Form 8-K

8-K — COMMUNITY FINANCIAL SYSTEM, INC.

Accession: 0001104659-26-050927

Filed: 2026-04-29

Period: 2026-04-29

CIK: 0000723188

SIC: 6021 (NATIONAL COMMERCIAL BANKS)

Item: Results of Operations and Financial Condition

Item: Financial Statements and Exhibits

Documents

8-K — tm2613014d1_8k.htm (Primary)

EX-99.1 — EXHIBIT 99.1 (tm2613014d1_ex99-1.htm)

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8-K — FORM 8-K

8-K (Primary)

Filename: tm2613014d1_8k.htm · Sequence: 1

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COMMUNITY FINANCIAL SYSTEM, INC.

0000723188

2026-04-29

iso4217:USD

xbrli:shares

iso4217:USD

xbrli:shares

UNITED STATES

SECURITIES AND

EXCHANGE COMMISSION

WASHINGTON, D.C.

20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):

April 29, 2026

(Exact name of registrant as specified in

its charter)

Delaware

001-13695

16-1213679

(State or other jurisdiction

incorporation)

(Commission File

Number)

(IRS Employer Identification

No.)

333 Butternut Drive, Syracuse, New York

13214

(Address

of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (315)

445-2282

Not

applicable.

(Former name or former

address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended

to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading

Symbol(s)

Name

of each exchange on which registered

Common Stock, $1.00 par value per share

CBU

New York Stock Exchange

Indicate by check mark whether the registrant is an emerging

growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities

Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant

has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant

to Section 13(a) of the Exchange Act. ¨

Item 2.02 Results of Operations and Financial Condition.

On April 29, 2026, Community Financial System, Inc.

announced its results of operations for the first quarter ended March 31, 2026. The public announcement was made by means of a news

release, the text of which is furnished as Exhibit 99.1.

The information in this Form 8-K, including

Exhibit 99.1 attached hereto, is being furnished under Item 2.02 and shall not be deemed to be “filed” for purposes of

Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any

filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference

in such filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

The following exhibit is being furnished pursuant

to Item 2.02 above.

99.1 Press Release, dated April 29, 2026, issued by Community Financial System, Inc.

104 Cover Page Interactive Data File (embedded in the cover page formatted in Inline XBRL)

SIGNATURES

Pursuant to the requirements of the Securities Exchange

Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Community Financial System, Inc.

By:

/s/ Marya Burgio Wlos

Name: Marya Burgio Wlos

Title: Executive Vice President and Chief Financial Officer

Dated: April 29, 2026

Exhibit Index

Exhibit Number

Description

99.1

Press Release, dated April 29, 2026, issued by Community Financial System, Inc.

104

Cover Page Interactive Data File (embedded in the cover page formatted

in Inline XBRL)

EX-99.1 — EXHIBIT 99.1

EX-99.1

Filename: tm2613014d1_ex99-1.htm · Sequence: 2

Exhibit 99.1

News Release

For further information, please contact:

333 Butternut Drive, Syracuse, N.Y. 13214

Marya Burgio Wlos, EVP & Chief Financial Officer

Office: (315) 299-2946

Community

Financial System, Inc. Reports First Quarter 2026 Results

SYRACUSE, N.Y. — April 29, 2026 — Community Financial

System, Inc. (the “Company”) (NYSE: CBU) reported first quarter 2026 results. The results are available within the “News”

section of the Company's investor relations website or directly at https://communityfinancialsystem.com/Q1-2026-CBU-Earnings-Release.

Company management will host a conference call at 11:00 a.m. (ET)

today, April 29, 2026, to discuss the first quarter 2026 results. The conference call can be accessed via webcast at https://app.webinar.net/qplYz5Bw2x6

or via dial-in at 1-833-630-0464 (United States) or 1-412-317-1809 (International).

About Community Financial System, Inc.

Community Financial System, Inc. is a diversified financial

services company that is focused on four main business lines – banking services, employee benefit services, insurance services

and wealth management services. Its banking subsidiary, Community Bank, N.A., is among the country’s 100 largest banking institutions

with over $17 billion in assets and operates approximately 200 customer facilities across Upstate New York, Northeastern Pennsylvania,

Vermont, Western Massachusetts and Southern New Hampshire. The Company’s Benefit Plans Administrative Services, Inc. subsidiary

is a leading provider of employee benefits administration, trust services, collective investment fund administration, and actuarial consulting

services to customers on a national scale. The Company’s OneGroup NY, Inc. subsidiary is a top 68 U.S. insurance agency. The

Company also offers comprehensive financial planning, trust administration and wealth management services through its Nottingham Financial

Group operating unit. The Company is listed on the New York Stock Exchange and the Company’s stock trades under the symbol CBU.

For more information about the Company and each of its four main business lines visit https://communityfinancialsystem.com.

News Release

For further information, please contact:

333 Butternut Drive, Syracuse, N.Y. 13214

Marya Burgio Wlos, EVP & Chief Financial

Officer

Office: (315) 299-2946

Community

Financial System, Inc. Reports First Quarter 2026 Results

SYRACUSE, N.Y. — April 29, 2026

Community Financial System, Inc. (the “Company”) (NYSE: CBU) reported first quarter 2026 net income of $57.2 million, or $1.08 per share and operating net income of $61.1 million, or $1.15 per share.

“Our Company delivered another quarter of strong core performance

with operating diluted earnings per share1 of $1.15, up 17.3% year-over-year and representing our fourth consecutive quarter

of record results,” commented Dimitar A. Karaivanov, President and CEO.

“Our organic momentum continues across all businesses and is

also supported by margin and market value tailwinds. During the quarter we achieved an operating return on assets1 of 1.42%

while continuing to actively invest in organic and inorganic growth initiatives. At the same time, we remain focused on expanding operating

leverage and ensuring that recent investments translate fully into bottom-line results. With our diversified financial services businesses,

high-quality balance sheet and disciplined capital deployment, we are well positioned to continue to scale the Company and continue to

expect strong earnings growth through the remainder of 2026.”

First Quarter 2026 Performance

Quarter-over-

Quarter Increase

(Decrease)

Year-over-Year

Increase (Decrease)

Dollars in thousands, except per share data

1st Qtr

2026

4th Qtr

2025

1st Qtr

2025

Operating Performance

Diluted Earnings Per Share

$1.08

$1.03

$0.93

$0.05

4.9%

$0.15

16.1%

Operating Diluted Earnings Per Share1

1.15

1.12

0.98

0.03

2.7%

0.17

17.3%

Operating Pre-Tax, Pre-Provision Net Revenue Per Share1

1.61

1.58

1.40

0.03

1.9%

0.21

15.0%

Return Metrics

Return on Assets

1.33%

1.26%

1.22%

0.07%

0.11%

Operating Return on Assets1

1.42%

1.38%

1.28%

0.04%

0.14%

Return on Equity

11.51%

11.04%

11.28%

0.47%

0.23%

Operating Return on Equity1

12.30%

12.08%

11.84%

0.22%

0.46%

First Quarter 2026 Performance (continued)

Quarter-over-

Quarter Increase

(Decrease)

Year-over-Year

Increase (Decrease)

Dollars in thousands, except per share data

1st Qtr

2026

4th Qtr

2025

1st Qtr

2025

Revenues

Total Revenues

$213,286

$215,451

$196,248

($2,165)

(1.0%)

$17,038

8.7%

Total Operating Revenues (FTE)1

214,537

216,431

196,897

(1,894)

(0.9%)

17,640

9.0%

Noninterest Revenues

78,574

82,026

76,036

(3,452)

(4.2%)

2,538

3.3%

Total Operating Noninterest Revenues1

78,975

82,131

75,791

(3,156)

(3.8%)

3,184

4.2%

Noninterest Revenues/Total Revenues

36.8%

38.1%

38.7%

(1.3%)

(1.9%)

Operating Noninterest Revenues/Operating Revenues (FTE)1

36.8%

37.9%

38.5%

(1.1%)

(1.7%)

Net Interest Income and Margin

Net Interest Income

$134,712

$133,425

$120,212

$1,287

1.0%

$14,500

12.1%

Net Interest Margin

3.43%

3.37%

3.21%

0.06%

0.22%

Net Interest Margin (FTE)1

3.45%

3.39%

3.24%

0.06%

0.21%

Balance Sheet and Funding

Total Ending Loans

$11,131,184

$10,949,757

$10,421,141

$181,427

1.7%

$710,043

6.8%

Total Ending Deposits

14,870,122

14,387,085

13,892,047

483,037

3.4%

978,075

7.0%

Cost of Total Deposits

1.10%

1.15%

1.17%

(0.05%)

(0.07%)

Cost of Funds

1.20%

1.27%

1.33%

(0.07%)

(0.13%)

Risk Metrics

Annualized Loan Net Charge-Offs

0.11%

0.09%

0.13%

0.02%

(0.02%)

Tier 1 Leverage Ratio

9.20%

9.21%

9.29%

(0.01%)

(0.09%)

Loan-to-deposit ratio

74.9%

76.1%

75.0%

(1.2%)

(0.1%)

Non-owner occupied and multifamily commercial real estate (“CRE”) / total bank-level regulatory capital

194%

191%

1Non-GAAP Measure. For more information on Non-GAAP measures,

refer to “Non-GAAP Measures” section along with the Quarterly GAAP to Non-GAAP Reconciliations included within the “Summary

of Financial Data (unaudited)” tables below.

First Quarter 2026 Business Segment Results2

Quarter-over-Quarter

Increase (Decrease)

Year-over-Year

Increase (Decrease)

Dollars in thousands

1st Qtr

2026

4th Qtr

2025

1st Qtr

2025

Banking and Corporate

Net interest income

$133,550

$132,412

$119,439

$1,138

0.9%

$14,111

11.8%

Provision for credit losses

5,636

4,979

6,690

657

13.2%

(1,054)

(15.8%)

Segment noninterest revenues

21,979

23,556

19,033

(1,577)

(6.7%)

2,946

15.5%

Other segment expenses

90,282

92,522

85,509

(2,240)

(2.4%)

4,773

5.6%

Adjusted income before income taxes

$59,611

$58,467

$46,273

$1,144

2.0%

$13,338

28.8%

Adjusted return on assets3

1.41%

1.37%

1.16%

0.04%

0.25%

Adjusted return on equity3

14.49%

14.35%

12.60%

0.14%

1.89%

Adjusted return on tangible equity1, 3

26.01%

25.56%

23.70%

0.45%

2.31%

Employee Benefit Services

Segment revenues

$36,311

$38,391

$34,116

($2,080)

(5.4%)

$2,195

6.4%

Segment expenses

21,984

22,394

20,676

(410)

(1.8%)

1,308

6.3%

Adjusted income before income taxes

$14,327

$15,997

$13,440

($1,670)

(10.4%)

$887

6.6%

Adjusted return on assets3

23.25%

26.81%

23.45%

(3.56%)

(0.20%)

Adjusted return on equity3

26.73%

30.17%

26.51%

(3.44%)

0.22%

Adjusted return on tangible equity1, 3

52.45%

61.16%

56.04%

(8.71%)

(3.59%)

Insurance Services

Segment revenues

$12,331

$12,475

$14,270

($144)

(1.2%)

($1,939)

(13.6%)

Segment expenses

10,482

11,546

10,162

(1,064)

(9.2%)

320

3.1%

Adjusted income before income taxes

$1,849

$929

$4,108

$920

99.0%

($2,259)

(55.0%)

Adjusted return on assets3

6.88%

3.51%

23.16%

3.37%

(16.28%)

Adjusted return on equity3

8.05%

4.01%

30.55%

4.04%

(22.50%)

Adjusted return on tangible equity1, 3

16.92%

8.26%

184.01%

8.66%

(167.09%)

Wealth Management Services

Segment revenues

$11,063

$10,198

$10,486

$865

8.5%

$577

5.5%

Segment expenses

7,156

7,007

6,851

149

2.1%

305

4.5%

Adjusted income before income taxes

$3,907

$3,191

$3,635

$716

22.4%

$272

7.5%

Adjusted return on assets3

37.18%

30.87%

38.78%

6.31%

(1.60%)

Adjusted return on equity3

42.07%

34.36%

43.67%

7.71%

(1.60%)

Adjusted return on tangible equity1, 3

48.24%

38.50%

49.94%

9.74%

(1.70%)

1Non-GAAP Measure. For more information on Non-GAAP measures,

refer to “Non-GAAP Measures” section along with the Quarterly GAAP to Non-GAAP Reconciliations included within the “Summary

of Financial Data (unaudited)” tables below.

2Refer

to the “Summary of Financial Data (unaudited)” tables below for reconciliations of the reported measure of segment profit

(adjusted income before income taxes) results to Company results and calculations of the segment adjusted return metrics. The reported

measure of segment profit, the reported segment assets and the reported segment equity that are used in the calculations of the segment

adjusted return metrics are presented in conformity with ASC 280: Segment Reporting and follow the methodology disclosed in the

Company’s 2025 Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 27, 2026.

3The segment adjusted return metrics are reported on a pre-tax

basis.

Results of Operations

The Company reported first quarter 2026 net income of $57.2 million,

or $1.08 per share. This compares to net income of $49.6 million, or $0.93 per share, for the first quarter of 2025. The $0.15 increase

in earnings per share was primarily driven by increases in net interest income and noninterest revenues and a decrease in the provision

for credit losses, partially offset by increases in noninterest expenses and income taxes. Comparatively, the Company’s earnings

per share increased $0.05 from $1.03 per share for the linked fourth quarter of 2025, primarily due to decreases in noninterest expenses

and income taxes and an increase in net interest income, partially offset by a decrease in noninterest revenues and an increase in the

provision for credit losses.

Net Interest Income and Net Interest Margin

The Company’s record quarterly net interest income reflected

diminishing funding cost pressures and organic loan growth, supporting continued margin expansion.

· Net interest income in the first quarter of 2026 was $134.7 million, up $14.5

million, or 12.1%, compared to the first quarter of 2025, and up $1.3 million, or 1.0%, from the fourth quarter of 2025.

· Net interest margin for the first quarter of 3.43% and fully tax-equivalent

net interest margin, a non-GAAP measure, of 3.45%, increased 22 basis points and 21 basis points, respectively, from the first quarter

of 2025. These increases were primarily the result of a lower cost of interest-bearing liabilities and a higher yield on interest-earning

assets.

· The yield on interest-earning assets increased 9 basis points to 4.60% over

the prior year’s first quarter primarily driven by higher loan yields.

· The cost of interest-bearing liabilities decreased 16 basis points from 1.75%

in the first quarter of 2025 to 1.59% in the first quarter of 2026, driven by a 12 basis point decrease in the average interest-bearing

deposit rate.

· On a linked quarter basis, net interest margin and fully tax-equivalent

net interest margin, a non-GAAP measure, both increased by 6 basis points. The yield on interest-earning assets was consistent, while

the cost of funds decreased 7 basis points. This included a 9 basis point decrease in the cost of interest-bearing liabilities driven

by an 8 basis point decrease in the average interest-bearing deposit rate to 1.47%. Excluding the impact of the semiannual Federal Reserve

Bank dividend recorded in the fourth quarter of 2025, the yield on interest-earning assets increased 2 basis points compared to the linked

fourth quarter.

Noninterest Revenues

The Company’s noninterest revenue streams generated 37% of total

revenues in the first quarter.

· Banking noninterest revenues, comprised of deposit service and other banking

fees and mortgage banking revenues, totaled $21.8 million for the first quarter of 2026, an increase of $2.7 million, or 14.2%, from the

first quarter of 2025 and a decrease of $1.8 million, or 7.6%, from the fourth quarter of 2025. The increase from the first quarter of

2025 was primarily comprised of higher deposit service fees and customer interest rate swap fee revenues. The decrease from the fourth

quarter of 2025 reflected a $1.6 million one-time income distribution received from a limited partnership investment in the prior quarter.

· Employee benefit services revenues for the first quarter of 2026 were $34.6

million, an increase of $2.0 million, or 6.0%, in comparison to the first quarter of 2025 and a decrease of $2.0 million, or 5.4%, from

the fourth quarter of 2025. The increase from the prior year’s first quarter was largely driven by revenue growth in the recordkeeping

and third-party administration services business line due in part to revenue growth from acquisitions and higher average market values

of assets under administration. The decrease from the linked fourth quarter was reflective of seasonally lower third-party administration

fees.

· Insurance services revenues for the first quarter of 2026

were $12.6 million, which represents a $1.6 million, or 11.4%, decrease versus the prior year’s first quarter and a $0.1 million,

or 0.8%, decrease from the fourth quarter of 2025. The decrease from the prior year’s first quarter was due to changes in the timing

of collections of contingent commission revenues.

· Wealth management services revenues for the first quarter of 2026 totaled

$10.3 million, an increase of $0.5 million, or 4.8%, from the first quarter of 2025, reflective of higher average market values of assets

under management and an increase of $0.8 million, or 7.9%, from the fourth quarter of 2025, reflective of certain seasonally higher Trust

fees.

Noninterest Expenses and Income Taxes

The Company continues to focus on managing expenses consistent with

its organic growth strategies and scale objectives, while evaluating efficiency opportunities and the enhancement of operating leverage

in all lines of business.

· The Company recorded $133.0 million in total noninterest expenses in the first

quarter of 2026, compared to $125.3 million of total noninterest expenses in the prior year’s first quarter. The $7.7 million, or

6.2% increase between the periods was primarily driven by higher salaries and employee benefits expenses, occupancy and equipment expenses

and data processing and communications expenses.

· Salaries and employee benefits expenses increased $3.9 million, or 5.1%, from

the first quarter of 2025, primarily due to incremental costs associated with acquisitions and de novo bank branches opened between the

periods, along with the impact of annual merit-based increases.

· Occupancy and equipment expenses increased $2.2 million, or 17.2%, from the

prior year’s first quarter, driven by incremental costs associated with the opening of de novo bank branches and regional headquarters

and the Santander Bank, N.A. (“Santander”) branch acquisition.

· Data processing and communications expenses increased $1.7 million, or 10.8%,

from the first quarter of 2025 reflective of the Company’s continued investment in customer-facing and back-office technologies,

including artificial intelligence applications and other workflow efficiency initiatives.

· Acquisition expenses were $0.4 million in the first quarter of 2026 primarily

related to the Company’s pending acquisition of Clearpoint Federal Bank & Trust.

· The effective tax rate for the first quarter of 2026 was 23.3%, an increase

from 22.8% in the first quarter of 2025 and a decrease from 24.3% in the fourth quarter of 2025. The increase from the first quarter of

2025 was primarily due to an increase in the amortization of certain income tax credit investments while the decrease from the fourth

quarter of 2025 reflected an increase in tax benefits related to stock-based compensation activity.

Financial Position and Liquidity

The Company’s financial position and liquidity profile remain

strong, demonstrating the effectiveness of its proactive asset and liability management and prudent financial planning.

· The Company’s total assets were $17.74 billion at March 31, 2026,

representing a $980.6 million, or 5.8%, increase from one year prior and a $441.6 million, or 2.6%, increase from the end of 2025. The

increase in the Company’s total assets from one year prior was primarily driven by organic loan growth and the Santander branch

acquisition, while the increase from the end of 2025 was primarily due to higher cash and cash equivalents balances reflective of seasonal

inflows of governmental deposit balances.

· At March 31, 2026, the Company’s readily available sources of liquidity

totaled $6.83 billion, including unrestricted cash and cash equivalents balances of $557.4 million, unpledged investment securities totaling

$1.76 billion, unused borrowing capacity at the Federal Home Loan Bank of New York of $1.62 billion and $2.89 billion of funding availability

at the Federal Reserve Bank’s discount window.

· The Company’s readily available sources of liquidity represent 248%

of the Company’s estimated uninsured deposits, net of collateralized and intercompany deposits, at March 31, 2026.

· Estimated insured deposits, net of collateralized and intercompany

deposits, represent 81% of total ending deposits at March 31, 2026.

Deposits and Funding

The Company continues to leverage its strong core deposit base, characterized

by low funding costs, to support its financial operations.

· Ending deposits at March 31, 2026 of $14.87 billion were $483.0 million,

or 3.4%, higher than the end of 2025 and were $978.1 million, or 7.0%, higher than one year prior. The growth from December 31, 2025

was primarily due to seasonal inflows of governmental deposit balances while the increase from one year prior was primarily driven by

growth in consumer and business deposit balances, including the $543.7 million of deposits assumed in the Santander branch acquisition.

· Ending borrowings of $647.3 million at March 31, 2026, which included

$438.1 million of fixed rate Federal Home Loan Bank of New York term borrowings, $201.0 million of customer repurchase agreements and

$8.2 million of finance lease liabilities, decreased $42.6 million, or 6.2%, from the end of 2025 and decreased $214.7 million, or 24.9%,

from one year prior. The decreases between both periods reflected decreases in fixed-rate term borrowings and customer repurchase agreements.

· The Company’s average cost of funds of 1.20% decreased 13 basis points

from the first quarter of 2025 and decreased 7 basis points from the fourth quarter of 2025. The decreases between both periods reflected

lower average deposit and borrowing costs and a lower proportion of funding from higher rate borrowings.

· The quarterly average cost of total deposits of 1.10% remains comparatively

low relative to the industry and decreased 7 basis points from the first quarter of 2025 and 5 basis points from the linked fourth quarter.

· 63% of the Company’s total deposits were in no- and relatively low-rate

checking and savings accounts at the end of the first quarter of 2026. Time deposit accounts represented 14% of the Company’s total

deposits at the end of the first quarter of 2026, a decrease of 1 percentage point from both March 31, 2025 and the end of 2025.

Loans and Credit Quality

The Company’s predominantly footprint-based loan portfolio is

well diversified, with credit performance remaining a central priority. The Company’s asset quality metrics, including net charge-offs

and delinquent and nonperforming loan levels, remain strong compared to the banking industry, reflecting the Company’s robust risk

management practices and disciplined credit quality standards.

· Ending loans at March 31, 2026 totaled $11.13 billion, an increase of

$181.4 million, or 1.7%, compared to December 31, 2025 and an increase of $710.0 million, or 6.8%, compared to one year prior. The

increases between both periods primarily reflected organic growth in the overall business and consumer lending portfolios. The Company’s

non-owner occupied and multifamily CRE exposure remains diverse both geographically and by property type, and relatively low at 15% of

total assets, 25% of total loans and 194% of total bank-level regulatory capital.

· At March 31, 2026, the Company’s allowance for credit losses totaled

$90.2 million, or 0.81% of total loans outstanding, compared to $87.9 million, or 0.80% of total loans outstanding, at December 31,

2025, and $82.8 million, or 0.79% of total loans outstanding, at March 31, 2025. The increases were driven by a net reserve build

in the business lending portfolio reflective of organic CRE loan growth.

· The Company recorded a $5.6 million provision for credit losses

during the first quarter of 2026 compared to $5.0 million in the linked fourth quarter and $6.7 million in the prior year’s first

quarter, reflective of organic loan growth and stable credit quality metrics.

· The Company recorded net charge-offs of $3.0 million, or an annualized 0.11%

of average loans, in the first quarter of 2026 compared to net charge-offs of $3.2 million, or an annualized 0.13% of average loans, in

the first quarter of 2025 and net charge-offs of $2.3 million, or an annualized 0.09% of average loans, in the fourth quarter of 2025.

· Total delinquent loans, consisting of loans 30 or more days past due and nonaccrual

loans, as a percentage of total loans outstanding was 1.12% at the end of the first quarter of 2026. This compares to 1.29% at March 31,

2025, and 1.10% at December 31, 2025.

· At March 31, 2026, nonperforming (90 or more days delinquent and non-accruing)

loans were $53.7 million, or 0.48% of total loans outstanding compared to $56.5 million, or 0.52% of total loans outstanding at December 31,

2025, and $75.0 million, or 0.72% of total loans outstanding one year earlier. The decrease in nonperforming loans from the end of the

prior year’s first quarter was primarily attributable to a decrease in nonaccrual business lending loan balances, driven largely

by the derecognition of two CRE loan relationships in the prior year’s second quarter, including one substantially repaid and one

charged off with the collateral transferred to other real estate owned.

Shareholders’ Equity and Regulatory Capital

The Company’s capital planning and management activities, coupled

with its diversified streams of income and prudent dividend practices, have allowed it to build and maintain a strong capital position.

At March 31, 2026, all of the Company’s and Community Bank, N.A.’s regulatory capital ratios significantly exceeded well-capitalized

standards.

· Shareholders’ equity of $2.02 billion at March 31, 2026 was $189.9

million, or 10.4%, higher than one year ago, primarily due to a $119.5 million increase in retained earnings and a $71.0 million decrease

in accumulated other comprehensive loss related to the Company’s investment securities portfolio. Shareholders’ equity increased

$18.0 million, or 0.9%, from December 31, 2025, primarily driven by a $32.5 million increase in retained earnings, partially offset

by $14.8 million increase in treasury stock.

· The Company’s shareholders’ equity to assets ratio was 11.41%

at March 31, 2026, an increase from 10.94% at March 31, 2025 and a decrease from 11.59% at December 31, 2025.

· The Company’s tier 1 leverage ratio of 9.20% at March 31, 2026

remained substantially above the regulatory well-capitalized standard of 5.0% and decreased 9 basis points from one year earlier and decreased

1 basis point from December 31, 2025. The decrease in the Company’s tier 1 leverage ratio from one year prior was primarily

due to the intangible assets added as part of the Santander branch acquisition. The decreases in the Company’s tier 1 leverage ratio

between both periods were also impacted by $15.5 million and $26.6 million of common stock repurchases over the past three and twelve

months, respectively.

· The Company’s tangible equity to tangible assets ratio (non-GAAP) was

6.68% at March 31, 2026, up from 6.15% a year earlier and down from 6.75% at December 31, 2025. Tangible equity (non-GAAP) increased

$146.0 million, or 14.9%, from one year prior due to the aforementioned increase in retained earnings and decrease in accumulated other

comprehensive loss related to the Company’s investment securities portfolio. Tangible assets (non-GAAP) increased $936.7 million,

or 5.9%, from the prior year due primarily to organic loan growth and the Santander branch acquisition.

Dividend Increase and Stock Repurchase Program

The payment of a meaningful and growing dividend is an important component

of the Company’s commitment to provide consistent and favorable long-term returns to its shareholders, and it reflects the continued

strength of the Company’s long-term operating results and capital position, and management’s confidence in the future performance

of the Company. The $0.01 increase in the quarterly dividend declared in the third quarter of 2025 marked the 33rd consecutive

year of dividend increases for the Company.

· During the first quarter of 2026, the Company declared a quarterly cash dividend

of $0.47 per share on its common stock, up 2.2% from the $0.46 dividend declared in the first quarter of 2025.

· On April 22, 2026, the Company announced a quarterly cash dividend of

$0.47 per share on its common stock, payable on July 10, 2026 to shareholders of record as of June 15, 2026, representing an

annualized yield of 3.0% based upon the $63.17 closing price of the Company’s stock on April 28, 2026.

· In December 2025, the Company’s Board of Directors

(the “Board”) approved a stock repurchase program authorizing the repurchase of up to 2.63 million shares, or 5.0% of the

Company’s common stock outstanding during the twelve-month period starting January 1, 2026. Such repurchases may be made at

the discretion of the Company’s senior management based on market conditions and other relevant factors and will be acquired through

open market or privately negotiated transactions as permitted under Rule 10b-18 of the Securities Exchange Act of 1934 and other

applicable regulatory and legal requirements. There were 250,000 shares repurchased pursuant to the 2026 stock repurchase program during

the first quarter of 2026.

Wealth Management Services Expansion with Acquisition of ClearPoint

Federal Bank & Trust

On January 15, 2026, the Company announced that Community Bank,

N.A. has entered into an agreement to acquire ClearPoint Federal Bank & Trust (“ClearPoint”) in an all-cash transaction

for approximately $40 million, subject to potential purchase price adjustments. The transaction significantly expands the revenue and

offerings of Nottingham Financial Group, the Company’s wealth management services business, and contributes to the Company’s

strategic capital deployment into durable, recurring and growing income streams. ClearPoint is a national leader in trust administration

for the approximately $20 billion death care industry, with over $1.5 billion of assets under management and a historical 3-year revenue

CAGR of 9.7%. The Company expects the transaction to close in the second quarter of 2026 subject to the receipt of requisite regulatory

approval and other customary closing conditions.

Non-GAAP Measures

The Company also provides supplemental reporting of its results on an

“operating” and “tangible” basis. Results on an “operating” basis exclude the after-tax effects of

acquisition expenses, restructuring expenses, litigation accrual, unrealized gain (loss) on equity securities and amortization of intangible

assets. Results on a “tangible” basis exclude goodwill and intangible asset balances, net of accumulated amortization and

applicable deferred tax amounts. The Company also provides supplemental ratio reporting at the segment level, which includes adjusted

return on tangible equity. Adjusted return on tangible equity represents annualized adjusted income before income taxes applicable to

each segment as a percentage of average tangible equity for each respective segment. In addition, the Company provides supplemental reporting

for “operating pre-tax, pre-provision net revenues,” which subtracts the provision for credit losses, acquisition expenses,

restructuring expenses, litigation accrual, unrealized gain (loss) on equity securities and amortization of intangible assets from income

before income taxes. Although these items are non-GAAP measures, the Company’s management believes this information helps investors

and analysts measure underlying core performance and provides better comparability to other organizations that have not engaged in acquisitions.

The Company also provides supplemental reporting of its net interest income and net interest margin on a fully tax-equivalent (“FTE”)

basis, which includes an adjustment to net interest income that represents taxes that would have been paid had nontaxable investment securities

and loans been taxable. Although fully tax-equivalent net interest income and net interest margin are non-GAAP measures, the Company’s

management believes this information helps enhance comparability of the performance of assets that have different tax liabilities. The

amounts for such items are presented in the tables that accompany this release.

Conference Call Scheduled

Company management will host a conference call at 11:00 a.m. (ET)

today, April 29, 2026, to discuss the first quarter 2026 results. The conference call can be accessed via webcast at https://app.webinar.net/qplYz5Bw2x6

or via dial-in at 1-833-630-0464 (United States) or 1-412-317-1809 (International).

This earnings release is also available within the ”News”

section of the Company's investor relations website at https://communityfinancialsystem.com/news/.

A replay of the earnings call webcast will also be available on this site for at least one year.

About Community Financial System, Inc.

Community Financial System, Inc. is a diversified financial services

company that is focused on four main business lines – banking services, employee benefit services, insurance services and wealth

management services. Its banking subsidiary, Community Bank, N.A., is among the country’s 100 largest banking institutions with

over $17 billion in assets and operates approximately 200 customer facilities across Upstate New York, Northeastern Pennsylvania, Vermont,

Western Massachusetts and Southern New Hampshire. The Company’s Benefit Plans Administrative Services, Inc. subsidiary is

a leading provider of employee benefits administration, trust services, collective investment fund administration, and actuarial consulting

services to customers on a national scale. The Company’s OneGroup NY, Inc. subsidiary is a top 68 U.S. insurance agency. The

Company also offers comprehensive financial planning, trust administration and wealth management services through its Nottingham Financial

Group operating unit. The Company is listed on the New York Stock Exchange and the Company’s stock trades under the symbol CBU.

For more information about the Company and each of its four main business lines visit https://communityfinancialsystem.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning

of the Private Securities Litigation Reform Act of 1995. These statements are based on the current beliefs and expectations of CBU’s

management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking

statements. The following factors, among others, could cause the actual results of CBU’s operations to differ materially from its

expectations: the macroeconomic and other challenges and uncertainties related to or resulting from current and future economic and market

conditions, including the effects on CRE and housing or vehicle prices, unemployment rates, high inflation, U.S. fiscal debt, budget

and tax matters, geopolitical matters, tariffs and global economic growth; fiscal and monetary policies of the Federal Reserve Board;

the potential adverse effects of unusual and infrequently occurring events; litigation and actions of regulatory authorities; management’s

estimates and projections of interest rates and interest rate policies; the effect of changes in the level of checking, savings, or money

market account deposit balances and other factors that affect net interest margin; future provisions for credit losses on loans and debt

securities; changes in nonperforming assets; ability to contain costs in inflationary conditions; the effect on financial market valuations

on CBU’s fee income businesses, including its employee benefit services, wealth management services, and insurance services businesses;

the successful integration of operations of its acquisitions and performance of new branches; competition; changes in legislation or

regulatory requirements, including capital requirements; and the timing for receiving regulatory approvals and completing merger and

acquisition transactions. For more information about factors that could cause actual results to differ materially from CBU’s expectations,

refer to its annual, periodic and other reports filed with the Securities and Exchange Commission (“SEC”), including the

discussion under the “Risk Factors” section of such reports filed with the SEC and available on CBU’s website at https://communityfinancialsystem.com

and on the SEC’s website at https://sec.gov. Further, any forward-looking statement

speaks only as of the date on which it is made, and CBU undertakes no obligation to update any forward-looking statement to reflect events

or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events.

Summary

of Financial Data (unaudited)

(Dollars

in thousands, except per share data)

2026

2025

1st

Qtr

4th

Qtr

3rd

Qtr

2nd

Qtr

1st

Qtr

Earnings

Loan

income

$154,378

$154,768

$152,509

$146,534

$142,904

Investment

income

25,609

26,699

24,774

26,344

24,743

Total

interest income

179,987

181,467

177,283

172,878

167,647

Interest

expense

45,275

48,042

49,118

48,130

47,435

Net

interest income

134,712

133,425

128,165

124,748

120,212

Provision

for credit losses

5,636

4,979

5,564

4,117

6,690

Net

interest income after provision for credit losses

129,076

128,446

122,601

120,631

113,522

Deposit

service and other banking fees

20,711

23,209

19,980

19,086

18,108

Mortgage

banking

1,100

385

1,180

972

998

Employee

benefit services

34,572

36,564

34,408

32,380

32,622

Insurance

services

12,586

12,684

14,137

13,388

14,201

Wealth

management services

10,332

9,574

8,946

8,683

9,862

Unrealized

(loss) gain on equity securities

(401)

(105)

236

(1)

245

Loss

from equity method investments

(326)

(285)

Total

noninterest revenues

78,574

82,026

78,887

74,508

76,036

Salaries

and employee benefits

80,322

81,920

76,532

79,021

76,442

Data

processing and communications

17,871

18,221

19,119

16,699

16,122

Occupancy

and equipment

14,882

12,646

11,419

11,486

12,698

Business

development and marketing

2,535

3,419

4,585

4,001

3,130

Legal

and professional fees

5,070

4,212

4,469

4,368

4,849

Amortization

of intangible assets

4,246

3,737

3,258

3,369

3,482

Other

8,110

14,397

8,937

10,158

8,567

Total

noninterest expenses

133,036

138,552

128,319

129,102

125,290

Income

before income taxes

74,614

71,920

73,169

66,037

64,268

Income

taxes

17,396

17,498

18,081

14,706

14,654

Net

income

$57,218

$54,422

$55,088

$51,331

$49,614

Basic

earnings per share

$1.08

$1.03

$1.04

$0.97

$0.94

Diluted

earnings per share

$1.08

$1.03

$1.04

$0.97

$0.93

Profitability

(GAAP)

Return

on assets (GAAP)

1.33%

1.26%

1.30%

1.24%

1.22%

Return

on equity (GAAP)

11.51%

11.04%

11.62%

11.21%

11.28%

Noninterest

revenues/total revenues (GAAP)

36.8%

38.1%

37.4%

38.7%

Efficiency

ratio (GAAP)

62.4%

64.3%

62.0%

64.8%

63.8%

Profitability

(non-GAAP)

Operating

return on assets (non-GAAP)

1.42%

1.38%

1.34%

1.28%

Operating

return on equity (non-GAAP)

12.30%

12.08%

12.25%

12.10%

11.84%

Return

on tangible equity (non-GAAP)

21.96%

20.88%

22.27%

22.09%

22.86%

Operating

return on tangible equity (non-GAAP)

22.19%

21.70%

22.43%

22.63%

22.76%

Operating

noninterest revenues/operating revenues (FTE) (non-GAAP)

36.8%

37.9%

37.2%

38.5%

Operating

efficiency ratio (non-GAAP)

59.8%

61.0%

59.9%

62.0%

61.9%

Summary

of Financial Data (unaudited)

(Dollars

in thousands, except per share data)

2026

2025

1st

Qtr

4th

Qtr

3rd

Qtr

2nd

Qtr

1st

Qtr

Components

of Net Interest Margin (FTE)

Loan

yield

5.68%

5.63%

5.58%

Cash

equivalents yield

3.61%

3.84%

3.92%

4.33%

4.30%

Investment

yield

2.10%

2.14%

2.12%

2.17%

2.11%

Earning

asset yield

4.60%

4.59%

4.56%

4.51%

Interest-bearing

deposit rate

1.47%

1.55%

1.59%

Borrowing

rate

3.55%

3.57%

3.82%

3.56%

3.63%

Cost

of all interest-bearing funds

1.59%

1.68%

1.76%

1.74%

1.75%

Cost

of total deposits

1.10%

1.15%

1.17%

1.19%

1.17%

Cost

of funds (includes noninterest-bearing deposits)

1.20%

1.27%

1.33%

1.32%

1.33%

Net

interest margin

3.43%

3.37%

3.30%

3.27%

3.21%

Net

interest margin (FTE) (non-GAAP)

3.45%

3.39%

3.33%

3.30%

3.24%

Fully

tax-equivalent adjustment (non-GAAP)

$850

$875

$880

$884

$894

Average

Balances

Loans

$11,029,905

$10,819,267

$10,664,241

$10,455,637

$10,402,985

Cash

equivalents

230,593

223,700

46,550

159,688

130,649

Taxable

investment securities

4,272,245

4,266,451

4,268,660

4,256,943

4,211,921

Nontaxable

investment securities

407,433

411,771

413,663

417,323

419,746

Total

interest-earning assets

15,940,176

15,721,189

15,393,114

15,289,591

15,165,301

Total

assets

17,468,804

17,179,984

16,755,095

16,590,741

16,439,357

Interest

checking, savings and money market deposits

8,685,727

8,470,840

8,086,979

8,094,208

7,899,568

Time

deposits

2,185,114

2,138,368

2,088,861

2,125,683

2,152,113

Customer

repurchase agreements

214,361

220,670

187,845

240,817

250,142

Overnight

borrowings

9,406

37,554

151,495

16,408

57,192

FHLB

and other borrowings

450,643

462,991

531,979

587,523

602,838

Total

interest-bearing liabilities

11,545,251

11,330,423

11,047,159

11,064,639

10,961,853

Noninterest-bearing

deposits

3,703,510

3,702,200

3,640,964

3,522,734

3,519,962

Shareholders'

equity

2,016,141

1,955,306

1,881,116

1,836,965

1,783,646

Summary

of Financial Data (unaudited)

(Dollars

in thousands, except per share data)

2026

2025

1st

Qtr

4th

Qtr

3rd

Qtr

2nd

Qtr

1st

Qtr

Balance

Sheet Data

Cash

and cash equivalents

$572,173

$301,755

$245,247

$237,248

$518,021

Investment

securities:

Available-for-sale

2,848,132

2,875,341

2,859,312

2,832,370

2,826,915

Held-to-maturity

1,460,750

1,454,166

1,442,308

1,430,991

1,393,837

Equity

and other

81,717

77,252

78,944

86,709

80,591

Total

investment securities

4,390,599

4,406,759

4,380,564

4,350,070

4,301,343

Loans:

Business

lending

4,883,451

4,733,867

4,663,878

4,541,192

4,540,002

Consumer

mortgage

3,619,067

3,617,186

3,544,277

3,523,025

3,504,151

Consumer

indirect

1,894,011

1,859,354

1,834,766

1,767,213

1,707,938

Home

equity

534,439

533,755

510,933

494,183

481,248

Consumer

direct

200,216

205,595

196,408

193,504

187,802

Total

loans

11,131,184

10,949,757

10,750,262

10,519,117

10,421,141

Allowance

for credit losses

90,193

87,921

84,944

81,851

82,840

Goodwill

and intangible assets, net

943,314

942,716

899,967

898,381

900,332

Other

assets

797,782

790,230

766,708

742,053

706,299

Total

assets

17,744,859

17,303,296

16,957,804

16,665,018

16,764,296

Deposits:

Noninterest-bearing

3,732,720

3,683,442

3,686,772

3,588,602

3,526,485

Non-maturity

interest-bearing

8,997,532

8,497,337

8,337,797

8,010,808

8,215,773

Time

2,139,870

2,206,306

2,032,281

2,102,358

2,149,789

Total

deposits

14,870,122

14,387,085

14,056,850

13,701,768

13,892,047

Customer

repurchase agreements

201,027

231,163

224,169

180,621

266,581

Other

borrowings

446,319

458,770

539,180

713,839

595,455

Accrued

interest and other liabilities

203,399

220,244

198,655

185,699

176,138

Total

liabilities

15,720,867

15,297,262

15,018,854

14,781,927

14,930,221

Shareholders'

equity

2,023,992

2,006,034

1,938,950

1,883,091

1,834,075

Total

liabilities and shareholders' equity

17,744,859

17,303,296

16,957,804

16,665,018

16,764,296

Capital

and Other

Shareholders’

equity/total assets (GAAP)

11.41%

11.59%

11.43%

11.30%

10.94%

Tangible

equity/tangible assets (non-GAAP)

6.68%

6.75%

6.73%

6.51%

6.15%

Tier

1 leverage ratio

9.20%

9.21%

9.46%

9.42%

9.29%

Loan-to-deposit

ratio

74.9%

76.1%

76.5%

76.8%

75.0%

Diluted

weighted average common shares outstanding

52,967

52,959

53,036

53,117

53,130

Period

end common shares outstanding

52,537

52,682

52,662

52,869

52,836

Cash

dividends declared per common share

$0.47

$0.46

Book

value (GAAP)

$38.53

$38.08

$36.82

$35.62

$34.71

Tangible

book value (non-GAAP)

$21.40

$21.02

$20.57

$19.46

$18.52

Common

stock price at quarter-end

$58.65

$57.44

$58.64

$56.87

$56.86

Summary

of Financial Data (unaudited)

(Dollars

in thousands, except per share data)

2026

2025

1st

Qtr

4th

Qtr

3rd

Qtr

2nd

Qtr

1st

Qtr

Asset

Quality

Nonaccrual

loans

$47,103

$49,509

$49,327

$45,808

$69,051

Accruing

loans 90+ days delinquent

6,595

6,948

6,730

7,519

5,928

Total

nonperforming loans

53,698

56,457

56,057

53,327

74,979

Other

real estate owned

8,134

8,209

7,851

7,954

2,746

Total

nonperforming assets

61,832

64,666

63,908

61,281

77,725

Net

charge-offs

2,972

2,328

2,471

5,114

3,229

Allowance

for credit losses/loans outstanding

0.81%

0.80%

0.79%

0.78%

0.79%

Nonperforming

loans/loans outstanding

0.48%

0.52%

0.51%

0.72%

Allowance

for credit losses/nonperforming loans

168%

156%

152%

153%

110%

Net

charge-offs/average loans

0.11%

0.09%

0.20%

0.13%

Delinquent

loans/ending loans

1.12%

1.10%

1.00%

1.01%

1.29%

Provision

for credit losses/net charge-offs

190%

214%

225%

80%

207%

Nonperforming

assets/total assets

0.35%

0.37%

0.38%

0.37%

0.46%

Quarterly

GAAP to Non-GAAP Reconciliations

Operating

pre-tax, pre-provision net revenue (non-GAAP)

Net

income (GAAP)

$57,218

$54,422

$55,088

$51,331

$49,614

Income

taxes

17,396

17,498

18,081

14,706

14,654

Income

before income taxes

74,614

71,920

73,169

66,037

64,268

Provision

for credit losses

5,636

4,979

5,564

4,117

6,690

Pre-tax,

pre-provision net revenue (non-GAAP)

80,250

76,899

78,733

70,154

70,958

Acquisition

expenses

433

2,848

747

Restructuring

expenses

(26)

1,525

Litigation

accrual

(50)

Unrealized

loss (gain) on equity securities

401

105

(236)

(245)

Amortization

of intangible assets

4,246

3,737

3,258

3,369

3,482

Operating

pre-tax, pre-provision net revenue (non-GAAP)

$85,330

$83,563

$82,502

$75,116

$74,146

Operating

pre-tax, pre-provision net revenue per share (non-GAAP)

Diluted

earnings per share (GAAP)

$1.08

$1.03

$1.04

$0.97

$0.93

Income

taxes

0.33

0.34

0.27

0.28

Income

before income taxes

1.41

1.36

1.38

1.24

1.21

Provision

for credit losses

0.11

0.10

0.11

0.08

0.12

Pre-tax,

pre-provision net revenue per share (non-GAAP)

1.52

1.46

1.49

1.32

1.33

Acquisition

expenses

0.01

0.05

0.01

0.00

Restructuring

expenses

0.00

0.03

0.00

Litigation

accrual

0.00

Unrealized

loss (gain) on equity securities

0.00

Amortization

of intangible assets

0.08

0.07

0.06

0.07

Operating

pre-tax, pre-provision net revenue per share (non-GAAP)

$1.61

$1.58

$1.56

$1.41

$1.40

Summary

of Financial Data (unaudited)

(Dollars

in thousands, except per share data)

2026

2025

1st

Qtr

4th

Qtr

3rd

Qtr

2nd

Qtr

1st

Qtr

Quarterly

GAAP to Non-GAAP Reconciliations

Operating

net income (non-GAAP)

Net

income (GAAP)

$57,218

$54,422

$55,088

$51,331

$49,614

Acquisition

expenses

433

2,848

747

Tax

effect of acquisition expenses

(99)

(658)

(155)

(12)

Subtotal

(non-GAAP)

57,552

56,612

55,680

51,386

49,615

Restructuring

expenses

(26)

1,525

Tax

effect of restructuring expenses

(274)

Subtotal

(non-GAAP)

57,552

56,592

55,680

52,637

49,615

Litigation

accrual

(50)

Tax

effect of litigation accrual

Subtotal

(non-GAAP)

57,552

56,592

55,680

52,637

49,577

Unrealized

loss (gain) on equity securities

401

105

(236)

(245)

Tax

effect of unrealized loss (gain) on equity securities

(91)

(24)

Subtotal

(non-GAAP)

57,862

56,673

55,493

52,638

49,389

Amortization

of intangible assets

4,246

3,737

3,258

3,369

3,482

Tax

effect of amortization of intangible assets

(967)

(863)

(677)

(605)

(804)

Operating

net income (non-GAAP)

$61,141

$59,547

$58,074

$55,402

$52,067

Operating

diluted earnings per share (non-GAAP)

Diluted

earnings per share (GAAP)

$1.08

$1.03

$1.04

$0.97

$0.93

Acquisition

expenses

0.01

0.05

0.01

0.00

Tax

effect of acquisition expenses

0.00

(0.01)

0.00

Subtotal

(non-GAAP)

1.09

1.07

1.05

0.97

0.93

Restructuring

expenses

0.00

0.03

0.00

Tax

effect of restructuring expenses

0.00

(0.01)

0.00

Subtotal

(non-GAAP)

1.09

1.07

1.05

0.99

0.93

Litigation

accrual

0.00

Tax

effect of litigation accrual

0.00

Subtotal

(non-GAAP)

1.09

1.07

1.05

0.99

0.93

Unrealized

loss (gain) on equity securities

0.00

Tax

effect of unrealized loss (gain) on equity securities

0.00

Subtotal

(non-GAAP)

1.09

1.07

1.05

0.99

0.93

Amortization

of intangible assets

0.08

0.07

0.06

0.07

Tax

effect of amortization of intangible assets

(0.02)

(0.01)

(0.02)

Operating

diluted earnings per share (non-GAAP)

$1.15

$1.12

$1.09

$1.04

$0.98

Summary

of Financial Data (unaudited)

(Dollars

in thousands, except per share data)

2026

2025

1st

Qtr

4th

Qtr

3rd

Qtr

2nd

Qtr

1st

Qtr

Quarterly

GAAP to Non-GAAP Reconciliations

Return

on assets

Net

income (GAAP)

$57,218

$54,422

$55,088

$51,331

$49,614

Average

total assets

17,468,804

17,179,984

16,755,095

16,590,741

16,439,357

Return

on assets (GAAP)

1.33%

1.26%

1.30%

1.24%

1.22%

Operating

return on assets (non-GAAP)

Operating

net income (non-GAAP)

$61,141

$59,547

$58,074

$55,402

$52,067

Average

total assets

17,468,804

17,179,984

16,755,095

16,590,741

16,439,357

Operating

return on assets (non-GAAP)

1.42%

1.38%

1.34%

1.28%

Return

on equity

Net

income (GAAP)

$57,218

$54,422

$55,088

$51,331

$49,614

Average

total equity

2,016,141

1,955,306

1,881,116

1,836,965

1,783,646

Return

on equity (GAAP)

11.51%

11.04%

11.62%

11.21%

11.28%

Operating

return on equity (non-GAAP)

Operating

net income (non-GAAP)

$61,141

$59,547

$58,074

$55,402

$52,067

Average

total equity

2,016,141

1,955,306

1,881,116

1,836,965

1,783,646

Operating

return on equity (non-GAAP)

12.30%

12.08%

12.25%

12.10%

11.84%

Net

interest margin

Net

interest income

$134,712

$133,425

$128,165

$124,748

$120,212

Total

average interest-earning assets

15,940,176

15,721,189

15,393,114

15,289,591

15,165,301

Net

interest margin

3.43%

3.37%

3.30%

3.27%

3.21%

Net

interest margin (FTE) (non-GAAP)

Net

interest income

$134,712

$133,425

$128,165

$124,748

$120,212

Fully

tax-equivalent adjustment (non-GAAP)

850

875

880

884

894

Fully

tax-equivalent net interest income (non-GAAP)

135,562

134,300

129,045

125,632

121,106

Total

average interest-earning assets

15,940,176

15,721,189

15,393,114

15,289,591

15,165,301

Net

interest margin (FTE) (non-GAAP)

3.45%

3.39%

3.33%

3.30%

3.24%

Operating

noninterest revenues (non-GAAP)

Noninterest

revenues (GAAP)

$78,574

$82,026

$78,887

$74,508

$76,036

Unrealized

loss (gain) on equity securities

401

105

(236)

(245)

Total

operating noninterest revenues (non-GAAP)

$78,975

$82,131

$78,651

$74,509

$75,791

Operating

noninterest expenses (non-GAAP)

Noninterest

expenses (GAAP)

$133,036

$138,552

$128,319

$129,102

$125,290

Acquisition

expenses

(433)

(2,848)

(747)

(67)

(1)

Restructuring

expenses

(1,525)

Litigation

accrual

Amortization

of intangible assets

(4,246)

(3,737)

(3,258)

(3,369)

(3,482)

Total

operating noninterest expenses (non-GAAP)

$128,357

$131,993

$124,314

$124,141

$121,857

Summary

of Financial Data (unaudited)

(Dollars

in thousands, except per share data)

2026

2025

1st

Qtr

4th

Qtr

3rd

Qtr

2nd

Qtr

1st

Qtr

Quarterly

GAAP to Non-GAAP Reconciliations

Operating

revenues (non-GAAP)

Net

interest income (GAAP)

$134,712

$133,425

$128,165

$124,748

$120,212

Noninterest

revenues (GAAP)

78,574

82,026

78,887

74,508

76,036

Total

revenues (GAAP)

213,286

215,451

207,052

199,256

196,248

Unrealized

loss (gain) on equity securities

401

105

(236)

(245)

Total

operating revenues (non-GAAP)

$213,687

$215,556

$206,816

$199,257

$196,003

Noninterest

revenues/total revenues

Total

noninterest revenues (GAAP) – numerator

$78,574

$82,026

$78,887

$74,508

$76,036

Total

revenues (GAAP) – denominator

213,286

215,451

207,052

199,256

196,248

Noninterest

revenues/total revenues (GAAP)

36.8%

38.1%

37.4%

38.7%

Operating

noninterest revenues/operating revenues (FTE) (non-GAAP)

Total

operating noninterest revenues (non-GAAP) – numerator

$78,975

$82,131

$78,651

$74,509

$75,791

Total

operating revenues (non-GAAP)

213,687

215,556

206,816

199,257

196,003

Fully

tax-equivalent adjustment (non-GAAP)

850

875

880

884

894

Total

operating revenues (FTE) (non-GAAP) – denominator

214,537

216,431

207,696

200,141

196,897

Operating

noninterest revenues/operating revenues (FTE) (non-

GAAP)

36.8%

37.9%

37.2%

38.5%

Efficiency

ratio (GAAP)

Total

noninterest expenses (GAAP) – numerator

$133,036

$138,552

$128,319

$129,102

$125,290

Total

revenues (GAAP) – denominator

213,286

215,451

207,052

199,256

196,248

Efficiency

ratio (GAAP)

62.4%

64.3%

62.0%

64.8%

63.8%

Operating

efficiency ratio (non-GAAP)

Total

operating noninterest expenses (non-GAAP) - numerator

$128,357

$131,993

$124,314

$124,141

$121,857

Total

operating revenues (FTE) (non-GAAP) - denominator

214,537

216,431

207,696

200,141

196,897

Operating

efficiency ratio (non-GAAP)

59.8%

61.0%

59.9%

62.0%

61.9%

Total

tangible assets (non-GAAP)

Total

assets (GAAP)

$17,744,859

$17,303,296

$16,957,804

$16,665,018

$16,764,296

Goodwill

and intangible assets, net

(943,314)

(942,716)

(899,967)

(898,381)

(900,332)

Deferred

taxes on goodwill and intangible assets, net

43,752

43,905

44,130

44,336

44,644

Total

tangible assets (non-GAAP)

$16,845,297

$16,404,485

$16,101,967

$15,810,973

$15,908,608

Total

tangible common equity (non-GAAP)

Shareholders'

equity (GAAP)

$2,023,992

$2,006,034

$1,938,950

$1,883,091

$1,834,075

Goodwill

and intangible assets, net

(943,314)

(942,716)

(899,967)

(898,381)

(900,332)

Deferred

taxes on goodwill and intangible assets, net

43,752

43,905

44,130

44,336

44,644

Total

tangible common equity (non-GAAP)

$1,124,430

$1,107,223

$1,083,113

$1,029,046

$978,387

Summary

of Financial Data (unaudited)

(Dollars

in thousands, except per share data)

2026

2025

1st

Qtr

4th

Qtr

3rd

Qtr

2nd

Qtr

1st

Qtr

Quarterly

GAAP to Non-GAAP Reconciliations

Shareholders’

equity-to-assets ratio at quarter end

Total

shareholders’ equity (GAAP) – numerator

$2,023,992

$2,006,034

$1,938,950

$1,883,091

$1,834,075

Total

assets (GAAP) – denominator

17,744,859

17,303,296

16,957,804

16,665,018

16,764,296

Shareholders’

equity-to-assets ratio at quarter end (GAAP)

11.41%

11.59%

11.43%

11.30%

10.94%

Tangible

equity-to-tangible assets ratio at quarter end (non-GAAP)

Total

tangible common equity (non-GAAP) - numerator

$1,124,430

$1,107,223

$1,083,113

$1,029,046

$978,387

Total

tangible assets (non-GAAP) - denominator

16,845,297

16,404,485

16,101,967

15,810,973

15,908,608

Tangible

equity-to-tangible assets ratio at quarter end (non-GAAP)

6.68%

6.75%

6.73%

6.51%

6.15%

Return

on tangible equity (non-GAAP)

Net

income (GAAP)

$57,218

$54,422

$55,088

$51,331

$49,614

Amortization

of intangible assets, net of tax

3,279

2,874

2,581

2,764

2,678

Net

income, excluding amortization of intangible assets (non-GAAP)

60,497

57,296

57,669

54,095

52,292

Average

shareholders’ equity

2,016,141

1,955,306

1,881,116

1,836,965

1,783,646

Average

goodwill and intangible assets, net

(942,701)

(910,627)

(897,943)

(899,416)

(900,530)

Average

deferred taxes on goodwill and intangible assets, net

43,829

44,018

44,233

44,490

44,631

Average

tangible common equity (non-GAAP)

1,117,269

1,088,697

1,027,406

982,039

927,747

Return

on tangible equity (non-GAAP)

21.96%

20.88%

22.27%

22.09%

22.86%

Operating

return on tangible equity (non-GAAP)

Operating

net income (non-GAAP)

$61,141

$59,547

$58,074

$55,402

$52,067

Average

tangible common equity (non-GAAP)

1,117,269

1,088,697

1,027,406

982,039

927,747

Operating

return on tangible equity (non-GAAP)

22.19%

21.70%

22.43%

22.63%

22.76%

Book

value (GAAP)

Total

shareholders’ equity (GAAP) – numerator

$2,023,992

$2,006,034

$1,938,950

$1,883,091

$1,834,075

Period

end common shares outstanding – denominator

52,537

52,682

52,662

52,869

52,836

Book

value (GAAP)

$38.53

$38.08

$36.82

$35.62

$34.71

Tangible

book value (non-GAAP)

Total

tangible common equity (non-GAAP) – numerator

$1,124,430

$1,107,223

$1,083,113

$1,029,046

$978,387

Period

end common shares outstanding – denominator

52,537

52,682

52,662

52,869

52,836

Tangible

book value (non-GAAP)

$21.40

$21.02

$20.57

$19.46

$18.52

2026

2025

1st

Qtr

4th

Qtr

1st

Qtr

Quarterly

Segment Information Reconciliations

Reconciliation

of total segment adjusted income before income taxes to total consolidated income before income taxes

Total

segment adjusted income before income taxes

$79,694

$78,584

$67,456

Unrealized

(loss) gain on equity securities

(401)

(105)

245

Amortization

of intangible assets

(4,246)

(3,737)

(3,482)

Restructuring

expenses

Litigation

accrual

Acquisition

expenses

(433)

(2,848)

(1)

Total

consolidated income before income taxes

$74,614

$71,920

$64,268

Summary

of Financial Data (unaudited)

(Dollars

in thousands, except per share data)

2026

2025

1st

Qtr

4th

Qtr

1st

Qtr

Quarterly

Segment Information Reconciliations

Reconciliation

of average total segment assets to average total consolidated assets

Average

total segment assets

$17,593,896

$17,298,866

$16,555,552

Elimination

of intersegment cash and deposits

(125,092)

(118,882)

(116,195)

Average

total consolidated assets

$17,468,804

$17,179,984

$16,439,357

Banking

and Corporate

Adjusted

return on assets

Adjusted

income before income taxes

$59,611

$58,467

$46,273

Average

segment assets

17,192,358

16,916,167

16,213,158

Adjusted

return on assets

1.41%

1.37%

1.16%

Adjusted

return on equity

Adjusted

income before income taxes

$59,611

$58,467

$46,273

Average

shareholders’ equity

1,667,914

1,616,116

1,489,739

Adjusted

return on equity

14.49%

14.35%

12.60%

Adjusted

return on tangible equity (non-GAAP)

Adjusted

income before income taxes

$59,611

$58,467

$46,273

Average

shareholders’ equity

1,667,914

1,616,116

1,489,739

Average

goodwill and intangible assets, net

(779,128)

(749,254)

(738,052)

Average

deferred taxes on goodwill and intangible assets, net

40,533

40,541

40,222

Average

tangible common equity (non-GAAP)

929,319

907,403

791,909

Adjusted

return on tangible equity (non-GAAP)

26.01%

25.56%

23.70%

Employee

Benefit Services

Adjusted

return on assets

Adjusted

income before income taxes

$14,327

$15,997

$13,440

Average

segment assets

249,917

236,762

232,461

Adjusted

return on assets

23.25%

26.81%

23.45%

Adjusted

return on equity

Adjusted

income before income taxes

$14,327

$15,997

$13,440

Average

shareholders’ equity

217,387

210,344

205,608

Adjusted

return on equity

26.73%

30.17%

26.51%

Adjusted

return on tangible equity (non-GAAP)

Adjusted

income before income taxes

$14,327

$15,997

$13,440

Average

shareholders’ equity

217,387

210,344

205,608

Average

goodwill and intangible assets, net

(109,742)

(110,144)

(112,746)

Average

deferred taxes on goodwill and intangible assets, net

3,127

3,579

4,405

Average

tangible common equity (non-GAAP)

110,772

103,779

97,267

Adjusted

return on tangible equity (non-GAAP)

52.45%

61.16%

56.04%

Summary

of Financial Data (unaudited)

(Dollars

in thousands, except per share data)

2026

2025

1st

Qtr

4th

Qtr

1st

Qtr

Quarterly

Segment Information Reconciliations

Insurance

Services

Adjusted

return on assets

Adjusted

income before income taxes

$1,849

$929

$4,108

Average

segment assets

109,005

104,924

71,923

Adjusted

return on assets

6.88%

3.51%

23.16%

Adjusted

return on equity

Adjusted

income before income taxes

$1,849

$929

$4,108

Average

shareholders’ equity

93,172

92,004

54,538

Adjusted

return on equity

8.05%

4.01%

30.55%

Adjusted

return on tangible equity (non-GAAP)

Adjusted

income before income taxes

$1,849

$929

$4,108

Average

shareholders’ equity

93,172

92,004

54,538

Average

goodwill and intangible assets, net

(48,682)

(47,044)

(45,205)

Average

deferred taxes on goodwill and intangible assets, net

(160)

(329)

(279)

Average

tangible common equity (non-GAAP)

44,330

44,631

9,054

Adjusted

return on tangible equity (non-GAAP)

16.92%

8.26%

184.01%

Wealth

Management Services

Adjusted

return on assets

Adjusted

income before income taxes

$3,907

$3,191

$3,635

Average

segment assets

42,616

41,013

38,010

Adjusted

return on assets

37.18%

30.87%

38.78%

Adjusted

return on equity

Adjusted

income before income taxes

$3,907

$3,191

$3,635

Average

shareholders’ equity

37,668

36,842

33,761

Adjusted

return on equity

42.07%

34.36%

43.67%

Adjusted

return on tangible equity (non-GAAP)

Adjusted

income before income taxes

$3,907

$3,191

$3,635

Average

shareholders’ equity

37,668

36,842

33,761

Average

goodwill and intangible assets, net

(5,149)

(4,185)

(4,527)

Average

deferred taxes on goodwill and intangible assets, net

329

227

283

Average

tangible common equity (non-GAAP)

32,848

32,884

29,517

Adjusted

return on tangible equity (non-GAAP)

48.24%

38.50%

49.94%

# # #

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Cover

Apr. 29, 2026

Cover [Abstract]

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Entity File Number

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Entity Registrant Name

COMMUNITY FINANCIAL SYSTEM, INC.

Entity Central Index Key

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Entity Tax Identification Number

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Entity Incorporation, State or Country Code

Entity Address, Address Line One

333 Butternut Drive

Entity Address, City or Town

Syracuse

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Code for the postal or zip code

+ References

No definition available.

+ Details

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- Definition

Name of the state or province.

+ References

No definition available.

+ Details

Name:

dei_EntityAddressStateOrProvince

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Period Type:

duration

- Definition

A unique 10-digit SEC-issued value to identify entities that have filed disclosures with the SEC. It is commonly abbreviated as CIK.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher SEC

-Name Exchange Act

-Number 240

-Section 12

-Subsection b-2

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dei_EntityCentralIndexKey

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Balance Type:

Period Type:

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- Definition

Indicate if registrant meets the emerging growth company criteria.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher SEC

-Name Exchange Act

-Number 240

-Section 12

-Subsection b-2

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Name:

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- Definition

Commission file number. The field allows up to 17 characters. The prefix may contain 1-3 digits, the sequence number may contain 1-8 digits, the optional suffix may contain 1-4 characters, and the fields are separated with a hyphen.

+ References

No definition available.

+ Details

Name:

dei_EntityFileNumber

Namespace Prefix:

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Balance Type:

Period Type:

duration

- Definition

Two-character EDGAR code representing the state or country of incorporation.

+ References

No definition available.

+ Details

Name:

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Data Type:

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Period Type:

duration

- Definition

The exact name of the entity filing the report as specified in its charter, which is required by forms filed with the SEC.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher SEC

-Name Exchange Act

-Number 240

-Section 12

-Subsection b-2

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Name:

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- Definition

The Tax Identification Number (TIN), also known as an Employer Identification Number (EIN), is a unique 9-digit value assigned by the IRS.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher SEC

-Name Exchange Act

-Number 240

-Section 12

-Subsection b-2

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Name:

dei_EntityTaxIdentificationNumber

Namespace Prefix:

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Period Type:

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- Definition

Local phone number for entity.

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No definition available.

+ Details

Name:

dei_LocalPhoneNumber

Namespace Prefix:

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- Definition

Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher SEC

-Name Exchange Act

-Number 240

-Section 13e

-Subsection 4c

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Name:

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Namespace Prefix:

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Balance Type:

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- Definition

Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher SEC

-Name Exchange Act

-Number 240

-Section 14d

-Subsection 2b

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Name:

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- Definition

Title of a 12(b) registered security.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher SEC

-Name Exchange Act

-Number 240

-Section 12

-Subsection b

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Period Type:

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- Definition

Name of the Exchange on which a security is registered.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher SEC

-Name Exchange Act

-Number 240

-Section 12

-Subsection d1-1

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Name:

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Namespace Prefix:

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Data Type:

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Balance Type:

Period Type:

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- Definition

Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as soliciting material pursuant to Rule 14a-12 under the Exchange Act.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher SEC

-Name Exchange Act

-Number 240

-Section 14a

-Subsection 12

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Name:

dei_SolicitingMaterial

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Data Type:

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- Definition

Trading symbol of an instrument as listed on an exchange.

+ References

No definition available.

+ Details

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Namespace Prefix:

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Balance Type:

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- Definition

Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as written communications pursuant to Rule 425 under the Securities Act.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher SEC

-Name Securities Act

-Number 230

-Section 425

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