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Dime Community Bancshares, Inc. Reports Third Quarter 2023 Results
ソース: Nasdaq GlobeNewswire / 19 10 2023 06:00:01 America/New_York
Growth in New Commercial Customers Leads to Average Deposits Increasing By $128 Million on a Linked Quarter Basis
Capital Ratios Continue to Grow and Asset Quality Remains Stable
HAUPPAUGE, N.Y., Oct. 19, 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 $13.2 million for the quarter ended September 30, 2023, or $0.34 per diluted common share, compared to net income available to common stockholders of $25.7 million for the quarter ended June 30, 2023, or $0.66 per diluted common share, and net income available to common stockholders of $37.7 million for the quarter ended September 30, 2022, or $0.98 per diluted common share.
Third quarter 2023 results include $8.9 million of aggregate pre-tax adjustments related to severance from the previously disclosed Chief Executive Officer succession and loss on equity securities. Excluding these items, adjusted net income available to common stockholders (non-GAAP) totaled $21.9 million for the quarter ended September 30, 2023, or $0.56 per diluted share (see “Non-GAAP Reconciliation” tables at the end of this news release).
Stuart H. Lubow, President and Chief Executive Officer (“CEO”) of the Company, stated, “Our third quarter results were characterized by good overall deposit growth, a stabilization in our non-interest-bearing deposit base and a continued reduction in the pace of net interest margin compression. Given our unique customer-focused platform, we continue to attract quality talent as evidenced by the addition of a senior healthcare banker in the third quarter. In light of the overall environment, we continue to manage expenses prudently and continue to fortify our balance sheet by building capital. I am incredibly proud of our employees for their tremendous contributions towards serving our customers; as a result of their efforts, we continue to be the premier community-based business bank on Greater Long Island.”
Highlights for the Third Quarter of 2023 Included:
- Average total deposits were $10.66 billion for the third quarter of 2023 compared to $10.54 billion for the second quarter of 2023;
- Non-insured deposits (excluding deposits with pass through insurance and collateralized deposits) represented only 29% of total deposits at the end of the third quarter;
- The ratio of average non-interest-bearing deposits to average total deposits for the third quarter and the second quarter of 2023 was 29%;
- Total net loans held for investment of $10.78 billion, remained stable on a linked quarter basis;
- The pace of Net Interest Margin (“NIM”) compression continued to slow in the third quarter; on a linked quarter basis, the NIM declined by 16 basis points in the third quarter of 2023 compared to 24 basis points for the second quarter of 2023 and 41 basis points for the first quarter of 2023;
- Expenses remained well-controlled; excluding the impact of severance, non-interest expenses was $51.0 million for the third quarter of 2023, compared to $51.7 million for the second quarter of 2023;
- Credit quality continues to be stable with non-performing assets and loans 90 days past due and accruing declining by 16% versus the linked quarter and representing only 0.17% of total assets as of September 30, 2023; and
- The Company’s Tier 1 Risk Based Capital Ratio of 10.76% was 26 basis points higher than the prior quarter.
Management’s Discussion of Quarterly Operating Results
Net Interest Income
Net interest income for the third quarter of 2023 was $76.5 million compared to $80.2 million for the second quarter of 2023 and $100.4 million for the third quarter of 2022.
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) Q3 2023 Q2 2023 Q3 2022 Net interest income $ 76,479 $ 80,219 $ 100,438 Purchase accounting amortization (accretion) on loans ("PAA") 186 58 (57 ) Adjusted net interest income excluding PAA on loans (non-GAAP) $ 76,665 $ 80,277 $ 100,381 Average interest-earning assets $ 12,984,061 $ 12,888,522 $ 11,782,361 NIM (1) 2.34 % 2.50 % 3.38 % Adjusted NIM excluding PAA on loans (non-GAAP) (2) 2.34 % 2.50 % 3.38 % (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 5.20% at September 30, 2023, an 8 basis point increase compared to the ending WAR of 5.12% on the total loan portfolio at June 30, 2023.
Outlined below are loan balances and WARs for the period ended as indicated.
September 30, 2023 June 30, 2023 September 30, 2022 (Dollars in thousands) Balance WAR Balance WAR Balance WAR Loans held for investment balances at period end: Business loans (2) $ 2,271,768 6.72 % $ 2,250,108 6.56 % $ 2,002,568 5.24 % One-to-four family residential, including condominium and cooperative apartment 892,869 4.39 855,980 4.17 722,081 3.77 Multifamily residential and residential mixed-use (3)(4) 4,102,024 4.45 4,132,358 4.38 3,968,244 3.83 Non-owner-occupied commercial real estate 3,374,281 5.09 3,406,232 5.04 3,174,102 4.33 Acquisition, development, and construction 203,402 8.92 225,580 8.99 241,019 6.75 Other loans 6,267 6.28 6,157 6.74 8,927 7.29 Loans held for investment $ 10,850,611 5.20 % $ 10,876,415 5.12 % $ 10,116,941 4.33 % (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 balance of loans in the category.
(2) Business loans include commercial and industrial loans, owner-occupied commercial real estate loans and Small Business Administration Paycheck Protection Program (“PPP”) loans.
(3) Includes loans underlying multifamily cooperatives.
(4) 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.
(Dollars in millions) Q3 2023 Q2 2023 Q3 2022 Loan originations $ 153.4 $ 296.6 $ 800.9 Deposits and Borrowed Funds
Period end total deposits (including mortgage escrow deposits) at September 30, 2023 were $10.64 billion, compared to $10.53 billion at June 30, 2023 and $10.25 billion at December 31, 2022. CEO Lubow commented, “During the third quarter we had good growth in business deposits driven by the deposit group hires we made in the second quarter. Given the growth in business deposits, we were able to pay down approximately $80 million of retail brokered deposits in the third quarter. Excluding brokered deposits, deposits increased approximately $200 million on a linked quarter basis.”
Total Federal Home Loan Bank advances were $1.12 billion at September 30, 2023 compared to $1.45 billion at June 30, 2023. Mr. Lubow stated, “During the third quarter we proactively paid down our Federal Home Loan Bank advance portfolio and we remain focused on operating a core deposit-funded institution.”
Non-Interest Income
Non-interest income was $7.9 million during the third quarter of 2023, $10.4 million during the second quarter of 2023, and $9.4 million during the third quarter of 2022. Included in non-interest income for the second quarter of 2023 was income related to mortality proceeds from a death claim of $645 thousand. 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 $59.5 million during the third quarter of 2023, $52.2 million during the second quarter of 2023, and $48.3 million during the third quarter of 2022. Excluding the impact of severance expense, loss on extinguishment of debt, and amortization of other intangible assets, adjusted non-interest expense was $50.6 million during the third quarter of 2023, $51.4 million during the second quarter of 2023, and $47.9 million during the third quarter of 2022 (see “Non-GAAP Reconciliation” tables at the end of this news release).
The ratio of non-interest expense to average assets was 1.73% during the third quarter of 2023, compared to 1.53% during the linked quarter and 1.54% for the third quarter of 2022. Excluding the impact of severance expense, loss on extinguishment of debt, and amortization of other intangible assets, the ratio of adjusted non-interest expense to average assets was 1.48% during the third quarter of 2023, compared to 1.51% during the linked quarter and 1.53% for the third quarter of 2022 (see “Non-GAAP Reconciliation” tables at the end of this news release).
The efficiency ratio was 70.5% during the third quarter of 2023, compared to 57.6% during the linked quarter and 44.0% during the third quarter of 2022. Excluding the impact of loss on equity securities, net loss on sale of securities and other assets, severance expense, loss on extinguishment of debt and amortization of other intangible assets the adjusted efficiency ratio was 59.7% during the third quarter of 2023, compared to 56.2% during the linked quarter and 44.2% during the second quarter of 2022 (see “Non-GAAP Reconciliation” tables at the end of this news release).
Income Tax Expense
The reported effective tax rate for the third quarter of 2023 was 35.1% compared to 26.8% for the second quarter of 2023. The increase in tax rate was primarily due to non-deductible severance expense during the period.
Credit Quality
Non-performing loans at September 30, 2023 were $23.3 million, 16% lower than the prior quarter.
A credit loss provision of $1.8 million was recorded during the third quarter of 2023, compared to a credit loss provision of $892 thousand during the second quarter of 2023, and a credit loss provision of $6.6 million during the third quarter of 2022. The credit loss provision in the third quarter of 2023 was primarily associated with increased provisioning for individually analyzed loans.
Capital Management
The Company’s and the Bank’s regulatory capital ratios continued to be in excess of all applicable regulatory requirements as of September 30, 2023. All of the Company’s and Bank’s risk-based regulatory capital ratios increased in the third quarter of 2023.
Dividends per common share were $0.25 during the third and second quarters of 2023, respectively.
Book value per common share was $28.03 at September 30, 2023 compared to $27.99 at June 30, 2023.
Tangible common book value per share (which represents common equity less goodwill and other intangible assets, divided by the number of shares outstanding) was $23.87 at September 30, 2023 compared to $23.82 at June 30, 2023. Excluding the impact of accumulated other comprehensive loss, the adjusted tangible common book value per share was $26.63 at September 30, 2023 compared to $26.51 at June 30, 2023 (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 Thursday, October 19, 2023, during which CEO Lubow will discuss the Company’s third quarter 2023 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/616795871.
Conference Call Details:
Dial-in for Live Call:
United States:
International:
Access code:
Telephone Replay:
A recording will be available until Thursday, November 2, 2023.
United States:
International:
Access code:1-833-470-1428
+1-929-526-1599
193919
1-866-813-9403
+44-204-525-0658
861279ABOUT 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 $13.7 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. 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)September 30, June 30, December 31, 2023 2023 2022 Assets: Cash and due from banks $ 358,824 $ 452,504 $ 169,297 Securities available-for-sale, at fair value 869,879 894,856 950,587 Securities held-to-maturity 600,291 603,960 585,798 Loans held for sale 3,924 371 — Loans held for investment, net: Business loans (1) 2,271,768 2,250,108 2,211,857 One-to-four family and cooperative/condominium apartment 892,869 855,980 773,321 Multifamily residential and residential mixed-use (2)(3) 4,102,024 4,132,358 4,026,826 Non-owner-occupied commercial real estate 3,374,281 3,406,232 3,317,485 Acquisition, development and construction 203,402 225,580 229,663 Other loans 6,267 6,157 7,679 Allowance for credit losses (72,563 ) (75,646 ) (83,507 ) Total loans held for investment, net 10,778,048 10,800,769 10,483,324 Premises and fixed assets, net 45,064 45,890 46,749 Restricted stock 90,085 104,724 88,745 Bank Owned Life Insurance ("BOLI") 347,400 337,083 333,292 Goodwill 155,797 155,797 155,797 Other intangible assets 5,409 5,758 6,484 Operating lease assets 55,600 54,931 57,857 Derivative assets 177,369 147,740 154,485 Accrued interest receivable 53,608 51,787 48,561 Other assets 109,202 146,692 108,945 Total assets $ 13,651,405 $ 13,802,862 $ 13,189,921 Liabilities: Non-interest-bearing checking (excluding mortgage escrow deposits) $ 2,935,156 $ 2,884,184 $ 3,449,763 Interest-bearing checking 630,686 960,465 827,454 Savings (excluding mortgage escrow deposits) 2,309,440 2,275,008 2,259,909 Money market 3,211,197 2,801,652 2,532,270 Certificates of deposit 1,442,299 1,530,749 1,115,364 Deposits (excluding mortgage escrow deposits) 10,528,778 10,452,058 10,184,760 Non-interest-bearing mortgage escrow deposits 107,545 70,431 69,455 Interest-bearing mortgage escrow deposits 223 203 192 Total mortgage escrow deposits 107,768 70,634 69,647 FHLBNY advances 1,123,000 1,448,000 1,131,000 Other short-term borrowings — — 1,360 Subordinated debt, net 200,218 200,240 200,283 Derivative cash collateral 185,620 140,160 153,040 Operating lease liabilities 58,281 57,547 60,340 Derivative liabilities 160,712 131,130 137,335 Other liabilities 82,684 100,590 82,573 Total liabilities 12,447,061 12,600,359 12,020,338 Stockholders' equity: Preferred stock, Series A 116,569 116,569 116,569 Common stock 416 416 416 Additional paid-in capital 494,470 493,955 495,410 Retained earnings 808,235 804,532 762,762 Accumulated other comprehensive loss ("AOCI"), net of deferred taxes (106,913 ) (104,385 ) (94,379 ) Unearned equity awards (10,170 ) (11,746 ) (8,078 ) Treasury stock, at cost (98,263 ) (96,838 ) (103,117 ) Total stockholders' equity 1,204,344 1,202,503 1,169,583 Total liabilities and stockholders' equity $ 13,651,405 $ 13,802,862 $ 13,189,921 (1) Business loans include commercial and industrial loans, owner-occupied commercial real estate loans and PPP loans.
(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.DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands except share and per share amounts)Three Months Ended Nine Months Ended September 30, June 30, September 30, September 30, September 30, 2023 2023 2022 2023 2022 Interest income: Loans $ 142,995 $ 138,310 $ 106,306 $ 409,744 $ 285,828 Securities 7,916 7,914 7,374 24,261 21,572 Other short-term investments 6,930 5,867 847 16,599 1,956 Total interest income 157,841 152,091 114,527 450,604 309,356 Interest expense: Deposits and escrow 62,507 52,616 10,154 152,395 16,416 Borrowed funds 16,925 17,759 3,483 50,855 9,334 Derivative cash collateral 1,930 1,497 452 4,904 547 Total interest expense 81,362 71,872 14,089 208,154 26,297 Net interest income 76,479 80,219 100,438 242,450 283,059 Provision (recovery) for credit losses 1,806 892 6,587 (950 ) 5,039 Net interest income after provision (recovery) 74,673 79,327 93,851 243,400 278,020 Non-interest income: Service charges and other fees 3,963 4,856 3,866 12,633 12,261 Title fees 291 246 474 829 1,578 Loan level derivative income 783 2,437 549 6,353 2,240 BOLI income 2,317 2,852 2,177 7,332 8,159 Gain on sale of SBA loans 335 210 211 1,061 1,176 Gain on sale of residential loans 21 34 54 103 393 Loss on equity securities (299 ) (780 ) — (1,079 ) — Net (loss) gain on sale of securities and other assets (22 ) — 1,397 (1,469 ) 1,397 Other 539 550 634 1,571 1,485 Total non-interest income 7,928 10,405 9,362 27,334 28,689 Non-interest expense: Salaries and employee benefits 30,520 29,900 29,188 87,054 88,476 Severance 8,562 481 — 9,068 2,193 Occupancy and equipment 7,277 7,144 7,884 21,794 22,864 Data processing costs 4,309 4,197 3,434 12,744 11,152 Marketing 2,079 1,488 1,531 5,016 4,341 Professional services 1,277 1,676 2,116 4,876 6,238 Federal deposit insurance premiums 1,866 1,874 800 5,613 3,100 Loss on extinguishment of debt — — — — 740 Amortization of other intangible assets 349 349 431 1,075 1,447 Other 3,284 5,077 2,918 11,944 9,477 Total non-interest expense 59,523 52,186 48,302 159,184 150,028 Income before taxes 23,078 37,546 54,911 111,550 156,681 Income tax expense 8,093 10,048 15,430 31,764 44,184 Net income 14,985 27,498 39,481 79,786 112,497 Preferred stock dividends 1,822 1,822 1,822 5,465 5,465 Net income available to common stockholders $ 13,163 $ 25,676 $ 37,659 $ 74,321 $ 107,032 Earnings per common share ("EPS"): Basic $ 0.34 $ 0.66 $ 0.98 $ 1.92 $ 2.74 Diluted $ 0.34 $ 0.66 $ 0.98 $ 1.92 $ 2.74 Average common shares outstanding for diluted EPS 38,203,961 38,175,993 38,165,681 38,177,704 38,678,894 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 Nine Months Ended September 30, June 30, September 30, September 30, September 30, 2023 2023 2022 2023 2022 Per Share Data: Reported EPS (Diluted) $ 0.34 $ 0.66 $ 0.98 $ 1.92 $ 2.74 Cash dividends paid per common share 0.25 0.25 0.24 0.74 0.72 Book value per common share 28.03 27.99 26.55 28.03 26.55 Tangible common book value per share (1) 23.87 23.82 22.34 23.87 22.34 Tangible common book value per share excluding AOCI (1) 26.63 26.51 24.75 26.63 24.75 Common shares outstanding 38,811 38,803 38,572 38,811 38,572 Dividend payout ratio 73.53 % 37.88 % 24.49 % 38.54 % 26.28 % Performance Ratios (Based upon Reported Net Income): Return on average assets 0.44 % 0.81 % 1.26 % 0.78 % 1.22 % Return on average equity 4.91 9.03 13.56 8.78 12.83 Return on average tangible common equity (1) 5.69 11.04 17.15 10.73 16.20 Net interest margin 2.34 2.50 3.38 2.52 3.29 Non-interest expense to average assets 1.73 1.53 1.54 1.56 1.63 Efficiency ratio 70.5 57.6 44.0 59.0 48.1 Effective tax rate 35.07 26.76 28.10 28.48 28.20 Balance Sheet Data: Average assets $ 13,759,493 $ 13,658,068 $ 12,550,626 $ 13,623,570 $ 12,292,051 Average interest-earning assets 12,984,061 12,888,522 11,782,361 12,853,701 11,511,149 Average tangible common equity (1) 943,805 940,054 885,182 933,072 889,044 Loan-to-deposit ratio at end of period (2) 102.0 103.4 96.5 102.0 96.5 Capital Ratios and Reserves - Consolidated: (3) Tangible common equity to tangible assets (1) 6.87 % 6.78 % 6.77 % Tangible common equity excluding AOCI to tangible assets (1) 7.66 7.54 7.45 Tangible equity to tangible assets (1) 7.73 7.63 7.69 Tangible equity excluding AOCI to tangible assets (1) 8.53 8.40 8.36 Tier 1 common equity ratio 9.67 9.44 9.13 Tier 1 risk-based capital ratio 10.76 10.50 10.25 Total risk-based capital ratio 13.33 13.06 12.98 Tier 1 leverage ratio 8.38 8.42 8.61 Consolidated CRE concentration ratio (4) 547 555 555 Allowance for credit losses/ Total loans 0.67 0.70 0.81 Allowance for credit losses/ Non-performing loans 311.16 273.42 199.45 (1) See "Non-GAAP Reconciliation" tables for reconciliation of tangible equity, tangible common equity, and tangible assets.
(2) Total deposits include mortgage escrow deposits, which fluctuate seasonally.
(3) September 30, 2023 amounts are preliminary pending completion and filing of the Company’s regulatory reports.
(4) The Consolidated CRE 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. September 30, 2023 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 September 30, 2023 June 30, 2023 September 30, 2022 Average Average Average Average Yield/ Average Yield/ Average Yield/ Balance Interest Cost Balance Interest Cost Balance Interest Cost Assets: Interest-earning assets: Business loans (1) $ 2,260,203 $ 38,384 6.74 % $ 2,259,769 $ 36,715 6.52 % $ 2,013,897 $ 26,153 5.15 % One-to-four family residential, including condo and coop 879,688 9,165 4.13 828,324 8,661 4.19 706,144 6,294 3.54 Multifamily residential and residential mixed-use 4,114,476 46,099 4.45 4,125,119 45,123 4.39 3,831,747 36,423 3.77 Non-owner-occupied commercial real estate 3,382,927 44,184 5.18 3,337,689 42,559 5.11 3,119,262 33,168 4.22 Acquisition, development, and construction 222,039 5,075 9.07 220,795 5,149 9.35 251,426 4,108 6.48 Other loans 6,156 88 5.67 6,536 103 6.32 10,566 160 6.01 Securities 1,619,960 7,916 1.94 1,642,057 7,914 1.93 1,666,398 7,374 1.76 Other short-term investments 498,612 6,930 5.51 468,233 5,867 5.03 182,921 847 1.84 Total interest-earning assets 12,984,061 157,841 4.82 % 12,888,522 152,091 4.73 % 11,782,361 114,527 3.86 % Non-interest-earning assets 775,432 769,546 768,265 Total assets $ 13,759,493 $ 13,658,068 $ 12,550,626 Liabilities and Stockholders' Equity: Interest-bearing liabilities: Interest-bearing checking (2) $ 786,892 $ 2,896 1.46 % $ 952,424 $ 3,081 1.30 % $ 833,386 $ 970 0.46 % Money market 2,975,267 24,275 3.24 2,713,816 18,284 2.70 2,651,459 2,046 0.31 Savings (2) 2,342,424 20,316 3.44 2,279,670 17,376 3.06 2,243,887 4,951 0.88 Certificates of deposit 1,494,491 15,020 3.99 1,546,257 13,875 3.60 988,827 2,187 0.88 Total interest-bearing deposits 7,599,074 62,507 3.26 7,492,167 52,616 2.82 6,717,559 10,154 0.60 FHLBNY advances 1,250,717 14,370 4.56 1,327,121 15,206 4.60 166,739 430 1.02 Subordinated debt, net 200,232 2,553 5.06 200,254 2,553 5.11 200,320 2,553 5.06 Other short-term borrowings 120 2 6.61 814 — — 75,975 500 2.61 Total borrowings 1,451,069 16,925 4.63 1,528,189 17,759 4.66 443,034 3,483 3.12 Derivative cash collateral 156,795 1,930 4.88 120,542 1,497 4.98 111,325 452 1.61 Total interest-bearing liabilities 9,206,938 81,362 3.51 % 9,140,898 71,872 3.15 % 7,271,918 14,089 0.77 % Non-interest-bearing checking (2) 3,065,186 3,043,899 3,894,093 Other non-interest-bearing liabilities 265,559 254,826 219,883 Total liabilities 12,537,683 12,439,623 11,385,894 Stockholders' equity 1,221,810 1,218,445 1,164,732 Total liabilities and stockholders' equity $ 13,759,493 $ 13,658,068 $ 12,550,626 Net interest income $ 76,479 $ 80,219 $ 100,438 Net interest rate spread 1.31 % 1.58 % 3.09 % Net interest margin 2.34 % 2.50 % 3.38 % Deposits (including non-interest-bearing checking accounts) (2) $ 10,664,260 $ 62,507 2.33 % $ 10,536,066 $ 52,616 2.00 % $ 10,611,652 $ 10,154 0.38 %
(1) Business loans include commercial and industrial loans, owner-occupied commercial real estate loans and PPP loans.
(2) Includes mortgage escrow deposits.DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SCHEDULE OF NON-PERFORMING ASSETS
(Dollars in thousands)At or For the Three Months Ended September 30, June 30, September 30, Asset Quality Detail 2023 2023 2022 Non-performing loans ("NPLs") Business loans (1) $ 19,555 $ 23,470 $ 34,706 One-to-four family residential, including condominium and cooperative apartment 2,874 3,305 3,219 Multifamily residential and residential mixed-use — — — Non-owner-occupied commercial real estate 15 15 2,499 Acquisition, development, and construction 657 657 657 Other loans 219 220 — Total Non-accrual loans $ 23,320 $ 27,667 $ 41,081 Total Non-performing assets ("NPAs") $ 23,320 $ 27,667 $ 41,081 Loans 90 days delinquent and accruing ("90+ Delinquent") Business loans $ — $ — $ 2,781 One-to-four family residential, including condominium and cooperative apartment — — — Multifamily residential and residential mixed-use — — — Non-owner-occupied commercial real estate — — — Acquisition, development, and construction — — — Other loans — — — 90+ Delinquent $ — $ — $ 2,781 NPAs and 90+ Delinquent $ 23,320 $ 27,667 $ 43,862 NPAs and 90+ Delinquent / Total assets 0.17 % 0.20 % 0.34 % Net charge-offs ("NCOs") $ 4,864 $ 3,679 $ 3,932 NCOs / Average loans (2) 0.18 % 0.14 % 0.16 % (1) Business loans include commercial and industrial loans, owner-occupied commercial real estate loans and PPP loans.
(2) 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 provides 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 loss on equity securities, net loss on sale of securities and other assets, severance and loss on extinguishment of debt:
Three Months Ended Nine Months Ended September 30, June 30, September 30, September 30, September 30, 2023 2023 2022 2023 2022 Reconciliation of Reported and Adjusted (non-GAAP) Net Income Available to Common Stockholders Reported net income available to common stockholders $ 13,163 $ 25,676 $ 37,659 $ 74,321 $ 107,032 Adjustments to net income (1): Loss on equity securities 299 780 — 1,079 — Net loss (gain) on sale of securities and other assets 22 — (1,397 ) 1,469 (1,397 ) Severance 8,562 481 — 9,068 2,193 Loss on extinguishment of debt — — — — 740 Income tax effect of adjustments and other tax adjustments (176 ) (373 ) 440 (985 ) 145 Adjusted net income available to common stockholders (non-GAAP) $ 21,870 $ 26,564 $ 36,702 $ 84,952 $ 108,713 Adjusted Ratios (Based upon Adjusted (non-GAAP) Net Income as calculated above) Adjusted EPS (Diluted) $ 0.56 $ 0.68 $ 0.95 $ 2.19 $ 2.78 Adjusted return on average assets 0.69 % 0.83 % 1.23 % 0.88 % 1.24 % Adjusted return on average equity 7.76 9.32 13.23 9.95 13.02 Adjusted return on average tangible common equity 9.38 11.42 16.72 12.25 16.45 Adjusted non-interest expense to average assets 1.48 1.51 1.53 1.46 1.58 Adjusted efficiency ratio 59.7 56.2 44.2 54.7 46.9 (1) Adjustments to net income are taxed at the Company's statutory tax rate of approximately 30% unless otherwise noted.
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 Nine Months Ended September 30, June 30, September 30, September 30, September 30, 2023 2023 2022 2023 2022 Operating expense as a % of average assets - as reported 1.73 % 1.53 % 1.54 % 1.56 % 1.63 % Loss on extinguishment of debt — — — — (0.01 ) Severance (0.25 ) (0.01 ) — (0.09 ) (0.02 ) Amortization of other intangible assets — (0.01 ) (0.01 ) (0.01 ) (0.02 ) Adjusted operating expense as a % of average assets (non-GAAP) 1.48 % 1.51 % 1.53 % 1.46 % 1.58 % The following table presents a reconciliation of efficiency ratio (non-GAAP) and adjusted efficiency ratio (non-GAAP):
Three Months Ended Nine Months Ended September 30, June 30, September 30, September 30, September 30, 2023 2023 2022 2023 2022 Efficiency ratio - as reported (non-GAAP) (1) 70.5 % 57.6 % 44.0 % 59.0 % 48.1% Non-interest expense - as reported $ 59,523 $ 52,186 $ 48,302 $ 159,184 $ 150,028 Severance (8,562 ) (481 ) — (9,068 ) (2,193 ) Loss on extinguishment of debt — — — — (740 ) Amortization of other intangible assets (349 ) (349 ) (431 ) (1,075 ) (1,447 ) Adjusted non-interest expense (non-GAAP) $ 50,612 $ 51,356 $ 47,871 $ 149,041 $ 145,648 Net interest income - as reported $ 76,479 $ 80,219 $ 100,438 $ 242,450 $ 283,059 Non-interest income - as reported $ 7,928 $ 10,405 $ 9,362 $ 27,334 $ 28,689 Loss on equity securities 299 780 — 1,079 — Net loss (gain) on sale of securities and other assets 22 — (1,397 ) 1,469 (1,397 ) Loss on termination of derivatives — — — — — Adjusted non-interest income (non-GAAP) $ 8,249 $ 11,185 $ 7,965 $ 29,882 $ 27,292 Adjusted total revenues for adjusted efficiency ratio (non-GAAP) $ 84,728 $ 91,404 $ 108,403 $ 272,332 $ 310,351 Adjusted efficiency ratio (non-GAAP) (2) 59.7 % 56.2 % 44.2 % 54.7 % 46.9 % (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):
September 30, June 30, September 30, 2023 2023 2022 Reconciliation of Tangible Assets: Total assets $ 13,651,405 $ 13,802,862 $ 12,885,903 Goodwill (155,797 ) (155,797 ) (155,797 ) Other intangible assets (5,409 ) (5,758 ) (6,915 ) Tangible assets (non-GAAP) $ 13,490,199 $ 13,641,307 $ 12,723,191 Reconciliation of Tangible Common Equity - Consolidated: Total stockholders' equity $ 1,204,344 $ 1,202,503 $ 1,140,791 Goodwill (155,797 ) (155,797 ) (155,797 ) Other intangible assets (5,409 ) (5,758 ) (6,915 ) Tangible equity (non-GAAP) 1,043,138 1,040,948 978,079 Preferred stock, net (116,569 ) (116,569 ) (116,569 ) Tangible common equity (non-GAAP) $ 926,569 $ 924,379 $ 861,510 Tangible common equity (non-GAAP) $ 926,569 $ 924,379 $ 861,510 AOCI, net of deferred taxes 106,913 104,385 93,036 Tangible common equity excluding AOCI (non-GAAP) $ 1,033,482 $ 1,028,764 $ 954,546 Tangible equity (non-GAAP) $ 1,043,138 $ 1,040,948 $ 978,079 AOCI, net of deferred taxes 106,913 104,385 93,036 Tangible equity excluding AOCI (non-GAAP) $ 1,150,051 $ 1,145,333 $ 1,071,115 Common shares outstanding 38,811 38,803 38,572 Tangible common equity to tangible assets (non-GAAP) 6.87% 6.78 % 6.77% Tangible common equity excluding AOCI to tangible assets (non-GAAP) 7.66 7.54 7.45 Tangible equity to tangible assets (non-GAAP) 7.73 7.63 7.69 Tangible equity excluding AOCI to tangible assets (non-GAAP) 8.53 8.40 8.36 Book value per share $ 28.03 $ 27.99 $ 26.55 Tangible common book value per share (non-GAAP) 23.87 23.82 22.34 Tangible common book value per share excluding AOCI (non-GAAP) 26.63 26.51 24.75