Chemung Financial Corporation (CHMG): Business Model Canvas [Dec-2025 Updated]

You're trying to get a clear picture of Chemung Financial Corporation's game plan, and frankly, the recent balance sheet repositioning is the key to understanding where they're headed. Forget the fluff; this is about a bank with assets around \$2.852 billion as of mid-2025, which just made a major move selling \$245.5 million in securities to refine its focus while pushing commercial lending growth. To see precisely how they connect their deep-rooted community trust with the \$2.313 billion managed by their wealth group and generate that \$22.7 million in quarterly Net Interest Income, you need to look at the full nine blocks of their operation below.

Chemung Financial Corporation (CHMG) - Canvas Business Model: Key Partnerships

Local non-profit organizations for community investment and sponsorship

• Volunteering Over. 13,000 Hours

Technology vendors for the GoBanking digital platform and core processing

• Digital platform: GoBanking

Correspondent banks and financial institutions for liquidity and capital markets

• Federal Home Loan Bank of New York advance line capacity as of June 30, 2025: $170.2 million
• Federal Home Loan Bank of New York utilized capacity as of June 30, 2025: $55.0 million
• Federal Home Loan Bank of New York available borrowing capacity as of June 30, 2025: $115.2 million
• ABA Routing Number: 021301115

Accredited investors and qualified institutional buyers for the $45.0 million subordinated debt issuance

Local businesses and educational institutions (e.g., Cornell, SUNY Binghamton) for commercial lending

• Allowance for credit losses on loans to total loans as of March 31, 2025: 1.07%
• Total assets as of June 30, 2025: $2.9 billion
• Commercial loan growth reported for Q1 2025: 10.5%

Chemung Financial Corporation (CHMG) - Canvas Business Model: Key Activities

You're looking at the core actions Chemung Financial Corporation takes to run its business as of late 2025, based on the latest reported figures.

Core commercial and consumer lending, including a focus on commercial real estate

The lending engine is clearly focused on growth, especially in commercial sectors. Loan growth in the third quarter of 2025 totaled $69.9 million. This followed a 5.0% annual loan growth for the year ended December 31, 2024, with commercial real estate growing 8.4% that year. Asset quality remains a key focus, with non-performing loans (NPLs) to total loans improving to 0.35% as of September 30, 2025. Total loans, net of deferred loan fees, stood at $2,071,419 thousand at year-end 2024. Management noted continued commercial loan momentum across its markets.

Deposit gathering and funding cost management to optimize the net interest margin

A major activity involved aggressively managing the funding mix to lower costs. This included the payoff of all outstanding brokered deposits during July 2025 as part of the balance sheet repositioning. Consequently, brokered deposits were reported at $0 as of September 30, 2025. This shift helped drive the cost of funds down to 1.85% in Q3 2025. The net interest margin (NIM) benefited directly, expanding 40 basis points quarter-over-quarter to reach 3.45% in Q3 2025. Total deposits were $2,396,883 thousand at the end of 2024.

• Cost of Funds (Q3 2025): 1.85%
• Net Interest Margin (Q3 2025): 3.45%
• Brokered Deposits (9/30/2025): $0
• Total Deposits (12/31/2024): $2,396,883 thousand

Wealth management and trust services through Chemung Canal Trust Company

The Wealth Management Group (WMG) is a key non-interest income generator. The market value of total assets under management or administration reached $2.393 billion as of September 30, 2025. For the first nine months of 2025 year-to-date, WMG Income was $8.8 Million. This followed a record revenue year in 2024, where WMG fee income increased by $1.1 million year-over-year. The trust services include activities as Fiduciary and Custodian.

Strategic balance sheet repositioning, like the Q2 $245.5 million securities sale

Chemung Financial Corporation executed a transformational balance sheet repositioning in the second quarter of 2025. This involved the sale of available-for-sale securities with a book value of $245.5 million in June 2025, which generated proceeds totaling $227.3 million and resulted in a pre-tax loss of $17.5 million. This action was done in conjunction with the issuance of $45.0 million in aggregate principal amount of 7.75% Fixed-to-Floating Rate Subordinated Notes on June 10, 2025, which qualify as Tier 2 capital. The repositioning immediately impacted earnings, with Q2 2025 reporting a net loss of $6.5 million, but it set up an immediate Net Interest Income (NII) uplift of $1.9 million quarter-over-quarter in Q3 2025.

• Securities Sold (Book Value): $245.5 million (Q2 2025)
• Subordinated Debt Issued: $45.0 million (June 2025)
• Fixed Interest Rate on Notes: 7.75% (Until June 2030)
• Realized Pre-Tax Loss on Sale: $17.5 million (Q2 2025)

Expanding the Canal Bank division in Western New York

The expansion into the Buffalo region via the Canal Bank division is a significant strategic focus area. This division, introduced in 2024, is part of the broader strategy to grow in higher growth markets like Albany (via Capital Bank) and Buffalo. Management noted that loan pipelines remain strong across these key expansion markets. The growth in commercial loans in Q3 2025 was split, with approximately half coming from Capital Bank (Albany) and the remainder from the Buffalo and Southern Tier markets. Chemung Financial Corporation operates 30 offices across 14 counties in New York and Pennsylvania. Finance: draft 13-week cash view by Friday.

Chemung Financial Corporation (CHMG) - Canvas Business Model: Key Resources

You're mapping out the core assets that power Chemung Financial Corporation's operations right now. Honestly, for a regional player, their foundation is built on a couple of very solid, long-standing elements.

The primary engine is Chemung Canal Trust Company, the principal subsidiary. It's not just any bank; it holds the distinction of being the oldest locally-owned and managed community bank in New York State, having started way back in 1833. That history is a resource in itself, suggesting deep community ties and operational resilience.

To give you a snapshot of the scale of these resources as of mid-2025, here's the hard data you need to see:

That $45.0 million in subordinated notes, which closed in June 2025, is a key financial resource. It was specifically structured to qualify as Tier 2 capital at the holding company level, which helps support regulatory capital ratios for future growth initiatives. It carries a fixed interest rate of 7.75% until June 15, 2030.

Physical presence and market reach are also critical resources for a community bank. Chemung Financial Corporation maintains a significant footprint across two states:

• Network of 30 retail offices across New York and Pennsylvania.
• The physical network includes branches operating under the Chemung Canal Trust Company name and those branded as Capital Bank, a division of Chemung Canal Trust Company, serving markets like Western New York.

So, you have the deep institutional history of the Trust Company, substantial managed assets, a recent capital injection to bolster the balance sheet, and a physical network of 30 locations. That's the tangible stuff supporting their value proposition.

Chemung Financial Corporation (CHMG) - Canvas Business Model: Value Propositions

Full-service community banking with a long-standing, trusted local presence since 1833.

The durability of communities and credit standards is reflected in the non-performing loans to total loans ratio of 0.43 percent at year-end 2024, which improved to 0.35% as of the third quarter of 2025. The Corporation's President and CEO emphasized the importance of the community banking model in the first quarter of 2025.

Comprehensive wealth management, trust, and insurance services for affluent clients.

The Wealth Management Group (WMG) fee income was $11,573 thousand in 2024. This represented an increase of $1.1 million year-over-year in 2024. Recurring non-interest income saw a slight increase in the second quarter of 2025, supported by higher wealth management fees. Staffing increases in the third quarter of 2025 included adding additional wealth-management staff to the WMG division.

Strong commercial loan growth, particularly in the Canal Bank expansion markets.

Commercial loan growth reached an annualized rate of 10.5% in the first quarter of 2025. The Canal Bank division saw loan growth of 14.9% compared to the prior year-end in the first quarter of 2025. Total loan growth in the third quarter of 2025 was $69.9 million, a significant increase from $17.5 million in the third quarter of 2024. The Canal Bank division also posted deposit growth of 82.0% compared to the prior year-end in the first quarter of 2025.

High-touch, relationship-focused service model across all business lines.

Management noted attaining results in 2024 while staying true to the client-first, purpose-driven focus defining the community banking model. Staffing increases in the third quarter of 2025 included adding additional lending, branch staff to the Western New York Canal Bank division.

Unified digital experience via the GoBanking platform.

The platform was rebranded to GoBanking - The Digital Experience at Chemung, Capital, and Canal Banks. A significant upgrade to the GoBanking suite of online and mobile banking services for consumers and businesses was planned for completion in 2025.

Key Financial Metrics Supporting Value Propositions (Latest Available Data)

Chemung Financial Corporation (CHMG) - Canvas Business Model: Customer Relationships

You're looking at how Chemung Financial Corporation keeps its customers close, which is central to its identity as the oldest locally-owned and managed community bank in New York State, dating back to 1833. The core of their approach is a relationship-based model, which the President and CEO, Anders M. Tomson, highlighted in early 2025, emphasizing a client-first, purpose-driven focus that defines their community banking strategy. This isn't just about transactions; it's about high-touch engagement built over time, which they believe drives sustainable success.

For your high-net-worth clients, or those needing deeper planning, Chemung Financial Corporation relies on its Wealth Management Group. This group delivered a record year in 2024, contributing to non-interest income. Furthermore, the Corporation's subsidiary, CFS Group, Inc., which offers brokerage services, insurance, and annuities, had a meaningful impact, exceeding $1 million in revenue in 2022. To support this personalized service, Trust Assets Under Administration stood at $1,814,885 (in thousands, or $1.815 billion) as of December 31, 2024. The firm is also actively working to enhance the digital side of these relationships, planning a significant upgrade to its GoBanking suite throughout 2025 to offer a more unified digital experience.

Here are some key figures that frame the scale of their customer-facing operations as of the latest reporting:

The commitment to being a community partner is a non-negotiable part of the relationship strategy. Chemung Financial Corporation views itself as a dependable community partner, which means actively supporting local well-being beyond just banking services. You see this commitment reflected in their actions, even if the exact dollar amount of annual sponsorship isn't public in the latest filings. They focus on:

• Supporting local non-profit organizations through financial contributions and sponsorships.
• Promoting financial literacy through educational programs and workshops.
• Encouraging employee volunteerism in community projects and events.

Still, the traditional, in-person service remains vital, especially given their history. As of early 2025, Chemung Canal Trust Company operates through 30 offices across New York and Pennsylvania, serving markets under the Chemung Canal, Capital Bank, and Canal Bank brands. However, you should note that the Corporation is continually evaluating its physical distribution model for efficiency. This evaluation led to a $0.6 million gain on the sale of a previous branch property during the second quarter of 2025, suggesting a strategic shift in the physical footprint while maintaining the relationship focus elsewhere. They are definitely balancing the legacy of in-person service with modern efficiency needs.

Chemung Financial Corporation (CHMG) - Canvas Business Model: Channels

You're looking at how Chemung Financial Corporation gets its services-from deposits to wealth advice-into the hands of its customers. This is all about the physical footprint meeting the digital push, which is key for a community bank expanding its reach.

The core of the physical channel is the established network. As of early 2025, Chemung Financial Corporation operates 30 retail offices across 14 counties in New York and Pennsylvania through its principal subsidiary, Chemung Canal Trust Company. This network is segmented to target specific markets using distinct branding.

The physical distribution model is actively being optimized. You saw a $0.6 million gain on the sale of a previous branch property in the second quarter of 2025, which was part of an ongoing rationalization of the physical distribution network. However, growth in specific regions is also happening; for instance, the company opened a full-service branch and regional banking center in Williamsville, New York, under the Canal Bank brand in the fourth quarter of 2024. This expansion is supported by increased staffing, with salaries and wages rising in Q3 2025 partly due to adding additional lending, branch, and wealth-management staff in the Canal Bank division.

The digital channel, branded as GoBanking, is seeing significant investment. Management noted plans in early 2025 to complete a significant upgrade to the GoBanking suite of online and mobile banking services for both consumers and businesses, alongside a complete redesign of the Chemung Canal and Capital Bank websites. While specific platform adoption numbers for Chemung Financial Corporation aren't public, the general trend shows that 77% of banking interactions in the US now occur through digital channels. This digital focus supports the overall financial performance, as seen in the Q3 2025 Net Interest Margin (NIM) of 3.45 percent, which benefited from lower funding costs, with the cost of funds falling to 1.85% and the average yield on interest-earning assets rising to 5.15%.

Targeted commercial and wealth management outreach is another crucial channel. Dedicated teams drive loan growth across the different markets. Commercial real estate loan growth was notable, with the Canal Bank Division in Western New York seeing an increase of $24.9 million, and the overall loan portfolio seeing commercial mortgage loans increase by $43.3 million. Furthermore, the Wealth Management Group (WMG) fee income contributed to the $5.9 million in Non-Interest Income reported for Q3 2025, an increase of 4.1% year-over-year.

Chemung Financial Corporation uses its brand structure to target specific geographies through these channels:

• Chemung Canal Trust Company: Core market, Southern Tier.
• Canal Bank Division: Western New York, including Buffalo.
• Capital Bank Division: Albany area market.

Here's a quick look at some channel-related financial performance and scale as of late 2025:

The dedicated commercial lending officers and wealth management teams are the human interface for high-value services, complementing the self-service nature of the GoBanking platform. The growth in salaries and wages in Q3 2025 reflects investment in these relationship-focused personnel across the Canal Bank division. The company is defintely balancing its physical footprint rationalization with targeted growth in key markets like Albany (via Capital Bank) and Buffalo (via Canal Bank).

Chemung Financial Corporation (CHMG) - Canvas Business Model: Customer Segments

You're looking at the core groups Chemung Financial Corporation serves across its footprint. Honestly, the numbers tell you where the focus is right now.

Consumers and households in the Upstate New York and Northern Pennsylvania footprint

This segment is the bedrock, supported by the Bank's 30 retail offices operating across 14 counties in New York and Pennsylvania. The total loan portfolio size as of December 31, 2024, was $2.071 billion. The consumer-facing loan types, which include Residential Mortgages and Consumer loans, made up a significant portion of the total loan book at the end of 2024.

• Residential Mortgages represented 13.27% of total loans as of December 31, 2024.
• Consumer loans represented 13.51% of total loans as of December 31, 2024.

The overall Net Interest Margin (NIM) for Chemung Financial Corporation stood at 3.45% for the third quarter of 2025.

Small to mid-sized commercial businesses seeking local lending and treasury services

Chemung Financial Corporation emphasizes commercial loan momentum, particularly across its Chemung Canal, Capital Bank (Albany), and Canal Bank (Buffalo) markets. The lending focus here is detailed in the Commercial Loan Portfolio as of September 30, 2025.

The company originated $329.4 million in Commercial Loans during 2024. Non-performing loans to total loans improved to 0.35% as of Q3 2025.

Affluent individuals and families requiring wealth management and trust services

The Wealth Management Group (WMG) is a distinct reportable segment for Chemung Financial Corporation. The company has a stated focus on high-touch relationships with affluent borrowers.

• Trust Assets Under Administration (market value) totaled $1,814,885 thousand as of December 31, 2024.
• The quarterly dividend per share was raised to $0.34 during Q3 2025.

Local municipalities and non-profit organizations

While specific financial breakdowns for this segment aren't public, the overall structure supports this group through its community bank model. The total assets of Chemung Financial Corporation were reported at $2,696,634 thousand on a trailing twelve-month basis as of September 30, 2025. The company reported GAAP Earnings Per Share (EPS) of $1.62 for Q3 2025.

Chemung Financial Corporation (CHMG) - Canvas Business Model: Cost Structure

The Cost Structure for Chemung Financial Corporation centers on managing funding costs and personnel expenses, especially with recent expansion efforts.

Interest expense on deposits and borrowed funds remains a key area of focus for reduction, which management has actively addressed through balance sheet repositioning efforts. The total cost of funds for Chemung Financial Corporation in the third quarter of 2025 was reported at 1.85%, a notable decrease from 2.24% for the same period in the prior year, reflecting success in managing funding costs. Furthermore, all brokered deposits were fully repaid as of September 30, 2025.

Salaries and wages have seen upward pressure, directly linked to staffing in the Western New York Canal Bank division. This division required additional lending, branch, and wealth-management staff. Increases in salaries and wages, alongside pension and other employee benefits, were primary drivers for the overall rise in non-interest expense year-over-year.

Non-interest expense for Chemung Financial Corporation totaled $17.6 million in the third quarter of 2025. This figure represented an increase of 6.7 percent compared to the $16.5 million recorded in the third quarter of 2024. Overall operating expenses remained elevated year-over-year, showing a 6.9% increase.

The Provision for credit losses (PCL) for the third quarter of 2025 was $1.1 million. This compares to $0.6 million in the third quarter of 2024. This higher provision was largely attributed to stronger loan growth in the quarter, which totaled $69.9 million, and adjustments to the Current Expected Credit Losses (CECL) model inputs.

Regarding Data processing and technology costs for the digital platform, these were a component of the overall non-interest expense. For the full year ended December 31, 2024, data processing expenses increased by $0.3 million. In the first quarter of 2025, data processing expenses saw a decrease of $0.1 million compared to the prior quarter.

You can see a breakdown of key cost components for Q3 2025 versus the prior year below:

The expense profile also includes other elements that contribute to the overall cost base:

• Salaries and wages increased due to staffing in the Western New York Canal Bank division.
• Pension and other employee benefits contributed to the non-interest expense increase.
• FDIC insurance costs declined, partially offsetting other expense increases.
• Loan expense saw a decline in Q3 2025.

Chemung Financial Corporation (CHMG) - Canvas Business Model: Revenue Streams

You're looking at the core ways Chemung Financial Corporation generates its top line as of late 2025. The business model heavily leans on traditional banking activities, but non-interest income streams are definitely growing in importance, especially given the balance sheet repositioning efforts completed earlier in the year.

The primary engine remains Net Interest Income (NII), which reflects the spread between what Chemung Financial Corporation earns on its assets (like loans and securities) and what it pays out on its liabilities (like deposits). For the third quarter of 2025, NII totaled $22.7 million. This was a significant jump, showing an increase of 23.4 percent compared to the same period in the prior year. This quarter-over-quarter growth was reported as an uplift of $1.9 million, driven by gains in interest income on loans and interest-earning deposits, alongside a decline in interest expense on deposits.

Total revenue for the third quarter of 2025 was reported around $28.84 million. The remaining portion comes from non-interest income sources, which totaled $6.1 million for Q3 2025. This non-interest income is a mix of several fee-based services.

Here is a breakdown of the key revenue components based on the Q3 2025 figures:

You can see the concentration in NII, but the fee income is definitely contributing to the overall performance. For instance, the increase in interest-rate swap fees in Q3 2025 was specifically called out as a driver for the rise in Other non-interest income. This suggests that activity in their commercial lending, particularly in markets like Albany, Buffalo, and the Southern Tier, is translating directly into fee revenue as loans with interest-rate swap exposures are originated.

The components making up the non-interest income include:

• Wealth Management Group fees.
• Service charges on deposit accounts.
• Interest-rate swap fees.
• Debit card interchange fees.
• Other miscellaneous income sources.

The growth in NII, supported by a net interest margin that expanded 40 basis points quarter-over-quarter to 3.45 percent, is the most immediate financial impact you see from their balance sheet repositioning. The cost of funds fell to 1.85 percent in Q3 2025. This margin expansion helps offset any softness in fee categories, like the dip seen in wealth management fees during Q1 2025 due to market conditions.

Finance: draft Q4 2025 revenue projection based on Q3 run-rate by next Tuesday.