About Arrow Financial

Arrow Financial Corporation provides a broad range of commercial and consumer banking and financial products. The company is a two-bank holding company headquartered in Glens Falls, New York. The banking subsidiaries are Glens Falls National Bank and Trust Company (Glens Falls National or GFNB) whose main office is located in Glens Falls, New York, and Saratoga National Bank and Trust Company (Saratoga National or SNB) whose main office is located in Saratoga Springs, New York. Active subsidiaries of Glens Falls National include Upstate Agency, LLC (an insurance agency that sells property and casualty insurance and also specializes in selling and servicing group health care policies and life insurance), North Country Investment Advisers, Inc. (a registered investment adviser that provides investment advice to Arrow's proprietary mutual fund) and Arrow Properties, Inc. (a real estate investment trust, or REIT). The company also owns directly two subsidiary business trusts, organized in 2003 and 2004 to issue trust preferred securities (TRUPs), which are still outstanding. The company targets lending activities to consumers and small- and mid-sized companies in Arrow's regional geographic area. In addition, through an indirect lending program the company acquires consumer loans from an extensive network of automobile dealers that operate in New York and Vermont. Through the banks' trust operations, the company provides retirement planning, trust and estate administration services for individuals, and pension, profit-sharing and employee benefit plan administration for corporations. Lending Activities The company engages in a wide range of lending activities, including commercial and industrial lending primarily to small and mid-sized companies; mortgage lending for residential and commercial properties; and consumer installment and home equity financing. An active indirect lending program is maintained through the company’s sponsorship of automobile dealer programs under which consumer auto loans, primarily from dealers that meet pre-established specifications are purchased. From time to time, a portion of the company’s residential real estate loan originations are sold into the secondary market, primarily to the Federal Home Loan Mortgage Corporation (Freddie Mac) and other governmental agencies. The company lends primarily to borrowers within the normal retail service area in northeastern New York State, with the exception of the indirect consumer lending line of business, where it acquires retail paper from an extensive network of automobile dealers that operate in a larger area of New York and Vermont. The company buys and offers participations in individual loans, typically commercial loans, in New York and adjacent states. The company also participated as a lender in the Paycheck Protection Program (PPP) administered by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act). Investment Portfolio As of December 31, 2022, the company’s investment portfolio included U.S. government and agency obligations; state and municipal obligations; mortgage-backed securities; and corporate and other debt securities. Deposits As of December 31, 2022, the company’s deposits included demand deposits; interest-bearing checking accounts; savings deposits; time deposits of $250,000 or more; and other time deposits. Supervision and Regulation The company is a registered bank holding company within the meaning of the Bank Holding Company Act of 1956 (BHC Act) and as such is subject to regulation by the Board of Governors of the Federal Reserve System (FRB). As a ‘bank holding company’ under New York State law, the company is also subject to regulation by the New York State Department of Financial Services. The company’s two subsidiary banks are both national banks and are subject to supervision and examination by the Office of the Comptroller of the Currency (OCC). The banks are members of the Federal Reserve System and the deposits of each bank are insured by the Deposit Insurance Fund of the Federal Deposit Insurance Corporation (FDIC). The insurance agency subsidiary of Glens Falls National is subject to the licensing and other provisions of New York State Insurance Law and is regulated by the New York State Department of Financial Services. The company’s investment adviser subsidiary is subject to the licensing and other provisions of the federal Investment Advisers Act of 1940 and is regulated by the Securities and Exchange Commission (SEC). Transactions between banks and their ‘affiliates’ are regulated by Sections 23A and 23B of the Federal Reserve Act (FRA). Each of the company’s non-bank subsidiaries (other than the business trusts formed to issue the TRUPs) is a subsidiary of one of the subsidiary banks, and also is an ‘operating subsidiary’ under Sections 23A and 23B. The company’s subsidiary banks are subject to the Community Reinvestment Act (CRA) and implementing regulations. The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank) required the federal bank regulatory agencies and the SEC to establish joint regulations or guidelines prohibiting incentive-based payment arrangements at specified regulated entities, such as the company, having at least $1 billion in total assets that encourage inappropriate risks by providing an executive officer, employee, director or principal shareholder with excessive compensation, fees, or benefits or that could lead to material financial loss to the entity. History Arrow Financial Corporation was founded in 1851. The company, a New York corporation, was incorporated in 1983. ed in 1983.