Equibles

8-K

FLUSHING FINANCIAL CORP (FFIC)

8-K 2024-01-26 For: 2024-01-25
View Original
Added on 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): January 25, 2024

FLUSHING FINANCIAL CORPORATION
(Exact Name of Registrant as Specified in Charter)
DELAWARE 001-33013 11-3209278
--- --- ---
(State of Incorporation) (Commission File Number) (IRS Employer  Identification No.)
220 RXR Plaza, Uniondale, New York 11556
--- ---
(Address of Principal Executive Offices) (Zip Code)

Registrant's telephone number, including area code: (718) 961-5400

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 2.02. Results of Operations and Financial Condition.

On January 25, 2024, Flushing Financial Corporation (the “Company”) issued a press release, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference.  The information appearing below under Item 4.02 is incorporated herein by reference.

Item 4.02. Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review.

(a)

On January 25, 2024, management and the Audit Committee (the “Audit Committee”) of the Board of Directors of the Company determined that the Company’s consolidated financial statements and ratios for the three month period ended March 31, 2023, the three and  six month periods ended June 30, 2023 and the three and nine month periods ended September 30, 2023, require restatement to correct the accounting treatment of employee retention credits (“ERCs”), which were incorrectly recognized as income during such periods. The change will impact net income by a decrease of $1.1 million for the period ended March 31, 2023, an increase of $0.1 million and a decrease of $1.1 million, respectively, for the three and six month periods ended June 30, 2023, and a decrease of $1.6 million and $2.6 million, respectively, for the three and nine month periods ended September 30, 2023. In the course of preparing the Company’s consolidated financial statements for the fiscal year ended December 31, 2023, the Company determined that, notwithstanding reliance on its independent tax credit advisors as described below, it is not able to treat the ultimate realization of the ERCs as “probable” under U.S. generally accepted accounting practices (“U.S. GAAP”), therefore, requiring the restatement of the Company’s previously issued consolidated financial statements for the referenced periods and amendments to the Company’s related previously filed quarterly reports on Form 10-Q.

Although the Company had engaged an independent national tax credit advisory firm that had advised the Company that it qualified for ERCs as previously reported, the Company has determined that it can no longer rely on such advice.

As a result of the foregoing, the Company’s management and the Audit Committee determined that the Company’s previously issued consolidated financial statements for the three month period ended March 31, 2023, the three and six month periods ended June 30, 2023, and the three and nine month periods ended September 30, 2023, as reported in its applicable Forms 10-Q, were filed on May 10, August 9, and November 7, 2023, respectively, should not be relied upon with respect to the matters described herein. The Company intends to file amendments to each such Form 10-Q to correct the accounting treatment of the ERCs and related impacts and disclosures.

The Audit Committee and management of the Company have discussed the matters disclosed in this current report on Form 8-K with the Company’s independent registered public accounting firm, BDO USA, P.C.

2

The following tables summarize the effects of the restatements on select consolidated financial statements and ratios as reported as of and for the periods stated and are unaudited:

Consolidated Statements of Financial Condition:

As of March 31, 2023
(In thousands) As Reported Adjustments As Restated
Other assets $ 168,259 $ 613 $ 168,872
Total assets 8,479,121 613 8,479,734
Other liabilities 138,710 1,727 140,437
Total liabilities 7,805,662 1,727 7,807,389
Retained earnings 545,786 (1,114 ) 544,672
Total stockholders’ equity 673,459 (1,114 ) 672,345
Total liabilities and stockholders’ equity 8,479,121 613 8,479,734

Consolidated Statements of Income:

For the three months ended March 31, 2023
(In thousands, except per share data) As Reported Adjustments As Restated
Other income $ 1,018 $ (51 ) $ 967
Total non-interest income 6,908 (51 ) 6,857
Salaries and employee benefits 20,887 1,675 22,562
Professional services 2,483 (222 ) 2,261
Total non-interest expense 37,703 1,453 39,156
Income before income taxes 6,959 (1,504 ) 5,455
Federal income tax 1,367 (296 ) 1,071
State and local income tax 434 (94 ) 340
Total provision for income tax 1,801 (390 ) 1,411
Net income 5,158 (1,114 ) 4,044
Basic earnings per common share 0.17 -0.04 0.13
Diluted earnings per common share 0.17 -0.04 0.13

Consolidated Statements of Comprehensive Income:

For the three months ended March 31, 2023
(In thousands) As Reported Adjustments As Restated
Net income $ 5,158 $ (1,114 ) $ 4,044
Comprehensive net income 3,862 (1,114 ) 2,748

Consolidated Statements of Cash Flows:

Operating Activities: For the three months March 31, 2023
(In thousands) As Reported Adjustments As Restated
Net income $ 5,158 $ (1,114 ) $ 4,044
(Increase) decrease in other assets (8,420 ) (613 ) (9,033 )
(Decrease) increase in other liabilities (16,889 ) 1,727 (15,162 )

3

Capital Ratios:

Holding Company

At March 31, 2023
(Dollars in thousands) As Reported Adjustments As Restated
Amount Percent<br><br> <br>of Assets Amount Percent<br><br> <br>of Assets Amount Percent<br><br> <br>of Assets
Tier 1 (Leverage) capital $ 737,138 8.58 % $ (1,114 ) -0.02 % $ 736,024 8.56 %
Common Equity Tier I risk-based capital 690,846 10.37 % (1,114 ) -0.01 % 689,732 10.36 %
Tier I risk-based capital 737,138 11.07 % (1,114 ) -0.02 % 736,024 11.05 %
Total risk-based capital 965,384 14.50 % (1,114 ) -0.02 % 964,270 14.48 %

Capital Ratios:

Bank

At March 31, 2023
(Dollars in thousands) As Reported Adjustments As Restated
Amount Percent<br><br> <br>of Assets Amount Percent<br><br> <br>of Assets Amount Percent<br><br> <br>of Assets
Tier 1 (Leverage) capital $ 906,437 10.55 % $ (1,114 ) -0.02 % $ 905,323 10.53 %
Common Equity Tier I risk-based capital 906,437 13.61 % (1,114 ) -0.02 % 905,323 13.59 %
Tier I risk-based capital 906,437 13.61 % (1,114 ) -0.02 % 905,323 13.59 %
Total risk-based capital 944,683 14.18 % (1,114 ) -0.02 % 943,569 14.16 %

4

Ratios:

For the three months ended March 31, 2023
(Dollars in thousands) As Reported Adjustments As Restated
Dividend Payout Ratio 129.4 % 39.8 % 169.2 %
ROAA 0.24 % -0.05 % 0.19 %
ROAE 3.02 % -0.65 % 2.37 %
Average Balances
Total Assets $ 8,468,311 $ 6 $ 8,468,317
Total Liabilities 7,785,240 19 7,785,259
Stockholders' Equity 683,071 (13 ) 683,058

Consolidated Statements of Financial Condition:

As of June 30, 2023
(In thousands) As Reported Adjustments As Restated
Other assets $ 191,752 $ 969 $ 192,721
Total assets 8,473,883 969 8,474,852
Other liabilities 177,088 2,025 179,113
Total liabilities 7,802,580 2,025 7,804,605
Retained earnings 547,811 (1,056 ) 546,755
Total stockholders’ equity 671,303 (1,056 ) 670,247
Total liabilities and stockholders’ equity 8,473,883 969 8,474,852

Consolidated Statements of Income:

For the three months ended June 30, 2023
(In thousands, except per share data) As Reported Adjustments As Restated
Other income $ 765 $ (102 ) $ 663
Total non-interest income 5,122 (102 ) 5,020
Salaries and employee benefits 19,493 197 19,690
Professional services 2,657 (366 ) 2,291
Total non-interest expense 35,279 (169 ) 35,110
Income before income taxes 11,805 67 11,872
Federal income tax 2,194 24 2,218
State and local income tax 983 (15 ) 968
Total provision for income tax 3,177 9 3,186
Net income 8,628 58 8,686
Basic earnings per common share 0.29 - 0.29
Diluted earnings per common share 0.29 - 0.29

5

Consolidated Statements of Comprehensive Income:

For the three months ended June 30, 2023
(In thousands) As Reported Adjustments As Restated
Net income $ 8,628 $ 58 $ 8,686
Comprehensive net income 10,393 58 10,451

Consolidated Statements of Income:

For the six months ended June 30, 2023
(In thousands, except per share data) As Reported Adjustments As Restated
Other income $ 1,783 $ (153 ) $ 1,630
Total non-interest income 12,030 (153 ) 11,877
Salaries and employee benefits 40,380 1,872 42,252
Professional services 5,140 (588 ) 4,552
Total non-interest expense 72,982 1,284 74,266
Income before income taxes 18,764 (1,437 ) 17,327
Federal income tax 3,561 (272 ) 3,289
State and local income tax 1,417 (109 ) 1,308
Total provision for income tax 4,978 (381 ) 4,597
Net income 13,786 (1,056 ) 12,730
Basic earnings per common share 0.46 -0.04 0.42
Diluted earnings per common share 0.46 -0.04 0.42

Consolidated Statements of Comprehensive Income:

For the six months ended June 30, 2023
(In thousands) As Reported Adjustments As Restated
Net income $ 13,786 $ (1,056 ) $ 12,730
Comprehensive net income 14,255 (1,056 ) 13,199

Consolidated Statements of Cash Flows:

Operating Activities: For the six months ended June 30, 2023
(In thousands) As Reported Adjustments As Restated
Net income $ 13,786 $ (1,056 ) $ 12,730
(Increase) decrease in other assets (15,971 ) (969 ) (16,940 )
(Decrease) increase in other liabilities (10,730 ) 2,025 (8,705 )

6

Capital Ratios:

Holding Company

At June 30, 2023
(Dollars in thousands) As Reported Adjustments As Restated
Amount Percent<br><br> <br>of Assets Amount Percent<br><br> <br>of Assets Amount Percent<br><br> <br>of Assets
Tier 1 (Leverage) capital $ 735,810 8.56 % $ (1,056 ) -0.02 % $ 734,754 8.54 %
Common Equity Tier I risk-based capital 689,876 10.38 % (1,056 ) -0.02 % 688,820 10.36 %
Tier I risk-based capital 735,810 11.07 % (1,056 ) -0.02 % 734,754 11.05 %
Total risk-based capital 963,840 14.50 % (1,056 ) -0.02 % 962,784 14.48 %

Capital Ratios:

Bank

At June 30, 2023
(Dollars in thousands) As Reported Adjustments As Restated
Amount Percent<br><br> <br>of Assets Amount Percent<br><br> <br>of Assets Amount Percent<br><br> <br>of Assets
Tier 1 (Leverage) capital $ 915,247 10.67 % $ (1,056 ) -0.01 % $ 914,191 10.66 %
Common Equity Tier I risk-based capital 915,247 13.76 % (1,056 ) -0.02 % 914,191 13.74 %
Tier I risk-based capital 915,247 13.76 % (1,056 ) -0.02 % 914,191 13.74 %
Total risk-based capital 953,277 14.33 % (1,056 ) -0.02 % 952,221 14.31 %

7

For the three months ended June 30, 2023
(Dollars in thousands) As Reported Adjustments As Restated
Dividend Payout Ratio 75.9 % 0.0 % 75.9 %
ROAA 0.41 % 0.00 % 0.41 %
ROAE 5.12 % 0.04 % 5.16 %
Average Balances
Total Assets $ 8,461,827 $ 615 $ 8,462,442
Total Liabilities 7,787,884 1,723 7,789,607
Stockholders' Equity 673,943 (1,108 ) 672,835
For the six months ended June 30, 2023
--- --- --- --- --- --- --- --- --- ---
(Dollars in thousands) As Reported Adjustments As Restated
Dividend Payout Ratio 95.7 % 9.1 % 104.8 %
ROAA 0.33 % -0.03 % 0.30 %
ROAE 4.06 % -0.30 % 3.76 %
Average Balances
Total Assets $ 8,465,051 $ 312 $ 8,465,363
Total Liabilities 7,786,570 875 7,787,445
Stockholders' Equity 678,481 (563 ) 677,918

Consolidated Statements of Financial Condition:

As of September 30, 2023
(In thousands) As Reported Adjustments As Restated
Other assets $ 206,922 $ 2,092 $ 209,014
Total assets 8,577,283 2,092 8,579,375
Other liabilities 182,556 4,712 187,268
Total liabilities 7,908,142 4,712 7,912,854
Retained earnings 550,678 (2,620 ) 548,058
Total stockholders’ equity 669,141 (2,620 ) 666,521
Total liabilities and stockholders’ equity 8,577,283 2,092 8,579,375

8

Consolidated Statements of Income:

For the three months ended September 30, 2023
(In thousands, except per share data) As Reported Adjustments As Restated
Other income $ 282 $ (167 ) $ 115
Total non-interest income 3,476 (167 ) 3,309
Salaries and employee benefits 17,825 2,521 20,346
Professional services 3,042 (548 ) 2,494
Total non-interest expense 34,415 1,973 36,388
Income before income taxes 12,892 (2,140 ) 10,752
Federal income tax 2,435 (406 ) 2,029
State and local income tax 1,058 (170 ) 888
Total provision for income tax 3,493 (576 ) 2,917
Net income 9,399 (1,564 ) 7,835
Basic earnings per common share 0.32 -0.06 0.26
Diluted earnings per common share 0.32 -0.06 0.26

Consolidated Statements of Comprehensive Income:

For the three months ended September 30, 2023
(In thousands) As Reported Adjustments As Restated
Net income $ 9,399 $ (1,564 ) $ 7,835
Comprehensive net income 4,487 (1,564 ) 2,923

Consolidated Statements of Income:

For the nine months ended September 30, 2023
(In thousands, except per share data) As Reported Adjustments As Restated
Other income $ 2,065 $ (320 ) $ 1,745
Total non-interest income 15,506 (320 ) 15,186
Salaries and employee benefits 58,205 4,393 62,598
Professional services 8,182 (1,136 ) 7,046
Total non-interest expense 107,397 3,257 110,654
Income before income taxes 31,656 (3,577 ) 28,079
Federal income tax 5,996 (678 ) 5,318
State and local income tax 2,475 (279 ) 2,196
Total provision for income tax 8,471 (957 ) 7,514
Net income 23,185 (2,620 ) 20,565
Basic earnings per common share 0.77 -0.08 0.69
Diluted earnings per common share 0.77 -0.08 0.69

9

Consolidated Statements of Comprehensive Income:

For the nine months ended September 30, 2023
(In thousands) As Reported Adjustments As Restated
Net income $ 23,185 $ (2,620 ) $ 20,565
Comprehensive net income 18,742 (2,620 ) 16,122

Consolidated Statements of Cash Flows:

Operating Activities: For the nine months ended September 30, 2023
(In thousands) As Reported Adjustments As Restated
Net income $ 23,185 $ (2,620 ) $ 20,565
(Increase) decrease in other assets (16,619 ) (2,092 ) (18,711 )
(Decrease) Increase in other liabilities (11,505 ) 4,712 (6,793 )

Capital Ratios:

Holding Company

At September 30, 2023
(Dollars in thousands) As Reported Adjustments As Restated
Amount Percent<br><br> <br>of Assets Amount Percent<br><br> <br>of Assets Amount Percent<br><br> <br>of Assets
Tier 1 (Leverage) capital $ 739,364 8.54 % $ (2,620 ) -0.03 % $ 736,744 8.51 %
Common Equity Tier I risk-based capital 692,914 10.19 % (2,620 ) -0.05 % 690,294 10.14 %
Tier I risk-based capital 739,364 10.87 % (2,620 ) -0.04 % 736,744 10.83 %
Total risk-based capital 968,152 14.23 % (2,620 ) -0.04 % 965,532 14.19 %

10

Capital Ratios:

Bank

At September 30, 2023
(Dollars in thousands) As Reported Adjustments As Restated
Amount Percent<br><br> <br>of Assets Amount Percent<br><br> <br>of Assets Amount Percent<br><br> <br>of Assets
Tier 1 (Leverage) capital $ 918,167 10.61 % $ (2,620 ) -0.03 % $ 915,547 10.58 %
Common Equity Tier I risk-based capital 918,167 13.49 % (2,620 ) -0.04 % 915,547 13.45 %
Tier I risk-based capital 918,167 13.49 % (2,620 ) -0.04 % 915,547 13.45 %
Total risk-based capital 956,955 14.06 % (2,620 ) -0.04 % 954,335 14.02 %
For the three months ended September 30, 2023
--- --- --- --- --- --- --- --- --- ---
(Dollars in thousands) As Reported Adjustments As Restated
Dividend Payout Ratio 68.8 % 15.8 % 84.6 %
ROAA 0.44 % -0.07 % 0.37 %
ROAE 5.57 % -0.93 % 4.64 %
Average Balances
Total Assets $ 8,504,364 $ 982 $ 8,505,346
Total Liabilities 7,828,851 1,454 7,830,305
Stockholders' Equity 675,513 (472 ) 675,041

11

For the nine months ended September 30, 2023
(Dollars in thousands) As Reported Adjustments As Restated
Dividend Payout Ratio 85.7 % 10.0 % 95.7 %
ROAA 0.36 % -0.04 % 0.32 %
ROAE 4.56 % -0.51 % 4.05 %
Average Balances
Total Assets $ 8,478,299 $ 538 $ 8,478,837
Total Liabilities 7,800,818 1,071 7,801,889
Stockholders' Equity 677,481 (533 ) 676,948
Item 8.01. Other Events.
--- ---

In connection with its evaluation of the restatements described in Item 4.02 above, management of the Company has concluded that a material weakness in the Company’s internal control over financial reporting existed as of March 31, June 30, and September 30, 2023. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. Specifically, the Company did not maintain effective controls over the probability assessment associated with the recognition of income related to the ERCs.

The Company’s management is taking steps to remediate the material weakness in its internal control over financial reporting relating to the probability assessment associated with the recognition of income related to ERCs.  These steps will include the preparation of a technical accounting memorandum for any material unusual transactions including careful evaluation of any probability assessments or other areas of judgement involved, such as the ERCs, to determine the correct accounting treatment for such transactions.  Management believes the additional control procedures designed, when implemented, will fully remediate the material weakness.

Item 9.01. Financial Statements and Exhibits.
Exhibit 99.1 Press release dated January 25, 2024.
--- ---

12

SIGNATURES

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.

Date:  January 25, 2024 FLUSHING FINANCIAL CORPORATION
By: /s/ Susan K. Cullen
Name: Susan K. Cullen
--- ---
Title: Chief Financial Officer

13

Exhibit 99.1
Flushing Financial Corporation<br> Reports 2023 and 4Q23 GAAP EPS of 0.96 and 0.27, and Core EPS of 0.83 and 0.25, Respectively;<br> Continues to Successfully Execute On Its Action Plan
“Flushing Financial delivered sequential GAAP and Core NIM expansion in 4Q23 of 7 and 18 basis points, respectively, as our team continued to successfully execute against the previously<br> announced action plan amid this challenging environment. Importantly, during the quarter, total average deposits increased 3.1% YoY and 0.9% QoQ, while average noninterest bearing deposits increased 21.6 million, or 2.5% QoQ. Our loan<br> portfolio remains resilient through the credit cycle with 89% secured by real estate, strong debt service coverage ratios, low average loan to values, and controllable repricing risk. Credit quality continues to be a strength for the<br> Company with less than one basis point of net charge-offs in 4Q23 although there was a slight uptick in NPAs.<br> Given our progress to date, we are expanding our areas of focus to include: 1) increasing NIM and reducing volatility; 2) maintaining credit discipline; 3) preserving strong liquidity and<br> capital; and 4) bending the expense curve. Continuing to advance these priorities will enable us to navigate the current environment while positioning the Company for long-term profitable growth.”<br>  <br> - John R. Buran, President and CEO
UNIONDALE, N.Y., January 25, 2024 (GLOBE NEWSWIRE) – GAAP and Core NIM Expand QoQ;<br> Average Total Deposits Increase. The Company reported fourth quarter and full year 2023 GAAP EPS of 0.27 and 0.96, respectively. Core EPS for the fourth quarter and full year of 2023 totaled 0.25<br> and 0.83, respectively. 4Q23 GAAP NIM was 2.29% while Core NIM amounted to 2.31%. The actions undertaken in 2023 to reduce interest rate risk, including adding interest rate hedges and floating rate loans, assisted in reducing the NIM<br> compression. Absent episodic items, the NIM was 2.14%, an increase of 5 basis points quarter over quarter. Average total deposits increased 3.1% YoY and 0.9% QoQ while importantly, noninterest bearing deposits increased 21.6 million, or 2.5%<br> QoQ.<br> Strong Credit Quality; Stable Capital. Nonperforming assets to total assets increased to 54 bps compared to 45 bps in 3Q23, while criticized and classified loans to<br> loans was 1.11% in 4Q23, compared to 1.08% in 3Q23. Net charge-offs were only 60 thousand in 4Q23. Capital continues to be sound with TCE/TA1 of 7.64% at<br> December 31, 2023, compared to 7.56% at September 30, 2023. The Company repurchased 38,815 shares at an average cost 15.08 (33% discount to tangible book value) during 4Q23.

All values are in US Dollars.

Key Financial Metrics^2^
4Q23 3Q23 2Q23 1Q23 4Q22 2023 2022
--- --- --- --- --- --- --- ---
GAAP:
EPS $0.27 $0.26 $0.29 $0.13 $0.34 $0.96 $2.50
ROAA (%) 0.38 0.37 0.41 0.19 0.48 0.34 0.93
ROAE (%) 4.84 4.64 5.16 2.37 6.06 4.25 11.44
NIM FTE^3^ (%) 2.29 2.22 2.18 2.27 2.70 2.24 3.11
Core:
EPS $0.25 $0.25 $0.26 $0.06 $0.57 $0.83 $2.49
ROAA (%) 0.35 0.36 0.37 0.09 0.82 0.29 0.92
ROAE (%) 4.51 4.49 4.70 1.11 10.29 3.69 11.42
Core NIM FTE (%) 2.31 2.13 2.17 2.25 2.63 2.21 3.07
Credit Quality:
NPAs/Loans & OREO (%) 0.67 0.56 0.58 0.61 0.77 0.67 0.77
ACLs/Loans (%) 0.58 0.57 0.57 0.56 0.58 0.58 0.58
ACLs/NPLs (%) 159.55 225.38 207.08 182.89 124.89 159.55 124.89
NCOs/Avg Loans (%) - - 0.09 0.54 0.05 0.16 0.02
Balance Sheet:
Avg Loans ($B) $6.9 $6.8 $6.8 $6.9 $6.9 $6.8 $6.7
Avg Dep ($B) $6.9 $6.8 $6.9 $6.8 $6.7 $6.9 $6.5
Book Value/Share $23.21 $23.06 $23.14 $22.80 $22.97 $23.21 $22.97
Tangible BV/Share $22.54 $22.39 $22.47 $22.14 $22.31 $22.54 $22.31
TCE/TA (%) 7.64 7.56 7.70 7.72 7.82 7.64 7.82

Note: In certain circumstances, reclassifications have been made to prior periods to conform to the current presentation.

^1^ Tangible Common Equity (“TCE”)/Total Assets (“TA”) ^2^ See “Reconciliation of GAAP Earnings and Core Earnings”, “Reconciliation of GAAP Revenue and Pre-Provision Pre-Tax Net Revenue”, and “Reconciliation of GAAP Net Interest Margin to Core Net Interest Income and Net Interest Margin.” ^3^ Net Interest Margin (“NIM”) Fully Taxable Equivalent (“FTE”).

Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 1

4Q23 Highlights
• Net interest margin FTE decreased 41 bps YoY, but increased 7 bps QoQ to 2.29%; Core net interest margin FTE decreased 32 bps YoY but improved 18 bps QoQ to 2.31%; Both GAAP and Core NIM benefited from prepayment<br><br><br><br><br><br><br><br><br><br><br><br> penalty income, net reversals and recovered interest from nonaccrual loans, and customer swap termination fees, which totaled $3.4 million or 17 bps in 4Q23
--- ---
• Average total deposits increased 3.1% YoY and 0.9% QoQ to $6.9 billion; Average noninterest bearing deposits increased $21.6 million QoQ, totaling 12.7% of average total deposits compared to 14.7% in 4Q22 and 12.5% in 3Q23. Average CDs<br> were $2.3 billion, up 73.3% YoY and 2.2% QoQ
--- ---
• Period end net loans decreased 0.4% YoY, but increased 0.1% QoQ; Loan closings were $244.3 million up 8.5% YoY and 1.2% QoQ; The yields on closings increased 159 bps YoY and 21 bps QoQ to 7.69%; Back-to-back swap loan originations were<br> $121.6 million compared to $120.5 million in 3Q23 and generated $1.5 million and $1.6 million of noninterest income, respectively; Loan pipeline decreased 35.3% YoY and 55.1% QoQ to $163.1 million; Approximately 29% of the loan pipeline<br> consists of back-to-back swap loans
--- ---
• NPAs decreased to $46.2 million from $53.4 million a year ago but increased from $38.4 million in the prior quarter
--- ---
• As separately disclosed, we have not recognized and have restated for employee retention credits formerly recognized during periods of 2023, and have fully reserved for approximately $7.0 million ($0.17/share, after tax) of refunds
--- ---
• 4Q23 noninterest expense was impacted by increasing DDA balances and strong loan production
--- ---
• Provision for credit losses was $1.0 million in 4Q23 compared to negligible amount in 4Q22 and $0.6 million in 3Q23; Net charge-offs (recoveries) were $60,000 in 4Q23 compared to $0.8 million in 4Q22 and $(42,000) in 3Q23
--- ---
• Tangible Common Equity to Tangible Assets increased to 7.64% at 4Q23 compared to 7.56% at 3Q23; Repurchased 38,815 shares at an average price of $15.08 or a 33% discount to December 31, 2023, tangible book value of $22.54
--- ---
Areas of Focus
--- --- ---
Increase<br><br> <br> <br>NIM and<br><br> <br> <br>Reduce<br><br> <br> <br>Volatility • GAAP and Core NIM improved 7 bps and 18 bps QoQ, respectively, in 4Q23
• NIM improved 5 bps QoQ to 2.14%, absent episodic items^1^
• Largely achieved the goal of becoming interest rate neutral to a 100 bps change in rates
• Approximately 25% of the loan portfolio consists of floating rate loans (including interest rate hedges)
• Average noninterest bearing increased 2.5% QoQ and accounted for 12.7% of average total deposits
Maintain<br><br> <br> <br>Credit<br><br> <br> <br>Discipline • Approximately 89% of the loan portfolio is collateralized by real estate with an average loan to value of less than 36%
• Weighted average debt service coverage ratio is approximately 1.8x for multifamily and investor commercial real<br> estate loans
• NPAs are a low 54 bps of assets and criticized and classified loans are 1.11% of loans
• Manhattan office buildings exposure is minimal at 0.6% of net loans
Preserve<br><br> <br> <br>Strong<br><br> <br> <br>Liquidity<br><br> <br> <br>and Capital • Maintaining ample liquidity with $4.1 billion of undrawn lines and<br> resources
• Uninsured and uncollateralized deposits were 17% of total deposits, while uninsured deposits were 30% of total<br> deposits
• Total average deposits increased 3.1% YoY and 0.9% QoQ
• Checking account openings declined 6.6% YoY in 4Q23, but were up 5.7% in 2023
• Tangible Common Equity to Tangible Assets improved to 7.64% QoQ
• Leverage ratio remains stable at 8.47%
Bend the<br><br>  Expense<br><br> <br> <br>Curve • GAAP noninterest expense to average assets was 1.90% in 4Q23 compared to 1.58% in 4Q22 and 1.71% in 3Q23
• 4Q23 noninterest expense was impacted by increasing DDA balances and strong loan production
• 1Q24 seasonal expenses are expected to be less than half of the $4.1 million recorded in 1Q23
^1^ Episodic items include prepayment penalty income, customer swap termination fees, net reversals and recovered interest from nonaccrual loans, net gain/loss from fair value on qualifying hedges, and purchase<br> accounting adjustments
--- ---
Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 2
--- ---

Income Statement Highlights
YoY QoQ
--- --- --- --- --- --- --- --- --- ---
($000s, except EPS) 4Q23 3Q23 2Q23 1Q23 4Q22 Change Change
Net Interest Income $46,085 $44,427 $43,378 $45,262 $54,201 (15.0) % 3.7 %
Provision (Benefit) for Credit Losses 998 596 1,416 7,508 (12) (8,416.7) 67.4
Noninterest Income (Loss) 7,402 3,309 5,020 6,857 (7,652) (196.7) 123.7
Noninterest Expense 40,735 36,388 35,110 39,156 33,742 20.7 11.9
Income Before Income Taxes 11,754 10,752 11,872 5,455 12,819 (8.3) 9.3
Provision for Income Taxes 3,655 2,917 3,186 1,411 2,570 42.2 25.3
Net Income $8,099 $7,835 $8,686 $4,044 $10,249 (21.0) 3.4
Diluted EPS $0.27 $0.26 $0.29 $0.13 $0.34 (20.6) 3.8
Avg. Diluted Shares (000s) 29,650 29,703 30,090 30,265 30,420 (2.5) (0.2)
Core Net Income^1^ $7,546 $7,571 $7,912 $1,889 $17,399 (56.6) (0.3)
Core EPS^1^ $0.25 $0.25 $0.26 $0.06 $0.57 (56.1) -

^1^ See Reconciliation of GAAP Earnings and Core Earnings

Net interest income decreased YoY but increased QoQ.

• Net Interest Margin FTE of 2.29% decreased 41 bps YoY, but increased 7 bps QoQ
• Prepayment penalty income, customer swap termination fees, net reversals and recoveries of interest from nonaccrual loans, net gains and losses from fair value adjustments on qualifying hedges, and<br> purchase accounting accretion totaled $3.0 million (15 bps to the NIM) compared to $2.6 million (13 bps to the NIM) in 3Q23, $0.5 million (3 bps) in 2Q23, $1.1 million (6 bps) in 1Q23, and $2.4 million (12 bps) in 4Q22
--- ---
• Excluding the items in the previous bullet, net interest margin was 2.14% in 4Q23, 2.09% in 3Q23, 2.15% in 2Q23, 2.21% in 1Q23, and 2.58% in 4Q22
--- ---

The provision for credit losses increased YoY and QoQ.

• Net charge-offs (recoveries) were $60,000 in 4Q23 (less than 1 bp of average loans) compared to $(42,000) in 3Q23 (less than (1) bp of average loans), $1.6 million in 2Q23 (9 bps of average loans), $9.2 million in 1Q23 (54 bps of average<br> loans), and $0.8 million in 4Q22 (5 bps of average loans)
• 1Q23 net charge-offs were primarily related to a commercial business relationship that was placed on nonaccrual in 2Q22
--- ---

Noninterest income (loss) increased YoY and QoQ.

• Back-to-back swap loan closings of $121.6 million in 4Q23 (compared to $120.5 million in 3Q23 and $11.5 million in 2Q23) contributed to the YoY growth in core noninterest income; the Company earns fee income on back-to-back swap loan<br> closings
• Net gains (losses) from fair value adjustments were $0.9 million in 4Q23 ($0.02 per share, net of tax), $(1.2) million in 3Q23 ($(0.03) per share, net of tax), $0.3 million in 2Q23 ($0.01 per share, net of tax), $2.6 million in 1Q23<br> ($0.06 per share, net of tax), and $(0.6) million in 4Q22 ($(0.02) per share, net of tax)
--- ---
• Life insurance proceeds were $0.7 million in 4Q23 ($0.02 per share), $23,000 in 3Q23 (less than $0.01 per share), $0.6 million ($0.02 per share) in 2Q23, and $0.3 million ($0.01 per share) in 4Q22
--- ---
• Loss on the sale of securities was $10.9 million ($0.27 per share, net of tax) in 4Q22 as the Company sold $84.2 million of mortgage-based securities with an approximate yield of 1.17%; proceeds were primarily reinvested in 1Q23 into<br> floating rate securities that had a yield at that time approximating 6.40%
--- ---
• Absent the items in the previous three bullets and other immaterial adjustments, core noninterest income was $5.8 million in 4Q23, up 64.4% YoY and 28.0% QoQ
--- ---
• 4Q23 other fee income includes net realized gains on the sale of assets and other dividends from nonqualified plans that are expected to normalize in future periods
--- ---

Noninterest expense increased YoY and QoQ.

• 4Q23 noninterest expense was impacted by increasing DDA balances and strong loan production
• Seasonal compensation expense was $4.1 million in 1Q23; seasonal expenses are expected to be less than half in 1Q24
--- ---
Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 3
--- ---

• Excluding the effects of immaterial adjustments, core operating expenses were $40.1 million in 4Q23, up 19.3% YoY, and 10.5% QoQ
• GAAP noninterest expense to average assets was 1.90% in 4Q23, 1.71% in 3Q23, 1.66% in 2Q23, 1.85% in 1Q23, and 1.58% in 4Q22
--- ---

Provision for income taxes increased YoY and QoQ.

• The effective tax rate was 31.1% in 4Q23, 27.1% in 3Q23, 26.8% in 2Q23, 25.9% in 1Q23, and 20.0% in 4Q22
• The 4Q23 effective tax rate increased as a result of preferential tax items having a smaller impact due to higher pre-tax income than estimated in 3Q23 and 2Q23; the 4Q22 effective tax rate had preferential tax items that had a larger<br> impact as a result of lower levels of pre-tax income
--- ---
Balance Sheet, Credit Quality, and Capital Highlights
--- --- --- --- --- --- --- --- ---
YoY QoQ
3Q23 2Q23 1Q23 4Q22 Change Change
Averages (MM)
Loans $6,813 $6,830 $6,871 $6,881 (0.2) % 0.8 %
Total Deposits 6,819 6,900 6,810 6,678 3.1 1.0
Credit Quality (000s)
Nonperforming Loans $17,405 $18,637 $21,176 $32,382 (22.3) % 44.6 %
Nonperforming Assets 38,386 39,618 42,157 53,363 (13.5) 20.2
Criticized and Classified Loans 74,169 48,675 58,130 68,093 12.7 3.4
Criticized and Classified Assets 95,150 69,656 79,111 89,073 9.7 2.7
Allowance for Credit Losses/Loans (%) 0.57 0.57 0.56 0.58 - bps 1 bp
Capital
Book Value/Share $23.06 $23.14 $22.80 $22.97 1.0 % 0.7 %
Tangible Book Value/Share 22.39 22.47 22.14 22.31 1.0 0.7
Tang. Common Equity/Tang. Assets (%) 7.56 7.70 7.72 7.82 (18) bps 8 bps
Leverage Ratio (%) 8.51 8.54 8.56 8.61 (14) (4)

All values are in US Dollars.

Average loans decreased YoY but increased QoQ.

• Period end net loans totaled $6.9 billion, down 0.4% YoY, but up 0.1% QoQ
• Total loan closings were $244.3 million in 4Q23, $241.5 million in 3Q23, $158.8 million in 2Q23, $173.5 million in 1Q23, and $225.2 million in 4Q22; the loan pipeline was $163.1 million at December 31, 2023, down 35.3% YoY and 55.1% QoQ
--- ---
• The diversified loan portfolio is approximately 89% collateralized by real estate with an average loan-to-value ratio of less than 36%
--- ---
• Manhattan office buildings exposure is minimal at 0.6% of net loans
--- ---

Average total deposits increased YoY and QoQ.

• Average noninterest bearing deposits decreased 10.9% YoY, but increased 2.5% QoQ in 4Q23 and comprised 12.7% of average total deposits in 4Q23 compared to 14.7% a year ago
• Average CDs totaled $2.3 billion, up 73.3% YoY and 2.2% QoQ; approximately $408.6 million of non-swapped CDs are due to mature at a rate of 3.20% in 1Q24
--- ---

Credit Quality: Nonperforming loans declined YoY but increased QoQ.

• Criticized and classified loans were 111 bps of gross loans at 4Q23 compared to 108 bps at 3Q23, 71 bps at 2Q23, 84 bps at 1Q23, and 98 bps at 4Q22
• Allowance for credit losses were 159.5% of nonperforming loans at 4Q23 compared to 124.9% at 4Q22 and 225.4% at 3Q23
--- ---

Capital: Book value per common share and tangible book value per common share, a non-GAAP measure, both increased 1.0% YoY and 0.7% QoQ to $23.21 and $22.54, respectively.

Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 4

• The Company paid a dividend of $0.22 per share in 4Q23; repurchased 38,815 shares in 4Q23 at an average price of $15.08, representing a 33% discount to tangible book value; 807,964 shares remaining subject to repurchase under the authorized stock repurchase program, which has no expiration or maximum dollar limit
• Tangible common equity to tangible assets was 7.64% at December 31, 2023, compared to 7.82% at December 31, 2022, and 7.56% at September 30, 2023
--- ---
Conference Call Information and First Quarter Earnings Release Date
---

Conference Call Information:

• John R. Buran, President and Chief Executive Officer, Tom Buonaiuto, Senior Executive Vice President, Chief of Staff, and Deposit Channel Executive,<br> and Susan K. Cullen, Senior Executive Vice President and Chief Financial Officer and Treasurer, will host a conference call on Friday, January 26, 2024, at 11:00 AM (ET) to discuss the Company’s fourth quarter and full year results and<br> strategy.
• Dial-in for Live Call: 1-877-509-5836; Canada 855-669-9657
--- ---
• Webcast: https://event.choruscall.com/mediaframe/webcast.html?webcastid=VQZ8mq4o
--- ---
• Dial-in for Replay: 1-877-344-7529; Canada 855-669-9658
--- ---
• Replay Access Code: 6289639
--- ---
• The conference call will be simultaneously webcast and archived
--- ---

First Quarter 2024 Earnings Release Date:

The Company plans to release First Quarter 2024 financial results after the market close on April 23, 2024; followed by a conference call at 9:30 AM (ET) on April 24, 2024.

A detailed announcement will be issued prior to the first quarter’s close confirming the date and time of the earnings release.

About Flushing Financial Corporation

Flushing Financial Corporation (Nasdaq: FFIC) is the holding company for Flushing Bank®, an FDIC insured, New York State—chartered commercial bank that operates banking offices in Queens, Brooklyn, Manhattan, and on Long Island. The Bank has been building relationships with families, business owners, and communities since 1929. Today, it offers the products, services, and conveniences associated with large commercial banks, including a full complement of deposit, loan, equipment finance, and cash management services. Rewarding customers with personalized attention and bankers that can communicate in the languages prevalent within these multicultural markets is what makes the Bank uniquely different. As an Equal Housing Lender and leader in real estate lending, the Bank’s experienced lending teams create mortgage solutions for real estate owners and property managers both within and outside the New York City metropolitan area. The Bank also fosters relationships with consumers nationwide through its online banking division with the iGObanking® and BankPurely® brands.

Additional information on Flushing Bank and Flushing Financial Corporation may be obtained by visiting the Company’s website at FlushingBank.com. Flushing Financial Corporation’s earnings release and presentation slides will be available prior to the conference call at www.FlushingBank.com under Investor Relations.

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: Statements in this Press Release relating to plans, strategies, economic performance and trends, projections of results of specific activities or investments and other statements that are not descriptions of historical facts may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking information is inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of factors, which include, but are not limited to, risk factors discussed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022 and in other documents filed by the Company with the Securities and Exchange Commission from time to time. Forward-looking statements may be identified by terms such as “may”, “will”, “should”, “could”, “expects”, “plans”, “intends”, “anticipates”, “believes”, “estimates”, “predicts”, “forecasts”, “goals”, “potential” or “continue” or similar terms or the negative of these terms. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. The Company has no obligation to update these forward-looking statements.

#FF

- Statistical Tables Follow -

Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 5

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

FINANCIAL HIGHLIGHTS

(Unaudited)

At or for the three months ended At or for the year ended
December 31, September 30, June 30, March 31, December 31, December 31, December 31,
(Dollars in thousands, except per share data) 2023 2023 2023 2023 2022 2023 2022
Performance Ratios ^(1)^
Return on average assets 0.38 % 0.37 % 0.41 % 0.19 % 0.48 % 0.34 % 0.93 %
Return on average equity 4.84 4.64 5.16 2.37 6.06 4.25 11.44
Yield on average interest-earning assets ^(2)^ 5.39 5.19 4.84 4.61 4.44 5.01 4.05
Cost of average interest-bearing liabilities 3.68 3.52 3.15 2.80 2.11 3.29 1.13
Cost of funds 3.26 3.13 2.80 2.47 1.84 2.91 0.98
Net interest rate spread during period^(2)^ 1.71 1.67 1.69 1.81 2.33 1.72 2.92
Net interest margin ^(2)^ 2.29 2.22 2.18 2.27 2.70 2.24 3.11
Noninterest expense to average assets 1.90 1.71 1.66 1.85 1.58 1.78 1.73
Efficiency ratio ^(3)^ 76.69 76.76 73.82 79.52 59.55 76.72 56.46
Average interest-earning assets to average interest-bearing liabilities 1.19 X 1.18 X 1.18 X 1.19 X 1.21 X 1.19 X 1.22 X
Average Balances
Total loans, net $ 6,867,927 $ 6,813,019 $ 6,829,648 $ 6,871,192 $ 6,881,245 $ 6,845,349 $ 6,741,590
Total interest-earning assets 8,076,991 8,023,237 7,991,756 8,002,376 8,045,691 8,023,793 7,835,654
Total assets 8,569,002 8,505,346 8,462,442 8,468,317 8,518,019 8,501,564 8,307,137
Total deposits 6,884,037 6,819,397 6,899,617 6,810,485 6,678,383 6,853,494 6,451,746
Total interest-bearing liabilities 6,813,909 6,771,860 6,756,859 6,703,558 6,662,209 6,761,877 6,444,805
Stockholders' equity 669,819 675,041 672,835 683,058 676,165 675,151 672,742
Per Share Data
Book value per common share ^(4)^ $ 23.21 $ 23.06 $ 23.14 $ 22.80 $ 22.97 $ 23.21 $ 22.97
Tangible book value per common share ^(5)^ $ 22.54 $ 22.39 $ 22.47 $ 22.14 $ 22.31 $ 22.54 $ 22.31
Stockholders' Equity
Stockholders' equity $ 669,837 $ 666,521 $ 670,247 $ 672,345 $ 677,157 $ 669,837 $ 677,157
Tangible stockholders' equity 650,664 647,234 650,842 652,818 657,504 650,664 657,504
Consolidated Regulatory Capital Ratios
Tier 1 capital $ 737,732 $ 736,744 $ 734,754 $ 736,024 $ 746,880 $ 737,732 $ 746,880
Common equity Tier 1 capital 691,754 690,294 688,820 689,732 698,258 691,754 698,258
Total risk-based capital 967,627 965,532 962,784 964,270 975,709 967,627 975,709
Risk Weighted Assets 6,750,301 6,804,478 6,650,222 6,660,145 6,640,542 6,750,301 6,640,542
Tier 1 leverage capital (well capitalized = 5%) 8.47 % 8.51 % 8.54 % 8.56 % 8.61 % 8.47 % 8.61 %
Common equity Tier 1 risk-based capital (well capitalized = 6.5%) 10.25 10.14 10.36 10.36 10.52 10.25 10.52
Tier 1 risk-based capital (well capitalized = 8.0%) 10.93 10.83 11.05 11.05 11.25 10.93 11.25
Total risk-based capital (well capitalized = 10.0%) 14.33 14.19 14.48 14.48 14.69 14.33 14.69
Capital Ratios
Average equity to average assets 7.82 % 7.94 % 7.95 % 8.07 % 7.94 % 7.94 % 8.10 %
Equity to total assets 7.85 7.77 7.91 7.93 8.04 7.85 8.04
Tangible common equity to tangible assets ^(6)^ 7.64 7.56 7.70 7.72 7.82 7.64 7.82
Asset Quality
Nonaccrual loans ^(7)^ $ 23,709 $ 17,405 $ 18,637 $ 21,176 $ 29,782 $ 23,709 $ 29,782
Nonperforming loans 25,172 17,405 18,637 21,176 32,382 25,172 32,382
Nonperforming assets 46,153 38,386 39,618 42,157 53,363 46,153 53,363
Net charge-offs (recoveries) 60 (42) 1,560 9,234 811 10,812 1,535
Asset Quality Ratios
Nonperforming loans to gross loans 0.36 % 0.25 % 0.27 % 0.31 % 0.47 % 0.36 % 0.47 %
Nonperforming assets to total assets 0.54 0.45 0.47 0.50 0.63 0.54 0.63
Allowance for credit losses to gross loans 0.58 0.57 0.57 0.56 0.58 0.58 0.58
Allowance for credit losses to nonperforming assets 87.02 102.19 97.41 91.87 75.79 87.02 75.79
Allowance for credit losses to nonperforming loans 159.55 225.38 207.08 182.89 124.89 159.55 124.89
Net charge-offs (recoveries) to average loans — — 0.09 0.54 0.05 0.16 0.02
Full-service customer facilities 27 27 26 26 25 27 25

(See footnotes on next page)

Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 6

^(1)^ Ratios are presented on an annualized basis, where appropriate.
^(2)^ Yields are calculated on the tax equivalent basis using the statutory federal income tax rate of 21% for the periods presented.
--- ---
^(3)^ 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 interest income and core<br> noninterest income.
--- ---
^(4)^ Calculated by dividing stockholders’ equity by shares outstanding.
--- ---
^(5)^ Calculated by dividing tangible stockholders’ common equity, a non-GAAP measure, by shares outstanding. Tangible stockholders’ common equity is stockholders’ equity less intangible assets. See “Calculation of<br> Tangible Stockholders’ Common Equity to Tangible Assets”.
--- ---
^(6)^ See “Calculation of Tangible Stockholders’ Common Equity to Tangible Assets”.
--- ---
^(7)^ Excludes performing nonaccrual TDR loans in periods prior to 1Q23.
--- ---
Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 7
--- ---

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

For the three months ended For the year ended
December 31, September 30, June 30, March 31, December 31, December 31, December 31,
(In thousands, except per share data) 2023 2023 2023 2023 2022 2023 2022
Interest and Dividend Income
Interest and fees on loans $ 95,616 $ 91,466 $ 85,377 $ 82,889 $ 81,033 $ 355,348 $ 293,287
Interest and dividends on securities:
Interest 10,803 10,383 9,172 7,240 6,511 37,598 20,861
Dividends 34 33 30 29 24 126 60
Other interest income 2,310 2,154 1,982 1,959 1,702 8,405 2,418
Total interest and dividend income 108,763 104,036 96,561 92,117 89,270 401,477 316,626
Interest Expense
Deposits 53,284 50,066 46,249 39,056 27,226 188,655 47,285
Other interest expense 9,394 9,543 6,934 7,799 7,843 33,670 25,725
Total interest expense 62,678 59,609 53,183 46,855 35,069 222,325 73,010
Net Interest Income 46,085 44,427 43,378 45,262 54,201 179,152 243,616
Provision (benefit) for credit losses 998 596 1,416 7,508 (12 ) 10,518 5,081
Net Interest Income After Provision (Benefit) for Credit Losses 45,087 43,831 41,962 37,754 54,213 168,634 238,535
Noninterest Income (Loss)
Banking services fee income 2,824 2,636 1,780 1,411 1,231 8,651 5,122
Net loss on sale of securities — — — — (10,948 ) — (10,948 )
Net gain on sale of loans — — 54 54 46 108 119
Net gain on disposition of assets — — — — 104 — 104
Net gain (loss) from fair value adjustments 906 (1,246 ) 294 2,619 (622 ) 2,573 5,728
Federal Home Loan Bank of New York stock dividends 658 624 534 697 658 2,513 2,000
Life insurance proceeds 697 23 561 — 286 1,281 1,822
Bank owned life insurance 1,173 1,157 1,134 1,109 1,126 4,573 4,487
Other income 1,144 115 663 967 467 2,889 1,575
Total noninterest income (loss) 7,402 3,309 5,020 6,857 (7,652 ) 22,588 10,009
Noninterest Expense
Salaries and employee benefits 23,359 20,346 19,690 22,562 18,178 85,957 84,374
Occupancy and equipment 3,698 3,371 3,534 3,793 3,701 14,396 14,606
Professional services 2,523 2,494 2,291 2,261 2,130 9,569 9,207
FDIC deposit insurance 1,162 912 943 977 485 3,994 2,258
Data processing 1,646 1,422 1,473 1,435 1,421 5,976 5,595
Depreciation and amortization 1,491 1,482 1,482 1,510 1,535 5,965 5,930
Other real estate owned/foreclosure expense 105 185 150 165 35 605 294
Other operating expenses 6,751 6,176 5,547 6,453 6,257 24,927 21,428
Total noninterest expense 40,735 36,388 35,110 39,156 33,742 151,389 143,692
Income Before Provision for Income Taxes 11,754 10,752 11,872 5,455 12,819 39,833 104,852
Provision for Income Taxes 3,655 2,917 3,186 1,411 2,570 11,169 27,907
Net Income $ 8,099 $ 7,835 $ 8,686 $ 4,044 $ 10,249 $ 28,664 $ 76,945
Basic earnings per common share $ 0.27 $ 0.26 $ 0.29 $ 0.13 $ 0.34 $ 0.96 $ 2.50
Diluted earnings per common share $ 0.27 $ 0.26 $ 0.29 $ 0.13 $ 0.34 $ 0.96 $ 2.50
Dividends per common share $ 0.22 $ 0.22 $ 0.22 $ 0.22 $ 0.22 $ 0.88 $ 0.88
Basic average shares 29,650 29,703 30,090 30,265 30,420 29,925 30,823
Diluted average shares 29,650 29,703 30,090 30,265 30,420 29,925 30,823
Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 8
--- ---

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(Unaudited)

September 30, June 30, March 31, December 31,
(Dollars in thousands) 2023 2023 2023 2022
ASSETS
Cash and due from banks 172,157 $ 200,926 $ 160,053 $ 176,747 $ 151,754
Securities held-to-maturity:
Mortgage-backed securities 7,855 7,860 7,865 7,870 7,875
Other securities, net 65,068 65,271 65,469 65,653 65,836
Securities available for sale:
Mortgage-backed securities 354,344 337,879 365,911 380,110 384,283
Other securities 520,409 505,784 503,645 431,818 351,074
Loans 6,906,950 6,896,074 6,832,425 6,904,176 6,934,769
Allowance for credit losses (40,161 ) (39,228 ) (38,593 ) (38,729 ) (40,442 )
Net loans 6,866,789 6,856,846 6,793,832 6,865,447 6,894,327
Interest and dividends receivable 59,018 55,660 52,911 46,836 45,048
Bank premises and equipment, net 21,273 21,302 22,182 21,567 21,750
Federal Home Loan Bank of New York stock 31,066 43,821 36,168 38,779 45,842
Bank owned life insurance 213,518 214,321 213,164 214,240 213,131
Goodwill 17,636 17,636 17,636 17,636 17,636
Core deposit intangibles 1,537 1,651 1,769 1,891 2,017
Right of use asset 39,557 41,404 41,526 42,268 43,289
Other assets 167,009 209,014 192,721 168,872 179,084
Total assets 8,537,236 $ 8,579,375 $ 8,474,852 $ 8,479,734 $ 8,422,946
LIABILITIES
Total deposits 6,815,261 $ 6,681,509 $ 6,723,690 $ 6,734,090 $ 6,485,342
Borrowed funds 841,281 1,001,010 857,400 887,509 1,052,973
Operating lease liability 40,822 43,067 44,402 45,353 46,125
Other liabilities 170,035 187,268 179,113 140,437 161,349
Total liabilities 7,867,399 7,912,854 7,804,605 7,807,389 7,745,789
STOCKHOLDERS' EQUITY
Preferred stock (5,000,000 shares authorized; none issued) — — — — —
Common stock (0.01 par value; 100,000,000 shares authorized) 341 341 341 341 341
Additional paid-in capital 264,534 264,486 263,744 262,876 264,332
Treasury stock (106,070 ) (105,433 ) (104,574 ) (97,760 ) (98,535 )
Retained earnings 549,683 548,058 546,755 544,672 547,507
Accumulated other comprehensive loss, net of taxes (38,651 ) (40,931 ) (36,019 ) (37,784 ) (36,488 )
Total stockholders' equity 669,837 666,521 670,247 672,345 677,157
Total liabilities and stockholders' equity 8,537,236 $ 8,579,375 $ 8,474,852 $ 8,479,734 $ 8,422,946
(In thousands)
Issued shares 34,088 34,088 34,088 34,088 34,088
Outstanding shares 28,866 28,905 28,961 29,488 29,476
Treasury shares 5,222 5,183 5,127 4,600 4,612

All values are in US Dollars.

Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 9

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

AVERAGE BALANCE SHEETS

(Unaudited)

For the three months ended For the year ended
December 31, September 30, June 30, March 31, December 31, December 31, December 31,
(In thousands) 2023 2023 2023 2023 2022 2023 2022
Interest-earning Assets:
Mortgage loans, net $ 5,356,112 $ 5,314,215 $ 5,308,567 $ 5,333,274 $ 5,338,612 $ 5,328,067 $ 5,253,104
Commercial Business loans, net 1,511,815 1,498,804 1,521,081 1,537,918 1,542,633 1,517,282 1,488,486
Total loans, net 6,867,927 6,813,019 6,829,648 6,871,192 6,881,245 6,845,349 6,741,590
Taxable securities:
Mortgage-backed securities 426,612 436,181 448,620 457,911 549,204 442,228 573,314
Other securities, net 527,316 528,091 471,600 411,723 371,897 485,118 324,112
Total taxable securities 953,928 964,272 920,220 869,634 921,101 927,346 897,426
Tax-exempt securities:
Other securities 66,242 66,438 66,632 66,828 67,022 66,533 64,822
Total tax-exempt securities 66,242 66,438 66,632 66,828 67,022 66,533 64,822
Interest-earning deposits and federal funds sold 188,894 179,508 175,256 194,722 176,323 184,565 131,816
Total interest-earning assets 8,076,991 8,023,237 7,991,756 8,002,376 8,045,691 8,023,793 7,835,654
Other assets 492,011 482,109 470,686 465,941 472,328 477,771 471,483
Total assets $ 8,569,002 $ 8,505,346 $ 8,462,442 $ 8,468,317 $ 8,518,019 $ 8,501,564 $ 8,307,137
Interest-bearing Liabilities:
Deposits:
Savings accounts $ 110,316 $ 115,437 $ 124,041 $ 134,945 $ 146,598 $ 121,102 $ 153,605
NOW accounts 1,848,285 1,907,781 2,026,950 1,970,555 1,972,134 1,937,974 1,976,238
Money market accounts 1,625,453 1,584,308 1,754,574 2,058,523 2,146,649 1,754,059 2,191,768
Certificate of deposit accounts 2,340,115 2,290,669 2,046,960 1,679,517 1,350,683 2,091,677 1,031,024
Total due to depositors 5,924,169 5,898,195 5,952,525 5,843,540 5,616,064 5,904,812 5,352,635
Mortgagors' escrow accounts 86,592 69,525 97,410 70,483 82,483 81,015 80,021
Total interest-bearing deposits 6,010,761 5,967,720 6,049,935 5,914,023 5,698,547 5,985,827 5,432,656
Borrowings 803,148 804,140 706,924 789,535 963,662 776,050 1,012,149
Total interest-bearing liabilities 6,813,909 6,771,860 6,756,859 6,703,558 6,662,209 6,761,877 6,444,805
Noninterest-bearing demand deposits 873,276 851,677 849,682 896,462 979,836 867,667 1,019,090
Other liabilities 211,998 206,768 183,066 185,239 199,809 196,869 170,500
Total liabilities 7,899,183 7,830,305 7,789,607 7,785,259 7,841,854 7,826,413 7,634,395
Equity 669,819 675,041 672,835 683,058 676,165 675,151 672,742
Total liabilities and equity $ 8,569,002 $ 8,505,346 $ 8,462,442 $ 8,468,317 $ 8,518,019 $ 8,501,564 $ 8,307,137
Net interest-earning assets $ 1,263,082 $ 1,251,377 $ 1,234,897 $ 1,298,818 $ 1,383,482 $ 1,261,916 $ 1,390,849
Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 10
--- ---

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

NET INTEREST INCOME AND NET INTEREST MARGIN

(Unaudited)

For the three months ended For the year ended
December 31, September 30, June 30, March 31, December 31, December 31, December 31,
(Dollars in thousands) 2023 2023 2023 2023 2022 2023 2022
Interest Income:
Mortgage loans, net $ 72,505 $ 68,931 $ 63,688 $ 62,054 $ 60,946 $ 267,178 $ 228,065
Commercial Business loans, net 23,111 22,535 21,689 20,835 20,087 88,170 65,222
Total loans, net 95,616 91,466 85,377 82,889 81,033 355,348 293,287
Taxable securities:
Mortgage-backed securities 3,217 3,031 2,976 2,281 2,425 11,505 9,414
Other securities 7,239 7,003 5,847 4,611 3,723 24,700 9,771
Total taxable securities 10,456 10,034 8,823 6,892 6,148 36,205 19,185
Tax-exempt securities:
Other securities 482 484 480 477 489 1,923 2,197
Total tax-exempt securities 482 484 480 477 489 1,923 2,197
Interest-earning deposits and federal funds sold 2,310 2,154 1,982 1,959 1,702 8,405 2,418
Total interest-earning assets 108,864 104,138 96,662 92,217 89,372 401,881 317,087
Interest Expense:
Deposits:
Savings accounts $ 124 $ 130 $ 140 $ 126 $ 59 $ 520 $ 211
NOW accounts 17,411 16,843 16,152 13,785 9,515 64,191 15,353
Money market accounts 15,785 14,386 14,625 14,102 10,532 58,898 19,039
Certificate of deposit accounts 19,917 18,639 15,281 11,007 7,037 64,844 12,547
Total due to depositors 53,237 49,998 46,198 39,020 27,143 188,453 47,150
Mortgagors' escrow accounts 47 68 51 36 83 202 135
Total interest-bearing deposits 53,284 50,066 46,249 39,056 27,226 188,655 47,285
Borrowings 9,394 9,543 6,934 7,799 7,843 33,670 25,725
Total interest-bearing liabilities 62,678 59,609 53,183 46,855 35,069 222,325 73,010
Net interest income- tax equivalent $ 46,186 $ 44,529 $ 43,479 $ 45,362 $ 54,303 $ 179,556 $ 244,077
Included in net interest income above:
Prepayment penalty income, net reversals and recovered interest from nonaccrual loans, and customer swap terminations fees $ 3,416 $ 857 $ 315 $ 680 $ 1,080 $ 5,268 $ 6,445
Net gains/(losses) from fair value adjustments on qualifying hedges included in net interest income (872 ) 1,348 (205 ) 100 936 371 775
Purchase accounting adjustments 461 347 340 306 342 1,454 2,542
Interest-earning Assets Yields:
Mortgage loans, net 5.41 % 5.19 % 4.80 % 4.65 % 4.57 % 5.01 % 4.34 %
Commercial Business loans, net 6.11 6.01 5.70 5.42 5.21 5.81 4.38
Total loans, net 5.57 5.37 5.00 4.83 4.71 5.19 4.35
Taxable securities:
Mortgage-backed securities 3.02 2.78 2.65 1.99 1.77 2.60 1.64
Other securities 5.49 5.30 4.96 4.48 4.00 5.09 3.01
Total taxable securities 4.38 4.16 3.84 3.17 2.67 3.90 2.14
Tax-exempt securities: ^(1)^
Other securities 2.91 2.91 2.88 2.86 2.92 2.89 3.39
Total tax-exempt securities 2.91 2.91 2.88 2.86 2.92 2.89 3.39
Interest-earning deposits and federal funds sold 4.89 4.80 4.52 4.02 3.86 4.55 1.83
Total interest-earning assets^(1)^ 5.39 % 5.19 % 4.84 % 4.61 % 4.44 % 5.01 % 4.05 %
Interest-bearing Liabilities Yields:
Deposits:
Savings accounts 0.45 % 0.45 % 0.45 % 0.37 % 0.16 % 0.43 % 0.14 %
NOW accounts 3.77 3.53 3.19 2.80 1.93 3.31 0.78
Money market accounts 3.88 3.63 3.33 2.74 1.96 3.36 0.87
Certificate of deposit accounts 3.40 3.25 2.99 2.62 2.08 3.10 1.22
Total due to depositors 3.59 3.39 3.10 2.67 1.93 3.19 0.88
Mortgagors' escrow accounts 0.22 0.39 0.21 0.20 0.40 0.25 0.17
Total interest-bearing deposits 3.55 3.36 3.06 2.64 1.91 3.15 0.87
Borrowings 4.68 4.75 3.92 3.95 3.26 4.34 2.54
Total interest-bearing liabilities 3.68 % 3.52 % 3.15 % 2.80 % 2.11 % 3.29 % 1.13 %
Net interest rate spread (tax equivalent)^^^(1)^ 1.71 % 1.67 % 1.69 % 1.81 % 2.33 % 1.72 % 2.92 %
Net interest margin (tax equivalent)^(1)^ 2.29 % 2.22 % 2.18 % 2.27 % 2.70 % 2.24 % 3.11 %
Ratio of interest-earning assets to interest-bearing liabilities 1.19 X 1.18 X 1.18 X 1.19 X 1.21 X 1.19 X 1.22 X
^(1)^ Yields are calculated on the tax equivalent basis using the statutory federal income tax rate of 21% for the periods presented.
Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 11
--- ---

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

DEPOSIT and LOAN COMPOSITION

(Unaudited)

Deposit Composition

4Q23 vs. 4Q23 vs.
December 31, September 30, June 30, March 31, December 31, 3Q23 4Q22
(Dollars in thousands) 2023 2023 2023 2023 2022 % Change % Change
Noninterest bearing $ 847,416 $ 874,420 $ 827,820 $ 872,254 $ 921,238 (3.1 )% (8.0 )%
Interest bearing:
Certificate of deposit accounts 2,311,290 2,321,369 2,232,696 1,880,260 1,526,338 (0.4 ) 51.4
Savings accounts 108,605 112,730 118,886 128,245 143,641 (3.7 ) (24.4 )
Money market accounts 1,726,404 1,551,176 1,594,637 1,855,781 2,099,776 11.3 (17.8 )
NOW accounts 1,771,164 1,749,802 1,891,834 1,918,977 1,746,190 1.2 1.4
Total interest-bearing deposits 5,917,463 5,735,077 5,838,053 5,783,263 5,515,945 3.2 7.3
Total due to depositors 6,764,879 6,609,497 6,665,873 6,655,517 6,437,183 2.4 5.1
Mortgagors' escrow deposits 50,382 72,012 57,817 78,573 48,159 (30.0 ) 4.6
Total deposits $ 6,815,261 $ 6,681,509 $ 6,723,690 $ 6,734,090 $ 6,485,342 2.0 % 5.1 %

Loan Composition

4Q23 vs. 4Q23 vs.
December 31, September 30, June 30, March 31, December 31, 3Q23 4Q22
(Dollars in thousands) 2023 2023 2023 2023 2022 % Change % Change
Multifamily residential $ 2,658,205 $ 2,614,219 $ 2,593,955 $ 2,601,174 $ 2,601,384 1.7 % 2.2 %
Commercial real estate 1,958,252 1,953,243 1,917,749 1,904,293 1,913,040 0.3 2.4
One-to-four family ― mixed use property 530,243 537,744 542,368 549,207 554,314 (1.4 ) (4.3 )
One-to-four family ― residential 220,213 222,874 230,055 238,417 241,246 (1.2 ) (8.7 )
Construction 58,673 59,903 57,325 60,486 70,951 (2.1 ) (17.3 )
Mortgage loans 5,425,586 5,387,983 5,341,452 5,353,577 5,380,935 0.7 0.8
Small Business Administration 20,205 21,896 22,404 22,860 23,275 (7.7 ) (13.2 )
Commercial business and other 1,452,518 1,487,775 1,466,358 1,518,756 1,521,548 (2.4 ) (4.5 )
Commercial Business loans 1,472,723 1,509,671 1,488,762 1,541,616 1,544,823 (2.4 ) (4.7 )
Gross loans 6,898,309 6,897,654 6,830,214 6,895,193 6,925,758 — (0.4 )
Net unamortized (premiums) and unearned loan (cost) fees ^(1)^ 8,641 (1,580 ) 2,211 8,983 9,011 (646.9 ) (4.1 )
Allowance for credit losses (40,161 ) (39,228 ) (38,593 ) (38,729 ) (40,442 ) 2.4 (0.7 )
Net loans $ 6,866,789 $ 6,856,846 $ 6,793,832 $ 6,865,447 $ 6,894,327 0.1 % (0.4 )%
^(1)^ Includes $3.9 million, $4.4 million, $4.8 million, $5.1 million, and $5.4 million, of purchase accounting unamortized discount resulting from the acquisition of Empire Bancorp at December 31, 2023, September 30,<br> 2023, June 30, 2023, March 31, 2023, and December 31, 2022, respectively.
Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 12
--- ---

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

LOAN CLOSINGS and RATES

(Unaudited)

Loan Closings

For the three months ended For the year ended
December 31, September 30, June 30, March 31, December 31, December 31, December 31,
(In thousands) 2023 2023 2023 2023 2022 2023 2022
Multifamily residential $ 82,995 $ 75,655 $ 31,901 $ 42,164 $ 65,347 $ 232,715 $ 474,409
Commercial real estate 60,092 70,197 38,523 15,570 20,750 184,382 308,455
One-to-four family – mixed use property 3,319 6,028 5,812 4,938 4,489 20,097 37,598
One-to-four family – residential 1,454 1,070 63 4,296 7,485 6,883 25,059
Construction 8,007 6,971 8,811 10,592 7,301 34,381 31,592
Mortgage loans 155,867 159,921 85,110 77,560 105,372 478,458 877,113
Small Business Administration 1,162 — 820 318 665 2,300 3,461
Commercial business and other 87,255 81,549 72,850 95,668 119,191 337,322 641,420
Commercial Business loans 88,417 81,549 73,670 95,986 119,856 339,622 644,881
Total Closings $ 244,284 $ 241,470 $ 158,780 $ 173,546 $ 225,228 $ 818,080 $ 1,521,994

Weighted Average Rate on Loan Closings

For the three months ended
December 31, September 30, June 30, March 31, December 31,
Loan type 2023 2023 2023 2023 2022
Mortgage loans 7.55 % 7.22 % 6.62 % 6.30 % 5.59 %
Commercial Business loans 7.93 8.00 7.76 7.58 6.57
Total loans 7.69 % 7.48 % 7.14 % 7.01 % 6.10 %
Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 13
--- ---

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

ASSET QUALITY

(Unaudited)

Allowance for Credit Losses

For the three months ended For the year ended
December 31, September 30, June 30, March 31, December 31, December 31, December 31,
(Dollars in thousands) 2023 2023 2023 2023 2022 2023 2022
Allowance for credit losses - loans
Beginning balances $ 39,228 $ 38,593 $ 38,729 $ 40,442 $ 41,268 $ 40,442 $ 37,135
Net loan charge-off (recoveries):
Multifamily residential (1 ) — — (1 ) 132 (2 ) 131
Commercial real estate — — 8 — — 8 —
One-to-four family – mixed-use property (1 ) — — — — (1 ) —
One-to-four family – residential 9 (6 ) 4 (36 ) 17 (29 ) 15
Small Business Administration (29 ) (48 ) (158 ) (6 ) (9 ) (241 ) 1,007
Taxi medallion — — — — — — (447 )
Commercial business and other 82 12 1,706 9,277 671 11,077 829
Total net loan charge-offs (recoveries) 60 (42 ) 1,560 9,234 811 10,812 1,535
Provision (benefit) for loan losses 993 593 1,424 7,521 (15 ) 10,531 4,842
Ending balance $ 40,161 $ 39,228 $ 38,593 $ 38,729 $ 40,442 $ 40,161 $ 40,442
Gross charge-offs $ 107 $ 21 $ 1,731 $ 9,298 $ 1,938 $ 11,157 $ 3,348
Gross recoveries 47 63 171 64 1,127 345 1,813
Allowance for credit losses - loans to gross loans 0.58 % 0.57 % 0.57 % 0.56 % 0.58 % 0.58 % 0.58 %
Net loan charge-offs (recoveries) to average loans — — 0.09 0.54 0.05 0.16 0.02

Nonperforming Assets

December 31, September 30, June 30, March 31, December 31,
(Dollars in thousands) 2023 2023 2023 2023 2022
Loans 90 Days or More Past Due and Still Accruing:
Multifamily residential $ 1,463 $ — $ — $ — $ —
Construction — — — — 2,600
Total Loans 90 Days or more past due and still accruing 1,463 — — — 2,600
Nonaccrual Loans:
Multifamily residential 3,206 3,206 3,206 3,628 3,206
Commercial real estate — — — — 237
One-to-four family - mixed-use property^(1)^ 981 1,075 790 790 790
One-to-four family - residential 5,181 4,161 5,218 4,961 4,425
Small Business Administration 2,552 1,255 1,119 937 937
Commercial business and other^(1)^ 11,789 7,708 8,304 10,860 20,187
Total Nonaccrual loans 23,709 17,405 18,637 21,176 29,782
Total Nonperforming Loans (NPLs) 25,172 17,405 18,637 21,176 32,382
Total Nonaccrual HTM Securities 20,981 20,981 20,981 20,981 20,981
Total Nonperforming Assets $ 46,153 $ 38,386 $ 39,618 $ 42,157 $ 53,363
Nonperforming Assets to Total Assets 0.54 % 0.45 % 0.47 % 0.50 % 0.63 %
Allowance for Credit Losses to NPLs 159.5 % 225.4 % 207.1 % 182.9 % 124.9 %
^(1)^ Adopted ASU No. 2022-02 Financial Instruments – Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures on January 1, 2023; Not included in the above analysis<br> are nonaccrual performing TDR one-to-four family – mixed use property loans totaling $0.2 million in 4Q22; nonaccrual performing TDR commercial business loans totaling less than $0.1 million in 4Q22.
Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 14
--- ---

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

RECONCILIATION OF GAAP EARNINGS and CORE EARNINGS

Non-cash Fair Value Adjustments to GAAP Earnings

The variance in GAAP and core earnings is partly driven by the impact of non-cash net gains and losses from fair value adjustments. These fair value adjustments relate primarily to borrowings carried at fair value under the fair value option.

Core Net Income, Core Diluted EPS, Core ROAE, Core ROAA, Pre-provision Pre-tax Net Revenue, Core Net Interest Income FTE, Core Net Interest Margin FTE, Core Interest Income and Yield on Total Loans, Core Noninterest Income, Core Noninterest Expense and Tangible Book Value per common share are each non-GAAP measures used in this release. A reconciliation to the most directly comparable GAAP financial measures appears below in tabular form. The Company believes that these measures are useful for both investors and management to understand the effects of certain interest and noninterest items and provide an alternative view of the Company’s performance over time and in comparison, to the Company’s competitors. These measures should not be viewed as a substitute for net income. The Company believes that tangible book value per common share is useful for both investors and management as this measure is commonly used by financial institutions, regulators, and investors to measure the capital adequacy of financial institutions. The Company believes these measures facilitate comparison of the quality and composition of the Company’s capital over time and in comparison, to its competitors. These measures should not be viewed as a substitute for total shareholders’ equity.

These non-GAAP measures have inherent limitations, are not required to be uniformly applied and are not audited. They should not be considered in isolation or as a substitute for analysis of results reported under GAAP. These non-GAAP measures may not be comparable to similarly titled measures reported by other companies.

Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 15

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

RECONCILIATION OF GAAP EARNINGS and CORE EARNINGS

(Unaudited)

For the three months ended For the year ended
(Dollars in thousands, December 31, September 30, June 30, March 31, December 31, December 31, December 31,
except per share data) 2023 2023 2023 2023 2022 2023 2022
GAAP income before income taxes $ 11,754 $ 10,752 $ 11,872 $ 5,455 $ 12,819 $ 39,833 $ 104,852
Net (gain) loss from fair value adjustments (Noninterest income (loss)) (906 ) 1,246 (294 ) (2,619 ) 622 (2,573 ) (5,728 )
Net loss on sale of securities (Noninterest income (loss)) — — — — 10,948 — 10,948
Life insurance proceeds (Noninterest income (loss)) (697 ) (23 ) (561 ) — (286 ) (1,281 ) (1,822 )
Net gain on disposition of assets (Noninterest income (loss)) — — — — (104 ) — (104 )
Net (gain) loss from fair value adjustments on qualifying hedges (Net interest income) 872 (1,348 ) 205 (100 ) (936 ) (371 ) (775 )
Net amortization of purchase accounting adjustments and intangibles (Various) (355 ) (237 ) (227 ) (188 ) (219 ) (1,007 ) (2,030 )
Miscellaneous expense  (Professional services) 526 — — — — 526 —
Core income before taxes 11,194 10,390 10,995 2,548 22,844 35,127 105,341
Provision for core income taxes 3,648 2,819 3,083 659 5,445 10,209 28,502
Core net income $ 7,546 $ 7,571 $ 7,912 $ 1,889 $ 17,399 $ 24,918 $ 76,839
GAAP diluted earnings per common share $ 0.27 $ 0.26 $ 0.29 $ 0.13 $ 0.34 $ 0.96 $ 2.50
Net (gain) loss from fair value adjustments, net of tax (0.02 ) 0.03 (0.01 ) (0.06 ) 0.02 (0.06 ) (0.14 )
Net loss on sale of securities, net of tax — — — — 0.27 — 0.26
Life insurance proceeds (0.02 ) — (0.02 ) — (0.01 ) (0.04 ) (0.06 )
Net (gain) loss from fair value adjustments on qualifying hedges, net of tax 0.02 (0.03 ) — — (0.02 ) (0.01 ) (0.02 )
Net amortization of purchase accounting adjustments, net of tax (0.01 ) (0.01 ) (0.01 ) (0.01 ) (0.01 ) (0.02 ) (0.05 )
Miscellaneous expense, net of tax 0.01 — — — — 0.01 —
Core diluted earnings per common share^(1)^ $ 0.25 $ 0.25 $ 0.26 $ 0.06 $ 0.57 $ 0.83 $ 2.49
Core net income, as calculated above $ 7,546 $ 7,571 $ 7,912 $ 1,889 $ 17,399 $ 24,918 $ 76,839
Average assets 8,569,002 8,505,346 8,462,442 8,468,317 8,518,019 8,501,564 8,307,137
Average equity 669,819 675,041 672,835 683,058 676,165 675,151 672,742
Core return on average assets^(2)^ 0.35 % 0.36 % 0.37 % 0.09 % 0.82 % 0.29 % 0.92 %
Core return on average equity^(2)^ 4.51 % 4.49 % 4.70 % 1.11 % 10.29 % 3.69 % 11.42 %
^(1)^ Core diluted earnings per common share may not foot due to rounding.
^(2)^ Ratios are calculated on an annualized basis.
--- ---
Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 16
--- ---

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

RECONCILIATION OF GAAP REVENUE and PRE-PROVISION

PRE-TAX NET REVENUE

(Unaudited)

For the three months ended For the year ended
December 31, September 30, June 30, March 31, December 31, December 31, December 31,
(Dollars in thousands) 2023 2023 2023 2023 2022 2023 2022
GAAP Net interest income $ 46,085 $ 44,427 $ 43,378 $ 45,262 $ 54,201 $ 179,152 $ 243,616
Net (gain) loss from fair value adjustments on qualifying hedges 872 (1,348 ) 205 (100 ) (936 ) (371 ) (775 )
Net amortization of purchase accounting adjustments (461 ) (347 ) (340 ) (306 ) (342 ) (1,454 ) (2,542 )
Core Net interest income $ 46,496 $ 42,732 $ 43,243 $ 44,856 $ 52,923 $ 177,327 $ 240,299
GAAP Noninterest income (loss) $ 7,402 $ 3,309 $ 5,020 $ 6,857 $ (7,652 ) $ 22,588 $ 10,009
Net (gain) loss from fair value adjustments (906 ) 1,246 (294 ) (2,619 ) 622 (2,573 ) (5,728 )
Net loss on sale of securities — — — — 10,948 — 10,948
Life insurance proceeds (697 ) (23 ) (561 ) — (286 ) (1,281 ) (1,822 )
Net gain on sale of assets — — — — (104 ) — (104 )
Core Noninterest income $ 5,799 $ 4,532 $ 4,165 $ 4,238 $ 3,528 $ 18,734 $ 13,303
GAAP Noninterest expense $ 40,735 $ 36,388 $ 35,110 $ 39,156 $ 33,742 $ 151,389 $ 143,692
Net amortization of purchase accounting adjustments (106 ) (110 ) (113 ) (118 ) (123 ) (447 ) (512 )
Miscellaneous expense (526 ) — — — — (526 ) —
Core Noninterest expense $ 40,103 $ 36,278 $ 34,997 $ 39,038 $ 33,619 $ 150,416 $ 143,180
Net interest income $ 46,085 $ 44,427 $ 43,378 $ 45,262 $ 54,201 $ 179,152 $ 243,616
Noninterest income (loss) 7,402 3,309 5,020 6,857 (7,652 ) 22,588 10,009
Noninterest expense (40,735 ) (36,388 ) (35,110 ) (39,156 ) (33,742 ) (151,389 ) (143,692 )
Pre-provision pre-tax net revenue $ 12,752 $ 11,348 $ 13,288 $ 12,963 $ 12,807 $ 50,351 $ 109,933
Core:
Net interest income $ 46,496 $ 42,732 $ 43,243 $ 44,856 $ 52,923 $ 177,327 $ 240,299
Noninterest income 5,799 4,532 4,165 4,238 3,528 18,734 13,303
Noninterest expense (40,103 ) (36,278 ) (34,997 ) (39,038 ) (33,619 ) (150,416 ) (143,180 )
Pre-provision pre-tax net revenue $ 12,192 $ 10,986 $ 12,411 $ 10,056 $ 22,832 $ 45,645 $ 110,422
Efficiency Ratio 76.7 % 76.8 % 73.8 % 79.5 % 59.6 % 76.7 % 56.5 %
Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 17
--- ---

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

RECONCILIATION OF GAAP NET INTEREST INCOME and NET INTEREST MARGIN

to CORE NET INTEREST INCOME

(Unaudited)

For the three months ended For the year ended
December 31, September 30, June 30, March 31, December 31, December 31, December 31,
(Dollars in thousands) 2023 2023 2023 2023 2022 2023 2022
GAAP net interest income $ 46,085 $ 44,427 $ 43,378 $ 45,262 $ 54,201 $ 179,152 $ 243,616
Net (gain) loss from fair value adjustments on qualifying hedges 872 (1,348 ) 205 (100 ) (936 ) (371 ) (775 )
Net amortization of purchase accounting adjustments (461 ) (347 ) (340 ) (306 ) (342 ) (1,454 ) (2,542 )
Tax equivalent adjustment 101 102 101 100 102 404 461
Core net interest income FTE $ 46,597 $ 42,834 $ 43,344 $ 44,956 $ 53,025 $ 177,731 $ 240,760
Total average interest-earning assets ^(1)^ $ 8,080,550 $ 8,027,201 $ 7,996,067 $ 8,006,970 $ 8,050,601 $ 8,027,898 $ 7,841,407
Core net interest margin FTE 2.31 % 2.13 % 2.17 % 2.25 % 2.63 % 2.21 % 3.07 %
GAAP interest income on total loans, net $ 95,616 $ 91,466 $ 85,377 $ 82,889 $ 81,033 $ 355,348 $ 293,287
Net (gain) loss from fair value adjustments on qualifying hedges - loans 978 (1,379 ) 157 (101 ) (936 ) (345 ) (775 )
Net amortization of purchase accounting adjustments (484 ) (358 ) (345 ) (316 ) (372 ) (1,503 ) (2,628 )
Core interest income on total loans, net $ 96,110 $ 89,729 $ 85,189 $ 82,472 $ 79,725 $ 353,500 $ 289,884
Average total loans, net ^(1)^ $ 6,872,115 $ 6,817,642 $ 6,834,644 $ 6,876,495 $ 6,886,900 $ 6,850,124 $ 6,748,165
Core yield on total loans 5.59 % 5.26 % 4.99 % 4.80 % 4.63 % 5.16 % 4.30 %
^(1)^ Excludes purchase accounting average balances for all periods presented.
Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 18
--- ---

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

CALCULATION OF TANGIBLE STOCKHOLDERS’

COMMON EQUITY to TANGIBLE ASSETS

(Unaudited)

December 31, September 30, June 30, March 31, December 31,
(Dollars in thousands) 2023 2023 2023 2023 2022
Total Equity $ 669,837 $ 666,521 $ 670,247 $ 672,345 $ 677,157
Less:
Goodwill (17,636 ) (17,636 ) (17,636 ) (17,636 ) (17,636 )
Core deposit intangibles (1,537 ) (1,651 ) (1,769 ) (1,891 ) (2,017 )
Tangible Stockholders' Common Equity $ 650,664 $ 647,234 $ 650,842 $ 652,818 $ 657,504
Total Assets $ 8,537,236 $ 8,579,375 $ 8,474,852 $ 8,479,734 $ 8,422,946
Less:
Goodwill (17,636 ) (17,636 ) (17,636 ) (17,636 ) (17,636 )
Core deposit intangibles (1,537 ) (1,651 ) (1,769 ) (1,891 ) (2,017 )
Tangible Assets $ 8,518,063 $ 8,560,088 $ 8,455,447 $ 8,460,207 $ 8,403,293
Tangible Stockholders' Common Equity to Tangible Assets 7.64 % 7.56 % 7.70 % 7.72 % 7.82 %
Investor Contact: Susan K. Cullen, SEVP, CFO and Treasurer, 718-961-5400 19
--- ---

Report a Problem

Category
Description
Email (optional, for follow-up)