunemployment and GDP growth and improvements in modeled prepayment speeds. Non-Interest Income: Non-interest income for the third quarter of 2026 totaled $6.3 million, compared to $6.5 million for the prior quarter, adecrease of $0.2 million, or 3.1%, driven by a decrease of $0.3 million in the change in fair value of equity investments,partially offset by an increase of $0.2 million in other non-interest income. The decrease in the change in fair value ofequity investments was largely due to a decline in the market value of the Corporation's deferred compensation plan in thecurrent quarter, compared to an increase in the prior quarter. The increase in other non-interest income was largely due tohigher incentive income recognized under a debit card network agreement in the current quarter. Non-Interest Expense: Non-interest expense for the third quarter of 2026 totaled $18.1 million, compared to $19.3 million for the prior quarter, adecrease of $1.2 million, or 6.2%, driven by decreases of $0.4 million in other non-interest expense, $0.3 million inmarketing and advertising, and $0.2 million in each of professional services, loan expense, and pension and otheremployee benefits, partially offset by an increase of $0.2 million in salaries and wages. Other non-interest expensedecreased primarily due to a $0.3 million write-down of a legacy non-marketable equity investment in the prior quarter.
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Marketing and advertising decreased largely due to elevated costs in the prior quarter associated with television advertisingand the launch of a business banking campaign. Professional services decreased mainly due to tax services performed forthe Corporation's Wealth Management Group and legal services related to the Bank's charter conversion recognized in theprior quarter. Loan expense decreased largely due to lower legal expenses associated with litigation that was settled duringthe current quarter. Pension and other employee benefits decreased mainly due to the timing of employee healthcare-related expenses. Salaries and wages increased primarily due to an increase in incentive-based compensation and expenserecognized on the accelerated vesting of restricted stock grants for employee retirements during the current quarter,partially offset by a decrease in expense relating to the Corporation's deferred compensation plan as a result of the decreasein the market value of the plan during the current quarter, compared to an increase in the prior quarter. Income Tax Expense: Income tax expense for the third quarter of 2026 was $3.8 million, compared to $2.5 million for the prior quarter, anincrease of $1.3 million. The increase in income tax expense was primarily due to an increase in pre-tax income comparedto the prior quarter, including the $0.8 million income tax impact from the recovery of credit losses following the litigationsettlement in the current quarter. The effective tax rate for the current quarter was 23.0%, compared to 22.0% for the priorquarter. 3rd Quarter 2026 vs 3rd Quarter 2025 Net Interest Income: Net interest income for the third quarter of 2026 totaled $25.7 million, compared to $22.7 million for the same period inthe prior year, an increase of $3.0 million, or 13.2%, driven by an increase of $3.1 million in interest income on loans anda decrease of $1.3 million in interest expense on deposits, partially offset by a decrease of $0.9 million in interest incomeon interest-earning deposits and an increase of $0.6 million in interest expense on borrowed funds. Interest income on loans increased mainly due to an increase of $204.6 million in average balances of total loans and anincrease of two basis points in the average yield on total loans, compared to the same period in the prior year. The increasein average balances of total loans was primarily the result of an increase in the average balances of commercial loans, witha smaller increase attributable to residential mortgage loans, partially offset by a decrease in average balances of consumerloans. Average balances of total commercial loans increased $221.1 million compared to the same period in the prior year,with growth largely attributable to the Corporation’s Canal Bank and Capital Bank divisions. Average balances ofresidential mortgage loans increased $9.5 million compared to the same period in the prior year, mainly due to originationactivity during the fourth quarter of 2025 and year to date in 2026, and the retention of more originated balances forinvestment. Average balances of consumer loans declined $26.1 million compared to the same period in the prior year,primarily due to a decline in average balances of indirect auto loans, as the Corporation continued to prioritize other typesof lending throughout 2025 and year to date in 2026. Increases of six and 12 basis points in the average yields on residential mortgage loans and consumer loans, respectively,were mostly offset by a decrease of two basis points in the average yield on commercial loans, each compared to the sameperiod in the prior year. The increase in the average yield on residential mortgage loans was largely due to yields onmortgages originated since the prior year period generally being higher than the portfolio’s average yield, despite therecognition of interest income on the payoff of a nonaccrual loan and deferred fees on the payoff of several larger loans inthe prior year period. The increase in the average yield on consumer loans was largely due to the repricing of priorpromotional home equity lines of credit from below-market introductory rates, partially offset by a lower average Primerate in the current year period compared to the same period in the prior year. The decrease in the average yield oncommercial loans was largely due to lower interest rates on variable rate commercial loans, as cumulative decreases of 75basis points in the Fed Funds rate between September and December 2025 were only partially offset by the 25 basis pointincrease in September 2026. Partially offsetting the decrease were new balances originated at interest rates above theportfolio’s average rate, and the recognition of $0.2 million in prepayment penalties, deferred fees, and other feesassociated with the payoff of two commercial real estate loans in the current year period. Interest expense on deposits decreased primarily due to a decrease of 28 basis points in the average cost of total interest-bearing deposits, and a decline of $28.4 million in average balances of total interest-bearing deposits, each compared to thesame period in the prior year. The decrease in the average cost of total interest-bearing deposits was largely due todecreases of 37 and 18 basis points in the average cost of customer time deposits and savings and money market deposits,respectively, compared to the same period in the prior year. Average balances of customer time deposits also decreased$75.2 million compared to the same period in the prior year. The decreases in the average cost and average balances ofcustomer time deposits were largely the result of the discontinuation of longer-term, higher-cost promotions in the secondhalf of 2025 in favor of shorter-term offerings, resulting in many previous promotional CDs not being renewed at maturity.Customer time deposits comprised 18.3% of total average deposits during the third quarter of 2026, compared to 21.7%during the same period in the prior year. The decrease in the average cost of savings and money market deposits wasmainly due to targeted reductions in tiered interest rates offered on money market deposits in the fourth quarter of 2025and the first quarter of 2026 as market interest rates declined. Partially offsetting the decrease in interest expense on
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deposits was an increase of $66.4 million in average balances of savings and money market deposits, compared to thesame period in the prior year, more than half of which was concentrated in the Corporation's Canal Bank division. Interest income on interest-earning deposits decreased primarily due to declines of $74.5 million in average balances and69 basis points in the average yield on interest-earning deposits, each compared to the same period in the prior year.Average balances of interest-earning deposits decreased mostly as a result of the Corporation utilizing cash proceeds fromthe sale of available for sale securities and the issuance of subordinated debt in 2025 to fund loan growth and pay offwholesale funding liabilities in the second half of 2025. The decrease in the average yield on interest-earning deposits waslargely due to the cumulative decreases of 75 basis points in the Fed Funds rate between September and December 2025,partially offset by the 25 basis point increase in September 2026. Interest expense on borrowed funds increased largely due to an increase of $61.1 million in average balances of totalborrowed funds, partially offset by a decrease of 181 basis points in the average cost of total borrowed funds, eachcompared to the same period in the prior year. The increase in average balances of total borrowed funds was primarily dueto an increase of $55.9 million in average balances of term advances and other debt, reflecting increased utilization ofFHLBNY advances to fund loan growth following the deployment of excess cash in the second half of 2025. The decreasein the average cost of total borrowed funds was primarily due to subordinated debt comprising a smaller proportion of totalborrowings in the current year period, as well as a decrease of 49 basis points in the average cost of term advances andother debt, as a result of the relatively lower market interest rate environment compared to the same period in the prioryear. Fully taxable equivalent net interest margin was 3.74% for the third quarter of 2026, compared to 3.45% for the sameperiod in the prior year. Average interest-earning assets increased $114.4 million and average interest-bearing liabilitiesincreased $32.7 million, each compared to the same period in the prior year. The average yield on interest-earning assetsincreased ten basis points to 5.25%, while the average cost of interest-bearing liabilities decreased 21 basis points to2.30%, each compared to the same period in the prior year. Total cost of funds was 1.67% for the current quarter,compared to 1.85% for the same period in the prior year, a decrease of 18 basis points. Provision for Credit Losses: Provision for credit losses was a credit of $2.6 million for the third quarter of 2026, compared to provision expense of $1.1million for the same period in the prior year, a decrease of $3.7 million. The decrease was primarily due to a $2.9 millionpartial recovery of a commercial and industrial loan participation received in connection with the settlement of relatedlitigation during the current year period, which resulted in net recoveries of $2.6 million for the third quarter of 2026,compared to net charge-offs of $0.1 million for the same period in the prior year. Also contributing to the decrease waslower loan growth in the current year period, which totaled $33.9 million, compared to growth of $69.9 million during thesame period in the prior year, as well as favorable changes in model inputs in the current year period, includingimprovements in FOMC forecasts for national unemployment and GDP growth and in modeled prepayment speeds. Non-Interest Income: Non-interest income for the third quarter of 2026 was $6.3 million, compared to $6.1 million for the same period in theprior year, an increase of $0.2 million, or 3.3%, driven by increases of $0.3 million in other non-interest income and $0.2million in wealth management group fee income, partially offset by a decrease of $0.2 million in the change in fair valueof equity investments. The increase in other non-interest income was largely due to higher incentive income recognizedunder a debit card network agreement in the current quarter, as well as an increase in commission income attributable tothe Corporation's CFS Group. Wealth management group fee income increased mainly due to an increase in the marketvalue of assets under management, excluding assets under management or administration for the Corporation, of 4.4%compared to September 30, 2025, largely due to improvements in financial markets between the third quarters of 2025 and2026. The decrease in the change in fair value of equity investments was mostly due to a decrease in the market value ofthe Corporation's deferred compensation plan in the current year period, compared to an increase in the same period in theprior year. Non-Interest Expense: Non-interest expense for the third quarter of 2026 was $18.1 million, compared to $17.6 million for the same period in theprior year, an increase of $0.5 million, or 2.8%, driven by increases of $0.3 million in salaries and wages and $0.1 millionin professional services, partially offset by a decrease of $0.2 million in pension and other employee benefits. Salaries andwages increased mainly due to annual merit-based increases in base salaries and an increase in incentive-basedcompensation, partially offset by a decrease in expense relating to the Corporation's deferred compensation plan as a resultof the decrease in the market value of the plan during the current year period, as well as higher expense recognized in theprior year period on the accelerated vesting of restricted stock grants for employees retiring during that period.Professional services increased primarily due to an increase in consulting services in support of corporate initiativescompared to the same period in the prior year. Pension and other employee benefits decreased largely due to the timing ofemployee healthcare-related expenses.
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Income Tax Expense: Income tax expense for the third quarter of 2026 was $3.8 million, compared to $2.3 million for the same period in theprior year, an increase of $1.5 million. The increase in income tax expense was primarily due to an increase in pre-taxincome, including the $0.8 million income tax impact from the recovery of credit losses following the litigation settlementin the current quarter. The effective tax rate for the current quarter was 23.0%, compared to 22.6% for the same period inthe prior year. Asset QualityNon-performing loans totaled $13.8 million, or 0.57% of total loans, as of September 30, 2026, compared to $7.9 million,or 0.35% of total loans, as of December 31, 2025. The increase was primarily due to $7.9 million in commercial loansbeing placed into non-performing status during the nine months ended September 30, 2026, including one commercial andindustrial loan with a balance of $2.2 million and three non-owner occupied commercial real estate loans from tworelationships with balances totaling $5.3 million. These additions were partially offset by the transfer of $2.0 million incommercial real estate loans to other real estate owned, net of $0.3 million in related charge-offs, the payoff of twononaccrual commercial real estate loans totaling $0.6 million, and a $1.1 million net decrease in other non-performingcommercial loans during the nine months ended September 30, 2026. Non-performing retail loans increased $1.7 millioncompared to December 31, 2025, driven by the addition of one residential mortgage with a balance of $0.8 million and onehome equity loan with a balance of $0.5 million, as well as a $0.4 million net increase in other non-performing retail loans. Non-performing assets totaled $16.1 million, or 0.56% of total assets, as of September 30, 2026, compared to $8.2 million,or 0.30% of total assets, as of December 31, 2025. In addition to $13.8 million in non-performing loans, non-performingassets include other real estate owned and repossessed vehicles. There was $1.9 million in other real estate owned as ofSeptember 30, 2026, all of which was obtained during the first quarter of 2026, including four properties with a fair valueof $1.7 million relating to one commercial relationship. Repossessed vehicles were $0.4 million as of September 30, 2026,compared to $0.3 million as of December 31, 2025. Delinquent loans, inclusive of delinquent non-performing loans, totaled $11.2 million, or 0.47% of total loans, as ofSeptember 30, 2026, relatively consistent with $11.2 million in delinquent loans, or 0.49% of total loans, as of December31, 2025. The change in the composition of total delinquent loans was mostly due to the transfer of balances associatedwith two commercial real estate loans to other real estate owned, totaling $2.0 million, net of related charge-offs.Offsetting this decrease were increases of $0.8 million in other delinquent commercial real estate loans and $0.9 million indelinquent commercial and industrial loans. Total delinquent retail loans increased $0.4 million, driven by increases of$0.9 million in delinquent home equity lines and loans and $0.6 million in delinquent residential mortgage loans, partiallyoffset by a $1.1 million decrease in indirect consumer loan delinquencies. Annualized net recoveries for the nine months ended September 30, 2026, totaled 0.14%, compared to net charge-offs of0.08% for the nine months ended September 30, 2025, a decrease of 22 basis points. The net recovery rate in the currentyear period was mostly due to the recovery of $2.9 million in previous commercial and industrial loan charge-offs as theresult of a legal settlement, as well as a separate $0.7 million recovery of a previously charged-off commercial andindustrial loan. Consumer loan net charge-offs for the nine months ended September 30, 2026, were 0.38% of averageconsumer loan balances, annualized, while commercial loans and residential mortgage loans each had net recovery ratesduring the current year period. Annualized net recoveries for the third quarter of 2026 totaled 0.43%, compared to netcharge-offs of 0.03% for the prior quarter and 0.02% for the third quarter of 2025, decreases of 46 and 45 basis points,respectively. The decrease in the net charge-off rate compared to both periods was largely due to the $2.9 million recoveryrecognized in the current quarter following a legal settlement. Consumer loan net charge-offs for the third quarter of 2026were 0.35% of average consumer loans, while commercial loans and residential mortgage loans each had net recoveryrates during the current quarter. The allowance for credit losses on loans was $25.2 million as of September 30, 2026, compared to $24.2 million as ofDecember 31, 2025. The allowance for credit losses on unfunded commitments, a component of other liabilities, was $0.6million as of both September 30, 2026 and December 31, 2025. The increase in the allowance for credit losses on loanswas driven by $1.4 million in specific reserve allocations made during the first nine months of 2026, including $1.2million in allocations on one non-owner occupied commercial real estate loan. Commercial real estate loan growth alsocontributed to the overall increase in the allowance. Partially offsetting the overall increase were lower modeled loss rates,reflecting the annual update to the Corporation's CECL model, which is implemented in the first quarter each year, andimproved economic forecasts and modeled prepayment speeds, as well as lower consumer loan balances. The ratio of theallowance for credit losses on loans to total loans was 1.05% as of September 30, 2026, compared to 1.07% as ofDecember 31, 2025, a decrease of two basis points, while the allowance for credit losses on loans was 182.73% of non-performing loans as of September 30, 2026, compared to 306.13% as of December 31, 2025. Balance Sheet ActivityTotal assets were $2.851 billion as of September 30, 2026, compared to $2.710 billion as of December 31, 2025, anincrease of $141.1 million, or 5.2%. This increase was driven by increases of $131.5 million in loans, net of deferred
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origination costs, $21.7 million in total cash and cash equivalents, and $14.2 million in accrued interest receivable andother assets, partially offset by a decrease of $27.2 million in securities available for sale. Loans, net of deferred origination costs, increased due to an increase of $151.6 million in total commercial loans, partiallyoffset by a decrease of $20.6 million in consumer loans, each compared to prior year-end. Residential mortgage loans wererelatively in line with prior year-end. The increase in total commercial loans was mainly due to increases in non-owneroccupied commercial real estate loans and construction loans, along with a smaller increase in owner occupied commercialreal estate loans, each compared to prior year-end. The Corporation's Canal Bank division was responsible for the largestportion of the increase in total commercial loans, contributing $90.2 million to the overall increase, followed by theCapital Bank division, contributing $70.8 million. Consumer loans decreased primarily due to net runoff of indirect auto loans, as the Corporation continues prioritizing othertypes of lending. Partially offsetting the decrease in consumer loans was an increase in home equity lines and loans,mainly the result of a home equity line campaign that began in the second quarter of 2026. Residential mortgage loanorigination levels continued to be negatively impacted by the current interest rate environment and housing marketconditions. Cash and cash equivalents increased primarily due to an increase of $114.6 million in total deposits and $15.6 million inpaydowns and maturities of securities available for sale, each compared to prior year-end, and net cash provided byoperating activities, largely offset by an increase of $131.5 million in loans, net of deferred origination costs, compared toprior year-end. Accrued interest receivable and other assets increased mainly due to an increase of $10.6 million in interestrate swap assets, mainly due to changes in market interest rates compared to prior year-end. Securities available for saledecreased largely due to a decrease in the fair value of securities of $11.2 million compared to prior year-end, mostly dueto increases in market interest rates compared to prior year-end, as well as year to date net paydowns and maturitiestotaling $15.6 million. Total liabilities were $2.578 billion as of September 30, 2026, compared to $2.456 billion as of December 31, 2025, anincrease of $122.3 million, or 5.0%. This increase was driven by increases of $114.6 million in total deposits and $9.1million in accrued interest payable and other liabilities. The increase in total deposits reflected growth of $74.7 million in total interest-bearing deposits and $39.8 million in noninterest-bearing deposits, each compared to prior year-end. Growth in interest-bearing deposits was attributable to inflowsof municipal and commercial deposits, partially offset by a decline in interest-bearing consumer deposits. Inflows ofmoney market deposits contributed the majority of the increase in total interest-bearing deposits, increasing $101.7 millioncompared to prior year-end, and included inflows of commercial money market deposits. Also contributing to the increasein total interest-bearing deposits was an increase of $8.9 million in interest-bearing demand deposits, largely due toseasonal inflows of municipal deposits. Time deposits and savings deposits decreased $23.7 million and $12.1 million,respectively. The decrease in time deposits was largely due to previous CD campaign specials which matured and were notrenewed. In the third quarter of the current year, the Corporation introduced a new CD campaign, partially in response torecent increases in market interest rates. The decrease in savings deposits reflected outflows from both commercial andmunicipal customers. Growth in non interest‐bearing deposits primarily reflected inflows from commercial customers, as well as smaller inflowsfrom consumer and municipal customers. Non interest-bearing deposits comprised 27.9% and 27.5% of total deposits as ofSeptember 30, 2026 and December 31, 2025, respectively. The increase in accrued interest payable and other liabilitieswas mainly due to an increase of $10.6 million in interest rate swap liabilities, largely due to changes in market interestrates compared to prior year-end. Total shareholders’ equity was $273.5 million as of September 30, 2026, compared to $254.7 million as of December 31,2025, an increase of $18.8 million, or 7.4%, driven by an increase of $25.7 million in retained earnings, mostly due to netincome for the nine months ended September 30, 2026, totaling $30.7 million, partially offset by dividends declared of$5.0 million during the nine months ended September 30, 2026. Partially offsetting the increase in total shareholders'equity was an increase of $8.2 million in accumulated other comprehensive loss, mostly due to the negative impact ofinterest rate changes compared to prior year-end on the market value of the Corporation's available for sale securities. The total equity to total assets ratio was 9.59% as of September 30, 2026, compared to 9.40% as of December 31, 2025,and the tangible equity to tangible assets ratio was 8.90% as of September 30, 2026, compared to 8.66% as of December 31, 2025.1 Book value per share and tangible book value per share increased to $56.51 and $52.00, respectively, as of September 30, 2026, from $52.97 and $48.43, respectively, as of December 31, 2025.1 As of September 30, 2026, the Bank’s capital ratios were in excess of those required to be considered well-capitalized under the regulatory framework forprompt corrective action. 1 See the GAAP to Non-GAAP reconciliations.
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Wealth Management Group and CFS GroupThe market value of total assets under management or administration in our Wealth Management Group was $2.280 billionas of September 30, 2026, including $132.8 million of assets under management or administration for the Corporation,compared to $2.338 billion as of December 31, 2025, including $301.8 million of assets under management oradministration for the Corporation, a decrease of $58.0 million, or 2.5%. The decrease in Wealth Management Groupassets under management or administration was largely due to the transition of the administration of the Corporation'ssecurities pledged as collateral for municipal deposits, which were previously reported by the Wealth Management Groupas a component of assets under management, during the third quarter of 2026. Excluding assets under management or administration for the Corporation, the total market value of Wealth ManagementGroup assets increased $111.0 million, or 5.5%, largely due to improvements in financial markets during the first ninemonths of 2026, compared to conditions as of December 31, 2025. Total fee income attributable to the WealthManagement Group for the nine months ended September 30, 2026 was $9.5 million, compared to $8.8 million for thesame period in the prior year, an increase of $0.7 million, or 8.0%. As of September 30, 2026, CFS Group had total client assets of $303.4 million, including $115.5 million of advisory assetsunder management, compared to client assets of $299.4 million, including $104.1 million of advisory assets undermanagement, as of December 31, 2025, an increase of $4.0 million in total client assets and $11.4 million in advisoryassets. Total CFS Group fee and commission income for the nine months ended September 30, 2026 was $1.3 million,compared to $0.8 million for the same period in the prior year, an increase of $0.5 million, or 62.5%. The increase in totalCFS Group fee and commission income was largely due to recognition of additional income in the current year periodfollowing contractual changes to a broker-dealer agreement, improvements in financial markets during the first ninemonths of 2026, and organic client growth across the Corporation's footprint. LiquidityThe Corporation uses a variety of resources to manage its liquidity, and management believes it has the necessary liquidityto allow for flexibility in meeting its various operational and strategic needs. These include short-term investments, cashflow from lending and investing activities, core-deposit growth, and non-core funding sources, such as time deposits of$250,000 or greater, brokered deposits, FHLBNY overnight and term advances, and FRB advances. Borrowings may beused on a short-term basis for liquidity purposes or on a long-term basis to fund asset growth. As of September 30, 2026, the Corporation's cash and cash equivalents balance was $71.8 million. Following the sale of asignificant portion of available for sale securities in the prior year, the Corporation continues to maintain an investmentportfolio of securities available for sale, consisting of government-sponsored entity mortgage-backed securities andcollateralized mortgage obligations, municipal bonds, and corporate bonds. Although this portfolio generates interestincome for the Corporation, it also serves as an available source of liquidity if needed. As of September 30, 2026, theCorporation's investment in securities available for sale was $253.4 million, $60.1 million of which was not pledged ascollateral. Additionally, as of September 30, 2026, the Bank's total advance line capacity at the Federal Home Loan Bankof New York was $178.6 million, $85.0 million of which was utilized and $93.6 million of which was available. FHLBNYadvances as of September 30, 2026 consisted of multiple short-term advances, with all advances maturing by November2026. Also available to the Corporation is the FRB's Discount Window Lending program, at which $6.9 million inborrowing capacity was available as of September 30, 2026. As of September 30, 2026, uninsured deposits totaled $797.5 million, or 33.4% of total deposits, including $211.0 millionof municipal deposits collateralized by pledged assets, when required. As of December 31, 2025, uninsured depositstotaled $682.5 million, or 30.1% of total deposits, including $161.4 million of municipal deposits collateralized by pledgedassets, when required. Due to their fluidity, the Corporation closely monitors uninsured deposit levels when consideringliquidity management strategies. The Corporation had no outstanding brokered deposits as of either September 30, 2026 or December 31, 2025. TheCorporation may use brokered deposits in the future to fund asset growth or as an additional source of liquidity in supportof ongoing operations. Other ItemsAs previously announced on January 8, 2021, the Corporation's Board of Directors approved a stock repurchase program.Under the repurchase program, the Corporation may repurchase up to 250,000 shares of its common stock, orapproximately 5% of its then outstanding shares. The repurchase program permits shares to be repurchased in open marketor privately negotiated transactions, through block trades, and pursuant to any trading plan that may be adopted inaccordance with Rule 10b5-1 of the Securities Exchange Act of 1934. As of September 30, 2026, a total of 49,184 sharesof common stock at a total cost of $2.0 million were repurchased by the Corporation under its share repurchase program.No shares were repurchased in the third quarter of 2026. The weighted average cost was $40.42 per share repurchased.Remaining buyback authority under the share repurchase program was 200,816 shares as of September 30, 2026. About Chemung Financial CorporationChemung Financial Corporation is a $2.9 billion financial services holding company headquartered in Elmira, New York
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and operates 30 retail offices through its principal subsidiary, Chemung Canal Trust Company, National Association, a fullservice community bank with trust powers. Established in 1833, Chemung Canal Trust Company is the oldest locally-owned and managed community bank in New York State. Chemung Financial Corporation is also the parent of CFSGroup, Inc., a financial services subsidiary offering non-traditional services including mutual funds, annuities, brokerageservices, tax preparation services, and insurance. This press release may be found at: www.chemungcanal.com under Investor Relations. Forward-Looking StatementsThis press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act,Section 21E of the Securities Exchange Act, and the Private Securities Litigation Reform Act of 1995. The Corporationintends its forward-looking statements to be covered by the safe harbor provisions for forward-looking statements in thispress release. All statements regarding the Corporation's expected financial position and operating results, theCorporation's business strategy, the Corporation's financial plans, forecasted demographic and economic trends relating tothe Corporation's industry and similar matters are forward-looking statements. These statements can sometimes beidentified by the Corporation's use of forward-looking words such as "may," "will," "anticipate," "estimate," "expect," or"intend." The Corporation cannot guarantee that its expectations in such forward-looking statements will turn out to becorrect. The Corporation's actual results could be materially different from expectations because of various factors,including changes in economic conditions or interest rates, credit risk, inflation, tariffs, cybersecurity risks, changes inFDIC assessments, bank failures, difficulties in managing the Corporation’s growth, competition, geopolitical conflicts,changes in law or the regulatory environment, and changes in general business and economic trends. Information concerning these and other factors, including Risk Factors, can be found in the Corporation’s periodic filingswith the Securities and Exchange Commission (“SEC”), including the 2025 Annual Report on Form 10-K. These filingsare available publicly on the SEC's website at http://www.sec.gov, on the Corporation's website athttp://www.chemungcanal.com or upon request from the Corporate Secretary at (607) 737-3746. Except as otherwiserequired by law, the Corporation undertakes no obligation to publicly update or revise its forward-looking statements,whether as a result of new information, future events, or otherwise. Chemung Financial Corporation Consolidated Balance Sheets(Unaudited) Sept. 30, June 30, March 31, Dec. 31, Sept. 30, (in thousands) 2026 2026 2026 2025 2025 ASSETS Cash and due from financialinstitutions $ 32,928 $ 28,994 $ 27,679 $ 22,772 $ 32,445 Interest-earning deposits in otherfinancial institutions 38,911 44,119 25,691 27,325 75,201 Total cash and cash equivalents 71,839 73,113 53,370 50,097 107,646 Equity investments 3,668 3,605 3,776 3,765 3,616 Securities available for sale 253,429 269,043 275,318 280,598 280,514 Securities held to maturity 1,560 1,560 640 640 680 FHLB and FRB stock, at cost 9,554 9,690 8,964 9,466 5,524 Total investment securities 264,543 280,293 284,922 290,704 286,718 Commercial 1,885,503 1,845,751 1,786,541 1,733,912 1,671,261 Residential mortgage 287,300 286,875 285,990 286,885 277,729 Consumer 228,209 234,525 239,174 248,764 253,366 Loans, net of deferred loan fees 2,401,012 2,367,151 2,311,705 2,269,561 2,202,356 Allowance for credit losses (25,213) (25,232) (24,890) (24,209) (23,645) Loans, net 2,375,799 2,341,919 2,286,815 2,245,352 2,178,711 Loans held for sale 2,458 2,427 2,708 2,102 3,075 Premises and equipment, net 15,082 14,887 15,050 15,401 15,376 Operating lease right-of-use assets 5,649 5,242 5,485 4,755 4,943 Goodwill 21,824 21,824 21,824 21,824 21,824 Accrued interest receivable andother assets 90,478 76,892 74,772 76,235 74,725
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Total assets $ 2,851,340 $ 2,820,202 $ 2,748,722 $ 2,710,235 $ 2,696,634 LIABILITIES ANDSHAREHOLDERS' EQUITY Deposits: Non interest-bearing demanddeposits $ 664,375 $ 681,912 $ 641,039 $ 624,532 $ 633,216 Interest-bearing demand deposits 335,562 312,521 331,114 326,645 356,271 Money market deposits 703,094 680,752 632,729 601,391 652,289 Savings deposits 242,351 256,375 251,073 254,490 231,905 Time deposits 439,867 432,374 457,941 463,616 484,835 Total deposits 2,385,249 2,363,934 2,313,896 2,270,674 2,358,516 Advances and other debt 88,173 92,855 79,066 90,554 3,530 Subordinated debt, net of deferredissuance costs 44,105 44,079 44,054 44,028 44,002 Operating lease liabilities 5,846 5,440 5,679 4,937 5,124 Accrued interest payable and otherliabilities 54,455 43,533 43,098 45,333 40,154 Total liabilities 2,577,828 2,549,841 2,485,793 2,455,526 2,451,326 Shareholders' equity Common stock 53 53 53 53 53 Additional paid-in capital 50,119 49,638 49,194 49,547 49,027 Retained earnings 282,187 271,216 264,044 256,484 250,373 Treasury stock, at cost (14,598) (14,601) (14,638) (15,322) (15,069) Accumulated other comprehensiveloss (44,249) (35,945) (35,724) (36,053) (39,076) Total shareholders' equity 273,512 270,361 262,929 254,709 245,308 Total liabilities andshareholders' equity $ 2,851,340 $ 2,820,202 $ 2,748,722 $ 2,710,235 $ 2,696,634 Period-end shares outstanding 4,840 4,838 4,837 4,809 4,812 Chemung FinancialCorporation Consolidated Statements ofIncome (Unaudited) Three Months EndedSeptember 30, PercentChange Nine Months EndedSeptember 30, PercentChange(in thousands, except per sharedata) 2026 2025 2026 2025 Interest and dividend income: Loans, including fees $ 34,093 $ 31,033 9.9 $ 98,436 $ 88,567 11.1 Taxable securities 1,698 1,653 2.7 5,051 7,206 (29.9) Tax exempt securities 89 80 11.3 241 545 (55.8) Interest-earning deposits 239 1,118 (78.6) 867 2,298 (62.3) Total interest and dividendincome 36,119 33,884 6.6 104,595 98,616 6.1 Interest expense: Deposits 8,824 10,171 (13.2) 26,066 32,403 (19.6) Borrowed funds 1,621 1,025 58.1 4,601 2,900 58.7 Total interest expense 10,445 11,196 (6.7) 30,667 35,303 (13.1)
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Net interest income 25,674 22,688 13.2 73,928 63,313 16.8 Provision (credit) for creditlosses (2,602) 1,064 N/M (1,440) 3,301 (143.6) Net interest income afterprovision for credit losses 28,276 21,624 30.8 75,368 60,012 25.6 Non-interest income: Wealth management group feeincome 3,148 2,967 6.1 9,484 8,827 7.4 Service charges on depositaccounts 1,065 1,094 (2.7) 3,154 3,328 (5.2) Interchange revenue from debitcard transactions 1,094 1,073 2.0 3,215 3,220 (0.2) Net (losses) on securitiestransactions — — 0.0 — (17,498) N/M Change in fair value of equityinvestments (41) 136 (130.1) 160 197 (18.8) Net gains on sales of loans heldfor sale 41 78 (47.4) 109 169 (35.5) Net gains (losses) on sales ofother real estate owned — — 0.0 — (8) N/M Income from bank owned lifeinsurance 7 8 (12.5) 21 24 (12.5) Other 993 732 35.7 2,987 3,013 (0.9) Total non-interest income 6,307 6,088 3.6 19,130 1,272 N/M Non-interest expense: Salaries and wages 8,203 7,925 3.5 23,840 22,713 5.0 Pension and other employeebenefits 2,124 2,298 (7.6) 6,532 6,332 3.2 Other components of net periodicpension and postretirementbenefits (127) (113) (12.4) (411) (339) (21.2) Net occupancy 1,441 1,371 5.1 4,515 4,335 4.2 Furniture and equipment 503 399 26.1 1,410 1,227 14.9 Data processing 2,576 2,534 1.7 7,727 7,631 1.3 Professional services 782 636 23.0 2,435 2,079 17.1 Marketing and advertising 150 203 (26.1) 888 893 (0.6) Other real estate owned expense 1 8 (87.5) 26 22 18.2 FDIC insurance 302 352 (14.2) 921 1,225 (24.8) Loan expense 286 262 9.2 1,078 836 28.9 Other 1,833 1,770 3.6 5,896 5,387 9.4 Total non-interest expense 18,074 17,645 2.4 54,857 52,341 4.8 Income before income taxexpense 16,509 10,067 64.0 39,641 8,943 N/M Income tax expense 3,802 2,275 67.1 8,925 1,580 N/M Net income $ 12,707 $ 7,792 63.1 $ 30,716 $ 7,363 N/M Basic and diluted earnings pershare $ 2.63 $ 1.62 $ 6.36 $ 1.53 Cash dividends declared pershare $ 0.36 $ 0.34 $ 1.04 $ 0.98 Average basic and diluted sharesoutstanding 4,839 4,811 4,833 4,802 N/M - Not Meaningful
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ChemungFinancialCorporation As of or for the Three Months Ended As of or for theNine Months Ended ConsolidatedFinancialHighlights(Unaudited) Sept. 30, June 30, March 31, Dec. 31, Sept. 30, Sept. 30, Sept. 30, (in thousands,except per sharedata) 2026 2026 2026 2025 2025 2026 2025 RESULTS OFOPERATIONS Interest income $ 36,119 $ 34,891 $ 33,585 $ 34,219 $ 33,884 $ 104,595 $ 98,616 Interest expense 10,445 10,221 10,001 10,375 11,196 30,667 35,303 Net interest income 25,674 24,670 23,584 23,844 22,688 73,928 63,313 Provision (credit)for credit losses (2,602) 561 601 1,136 1,064 (1,440) 3,301 Net interest incomeafter provision forcredit losses 28,276 24,109 22,983 22,708 21,624 75,368 60,012 Non-interestincome 6,307 6,503 6,320 6,673 6,088 19,130 1,272 Non-interestexpense 18,074 19,321 17,462 18,388 17,645 54,857 52,341 Income beforeincome tax expense 16,509 11,291 11,841 10,993 10,067 39,641 8,943 Income taxexpense 3,802 2,481 2,642 3,252 2,275 8,925 1,580 Net income $ 12,707 $ 8,810 $ 9,199 $ 7,741 $ 7,792 $ 30,716 $ 7,363 Basic and dilutedearnings per share $ 2.63 $ 1.82 $ 1.91 $ 1.61 $ 1.62 $ 6.36 $ 1.53 Average basic anddiluted sharesoutstanding 4,839 4,838 4,825 4,811 4,811 4,833 4,802 PERFORMANCERATIOS Return on averageassets 1.80% 1.27% 1.36% 1.14% 1.15% 1.48% 0.36% Return on averageequity 18.36% 13.19% 14.25% 12.17% 12.89% 15.32% 4.27% Return on averagetangible equity (a) 19.95% 14.37% 15.54% 13.32% 14.18% 16.68% 4.71% Efficiency ratio(unadjusted) (e) 56.51% 61.98% 58.39% 60.25% 61.32% 58.95% 81.04% Efficiency ratio(adjusted) (a) 56.39% 61.85% 58.27% 60.12% 61.18% 58.83% 64.08% Non-interestexpense to averageassets 2.56% 2.79% 2.59% 2.71% 2.61% 2.65% 2.54% Loans to deposits 100.66% 100.14% 99.91% 99.95% 93.38% 100.66% 93.38% YIELDS / RATES- Fully TaxableEquivalent Yield on loans 5.70% 5.64% 5.59% 5.69% 5.68% 5.64% 5.60%
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Yield oninvestments 2.28% 2.27% 2.28% 2.40% 2.55% 2.28% 2.34% Yield on interest-earning assets 5.25% 5.18% 5.13% 5.18% 5.15% 5.19% 4.90% Cost of interest-bearing deposits 2.08% 2.06% 2.05% 2.18% 2.36% 2.06% 2.43% Cost of borrowings 5.52% 5.67% 5.74% 7.42% 7.33% 5.64% 5.43% Cost of interest-bearing liabilities 2.30% 2.27% 2.27% 2.34% 2.51% 2.28% 2.55% Cost of funds 1.67% 1.67% 1.67% 1.72% 1.85% 1.67% 1.90% Interest rate spread 2.95% 2.91% 2.86% 2.84% 2.64% 2.91% 2.35% Net interestmargin, fullytaxable equivalent 3.74% 3.67% 3.60% 3.61% 3.45% 3.67% 3.15% CAPITAL Total equity to totalassets at end ofperiod 9.59% 9.59% 9.57% 9.40% 9.10% 9.59% 9.10% Tangible equity totangible assets atend of period (a) 8.90% 8.88% 8.84% 8.66% 8.36% 8.90% 8.36% Book value pershare $ 56.51 $ 55.88 $ 54.36 $ 52.97 $ 50.98 $ 56.51 $ 50.98 Tangible bookvalue per share (a) 52.00 51.37 49.85 48.43 46.44 52.00 46.44 Period-end marketvalue per share 80.86 74.58 53.82 55.80 52.52 80.86 52.52 Dividends declaredper share 0.36 0.34 0.34 0.34 0.34 1.04 0.98 AVERAGEBALANCES Loans and loansheld for sale (b) $2,376,225 $2,338,605 $2,292,239 $2,223,188 $2,171,673 $2,335,997 $2,119,666 Interest-earningassets 2,732,061 2,706,598 2,662,192 2,625,177 2,617,680 2,700,539 2,698,654 Total assets 2,799,952 2,774,578 2,733,232 2,691,963 2,684,273 2,769,381 2,756,604 Deposits 2,360,851 2,352,242 2,319,614 2,340,931 2,343,596 2,344,386 2,406,929 Total equity 274,534 267,809 261,823 252,325 239,836 268,102 230,662 Tangible equity (a) 252,710 245,985 239,999 230,501 218,012 246,278 208,838 ASSETQUALITY Net charge-offs(recoveries) $ (2,563) $ 160 $ (94) $ 532 $ 86 $ (2,497) $ 1,340 Non-performingloans (c) 13,798 9,160 7,627 7,908 7,762 13,798 7,762 Non-performingassets (d) 16,078 11,211 9,758 8,165 7,972 16,078 7,972 Allowance forcredit losses 25,213 25,232 24,890 24,209 23,645 25,213 23,645 Annualized netcharge-offs(recoveries) toaverage loans (0.43%) 0.03% (0.02%) 0.09% 0.02% (0.14%) 0.08% Non-performingloans to total loans 0.57% 0.39% 0.33% 0.35% 0.35% 0.57% 0.35% Non-performingassets to totalassets 0.56% 0.40% 0.36% 0.30% 0.30% 0.56% 0.30% Allowance forcredit losses to 1.05% 1.07% 1.08% 1.07% 1.07% 1.05% 1.07%
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total loans Allowance forcredit losses tonon-performingloans 182.73% 275.46% 326.34% 306.13% 304.63% 182.73% 304.63% (a) See the GAAPto Non-GAAPreconciliations. (b) Loans and loans held for sale do not reflect the allowance for credit losses. (c) Non-performing loans include nonaccrual loans only. (d) Non-performing assets include non-performing loans plus other real estate owned andrepossessed vehicles. (e) Efficiency ratio (unadjusted) is non-interest expense divided by the total of net interestincome plus non-interest income. Chemung FinancialCorporation Average Consolidated Balance Sheets & Net Interest Income Analysis and Rate/Volume Analysis of Net Interest Income(Unaudited) Three Months EndedSeptember 30, 2026 Three Months EndedSeptember 30, 2025 Three Months Ended September 30, 2026 vs. 2025 (in thousands) AverageBalance Interest Yield /Rate AverageBalance Interest Yield /Rate TotalChange Due toVolume Due toRate Interest-earningassets: Commercial loans $1,857,875 $27,592 5.89% $1,636,743 $24,383 5.91% $ 3,209 $ 3,284 $ (75) Residentialmortgage loans 287,209 3,215 4.44% 277,682 3,063 4.38% 152 106 46 Consumer loans 231,141 3,336 5.73% 257,248 3,638 5.61% (302) (376) 74 Taxable securities 318,954 1,702 2.12% 334,290 1,656 1.97% 46 (78) 124 Tax-exemptsecurities 11,574 103 3.53% 11,864 93 3.11% 10 (2) 12 Interest-earningdeposits 25,308 239 3.75% 99,853 1,118 4.44% (879) (727) (152) Total interest-earning assets 2,732,061 36,187 5.25% 2,617,680 33,951 5.15% 2,236 2,207 29 Non interest-earning assets: Cash and due frombanks 26,874 26,580 Other assets 67,866 62,923 Allowance forcredit losses (26,849) (22,910) Total assets $2,799,952 $2,684,273 Interest-bearingliabilities: Interest-bearingchecking $ 306,782 $ 1,112 1.44% $ 326,464 $ 1,287 1.56% $ (175) $ (75) $ (100) Savings andmoney market 937,393 4,277 1.81% 870,958 4,376 1.99% (99) 320 (419) Time deposits 432,392 3,368 3.09% 507,557 4,429 3.46% (1,061) (615) (446) Brokered deposits 7,149 67 3.72% 7,174 79 4.37% (12) — (12)
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FHLBNYovernightadvances 5,235 52 3.94% 23 — —% 52 52 — Term advances andother debt 67,248 671 3.96% 11,331 127 4.45% 544 560 (16) Subordinated debt 44,090 898 8.08% 44,105 898 8.08% — (1) 1 Total interest-bearing liabilities 1,800,289 10,445 2.30% 1,767,612 11,196 2.51% (751) 241 (992) Non interest-bearing liabilities: Demand deposits 677,135 631,443 Other liabilities 47,994 45,382 Total liabilities 2,525,418 2,444,437 Shareholders'equity 274,534 239,836 Total liabilities andshareholders'equity $2,799,952 $2,684,273 Fully taxableequivalent netinterest income 25,742 22,755 $ 2,987 $ 1,966 $ 1,021 Net interest ratespread (1) 2.95% 2.64% Net interestmargin, fullytaxable equivalent(2) 3.74% 3.45% Taxable equivalentadjustment (68) (67) Net interestincome $25,674 $22,688 (1) Net interest rate spread is the difference in the average yield on interest-earning assets less the average rate on interest-bearing liabilities. (2) Net interest margin is the ratio of fully taxable equivalent net interest income divided by average interest-earningassets. Chemung FinancialCorporation Average Consolidated Balance Sheets & Net Interest Income Analysis and Rate/Volume Analysis of Net Interest Income(Unaudited) Nine Months EndedSeptember 30, 2026 Nine Months Ended September 30, 2025 Nine Months EndedSeptember 30, 2026 vs. 2025 (in thousands) AverageBalance Interest Yield /Rate AverageBalance Interest Yield /Rate TotalChange Due toVolume Due toRate Interest-earningassets: Commercial loans $1,812,473 $ 79,085 5.83% $1,578,397 $68,988 5.84% $10,097 $10,214 $ (117) Residentialmortgage loans 286,384 9,500 4.44% 276,540 8,611 4.16% 889 314 575 Consumer loans 237,140 9,998 5.64% 264,729 11,116 5.61% (1,118) (1,163) 45 Taxable securities 322,735 5,061 2.10% 483,242 7,215 2.00% (2,154) (2,501) 347
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Tax-exemptsecurities 11,152 277 3.32% 27,101 611 3.01% (334) (391) 57 Interest-earningdeposits 30,655 867 3.78% 68,645 2,298 4.48% (1,431) (1,117) (314) Total interest-earning assets 2,700,539 104,788 5.19% 2,698,654 98,839 4.90% 5,949 5,356 593 Non interest-earning assets: Cash and due frombanks 26,200 25,882 Other assets 68,201 54,411 Allowance forcredit losses (25,559) (22,343) Total assets $2,769,381 $2,756,604 Interest-bearingliabilities: Interest-bearingchecking $ 320,194 $ 3,444 1.44% $ 332,492 $ 3,888 1.56% $ (444) $ (140) $ (304) Savings and moneymarket 906,692 11,800 1.74% 865,917 12,479 1.93% (679) 569 (1,248) Time deposits 448,856 10,449 3.11% 513,847 13,669 3.56% (3,220) (1,620) (1,600) Brokered deposits 13,261 373 3.76% 70,560 2,367 4.49% (1,994) (1,663) (331) FHLBNY overnightadvances 11,493 337 3.92% 8,319 286 4.60% 51 97 (46) Term advances andother debt 53,570 1,571 3.92% 44,778 1,509 4.51% 62 273 (211) Subordinated debt 44,064 2,693 8.17% 18,281 1,105 8.08% 1,588 1,576 12 Total interest-bearing liabilities 1,798,130 30,667 2.28% 1,854,194 35,303 2.55% (4,636) (908) (3,728) Non interest-bearing liabilities: Demand deposits 655,383 624,113 Other liabilities 47,766 47,635 Total liabilities 2,501,279 2,525,942 Shareholders'equity 268,102 230,662 Total liabilitiesandshareholders'equity $2,769,381 $2,756,604 Fully taxableequivalent netinterest income 74,121 63,536 $10,585 $ 6,264 $ 4,321 Net interest ratespread (1) 2.91% 2.35% Net interest margin,fully taxableequivalent (2) 3.67% 3.15% Taxable equivalentadjustment (193) (223) Net interest income $ 73,928 $63,313 (1) Net interest rate spread is the difference in the average yield on interest-earning assets less the average rate on interest-bearing liabilities.
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(2) Net interest margin is the ratio of fully taxable equivalent net interest income divided by average interest-earningassets. Chemung FinancialCorporation Average Consolidated Balance Sheets & Net Interest Income Analysis and Rate/Volume Analysis of Net Interest Income(Unaudited) Three Months EndedSeptember 30, 2026 Three Months EndedJune 30, 2026 Three Months EndedSeptember 30, 2026 vs.June 30, 2026 (in thousands) AverageBalance Interest Yield /Rate AverageBalance Interest Yield /Rate TotalChange Due toVolume Due toRate Interest-earningassets: Commercial loans $1,857,875 $27,592 5.89% $1,816,492 $26,384 5.83% $ 1,208 $ 806 $ 402 Residentialmortgage loans 287,209 3,215 4.44% 285,723 3,159 4.43% 56 43 13 Consumer loans 231,141 3,336 5.73% 236,390 3,328 5.65% 8 (53) 61 Taxable securities 318,954 1,702 2.12% 322,178 1,669 2.08% 33 (11) 44 Tax-exemptsecurities 11,574 103 3.53% 10,951 89 3.26% 14 6 8 Interest-earningdeposits 25,308 239 3.75% 34,864 325 3.74% (86) (87) 1 Total interest-earning assets 2,732,061 36,187 5.25% 2,706,598 34,954 5.18% 1,233 704 529 Non interest-earningassets: Cash and due frombanks 26,874 25,474 Other assets 67,866 67,713 Allowance for creditlosses (26,849) (25,207) Total assets $2,799,952 $2,774,578 Interest-bearingliabilities: Interest-bearingchecking $ 306,782 $ 1,112 1.44% $ 321,366 $ 1,152 1.44% $ (40) $ (40) $ — Savings and moneymarket 937,393 4,277 1.81% 921,455 4,036 1.76% 241 88 153 Time deposits 432,392 3,368 3.09% 451,968 3,504 3.11% (136) (119) (17) Brokered deposits 7,149 67 3.72% 1,183 11 3.73% 56 56 — FHLBNY overnightadvances 5,235 52 3.94% 3,231 31 3.85% 21 20 1 Term advances andother debt 67,248 671 3.96% 60,031 589 3.94% 82 78 4 Subordinated debt 44,090 898 8.08% 44,064 898 8.17% — 4 (4) Total interest-bearing liabilities 1,800,289 10,445 2.30% 1,803,298 10,221 2.27% 224 87 137 Non interest-bearingliabilities: Demand deposits 677,135 656,270
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Other liabilities 47,994 47,201 Total liabilities 2,525,418 2,506,769 Shareholders' equity 274,534 267,809 Total liabilitiesand shareholders'equity $2,799,952 $2,774,578 Fully taxableequivalent netinterest income 25,742 24,733 $ 1,009 $ 617 $ 392 Net interest ratespread (1) 2.95% 2.91% Net interest margin,fully taxableequivalent (2) 3.74% 3.67% Taxable equivalentadjustment (68) (63) Net interest income $25,674 $24,670 (1) Net interest rate spread is the difference in the average yield on interest-earning assets less the average rate on interest-bearing liabilities. (2) Net interest margin is the ratio of fully taxable equivalent net interest income divided by average interest-earningassets. Chemung Financial Corporation GAAP to Non-GAAP Reconciliations (Unaudited) The Corporation prepares its Consolidated Financial Statements in accordance with GAAP. See the Corporation’sunaudited consolidated balance sheets and statements of income contained within this press release. That presentationprovides the reader with an understanding of the Corporation’s results that can be tracked consistently from period-to-period and enables a comparison of the Corporation’s performance with other companies’ GAAP financial statements. In addition to analyzing the Corporation’s results on a reported basis, management uses certain non-GAAP financialmeasures, because it believes these non-GAAP financial measures provide information to investors about the underlyingoperational performance and trends of the Corporation and, therefore, facilitate a comparison of the Corporation with theperformance of other companies. Non-GAAP financial measures used by the Corporation may not be comparable tosimilarly named non-GAAP financial measures used by other companies. The SEC has adopted Regulation G, which applies to all public disclosures, including earnings releases, made byregistered companies that contain “non-GAAP financial measures.” Under Regulation G, companies making publicdisclosures containing non-GAAP financial measures must also disclose, along with each non-GAAP financial measure,certain additional information, including a reconciliation of the non-GAAP financial measure to the closest comparableGAAP financial measure and a statement of the Corporation’s reasons for utilizing the non-GAAP financial measure aspart of its financial disclosures. The SEC has exempted from the definition of “non-GAAP financial measures” certaincommonly used financial measures that are not based on GAAP. When these exempted measures are included in publicdisclosures, supplemental information is not required. The following measures used in this Report, which are commonlyutilized by financial institutions, have not been specifically exempted by the SEC and may constitute "non-GAAP financialmeasures" within the meaning of the SEC's rules, although we are unable to state with certainty that the SEC would soregard them. Fully Taxable Equivalent Net Interest Income and Net Interest Margin Net interest income is commonly presented on a tax-equivalent basis. That is, to the extent that some component of theinstitution's net interest income, which is presented on a before-tax basis, is exempt from taxation (e.g., is received by theinstitution as a result of its holdings of state or municipal obligations), an amount equal to the tax benefit derived from thatcomponent is added to the actual before-tax net interest income total. This adjustment is considered helpful in comparingone financial institution's net interest income to that of other institutions or in analyzing any institution’s net interestincome trend line over time, to correct any analytical distortion that might otherwise arise from the fact that financialinstitutions vary widely in the proportions of their portfolios that are invested in tax-exempt obligations, and that even asingle institution may significantly alter over time the proportion of its own portfolio that is invested in tax-exempt
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obligations. Moreover, net interest income is itself a component of a second financial measure commonly used by financialinstitutions, net interest margin, which is the ratio of net interest income to average interest-earning assets. For purposes ofthis measure as well, fully taxable equivalent net interest income is generally used by financial institutions, as opposed toactual net interest income, again to provide a better basis of comparison from institution to institution and to betterdemonstrate a single institution’s performance over time. The Corporation follows these practices. As of or for the As of or for the Three Months Ended Nine Months Ended Sept. 30, June 30, March 31, Dec. 31, Sept. 30, Sept. 30, Sept. 30, (in thousands,except ratio data) 2026 2026 2026 2025 2025 2026 2025 NET INTERESTMARGIN -FULLYTAXABLEEQUIVALENT Net interest income(GAAP) $ 25,674 $ 24,670 $ 23,584 $ 23,844 $ 22,688 $ 73,928 $ 63,313 Fully taxableequivalentadjustment 68 63 62 70 67 193 223 Fully taxableequivalent netinterest income(non-GAAP) $ 25,742 $ 24,733 $ 23,646 $ 23,914 $ 22,755 $ 74,121 $ 63,536 Average interest-earning assets(GAAP) $2,732,061 $2,706,598 $2,662,192 $2,625,177 $2,617,680 $2,700,539 $2,698,654 Net interest margin- fully taxableequivalent (non-GAAP) 3.74% 3.67% 3.60% 3.61% 3.45% 3.67% 3.15% Pre-Provision Net Revenue Pre-provision net revenue (“PPNR”), adjusted PPNR, and the ratios of each to average assets and average equity are non-GAAP financial measures. PPNR represents the Corporation’s income before income tax expense, excluding the provisionfor credit losses. Adjusted PPNR further excludes the impact of certain transactions or other material items of income orexpense that may have had a disproportionate positive or negative impact on the Corporation’s financial results during aparticular period. These measures are meaningful to the Corporation, as well as investors and analysts, in assessing theCorporation’s ability to generate earnings sufficient to absorb credit losses and support capital, independent of thevolatility and timing of provision expense. As of or for the As of or for the Three Months Ended Nine Months Ended Sept. 30, June 30, March 31, Dec. 31, Sept. 30, Sept. 30, Sept. 30, (in thousands,except ratio data) 2026 2026 2026 2025 2025 2026 2025 PRE-PROVISIONNET REVENUE Income beforeincome tax expense(GAAP) $ 16,509 $ 11,291 $ 11,841 $ 10,993 $ 10,067 $ 39,641 $ 8,943 Add: Provision(credit) for creditlosses (2,602) 561 601 1,136 1,064 (1,440) 3,301 Pre-provision netrevenue (PPNR) $ 13,907 $ 11,852 $ 12,442 $ 12,129 $ 11,131 $ 38,201 $ 12,244
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(non-GAAP) Less: net (gains)losses on securitiestransactions — — — — — — 17,498 Less: (gain) loss onsale of branchproperty — — — — — — (629) Adjusted pre-provision netrevenue (PPNR)(non-GAAP) $ 13,907 $ 11,852 $ 12,442 $ 12,129 $ 11,131 $ 38,201 $ 29,113 Average total assets(GAAP) $2,799,952 $2,774,578 $2,733,232 $2,691,963 $2,684,273 $2,769,381 $2,756,604 Average totalshareholders' equity(GAAP) $ 274,534 $ 267,809 $ 261,823 $ 252,325 $ 239,836 $ 268,102 $ 230,662 PPNR to totalaverage assets (non-GAAP) 1.97% 1.71% 1.85% 1.79% 1.65% 1.84% 0.59% PPNR to totalaverage equity(non-GAAP) 20.10% 17.75% 19.27% 19.07% 18.41% 19.05% 7.10% Adjusted PPNR tototal average assets(non-GAAP) 1.97% 1.71% 1.85% 1.79% 1.65% 1.84% 1.41% Adjusted PPNR tototal average equity(non-GAAP) 20.10% 17.75% 19.27% 19.07% 18.41% 19.05% 16.87% Efficiency Ratio The unadjusted efficiency ratio is calculated as non-interest expense divided by total revenue (net interest income and non-interest income). The adjusted efficiency ratio is a non-GAAP financial measure which represents the Corporation’s abilityto turn resources into revenue and is calculated as non-interest expense divided by total revenue (fully taxable equivalentnet interest income and non-interest income), adjusted for one-time occurrences and amortization. This measure ismeaningful to the Corporation, as well as investors and analysts, in assessing the Corporation’s productivity measured bythe amount of revenue generated for each dollar spent. As of or for the As of or for the Three Months Ended Nine Months Ended Sept. 30, June 30, March 31, Dec. 31, Sept. 30, Sept. 30, Sept. 30, (in thousands, except ratiodata) 2026 2026 2026 2025 2025 2026 2025 EFFICIENCY RATIO Net interest income (GAAP) $ 25,674 $ 24,670 $ 23,584 $ 23,844 $ 22,688 $ 73,928 $ 63,313 Fully taxable equivalentadjustment 68 63 62 70 67 193 223 Fully taxable equivalent netinterest income (non-GAAP) $ 25,742 $ 24,733 $ 23,646 $ 23,914 $ 22,755 $ 74,121 $ 63,536 Non-interest income (GAAP) $ 6,307 $ 6,503 $ 6,320 $ 6,673 $ 6,088 $ 19,130 $ 1,272 Less: net (gains) losses onsecurities transactions — — — — — — 17,498 Less: (gain) loss on sale ofbranch property — — — — — — (629) Adjusted non-interest income(non-GAAP) $ 6,307 $ 6,503 $ 6,320 $ 6,673 $ 6,088 $ 19,130 $ 18,141
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Non-interest expense (GAAP) $ 18,074 $ 19,321 $ 17,462 $ 18,388 $ 17,645 $ 54,857 $ 52,341 Efficiency ratio (unadjusted) 56.51% 61.98% 58.39% 60.25% 61.32% 58.95% 81.04% Efficiency ratio (adjusted) 56.39% 61.85% 58.27% 60.12% 61.18% 58.83% 64.08% Tangible Equity and Tangible Assets (Period-End) Tangible equity, tangible assets, and tangible book value per share are each non-GAAP financial measures. Tangible equityrepresents the Corporation’s stockholders’ equity, less goodwill and other intangible assets. Tangible assets represent theCorporation’s total assets, less goodwill and other intangible assets. Tangible book value per share represents theCorporation’s tangible equity divided by common shares at period-end. These measures are meaningful to the Corporation,as well as investors and analysts, in assessing the Corporation’s use of equity. As of or for the As of or for the Three Months Ended Nine Months Ended Sept. 30, June 30, March 31, Dec. 31, Sept. 30, Sept. 30, Sept. 30, (in thousands,except per shareand ratio data) 2026 2026 2026 2025 2025 2026 2025 TANGIBLEEQUITY ANDTANGIBLEASSETS (PERIOD END) Total shareholders'equity (GAAP) $ 273,512 $ 270,361 $ 262,929 $ 254,709 $ 245,308 $ 273,512 $ 245,308 Less: intangibleassets (21,824) (21,824) (21,824) (21,824) (21,824) (21,824) (21,824) Tangible equity(non-GAAP) $ 251,688 $ 248,537 $ 241,105 $ 232,885 $ 223,484 $ 251,688 $ 223,484 Total assets(GAAP) $2,851,340 $2,820,202 $2,748,722 $2,710,235 $2,696,634 $2,851,340 $2,696,634 Less: intangibleassets (21,824) (21,824) (21,824) (21,824) (21,824) (21,824) (21,824) Tangible assets(non-GAAP) $2,829,516 $2,798,378 $2,726,898 $2,688,411 $2,674,810 $2,829,516 $2,674,810 Total equity to totalassets at end ofperiod (GAAP) 9.59% 9.59% 9.57% 9.40% 9.10% 9.59% 9.10% Book value pershare (GAAP) $ 56.51 $ 55.88 $ 54.36 $ 52.97 $ 50.98 $ 56.51 $ 50.98 Tangible equity totangible assets atend of period (non-GAAP) 8.90% 8.88% 8.84% 8.66% 8.36% 8.90% 8.36% Tangible bookvalue per share(non-GAAP) $ 52.00 $ 51.37 $ 49.85 $ 48.43 $ 46.44 $ 52.00 $ 46.44 Tangible Equity (Average) Average tangible equity and return on average tangible equity are each non-GAAP financial measures. Average tangibleequity represents the Corporation’s average stockholders’ equity, less average goodwill and other intangible assets for theperiod. Return on average tangible equity measures the Corporation’s earnings as a percentage of average tangible equity.
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These measures are meaningful to the Corporation, as well as investors and analysts, in assessing the Corporation’s use ofequity. As of or for the As of or for the Three Months Ended Nine Months Ended Sept. 30, June 30, March 31, Dec. 31, Sept. 30, Sept. 30, Sept. 30, (in thousands, except ratiodata) 2026 2026 2026 2025 2025 2026 2025 TANGIBLE EQUITY(AVERAGE) Total average shareholders'equity (GAAP) $274,534 $267,809 $261,823 $252,325 $239,836 $268,102 $230,662 Less: average intangibleassets (21,824) (21,824) (21,824) (21,824) (21,824) (21,824) (21,824) Average tangible equity (non-GAAP) $252,710 $245,985 $239,999 $230,501 $218,012 $246,278 $208,838 Net income (GAAP) $ 12,707 $ 8,810 $ 9,199 $ 7,741 $ 7,792 $ 30,716 $ 7,363 Return on average equity(GAAP) 18.36% 13.19% 14.25% 12.17% 12.89% 15.32% 4.27% Return on average tangibleequity (non-GAAP) 19.95% 14.37% 15.54% 13.32% 14.18% 16.68% 4.71% Adjustments for Certain Items of Income or Expense In addition to disclosures of certain GAAP financial measures, including net income, EPS, ROAA, and ROAE, we mayalso provide comparative disclosures that adjust these GAAP financial measures for a particular period by removing fromthe calculation thereof the impact of certain transactions or other material items of income or expense occurring during theperiod, including certain nonrecurring items. The Corporation believes that the resulting non-GAAP financial measuresmay improve an understanding of its results of operations by separating out any such transactions or items that may havehad a disproportionate positive or negative impact on the Corporation’s financial results during the particular period inquestion. In the Corporation’s presentation of any such non-GAAP (adjusted) financial measures not specifically discussedin the preceding paragraphs, the Corporation supplies the supplemental financial information and explanations requiredunder Regulation G. As of or for the As of or for the Three Months Ended Nine Months Ended Sept. 30, June 30, March 31, Dec. 31, Sept. 30, Sept. 30, Sept. 30, (in thousands,except per shareand ratio data) 2026 2026 2026 2025 2025 2026 2025 NON-GAAP NETINCOME Reported netincome (GAAP) $ 12,707 $ 8,810 $ 9,199 $ 7,741 $ 7,792 $ 30,716 $ 7,363 Net (gains) losseson securitiestransactions (net oftax) — — — — — — 13,237 Net (gain) loss onsale of branchproperty (net of tax) — — — — — — (463) Net income (non-GAAP) $ 12,707 $ 8,810 $ 9,199 $ 7,741 $ 7,792 $ 30,716 $ 20,137 Average basic anddiluted sharesoutstanding 4,839 4,838 4,825 4,811 4,811 4,833 4,802
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Average total assets(GAAP) $2,799,952 $2,774,578 $2,733,232 $2,691,963 $2,684,273 $2,769,381 $2,756,604 Average totalshareholders' equity(GAAP) 274,534 267,809 261,823 252,325 239,836 268,102 230,662 Reported basic anddiluted earnings pershare (GAAP) $ 2.63 $ 1.82 $ 1.91 $ 1.61 $ 1.62 $ 6.36 $ 1.53 Reported return onaverage assets(GAAP) 1.80% 1.27% 1.36% 1.14% 1.15% 1.48% 0.36% Reported return onaverage equity(GAAP) 18.36% 13.19% 14.25% 12.17% 12.89% 15.32% 4.27% Basic and dilutedearnings per share(non-GAAP) $ 2.63 $ 1.82 $ 1.91 $ 1.61 $ 1.62 $ 6.36 $ 4.19 Return on averageassets (non-GAAP) 1.80% 1.27% 1.36% 1.14% 1.15% 1.48% 0.98% Return on averageequity (non-GAAP) 18.36% 13.19% 14.25% 12.17% 12.89% 15.32% 11.67% For further information contact:Dale M. McKim, III, EVP and CFO dmckim@chemungcanal.comPhone: 607-737-3714 Category: Financial Source: Chemung Financial Corp