Tompkins Financial Raises Quarterly Dividend 5.7% to $0.74

Tompkins Financial Corporation raised its quarterly dividend 5.7% to $0.74 a share from $0.70. TMP shares trade ex-dividend on November 6, 2026, and the payment is due November 13, 2026.

Why the dividend changed

Tompkins linked the increase to improved earnings and a stronger capital position. President and Chief Executive Stephen Romaine said consistent loan and deposit growth and further expansion in the net interest margin were sustaining the company’s momentum. The board declared the dividend on October 22, 2026, alongside the regional bank’s third-quarter results. The SEC filing confirms the declaration and payment terms.

Third-quarter diluted earnings per share rose 21.2% from a year earlier to $2.00, while net income increased 21.0% to $28.7 million. For the first nine months of 2026, diluted earnings per share and net income each rose 29.6%. Those gains provide the immediate business context for the dividend decision. Tompkins’ third-quarter earnings release details the results.

The bank’s net interest margin widened to 3.65% from 3.20% a year earlier as average loan balances and earning-asset yields increased and funding costs declined. Period-end loans grew 6.9% from a year earlier, while deposits grew 5.0%. Net interest income rose 21.0% to $77.3 million, reinforcing the core earnings available to support capital returns.

The quarter also contained offsetting developments. Noninterest income fell 46.7%, primarily because Tompkins sold its insurance subsidiary in the fourth quarter of 2025. Noninterest expense declined 8.8% for the same reason. The sale makes year-over-year revenue and expense comparisons less representative of the remaining banking and wealth-management businesses, but it does not constitute a split, merger or spin-off affecting the dividend.

Dividend track record

The new payment continues a pattern of several incremental increases rather than one annual adjustment. The quarterly dividend was $0.62 for the February, May and August 2025 ex-dividend dates, followed by $0.65 in November 2025. It moved to $0.67 in February and May 2026, then $0.70 in August and now $0.74.

Full-year distributions rose from $2.10 a share in 2020 to $2.19 in 2021, $2.31 in 2022, $2.40 in 2023, $2.44 in 2024 and $2.51 in 2025. The annual increases ranged from 1.7% to 5.5% over that period. The latest increase is above the 3.6% annual growth rate over the past five years.

Tompkins has increased its dividend for 20 consecutive years. The sequence of recent quarterly payments shows that management has accelerated the rate of increases during 2026, with three different payment levels during the year.

Is the dividend covered?

The dividend consumes 21% of earnings. That payout ratio indicates that most earnings are being retained rather than distributed, leaving room to absorb ordinary fluctuations in bank profitability while supporting lending, regulatory capital and other corporate uses.

SmarterDividends rates the dividend A, with a safety score of 95. That falls in the “very safe” range of 80-100 and reflects the low earnings payout and established growth record. The grade describes current coverage and financial capacity, not a guarantee that future payments will remain unchanged.

Capital measures support that assessment. Tompkins said its capital ratios remained well above the regulatory thresholds for a well-capitalized institution. Its total capital ratio was 14.89% at September 30, 2026, while its Tier 1 leverage ratio was 10.73%. The company also reported $1.5 billion of available liquidity.

Yield and valuation

The annualized dividend is $2.96 a share, producing a 2.89% forward yield at a share price of $102.19. That yield trails the 5.84% median for the Financial Services sector. An investor holding 100 shares would receive $296.00 in annual dividend income at the new rate.

SmarterDividends estimates fair value at $180.21 and classifies the shares as undervalued, representing 78% upside to that estimate. The valuation figure is an estimate rather than a forecast, and the stock has already recorded a 46.4% gain over the past year.

What to watch

The immediate dates are November 6, 2026, when the shares trade ex-dividend, and November 13, 2026, when the payment is scheduled. The next quarterly results will show whether net interest-margin expansion and loan and deposit growth continue to support earnings coverage.

Credit quality is another relevant measure. Special Mention and Substandard loans increased during the third quarter, primarily because of two commercial real-estate relationships. Tompkins said the collateral securing those credits remained sufficient to mitigate potential losses, but provision expense rose from the prior quarter. Future disclosures on those loans, nonperforming assets and regulatory capital will help show whether the current coverage cushion is being maintained.