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Dime Community Bancshares, Inc. Reports Strong Third Quarter 2022 Results With Earnings Per Share Increasing By 10% On a Year-Over-Year Basis
Источник: Nasdaq GlobeNewswire / 28 окт 2022 06:00:01 America/New_York
Robust Quarterly Loan Originations and Net Interest Margin Expansion Drive Net Interest Income Growth
Deposit Costs Remain Well Controlled
HAUPPAUGE, N.Y., Oct. 28, 2022 (GLOBE NEWSWIRE) -- Dime Community Bancshares, Inc. (NASDAQ: DCOM) (the “Company” or “Dime”), the parent company of Dime Community Bank (the “Bank”), today reported net income available to common stockholders of $37.7 million for the quarter ended September 30, 2022, or $0.98 per diluted common share, compared to $36.7 million, or $0.94 per diluted common share, for the quarter ended June 30, 2022, and $36.6 million, or $0.89 per diluted common share, for the quarter ended September 30, 2021.
Kevin M. O’Connor, Chief Executive Officer (“CEO”) of the Company, stated, “During the third quarter, we had robust loan originations resulting in another quarter of record loan growth of over $450 million. The high level of non-interest-bearing deposits on our balance sheet allowed us to keep our deposit costs well contained. Strong growth in average earning assets and net interest margin expansion resulted in quarterly net interest income surpassing $100 million. We continue to prioritize prudent expense management as demonstrated by a core efficiency ratio of 47% on a year-to-date basis.”
Highlights for the Third Quarter of 2022 Included:
- Total loans held for investment, net, excluding Paycheck Protection Program (“PPP”) loans, increased by 19% on an annualized basis versus the linked quarter;
- The net interest margin expanded by 9 basis points versus the linked quarter;
- The cost of deposits remained well-controlled; on a linked quarter basis, the cost of deposits increased by only 23 basis points compared to the 150 basis points change in the Federal Funds rate between July and September;
- Credit quality continues to be strong with non-performing assets and loans 90 days past due and accruing remaining stable and representing only 0.34% of total assets as of September 30, 2022; and
- The Company repurchased 200,346 shares of its common stock, which represented approximately 0.5% of shares outstanding at the beginning of the period, at a weighted-average price of $30.97 per share.
Management’s Discussion of Quarterly Operating Results
Net Interest Income
Net interest income for the third quarter of 2022 was $100.4 million compared to $93.5 million for the second quarter of 2022 and $94.8 million for the third quarter of 2021.
The table below provides a reconciliation of the reported net interest margin (“NIM”) and adjusted NIM excluding the impact of purchase accounting accretion on the loan portfolio.
(Dollars in thousands) Q3 2022 Q2 2022 Q3 2021 Net interest income $ 100,438 $ 93,512 $ 94,828 Purchase accounting accretion on loans ("PAA") (57 ) 117 (2,541 ) Adjusted net interest income excluding PAA on loans (non-GAAP) $ 100,381 $ 93,629 $ 92,287 Average interest-earning assets $ 11,782,361 $ 11,412,350 $ 11,765,298 NIM (1) 3.38 % 3.29 % 3.20 % Adjusted NIM excluding PAA on loans (non-GAAP) (2) 3.38 % 3.29 % 3.11 % (1) NIM represents net interest income divided by average interest-earning assets.
(2) Adjusted NIM excluding PAA on loans represents adjusted net interest income, which excludes net interest income on PAA loans divided by average interest-earning assets.Loan Portfolio
The ending weighted average rate (“WAR”)(1) on the total loan portfolio was 4.33% at September 30, 2022, a 39 basis point increase compared to the ending WAR on the total loan portfolio at June 30, 2022.
Outlined below are loan balances and WARs for the period ended as indicated.
September 30, 2022 June 30, 2022 September 30, 2021 ($ in thousands) Balance WAR Balance WAR Balance WAR Loans held for investment balances at period end: Commercial and industrial ("C&I") $ 900,768 5.90 % $ 941,944 4.97 % $ 878,332 4.10 % Owner-occupied commercial real estate 1,090,417 4.69 1,043,184 4.20 966,895 4.11 Business loans 1,991,185 5.24 1,985,128 4.57 1,845,227 4.11 One-to-four family residential, including condominium and cooperative apartment 722,081 3.77 691,586 3.60 683,665 3.68 Multifamily residential and residential mixed-use (2)(3) 3,968,244 3.83 3,654,164 3.62 3,468,262 3.57 Non-owner-occupied commercial real estate 3,174,102 4.33 3,048,188 3.89 2,847,793 3.70 Acquisition, development, and construction 241,019 6.75 252,108 5.41 285,379 4.69 Other loans 8,927 7.29 10,789 7.16 20,462 4.97 Loans held for investment, excluding PPP loans 10,105,558 4.33 9,641,963 3.95 9,150,788 3.76 PPP loans 11,383 1.00 18,944 1.00 134,083 1.00 Total loans held for investment, including PPP loans $ 10,116,941 4.33 % $ 9,660,907 3.94 % $ 9,284,871 3.72 % (1) Weighted average rate is calculated by aggregating interest based on the current loan rate from each loan in the category, adjusted for non-accrual loans, divided by the total amount of loans in the category.
(2) Includes loans underlying multifamily cooperatives.
(3) While the loans within this category are often considered "commercial real estate" in nature, multifamily and loans underlying cooperatives are here reported separately from commercial real estate loans in order to emphasize the residential nature of the collateral underlying this significant component of the total loan portfolio.Outlined below are the loan originations, excluding PPP loans, for the quarter ended as indicated.
($ in millions) Q3 2022 Q2 2022 Q3 2021 Loan originations, excluding PPP loans $ 800.9 $ 901.5 $ 464.5
DepositsTotal average deposits for the third quarter were $10.6 billion, compared to $10.3 billion for the second quarter. The cost of deposits increased by 23 basis points on a linked quarter basis. CEO O’Connor stated, “Despite the significant increase in interest rates, we grew average deposit balances on a linked quarter basis, maintained our non-interest bearing deposit ratio at approximately 37% and kept overall deposits costs relatively well-contained.”
Non-Interest Income
Non-interest income was $9.4 million during the third quarter of 2022, $12.1 million during the second quarter of 2022, and $9.7 million during the third quarter of 2021. Included in non-interest income during the third quarter of 2022 was a $1.4 million gain on the sale of a branch property. Included in non-interest income for the second quarter of 2022 was $2.2 million of income related to mortality proceeds from a death claim. Excluding the net gain on sale of securities and other assets, adjusted non-interest income was $8.0 million during the third quarter of 2022 (see “Non-GAAP Reconciliation” tables at the end of this news release).
Non-Interest Expense
Total non-interest expense was $48.3 million during the third quarter of 2022, $51.8 million during the second quarter of 2022, and $56.8 million during the third quarter of 2021. Excluding the impact of merger expenses and transaction costs, branch restructuring, severance expense, loss on extinguishment of debt, and amortization of other intangible assets, adjusted non-interest expense was $47.9 million during the third quarter of 2022, $48.5 million during the second quarter of 2022, and $49.1 million during the third quarter of 2021 (see “Non-GAAP Reconciliation” tables at the end of this news release).
The ratio of non-interest expense to average assets was 1.54% during the third quarter of 2022, compared to 1.71% during the linked quarter and 1.80% for the third quarter of 2021. Excluding the impact of merger expenses and transaction costs, branch restructuring, severance expense, loss on extinguishment of debt, and amortization of other intangible assets, the ratio of adjusted non-interest expense to average assets was 1.53% during the third quarter of 2022, compared to 1.60% during the linked quarter and 1.56% for the third quarter of 2021 (see “Non-GAAP Reconciliation” tables at the end of this news release).
The efficiency ratio was 44.0% during the third quarter of 2022, compared to 49.1% during the linked quarter and 54.3% during the third quarter of 2021. Excluding the impact of merger expenses and transaction costs, branch restructuring, severance expense, loss on extinguishment of debt, amortization of other intangible assets, and gain on sale of securities and other assets, the adjusted efficiency ratio was 44.2% during the third quarter of 2022, compared to 45.9% during the linked quarter and 46.9% during the third quarter of 2021 (see “Non-GAAP Reconciliation” tables at the end of this news release).
Income Tax Expense
The reported effective tax rate for the third quarter of 2022 was 28.1%, compared to 28.4% for the second quarter of 2022, and 27.5% for the third quarter of 2021.
Credit Quality
Non-performing loans at September 30, 2022 were $41.1 million, or 0.41% of total loans.
A credit loss provision of $6.6 million was recorded during the third quarter of 2022, compared to a credit loss provision of $44 thousand during the second quarter of 2022, and a credit loss recovery of $5.2 million during the third quarter of 2021. The credit loss provision for the third quarter was primarily associated with changes to the forecasted macroeconomic conditions used in the Bank’s allowance for credit loss model.
The allowance for credit losses as a percentage of total loans was 0.81% at September 30, 2022 as compared to 0.82% at June 30, 2022 and 0.88% at September 30, 2021.
Capital Management
The Company’s and the Bank’s regulatory capital ratios continued to be in excess of all applicable regulatory requirements as of September 30, 2022.
CEO O’Connor commented, “During the third quarter, we continued to execute on our share repurchase program and we repurchased $6.2 million of common stock. On a year-to-date basis we have repurchased approximately $46.5 million of common stock, representing approximately 4% of shares outstanding at the beginning of the year. Our regulatory capital ratios, which exclude the impact of the accumulated other comprehensive loss component of stockholders’ equity, continue to be very strong. Our solid asset quality metrics and internal stress testing analyses continue to provide support for growing our balance sheet and future capital return to shareholders.”
Dividends per common share were $0.24 during the third quarter of 2022.
Book value per common share was $26.55 at September 30, 2022 compared to $26.41 at June 30, 2022. Tangible common book value per share (which represents common equity less goodwill and other intangible assets, divided by the number of shares outstanding) was $22.34 at September 30, 2022 compared to $22.20 at June 30, 2022. Excluding the impact of AOCI, the adjusted tangible common book value per share was $24.75 at September 30, 2022 compared to $24.01 at June 30, 2022 (see “Non-GAAP Reconciliation” tables at the end of this news release).
Earnings Call Information
The Company will conduct a conference call at 8:30 a.m. (ET) on Friday, October 28, 2022, during which CEO O’Connor will discuss the Company’s third quarter 2022 financial performance, with a question-and-answer session to follow.
The conference call will be simultaneously webcast (listen only) and archived for a period of one year at https://events.q4inc.com/attendee/927279052.
Conference Call Details:
Dial-in for Live Call:
United States:
International:
Access code:1-844-200-6205
+1-929-526-1599
728364Telephone Replay:
A recording will be available until Friday, November 11, 2022.
United States:
International:
Access code:1-866-813-9403
+44-204-525-0658
471079ABOUT DIME COMMUNITY BANCSHARES, INC.
Dime Community Bancshares, Inc. is the holding company for Dime Community Bank, a New York State-chartered trust company with over $12.8 billion in assets and the number one deposit market share among community banks on Greater Long Island(1).(1) Aggregate deposit market share for Kings, Queens, Nassau & Suffolk counties for community banks less than $20 billion in assets.
This news release contains a number of forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These statements may be identified by use of words such as “annualized," “anticipate," "believe," “continue,” "could," "estimate," "expect," "intend," “likely,” "may," "outlook," "plan," "potential," "predict," "project," "should," "will," "would" and similar terms and phrases, including references to assumptions.
Forward-looking statements are based upon various assumptions and analyses made by the Company in light of management's experience and its perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate under the circumstances. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors (many of which are beyond the Company's control) that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Accordingly, you should not place undue reliance on such statements. Factors that could affect our results include, without limitation, the following: the timing and occurrence or non-occurrence of events may be subject to circumstances beyond the Company’s control; there may be increases in competitive pressure among financial institutions or from non-financial institutions; changes in the interest rate environment may affect demand for our products and reduce interest margins and the value of our investments; changes in deposit flows, loan demand or real estate values may adversely affect the business of the Company; changes in the quality and composition of the Company’s loan or investment portfolios or unanticipated or significant increases in loan losses may negatively affect the Company’s financial condition or results of operations; changes in accounting principles, policies or guidelines may cause the Company’s financial condition to be perceived differently; changes in corporate and/or individual income tax laws may adversely affect the Company's financial condition or results of operations; general economic conditions, either nationally or locally in some or all areas in which the Company conducts business, or conditions in the securities markets or the banking industry may be less favorable than the Company currently anticipates; legislation or regulatory changes may adversely affect the Company’s business; technological changes may be more difficult or expensive than the Company anticipates; there may be failures or breaches of information technology security systems; success or consummation of new business initiatives may be more difficult or expensive than the Company anticipates; and litigation or other matters before regulatory agencies, whether currently existing or commencing in the future, may delay the occurrence or non-occurrence of events longer than the Company anticipates. Further, given its ongoing and dynamic nature, it is difficult to predict what effects the COVID-19 pandemic will have on our business and results of operations. The pandemic and related local and national economic disruption may, among other effects, result in a decline in demand for our products and services; increased levels of loan delinquencies, problem assets and foreclosures; branch closures, work stoppages and unavailability of personnel; and increased cybersecurity risks, as employees work remotely. For discussion of these and other risks that may cause actual results to differ from expectations, please refer to the sections entitled “Forward-Looking Statements” and “Risk Factors” in the Company’s most recent Annual Report on Form 10-K and updates set forth in the Company’s subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
Contact: Avinash Reddy Senior Executive Vice President – Chief Financial Officer 718-782-6200 extension 5909 DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(In thousands)September 30, June 30, December 31, 2022 2022 2021 Assets: Cash and due from banks $ 312,996 $ 281,487 $ 393,722 Securities available-for-sale, at fair value 962,927 1,007,757 1,563,711 Securities held-to-maturity 591,403 579,965 179,309 Loans held for sale 289 530 5,493 Loans held for investment, net: C&I 900,768 941,944 867,542 Owner-occupied commercial real estate 1,090,417 1,043,184 1,030,240 Total business loans 1,991,185 1,985,128 1,897,782 One-to-four family and cooperative/condominium apartment 722,081 691,586 669,282 Multifamily residential and residential mixed-use (1)(2) 3,968,244 3,654,164 3,356,346 Non-owner-occupied commercial real estate 3,174,102 3,048,188 2,915,708 Acquisition, development, and construction 241,019 252,108 322,628 Small Business Administration ("SBA") Paycheck Protection Program ("PPP") loans 11,383 18,944 66,017 Other loans 8,927 10,789 16,898 Allowance for credit losses (81,935 ) (79,426 ) (83,853 ) Total loans held for investment, net 10,035,006 9,581,481 9,160,808 Premises and fixed assets, net 47,406 48,686 50,368 Premises held for sale — 556 556 Restricted stock 65,656 42,110 37,732 Bank Owned Life Insurance ("BOLI") 331,105 328,928 295,789 Goodwill 155,797 155,797 155,797 Other intangible assets 6,915 7,346 8,362 Operating lease assets 57,916 59,511 64,258 Derivative assets 162,679 106,917 45,086 Accrued interest receivable 41,567 38,382 40,149 Other assets 114,241 107,632 65,224 Total assets $ 12,885,903 $ 12,347,085 $ 12,066,364 Liabilities: Non-interest-bearing checking $ 3,830,676 $ 3,839,724 $ 3,920,423 Interest-bearing checking 936,082 870,974 905,717 Savings 2,237,409 2,011,609 1,158,040 Money market 2,553,729 2,884,382 3,621,552 Certificates of deposit 930,774 959,312 853,242 Total deposits 10,488,670 10,566,001 10,458,974 FHLBNY advances 620,000 100,000 25,000 Other short-term borrowings 2,124 2,162 1,862 Subordinated debt, net 200,305 200,327 197,096 Derivative cash collateral 158,200 115,790 4,550 Operating lease liabilities 60,252 61,850 66,103 Derivative liabilities 144,343 93,420 40,728 Other liabilities 71,218 67,013 79,431 Total liabilities 11,745,112 11,206,563 10,873,744 Stockholders' equity: Preferred stock, Series A 116,569 116,569 116,569 Common stock 416 416 416 Additional paid-in capital 495,232 495,266 494,125 Retained earnings 733,783 705,371 654,726 Accumulated other comprehensive loss ("AOCI"), net of deferred taxes (93,036 ) (69,950 ) (6,181 ) Unearned equity awards (9,177 ) (10,260 ) (7,842 ) Treasury stock, at cost (102,996 ) (96,890 ) (59,193 ) Total stockholders' equity 1,140,791 1,140,522 1,192,620 Total liabilities and stockholders' equity $ 12,885,903 $ 12,347,085 $ 12,066,364 (1) Includes loans underlying multifamily cooperatives.
(2) While the loans within this category are often considered "commercial real estate" in nature, multifamily and loans underlying cooperatives are here reported separately from commercial real estate loans in order to emphasize the residential nature of the collateral underlying this significant component of the total loan portfolio.DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands except share and per share amounts)Three Months Ended Nine Months Ended September 30, June 30, September 30, September 30, September 30, 2022 2022 2021 2022 2021 Interest income: Loans $ 106,306 $ 93,102 $ 94,045 $ 285,828 $ 269,715 Securities 7,374 7,067 6,030 21,572 15,537 Other short-term investments 847 741 583 1,956 2,562 Total interest income 114,527 100,910 100,658 309,356 287,814 Interest expense: Deposits and escrow 10,154 3,731 3,565 16,416 13,666 Borrowed funds 3,483 3,573 2,265 9,334 8,225 Derivative cash collateral 452 94 — 547 — Total interest expense 14,089 7,398 5,830 26,297 21,891 Net interest income 100,438 93,512 94,828 283,059 265,923 Provision (credit) for credit losses 6,587 44 (5,187 ) 5,039 6,344 Net interest income after provision (credit) 93,851 93,468 100,015 278,020 259,579 Non-interest income: Service charges and other fees 3,866 4,337 4,581 12,261 11,377 Title fees 474 683 482 1,578 1,603 Loan level derivative income 549 1,685 445 2,240 2,796 BOLI income 2,177 4,143 2,249 8,159 5,181 Gain on sale of SBA loans 211 723 348 1,176 1,485 Gain on sale of PPP loans — — — — 20,697 Gain on sale of residential loans 54 191 304 393 1,533 Net gain on equity securities — — — — 131 Net gain on sale of securities and other assets 1,397 — — 1,397 730 Loss on termination of derivatives — — — — (16,505 ) Other 634 362 1,319 1,485 2,861 Total non-interest income 9,362 12,124 9,728 28,689 31,889 Non-interest expense: Salaries and employee benefits 29,188 28,454 28,276 88,476 80,693 Severance — 2,193 — 2,193 1,875 Occupancy and equipment 7,884 7,396 7,814 22,864 22,913 Data processing costs 3,434 3,913 3,573 11,152 12,132 Marketing 1,531 1,515 1,054 4,341 2,702 Professional services 2,116 2,028 2,751 6,238 7,154 Federal deposit insurance premiums 800 1,150 1,173 3,100 3,046 Loss on extinguishment of debt — 740 — 740 1,751 Curtailment loss — — — — 1,543 Merger expenses and transaction costs — — 2,472 — 42,250 Branch restructuring — — 4,518 — 6,177 Amortization of other intangible assets 431 430 715 1,447 1,907 Other 2,918 4,019 4,437 9,477 10,327 Total non-interest expense 48,302 51,838 56,783 150,028 194,470 Income before taxes 54,911 53,754 52,960 156,681 96,998 Income tax expense 15,430 15,269 14,565 44,184 28,359 Net income 39,481 38,485 38,395 112,497 68,639 Preferred stock dividends 1,822 1,822 1,822 5,465 5,465 Net income available to common stockholders $ 37,659 $ 36,663 $ 36,573 $ 107,032 $ 63,174 Earnings per common share ("EPS"): Basic $ 0.98 $ 0.94 $ 0.89 $ 2.74 $ 1.62 Diluted $ 0.98 $ 0.94 $ 0.89 $ 2.74 $ 1.62 Average common shares outstanding for diluted EPS 38,165,681 38,631,683 40,426,161 38,678,894 38,574,857 DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SELECTED FINANCIAL HIGHLIGHTS
(Dollars in thousands except per share amounts)At or For the Three Months Ended At or For the Nine Months Ended September 30, June 30, September 30, September 30, September 30, 2022 2022 2021 2022 2021 Per Share Data: Reported EPS (Diluted) $ 0.98 $ 0.94 $ 0.89 $ 2.74 $ 1.62 Cash dividends paid per common share 0.24 0.24 0.24 0.72 0.72 Book value per common share 26.55 26.41 26.64 26.55 26.64 Tangible common book value per share (1) 22.34 22.20 22.60 22.34 22.60 Tangible common book value per share excluding AOCI (1) 24.75 24.01 22.63 24.75 22.63 Common shares outstanding 38,572 38,769 40,715 38,572 40,715 Dividend payout ratio 24.49 % 25.53 % 26.97 % 26.28 % 44.44 % Performance Ratios (Based upon Reported Net Income): Return on average assets 1.26 % 1.27 % 1.22 % 1.22 % 0.76 % Return on average equity 13.56 13.44 12.69 12.83 8.00 Return on average tangible common equity (1) 17.15 17.08 15.96 16.20 9.84 Net interest margin 3.38 3.29 3.20 3.29 3.15 Non-interest expense to average assets 1.54 1.71 1.80 1.63 2.16 Efficiency ratio (1) 44.0 49.1 54.3 48.1 65.3 Effective tax rate 28.10 28.41 27.50 28.20 29.24 Balance Sheet Data: Average assets $ 12,550,626 $ 12,121,949 $ 12,584,372 $ 12,292,051 $ 12,009,522 Average interest-earning assets 11,782,361 11,412,350 11,765,298 11,511,149 11,277,257 Average tangible common equity (1) 885,182 865,329 929,131 889,044 873,481 Loan-to-deposit ratio at end of period 96.5 91.4 87.0 96.5 87.0 Capital Ratios and Reserves - Consolidated: (3) Tangible common equity to tangible assets (1) 6.77 % 7.07 % 7.54 % Tangible common equity excluding AOCI to tangible assets (1) 7.45 7.60 7.55 Tangible equity to tangible assets (1) 7.69 8.02 8.50 Tangible equity excluding AOCI to tangible assets (1) 8.36 8.55 8.51 Tier 1 common equity ratio 9.13 9.28 9.92 Tier 1 risk-based capital ratio 10.25 10.44 11.17 Total risk-based capital ratio 12.98 13.26 14.13 Tier 1 leverage ratio 8.61 8.71 8.37 CRE consolidated concentration ratio (2) 555 534 516 Allowance for credit losses/ Total loans 0.81 0.82 0.88 Allowance for credit losses/ Non-performing loans 199.45 218.80 238.84 (1) See "Non-GAAP Reconciliation" tables for reconciliation of tangible equity, tangible common equity, and tangible assets.
(2) The CRE consolidated concentration ratio is calculated using the sum of commercial real estate, excluding owner-occupied commercial real estate, multifamily, and acquisition, development, and construction, divided by consolidated capital. September 30, 2022 amounts are preliminary pending completion and filing of the Company’s regulatory reports.
(3) September 30, 2022 amounts are preliminary pending completion and filing of the Company’s regulatory reports.DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED AVERAGE BALANCES AND NET INTEREST INCOME
(Dollars in thousands)Three Months Ended September 30, 2022 June 30, 2022 September 30, 2021 Average Average Average Average Yield/ Average Yield/ Average Yield/ Balance Interest Cost Balance Interest Cost Balance Interest Cost Assets: Interest-earning assets: Real estate loans $ 8,981,848 $ 92,309 4.08 % $ 8,532,979 $ 81,454 3.83 % $ 8,289,973 $ 78,820 3.77 % Commercial and industrial loans 940,628 13,837 5.84 935,813 11,503 4.93 1,134,980 14,786 5.17 Other loans 10,566 160 6.01 11,571 145 5.03 21,391 439 8.14 Securities 1,666,398 7,374 1.76 1,695,702 7,067 1.67 1,438,348 6,030 1.66 Other short-term investments 182,921 847 1.84 236,285 741 1.26 880,606 583 0.26 Total interest-earning assets 11,782,361 114,527 3.86 % 11,412,350 100,910 3.55 % 11,765,298 100,658 3.39 % Non-interest-earning assets 768,265 709,599 819,074 Total assets $ 12,550,626 $ 12,121,949 $ 12,584,372 Liabilities and Stockholders' Equity: Interest-bearing liabilities: Interest-bearing checking $ 833,386 $ 970 0.46 % $ 858,402 $ 604 0.28 % $ 1,000,435 $ 388 0.15 % Money market 2,651,459 2,046 0.31 3,148,472 1,240 0.16 3,698,124 1,467 0.16 Savings 2,243,887 4,951 0.88 1,509,776 859 0.23 1,335,310 170 0.05 Certificates of deposit 988,827 2,187 0.88 827,286 1,028 0.50 1,138,853 1,540 0.54 Total interest-bearing deposits 6,717,559 10,154 0.60 6,343,936 3,731 0.24 7,172,722 3,565 0.20 FHLBNY advances 166,739 430 1.02 79,176 172 0.87 25,000 59 0.94 Subordinated debt, net 200,320 2,553 5.06 273,470 3,309 4.85 197,172 2,206 4.44 Other short-term borrowings 75,975 500 2.61 54,229 92 0.68 2,290 — — Total borrowings 443,034 3,483 3.12 406,875 3,573 3.52 224,462 2,265 4.00 Derivative cash collateral 111,325 452 1.61 98,995 94 0.38 1,695 — — Total interest-bearing liabilities 7,271,918 14,089 0.77 % 6,849,806 7,398 0.43 % 7,398,879 5,830 0.31 % Non-interest-bearing checking 3,894,093 3,935,765 3,787,928 Other non-interest-bearing liabilities 219,883 191,066 186,977 Total liabilities 11,385,894 10,976,637 11,373,784 Stockholders' equity 1,164,732 1,145,312 1,210,588 Total liabilities and stockholders' equity $ 12,550,626 $ 12,121,949 $ 12,584,372 Net interest income $ 100,438 $ 93,512 $ 94,828 Net interest rate spread 3.09 % 3.12 % 3.08 % Net interest margin 3.38 % 3.29 % 3.20 % Deposits (including non-interest-bearing checking accounts) $ 10,611,652 $ 10,154 0.38 % $ 10,279,701 $ 3,731 0.15 % $ 10,960,650 $ 3,565 0.13 % DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SCHEDULE OF NON-PERFORMING ASSETS
(Dollars in thousands)At or For the Three Months Ended September 30, June 30, September 30, Asset Quality Detail 2022 2022 2021 Non-performing loans ("NPLs") (1) One-to-four family residential, including condominium and cooperative apartment $ 3,219 $ 3,128 $ 4,938 Multifamily residential and residential mixed-use — — 859 Commercial real estate 7,673 5,020 4,122 Acquisition, development, and construction 657 657 — C&I 29,532 27,365 23,727 Other — 131 374 Total Non-accrual loans $ 41,081 $ 36,301 $ 34,020 Total Non-performing assets ("NPAs") $ 41,081 $ 36,301 $ 34,020 Loans 90 days delinquent and accruing ("90+ Delinquent") One-to-four family residential, including condominium and cooperative apartment $ — $ 341 $ 5,021 Multifamily residential and residential mixed-use — — — Commercial real estate — — 1,004 Acquisition, development, and construction — — — C&I 2,781 24 257 Other — — — 90+ Delinquent $ 2,781 $ 365 $ 6,282 NPAs and 90+ Delinquent $ 43,862 $ 36,666 $ 40,302 NPAs and 90+ Delinquent / Total assets 0.34 % 0.30 % 0.33 % Net charge-offs (recoveries) ("NCOs") $ 3,932 $ 555 $ 4,191 NCOs / Average loans (1) 0.16 % 0.02 % 0.18 % (1) Calculated based on annualized NCOs to average loans, excluding loans held for sale.
DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
NON-GAAP RECONCILIATION
(Dollars in thousands except per share amounts)The following tables below provide a reconciliation of certain financial measures calculated under generally accepted accounting principles ("GAAP") (as reported) and non-GAAP measures. A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts that are required to be disclosed in the most directly comparable measure calculated and presented in accordance with GAAP in the United States. The Company’s management believes the presentation of non-GAAP financial measures provide investors with a greater understanding of the Company’s operating results in addition to the results measured in accordance with GAAP. While management uses these non-GAAP measures in its analysis of the Company’s performance, this information should not be viewed as a substitute for financial results determined in accordance with GAAP or considered to be more important than financial results determined in accordance with GAAP.
The following non-GAAP financial measures exclude pre-tax income and expenses associated with the Company’s February 2021 merger with Bridge Bancorp, Inc., as well as a gain on sale of a branch property, branch restructuring, gain on sale of PPP loans, severance, and loss on extinguishment of debt:
Three Months Ended Nine Months Ended September 30, June 30, September 30, September 30, September 30, 2022 2022 2021 2022 2021 Reconciliation of Reported and Adjusted (non-GAAP) Net Income Available to Common Stockholders Reported net income available to common stockholders $ 37,659 $ 36,663 $ 36,573 $ 107,032 $ 63,174 Adjustments to net income (1): Provision for credit losses - Non-PCD loans (double-count) — — — — 20,278 Gain on sale of PPP loans — — — — (20,697 ) Net gain on sale of securities and other assets (1,397 ) — — (1,397 ) (710 ) Loss on termination of derivatives — — — — 16,505 Severance — 2,193 — 2,193 1,875 Loss on extinguishment of debt — 740 — 740 1,751 Curtailment loss — — — — 1,543 Merger expenses and transaction costs (2) — — 2,472 — 42,250 Branch restructuring — — 4,518 — 6,177 Income tax effect of adjustments and other tax adjustments 440 (295 ) (2,191 ) 145 (19,187 ) Adjusted net income available to common stockholders (non-GAAP) $ 36,702 $ 39,301 $ 41,372 $ 108,713 $ 112,959 Adjusted Ratios (Based upon non-GAAP as calculated above) Adjusted EPS (Diluted) $ 0.95 $ 1.01 $ 1.01 $ 2.78 $ 2.90 Adjusted return on average assets 1.23 % 1.36 % 1.37 % 1.24 % 1.31 % Adjusted return on average equity 13.23 14.36 14.27 13.02 13.80 Adjusted return on average tangible common equity 16.72 18.30 18.02 16.45 17.44 Adjusted non-interest expense to average assets 1.53 1.60 1.56 1.58 1.54 Adjusted efficiency ratio 44.2 45.9 46.9 46.9 47.4 (1) Adjustments to net income are taxed at the Company's statutory tax rate of approximately 31% unless otherwise noted.
(2) Certain merger expenses and transaction costs are non-taxable expense.The following table presents a reconciliation of operating expense as a percentage of average assets (as reported) and adjusted operating expense as a percentage of average assets (non-GAAP):
Three Months Ended Nine Months Ended September 30, June 30, September 30, September 30, September 30, 2022 2022 2021 2022 2021 Operating expense as a % of average assets - as reported 1.54 % 1.71 % 1.80 % 1.63 % 2.16 % Loss on extinguishment of debt — (0.03 ) — (0.01 ) (0.02 ) Curtailment loss — — — — (0.02 ) Severance — (0.07 ) — (0.02 ) (0.02 ) Merger expenses and transaction costs — — (0.08 ) — (0.47 ) Branch restructuring — — (0.14 ) — (0.07 ) Amortization of other intangible assets (0.01 ) (0.01 ) (0.02 ) (0.02 ) (0.02 ) Adjusted operating expense as a % of average assets (non-GAAP) 1.53 1.60 1.56 1.58 1.54 The following table presents a reconciliation of efficiency ratio (non-GAAP) and adjusted efficiency ratio (non-GAAP):
Three Months Ended Nine Months Ended September 30, June 30, September 30, September 30, September 30, 2022 2022 2021 2022 2021 Efficiency ratio - as reported (non-GAAP) (1) 44.0 % 49.1 % 54.3 % 48.1 % 65.3 % Non-interest expense - as reported $ 48,302 $ 51,838 $ 56,783 $ 150,028 $ 194,470 Severance — (2,193 ) — (2,193 ) (1,875 ) Merger expenses and transaction costs — — (2,472 ) — (42,250 ) Branch restructuring — — (4,518 ) — (6,177 ) Loss on extinguishment of debt — (740 ) — (740 ) (1,751 ) Curtailment loss — — — — (1,543 ) Amortization of other intangible assets (431 ) (430 ) (715 ) (1,447 ) (1,907 ) Adjusted non-interest expense (non-GAAP) $ 47,871 $ 48,475 $ 49,078 $ 145,648 $ 138,967 Net interest income - as reported $ 100,438 $ 93,512 $ 94,828 $ 283,059 $ 265,923 Non-interest income - as reported $ 9,362 $ 12,124 $ 9,728 $ 28,689 $ 31,889 Gain on sale of PPP loans — — — — (20,697 ) Net gain on sale of securities and other assets (1,397 ) — — (1,397 ) (710 ) Loss on termination of derivatives — — — — 16,505 Adjusted non-interest income (non-GAAP) $ 7,965 $ 12,124 $ 9,728 $ 27,292 $ 26,987 Adjusted total revenues for adjusted efficiency ratio (non-GAAP) $ 108,403 $ 105,636 $ 104,556 $ 310,351 $ 292,910 Adjusted efficiency ratio (non-GAAP) (2) 44.2 % 45.9 % 46.9 % 46.9 % 47.4 % (1) The reported efficiency ratio is a non-GAAP measure calculated by dividing GAAP non-interest expense by the sum of GAAP net interest income and GAAP non-interest income.
(2) The adjusted efficiency ratio is a non-GAAP measure calculated by dividing adjusted non-interest expense by the sum of GAAP net interest income and adjusted non-interest income.The following table presents the tangible common equity to tangible assets, tangible equity to tangible assets, and tangible common book value per share calculations (non-GAAP):
September 30, June 30, September 30, 2022 2022 2021 Reconciliation of Tangible Assets: Total assets $ 12,885,903 $ 12,347,085 $ 12,364,381 Goodwill (155,797 ) (155,797 ) (155,339 ) Other intangible assets (6,915 ) (7,346 ) (9,077 ) Tangible assets (non-GAAP) $ 12,723,191 $ 12,183,942 $ 12,199,965 Reconciliation of Tangible Common Equity - Consolidated: Total stockholders' equity $ 1,140,791 $ 1,140,522 $ 1,201,117 Goodwill (155,797 ) (155,797 ) (155,339 ) Other intangible assets (6,915 ) (7,346 ) (9,077 ) Tangible equity (non-GAAP) 978,079 977,379 1,036,701 Preferred stock, net (116,569 ) (116,569 ) (116,569 ) Tangible common equity (non-GAAP) $ 861,510 $ 860,810 $ 920,132 Tangible common equity (non-GAAP) $ 861,510 $ 860,810 $ 920,132 AOCI, net of deferred taxes 93,036 69,950 1,042 Tangible common equity excluding AOCI (non-GAAP) $ 954,546 $ 930,760 $ 921,174 Tangible equity (non-GAAP) $ 978,079 $ 977,379 $ 1,036,701 AOCI, net of deferred taxes 93,036 69,950 1,042 Tangible equity excluding AOCI (non-GAAP) $ 1,071,115 $ 1,047,329 $ 1,037,743 Common shares outstanding 38,572 38,769 40,715 Tangible common equity to tangible assets (non-GAAP) 6.77 % 7.07 % 7.54 % Tangible common equity excluding AOCI to tangible assets (non-GAAP) 7.45 7.60 7.55 Tangible equity to tangible assets (non-GAAP) 7.69 8.02 8.50 Tangible equity excluding AOCI to tangible assets (non-GAAP) 8.36 8.55 8.51 Book value per share $ 26.55 $ 26.41 $ 26.64 Tangible common book value per share (non-GAAP) 22.34 22.20 22.60 Tangible common book value per share excluding AOCI (non-GAAP) 24.75 24.01 22.63