• Amalgamated Financial Corp. Reports Fourth Quarter 2023 Financial Results: $170.8 Million Deposit Growth Excluding Brokered CDs; Net Interest Margin Rises to 3.44%

    ソース: Nasdaq GlobeNewswire / 25 1 2024 05:25:31   America/Chicago

    NEW YORK, Jan. 25, 2024 (GLOBE NEWSWIRE) -- Amalgamated Financial Corp. (the “Company” or “Amalgamated”) (Nasdaq: AMAL), the holding company for Amalgamated Bank (the “Bank”), today announced financial results for the fourth quarter ended December 31, 2023.

    Fourth Quarter 2023 Highlights (on a linked quarter basis)

    • Net income of $22.7 million, or $0.74 per diluted share, compared to $22.3 million, or $0.73 per diluted share.
    • Core net income1 of $22.1 million, or $0.72 per diluted share, compared to $23.3 million, or $0.76 per diluted share.
    • A tax adjustment of $3.3 million detracted $0.11 per diluted share from both GAAP and core net income.

    Deposits and Liquidity

    • Total deposits increased $21.1 million, or 0.3%, to $7.0 billion including a $149.7 million decline in Brokered CDs.
    • Excluding Brokered CDs, on-balance sheet deposits increased $170.8 million or 2.6% to $6.8 billion.
    • Political deposits increased $236.1 million, or 24.8%, to $1.2 billion.
    • Off-balance sheet deposits totaled $303.1 million, comprised primarily of transactional political deposits and transitional deposits scheduled for our Trust business.
    • Average cost of deposits excluding Brokered CDs, increased 14 basis points to 125 basis points for the quarter, where non-interest-bearing deposits comprised 43% of total deposits, nearly identical to the prior quarter.
    • Cash, off-balance sheet deposits, and borrowing capacity, totaled $3.0 billion (immediately available) plus unpledged securities (two-day availability) of $582 million for total liquidity within two-days of $3.6 billion (89% of total uninsured deposits).

    Assets and Margin

    • Net loans receivable increased $48.7 million, or 1.1%, to $4.3 billion.
    • Total PACE assessments grew $21.5 million, or 1.9% to $1.1 billion.
    • Net interest income grew $3.6 million, or 5.63%, to $67.3 million.
    • Net interest margin expanded 15 basis points to 3.44%.

    Investments and Capital

    • Tangible common equity1 ratio of 7.16%, representing a fifth consecutive quarter of improvement.
    • Traditional available-for-sale securities, which are 70% of the traditional securities portfolio, had unrealized losses of 6.7%, with an effective duration of 1.9 years.
    • Traditional held-to-maturity securities, which are 30% of the traditional securities portfolio, had unrecognized losses of 7.2%, with an effective duration of 4.1 years.
    • Regulatory capital remains above bank “well capitalized” standards.
    • Leverage ratio of 8.07%, increasing 18 basis points from the prior quarter and Common Equity Tier 1 ratio of 12.98% representing a conservative asset mix.

    Share Repurchase

    • Repurchased approximately 65,000 shares, or $1.1 million of common stock under the Company’s $40 million share repurchase program announced in the first quarter of 2022, with $19.8 million of remaining capacity.

    Full Year 2023 Highlights (from year end 2022)

    • Net income of $88.0 million, or $2.86 per diluted share, compared to $81.5 million, or $2.61 per diluted share, an increase of 8.0%.
    • Core net income1 was $90.5 million, or $2.94 per diluted share, as compared to $87.2 million, or $2.79 per diluted share, an increase of 3.8%.
    • Total deposits increased by $417.0 million, or 6.3% to $7.0 billion.
    • Net loans receivable increased $284.6 million, or 7.0%, to $4.3 billion.
    • Total PACE assessments increased $218.0 million, or 23.9%, to $1.1 billion.
    • Net interest income increased $21.5 million or 9.0%, to $261.3 million compared to $239.8 million.
    • Nonperforming assets were stable, increasing 6 basis points to $34.2 million or 0.43% of total assets.
    • Classified or criticized assets improved by 12 basis points to 2.48% of total loans.

    Priscilla Sims Brown, President and Chief Executive Officer, commented, “We are operating in an enviable position of managing deposit liquidity instead of searching for it. In today's highly constrained liquidity environment, we are punching well above our weight, giving us many options to deliver above peer returns.”

    __________________________________
    1 Reconciliations of non-GAAP financial measures to the most comparable GAAP measure are set forth on the last page of the financial information accompanying this press release and may also be found on our website, www.amalgamatedbank.com.

    Fourth Quarter Earnings

    Net income for the fourth quarter of 2023 was $22.7 million, or $0.74 per diluted share, compared to $22.3 million, or $0.73 per diluted share, for the third quarter of 2023. The $0.4 million increase during the quarter was primarily driven by a $3.6 million increase in net interest income and a $2.6 million increase in non-interest income, offset by a $1.8 million increase in provision for credit losses, and a $3.7 million increase in income tax expense primarily driven by a state and city tax examination that reduced the Bank’s net operating loss carryforwards, which resulted in additional tax liabilities and a write-down of deferred tax assets totaling $3.3 million.

    Core net income1 for the fourth quarter of 2023 was $22.1 million, or $0.72 per diluted share, compared to $23.3 million, or $0.76 per diluted share, for the third quarter of 2023. Excluded from core net income for the quarter, pre-tax was $2.3 million of losses on the sale of securities, and $3.3 million of tax credits from our solar tax equity investments. Excluded from the third quarter of 2023, pre-tax was $1.7 million of losses on the sale of securities, $0.6 million of pre-tax gains on subordinated debt repurchases, and $0.3 million in severance costs.

    Net interest income was $67.3 million for the fourth quarter of 2023, compared to $63.7 million for the third quarter of 2023. Loan interest income increased $2.0 million driven by a $56.2 million increase in average loan balances coupled with a 12 basis point increase in loan yields. Interest income on securities increased $1.8 million driven by a 27 basis point increase in securities yield offset by a decrease in the average balance of securities of $32.6 million. The increase in interest income was offset by higher interest expense on total interest-bearing deposits of $2.2 million driven by a 14 basis point increase in cost and an increase in the average balance of total interest-bearing deposits of $128.7 million. The changes in deposit costs were primarily related to increased rates on select non-time deposit products and also a 55 basis point increase in the cost of time deposits.

    Net interest margin was 3.44% for the fourth quarter of 2023, an increase of 15 basis points from 3.29% in the third quarter of 2023. The increase is largely due to increased yields and average balances of interest-earning assets driven mainly by strong PACE originations and commercial lending portfolio repricing. Prepayment penalties had no impact on our net interest margin in the fourth quarter of 2023, which is the same as in the prior quarter.

    Provision for credit losses totaled an expense of $3.8 million for the fourth quarter of 2023 compared to an expense of $2.0 million in the third quarter of 2023. The expense in the fourth quarter is primarily driven by $4.7 million charge-off on a construction loan, partially offset by improvements in macro-economic forecasts used in the CECL model.

    Core non-interest income1 was $8.5 million for the fourth quarter of 2023, compared to $7.8 million in the third quarter of 2023. The increase was primarily related to fees from our treasury investment services as well as fees earned from off-balance sheet reciprocal deposits.

    Core non-interest expense1 for the fourth quarter of 2023 was $37.7 million, an increase of $0.7 million from the third quarter of 2023. This was mainly driven by a $0.2 million increase in professional fees, and a $0.4 million increase in other expense primarily related to residential loan servicing expenses.

    Our provision for income tax expense was $12.5 million for the fourth quarter of 2023, compared to $8.8 million for the third quarter of 2023. The increase is primarily driven by a $3.3 million adjustment related to a state and city tax examination as previously mentioned. Excluding the tax adjustment, our effective tax rate for the fourth quarter of 2023 was 26.2%, compared to 28.4% for the third quarter of 2023.

    Balance Sheet Quarterly Summary

    Total assets were $8.0 billion at December 31, 2023, compared to $7.9 billion at September 30, 2023, in keeping with our strategy to keep our balance sheet flat. Notable changes within individual balance sheet line items include a $48.7 million increase in net loans receivable, and a $50.0 million increase in resell agreements. Additionally, deposits excluding Brokered CDs increased by $170.8 million while Brokered CDs decreased $149.7 million.

    Total net loans receivable, at December 31, 2023 were $4.3 billion, an increase of $48.7 million, or 1.1% for the quarter. The increase in loans is primarily driven by a $53.2 million increase in multifamily loans, a $29.3 million increase in the commercial real estate portfolio, and a $16.1 million increase in residential loans, offset by a $39.4 million decrease in commercial and industrial loans, mainly related to paydowns on revolving lines. During the quarter, criticized or classified loans increased $22.0 million largely related to the downgrade of an $18.7 million commercial and industrial loan to substandard and accruing.

    Total deposits at December 31, 2023 were $7.0 billion, an increase of $21.1 million, or 0.3%, during the quarter. Total deposits excluding Brokered CDs increased by $170.8 million to $6.8 billion, or a 2.6% increase. Deposits held by politically active customers, such as campaigns, PACs, advocacy-based organizations, and state and national party committees were $1.2 billion as of December 31, 2023, an increase of $236.1 million during this quarter, of which a substantial portion were moved off-balance sheet. Non-interest-bearing deposits represented 41% of average total deposits and 42% of ending total deposits for the quarter, contributing to an average cost of total deposits of 143 basis points. Super-core deposits1 totaled approximately $3.6 billion, had a weighted average life of 16 years, and comprised 53% of total deposits, excluding Brokered CDs. Total uninsured deposits were $4.0 billion, comprising 58% of total deposits. Excluding uninsured super-core deposits of approximately $2.6 billion, remaining uninsured deposits were approximately 21%-24% of total deposits with immediate liquidity coverage of 202%.

    Nonperforming assets totaled $34.2 million, or 0.43% of period-end total assets at December 31, 2023, a decrease of $2.3 million, compared with $36.5 million, or 0.46% on a linked quarter basis. The decrease in nonperforming assets was primarily driven by a charge-off of a $4.7 million construction loan and sale of a $1.2 million multifamily loan held for sale, offset by a $4.2 million increase in residential real estate nonaccrual loans.

    During the quarter, the allowance for credit losses on loans decreased $2.1 million to $65.7 million. The ratio of allowance to total loans was 1.49%, a decrease of 6 basis points from 1.55% in the third quarter of 2023.

    Capital Quarterly Summary

    As of December 31, 2023, our Common Equity Tier 1 Capital ratio was 12.98%, Total Risk-Based Capital ratio was 15.64%, and Tier-1 Leverage Capital ratio was 8.07%, compared to 12.63%, 15.28% and 7.89%, respectively, as of September 30, 2023. Stockholders’ equity at December 31, 2023 was $585.4 million, an increase of $39.1 million during the quarter. The increase in stockholders’ equity was primarily driven by $22.7 million of net income for the quarter offset by $3.1 million in dividends paid at $0.10 per outstanding share, $1.1 million of common stock repurchases, and a $19.3 million improvement in accumulated other comprehensive loss due to the tax effected mark-to-market on our available for sale securities portfolio.

    Tangible book value per share was $18.74 as of December 31, 2023 compared to $17.43 as of September 30, 2023. Tangible common equity improved to 7.16% of tangible assets, compared to 6.72% as of September 30, 2023.

    Conference Call

    As previously announced, Amalgamated Financial Corp. will host a conference call to discuss its fourth quarter results today, January 25, 2024 at 11:00am (Eastern Time). The conference call can be accessed by dialing 1-877-407-9716 (domestic) or 1-201-493-6779 (international) and asking for the Amalgamated Financial Corp. Fourth Quarter 2023 Earnings Call. A telephonic replay will be available approximately two hours after the call and can be accessed by dialing 1-844-512-2921, or for international callers 1-412-317-6671 and providing the access code 13743057. The telephonic replay will be available until February 1, 2024.

    Interested investors and other parties may also listen to a simultaneous webcast of the conference call by logging onto the investor relations section of our website at http://ir.amalgamatedbank.com/. The online replay will remain available for a limited time beginning immediately following the call.

    The presentation materials for the call can be accessed on the investor relations section of our website at https://ir.amalgamatedbank.com/.

    About Amalgamated Financial Corp.

    Amalgamated Financial Corp. is a Delaware public benefit corporation and a bank holding company engaged in commercial banking and financial services through its wholly-owned subsidiary, Amalgamated Bank. Amalgamated Bank is a New York-based full-service commercial bank and a chartered trust company with a combined network of five branches across New York City, Washington D.C., and San Francisco, and a commercial office in Boston. Amalgamated Bank was formed in 1923 as Amalgamated Bank of New York by the Amalgamated Clothing Workers of America, one of the country’s oldest labor unions. Amalgamated Bank provides commercial banking and trust services nationally and offers a full range of products and services to both commercial and retail customers. Amalgamated Bank is a proud member of the Global Alliance for Banking on Values and is a certified B Corporation®. As of December 31, 2023, our total assets were $8.0 billion, total net loans were $4.3 billion, and total deposits were $7.0 billion. Additionally, as of December 31, 2023, our trust business held $41.7 billion in assets under custody and $14.8 billion in assets under management.

    Non-GAAP Financial Measures

    This release (and the accompanying financial information and tables) refer to certain non-GAAP financial measures including, without limitation, “Core operating revenue,” “Core non-interest expense,” “Core non-interest income,” “Core net income,” “Tangible common equity,” “Average tangible common equity,” “Core return on average assets,” “Core return on average tangible common equity,” and “Core efficiency ratio.”

    Our management utilizes this information to compare our operating performance for December 31, 2023 versus certain periods in 2023 and 2022 and to prepare internal projections. We believe these non-GAAP financial measures facilitate making period-to-period comparisons and are meaningful indications of our operating performance. In addition, because intangible assets such as goodwill and other discrete items unrelated to our core business, which are excluded, vary extensively from company to company, we believe that the presentation of this information allows investors to more easily compare our results to those of other companies.

    The presentation of non-GAAP financial information, however, is not intended to be considered in isolation or as a substitute for GAAP financial measures. We strongly encourage readers to review the GAAP financial measures included in this release and not to place undue reliance upon any single financial measure. In addition, because non-GAAP financial measures are not standardized, it may not be possible to compare the non-GAAP financial measures presented in this release with other companies’ non-GAAP financial measures having the same or similar names. Reconciliations of non-GAAP financial disclosures to comparable GAAP measures found in this release are set forth in the final pages of this release and also may be viewed on our website, amalgamatedbank.com.

    Terminology

    Certain terms used in this release are defined as follows:

    “Core efficiency ratio” is defined as “Core non-interest expense” divided by “Core operating revenue.” We believe the most directly comparable performance ratio derived from GAAP financial measures is an efficiency ratio calculated by dividing total non-interest expense by the sum of net interest income and total non-interest income.

    “Core net income” is defined as net income after tax excluding gains and losses on sales of securities, gains on the sale of owned property, costs related to branch closures, restructuring/severance costs, acquisition costs, tax credits and accelerated depreciation on solar equity investments, and taxes on notable pre-tax items. We believe the most directly comparable GAAP financial measure is net income.

    “Core non-interest expense” is defined as total non-interest expense excluding costs related to branch closures, restructuring/severance, and acquisitions. We believe the most directly comparable GAAP financial measure is total non-interest expense.

    “Core non-interest income” is defined as total non-interest income excluding gains and losses on sales of securities, gains on the sale of owned property, and tax credits and accelerated depreciation on solar equity investments. We believe the most directly comparable GAAP financial measure is non-interest income.

    “Core operating revenue” is defined as total net interest income plus “core non-interest income”. We believe the most directly comparable GAAP financial measure is the total of net interest income and non-interest income.

    “Core return on average assets” is defined as “Core net income” divided by average total assets. We believe the most directly comparable performance ratio derived from GAAP financial measures is return on average assets calculated by dividing net income by average total assets.

    “Core return on average tangible common equity” is defined as “Core net income” divided by average “tangible common equity.” We believe the most directly comparable performance ratio derived from GAAP financial measures is return on average equity calculated by dividing net income by average total stockholders’ equity.

    “Super-core deposits” are defined as total deposits from commercial and consumer customers, with a relationship length of greater than 5 years. We believe the most directly comparable GAAP financial measure is total deposits.

    “Tangible assets” are defined as total assets excluding, as applicable, goodwill and core deposit intangibles. We believe the most directly comparable GAAP financial measure is total assets.

    “Tangible common equity”, and “Tangible book value” are defined as stockholders’ equity excluding, as applicable, minority interests, preferred stock, goodwill and core deposit intangibles. We believe that the most directly comparable GAAP financial measure is total stockholders’ equity.

    "Traditional securities portfolio" is defined as total investment securities excluding PACE assessments. We believe the most directly comparable GAAP financial measure is total investment securities.

    Forward-Looking Statements

    Statements included in this release that are not historical in nature are intended to be, and are hereby identified as, forward-looking statements within the meaning of the Private Securities Litigation Reform Act, Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements generally can be identified through the use of forward-looking terminology such as “may,” “will,” “anticipate,” “aspire,” “should,” “would,” “believe,” “contemplate,” “expect,” “estimate,” “continue,” “in the future,” “may” and “intend,” as well as other similar words and expressions of the future. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors, any or all of which could cause actual results to differ materially from the results expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to: (i) uncertain conditions in the banking industry and in national, regional and local economies in our core markets, which may have an adverse impact on our business, operations and financial performance; (ii) deterioration in the financial condition of borrowers resulting in significant increases in loan losses and provisions for those losses; (iii) deposit outflows and subsequent declines in liquidity caused by factors that could include lack of confidence in the banking system, a deterioration in market conditions or the financial condition of depositors; (iv) changes in our deposits, including an increase in uninsured deposits; (v) unfavorable conditions in the capital markets, which may cause declines in our stock price and the value of our investments; (vi) continued fluctuation of the interest rate environment, including changes in net interest margin or changes that affect the yield curve on investments; (vii) potential deterioration in real estate collateral values; (viii) changes in legislation, regulation, public policies, or administrative practices impacting the banking industry, including increased regulation in the aftermath of recent bank failures; (ix) the outcome of legal or regulatory proceedings that may be instituted against us; (x) our inability to maintain the historical growth rate of the loan portfolio; (xi) changes in loan underwriting, credit review or loss reserve policies associated with economic conditions, examination conclusions, or regulatory developments; (xii) the impact of competition with other financial institutions, including pricing pressures and the resulting impact on our results, including as a result of compression to net interest margin; (xiii) any matter that would cause us to conclude that there was impairment of any asset, including intangible assets; (xiv) the risk that the preliminary financial information reported herein and our current preliminary analysis will be different when our review is finalized; (xv) increased competition for experienced members of the workforce including executives in the banking industry; (xvi) a failure in or breach of our operational or security systems or infrastructure, or those of third party vendors or other service providers, including as a result of unauthorized access, computer viruses, phishing schemes, spam attacks, human error, natural disasters, power loss and other security breaches; (xvii) increased regulatory scrutiny and exposure from the use of “big data” techniques, machine learning, and artificial intelligence; (xviii) a downgrade in our credit rating; (xix) increased political opposition to Environmental, Social and Governance (“ESG”) practices and Diversity, Equity and Inclusion (“DEI”) practices; (xx) physical and transitional risks related to climate change as they impact our business and the businesses that we finance; and (xxi) future repurchase of our shares through our common stock repurchase program. Additional factors which could affect the forward-looking statements can be found in our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K filed with the SEC and available on the SEC's website at https://www.sec.gov/. We disclaim any obligation to update or revise any forward-looking statements contained in this release, which speak only as of the date hereof, whether as a result of new information, future events or otherwise, except as required by law.

    Investor Contact:
    Jamie Lillis
    Solebury Strategic Communications
    shareholderrelations@amalgamatedbank.com 
    800-895-4172

    Consolidated Statements of Income

     Three Months Ended Year Ended
     December 31, September 30, December 31, December 31,
    ($ in thousands)2023 2023 2022 2023 2022
    INTEREST AND DIVIDEND INCOME(unaudited) (unaudited) (unaudited) (unaudited)  
    Loans$51,551  $49,578  $42,492  $191,295  $145,649 
    Securities 42,014   39,971   35,567   161,003   110,654 
    Interest-bearing deposits in banks 2,419   1,687   485   5,779   2,186 
    Total interest and dividend income 95,984   91,236   78,544   358,077   258,489 
    INTEREST EXPENSE         
    Deposits 25,315   23,158   5,682   81,124   11,056 
    Borrowed funds 3,350   4,350   5,516   15,642   7,593 
    Total interest expense 28,665   27,508   11,198   96,766   18,649 
    NET INTEREST INCOME 67,319   63,728   67,346   261,311   239,840 
    Provision for credit losses(1) 3,756   2,014   4,434   14,670   15,002 
    Net interest income after provision for credit losses 63,563   61,714   62,912   246,641   224,838 
    NON-INTEREST INCOME         
    Trust Department fees 3,562   3,678   3,607   15,175   14,449 
    Service charges on deposit accounts 3,102   2,731   2,991   10,999   10,999 
    Bank-owned life insurance income 828   727   986   2,882   3,868 
    Losses on sale of securities (2,340)  (1,699)  (1,373)  (7,392)  (3,637)
    Gains (losses) on sale of loans, net 2   26   (578)  32   (610)
    Loss on other real estate owned, net       (168)     (168)
    Equity method investments income (loss) 3,671   550   (1,416)  4,932   (2,773)
    Other income 581   767   177   2,708   1,769 
    Total non-interest income 9,406   6,780   4,226   29,336   23,897 
    NON-INTEREST EXPENSE         
    Compensation and employee benefits 21,249   21,345   19,470   85,774   74,712 
    Occupancy and depreciation 3,421   3,349   3,345   13,605   13,723 
    Professional fees 2,426   2,222   1,684   9,637   10,417 
    Data processing 4,568   4,545   4,072   17,744   17,732 
    Office maintenance and depreciation 700   685   696   2,830   3,012 
    Amortization of intangible assets 222   222   262   888   1,047 
    Advertising and promotion 750   816   1,331   4,181   3,741 
    Federal deposit insurance premiums 1,000   1,200   788   4,018   3,228 
    Other expense 3,416   2,955   3,922   12,570   12,959 
    Total non-interest expense 37,752   37,339   35,570   151,247   140,571 
    Income before income taxes 35,217   31,155   31,568   124,730   108,164 
    Income tax expense 12,522   8,847   6,813   36,752   26,687 
    Net income$22,695  $22,308  $24,755  $87,978  $81,477 
    Earnings per common share - basic$0.75  $0.73  $0.81  $2.88  $2.64 
    Earnings per common share - diluted$0.74  $0.73  $0.80  $2.86  $2.61 

    (1) In accordance with the adoption of the Current Expected Credit Losses (“CECL”) standard on January 1, 2023, the provision for credit losses as of December 31, 2023 and September 30, 2023 is calculated under the current expected credit losses model. For December 31, 2022, the provision presented is the provision for loan losses calculated using the incurred loss model.

    Consolidated Statements of Financial Condition

    ($ in thousands)December 31,
    2023
     September 30,
    2023
     December 31,
    2022
    Assets(unaudited) (unaudited)  
    Cash and due from banks$2,856  $5,494  $5,110 
    Interest-bearing deposits in banks 87,714   134,725   58,430 
    Total cash and cash equivalents 90,570   140,219   63,540 
    Securities:     
    Available for sale, at fair value 1,483,042   1,491,450   1,812,476 
    Held-to-maturity, at amortized cost:     
    Traditional securities, net of allowance for credit losses(1)of $54 and $55 at December 31, 2023 and September 30, 2023, respectively 620,232   612,026   629,424 
    PACE assessments, net of allowance for credit losses(1)of $667 and $670 at December 31, 2023 and September 30, 2023, respectively 1,076,602   1,069,834   911,877 
      1,696,834   1,681,860   1,541,301 
          
    Loans held for sale 1,817   2,189   7,943 
    Loans receivable, net of deferred loan origination costs 4,411,319   4,364,745   4,106,002 
    Allowance for credit losses(1) (65,691)  (67,815)  (45,031)
    Loans receivable, net 4,345,628   4,296,930   4,060,971 
          
    Resell agreements 50,000      25,754 
    Federal Home Loan Bank of New York ("FHLBNY") stock, at cost 4,389   4,389   29,607 
    Accrued interest and dividends receivable 55,484   47,745   41,441 
    Premises and equipment, net 7,807   8,428   9,856 
    Bank-owned life insurance 105,528   105,708   105,624 
    Right-of-use lease asset 21,074   22,907   28,236 
    Deferred tax asset, net 56,603   63,322   62,507 
    Goodwill 12,936   12,936   12,936 
    Intangible assets, net 2,217   2,439   3,105 
    Equity method investments 13,024   11,813   8,305 
    Other assets 25,371   17,397   29,522 
    Total assets$7,972,324  $7,909,732  $7,843,124 
    Liabilities     
    Deposits$7,011,988  $6,990,854  $6,595,037 
    Subordinated debt, net 70,546   70,427   77,708 
    FHLBNY advances 4,381   4,381   580,000 
    Other borrowings 230,000   230,000    
    Operating leases 30,646   33,242   40,779 
    Other liabilities 39,399   34,537   40,645 
    Total liabilities 7,386,960   7,363,441   7,334,169 
    Stockholders’ equity     
    Common stock, par value $.01 per share 307   307   307 
    Additional paid-in capital 288,232   287,579   286,947 
    Retained earnings 388,033   368,420   330,275 
    Accumulated other comprehensive loss, net of income taxes (86,004)  (105,294)  (108,707)
    Treasury stock, at cost (5,337)  (4,854)   
    Total Amalgamated Financial Corp. stockholders' equity 585,231   546,158   508,822 
    Noncontrolling interests 133   133   133 
    Total stockholders' equity 585,364   546,291   508,955 
    Total liabilities and stockholders’ equity$7,972,324  $7,909,732  $7,843,124 

    (1) In accordance with the adoption of the CECL standard on January 1, 2023, the allowance for credit losses on both loans and securities as of December 31, 2023 and September 30, 2023 is calculated under the current expected credit losses model. For December 31, 2022, no allowance was calculated on securities, and the allowance on loans presented is the allowance for loan losses calculated using the incurred loss model.

    Select Financial Data

     As of and for the As of and for the
     Three Months Ended Year Ended
     December 31, September 30, December 31, December 31,
    (Shares in thousands)2023
     2023
     2022
     2023
     2022
    Selected Financial Ratios and Other Data:         
    Earnings per share         
    Basic$0.75  $0.73  $0.81  $2.88  $2.64 
    Diluted 0.74   0.73   0.80   2.86   2.61 
    Core net income (non-GAAP)         
    Basic$0.73  $0.76  $0.89  $2.96  $2.83 
    Diluted 0.72   0.76   0.87   2.94   2.79 
    Book value per common share (excluding minority interest)$19.23  $17.93  $16.57  $19.23  $16.57 
    Tangible book value per share (non-GAAP)$18.74  $17.43  $16.05  $18.74  $16.05 
    Common shares outstanding, par value $.01 per share(1) 30,428   30,459   30,700   30,428   30,700 
    Weighted average common shares outstanding, basic 30,418   30,481   30,679   30,555   30,818 
    Weighted average common shares outstanding, diluted 30,616   30,590   31,055   30,785   31,193 
              
    (1) 70,000,000 shares authorized; 30,736,141, 30,736,141, and 30,700,198 shares issued for the periods ended December 31, 2023, September 30, 2023, and December 31, 2022 respectively, and 30,428,359, 30,458,781, and 30,700,198 shares outstanding for the periods ended December 31, 2023, September 30, 2023, and December 31, 2022 respectively
     

    Select Financial Data

     As of and for the As of and for the
     Three Months Ended Year Ended
     December 31, September 30, December 31, December 31,
     2023 2023 2022 2023 2022
    Selected Performance Metrics:         
    Return on average assets1.13% 1.12% 1.26% 1.12% 1.05%
    Core return on average assets (non-GAAP)1.10% 1.17% 1.38% 1.15% 1.13%
    Return on average equity16.23% 16.43% 19.89% 16.57% 15.65%
    Core return on average tangible common equity (non-GAAP)16.22% 17.67% 22.58% 17.55% 17.30%
    Average equity to average assets6.95% 6.82% 6.32% 6.74% 6.74%
    Tangible common equity to tangible assets (non-GAAP)7.16% 6.72% 6.30% 7.16% 6.30%
    Loan yield4.68% 4.56% 4.24% 4.49% 4.03%
    Securities yield5.21% 4.94% 4.08% 4.93% 3.14%
    Deposit cost1.43% 1.33% 0.34% 1.17% 0.16%
    Net interest margin3.44% 3.29% 3.56% 3.41% 3.22%
    Efficiency ratio(1)49.20% 52.96% 49.70% 52.04% 53.30%
    Core efficiency ratio (non-GAAP)49.73% 51.71% 47.65% 51.33% 51.68%
              
    Asset Quality Ratios:         
    Nonaccrual loans to total loans0.75% 0.79% 0.53% 0.75% 0.53%
    Nonperforming assets to total assets0.43% 0.46% 0.37% 0.43% 0.37%
    Allowance for credit losses on loans to nonaccrual loans(2)197.97% 197.58% 207.53% 197.97% 207.53%
    Allowance for credit losses on loans to total loans(2)1.49% 1.55% 1.10% 1.49% 1.10%
    Annualized net charge-offs (recoveries) to average loans0.51% 0.27% 0.15% 0.33% 0.16%
              
    Capital Ratios:         
    Tier 1 leverage capital ratio8.07% 7.89% 7.52% 8.07% 7.52%
    Tier 1 risk-based capital ratio12.98% 12.63% 12.31% 12.98% 12.31%
    Total risk-based capital ratio15.64% 15.28% 14.87% 15.64% 14.87%
    Common equity tier 1 capital ratio12.98% 12.63% 12.31% 12.98% 12.31%
              
    (1) Efficiency ratio is calculated by dividing total non-interest expense by the sum of net interest income and total non-interest income
    (2) In accordance with the adoption of the CECL standard on January 1, 2023, the allowance for credit losses on loans as of December 31, 2023 and September 30, 2023 are calculated under the current expected credit losses model. For December 31, 2022, the allowance on loans presented is the allowance for loan losses calculated using the incurred loss model.
     

    Loan and PACE Assessments Portfolio Composition

    (In thousands)At December 31, 2023 At September 30, 2023 At December 31, 2022
     Amount % of total
    loans
     Amount % of total
    loans
     Amount % of total
    loans
    Commercial portfolio:           
    Commercial and industrial$1,010,998  22.9% $1,050,355  24.1% $925,641  22.5%
    Multifamily 1,148,120  26.1%  1,094,955  25.1%  967,521  23.6%
    Commercial real estate 353,432  8.0%  324,139  7.4%  335,133  8.2%
    Construction and land development 23,626  0.5%  28,326  0.6%  37,696  0.9%
    Total commercial portfolio 2,536,176  57.5%  2,497,775  57.2%  2,265,991  55.2%
                
    Retail portfolio:           
    Residential real estate lending 1,425,596  32.3%  1,409,530  32.3%  1,371,779  33.5%
    Consumer solar(1) 408,260  9.3%  415,324  9.5%  416,849  10.2%
    Consumer and other(1) 41,287  0.9%  42,116  1.0%  47,150  1.1%
    Total retail 1,875,143  42.5%  1,866,970  42.8%  1,835,778  44.8%
    Total loans held for investment 4,411,319  100.0%  4,364,745  100.0%  4,101,769  100.0%
                
    Net deferred loan origination costs(2)           4,233   
    Allowance for credit losses(3) (65,691)    (67,815)    (45,031)  
    Loans receivable, net$4,345,628    $4,296,930    $4,060,971   
                
    PACE assessments:           
    Held-to-maturity, at amortized cost 1,077,269  95.3%  1,070,504  96.5%  911,877  100.0%
    Available for sale, at fair value 53,303  4.7%  38,526  3.5%    %
    Total PACE assessments 1,130,572  100.0%  1,109,030  100.0%  911,877  100.0%
                
    Allowance for credit losses(3) (667)    (670)       
    Total PACE assessments, net$1,129,905    $1,108,360    $911,877   

    (1) The Company adopted the CECL standard on January 1, 2023. As a result, the classification of loan segments was updated, and all loan balances for presented periods have been reclassified.
    (2) With the adoption of the CECL standard, loans balances as of December 31, 2023 and September 30, 2023 are presented at amortized cost, net of deferred loan origination costs.
    (3) With the adoption of the CECL standard, the allowance for credit losses on both loans and securities as of December 31, 2023 and September 30, 2023 are calculated under the current expected credit losses model. For December 31, 2022, no allowance was calculated on securities, and the allowance on loans presented is the allowance for loan losses calculated using the incurred loss model.

    Net Interest Income Analysis

     Three Months Ended
     December 31, 2023 September 30, 2023 December 31, 2022
    (In thousands)Average
    Balance
    Income / ExpenseYield /
    Rate
     Average
    Balance
    Income / ExpenseYield /
    Rate
     Average
    Balance
    Income / ExpenseYield /
    Rate
                      
    Interest-earning assets:                 
    Interest-bearing deposits in banks$190,994 $2,419 5.02% $170,830 $1,687 3.92% $85,886 $485 2.24%
    Securities(1) 3,175,784  41,741 5.21%  3,208,334  39,971 4.94%  3,400,994  34,939 4.08%
    Resell agreements 16,848  273 6.43%     0.00%  46,909  628 5.31%
    Loans receivable, net(2)(3) 4,370,946  51,551 4.68%  4,314,767  49,578 4.56%  3,977,554  42,492 4.24%
    Total interest-earning assets 7,754,572  95,984 4.91%  7,693,931  91,236 4.70%  7,511,343  78,544 4.15%
    Non-interest-earning assets:                 
    Cash and due from banks 5,357      6,129      5,267    
    Other assets 220,580      204,506      289,979    
    Total assets$7,980,509     $7,904,566     $7,806,589    
                      
    Interest-bearing liabilities:                 
    Savings, NOW and money market deposits$3,629,658 $19,808 2.17% $3,446,027 $17,157 1.98% $2,967,150 $5,161 0.69%
    Time deposits 183,225  1,423 3.08%  176,171  1,122 2.53%  167,138  174 0.41%
    Brokered CDs 309,378  4,084 5.24%  371,329  4,879 5.21%  37,047  347 3.72%
    Total interest-bearing deposits 4,122,261  25,315 2.44%  3,993,527  23,158 2.30%  3,171,335  5,682 0.71%
    Other borrowings 304,869  3,350 4.36%  376,585  4,350 4.58%  545,303  5,514 4.01%
    Total interest-bearing liabilities 4,427,130  28,665 2.57%  4,370,112  27,508 2.50%  3,716,638  11,196 1.20%
    Non-interest-bearing liabilities:                 
    Demand and transaction deposits 2,921,961      2,920,737      3,522,352    
    Other liabilities 76,588      74,964      73,838    
    Total liabilities 7,425,679      7,365,813      7,312,828    
    Stockholders' equity 554,830      538,753      493,761    
    Total liabilities and stockholders' equity$7,980,509     $7,904,566     $7,806,589    
                      
    Net interest income / interest rate spread  $67,319 2.34%   $63,728 2.20%   $67,348 2.95%
    Net interest-earning assets / net interest margin$3,327,442   3.44% $3,323,819   3.29% $3,794,705   3.56%
                      
    Total deposits excluding Brokered CDs / total cost of deposits excluding Brokered CDs$6,734,844   1.25% $6,542,935   1.11% $6,656,640   0.32%
    Total deposits / total cost of deposits$7,044,222   1.43% $6,914,264   1.33% $6,693,687   0.34%
    Total funding / total cost of funds$7,349,091   1.55% $7,290,849   1.50% $7,238,990   0.61%

    (1) Includes Federal Home Loan Bank (FHLB) stock in the average balance, and dividend income on FHLB stock in interest income
    (2) Amounts are net of deferred origination costs. With the adoption of the CECL standard on January 1, 2023, the average balance of the allowance for credit losses on loans was reclassified for all presented periods to other assets to allow for comparability.
    (3) Includes prepayment penalty interest income in 4Q2023, 3Q2023, and 4Q2022 of $167, $0, and $82, respectively (in thousands)

    Net Interest Income Analysis

     Year Ended
     December 31, 2023 December 31, 2022
    (In thousands)Average
    Balance
    Income /
    Expense
    Yield /
    Rate
     Average
    Balance
    Income /
    Expense
    Yield /
    Rate
                
    Interest-earning assets:           
    Interest-bearing deposits in banks$142,053 $5,779 4.07% $258,214 $2,186 0.85%
    Securities(1) 3,250,788  160,298 4.93%  3,391,056  106,417 3.14%
    Resell agreements 10,233  705 6.89%  182,304  4,237 2.32%
    Loans receivable, net(2)(3) 4,259,195  191,295 4.49%  3,615,437  145,649 4.03%
    Total interest-earning assets 7,662,269  358,077 4.67%  7,447,011  258,489 3.47%
    Non-interest-earning assets:           
    Cash and due from banks 5,140      7,126    
    Other assets 208,902      273,028    
    Total assets$7,876,311     $7,727,165    
                
    Interest-bearing liabilities:           
    Savings, NOW and money market deposits$3,344,407 $59,818 1.79% $2,981,688 $10,068 0.34%
    Time deposits 167,167  3,452 2.07%  185,692  638 0.34%
    Brokered CDs 364,833  17,854 4.89%  9,338  349 3.74%
    Total interest-bearing deposits 3,876,407  81,124 2.09%  3,176,718  11,055 0.35%
    Other borrowings 350,039  15,642 4.47%  200,726  7,592 3.78%
    Total interest-bearing liabilities 4,226,446  96,766 2.29%  3,377,444  18,647 0.55%
    Non-interest-bearing liabilities:           
    Demand and transaction deposits 3,045,013      3,746,152    
    Other liabilities 73,770      82,931    
    Total liabilities 7,345,229      7,206,527    
    Stockholders' equity 531,082      520,638    
    Total liabilities and stockholders' equity$7,876,311     $7,727,165    
                
    Net interest income / interest rate spread  $261,311 2.38%   $239,842 2.92%
    Net interest-earning assets / net interest margin$3,435,823   3.41% $4,069,567   3.22%
                
    Total deposits excluding Brokered CDs / total cost of deposits excluding Brokered CDs$6,556,587   0.96% $6,913,532   0.15%
    Total deposits / total cost of deposits$6,921,420   1.17% $6,922,870   0.16%
    Total funding / total cost of funds$7,271,459   1.33% $7,123,596   0.26%

    (1) Includes Federal Home Loan Bank (FHLB) stock in the average balance, and dividend income on FHLB stock in interest income
    (2) Amounts are net of deferred origination costs. With the adoption of the CECL standard on January 1, 2023, the average balance of the allowance for credit losses on loans was reclassified for all presented periods to other assets to allow for comparability.
    (3) Includes prepayment penalty interest income in December YTD 2023 and December YTD 2022 of $0.1 million and $1.7 million, respectively

    Deposit Portfolio Composition

     Three Months Ended
     December 31, 2023 September 30, 2023 December 31, 2022
    (In thousands)Ending
    Balance
     Average
    Balance
     Ending
    Balance
     Average
    Balance
     Ending
    Balance
     Average
    Balance
    Non-interest-bearing demand deposit accounts$2,940,398 $2,921,961 $2,808,300 $2,920,737 $3,331,067 $3,522,352
    NOW accounts 200,382  191,889  192,654  192,883  206,434  200,633
    Money market deposit accounts 3,100,681  3,090,805  3,059,982  2,893,930  2,445,396  2,385,446
    Savings accounts 340,860  346,964  357,470  359,214  386,190  381,071
    Time deposits 187,457  183,225  180,529  176,171  151,699  167,138
    Brokered CDs 242,210  309,378  391,919  371,329  74,251  37,047
    Total deposits$7,011,988 $7,044,222 $6,990,854 $6,914,264 $6,595,037 $6,693,687
                
    Total deposits excluding Brokered CDs$6,769,778 $6,734,844 $6,598,935 $6,542,935 $6,520,786 $6,656,640
                      


     Three Months Ended
     December 31, 2023 September 30, 2023 December 31, 2022
     Average
    Rate
    Paid
    (1)
     Cost of
    Funds
     Average
    Rate
    Paid
    (1)
     Cost of
    Funds
     Average
    Rate
    Paid
    (1)
     Cost of
    Funds
                
    Non-interest-bearing demand deposit accounts0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
    NOW accounts0.99% 1.00% 0.95% 1.01% 0.73% 0.52%
    Money market deposit accounts2.89% 2.35% 2.31% 2.14% 0.94% 0.74%
    Savings accounts1.20% 1.15% 1.16% 1.14% 0.75% 0.49%
    Time deposits3.01% 3.08% 2.88% 2.53% 2.57% 0.41%
    Brokered CDs5.09% 5.24% 5.14% 5.21% 3.84% 3.72%
    Total deposits1.62% 1.43% 1.46% 1.33% 0.52% 0.34%
                
    Interest-bearing deposits excluding brokered CDs2.65% 2.21% 2.16% 2.00% 1.07% 0.68%
                
    (1)Average rate paid is calculated as the weighted average of spot rates on deposit accounts as of December 31, 2023.
     

    Asset Quality

    (In thousands)December 31,
    2023
     September 30,
    2023
     December 31,
    2022
    Loans 90 days past due and accruing$  $  $ 
    Nonaccrual loans held for sale 989   2,189   6,914 
    Nonaccrual loans - Commercial 23,189   28,041   18,308 
    Nonaccrual loans - Retail 9,994   6,283   3,391 
    Nonaccrual securities 31   31   36 
    Total nonperforming assets$34,203  $36,544  $28,649 
          
    Nonaccrual loans:     
    Commercial and industrial$7,533  $7,575  $9,629 
    Multifamily       3,828 
    Commercial real estate 4,490   4,575   4,851 
    Construction and land development 11,166   15,891    
    Total commercial portfolio 23,189   28,041   18,308 
          
    Residential real estate lending 7,218   3,009   1,807 
    Consumer solar 2,673   2,817   1,584 
    Consumer and other 103   457    
    Total retail portfolio 9,994   6,283   3,391 
    Total nonaccrual loans$33,183  $34,324  $21,699 
          
    Nonaccrual loans to total loans 0.75%  0.79%  0.53%
    Nonperforming assets to total assets 0.43%  0.46%  0.37%
    Allowance for credit losses on loans to nonaccrual loans 198%  198%  208%
    Allowance for credit losses on loans to total loans 1.49%  1.55%  1.10%
    Annualized net charge-offs (recoveries) to average loans 0.51%  0.27%  0.16%

    Credit Quality

     December 31, 2023 September 30, 2023 December 31, 2022
    ($ in thousands)     
    Criticized and classified loans     
    Commercial and industrial$69,843  $45,959  $32,004 
    Multifamily 10,306   10,999   19,860 
    Commercial real estate 8,637   8,762   35,180 
    Construction and land development 11,166   15,891   16,426 
    Residential real estate lending 7,218   3,009   1,807 
    Consumer solar 2,673   2,817   1,584 
    Consumer and other 103   457    
    Total loans$109,946  $87,894  $106,861 


          
    Criticized and classified loans to total loans     
    Commercial and industrial1.58% 1.05% 0.78%
    Multifamily0.23% 0.25% 0.48%
    Commercial real estate0.20% 0.20% 0.86%
    Construction and land development0.25% 0.36% 0.40%
    Residential real estate lending0.16% 0.07% 0.04%
    Consumer solar0.06% 0.06% 0.04%
    Consumer and other% 0.01% %
    Total loans2.48% 2.00% 2.60%
             

    Reconciliation of GAAP to Non-GAAP Financial Measures
    The information provided below presents a reconciliation of each of our non-GAAP financial measures to the most directly comparable GAAP financial measure.

     As of and for the As of and for the
     Three Months Ended Year Ended
    (in thousands)December 31,
    2023
     September 30,
    2023
     December 31,
    2022
     December 31,
    2023
     December 31,
    2022
    Core operating revenue         
    Net Interest income (GAAP)$67,319  $63,728  $67,346  $261,311  $239,840 
    Non-interest income 9,406   6,780   4,226   29,336   23,897 
    Less: Securities (gain) loss 2,340   1,699   1,373   7,392   3,637 
    Less: Subdebt repurchase gain    (637)     (1,417)  (617)
    Add: Tax (credits) depreciation on solar investments (3,251)     1,706   (3,251)  3,811 
    Core operating revenue (non-GAAP)$75,814  $71,570  $74,651  $293,371  $270,568 
              
    Core non-interest expense         
    Non-interest expense (GAAP)$37,752  $37,339  $35,570  $151,247  $140,571 
    Less: Other one-time expenses(1) (47)  (332)     (665)  (738)
    Core non-interest expense (non-GAAP)$37,705  $37,007  $35,570  $150,582  $139,833 
              
    Core net income         
    Net Income (GAAP)$22,695  $22,308  $24,755  $87,979  $81,477 
    Less: Securities (gain) loss 2,340   1,699   1,373   7,392   3,637 
    Less: Subdebt repurchase gain    (637)     (1,417)  (617)
    Add: Other one-time expenses 47   332      665   738 
    Add: Tax (credits) depreciation on solar investments (3,251)     1,706   (3,251)  3,811 
    Less: Tax on notable items 227   (396)  (664)  (909)  (1,867)
    Core net income (non-GAAP)$22,058  $23,306  $27,170  $90,459  $87,179 
              
    Tangible common equity         
    Stockholders' equity (GAAP)$585,364  $546,291  $508,955  $585,364  $508,955 
    Less: Minority interest (133)  (133)  (133)  (133)  (133)
    Less: Goodwill (12,936)  (12,936)  (12,936)  (12,936)  (12,936)
    Less: Core deposit intangible (2,217)  (2,439)  (3,105)  (2,217)  (3,105)
    Tangible common equity (non-GAAP)$570,078  $530,783  $492,781  $570,078  $492,781 
              
    Average tangible common equity         
    Average stockholders' equity (GAAP)$554,830  $538,753  $493,761  $531,082  $520,638 
    Less: Minority interest (133)  (133)  (133)  (133)  (133)
    Less: Goodwill (12,936)  (12,936)  (12,936)  (12,936)  (12,936)
    Less: Core deposit intangible (2,325)  (2,547)  (3,232)  (2,656)  (3,622)
    Average tangible common equity (non-GAAP)$539,436  $523,137  $477,460  $515,357  $503,947 
              
    Core return on average assets         
    Denominator: Total average assets (GAAP)$7,980,509  $7,904,566  $7,806,589  $7,876,312  $7,727,165 
    Core return on average assets (non-GAAP) 1.10%  1.17%  1.38%  1.15%  1.13%
              
    Core return on average tangible common equity         
    Denominator: Average tangible common equity$539,436  $523,137  $477,460  $515,357  $503,947 
    Core return on average tangible common equity (non-GAAP) 16.22%  17.67%  22.58%  17.55%  17.30%
              
    Core efficiency ratio         
    Numerator: Core non-interest expense (non-GAAP) 37,705   37,007   35,570   150,582   139,834 
    Core efficiency ratio (non-GAAP) 49.74%  51.71%  47.65%  51.33%  51.68%

    (1) Severance expense for positions eliminated plus, for 2022, expenses related to the termination of the merger agreement with Amalgamated Bank of Chicago.


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