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Arrow Financial Corporation Announces Strategic Acquisition of Adirondack Bancorp, Inc.

Arrow Financial Corporation (NASDAQGS: AROW) (“Arrow” or “AROW”), the parent company of Arrow Bank National Association, and Adirondack Bancorp, Inc. (“Adirondack”), the parent company of Adirondack Bank, jointly announced today that both companies’ boards of directors have unanimously approved an agreement and plan of merger (the “Agreement”) pursuant to which Adirondack will merge with and into Arrow.

This strategic acquisition extends Arrow’s eight-county footprint farther into the Adirondack region and into the Mohawk Valley to include Oneida, Herkimer and Franklin counties, while strengthening its commitment to Essex and Clinton counties. Based on the financial results as of December 31, 2025, the combined company would have pro-forma total assets of $5.4 billion, total deposits of $4.8 billion, and total gross loans of $4.1 billion.

David S. DeMarco, Arrow President and CEO, stated, “Arrow Bank and Adirondack Bank are two deeply rooted and culturally aligned community banks that share a long-standing commitment to building strong relationships, understanding the important role we play in local economic growth and community support. As our company celebrates its 175th anniversary, this strategic acquisition shows Arrow’s commitment to accelerating our growth and expanding our market presence. Bringing together these two institutions allows us to complement Adirondack’s current product offerings with our wealth management and insurance services and deliver meaningful value for our shareholders.”

Rocco F. Arcuri Sr., Adirondack President and CEO, will stay with Arrow as Regional President and will join the Arrow Board of Directors. “In Arrow, we have found a partner that shares our own culture and values and, like Adirondack, has a history of providing excellent customer service while supporting the communities it serves. Aligning our two community banks will create a more robust organization equipped for the future while benefitting our customers who will have the local support they expect with access to more products, services and locations. I’m excited to continue with Arrow to further align our mission and help ensure a smooth transition for all involved.”

Established in 1898 and converted to a state charter in December 2003, Adirondack operates 19 branch locations spanning Oneida, Herkimer, Franklin, Essex and Clinton counties, and a loan production office in Onondaga County. As of December 31, 2025, Adirondack had total assets of $942 million, total deposits of $848 million, and total loans of $624 million.2

Pursuant to the terms of the Agreement, Adirondack shareholders will receive a combination of stock and cash upon closing of the merger with Arrow. Each outstanding share of Adirondack common stock will be converted into 1.8610 shares of Arrow common stock plus $18.72 in cash. Based on the closing stock price of AROW common stock of $34.43 as of February 25, 2026, the per share implied consideration value is $82.79 and the aggregate implied transaction value is approximately $89.1 million.

Closing of the transaction is expected by the end of the second quarter of 2026 following receipt of approvals from regulatory authorities, the approval of Adirondack shareholders, and the satisfaction of other customary closing conditions. Once the acquisition is completed, Arrow will have 58 offices in upstate New York offering a full range of financial products and services.

The transaction is expected to be financially attractive with an estimated 2027 EPS accretion of approximately 18%, a strong internal rate of return of approximately 20% and a Tangible Book Value per Share earn-back period of 2.9 years. On a pro-forma basis, the business is expected to deliver compelling return metrics supported by a strong balance sheet, including:

• Allowance Coverage Ratio of over 1.00%
• Tangible Common Equity at closing of transaction of approximately 8%
• Total Risk-Based-Capital at closing of approximately 14%

Hovde Group, LLC is serving as financial advisor to Arrow and provided a fairness opinion, with Spierer, Woodward, Corbalis & Goldberg serving as legal advisor. Keefe, Bruyette & Woods, A Stifel Company is serving as financial advisor to Adirondack and provided a fairness opinion, with Luse Gorman serving as legal advisor.

Arrow Financial Corporation
(518) 415-4512
[email protected]
MEDIA CONTACTS: Rachael Murray Corporate Communications Professional Arrow Financial Corporation
(518) 415-4313 [email protected]
Anna Jolly Duval VP, Communications Manager Arrow Financial Corporation (518) 338-6270 [email protected]