8-K
FLUSHING FINANCIAL CORP (FFIC)
8-K
2024-11-07
For: 2024-11-07
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April 09, 2026
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 7, 2024
FLUSHING FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
001-33013
(Commission File Number)
Delaware
(State or Other Jurisdiction of Incorporation)
11-3209278
(I.R.S. Employer Identification No.)
220 RXR Plaza , Uniondale , NY **** 11556
(Address of principal executive offices)
( 718 ) 961-5400
(Registrant's telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock, $0.01 par value | FFIC | The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 7.01. Regulation FD Disclosure.
On November 7, 2024, Flushing Financial Corp. (the “Company”) made available to investors, and to post on its website, the presentation attached hereto as Exhibit 99.1.
Item 9.01. Financial Statements and Exhibits.
| Exhibit 99.1. Presentation dated November 7, 2024. |
|---|
| 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| us | | |
|---|---|---|
| | FLUSHING FINANCIAL CORPORATION | |
| | | |
| | | |
| Date: November 7, 2024 | By: | /s/ SUSAN K. CULLEN |
| | | Susan K. Cullen |
| | | Senior Executive Vice President, Chief Financial Officer |
| | | And Treasurer. |
Exhibit 99.1
| Hovde Group Financial Services Conference<br>November 7-8, 2024 |
|---|
| Safe Harbor Statement<br>2<br>“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: Statements<br>in this Presentation relating to plans, strategies, economic performance and trends, projections<br>of results of specific activities or investments and other statements that are not descriptions of<br>historical facts may be forward-looking statements within the meaning of the Private Securities<br>Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the<br>Securities Exchange Act of 1934. Forward-looking information is inherently subject to risks and<br>uncertainties, and actual results could differ materially from those currently anticipated due to a<br>number of factors, which include, but are not limited to, risk factors discussed in the Company’s<br>Annual Report on Form 10-K for the fiscal year ended December 31, 2023, and in other<br>documents filed by the Company with the Securities and Exchange Commission from time to<br>time. Forward-looking statements may be identified by terms such as “may”, “will”, “should”,<br>“could”, “expects”, “plans”, “intends”, “anticipates”, “believes”, “estimates”, “predicts”, “forecasts”,<br>“goals”, “potential” or “continue” or similar terms or the negative of these terms. Although we<br>believe that the expectations reflected in the forward-looking statements are reasonable, we<br>cannot guarantee future results, levels of activity, performance or achievements. The Company<br>has no obligation to update these forward-looking statements. |
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| 3<br>Key Messages<br>Conservative Underwriting with History of Solid Value Creation<br>► Leading Community Bank in the Greater NYC Area<br>► Well Diversified and Low Risk Loan Portfolio<br>► History of Sound Credit Quality since IPO in 1995<br>► Growing Asian Banking Niche<br>► Beneficiary of a Steepening Yield Curve |
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| Flushing Financial Snapshot (NASDAQ: FFIC)<br>Balance Sheet<br>Assets $9.3B<br>Loans, net $6.8B<br>Total Deposits $7.69B<br>Equity $0.7B<br>Performance<br>GAAP/Core ROAA 0.39%/0.34%1<br>GAAP/Core ROAE 5.30%/4.59%1<br>GAAP/Core NIM 2.10%/2.07%2<br>Book/Tangible Book Value $22.94/$22.29<br>3Q24 Key Statistics<br>Footprint<br>Deposits primarily from 28 branches in multicultural neighborhoods and our online division, consisting of<br>iGObanking® and BankPurely®<br>1 See Reconciliation of GAAP to Core Earnings in Appendix<br>2 See Reconciliation of GAAP to Core Net Interest Income and NIM in Appendix 4<br>Brand Promise<br>Nurturing Relationships and Rewarding Customers,<br>Employees, and Shareholders<br>Valuation<br>Closing Price, 10/28/24 $16.17<br>Market Cap (MM) $470<br>Price/TBV 73%<br>Dividend Yield 5.4% |
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| 5<br>▪ Increase NIM and Reduce Volatility<br>– Loan and CD repricing to help NIM over time<br>– Focusing on noninterest bearing deposits<br>▪ Maintain Credit Discipline<br>– Low risk profile<br>– Conservative loan underwriting<br>– History of low credit losses<br>– Minimal exposure to Manhattan office buildings<br>▪ Preserve Strong Liquidity and Capital<br>– Low uninsured and uncollateralized deposits with high available liquidity<br>– Favorable capital ratios<br>▪ Bend the Expense Curve<br>– Keep expense growth in line with historical norms<br>– Continue to make investments to improve long term profitability<br>Areas of Focus<br>These Actions are Expected to Improve Profitability Over the Long Term |
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| Strong Asian Banking Market Focus<br>17%<br>of Total Deposits<br>$40B<br>Deposit Market Potential<br>(~3% Market Share1<br>)<br>5.8%<br>1 Year Growth in 2024 vs<br>(1.5)%1<br>for the<br>Comparable Asian<br>Markets<br>Asian Communities – Total Loans $744 million<br>and Deposits $1.3 billion<br>Multilingual Branch Staff Serves Diverse Customer Base in NYC<br>Metro Area<br>Growth Aided by the Asian Advisory Board<br>Sponsorships of Cultural Activities Support New and Existing<br>Opportunities<br>1 As of June 30, 2024; Latest FDIC Data<br>About One Third of Branches are in Asian markets<br>6 |
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| Loans Secured by Real Estate Have an Average LTV of ~36%<br>Manhattan Office Buildings are Approximately 0.5% of Gross Loans<br>Data as of September 30, 2024<br>39%<br>10% 11%<br>7 %<br>6 %<br>5 %<br>4 %<br>4 %<br>4 %<br>2 %2 % 2 % 1 %<br>1 %<br>1 %1 % Multifamily: 39.0%<br>Owner Occupied CRE: 11.0%<br>Non Real Estate: 10.0%<br>One-to-four family - Mixed Use: 7.0%<br>General Commercial: 6.0%<br>CRE - Shopping Center: 5.0%<br>CRE - Strip Mall: 4.0%<br>One-to-four family - Residential: 4.0%<br>Commercial Mixed Use: 4.0%<br>CRE - Single Tenant: 2.0%<br>Industrial: 2.0%<br>Office - Multi & SingleTenant: 2.0%<br>Health Care/Medical Use: 1.0%<br>Commercial Special Use: 1.0%<br>Construction: 1.0%<br>Office Condo & Co-Op: 1.0%<br>$6.8B<br>Total Portfolio<br>90% Real Estate Based<br>7 |
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| -0.50%<br>0.00%<br>0.50%<br>1.00%<br>1.50%<br>2.00%<br>2.50%<br>3.00%<br>2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 9M24<br>FFIC Industry<br>0.00%<br>1.00%<br>2.00%<br>3.00%<br>4.00%<br>5.00%<br>6.00%<br>0.00%<br>20. 0%<br>40. 0%<br>60. 0%<br>80. 0%<br>10.00%<br>120.00%<br>2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 9M24<br>FFIC Industry<br>▪ Over two decades and multiple credit cycles, Flushing<br>Financial has a history of better than industry credit quality<br>▪ Average LTVs on the Real Estate portfolio is less than 36%4<br>– Only $31.7 million of real estate loans (0.5% of gross loans) with an<br>LTV of 75% or more4<br>; $9.1 million have mortgage insurance<br>Net Charge-offs Significantly Better Than the Industry; Strong DCR<br>NCOs / Average Loans1<br>1<br>“Industry” includes FDIC insured institutions from “FDIC Statistics At A Glance”<br>through June 30, 2024<br>2 Based on most recent Annual Loan Review<br>3 Based upon a sample size of 74% of multifamily and investor real estate loans as of December 31, 2023<br>4 Based on appraised value at origination 8<br>Noncurrent Loans / Loans<br>Weighted average debt coverage ratios (DCR) for<br>Multifamily and Investor CRE portfolios at ~1.87x2<br>- 200 bps shock increase in rates produces a weighted average DCR of ~1.46x3<br>- 10% increase in operating expense yields a weighted average DCR of ~1.74x3<br>- 200 bps shock increase in rates and 10% increase in operating expenses results in a<br>weighted average DCR ~1.313<br>- In all scenarios, weighted average CLTV is less than 50%3,4 |
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| 0.45%<br>0.54% 0.53%<br>0.61% 0.59%<br>0.40% 0.39% 0.42%<br>0.50%<br>0.00%<br>0.10%<br>0.20%<br>0.30%<br>0.40%<br>0.50%<br>0.60%<br>0.70%<br>0.80%<br>0.90%<br>1.00%<br>3Q23 4Q23 1Q24 2Q24 3Q24<br>FFIC Peer Median*<br>9<br>Low Risk Credit Profile Results<br>NPAs / Assets Criticized and Classified Loans / Gross Loans<br>30-89 Day Past Due /Total Loans ACL by Loan Segment (3Q24)<br>$2,639<br>$1,929<br>$516<br>$253 $64 $19<br>$1,388<br>0.43% 0.47% 0.30% 0.32% 1.00%<br>7.38%<br>1.12%<br>-7 0. 00%<br>-6 0. 00%<br>-5 0. 00%<br>-4 0. 00%<br>-3 0. 00%<br>-2 0. 00%<br>-1 0. 00%<br>0. 00 %<br>10 .0 0%<br>Multifamily<br>Residential<br>Commercial Real<br>Estate<br>1-4 Family - Mixed<br>Use<br>1-4 Family -<br>Residential<br>Construction Small Business<br>Administration<br>Commercial<br>Business and<br>Other Loan Balance ($MM) ACLs / Loans<br>55% LTV on 3Q24 NPAs<br>Peer data through 2Q24; Peers include: BKU, DCOM, FLIC, HNVR, KRNY, NFBK, NYCB, PFS, and VLY<br>1.08% 1.11% 0.87% 1.13% 1.00%<br>1.72%<br>2.28%<br>3.57%<br>2.62%<br>0.00%<br>0.50%<br>1.00%<br>1.50%<br>2.00%<br>2.50%<br>3.00%<br>3.50%<br>4.00%<br>4.50%<br>5.00%<br>3Q23 4Q23 1Q24 2Q24 3Q24<br>FFIC Peer Median*<br>0.13%<br>0.25% 0.25%<br>0.35%<br>0.43%<br>0.26% 0.26%<br>0.31%<br>0.33%<br>-0.05%<br>0.05%<br>0.15%<br>0.25%<br>0.35%<br>0.45%<br>0.55%<br>0.65%<br>0.75%<br>3Q23 4Q23 1Q24 2Q24 3Q24<br>30-89 Day Past Due/Total Loans Peer Median* |
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| 10<br>Strong Credit Quality In Key Portfolios<br>Portfolio Data Points Multifamily Investor CRE1 Office CRE<br>NPLs/Loans 33 bps 0 bps 274 bps<br>Criticized and Classified<br>Loans/Loans 55 bps 0 bps 274 bps<br>Weighted Average DCR2<br>: 1.9x 1.9x 1.9x<br>Portfolio Size: $2.6 billion $1.7 billion $244.7 million<br>Average Loan Size: $1.2 million $2.5 million $3.0 million<br>1 Excludes Office CRE portfolio<br>2 Based on most recent Annual Loan Review |
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| 11<br>Low Risk Multifamily Loan Portfolio<br>• We employ a model to determine loan risk<br>ratings for real estate loans<br>• The model consists of four factors: property<br>condition, current DCR, current LTV, and loan<br>payment history with DCR and LTV combining<br>for 70% of the weight<br>• The model output cannot be overridden to<br>improve the risk rating<br>1 Chart data as of June 30, 2024; Peers include: BKU, DCOM, FLIC, HNVR, KRNY, NFBK, NYCB, PFS, and VLY<br>2 As of September 30, 2024<br>Loan Rating Criteria<br>• 30-89 days past due are 0.52% of total<br>multifamily loans<br>• NPL loans are 0.33% of total multifamily loans<br>• Criticized and Classified loans to multifamily<br>loans are 0.55%<br>• LLRs to multifamily criticized and classified<br>loans are 71%<br>Multifamily Credit Quality Statistics2<br>0.67%<br>11.98%<br>4.23%<br>0.14% 0.60% 1.68%<br>0.38%<br>23.75%<br>0.86%<br>8.84%<br>FFIC Peer 1 Peer 2 Peer 3 Peer 4 Peer 5 Peer 6 Peer 7 Peer 8 Peer 9<br>Criticized and Classified Multifamily Loans /<br>Total Multifamily Loans<br>4th<br>Lowest<br>61%<br>10% 7%<br>665%<br>126%<br>54%<br>143%<br>7%<br>117%<br>12%<br>FFIC Peer 1 Peer 2 Peer 3 Peer 4 Peer 5 Peer 6 Peer 7 Peer 8 Peer 9<br>Multifamily Allowance for Credit Losses /<br>Criticized and Classified Multifamily Loans<br>5th<br>Highest<br>Multifamily Ratios vs Peer Banks1 |
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| GAAP and Core NIM Near Stabilization<br>12<br>GAAP NIM FTE<br>2.22% 2.29% 2.06% 2.05% 2.10%<br>See Appendix for definitions of Core NII FTE, Core NIM, and Core Loan Yields<br>Net Interest Income and NIM<br>($ Millions)<br>$42.8<br>$46.6<br>$42.4 $42.5<br>$45.0<br>2.13% 2.31% 2.06% 2.03% 2.07%<br>5.26%<br>5.59% 5.45% 5.47% 5.65%<br>2.94% 3.10% 3.27% 3.39% 3.55%<br>0.00%<br>1.00%<br>2.00%<br>3.00%<br>4.00%<br>5.00%<br>6.00%<br>7.00%<br>8.00%<br>9.00%<br>10.00%<br>$10. 0<br>$15. 0<br>$20. 0<br>$25. 0<br>$30. 0<br>$35. 0<br>$40. 0<br>$45. 0<br>$50. 0<br>3Q23 4Q23 1Q24 2Q24 3Q24<br>Core NII FTE Core NIM FTE Core Loan Yields Core Deposit Yield<br>▪ The 50 bps cut by the Fed should help NIM over<br>time; timing of the benefit will largely depend on<br>market deposit pricing<br>▪ If the inversion in the yield curve (primarily<br>Overnight/3- month SOFR relative to the 5- year<br>FHLB-NY Advance rate) lessens, this should<br>improve spreads on the real estate portfolio<br>over time<br>▪ On October 1, 2024, rates on $1.8 B out of<br>$3.7 B of non-maturity deposits were lowered<br>by 50 bps<br>▪ After a lag, NIM improvement is expected to<br>occur over time and be bumpy rather than<br>linear; a flattening of the curve will help, and<br>a steepening will have a greater positive<br>impact |
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| ▪ Floating rate loans include any loans (including back-to-back swaps) tied to an index that reprices within 90 days;<br>Including interest rate hedges of $500 million, $1.8 billion or ~26% of the loan portfolio is effectively floating rate<br>▪ Through 2026, loans to reprice ~159-199 bps higher assuming index values as of September 30, 2024<br>▪ ~19% of loans reprice (~26% including all loan portfolio hedges) with every Fed move and an additional 11-15% reprice<br>annually<br>$1,264<br>$226<br>7.27% $777 $730<br>4.36%<br>4.33% 4.04%<br>7.05%<br>6.21% 5.92% 6.03%<br> -<br> 200<br> 400<br> 600<br> 800<br> 1,0 00<br> 1,2 00<br> 1,4 00<br>Floating Remainder of 2024 2025 2026<br>Adjustable Loan Repricing Maturing Fixed Rate Total Loan Repricing Current Rate Repricing Rate<br>Effective Floating Rate Loans are ~26% of the Loan Portfolio;<br>Significant Repricing to Occur Through 2026<br>13<br>Loan Repricing<br>($ Millions)<br>+185 bps +159 bps +199 bps |
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| $851.7 $873.3 $834.2 $822.9 $845.5<br>-100<br>10<br>30<br>50<br>70<br>90<br>1100<br>1300<br>3Q23 4Q23 1Q24 2Q24 3Q24<br>12.5% 12.7% 11.8% 11.4% 11.3%<br>28.0% 26.8% 27.3% 28.0% 25.3%<br>1.7% 1.6% 1.5% 1.4% 1.4%<br>23.2% 23.6% 24.4% 23.8% 22.4%<br>33.6% 34.0%<br>34.0% 33.9% 38.6%<br>1.0% 1.3% 1.0% 1.3%<br>1.0% $6,819 $6,884 $7,081 $7,196<br>$7,464<br>0<br>100 0<br>200 0<br>300 0<br>400 0<br>500 0<br>600 0<br>700 0<br>800 0<br>3Q23 4Q23 1Q24 2Q24 3Q24<br>Noninterest Bearing NOW Accounts Savings<br>Money Market CDs Mortgage Escrow<br>Average Total Deposits Expand YoY and QoQ<br>14<br>Total Average Deposits<br>($ Millions)<br>▪ Average total deposits increased 9.5% YoY<br>and 3.7% QoQ with QoQ growth in CDs and<br>noninterest bearing deposits more than offset<br>seasonal declines<br>▪ Average noninterest bearing deposits are<br>11.3% of average total deposits, down from<br>12.5% a year ago<br>▪ 3Q24 checking account openings increased<br>3% YOY and 24% QoQ<br>Average Noninterest Bearing Deposits<br>($ Millions)<br>Deposit Costs<br>2.94% 3.10% 3.27% 3.38% 3.55% |
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| 15<br>CDs Expected to Reprice Favorably<br>▪ CDs have a weighted average rate of<br>4.64%1 as of September 30, 2024<br>▪ Current CD APYs are approximately<br>3.75-4.75%<br>▪ Approximately 72%1 of the CD portfolio<br>will mature within one year<br>– $647.2 million in 4Q24 at 4.96%1<br>– $420.8 million in 1Q25 at 4.70%<br>– $164.6 million in 2Q25 at 4.06%<br>– $251.0 million in 3Q25 at 4.17%<br>▪ Historically, we retain a high percentage<br>of maturing CDs<br>Total CDs of $2.9 Billion;<br>Repricing Dates with Weighted Average Rate1<br>1 Excludes $801MM of CDs with interest rate hedges<br>4.96%<br>4.70%<br>4.06%<br>4.17%<br>4Q24 1Q25 2Q25 3Q25 |
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| 16<br>Net Interest Margin to Improve Over Time<br>▪ Short-term NIM improvement driven by:<br>– Significant CD repricing at lower roll over rates (likely 50-100 bps in 4Q24)<br>– Meaningful real estate loan repricing 150-200 bps higher over the next couple of years<br>– Approximately 50% of the non-maturity deposits had rates lowered by 50 bps on<br>October 1st<br>– Floating rate assets and swaps will serve as a potential offset to the funding reductions<br>▪ Long-term NIM improvement driven by:<br>– Flattening to positive sloped yield curve<br>• Our interest rate risk modeling shows a 200 bps steepening of the yield curve (September<br>30, 2024 base) shows net interest income increasing by approximate $4 million in the first<br>year and $20 million in the second year<br>– Continued remixing of earning assets and funding<br>Net Interest Margin to Improve Over Time But the Trend Could be Bumpy |
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| $22.39 $22.54 $22.39 $22.24 $22.29<br>7.56% 7.64% 7.40% 7.12% 7.00%<br>0.00%<br>2.00%<br>4.00%<br>6.00%<br>8.00%<br>10. 00%<br>12. 00%<br>14. 00%<br>16. 00%<br>18. 00%<br>20. 00%<br> $17.00<br> $18.00<br> $19.00<br> $20.00<br> $21.00<br> $22.00<br> $23.00<br> $24.00<br>3Q23 4Q23 1Q24 2Q24 3Q24<br>Tangible Book Value Per Share<br>Tangible Common Equity/Tangible Assets<br>$23.06 $23.21 $23.04 $22.89 $22.94<br>10.14% 10.25% 10.32% 10.22% 10.16%<br>8.51% 8.47% 8.32% 8.18% 7.91%<br>0.00%<br>5.00%<br>10. 00%<br>15. 00%<br>20. 00%<br>25. 00%<br>30. 00%<br> $17.00<br> $18.00<br> $19.00<br> $20.00<br> $21.00<br> $22.00<br> $23.00<br> $24.00<br>3Q23 4Q23 1Q24 2Q24 3Q24<br>Book Value Per Share CET1 Ratio Leverage Ratio<br>Slight Increase in Book Value and Tangible Book Value Per Share QoQ<br>17<br>0.5% YoY Book Value Per Share Decline 0.4% YoY Decrease in Tangible Book Value Per Share |
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| ▪ Balance Sheet<br>– Expect stable loans<br>– Focused on improving funding mix; expect normal<br>historical funding patterns<br>▪ Net Interest Income<br>– NIM outlook is largely dependent on deposit rate<br>competition<br>• If the market moves rates inline with rate cuts, our<br>NIM should be relatively stable to slightly positive<br>• If the market lags rate cuts, our NIM could have<br>some near-term pressure before expanding over the<br>longer term<br>– $1.5 billion of retail CDs to mature over the next<br>year at a weighted average rate of 4.65%; closer<br>to market rates; $647 million in 4Q24 at 4.96%<br>– $226 million of loans scheduled to reprice<br>upwards 185 bps in 4Q24 and $777 million, up<br>159 bps in 2025 (based on September 30, 2024<br>index values)<br>18<br>Outlook<br>▪ Noninterest Income<br>– Approximately $60 million of back-to-back swaps<br>in the loan pipeline; banking services fee income<br>to benefit in the quarter as these loans close<br>– In the process of completing a 1035 BOLI<br>exchange; BOLI income is estimated to be $2.1<br>million in 4Q24, $1.4 million in 1Q25, $3.3 million<br>in 2Q25, and $2.2 million in 3Q25 (and thereafter);<br>estimates could change based on timing of<br>settlements<br>▪ Noninterest Expense<br>– 2024 core noninterest expense expected to<br>increase mid single digits from the 2023 base of<br>$151.4 million as we continue to make<br>investments in the business to improve long term<br>profitability<br>▪ Effective Tax Rate<br>– Expecting mid 20s% for 2024 |
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| Appendix<br>19 |
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| ▪ Net interest recoveries on nonaccrual and<br>delinquent loans added 5 bps to the<br>3Q24 NIM (~$0.03 per share); NIM<br>bottomed in July before expanding in<br>August and September<br>▪ Noninterest income includes back-to-back swap fee income of $0.6 million in<br>3Q24, $0.5 million in 2Q24, and $1.6<br>million in 3Q23<br>▪ Noninterest expense increased 6.3%<br>YoY; still expect core noninterest<br>expense growth of mid single digits in<br>2024<br>▪ Credit quality remains solid; NCOs<br>primarily reflect a loan that was fully<br>reserved<br>▪ 3Q24 GAAP and Core EPS include $0.05<br>per share of insurance recoveries,<br>discrete income tax items, and other<br>events that are not expected to repeat<br>20<br>3Q24 Financial Highlights<br>1 See Reconciliation of GAAP Earnings to Core Earnings – Quarters<br>($ in 000s, except for EPS)<br>3Q24 2Q24 3Q23<br>Net Interest Income $45,603 $42,776 $44,427<br>Provision for Credit Losses 1,727 809 596<br>Noninterest Income 6,277 4,216 3,309<br>Noninterest Expense 38,696 39,047 36,388<br>Income Before Income Taxes 11,457 7,136 10,752<br>Provision for Income Taxes 2,551 1,814 2,917<br>Net Income $8,906 $5,322 $7,835<br>GAAP EPS $0.30 $0.18 $0.26<br>Core EPS1<br>$0.26 $0.18 $0.25<br>GAAP NIM FTE 2.10 % 2.05 % 2.22 %<br>Core NIM FTE1<br> 2.07 2.03 % 2.13<br>NCOs/Average Loans 0.18 % (0.01) % - %<br>NPAs/Assets 0.59 0.61 0.45<br>Criticized and Classified Loan/Loans 1.00 1.13 1.08<br>30-89 Day Past Due/Total Loans 0.43 0.35 0.13 |
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| 21<br>Swap Maturities: >50% of Interest Rate Hedges Mature through 2026<br>Swap<br>Type<br>Notional<br>($ Million)<br>2025<br>Maturities<br>($ Million)<br>2026<br>Maturities<br>($ Million)<br>2027<br>Maturities<br>($ Million)<br>Annualized<br>Net Interest<br>Income1<br>($ Million)<br>Investments $200.0 $0 $50 $75 $3.8<br>Loans2 $697.4 $140.9 $315.8 $115.0 $13.5<br>Funding $875.8 $225.0 $180.0 $50.0 $25.5<br>▪ The $1.8 billion of total interest rate hedges has annualized net interest income of<br>$42.8 million as of September 30, 2024<br>▪ The net benefit will expand if the Fed raises rates or compress if the Fed cuts<br>rates<br>▪ Approximately 21% of the interest rate hedges will mature in 2025 and 31% in 2026<br>1 As of September 30, 2024<br>2 Does not include $860.3 million of customer back-to-back loan swaps or $75 million of forward funding swaps |
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| Reported Results<br>EPS $0.96 $2.50 $2.59 $1.18 $1.44 $1.92<br>ROAA 0.34 % 0.93 % 1.00 % 0.48 % 0.59 % 0.85 %<br>ROAE 4.25 11.44 12.60 5.98 7.35 10.30<br>NIM FTE 2.24 3.11 3.24 2.85 2.47 2.70<br>Core1<br> Results<br>EPS $0.83 $2.49 $2.81 $1.70 $1.65 $1.94<br>ROAA 0.29 % 0.92 % 1.09 % 0.68 % 0.68 % 0.85 %<br>ROAE 3.69 11.42 13.68 8.58 8.42 10.39<br>NIM FTE 2.21 3.07 3.17 2.87 2.49 2.72<br>Credit Quality<br>NPAs/Loans & REO 0.67 % 0.77 % 0.23 % 0.31 % 0.24 % 0.29 %<br>LLRs/Loans 0.58 0.58 0.56 0.67 0.38 0.38<br>LLR/NPLs 159.55 124.89 248.66 214.27 164.05 128.87<br>NCOs/Average Loans 0.16 0.02 0.05 0.06 0.04 -<br>Criticized & Classifieds/Loans 1.11 0.98 0.87 1.07 0.66 0.96<br>Capital Ratios<br>CET1 10.25 % 10.52 % 10.86 % 9.88 % 10.95 % 10.98 %<br>Tier 1 10.93 11.25 11.75 10.54 11.77 11.79<br>Total Risk-based Capital 14.33 14.69 14.32 12.63 13.62 13.72<br>Leverage Ratio 8.47 8.61 8.98 8.38 8.73 8.74<br>TCE/TA 7.64 7.82 8.22 7.52 8.05 7.83<br>Balance Sheet<br>Book Value/Share $23.21 $22.97 $22.26 $20.11 $20.59 $19.64<br>Tangible Book Value/Share 22.54 22.31 21.61 19.45 20.02 19.07<br>Dividends/Share 0.88 0.88 0.84 0.84 0.84 0.80<br>Average Assets ($B) 8.5 8.3 8.1 7.3 6.9 6.5<br>Average Loans ($B) 6.8 6.7 6.6 6.0 5.6 5.3<br>Average Deposits ($B) 6.9 6.5 6.4 5.2 5.0 4.7<br>2023 2022 2021 2020 2019 2018<br>22<br>Annual Financial Highlights<br>1 See Reconciliation of GAAP Earnings and Core Earnings in Appendix |
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| Digital Banking Usage Continues to Increase<br>23<br>Technology Enhancements Remain a Priority to Grow Customer Base and Increase Engagement<br>17%<br>Increase in Monthly Mobile<br>Deposit Active Users<br>September 2024<br>YoY Growth<br>~32,000<br>Users with Active Online<br>Banking Status<br>September 2024<br>16%<br>Digital Banking<br>Enrollment<br>September 2024<br>YoY Growth<br>Numerated<br>Small Business Lending<br>Platform<br>$8.5MM of Commitments<br>year to date in 2024<br>Internet Banks<br>iGObanking and BankPurely<br>national deposit gathering<br>platforms<br>~2% of Average Deposits<br>in September 2024<br>~13,000<br>Zelle® Transactions<br>~$4.4MM<br>Zelle Dollar Transactions<br>in September 2024 |
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| Over a 28 Year Track Record of Steady Growth<br>Core EPS ($) Dividends per Share ($) 2 Tangible Book Value per Share ($)<br>Assets ($B) Total Gross Loans ($B) Total Deposits ($B)<br>$-<br>$0.88<br>1995 2000 2005 2010 2015 2020 2023 3Q24<br>$-<br>$0.59<br>1995 2000 2005 2010 2015 2020 2023 3Q24<br>$0.6<br>$7.6<br>1995 2000 2005 2010 2015 2020 2023 3Q24<br>$0.3<br>$6.8<br>1995 2000 2005 2010 2015 2020 2023 3Q24<br>$0.7<br>$9.3<br>1995 2000 2005 2010 2015 2020 2023 3Q24<br>9% CAGR 11% CAGR 9% CAGR<br>4% CAGR1 14% CAGR1<br>$4.86<br>$22.29<br>1995 2000 2005 2010 2015 2020 2023 3Q24<br>5% CAGR<br>Note: Acquisition of Empire Bancorp in 2020 (loans and deposits acquired of $685MM and $854MM, respectively; assets acquired of $982MM) 24<br>1 Calculated from 1996-2023<br>2 Annualized |
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| Approach to Real Estate Lending: Low Leverage & Shared Philosophy<br>25<br>Our Conservative Lending Profile Has Served Us Well Over Many Cycles<br>▪ Since 1929, we have a long history of lending in metro New York City<br>– Historically, credit quality has outperformed the industry and peers<br>• From 2001-2023, median NCOs to average loans has been 4 bps compared to 52 bps for the<br>industry<br>• Median noncurrent loans to total loans has been 37 bps compared to 130 bps for the industry<br>over the same period<br>▪ The key to our success is shared client philosophy<br>– Our clients tend to have low leverage (average LTV is <36%) and strong cash flows (DCR is 1.9x<br>for multifamily and CRE1<br>)<br>– Multigenerational– our clients tend to build portfolio of properties; generally, buy and hold<br>– Borrowers are not transaction oriented – average real estate loan seasoning is over 8 years,<br>which is generally passed the 5-year reset for multifamily and investor CRE loans<br>– We do not attract clients who are short term borrowers, who want funds on future cash flows, or<br>who are aggressively trying to convert rent regulated units into market rents<br>1 Based on annual loan reviews |
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| ▪ All loans underwritten with a 250-300 bps<br>increase in rates at origination; especially when<br>rates were low<br>▪ Debt coverage ratios (DCR) based on current<br>rents; not projected cash flows<br>▪ Underwritten Net Operating Income (NOI) at<br>origination includes forecasted increases in<br>expenses and potential increase in interest rates,<br>which limits overall leverage<br>▪ Cap rates were underwritten to 5%+ when rates<br>were low<br>▪ Annual loan reviews performed; cash flows<br>updated annually and a trend analysis on the<br>portfolio is performed<br>▪ 30-year amortization<br>▪ Loans generally reset every 5 years (FHLB<br>Advance rate + 225 bps)<br>26<br>Multifamily: Conservative Underwriting Standards<br>Portfolio Data Points<br>Portfolio Size: $2.6 billion<br>Average Loan Size: $1.2 million<br>Current Weighted Average Coupon: 5.03%<br>Weighted Average LTV: 44%<br>% of Loans with LTV >75% 0.1%<br>Weighted Average DCR: 1.9x<br>NPLs/Loans 0.33%<br>30-89 Days Past Due/Loans 0.56%<br>Criticized and Classified Loans/Loans 55 bps<br>Underwriting Standards at Origination<br>Data as of September 30, 2024 |
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| Actual Repricing<br>27<br>Multifamily: Manageable Repricing Risk<br>▪ During 2023, $296 million of loans repriced<br>~196 bps higher to 6.61%; all loans repriced<br>to contractual rate<br>▪ For 4Q24, $95.7 million of loans are<br>forecasted to reprice 197 bps higher to a<br>weighted average rate of 6.14%1<br>▪ For 2025, $358.3 million of loans are<br>forecasted to reprice 208 bps higher to a<br>weighted average rate of 6.14%1<br>▪ Example of a typical 2023 loan repricing:<br>– Income and expense increased at an<br>approximate 4% CAGR<br>– Rate resets to FHLB 5-yr advance + 225 bps<br>– NOI sensitivity provided for illustrative<br>purposes only; actual expense CAGR has<br>been 4%<br>1 Based on underlying index value on September 30, 2024<br>Key Data Points<br>At Origination At Reprice Date<br>($000s) 2019 Stressed CAGR 2023<br>Purchase Price: $7,500 $7,500<br>Loan Amount: $4,250 $3,824 $3,824<br>LTV: 56.7% 51.0%<br>Rate: 3.75% 5.75% 6.45%<br>Annual Payment: $159 $301 $324<br>Income: 725 848 4% 848<br>Expense: 362 423 4% 423<br>NOI: $363 $425 $425<br>DCR: 2.28 1.41 1.31<br>NOI Sensitivity<br>CAGR 2023 CAGR 2023<br>Loan Balance: $3,824 $3,824<br>Repricing Rate: 6.45% 6.45%<br>Annual Payment: $324 $324<br>Income: 4% 848 4% 848<br>Expense: 6% 458 8% 492<br>NOI: $390 $356<br>DCR: 1.20 1.10 |
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| Debt Coverage Ratio Details1<br>Multifamily weighted<br>average DCR 1.9x2<br>Amount of loans with<br>a DCR of 1.0-1.2x $132.9 million3<br>LTV of loans with a<br>DCR of 1.0-1.2x 48%<br>Amount of loans with<br>a DCR <1.0x $25.6 million3<br>LTV of loans with a<br>DCR <1.0x 31%<br>Of the loans with a<br>DCR <1.2x:<br>• None have an LTV >70%<br>• $16.1 million have an LTV<br>>60%<br>• $1.4 million are 90+ days<br>past due; $2.4 million<br>criticized or classified (with<br>WA LTV of 49.7%)<br>28<br>Multifamily: DCR Risks Are Well Contained<br>1 Data as of September 30, 2024<br>2 Based on annual loan reviews<br>3 Excludes co-ops<br>▪ Underwriting assumes higher rates at<br>origination leading to strong DCRs<br>▪ Low amount of loans with DCRs less than<br>1.2x and minimal amount below 1.0x<br>▪ Borrowers have significant equity positions<br>in these loans, especially for those with<br>DCRs less than 1.0x<br>▪ Credit performance is favorable for DCRs<br>of 1.2x or less:<br>– $1.4 million 90+ days past due<br>– Only $2.4 million of criticized or classified<br>loans with a weighted average LTV of<br>49.7%<br>Key Data Points1 |
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| 29<br>Multifamily: Minimal Interest Only; High Quality Performance<br>1 As of June 30, 2024<br>2 Excludes co-ops<br>▪ Interest only loans are typically only offered<br>to relationship customers who have a prior<br>history with the Bank<br>▪ A client requests an interest only loan when<br>cash flows early in the project are low and<br>will increase after improvements occur or if<br>the cash flow is strong enough to cover the<br>required debt service amortizing yet a<br>preferred return for a limited time frame is<br>desired<br>▪ Significant equity or multiple properties are<br>offsetting factors<br>▪ Loans are generally interest only for 1-3<br>years and then become fully amortizing<br>▪ Underwritten on a fully amortizing basis<br>▪ Credit performance is stellar with only one<br>loan for $5 million that is criticized and<br>classified<br>Interest Only Loan Details Key Data Points 1<br>Total interest only loans $214.4 million<br>(down 18% year to date)<br>Weighted average LTV 46%<br>Weighted average DCR 2.3x2<br>Amount of loans with a<br>DCR <1.2x $02<br>30-89 Days Past<br>Due/Loans $0<br>Criticized and Classified<br>Loans/Loans $5 million<br>Amount of loans to<br>become fully amortizing in<br>2024<br>• $86.2 million<br>• 2.9x current DCR and<br>~1.9x when fully<br>amortized |
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| Key Data Points<br>30<br>Multifamily: Rent Regulated Portfolio – Granular and Low Risk<br>Portfolio Data Points1<br>Portfolio Size: $1.6 billion<br>Average Loan Size: $1.4 million<br>Current Weighted Average Coupon: 4.82%<br>Weighted Average LTV: 48%<br>% of Loans with LTV >75% 0.2%<br>Weighted Average DCR: 1.8x2<br>Average Seasoning: 7.6 years<br>30-89 Days Past Due $5.5 million<br>Criticized and Classified Loans $7.5 million<br>Buildings that are 100% rent regulated $778 million<br>Buildings that are 50-99% rent regulated $525 million<br>Buildings that are <50% rent regulated $290 million<br>▪ New York City area has a shortage of<br>affordable housing creating the need for rent<br>regulated units; annual the Rent Guidelines<br>Board establishes rental increases for these<br>units<br>▪ Loans that contain rent regulated properties<br>are about two thirds of the multifamily<br>portfolio<br>▪ This portfolio is very granular with about half<br>the portfolio in buildings that are 100% rent<br>regulated and half with a mix of market rents<br>▪ Borrowers have over 50% equity in these<br>properties<br>▪ With average seasoning over 7 years, these<br>borrowers have experienced rate resets<br>▪ Credit performance is solid with low levels of<br>delinquencies, criticized, and classified loans<br>1 Data as of June 30, 2024<br>2 Based on annual loan reviews |
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| ▪ All loans underwritten with a 250-300 bps<br>increase in rates at origination; especially when<br>rates were low<br>▪ Debt coverage ratios (DCR) based on current<br>rents; not projected cash flows<br>▪ Underwritten Net Operating Income (NOI) at<br>origination includes forecasted increases in<br>expenses and potential increase interest rates,<br>which limits overall leverage<br>▪ Cap rates were underwritten to 5%+ when rates<br>were low<br>▪ Annual loan reviews performed; cash flows<br>updated annually and a trend analysis on the<br>portfolio is performed<br>▪ 30-year amortization<br>▪ Loans generally reset every 5 years<br>(FHLB Advance rate + 225 bps)<br>31<br>Investor CRE: Conservative Underwriting Standards<br>Portfolio Data Points<br>Portfolio Size: $1.9 billion<br>Average Loan Size: $2.5 million<br>Current Weighted Average Coupon: 5.16%<br>Weighted Average LTV: 49%<br>% of Loans with LTV >75% 44 bps<br>Weighted Average DCR: 1.9x<br>NPLs/Loans 35 bps<br>30-89 Days Past Due/Loans 0.01%<br>Criticized and Classified Loans/Loans 35 bps<br>Underwriting Standards at Origination<br>Data as of September 30, 2024 |
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| 16%<br>29%<br>21%<br>17%<br>17%<br>Bronx Kings Manhattan<br>Queens Other<br>10%<br>18%<br>17%<br>18%<br>5%<br>7%<br>8%<br>3%<br>14%<br>Bronx Kings Manhattan<br>Queens Other NY Nassau<br>Suffolk NJ CT/Other<br>Multifamily Geography<br>Geographically Diverse Multifamily and CRE Portfolios<br>32<br>Underwrite Real Estate Loans with a Cap Rates over 6.6% in 1H24 (5%+ Historically) and Stress Test Each Loan<br>$2.6B<br>Portfolio<br>Non-Owner Occupied CRE Geography<br>$1.9B<br>Portfolio |
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| 33<br>Well-Diversified Commercial Business Portfolio<br>Commercial Business<br>▪ Primarily in market lending<br>▪ Annual sales up to $250 million<br>▪ Lines of credit and term loans, including owner<br>occupied mortgages<br>▪ Loans secured by business assets, including<br>account receivables, inventory, equipment, and<br>real estate<br>▪ Personal guarantees are generally required<br>▪ Originations are generally $100,000 to $10<br>million<br>▪ Adjustable rate loans with adjustment periods<br>of five years for owner-occupied mortgages<br>and for lines of credit the adjustment period is<br>generally monthly<br>▪ Generally not subject to limitations on interest<br>rate increases but have interest rate floors<br>Average loan size of $1.4 million<br>Data as of September 30, 2024<br>11.7%<br>11.6%<br>9.5%<br>9.2%<br>6.7% 8.6%<br>6.3%<br>5.9%<br>5.7%<br>3.7%<br>3.5%<br>2.6%<br>2.6%<br>2.1%<br>2.1%1.7%1.7%<br>1.6%<br>1.6%<br>1.6%<br>Wholesalers: 11.7% Trucking/ Vehicle Transport: 11.6%<br>Other: 9.5% Financing Company: 9.2%<br>Construction / Contractors: 8.6% Professional Services (Excluding Medical): 6.7%<br>Hotels: 6.3% Medical Professionals: 5.9%<br>Manufacturer: 5.7% Automobile Related: 3.7%<br>Apparel: 3.5% Restaurants: 2.6%<br>Electrical Equipment: 2.6% Theaters: 2.1%<br>Civic and Social Organizations: 2.1% Food Service: 1.7%<br>Retailer: 1.7% Schools / Daycare Centers: 1.6%<br>Airlines: 1.6% Real Estate: 1.6%<br>$1.4B<br>Total Portfolio<br>Real Estate<br>Collateral<br>$728MM |
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| Reconciliation of GAAP Earnings and Core Earnings<br>34<br>Non-cash Fair Value Adjustments to GAAP Earnings<br>The variance in GAAP and core earnings is partly driven by the impact of non-cash net gains and losses from fair value<br>adjustments. These fair value adjustments relate primarily to borrowings carried at fair value under the fair value option.<br>Core Net Income, Core Diluted EPS, Core ROAE, Core ROAA, Pre-provision, Pre-tax Net Revenue, Core Net Interest Income<br>FTE, Core Net Interest Margin FTE, Core Interest Income and Yield on Total Loans, Core Noninterest Income, Core Noninterest<br>Expense and Tangible Book Value per common share are each non-GAAP measures used in this presentation. A reconciliation<br>to the most directly comparable GAAP financial measures appears below in tabular form. The Company believes that these<br>measures are useful for both investors and management to understand the effects of certain interest and noninterest items and<br>provide an alternative view of the Company's performance over time and in comparison, to the Company's competitors. These<br>measures should not be viewed as a substitute for net income. The Company believes that tangible book value per common<br>share is useful for both investors and management as this measure is commonly used by financial institutions, regulators and<br>investors to measure the capital adequacy of financial institutions. The Company believes this measure facilitates comparison of<br>the quality and composition of the Company's capital over time and in comparison, to its competitors. This measure should not<br>be viewed as a substitute for total shareholders' equity.<br>These non-GAAP measures have inherent limitations, are not required to be uniformly applied and are not audited. They should<br>not be considered in isolation or as a substitute for analysis of results reported under GAAP. These non-GAAP measures may<br>not be comparable to similarly titled measures reported by other companies. |
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| 35<br>1 Core diluted earnings per common share may not foot due to rounding<br>2 Ratios are calculated on an annualized basis<br>Reconciliation of GAAP to CORE Earnings - Quarters<br>(Dollars in thousands,<br>except per share data)<br>GAAP income before income taxes $ 11,457 $ 7,136 $ 4,997 $ 11,754 $ 10,752 $ 23,590 $ 28,079<br>Net (gain) loss from fair value adjustments<br>(Noninterest income (loss)) (974) (57) 834 (906) 1,246 (197) (1,667)<br>Life insurance proceeds (Noninterest income (loss)) (1) — — (697) (23) (1) (584)<br>Net (gain) loss from fair value adjustments on<br>qualifying hedges (Net interest income) (554) (177) 187 872 (1,348) (544) (1,243)<br>Net amortization of purchase accounting adjustments<br>and intangibles (Various) (62) (85) (169) (355) (237) (316) (652)<br>Miscellaneous expense (Professional services) 1 0 494 — 526 — 504 —<br>Core income before taxes 9,876 7,311 5,849 11,194 10,390 23,036 23,933<br>Provision for core income taxes 2,153 1,855 1,537 3,648 2,819 5,545 6,561<br>Core net income $ 7,723 $ 5,456 $ 4,312 $ 7,546 $ 7,571 $ 17,491 $ 17,372<br>GAAP diluted earnings per common share $ 0.30 $ 0.18 $ 0.12 $ 0.27 $ 0.26 $ 0.60 $ 0.69<br>Net (gain) loss from fair value adjustments, net of tax (0.03) (0.01) 0.02 (0.02) 0.03 (0.01) (0.04)<br>Life insurance proceeds — — — (0.02) — — (0.02)<br>Net (gain) loss from fair value adjustments on<br>qualifying hedges, net of tax (0.01) — — 0.02 (0.03) (0.01) (0.03)<br>Net amortization of purchase accounting adjustments,<br>net of tax — — — (0.01) (0.01) (0.01) (0.02)<br>Miscellaneous expense, net of tax — 0.01 — 0.01 — 0.01 —<br>Core diluted earnings per common share(1) $ 0.26 $ 0.18 $ 0.14 $ 0.25 $ 0.25 $ 0.59 $ 0.58<br>Core net income, as calculated above $ 7,723 $ 5,456 $ 4,312 $ 7,546 $ 7,571 $ 17,491 $ 17,372<br>Average assets 9,203,884 8,830,665 8,707,505 8,569,002 8,505,346 8,915,076 8,478,837<br>Average equity 672,762 667,557 669,185 669,819 675,041 669,845 676,949<br>Core return on average assets(2)<br> 0.34 % 0.25 % 0.20 % 0.35 % 0.36 % 0.26 % 0.27 %<br>Core return on average equity(2)<br> 4.59 % 3.27 % 2.58 % 4.51 % 4.49 % 3.48 % 3.42 %<br>For the three months ended For the nine months ended<br>September 3 0,<br>2024 2023<br>March 31, December 31, September 3 0,<br>2023 2023<br>September 3 0,<br>2024<br>September 3 0, June 30,<br>2024 2024 |
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| 36<br>Reconciliation of GAAP Revenue and<br>Pre-provision Pre-tax Net Revenue - Quarters<br>Efficiency ratio, a non-GAAP measure, was calculated by dividing core noninterest expense (excluding OREO expense and the net gain/loss from the sale of OREO) by the total of core net<br>interest income and core noninterest income.<br><br><br>(Dollars in thousands)<br>GAAP Net interest income $ 45,603 $ 42,776 $ 42,397 $ 46,085 $ 44,427 $ 130,776 $ 133,067<br>Net (gain) loss from fair value<br>adjustments on qualifying hedges (554) (177) 187 872 (1,348) (544) (1,243)<br>Net amortization of purchase<br>accounting adjustments (155) (182) (271) (461) (347) (608) (993)<br>Core Net interest income $ 44,894 $ 42,417 $ 42,313 $ 46,496 $ 42,732 $ 129,624 $ 130,831<br>GAAP Noninterest income $ 6,277 $ 4,216 $ 3,084 $ 7,402 $ 3,309 $ 13,577 $ 15,186<br>Net (gain) loss from fair value<br>adjustments (974) (57) 834 (906) 1,246 (197) (1,667)<br>Life insurance proceeds (1) — — (697) (23) (1) (584)<br>Core Noninterest income $ 5,302 $ 4,159 $ 3,918 $ 5,799 $ 4,532 $ 13,379 $ 12,935<br>GAAP Noninterest expense $ 38,696 $ 39,047 $ 39,892 $ 40,735 $ 36,388 $ 117,635 $ 110,654<br>Net amortization of purchase<br>accounting adjustments (93) (97) (102) (106) (110) (292) (341)<br>Miscellaneous expense (10) (494) — (526) — (504) —<br>Core Noninterest expense $ 38,593 $ 38,456 $ 39,790 $ 40,103 $ 36,278 $ 116,839 $ 110,313<br>Net interest income $ 45,603 $ 42,776 $ 42,397 $ 46,085 $ 44,427 $ 130,776 $ 133,067<br>Noninterest income 6,277 4,216 3,084 7,402 3,309 13,577 15,186<br>Noninterest expense (38,696) (39,047) (39,892) (40,735) (36,388) (117,635) (110,654)<br>Pre-provision pre-tax net revenue $ 13,184 $ 7,945 $ 5,589 $ 12,752 $ 11,348 $ 26,718 $ 37,599<br>Core:<br>Net interest income $ 44,894 $ 42,417 $ 42,313 $ 46,496 $ 42,732 $ 129,624 $ 130,831<br>Noninterest income 5,302 4,159 3,918 5,799 4,532 13,379 12,935<br>Noninterest expense (38,593) (38,456) (39,790) (40,103) (36,278) (116,839) (110,313)<br>Pre-provision pre-tax net revenue $ 11,603 $ 8,120 $ 6,441 $ 12,192 $ 10,986 $ 26,164 $ 33,453<br>Efficiency Ratio 77.2 % 82.6 % 86.1 % 76.7 % 76.8 % 81.8 % 76.7 %<br>For the nine months ended<br>September 30,<br>2024 2023<br>December 31, September 30,<br>2023<br>September 30,<br>2023<br>For the three months ended<br>September 30,<br>2024<br>June 30,<br>2024<br>March 31,<br>2024 |
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| 37<br>1 Excludes purchase accounting average balances for all periods presented<br>Reconciliation of GAAP to Core Net Interest Income and NIM - Quarters<br><br>(Dollars in thousands)<br>GAAP net interest income $ 45,603 $ 42,776 $ 42,397 $ 46,085 $ 44,427 $ 130,776 $ 133,067<br>Net (gain) loss from fair value adjustments<br>on qualifying hedges (554) (177) 187 872 (1,348) (544) (1,243)<br>Net amortization of purchase accounting<br>adjustments (155) (182) (271) (461) (347) (608) (993)<br>Tax equivalent adjustment 100 9 8 100 101 102 298 303<br>Core net interest income FTE $ 44,994 $ 42,515 $ 42,413 $ 46,597 $ 42,834 $ 129,922 $ 131,134<br>Prepayment penalties received on loans and<br>securities, net of reversals and recoveries of<br>interest from nonaccrual loans (1,647) (369) (928) (3,416) (857) (2,944) (1,852)<br>Net interest income FTE excluding episodic<br>items $ 43,347 $ 42,146 $ 41,485 $ 43,181 $ 41,977 $ 126,978 $ 129,282<br>Total average interest-earning assets (1) $ 8,712,443 $ 8,358,006 $ 8,238,395 $ 8,080,550 $ 8,027,201 $ 8,437,288 $ 8,010,154<br>Core net interest margin FTE 2.07 % 2.03 % 2.06 % 2.31 % 2.13 % 2.05 % 2.18 %<br>Net interest margin FTE excluding episodic<br>items 1.99 % 2.02 % 2.01 % 2.14 % 2.09 % 2.01 % 2.15 %<br>GAAP interest income on total loans, net $ 95,780 $ 92,728 $ 92,959 $ 95,616 $ 91,466 $ 281,467 $ 259,732<br>Net (gain) loss from fair value adjustments<br>on qualifying hedges - loans (364) (137) 123 978 (1,379) (378) (1,323)<br>Net amortization of purchase accounting<br>adjustments (168) (198) (295) (484) (358) (661) (1,019)<br>Core interest income on total loans, net $ 95,248 $ 92,393 $ 92,787 $ 96,110 $ 89,729 $ 280,428 $ 257,390<br>Average total loans, net (1) $ 6,740,579 $ 6,751,715 $ 6,807,944 $ 6,872,115 $ 6,817,642 $ 6,766,650 $ 6,842,712<br>Core yield on total loans 5.65 % 5.47 % 5.45 % 5.59 % 5.26 % 5.53 % 5.02 %<br>For the nine months ended<br>September 30, September 30,<br>2024 2024 2024 2023 2023 2024 2023<br>For the three months ended<br>September 30, June 30, March 31, December 31, September 30, |
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| 38<br>Calculation of Tangible Stockholders’ Common Equity to<br>Tangible Assets - Quarters<br><br>(Dollars in thousands)<br>Total Equity $ 666,891 $ 665,322 $ 669,827 $ 669,837 $ 666,521<br>Less:<br>Goodwill (17,636) (17,636) (17,636) (17,636) (17,636)<br>Core deposit intangibles (1,220) (1,322) (1,428) (1,537) (1,651)<br>Tangible Stockholders' Common<br>Equity $ 648,035 $ 646,364 $ 650,763 $ 650,664 $ 647,234<br>Total Assets $ 9,280,886 $ 9,097,240 $ 8,807,325 $ 8,537,236 $ 8,579,375<br>Less:<br>Goodwill (17,636) (17,636) (17,636) (17,636) (17,636)<br>Core deposit intangibles (1,220) (1,322) (1,428) (1,537) (1,651)<br>Tangible Assets $ 9,262,030 $ 9,078,282 $ 8,788,261 $ 8,518,063 $ 8,560,088<br>Tangible Stockholders' Common Equity to<br>Tangible Assets 7.00 % 7.12 % 7.40 % 7.64 % 7.56 %<br>2024<br>June 30,<br>2024<br>September 30,<br>2023<br>December 31, September 30,<br>2023<br>March 31,<br>2024 |
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| 39<br>Reconciliation of GAAP Earnings and Core Earnings - Years<br>1 Core diluted earnings per common share may not foot due to rounding<br>2 Ratios are calculated on an annualized basis<br> December 31, December 31, December 31, December 31,<br>(Dollars In thousands, except per share data) 2021 2020 2019 2018<br>GAAP income (loss) before income taxes $ 39,833 $ 104,852 $ 109,278 $ 45,182 $ 53,331 $ 65,485<br>Day 1, Provision for Credit Losses - Empire transaction — — — 1,818 — —<br>Net (gain) loss from fair value adjustments (2,573) (5,728) 12,995 2,142 5,353 4,122<br>Net (gain) loss on sale of securities — 10,948 (113) 701 15 1,920<br>Life insurance proceeds (1,281) (1,822) — (659) (462) (2,998)<br>Net gain on sale or disposition of assets — (104) (621) — (770) (1,141)<br>Net (gain) loss from fair value adjustments on qualifying hedges (371) (775) (2,079) 1,185 1,678 —<br>Accelerated employee benefits upon Officer's death — — — — 455 149<br>Prepayment penalty on borrowings — — — 7,834 — —<br>Net amortization of purchase accounting adjustments (1,007) (2,030) (2,489) 80 — —<br>Miscellaneous/Merger expense 526 — 2,562 6,894 1,590 —<br>Core income before taxes 35,127 105,341 119,533 65,177 61,190 67,537<br>Provision for core income taxes 10,209 28,502 30,769 15,428 13,957 11,960<br>Core net income $ 24,918 $ 76,839 $ 88,764 $ 49,749 $ 47,233 $ 55,577<br>GAAP diluted earnings (loss) per common share $ 0.96 $ 2.50 $ 2.59 $ 1.18 $ 1.44 $ 1.92<br>Day 1, Provision for Credit Losses - Empire transaction, net of tax — — — 0.05 — —<br>Net (gain) loss from fair value adjustments, net of tax (0.06) (0.14) 0.31 0.06 0.14 0.10<br>Net (gain) loss on sale of securities, net of tax — 0.26 — 0.02 — 0.05<br>Life insurance proceeds (0.04) (0.06) — (0.02) (0.02) (0.10)<br>Net gain on sale or disposition of assets, net of tax — — (0.01) — (0.02) (0.03)<br>Net (gain) loss from fair value adjustments on qualifying hedges, net of tax (0.01) (0.02) (0.05) 0.03 0.05 —<br>Accelerated employee benefits upon Officer's death, net of tax — — — — 0.01 —<br>Prepayment penalty on borrowings, net of tax — — — 0.20 — —<br>Net amortization of purchase accounting adjustments, net of tax (0.02) (0.05) (0.06) — — —<br>Miscellaneous/Merger expense, net of tax 0.01 — 0.06 0.18 0.04 —<br>NYS tax change — — (0.02) — — —<br>Core diluted earnings per common share(1) $ 0.83 $ 2.49 $ 2.81 $ 1.70 $ 1.65 $ 1.94<br>Core net income, as calculated above $ 24,918 $ 76,839 $ 88,764 $ 49,749 $ 47,233 $ 55,577<br>Average assets 8,501,564 8,307,137 8,143,372 7,276,022 6,947,881 6,504,598<br>Average equity 675,151 672,742 648,946 580,067 561,289 534,735<br>Core return on average assets(2)<br> 0.29 % 0.92 % 1.09 % 0.68 % 0.68 % 0.85 %<br>Core return on average equity(2)<br> 3.69 % 11.42 % 13.68 % 8.58 % 8.42 % 10.39 %<br>December 31,<br>2023<br>December 31,<br>2022<br>Years Ended |
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| 40<br>Reconciliation of GAAP Revenue and<br>Pre-Provision Pre-Tax Net Revenue - Years<br>Efficiency ratio, a non-GAAP measure, was calculated by dividing core noninterest expense (excluding OREO expense and the net gain/loss from the sale of OREO) by the total of core net<br>interest income and core noninterest income.<br><br>(Dollars In thousands)<br>GAAP Net interest income $ 179,152 $ 243,616 $ 247,969 $ 195,199 $ 161,940 $ 167,406<br>Net (gain) loss from fair value<br>adjustments on qualifying hedges (371) (775) (2,079) 1,185 1,678 —<br>Net amortization of purchase<br>accounting adjustments (1,454) (2,542) (3,049) (11) — —<br>Core Net interest income $ 177,327 $ 240,299 $ 242,841 $ 196,373 $ 163,618 $ 167,406<br>GAAP Noninterest income Net (gain) loss from fair value $ 22,588 $ 10,009 $ 3,687 $ 11,043 $ 9,471 $ 10,337<br>adjustments (2,573) (5,728) 12,995 2,142 5,353 4,122<br>Net (gain) loss on sale of securities — 10,948 (113) 701 1 5 1,920<br>Life insurance proceeds (1,281) (1,822) — (659) (462) (2,998)<br>Net gain on disposition of assets — (104) (621) — (770) (1,141)<br>Core Noninterest income $ 18,734 $ 13,303 $ 15,948 $ 13,227 $ 13,607 $ 12,240<br>GAAP Noninterest expense $ 151,389 $ 143,692 $ 147,322 $ 137,931 $ 115,269 $ 111,683<br>Prepayment penalty on borrowings — — — (7,834) — —<br>Accelerated employee benefits upon<br>Officer's death — — — — (455) (149)<br>Net amortization of purchase<br>accounting adjustments (447) (512) (560) (91) — —<br>Miscellaneous/Merger expense (526) — (2,562) (6,894) (1,590) —<br>Core Noninterest expense $ 150,416 $ 143,180 $ 144,200 $ 123,112 $ 113,224 $ 111,534<br>GAAP:<br>Net interest income $ 179,152 $ 243,616 $ 247,969 $ 195,199 $ 161,940 $ 167,406<br>Noninterest income 22,588 10,009 3,687 11,043 9,471 10,337<br>Noninterest expense (151,389) (143,692) (147,322) (137,931) (115,269) (111,683)<br>Pre-provision pre-tax net revenue $ 50,351 $ 109,933 $ 104,334 $ 68,311 $ 56,142 $ 66,060<br>Core:<br>Net interest income $ 177,327 $ 240,299 $ 242,841 $ 196,373 $ 163,618 $ 167,406<br>Noninterest income 18,734 13,303 15,948 13,227 13,607 12,240<br>Noninterest expense (150,416) (143,180) (144,200) (123,112) (113,224) (111,534)<br>Pre-provision pre-tax net revenue $ 45,645 $ 110,422 $ 114,589 $ 86,488 $ 64,001 $ 68,112<br>Efficiency Ratio 76.7 % 56.5 % 55.7 % 58.7 % 63.9 % 62.1 %<br>December 31,<br>2019<br>December 31,<br>2018<br>Years Ended<br>December 31,<br>2020<br>December 31,<br>2023<br>December 31,<br>2022<br>December 31,<br>2021 |
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| 41<br>Reconciliation of GAAP and Core Net Interest Income and NIM - Years<br>1 Excludes purchase accounting average balances for the years ended 2023, 2022, 2021, and 2020<br>(Dollars In thousands)<br>GAAP net interest income $ 179,152 $ 243,616 $ 247,969 $ 195,199 $ 161,940 $ 167,406<br>Net (gain) loss from fair value adjustments<br>on qualifying hedges (371) (775) (2,079) 1,185 1,678 —<br>Net amortization of purchase accounting<br>adjustments (1,454) (2,542) (3,049) (11) — —<br>Tax equivalent adjustment 404 461 450 508 542 895<br>Core net interest income FTE $ 177,731 $ 240,760 $ 243,291 $ 196,881 $ 164,160 $ 168,301<br>Prepayment penalties received on loans and<br>securities, net of reversals and recoveries of<br>interest from nonaccrual loans Net interest income FTE excluding episodic (6,497) (6,627) (4,576) (6,501) (7,058) (7,050)<br>items $ 171,234 $ 234,133 $ 238,715 $ 190,380 $ 157,102 $ 161,251<br>Total average interest-earning assets (1) $ 8,027,898 $ 7,841,407 $ 7,681,441 $ 6,863,219 $ 6,582,473 $ 6,194,248<br>Core net interest margin FTE Net interest margin FTE excluding episodic 2.21 % 3.07 % 3.17 % 2.87 % 2.49 % 2.72 %<br>items 2.13 % 2.99 % 3.11 % 2.77 % 2.39 % 2.60 %<br>GAAP interest income on total loans, net $ 355,348 $ 293,287 $ 274,331 $ 248,153 $ 251,744 $ 232,719<br>Net (gain) loss from fair value adjustments<br>on qualifying hedges (345) (775) (2,079) 1,185 1,678 —<br>Net amortization of purchase accounting<br>adjustments (1,503) (2,628) (3,013) (356) — —<br>Core interest income on total loans, net $ 353,500 $ 289,884 $ 269,239 $ 248,982 $ 253,422 $ 232,719<br>Average total loans, net (1) $ 6,850,124 $ 6,748,165 $ 6,653,980 $ 6,006,931 $ 5,621,033 $ 5,316,968<br>Core yield on total loans 5.16 % 4.30 % 4.05 % 4.14 % 4.51 % 4.38 %<br>Years Ended<br>December 31,<br>2020<br>December 31,<br>2023<br>December 31,<br>2022<br>December 31,<br>2021<br>December 31,<br>2019 2018<br>December 31, |
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| 42<br>Calculation of Tangible Stockholders’ Common Equity to<br>Tangible Assets - Years<br><br>(Dollars in thousands)<br>Total Equity $ 669,837 $ 677,157 $ 679,628 $ 618,997 $ 579,672 $ 549,464<br>Less:<br>Goodwill (17,636) (17,636) (17,636) (17,636) (16,127) (16,127)<br>Core deposit intangibles (1,537) (2,017) (2,562) (3,172) — —<br>Intangible deferred tax liabilities — — 328 287 292 290<br>Tangible Stockholders' Common Equity $ 650,664 $ 657,504 $ 659,758 $ 598,476 $ 563,837 $ 533,627<br>Total Assets $ 8,537,236 $ 8,422,946 $ 8,045,911 $ 7,976,394 $ 7,017,776 $ 6,834,176<br>Less:<br>Goodwill (17,636) (17,636) (17,636) (17,636) (16,127) (16,127)<br>Core deposit intangibles (1,537) (2,017) (2,562) (3,172) — —<br>Intangible deferred tax liabilities — — 328 287 292 290<br>Tangible Assets $ 8,518,063 $ 8,403,293 $ 8,026,041 $ 7,955,873 $ 7,001,941 $ 6,818,339<br>Tangible Stockholders' Common Equity to<br>Tangible Assets 7.64 % 7.82 % 8.22 % 7.52 % 8.05 % 7.83 %<br>December 31,<br>2023<br>December 31,<br>2022<br>December 31, December 31, December 31, December 31,<br>2021 2020 2019 2018 |
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| 43<br>Contact Details<br>Susan K. Cullen<br>SEVP, CFO & Treasurer<br>Phone: (718) 961-5400<br>Email: scullen@flushingbank.com<br>Al Savastano, CFA<br>Director of Investor Relations<br>Phone: (516) 820-1146<br>Email: asavastano@flushingbank.com |
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