Monday, July 28, 2008

Innovation and Nanatechnology Coming to Town!

John E. Kelly III, IBM Senior Vice President and Director of IBM Research, to speak on Innovation and Nanotechnology at EDC/Warren County Luncheon on Friday, September 5, 2008 at Great Escape Lodge in Queensbury

IBM's top global research executive will speak in Warren County on Friday, September 5, 2008, on the explosion of high-tech research and development in New York State. Dr. John E. Kelly III, IBM's senior vice president and director of research, last week announced an investment of $1.5 billion in the company's research operations at the College of Nanoscale Science and
Engineering at the University of Albany and two other upstate locations. The investments are expected to create at least 1,000 new jobs.

Kelly will be the guest speaker for the Warren County Economic Development Corporation's Emerging Business Trends luncheon. The event, to be held from 11:30 to 1:30 at the Great Escape Lodge in Queensbury, is open to members of the public, with advance paid reservations.

"We are thrilled to be able to bring IBM's senior-most research executive to Warren County," said EDC President Leonard Fosbrook. "This event, coming on the heels of IBM's announcement of its historic investment in Tech Valley and Upstate New York, creates a don't-miss opportunity for local business leaders and elected officials to hear first-hand about the high-tech revolution taking place less than 50 miles away and how it will benefit our region."

Dr. Kelly directs the worldwide operations of IBM Research, with more than 3,000 technical employees at eight laboratories in six countries around the world, and helps guide IBM's overall technical strategy. Dr. Kelly's top priority as head of IBM Research is to stimulate innovation in key areas and quickly bring those innovations into the marketplace to sustain and grow IBM's existing business, and to create the new businesses of IBM's future. Dr. Kelly also leads IBM's worldwide intellectual property business as well as the company's open source and open standards strategies and practices.

Major corporate sponsors for the event are Behan Communications Inc., Glens Falls National Bank & Trust Company, and Lemery Greisler LLC. Co-sponsors are The Post Star and the Adirondack Regional Chamber of Commerce. The cost for the luncheon is $25 per person, or $200 for a table of ten. More information, including a reservation form, is available at EDC's Web site,, or by calling EDC at 761-6007 ext. 300.

About EDC: EDC is a private, not-for-profit organization dedicated to improving the quality of life of residents in Warren County by helping businesses and industry grow, prosper, and create quality employment opportunities. The
organization, which is governed by an independent board of directors, is supported by more than 100 private-sector businesses and community organizations. EDC administers Warren County's Empire Zone program, and assists local companies seeking regulatory, financial, and technical assistance from local, state, and federal agencies.

Sunday, July 27, 2008

ACC to Offer Advanced Bookkeeping Applications

Adirondack Community College's Business Division will offer
Advanced Bookkeeping Applications (BUS 231) this fall, a new course
designed to assist those in the accounting industry to become Certified
Successful completion of this course, in addition to two years
of work experience and other requirements, may be used to prepare for
the National Certification Bookkeeper's (NCB) examination. Those who
pass the exam will receive the designation of Certified Bookkeeper (CB).

This course covers the six key subject areas in the field of
bookkeeping: adjusting entries; error correction; payroll; depreciation; merchandise inventory; and internal controls and fraud prevention. The subject matter covered within this course will build on the accounting foundations established in ACC's Financial Accounting and Management

Accounting classes and enable an individual to handle the technical
responsibilities of a chief bookkeeper for a small to middle sized

According to the Department of Labor, demand for bookkeepers is
expected to increase as more bookkeepers are called upon to do much of
the work of accountants. The department's Occupational Outlook Handbook
indicates those with several years of accounting or bookkeeping
certification will have the best prospects.

By becoming Certified Bookkeepers, students can advance their
careers and earn more money, enhance their professional image, and
increase their value to current and future employees or clients.

To qualify for enrollment, students must meet applicable
coursework prerequisites OR demonstrate applicable work experience. To
review prerequisite requirements, please call the ACC Registrar's Office
at 743-2280.

For more information about this course, please call Nick Buttino
at 743-2200, ext. 2649; Mary LaPann at 743-2200, ext. 2297; or Matthew
Muller at 743-2200, ext. 2201.

ACC Criminal Justice Student Receives NYSSA Scholarship

Danielle Charbonneau of Saratoga Springs, a graduate of
Adirondack Community College's criminal justice program, has been
awarded a $500 scholarship by the New York State Sheriffs' Association.

This scholarship is given by the Sheriffs' Association to an
outstanding criminal justice graduate at ACC. The presentation was made
recently by Warren County Sheriff Bud York.

"Danielle is a committed student and a role model for other
students who are interested in a career in the field of criminal
justice," said Peter Girard, professor of criminal justice at ACC. "She
developed an impressive resume while at ACC and we wish her good luck in
her future studies."

Danielle graduated from ACC in May with a degree in criminal
justice/police science. She will continue her education in the fall at
John Jay College in New York City, one of the premiere criminal justice
schools in the country.

"Many of our students carry a full course load, work part time
and have various outside commitments," Girard said. "This award
demonstrates that, in spite of these challenges, our students can meet
and exceed the high academic standards that ACC expects from its

While attending ACC, Danielle maintained a high grade point
average, was president of the Criminal Justice Club, participated in a
year-long mentoring program with the Washington County Youth Bureau,
worked part-time in the private security field in several different jobs
and was involved in many other criminal justice-related activities.

ACC's criminal justice degree program allows students the option
of focusing their studies in either police science or substance abuse
Approximately 200 students are enrolled in this program at ACC.

ACC is also offering graduating criminal justice students an
opportunity to earn a four-year criminal justice degree through SUNY
Plattsburgh at the ACC campus.

Brian M. Durant Appointed Dean for Student Affairs at ACC

Brian M. Durant of Saratoga Springs has been appointed dean
for student affairs at Adirondack Community College in Queensbury.

Durant had served as instructor of counseling at ACC since 2006
and had previously served as senior career specialist in the Office of
Academic Advisement and Career Planning at the Sage College of Albany
and as a counselor at Columbia-Greene Community College in Hudson.

He earned a master's degree in education in counseling from The
College of Saint Rose and a bachelor's degree in political science from
SUNY Plattsburgh.

Durant's new duties will include overseeing the college's
counseling, academic advising and career counseling efforts, as well as
student life and orientation programs and commencement ceremony

ACC Culinary Arts Student Awarded Scholarship

Vivian Brammer of Hadley, a freshman culinary arts student at Adirondack Community College, has been awarded a scholarship from the Cooperative Association of Food Enterprises (CAFÉ) Workers Compensation Trust and First Cardinal LLC, the first ACC student to receive such an honor.

Vivian returns to ACC in the fall to pursue an associate degree in culinary arts and baking. She currently works two jobs, at Prime at Saratoga National in Saratoga Springs and Saratoga Rose in Hadley.

"Vivian was selected for this award because of her strong professional ethics, her outstanding grade point average and her commitment to working in the food service industry while attending ACC," said Chef William Steele, director of ACC's Culinary Arts program.

Vivian plans to graduate ACC next spring and pursue a four-year degree at either Paul Smiths College or Johnson and Wales University in Boston.

The CAFÉ Trust, the largest self-funded restaurant trust fund in New York State, was formed for the specific purpose of providing statutory workers'
compensation and employers' liability coverage.

First Cardinal Corporation, based in Latham, administers the CAFÉ program and provides full marketing, risk management, claims administration, finance and underwriting services.

To qualify for the scholarship, an applicant must maintain a GPA of at least 2.75 and be employed in the food service industry that provides table service while taking classes at ACC. In addition, an applicant must volunteer for two community scholarship fund raisers for the American Culinary Federation's local chapter or for two events that would benefit First Cardinal.

"Lean Six Sigma"

ACC Center to Offer "Lean Six Sigma" Process Improvement Program for
Fall 2008

Adirondack Community College's Center for Personal and
Professional Development will offer "Lean Six Sigma," an intensive and
comprehensive process improvement program designed to benefit both
service sector and manufacturing companies, for the Fall 2008 semester.

An informational session covering the Lean Six Sigma program
will be held on Thursday, Sept. 4., at 7 p.m. on the ACC campus.

The program consists of three courses - White Belt
Certification, Green Belt Certification, and Black Belt Certification -
designed to introduce and engage participants in the elements of Lean
and Six Sigma processes.

Companies and organizations that integrate these principles into
their process improvement programs have realized substantial savings in
terms of design, production, inventory and customer service costs.

Lean is a process designed to bring about rapid, dramatic
improvements in the performance of an organization through a
simplification of the value stream.

Six Sigma is a business-driven, multi-faceted approach to process
improvement, cost reduction, and increased profits.

"This program was offered at Monroe Community College in Rochester last fall, and the 46 companies which participated in the program saved over $14 million from the projects lead by Lean Six Sigma candidates," said Louis H. Buck, ACC's dean for personal and professional development. "We are confident this program can have a similar impact on companies and organizations in the greater Glens Falls area."

The White Belt Certification program is a 20-hour introductory
course designed to cover the basics of the Lean Six Sigma philosophy
and concepts. Classes are taught with small group interaction and
hands-on exercises. This program is directed at anyone interested in
learning the basic concepts and principles of Lean Six Sigma.

The Green Belt Certification program will teach participants how
to implement the features of both Lean and Six Sigma to help secure the
long-term competitive advantage of their respective companies and
organizations. This program consists of two weeks of classroom training
and follow-up projects involving the real-world application of newly
acquired skills and knowledge.

The Black Belt Certification program consists of four weeks of
classroom training and is designed for those who have developed a high
proficiency in Lean and Six Sigma philosophies, concepts and tools;
understand how the methodologies augment each other; and who are leaders
and change agents for their respective companies and organizations.

The program is taught by Transformation Partners Co., LLC. Anwar
El-Homsi, president of Transformation Partners, will be on hand at the
September 4 information session to answer questions about the program.

For more information on the Lean Six Sigma program, or to RSVP
for the information session, please call the ACC Center at 743-2238.

Tuesday, July 15, 2008

Arrow Reports a Significant Increase in Earnings and Strong Asset Quality Ratios

Arrow Financial Corporation (NasdaqGS® – AROW) announced operating results for the three and six-month periods ended June 30, 2008. Net income for the second quarter ended June 30, 2008 was $5.4 million, representing diluted earnings per share of $.51, up $.12 or 30.8% from $.39 per share amount earned in the second quarter of 2007, when net income was $4.2 million. For the first six months of 2008, net income of $10.4 million increased 25% from the $8.3 million earned for 2007. Diluted earnings per share equaled $.98 for the first six months of 2008, up from $.77 per share earned during the comparative period in 2007.

Thomas L. Hoy, Chairman, President and CEO stated, “We are pleased to report a significant increase in earnings while asset and credit quality ratios remain strong. The favorable quarterly and six month earnings performances were primarily attributable to significant increases in net interest income as a result of a wider net interest margin and growth in average earning assets.

Average earning assets were $1.548 billion in the second quarter of 2008 versus $1.469 billion for the same quarter last year, an increase of 5.4%. Net interest income was favorably impacted by a rising net interest margin, which increased 60 basis points to 3.92% for the second quarter of 2008 versus the 2007 comparative period and increased 36 basis points as compared to the margin of 3.56% for the first quarter of 2008. Lower funding costs and a more positively sloped yield curve, a result of Federal Reserve Bank actions to lower the targeted federal funds rate 325 basis points since the beginning of September 2007, were principally responsible for the expansion in net interest margin. In essence, the volume of our interest-bearing liabilities that repriced to lower rates during the quarter significantly exceeded the volume of our earning assets that repriced to lower yields.

As we previously reported, Visa successfully completed an initial public offering (IPO) during the first quarter of 2008 which included a mandatory partial redemption of our holdings in Visa shares. This transaction resulted in a positive impact on our net income of $637 thousand after-tax, or $.06 diluted earnings per share, both in the first quarter of 2008 and for the six-month 2008 period.

Total assets at June 30, 2008 reached a record high of $1.631 billion, up $89.0 million, or 5.8%, over the June 30, 2007 balance of $1.542 billion. Loan balances outstanding reached a record level of $1.063 billion at June 30, 2008, representing an increase of $45.0 million, or 4.4%, from the balance at June 30, 2007. In addition, deposit balances at June 30, 2008 reached a record $1.249 billion, representing an increase of $43.9 million, or 3.6%, from the June 30, 2007 level of $1.205 billion.

In the first half of 2008, the deterioration of the residential real estate market nationally, and of so-called subprime mortgage loan portfolios, continued to have a negative impact on many financial institutions and indirectly on the national and world economies. We have not engaged in the origination of subprime mortgage loans or in subprime lending as a business line, nor do we hold mortgage-backed securities backed by subprime mortgages in our investment portfolio.
Asset quality remained high at quarter-end 2008, with nonperforming loans of $2.5 million, which represented .24% of period-end loans, down from .29% at the end of the first quarter. Gross loan charge-offs in the second quarter of 2008 were fully offset by recoveries, due to an unexpected recovery from our former Vermont operations. Expressed as an annualized percentage of average loans outstanding, net loans charged-off for the six months ended June 30, 2008 were a very low .04%. Arrow’s allowance for loan losses amounted to $12.7 million at June 30, 2008, which represented 1.20% of loans outstanding, an increase from 1.19% as of December 31, 2007.

Many of our operating ratios in recent periods have been well above those of our peer group, consisting of all U.S. bank holding companies having $1.0 to $3.0 billion in assets as identified in the Federal Reserve Bank’s ‘Bank Holding Company Performance Report.’ Most notably, our return on average equity (ROE) for the quarter ended March 31, 2008 was 16.07% as compared to 8.59% for our peer group. Our ROE for the second quarter of 2008 increased to 17.33%. Our loan quality ratios also compare very favorably to our peer group. At the end of the 2008 second quarter our ratio of nonperforming loans to period-end loans was .24% which compares to a ratio of 1.37% for our peer group as of March 31, 2008. The Company has maintained a higher total risk-based capital ratio than the average for our peer group. Arrow and our subsidiary banks continue to be “well-capitalized” under the standards established by the FDIC Improvement Act.

As of June 30, 2008, assets under trust administration and investment management were $897.7 million, a decrease of $63.6 million, or 6.6%, from June 30, 2007. This decrease was the result of a general decline in the equity markets, which also led to a 1.6% decrease in fee income from fiduciary activities for the second quarter of 2008 compared to the second quarter of 2007. Included in assets under trust administration and investment management are our proprietary mutual funds, the North Country Funds, advised exclusively by our subsidiary, North Country Investment Advisers, Inc., with a combined balance of $203 million at June 30, 2008.

Arrow was recently added to the Russell 2000® Index. Membership in the Russell 2000 is based on membership in the Broad-Market Russell 3000® Index, which also serves as the U.S. component to the Russell Global Index which was launched last year. Russell indexes are widely used by investment managers and institutional investors for index funds and as benchmarks for both passive and active investment strategies. Membership in the Russell Indexes, which are reconstituted annually in June, is determined based on the company’s market capitalization.

On July 1, 2008 we acquired the key operating assets, two employees and the trade name from U.S. Benefits, Inc., a provider of administrative and record keeping services for more complex retirement plans. This acquisition will allow us to offer enhanced and broadened services to retirement plan clients and will complement the fiduciary services currently offered by the Company through its trust administrative and investment management activities. The acquisition reflects the Company’s intent to develop new sources of service-based revenues and to provide an expanded menu of services to our customers.

Arrow Financial Corporation is a multi-bank holding company headquartered in Glens Falls, NY serving the financial needs of northeastern New York. Arrow is the parent of Glens Falls National Bank and Trust Company and Saratoga National Bank and Trust Company. Other subsidiaries include North Country Investment Advisers, Inc. and Capital Financial Group, Inc., an insurance agency specializing in the sale and servicing of group health plans.

The information contained in this News Release may contain statements that are not historical in nature but rather are based on management’s beliefs, assumptions, expectations, estimates and projections about the future. These statements may be “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, involving a degree of uncertainty and attendant risk. In the case of all forward-looking statements, actual outcomes and results may differ materially from what the statements predict or forecast, explicitly or by implication. The Company undertakes no obligation to revise or update these forward-looking statements to reflect the occurrence of unanticipated events. This News Release should be read in conjunction with the company’s Annual Report on Form 10-K for the year ended December 31, 2007.