Reduction in net interest margin following the 50bps Fed rate cut is expected to drag earnings of NBT Bancorp, Inc. (NBTB) in 2020. Some of the negative effect of the margin decline is expected to be offset by slightly higher earning assets, higher non-interest income, and lower provisions charge for loan losses. Unlike earnings, dividends are expected to remain at their current level through 2020.
Sticky Cost to Pressurize Net Interest Margin
According to the results of a simulation disclosed in the 2QFY19 SEC filing, NBTB's net interest income can decrease by