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Dime Community Bancshares, Inc. Reports Strong Fourth Quarter 2022 Results With Earnings Per Share Increasing By 19% On a Year-Over-Year Basis
ソース: Nasdaq GlobeNewswire / 27 1 2023 06:00:01 America/New_York
Robust Loan Originations Drive Over $1.3 Billion in Loan Growth for Fiscal Year 2022
Fourth Quarter Results Highlighted by Strong Non-Interest Income Growth,
Prudent Expense Management and Improved Credit QualityHAUPPAUGE, N.Y., Jan. 27, 2023 (GLOBE NEWSWIRE) -- Dime Community Bancshares, Inc. (NASDAQ: DCOM) (the “Company” or “Dime”), the parent company of Dime Community Bank (the “Bank”), today reported net income available to common stockholders of $145.3 million for the year ended December 31, 2022, or $3.73 per diluted common share, compared to $96.7 million for the year ended December 31, 2021 or $2.45 per diluted common share.
Kevin M. O’Connor, Chief Executive Officer (“CEO”) of the Company, stated, “As we close the book on 2022, we can reflect on an extremely successful year for our Company. Reported net income available to common shareholders for the twelve months ended December 31, 2022 increased by 50% on a year-over-year basis. Importantly, we delivered consistent financial results throughout 2022 as demonstrated by an annual return on assets in excess of 1.20% and an efficiency ratio below 50%. We made numerous investments in our business and people over the year, including a buildout of our middle market commercial lending operations. Finally, we were very proud to achieve an overall “Outstanding” rating for our Community Reinvestment Act rating from the Federal Reserve Bank of New York.”
For the quarter ended December 31, 2022, net income available to common stockholders was $38.2 million, or $0.99 per diluted common share, compared to $37.7 million, or $0.98 per diluted common share, for the quarter ended September 30, 2022, and $33.5 million, or $0.83 per diluted common share, for the quarter ended December 31, 2021.
Highlights for the Fourth Quarter of 2022 Included:
- Total loans held for investment, net, increased by $450 million or 18% on an annualized basis versus the linked quarter;
- Total business loan balances increased by $215 million or 43% on an annualized basis versus the linked quarter;
- Non-interest income increased to $9.5 million during the fourth quarter of 2022. Excluding the impact of a $1.4 million gain on sale of a branch property in the third quarter, non-interest income during the third quarter of 2022 was $8.0 million. The increase in non-interest income was driven by customer-related loan swap revenue and SBA gain on sale revenue;
- Non-interest expense to average assets remained well controlled at 1.56% for the fourth quarter, compared to 1.54% for the prior quarter and 1.64% for the year-ago quarter; and
- Credit quality continues to be strong with non-performing assets and loans 90 days past due and accruing declining by 22% versus the linked quarter and representing only 0.26% of total assets as of December 31, 2022.
Management’s Discussion of Quarterly Operating Results
Net Interest Income
Net interest income for the fourth quarter of 2022 was $96.8 million compared to $100.4 million for the third quarter of 2022 and $91.7 million for the fourth quarter of 2021.
The table below provides a reconciliation of the reported net interest margin (“NIM”) and adjusted NIM excluding the impact of purchase accounting accretion on the loan portfolio.
(Dollars in thousands) Q4 2022 Q3 2022 Q4 2021 Net interest income $ 96,804 $ 100,438 $ 91,686 Purchase accounting accretion on loans ("PAA") (390 ) (57 ) 625 Adjusted net interest income excluding PAA on loans (non-GAAP) $ 96,414 $ 100,381 $ 92,311 Average interest-earning assets $ 12,198,905 $ 11,782,361 $ 11,582,086 NIM (1) 3.15 % 3.38 % 3.14 % Adjusted NIM excluding PAA on loans (non-GAAP) (2) 3.14 % 3.38 % 3.16 % (1) NIM represents net interest income divided by average interest-earning assets.
(2) Adjusted NIM excluding PAA on loans represents adjusted net interest income, which excludes net interest income on PAA loans divided by average interest-earning assets.Loan Portfolio
The ending weighted average rate (“WAR”)(1) on the total loan portfolio was 4.76% at December 31, 2022, a 43 basis point increase compared to the ending WAR on the total loan portfolio at September 30, 2022.
Outlined below are loan balances and WARs for the period ended as indicated.
December 31, 2022 September 30, 2022 December 31, 2021 ($ in thousands) Balance WAR Balance WAR Balance WAR Loans held for investment balances at period end: Commercial and industrial ("C&I") $ 1,065,916 7.00 % $ 900,768 5.90 % $ 867,542 4.08 % Owner-occupied commercial real estate 1,140,145 5.16 1,090,417 4.69 1,030,240 4.05 Business loans 2,206,061 6.05 1,991,185 5.24 1,897,782 4.06 One-to-four family residential, including condominium and cooperative apartment 773,321 3.96 722,081 3.77 669,282 3.63 Multifamily residential and residential mixed-use (2)(3) 4,026,826 4.08 3,968,244 3.83 3,356,346 3.56 Non-owner-occupied commercial real estate 3,317,485 4.68 3,174,102 4.33 2,915,708 3.69 Acquisition, development, and construction 229,663 8.19 241,019 6.75 322,628 4.53 Other loans 7,679 10.22 8,927 7.29 16,898 5.85 Loans held for investment, excluding PPP loans 10,561,035 4.76 10,105,558 4.33 9,178,644 3.75 PPP loans 5,796 1.00 11,383 1.00 66,017 1.00 Total loans held for investment, including PPP loans $ 10,566,831 4.76 % $ 10,116,941 4.33 % $ 9,244,661 3.73 % (1) Weighted average rate is calculated by aggregating interest based on the current loan rate from each loan in the category, adjusted for non-accrual loans, divided by the total amount of loans in the category.
(2) Includes loans underlying multifamily cooperatives.
(3) While the loans within this category are often considered "commercial real estate" in nature, multifamily and loans underlying cooperatives are here reported separately from commercial real estate loans in order to emphasize the residential nature of the collateral underlying this significant component of the total loan portfolio.Outlined below are the loan originations, for the quarter ended as indicated.
($ in millions) Q4 2022 Q3 2022 Q4 2021 Loan originations $ 638.3 $ 800.9 $ 463.9 Deposits
Total average deposits for the fourth quarter of 2022 were $10.4 billion, compared to $10.6 billion for the third quarter of 2022. The cost of deposits increased by 46 basis points on a linked quarter basis. CEO O’Connor stated, “Despite the rapid increase in market interest rates and the competitive environment for deposit balances, we were able to maintain average non-interest bearing deposit balances to average total deposit balances at approximately 36.2% for the fourth quarter of 2022.”
Non-Interest Income
Non-interest income was $9.5 million during the fourth quarter of 2022, $9.4 million during the third quarter of 2022, and $10.2 million during the fourth quarter of 2021. Included in non-interest income during the third quarter of 2022 was a $1.4 million gain on the sale of a branch property.
Non-Interest Expense
Total non-interest expense was $50.7 million during the fourth quarter of 2022, $48.3 million during the third quarter of 2022, and $50.8 million during the fourth quarter of 2021. Excluding the impact of merger expenses and transaction costs, branch restructuring, severance expense, loss on extinguishment of debt, and amortization of other intangible assets, adjusted non-interest expense was $50.3 million during the fourth quarter of 2022, $47.9 million during the third quarter of 2022, and $48.7 million during the fourth quarter of 2021 (see “Non-GAAP Reconciliation” tables at the end of this news release).
The ratio of non-interest expense to average assets was 1.56% during the fourth quarter of 2022, compared to 1.54% during the linked quarter and 1.64% for the fourth quarter of 2021. Excluding the impact of merger expenses and transaction costs, branch restructuring, severance expense, loss on extinguishment of debt, and amortization of other intangible assets, the ratio of adjusted non-interest expense to average assets was 1.55% during the fourth quarter of 2022, compared to 1.53% during the linked quarter and 1.57% for the fourth quarter of 2021 (see “Non-GAAP Reconciliation” tables at the end of this news release).
The efficiency ratio was 47.7% during the fourth quarter of 2022, compared to 44.0% during the linked quarter and 49.9% during the fourth quarter of 2021. Excluding the impact of merger expenses and transaction costs, branch restructuring, severance expense, loss on extinguishment of debt, amortization of other intangible assets, and gain on sale of securities and other assets, the adjusted efficiency ratio was 47.3% during the fourth quarter of 2022, compared to 44.2% during the linked quarter and 48.2% during the fourth quarter of 2021 (see “Non-GAAP Reconciliation” tables at the end of this news release).
Income Tax Expense
The reported effective tax rate for the fourth quarter of 2022 was 27.5%, compared to 28.1% for the third quarter of 2022, and 30.9% for the fourth quarter of 2021.
Credit Quality
Non-performing loans at December 31, 2022 were $34.2 million, or 0.32% of total loans.
A credit loss provision of $0.3 million was recorded during the fourth quarter of 2022, compared to a credit loss provision of $6.6 million during the third quarter of 2022, and a credit loss recovery of $132 thousand during the fourth quarter of 2021. The credit loss provision for the fourth quarter of 2022 was associated with growth in the loan portfolio offset by a reduction in reserves on individually evaluated loans and unfunded commitments.
The allowance for credit losses as a percentage of total loans was 0.79% at December 31, 2022 as compared to 0.81% at September 30, 2022 and 0.91% at December 31, 2021.
Capital Management
The Company’s and the Bank’s regulatory capital ratios continued to be in excess of all applicable regulatory requirements as of December 31, 2022.
CEO O’Connor commented, “Our strong internal capital generation allowed us to keep our capital ratios steady in the quarter, while supporting approximately $450 million of quarterly loan growth. Over the course of 2022, we repurchased approximately $47 million of common stock, representing approximately 4% of shares outstanding at the beginning of the year. Our regulatory capital ratios, which exclude the impact of the accumulated other comprehensive loss component of stockholders’ equity, continue to be very strong.”
Dividends per common share were $0.24 during the fourth quarter of 2022.
Book value per common share was $27.41 at December 31, 2022 compared to $26.55 at September 30, 2022. Tangible common book value per share (which represents common equity less goodwill and other intangible assets, divided by the number of shares outstanding) was $23.20 at December 31, 2022 compared to $22.34 at September 30, 2022. Excluding the impact of accumulated other comprehensive income, the adjusted tangible common book value per share was $25.54 at December 31, 2022 compared to $24.75 at September 30, 2022 (see “Non-GAAP Reconciliation” tables at the end of this news release).
Earnings Call Information
The Company will conduct a conference call at 8:30 a.m. (ET) on Friday, January 27, 2023, during which CEO O’Connor will discuss the Company’s fourth quarter 2022 financial performance, with a question-and-answer session to follow.
The conference call will be simultaneously webcast (listen only) and archived for a period of one year at https://events.q4inc.com/attendee/499210648.
Conference Call Details:
Dial-in for Live Call:
United States: 1-844-200-6205 International: +1-929-526-1599 Access code: 269082 Telephone Replay:
A recording will be available until Friday, February 10, 2023.
United States: 1-866-813-9403 International: +44-204-525-0658 Access code: 964093 ABOUT DIME COMMUNITY BANCSHARES, INC.
Dime Community Bancshares, Inc. is the holding company for Dime Community Bank, a New York State-chartered trust company with over $13.1 billion in assets and the number one deposit market share among community banks on Greater Long Island(1).(1) Aggregate deposit market share for Kings, Queens, Nassau & Suffolk counties for community banks less than $20 billion in assets.
This news release contains a number of forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These statements may be identified by use of words such as “annualized," “anticipate," "believe," “continue,” "could," "estimate," "expect," "intend," “likely,” "may," "outlook," "plan," "potential," "predict," "project," "should," "will," "would" and similar terms and phrases, including references to assumptions.
Forward-looking statements are based upon various assumptions and analyses made by the Company in light of management's experience and its perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate under the circumstances. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors (many of which are beyond the Company's control) that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Accordingly, you should not place undue reliance on such statements. Factors that could affect our results include, without limitation, the following: the timing and occurrence or non-occurrence of events may be subject to circumstances beyond the Company’s control; there may be increases in competitive pressure among financial institutions or from non-financial institutions; changes in the interest rate environment may affect demand for our products and reduce interest margins and the value of our investments; changes in deposit flows, loan demand or real estate values may adversely affect the business of the Company; changes in the quality and composition of the Company’s loan or investment portfolios or unanticipated or significant increases in loan losses may negatively affect the Company’s financial condition or results of operations; changes in accounting principles, policies or guidelines may cause the Company’s financial condition to be perceived differently; changes in corporate and/or individual income tax laws may adversely affect the Company's financial condition or results of operations; general socio- economic conditions, including conditions caused by the COVID-19 pandemic and any other public health emergency, international conflict, inflation, and recessionary pressures, either nationally or locally in some or all areas in which the Company conducts business, or conditions in the securities markets or the banking industry may be less favorable than the Company currently anticipates and may adversely affect our customers, our financial results and our operations; legislation or regulatory changes may adversely affect the Company’s business; technological changes may be more difficult or expensive than the Company anticipates; there may be failures or breaches of information technology security systems; success or consummation of new business initiatives may be more difficult or expensive than the Company anticipates; and litigation or other matters before regulatory agencies, whether currently existing or commencing in the future, may delay the occurrence or non-occurrence of events longer than the Company anticipates. Further, given its ongoing and dynamic nature, it is difficult to predict what effects the COVID-19 pandemic will have on our business and results of operations. The pandemic and related local and national economic disruption may, among other effects, result in a decline in demand for our products and services; increased levels of loan delinquencies, problem assets and foreclosures; branch closures, work stoppages and unavailability of personnel; and increased cybersecurity risks, as employees work remotely. For discussion of these and other risks that may cause actual results to differ from expectations, please refer to the sections entitled “Forward-Looking Statements” and “Risk Factors” in the Company’s most recent Annual Report on Form 10-K and updates set forth in the Company’s subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
Contact: Avinash Reddy Senior Executive Vice President – Chief Financial Officer 718-782-6200 extension 5909 DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(In thousands)December 31, September 30, December 31, 2022 2022 2021 Assets: Cash and due from banks $ 169,297 $ 312,996 $ 393,722 Securities available-for-sale, at fair value 950,587 962,927 1,563,711 Securities held-to-maturity 585,798 591,403 179,309 Loans held for sale — 289 5,493 Loans held for investment, net: C&I 1,065,916 900,768 867,542 Owner-occupied commercial real estate 1,140,145 1,090,417 1,030,240 Total business loans 2,206,061 1,991,185 1,897,782 One-to-four family and cooperative/condominium apartment 773,321 722,081 669,282 Multifamily residential and residential mixed-use (1)(2) 4,026,826 3,968,244 3,356,346 Non-owner-occupied commercial real estate 3,317,485 3,174,102 2,915,708 Acquisition, development, and construction 229,663 241,019 322,628 Small Business Administration ("SBA") Paycheck Protection Program ("PPP") loans 5,796 11,383 66,017 Other loans 7,679 8,927 16,898 Allowance for credit losses (83,507 ) (81,935 ) (83,853 ) Total loans held for investment, net 10,483,324 10,035,006 9,160,808 Premises and fixed assets, net 46,749 47,406 50,368 Premises held for sale — — 556 Restricted stock 88,745 65,656 37,732 Bank Owned Life Insurance ("BOLI") 333,292 331,105 295,789 Goodwill 155,797 155,797 155,797 Other intangible assets 6,484 6,915 8,362 Operating lease assets 57,857 57,916 64,258 Derivative assets 154,485 162,679 45,086 Accrued interest receivable 48,561 41,567 40,149 Other assets 113,084 114,241 65,224 Total assets $ 13,194,060 $ 12,885,903 $ 12,066,364 Liabilities: Non-interest-bearing checking $ 3,519,218 $ 3,830,676 $ 3,920,423 Interest-bearing checking 827,454 936,082 905,717 Savings 2,260,101 2,237,409 1,158,040 Money market 2,532,270 2,553,729 3,621,552 Certificates of deposit 1,115,364 930,774 853,242 Total deposits 10,254,407 10,488,670 10,458,974 FHLBNY advances 1,131,000 620,000 25,000 Other short-term borrowings 1,360 2,124 1,862 Subordinated debt, net 200,283 200,305 197,096 Derivative cash collateral 153,040 158,200 4,550 Operating lease liabilities 60,340 60,252 66,103 Derivative liabilities 137,335 144,343 40,728 Other liabilities 82,573 71,218 79,431 Total liabilities 12,020,338 11,745,112 10,873,744 Stockholders' equity: Preferred stock, Series A 116,569 116,569 116,569 Common stock 416 416 416 Additional paid-in capital 495,410 495,232 494,125 Retained earnings 762,762 733,783 654,726 Accumulated other comprehensive loss ("AOCI"), net of deferred taxes (90,240 ) (93,036 ) (6,181 ) Unearned equity awards (8,078 ) (9,177 ) (7,842 ) Treasury stock, at cost (103,117 ) (102,996 ) (59,193 ) Total stockholders' equity 1,173,722 1,140,791 1,192,620 Total liabilities and stockholders' equity $ 13,194,060 $ 12,885,903 $ 12,066,364 (1) Includes loans underlying multifamily cooperatives.
(2) While the loans within this category are often considered "commercial real estate" in nature, multifamily and loans underlying cooperatives are here reported separately from commercial real estate loans in order to emphasize the residential nature of the collateral underlying this significant component of the total loan portfolio.DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands except share and per share amounts)Three Months Ended Year Ended December 31, September 30, December 31, December 31, December 31, 2022 2022 2021 2022 2021 Interest income: Loans $ 120,773 $ 106,306 $ 89,301 $ 406,601 $ 359,016 Securities 7,652 7,374 7,097 29,224 22,634 Other short-term investments 1,444 847 414 3,400 2,976 Total interest income 129,869 114,527 96,812 439,225 384,626 Interest expense: Deposits and escrow 22,017 10,154 2,861 38,433 16,527 Borrowed funds 9,783 3,483 2,265 19,117 10,490 Derivative cash collateral 1,265 452 — 1,812 — Total interest expense 33,065 14,089 5,126 59,362 27,017 Net interest income 96,804 100,438 91,686 379,863 357,609 Provision (credit) for credit losses 335 6,587 (132 ) 5,374 6,212 Net interest income after provision (credit) 96,469 93,851 91,818 374,489 351,397 Non-interest income: Service charges and other fees 3,945 3,866 4,621 16,206 15,998 Title fees 453 474 735 2,031 2,338 Loan level derivative income 1,397 549 113 3,637 2,909 BOLI income 2,187 2,177 1,890 10,346 7,071 Gain on sale of SBA loans 621 211 851 1,797 2,336 Gain on sale of PPP loans — — — — 20,697 Gain on sale of residential loans 55 54 225 448 1,758 Net gain on equity securities — — — — 131 Net gain on sale of securities and other assets — 1,397 975 1,397 1,705 Loss on termination of derivatives — — — — (16,505 ) Other 809 634 769 2,294 3,630 Total non-interest income 9,467 9,362 10,179 38,156 42,068 Non-interest expense: Salaries and employee benefits 31,632 29,188 27,638 120,108 108,331 Severance 5 — — 2,198 1,875 Occupancy and equipment 7,356 7,884 7,784 30,220 30,697 Data processing costs 4,023 3,434 4,506 15,175 16,638 Marketing 1,559 1,531 1,959 5,900 4,661 Professional services 1,831 2,116 2,130 8,069 9,284 Federal deposit insurance premiums 800 800 1,031 3,900 4,077 Loss on extinguishment of debt — — — 740 1,751 Curtailment loss — — — — 1,543 Merger expenses and transaction costs — — 2,574 — 44,824 Branch restructuring — — (1,118 ) — 5,059 Amortization of other intangible assets 431 431 715 1,878 2,622 Other 3,065 2,918 3,610 12,542 13,937 Total non-interest expense 50,702 48,302 50,829 200,730 245,299 Income before taxes 55,234 54,911 51,168 211,915 148,166 Income tax expense 15,175 15,430 15,811 59,359 44,170 Net income 40,059 39,481 35,357 152,556 103,996 Preferred stock dividends 1,821 1,822 1,821 7,286 7,286 Net income available to common stockholders $ 38,238 $ 37,659 $ 33,536 $ 145,270 $ 96,710 Earnings per common share ("EPS"): Basic $ 0.99 $ 0.98 $ 0.83 $ 3.73 $ 2.45 Diluted $ 0.99 $ 0.98 $ 0.83 $ 3.73 $ 2.45 Average common shares outstanding for diluted EPS 38,123,221 38,165,681 39,876,825 38,538,834 38,903,037 DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SELECTED FINANCIAL HIGHLIGHTS
(Dollars in thousands except per share amounts)At or For the Three Months Ended At or For the Year Ended December 31, September 30, December 31, December 31, December 31, 2022 2022 2021 2022 2021 Per Share Data: Reported EPS (Diluted) $ 0.99 $ 0.98 $ 0.83 $ 3.73 $ 2.45 Cash dividends paid per common share 0.24 0.24 0.24 0.96 0.96 Book value per common share 27.41 26.55 26.98 27.41 26.98 Tangible common book value per share (1) 23.20 22.34 22.87 23.20 22.87 Tangible common book value per share excluding AOCI (1) 25.54 24.75 23.02 25.54 23.02 Common shares outstanding 38,573 38,572 39,878 38,573 39,878 Dividend payout ratio 24.24 % 24.49 % 28.92 % 25.74 % 39.18 % Performance Ratios (Based upon Reported Net Income): Return on average assets 1.23 % 1.26 % 1.14 % 1.22 % 0.86 % Return on average equity 13.72 13.56 11.67 13.05 8.96 Return on average tangible common equity (1) 17.34 17.15 14.61 16.48 11.09 Net interest margin 3.15 3.38 3.14 3.25 3.15 Non-interest expense to average assets 1.56 1.54 1.64 1.61 2.03 Efficiency ratio (1) 47.7 44.0 49.9 48.0 61.4 Effective tax rate 27.47 28.10 30.90 28.01 29.81 Balance Sheet Data: Average assets $ 12,985,248 $ 12,550,626 $ 12,419,184 $ 12,466,774 $ 12,112,800 Average interest-earning assets 12,198,905 11,782,361 11,582,086 11,684,501 11,354,111 Average tangible common equity (1) 889,018 885,182 931,503 889,038 888,128 Loan-to-deposit ratio at end of period 103.0 96.5 88.4 103.0 88.4 Capital Ratios and Reserves - Consolidated: (3) Tangible common equity to tangible assets (1) 6.87 % 6.77 % 7.66 % Tangible common equity excluding AOCI to tangible assets (1) 7.51 7.45 7.71 Tangible equity to tangible assets (1) 7.76 7.69 8.64 Tangible equity excluding AOCI to tangible assets (1) 8.40 8.36 8.69 Tier 1 common equity ratio 9.15 9.13 9.49 Tier 1 risk-based capital ratio 10.23 10.25 10.69 Total risk-based capital ratio 12.89 12.98 13.45 Tier 1 leverage ratio 8.53 8.61 8.46 CRE consolidated concentration ratio (2) 554 555 519 Allowance for credit losses/ Total loans 0.79 0.81 0.91 Allowance for credit losses/ Non-performing loans 243.91 199.45 208.04 (1) See "Non-GAAP Reconciliation" tables for reconciliation of tangible equity, tangible common equity, and tangible assets.
(2) The CRE consolidated concentration ratio is calculated using the sum of commercial real estate, excluding owner-occupied commercial real estate, multifamily, and acquisition, development, and construction, divided by consolidated capital. December 31, 2022 amounts are preliminary pending completion and filing of the Company’s regulatory reports.
(3) December 31, 2022 amounts are preliminary pending completion and filing of the Company’s regulatory reports.DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED AVERAGE BALANCES AND NET INTEREST INCOME
(Dollars in thousands)Three Months Ended December 31, 2022 September 30, 2022 December 31, 2021 Average Average Average Average Yield/ Average Yield/ Average Yield/ Balance Interest Cost Balance Interest Cost Balance Interest Cost Assets: Interest-earning assets: Real estate loans $ 9,370,045 $ 104,218 4.41 % $ 8,981,848 $ 92,309 4.08 % $ 8,293,470 $ 78,367 3.75 % Commercial and industrial loans 957,151 16,430 6.81 940,628 13,837 5.84 969,338 10,702 4.38 Other loans 8,269 125 6.00 10,566 160 6.01 18,385 232 5.01 Securities 1,663,969 7,652 1.82 1,666,398 7,374 1.76 1,729,191 7,097 1.63 Other short-term investments 199,471 1,444 2.87 182,921 847 1.84 571,702 414 0.29 Total interest-earning assets 12,198,905 129,869 4.22 % 11,782,361 114,527 3.86 % 11,582,086 96,812 3.32 % Non-interest-earning assets 786,343 768,265 837,098 Total assets $ 12,985,248 $ 12,550,626 $ 12,419,184 Liabilities and Stockholders' Equity: Interest-bearing liabilities: Interest-bearing checking $ 845,530 $ 1,174 0.55 % $ 833,386 $ 970 0.46 % $ 962,597 $ 455 0.19 % Money market 2,469,177 6,620 1.06 2,651,459 2,046 0.31 3,652,681 1,087 0.12 Savings 2,234,968 9,889 1.76 2,243,887 4,951 0.88 1,174,719 108 0.04 Certificates of deposit 1,063,053 4,334 1.62 988,827 2,187 0.88 915,210 1,211 0.52 Total interest-bearing deposits 6,612,728 22,017 1.32 6,717,559 10,154 0.60 6,705,207 2,861 0.17 FHLBNY advances 724,902 6,383 3.49 166,739 430 1.02 25,000 61 0.97 Subordinated debt, net 200,298 2,553 5.06 200,320 2,553 5.06 197,126 2,204 4.44 Other short-term borrowings 90,275 847 3.72 75,975 500 2.61 2,484 — — Total borrowings 1,015,475 9,783 3.82 443,034 3,483 3.12 224,610 2,265 4.00 Derivative cash collateral 157,898 1,265 3.18 111,325 452 1.61 3,842 — — Total interest-bearing liabilities 7,786,101 33,065 1.68 % 7,271,918 14,089 0.77 % 6,933,659 5,126 0.29 % Non-interest-bearing checking 3,755,395 3,894,093 4,092,204 Other non-interest-bearing liabilities 275,636 219,883 181,074 Total liabilities 11,817,132 11,385,894 11,206,937 Stockholders' equity 1,168,116 1,164,732 1,212,247 Total liabilities and stockholders' equity $ 12,985,248 $ 12,550,626 $ 12,419,184 Net interest income $ 96,804 $ 100,438 $ 91,686 Net interest rate spread 2.54 % 3.09 % 3.03 % Net interest margin 3.15 % 3.38 % 3.14 % Deposits (including non-interest-bearing checking accounts) $ 10,368,123 $ 22,017 0.84 % $ 10,611,652 $ 10,154 0.38 % $ 10,797,411 $ 2,861 0.11 % DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SCHEDULE OF NON-PERFORMING ASSETS
(Dollars in thousands)At or For the Three Months Ended December 31, September 30, December 31, Asset Quality Detail 2022 2022 2021 Non-performing loans ("NPLs") One-to-four family residential, including condominium and cooperative apartment $ 3,203 $ 3,219 $ 7,623 Multifamily residential and residential mixed-use — — — Commercial real estate 8,332 7,673 5,053 Acquisition, development, and construction 657 657 — C&I 21,946 29,532 27,266 Other 99 — 365 Total Non-accrual loans $ 34,237 $ 41,081 $ 40,307 Total Non-performing assets ("NPAs") $ 34,237 $ 41,081 $ 40,307 Loans 90 days delinquent and accruing ("90+ Delinquent") One-to-four family residential, including condominium and cooperative apartment $ — $ — $ 1,945 Multifamily residential and residential mixed-use — — — Commercial real estate — — — Acquisition, development, and construction — — — C&I — 2,781 1,056 Other — — — 90+ Delinquent $ — $ 2,781 $ 3,001 NPAs and 90+ Delinquent $ 34,237 $ 43,862 $ 43,308 NPAs and 90+ Delinquent / Total assets 0.26 % 0.34 % 0.36 % Net charge-offs (recoveries) ("NCOs") $ 185 $ 3,932 $ (108 ) NCOs / Average loans (1) 0.01 % 0.16 % 0.00 % (1) Calculated based on annualized NCOs to average loans, excluding loans held for sale.
DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
NON-GAAP RECONCILIATION
(Dollars in thousands except per share amounts)The following tables below provide a reconciliation of certain financial measures calculated under generally accepted accounting principles ("GAAP") (as reported) and non-GAAP measures. A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts that are required to be disclosed in the most directly comparable measure calculated and presented in accordance with GAAP in the United States. The Company’s management believes the presentation of non-GAAP financial measures provide investors with a greater understanding of the Company’s operating results in addition to the results measured in accordance with GAAP. While management uses these non-GAAP measures in its analysis of the Company’s performance, this information should not be viewed as a substitute for financial results determined in accordance with GAAP or considered to be more important than financial results determined in accordance with GAAP.
The following non-GAAP financial measures exclude pre-tax income and expenses associated with the Company’s February 2021 merger with Bridge Bancorp, Inc., as well as a gain on sale of a branch property, branch restructuring, gain on sale of PPP loans, severance, and loss on extinguishment of debt:
Three Months Ended Year Ended December 31, September 30, December 31, December 31, December 31, 2022 2022 2021 2022 2021 Reconciliation of Reported and Adjusted (non-GAAP) Net Income Available to Common Stockholders Reported net income available to common stockholders $ 38,238 $ 37,659 $ 33,536 $ 145,270 $ 96,710 Adjustments to net income (1): Provision for credit losses - Non-PCD loans (double-count) — — — — 20,278 Gain on sale of PPP loans — — — — (20,697 ) Net gain on sale of securities and other assets — (1,397 ) (975 ) 1,397 (1,685 ) Loss on termination of derivatives — — — — 16,505 Severance 5 — — 2,198 1,875 Loss on extinguishment of debt — — — 740 1,751 Curtailment loss — — — — 1,543 Merger expenses and transaction costs (2) — — 2,574 — 44,824 Branch restructuring — — (1,118 ) — 5,059 Income tax effect of adjustments and other tax adjustments — 440 (234 ) 145 (19,421 ) Adjusted net income available to common stockholders (non-GAAP) $ 38,243 $ 36,702 $ 33,783 $ 149,750 $ 146,742 Adjusted Ratios (Based upon non-GAAP as calculated above) Adjusted EPS (Diluted) $ 0.99 $ 0.95 $ 0.84 $ 3.77 $ 3.73 Adjusted return on average assets 1.23 % 1.23 % 1.15 % 1.24 % 1.27 % Adjusted return on average equity 13.72 13.23 11.75 13.20 13.26 Adjusted return on average tangible common equity 17.34 16.72 14.72 16.67 16.73 Adjusted non-interest expense to average assets 1.55 1.53 1.57 1.57 1.55 Adjusted efficiency ratio 47.3 44.2 48.2 47.0 47.6 (1) Adjustments to net income are taxed at the Company's statutory tax rate of approximately 31% unless otherwise noted.
(2) Certain merger expenses and transaction costs are non-taxable expense.The following table presents a reconciliation of operating expense as a percentage of average assets (as reported) and adjusted operating expense as a percentage of average assets (non-GAAP):
Three Months Ended Year Ended December 31, September 30, December 31, December 31, December 31, 2022 2022 2021 2022 2021 Operating expense as a % of average assets - as reported 1.56 % 1.54 % 1.64 % 1.61 % 2.03 % Loss on extinguishment of debt — — — (0.01 ) (0.01 ) Curtailment loss — — — — (0.02 ) Severance — — — (0.02 ) (0.02 ) Merger expenses and transaction costs — — (0.08 ) — (0.37 ) Branch restructuring — — 0.03 — (0.04 ) Amortization of other intangible assets (0.01 ) (0.01 ) (0.02 ) (0.02 ) (0.02 ) Adjusted operating expense as a % of average assets (non-GAAP) 1.55 1.53 1.57 1.57 1.55 The following table presents a reconciliation of efficiency ratio (non-GAAP) and adjusted efficiency ratio (non-GAAP):
Three Months Ended Year Ended December 31, September 30, December 31, December 31, December 31, 2022 2022 2021 2022 2021 Efficiency ratio - as reported (non-GAAP) (1) 47.7 % 44.0 % 49.9 % 48.0 % 61.4 % Non-interest expense - as reported $ 50,702 $ 48,302 $ 50,829 $ 200,730 $ 245,299 Severance (5 ) — — (2,198 ) (1,875 ) Merger expenses and transaction costs — — (2,574 ) — (44,824 ) Branch restructuring — — 1,118 — (5,059 ) Loss on extinguishment of debt — — — (740 ) (1,751 ) Curtailment loss — — — — (1,543 ) Amortization of other intangible assets (431 ) (431 ) (715 ) (1,878 ) (2,622 ) Adjusted non-interest expense (non-GAAP) $ 50,266 $ 47,871 $ 48,658 $ 195,914 $ 187,625 Net interest income - as reported $ 96,804 $ 100,438 $ 91,686 $ 379,863 $ 357,609 Non-interest income - as reported $ 9,467 $ 9,362 $ 10,179 $ 38,156 $ 42,068 Gain on sale of PPP loans — — — — (20,697 ) Net gain on sale of securities and other assets — (1,397 ) (975 ) (1,397 ) (1,685 ) Loss on termination of derivatives — — — — 16,505 Adjusted non-interest income (non-GAAP) $ 9,467 $ 7,965 $ 9,204 $ 36,759 $ 36,191 Adjusted total revenues for adjusted efficiency ratio (non-GAAP) $ 106,271 $ 108,403 $ 100,890 $ 416,622 $ 393,800 Adjusted efficiency ratio (non-GAAP) (2) 47.3 % 44.2 % 48.2 % 47.0 % 47.6 % (1) The reported efficiency ratio is a non-GAAP measure calculated by dividing GAAP non-interest expense by the sum of GAAP net interest income and GAAP non-interest income.
(2) The adjusted efficiency ratio is a non-GAAP measure calculated by dividing adjusted non-interest expense by the sum of GAAP net interest income and adjusted non-interest income.The following table presents the tangible common equity to tangible assets, tangible equity to tangible assets, and tangible common book value per share calculations (non-GAAP):
December 31, September 30, December 31, 2022 2022 2021 Reconciliation of Tangible Assets: Total assets $ 13,194,060 $ 12,885,903 $ 12,066,364 Goodwill (155,797 ) (155,797 ) (155,797 ) Other intangible assets (6,484 ) (6,915 ) (8,362 ) Tangible assets (non-GAAP) $ 13,031,779 $ 12,723,191 $ 11,902,205 Reconciliation of Tangible Common Equity - Consolidated: Total stockholders' equity $ 1,173,722 $ 1,140,791 $ 1,192,620 Goodwill (155,797 ) (155,797 ) (155,797 ) Other intangible assets (6,484 ) (6,915 ) (8,362 ) Tangible equity (non-GAAP) 1,011,441 978,079 1,028,461 Preferred stock, net (116,569 ) (116,569 ) (116,569 ) Tangible common equity (non-GAAP) $ 894,872 $ 861,510 $ 911,892 Tangible common equity (non-GAAP) $ 894,872 $ 861,510 $ 911,892 AOCI, net of deferred taxes 90,240 93,036 6,181 Tangible common equity excluding AOCI (non-GAAP) $ 985,112 $ 954,546 $ 918,073 Tangible equity (non-GAAP) $ 1,011,441 $ 978,079 $ 1,028,461 AOCI, net of deferred taxes 90,240 93,036 6,181 Tangible equity excluding AOCI (non-GAAP) $ 1,101,681 $ 1,071,115 $ 1,034,642 Common shares outstanding 38,573 38,572 39,878 Tangible common equity to tangible assets (non-GAAP) 6.87 % 6.77 % 7.66 % Tangible common equity excluding AOCI to tangible assets (non-GAAP) 7.51 7.45 7.71 Tangible equity to tangible assets (non-GAAP) 7.76 7.69 8.64 Tangible equity excluding AOCI to tangible assets (non-GAAP) 8.40 8.36 8.69 Book value per share $ 27.41 $ 26.55 $ 26.98 Tangible common book value per share (non-GAAP) 23.20 22.34 22.87 Tangible common book value per share excluding AOCI (non-GAAP) 25.54 24.75 23.02 
