Retirement Benefit Plans

6 Months Ended

Jun. 30, 2025

RETIREMENT BENEFIT PLANS (Dollars in Thousands)

Arrow sponsors qualified and non-qualified defined benefit pension plans and other postretirement benefit plans for its employees. Arrow maintains a non-contributory pension plan, which covers substantially all employees. Arrow also maintains a supplemental non-qualified unfunded retirement plan to provide eligible employees of Arrow and its subsidiaries with benefits in excess of qualified plan limits imposed by federal tax law.

Arrow has multiple non-pension postretirement benefit plans. The health care, dental and life insurance plans are contributory, with participants’ contributions adjusted annually. Arrow’s policy is to fund the cost of postretirement benefits based on the current cost of the underlying policies. However, the health care plan provision allows for grandfathered participants to receive automatic increases of Company contributions each year based on the increase in inflation, limited to a maximum of 5%.

The following tables provide the components of net periodic benefit costs for the three and six-month periods ended June 30, 2025 and 2024:


	Employees'		Select Executive		Postretirement
	Pension		Retirement		Benefit
	Plan		Plan		Plans
Net Periodic Benefit Cost (Benefit)
For the Three Months Ended June 30, 2025:
Service Cost 1	$	402	$	21	$	5
Interest Cost 2	577		76		60
Expected Return on Plan Assets 2	(977)		—		—
Amortization of Prior Service Cost 2	48		10		25
Amortization of Net (Gain) 2	—		—		(159)
Net Periodic Cost (Benefit)	$	50	$	107	$	(69)

Plan Contributions During the Period	$	—	$	128	$	34

For the Three Months Ended June 30, 2024:
Service Cost 1	$	380	$	22	$	8
Interest Cost 2	595		2		79
Expected Return on Plan Assets 2	(923)		—		—
Amortization of Prior Service Cost 2	33		10		25
Amortization of Net (Gain) 2	—		(9)		(82)
Net Periodic Cost	$	85	$	25	$	30

Plan Contributions During the Period	$	—	$	128	$	54


Net Periodic Benefit Cost
For the Six Months Ended June 30, 2025:
Service Cost 1	$	802	$	47	$	16
Interest Cost 2	1,161		148		139
Expected Return on Plan Assets 2	(1,986)		—		—
Amortization of Prior Service Cost 2	95		20		51
Amortization of Net (Gain) 2	—		—		(255)
Net Periodic Cost (Benefit)	$	72	$	215	$	(49)

Plan Contributions During the Period	$	—	$	248	$	91

Estimated Future Contributions in the Current Fiscal Year	$	—	$	248	$	91

For the Six Months Ended June 30, 2024:
Service Cost 1	$	846	$	39	$	23
Interest Cost 2	1,120		160		160
Expected Return on Plan Assets 2	(1,855)		—		—
Amortization of Prior Service Cost 2	66		20		51
Amortization of Net Loss (Gain) 2	—		12		(169)
Net Periodic Cost	$	177	$	231	$	65

Plan Contributions During the Period	$	—	$	255	$	81

Footnotes:

1. Included in Salaries and Employee Benefits on the Consolidated Statements of Income

2. Included in Other Operating Expense on the Consolidated Statements of Income

A contribution to the qualified pension plan was not required during the six month period ended June 30, 2025 and currently, additional contributions in 2025 are not expected. Arrow makes contributions to its other post-retirement benefit plans in an amount equal to benefit payments for the year.

- Definition

The entire disclosure for retirement benefits.

+ References

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+ Details

ARROW FINANCIAL CORP 10-Q